Exhibit 1
SOTHEBY'S HOLDINGS, INC.
UNDERWRITING AGREEMENT
STANDARD PROVISIONS
(DEBT SECURITIES)
, 199_
----------------
From time to time, SOTHEBY'S HOLDINGS, INC., a MICHIGAN corporation
(the "Company"), may enter into one or more underwriting agreements that provide
for the sale of designated securities to the several underwriters named therein.
The standard provisions set forth herein may be incorporated by reference in any
such underwriting agreement (an "Underwriting Agreement"). The Underwriting
Agreement, including the provisions incorporated therein by reference, is herein
sometimes referred to as this Agreement. Terms defined in the Underwriting
Agreement are used herein as therein defined.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement, including a prospectus, relating to the
Debt Securities and has filed with, or transmitted for filing to, or shall
promptly hereafter file with or transmit for filing to, the Commission a
prospectus supplement (the "Prospectus Supplement") specifically relating to the
Offered Securities pursuant to Rule 424 under the Securities Act of 1933, as
amended (the "Securities Act"). The term "Registration Statement" means the
registration statement, including the exhibits thereto, as amended to the date
of this Agreement. The term "Basic Prospectus" means the prospectus included in
the Registration Statement. The term "Prospectus" means the Basic Prospectus
together with the Prospectus Supplement. The term "preliminary prospectus" means
a preliminary prospectus supplement specifically relating to the Offered
Securities, together with the Basic Prospectus. As used herein, the terms "Basic
Prospectus," "Prospectus" and "preliminary prospectus" shall include in each
case the documents, if any, incorporated by reference therein. The terms
"supplement," "amendment" and "amend" as used herein shall include all
documents deemed to be incorporated by reference in the Prospectus that are
filed subsequent to the date of the Basic Prospectus by the Company with the
Commission pursuant to the Securities Exchange Act of 1934, as amended (the
"Exchange Act"). If the Company has filed an abbreviated registration statement
to register additional Debt Securities 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.
The term "Contract Securities" means the Offered Securities to be
purchased pursuant to the delayed delivery contracts substantially in the form
of Schedule I hereto, with such changes therein as the Company may approve (the
"Delayed Delivery Contracts"). The term "Underwriters' Securities" means the
Offered Securities other than Contract Securities. The term "Significant
Subsidiary" means each subsidiary which is a "significant subsidiary" as defined
in Rule 1-02(w) or the Commission's Regulations S-X.
1. Representations and Warranties. The Company represents and
warrants to and agrees with each of the Underwriters that:
(a) The Registration Statement has become effective; no stop
order suspending the effectiveness of the Registration Statement is in
effect, and no proceedings for such purpose are pending before or
threatened by the Commission.
(b) (i) Each document, if any, filed or to be filed pursuant
to the Exchange Act and incorporated by reference in the Prospectus
complied or will comply when so filed in all material respects with
the Exchange Act and the applicable rules and regulations of the
Commission thereunder, (ii) each part of the Registration Statement,
when such part became effective, did not contain, and each such
part, as amended or supplemented, if applicable, will not contain
any untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the
statements therein not misleading, (iii) the Registration Statement
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 (iv) the Prospectus does not contain and, as amended
or supplemented, if applicable, will not contain any untrue
statement of a material fact or omit to state a material fact
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, except
that the representations and warranties set forth in this paragraph
do not apply (A) to statements or omissions in the Registration
Statement or
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the Prospectus based upon information relating to any Underwriter
furnished to the Company in writing by such Underwriter through the
Manager expressly for use therein or (B) to that part of the
Registration Statement that constitutes the Statement of Eligibility
(Form T-1) under the Trust Indenture Act of 1939, as amended (the
"Trust Indenture Act"), of the Trustee.
(c) The Company has been duly incorporated, is validly
existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, has the corporate power and
authority to own its property and to conduct its business as
described in the Prospectus and is duly qualified to transact
business and is in good standing in each jurisdiction in which the
conduct of its business or its ownership or leasing of property
requires such qualification, except to the extent that the failure
to be so qualified or be in good standing would not have a material
adverse effect on the Company and its subsidiaries, taken as a whole.
(d) Each Significant Subsidiary of the Company has been duly
incorporated, is validly existing as a corporation in good standing
under the laws of the jurisdiction of its incorporation, has the
corporate power and authority to own its property and to conduct its
business as described in the Prospectus and is duly qualified to
transact business and is in good standing in each jurisdiction in
which the conduct of its business or its ownership or leasing of
property requires such qualification, except to the extent that the
failure to be so qualified or be in good standing would not have a
material adverse effect on the Company and its Significant
Subsidiaries, taken as a whole; all of the issued shares of capital
stock of each Significant Subsidiary of the Company have been duly
and validly authorized and issued, are fully paid and non-assessable
and are owned directly by the Company, free and clear of all liens,
encumbrances, equities or claims.
(e) This Agreement has been duly authorized, executed and
delivered by the Company.
(f) The Indenture has been duly qualified under the Trust
Indenture Act and has been duly authorized, executed and delivered
by the Company and is a valid and binding agreement of the Company,
enforceable in accordance with its terms, subject to applicable
bankruptcy, insolvency or similar laws affecting creditors' rights
generally and general principles of equity.
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(g) The Delayed Delivery Contracts have been duly authorized,
executed and delivered by the Company and are valid and binding
agreements of the Company, enforceable in accordance with their
respective terms, subject to applicable bankruptcy, insolvency or
similar laws affecting creditors' rights generally and general
principles of equity.
