EXECUTION COPY
Exhibit 1.1
$200,000,000
NVR, Inc.
5% Senior Notes due 2010
UNDERWRITING AGREEMENT
June 12, 2003
CREDIT SUISSE FIRST BOSTON LLC,
As Representative of the several Underwriters,
Eleven Madison Avenue,
New York, N.Y. 10010-3629
Dear Sirs:
1. Introductory. NVR, Inc., a Virginia corporation ("Company"),
proposes to issue and sell $200,000,000 principal amount of its 5% Senior Notes
due 2010 ("Offered Securities"), to be issued under an indenture, dated as of
April 14, 1998 (the "Base Indenture"), between the Company and U.S. Bank Trust
National Association, successor to The Bank of New York, as trustee (the
"Trustee"), as supplemented by a Supplemental Indenture (the "Supplemental
Indenture" and, together with the Base Indenture, the "Indenture"), between the
Company and the Trustee. The Company hereby agrees with the several Underwriters
named in Schedule A hereto ("Underwriters") as follows:
2. Representations and Warranties of the Company. The Company
represents and warrants to, and agrees with, the several Underwriters that:
(a) A registration statement (No. 333-44515), including a
prospectus, relating to the Offered Securities has been filed with the
Securities and Exchange Commission ("Commission") and has become
effective. Such registration statement, as amended at the time of this
Agreement, is hereinafter referred to as the "Registration Statement",
and the prospectus included in such Registration Statement, as
supplemented to reflect the terms of the Offered Securities and the
terms of offering thereof, as first filed with the Commission pursuant
to and in accordance with Rule 424(b) ("Rule 424(b)") under the
Securities Act of 1933 ("Act"), including all material incorporated by
reference therein, is hereinafter referred to as the "Prospectus". No
document has been or will be prepared or distributed in reliance on
Rule 434 under the Act.
(b) On its effective date, the Registration Statement conformed in
all respects to the requirements of the Act, the Trust Indenture Act of
1939 ("Trust Indenture Act") and the rules and regulations of the
Commission ("Rules and Regulations") and did not include 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, and on the date of this Agreement, the
Registration Statement conforms, and at the time of filing the
Prospectus pursuant to Rule 424(b), the Registration Statement and the
Prospectus will conform, in all material respects to the requirements
of the Act, the Trust Indenture Act and the rules and regulations of
the Commission thereunder (the "Rules and Regulations"), and neither of
such documents, as of their respective dates, as of the date of this
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Agreementand of the Closing Date include or will include any
untrue statement of a material fact or omit or will omit to state any
material fact required to be stated therein or necessary to make the
statements therein not misleading, except that the foregoing does not
apply to statements in or omissions from any of such documents based
upon written information furnished to the Company by any Underwriter
through the Representative, specifically for use therein. The
documents incorporated by reference in the Prospectus, when they
became effective or were filed with the Commission, as the case may
be, conformed in all material respects with the requirements of the
Act or the Securities Exchange Act of 1934 ("Exchange Act"), as
applicable, and the Rules and Regulations.
(c) The Company has been duly incorporated and is an existing
corporation in good standing under the laws of the State of Virginia,
with power and authority (corporate and other) to own and lease its
properties and conduct its business as described in the Prospectus; and
the Company is duly qualified to do business as a foreign corporation
in good standing in all other jurisdictions in which its ownership or
lease of property or the conduct of its business requires such
qualification, except where the failure to so qualify does not have a
material adverse effect on the financial condition, business,
properties or results of operations of the Company and its subsidiaries
taken as a whole ("Material Adverse Effect").
(d) Each subsidiary of the Company has been duly incorporated and
is an existing corporation in good standing under the laws of the
jurisdiction of its incorporation, with power and authority (corporate
and other) to own and lease its properties and conduct its business as
described in the Prospectus; and each subsidiary of the Company is duly
qualified to do business as a foreign corporation in good standing in
all other jurisdictions in which its ownership or lease of property or
the conduct of its business requires such qualification, except where
the failure to so qualify does not have a Material Adverse Effect; all
of the issued and outstanding capital stock of each subsidiary of the
Company has been duly authorized and validly issued and is fully paid
and nonassessable; and the capital stock of each subsidiary owned by
the Company, directly or through subsidiaries, is owned free from
liens, encumbrances and defects.
(e) The Base Indenture has been duly authorized and has been duly
qualified under the Trust Indenture Act; the Offered Securities have
been duly authorized; and when the Supplemental Indenture has been duly
executed and delivered by the Company and the Trustee and the Offered
Securities have been issued and authenticated in accordance with the
Indenture and delivered and paid for pursuant to this Agreement on the
Closing Date (as defined below), the Indenture will have been duly
executed and delivered, such Offered Securities will have been duly
executed, authenticated, issued and delivered and will conform to the
description thereof contained in the Prospectus and the Indenture and
such Offered Securities will constitute valid and legally binding
obligations of the Company, enforceable in accordance with their terms,
subject to bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability relating to or
affecting creditors' rights and to general equity principles.
