Exhibit 1.1
DRESSER-RAND GROUP INC.
____ Shares
Common Stock, par value $0.01 per Share
Underwriting Agreement
_______, 2005
Xxxxxx Xxxxxxx & Co. Incorporated
Citigroup Global Markets Inc.
UBS Securities LLC
Bear, Xxxxxxx & Co. Inc.
Natexis Bleichroeder Inc.
Xxxxxxx & Company International
Xxxxxx Xxxx Incorporated
c/o Morgan Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Dresser-Rand Group Inc., a corporation organized under the
laws of Delaware (the "COMPANY"), proposes to issue and sell to the several
Underwriters named in Schedule I hereto (the "UNDERWRITERS"), ____ shares of the
common stock, par value $0.01 per share, of the Company (the "FIRM SHARES").
The Company also proposes to issue and sell to the several
Underwriters not more than an additional ____ shares of common stock, par value
$0.01 per share, of the Company (the "ADDITIONAL SHARES") if and to the extent
that Xxxxxx Xxxxxxx & Co. Incorporated ("XXXXXX XXXXXXX") and Citigroup Global
Markets Inc. ("CGMI", and together with Xxxxxx Xxxxxxx, the "MANAGERS"), as
Managers of the offering, shall have determined to exercise, on behalf of the
Underwriters, the right to purchase such shares of common stock granted to the
Underwriters in Section 2 hereof. The Firm Shares and the Additional Shares are
hereinafter collectively referred to as the "SHARES." The shares of common
stock, par value $0.01 per share, of the Company to be outstanding after giving
effect to the sales contemplated hereby are hereinafter referred to as the
"COMMON Stock."
The Company has filed with the Securities and Exchange
Commission (the "COMMISSION") a registration statement, including a prospectus,
relating to the Shares. The registration statement as amended at the time it
becomes effective, including the information (if any) deemed to be part of the
registration statement at the time of effectiveness pursuant to Rule 430A under
the Securities Act of 1933, as amended (the "SECURITIES ACT"), is hereinafter
referred to as the "REGISTRATION STATEMENT"; the prospectus in the form first
used to confirm
sales of Shares is hereinafter referred to as the "PROSPECTUS."
If the Company has filed an abbreviated registration statement to register
additional shares of Common Stock pursuant to Rule 462(b) under the Securities
Act (the "RULE 462 REGISTRATION STATEMENT"), then any reference herein to the
term "Registration Statement" shall be deemed to include such Rule 462
Registration Statement.
1. Representations and Warranties. The Company represents and warrants
to each Underwriter as set forth below in this Section 1:
(a) The Registration Statement has become effective; no stop order
suspending the effectiveness of the Registration Statement is in effect, and no
proceedings for such purpose are pending before or threatened by the Commission.
(b) (i) The Registration Statement, when it became effective, did not
contain and, as amended or supplemented, if applicable, will not contain any
untrue statement of a material fact or omit to state any material fact required
to be stated therein or necessary to make the statements therein not misleading,
(ii) the Registration Statement and the Prospectus comply and, as amended or
supplemented, if applicable, will comply in all material respects with the
Securities Act and the applicable rules and regulations of the Commission
thereunder and (iii) the Prospectus does not contain and, as amended or
supplemented, if applicable, will not contain any untrue statement of a material
fact or omit to state any material fact necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading; provided, however, that the Company makes no representation or
warranty as to the information contained in or omitted from the Registration
Statement or the Prospectus, or any amendment or supplement thereto, in reliance
upon and in conformity with information furnished in writing to the Company by
or on behalf of the Underwriters through the Managers specifically for inclusion
therein.
(c) The Company is not, and after giving effect to the offering and
sale of the Shares and the application of the proceeds thereof as described in
the Prospectus will not be, an "investment company" as defined in the Investment
Company Act, without taking account of any exemption arising out of the number
of holders of the Company's securities.
(d) The Company has not paid or agreed to pay to any person any
compensation for soliciting another to purchase any securities of the Company
(except as contemplated in this Agreement).
(e) Neither the Company nor any of its subsidiaries has taken or will
take, directly or indirectly, any action designed to or that has constituted or
that would reasonably be expected to cause or result, under the Exchange Act or
otherwise, in stabilization or manipulation of the price of any security of the
Company to facilitate the sale or resale of the Shares.
(f) The Company and each of its "significant subsidiaries" (as defined
in Regulation S-X under the Securities Act) has been duly incorporated or formed
and is validly existing as an entity in good standing under the laws of the
jurisdiction in which it is chartered or organized with full corporate or other
organizational power and authority to own or lease, as the case may be, and to
operate its properties and conduct its business as described in the Prospectus,
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and is duly qualified to do business as a foreign corporation or other entity
and is in good standing under the laws of each jurisdiction where the ownership
or leasing of its properties or the conduct of its business requires such
qualification except where the failure to be so incorporated or formed or
qualified, have such power or authority or be in good standing would not
reasonably be expected to have a material adverse effect on the condition
(financial or other), business, properties or results of operations of the
Company and its subsidiaries, taken as a whole (a "MATERIAL ADVERSE EFFECT").
The Company's "significant subsidiaries" are listed on Schedule II hereto.
(g) All the outstanding shares of capital stock of each significant
subsidiary of the Company have been duly authorized and validly issued and are
fully paid and nonassessable, and, except as otherwise set forth in the
Prospectus, all outstanding shares of capital stock of each significant
subsidiary of the Company are owned by the Company either directly or through
wholly owned subsidiaries free and clear of any security interest, claim, lien
or encumbrance (other than liens, encumbrances and restrictions imposed in favor
of the lenders under the Company's existing senior secured credit agreement
described in the Prospectus or permitted thereunder).
(h) (a) This Agreement has been duly authorized, executed and delivered
by the Company; (b) the shares of Common Stock outstanding prior to the issuance
of the Shares to be sold by the Company have been duly authorized and are
validly issued, fully paid and non-assessable; and (c) the Shares to be sold by
the Company have been duly authorized and, when issued and delivered in
accordance with the terms of this Agreement, will be validly issued, fully paid
and non-assessable, and the issuance of such Shares will not be subject to any
preemptive or similar rights.
(i) The authorized capital stock of the Company conforms as to legal
matters to the description thereof contained in the Prospectus.
(j) No consent, approval, authorization, filing with or order of any
court or governmental agency or body is required in connection with the
execution, delivery and performance of this Agreement (including without
limitation the issuance of the Shares), except such (i) as may be required under
the blue sky laws of any jurisdiction in which the Shares are offered and sold
or (ii) as shall have been obtained or made prior to the Closing Date.
(k) None of the execution and delivery of this Agreement, the issuance
and sale of the Shares or the consummation of any of the transactions herein
contemplated will conflict with or result in a breach or violation or imposition
of any lien, charge or encumbrance upon any property or assets of the Company or
any of its subsidiaries pursuant to (i) the charter or bylaws or other
organizational document of the Company or any of its significant subsidiaries;
(ii) the terms of any indenture, contract, lease, mortgage, deed of trust, note
agreement, loan agreement or other agreement, obligation, condition, covenant or
instrument to which the Company or any of its significant subsidiaries is a
party or bound or to which its or their property is subject; or (iii) any
statute, law, rule, regulation, judgment, order or decree of any court,
regulatory body, administrative agency, governmental body, arbitrator or other
authority having jurisdiction over the Company or any of its significant
subsidiaries or any of its or their properties other than in the case of clauses
(ii) and (iii), such breaches, violations, liens, charges
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or encumbrances that would not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect.
