EXHIBIT 1.1
DRAFT 3/19/99
Apex Silver Mines Limited
_________ Shares
Ordinary Shares
($.01 par value)
Underwriting Agreement
New York, New York
[Date]
To the Representatives
named in Schedule I hereto
of the Underwriters named
in Schedule II hereto
Ladies and Gentlemen:
Apex Silver Mines Limited, a Cayman Islands corporation (the
"Company"), proposes to sell to the underwriters named in Schedule II hereto
(the "Underwriters"), for whom you (the "Representatives") are acting as
representatives, the number of shares of Ordinary Shares, $.01 par value
("Ordinary Shares"), of the Company set forth in Schedule I hereto (the
"Underwritten Securities"). The Company also proposes to grant to the
Underwriters an option to purchase up to the number of additional shares of
Ordinary Shares set forth in Schedule I hereto to cover over-allotments (the
"Option Securities;" the Option Securities, together with the Underwritten
Securities, being hereinafter called the "Securities"). To the extent there are
no additional Underwriters listed on Schedule I other than you, the term
Representatives as used herein shall mean you, as Underwriters, and the terms
Representatives and Underwriters shall mean either the singular or plural as the
context requires. Any reference herein to the Registration Statement, the Basic
Prospectus, any Preliminary Final Prospectus or the Final Prospectus shall be
deemed to refer to and include the documents incorporated by reference therein
pursuant to Item 12 of Form S-3 which were filed under the Exchange Act on or
before the Effective Date of the Registration Statement or the issue date of the
Basic Prospectus, any Preliminary Final Prospectus or the Final Prospectus, as
the case may be; and any reference herein to the terms "amend", "amendment" or
"supplement" with respect to the Registration Statement, the Basic Prospectus,
any Preliminary Final Prospectus or the Final Prospectus shall be deemed to
refer to and include the filing of any document under the Exchange Act or
pursuant to Rule 462(d) under the Act after the Effective Date of the
Registration Statement or the issue date of the Basic Prospectus, any
Preliminary Final Prospectus or the Final
Prospectus, as the case may be, deemed to be incorporated therein by reference.
Certain terms used herein are defined in Section 17 hereof.
1. Representations and Warranties. The Company represents and warrants to,
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and agrees with, each Underwriter as set forth below in this Section 1.
(a) The Company meets the requirements for use of Form S-3 under the
Act and has prepared and filed with the Commission a registration statement (the
file number of which is set forth in Schedule I hereto) on Form S-3, including a
related basic prospectus, for registration under the Act of the offering and
sale of the Securities. The Company may have filed one or more amendments or
supplements thereto, including a Preliminary Final Prospectus, each of which has
previously been furnished to you. The Company will next file with the Commission
one of the following: (1) after the Effective Date of such registration
statement, a final prospectus supplement relating to the Securities in
accordance with Rules 430A and 424(b), (2) prior to the Effective Date of such
registration statement, an amendment to such registration statement (including
the form of final prospectus supplement) or (3) a final prospectus in accordance
with Rules 415 and 424(b). In the case of clause (1), the Company has included
in such registration statement, as amended at the Effective Date, all
information (other than Rule 430A Information) required by the Act and the rules
thereunder to be included in such registration statement and the Final
Prospectus. As filed, such final prospectus supplement or such amendment and
form of final prospectus supplement shall contain all Rule 430A Information,
together with all other such required information, and, except to the extent the
Representatives shall agree in writing to a modification, shall be in all
substantive respects in the form furnished to you prior to the Execution Time
or, to the extent not completed at the Execution Time, shall contain only such
specific additional information and other changes (beyond that contained in the
Basic Prospectus and any Preliminary Final Prospectus) as the Company has
advised you, prior to the Execution Time, will be included or made therein. The
Registration Statement, at the Execution Time, meets the requirements set forth
in Rule 415(a)(1)(x).
(b) On the Effective Date, the Registration Statement did or will, and
when the Final Prospectus is first filed (if required) in accordance with Rule
424(b) and on the Closing Date (as defined herein) and on any date on which
Option Securities are purchased, if such date is not the Closing Date (a
"settlement date"), the Final Prospectus (and any supplement thereto) will,
comply in all material respects with the applicable requirements of the Act and
the Exchange Act and the respective rules thereunder; on the Effective Date and
at the Execution Time, the Registration Statement did not or will not contain
any untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary in order to make the statements
therein not misleading; and, on the Effective Date, the Final Prospectus, if not
filed pursuant to Rule 424(b), will not, and on the date of any filing pursuant
to Rule 424(b) and on the Closing Date and any settlement date, the Final
Prospectus (together with any supplement thereto) will not, include any untrue
statement of a material fact or omit 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; provided, however, that the Company makes no
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representations or warranties as to the information contained in or omitted from
the Registration Statement, or the Final Prospectus (or any supplement thereto)
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in reliance upon and in conformity with information furnished herein or in
writing to the Company by or on behalf of any Underwriter through the
Representatives specifically for inclusion in the Registration Statement or the
Final Prospectus (or any supplement thereto).
(c) The subsidiaries of the Company listed on Annex A hereto
(individually a "Significant Subsidiary" and collectively, the "Significant
Subsidiaries") are the only Significant Subsidiaries of the Company (within the
meaning of Rule 1-02 of Regulation S-X under the Act). The Company and each
Significant Subsidiary has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the jurisdiction in which it is
chartered or organized with full corporate power and authority to own its
properties and conduct its business as described in the Final Prospectus, and is
duly qualified to do business as a foreign corporation and is in good standing
under the laws of each jurisdiction which requires such qualification, except
where any failure to be so qualified would not individually or in the aggregate
have a material adverse effect on the condition (financial or otherwise),
prospects, earnings, business or properties of the Company and its subsidiaries,
taken as a whole.
(d) All the outstanding shares of capital stock of each Significant
Subsidiary have been duly and validly authorized and issued and are fully paid
and nonassessable, and, except as otherwise set forth in the Final Prospectus,
all outstanding shares of capital stock of the Subsidiaries are owned directly
or indirectly by the Company free and clear of any perfected security interest
or any other security interests, claims, liens or encumbrances.
(e) The Company's authorized equity capitalization is as set forth in
the Final Prospectus; the Ordinary Shares of the Company conform in all
material respects to the description thereof contained in the Final Prospectus;
the outstanding shares of Ordinary Shares have been duly and validly authorized
and issued and are fully paid and nonassessable; the Securities being sold
hereunder have been duly and validly authorized, and, when issued and delivered
to and paid for by the Underwriters pursuant to this Agreement, will be fully
paid and nonassessable; the Securities have been duly authorized for listing,
subject to official notice of issuance on the American Stock Exchange; the
certificates for the Securities are in valid and sufficient form; the holders of
outstanding shares of Ordinary Shares of the Company are not entitled to
preemptive or other rights to subscribe for the Securities; and, except as set
forth in the Final Prospectus, no options, warrants or other rights to purchase,
agreements or other obligations to issue, or rights to convert any obligations
into or exchange any securities for, shares of Ordinary Shares of or ownership
interests in the Company are outstanding.
(f) There is no franchise, contract or other document of a character
required to be described in the Registration Statement or Final Prospectus, or
to be filed as an exhibit thereto, which is not described or filed as required;
and the summaries of legal and regulatory matters and proceedings under the
headings ["Republic of Bolivia," "Description of Ordinary Shares" and "Title and
Ownership Rights" (under both of the "Development Project" and "Advanced
Exploration Properties" headings)] fairly summarize the matters therein
described.
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(g) This Agreement has been duly authorized, executed and delivered by
the Company and constitutes a valid and binding obligation of the Company
enforceable in accordance with its terms.
(h) The Company is not and, after giving effect to the offering and
sale of the Securities and the application of the proceeds thereof as described
in the Final Prospectus, will not be an "investment company" as defined in the
Investment Company Act of 1940, as amended.
(i) No consent, approval, authorization, filing with or order of any
court or governmental agency or body is required in connection with the
transactions contemplated herein, except such as have been obtained under the
Act and such as may be required under the blue sky laws of any jurisdiction in
connection with the purchase and distribution of the Securities by the
Underwriters in the manner contemplated herein and in the Final Prospectus.
(j) Neither the issue and sale of the Securities nor the consummation
of any other of the transactions herein contemplated nor the fulfillment of the
terms hereof will conflict with, result in a breach or violation or imposition
of any lien, charge or encumbrance upon any property or assets of the Company or
any of its subsidiaries pursuant to, (i) the charter or by-laws of the Company
or any of its subsidiaries or (ii) the terms of any indenture, contract, lease,
mortgage, deed of trust, note agreement, loan agreement or other agreement,
obligation, condition, covenant or instrument to which the Company or any of its
subsidiaries is a party or bound or to which their respective property is
subject, or (iii) any statute, law, rule, regulation, judgment, order or decree
applicable to the Company or any of its subsidiaries of any court, regulatory
body, administrative agency, governmental body, arbitrator or other authority
having jurisdiction over the Company or any of its subsidiaries or any of their
respective properties, which breach, violation or imposition would individually
or in the aggregate have a material adverse effect on the condition (financial
or otherwise), prospects, earnings, business or properties of the Company and
its subsidiaries, taken as a whole.
