EXHIBIT 1.1
MISSISSIPPI CHEMICAL CORPORATION
1,000,000 SHARES
COMMON STOCK
(PAR VALUE $.01 PER SHARE)
UNDERWRITING AGREEMENT
----------------------
New York, New York
, 1995
Xxxxxxxx Xxxxxxxx & Co. Incorporated
Equitable Center
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Dear Sirs:
SF Services, Inc. (the "Selling Securityholder"), a securityholder of
Mississippi Chemical Corporation, a Mississippi corporation (the "Company"),
proposes, subject to the terms and conditions stated herein, to sell to Xxxxxxxx
Wertheim & Co. Incorporated (the "Underwriter"), an aggregate of 1,000,000
shares of Common Stock, par value $.01 per share (the "Common Stock"). The
1,000,000 shares of Common Stock to be sold by the Selling Securityholder are
herein referred to as the "Firm Securities." In addition, the Selling
Securityholder proposes to grant to the Underwriter an option to purchase up to
an additional 100,000 shares of Common Stock (the "Option Securities"), on the
terms and for the purposes set forth in Section 2 hereof. The Firm Securities
and the Option Securities are herein collectively referred to as the
"Securities."
1A. The Company represents and warrants to, and agrees with, the Underwriter
that:
(a) A registration statement on Form S-3 (File No. 33- ), and as a part
thereof a preliminary prospectus, in respect of the Securities, has been filed
with the Securities and Exchange Commission (the "Commission") in the form
heretofore delivered to you; if such registration statement has not become
effective, an amendment (the "Final Amendment") to such registration statement,
including a form of final prospectus, necessary to permit such registration
statement to become effective, will promptly be filed by the Company with the
Commission; if such registration statement has become effective and any post-
effective amendment to such registration statement has been filed with the
Commission prior to the execution and delivery of this Agreement, which
amendment or amendments shall be in form acceptable to you, the most recent such
amendment has been declared effective by the Commission; if such registration
statement has become effective, either (i) a final prospectus (the "Rule 430A
Prospectus") relating to the Securities containing information permitted to be
omitted at the time of effectiveness by Rule 430A of the rules and regulations
of the Commission under the Securities Act of 1933, as amended (the "Act"), will
promptly be filed by the Company pursuant to Rule 424(b) of the rules and
regulations of the Commission under the Act, or (ii) if the Company relies on
Rule 434 under the Act, a Term Sheet (as
hereinafter defined) relating to the Securities, that shall identify the
Preliminary Prospectus (as hereinafter defined) that it supplements containing
such information as is required or permitted by Rules 434, 430A and 424(b) of
the rules and regulations of the Commission under the Act will be promptly filed
by the Company pursuant to said Rule 424(b); any preliminary prospectus filed as
part of such registration statement being herein called a "Preliminary
Prospectus;" such registration statement as amended at the time that it becomes
or became effective, or, if applicable, as amended at the time the most recent
post-effective amendment to such registration statement filed with the
Commission prior to the execution and delivery of this Agreement became
effective (the "Effective Date"), including all exhibits thereto (whether filed
or incorporated by reference) and all information deemed to be a part thereof at
such time pursuant to Rules 430A and 434 of the rules and regulations of the
Commission under the Act, being herein called the "Registration Statement;" (x)
if the Company relies on Rule 434 of the rules and regulations of the Commission
under the Act, the Term Sheet relating to the Securities that is first filed
pursuant to Rule 424(b)(7) under the Act, together with the Preliminary
Prospectus identified therein that such Term Sheet supplements, (y) if the
Company does not rely on said Rule 434, the final prospectus relating to the
Securities in the form first filed pursuant to Rule 424(b)(1) or (4) of the
rules and regulations of the Commission under the Act, or (z) if no such filing
is required, the form of final prospectus included in the Registration
Statement, being herein called the "Prospectus"; and any term sheet that
satisfies the requirements of Rule 434 of the rules and regulations of the
Commission under the Act being herein called a "Term Sheet;" any reference
herein to any Preliminary Prospectus or the Prospectus or the Registration
Statement shall be deemed to include any information incorporated by reference
therein, as of the date of such Preliminary Prospectus, the Prospectus or the
Registration Statement, as the case may be, and any reference to any amendment
or supplement to any Preliminary Prospectus, the Prospectus or the Registration
Statement shall be deemed to refer to any documents filed after such date under
the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and the
rules and regulations of the Commission thereunder and so incorporated by
reference;
(b) No order preventing or suspending the use of any Preliminary Prospectus has
been issued by the Commission, and each Preliminary Prospectus, at the time of
filing thereof, conformed in all material respects to the requirements of the
Act and the rules and regulations of the Commission thereunder, and did not
contain an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein, in
the light of the circumstances under which they were made, not misleading;
provided, however, that this representation and warranty shall not apply to any
statements or omissions made in reliance upon and in conformity with information
furnished in writing to the Company by the Underwriter expressly for use
therein;
(c) On the Effective Date and the date the Prospectus is filed with the
Commission, the Registration Statement and the Prospectus, respectively, did,
and when any further amendment or supplements thereto become effective or are
filed with the Commission, as the case may be, the Registration Statement and
the Prospectus, as amended by such amendment or supplements, will, conform in
all material respects to the requirements of the Act and the rules and
regulations of the Commission thereunder, and did not and will not, as the case
may be, contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading; provided, however, that this representation and warranty
shall not apply to any statements or omissions made in reliance upon and in
conformity with information furnished in writing to the Company by the
Underwriter expressly for use therein;
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(d) The documents incorporated by reference in the Registration Statement, when
they were filed with the Commission, conformed in all material respects to the
requirements of the Exchange Act, and the rules and regulations of the
Commission thereunder, and none of such documents contained an untrue statement
of a material fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading;
(e) The Company has all requisite power and authority to execute, deliver and
perform its obligations under this Agreement; the execution, delivery and
performance by the Company of its obligations under this Agreement have been
duly and validly authorized by all requisite corporate action of the Company;
and this Agreement constitutes the legal, valid and binding obligation of the
Company, enforceable against the Company in accordance with its terms;
(f) Neither the Company nor any of its subsidiaries has sustained since June 30,
1995, any loss or interference with its business from fire, explosion, flood or
other calamity, whether or not covered by insurance, or from any labor dispute
or court or governmental action, order or decree, which loss or interference is
material to the Company and its subsidiaries, taken as a whole; and, since the
respective dates as of which information is given in the Registration Statement
and the Prospectus, there has not been, and prior to the Time of Delivery (as
defined in Section 4 hereof) there will not be, any material change in the
capital stock or short-term debt or long-term debt of the Company or any of its
subsidiaries, or any material adverse change, or any development involving a
prospective material adverse change, in or affecting the general affairs,
management, financial position, stockholders' equity or results of operations of
the Company and its subsidiaries, taken as a whole, otherwise than as set forth
or contemplated in the Prospectus;
(g) The Company and its subsidiaries have good and marketable title in fee
simple to all real property and good and marketable title to all personal
property owned by them, in each case free and clear of all liens, encumbrances
and defects except such as are described in or contemplated by the Registration
Statement or the Prospectus, or such as do not materially affect the value of
such property and do not interfere with the use made and proposed to be made of
such property by the Company and its subsidiaries, and any real property and
buildings held under lease by the Company and its subsidiaries are held by them
under valid, subsisting and enforceable leases with such exceptions as are not
material and do not interfere with the use made and proposed to be made of such
real property and buildings by the Company and its subsidiaries;
(h) The Company has been duly organized and is validly existing as a corporation
in good standing under the laws of the state of Mississippi, with power and
authority (corporate and other) to own its properties and to conduct its
business as described in the Registration Statement and the Prospectus, and has
been duly qualified as a foreign corporation for the transaction of business and
is in good standing under the laws of each other jurisdiction in which it owns
or leases property, or conducts any business, so as to require such
qualification (except where the failure to so qualify would not have a material
adverse effect on the Company or the Company and its subsidiaries considered as
a whole); and each of the Company's subsidiaries listed in Exhibit 21 to the
Registration Statement has been duly incorporated and is validly existing as a
corporation in good standing under the laws of its jurisdiction of
incorporation, and has been duly qualified as a foreign corporation for the
transaction of business and is in good standing under the laws of each other
jurisdiction in which it owns or leases property, or conducts any business, so
as to require such qualification (except where the failure to so qualify would
not have a material adverse effect on the Company and its subsidiaries
considered as a whole); and the Company has all necessary corporate
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power and all material government authorizations, permits and approvals required
to conduct its business as described in the Registration Statement and in the
Prospectus;
(i) The Company has an authorized, issued and outstanding capitalization as set
forth in the Registration Statement, and all the issued shares of Common Stock
have been duly and validly authorized and issued, are fully paid and non-
assessable, are free of any statutory preemptive rights, contractual preemptive
rights, rights of first refusal or similar rights, were issued and sold in
compliance with applicable federal and state securities laws and conform in all
material respects to the description in the Prospectus; except as described in
the Prospectus, there are no outstanding options, warrants or other rights
calling for the issuance of, and there are no commitments, plans or arrangements
to issue, any shares of capital stock of the Company or any security convertible
or exchangeable or exercisable for capital stock of the Company; there are no
holders of securities of the Company who, by reason of the filing of the
Registration Statement, have the right (and have not waived such right) to
request the Company to include in the Registration Statement securities owned by
them; and all of the issued and outstanding shares of capital stock of each
subsidiary of the Company have been duly and validly authorized and issued, are
fully paid and non-assessable and are owned by the Company free and clear of all
liens, encumbrances, equities or claims; and there are no outstanding options,
warrants or other rights calling for the issuance of, and there are no
commitments, plans or arrangements to issue, any shares of capital stock of any
subsidiary or any security convertible or exchangeable or exercisable for
capital stock of any subsidiary;
(j) Triad Chemical ("Triad"), an unincorporated joint venture that is owned 50%
by the Company and 50% by First Mississippi Corporation, has not sustained since
June 30, 1995, any loss or interference with its business from fire, explosion,
flood or other calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree, which loss or
interference is material to Triad; and, since the respective dates as of which