(l) The consolidated historical financial statements of the Company and
the combined historical financial statements of Dresser-Rand Company included in
the Prospectus present fairly the financial condition, results of operations and
cash flows of the Company and Dresser-Rand Company as of the dates and for the
periods indicated, comply as to form with the applicable accounting requirements
of the Act and have been prepared in conformity with generally accepted
accounting principles in the United States applied on a consistent basis
throughout the periods involved (except as otherwise noted therein); the
selected financial data set forth under the captions "Summary Historical and Pro
Forma Financial Information" and "Selected Historical Financial Information" in
the Prospectus fairly present, on the basis stated in the Prospectus, the
information included therein; the pro forma financial statements included in the
Prospectus include assumptions that provide a reasonable basis for presenting
the significant effects directly attributable to the offering of the Shares; the
related pro forma adjustments give appropriate effect to those assumptions; and
the pro forma financial information reflect the proper application of those
adjustments to the historical financial statement amounts in the pro forma
financial statements included in the Prospectus. The pro forma financial
statements included in the Prospectus comply as to form in all material respects
with the applicable accounting requirements of Regulation S-X under the Act. The
selected historical combined financial data as of and for the one month ended
January 31, 2000 and the eleven months ended December 31, 2000 included in the
Prospectus is correct and accurate in all material respects.
(m) No action, suit or proceeding by or before any court or
governmental agency, authority or body or any arbitrator involving the Company
or any of its subsidiaries or its or their property is pending or, to the best
knowledge of the Company, threatened that (i) would reasonably be expected to
have a Material Adverse Effect on the performance of this Agreement or the
consummation of any of the transactions contemplated hereby or (ii) would
reasonably be expected to have a Material Adverse Effect, except as set forth in
or contemplated in the Prospectus (exclusive of any amendment or supplement
thereto).
(n) Each of the Company and its subsidiaries owns or leases all such
properties as are necessary to the conduct of its operations as presently
conducted except as would not reasonably be expected to have a Material Adverse
Effect.
(o) Neither the Company nor any of its subsidiaries is in violation or
default of (i) any provision of its charter or bylaws or any equivalent
organizational document; (ii) the terms of any indenture, contract, lease,
mortgage, deed of trust, note agreement, loan agreement or other agreement,
obligation, condition, covenant or instrument to which it is a party or bound or
to which its property is subject; or (iii) any statute, law, rule, regulation,
judgment, order or decree applicable to the Company or any of its subsidiaries
of any court, regulatory body, administrative agency, governmental body,
arbitrator or other authority having jurisdiction over the Company or such
subsidiary or any of its properties, as applicable, other than in the cases of
clauses (ii) and (iii), such violations and defaults that would not reasonably
be expected to have a Material Adverse Effect.
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(p) PricewaterhouseCoopers LLP, who have audited certain financial
statements of each of the Company and Dresser-Rand Company and delivered their
reports with respect to the audited consolidated financial statements and
audited combined financial statements included in the Prospectus, is an
independent registered public accounting firm with respect to the Company and
Dresser-Rand Company within the meaning of the Act.
(q) The Company has filed all non-U.S., U.S. federal, state and local
tax returns that are required to be filed or has requested extensions thereof
(except in any case in which the failure so to file would not reasonably be
expected to have a Material Adverse Effect and except as set forth in or
contemplated in the Prospectus (exclusive of any amendment or supplement
thereto)) and has paid all taxes required to be paid by it and any other
assessment, fine or penalty levied against it, to the extent that any of the
foregoing is due and payable, except for any such assessment, fine or penalty
that is currently being contested in good faith or as would not reasonably be
expected to have a Material Adverse Effect and except as set forth in or
contemplated in the Prospectus (exclusive of any amendment or supplement
thereto).
(r) No labor problem or dispute with the employees of the Company or
any of its subsidiaries exists or, to the Company's knowledge, is threatened or
imminent, and the Company is not aware of any existing or imminent labor
disturbance by its employees or any of its or its subsidiaries' employees,
except as would not reasonably be expected to have a Material Adverse Effect and
except as set forth in or contemplated in the Prospectus (exclusive of any
amendment or supplement thereto).
(s) The Company and each of its subsidiaries are insured against such
losses and risks and in such amounts as are prudent and customary in the
businesses in which they are engaged or as required by law, except as would not
reasonably be expected to have a Material Adverse Effect. (t) No subsidiary of
the Company is currently prohibited, directly or indirectly, from paying any
dividends to the Company or any other subsidiary, from making any other
distribution on such subsidiary's capital stock, from repaying to the Company or
any other subsidiary any loans or advances to such subsidiary from the Company
or any other subsidiary or from transferring any of such subsidiary's property
or assets to the Company or any other subsidiary of the Company, except as
described in or contemplated in the Prospectus (exclusive of any amendment or
supplement thereto) and except for any prohibitions imposed under the Company's
existing senior secured credit agreement and the indenture governing the
Company's outstanding 7 3/8% senior subordinated notes due 2014.
(u) The Company and its subsidiaries possess all licenses,
certificates, permits and other authorizations issued by the appropriate U.S.
federal, state or non-U.S. regulatory authorities necessary to conduct their
respective businesses, except where the failure to possess such licenses,
certificates, permits and other authorizations would not reasonably be expected
to have a Material Adverse Effect, and neither the Company nor any of its
subsidiaries has received any notice of proceedings relating to the revocation
or modification of any such certificate, authorization or permit which, singly
or in the aggregate, if the subject of an unfavorable decision, ruling or
finding, would have a Material Adverse Effect, except as set forth in or
contemplated in the Prospectus (exclusive of any amendment or supplement
thereto).
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(v) Except as described in the Prospectus (exclusive of any amendment
or supplement thereto), the Company and each of its subsidiaries maintain a
system of internal accounting controls sufficient to provide reasonable
assurance that (i) transactions are executed in accordance with management's
general or specific authorizations; (ii) transactions are recorded as necessary
to permit preparation of financial statements in conformity with generally
accepted accounting principles and to maintain asset accountability; (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 the existing assets at reasonable intervals and appropriate action
is taken with respect to any differences.
(w) Except as set forth in or contemplated in the Prospectus (exclusive
of any amendment or supplement thereto), the Company and its subsidiaries are
(i) in compliance with any and all applicable non-U.S., U.S. federal, state and
local laws and regulations relating to the protection of human health and
safety, the environment or hazardous or toxic substances or wastes, pollutants
or contaminants ("ENVIRONMENTAL LAWS"); (ii) have received and are in compliance
with all permits, licenses or other approvals required of them under applicable
Environmental Laws to conduct their respective businesses; (iii) have not
received notice of any actual or potential liability under any Environmental
Law; and (iv) have not been named as a "potentially responsible party" under the
Comprehensive Environmental Response, Compensation, and Liability Act of 1980,
as amended, except where such non-compliance with Environmental Laws, failure to
receive required permits, licenses or other approvals, liability or naming as a
"potentially responsible party" would not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.
(x) Each pension plan and welfare plan established or maintained by the
Company and/or one or more of its subsidiaries is in compliance with the
currently applicable provisions of ERISA and the Code, except where
noncompliance would not reasonably be expected to have a Material Adverse
Effect; and neither the Company nor any of its subsidiaries has incurred or
could reasonably be expected to incur any withdrawal liability under Section
4201 of ERISA, any liability under Section 4062, 4063 or 4064 of ERISA or any
other liability under Title IV of ERISA that would reasonably be expected to
have a Material Adverse Effect.