(h) The Offered Securities have been duly authorized and,
when executed and authenticated in accordance with the provisions of
the Indenture and delivered to and paid for by the Underwriters in
accordance with the terms of the Underwriting Agreement, in the case
of the Underwriters' Securities, or by institutional investors in
accordance with the terms of the Delayed Delivery Contracts, in the
case of the Contract Securities and will be entitled to the benefits
of the Indenture, and will be valid and binding obligations of the
Company, in each case enforceable in accordance with their
respective terms, subject to applicable bankruptcy, insolvency or
similar laws affecting creditors' rights generally and general
principles of equity.
(i) The execution and delivery by the Company of, and the
performance by the Company of its obligations under, this Agreement,
the Indenture, the Offered Securities and the Delayed Delivery
Contracts will not contravene any provision of applicable law or the
certificate of incorporation or by-laws of the Company or any
agreement or other instrument binding upon the Company or any of its
subsidiaries that is material to the Company and its subsidiaries,
taken as a whole, or any judgment, order or decree of any
governmental body, agency or court having jurisdiction over the
Company or any subsidiary, and no consent, approval, authorization
or order of, or qualification with, any governmental body or agency
is required for the performance by the Company of its obligations
under this Agreement, the Indenture, the Offered Securities or the
Delayed Delivery Contracts, except such as may be required by the
securities or Blue Sky laws of the various states in connection with
the offer and sale of the Offered Securities.
(j) There has not occurred any material adverse change, or
any development involving a prospective material adverse change, in
the condition, financial or otherwise, or in the earnings, business
or operations of the Company and its subsidiaries, taken as a whole,
from that set forth in the Prospectus (exclusive of any amendments
or supplements thereto subsequent to the date of this Agreement).
(k) There are no legal or governmental proceedings pending or
threatened to which the Company or any of its subsidiaries is a
party or to
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which any of the properties of the Company or any of its subsidiaries
is subject that are required to be described in the Registration
Statement or the Prospectus and are not so described or any statutes,
regulations, contracts or other documents that are required to be
described in the Registration Statement or the Prospectus or to be
filed or incorporated by reference as exhibits to the Registration
Statement that are not described, filed or incorporated as required.
(l) Each preliminary prospectus filed as part of the
registration statement as originally filed or as part of any
amendment thereto, or filed pursuant to Rule 424 under the
Securities Act, complied when so filed in all material respects with
the Securities Act and the applicable rules and regulations of the
Commission thereunder.
(m) 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 such term is defined in the Investment
Company Act of 1940, as amended.
2. Delayed Delivery Contracts. If the Prospectus provides for sales
of Offered Securities pursuant to Delayed Delivery Contracts, the Company hereby
authorizes the Underwriters to solicit offers to purchase Contract Securities on
the terms and subject to the conditions set forth in the Prospectus pursuant to
Delayed Delivery Contracts. Delayed Delivery Contracts may be entered into only
with institutional investors approved by the Company of the types set forth in
the Prospectus. On the Closing Date, the Company will pay to the Manager as
compensation for the accounts of the Underwriters the commission set forth in
the Underwriting Agreement in respect of the Contract Securities. The
Underwriters will not have any responsibility in respect of the validity or the
performance of any Delayed Delivery Contracts.
If the Company executes and delivers Delayed Delivery Contracts with
institutional investors, the aggregate amount of Offered Securities to be
purchased by the several Underwriters shall be reduced by the aggregate amount
of Contract Securities; such reduction shall be applied to the commitment of
each Underwriter pro rata in proportion to the amount of Offered Securities set
forth opposite such Underwriter's name in the Underwriting Agreement, except to
the extent that the Manager determines that such reduction shall be applied in
other proportions and so advises the Company; provided, however, that the total
amount of Offered Securities to be purchased by all Underwriters shall be the
aggregate amount set forth above, less the aggregate amount of Contract
Securities.
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3. Terms of Public Offering. The Company is advised by the Manager
that the Underwriters propose to make a public offering of their respective
portions of the Underwriters' Securities as soon after this Agreement has been
entered into as in the Manager's judgment is advisable. The terms of the public
offering of the Underwriters' Securities are set forth in the Prospectus.
4. Payment and Delivery. Payment for the Underwriters' Securities
shall be made to the Company in Federal or other funds immediately available in
New York City at the time and place set forth in the Underwriting Agreement,
upon delivery to the Manager for the respective accounts of the several
Underwriters of the Underwriters' Securities registered in such names and in
such denominations as the Manager shall request in writing not less than one
full business day prior to the date of delivery, with any transfer taxes payable
in connection with the transfer of the Underwriters' Securities to the
Underwriters duly paid.
5. Conditions to the Underwriters' Obligations. The several
obligations of the Underwriters are subject to the following conditions:
(a) Subsequent to the execution and delivery of the
Underwriting Agreement and prior to the Closing Date:
(i) there shall not have occurred any downgrading, nor
shall any notice have been given of any intended or potential
downgrading or of any review for a possible change that does
not indicate the direction of the possible change, in the
rating accorded the Company or any of the 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 or
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 the judgment of the Manager, is
material and adverse and that makes it, in the judgment of the
Manager, impracticable to market the Offered Securities on the
terms and in the manner contemplated in the Prospectus.
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(b) The Underwriters shall have received on the Closing Date
a certificate, dated the Closing Date and signed by an executive
officer of the Company, to the effect set forth in Section 5(a)(i)
and to the effect that the representations and warranties of the
Company contained in this Agreement are true and correct as of the
Closing Date and that the Company has complied with all of the
agreements and satisfied all of the conditions on its part to be
performed or satisfied hereunder on or before the Closing Date.
The officer signing and delivering such certificate may rely
upon the best of his or her knowledge as to proceedings threatened.