information is given in the Registration Statement and the Prospectus, there has
not been, and prior to the Time of Delivery (as defined in Section 4 hereof)
there will not be, any material change in the short-term debt or long-term debt
of Triad, or any material adverse change, or any development involving a
prospective material adverse change, in or affecting the general affairs,
management, financial position or results of operations of Triad, otherwise than
as set forth or contemplated in the Prospectus; the Company owns a 50% equity
interest in Triad free and clear of all liens, encumbrances, equities or claims;
Triad has good and marketable title in fee simple to all real property and good
and marketable title to all personal property owned by it in each case free and
clear of all liens, encumbrances and defects except such as are described or
contemplated by the Registration Statement or the Prospectus; Triad has all
necessary power and authority, and all material government authorizations,
permits and approvals, required to conduct its business as described in the
Registration Statement and in the Prospectus; and there are no outstanding
options, warrants or other rights calling for the issuance of, and there are no
commitments, plans or arrangements to issue, any other equity interest in Triad;
(k) The Securities to be sold to the Underwriter hereunder have been duly and
validly authorized and, when issued and delivered against payment therefor as
provided herein, will be duly and validly issued, fully paid and non-assessable,
will conform in all material respects to the description of the Common Stock in
the Registration Statement and in the Prospectus and are included for quotation
on the Nasdaq Stock Market's National Market (the "Nasdaq National Market") as
of the Effective Date;
(l) The performance of this Agreement and the consummation of the transactions
herein contemplated will not conflict with or result in a breach or violation of
any of the terms or
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provisions of, or constitute a default under, any indenture, mortgage, deed of
trust, loan agreement, lease or other agreement or instrument to which the
Company or any of its subsidiaries is a party or by which the Company or any of
its subsidiaries is bound or to which any of the property or assets of the
Company or any of its subsidiaries is subject, nor will such action result in
any violation of the provisions of the Certificate of Incorporation or the
Bylaws, in each case as amended to the date hereof, of the Company or the
provisions of the similar corporate constituent documents, in each case as
amended to the date hereof, of any of its subsidiaries, or any statute or any
order, rule or regulation of any court or governmental agency or body having
jurisdiction over the Company or any of its subsidiaries or any of their
properties; and no consent, approval, authorization, order, registration or
qualification of or with any court or governmental agency or body is required
for the issue and sale of the Securities or the consummation of the other
transactions contemplated by this Agreement, except the registration under the
Act of the Securities, 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 Securities
by the Underwriter;
(m) There are no legal or governmental proceedings pending to which the Company,
any of its subsidiaries or Triad is a party or of which any property of the
Company, any of its subsidiaries or Triad is the subject, other than litigation
or proceedings disclosed in the Prospectus or incident to the business conducted
by the Company, its subsidiaries and Triad, none of which will individually or
in the aggregate have a material adverse effect on the financial position,
stockholders' equity or results of operations of the Company, its subsidiaries
and Triad considered as a whole; and, to the Company's knowledge, no such
proceedings are threatened or contemplated by governmental authorities or
threatened or contemplated by others; and neither the Company nor any of its
subsidiaries nor Triad is involved in any material labor dispute, nor, to the
Company's knowledge, is any labor dispute threatened;
(n) The Company and its subsidiaries have obtained such material licenses,
permits and other approvals or authorizations of and from governmental or
regulatory authorities ("Permits") as are necessary under applicable law to own
their respective properties and to conduct their respective businesses in the
manner now being conducted and as described in the Registration Statement and in
the Prospectus; and the Company and its subsidiaries have fulfilled and
performed in all material respects all of their respective obligations with
respect to such Permits, and no event has occurred which allows, or after notice
or lapse of time or both would allow, revocation or termination thereof or
result in any other material impairment of the rights of the holder of any such
Permits;
(o) Xxxxxx Xxxxxxxx LLP, who have certified certain consolidated financial
statements of the Company and its subsidiaries, are independent public
accountants as required by the Act and the rules and regulations of the
Commission thereunder;
(p) The consolidated financial statements of the Company and its subsidiaries
included in the Registration Statement and the Prospectus (which include the
Company's proportionate share of 50% of the assets and liabilities of Triad)
present fairly the financial condition, the results of operations and the cash
flows of the Company and its subsidiaries as of the dates and for the periods
therein specified in conformity with generally accepted accounting principles
consistently applied throughout the periods involved, except as otherwise stated
therein; and the other financial and statistical information and data set forth
in the Registration Statement and the Prospectus is accurately presented in all
material respects and, to the extent such information and data is derived from
the financial statements and books and records of the Company and its
subsidiaries, is prepared on a basis consistent with such financial statements
and the books and records of the
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Company and its subsidiaries; no other financial statements are required to be
included in the Registration Statement and the Prospectus;
(q) There are no statutes or governmental regulations, or any contracts or other
documents that are required to be described in or filed, or incorporated by
reference, as exhibits to the Registration Statement which are not described
therein or filed as exhibits thereto or incorporated by reference therein;
(r) The Company and its subsidiaries own or possess adequate patent rights or
licenses or other rights to use patent rights, inventions, trademarks, service
marks, trade names and copyrights necessary to conduct the general business now
operated by them and neither the Company nor any of its subsidiaries has
received any notice of infringement of or conflict with asserted rights of
others with respect to any patent, patent rights, inventions, trademarks,
service marks, trade names or copyrights which, singly or in the aggregate,
could materially adversely affect the business, operations, financial condition,
income or business prospects of the Company and its subsidiaries considered as a
whole;
(s) Neither the Company nor any of its subsidiaries is in violation of any term
or provision of its Certificate of Incorporation or Bylaws (or similar corporate
constituent documents), in each case as amended to the date hereof, or any law,
ordinance, administrative or governmental rule or regulation applicable to the
Company or any of its subsidiaries, or of any decree of any court or
governmental agency or body having jurisdiction over the Company or any of its
subsidiaries, the violation of which either individually or together with all
such other violations would have a material adverse effect on the Company and
its subsidiaries considered as a whole;
(t) No default exists, and no event has occurred which with notice or lapse of
time, or both, would constitute a material default in the due performance and
observance of any term, covenant or condition of any indenture, mortgage, deed
of trust, bank loan or credit agreement, lease or other agreement or instrument
to which the Company or any of its subsidiaries is a party or by which any of
them is bound;
(u) The Company and its subsidiaries have timely filed all necessary tax returns
and notices and have paid all federal, state, county, local and foreign taxes of
any nature whatsoever for all tax years through June 30, 1995, to the extent
such taxes have become due. Except as disclosed in the Registration Statement
and in the Prospectus, the Company has no knowledge of any tax deficiencies
which would have a material adverse effect on the Company or any of its
subsidiaries, considered as a whole, or of any further liability (whether or not
disclosed on such returns) or assessments for any such taxes, and no interest or
penalties accrued or accruing with respect thereto, except as may be set forth
or adequately reserved for in the financial statements included in the
Registration Statement; the amounts currently set up as provisions for taxes or
otherwise by the Company and its subsidiaries on their respective books and
records are sufficient for the payment of all their unpaid federal, foreign,
state, county and local taxes accrued through the dates as of which they speak,
and for which the Company and its subsidiaries may be liable in their own right,
or as a transferee of the assets of, or as successor to, any other corporation,
association, partnership, joint venture or other entity;
(v) The Company and its subsidiaries maintain a system of internal accounting
controls sufficient to provide reasonable assurances that (i) transactions are
executed in accordance with management's general or specific authorization; (ii)
transactions are recorded as necessary to permit preparation of financial
statements in conformity with generally accepted accounting
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principles and to maintain accountability for assets; (iii) access to assets is
permitted only in accordance with management's general or specific
authorization; and (iv) the recorded accountability for assets is compared with
existing assets at reasonable intervals and appropriate action is taken with
respect to any differences;
(w) Neither the Company nor any of its subsidiaries is in violation of any
foreign, federal, state or local law or regulation relating to the protection of
human health and safety, the environment or hazardous or toxic substances or
wastes, pollutants or contaminants, nor any federal or state law relating to
discrimination in the hiring, promotion or paying of employees nor any
applicable federal or state wages and hours laws, nor any provisions of the
Employee Retirement Income Security Act of 1974, as amended, or the rules and
regulations promulgated thereunder, the violation of which either individually
or together with all such other violations would have a material adverse effect
on the Company and its subsidiaries considered as a whole;
(x) Neither the Company nor any of its subsidiaries, nor, to the Company's
knowledge, any employee or agent of the Company or any of its subsidiaries has
made any payment of funds of the Company or any of its subsidiaries or received
or retained any funds in violation of any law, rule or regulation, which
payment, receipt or retention of funds is of a character required to be
disclosed in the Prospectus;
(y) The Company has not taken, directly or indirectly, any action designed to or
which has constituted or that might reasonably be expected to cause or result
in, stabilization or manipulation of the price of any security of the Company to
facilitate the sale or resale of the Securities, in each case as defined under
the Exchange Act and the rules and regulations of the Commission thereunder;
(z) The Company has made all filings required to be made by it under the
Exchange Act;
(aa) The conditions for the use of Form S-3, as set forth in the General
Instructions thereto, have been satisfied;
(bb) The Company has executed and delivered an Omnibus Transfer, Receipt and
Release dated June 24, 1994 (the "Release Agreement") among the Company, General
Electric Capital Corporation ("GECC"), National Bank for Cooperatives
("CoBank"), Newsprint South, Inc. ("Newsprint South"), and other interested
parties, and all other documents and agreements referred to in the Release
Agreement (collectively, the "Settlement Documents"). The Settlement Documents
have released the Company from all of its obligations and liabilities to
Newsprint South, GECC and CoBank, as well as its obligations and liabilities
under all agreements related to the Project (as defined in the Release
Agreement). The Company has no further obligations or liabilities to Newsprint
South, GECC or CoBank, or under any agreement related to the Project, except as
set forth in the Settlement Documents; and
(cc) Farmland MissChem Limited has no material assets or liabilities.