(y) No forward-looking statement (within the meaning of Section 27A of
the Act and Section 21E of the Exchange Act) or presentation of market-related
or statistical data contained in the Prospectus or Registration Statement has
been made or reaffirmed without a reasonable basis or has been disclosed in
other than good faith.
(z) No holders of the Company's Common Stock have rights to include
such Common Stock in the Registration Statement.
(aa) Except as described in the Prospectus (exclusive of any amendments
or supplements thereto subsequent to the date of this Agreement), the Company
has not sold, issued or distributed any shares of Common Stock during the
six-month period preceding the date hereof, including any sales pursuant to Rule
144A under, or Regulation D or S of, the Securities Act, other than shares
issued pursuant to employee benefit plans, qualified stock option plans or other
employee compensation plans or pursuant to outstanding options, rights or
warrants.
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(bb) There is and has been no failure on the part of the Company and
any of the Company's directors or officers, in their capacities as such, to
comply with any provision of the Sarbanes Oxley Act of 2002 and the rules and
regulations promulgated in connection therewith (the "SARBANES OXLEY ACT"),
including Section 402 related to loans and Sections 302 and 906 related to
certifications, solely to the extent that the Sarbanes Oxley Act has been
applicable to the Company.
(cc) The Company and its subsidiaries own or possess, or can acquire on
reasonable terms, all material patents, patent rights, licenses, inventions,
copyrights, know-how (including trade secrets and other unpatented and/or
unpatentable proprietary or confidential information, systems or procedures),
trademarks, service marks and trade names currently employed by them in
connection with the 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 of the foregoing which,
individually or in the aggregate, if the subject of an unfavorable decision,
ruling or finding, would reasonably be expected to have a Material Adverse
Effect.
(dd) Neither the Company nor any of its subsidiaries nor, to the
knowledge of the Company, any director, officer, agent, employee or affiliate of
the Company or any of its subsidiaries is aware of or has taken any action,
directly or indirectly, that would result in a violation by such persons of the
FCPA, including, without limitation, making use of the mails or any means or
instrumentality of interstate commerce corruptly in furtherance of an offer,
payment, promise to pay or authorization of the payment of any money, or other
property, gift, promise to give, or authorization of the giving of anything of
value to any "foreign official" (as such term is defined in the FCPA) or any
foreign political party or official thereof or any candidate for foreign
political office, in contravention of the FCPA and the Company, its subsidiaries
and, to the knowledge of the Company, its affiliates have conducted their
businesses in compliance with the FCPA and have instituted and maintain policies
and procedures designed to ensure, and which are reasonably expected to continue
to ensure, continued compliance therewith. "FCPA" means Foreign Corrupt
Practices Act of 1977, as amended, and the rules and regulations thereunder.
(ee) The operations of the Company and its subsidiaries are and have
been conducted at all times in compliance with applicable financial
recordkeeping and reporting requirements of the Currency and Foreign
Transactions Reporting Act of 1970, as amended, the money laundering statutes of
all jurisdictions, the rules and regulations thereunder and any related or
similar rules, regulations or guidelines, issued, administered or enforced by
any governmental agency (collectively, the "MONEY LAUNDERING LAWS") and no
action, suit or proceeding by or before any court or governmental agency,
authority or body or any arbitrator involving the Company or any of its
subsidiaries with respect to the Money Laundering Laws is pending or, to the
best knowledge of the Company, threatened, except, in each case, as would not
reasonably be expected to have a Material Adverse Effect.
(ff) Except as specifically described in the Prospectus (exclusive of
any amendment or supplement thereto), neither the Company nor any of its
subsidiaries nor, to the knowledge of the Company, any director, officer, agent,
employee or affiliate of the Company or any of its subsidiaries is currently
subject to any U.S. sanctions administered by the Office of
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Foreign Assets Control of the U.S. Treasury Department ("OFAC"); and the Company
will not directly or indirectly use the proceeds of the offering, or lend,
contribute or otherwise make available such proceeds to any subsidiary, joint
venture partner or other person or entity, for the purpose of financing the
activities of any person currently subject to any U.S. sanctions administered by
OFAC.
Any certificate signed by any officer of the Company and delivered to
the Underwriters or counsel for the Underwriters in connection with the offering
of the Shares shall be deemed a representation and warranty by the Company, as
to matters covered thereby, to each Underwriter.
2. Agreements to Sell and Purchase. The Company hereby agrees to sell
to the several Underwriters, and each Underwriter, upon the basis of the
representations and warranties herein contained, but subject to the conditions
hereinafter stated, agrees, severally and not jointly, to purchase from the
Company at $___ a share (the "PURCHASE PRICE") the respective numbers of Firm
Shares set forth in Schedule I hereto opposite its name.
On the basis of the representations and warranties contained in this
Agreement, and subject to its terms and conditions, the Company agrees to sell
to the Underwriters the Additional Shares, and the Underwriters shall have the
right to purchase, severally and not jointly, up to ___ Additional Shares at the
Purchase Price. You may exercise this right on behalf of the Underwriters in
whole or from time to time in part by giving written notice of each election to
exercise the option not later than 30 days after the date of this Agreement. Any
exercise notice shall specify the number of Additional Shares to be purchased by
the Underwriters and the date on which such shares are to be purchased. Each
purchase date must be at least one business day after the written notice is
given and may not be earlier than the closing date for the Firm Shares nor later
than ten business days after the date of such notice. Additional Shares may be
purchased as provided in Section 4 hereof solely for the purpose of covering
over-allotments made in connection with the offering of the Firm Shares. On each
day, if any, that Additional Shares are to be purchased (an "OPTION CLOSING
DATE"), each Underwriter agrees, severally and not jointly, to purchase the
number of Additional Shares (subject to such adjustments to eliminate fractional
shares as you may determine) that bears the same proportion to the total number
of Additional Shares to be purchased on such Option Closing Date as the number
of Firm Shares set forth in Schedule I hereto opposite the name of such
Underwriter bears to the total number of Firm Shares.
The Company hereby agrees that, without the prior written consent of
the Managers on behalf of the Underwriters, it will not, during the period
ending 180 days after the date of the Prospectus, (i) offer, pledge, sell,
contract to sell, sell any option or contract to purchase, purchase any option
or contract to sell, grant any option, right or warrant to purchase, lend, or
otherwise transfer or dispose of, directly or indirectly, any shares of Common
Stock or any securities convertible into or exercisable or exchangeable for
Common Stock or (ii) enter into any swap or other arrangement that transfers to
another, in whole or in part, any of the economic consequences of ownership of
the Common Stock, whether any such transaction described in clause (i) or (ii)
above is to be settled by delivery of Common Stock or such other securities, in
cash or otherwise or (iii) file any registration statement with the Securities
and
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Exchange Commission relating to the offering of any shares of Common Stock or
any securities convertible into or exercisable or exchangeable for Common Stock.
The restrictions contained in the preceding paragraph shall not apply
to (A) the Shares to be sold hereunder, (B) the issuance by the Company of
shares of Common Stock upon the exercise of an option or warrant or the
conversion of a security outstanding on the date hereof of which the
Underwriters have been advised in writing, (C) grants, issuances or exercises
under any existing employee benefits plans or (D) the issuance of Common Stock
in connection with the acquisition of, or joint venture with, another company ;
provided that in the case of any transfer, distribution or issuance pursuant to
clause (D), (i) each distributee or recipient shall sign and deliver a lock-up
letter substantially in the form of Exhibit A hereto and (ii) the undersigned
and the recipient shall not be required to, and shall not voluntarily, file a
report under the Exchange Act, reporting a reduction in beneficial ownership of
shares of Common Stock during the restricted period referred to in the preceding
paragraph.