(c) The Underwriters shall have received on the Closing Date
an opinion of Xxxx Xxxxxx & Xxxxxx, outside counsel for the Company,
dated the Closing Date, to the effect that:
(i) the Company has been duly incorporated, is validly
existing as a corporation in good standing under the laws of
the jurisdiction of its incorporation, has the corporate power
and authority to own its property and to conduct its business
as described in the Prospectus and is duly qualified to
transact business and is in good standing in each jurisdiction
in which the conduct of its business or its ownership or
leasing of property requires such qualification, except to the
extent that the failure to be so qualified or be in good
standing would not have a material adverse effect on the
Company and its subsidiaries, taken as a whole;
(ii) each Significant Subsidiary of the Company formed in
the United States has been duly incorporated, is validly
existing as a corporation in good standing under the laws of
the jurisdiction of its incorporation, has the corporate power
and authority to own its property and to conduct \its business
as described in the Prospectus and is duly qualified to
transact business and is in good standing in each jurisdiction
in which the conduct of its business or its ownership or
leasing of property requires such qualification, except to the
extent that the failure to be so qualified or be in good
standing would not have a material adverse effect on the
Company and its subsidiaries, taken as a whole;
(iii) this Agreement has been duly authorized, executed and
delivered by the Company;
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(iv) the Indenture has been duly qualified under the Trust
Indenture Act and has been duly authorized, executed and
delivered by the Company and is a valid and binding agreement
of the Company, enforceable in accordance with its terms,
subject to applicable bankruptcy, insolvency or similar laws
affecting creditors' rights generally and general principles
of equity;
(v) the Delayed Delivery Contracts have been duly
authorized, executed and delivered by the Company and are
valid and binding agreements of the Company, enforceable in
accordance with their respective terms, subject to applicable
bankruptcy, insolvency or similar laws affecting creditors'
rights generally and general principles of equity;
(vi) the Offered Securities have been duly authorized and,
when executed and authenticated in accordance with the
provisions of the Indenture and delivered to and paid for by
the Underwriters in accordance with the terms of the
Underwriting Agreement, in the case of Underwriters'
Securities, or by institutional investors in accordance with
the terms of the Delayed Delivery Contracts, in the case of
the Contract Securities, will be entitled to the benefits of
the Indenture and will be valid and binding obligations of the
Company, in each case enforceable in accordance with their
respective terms, subject to applicable bankruptcy, insolvency
or similar laws affecting creditors' rights generally and
general principles of equity;
(vii) the execution and delivery by the Company of, and the
performance by the Company of its obligations under, this
Agreement, the Indenture, the Offered Securities and the
Delayed Delivery Contracts will not contravene any provision
of applicable law or the certificate of incorporation or
by-laws of the Company or, to the best of such counsel's
knowledge, any agreement or other instrument binding upon the
Company or any of its subsidiaries that is material to the
Company and its subsidiaries, taken as a whole, or, to the
best of such counsel's knowledge, any judgment, order or
decree of any governmental body, agency or court having
jurisdiction over the Company or any subsidiary, and no
consent, approval, authorization or order of, or qualification
with, any governmental body or agency is required for the
performance by the Company of its obligations under this
Agreement, the Indenture, the Offered Securities or the
Delayed Delivery Contracts, except such as may be required by
the securities or Blue
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Sky laws of the various states in connection with the offer
and sale of the Offered Securities;
(viii) the statements (A) in the Prospectus under the
captions "Description of the Debt Securities" and "Plan of
Distribution," (B) in the Registration Statement under Item
15, (C) in "Item 3 - Legal Proceedings" of the Company's most
recent annual report on Form 10-K incorporated by reference in
the Prospectus and (D) in "Item 1 - Legal Proceedings" of Part
II of the Company's quarterly reports on Form 10-Q, if any,
filed since such annual report, in each case insofar as such
statements constitute summaries of the legal matters,
documents or proceedings referred to therein, fairly present
the information called for with respect to such legal matters,
documents and proceedings and fairly summarize the matters
referred to therein;
(ix) after due inquiry, such counsel does not know of any
legal or governmental proceedings pending or threatened to
which the Company or any of its subsidiaries is a party or to
which any of the properties of the Company or any of its
subsidiaries is subject that are required to be described in
the Registration Statement or the Prospectus and are not so
described or of any statutes, regulations, contracts or other
documents that are required to be described in the
Registration Statement or the Prospectus or to be filed or
incorporated by reference as exhibits to the Registration
Statement that are not described, filed or incorporated as
required;
(x) the Company is not and, after giving effect to the
offering and sale of the Offered Securities and the
application of proceeds thereof as described in the
Prospectus, will not be an "investment company" as such term
is defined in the Investment Company Act of 1940, as amended;
(xi) such counsel is of the opinion ascribed to it in the
Prospectus under the caption "Taxation";
(xii) such counsel (A) is of the opinion that each
document, if any, filed pursuant to the Exchange Act and
incorporated by reference in the Prospectus (except for
financial statements and schedules and other financial and
statistical data included therein as to which such counsel
need not express any opinion) complied when so filed as to
form in all material respects with the Exchange Act and the
applicable rules and regulations of
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the Commission thereunder, (B) has no reason to believe that
(except for financial statements and schedules and other
financial and statistical data as to which such counsel need
not express any belief and except for that part of the
Registration Statement that constitutes the Form T-1
heretofore referred to) each part of the Registration
Statement, when such part became effective, contained and, as
of the date such opinion is delivered, contains any untrue
statement of a material fact or omitted or omits to state a
material fact required to be stated therein or necessary to
make the statements therein not misleading, (C) is of the
opinion that the Registration Statement and Prospectus (except
for financial statements and schedules and other financial and
statistical data included therein as to which such counsel
need not express any opinion) comply as to form in all
material respects with the Securities Act and the applicable
rules and regulations of the Commission thereunder and (D) has
no reason to believe that (except for financial statements and
schedules and other financial and statistical data as to which
such counsel need not express any belief) the Prospectus as of
the date such opinion is delivered contains any untrue
statement of a material fact 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.