(k) Except as set forth in the Final Prospectus, no holders of
securities of the Company have rights to the registration of such securities
under the Securities Act.
(l) The consolidated financial statements and schedules of the Company
and its consolidated subsidiaries included in the Final Prospectus and the
Registration Statement present fairly in all material respects the financial
condition, results of operations and cash flows of the Company as of the dates
and for the periods indicated, comply as to form with the applicable accounting
requirements of the Act and the rules and regulations thereunder and have been
prepared in conformity with generally accepted accounting principles applied on
a consistent basis throughout the periods involved (except as otherwise noted
therein). The selected financial data set forth under the caption[s] ["Selected
Consolidated Financial Data"] in the Final Prospectus and Registration Statement
fairly present, on the basis stated in the Final Prospectus and the Registration
Statement, the information included therein.
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(m) No action, suit or proceeding by or before any court or
governmental agency, authority or body or any arbitrator involving the Company
or any of its subsidiaries or their respective properties is pending or
threatened that (i) could reasonably be expected to have a material adverse
effect on the performance of this Agreement or the consummation of any of the
transactions contemplated hereby or (ii) could reasonably be expected to have a
material adverse change in the condition (financial or otherwise), prospects,
earnings, business or properties of the Company and its subsidiaries, taken as a
whole, whether or not arising from transactions in the ordinary course of
business, except as set forth in or contemplated in the Final Prospectus
(exclusive of any supplement thereto) (except, in the case of this clause (ii),
for those that have been disclosed in the Final Prospectus).
(n) Except as set forth in the Final Prospectus, each of the Company
and each of its subsidiaries, owns or leases all such properties as are
necessary to the conduct of its operations as presently conducted and the
Company directly or indirectly through its subsidiaries owns, leases or
possesses the rights to all properties as are necessary to explore, develop and
exploit the San Xxxxxxxxx Project (as defined in the Final Prospectus) in
Bolivia, except where the failure to own, lease or possess the rights for any
property would not singularly or in the aggregate have a material adverse effect
on the condition (financial or otherwise), prospects, earnings, business or
properties of the Company and its subsidiaries, taken as a whole.
(o) Except as set forth in the Final Prospectus, neither the Company
nor any subsidiary is in violation of any law, rule or regulation of any foreign
national, federal, state or local governmental or regulatory authority
applicable to it or is not in non-compliance with any term or condition of, or
has failed to obtain and maintain in effect, any license, certificate, permit,
registration, concession, franchise, or other governmental authorization
required for the ownership or lease of its property or the conduct of its
business, which violation, non-compliance or failure would individually or in
the aggregate have a material adverse effect on the condition (financial or
otherwise), prospects, earnings, business or properties of the Company and its
subsidiaries, taken as a whole, whether or not arising from transactions in the
ordinary course of business, except as set forth in or contemplated in the Final
Prospectus; and the Company has not received notice of any proceedings relating
to the revocation or material modification of any such license, certificate,
permit or other authorization.
(p) Neither the Company nor any subsidiary is in violation or default
of (i) any provision of its charter or bylaws, (ii) the terms of any indenture,
contract, lease, mortgage, deed of trust, note agreement, loan agreement or
other agreement, obligation, condition, covenant or instrument to which it is a
party or bound or to which its property is subject, or (iii) any statute, law,
rule, regulation, judgment, order or decree of any court, regulatory body,
administrative agency, governmental body, arbitrator or other authority having
jurisdiction over the Company or such subsidiary or any of its properties, as
applicable, which violation or default would individually or in the aggregate
have a material adverse effect on the condition (financial or otherwise),
prospects, earnings, business or properties of the Company and its subsidiaries,
taken as a whole.
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(q) PriceWaterhouseCoopers LLP, who have certified certain financial
statements of the Company and its consolidated subsidiaries and delivered their
report with respect to the audited consolidated financial statements and
schedules included in the Final Prospectus, are independent public accountants
with respect to the Company within the meaning of the Act and the applicable
published rules and regulations thereunder.
(r) There are no transfer taxes or other similar fees or charges under
foreign national law, federal law or the laws of any state, or any political
subdivision thereof, required to be paid in connection with the execution and
delivery of this Agreement or the issuance by the Company or sale by the Company
of the Securities, except as set forth in the Final Prospectus or where the
failure to pay any such taxes, fees or charges would not individually or in the
aggregate have a material adverse effect on the condition (financial or
otherwise), prospects, earnings, business or properties of the Company and its
subsidiaries, taken as a whole.
(s) The Company has filed all foreign, federal, state and local tax
returns that are required to be filed or has requested extensions thereof
(except in any case in which the failure so to file would not have a material
adverse change in the condition (financial or otherwise), prospects, earnings,
business or properties of the Company and its subsidiaries, taken as a whole,
whether or not arising from transactions in the ordinary course of business,
except as set forth in or contemplated in the Final Prospectus and has paid all
taxes required to be paid by it and any other assessment, fine or penalty levied
against it, to the extent that any of the foregoing is due and payable, except
for any such assessment, fine or penalty that is currently being contested in
good faith or as described in or as would not have a material adverse change in
the condition (financial or otherwise), prospects, earnings, business or
properties of the Company and its subsidiaries, taken as a whole, whether or not
arising from transactions in the ordinary course of business, except as set
forth in or contemplated in the Final Prospectus.
(t) Except as set forth in the Final Prospectus, no labor dispute with
the employees of the Company or any of its subsidiaries exists or is threatened
or imminent that could result in a material adverse change in the condition
(financial or otherwise), prospects, earnings, business or properties of the
Company and its subsidiaries, taken as a whole, whether or not arising from
transactions in the ordinary course of business, except as set forth in or
contemplated in the Final Prospectus.
(u) The Company and each of its subsidiaries are insured by insurers
of recognized financial responsibility against such losses and risks and in such
amounts as are prudent and customary in the businesses in which they are
engaged; neither the Company nor any such subsidiary has been refused any
insurance coverage sought or applied for; and neither the Company nor any such
subsidiary has any reason to believe that it will not be able to renew its
existing insurance coverage as and when such coverage expires or to obtain
similar coverage from similar insurers as may be necessary to continue its
business at a cost that would not have a material adverse change in the
condition (financial or otherwise), prospects, earnings, business or properties
of the
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Company and its subsidiaries, taken as a whole, whether or not arising
from transactions in the ordinary course of business, except as set forth in or
contemplated in the Final Prospectus.
(v) No subsidiary of the Company is currently prohibited, directly or
indirectly, from paying any dividends to the Company, from making any other
distribution on such subsidiary's capital stock, from repaying to the Company
any loans or advances to such subsidiary from the Company or from transferring
any of such subsidiary's property or assets to the Company or any other
subsidiary of the Company, except as described in or contemplated by the Final
Prospectus or where such prohibition would have a material adverse effect on the
condition (financial or otherwise), prospects, earnings, business or properties
of the Company and its subsidiaries, taken as a whole.
(w) The Company and its subsidiaries possess all certificates,
authorizations, registrations, qualifications, licenses, concessions, franchises
and permits issued by the appropriate federal, state, foreign national or local
regulatory authorities necessary to conduct their respective businesses as
presently conducted, and neither the Company nor any such subsidiary has
received any notice of proceedings relating to the revocation or modification of
any such certificate, authorization, registration, qualification, license,
concession, franchise or permit which, singly or in the aggregate, if the
subject of an unfavorable decision, ruling or finding, would result in a
material adverse change in the condition (financial or otherwise), prospects,
earnings, business or properties of the Company and its subsidiaries, taken as a
whole, whether or not arising from transactions in the ordinary course of
business, except as set forth in or contemplated in the Final Prospectus.
(x) Neither the Company nor any of its subsidiaries is in violation of
any federal, state, foreign national or local law or regulation relating to
occupational safety and health or to the storage, handling or transportation of
hazardous or toxic materials and the Company and its subsidiaries have received
all permits, licenses or other approvals required of them under applicable
federal, state, foreign national and local occupational safety and health and
environmental laws and regulations to conduct their respective businesses as
presently conducted, and the Company and each such subsidiary is in compliance
with all terms and conditions of any such permit, license or approval, except
any such violation of law or regulation, failure to receive required permits,
licenses or other approvals or failure to comply with the terms and conditions
of such permits, licenses or approvals which would not, singly or in the
aggregate, result in a material adverse change in the condition (financial or
otherwise), prospects, earnings, business or properties of the Company and its
subsidiaries, taken as a whole, whether or not arising from transactions in the
ordinary course of business, except as set forth in or contemplated in the Final
Prospectus.