(f) Except as disclosed in the Prospectus, there are no contracts,
agreements or understandings between the Company and any person that
would give rise to a valid claim against the Company or any Underwriter
for a brokerage commission, finder's fee or other like payment in
connection with this offering.
(g) There are no contracts, agreements or understandings between
the Company and any person granting such person the right to require
the Company to file a registration statement under the Act with respect
to any securities of the Company owned or to be owned by such person or
to require the Company to include such securities in the securities
registered pursuant to the Registration Statement or in any securities
being registered pursuant to any other registration statement filed by
the Company under the Act.
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(h) No consent, approval, authorization, or order of, or filing
with, any governmental agency or body or any court is required for the
consummation of the transactions contemplated by this Agreement in
connection with the issuance and sale of the Offered Securities by the
Company, except such as have been obtained and made under the Act and
the Trust Indenture Act and such as may be required under state
securities laws and except for the filing of the Prospectus under Rule
424(b).
(i) The execution, delivery and performance of the Indenture and
this Agreement, and the issuance and sale of the Offered Securities and
compliance with the terms and provisions thereof will not result in a
breach or violation of any of the terms and provisions of, or
constitute a default under, any statute, any rule, regulation or order
of any governmental agency or body or any court, domestic or foreign,
having jurisdiction over the Company or any subsidiary of the Company
or any of their properties, or any agreement or instrument to which the
Company or any such subsidiary is a party or by which the Company or
any such subsidiary is bound or to which any of the properties of the
Company or any such subsidiary is subject, or the charter or by-laws of
the Company or any such subsidiary, which breach, violation or default
would, if continued, have a Material Adverse Effect, and the Company
has full power and authority to authorize, issue and sell the Offered
Securities as contemplated by this Agreement.
(j) This Agreement has been duly authorized, executed and
delivered by the Company.
(k) Except as disclosed in the Prospectus, the Company and its
subsidiaries have good and marketable title to all real properties and
all other properties and assets owned by them, in each case free from
liens, encumbrances and defects that would materially affect the value
thereof or materially interfere with the use made or to be made thereof
by them; and except as disclosed in the Prospectus, the Company and its
subsidiaries hold any leased real or personal property under valid and
enforceable leases with no exceptions that would materially interfere
with the use made or to be made thereof by them.
(l) The Company and its subsidiaries possess adequate
certificates, authorities or permits issued by appropriate governmental
agencies or bodies necessary to conduct the business now operated by
them and have not received any notice of proceedings relating to the
revocation or modification of any such certificate, authority or permit
that, if determined adversely to the Company or any of its
subsidiaries, would individually or in the aggregate have a Material
Adverse Effect.
(m) No labor dispute with the employees of the Company or any
subsidiary exists or, to the knowledge of the Company, is imminent that
might have a Material Adverse Effect.
(n) The Company and its subsidiaries own, possess or can acquire
on reasonable terms, adequate trademarks, trade names and other rights
to inventions, know-how, patents, copyrights, confidential information
and other intellectual property (collectively, "intellectual property
rights") necessary to conduct the business now operated by them, or
presently employed by them, and have not received any notice of
infringement of or conflict with asserted rights of others with respect
to any intellectual property rights that, if determined adversely to
the Company or any of its subsidiaries, would individually or in the
aggregate have a Material Adverse Effect.
(o) Except as disclosed in the Prospectus, neither the Company nor
any of its subsidiaries is in violation of any statute, any rule,
regulation, decision or order of any governmental agency or body or any
court, domestic or foreign, relating to the use, disposal or release of
hazardous or toxic substances or relating to the protection or
restoration of the environment or human exposure to hazardous or toxic
substances (collectively, "environmental laws"), owns or operates any
real property contaminated with any substance that is subject to any
environmental laws, is liable for any off-site disposal or
contamination pursuant to any environmental laws, or is subject to any
claim relating to any environmental laws, which violation,
contamination, liability or claim would
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individually or in the aggregate have a Material Adverse Effect; and
the Company is not aware of any pending investigation which might lead
to such a claim.
(p) Except as disclosed in the Prospectus, there are no pending
actions, suits or proceedings against or affecting the Company, any of
its subsidiaries or any of their respective properties that, if
determined adversely to the Company or any of its subsidiaries, would
individually or in the aggregate have a Material Adverse Effect, or
would materially and adversely affect the ability of the Company to
perform its obligations under the Indenture or this Agreement, or which
are otherwise material in the context of the sale of the Offered
Securities; and no such actions, suits or proceedings are threatened
or, to the Company's knowledge, contemplated.
(q) The financial statements included in the Registration
Statement and the Prospectus present fairly the financial position of
the Company and its consolidated subsidiaries as of the dates shown and
their results of operations and cash flows for the periods shown, and,
except as otherwise disclosed in the Prospectus, such financial
statements have been prepared in conformity with the generally accepted
accounting principles in the United States applied on a consistent
basis and the schedules included in the Registration Statement present
fairly the information required to be stated therein; and the
assumptions used in preparing the pro forma financial statements
included in the Registration Statement and the Prospectus provide a
reasonable basis for presenting the significant effects directly
attributable to the transactions or events described therein, any
related pro forma adjustments give appropriate effect to those
assumptions, and the pro forma columns therein reflect the proper
application of those adjustments to the corresponding historical
financial statement amounts.