The Company also agrees and consents to the entry of stop transfer
instructions with the Company's transfer agent and registrar against the
transfer of shares of Common Stock except in compliance with the foregoing
restrictions.
3. Terms of Public Offering. The Company is advised by you that the
Underwriters propose to make a public offering of their respective portions of
the Shares as soon after the Registration Statement and this Agreement have
become effective as in your judgment is advisable. The Company is further
advised by you that the Shares are to be offered to the public initially at $___
a share (the "PUBLIC OFFERING PRICE") and to certain dealers selected by you at
a price that represents a concession not in excess of $___ a share under the
Public Offering Price, and such dealers may reallow, a concession, not in excess
of $___ a share, to any Underwriter or to certain other dealers.
4. Payment and Delivery. Payment for the Firm Shares shall be made to
the Company in Federal or other funds immediately available in New York City
against delivery of such Firm Shares for the respective accounts of the several
Underwriters at 10:00 a.m., New York City time, on _____, 2005, or at such other
time or such other date, not later than [5 business days after first date],
2005, as shall be designated in writing by you. The time and date of such
payment are hereinafter referred to as the "CLOSING DATE."
Payment for any Additional Shares shall be made to the Company in
Federal or other funds immediately available in New York City against delivery
of such Additional Shares for the respective accounts of the several
Underwriters at 10:00 a.m., New York City time, on the date specified in the
corresponding notice described in Section 2 or at such other time on the same or
on such other date, in any event not later than [10 business days after
expiration of shoe], 2005, as shall be designated in writing by you. The time
and date of such payment are hereinafter referred to as the "OPTION CLOSING
DATE."
The Firm Shares and Additional Shares shall be registered in such names
and in such denominations as you shall request in writing not later than one
full business day prior to the Closing Date or the applicable Option Closing
Date, as the case may be. The Firm Shares and Additional Shares shall be
delivered to you on the Closing Date or an Option Closing Date,
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as the case may be, for the respective accounts of the several Underwriters,
with any transfer taxes payable in connection with the transfer of the Shares to
the Underwriters duly paid, against payment of the Purchase Price therefor.
5. Agreements. The Company agrees with each Underwriter that:
(a) The Company will furnish to each Underwriter and to counsel for the
Underwriters, without charge, signed copies of the Registration Statement
(including exhibits thereto) and will furnish to the Underwriters during the
period referred to in paragraph (c) below, as many copies of the Prospectus and
any amendments and supplements thereto as they may reasonably request no later
than 5:00 p.m., New York City time, on the day immediately following the date
hereof.
(b) The Company will not make any amendment or supplement to the
Prospectus without the prior written consent of the Managers (not to be
unreasonably withheld or delayed).
(c) If at any time when a prospectus relating to the shares is required
to be delivered under the Act, any event occurs as a result of which, in the
opinion of counsel for the Underwriters and counsel for the Company, it is
necessary to amend or supplement the Prospectus, as then amended or
supplemented, (i) in order that the Prospectus would not include any untrue
statement of a material fact or omit to state any material fact necessary to
make the statements therein, in light of the circumstances under which they were
made, not misleading, or (ii) comply with applicable law, the Company will
promptly (A) notify the Underwriters of any such event; (B) subject to the
requirements of paragraph (b) of this Section 5, prepare an amendment or
supplement that will correct such statement or omission or effect such
compliance; and (C) supply any supplemented or amended Prospectus to the several
Underwriters and counsel for the Underwriters without charge in such quantities
as they may reasonably request.
(d) The Company will arrange, if necessary, for the qualification of
the Shares for sale by the Underwriters under the laws of such jurisdictions as
the Underwriters may designate and will maintain such qualifications in effect
so long as required for the sale of the Shares; provided that in no event shall
the Company be obligated to qualify to do business in any jurisdiction where it
is not now so qualified or to take any action that would subject it to service
of process in suits, other than those arising out of the offering or sale of the
Shares, in any jurisdiction where it is not now so subject or to subject itself
to taxation in excess of a nominal amount in respect of doing business in any
jurisdiction. The Company will promptly advise the Underwriters of the receipt
by the Company of any notification with respect to the suspension of the
qualification of the Shares for sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose.
(e) The Company will not take, directly or indirectly, any action
designed to or which has constituted or which might reasonably be expected to
cause or result, under the Exchange Act or otherwise, in stabilization or
manipulation of the price of any security of the Company to facilitate the sale
or resale of the Shares.
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(f) The Company agrees to pay the costs and expenses relating to the
following matters: (i) the preparation, printing (or reproduction), delivery
(including postage, air freight charges and charges for counting and packaging)
and filing of copies of the preliminary Prospectus, Prospectus and the
Registration Statement, and all amendments or supplements to any of the
foregoing, as may, in each case, be reasonably requested for use in connection
with the offering and sale of the Shares; (ii) any stamp or transfer taxes in
connection with the original issuance, sale and delivery of the Shares; (iii)
the printing (or reproduction) and delivery of this Agreement and any blue sky
memorandum delivered to investors in connection with the offering of the Shares;
(iv) any registration or qualification of the Shares for offer and sale under
the securities or blue sky laws of the several states and any other
jurisdictions specified pursuant to Section 5(d) (including filing fees and the
reasonable fees and expenses of counsel for the Underwriters relating to such
registration and qualification); (v) all filing fees and the reasonable fees and
disbursements of counsel to the Underwriters incurred in connection with the
review and qualification of the offering of the Shares by the National
Association of Securities Dealers, Inc.; (vi) all fees and expenses in
connection with the preparation and filing of the registration statement on Form
8-A relating to the Common Stock and all costs and expenses incident to listing
the Shares on the NYSE, (vii) the cost of printing certificates representing the
Shares; (viii) the costs and charges of any transfer agent, registrar or
depositary; (ix) the transportation and other expenses (collectively, the "ROAD
SHOW EXPENSES") incurred by or on behalf of the representatives of the Company
in connection with presentations to prospective purchasers of the Shares; (x)
the fees and expenses of the Company's accountants and the fees and expenses of
counsel (including local and special counsel) for the Company; and (xi) all
other costs and expenses incident to the performance by the Company of their
obligations hereunder; provided, however, that the Underwriters will pay
one-half of the cost of any chartered aircraft used in connection with
presentations to prospective purchasers of the Shares.
(g) The Company will use its best efforts to cause the Registration
Statement, if not effective at the Execution Time, and any amendment thereof, to
become effective. Prior to the termination of the offering of the Shares, the
Company will not file any amendment of the Registration Statement or supplement
to the Prospectus or any Rule 462(b) Registration Statement unless the Company
has furnished you a copy for your review prior to filing and will not file any
such proposed amendment or supplement to which you reasonably object. Subject to
the foregoing sentence, if the Registration Statement has become or becomes
effective pursuant to Rule 430A, or filing of the Prospectus is otherwise
required under Rule 424(b), the Company will cause the Prospectus, properly
completed, and any supplement thereto to be filed in a form approved by the
Managers with the Commission pursuant to the applicable paragraph of Rule 424(b)
within the time period prescribed and will provide evidence satisfactory to the
Managers of such timely filing. The Company will promptly advise the Managers
(1) when the Registration Statement, if not effective at the Execution Time,
shall have become effective, (2) when the Prospectus, and any supplement
thereto, shall have been filed (if required) with the Commission pursuant to
Rule 424(b) or when any Rule 462(b) Registration Statement shall have been filed
with the Commission, (3) when, prior to termination of the offering of the
Shares, any amendment to the Registration Statement shall have been filed or
become effective, (4) of any request by the Commission or its staff for any
amendment of the Registration Statement, or any Rule 462(b) Registration
Statement, or for any supplement to the Prospectus or for any additional
information, (5) of the issuance by the Commission of any stop order suspending
the
11
effectiveness of the Registration Statement or the institution or threatening of
any proceeding for that purpose and (6) of the receipt by the Company of any
notification with respect to the suspension of the qualification of the Shares
for sale in any jurisdiction or the institution or threatening of any proceeding
for such purpose. The Company will use its best efforts to prevent the issuance
of any such stop order or the suspension of any such qualification and, if
issued, to obtain as soon as possible the withdrawal thereof.