(d) The Underwriters shall have received on the Closing Date
an opinion of Xxxxx Xxxx & Xxxxxxxx, special counsel for the
Underwriters, dated the Closing Date, covering the matters referred
to in Sections 5(c)(iii), 5(c)(iv), 5(c)(v), 5(c)(vi) and 5(c)(viii)
(but only as to the statements in the Prospectus under "Description
of the Debt Securities" and "Plan of Distribution") and clauses
5(c)(xii)(B), 5(c)(xii)(C) and 5(c)(xii)(D) above.
With respect to Section 5(c)(xii) above, Xxxx Xxxxxx & Xxxxxx
may state that their opinion and belief are based upon their
participation in the preparation of the Registration Statement and
Prospectus and any amendments or supplements thereto and documents
incorporated therein by reference and review and discussion of the
contents thereof, but are without independent check or verification,
except as specified. With respect to clauses 5(c)(xii)(B), 5(c)(xii)(C)
and 5(c)(xii)(D) above, Xxxxx Xxxx & Xxxxxxxx may state that their
opinion and belief are based upon their participation in the
preparation of the Registration Statement and Prospectus and any
amendments or supplements thereto (but not including documents
incorporated therein by reference) and review and discussion of
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the contents thereof (including documents incorporated therein by
reference), but are without independent check or verification, except
as specified.
The opinion of Xxxx Xxxxxx & Xxxxxx described in Section 5(c)
above shall be rendered to the Underwriters at the request of the
Company and shall so state therein.
(e) The Underwriters shall have received on the Closing
Date a letter, dated the Closing Date, in form and substance
satisfactory to the Underwriters, from the Company's independent
public accountants, containing statements and information of the
type ordinarily included in accountants' "comfort letters" to
underwriters with respect to the financial statements and certain
financial information contained in or incorporated by reference into
the Prospectus; provided that such letter shall use a "cut-off date"
not earlier than the date of the Underwriting Agreement.
6. Covenants of the Company. In further consideration of the
agreements of the Underwriters herein contained, the Company covenants with each
Underwriter as follows:
(a) To furnish the Manager, without charge, three signed
copies of the Registration Statement (including exhibits thereto)
and for delivery to each other Underwriter a conformed copy of the
Registration Statement (without exhibits thereto) and to furnish to
the Manager in New York City, without charge, prior to 10:00 AM New
York City time on the business day next succeeding the date of this
Agreement and during the period mentioned in Section 6(c) below, as
many copies of the Prospectus, any documents incorporated by
reference therein and any supplements and amendments thereto or to
the Registration Statement as the Manager may reasonably request.
(b) Before amending or supplementing the Registration
Statement or the Prospectus with respect to the Offered Securities
during the period mentioned in Section 6(c) below, to furnish to the
Manager a copy of each such proposed amendment or supplement and not
to file any such proposed amendment or supplement to which the
Manager reasonably objects, and to file with the Commission within
the applicable period specified in Rule 424(b) under the Securities
Act any prospectus required to be filed pursuant to such Rule.
(c) If, during such period after the first date of the
public offering of the Offered Securities as in the opinion of
counsel for the Underwriters
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the Prospectus is required by law to be delivered in connection with
sales by an Underwriter or dealer, any event shall occur or condition
exist as a result of which it is necessary to amend or supplement the
Prospectus in order to make the statements therein, in the light of the
circumstances when the Prospectus is delivered to a purchaser, not
misleading, or if, in the opinion of counsel for the Underwriters, it
is necessary to amend or supplement the Prospectus to comply with
applicable law, forthwith to prepare, file with the Commission and
furnish, at its own expense, to the Underwriters and to the dealers
(whose names and addresses the Manager will furnish to the Company) to
which Offered Securities may have been sold by the Manager on behalf of
the Underwriters and to any other dealers upon request, either
amendments or supplements to the Prospectus so that the statements in
the Prospectus as so amended or supplemented will not, in the light of
the circumstances when the Prospectus is delivered to a purchaser, be
misleading or so that the Prospectus, as amended or supplemented, will
comply with law.
(d) To endeavor to qualify the Offered Securities for offer
and sale under the securities or Blue Sky laws of such jurisdictions
as the Manager shall reasonably request and to maintain such
qualification for as long as the Manager shall reasonably request.
(e) To make generally available to the Company's security
holders and to the Manager as soon as practicable an earning
statement covering a twelve month period beginning on the first day
of the first full fiscal quarter after the date of this Agreement,
which earning statement shall satisfy the provisions of Section
11(a) of the Securities Act and the rules and regulations of the
Commission thereunder. If such fiscal quarter is the first fiscal
quarter of the Company's fiscal year, such earning statement shall
be made available not later than 90 days after the close of the
period covered thereby and in all other cases shall be made
available not later than 45 days after the close of the period
covered thereby.
(f) During the period beginning on the date of the
Underwriting Agreement and continuing to and including the Closing
Date, not to offer, sell, contract to sell or otherwise dispose of
any debt securities of the Company or warrants to purchase or
otherwise acquire debt securities of the Company substantially
similar to the Offered Securities (other than (i) the Offered
Securities and (ii) commercial paper issued in the ordinary course
of business), without the prior written consent of the Manager.