1B. The Selling Securityholder, represents and warrants to, and agrees
withUnderwriter and the Company that:
(a) The Selling Securityholder has all requisite power and authority to
execute, deliver and perform its obligations under this Agreement; the
execution, delivery and performance by the Selling Securityholder of its
obligations under this Agreement have been duly and validly
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authorized by all requisite corporate action of the Selling Securityholder; and
this Agreement constitutes the legal, valid and binding obligation of the
Selling Securityholder, enforceable against the Selling Securityholder in
accordance with its terms;
(b) Certificates for the Securities to be sold by the Selling Securityholder,
with an appropriate stock power attached thereto, have been placed in custody
with the Underwriter for delivery under this Agreement. The Selling
Securityholder agrees that the Securities represented by the certificates so
held in custody are subject to the interests of the Underwriter hereunder, that
the arrangements made for such custody are irrevocable, and that the obligations
of the Selling Securityholder hereunder shall not be terminated by any act of
the Selling Securityholder or by operation of law, whether by incapacity,
dissolution or winding up of the Selling Securityholder or the occurrence of any
other event. If any such incapacity, dissolution, winding up or other event
should occur before the delivery of the Securities to be sold by the Selling
Securityholder hereunder, certificates for the Securities of the Selling
Securityholder shall be delivered by the Underwriter in accordance with the
terms and conditions of this Agreement as if such death, incapacity, dissolution
or winding up or other event has not occurred, regardless of whether the
Underwriter shall have received notice of such death, incapacity, dissolution,
winding up or other event;
(c) The Selling Securityholder has, and at the Time of Delivery (as defined in
Section 4 hereof) will have, good and marketable title to the Securities to be
sold by the Selling Securityholder hereunder, free and clear of any liens,
encumbrances, equities, security interests, claims and other restrictions of any
nature whatsoever, and the Selling Securityholder has the full right, power and
authority to sell, assign, transfer and deliver such Securities hereunder and to
make the representations, warranties, covenants and agreements made by it in
this Agreement; and upon the delivery of and payment for such Securities as
herein provided, the Underwriter will acquire good and marketable title thereto,
free and clear of all liens, encumbrances, equities, security interests, claims
and other restrictions of any nature whatsoever;
(d) The performance of this Agreement and the consummation of the transactions
herein contemplated and the fulfillment of the terms hereof will not result in a
breach by the Selling Securityholder of any of the terms or provisions of, or
constitute a default by it under, its certificate of incorporation, bylaws or
other constituent documents, any material agreement or instrument to which it is
a party or by which it is bound, or any statute, ruling, decree, judgment, order
or regulation known to it of any governmental authority having jurisdiction over
it or its property;
(e) The Selling Securityholder has not taken and will not take, directly or
indirectly, any action designed to or which has constituted or which might
reasonably be expected to cause or result in, stabilization or manipulation of
the price of any security of the Company to facilitate the sale or resale of the
Securities, in each case as defined under the Exchange Act and the rules and
regulations of the Commission thereunder;
(f) To the extent that any statements or omissions are made in the Registration
Statement, any Preliminary Prospectus, the Prospectus or any amendment or
supplement thereto in reliance upon and in conformity with written information
furnished to the Company by the Selling Securityholder specifically for use
therein, such Preliminary Prospectus did, and the Registration Statement and the
Prospectus and any amendments or supplements thereto, when they become effective
or are filed with the Commission, as the case may be, will, conform in all
material respects to the requirements of the Act and the rules and regulations
of the Commission thereunder and did not and will not contain an 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;
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(g) The sale by such Selling Stockholder of Securities pursuant hereto is not
prompted by any adverse information concerning the Company that is not set forth
in the Registration Statement or the Prospectus;
(h) At the Time of Delivery, all stock transfer or other taxes (other than
income taxes) which are required to be paid in connection with the sale and
transfer of the Securities to be sold by the Selling Securityholder to the
Underwriter hereunder will have been fully paid or provided for by the Selling
Securityholder and all laws imposing such taxes will have been fully complied
with; and
(i) The Selling Securityholder will not, during the period of 90 days after the
date hereof, except pursuant to this Agreement, offer, sell, contract to sell,
or otherwise dispose of any capital stock of the Company (or securities
convertible into, or exchangeable for, capital stock of the Company), directly
or indirectly, without the prior written consent of the Underwriter;
2. Subject to the terms and conditions herein set forth, the Selling
Securityholder agrees to sell to the Underwriter 1,000,000 Firm Securities and
the Underwriter agrees to purchase from the Selling Securityholder, at a
purchase price of $ per share, the 1,000,000 Firm Securities.
In addition, subject to the terms and conditions herein set forth, the Selling
Securityholder agrees to issue and sell to the Underwriter an aggregate of
100,000 Option Securities, as required (for the sole purpose of covering over-
allotments in the sale of the Firm Securities), at the purchase price per share
of the Firm Securities being sold by the Selling Securityholder as stated in the
preceding paragraph. The right to purchase the Option Securities may be
exercised by your giving 48 hours' prior written notice to the Company and to
the Selling Securityholder of your determination to purchase all or a portion of
the Option Securities. Such notice may be given at any time within a period of
30 days following the date of this Agreement. No Option Securities shall be
delivered to or for the account of the Underwriter unless the Firm Securities
shall be simultaneously delivered or shall theretofore have been delivered as
herein provided. The Underwriter may cancel any purchase of Option Securities at
any time prior to the Option Securities Delivery Date (as defined in Section 4
hereof) by giving written notice of such cancellation to the Company and to the
Selling Securityholder.
3. Upon the authorization by you of the release of the Securities, the
Underwriter proposes to offer the Securities for sale upon the terms and
conditions set forth in the Prospectus.
4. Certificates in definitive form for the Firm Securities to be purchased by
the Underwriter hereunder shall be delivered by or on behalf of the Selling
Securityholder to you for your account, against payment by you of the purchase
price therefor by certified or official bank check or checks, payable in New
York Clearing House funds, to the order of the Selling Securityholder, for the
purchase price of the Firm Securities being sold by the Selling Securityholder,
in New York, New York, at 9:30 A.M., New York City time, on ,
1995, or at such other time, date and place as you, the Company and the Selling
Securityholder may agree upon in writing, such time and date being herein called
the "Time of Delivery."