(y) The Company and each of its subsidiaries maintain a system of
internal accounting controls sufficient to provide reasonable assurance that (i)
transactions are executed in accordance with management's general or specific
authorizations; (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally accepted
accounting principles and to maintain asset accountability; (iii) access to
assets is permitted only in
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accordance with management's general or specific authorization; and (iv) the
recorded accountability for assets is compared with the existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences.
(z) The Company's independent technical consultants [Kvaerner Metals,
Davy Nonferrous Division, Mine Reserves Associates Inc., Xxxxxxx, Xxxxx & Xxxx,
Mineral Resources Development Inc., Knight Piesold LLC and Xxxxx Xxxxxxx] who
have affirmed and verified the proven and probable ore reserves located at the
San Xxxxxxxxx Project as of ________, 1999 and as set forth in or incorporated
by reference in the Final Prospectus are experts (as such term is used in
Section 11 (b) (3) of the Act) in the field of mining engineering and have
consented to being named in the Registration Statement.
(aa) The information set forth in the Registration Statement and the
Final Prospectus relating to the proven and probable ore reserves located at the
San Xxxxxxxxx Project as of _______, 1999 has been prepared materially in
accordance with methods generally applied in the mining industry and conforms in
all material respects to the rules and regulations of the Commission.
(bb) No stamp or other issuance or transfer taxes or duties and no
capital gains, income, withholding or other taxes are payable by or on behalf of
the several Underwriters to the Cayman Islands or any political subdivision or
taxing authority thereof or therein purely as a direct consequence of the issue
of Securities by the Company to or for the respective accounts of the several
Underwriters for resale and delivery to the initial purchasers thereof in the
manner contemplated herein.
(cc) The Shareholders' Agreements dated July, 1996 by and among the
Company, Apex Silver Mines LDC, Consolidated Commodities Ltd., Xx. Xxxxxx X.
Xxxxxx, Litani Capital Management LDC, Silver Holdings LDC and each shareholder
a signatory thereto have been duly authorized, executed and delivered and are
valid and binding obligations enforceable, against the parties thereto,
including, without limitation, the "Holdback" provisions of Section 7 thereto.
(dd) The Company has not taken, directly or indirectly, any action
designed to cause or to result in, or that has constituted or which might
reasonably be expected to constitute, the stabilization or manipulation of the
price of any security of the Company.
(ee) Subsequent to the respective dates as of which information is
given in the Final Prospectus, (i) the Company has not incurred any material
liability or obligation, direct or contingent, nor entered into any material
transaction in the ordinary course of business (other than the transactions
contemplated by this Underwriting Agreement); (ii) the Company has not purchased
any of its outstanding Common Stock, nor declared, paid or otherwise made any
dividend or distribution of any kind on its Common Stock; and (iii) there has
not been any material change in the capital stock, short-term debt or long-term
debt of the Company, except in each case as described in the Final Prospectus.
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(ff) The Company owns or possesses all material patents, patent
applications, trademarks, service marks, trade names, licenses, copyrights and
proprietary or other confidential information currently employed by it in
connection with its business, and the Company has not received any written
notice of infringement of, or conflict with, asserted rights of any third party
with respect to any of the foregoing which, individually or in the aggregate, if
the subject of an unfavorable decision, ruling or finding, would result in a
material adverse change in the condition (financial or otherwise), earnings,
business or properties of the Company, except as described in or contemplated in
the Final Prospectus or Prospectus Supplement.
Any certificate signed by any officer or director of the Company and
any executive officer of Apex Corporation and delivered to the Representatives
or counsel for the Underwriters in connection with the offering of the
Securities shall be deemed a representation and warranty by the Company, as to
matters covered thereby, to each Underwriter.
2. Purchase and Sale. (a) Subject to the terms and conditions and
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in reliance upon the representations and warranties herein set forth, the
Company agrees to sell to each Underwriter, and each Underwriter agrees,
severally and not jointly, to purchase from the Company, at the purchase price
per share set forth on Schedule I hereto, the amount of the Underwritten
Securities set forth opposite such Underwriter's name in Schedule II hereto.
(b) Subject to the terms and conditions and in reliance upon the
representations and warranties herein set forth, the Company hereby grants an
option to the several Underwriters to purchase, severally and not jointly, up to
the number of Option Securities set forth on Schedule I hereto at the same
purchase price per share as the Underwriters shall pay for the Underwritten
Securities. Said option may be exercised only to cover over-allotments in the
sale of the Underwritten Securities by the Underwriters. Said option may be
exercised in whole or in part at any time (but not more than once) on or before
the 30th day after the date of the Final Prospectus upon written or facsimile
notice by the Representatives to the Company setting forth the number of shares
of the Option Securities as to which the several Underwriters are exercising the
option and the settlement date. Delivery of certificates for the shares of
Option Securities by the Company, and payment therefor to the Company, shall be
made as provided in Section 3 hereof. The number of shares of the Option
Securities to be purchased by each Underwriter shall be the same percentage of
the total number of shares of the Option Securities to be purchased by the
several Underwriters as such Underwriter is purchasing of the Underwritten
Securities, subject to such adjustments as you in your absolute discretion shall
make to eliminate any fractional shares.
3. Delivery and Payment. Delivery of and payment for the
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Underwritten Securities and the Option Securities (if the option provided for in
Section 2(b) hereof shall have been exercised on or before the second Business
Day prior to the Closing Date) shall be made on the date and at the time
specified in Schedule I hereto, or at such time on such later date not more than
three Business Days after the foregoing date as the Representatives shall
designate, which date and time may be postponed by agreement between the
Representatives and the Company or as provided in
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Section 9 hereof (such date and time of delivery and payment for the Securities
being herein called the "Closing Date"). Delivery of the Securities shall be
made to the Representatives for the respective accounts of the several
Underwriters against payment by the several Underwriters through the
Representatives of the respective aggregate purchase prices of the Securities
being sold by the Company to or upon the order of the Company by wire transfer
payable in same-day funds to an account specified by the Company. Delivery of
the Underwritten Securities and the Option Securities shall be made through the
facilities of The Depository Trust Company unless the Representatives shall
otherwise instruct.
If the option provided for in Section 2(b) hereof is exercised after
the second business day prior to the Closing Date, the Company will deliver the
Option Securities (at the expense of the Company) to the Representatives, at 000
Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx, xx the date specified by the
Representatives (which shall be within three Business Days after exercise of
said option), certificates for the Option Securities in such names and
denominations as the Representatives shall have requested for the respective
accounts of the several Underwriters, against payment by the several
Underwriters through the Representatives of the purchase price thereof to or
upon the order of the Company by wire transfer payable in same-day funds to an
account specified by the Company. If settlement for the Option Securities
occurs after the Closing Date, the Company will deliver to the Representatives
on the settlement date for the Option Securities, and the obligation of the
Underwriters to purchase the Option Securities shall be conditioned upon receipt
of, supplemental opinions, certificates and letters confirming as of such date
the opinions, certificates and letters delivered on the Closing Date pursuant to
Section 6 hereof.
4. Offering by Underwriters. It is understood that the several
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Underwriters propose to offer the Securities for sale to the public as set forth
in the Final Prospectus.
5. Agreements. The Company agrees with the several Underwriters
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that:
(a) The Company will use its best efforts to cause the Registration
Statement, if not effective at the Execution Time, and any amendment thereof, to
become effective. Prior to the termination of the offering of the Securities,
the Company will not file any amendment of the Registration Statement or
supplement (including the Final Prospectus or any Preliminary Final Prospectus)
to the Basic Prospectus or any Rule 462(b) Registration Statement unless the
Company has furnished you a copy for your review prior to filing and will not
file any such proposed amendment or supplement to which you reasonably object.
Subject to the foregoing sentence, if the Registration Statement has become or
becomes effective pursuant to Rule 430A, or filing of the Final Prospectus is
otherwise required under Rule 424(b), the Company will cause the Final
Prospectus, properly completed, and any supplement thereto to be filed with the
Commission pursuant to the applicable paragraph of Rule 424(b) within the time
period prescribed and will provide evidence satisfactory to the Representatives
of such timely filing. The Company will promptly advise the Representatives (A)
when the Registration Statement, if not effective at the Execution Time, shall
have become effective, (B) when the Final Prospectus, and any supplement
thereto, shall have been filed (if required) with the Commission pursuant to
Rule 424(b) or when any
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Rule 462(b) Registration Statement shall have been filed with the Commission,
(C) when, prior to termination of the offering of the Securities, any amendment
to the Registration Statement shall have been filed or become effective, (D) of
any request by the Commission or its staff for any amendment of the Registration
Statement, or any Rule 462(b) Registration Statement, or for any supplement to
the Final Prospectus or for any additional information, (E) of the issuance by
the Commission of any stop order suspending the effectiveness of the
Registration Statement or the institution or threatening of any proceeding for
that purpose and (F) of the receipt by the Company of any notification with
respect to the suspension of the qualification of the Securities for sale in any
jurisdiction or the initiation or threatening of any proceeding for such
purpose. The Company will use its best efforts to prevent the issuance of any
such stop order or the suspension of any such qualification and, if issued, to
obtain as soon as possible the withdrawal thereof.
(b) If, at any time when a prospectus relating to the Securities is
required to be delivered under the Act, any event occurs as a result of which
either of the Final Prospectus as then supplemented would include any untrue
statement of a material fact or omit to state any material fact necessary to
make the statements therein in the light of the circumstances under which they
were made not misleading, or if it shall be necessary to amend the Registration
Statement or supplement either of the Final Prospectus to comply with the Act or
the Exchange Act or the respective rules thereunder, the Company promptly will
(i) notify the Representatives of such event, (ii) prepare and file with the
Commission, subject to the second sentence of paragraph (a) of this Section 5,
an amendment or supplement which will correct such statement or omission or
effect such compliance and (iii) supply any supplemented Final Prospectus to you
in such quantities as you may reasonably request.
(c) As soon as practicable, the Company will make generally available
to its security holders and to the Representatives an earnings statement or
statements of the Company and its subsidiaries which will satisfy the provisions
of Section 11(a) of the Act and Rule 158 under the Act.
(d) The Company will furnish to the Representatives and counsel for
the Underwriters, without charge, copies of the signed Registration Statement
(including exhibits thereto) and to each other Underwriter a copy of the
Registration Statement (without exhibits thereto) and, so long as delivery of a
prospectus by an Underwriter or dealer may be required by the Act or otherwise
required, as many copies of the Preliminary Final Prospectus and the Final
Prospectus and any supplement thereto as the Representatives may reasonably
request. The Company will pay the expenses of printing or other production of
all documents relating to the offering.
(e) The Company will cooperate with the Representatives and counsel
for the Representatives in connection with endeavoring to obtain qualification
of the Securities for sale under the laws of such jurisdictions as the
Representatives may designate, will maintain such qualifications in effect so
long as required for the distribution of the Securities and will pay any fee of
the National Association of Securities Dealers, Inc., in connection with its
review of the offering;
-11-
provided, however, that the Company shall not be required to file any general
consent to service of process or to qualify as a foreign corporation or as a
dealer in securities in any jurisdiction in which it is not otherwise so
subject.
(f) Until the Business Day set forth on Schedule I hereto, the Company
will not, without the prior written consent of Xxxxxxx Xxxxx Xxxxxx Inc, offer,
sell or contract to sell, pledge, or otherwise dispose of (or enter into any
transaction which is designed to, or might reasonably be expected to, result in
the disposition (whether by actual disposition or effective economic disposition
due to cash settlement or otherwise) by the Company or any affiliate of the
Company or any person in privity with the Company or any affiliate of the
Company) directly or indirectly, or announce the offering of, any other shares
of Ordinary Shares or any securities convertible into, or exchangeable for,
shares of Ordinary Shares; provided, however, that the Company may issue and
-------- -------
sell Ordinary Shares pursuant to any stock option plan, stock ownership plan or
dividend reinvestment plan of the Company in effect at the Execution Time and
described in the Final Prospectus; and the Company may issue Ordinary Shares
issuable upon the conversion of securities or the exercise of warrants
outstanding at the Execution Time or pursuant to the Buy-Sell Agreement as
disclosed in the Final Prospectus.
(g) The Company will not take, directly or indirectly, any action
designed to or which has constituted or which might reasonably be expected to
cause or result, under the Exchange Act or otherwise, in stabilization or
manipulation of the price of any security of the Company to facilitate the sale
or resale of the Securities.
6. Conditions to the Obligations of the Underwriters. The
--------------------------------------------------
obligations of the Underwriters to purchase the Underwritten Securities and the
Option Securities, as the case may be, shall be subject to the accuracy of the
representations and warranties on the part of the Company contained herein as of
the Execution Time, the Closing Date and any settlement date pursuant to Section
3 hereof, to the accuracy of the statements of the Company made in any
certificates pursuant to the provisions hereof, to the performance by the
Company of its obligations hereunder and to the following additional conditions:
(a) If the Registration Statement has not become effective prior to
the Execution Time, unless the Representatives agree in writing to a later time,
the Registration Statement will become effective not later than (i) 6:00 PM New
York City time on the date of determination of the public offering price, if
such determination occurred at or prior to 3:00 PM New York City time on such
date or (ii) 9:30 AM on the Business Day following the day on which the public
offering price was determined, if such determination occurred after 3:00 PM New
York City time on such date; if filing of either of the Final Prospectus, or any
supplement thereto, is required pursuant to Rule 424(b), the Final Prospectus,
and any such supplement, will be filed in the manner and within the time period
required by Rule 424(b); and no stop order suspending the effectiveness of the
Registration Statement shall have been issued and no proceedings for that
purpose shall have been instituted or threatened.
-12-
(b) The Company shall have furnished to the Representatives the
opinion of X.X. Xxxxxx & Company, Cayman Islands counsel for the Company, dated
the Closing Date, to the effect that:
(i) each of the Company and its subsidiaries that are
incorporated under the laws of the Cayman Islands (individually a "Cayman
Subsidiary" and collectively the "Cayman Subsidiaries") has been duly
incorporated and is validly existing as a corporation in good standing
under the laws of the Cayman Islands, with full corporate power and
authority to own its properties and conduct its business as described in
the Final Prospectus;
(ii) all the outstanding shares of capital stock of each Cayman
Subsidiary have been duly and validly authorized and issued and are fully
paid and, except as otherwise set forth in the Final Prospectus, all
outstanding shares of capital stock of the Cayman Subsidiaries are owned,
directly or indirectly, by the Company free and clear of any perfected
security interest and, to the knowledge of such counsel, after due inquiry,
any other security interests, claims, liens or encumbrances;
(iii) the outstanding shares of Ordinary Shares have been duly and
validly authorized and issued and are fully paid; the Securities being sold
hereunder by the Company have been duly and validly authorized and, when
issued and delivered to and paid for by the Underwriters pursuant to this
Agreement will be fully paid; the certificates for the Securities are in
valid and sufficient form; and the holders of outstanding shares of capital
stock of the Company are not entitled to preemptive or other rights to
subscribe for the Securities; and the liability of a shareholder in respect
of such Securities is limited to the amount that the shareholder has agreed
to pay for such Securities and the Company cannot call for additional sums
to be paid by the shareholders in respect of such Shares;
(iv) this Agreement has been duly authorized, executed and
delivered by the Company and constitutes the legal, valid and binding
obligations of the Company enforceable in accordance with its terms;
(v) to the knowledge of such counsel, there is no pending or
threatened action, suit or proceeding by or before any court or
governmental agency, authority or body or any arbitrator involving the
Company or any of the Cayman Subsidiaries of a character required to be
disclosed in the Registration Statement which is not adequately disclosed
in the Final Prospectus; and the summaries of legal and regulatory matters
and proceedings under the heading "Description of Ordinary Shares" fairly
summarize the matters therein described;
(vi) neither the issue and sale of the Securities, nor the
consummation of any other of the transactions contemplated herein nor the
fulfillment of the terms hereof or thereof will conflict with, result in a
breach or violation or imposition of any lien, charge or encumbrance upon
any property or assets of the Company or the Cayman Subsidiaries pursuant
to, (i) the Memorandum and Articles of Association of the Company or the
Cayman
-13-
Subsidiaries or (ii) any statute, law, rule, regulation, judgment,
order or decree applicable to the Company or the Cayman Subsidiaries of any
court, regulatory body, administrative agency, governmental body,
arbitrator or other authority having jurisdiction over the Company or the
Cayman Subsidiaries or any of its or their respective properties, except
where such breach, violation or imposition would not individually or in the
aggregate have a material adverse effect on the condition (financial or
otherwise), prospects, earnings, business or properties of the Company and
its subsidiaries, taken as a whole;
(vii) the Company's agreement to the choice of law provisions set
forth in Section 14 hereof will be recognized by the courts of the Cayman
Islands; the Company can xxx and be sued in its own name under the laws of
the Cayman Islands, the irrevocable submission of the Company to the non-
exclusive personal jurisdiction of a New York Court, the waiver by the
Company of any objection to the venue of a proceeding of a New York Court
and the agreement of the Company that this Agreement shall be governed by
and construed in accordance with the laws of the State of New York are
legal, valid and binding; and judgment obtained in a New York Court arising
out of or in relation to the obligations of the Company under this
Agreement, not being a sum payable in respect of taxes or other charges of
a like nature or a fine or other penalty, is enforceable against the
Company in the courts of the Cayman Islands; and
(viii) The Company is not entitled to any immunity on the basis of
sovereignty or otherwise in respect of its obligations under this Agreement
and could not successfully interpose any such immunity as a defense in any
suit or action brought or maintained in respect of its obligations under
this Agreement.
In rendering such opinion, such counsel may rely (A) as to matters
involving the application of laws of any jurisdiction other than the laws of the
Cayman Islands, to the extent they deem proper and specified in such opinion,
upon the opinion of other counsel of good standing whom they believe to be
reliable and who are satisfactory to counsel for the Underwriters and (B) as to
matters of fact, to the extent they deem proper, on certificates of responsible
officers of the Company and public officials. Reference to the Final Prospectus
in this paragraph (b) include any supplements thereto at the Closing Date.
(c) The Company shall have furnished to the Representatives the
opinion of Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P., counsel for the Company,
dated the Closing Date, to the effect that:
(i) each subsidiary of the Company incorporated in the United
States (individually a "Domestic Subsidiary" and collectively the "Domestic
Subsidiaries") has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the jurisdiction in which it
is chartered or organized, with full corporate power and authority to own
its properties and conduct its business as described in the Final
Prospectus, and is duly qualified to do business as a foreign corporation
and is in good standing under
-14-
the laws of each jurisdiction which requires such qualification, except
where such breach, violation or imposition would not individually or in the
aggregate have a material adverse effect on the condition (financial or
otherwise), prospects, earnings, business or properties of the Company and
its subsidiaries, taken as a whole;
(ii) all the outstanding shares of capital stock of each Domestic
Subsidiary have been duly and validly authorized and issued and are fully
paid and nonassessable, and, except as otherwise set forth in the Final
Prospectus, all outstanding shares of capital stock of the Domestic
Subsidiaries are owned by the Company, directly or indirectly, free and
clear of any perfected security interest and, to the knowledge of such
counsel, after due inquiry, any other security interests, claims, liens or
encumbrances;
(iii) the Securities being sold hereunder by the Company are duly
listed, and admitted and authorized for trading, subject to official notice
of issuance, on the American Stock Exchange; and, except as set forth in
the Final Prospectus, to such counsel's knowledge, no options, warrants or
other rights to purchase, agreements or other obligations to issue, or
rights to convert any obligations into or exchange any securities for,
shares of Ordinary Shares or ownership interests in the Company are
outstanding;
(iv) to the knowledge of such counsel, there is no pending or
threatened action, suit or proceeding by or before any court or
governmental agency, authority or body or any arbitrator involving the
Company or any of its subsidiaries of a character required to be disclosed
in the Registration Statement which is not adequately disclosed in the
Final Prospectus, and there is no franchise, contract or other document of
a character required to be described in the Registration Statement or Final
Prospectus, or to be filed as an exhibit thereto, which is not described or
filed as required; the descriptions contained in the Final Prospectus under
the heading "Taxation" constitute fair summaries of those statues and
regulations discussed therein applicable to the offering of the Securities;
(v) the Registration Statement has become effective under the
Act; any required filing of the Basic Prospectus, any Preliminary Final
Prospectus and the Final Pro spectus, and any supplements thereto,
pursuant to Rule 424(b) has been made in the manner and within the time
period required by Rule 424(b); to the knowledge of such counsel, no stop
order suspending the effectiveness of the Registration Statement has been
issued, no proceedings for that purpose have been instituted or threatened
and the Registration Statement and the Final Prospectus (other than the
financial statements and other financial information contained therein, as
to which such counsel need not express any opinion) comply as to form in
all material respects with the applicable requirements of the Act and the
Exchange Act and the respective rules thereunder; and such counsel has no
reason to believe that on the Effective Date or at the Execution Time the
Registration Statement contains or contained any untrue statement of a
material fact or omitted or omits to state any material fact required to be
stated therein or necessary to make the statements therein not misleading
or that the Final Prospectus as of their date and on the Closing Date
include any untrue statement of a material fact or omitted or omits to
state a material fact necessary to
-15-
make the statements therein, in the light of the circumstances under which
they were made, not misleading (in each case, other than the financial
statements and other financial information contained therein, as to which
such counsel need not express any opinion);
(vi) the Company is not and, after giving effect to the offering
and sale of the Securities and the application of the proceeds thereof as
described in the Final Prospectus, will not be an "investment company" as
defined in the Investment Company Act of 1940, as amended;
(vii) to such counsel's knowledge, no consent, approval,
authorization, filing with or order of any court or governmental agency or
body is required in connection with the transactions contemplated herein,
except such as have been obtained under the Act and such as may be required
under the blue sky laws of any jurisdiction (and the securities laws of any
jurisdiction outside the United States) in connection with the purchase and
distribution of the Securities by the Underwriters in the manner
contemplated in this Agreement and in the Final Prospectus and such other
approvals (specified in such opinion) as have been obtained;
(viii) to such counsel's knowledge, neither the issue and sale of
the Securities, nor the consummation of any other of the transactions
contemplated herein nor the fulfillment of the terms hereof will conflict
with, result in a breach or violation or imposition of any lien, charge or
encumbrance upon any property or assets of the Company or its subsidiaries
pursuant to, (i) the terms of any indenture, contract, lease, mortgage,
deed of trust, note agreement, loan agreement or other agreement,
obligation, condition, covenant or instrument, filed as a material contract
by the Company under the Exchange Act, to which the Company or its
subsidiaries is a party or bound or to which their respective property is
subject, or (ii) any statute, law, rule, regulation, judgment, order or
decree applicable to the Company or its subsidiaries of any court,
regulatory body, administrative agency, governmental body, arbitrator or
other authority having jurisdiction over the Company or its subsidiaries or
any of its or their respective properties, except where such breach,
violation or imposition would not individually or in the aggregate have a
material adverse effect on the condition (financial or otherwise),
prospects, earnings, business or properties of the Company and its
subsidiaries, taken as a whole; and
(ix) Except as set forth in the Final Prospectus, to such
counsel's knowledge, no holders of securities of the Company have rights to
the registration of such securities under the Securities Act.
In rendering such opinion, such counsel may rely (A) as to matters
involving the application of laws of any jurisdiction other than the State of
New York or the Federal laws of the United States, to the extent they deem
proper and specified in such opinion, upon the opinion of other counsel of good
standing whom they believe to be reliable and who are satisfactory to counsel
for the Underwriters and (B) as to matters of fact, to the extent they deem
proper, on certificates of
-16-
responsible officers of the Company and public officials. Reference to the Final
Prospectus in this paragraph (b) include any supplements thereto at the Closing
Date.
(d) The Company shall have furnished to the Representatives the
opinion of Xxxxxxxxxxx & Xxxxx, Bolivian counsel for the Company, dated the
Closing Date, with respect to matters of title and to corporate status in
Bolivia and other related matters as the Representatives may reasonably require.
(e) The Company shall have furnished to the Representatives the
opinion of Bufete Xxxxxxxxx-Xxxxx, Honduran counsel for the Company, dated the
Closing Date, with respect to matters of title and to corporate status in
Honduras and other related matters as the Representatives may reasonably
require.
(f) The Company shall have furnished to the Representatives the
opinion of ________________, Mexican counsel for the Company, dated the Closing
Date, with respect to matters of title and to corporate status in Mexico and
other related matters as the Representatives may reasonably require.
(g) The Representatives shall have received from Winston & Xxxxxx,
counsel for the Underwriters, such opinion or opinions, dated the Closing Date,
with respect to the issuance and sale of the Securities, the Registration
Statement, the Final Prospectus (together with any supplement thereto) and other
related matters as the Representatives may reasonably require, and the Company
shall have furnished to such counsel such documents as they request for the
purpose of enabling them to pass upon such matters.
(h) The Company shall have furnished to the Representatives a
certificate of the Company, signed by the Chairman of the Company and the Vice
President of Finance and Chief Financial Officer of Apex Corporation, dated the
Closing Date, to the effect that the signers of such certificate have carefully
examined the Registration Statement, the Final Prospectus, any supplements to
the Final Prospectus and this Agreement and that:
(i) the representations and warranties of the Company in this
Agreement are true and correct on and as of the Closing Date with the same
effect as if made on the Closing Date and the Company has complied with all
the agreements and satisfied all the conditions on its part to be performed
or satisfied at or prior to the Closing Date;
(ii) no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that purpose
have been instituted or, to the Company's knowledge, threatened; and
(iii) since the date of the most recent financial statements
included or incorporated by reference in the Final Prospectus (exclusive of
any supplement thereto), there has been no material adverse change in the
condition (financial or otherwise),
-17-
prospects, earnings, business or properties of the Company and its
subsidiaries, taken as a whole, whether or not arising from transactions in
the ordinary course of business, except as set forth in or contemplated in
the Final Prospectus (exclusive of any supplement thereto).
(i) At the Execution Time and at the Closing Date,
PriceWaterhouseCoopers, LLP shall have furnished to the Representatives letters,
dated respectively as of the Execution Time and as of the Closing Date, in form
and substance satisfactory to the Representatives, confirming that they are
independent accountants within the meaning of the Act and the Exchange Act and
the respective applicable rules and regulations thereunder and stating in effect
that:
(i) in their opinion the audited financial statements and
financial statement schedules included or incorporated by reference in the
Registration Statement and the Final Prospectus and reported on by them
comply as to form in all material respects with the applicable accounting
requirements of the Act and the Exchange Act and the related rules and
regulations thereunder;
(ii) on the basis of a reading of the latest unaudited financial
statements made available by the Company and its subsidiaries; their
limited review, in accordance with standards established under Statement on
Auditing Standards No. 71 of the unaudited interim financial information
for the _____ month period ended ____________, 199 and as at ___________,
1999, included or incorporated by reference into the Registration Statement
and the Final Prospectus; carrying out certain specified procedures (but
not an examination in accordance with generally accepted auditing
standards) which would not necessarily reveal matters of significance with
respect to the comments set forth in such letter; a reading of the minutes
of the meetings of the stockholders, directors and audit committees of the
Company and the Subsidiaries; and inquiries of certain officials of the
Company who have responsibility for financial and accounting matters of the
Company and its subsidiaries as to transactions and events subsequent to
December 31, 1998, nothing came to their attention which caused them to
believe that:
(1) any unaudited financial statements included or
incorporated by reference in the Registration Statement and the Final
Prospectus do not comply as to form in all material respects with
applicable accounting requirements of the Act and with the related
rules and regulations of the Commission with respect to registration
statements on Form S-3; and said unaudited financial statements are
not in conformity with generally accepted accounting principles
applied on a basis substantially consistent with that of the audited
financial statements included in the Registration Statement and the
Final Prospectus;
(2) with respect to the period subsequent to _________,
1999, there were any changes, at a specified date not more than five
days prior to the date of the letter, in the accumulated deficit of
the Company and its subsidiaries, long term debt or capital stock of
the Company or decreases in the shareholders' equity of
-18-
the Company as compared with the amounts shown on the __________,
1999, consolidated balance sheet included in the Registration
Statement and the Final Prospectus, or for the period from
___________, 1999 to such specified date there were any decreases, as
compared with the corresponding period in the preceding year; in net
revenues, interest income or in total or per share amounts of net
income or interest income of the Company and its subsidiaries, except
in all instances for changes or decreases set forth in such letter, in
which case the letter shall be accompanied by an explanation by the
Company as to the significance thereof unless said explanation is not
deemed necessary by the Representatives;
(3) the information included or incorporated by reference in
the Registration Statement and Final Prospectus in response to
Regulation S-K, Item 301 (Selected Financial Data), Item 302
(Supplementary Financial Information) and Item 402 (Executive
Compensation) is not in conformity with the applicable disclosure
requirements of Regulation S-K; and
(iii) they have performed certain other specified procedures as a
result of which they determined that certain information of an accounting,
financial or statistical nature (which is limited to accounting, financial
or statistical information derived from the general accounting records of
the Company and its subsidiaries) set forth in the Registration Statement
and the Final Prospectus and in Exhibit 12 to the Registration Statement,
including, but not limited to, the information set forth under the captions
"Summary Operating and Financial Information" and "Selected Financial
Information" in the Final Prospectus, the information included or
incorporated by reference in Items 1, 2, 6, 7 and 11 of the Company's
Annual Report on Form 10-K, incorporated by reference in the Registration
Statement and the Final Prospectus, and the information included in the
"Management's Discussion and Analysis of Financial Condition and Results of
Operations" included or incorporated by reference in the Company's
Quarterly Reports on Form 10-Q, incorporated by reference in the
Registration Statement and the Final Prospectus, agrees with the accounting
records of the Company and its subsidiaries, excluding any questions of
legal interpretation.
References to the Final Prospectus in this paragraph (i) include any
supplement thereto at the date of the letter.
(j) Subsequent to the Execution Time or, if earlier, the dates as of
which information is given in the Registration Statement (exclusive of any
amendment thereof) and the Final Prospectus (exclusive of any supplement
thereto), there shall not have been (i) any change or decrease specified in the
letter or letters referred to in paragraph (i) of this Section 6 or (ii) any
change, or any development involving a prospective change, in or affecting the
condition (financial or otherwise), earnings, business or properties of the
Company and its subsidiaries, taken as a whole, whether or not arising from
transactions in the ordinary course of business, except as set forth in or
contemplated in the Final Prospectus (exclusive of any supplement thereto) the
effect of which, in
-19-
any case referred to in clause (i) or (ii) above, is, in the sole reasonable
judgment of the Representatives, so material and adverse as to make it
impractical or inadvisable to proceed with the offering or delivery of the
Securities as contemplated by the Registration Statement (exclusive of any
amendment thereof) and the Final Prospectus (exclusive of any supplement
thereto).
(k) At the Execution Time, the Company shall have furnished to the
Representatives a letter substantially in the form of Annex B hereto from each
director of the Company and each executive officer of Apex Corporation addressed
to the Representatives, in which each such person agrees not to offer, sell,
contract to sell, pledge or otherwise dispose of, or file a registration
statement with the Commission in respect of, or establish or increase a put
equivalent position or liquidate or decrease a call equivalent position within
the meaning of Section 16 of the Exchange Act with respect to, any shares of
Ordinary Shares of the Company or any securities convertible into or exercisable
or exchangeable for such Ordinary Shares, or publicly announce an intention to
effect any such transaction, for a period of [180 days] after the date of this
Agreement, other than (i) any shares of Ordinary Shares to be sold hereunder,
(ii) any option or warrant or the conversion of a security outstanding on the
date hereof and referred to in the Prospectus to which this Agreement relates
and (iii) other than shares of Ordinary Shares disposed of as bona fide gifts
approved by Xxxxxxx Xxxxx Xxxxxx Inc.
(l) Prior to the Closing Date, the Company shall have furnished to the
Representatives such further information, certificates and documents as the
Representatives may reasonably request.
If any of the conditions specified in this Section 6 shall not have
been fulfilled in all material respects when and as provided in this Agreement,
or if any of the opinions and certificates mentioned above or elsewhere in this
Agreement shall not be in all material respects reasonably satisfactory in form
and substance to the Representatives and counsel for the Underwriters, this
Agreement and all obligations of the Underwriters hereunder may be canceled at,
or at any time prior to, the Closing Date by the Representatives. Notice of
such cancellation shall be given to the Company in writing or by telephone or
facsimile confirmed in writing.
The documents required to be delivered by this Section 6 shall be
delivered at the office of Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P., counsel
for the Company, at 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx, xx the Closing Date.
7. Reimbursement of Underwriters' Expenses. If the sale of the
----------------------------------------
Securities provided for herein is not consummated because any condition to the
obligations of the Underwriters set forth in Section 6 hereof is not satisfied,
because of any termination pursuant to Section 10 hereof or because of any
refusal, inability or failure on the part of the Company to perform any
agreement herein or comply with any provision hereof other than by reason of a
default by any of the Underwriters, the Company will reimburse the Underwriters
severally through Xxxxxxx Xxxxx Barney Inc on demand for all out-of-pocket
expenses (including reasonable fees and disbursements
-20-
of counsel) that shall have been incurred by them in connection with the
proposed purchase and sale of the Securities.
8. Indemnification and Contribution. (a) The Company agrees to
---------------------------------
indemnify and hold harmless each Underwriter, the directors, officers, employees
and agents of each Underwriter and each person who controls any Underwriter
within the meaning of either the Act or the Exchange Act against any and all
losses, claims, damages or liabilities, joint or several, to which they or any
of them may become subject under the Act, the Exchange Act or other Federal or
state statutory law or regulation, at common law or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon any untrue statement or alleged untrue statement of a
material fact contained in the registration statement for the registration of
the Securities as originally filed or in any amendment thereof, or in any Basic
Prospectus, any Preliminary Final Prospectus or the Final Prospectus, or in any
amendment thereof or supplement thereto, or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, and
agrees to reimburse each such indemnified party, as incurred, for any legal or
other expenses reasonably incurred by them in connection with investigating or
defending any such loss, claim, damage, liability or action; provided, however,
-------- -------
that (i) the Company will not be liable in any such case to the extent that any
such loss, claim, damage or liability arises out of or is based upon any such
untrue statement or alleged untrue statement or omission or alleged omission
made therein in reliance upon and in conformity with written information
furnished to the Company by or on behalf of any Underwriter through the
Representatives specifically for inclusion therein, and (ii) such indemnity with
respect to any Basic Prospectus or Preliminary Final Prospectus shall not inure
to the benefit of any Underwriter (or any person controlling such Underwriter)
from whom the person asserting such loss, claim, damage, or liability purchased
the Securities which are the subject thereof if such person did not receive a
copy of the Preliminary Final Prospectus (or the Final Prospectus as then
amended or supplemented if the Company shall have furnished any amendments or
supplements thereto) at or prior to the confirmation of the sale of such
Securities to such person in any case where such delivery is required by the Act
and the untrue statement or omission of a material fact contained in such Basic
Prospectus or Preliminary Final Prospectus was corrected in the Final Prospectus
(or the Final Prospectus as so amended or supplemented). This indemnity
agreement will be in addition to any liability which the Company may otherwise
have.
(b) Each Underwriter severally, and not jointly, agrees to indemnify
and hold harmless the Company, each of its directors and each person who
controls the Company within the meaning of either the Act or the Exchange Act,
to the same extent as the foregoing indemnity to each Underwriter, but only with
reference to written information relating to such Underwriter furnished to the
Company by or on behalf of such Underwriter through the Representatives
specifically for inclusion in the documents referred to in the foregoing
indemnity. This indemnity agreement will be in addition to any liability which
any Underwriter may otherwise have. The Company acknowledges that the
statements set forth in the last paragraph of the cover page regarding delivery
of the Securities, the stabilization legend in block capital letters on page
(ii) and, under the heading "Underwriting", (i) the sentences related to
concessions and reallowances and (ii) the paragraph
-21-
related to stabilization in any Preliminary Final Prospectus and the Final
Prospectus constitute the only information furnished in writing by or on behalf
of the several Underwriters for inclusion in any Preliminary Final Prospectus or
the Final Prospectus.
(c) Promptly after receipt by an indemnified party under this Section
8 of notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against the indemnifying party under this
Section 8, notify the indemnifying party in writing of the commencement thereof;
but the failure so to notify the indemnifying party (i) will not relieve it from
liability under paragraph (a) or (b) above unless and to the extent it did not
otherwise learn of such action and such failure results in the forfeiture by the
indemnifying party of substantial rights and defenses and (ii) will not, in any
event, relieve the indemnifying party from any obligations to any indemnified
party other than pursuant to the indemnification obligation provided in
paragraph (a) or (b) above. The indemnifying party shall be entitled to appoint
counsel of the indemnifying party's choice at the indemnifying party's expense
to represent the indemnified party in any action for which indemnification is
sought (in which case the indemnifying party shall not thereafter be responsible
for the fees and expenses of any separate counsel retained by the indemnified
party or parties except as set forth below); provided, however, that such
-------- -------
counsel shall be reasonably satisfactory to the indemnified party.
Notwithstanding the indemnifying party's election to appoint counsel to
represent the indemnified party in an action, the indemnified party shall have
the right to employ separate counsel (including local counsel), and the
indemnifying party shall bear the reasonable fees, costs and expenses of such
separate counsel if (i) the use of counsel chosen by the indemnifying party to
represent the indemnified party would present such counsel with a conflict of
interest, (ii) the actual or potential defendants in, or targets of, any such
action include both the indemnified party and the indemnifying party and the
indemnified party shall have reasonably concluded that there may be legal
defenses available to it and/or other indemnified parties which are different
from or additional to those available to the indemnifying party, (iii) the
indemnifying party shall not have employed counsel reasonably satisfactory to
the indemnified party to represent the indemnified party within a reasonable
time after notice of the institution of such action or (iv) the indemnifying
party shall authorize the indemnified party to employ separate counsel at the
expense of the indemnifying party. An indemnifying party will not, without the
prior written consent of the indemnified parties, settle or compromise or
consent to the entry of any judgment with respect to any pending or threatened
claim, action, suit or proceeding in respect of which indemnification or
contribution may be sought hereunder (whether or not the indemnified parties are
actual or potential parties to such claim or action) unless such settlement,
compromise or consent includes an unconditional release of each indemnified
party from all liability arising out of such claim, action, suit or proceeding.
(d) In the event that the indemnity provided in paragraph (a) or (b)
of this Section 8 is unavailable to or insufficient to hold harmless an
indemnified party for any reason, the Company and the Underwriters severally
agree to contribute to the aggregate losses, claims, damages and liabilities
(including legal or other expenses reasonably incurred in connection with
investigating or defending same) (collectively "Losses") to which the Company
and one or more of the Underwriters may be subject in such proportion as is
appropriate to reflect the relative benefits
-22-
received by the Company on the one hand and by the Underwriters on the other
hand from the offering of the Securities; provided, however, that in no case
-----------------
shall any Underwriter (except as may be provided in any agreement among
underwriters relating to the offering of the Securities) be responsible for any
amount in excess of the underwriting discount or commission applicable to the
Securities purchased by such Underwriter hereunder. If the allocation provided
by the immediately preceding sentence is unavailable for any reason, the Company
and the Underwriters severally shall contribute in such proportion as is
appropriate to reflect not only such relative benefits but also the relative
fault of the Company on the one hand and of the Underwriters on the other hand
in connection with the statements or omissions which resulted in such Losses as
well as any other relevant equitable considerations. Benefits received by the
Company shall be deemed to be equal to the total net proceeds from the offering
(before deducting expenses) received by it, and benefits received by the
Underwriters shall be deemed to be equal to the total underwriting discounts and
commissions, in each case as set forth on the cover page of the Final
Prospectus. Relative fault shall be determined by reference to, among other
things, whether any untrue or any alleged untrue statement of a material fact or
the omission or alleged omission to state a material fact relates to information
provided by the Company on the one hand or the Underwriters on the other hand,
the intent of the parties and their relative knowledge, access to information
and opportunity to correct or prevent such untrue statement or omission. The
Company and the Underwriters agree that it would not be just and equitable if
contribution were determined by pro rata allocation or any other method of
allocation which does not take account of the equitable considerations referred
to above. Notwithstanding the provisions of this paragraph (d), no person guilty
of fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. For purposes of this Section 8, each person who
controls an Underwriter within the meaning of either the Act or the Exchange Act
and each director, officer, employee and agent of an Underwriter shall have the
same rights to contribution as such Underwriter, and each person who controls
the Company within the meaning of either the Act or the Exchange Act, each
officer of the Company who shall have signed the Registration Statement, and
each director of the Company shall have the same rights to contribution as the
Company, subject in each case to the applicable terms and conditions of this
paragraph (d).
9. Default by an Underwriter. If any one or more Underwriters shall
--------------------------
fail to purchase and pay for any of the Securities agreed to be purchased by
such Underwriter or Underwriters hereunder and such failure to purchase shall
constitute a default in the performance of its or their obligations under this
Agreement, the remaining Underwriters shall be obligated severally to take up
and pay for (in the respective proportions which the amount of Securities set
forth opposite their names in Schedule II hereto bears to the aggregate amount
of Securities set forth opposite the names of all the remaining Underwriters)
the Securities which the defaulting Underwriter or Underwriters agreed but
failed to purchase; provided, however, that in the event that the aggregate
-------- -------
amount of Securities which the defaulting Underwriter or Underwriters agreed but
failed to purchase shall exceed 10% of the aggregate amount of Securities set
forth in Schedule II hereto, the remaining Underwriters shall have the right to
purchase all, but shall not be under any obligation to purchase any, of the
Securities, and if such nondefaulting Underwriters do not purchase
-23-
all the Securities, this Agreement will terminate without liability to any
nondefaulting Underwriter or the Company. In the event of a default by any
Underwriter as set forth in this Section 9, the Closing Date shall be postponed
for such period, not exceeding five Business Days, as the Representatives shall
determine in order that the required changes in the Registration Statement and
the Final Prospectus or in any other documents or arrangements may be effected.
Nothing contained in this Agreement shall relieve any defaulting Underwriter of
its liability, if any, to the Company and any nondefaulting Underwriter for
damages occasioned by its default hereunder.
10. Termination. This Agreement shall be subject to termination in
------------
the absolute discretion of the Representatives, by notice given to the Company
prior to delivery of and payment for the Securities, if at any time prior to
such time (i) trading in the Company's Ordinary Shares shall have been suspended
by the Commission or the American Stock Exchange or trading in securities
generally on the New York Stock Exchange, the American Stock Exchange or the
Nasdaq Stock Market shall have been suspended or limited or minimum prices shall
have been established on either of such Exchanges or the Nasdaq Stock Market,
(ii) a banking moratorium shall have been declared either by Federal or New York
State authorities or (iii) there shall have occurred any outbreak or escalation
of hostilities, declaration by the United States of a national emergency or war
or other calamity or crisis the effect of which on financial markets is such as
to make it, in the sole judgment of the Representatives, impractical or
inadvisable to proceed with the offering or delivery of the Securities as
contemplated by the Final Prospectus (exclusive of any supplement thereto).
11. Representations and Indemnities to Survive. The respective
-------------------------------------------
agreements, representations, warranties, indemnities and other statements of the
Company or its officers and of the Underwriters set forth in or made pursuant to
this Agreement will remain in full force and effect, regardless of any
investigation made by or on behalf of any Underwriter, or the Company or any of
the officers, directors, employees, agents or controlling persons referred to in
Section 8 hereof, and will survive delivery of and payment for the Securities.
The provisions of Sections 7 and 8 hereof shall survive the termination or
cancellation of this Agreement.
12. Notices. All communications hereunder will be in writing and
--------
effective only on receipt, and, if sent to the Representatives, will be mailed,
delivered or telefaxed to the Xxxxxxx Xxxxx Xxxxxx Inc General Counsel (fax no.:
(000) 000-0000) and confirmed to the General Counsel, care of Xxxxxxx Xxxxx
Barney Inc, at 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx, 00000, Attention:
General Counsel; or, if sent to the Company, will be mailed, delivered or
telefaxed to Xxxxx Xxxxxx (facsimile number (000) 000-0000) and confirmed to him
at Apex Silver Mines Corporation, 0000 Xxxxxxx Xxxxxx, Xxxxx 0000, Xxxxxx,
Xxxxxxxx 00000, attention of the Legal Department.
13. Successors. This Agreement will inure to the benefit of and be
-----------
binding upon the parties hereto and their respective successors and the
officers, directors, employees, agents and controlling persons referred to in
Section 8 hereof, and no other person will have any right or obligation
hereunder.
-24-
14. Applicable Law. This Agreement will be governed by and construed
---------------
in accordance with the laws of the State of New York applicable to contracts
made and to be performed in the state of New York.
15. Counterparts. This Agreement may be signed in one or more
------------
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same agreement.
16. Headings. The section headings used herein are for convenience
---------
only and shall not affect the construction hereof.
17. Definitions. The terms which follow, when used in this
------------
Agreement, shall have the meanings indicated.
"Act" shall mean the Securities Act of 1933, as amended , and the
rules and regulations of the Commission promulgated thereunder.
"Basic Prospectus" shall mean the prospectus referred to in paragraph
1(a) above contained in the Registration Statement at the Effective Date
including any Preliminary Final Prospectus.
"Business Day" shall mean any day other than a Saturday, a Sunday or a
legal holiday or a day on which banking institutions or trust companies are
authorized or obligated by law to close in New York City.
"Commission" shall mean the Securities and Exchange Commission.
"Effective Date" shall mean each date and time that the Registration
Statement, any post-effective amendment or amendments thereto and any Rule
462(b) Registration Statement became or become effective.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended , and the rules and regulations of the Commission promulgated
thereunder.
"Execution Time" shall mean the date and time that this Agreement is
executed and delivered by the parties hereto.
"Final Prospectus" shall mean the prospectus supplement relating to
the Securities that was first filed pursuant to Rule 424(b) after the
Execution Time, together with the Basic Prospectus.
-25-
"Preliminary Final Prospectus" shall mean any preliminary prospectus
supplement to the Basic Prospectus which describes the Securities and the
offering thereof and is used prior to filing of the Final Prospectus,
together with the Basic Prospectus.
"Registration Statement" shall mean the registration statement
referred to in paragraph 1(a) above, including exhibits and financial
statements, as amended at the Execution Time (or, if not effective at the
Execution Time, in the form in which it shall become effective) and, in the
event any post-effective amendment thereto or any Rule 462(b) Registration
Statement becomes effective prior to the Closing Date (as hereinafter
defined), shall also mean such registration statement as so amended or such
Rule 462(b) Registration Statement, as the case may be. Such term shall
include any Rule 430A Information deemed to be included therein at the
Effective Date as provided by Rule 430A.
"Rule 415", "Rule 424", "Rule 430A" and "Rule 462" refer to such rules
under the Act.
"Rule 430A Information" shall mean information with respect to the
Securities and the offering thereof permitted to be omitted from the
Registration Statement when it becomes effective pursuant to Rule 430A.
"Rule 462(b) Registration Statement" shall mean a registration
statement and any amendments thereto filed pursuant to Rule 462(b) relating
to the offering covered by the registration statement referred to in
Section 1(a) hereof.
-26-
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicate hereof, whereupon
this letter and your acceptance shall represent a binding agreement among the
Company and the several Underwriters.
Very truly yours,
Apex Silver Mines Limited
By: ______________________
Name:
Title:
The foregoing Agreement is hereby
confirmed and accepted as of the
date specified in Schedule I hereto.
Xxxxxxx Xxxxx Barney Inc
[ Name of Co-manager, if any]
By: _______________
Name:
Title:
For themselves and the other
several Underwriters named in
Schedule II to the foregoing
Agreement.
SCHEDULE I
----------
Underwriting Agreement dated: [Date]
Registration Statement No.: [ ]
Representatives: Xxxxxxx Xxxxx Xxxxxx Inc
Title, Purchase Price and Description of Securities:
Title: Ordinary Shares, par value $.01
Number of Ordinary Shares to be
sold by the Company: [ ]
Price to the Public per Ordinary Share: $
Price to the Public -- total: $
Underwriting Discount per Share: $
Underwriting Discount -- total $
Proceeds to the Company per Share: $
Proceeds to the Company -- total: $
Other Provisions: Option to purchase an
additional ________ Ordinary
Shares ("Option Securities")
Closing Date, Time and Location: [Date] at [Time]
Type of Offering: Non-delayed
Date referred to in Section [5(f)] after which the Company may offer or sell
securities issued or guaranteed by the company without the consent of the
Representatives: [ ] days after the [Execution Time]
Modification of items to be covered by the letter from PriceWaterhouseCoopers
LLP delivered pursuant to Section [6(e)] at the [Execution Time: None]
SCHEDULE II
-----------
Underwriters Number if Maximum Number Maximum Total
Underwritten of Option Securities Number of
Securities to be Available to be Securities Available
Purchased Purchased to be Purchased
--------------------------------------------------------------------------------
Xxxxxxx Xxxxx
Barney Inc.
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Total
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ANNEX A
-------
Significant Subsidiaries
Name Jurisdiction
---- --------------
Apex Silver Mines LDC Cayman Islands
ASM Holdings Limited Cayman Islands
Apex Silver Mines Corporation Delaware, USA
Apex Partners LDC Cayman Islands
Andean Silver Corporation Cayman Islands
ASC Peru LDC Cayman Islands
ASC Partners LDC Cayman Islands
ASC Bolivia LDC Cayman Islands
Apex Asia LDC Cayman Islands
'JSC' Kumushtak Kyrghyzstan
Kumushtak Management Company Kyrghyzstan
'Asgadmongu' Company Ltd. Mongolia
Kanimansur LTD Mining Joint Venture
(Formation Pending) Tajikistan
Minera de Cordilleras, S. de X.X. Honduras
Cordilleras Silver Mines Ltd. Bahamas
Cordilleras Silver Mines LDC Cayman Islands
Minera de Cordilleras, S. de X.X. de C.V. Mexico
Compania Minerales de Zacatecas, S. de X.X.
de C.V. Mexico
Compania Metalurgica Baronse, S. de X.X. de C.V. Mexico
Compania Metalurgica Largo, S. de X.X. de C.V. Mexico
SMRL Xxxxxx I de Ica (Formation Pending) Peru
ANNEX B
-------
[Letterhead of director of the Company or executive officer of Apex Corporation]
Apex Silver Mines Limited
-------------------------
Public Offering of Ordinary Shares
----------------------------------
____________,1999
Xxxxxxx Xxxxx Xxxxxx Inc
[ ]
As Representatives of the several Underwriters,
c/o Xxxxxxx Xxxxx Barney Inc
Seven Xxxxx Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
This letter is being delivered to you in connection with the proposed
Underwriting Agreement (the "Underwriting Agreement"), between Apex Silver Mines
Limited, a Cayman Islands corporation (the "Company"), and each of you as
representatives of a group of Underwriters named therein, relating to an
underwritten public offering of Ordinary Shares, $.01 par value (the "Ordinary
Shares"), of the Company.
In order to induce you and the other Underwriters to enter into the
Underwriting Agreement, the undersigned will not, without the prior written
consent of Xxxxxxx Xxxxx Xxxxxx Inc., offer, sell, contract to sell, pledge or
otherwise dispose of, or file a registration statement with the Commission in
respect of, or establish or increase a put equivalent position or liquidate or
decrease a call equivalent position within the meaning of Section 16 of the
Exchange Act with respect to, any shares of capital stock of the Company or any
securities convertible into or exercisable or exchangeable for such capital
stock, or publicly announce an intention to effect any such transaction, for a
period of 180 days after the date of this Agreement, other than (i) any shares
of Ordinary Shares to be sold hereunder, (ii) any option or warrant or the
conversion of a security outstanding on the date hereof and referred to in the
Prospectus to which this Agreement relates and (iii) shares of Ordinary Shares
disposed of as bona fide gifts approved by Xxxxxxx Xxxxx Xxxxxx, Inc.
If for any reason the Underwriting Agreement shall be terminated prior
to the Closing Date (as defined in the Underwriting Agreement), the agreement
set forth above shall likewise be terminated.
Yours very truly,
[Signature of officer or director]
[Name and address of officer or director]