(g) Whether or not the transactions contemplated in this
Agreement are consummated or this Agreement is terminated, to pay or
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cause to be paid all expenses incident to the performance of its
obligations under this Agreement, including: (i) the fees,
disbursements and expenses of the Company's counsel and the Company's
accountants in connection with the registration and delivery of the
Offered Securities under the Securities Act and all other fees or
expenses in connection with the preparation and filing of the
Registration Statement, any preliminary prospectus, the Prospectus and
amendments and supplements to any of the foregoing, including all
printing costs associated therewith, and the mailing and delivering of
copies thereof to the Underwriters and dealers, in the quantities
hereinabove specified, (ii) all costs and expenses related to the
transfer and delivery of the Offered Securities to the Underwriters,
including any transfer or other taxes payable thereon, (iii) the cost
of printing or producing any Blue Sky or legal investment memorandum in
connection with the offer and sale of the Offered Securities under
state law and all expenses in connection with the qualification of the
Offered Securities for offer and sale under state law as provided in
Section 6(d) hereof, including filing fees and the reasonable fees and
disbursements of counsel for the Underwriters in connection with such
qualification and in connection with the Blue Sky or legal investment
memorandum, (iv) all filing fees and the reasonable fees and
disbursements of counsel to the Underwriters incurred in connection
with the review and qualification of the offering of the Offered
Securities by the National Association of Securities Dealers, Inc., (v)
any fees charged by the rating agencies for the rating of the Offered
Securities, (vi) if applicable, all fees and expenses in connection
with the preparation and filing of the registration statement on Form
8-A relating to the Offered Securities and all costs and expenses
incident to listing the Offered Securities on any national securities
exchanges and foreign stock exchanges, (vii) the cost of printing
certificates representing the Offered Securities, (viii) the costs and
charges of any trustee, transfer agent, registrar or depositary and
(ix) all other costs and expenses incident to the performance of the
obligations of the Company hereunder for which provision is not
otherwise made in this Section. It is understood, however, that except
as provided in this Section, Section 7 entitled "Indemnification and
Contribution", and the last paragraph of Section 9 below, the
Underwriters will pay all of their costs and expenses, including fees
and disbursements of their counsel, transfer taxes payable on resale of
any of the Securities by them and any advertising expenses connected
with any offers they may make.
7. Indemnification and Contribution. (a) The Company agrees to
indemnify and hold harmless each Underwriter and each person, if any, who
controls any Underwriter within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act from and against any and all
losses,
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claims, damages and liabilities (including, without limitation, any legal or
other expenses reasonably incurred in connection with defending or investigating
any such action or claim) caused by any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement or any
amendment thereof, any preliminary prospectus or the Prospectus (as amended or
supplemented if the Company shall have furnished any amendments or supplements
thereto), or caused by any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, except insofar as such losses, claims, damages or
liabilities are caused by any such untrue statement or omission or alleged
untrue statement or omission based upon information relating to any Underwriter
furnished to the Company in writing by such Underwriter through the Manager
expressly for use therein.
(b) Each Underwriter agrees, severally and not jointly, to indemnify
and hold harmless the Company, its directors, its officers who sign the
Registration Statement and each person, if any, who controls the Company within
the meaning of either Section 15 of the Securities Act or Section 20 of the
Exchange Act to the same extent as the foregoing indemnity from the Company to
such Underwriter, but only with reference to information relating to such
Underwriter furnished to the Company in writing by such Underwriter through the
Manager expressly for use in the Registration Statement, any preliminary
prospectus, the Prospectus or any amendments or supplements thereto.
(c) In case any proceeding (including any governmental investigation)
shall be instituted involving any person in respect of which indemnity may be
sought pursuant to either Section 7(a) or 7(b), such person (the "indemnified
party") shall promptly notify the person against whom such indemnity may be
sought (the "indemnifying party") in writing and the indemnifying party, upon
request of the indemnified party, shall retain counsel reasonably satisfactory
to the indemnified party to represent the indemnified party and any others the
indemnifying party may designate in such proceeding and shall pay the fees and
disbursements of such counsel related to such proceeding. In any such
proceeding, any indemnified party shall have the right to retain its own
counsel, but the fees and expenses of such counsel shall be at the expense of
such indemnified party unless (i) the indemnifying party and the indemnified
party shall have mutually agreed to the retention of such counsel or (ii) the
named parties to any such proceeding (including any impleaded parties) include
both the indemnifying party and the indemnified party and representation of both
parties by the same counsel would be inappropriate due to actual or potential
differing interests between them. It is understood that the indemnifying party
shall not, in respect of the legal expenses of any indemnified party in
connection with any proceeding or related proceedings in the same jurisdiction,
be liable for the fees and expenses of more
14
than one separate firm (in addition to any local counsel) for all such
indemnified parties and that all such fees and expenses shall be reimbursed as
they are incurred. Such firm shall be designated in writing by the Manager, in
the case of parties indemnified pursuant to Section 7(a) above, and by the
Company, in the case of parties indemnified pursuant to Section 7(b) above. The
indemnifying party shall not be liable for any settlement of any proceeding
effected without its written consent, but if settled with such consent or if
there be a final judgment for the plaintiff, the indemnifying party agrees to
indemnify the indemnified party from and against any loss or liability by reason
of such settlement or judgment. Notwithstanding the foregoing sentence, if at
any time an indemnified party shall have requested an indemnifying party to
reimburse the indemnified party for fees and expenses of counsel as contemplated
by the second and third sentences of this paragraph, the indemnifying party
agrees that it shall be liable for any settlement of any proceeding effected
without its written consent if (i) such settlement is entered into more than 30
days after receipt by such indemnifying party of the aforesaid request and (ii)
such indemnifying party shall not have reimbursed the indemnified party in
accordance with such request prior to the date of such settlement. No
indemnifying party shall, without the prior written consent of the indemnified
party, effect any settlement of any pending or threatened proceeding in respect
of which any indemnified party is or could have been a party and indemnity could
have been sought hereunder by such indemnified party, unless such settlement
includes an unconditional release of such indemnified party from all liability
on claims that are the subject matter of such proceeding.