Certificates in definitive form for the Option Securities to be purchased by the
Underwriter hereunder shall be delivered by or on behalf of the Selling
Securityholder to you for your account , against payment by you of the purchase
price thereof by certified or official bank check or checks, payable in New York
Clearing House funds, to the order of the Selling Securityholder for the
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purchase price of the Option Securities, in New York, New York, at such time and
on such date (not earlier than the Time of Delivery nor later than ten business
days after giving of the notice delivered by you to the Company and the Selling
Securityholder with reference thereto) and in such denominations and registered
in such names as shall be specified in the notice delivered by you to the
Company and the Selling Securityholder with respect to the purchase of such
Option Securities. The date and time of such delivery and payment are herein
sometimes referred to as the "Option Securities Delivery Date." The obligations
of the Underwriter shall be subject, in its discretion, to the condition that
there shall be delivered to the Underwriter on the Option Securities Delivery
Date opinions and certificates, dated such Option Securities Delivery Date,
referring to the Option Securities instead of the Firm Securities, but otherwise
to the same effect as those required to be delivered at the Time of Delivery
pursuant to Sections 7(d), 7(e), 7(f), 7(g) and 7(j).
Certificates for the Firm Securities and the Option Securities so to be
delivered will be in good delivery form, and in such denominations and
registered in such names as you may request not less than 48 hours prior to the
Time of Delivery and the Option Securities Delivery Date, respectively. Such
certificates will be made available for checking and packaging in New York, New
York, at least 24 hours prior to the Time of Delivery and Option Securities
Delivery Date.
5. The Company agrees with the Underwriter:
(a) If the Registration Statement has not become effective, to file promptly the
Final Amendment with the Commission and use its best efforts to cause the
Registration Statement to become effective; if the Registration Statement has
become effective, to promptly file the Rule 430A Prospectus or a Term Sheet with
the Commission; to make no further amendment or any supplement to the
Registration Statement or the Prospectus which shall be reasonably disapproved
by you after reasonable notice thereof; to advise you, promptly after it
receives notice thereof of the time when the Registration Statement, or any
amendment thereto, or any amended Registration Statement has become effective or
any supplement to the Prospectus or any amended Prospectus or Term Sheet has
been filed, of the issuance by the Commission of any stop order or of any order
preventing or suspending the use of any Preliminary Prospectus or the
Prospectus, of the suspension of the qualification of the Securities for
offering or sale in any jurisdiction, of the initiation or threatening of any
proceeding for any such purpose, or of any request by the Commission for the
amending or supplementing of the Registration Statement or the Prospectus or for
additional information; and in the event of the issuance of any stop order or of
any order preventing or suspending the use of any Preliminary Prospectus or the
Prospectus or suspending any such qualification, to use promptly its best
efforts to obtain withdrawal of such order;
(b) To promptly from time to time take such action as you may reasonably request
to qualify the Securities for offering and sale under the securities laws of
such jurisdictions as you may request and to comply with such laws so as to
permit the continuance of sales and dealings therein in such jurisdictions for
as long as may be necessary to complete the distribution, provided that in
connection therewith the Company shall not be required to qualify as a foreign
corporation or to file a general consent to service of process in any
jurisdiction;
(c) To furnish the Underwriter with copies of the Registration Statement (two of
which will be signed and will include all exhibits), each Preliminary
Prospectus, the Prospectus and all amendments or supplements thereto in such
quantities and in such form or forms as you may from time to time reasonably
request, and if the delivery of a prospectus is required by law in connection
with sales of Securities at any time prior to the expiration of nine months
after the time of issue of the Prospectus and if at such time any event shall
have occurred as a result of which the Prospectus
-10-
as then amended or supplemented would include an untrue statement of a material
fact or omit to state any material fact necessary in order to make statements
therein, in the light of the circumstances under which they were made when such
Prospectus is delivered, not misleading, or if for any other reason it shall be
necessary to amend or supplement the Prospectus in order to comply with the Act,
to notify you and, if the Company so determines or upon your request, to prepare
and furnish without charge to each Underwriter and to any dealer in securities
as many copies as you may from time to time reasonably request of an amended
Prospectus or a supplement to the Prospectus which will correct such statement
or omission or effect such compliance (which you and any dealer shall thereafter
be obligated to use); and in case the Underwriter is required to deliver a
prospectus in connection with sales of any of the Securities at any time nine
months or more after the time of issue of the Prospectus, upon your request but
at your expense, to prepare and deliver to you as many copies as you may request
of an amended or supplemented Prospectus complying with Section 10(a)(3) of the
Act; without limiting the application of this Section 5(c), the Company, not
later than (A) 6:00 P.M., New York City time, on the date of determination of
the public offering price, if such determination occurred at or prior to 12:00
Noon, New York City time, on such date or (B) 6:00 P.M., New York City time, on
the business day following the date of determination of the public offering
price, if such determination occurred after 12:00 Noon, New York City time, on
such date, will deliver to the Underwriter, without charge, as many copies of
the Prospectus (or any Term Sheet that forms a part thereof) and any amendment
or supplement thereto as the Representative may reasonably request for purposes
of confirming orders that are expected to settle on the Firm Closing Date;
(d) To make generally available to its stockholders as soon as practicable, but
in any event not later than 45 days after the close of the period covered
thereby, an earnings statement in form complying with the provisions of Section
11(a) of the Act and Rule 158 of the rules promulgated thereunder covering a
period of 12 consecutive months beginning not later than the first day of the
Company's fiscal quarter next following the Effective Date;
(e) To file promptly all documents required to be filed with the Commission
pursuant to Section 13, 14 or 15(d) of the Exchange Act subsequent to the
Effective Date and during any period when the Prospectus is required to be
delivered;
(f) For a period of five years from the Effective Date, to furnish to its
stockholders after the end of each fiscal year an annual report (including a
consolidated balance sheet and statements of income, cash flow and stockholders'
equity of the Company and its subsidiaries certified by independent public
accountants) and, as soon as practicable after the end of each of the first
three quarters of each fiscal year (beginning with the fiscal quarter ending
after the Effective Date), consolidated summary financial information of the
Company and its subsidiaries for such quarter in reasonable detail;
(g) For a period of three years from the Effective Date, to furnish to you
copies of all reports or other communications (financial or other) furnished to
its stockholders, and deliver to you (i) as soon as they are available, copies
of any reports and financial statements furnished to or filed with the
Commission or any national securities exchange on which any class of securities
of the Company is listed; and (ii) such additional information concerning the
business and financial condition of the Company as you may from time to time
reasonably request in connection with your obligations as an Underwriter
hereunder;
-11-
(h) That it will not take, directly or indirectly, any action designed to or
that might reasonably be expected to cause or result in stabilization or
manipulation of the price of the Common Stock to facilitate the sale or resale
of the Securities;
(i) That prior to the Time of Delivery, there will not be any change in the
capital stock or short-term debt or long-term debt of the Company or any of its
subsidiaries, or any material adverse change, or any development involving a
prospective material adverse change, in or affecting the general affairs,
management, financial position, stockholders' equity or results of operations of
the Company or any of its subsidiaries, otherwise than as set forth or
contemplated in the Prospectus; and
[(j) That it has caused the Securities to be included for quotation on the
Nasdaq National Market.
6. The Company covenants and agrees with the Underwriter that the Company will
pay or cause to be paid: (i) the fees, disbursements and expenses of counsel and
accountants for the Company, and all other expenses, in connection with the
preparation, printing and filing of the Registration Statement and the
Prospectus and (except as otherwise provided in Section 5(c) hereof) amendments
and supplements thereto and the furnishing of copies thereof, including charges
for mailing, air freight and delivery and counting and packaging thereof and of
any Preliminary Prospectus and related offering documents to the Underwriters
and dealers; (ii) the cost of printing this Agreement, and the Preliminary and
Supplemental Blue Sky Memoranda; (iii) all expenses in connection with the
qualification of the Securities for offering and sale under state securities
laws as provided in Section 5(b) hereof, including filing and registration fees
and the fees, disbursements and expenses for counsel for the Underwriter in
connection with such qualification and in connection with Blue Sky surveys; (iv)
the filing fees incident to securing any required review by the National
Association of Securities Dealers, Inc. of the terms of the sale of the
Securities; and (v) all other costs and expenses incident to the performance of
its obligations hereunder which are not otherwise specifically provided for in
this Section 6, including the fees of the Company's Transfer Agent and
Registrar, the cost of any stock issue or transfer taxes on sale of the
Securities to the Underwriter, the cost of the Company's personnel and other
internal costs, the cost of printing and engraving the certificates representing
the Securities, and all expenses and taxes incident to the sale and delivery of
the Securities to be sold by the Selling Securityholder to the Underwriter
hereunder.
It is understood, however, that, except as provided in this Section, Section 8
and Section 11 hereof, the Underwriter will pay all its own costs and expenses,
including the fees of its counsel, stock transfer taxes on resale of any of the
Securities by it, and any advertising expenses connected with any offers it may
make.