(h) The Company will comply with all applicable securities and other
applicable laws, rules and regulations, including, without limitation, the
Sarbanes Oxley Act, and to use its best efforts to cause the Company's directors
and officers, in their capacities as such, to comply with such laws, rules and
regulations, including, without limitation, the provisions of the Sarbanes Oxley
Act.
(i) As soon as practicable, the Company will make generally available
to its security holders and to the Managers an earnings statement or statements
of the Company and its subsidiaries which will satisfy the provisions of Section
11(a) of the Act and Rule 158 under the Act.
(j) The Company will use the net proceeds received by it from the sale
of the Shares in the manner specified in the Prospectus under "Use of Proceeds."
6. Conditions to the Obligations of the Underwriters. The obligations
of the Company to sell the Shares to the Underwriters and the several
obligations of the Underwriters to purchase and pay for the Shares shall be
subject to the accuracy in all material respects of the representations and
warranties of the Company contained herein that are not qualified by materiality
and to the accuracy of the representations and warranties of the Company
contained herein that are qualified by materiality at the date hereof, the
Closing Date, and any Option Closing Date, if applicable, to the accuracy of the
statements of the Company made in any certificates pursuant to the provisions
hereof, to the performance by the Company of their respective obligations
hereunder and to the following additional conditions:
(a) The Company shall have requested and caused (i) Xxxxxxx Xxxxxxx &
Xxxxxxxx LLP, counsel for the Company, to furnish to the Underwriters their
opinion and negative assurance statement, each dated the Closing Date and, if
applicable, any Option Closing Date, and addressed to the Underwriters and
substantially in the form of Exhibits B and C hereto; (ii) Xxxxx X. Xxxxxxxxx,
General Counsel of the Company, to furnish to the Underwriters his opinion dated
the Closing Date and, if applicable, any Option Closing Date, addressed to the
Underwriters and substantially in the form of Exhibit D hereto; and (iii)
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP, special environmental counsel for the
Company, to furnish to the Underwriters their negative assurance letter as to
certain specified environmental disclosure dated the Closing Date and, if
applicable, any Option Closing Date, and addressed to the Underwriters and
substantially in the form of Exhibit E hereto.
(b) The Underwriters shall have received from Shearman & Sterling LLP,
counsel for the Underwriters, such opinion or opinions, dated the Closing Date
and, if applicable, any Option Closing Date, and addressed to the Underwriters,
with respect to the issuance and sale of the Shares, the Prospectus and
Registration Statement and other related matters as the
12
Underwriters may reasonably require, and the Company shall have furnished to
such counsel such documents as they request for the purpose of enabling them to
pass upon such matters.
(c) The Company shall have furnished to the Underwriters a certificate
of the Company, signed by (x) the Chairman of the Board or the President and (y)
the principal financial or accounting officer of the Company, dated the Closing
Date and, if applicable, any Option Closing Date, to the effect that the signers
of such certificate have carefully examined the Prospectus and Registration
Statement, any amendment or supplement to the Prospectus and Registration
Statement and this Agreement and that:
(i) the representations and warranties of the Company in this
Agreement that are not qualified by materiality are true and correct in
all material respects, and the representations and warranties of the
Company in this agreement that are qualified by materiality are true
and correct, in each case, on and as of the Closing Date or any Option
Closing Date, as the case may be, with the same effect as if made on
the Closing Date, or such Option Closing Date, as the case may be, and
the Company has complied with all the agreements and satisfied all the
conditions on its part to be performed or satisfied hereunder at or
prior to the Closing Date, or any Option Closing Date, as the case may
be; and
(ii) since the date of the most recent financial statements
included in the Prospectus and the Registration Statement (exclusive of
any amendment or supplement thereto), there has been no material
adverse change in the condition, financial or otherwise, or in the
earnings, business, properties or results of operations of the Company
and its subsidiaries, taken as a whole, from that set forth in the
Prospectus (exclusive of any amendments or supplements thereto
subsequent to the date of this Agreement).
(d) At the date hereof and at the Closing Date, the Company shall have
requested and caused PricewaterhouseCoopers LLP to furnish to the Underwriters a
"comfort" letter, dated as of the date hereof, and a bring-down "comfort" letter
(i) on and dated as of the Closing Date and (ii) if applicable, on and dated as
of any Option Closing Date, each in form and substance satisfactory to the
Managers, confirming that it is an independent registered public accounting firm
within the meaning of the Exchange Act and the applicable published rules and
regulations thereunder and confirming certain matters with respect to the
audited and unaudited financial statements and other financial and accounting
information contained in the Prospectus and Registration Statement; provided
that the letter delivered on the Closing Date shall use a "cut-off" date no more
than three days prior to the date of such letter.
All references in this Section 6(d) to the Prospectus and
Registration Statement include any amendment or supplement thereto at
the date of the applicable letter.
(e) The "lock-up" agreements, each substantially in the form of Exhibit
A hereto, between you and D-R Interholding, LLC, each executive officer and
director of the Company and certain affiliates of First Reserve Corporation,
listed on Schedule III hereto, relating to sales and certain other dispositions
of shares of Common Stock or certain other
13
securities, delivered to you on or before the date hereof, shall be in full
force and effect on the Closing Date.
(f) Subsequent to the execution and delivery of this Agreement and
prior to the Closing Date or, if applicable, any Option Closing Date:
(i) there shall not have occurred any downgrading, nor shall
any notice have been given of any intended or potential downgrading or
of any review for a possible change that does not indicate the
direction of the possible change, in the rating accorded any of the
Company's securities by any "nationally recognized statistical rating
organization," as such term is defined for purposes of Rule 436(g)(2)
under the Securities Act; and
(ii) there shall not have occurred any change, or any
development involving a prospective change, in the condition, financial
or otherwise, or in the earnings, business, properties or results of
operations of the Company and its subsidiaries, taken as a whole, from
that set forth in the Prospectus (exclusive of any amendments or
supplements thereto subsequent to the date of this Agreement) that, in
your judgment, is material and adverse and that makes it, in your
judgment, impracticable to market the Shares on the terms and in the
manner contemplated in the Prospectus.
(g) Prior to the Closing Date, or, if applicable, any Option Closing
Date, the Company shall have furnished to the Underwriters such further
information, certificates and documents as the Underwriters may reasonably
request.
(h) The Shares shall have been listed, subject to notice of issuance,
on the New York Stock Exchange, and satisfactory evidence of such actions shall
have been provided to the Managers.
(i) On the Closing Date, and, if applicable, any Option Closing Date,
the Registration Statement shall be effective; no stop order suspending the
effectiveness of the Registration Statement shall be in effect, and no
proceedings for such purpose shall be pending before or threatened by the
Commission.