(r) Except as disclosed in the Prospectus, since the date of the
latest financial statements included in the Prospectus there has been
no material adverse change, nor any development or event involving a
prospective Material Adverse Effect, and, except as disclosed in or
contemplated by the Prospectus, there has been no dividend or
distribution of any kind declared, paid or made by the Company on any
class of its capital stock.
(s) The Company is subject to the reporting requirements of either
Section 13 or Section 15(d) of the Securities Exchange Act of 1934 and
files reports with the Commission on the Electronic Data Gathering,
Analysis, and Retrieval (XXXXX) system.
(t) The Company is not and, after giving effect to the offering
and sale of the Offered Securities 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 of 1940.
(u) Neither the Company nor any of its affiliates does business
with the government of Cuba or with any person or affiliate located in
Cuba within the meaning of Section 517.075, Florida Statutes and the
Company agrees to comply with such Section if prior to the completion
of the distribution of the Offered Securities it commences doing such
business.
3. Purchase, Sale and Delivery of Offered Securities. On the basis of
the representations, warranties and agreements herein contained, but subject to
the terms and conditions herein set forth, the Company agrees to sell to the
Underwriters, and the Underwriters agree to purchase from the Company, at a
purchase price of 100% the principal amounts of Offered Securities set forth
opposite the names of the Underwriters in Schedule A hereto.
The Company will deliver the Offered Securities to the Representative
for the accounts of the Underwriters, against payment of the purchase price the
Offered Securities in the form of one or more permanent global Securities in
definitive form (the "Global Securities") deposited with the Trustee as
custodian for The Depository Trust Company ("DTC") and registered in the name of
Cede & Co., as nominee for DTC. Interests in any permanent global Securities
will be held only in book-entry form through DTC, except in the limited
circumstances described in the Prospectus. The closing shall take place
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at the office of Xxxxxx & Xxxxxxx LLP at 9:00 A.M., (New York time), on June 17,
2003, or at such other time not later than seven full business days thereafter
as Credit Suisse First Boston LLC ("CSFB") and the Company determine, such time
being herein referred to as the "Closing Date." At the closing, payment for the
Offered Securities shall be made by the Underwriters to the Company by wire
transfer of immediately available funds to a bank account designated by the
Company, against delivery to the Trustee as custodian for DTC of the Global
Securities representing all of the Offered Securities. The Global Securities
will be made available for checking at the above office of Xxxxxx & Xxxxxxx LLP
at least 24 hours prior to the Closing Date.
4. Offering by Underwriter. It is understood that the several
Underwriters propose to offer the Offered Securities for sale to the public as
set forth in the Prospectus.
5. Certain Agreements of the Company. The Company agrees with the
several Underwriters that:
(a) The Company will file the Prospectus with the Commission
pursuant to and in accordance with Rule 424(b)(2) (or, if applicable,
subparagraph (5)) not later than the second business day following the
execution and delivery of this Agreement.
(b) The Company will advise CSFB promptly of any proposal to amend
or supplement the Registration Statement or the Prospectus and will
afford CSFB a reasonable opportunity to comment on any such proposed
amendment or supplement; and the Company will also advise CSFB promptly
of the filing of any such amendment or supplement and of the
institution by the Commission of any stop order proceedings in respect
of the Registration Statement or of any part thereof and will use its
best efforts to prevent the issuance of any such stop order and to
obtain as soon as possible its lifting, if issued.
(c) If, at any time when a prospectus relating to the Offered
Securities is required to be delivered under the Act in connection with
sales by any Underwriter or dealer, any event occurs as a result of
which the Prospectus as then amended or supplemented would include an
untrue statement of a material fact or omit to state any material fact
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, or if it is
necessary at any time to amend the Prospectus to comply with the Act,
the Company promptly will notify CSFB of such event and will promptly
prepare and file with the Commission, at its own expense, an amendment
or supplement which will correct such statement or omission or an
amendment which will effect such compliance. Neither the CSFB's consent
to, nor the Underwriters' delivery of, any such amendment or supplement
shall constitute a waiver of any of the conditions set forth in Section
6 hereof.
(d) As soon as practicable, but not later than 16 months, after
the date of this Agreement, the Company will make generally available
to its securityholders an earnings statement covering a period of at
least 12 months beginning after the later of (i) the effective date of
the registration statement relating to the Offered Securities, (ii) the
effective date of the most recent post-effective amendment to the
Registration Statement to become effective prior to the date of this
Agreement and (iii) the date of the Company's most recent Annual Report
on Form 10-K filed with the Commission prior to the date of this
Agreement, which will satisfy the provisions of Section 11(a) of the
Act.
(e) The Company will furnish to the Representative copies of the
Registration Statement in the form it became effective (two of which
will include all exhibits but none of the incorporated documents) and
of all amendments thereto, any related preliminary prospectus, any
related preliminary prospectus supplement, and, so long as a prospectus
relating to the Offered Securities is required to be delivered under
the Act in connection with sales by any Underwriter or dealer, the
Prospectus and all amendments and supplements to such documents, in
each case in such quantities as CSFB requests. The Prospectus shall be
so furnished on or prior to 3:00 P.M., New York time, on June 16, 2003.
All other documents shall be so furnished as soon as available.
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(f) The Company will arrange for the qualification of the Offered
Securities for sale and the determination of their eligibility for
investment under the laws of such jurisdictions as CSFB designates and
will continue such qualifications in effect so long as required for the
distribution.
(g) The Company will pay all expenses incident to the performance
of its obligations under this Agreement, for any filing fees and other
expenses (including fees and disbursements of counsel) incurred in
connection with qualification of the Offered Securities for sale under
the laws of such jurisdictions as CSFB designates and the printing of
memoranda relating thereto, for any fees charged by investment rating
agencies for the rating of the Offered Securities, for any travel
expenses of the Company's officers and employees and any other expenses
of the Company in connection with attending or hosting meetings with
prospective purchasers of the Offered Securities and for expenses
incurred in distributing preliminary prospectuses, preliminary
prospectus supplements and the Prospectus (including any amendments and
supplements thereto) to the Underwriter.
6. Conditions of the Obligations of the Underwriters. The obligations
of the several Underwriters to purchase and pay for the Offered Securities on
the Closing Date will be subject to the accuracy of the representations and
warranties on the part of the Company herein, to the accuracy of the statements
of Company officers made pursuant to the provisions hereof, to the performance
by the Company of its obligations hereunder and to the following additional
conditions precedent:
(a) On or prior to the Closing Date, the Representative shall have
received a letter, dated the date of delivery thereof, of KPMG LLP
confirming that they are independent public accountants within the
meaning of the Act and the applicable published Rules and Regulations
thereunder and stating to the effect that:
(i) in their opinion the financial statements and any
schedules and any summary of earnings examined by them and
included in the Prospectus comply as to form in all material
respects with the applicable accounting requirements of the
Act and the related published Rules and Regulations;
(ii) they have performed the procedures specified by the
American Institute of Certified Public Accountants for a
review of interim financial information as described in
Statement of Auditing Standards No. 71, Interim Financial
Information, on any unaudited financial statements included in
the Registration Statement;
(iii) on the basis of the review referred to in clause (ii)
above, a reading of the latest available interim financial
statements of the Company, inquiries of officials of the
Company who have responsibility for financial and accounting
matters and other specified procedures, nothing came to their
attention that caused them to believe that:
(A) the unaudited financial statements, if
any, and any summary of earnings included in the
Prospectus do not comply as to form in all material
respects with the applicable accounting requirements
of the Act and the related published Rules and
Regulations or any material modifications should be
made to such unaudited financial statements and
summary of earnings for them to be in conformity with
generally accepted accounting principles;
(B) if any unaudited "capsule" information
is contained in the Prospectus, the unaudited
consolidated net sales, net operating income, net
income and net income per share amounts or other
amounts constituting such "capsule" information and
described in such letter do not agree with the
corresponding amounts set forth in the unaudited
consolidated financial statements or were not
determined on a basis substantially consistent with
that of the corresponding amounts in the audited
statements of income;
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(C) at the date of the latest available
balance sheet read by such accountants, or at a
subsequent specified date not more than three
business days prior to the date of the such letter,
there was any change in the capital stock or any
increase in short-term indebtedness or long-term debt
of the Company and its consolidated subsidiaries or,
at the date of the latest available balance sheet
read by such accountants, there was any decrease in
consolidated net current assets or net assets, as
compared with amounts shown on the latest balance
sheet included in the Prospectus; or
(D) for the period from the closing date of
the latest income statement included in the
Prospectus to the closing date of the latest
available income statement read by such accountants
there were any decreases, as compared with the
corresponding period of the previous year, in
consolidated net sales, net operating income, per
share amounts of consolidated income before
extraordinary items or net income or in the ratio of
earnings to fixed charges;
except in all cases set forth in clauses (C) and (D) above for
changes, increases or decreases which the Prospectus discloses
have occurred or may occur or which are described in such
letter; and
(iv) they have compared specified dollar amounts (or
percentages derived from such dollar amounts) and other
financial information contained in the Prospectus (in each
case to the extent that such dollar amounts, percentages and
other financial information are derived from the general
accounting records of the Company and its subsidiaries subject
to the internal controls of the Company's accounting system or
are derived directly from such records by analysis or
computation) with the results obtained from inquiries, a
reading of such general accounting records and other
procedures specified in such letter and have found such dollar
amounts, percentages and other financial information to be in
agreement with such results, except as otherwise specified in
such letter.
All financial statements and schedules included in material
incorporated by reference into the Prospectus shall be deemed included
in the Prospectus for purposes of this subsection.
(b) The Prospectus shall have been filed with the Commission
in accordance with the Rules and Regulations and Section 5(a) of this
Agreement. No stop order suspending the effectiveness of the
Registration Statement or of any part thereof shall have been issued
and no proceedings for that purpose shall have been instituted or, to
the knowledge of the Company or any Underwriter, shall be contemplated
by the Commission.
(c) Subsequent to the execution and delivery of this
Agreement, there shall not have occurred (i) any change, or any
development or event involving a prospective change, in the condition
(financial or other), business, properties or results of operations of
the Company and its subsidiaries taken as one enterprise which, in the
judgment of a majority in interest of the Underwriters, including the
Representative, is material and adverse and makes it impractical or
inadvisable to proceed with completion of the public offering or the
sale of and payment for the Offered Securities; (ii) any downgrading in
the rating of any debt securities of the Company by any "nationally
recognized statistical rating organization" (as defined for purposes of
Rule 436(g) under the Act), or any public announcement that any such
organization has under surveillance or review its rating of any debt
securities of the Company (other than an announcement with positive
implications of a possible upgrading, and no implication of a possible
downgrading, of such rating) or any announcement that the Company has
been placed on negative outlook; (iii) any change in U.S. or
international financial, political or economic conditions or currency
exchange rates or exchange controls as would, in the judgment of the
Underwriter, be likely to prejudice materially the success of the
proposed issue, sale or distribution of the Offered Securities, whether
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in the primary market or in respect of dealings in the secondary
market; (iv) any material suspension or material limitation of trading
in securities generally on the New York Stock Exchange, or any setting
of minimum prices for trading on such exchange, or any suspension of
trading of any securities of the Company on any exchange or in the
over-the-counter market; (v) any banking moratorium declared by U.S.
Federal or New York authorities; (vi) any major disruption of
settlements of securities or clearance services in the United States
or (vii) any attack on, outbreak or escalation of hostilities or act
of terrorism involving the United States, any declaration of war by
Congress or any other national or international calamity or emergency
if, in the judgment of the Underwriter, the effect of any such attack,
outbreak, escalation, act, declaration, calamity or emergency makes it
impractical or inadvisable to proceed with completion of the public
offering or the sale of and payment for the Offered Securities.
(d) The Representative shall have received an opinion, dated
such Closing Date, of Xxxxx & Xxxxxxx L.L.P., counsel for the Company,
substantially to the effect that:
(i) The Company is validly existing as a corporation
and in good standing under the laws of the Commonwealth of
Virginia as of the Closing Date. The Company has the corporate
power to own and lease its current properties and to conduct
its business as described in the Prospectus. The Company is
authorized to transact business as a foreign corporation in
the jurisdictions set forth in the foreign qualification
certificates as specified in the opinion as of the Closing
Date.
(ii) Each of the Company's subsidiaries listed on
Exhibit 21 to the Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 2002 (each a "Subsidiary"), is
validly existing as a corporation and in good standing under
the corporation law of the jurisdiction of its incorporation
as of the Closing Date. Each Subsidiary has the corporate
power to own and lease its current properties and to conduct
its business as described in the Prospectus. Each Subsidiary
is authorized to transact business as a foreign corporation in
the jurisdictions in the foreign qualification certificates as
specified in the opinion as of the Closing Date. The issued
and outstanding capital stock of each Subsidiary has been duly
authorized and, assuming receipt of consideration therefor as
provided in resolutions authorizing issuance thereof of the
board of directors of each such Subsidiary, is validly issued,
fully paid and nonassessable under the corporation law of its
jurisdiction of incorporation, and, are owned of record by the
Company or a subsidiary of the Company, except as described in
the Prospectus.
(iii) The Indenture has been duly authorized,
executed and delivered on behalf of the Company and (assuming
due authorization, execution and delivery by the Trustee)
constitutes a valid and binding obligation of the Company,
enforceable against the Company in accordance with its terms,
subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights and
to general equity principles. The Indenture has been qualified
under the Trust Indenture Act. The Offered Securities have
been duly authorized by the Company, and, when issued and
authenticated in the manner provided for in the Indenture and
delivered against payment in accordance with this Agreement,
will constitute valid and binding obligations of the Company,
enforceable against the Company in accordance with their
terms, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights and
to general equity principles.
(iv) To such counsel's knowledge, there are no
holders of securities of the Company who, by reason of the
filing of the Registration Statement under the Securities Act,
have the right to request that the Company register under the
Securities Act the securities held by them.
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(v) No approval or consent of, or registration or
filing with, any federal agency or any State of New York or
Commonwealth of Virginia government agency under applicable
federal, New York or Virginia law is required to be obtained
or made by the Company in connection with the execution,
delivery and performance of this Agreement on the Closing Date
by the Company and the issuance and sale of the Offered
Securities on the Closing Date by the Company.
(vi) The execution, delivery and performance on the
Closing Date by the Company of the Indenture and this
Agreement, including compliance with the terms and provisions
thereof and the issuance and sale of the Offered Securities on
the Closing Date, do not (i) violate any provision of
applicable federal, New York or Virginia law, (ii) to such
counsel's knowledge, violate any court or administrative
order, judgment, or decree that names the Company or any of
its Subsidiaries and is specifically directed to them or any
of their property, (iii) breach or constitute a default under
any agreement filed as an exhibit to the annual report on Form
10-K of the Company for the fiscal year ended December 31,
2002 and the report on Form 10-Q of the Company for the
quarter ended March 31, 2003, or (iv) violate the articles or
certificate of incorporation or by-laws of the Company or any
Subsidiary.
(vii) The Company has the corporate power under its
articles of incorporation and the General Corporation Law of
the Commonwealth of Virginia to execute and deliver this
Agreement and to consummate the transactions contemplated by
this Agreement, including, without limitation, the issuance
and sale of the Offered Securities as provided in this
Agreement.
(viii) The Registration Statement has become
effective under the Act, the required filings of the
Prospectus pursuant to Rule 424(b) have been made in the
manner and within the time period required by Rule 424(b),
and, to the knowledge of such counsel, no stop order
suspending the effectiveness of the Registration Statement or
suspending or preventing the use of the Prospectus has been
issued and no proceedings for that purpose have been
instituted or are threatened by the Commission.
(ix) The Registration Statement and the Prospectus,
excluding documents incorporated by reference therein, 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 (except for the financial
statements and supporting schedules and other financial
information or data included or incorporated by reference
therein, and the exhibits to the Registration Statement and
the Statement of Eligibility of the Trustee on Form T-1, as to
which no opinion is rendered). The documents incorporated by
reference in the Registration Statement and the Prospectus
(except for the financial statements and supporting schedules
and other financial information or data included or
incorporated by reference therein, and the exhibits to the
Registration Statement and the Statement of Eligibility of the
Trustee on Form T-1, as to which no opinion is rendered), at
the time they were filed with the Securities and Exchange
Commission, complied as to form in all material respects with
the requirements of the Exchange Act and the Rules and
Regulations thereunder.
(x) This Agreement has been duly authorized, executed
and delivered on behalf of the Company.
In addition to the foregoing opinions, such counsel
shall state that, during the course of the preparation of the
Registration Statement, they participated in conferences with
officers and other representatives of the Company, with
representatives of the independent public accountants of the
Company and with the Underwriter and the Underwriter's
representatives, and while such counsel has not undertaken to
determine
9
independently, and does not assume any responsibility for, the
accuracy, completeness, or fairness of the statements in the
Registration Statement or Prospectus, on the basis of these
conferences and such counsel's activities as counsel to the Company in
connection with the Registration Statement, no facts have come to such
counsel's attention which cause such counsel to believe that (i) the
Registration Statement, at the time it became effective or as of the
date of this Agreement, contained an untrue statement of a material
fact or omitted to state a material fact required to be stated therein
or necessary to make the statements therein not misleading, or that
the Prospectus, as of the date of this Agreement or as of the Closing
Date, contained or contains an untrue statement of a material fact or
omitted or omits to state a material fact necessary in order to make
the statements therein, in the light of the circumstances under which
they were made, not misleading, (ii) there are any legal or
governmental proceedings pending or threatened against the Company
that are required to be disclosed in the Registration Statement or the
Prospectus, other than those disclosed therein, or (iii) there are any
contracts or documents of a character required to be described in the
Registration Statement or the Prospectus or to be filed as exhibits to
the Registration Statement that are not described or referred to
therein or so filed; provided that in making the foregoing statements
(which shall not constitute an opinion), such counsel does not need to
express any views as to the financial statements and supporting
schedules and other financial information and data included or
incorporated by reference in or omitted from the Registration
Statement or the Prospectus, or the Statement of Eligibility of the
Trustee on Form T-1.
(e) The Representative shall have received from Xxxxxx &
Xxxxxxx LLP, counsel for the Underwriters, such opinion or opinions,
dated such Closing Date, with respect to matters as the Representative
may require, and the Company shall have furnished to such counsel such
documents as they request for the purpose of enabling them to pass upon
such matters.
(f) The Representative shall have received a certificate,
dated such Closing Date, of the President or any Vice President and a
principal financial or accounting officer of the Company in which such
officers, to the best of their knowledge, shall state that the
representations and warranties of the Company in this Agreement are
true and correct in all material respects, that the Company has
complied with all material agreements and satisfied all conditions on
its part to be performed or satisfied hereunder at or prior to such
Closing Date, that no stop order suspending the effectiveness of the
Registration Statement or of any part thereof has been issued and no
proceedings for that purpose have been instituted or are contemplated
by the Commission and that, subsequent to the date of the most recent
financial statements in the Prospectus, there has been no material
adverse change, nor any development or event involving a prospective
material adverse change, in the financial condition, business,
properties or results of operations of the Company and its subsidiaries
taken as a whole except as set forth in or contemplated by the
Prospectus or as described in such certificate.
The Company will furnish the Representative with such conformed copies
of such opinions, certificates, letters and documents as the Representative
reasonably requests. CSFB may in its sole discretion waive on behalf of the
Underwriters compliance with any conditions to the obligations of the
Underwriters hereunder, whether in respect of an Optional Closing Date or
otherwise.
7. Indemnification and Contribution. (a) The Company will indemnify and
hold harmless each Underwriter, its partners, directors and officers and each
person, if any, who controls such Underwriter within the meaning of Section 15
of the Act, 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 any untrue statement or alleged
untrue statement of any material fact contained in the Registration Statement,
the Prospectus, or any amendment or supplement thereto, or any related
preliminary prospectus or preliminary prospectus supplement, 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, and will reimburse each Underwriter for any legal or other expenses
reasonably incurred by such Underwriter
10
in connection with investigating or defending any such loss, claim, damage,
liability or action as such expenses are incurred; 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 an untrue statement or
alleged untrue statement in or omission or alleged omission from any of such
documents in reliance upon and in conformity with written information furnished
to the Company by any Underwriter specifically for use therein, it being
understood and agreed that the only such information furnished by any
Underwriter consists of the information described as such in subsection (b)
below.
(b) Each Underwriter will severally and not jointly indemnify and hold
harmless the Company, its directors and officers and each person, if any who
controls the Company within the meaning of Section 15 of the Act, against any
losses, claims, damages or liabilities to which 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 any
untrue statement or alleged untrue statement of any material fact contained in
the Registration Statement, the Prospectus, or any amendment or supplement
thereto, or any related preliminary prospectus or preliminary prospectus
supplement, or arise out of or are based upon the omission or the 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 reliance upon and in
conformity with written information furnished to the Company by such Underwriter
through the Representative specifically for use therein, and will reimburse any
legal or other expenses reasonably incurred by the Company in connection with
investigating or defending any such loss, claim, damage, liability or action as
such expenses are incurred, it being understood and agreed that the only such
information furnished by any Underwriter consists of the third paragraph under
the caption "Underwriting" in the Prospectus Supplement (concerning selling
concessions and discounts) and the seventh and eighth paragraphs under the
caption "Underwriting" in the Prospectus Supplement (concerning the secondary
market making activities regarding stabilization and syndicate covering
transactions by the Underwriters).
(c) Promptly after receipt by an indemnified party under this Section
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
subsection (a) or (b) above, notify the indemnifying party of the commencement
thereof; but the omission so to notify the indemnifying party will not relieve
it from any liability which it may have to any indemnified party otherwise than
under subsection (a) or (b) above. In case any such action is brought against
any indemnified party and it notifies the indemnifying party of the commencement
thereof, the indemnifying party will be entitled to participate therein and, to
the extent that it may wish, jointly with any other indemnifying party similarly
notified, to assume the defense thereof, with counsel satisfactory to such
indemnified party (who shall not, except with the consent of the indemnified
party, be counsel to the indemnifying party), and after notice from the
indemnifying party to such indemnified party of its election so to assume the
defense thereof, the indemnifying party will not be liable to such indemnified
party under this Section for any legal or other expenses subsequently incurred
by such indemnified party in connection with the defense thereof other than
reasonable costs of investigation. No indemnifying party shall, without the
prior written consent of the indemnified party, effect any settlement of any
pending or threatened action 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 (i) includes an unconditional release
of such indemnified party from all liability on any claims that are the subject
matter of such action and (ii) does not include a statement as to, or an
admission of, fault, culpability or a failure to act by or on behalf of an
indemnified party.
(d) If the indemnification provided for in this Section is unavailable
or insufficient to hold harmless an indemnified party under subsection (a) or
(b) above, then each indemnifying party shall contribute to the amount paid or
payable by such indemnified party as a result of the losses, claims, damages or
liabilities referred to in subsection (a) or (b) above (i) in such proportion as
is appropriate to reflect the relative benefits received by the Company on the
one hand and the Underwriters on the other from the offering of the Securities
or (ii) if the allocation provided by clause (i) above is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) above but also the relative fault of
the Company on the one hand and the Underwriters on the
11
other in connection with the statements or omissions which resulted in such
losses, claims, damages or liabilities as well as any other relevant equitable
considerations. The relative benefits received by the Company on the one hand
and the Underwriters on the other shall be deemed to be in the same proportion
as the total net proceeds from the offering (before deducting expenses) received
by the Company bear to the total underwriting discounts and commissions received
by the Underwriters. The relative fault shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a material
fact or the omission or alleged omission to state a material fact relates to
information supplied by the Company or the Underwriters and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such untrue statement or omission. The amount paid by an indemnified
party as a result of the losses, claims, damages or liabilities referred to in
the first sentence of this subsection (d) shall be deemed to include any legal
or other expenses reasonably incurred by such indemnified party in connection
with investigating or defending any action or claim which is the subject of this
subsection (d). Notwithstanding the provisions of this subsection (d), no
Underwriter shall not be required to contribute any amount in excess of the
amount by which the total price at which the Securities underwritten by it and
distributed to the public were offered to the public exceeds the amount of any
damages which such Underwriter has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The Underwriters' obligations in
the subsection (d) to contribute are several in proportion to their respective
underwriting obligations and not joint.
(e) The obligations of the Company under this Section shall be in
addition to any liability which the Company 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; and the obligations of the
Underwriters under this Section shall be in addition to any liability which the
respective Underwriters may otherwise have and shall extend, upon the same terms
and conditions, to each director of the Company, to each officer of the Company
who has signed the Registration Statement and to each person, if any, who
controls the Company within the meaning of the Act.
8. Default of Underwriters. If any Underwriter or Underwriters default
in their obligations to purchase Offered Securities hereunder on the Closing
Date and the aggregate principal amount of Offered Securities that such
defaulting Underwriter or Underwriters agreed but failed to purchase does not
exceed 10% of the total principal amount of Offered Securities that the
Underwriters are obligated to purchase on such Closing Date, CSFB may make
arrangements satisfactory to the Company for the purchase of such Offered
Securities by other persons, including any of the Underwriters, but if no such
arrangements are made by such Closing Date, the non-defaulting Underwriters
shall be obligated severally, in proportion to their respective commitments
hereunder, to purchase the Offered Securities that such defaulting Underwriters
agreed but failed to purchase on such Closing Date. If any Underwriter or
Underwriters so default and the aggregate principal amount of Offered Securities
with respect to which such default or defaults occur exceeds 10% of the total
principal amount of Offered Securities that the Underwriters are obligated to
purchase on such Closing Date and arrangements satisfactory to CSFB and the
Company for the purchase of such Offered Securities by other persons are not
made within 36 hours after such default, this Agreement will terminate without
liability on the part of any non-defaulting Underwriter or the Company, except
as provided in Section 9. As used in this Agreement, the term "Underwriter"
includes any person substituted for an Underwriter under this Section. Nothing
herein will relieve a defaulting Underwriter from liability for its default.
9. Survival of Certain Representations and Obligations. The respective
indemnities, agreements, representations, warranties and other statements of the
Company or its officers and of the several Underwriter set forth in or made
pursuant to this Agreement will remain in full force and effect, regardless of
any investigation, or statement as to the results thereof, made by or on behalf
of any Underwriter, the Company or any of their respective representatives,
officers or directors or any controlling person, and will survive delivery of
and payment for the Offered Securities. If for any reason the purchase of the
Offered Securities by the Underwriters is not consummated, the Company shall
remain responsible for the expenses to be paid or reimbursed by it pursuant to
Section 5 and the respective obligations of the Company and the
12
Underwriters pursuant to Section 7 shall remain in effect, and if any Offered
Securities have been purchased hereunder the representations and warranties in
Section 2 and all obligations under Section 5 shall also remain in effect. If
the purchase of the Offered Securities by the Underwriters is not consummated
for any reason other than solely because of the occurrence of any event
specified in clause (iii), (iv), (v), (vi) or (vii) of Section 6(c), the Company
will reimburse the Underwriters for all out-of-pocket expenses (including fees
and disbursements of counsel) reasonably incurred by it in connection with the
offering of the Offered Securities.
10. Notices. All communications hereunder will be in writing and, if
sent to the Underwriters, will be mailed, delivered or telegraphed and confirmed
to the Representative, c/o Credit Suisse First Boston LLC, Eleven Madison
Avenue, New York, N.Y. 10010-3629, Attention: Transactions Advisory Group, or,
if sent to the Company, will be mailed, delivered or telegraphed and confirmed
to it at 0000 Xxxxxxxxxxx Xxxx, Xxxxx 000, XxXxxx, Xxxxxxxx 00000, Attention:
Chief Financial Officer.
11. Successors. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective successors and the officers
and directors and controlling persons referred to in Section 7, and no other
person will have any right or obligation hereunder.
12. Representation of Underwriters. The Representative will act for the
several Underwriters in connection with this financing, and any action under
this Agreement taken by the Representative will be binding upon all the
Underwriters.
13. Counterparts. This Agreement may be executed 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 Agreement.
14. Applicable Law. This Agreement shall be governed by, and construed
in accordance with, the laws of the State of New York, without regard to
principles of conflicts of laws.
The Company hereby submits to the non-exclusive jurisdiction of the
Federal and state courts in the Borough of Manhattan in The City of New York in
any suit or proceeding arising out of or relating to this Agreement or the
transactions contemplated hereby.
13
If the foregoing is in accordance with the Representative's
understanding of our agreement, kindly sign and return to the Company one of the
counterparts hereof, whereupon it will become a binding agreement between the
Company and the several Underwriters in accordance with its terms.
Very truly yours,
NVR, INC.
By: /s/ Xxxx X. Xxxxxxx
-----------------------------
Name: Xxxx X. Xxxxxxx
Title: Executive Vice President &
Chief Financial Officer
The foregoing Underwriting Agreement is hereby
confirmed and accepted as of the date first above
written.
CREDIT SUISSE FIRST BOSTON LLC
By: /s/ Xxxx Xxx
------------------------
Name: Xxxx Xxx
Title: Managing Director
Acting on behalf of itself and as the
Representative of the several
Underwriters.
14
SCHEDULE A
Principal Amount of
Underwriter Offered Securities
----------- ------------------
Credit Suisse First Boston LLC ............................ $130,000,000
Banc One Capital Markets, Inc. $ 60,000,000
Comerica Securities, Inc. $ 10,000,000
------------
Total .......................... $200,000,000
============
15