7. The obligations of the Underwriter hereunder shall be subject, in their
discretion, to the condition that all representations and warranties and other
statements of the Company and the Selling Securityholder herein are, at and as
of the Time of Delivery, true and correct, the condition that the Company and
the Selling Securityholder shall have performed all their obligations hereunder
theretofore to be performed, and the following additional conditions:
(a) The Registration Statement shall have become effective, and you shall have
received notice thereof not later than 10:00 P.M., New York City time, on the
date of execution of this Agreement, or at such other time as you and the
Company may agree; if required, the Prospectus
-12-
shall have been filed in accordance with Rule 424(b)(1), (4) or (7) of the rules
and regulations of the Commission under the Act not later than 24 hours
following the execution of this Agreement; no stop order suspending the
effectiveness of the Registration Statement shall have been issued and no
proceeding for that purpose shall have been initiated or threatened by the
Commission; and all requests for additional information on the part of the
Commission shall have been complied with to your reasonable satisfaction;
(b) All corporate proceedings and related legal and other matters in connection
with the organization of the Company and the registration, authorization, issue,
sale and delivery of the Securities shall have been reasonably satisfactory to
Fulbright & Xxxxxxxx L.L.P., counsel to the Underwriters, and Fulbright &
Xxxxxxxx L.L.P. shall have been furnished with such papers and information as
they may reasonably have requested to enable them to pass upon the matters
referred to in this subsection;
(c) You shall not have advised the Company or the Selling Securityholder that
the Registration Statement or Prospectus, or any amendment or supplement
thereto, contains an untrue statement of fact or omits to state a fact which in
your judgment is in either case material and in the case of an omission is
required to be stated therein or is necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading;
(d) Either Xxxxxx & Xxxx, L.L.P., counsel to the Company, or Xxxxxx X. Xxxxx,
Vice President and General Counsel of the Company, shall have furnished to you
their written opinion, dated the Time of Delivery, in form and substance
satisfactory to you, to the effect that:
(i) The Company has been duly and validly incorporated and is validly existing
as a corporation in good standing under the laws of the state of Mississippi,
and is qualified to do business as a foreign corporation and is in good standing
in each jurisdiction in which its ownership or leasing of properties or the
conduct of its business requires such qualification (except where the failure to
so qualify would not have a material adverse effect on the Company and its
subsidiaries as a whole); and the Company has all necessary corporate power and
all material governmental authorizations, permits and approvals required to own,
lease and operate its properties and conduct its business as described in the
Prospectus;
(ii) Each of the Company's subsidiaries has been duly and validly incorporated
and is validly existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, and is qualified to do business as a foreign
corporation and is in good standing in each jurisdiction in which its ownership
or leasing of properties or the conduct of its business requires such
qualification (except where the failure to so qualify would not have a material
adverse effect on the Company and its subsidiaries as a whole); and each such
subsidiary has all necessary corporate power to own its properties and to
conduct its business as described in the Prospectus, except as otherwise
described in the Prospectus;
(iii) All the outstanding shares of capital stock of each of the Company's
subsidiaries are validly issued and outstanding and are owned by the Company of
record and, to the knowledge of such counsel, free and clear of all liens,
charges or encumbrances of any nature whatsoever; and, to the knowledge of such
counsel, neither the Company nor any of its subsidiaries has granted any
outstanding options, warrants or commitments with respect to any shares of its
capital stock, whether issued or unissued, except as otherwise described in the
Prospectus;
-13-
(iv) The authorized, issued and outstanding capital stock of the Company is as
set forth in the Prospectus; all outstanding shares of Common Stock have been
duly authorized and validly issued and are fully paid and non-assessable, are
free of any statutory preemptive rights, and were issued and sold in compliance
with all applicable federal and state securities laws; except as described in
the Prospectus, to the knowledge of such counsel, there are no outstanding
options, warrants, or other rights calling for the issuance of, and there are no
commitments, plans or arrangements to issue, any shares of capital stock of the
Company or any security convertible into or exchangeable or exercisable for
capital stock of the Company;
(v) The Securities being sold by the Selling Securityholder have been duly and
validly authorized and, when duly countersigned by the Company's Transfer Agent
and Registrar and issued, delivered and paid for in accordance with the
provisions of this Agreement, will be validly issued, fully paid and
nonassessable and free of any statutory preemptive and, to the best knowledge of
such counsel, contractual preemptive rights, rights of first refusal or similar
rights; the Securities conform to the description of the Common Stock in the
Prospectus; and the Securities have been included for quotation on the Nasdaq
National Market;
(vi) This Agreement has been duly authorized, executed and delivered by the
Company and is a legal, valid and binding agreement of the Company enforceable
in accordance with its terms, except as enforceability of the same may be
limited by general equitable principles, bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting creditors' rights generally and
except as enforceability of those provisions relating to indemnity may be
limited by the federal securities laws and principles of public policy;
(vii) The Company has full corporate power and authority to execute, deliver
and perform this Agreement, and the execution, delivery and performance of this
Agreement, the consummation of the transactions herein contemplated and the
issue and sale of the Securities and the compliance by the Company with all the
provisions of this Agreement will not conflict with, or result in a breach 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 of the
property or assets of the Company or its subsidiaries pursuant to the terms of
any indenture, mortgage, deed of trust, loan agreement, lease or other material
agreement or instrument known to such counsel to which the Company or any of its
subsidiaries is a party and by which the Company or any of its subsidiaries is
bound or to which any of the property or assets of the Company or any of its
subsidiaries is subject, nor will such action result in any violation of the
provisions of the Certificate of Incorporation or the Bylaws (or similar
corporate constituent documents) of the Company or any of its subsidiaries, in
each case as amended to the date hereof, or, to such counsel's knowledge, any
statute, order, rule or regulation of any court or governmental agency or body
having jurisdiction over the Company or any of its subsidiaries or any of their
properties;
(viii) No consent, approval, authorization, order, registration or
qualification of or with any court or any regulatory authority or other
governmental body is required for the issue and sale of the Securities or the
consummation of the other transactions contemplated by this Agreement, (x)
except such as have been obtained under the Act and (y) such as may be required
under state securities or Blue Sky laws in connection with the purchase and
distribution of the Securities by the Underwriter, as to which no opinion is
expressed;
(ix) To such counsel's knowledge, neither the Company nor any of its
subsidiaries is currently in breach of, or in default under, any indenture,
mortgage, deed of trust, lease, bank loan or credit agreement or any other
material agreement or instrument of which such counsel has knowledge to
-14-
which the Company or any of its subsidiaries is a party or by which any of them
or any of their property may be bound or affected (in any respect that is
material in light of the financial condition of the Company and its
subsidiaries, taken as a whole);
(x) There are no preemptive or other rights to subscribe for or to purchase,
nor any restriction upon the voting or transfer of, any Securities pursuant to
the Company's Certificate of Incorporation or Bylaws, in each case as amended to
the date hereof, or any agreement or other instrument known to such counsel;
and, to such counsel's knowledge, no holders of securities of the Company have
rights to the registration thereof under the Registration Statement;
(xi) To the extent summarized therein, all contracts and loan agreements
summarized in the Registration Statement and the Prospectus are fairly
summarized therein, conform in all material respects to the descriptions thereof
contained therein, and are filed as exhibits thereto or incorporated by
reference therein; and to such counsel's knowledge, there is no contract or
document concerning the Company or any of its subsidiaries of a character
required to be described in the Prospectus or to be filed as an exhibit or
incorporated by reference in the Registration Statement, which is not so
described, filed or incorporated by reference;
(xii) To such counsel's knowledge, there is no litigation or governmental or
other action, suit, proceeding or investigation before any court or before or by
any public, regulatory or governmental agency or body pending or threatened
against, or involving the properties or business of, the Company, any of its
subsidiaries or Triad, which, if resolved against the Company, any of its
subsidiaries or Triad, individually or, to the extent involving related claims
or issues, in the aggregate, is of a character required to be disclosed in the
Prospectus which has not been properly disclosed therein; and
(xiii) The Registration Statement has become effective under the Act, the
Prospectus has been filed in accordance with Rule 424(b) of the rules and
regulations of the Commission under the Act, and, to the knowledge of such
counsel, no stop order suspending the effectiveness of the Registration
Statement has been issued and no proceedings for that purpose have been
instituted or are pending or threatened under the Act; and the Registration
Statement, the Prospectus and each amendment or supplement thereto, as of their
respective effective or issue dates, complied as to form in all material
respects with the requirements of the Act and the rules and regulations
thereunder; it being understood that such counsel need express no opinion as to
the financial statements and schedules or other financial and accounting data
contained in the Registration Statement or the Prospectus.
Xxxxxx & Xxxx, L.L.P. shall also state that nothing has come to their
attention that causes them to believe that either the Registration Statement or
the Prospectus contains any untrue statement of material fact or omits to state
a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading (except for the financial statements and related schedules and
other financial and accounting information included therein, as to which no
statement need be made).
In rendering their opinions set forth in Section 7(d) above, Xxxxxx & Xxxx,
L.L.P. and Xxxxxx X. Xxxxx may rely (a) upon certificates of state officials,
(b) as to factual matters, on certificates of the officers of the Company, and
(c) upon opinions of counsel (provided, however, that you shall have received a
copy of each of such opinions which shall be dated the Time of Delivery,
addressed to you or otherwise authorizing you to rely thereon, and that Xxxxxx &
Xxxx, L.L.P. or Xx. Xxxxx, in their or his opinion to you delivered pursuant to
this subsection, shall state that such
-15-
counsel are satisfactory to them or him and that Xxxxxx & Xxxx, L.L.P. or Xx.
Xxxxx has no reason to believe that you and they or he are not entitled to so
rely).
(e) Friday, Xxxxxxxx & Xxxxx, counsel to the Selling Securityholder, shall
have furnished to you their written opinion with respect to the Selling
Securityholder, dated the Time of Delivery, in form and substance satisfactory
to you, to the effect that:
(i) The Selling Securityholder has full corporate power to enter into this
Agreement and to sell, transfer and deliver the Securities being sold by the
Selling Securityholder hereunder; this Agreement has been duly authorized,
executed and delivered by or on behalf of the Selling Securityholder; and is a
legal, valid and binding agreement of the Selling Securityholder, enforceable in
accordance with its terms, except as enforcement of the same may be limited by
general equitable principles, bankruptcy, insolvency, reorganization, moratorium
or other similar laws affecting creditors' rights generally and except as
enforceability of those provisions relating to indemnity and contribution may be
limited by the federal securities laws and principles of public policy, and the
performance of this Agreement and the consummation of the transactions herein
contemplated will not result in a breach or violation of any of the terms or
provisions of, or constitute a default under, the certificate of incorporation,
bylaws or other constituent corporate documents of the Selling Securityholder,
or any statute, indenture, mortgage, deed of trust, loan agreement, lease,
license agreement or other agreement or instrument known to such counsel to
which the Selling Securityholder is bound; or any statute or any order, rule or
regulation known to such counsel of any court or governmental agency or body
having jurisdiction over the Selling Securityholder or the property of the
Selling Securityholder;
(ii) No consent, approval, authorization, order, registration or qualification
of or with any court or governmental agency or body is required for the
consummation of the transactions contemplated by this Agreement in connection
with the Securities being sold by the Selling Securityholder, except (x) such as
have been obtained under the Act and (y) such as may be required under the rules
of the NASD and state securities or Blue Sky laws in connection with the
purchase and distribution of such Securities by the Underwriter as to which no
opinion is expressed; and
(iii) Upon delivery of and payment for the Securities being sold by the
Selling Securityholder, the Underwriter will receive valid and unencumbered
title to such Securities, assuming it purchased such Securities without actual
knowledge of any lien, encumbrance, equity claim or other adverse claim (as such
term is defined in the New York Uniform Commercial Code).
In rendering such opinions, Friday, Xxxxxxxx & Xxxxx may rely (a) as to
factual matters, on certificates of the Selling Securityholder and of officers
of the Company, (b) upon certificates of state officials, and (c) upon opinions
of counsel (provided, however, that you shall have received a copy of each of
such opinions which shall be dated the Time of Delivery, addressed to you or
otherwise authorizing you to rely thereon, and that Friday, Xxxxxxxx & Xxxxx, in
their opinion to you delivered pursuant to this subsection, shall state that
such counsel are satisfactory to them and that Friday, Xxxxxxxx & Xxxxx has no
reason to believe that you and they are not entitled to so rely);
(f) Fulbright & Xxxxxxxx L.L.P., counsel to the Underwriter, shall have
furnished to you their written opinion or opinions, dated the Time of Delivery,
in form and substance satisfactory to you, with respect to the incorporation of
the Company, the validity of the Securities, the Registration Statement, the
Prospectus and other related matters as you may reasonably request, and such
counsel shall have received such papers and information as they may reasonably
request to enable them to pass upon such matters;
-16-
(g) At the time this Agreement is executed and also at the Time of Delivery,
Xxxxxx Xxxxxxxx LLP shall have furnished to you a letter or letters, dated the
date of this Agreement and the Time of Delivery, in form and substance
satisfactory to you, to the effect, that:
(i) They are independent accountants with respect to the Company and its
subsidiaries within the meaning of the Act and the applicable published rules
and regulations thereunder;
(ii) In their opinion, the consolidated financial statements of the Company
and its subsidiaries (including the related schedules and notes) included in the
Registration Statement and Prospectus and covered by their reports included
therein comply as to form in all material respects with the applicable
accounting requirements of the Act and the published rules and regulations
thereunder;
(iii) On the basis of specified procedures as of a specified date not more
than five days prior to the date of their letter (which procedures do not
constitute an examination made in accordance with generally accepted auditing
standards), consisting of a reading of the latest available unaudited interim
financial statements of the Company and its subsidiaries (with an indication of
the date or dates of each such latest available financial statements), a reading
of the latest available minutes of any meeting of the Board of Directors and
stockholders of the Company and its subsidiaries since June 30, 1995, inquiries
of officials of the Company who have responsibility for financial and accounting
matters subsequent to June 30, 1995, respectively, and such other procedures or
inquiries as are specified in such letter, nothing came to their attention that
caused them to believe that:
(A) the information relating to the Company and its subsidiaries for the
fiscal years ended June 30, 1991, 1992, 1993, 1994 and 1995, and any unaudited
information relating to the Company, included in the Prospectus under the
caption "Summary Financial Data" does not agree with corresponding amounts in
the audited consolidated balance sheets and the audited consolidated statements
of income and the audited statements of cash flows as of and for the periods
then ended;
(B) Any unaudited consolidated balance sheets, any unaudited consolidated
statements of operations, any unaudited consolidated statements of shareholders'
equity, and any unaudited consolidated statements of cash flow, included or
incorporated by reference in the Prospectus do not comply as to form in all
material respects with the applicable accounting requirements of the Act and the
published rules and regulations thereunder, or were not prepared on a basis
substantially consistent with that of the audited financial statements for the
year ended June 30, 1995, included or incorporated by reference in the
Prospectus;
(C) as of a specified date not more than five days prior to the date of
their letter, there was any change in the long-term debt or short-term debt of
the Company and its subsidiaries on a consolidated basis, or any decreases in
shareholders' equity, inventory, working capital or total assets of the Company,
as compared with the amounts shown in the consolidated balance sheets as of
September 30, 1995, included or incorporated by reference in the Prospectus,
except in each case for changes which the Prospectus discloses have occurred or
may occur or which are described in their letter;
(D) for the period from September 30, 1995, to a specified date not more
than five days prior to the date of such letter, there was any decrease, as
compared with the corresponding period of the preceding fiscal year, in the
following consolidated amounts: net sales, operating income, income from
continuing operations before income taxes and cumulative effect of change in
-17-
accounting principle, net income, and earnings per share of the Company and its
subsidiaries, except in all instances for decreases which the Registration
Statement discloses have occurred or may occur; or if there was any decrease,
setting forth the amount of such decrease; or if the Company and its
subsidiaries have no financial statements for any period subsequent to September
30, 1995, and other sufficient information is not available to management in
order to enable management to comment on net sales, operating income, income
from continuing operations before income taxes and cumulative effect of change
in accounting principle, net income and earnings per share of the Company and
its subsidiaries subsequent to September 30, 1995, stating that management
believes that there was no decrease in net sales, operating income, income from
continuing operations before income taxes and cumulative effect of change in
accounting principle, net income and earnings per share of the Company and its
subsidiaries for the period subsequent to September 30, 1995, as compared with
the corresponding period of the preceding fiscal year; and
(iv) in addition to the examination referred to in their reports included in
the Registration Statement and the Prospectus and the limited procedures
referred to in clause (iii) above, they have carried out certain specified
procedures, not constituting an audit, with respect to certain amounts,
percentages and financial information which are derived from the general
accounting records of the Company and its subsidiaries which appear in (a) the
Prospectus under the captions "Prospectus Summary," "Risk Factors," "Price Range
of Common Stock and Dividends" and "Selling Shareholder, (b) the Company's
Annual Report on Form 10-K (the "Form 10-K") for the fiscal year ended June 30,
1995, (c) the Company's Proxy Statement for its Annual Meeting of Stockholders
held on November 14, 1995, incorporated by reference in such Form 10-K, (d)
pages 1 and 20 through 41 of the Company's Annual Report to Stockholders for
the fiscal year ended June 30, 1995, incorporated by reference in such Form 10-
K, and (e) the Company's Quarterly Report on Form 10-Q for the quarter ended
September 30, 1995 under Items 1 and 2 of Part I, each of which is specified by
you, and have compared such amounts and financial information with the
accounting records of the Company and its subsidiaries and have found them to be
in agreement and have proved the mathematical accuracy of certain specified
percentages;
(h) (i) Neither the Company nor any of its subsidiaries shall have sustained
since June 30, 1995, any loss or interference with its business from fire,
explosion, flood or other calamity, whether or not covered by insurance, or from
any labor dispute or court or governmental action, order or decree; and (ii)
since the respective dates as of which information is given in the Prospectus,
there shall not have been any change in the capital stock or short-term debt or
long-term debt of the Company or any of its subsidiaries nor any change or any
development involving a prospective change, in or affecting the general affairs,
management, financial position, shareholders'equity or results of operations of
the Company or any of its subsidiaries, otherwise than as set forth or
contemplated in the Prospectus, the effect of which, in any such case described
in clause (i) or (ii), is in your judgment so material and adverse as to make it
impracticable or inadvisable to proceed with the public offering or the delivery
of the Securities on the terms and in the manner contemplated in the Prospectus;
(i) Between the date hereof and the Time of Delivery there shall have been no
declaration of war by the Government of the United States; at the Time of
Delivery there shall not have occurred any material adverse change in the
financial or securities markets in the United States or in political, financial
or economic conditions in the United States or any outbreak or material
escalation of hostilities or other calamity or crisis, the effect of which is
such as to make it, in the judgment of theUnderwriter, impracticable to market
the Securities or to enforce contracts for the resale of Securities and no event
shall have occurred resulting in (i) trading in securities generally
-18-
on the New York Stock Exchange or the Nasdaq National Market being suspended or
limited or minimum or maximum prices being generally established on the Nasdaq
National Market or on such exchange, or additional material governmental
restrictions, not in force on the date of this Agreement, being imposed upon
trading in securities generally by the Nasdaq National Market or such exchange
or by order of the Commission or any court or other governmental authority or
(ii) a general banking moratorium being declared by either Federal or New York
authorities;
(j) The Company and the Selling Securityholder shall have furnished or caused
to be furnished to you at the Time of Delivery certificates signed by the Chief
Executive Officer and the Chief Financial Officer, on behalf of the Company, and
the Selling Securityholder or the Selling Securityholder Attorneys, on behalf of
the Selling Securityholder, satisfactory to you as to such matters as you may
reasonably request and as to (i) the accuracy of its respective representations
and warranties herein at and as of the Time of Delivery and (ii) the performance
by the Company and the Selling Securityholder of all its respective obligations
hereunder to be performed at or prior to the Time of Delivery; the Company shall
have furnished or caused to be furnished to you at the Time of Delivery
certificates signed by the Chief Executive Officer and the Chief Financial
Officer, on behalf of the Company, as to (i) the fact that they have examined
the Registration Statement and the Prospectus and, (a) as of the Effective Date,
the statements contained or incorporated by reference in the Registration
Statement and the Prospectus were true and correct and neither the Registration
Statement nor the Prospectus omitted to state a material fact required to be
stated therein or necessary to make the statements therein not misleading and
(b) since the Effective Date, no event has occurred that is required by the Act
or the rules and regulations of the Commission thereunder to be set forth in an
amendment of, or a supplement to, the Prospectus that has not been set forth in
such an amendment or supplement; and (ii) the matters set forth in subsection
(a) of this Section 7; and
(k) The Company shall have delivered to you evidence that the Securities have
been included for quotation on the Nasdaq National Market as of the Effective
Date.
8. (a) The Company and the Selling Securityholder, jointly and severally, will
indemnify and hold harmless the Underwriter against any losses, claims, damages
or liabilities, joint or several, to which the Underwriter may become subject,
under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon (i)
any untrue statement or alleged untrue statement made by the Company in Section
1A of this Agreement, (ii) any untrue statement or alleged untrue statement of a
material fact contained or incorporated by reference in any Preliminary
Prospectus, the Registration Statement or the Prospectus, or any amendment or
supplement thereto, or in any Blue Sky application or other document executed by
the Company specifically for that purpose or based upon written information
furnished by the Company filed in any state or other jurisdiction in order to
qualify any or all of the Securities under the securities laws thereof or filed
with the Commission or any securities association or securities exchange (each,
an "Application"), or the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
made or incorporated by reference therein not misleading, or (iii) the
employment by the Company of any device, scheme or artifice to defraud, or the
engaging by the Company in any act, practice or course of business which
operates or would operate as a fraud or deceit, or any conspiracy with respect
thereto, in which the Company shall participate, in connection with the issuance
and sale of any of the Securities, and will reimburse the Underwriter for any
legal or other expenses reasonably incurred by the Underwriter in connection
with investigating, preparing to defend, defending or appearing as a third-party
witness in connection with any such action or claim; provided, however, that the
Company and the Selling Securityholder shall not be liable in any such
-19-
case to the extent that any such loss, claim, damage or liability arises out of
or is based upon an untrue statement or alleged untrue statement or omission or
alleged omission relating to the Underwriter made in any Preliminary Prospectus,
the Registration Statement, the Prospectus or such amendment or supplement or
any Application in reliance upon and in conformity with written information
furnished to the Company by the Underwriter through you expressly for use
therein; provided, further, that the indemnity agreement contained in this
Section 8(a) with respect to any Preliminary Prospectus shall not inure to the
benefit of the Underwriter (or any persons controlling the Underwriter) on
account of any losses, claims, damages, liabilities or litigation arising from
the sale of Securities to any person, if the Underwriter fails to send or give a
copy of the Prospectus, as the same may be then supplemented or amended, to such
person, within the time required by the Act and the untrue statement or alleged
untrue statement or omission or alleged omission of a material fact contained in
such Preliminary Prospectus was corrected in the Prospectus, unless such failure
is the result of noncompliance by the Company with Section 5(c) hereof. (b) The
Selling Securityholder will indemnify and hold harmless the Underwriter and the
Company against any losses, claims, damages or liabilities to which the
Underwriter or the Company may become subject under the Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon (i) any untrue statement or alleged
untrue statement made by the Selling Securityholder in Section 1B of this
Agreement, or (ii) any untrue statement or alleged untrue statement of a
material fact contained in the Preliminary Prospectus, the Registration
Statement, or the Prospectus, or any amendment or supplement thereto, or the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, in
each case to the extent, but only to the extent, that such untrue statement or
alleged untrue statement or omission or alleged omission was made in the
Preliminary Prospectus, the Registration Statement, the Prospectus or such
amendment or supplement in reliance upon and in conformity with written
information furnished to the Underwriter or the Company by the Selling
Securityholder expressly for use therein, and will reimburse the Underwriter or
the Company for any legal or other expenses reasonably incurred by the
Underwriter, the Company in connection with investigating, preparing to defend,
defending or appearing as a third-party witness in connection with any such
action or claim; provided, however, that the indemnity agreement contained in
this Section 8(b) with respect to any Preliminary Prospectus shall not inure to
the benefit of the Underwriter (or any persons controlling the Underwriter) on
account of any losses, claims, damages, liabilities or litigation arising from
the sale of Securities to any person, if the Underwriter fails to send or give a
copy of the Prospectus, as the same may be then supplemented or amended, to such
person, within the time required by the Act and the untrue statement or alleged
untrue statement or omission or alleged omission of a material fact contained in
such Preliminary Prospectus was corrected in the Prospectus, unless such failure
is the result of noncompliance by the Company with Section 5(c) hereof.
(c) In addition to any obligations of the Company and the Selling
Securityholder under Section 8(a) and 8(b), the Company and the Selling
Securityholder agree that they shall perform their indemnification obligations
under Section 8(a) and Section 8(b) (as modified by the last paragraph of this
Section 8(c)) with respect to counsel fees and expenses and other expenses
reasonably incurred by making payments within 45 days to the Underwriter in the
amount of the statements of the Underwriter's counsel or other statements which
shall be forwarded by the Underwriter, and that it shall make such payments
notwithstanding the absence of a judicial determination as to the propriety and
enforceability of the obligation to reimburse the Underwriter for such expenses
and the possibility that such payments might later be held to have been improper
by a court until such time as a court orders return of such payments.
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The indemnity agreement in Section 8(a) and Section 8(b) shall be in addition
to any liability which the Company or the Selling Securityholder may otherwise
have and shall extend upon the same terms and conditions to each person, if any,
who controls the Underwriter within the meaning of the Act or the Exchange Act.
In no event shall the Selling Securityholder be required pursuant to the
indemnity agreement under Section 8(a) and 8(b) to pay a total amount in excess
of the net amount received by the Selling Securityholder hereunder for the sale
of Securities to the Underwriter.
(d) The Underwriter will indemnify and hold harmless the Company and the
Selling Securityholder against any losses, claims, damages or liabilities to
which the Company or the Selling Securityholder may become subject, under the
Act or otherwise, insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of or are based upon an untrue statement
or alleged untrue statement of a material fact contained in any Preliminary
Prospectus, the Registration Statement or the Prospectus, or any amendment or
supplement thereto, or any Application, or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, in
each case to the extent, but only to the extent, that such untrue statement or
alleged untrue statement or omission or alleged omission was made in any
Preliminary Prospectus, the Registration Statement, the Prospectus or such
amendment or supplement or any Application in reliance upon and in conformity
with written information furnished to the Company or the Selling Securityholder
by the Underwriter relating to the Underwriter expressly for use therein, and
will reimburse the Company or the Selling Securityholder for any legal or other
expenses reasonably incurred by the Company or the Selling Securityholder in
connection with investigating or defending any such action or claim.
The indemnity agreement in this Section 8(d) shall be in addition to any
liability which the Underwriter may otherwise have and shall extend, upon the
same terms and conditions, to each officer and director of the Company or of the
Selling Securityholder and to each person, if any, who controls the Company or
the Selling Securityholder within the meaning of the Act or the Exchange Act.
(e) Promptly after receipt by an indemnified party under Section 8(a), 8(b) or
8(d) of notice of the commencement of any action (including any governmental
investigation), such indemnified party shall, if a claim in respect thereof is
to be made against the indemnifying party under such subsection, notify the
indemnifying party in writing of the commencement thereof; but the omission so
to notify the indemnifying party shall not relieve it from any liability which
it may have to any indemnified party under Section 8(a), 8(b) or 8(d) except to
the extent it was unaware of such action and has been prejudiced in any material
respect by such failure or from any liability which it may have to any
indemnified party otherwise than under such Section 8(a), 8(b) or 8(d). In case
any such action shall be brought against any indemnified party and it shall
notify the indemnifying party of the commencement thereof, the indemnifying
party shall be entitled to participate therein and, to the extent that it shall
wish, jointly with any other indemnifying party similarly notified, to assume
the defense thereof, with counsel satisfactory to such indemnified party, and
after notice from the indemnifying party to such indemnified party of its
election so to assume the defense thereof, the indemnifying party shall not be
liable to such indemnified party under such subsection for any legal or other
expenses subsequently incurred by such indemnified party in connection with the
defense thereof other than reasonable costs of investigation. If, however, (i)
the indemnifying party has authorized the employment of counsel for the
indemnified party at the expense of the indemnifying party or (ii) an
indemnified party shall have reasonably concluded that representation of such
-21-
indemnified party and the indemnifying party by the same counsel would be
inappropriate under applicable standards of professional conduct due to actual
or potential differing interests between them and the indemnified party so
notifies the indemnifying party, then the indemnified party shall be entitled to
employ counsel different from counsel for the indemnifying party at the expense
of the indemnifying party and the indemnifying party shall not have the right to
assume the defense of such indemnified party. In no event shall the indemnifying
parties be liable for fees and expenses of more than one counsel (in addition to
local counsel) for all indemnified parties in connection with any one action or
separate but similar or related actions in the same jurisdiction arising out of
the same set of allegations or circumstances. The counsel with respect to which
fees and expenses shall be so reimbursed shall be designated in writing by the
Underwriter in the case of parties indemnified pursuant to Section 8(a) and
Section 8(b) and by the Company in the case of parties indemnified pursuant to
Section 8(d).
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.
(f) In order to provide for just and equitable contribution under the Act in
any case in which (i) the Underwriter (or any person who controls the
Underwriter within the meaning of the Act or the Exchange Act) makes claim for
indemnification pursuant to Section 8(a) or Section 8(b) hereof, but is
judicially determined (by the entry of a final judgment or decree by a court of
competent jurisdiction and the expiration of time to appeal or the denial of the
last right of appeal) that such indemnification may not be enforced in such case
notwithstanding the fact that Section 8(a) or Section 8(b) provides for
indemnification in such case or (ii) contribution under the Act may be required
on the part of the Underwriter or any such controlling person in circumstances
for which indemnification is provided under Section 8(d), then, and in each such
case, the Company, the Selling Securityholder and the Underwriter shall
contribute to the aggregate losses, claims, damages or liabilities to which they
may be subject as an indemnifying party hereunder (after contribution from
others) in such proportion so that the Underwriter is responsible for the
portion represented by the percentage that the underwriting discount appearing
on the cover page of the Prospectus bears to the public offering price appearing
thereon and the Selling Securityholder and the Company shall be jointly and
severally responsible for the portion represented by the percentage that the
total net proceeds of the offering received by the Selling Securityholder bears
to the total public offering price appearing on the cover page of the
Prospectus; provided, however, that, in any such case, (x) the Underwriter shall
not be required to contribute any amount in excess of the underwriting discount
applicable to the Securities purchased by the Underwriter, (y) the Selling
Securityholder shall not in any case be required to contribute an amount in
excess of the proceeds of the offering received by such Selling Securityholder,
and (z) no person guilty of a fraudulent misrepresentation (within the meaning
of Section 11(f) of the Act) shall be entitled to a contribution from any person
who was not guilty of such fraudulent misrepresentation. The amount paid or
payable by the Underwriter as result of this Section 8(f) shall be deemed to
include any legal or other expenses reasonably incurred by the Underwriter in
connection with investigating, preparing to defend or defending any such claim.
(g) Promptly after receipt by any party to this Agreement of notice of the
commencement of any action, suit or proceeding, such party will, if a claim for
contribution in respect thereof is to be made against another party (the
"contributing party"), notify the contributing party of the commencement
thereof; but the omission so to notify the contributing party will not relieve
it from any liability
-22-
which it may have to any other party for contribution under the Act except to
the extent it was unaware of such action and has been prejudiced in any material
respect by such failure or from any liability which it may have to any other
party other than for contribution under the Act. In case any such action, suit
or proceeding is brought against any party, and such party notifies a
contributing party of the commencement thereof, the contributing party will be
entitled to participate therein with the notifying party and any other
contributing party similarly notified.
9. The respective indemnities, agreements, representations, warranties and
other statements of the Company, the Selling Securityholder and the Underwriter,
as set forth in this Agreement or made by or on behalf of them, respectively,
pursuant to this Agreement, shall remain in full force and effect, regardless of
any investigation (or any statement as to the results thereof) made by or on
behalf of the Underwriter or any controlling person of the Underwriter, or the
Company, or an officer or director or controlling person of the Company or the
Selling Securityholder, and shall survive delivery of and payment for the
Securities.
10. This Agreement shall become effective (a) if the Registration Statement
has not heretofore become effective, at the earlier of 12:00 Noon, New York City
time, on the first full business day after the Registration Statement becomes
effective, or at such time after the Registration Statement becomes effective as
you may authorize the sale of the Securities to the public by the Underwriter or
other securities dealers, or (b) if the Registration Statement has heretofore
become effective, at the earlier of 24 hours after the filing of the Prospectus
with the Commission or at such time as you may authorize the sale of the
Securities to the public, unless, prior to any such time you shall have received
notice from the Selling Securityholder that it elects that this Agreement shall
not become effective, or you, shall have given notice to the Company and the
Selling Securityholder that you elect that this Agreement shall not become
effective; provided, however, that the provisions of this Section 10 and Section
6 and Section 8 hereof shall at all times be effective.
If this Agreement, by election of the Underwriter, shall not become effective
pursuant to the provisions of this Section, the Company and the Selling
Securityholder shall not then be under any liability to the Underwriter except
as provided in Section 6 and Section 8 hereof, but if this Agreement becomes
effective and is not so terminated but the Securities are not delivered by or on
behalf of the Selling Securityholder as provided herein because the Company or
the Selling Securityholder has been unable for any reason beyond its control and
not due to any default by it to comply with the terms and conditions hereof, the
Company will reimburse the Underwriter, for all out-of-pocket expenses approved
in writing by the Underwriter, including fees and disbursements of counsel,
reasonably incurred by the Underwriter in making preparations for the purchase,
sale and delivery of the Securities, but the Company and the Selling
Securityholder shall then be under no further liability to the Underwriter
except as provided in Section 6 and Section 8 hereof.
11. All statements, requests, notices and agreements hereunder shall be in
writing or by written telecommunication, and shall be sufficient in all respects
if delivered or sent by registered mail, if to the Underwriter in care of
Xxxxxxxx Xxxxxxxx & Co. Incorporated at 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000, Attention: Syndicate Department; and if to the Company or the Selling
Securityholder, to Mississippi Chemical Corporation, Xxxx Xxxxxx Xxx 000, Xxxxx
Xxxx, XX 00000-0000, Attention: Xxxxxxx X. Xxxx, President and Chief Executive
Officer.
12. This Agreement shall be binding upon, and inure solely to the benefit of,
the Underwriter, the Company and the Selling Securityholder and, to the extent
provided in Section 8 and Section 9 hereof, the officers and directors of the
Company and each person who controls the Company or the Underwriter, and their
respective heirs, executors, administrators, successors and assigns, and no
-23-
other person shall acquire or have any right under or by virtue of this
Agreement. No purchaser of any of the Securities from the Underwriter shall be
deemed a successor or assign by reason merely of such purchase.
13. Time shall be of the essence of this Agreement.
14. This Agreement shall be construed in accordance with the laws of the state
of New York.
15. This Agreement may be executed by any one or more of the parties hereto in
any number of counterparts, each of which shall be deemed to be an original, but
all such counterparts shall together constitute one and the same instrument.
If the foregoing is in accordance with your understanding, please sign and
return to us a counterpart hereof, and upon the acceptance hereof by you, this
letter and such acceptance hereof shall constitute a binding agreement among
you, the Company and the Selling Securityholder.
Very truly yours,
MISSISSIPPI CHEMICAL CORPORATION
By:________________________________________
SF SERVICES, INC.
By:________________________________________
Accepted as of the date hereof:
XXXXXXXX XXXXXXXX & CO. INCORPORATED
By:_____________________________________________
Managing Director
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