If any of the conditions specified in this Section 6 shall not have
been fulfilled when and as provided in this Agreement, or if any of the
opinions, letters, evidence and certificates mentioned above in this Section 6
shall not be reasonably satisfactory in form and substance to the Managers and
counsel for the Underwriters, this Agreement and all obligations of the
Underwriters hereunder may be cancelled at, or at any time prior to, the Closing
Date or, if applicable, any Option Closing Date by the Underwriters. Notice of
such cancellation shall be given to the Company in writing or by telephone or
facsimile confirmed in writing.
The documents required to be delivered by this Section 6 will be
delivered at the office of counsel for the Underwriters, at 000 Xxxxxxxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, on the Closing Date.
14
7. Reimbursement of Expenses. If the sale of the Shares provided for
herein is not consummated because any condition to the obligations of the
Underwriters set forth in Section 6 hereof is not satisfied, because of any
termination pursuant to Section 10 hereof or because of any refusal, inability
or failure on the part of any Company to perform any agreement herein or comply
with any provision hereof other than by reason of a default by any of the
Underwriters, including any default pursuant to Section 9 hereof, the Company
will reimburse the Underwriters severally through the Managers on demand for all
reasonable expenses (including reasonable fees and disbursements of counsel)
that shall have been incurred by them in connection with the proposed purchase
and sale of the Shares.
8. Indemnification and Contribution. (a) The Company agrees to
indemnify and hold harmless each Underwriter, the directors, officers and
Affiliates of each Underwriter and each person who controls any Underwriter
within the meaning of either the Act or the Exchange Act against any and all
losses, claims, damages or liabilities, joint or several, to which they or any
of them may become subject under the Act, the Exchange Act or other U.S. federal
or state statutory law or regulation, at common law or otherwise, insofar as
such losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon any untrue statement or alleged untrue statement
of a material fact contained in the Registration Statement, any preliminary
prospectus or the Prospectus, or in any amendment or supplement thereto or arise
out of or are based upon the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading, and (subject to the limitations set forth in the proviso to this
sentence) agree to reimburse each such indemnified party, as incurred, for any
legal or other expenses reasonably incurred by it in connection with
investigating or defending any such loss, claim, damage, liability or action;
provided, however, that the Company will not be liable in any such case to the
extent that any such loss, claim, damage or liability arises out of or is based
upon any such untrue statement or alleged untrue statement or omission or
alleged omission made in the Registration Statement, any preliminary prospectus
or the Prospectus, or in any amendment or supplement thereto, in reliance upon
and in conformity with written information furnished to the Company by or on
behalf of any Underwriter through the Managers specifically for inclusion
therein; provided further that with respect to any untrue statement or omission
of material fact made in the any preliminary prospectus, the indemnity agreement
contained in this Section 8(a) shall not inure to the benefit of any Underwriter
from whom such person asserting such loss, claim, damage or liability purchased
the Shares concerned, to the extent that any such loss, claim, damage or
liability of such Underwriter occurs under the circumstance where (i) the
Company had previously furnished copies of the Prospectus on a timely basis to
the Managers, (ii) the untrue statement or omission of a material fact contained
in any preliminary prospectus was corrected in the Prospectus and (iii) there
was not sent or given to such person, at or prior to the written confirmation of
the sale of such Shares to such person, a copy of the Prospectus. This indemnity
agreement will be in addition to any liability that the Company may otherwise
have. The Company shall not be liable under this Section 8 to any indemnified
party regarding any settlement or compromise or consent to the entry of any
judgment with respect to any pending or threatened claim, action, suit or
proceeding in respect of which indemnification or contribution may be sought
hereunder (whether or not the indemnified parties are actual or potential
parties to such claim or action) unless such settlement,
15
compromise or consent is consented to by the Company, which consent shall not be
unreasonably withheld.
(b) Each Underwriter severally, and not jointly, agrees to indemnify
and hold harmless the Company, its directors, officers and Affiliates, and each
person who controls the Company within the meaning of either the Act or the
Exchange Act, to the same extent as the foregoing indemnity from the Company to
each Underwriter, but only with reference to written information relating to
such Underwriter furnished to the Company by or on behalf of such Underwriter
through the Managers specifically for inclusion in the Registration Statement,
any preliminary prospectus or the Prospectus (or in any amendment or supplement
thereto). This indemnity agreement will be in addition to any liability that any
Underwriter may otherwise have. The Company acknowledges that, under the heading
"Underwriting," the table after the first paragraph, the third paragraph, the
seventh paragraph and the twelfth paragraph in any preliminary prospectus and
the Prospectus constitute the only information furnished in writing by or on
behalf of the Underwriters for inclusion in the Registration Statement, any
preliminary prospectus or the Prospectus or in any amendment or supplement
thereto.
(c) Promptly after receipt by an indemnified party under this Section 8
of notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against the indemnifying party under this
Section 8, notify the indemnifying party in writing of the commencement thereof;
but the failure so to notify the indemnifying party (i) will not relieve it from
liability under paragraph (a) or (b) above unless and to the extent it did not
otherwise learn of such action and such failure results in the forfeiture by the
indemnifying party of substantial rights and defenses and (ii) will not, in any
event, relieve the indemnifying party from any obligations to any indemnified
party other than the indemnification obligation provided in paragraph (a) or (b)
above. The indemnifying party shall be entitled to appoint counsel (including
local counsel) of the indemnifying party's choice at the indemnifying party's
expense to represent the indemnified party in any action for which
indemnification is sought (in which case the indemnifying party shall not
thereafter be responsible for the fees and expenses of any separate counsel,
other than local counsel if not appointed by the indemnifying party, retained by
the indemnified party or parties except as set forth below); provided, however,
that such counsel shall be reasonably satisfactory to the indemnified party.
Notwithstanding the indemnifying party's election to appoint counsel (including
local counsel) to represent the indemnified party in an action, the indemnified
party shall have the right to employ separate counsel (including local counsel),
and the indemnifying party shall bear the reasonable fees, costs and expenses of
such separate counsel if (i) the use of counsel chosen by the indemnifying party
to represent the indemnified party would present such counsel with a conflict of
interest (based on the advise of counsel to the indemnified person); (ii) such
action includes both the indemnified party and the indemnifying party and the
indemnified party shall have reasonably concluded (based on the advise of
counsel to the indemnified person) that there may be legal defenses available to
it and/or other indemnified parties that are different from or additional to
those available to the indemnifying party; (iii) the indemnifying party shall
not have employed counsel reasonably satisfactory to the indemnified party to
represent the indemnified party within a reasonable time after notice of the
institution of such action; or (iv) the indemnifying party shall authorize the
indemnified party to employ separate counsel at the expense of the indemnifying
party. It is understood and agreed that the indemnifying party
16
shall not, in connection with any proceeding or related proceeding in the same
jurisdiction, be liable for the reasonable fees and expenses of more than one
separate firm (in addition to any local counsel) for all indemnified parties.
Any such separate firm for any Underwriter, its directors, officers and
Affiliates and any control person shall be designated in writing by the Managers
and any such separate firm for any of the Company, its directors, officers and
Affiliates and any control person shall be designated in writing by the Company.