(d) To the extent the indemnification provided for in Section 7(a) or
7(b) is unavailable to an indemnified party or insufficient in respect of any
losses, claims, damages or liabilities referred to therein, then each
indemnifying party under such paragraph, in lieu of indemnifying such
indemnified party thereunder, shall contribute to the amount paid or payable by
such indemnified party as a result of such losses, claims, damages or
liabilities (i) in such proportion as is appropriate to reflect the relative
benefits received by the Company on the one hand and the Underwriters on the
other hand from the offering of the Offered Securities or (ii) if the allocation
provided by clause 7(d)(i) above is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits referred
to in clause 7(d)(i) above but also the relative fault of the Company on the one
hand and of the Underwriters on the other hand in connection with the statements
or omissions that resulted in such losses, claims, damages or liabilities, as
well as any other relevant equitable considerations. The relative benefits
received by the Company on the one hand and the Underwriters on the other hand
in connection with the offering of the Offered Securities shall be deemed to be
in the same respective proportions as the net proceeds from the offering of such
Offered Securities (before deducting expenses) received by the Company and the
total underwriting discounts and commissions received by the
15
Underwriters, in each case as set forth in the table on the cover of the
Prospectus Supplement, bear to the aggregate public offering price of the
Offered Securities. The relative fault of the Company on the one hand and the
Underwriters on the other hand shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company or by the Underwriters and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The Underwriters' respective obligations to contribute
pursuant to this Section 7 are several in proportion to the respective principal
amounts of Offered Securities they have purchased hereunder, and not joint.
(e) The Company and the Underwriters agree that it would not be just
or equitable if contribution pursuant to this Section 7 were determined by pro
rata allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation that does not take account of the
equitable considerations referred to in Section 7(d). The amount paid or payable
by an indemnified party as a result of the losses, claims, damages and
liabilities referred to in the immediately preceding paragraph shall be deemed
to include, subject to the limitations set forth above, any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this Section 7, no Underwriter shall be required to contribute any
amount in excess of the amount by which the total price at which the Offered
Securities underwritten by it and distributed to the public were offered to the
public exceeds the amount of any damages that such Underwriter has otherwise
been required to pay by reason of such untrue or alleged untrue statement or
omission or alleged omission. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The remedies provided for in this Section 7 are not exclusive
and shall not limit any rights or remedies which may otherwise be available to
any indemnified party at law or in equity.
(f) The indemnity and contribution provisions contained in this
Section 7 and the representations, warranties and other statements of the
Company contained in this Agreement shall remain operative and in full force and
effect regardless of (i) any termination of this Agreement, (ii) any
investigation made by or on behalf of any Underwriter or any person controlling
any Underwriter or the Company, its officers or directors or any person
controlling the Company and (iii) acceptance of and payment for any of the
Offered Securities.
8. Termination. This Agreement shall be subject to termination by
notice given by the Manager to the Company, if (a) after the execution and
16
delivery of the Underwriting Agreement and prior to the Closing Date (i) trading
generally shall have been suspended or materially limited on or by, as the case
may be, any of the New York Stock Exchange, the American Stock Exchange, the
National Association of Securities Dealers, Inc., the Chicago Board of Options
Exchange, the Chicago Mercantile Exchange or the Chicago Board of Trade, (ii)
trading of any securities of the Company shall have been suspended on any
exchange or in any over-the-counter market, (iii) a general moratorium on
commercial banking activities in New York shall have been declared by either
Federal or New York State authorities or (iv) there shall have occurred any
outbreak or escalation of hostilities or any change in financial markets or any
calamity or crisis that, in the judgment of the Manager, is material and adverse
and (b) in the case of any of the events specified in clauses 8(a)(i) through
8(a)(iv), such event, singly or together with any other such event, makes it, in
the judgment of the Manager, impracticable to market the Offered Securities on
the terms and in the manner contemplated in the Prospectus.
9. Defaulting Underwriters. If, on the Closing Date, any one or more
of the Underwriters shall fail or refuse to purchase Underwriters' Securities
that it has or they have agreed to purchase hereunder on such date, and the
aggregate principal amount of Underwriters' Securities which such defaulting
Underwriter or Underwriters agreed but failed or refused to purchase is not more
than one-tenth of the aggregate principal amount of the Underwriters' Securities
to be purchased on such date, the other Underwriters shall be obligated
severally in the proportions that the principal amount of Underwriters'
Securities set forth opposite their respective names in the Underwriting
Agreement bears to the aggregate principal amount of Underwriters' Securities
set forth opposite the names of all such non-defaulting Underwriters, or in such
other proportions as the Manager may specify, to purchase the Underwriters'
Securities which such defaulting Underwriter or Underwriters agreed but failed
or refused to purchase on such date; provided that in no event shall the
principal amount of Underwriters' Securities that any Underwriter has agreed to
purchase pursuant to this Agreement be increased pursuant to this Section 9 by
an amount in excess of one-ninth of such principal amount of Underwriters'
Securities without the written consent of such Underwriter. If, on the Closing
Date, any Underwriter or Underwriters shall fail or refuse to purchase
Underwriters' Securities and the aggregate principal amount of Underwriters'
Securities with respect to which such default occurs is more than one-tenth of
the aggregate principal amount of Underwriters' Securities to be purchased on
such date, and arrangements satisfactory to the Manager and the Company for the
purchase of such Underwriters' Securities are not made within 36 hours after
such default, this Agreement shall terminate without liability on the part of
any non-defaulting Underwriter or the Company. In any such case either the
Manager or the Company shall have the right to postpone the Closing Date, but in
no event for
17
longer than seven days, in order that the required changes, if any, in the
Registration Statement and in the Prospectus or in any other documents or
arrangements may be effected. Any action taken under this paragraph shall not
relieve any defaulting Underwriter from liability in respect of any default of
such Underwriter under this Agreement.