An indemnifying party will not, without the prior written consent of the
indemnified parties, settle or compromise or consent to the entry of any
judgment with respect to any pending or threatened claim, action, suit or
proceeding in respect of which indemnification or contribution may be sought
hereunder (whether or not the indemnified parties are actual or potential
parties to such claim or action) unless such settlement, compromise or consent
includes an unconditional release of each indemnified party from all liability
arising out of such claim, action, suit or proceeding and does not include any
statement as to, or any admission of, fault, culpability or failure to act by or
on behalf of any indemnified party.
(d) In the event that the indemnity provided in paragraph (a) or (b) of
this Section 8 is unavailable to or insufficient to hold harmless an indemnified
party for any reason, the Company and the Underwriters severally agree to
contribute to the aggregate losses, claims, damages and liabilities (including
legal or other expenses reasonably incurred in connection with investigating or
defending any loss, claim, damage, liability or action) (collectively, "LOSSES")
to which the Company and one or more of the Underwriters may be subject in such
proportion as is appropriate to reflect the relative benefits received by the
Company on the one hand and by the Underwriters on the other from the offering
of the Shares; provided, however, that in no case shall any Underwriter be
responsible for any amount in excess of the purchase discount or commission
applicable to the Shares purchased by such Underwriter hereunder. If the
allocation provided by the immediately preceding sentence is unavailable for any
reason, the Company and the Underwriters severally shall contribute in such
proportion as is appropriate to reflect not only such relative benefits but also
the relative fault of the Company on the one hand and the Underwriters on the
other in connection with the statements or omissions that resulted in such
Losses, as well as any other relevant equitable considerations. Benefits
received by the Company shall be deemed to be equal to the total net proceeds
from the offering (before deducting expenses) received by them, and benefits
received by the Underwriters shall be deemed to be equal to the total purchase
discounts and commissions. Relative fault shall be determined by reference to,
among other things, whether any untrue or alleged untrue statement of a material
fact or the omission or alleged omission to state a material fact relates to
information provided by the Company on the one hand or the Underwriters on the
other, the intent of the parties and their relative knowledge, access to
information and opportunity to correct or prevent such untrue statement or
omission and any other equitable considerations appropriate in the circumstance.
The Company and the Underwriters agree that it would not be just and equitable
if the amount of such contribution were determined by pro rata allocation or any
other method of allocation that does not take account of the equitable
considerations referred to above. Notwithstanding the provisions of this
paragraph (d), no person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Act) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation. The
Underwriters' obligations to contribute pursuant to this Section 8 are several
in proportion to their respective obligations and not joint. For purposes of
this Section 8, each person who
17
controls an Underwriter within the meaning of either the Act or the Exchange Act
and each director, officer, employee, Affiliate and agent of an Underwriter
shall have the same rights to contribution as such Underwriter, and each person
who controls the Company within the meaning of either the Act or the Exchange
Act and each officer and director of the Company shall have the same rights to
contribution as the Company, subject in each case to the applicable terms and
conditions of this paragraph (d).
9. Default by an Underwriter. If any one or more Underwriters shall
fail to purchase and pay for any of the Shares agreed to be purchased by such
Underwriter or Underwriters hereunder and such failure to purchase shall
constitute a default in the performance of its or their obligations under this
Agreement, the remaining Underwriters shall be obligated severally to take up
and pay for (in the respective proportions which the principal amount of Shares
set forth opposite their names in Schedule I hereto bears to the aggregate
principal amount of Shares set forth opposite the names of all the remaining
Underwriters) the Shares which the defaulting Underwriter or Underwriters agreed
but failed to purchase; provided, however, that in the event that the aggregate
principal amount of Shares which the defaulting Underwriter or Underwriters
agreed but failed to purchase shall exceed 10% of the aggregate principal amount
of Shares set forth in Schedule I hereto, the Company shall be entitled to a
further period of 36 hours within which to procure another party or parties
reasonably satisfactory to the nondefaulting Underwriter or Underwriters to
purchase no less than the amount of such unpurchased Shares that exceeds 10% of
the principal amount thereof upon such terms herein set forth. If, however, the
Company shall not have completed such arrangements within 72 hours after such
default and the principal amount of such unpurchased Shares exceeds 10% of the
principal amount of such Shares to be purchased on such date, then this
Agreement will terminate without liability to any nondefaulting Underwriter or
the Company. In the event of a default by any Underwriter as set forth in this
Section 10, the Closing Date shall be postponed for such period, not exceeding
five Business Days, as the Underwriters, the Company and its counsel shall
determine in order that the required changes in the Prospectus or in any other
documents or arrangements may be effected. Nothing contained in this Agreement
shall relieve any defaulting Underwriter of its liability, if any, to the
Company or any nondefaulting Underwriter for damages occasioned by its default
hereunder.
10. Termination. This Agreement shall be subject to termination in the
absolute discretion and in the sole judgment of the Managers, by notice given to
the Company prior to delivery of and payment for the Shares, if at any time
prior to such time (i) trading generally shall have been suspended or materially
limited on, or by, as the case may be, any of the New York Stock Exchange or the
Nasdaq National Market, (ii) trading of any securities of the Company shall have
been suspended on any exchange or in any over-the-counter market, (iii) a
material disruption in securities settlement, payment or clearance services in
the United States shall have occurred, (iv) any moratorium on commercial banking
activities shall have been declared by Federal or New York State authorities or
(v) there shall have occurred any outbreak or escalation of hostilities, or any
change in financial markets or any calamity or crisis that, in your sole
judgment, is material and adverse and which, singly or together with any other
event specified in this clause (v), makes it, in your sole judgment,
impracticable or inadvisable to proceed with the offer, sale or delivery of the
Shares on the terms and in the manner contemplated in the Prospectus (exclusive
of any amendment or supplement thereto).
18
11. No Fiduciary Duty. The Company acknowledges that in connection with
the offering of the Shares and the discussions and negotiations relating to the
price per share set forth in this Agreement: (a) the Underwriters have acted at
arm's length from, are not agents of or advisors to, and owe no fiduciary duties
to, the Company or any other person, (b) the Underwriters owe the Company only
those contractual duties and obligations set forth in this Agreement and (c) the
Underwriters may have interests that differ from those of the Company. The
Company agrees that it will not claim that the Underwriters, or any of them, has
rendered advisory services of any nature or respect, or owed or owes a fiduciary
or similar duty to the Company, in connection with such transaction or the
process leading thereto.
12. Representations and Indemnities to Survive. The respective
agreements, representations, warranties, indemnities and other statements of the
Company or its officers and of the Underwriters set forth in or made pursuant to
this Agreement will remain in full force and effect, regardless of any
investigation made by or on behalf of the Underwriters or the Company or any of
the indemnified persons referred to in Section 8 hereof, and will survive
delivery of and payment for the Shares. The provisions of Sections 7 and 8
hereof shall survive the termination or cancellation of this Agreement.
13. Notices. All communications hereunder will be in writing and
effective only on receipt, and, if sent to the Underwriters, will be mailed,
delivered or telefaxed to the Xxxxxx Xxxxxxx Equity Capital Markets Syndicate
Desk (fax no.: (000) 000-0000) and confirmed to Xxxxxx Xxxxxxx at 0000 Xxxxxxxx,
Xxx Xxxx, Xxx Xxxx 00000, attention of General Counsel; or, if sent to the
Company, will be mailed, delivered or telefaxed to (000) 000-0000 and confirmed
to it at Xxxx Xxxxx Xxxxx, Xxxxx, Xxx Xxxx 00000, attention of General Counsel.
14. Successors. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective successors and the
indemnified persons referred to in Section 8 hereof and their respective
successors, and no other person will have any right or obligation hereunder. No
purchaser of Shares from any Underwriters shall be deemed to be a successor
merely by reason of such purchase.
15. Applicable Law. This Agreement will be governed by and construed in
accordance with the laws of the State of New York applicable to contracts made
and to be performed within the State of New York. The parties hereto each hereby
waive any right to trial by jury in any action, proceeding or counterclaim
arising out of or relating to this Agreement.
16. Counterparts. This Agreement may be signed in one or more
counterparts (which may be delivered in original form or telecopier), each of
which when so executed shall constitute an original and all of which together
shall constitute one and the same agreement.
17. Headings. The section headings used herein are for convenience only
and shall not affect the construction hereof.
18. Definitions. The terms that follow, when used in this Agreement,
shall have the meanings indicated.
19
"ACT" shall mean the Securities Act of 1933, as amended, and the rules
and regulations of the Commission promulgated thereunder.
"AFFILIATE" shall have the meaning specified in Rule 501(b) of
Regulation D.
"BUSINESS DAY" shall mean any day other than a Saturday, a Sunday or a
legal holiday or a day on which banking institutions or trust companies are
authorized or obligated by law to close in The City of New York.
"CODE" shall mean the Internal Revenue Code of 1986, as amended.
"COMMISSION" shall mean the Securities and Exchange Commission.
"EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the Commission promulgated thereunder.
"EXECUTION TIME" shall mean the date and time that this Agreement is
executed and delivered by the parties hereto.
"INVESTMENT COMPANY ACT" shall mean the Investment Company Act of 1940,
as amended, and the rules and regulations of the Commission promulgated
thereunder.
"NASD" shall mean the National Association of Securities Dealers, Inc.
"REGULATION D" shall mean Regulation D under the Act.
20
If the foregoing is in accordance with your understanding of
our agreement, please sign and return to us the enclosed duplicate hereof,
whereupon this letter and your acceptance shall represent a binding agreement
among the Company and the several Underwriters.
Very truly yours,
DRESSER-RAND GROUP INC.
By:
---------------------------------
Name:
Title:
21
The foregoing Agreement is hereby
confirmed and accepted as of the
date first above written.
Xxxxxx Xxxxxxx & Co. Incorporated
Citigroup Global Markets Inc.
UBS Securities LLC
Bear, Xxxxxxx & Co. Inc.
Natexis Bleichroeder Inc.
Xxxxxxx & Company International
Xxxxxx Xxxx Incorporated
By: Xxxxxx Xxxxxxx & Co. Incorporated
By:
---------------------------------------
Name:
Title:
By: Citigroup Global Markets Inc.
By:
---------------------------------------
Name:
Title:
For themselves and the other several Underwriters named in Schedule I to the
foregoing Agreement.
22
SCHEDULE I
NUMBER OF FIRM SHARES
UNDERWRITER TO BE PURCHASED
-------------------------------------------------------- ---------------------
Xxxxxx Xxxxxxx & Co. Incorporated ......................
Citigroup Global Markets Inc. ..........................
UBS Securities LLC .....................................
Bear, Xxxxxxx & Co. Inc. ...............................
Natexis Bleichroeder Inc. ..............................
Xxxxxxx & Company International ........................
Xxxxxx Xxxx Incorporated ...............................
Total: ............................................
EXHIBIT A
[FORM OF LOCK-UP LETTER]
_____________, 2005
Xxxxxx Xxxxxxx & Co. Incorporated
Citigroup Global Markets Inc.
UBS Securities LLC
Bear, Xxxxxxx & Co. Inc.
Natexis Bleichroeder Inc.
Xxxxxxx & Company International
Xxxxxx Xxxx Incorporated
as representatives of the several underwriters
c/o Morgan Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, XX 00000
Dear Sirs and Mesdames:
The undersigned understands the Xxxxxx Xxxxxxx & Co. Incorporated ("XXXXXX
XXXXXXX") and Citigroup Global Markets Inc. ("CGMI") propose to enter into an
Underwriting Agreement (the "UNDERWRITING AGREEMENT") with Dresser-Rand Group
Inc., a Delaware corporation (the "COMPANY"), providing for the public offering
(the "PUBLIC OFFERING") by the several Underwriters, including Xxxxxx Xxxxxxx
and CGMI (the "UNDERWRITERS"), of ___________ shares (the "SHARES") of the
Common Stock, par value $0.01 of the Company (the "COMMON STOCK").
To induce the Underwriters that may participate in the Public Offering to
continue their efforts in connection with the Public Offering, the undersigned
hereby agrees that, without the prior written consent of Xxxxxx Xxxxxxx and CGMI
on behalf of the Underwriters, it will not, during the period commencing on the
date hereof and ending 180 days after the date of the final prospectus relating
to the Public Offering (the "PROSPECTUS"), (1) offer, pledge, sell, contract to
sell, sell any option or contract to purchase, purchase any option or contract
to sell, grant any option, right or warrant to purchase, lend, or otherwise
transfer or dispose of, directly or indirectly, any shares of Common Stock or
any securities convertible into or exercisable or exchangeable for Common Stock
or (2) enter into any swap or other arrangement that transfers to another, in
whole or in part, any of the economic consequences of ownership of Common Stock,
whether any such transaction described in clause (1) or (2) above is to be
settled by delivery of Common Stock or such other securities, in cash or
otherwise. The foregoing sentence shall not apply to transactions relating to
(A) shares of Common Stock or other securities acquired in open market
transactions after the completion of the offering of the Shares; provided that
no filing by any party under the Exchange Act shall be required or shall be
voluntarily made in connection with subsequent sales of Common Stock or other
securities
acquired in such open market transactions, (B) transfers of shares of Common
Stock or any security convertible, exchangeable for or exercisable into Common
Stock as a bona fide gift or gifts as a result of the operation of law or
testate or intestate succession, (C) transfers by the undersigned to a trust,
partnership, limited liability company or other entity, all of the beneficial
interests of which are held, directly or indirectly, by the undersigned or (D)
distributions of shares of Common Stock or any security convertible,
exchangeable for or exercisable into Common Stock to limited partners or
stockholders of the undersigned; provided that in the case of any transfer or
distribution pursuant to clause (B), (C) OR (D), (i) each donee or distributee
shall sign and deliver a lock-up letter substantially in the form of this letter
and (ii) the undersigned and recipient shall not be required to, and shall not
voluntarily, file a report under the Exchange Act, reporting a reduction in
beneficial ownership of shares of Common Stock during the restricted period
referred to in the foregoing sentence. In addition, the undersigned agrees that,
without the prior written consent of Xxxxxx Xxxxxxx and CGMI on behalf of the
Underwriters, it will not, during the period commencing on the date hereof and
ending 180 days after the date of the Prospectus, make any demand for or
exercise any right with respect to, the registration of any shares of Common
Stock or any security convertible into or exercisable or exchangeable for Common
Stock. The undersigned also agrees and consents to the entry of stop transfer
instructions with the Company's transfer agent and registrar against the
transfer of the undersigned's shares of Common Stock except in compliance with
the foregoing restrictions.
The undersigned understands that the Company and the Underwriters are
relying upon this agreement in proceeding toward consummation of the Public
Offering. The undersigned further understands that this agreement is irrevocable
and shall be binding upon the undersigned's heirs, legal representatives,
successors and assigns.
Whether or not the Public Offering actually occurs depends on a number of
factors, including market conditions. Any Public Offering will only be made
pursuant to an Underwriting Agreement, the terms of which are subject to
negotiation between the Company and the Underwriters.
Very truly yours,
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(Name)
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(Address)
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