If this Agreement shall be terminated by the Underwriters, or any of
them, because of any failure or refusal on the part of the Company to comply
with the terms or to fulfill any of the conditions of this Agreement, or if for
any reason the Company shall be unable to perform its obligations under this
Agreement, the Company will reimburse the Underwriters or such Underwriters as
have so terminated this Agreement with respect to themselves, severally, for all
out-of-pocket expenses (including the fees and disbursements of their counsel)
reasonably incurred by such Underwriters in connection with this Agreement or
the offering contemplated hereunder.
10. Counterparts. This Agreement may be signed in two or more
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.
11. Applicable Law. This Agreement shall be governed by and construed
in accordance with the internal laws of the State of New York.
12. Headings. The headings of the sections of this Agreement have been
inserted for convenience of reference only and shall not be deemed a part of
this Agreement.
18
UNDERWRITING AGREEMENT
, 199_
-----------
SOTHEBY'S HOLDINGS, INC.
000 Xxxxx Xxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxxx Xxxxx, Xxxxxxxx 00000
Dear Sirs and Mesdames:
We (the "Manager") are acting on behalf of the underwriter or
underwriters (including ourselves) named below (such underwriter or underwriters
being herein called the "Underwriters"), and we understand that SOTHEBY'S
HOLDINGS, INC., a MICHIGAN corporation (the "Company"), proposes to issue and
sell [Currency and Principal Amount] aggregate initial offering price of [Full
title of Debt Securities] (the "Debt Securities"). (The Debt Securities are also
referred to herein as the "Offered Securities.") The Debt Securities will be
issued pursuant to the provisions of an Indenture dated as of _______________,
199_ (the "Indenture") between the Company and THE CHASE MANHATTAN BANK, as
Trustee (the "Trustee").
Subject to the terms and conditions set forth or incorporated by
reference herein, the Company hereby agrees to sell to the several Underwriters,
and each Underwriter agrees, severally and not jointly, to purchase from the
Company the respective principal amounts of Debt Securities set forth below
opposite their names at a purchase price of ____% of the principal amount of
Debt Securities [, plus accrued interest, if any, from [Date of Offered
Securities] to the date of payment and delivery]1:
Principal Amount of
Name Debt Securities
------------------------------------------- --------------------
Xxxxxx Xxxxxxx & Co. Incorporated
Xxxxxx Xxxxxxx & Co. International Limited
[Insert syndicate list]
--------------------
Total..................................
---------------------
(1) To be added only if the transaction does not close "flat" (i.e.,
when the purchaser pays accrued interest on the debt security at closing).
Unless otherwise provided in the Debt Securities, accrued interest, if any,
will be computed on the basis of a 360-day year of twelve 30-day months.
[The principal amount of Debt Securities to be purchased by the several
Underwriters shall be reduced by the aggregate principal amount of Debt
Securities sold pursuant to delayed delivery contracts.](2)
The Underwriters will pay for the Offered Securities [(less any Offered
Securities sold pursuant to delayed delivery contracts)] upon delivery thereof
at [office] at ______ a.m. (New York City time) on ___________, 199_, or at such
other time, not later than 5:00 p.m. (New York City time) on __________, 199_,
as shall be designated by the Manager. The time and date of such payment and
delivery are hereinafter referred to as the Closing Date.
The Offered Securities shall have the terms set forth in the Prospectus
dated ___________, 199_, and the Prospectus Supplement dated ____________, 199_,
including the following:
Terms of Debt Securities
Maturity Date: ,
----------------- ------
Interest Rate: ,
----------------- ------
Redemption Provisions: ,
----------------- ------
Interest Payment Dates: and
----------------- ------
commencing
-------------
,
--- ------
[(Interest accrues from: ,)](3)
-----------------
Form and Denomination:
-----------------
[Other Terms:]
-------------
,
----------------- ------
,
----------------- ------
,
----------------- ------
-----------------
-----------------
------------------
(2) To be added only if delayed delivery contracts are contemplated.
(3) To be added only if the transaction does not close flat.
2
-------------
[Other Terms:]
,
----------------- ------
-------------
-------------
,
----------------- ------
-----------------
[Other Terms]:
[The commission to be paid to the Underwriters in respect of the
Offered Securities purchased pursuant to delayed delivery contracts arranged by
the Underwriters shall be ___% of the principal amount of the Debt Securities so
purchased.](4)
All provisions contained in the document entitled SOTHEBY'S HOLDINGS,
INC. Underwriting Agreement Standard Provisions (Debt Securities) dated _______,
199_, a copy of which is attached hereto, are herein incorporated by reference
in their entirety and shall be deemed to be a part of this Agreement to the same
extent as if such provisions had been set forth in full herein, except that (i)
if any term defined in such document is otherwise defined herein, the definition
set forth herein shall control, (ii) all references in such document to a type
of security that is not an Offered Security shall not be deemed to be a part of
this Agreement, (iii) if the Offered Securities do not include Debt Warrants,
then all references in such document to Debt Warrant Securities shall not be
deemed to be a part of this Agreement and (iv) all references in such document
to a type of agreement that has not been entered into in connection with the
transactions contemplated hereby shall not be deemed to be a part of this
Agreement.
---------
(4) To be added only if delayed delivery contracts are contemplated.
3
[SIGNATURE PAGE WHERE
XXXXXX XXXXXXX & CO. INCORPORATED
OR XXXXXX XXXXXXX & CO. INTERNATIONAL LIMITED
IS A CO-LEAD MANAGER]
Please confirm your agreement by having an authorized officer sign a
copy of this Agreement in the space set forth below.
Very truly yours,
[XXXXXX XXXXXXX & CO.
INCORPORATED]
[XXXXXX XXXXXXX & CO.
INTERNATIONAL LIMITED]
[Name of Other Lead Managers]
Acting severally on behalf of themselves and the
several Underwriters named herein
By: [XXXXXX XXXXXXX & CO.
INCORPORATED]
[XXXXXX XXXXXXX & CO.
INTERNATIONAL LIMITED]
By:
----------------------------
Name:
Title:
Accepted:
SOTHEBY'S HOLDINGS, INC.
By:
------------------------------
Name:
Title:
4
[SIGNATURE PAGE WHERE
XXXXXX XXXXXXX & CO. INCORPORATED
OR XXXXXX XXXXXXX & CO. INTERNATIONAL LIMITED
IS SOLE MANAGER]
Please confirm your agreement by having an authorized officer sign a
copy of this Agreement in the space set forth below.
Very truly yours,
[XXXXXX XXXXXXX & CO.
INCORPORATED]
[XXXXXX XXXXXXX & CO.
INTERNATIONAL LIMITED]
[Name of Other Lead Managers]
Acting severally on behalf of itself and the several
Underwriters named herein
By:
---------------------------
Name:
Title:
Accepted:
SOTHEBY'S HOLDINGS, INC.
By:
-------------------------------
Name:
Title:
5
SCHEDULE I
DELAYED DELIVERY CONTRACT
, 199
-------- -
Dear Sirs and Mesdames:
The undersigned hereby agrees to purchase from SOTHEBY'S HOLDINGS, INC,
a MICHIGAN corporation (the "Company"), and the Company agrees to sell to the
undersigned the Company's securities described in Schedule A annexed hereto (the
"Securities"), offered by the Company's Prospectus dated __________________,
19__ and Prospectus Supplement dated ________________, 19__, receipt of copies
of which are hereby acknowledged, at a purchase price stated in Schedule A and
on the further terms and conditions set forth in this Agreement. The undersigned
does not contemplate selling Securities prior to making payment therefor.
The undersigned will purchase from the Company Securities in the
principal amount and numbers on the delivery dates set forth in Schedule A. Each
such date on which Securities are to be purchased hereunder is hereinafter
referred to as a "Delivery Date."
Payment for the Securities which the undersigned has agreed to purchase
on each Delivery Date shall be made to the Company in Federal or other funds
immediately available in New York City, at 10:00 a.m. (New York City time) on
the Delivery Date, upon delivery to the undersigned of the Securities to be
purchased by the undersigned on the Delivery Date, in such denominations and
registered in such names as the undersigned may designate by written or
telegraphic communication addressed to the Company not less than five full
business days prior to the Delivery Date.
The obligation of the undersigned to take delivery of and make payment
for the Securities on the Delivery Date shall be subject to the conditions that
(1) the purchase of Securities to be made by the undersigned shall not at the
time of delivery be prohibited under the laws of the jurisdiction to which the
undersigned is subject and (2) the Company shall have sold, and delivery shall
have taken place to the underwriters (the "Underwriters") named in the
Prospectus Supplement referred to above of, such part of the Securities as is to
be sold to them. Promptly after completion of sale and delivery to the
Underwriters, the Company will mail or deliver to the undersigned as its address
set forth below notice to such effect, accompanied by a copy of the opinion of
counsel for the Company delivered to the Underwriters in connection therewith.
Failure to take delivery of and make payment for Securities by any
purchaser under any other Delayed Delivery Contract shall not relieve the
undersigned of its obligations under this agreement.
This Agreement will inure to the benefit of and be binding upon the
parties hereto and their respective successors, but will not be assignable by
either party hereto without the written consent of the other.
If this Agreement is acceptable to the Company, it is requested that
the Company sign the form of acceptance below and mail or deliver one of the
counterparts hereof to the undersigned at its address set forth below. This will
become a binding agreement, as of the date first above written, between the
Company and the undersigned when such counterpart is so mailed or delivered.
This Agreement shall be governed by and construed in accordance with
the internal laws of the State of New York.
Very truly yours,
---------------------------------------
(Purchaser)
By:
------------------------------------
------------------------------------
(Title)
------------------------------------
------------------------------------
(Address)
Accepted:
SOTHEBY'S HOLDINGS, INC.
By:
-------------------------
Name:
Title:
2
PURCHASER -- PLEASE COMPLETE AT TIME OF SIGNING
The name and telephone and department of the representative of the
Purchaser with whom details of delivery on the Delivery Date may be discussed is
as follows: (Please print.)
Telephone-No.
Name (Including Area Code) Department
-------------------- -------------------- --------------------
-------------------- -------------------- --------------------
3
SCHEDULE A
Securities:
Principal Amounts or Numbers to be Purchased:
Purchase Price:
Delivery:
