Comstock Resources, Inc. UNDERWRITING AGREEMENT dated October 6, 2009 Banc of America Securities LLC BMO Capital Markets Corp. J.P. Morgan Securities Inc. Scotia Capital (USA) Inc. Mitsubishi UFJ Securities (USA), Inc. Natixis Bleichroeder Inc. U.S....
Exhibit 1.1
Xxxxxxxx Resources, Inc.
dated October 6, 0000
Xxxx xx Xxxxxxx Securities LLC
BMO Capital Markets Corp.
X.X. Xxxxxx Securities Inc.
Scotia Capital (USA) Inc.
Mitsubishi UFJ Securities (USA), Inc.
Natixis Bleichroeder Inc.
U.S. Bancorp Investments, Inc.
Capital One Southcoast, Inc.
KeyBanc Capital Markets Inc.
Xxxxxx Xxxxxx & Company, Inc.
SunTrust Xxxxxxxx Xxxxxxxx, Inc.
BBVA Securities Inc.
Comerica Securities, Inc.
BMO Capital Markets Corp.
X.X. Xxxxxx Securities Inc.
Scotia Capital (USA) Inc.
Mitsubishi UFJ Securities (USA), Inc.
Natixis Bleichroeder Inc.
U.S. Bancorp Investments, Inc.
Capital One Southcoast, Inc.
KeyBanc Capital Markets Inc.
Xxxxxx Xxxxxx & Company, Inc.
SunTrust Xxxxxxxx Xxxxxxxx, Inc.
BBVA Securities Inc.
Comerica Securities, Inc.
October 6, 0000
XXXX XX XXXXXXX SECURITIES LLC
As Representatives of the several Underwriters
c/o BANC OF AMERICA SECURITIES LLC
0 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
As Representatives of the several Underwriters
c/o BANC OF AMERICA SECURITIES LLC
0 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Ladies and Gentlemen:
Introductory. Xxxxxxxx Resources, Inc., a Nevada corporation (the “Company”), proposes to
issue and sell to the several underwriters named in Schedule A hereto (the “Underwriters”), for
whom you (the “Representatives”) are acting as representatives, $300,000,000 principal amount of
its 8.375% Senior Notes due 2017 (the “Notes”). The Notes will be guaranteed (collectively, the
“Guarantees”) by each of the subsidiary guarantors named in Schedule B hereto (the “Notes
Guarantors”). The Notes and the Guarantees are collectively referred to herein as the
“Securities.” The Securities are to be issued under an indenture (the “Base Indenture”), to be
dated as of the Closing Date (as defined in Section 3 hereof), among the Company, the Notes
Guarantors and The Bank of New York Mellon Trust Company, N.A., as trustee (the “Trustee”), as
amended and supplemented by the First Supplemental Indenture (the “First Supplemental Indenture”)
to be dated as of the Closing Date, among the Company, the Notes Guarantors and the Trustee (the
Base Indenture, as supplemented and amended by the First Supplemental Indenture, being referred to
as the “Indenture”). To the extent there are no additional underwriters listed on Schedule A other
than you, the term Representatives as used herein shall mean you as the Underwriters, and the terms
Representatives and Underwriters shall mean either the singular or plural as the context requires.
The use of the neuter in this Underwriting Agreement (the “Agreement”) shall include the feminine
and masculine wherever appropriate.
The Company hereby confirms its engagement of SunTrust Xxxxxxxx Xxxxxxxx, Inc. (“SunTrust”) as, and
SunTrust hereby confirms its agreement with the Company to render services as, a “qualified
independent underwriter”, within the meaning of Section (f)(12) of NASD Rule 2720, as administered
by the Financial Industry Regulatory Authority (“FINRA”), with respect to the offering and sale of
the Notes. SunTrust, solely in its capacity as the qualified independent underwriter and not
otherwise, is referred to herein as the “QIU”. The QIU agrees that it will not be paid any
additional compensation by the Company in its capacity as such.
1. Representations and Warranties. The Company and each Notes Guarantor, jointly and
severally, represent and warrant to, and agree with, each of the Underwriters as of the date hereof
that:
(a) The Company has prepared and filed with the Securities and Exchange Commission (the
“Commission”) a registration statement on Form S-3 (File No. 333-162328), which contains a
base prospectus (the “Base Prospectus”), to be used in connection with the public offering
and sale of the Securities. Such registration statement, as amended, including the
financial statements, exhibits and schedules thereto, at each time of effectiveness under
the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder
(collectively, the “Securities Act”), including any required information deemed to be a part
thereof at the time of effectiveness pursuant to Rule 430B under the Securities Act or the
Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated
thereunder (collectively, the “Exchange Act”), is called the “Registration Statement.” Any
preliminary prospectus supplement to the Base Prospectus that describes the Notes and the
offering thereof and is used prior to filing of the final prospectus is called, together
with the Base Prospectus, a “preliminary prospectus.” The term “Prospectus” shall mean the
final prospectus relating to the Notes that is first filed pursuant to Rule 424(b) after the
date and time that this Agreement is executed and delivered by the parties hereto (the
“Execution Time”), including the Base Prospectus. Any reference herein to the Registration
Statement, any preliminary prospectus or the Prospectus shall be deemed to refer to and
include the documents incorporated by reference therein pursuant to Item 12 of Form S-3
under the Securities Act; any reference to any amendment or supplement to any preliminary
prospectus or the Prospectus shall be deemed to refer to and include any documents filed
after the date of such preliminary prospectus or Prospectus, as the case may be, under the
Exchange Act, and incorporated by reference in such preliminary prospectus or Prospectus, as
the case may be; and any reference to any amendment to the Registration Statement shall be
deemed to refer to and include any annual report of the Company filed pursuant to Section
13(a) or 15(d) of the Exchange Act after the effective date of the Registration Statement
that is incorporated by reference in the Registration Statement.
(b) Compliance with Registration Requirements. The Registration Statement has become
effective upon filing with the Commission under the Securities Act. No stop order
suspending the effectiveness of the Registration Statement is in effect, the Commission has
not issued any order or notice preventing or suspending the use of the Registration
Statement, any preliminary prospectus or the Prospectus and no proceedings for such purpose
or pursuant to Section 8A of the Securities Act have been instituted or are pending or, to
the best knowledge of the Company, are contemplated or threatened by the Commission.
Any preliminary prospectus and the Prospectus when filed complied in all material
respects with the Securities Act and the rules thereunder. Each of the Registration
Statement and any post-effective amendment thereto, at each time of effectiveness and at the
date hereof, complied and will comply in all material respects with the Securities Act and
did not and will not contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary in order to make the statements
therein not misleading. The Prospectus, as amended or supplemented, as of its date, at the
date hereof, at the time of any filing pursuant to Rule 424(b) and, at the Closing Date (as
defined herein), did not and will not contain any untrue statement of a material fact or
omit to state a material fact necessary in order to
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make the statements therein, in the light of the circumstances under which they were
made, not misleading. The representations and warranties set forth in the two immediately
preceding sentences do not apply to statements in or omissions from the Registration
Statement or any post-effective amendment thereto, or the Prospectus, or any amendments or
supplements thereto, made in reliance upon and in conformity with information relating to
any Underwriter furnished to the Company in writing by the Representatives expressly for use
therein, it being understood and agreed that the only such information furnished by the
Representatives consists of the information described as such in Section 8 hereof. There is
no contract or other document required to be described in the Prospectus or to be filed as
an exhibit to the Registration Statement that has not been described or filed as required.
The documents incorporated by reference in the Prospectus, when they became effective
or were filed with the Commission, as the case may be, conformed in all material respects to
the requirements of the Securities Act or the Exchange Act, as applicable. Any further
documents so filed and incorporated by reference in the Prospectus or any further amendment
or supplement thereto, when such documents become effective or are filed with the
Commission, as the case may be, will conform in all material respects to the requirements of
the Securities Act or the Exchange Act, as applicable.
(c) Well-Known Seasoned Issuer. (i) At the time of filing the Registration Statement,
(ii) at the time of the most recent amendment thereto for the purposes of complying with
Section 10(a)(3) of the Securities Act (whether such amendment was by post-effective
amendment, incorporated report filed pursuant to Section 13 or 15(d) of the Exchange Act or
form of prospectus), (iii) at the time the Company or any person acting on its behalf
(within the meaning, for this clause only, of Rule 163(c) of the Securities Act) made any
offer relating to the Securities in reliance on the exemption of Rule 163 of the Securities
Act, and (iv) at the Execution Time (with such date being used as the determination date for
purposes of this clause (iv)), the Company was and is a “well-known seasoned issuer” as
defined in Rule 405 of the Securities Act. The Registration Statement is an “automatic
shelf registration statement”, as defined in Rule 405 of the Securities Act that has been
filed with the Commission not earlier than three years prior to the date hereof, and the
Company has not received from the Commission any notice pursuant to Rule 401(g)(2) of the
Securities Act objecting to use of the automatic shelf registration statement form.
(d) Disclosure Package. The term “Disclosure Package” shall mean (i) the Base
Prospectus, including any preliminary prospectus supplement, (ii) the issuer free writing
prospectuses as defined in Rule 433 of the Securities Act (each, an “Issuer Free Writing
Prospectus”), if any, identified in Schedule C hereto, (iii) any other free writing
prospectus that the parties hereto shall hereafter expressly agree in writing to treat as
part of the Disclosure Package and (iv) the Final Term Sheet (as defined herein), which also
shall be identified in Schedule D hereto. As of 3:30 p.m. (Eastern time) on the date of
this Agreement (the “Applicable Time”), the Disclosure Package did not contain any untrue
statement of a material fact or omit to state any material fact necessary in order to make
the statements therein, in the light of the circumstances under which they were
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made, not misleading. The preceding sentence does not apply to statements in or
omissions from the Disclosure Package based upon and in conformity with written information
furnished to the Company by any Underwriter through the Representatives specifically for use
therein, it being understood and agreed that the only such information furnished by or on
behalf of any Underwriter consists of the information described as such in Section 8(b)
hereof.
(e) Company Not Ineligible Issuer. (i) At the earliest time after the filing of the
Registration Statement relating to the Securities that the Company or another offering
participant made a bona fide offer (within the meaning of Rule 164(h)(2)) of the Securities
Act and (ii) as of the date of the execution and delivery of this Agreement (with such date
being used as the determination date for purposes of this clause (ii)), the Company was not
and is not an Ineligible Issuer (as defined in Rule 405 of the Securities Act), without
taking account of any determination by the Commission pursuant to Rule 405 of the Securities
Act that it is not necessary that the Company be considered an Ineligible Issuer.
(f) Issuer Free Writing Prospectuses. Each Issuer Free Writing Prospectus, as of its
issue date and at all subsequent times through the completion of the offering of Securities
under this Agreement or until any earlier date that the Company notified or notifies the
Representatives as described in the next sentence, did not, does not and will not include
any information that conflicted, conflicts or will conflict with the information contained
in the Registration Statement or the Disclosure Package. If at any time following issuance
of an Issuer Free Writing Prospectus there occurred or occurs an event or development as a
result of which such Issuer Free Writing Prospectus conflicted or would conflict with the
information contained in the Registration Statement, the Company has promptly notified or
will promptly notify the Representatives and has promptly amended or supplemented or will
promptly amend or supplement, at its own expense, such Issuer Free Writing Prospectus to
eliminate or correct such conflict. Any issuer Free Writing Prospectus not identified on
Schedule C, when taken together with the Disclosure Package, did not, and at the Closing
Date will not, contain 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. The foregoing three sentences do not apply to
statements in or omissions from any Issuer Free Writing Prospectus based upon and in
conformity with written information furnished to the Company by any Underwriter through the
Representatives specifically for use therein, it being understood and agreed that the only
such information furnished by any Underwriter consists of the information described as such
in Section 8(b) hereof.
(g) Distribution of Offering Material by the Company. Neither the Company nor the Notes
Guarantors have distributed or will distribute, prior to the later of the Closing Date (as
defined below) and the completion of the Underwriters’ distribution of the Securities, any
offering material in connection with the offering and sale of the Securities other than the
Preliminary Prospectus, the Prospectus, any Issuer Free Writing Prospectus reviewed and
consented to by the Representatives or included in Schedule C hereto or the Registration
Statement.
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(h) No Applicable Registration or Other Similar Rights. There are no persons with
registration or other similar rights to have any equity or debt securities registered for
sale under the Registration Statement or included in the offering contemplated by this
Agreement, except for such rights as have been duly waived or are not applicable to the
offering of the Notes.
(i) Incorporation and Good Standing of the Company. 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 Disclosure Package and 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.
(j) Incorporation and Good Standing of the subsidiaries of the Company. Each
subsidiary of the Company has been duly organized, is validly existing as a corporation,
limited partnership or limited liability company in good standing under the laws of the
jurisdiction of its organization, has the corporate or partnership power and authority to
own its property and to conduct its business as described in the Disclosure Package and 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; all of the issued shares of capital stock or other ownership
interest of each subsidiary of the Company have been duly and validly authorized and issued,
are fully paid and non-assessable and are owned directly, or indirectly through one of the
other subsidiaries, by the Company, free and clear of all liens, encumbrances, equities or
claims, except for pledges of such shares or ownership interest pursuant to the Company’s
current bank credit facility described in the Disclosure Package and the Prospectus.
(k) This Agreement. This Agreement has been duly authorized, executed and delivered by
the Company and each of the Notes Guarantors.
(l) Capitalization. All of the shares of common stock, par value $.50 per share
(“Common Stock”), of the Company that are outstanding have been duly authorized and are
validly issued, fully paid and non-assessable.
(m) The Securities. The Notes 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 this Agreement, will be valid and
binding obligations of the Company, enforceable in accordance with their terms, subject to
applicable bankruptcy, insolvency or similar laws affecting creditors’ rights generally and
general principles of equity, and will be entitled to the benefits of the Indenture. Each
Guarantee has been duly authorized by such Notes Guarantor and, when
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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 this
Agreement, will be valid and binding obligations of the Notes Guarantors, enforceable in
accordance with their terms, subject to applicable bankruptcy, insolvency or similar laws
affecting creditors’ rights generally and general principles of equity, and will be entitled
to the benefits of the Indenture.
(n) The Indenture. The Indenture has been duly authorized and, at the Closing Date,
will have been duly qualified under the 1939 Act and duly executed and delivered by, and
will constitute a valid and binding agreement of, the Company and each of the Notes
Guarantors, enforceable in accordance with its terms, subject to applicable bankruptcy,
insolvency or similar laws affecting creditors’ rights generally and general principles of
equity.
(o) Description of Documents. The Notes, the Guarantees and the Indenture will conform
in all material respects to the respective statements relating thereto contained in the
Disclosure Package and the Prospectus and will be in substantially the respective forms
previously delivered to the Underwriters.
(p) No Conflict. The execution and delivery by the Company and the Notes Guarantors, as
the case may be, of, and the performance by the Company and the Notes Guarantors, as the
case may be, of their obligations under, this Agreement, the Indenture, and the Notes and
the Guarantees will not contravene any provision of applicable law or the certificate or
articles of incorporation or by-laws or other organizational documents of the Company or any
of the Notes Guarantors 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 or any of the Notes Guarantors of its obligations under this
Agreement, the Indenture, the Notes or the Guarantees, 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 Securities.
(q) No Material Adverse Change. There has not occurred any material adverse change, or
any development that can reasonably be expected to involve a 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 Disclosure Package and
the Prospectus (any such change is called a “Material Adverse Change”). Subsequent to the
respective dates as of which information is given in the Disclosure Package and the
Prospectus, (1) the Company and its subsidiaries have not incurred any material liability or
obligation, direct or contingent, nor entered into any material transaction not in the
ordinary course of business; (2) the Company has not purchased any of its outstanding
capital stock, nor declared, paid or otherwise made any dividend or distribution of any kind
on its capital stock other than ordinary and customary dividends; and (3) there has not been
any material change in the capital stock, short-term
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debt or long-term debt of the Company and its subsidiaries, except in each case as
described in the Disclosure Package and the Prospectus.
(r) No Material Actions or Proceedings. There are no legal or governmental proceedings
pending or, to the Company’s knowledge, 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 other than proceedings accurately described in all material respects
in the Disclosure Package and the Prospectus and proceedings that would not have a material
adverse effect on the Company and its subsidiaries, taken as a whole, or on the power or
ability of the Company and the Notes Guarantors to perform their obligations under this
Agreement, the Indenture, the Notes or the Guarantees or to consummate the transactions
contemplated by the Disclosure Package, the Prospectus and this Agreement.
(s) No Violation. Neither the Company nor any of its subsidiaries is in violation of
its certificate or articles of incorporation or by-laws, or other organizational documents,
or of any law, ordinance, administrative or governmental rule or regulation applicable to
the Company or any of its subsidiaries or of any judgement, order or decree of any
governmental body, agency or court having jurisdiction over the Company or any of its
subsidiaries, or in default in any material respect in the performance of any obligation,
agreement or condition contained in any bond, debenture, note or any other evidence of
indebtedness or in any material agreement, indenture, lease or other instrument to which the
Company or any of its subsidiaries is a party or by which any of them or any of their
respective properties may be bound.
(t) Independent Accountants. The accountants, Ernst & Young L.L.P, who have certified
or shall certify the financial statements included in the Disclosure Package and the
Prospectus, are independent public accountants as required by the Securities Act.
(u) Independent Petroleum Consultants. Xxx Xxxxxxx and Associates, Inc. are independent
petroleum consultants with respect to the Company and its subsidiaries.
(v) Preparation of Financial Statements. The consolidated historical financial
statements, together with related schedules and notes, included in the Disclosure Package
and the Prospectus comply as to form in all material respects with the requirements
applicable requirements of the Securities Act and the Exchange Act, as applicable. Such
historical financial statements present fairly the consolidated financial position, results
of operations and changes in financial position of the Company and its subsidiaries on the
basis stated in the Disclosure Package and the Prospectus at the respective dates or for the
respective periods to which they apply; such statements and related schedules and notes have
been prepared in accordance with generally accepted accounting principles consistently
applied throughout the periods involved, except as disclosed therein, and the supporting
schedules included or incorporated by reference in the Registration Statement present fairly
the information required to be stated therein. The other financial and statistical
information and data included in the Disclosure Package and the Prospectus are accurately
presented and prepared on a basis consistent with such financial statements and the books
and records of the Company and its subsidiaries. The pro forma financial
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statements, if any, included or incorporated by reference in the Disclosure Package and
the Prospectus have been prepared on a basis consistent with the historical financial
statements of the Company and its subsidiaries and give effect to assumptions used in the
preparation thereof on a reasonable basis and in good faith and present fairly the
transactions described therein; and such pro forma financial statements comply as to form in
all material respects with the Commission’s rules and guidance with respect to pro forma
financial statements. The other pro forma financial and statistical information and data ,
if any, included or incorporated by reference in the Disclosure Package and the Prospectus
are, in all material respects, accurately presented and prepared on a basis consistent with
the pro forma financial statements.
(w) Title to Properties. The Company and each of its subsidiaries has (1) generally
satisfactory title to all its interests in its oil and gas properties, title investigations
having been carried out by the Company and each of its subsidiaries in accordance with the
general practice in the oil and gas industry, (2) good and marketable title in fee simple to
all other real property owned by it and (3) good and marketable title to all personal
property owned by it, in each case free and clear of all liens, encumbrances, claims,
security interests, subleases and defects except such as are described in the Disclosure
Package and the Prospectus or such as do not materially affect the value of such property
and do not interfere with the use made and proposed to be made of such property by the
Company and its subsidiaries; and any real property and buildings held under lease by the
Company and its subsidiaries are held by them under valid, subsisting and enforceable leases
with such exceptions as are not material and do not interfere with the use made and proposed
to be made of such property and buildings of the Company and its subsidiaries.
(x) Environmental Laws. None of the Company or its subsidiaries has violated any
environmental safety or similar law or regulation applicable to its business relating to the
protection of human health and safety, the environment or hazardous or toxic substances or
wastes, pollutants or contaminants (“Environmental Laws”), lacks any permits, licenses or
other approvals required of them under applicable Environmental Laws to own, lease and
operate their respective properties and to conduct their business in the manner described in
the Disclosure Package and the Prospectus, is violating any terms and conditions of any such
permit, license or approval or has permitted to occur any event that allows, or after notice
or lapse of time would allow, revocation or termination of any such permit, license or
approval or result in any other impairment of their rights thereunder, which in each case
would have a material adverse effect on the Company and its subsidiaries, taken as a whole.
(y) Internal Controls. The Company and each of its subsidiaries maintain a system of
internal accounting controls sufficient to provide reasonable assurance that (1)
transactions are executed in accordance with management’s general or specific
authorizations; (2) transactions are recorded as necessary to permit preparation of
financial statements in conformity with generally accepted accounting principles and to
maintain asset accountability; (3) access to assets is permitted only in accordance with
management’s general or specific authorization; and (4) the recorded accountability for
assets is compared with the existing assets at reasonable intervals and appropriate action
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is taken with respect to any differences. Except as disclosed in the Disclosure
Package and the Prospectus, there are no material weaknesses in the Company’s internal
controls.
(z) Disclosure Controls and Procedures. The Company and its subsidiaries maintain an
effective system of “disclosure controls and procedures” (as defined in Rule 13a-15(e) of
the Exchange Act) that is designed to ensure that information required to be disclosed by
the Company in reports that it files or submits under the Exchange Act is recorded,
processed, summarized and reported within the time periods specified in the Commission’s
rules and forms, including controls and procedures designed to ensure that such information
is accumulated and communicated to the Company’s management as appropriate to allow timely
decisions regarding required disclosure; and the Company and its subsidiaries have carried
out evaluations of the effectiveness of their disclosure controls and procedures as required
by Rule 13a-15e of the Exchange Act.
(aa) Tax Law Compliance. The Company and each of its subsidiaries have filed all
material tax returns required to be filed, which returns are complete and correct in all
material respects, and neither the Company nor any of its subsidiaries is in default in the
payment of any taxes which were payable pursuant to said returns or any assessments with
respect thereto.
(bb) Intellectual Property Rights. The Company and its subsidiaries own or possess all
patents, trademarks, trademark registration, service marks, service xxxx registrations,
trade names, copyrights, licenses, inventions, trade secrets and rights described in the
Disclosure Package and the Prospectus as being owned by them or any of them or necessary for
the conduct of their respective businesses, and the Company is not aware of any claim to the
contrary or any challenge by any other person to the rights of the Company and its
subsidiaries with respect to the foregoing.
(cc) Insurance. The Company and its subsidiaries are insured by the 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 of its subsidiaries has been refused any insurance coverage sought or applied for; and
neither the Company nor any of its subsidiaries 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 effect on the Company and its subsidiaries,
taken as a whole, except as described in the Disclosure Package and the Prospectus.
(dd) Company Not an “Investment Company”. 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 Disclosure Package and the Prospectus, will not be an “investment company”
as such term is defined in the Investment Company Act of 1940, as amended (the “Investment
Company Act”).
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Any certificate signed by an officer of the Company and delivered to the
Representatives or to counsel for the Underwriters shall be deemed to be a representation
and warranty by the Company to each Underwriter as to the matters set forth therein.
2. Purchase and Sale. The Company agrees to issue and sell to the several
Underwriters the Notes upon the terms herein set forth. On the basis of the representations,
warranties and agreements herein contained, and upon the terms but subject to the conditions herein
set forth, the Underwriters agree, severally and not jointly, to purchase from the Company the
respective aggregate principal amount of Notes set forth opposite their names on Schedule
A. The purchase price per Note to be paid by the several Underwriters to the Company shall be
equal to 96.571% of the principal amount thereof.
3. Delivery and Payment; Representations and Warranties and Covenants of the
Underwriters.
(a) Delivery of certificates for the Securities to be purchased by the Underwriters and
payment therefor shall be made at the offices of Xxxxx Xxxxx L.L.P., 0000 Xxxx Xxxxxx, Xxxxx 000,
Xxxxxx, Xxxxx (or such other place as may be agreed to by the Company and the Representatives) at
9:00 a.m. New York time, on October 9, 2009, or such other time and date not later than the third
business day thereafter (the time and date of such closing are called the “Closing Date”).
(b) Public Offering of the Notes. The Representatives hereby advise the Company that the
Underwriters intend to offer for sale to the public, as described in the Disclosure Package and the
Prospectus, their respective portions of the Notes as soon after this Agreement has been executed
the Representatives, in their sole judgment, have determined is advisable and practicable.
(c) Payment for the Notes. Payment for the Notes shall be made on the Closing Date by wire
transfer of immediately available funds to the order of the Company.
It is understood that the Representatives have been authorized, for their own account and the
accounts of the several Underwriters, to accept delivery of and receipt for, and make payment of
the purchase price for, the Notes. Banc of America Securities LLC, individually and not as the
Representative of the Underwriters, may (but shall not be obligated to) make payment for any Notes
to be purchased by any Underwriter whose funds shall not have been received by the Representatives
by the Closing Date for the account of such Underwriter, but any such payment shall not relieve
such Underwriter from any of its obligations under this Agreement.
(d) Delivery of the Securities. Delivery of the Securities shall be made through the
facilities of The Depository Trust Company (“DTC”) unless the Representatives shall otherwise
instruct. Time shall be of the essence, and delivery at the time and place specified in this
Agreement is a further condition to the obligations of the Underwriters.
(e) Delivery of Prospectus to the Underwriters. Not later than 10:00 a.m. on the second
business day following the date the Notes are first released by the Underwriters for
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sale to the public, the Company shall deliver or cause to be delivered, copies of the
Prospectus in such quantities and at such places as the Representatives shall reasonably request.
4. Covenants. The Company and the Notes Guarantors, jointly and severally, covenant
and agree with each of the Underwriters as follows:
(a) Representatives Review of Proposed Amendments and Supplements. During the period
beginning at the Applicable Time and ending on the later of the Closing Date or such date,
as in the opinion of counsel for the Underwriters, the Prospectus is no longer required by
law to be delivered in connection with sales by an Underwriter or dealer, including in
circumstances where such requirement may be satisfied pursuant to Rule 172 (the “Prospectus
Delivery Period”), prior to amending or supplementing the Registration Statement, the
Disclosure Package or the Prospectus, the Company shall furnish to the Representatives for
review a copy of each such proposed amendment or supplement, and the Company shall not file
or use any such proposed amendment or supplement to which the Representatives reasonably
object.
(b) Securities Act Compliance. After the date of this Agreement and during the
Prospectus Delivery Period, the Company shall promptly advise the Representatives in writing
(i) when the Registration Statement, if not effective at the Execution Time, shall have
become effective, (ii) of the receipt of any comments of, or requests for additional or
supplemental information from, the Commission, (iii) of the time and date of any filing of
any post-effective amendment to the Registration Statement or any amendment or supplement to
any preliminary prospectus or the Prospectus, (iv) of the time and date that any
post-effective amendment to the Registration Statement becomes effective, and (v) of the
issuance by the Commission of any stop order suspending the effectiveness of the
Registration Statement or of any order or notice preventing or suspending the use of the
Registration Statement, any preliminary prospectus or the Prospectus, or of any receipt by
the Company of any notification with respect to the suspension of the qualification of the
Notes for sale in any jurisdiction or of the threatening or initiation of any proceedings
for any of such purposes (including any notice or order pursuant to Section 8A or Rule
401(g)(2) of the Securities Act). The Company shall use commercially reasonable efforts to
prevent the issuance of any such stop order or notice of prevention or suspension of such
use. If the Commission shall enter any such stop order or issue any such notice at any
time, the Company will use commercially reasonable efforts to obtain the lifting or reversal
of such order or notice at the earliest possible moment, or, subject to Section 4(a), will
file an amendment to the Registration Statement or will file a new registration statement
and use its best efforts to have such amendment or new registration statement declared
effective as soon as practicable. Additionally, the Company agrees that it shall comply
with the provisions of Rules 424(b) and 430B, as applicable, under the Securities Act,
including with respect to the timely filing of documents thereunder, and will use
commercially reasonable efforts to confirm that any filings made by the Company under such
Rule 424(b) were received in a timely manner by the Commission.
(c) Exchange Act Compliance. During the Prospectus Delivery Period, the Company will
file all documents required to be filed with the Commission pursuant to
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Section 13, 14 or 15 of the Exchange Act in the manner and within the time periods
required by the Exchange Act.
(d) Final Term Sheet. The Company will prepare a final term sheet containing solely a
description of the Notes, including the price at which the Notes are to be sold to the
public, in a form approved by the Representatives, and will file such term sheet pursuant to
Rule 433(d) under the Securities Act within the time required by such rule (such term sheet,
the “Final Term Sheet”).
(e) Permitted Free Writing Prospectuses. The Company represents that it has not made,
and agrees that, unless it obtains the prior written consent of the Representatives, it will
not make, any offer relating to the Notes that constitutes or would constitute an Issuer
Free Writing Prospectus or that otherwise constitutes or would constitute a “free writing
prospectus” (as defined in Rule 405 of the Securities Act) or a portion thereof required to
be filed by the Company with the Commission or retained by the Company under Rule 433 of the
Securities Act; provided that the prior written consent of the Representatives hereto shall
be deemed to have been given in respect of the Free Writing Prospectuses included in
Schedule C hereto and any electronic road show. Any such free writing prospectus consented
to by the Representatives is hereinafter referred to as a “Permitted Free Writing
Prospectus.” The Company agrees that (i) it has treated and will treat, as the case may be,
each Permitted Free Writing Prospectus as an Issuer Free Writing Prospectus, and (ii) has
complied and will comply, as the case may be, with the requirements of Rules 164 and 433 of
the Securities Act applicable to any Permitted Free Writing Prospectus, including in respect
of timely filing with the Commission, legending and record keeping. The Company consents to
the use by any Underwriter of a free writing prospectus that (a) is not an “issuer free
writing prospectus” as defined in Rule 433, or (b) contains only (1) information describing
the preliminary terms of the Securities or their offering, (2) information that describes
the final terms of the Securities or their offering and that is included in the Final Term
Sheet of the Company contemplated in Section 1(d)(iv) or (3) information permitted under
Rule 134 under the Securities Act; provided that each Underwriter severally covenants with
the Company not to take any action without the Company’s consent which consent shall be
confirmed in writing that would result in the Company being required to file with the
Commission under Rule 433(d) under the Securities Act a free writing prospectus prepared by
or on behalf of such Underwriter that otherwise would not be required to be filed by the
Company thereunder, but for the action of the Underwriter.
(f) Amendments and Supplements to the Registration Statement, Disclosure Package and
Prospectus and Other Security Act Matters. If, during the Prospectus Delivery Period, any
event or development shall occur or condition exist as a result of which the Disclosure
Package or the Prospectus as then amended or supplemented would include any untrue statement
of a material fact or omit to state any material fact necessary in order to make the
statements therein in the light of the circumstances under which they were made or then
prevailing, as the case may be, not misleading, or if it shall be necessary to amend or
supplement the Disclosure Package or the Prospectus, or to file under the Exchange Act any
document incorporated by reference in the Disclosure Package or the Prospectus, in order to
make the statements therein, in the light of the
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circumstances under which they were made or then prevailing, as the case may be, not
misleading, or if in the opinion of the Representatives it is otherwise necessary to amend
or supplement the Registration Statement, the Disclosure Package or the Prospectus, or to
file under the Exchange Act any document incorporated by reference in the Disclosure Package
or the Prospectus, or to file a new registration statement containing the Prospectus, in
order to comply with law, including in connection with the delivery of the Prospectus, the
Company agrees to (i) notify the Representatives of any such event or condition and (ii)
promptly prepare (subject to Section 4(a) and 4(e) hereof), file with the Commission (and
use its best efforts to have any amendment to the Registration Statement or any new
registration statement to be declared effective) and furnish at its own expense to the
Underwriters and to dealers, amendments or supplements to the Registration Statement, the
Disclosure Package or the Prospectus, or any new registration statement, necessary in order
to make the statements in the Disclosure Package or the Prospectus as so amended or
supplemented, in the light of the circumstances under which they were made or then
prevailing, as the case may be, not misleading or so that the Registration Statement, the
Disclosure Package or the Prospectus, as amended or supplemented, will comply with law.
(g) Copies of any Amendments and Supplements to the Prospectus. The Company agrees to
furnish the Representatives, without charge, during the Prospectus Delivery Period, as many
copies of the Prospectus and any amendments and supplements thereto (including any documents
incorporated or deemed incorporated by reference therein) and the Disclosure Package as the
Representatives may request.
(h) Copies of the Registration Statements and the Prospectus. The Company will furnish
to the Representatives and counsel for the Underwriters signed copies of the Registration
Statement (including exhibits thereto) and, during the Prospectus Delivery Period, as many
copies of each preliminary prospectus, the Prospectus and any supplement thereto and the
Disclosure Package as the Representatives may reasonably request.
(i) Blue Sky Compliance. The Company shall cooperate with the Representatives and
counsel for the Underwriters to qualify or register the Securities for sale under (or obtain
exemptions from the application of) the state securities or blue sky laws or Canadian
provincial securities laws or other foreign laws of those jurisdictions designated by the
Representatives and consented to by the Company, and the Company shall comply in all
material respects with such laws and shall continue such qualifications, registrations and
exemptions in effect so long as required for the distribution of the Securities. The
Company shall not be required to qualify as a foreign corporation or to take any action that
would subject it to general service of process in any such jurisdiction where it is not
presently qualified or where it would be subject to taxation as a foreign corporation, other
than those arising out of the offering or sale of the Securities in any jurisdiction where
it is not now so subject. The Company will advise the Representatives promptly of the
suspension of the qualification or registration of (or any such exemption relating to) the
Securities for offering, sale or trading in any jurisdiction or any initiation or threat of
any proceeding for any such purpose, and in the event of the issuance of any order
suspending such qualification, registration or
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exemption, the Company shall use its best efforts to obtain the withdrawal thereof at
the earliest possible moment.
(j) Use of Proceeds. The Company shall apply the net proceeds from the sale of the
Securities sold by it in the manner described under the caption “Use of Proceeds” in each of
the Disclosure Package and the Prospectus.
(k) Agreement Not to Offer to Sell Additional Securities. During the period of 60 days
following the date of the Prospectus, the Company will not, without the prior written
consent of Banc of America Securities LLC (which consent may be withheld at the sole
discretion of Banc of America Securities LLC), directly or indirectly, sell, offer, contract
or grant any option to sell, pledge, transfer or establish an open “put equivalent position”
within the meaning of Rule 16a-1 under the Exchange Act, or otherwise dispose of or
transfer, or announce the offering of, or file any registration statement under the
Securities Act in respect of, any debt securities of the Company or securities exchangeable
for or convertible into debt securities of the Company (other than as contemplated by this
Agreement).
(l) DTC. The Company shall use commercially reasonable efforts to obtain the approval
of DTC to permit the Notes to be eligible for “book-entry” transfer and settlement through
the facilities of DTC, and agrees to comply with all of its agreements set forth in the
representation letters of the Company to DTC relating to the approval of the Notes by DTC
for “book-entry” transfer.
(m) Earnings Statement. As soon as practicable, the Company will make generally
available to its security holders and to the Representatives an earnings statement (which
need not be audited) covering the twelve-month period ending September 30, 2009 that
satisfies the provisions of Section 11(a) of the Securities Act and Rule 158 under the
Securities Act.
(n) Periodic Reporting Obligations. During the Prospectus Delivery Period the Company
shall file, on a timely basis, with the Commission and the New York Stock Exchange all
reports and documents required to be filed under the Exchange Act.
(o) Filing Fees. The Company agrees to pay the required Commission filing fees relating
to the Securities within the time required by Rule 456(b)(1) of the Securities Act without
regard to the proviso therein and otherwise in accordance with Rules 456(b) and 457(r) of
the Securities Act.
(p) Compliance with Xxxxxxxx-Xxxxx Act. The Company will comply with all applicable
securities and other laws, rules and regulations, including, without limitation, the
Xxxxxxxx-Xxxxx Act, and use its best efforts to cause the Company’s directors and officers,
in their capacities as such, to comply with such laws, rules and regulations, including,
without limitation, the provisions of the Xxxxxxxx-Xxxxx Act.
(q) Future Reports to the Representatives. During the period of two years hereafter the
Company will furnish to the Representatives (i) to the extent not available on the
Commission’s XXXXX filing system, as soon as practicable after the end of each
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fiscal year, copies of the Annual Report of the Company containing the balance sheet of
the Company as of the close of such fiscal year and statements of income, stockholders’
equity and cash flows for the year then ended and the opinion thereon of the Company’s
independent public or certified public accountants; (ii) to the extent not available on the
Commission’s XXXXX filing system, as soon as practicable after the filing thereof, copies of
each proxy statement, Annual Report on Form 10-K, Quarterly Report on Form 10-Q, Current
Report on Form 8-K or other report filed by the Company with the Commission, FINRA or any
securities exchange; and (iii) to the extent not available on the Commission’s XXXXX filing
system, as soon as available, copies of any publicly available report or communication of
the Company mailed generally to holders of its capital stock.
(r) No Manipulation of Price. The Company will not take, directly or indirectly, any
action designed to cause or result in, or that has constituted or might reasonably be
expected to constitute, under the Exchange Act or otherwise, the stabilization or
manipulation of the price of any securities of the Company to facilitate the sale or resale
of the Securities.
(s) Investment Limitation. The Company shall not invest, or otherwise use the proceeds
received by the Company from its sale of the Notes in such a manner as would require the
Company or any of its subsidiaries to register as an investment company under the Investment
Company Act.
5. Payment of Expenses. The Company agrees to pay all costs, fees and expenses
incurred in connection with the performance of its obligations hereunder and in connection with the
transactions contemplated hereby, including without limitation (i) all expenses incident to the
issuance and delivery of the Securities (including all printing and engraving costs), (ii) all
necessary issue, transfer and other stamp taxes in connection with the issuance and sale of the
Securities to the Underwriters, (iii) all fees and expenses of the Company’s and the Notes
Guarantors’ counsel, independent public or certified public accountants, independent petroleum
consultants and other advisors, (iv) all costs and expenses incurred in connection with the
preparation, printing, filing, shipping and distribution of Registration Statement (including
financial statements, exhibits, schedules, consents and certificates of experts), each Issuer Free
Writing Prospectus, each preliminary prospectus and the Prospectus, and all amendments and
supplements thereto, and the mailing and delivering of copies thereof to the Underwriters and
dealers, this Agreement, the Indenture and the Securities, (v) all filing fees, attorneys’ fees and
expenses incurred by the Company, the Notes Guarantors or the Underwriters in connection with
qualifying or registering (or obtaining exemptions from the qualification or registration of) all
or any part of the Securities for offer and sale under the securities laws of the several states of
the United States, the provinces of Canada or other jurisdictions designated by the Underwriters
(including, without limitation, the cost of preparing, printing and mailing preliminary and final
blue sky or legal investment memoranda), (vi) the fees and expenses of the Trustee, including the
fees and disbursements of counsel for the Trustee in connection with the Indenture and the
Securities, (vii) any fees payable in connection with the rating of the Securities with the ratings
agencies, (viii) any filing fees incident to, and any reasonable fees and disbursements of counsel
to the Underwriters in connection with the review by FINRA, if any, of the terms of the sale of the
Securities, (ix) all fees and expenses (including reasonable fees and expenses of counsel) of
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the Company and the Notes Guarantors in connection with approval of the Securities by the DTC
for “book-entry” transfer, and the performance by the Company and the Notes Guarantors of their
respective other obligations under this Agreement, (x) all expenses incident to the “road show” for
the offering of the Securities, (xi) all other fees, costs and expenses referred to in Item 14 of
Part II of the Registration Statement, (xi) the fees and expenses of the QIU, if any, and (xiii)
all other costs and expenses incident to the performance of its obligations hereunder which are not
otherwise specifically provided for in this Section 5. It is understood, however, that, except as
provided in this Section 5, and Section 8 hereof, the Underwriters will pay all of their own costs
and expenses, including the fees and expenses of their counsel.
6. Conditions to the Obligations of the Underwriters. The obligations of the
Underwriters hereunder shall be subject, in their discretion, to the condition that all
representations and warranties and other statements of the Company and each Notes Guarantor herein
are, at and as of the date hereof and the Closing Date, true and correct, the condition that the
Company and each Notes Guarantor shall have performed all of their respective obligations hereunder
theretofore to be performed, and the following additional conditions:
(a) Accountants’ Comfort Letter. On the date hereof, the Representatives shall have
received from Ernst & Young LLP, independent public accountants for the Company, a letter
dated the date hereof addressed to the Underwriters, in form and substance satisfactory to
the Representatives, covering the financial information in the Disclosure Package and other
customary information.
(b) Compliance with Registration Requirements; No Stop Order; No Objection from FINRA.
For the period from and after effectiveness of this Agreement and prior to the Closing Date
and, with respect to the Securities:
(i) the Company shall have filed the Prospectus with the Commission (including
the information required by Rule 430B under the Securities Act) in the manner and
within the time period required by Rule 424(b) under the Securities Act;
(ii) the Final Term Sheet, and any other material required to be filed by the
Company pursuant to Rule 433(d) under the Securities Act, shall have been filed with
the Commission within the applicable time periods prescribed for such filings under
such Rule 433;
(iii) no stop order suspending the effectiveness of the Registration Statement,
or any post-effective amendment to the Registration Statement, shall be in effect
and no proceedings for such purpose or pursuant to 8A of the Securities Act shall
have been instituted or threatened by the Commission; and the Company shall not have
received from the Commission any notice pursuant to Rule 401(g)(2) of the Securities
Act objecting to use of the automatic shelf registration statement form; and
(iv) FINRA shall have raised no objection to the fairness and reasonableness of
the underwriting terms and arrangements.
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(c) No Material Adverse Change or Ratings Agency Change. For the period from and after
the date of this Agreement and prior to the Closing Date:
(i) in the reasonable judgment of the Representatives there shall not have
occurred any Material Adverse Change;
(ii) there shall not have been any change or decrease specified in the letter
or letters referred to in paragraph (a) of this Section 6 which is, in the sole
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 and the Prospectus; and
(iii) there shall not have occurred any downgrading, nor shall any notice have
been given of any intended or potential downgrading or of any review for a possible
change that does not indicate the direction of the possible change, in the rating
accorded any debt securities of the Company or any of its subsidiaries by any
“nationally recognized statistical rating organization” as such term is defined for
purposes of Rule 436(g)(2) under the Securities Act.
(d) Opinion of Counsel for the Company. On the Closing Date, the Representatives shall
have received the favorable opinion of Xxxxx Lord Xxxxxxx & Xxxxxxx LLP, counsel for the
Company, dated as of such Closing Date, the form of which is attached as Exhibit A.
(e) Opinion of Counsel for the Underwriters. On the Closing Date, the Representatives
shall have received the favorable opinion of Xxxxx Xxxxx L.L.P., counsel for the
Underwriters, dated as of such Closing Date, in form and substance satisfactory to, and
addressed to, the Representatives, with respect to the issuance and sale of the Notes, the
Registration Statement, the Prospectus (together with any supplement thereto), the
Disclosure Package 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.
(f) Officers’ Certificate. On the Closing Date and any Subsequent Closing Date, the
Representatives shall have received a written certificate executed by the Chairman of the
Board, Chief Executive Officer or President of the Company and the Chief Financial Officer
or Chief Accounting Officer of the Company, dated as of such Closing Date, to the effect
that the signers of such certificate have carefully examined the Registration Statement, the
Prospectus and any amendment or supplement thereto, any Issuer Free Writing Prospectus and
any amendment or supplement thereto and this Agreement, to the effect set forth in
subsections (b) and (c)(iii) of this Section 6, and further to the effect that:
(i) for the period from and after the date of this Agreement and prior to such
Closing Date, there has not occurred any Material Adverse Change;
(ii) the representations, warranties and covenants of the Company set forth in
Section 1 of this Agreement are true and correct on and as of the Closing
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Date with the same force and effect as though expressly made on and as of such
Closing Date; and
(iii) the Company has complied with all the agreements hereunder and satisfied
all the conditions on its part to be performed or satisfied hereunder at or prior to
such Closing Date.
(g) Bring-down Accountants’ Comfort Letter. On the Closing Date, the Representatives
shall have received from Ernst & Young LLP, independent public accountants for the Company,
a letter dated such date, in form and substance satisfactory to the Representatives, to the
effect that they reaffirm the statements made in the letter furnished by them pursuant to
subsection (a) of this Section 6, except that (i) it shall cover the financial information
in the Prospectus and any amendment or supplement thereto and (ii) the specified date
referred to therein for the carrying out of procedures shall be no more than three business
days prior to the Closing Date.
(h) The Securities and the Indenture shall be executed by the Company, or the Notes
Guarantors, as the case may be, in substantially the form previously delivered to you.
(i) At the Closing Date, the Company and the Notes Guarantors shall have furnished
counsel for the Company, the Notes Guarantors or the Underwriters, as the case may be, such
documents as they reasonably require for the purpose of enabling them to pass upon the
issuance and sale of the Securities as herein contemplated, or in order to evidence the
accuracy of any of the representations or warranties or fulfillment of any of the conditions
herein contained.
If any condition specified in this Section 6 is not satisfied when and as required to
be satisfied, this Agreement may be terminated by the Representatives by notice to the
Company at any time on or prior to the Closing Date, which termination shall be without
liability on the part of any party to any other party, except that Section 5, Section 7,
Section 8 and Section 9 shall at all times be effective and shall survive such termination.
7. Reimbursement of Underwriters’ Expenses. If this Agreement is terminated by the
Representatives pursuant to Section 6 or clause (i)(A) or (iii) of Section 11, or if the sale to
the Underwriters of the Notes on the Closing Date is not consummated because of any refusal,
inability or failure on the part of the Company to perform any agreement herein or to comply with
any provision hereof, the Company agrees to reimburse the Representatives and the other
Underwriters (or such Underwriters as have terminated this Agreement with respect to themselves),
severally, upon demand for all out-of-pocket expenses that shall have been reasonably incurred by
the Representatives and the Underwriters in connection with the proposed purchase and the offering
and sale of the Notes, including but not limited to fees and disbursements of counsel, printing
expenses, travel expenses, postage, facsimile and telephone charges.
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8. Indemnification.
(a) Indemnification of the Underwriters. The Company and each of the Notes Guarantors agrees,
jointly and severally, to indemnify and hold harmless each Underwriter, its directors, officers,
employees and agents, and each person, if any, who controls any Underwriter within the meaning of
the Securities Act and the Exchange Act against any loss, claim, damage, liability or expense, as
incurred, to which such Underwriter or such controlling person may become subject, insofar as such
loss, claim, damage, liability or expense (or actions in respect thereof as contemplated below)
arises out of or is based (i) upon any untrue statement or alleged untrue statement of a material
fact contained in the Registration Statement, or any amendment thereto, including any information
deemed to be a part thereof pursuant to Rule 430B or 430C under the Securities Act, or the omission
or alleged omission therefrom of a material fact required to be stated therein or necessary to make
the statements therein not misleading; or (ii) upon any untrue statement or alleged untrue
statement of a material fact contained in any Issuer Free Writing Prospectus, any preliminary
prospectus or the Prospectus (or any amendment or supplement thereto), or the omission or alleged
omission therefrom of a material fact, in each case, necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not misleading, and to
reimburse each Underwriter, its officers, directors, employees, agents and each such controlling
person for any and all expenses (including the fees and disbursements of counsel chosen by Banc of
America Securities LLC) as such expenses are reasonably incurred by such Underwriter, or its
officers, directors, employees and agents or such controlling person in connection with
investigating, defending, settling, compromising or paying any such loss, claim, damage, liability,
expense or action; provided, however, that the foregoing indemnity agreement shall not apply to any
loss, claim, damage, liability or expense to the extent, but only to the extent, arising out of or
based upon any untrue statement or alleged untrue statement or omission or alleged omission made in
reliance upon and in conformity with written information furnished to the Company by the
Representatives expressly for use in the Registration Statement, any Issuer Free Writing
Prospectus, any preliminary prospectus or the Prospectus (or any amendment or supplement thereto).
The indemnity agreement set forth in this Section 8(a) shall be in addition to any liabilities that
the Company may otherwise have.
(b) Indemnification of the Company, its Directors and Officers. Each Underwriter agrees,
severally and not jointly, to indemnify and hold harmless the Company and the Notes Guarantors,
each of their directors, each of their officers who signed the Registration Statement and each
person, if any, who controls the Company or any of the Notes Guarantors within the meaning of the
Securities Act or the Exchange Act, against any loss, claim, damage, liability or expense, as
incurred, to which the Company, any Notes Guarantor, or any such director, officer or controlling
person may become subject, insofar as such loss, claim, damage, liability or expense (or actions in
respect thereof as contemplated below) arises out of or is based upon any untrue or alleged untrue
statement of a material fact contained in the Registration Statement, any Issuer Free Writing
Prospectus, any preliminary prospectus or the Prospectus (or any amendment or supplement thereto),
or arises out of or is based upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not misleading, in each
case to the extent, and only to the extent, that such untrue statement or alleged untrue statement
or omission or alleged omission was made in the Registration Statement, any Issuer Free Writing
Prospectus, any preliminary prospectus or the Prospectus (or any amendment or supplement thereto),
in reliance upon and in conformity with
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written information furnished to the Company by such Underwriter directly or through the
Representatives expressly for use therein; and to reimburse the Company, any Notes Guarantor or any
such director, officer or controlling person for any legal and other expense reasonably incurred by
the Company, or any such director, officer or controlling person in connection with investigating,
defending, settling, compromising or paying any such loss, claim, damage, liability, expense or
action. The Company and the Notes Guarantors hereby acknowledge that the only information that the
Underwriters have furnished to the Company and the Notes Guarantors expressly for use in the
Registration Statement, any Issuer Free Writing Prospectus, any preliminary prospectus or the
Prospectus (or any amendment or supplement thereto) consists of the statements set forth in the
table in the first paragraph and the statements set forth in the third paragraph, tenth paragraph,
eleventh paragraph, and the third and fourth sentences of the twelfth paragraph, each under the
caption “Underwriting” in the Prospectus. The indemnity agreement set forth in this Section 8(b)
shall be in addition to any liabilities that each Underwriter may otherwise have.
(c) Notifications and Other Indemnification Procedures. 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 an indemnifying party
under this Section 8, notify the indemnifying party in writing of the commencement thereof; but the
failure to so 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 substantive rights and defenses and
(ii) will not, in any event, relieve the indemnifying party from any obligations to any indemnified
party other than the indemnification obligation provided in paragraph (a) or (b) above. In case
any such action is brought against any indemnified party and such indemnified party seeks or
intends to seek indemnity from an indemnifying party, the indemnifying party will be entitled to
participate in, and, to the extent that it shall elect, jointly with all other indemnifying parties
similarly notified, by written notice delivered to the indemnified party promptly after receiving
the aforesaid notice from such indemnified party, to assume the defense thereof with counsel
satisfactory to such indemnified party; provided, however, if the defendants in any such action
include both the indemnified party and the indemnifying party and the indemnified party shall have
reasonably concluded that a conflict may arise between the positions of the indemnifying party and
the indemnified party in conducting the defense of any such action or that there may be legal
defenses available to it and/or other indemnified parties that are different from or additional to
those available to the indemnifying party, the indemnified party or parties shall have the right to
select separate counsel to assume such legal defenses and to otherwise participate in the defense
of such action on behalf of such indemnified party or parties. Upon receipt of notice from the
indemnifying party to such indemnified party of such indemnifying party’s election so to assume the
defense of such action and approval by the indemnified party of counsel, the indemnifying party
will not be liable to such indemnified party under this Section 8 for any legal or other expenses
subsequently incurred by such indemnified party in connection with the defense thereof unless (A)
the indemnified party shall have employed separate counsel in accordance with the proviso to the
preceding sentence (it being understood, however, that the indemnifying party shall not be liable
for the expenses of more than one separate counsel (other than local counsel), reasonably approved
by the indemnifying party (or by Banc of America Securities LLC in the case of Section 8(b)),
representing the indemnified parties who are parties to such action) or (B) the
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indemnifying party shall not have employed counsel satisfactory to the indemnified party to
represent the indemnified party within a reasonable time after notice of commencement of the
action, in each of which cases the fees and expenses of counsel shall be at the expense of the
indemnifying party.
(d) Settlements. The indemnifying party under this Section 8 shall not be liable for any
settlement of any proceeding effected without its written consent, which shall not be withheld
unreasonably, 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 against any loss, claim, damage,
liability or expense 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 Section 8(c)
hereof, 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, compromise or consent to the entry of judgment in any pending or
threatened action, suit or proceeding in respect of which any indemnified party is or could have
been a party and indemnity was or could have been sought hereunder by such indemnified party,
unless such settlement, compromise or consent (i) includes an unconditional release of such
indemnified party from all liability on claims that are the subject matter of such action, suit or
proceeding and (ii) does not include a statement as to or an admission of fault, culpability or a
failure to act, by or on behalf of any indemnified party.
(e) Indemnification of the QIU. Without limitation and in addition to its obligation under
the other subsections of this Section 8, the Company agrees to indemnify and hold harmless the QIU,
its officers and employees and each person, if any, who controls the QIU within the meaning of the
Securities Act or the Exchange Act from and against any loss, claim, damage, liabilities or
expense, as incurred, arising out of or based upon the QIU’s acting as a “qualified independent
underwriter” (within the meaning of NASD Rule 2720) in connection with the offering contemplated by
this Agreement, and agrees to reimburse each such indemnified person for any legal or other expense
reasonably incurred by them in connection with investigating, defending, settling, compromising or
paying any such loss, claim, damage, liability, expense or action; provided, however, that the
Company shall not be liable in any such case to the extent that any such loss, claim, damage,
liability or expense results from the gross negligence or willful misconduct of the QIU.
9. Contribution.
(a) If the indemnification provided for in Section 8 is for any reason unavailable to or
otherwise insufficient to hold harmless an indemnified party in respect of any losses, claims,
damages, liabilities or expenses referred to therein, then each indemnifying party shall contribute
to the aggregate amount paid or payable by such indemnified party, as incurred, as a result of any
losses, claims, damages, liabilities or expenses referred to therein (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company and the Notes Guarantors, on
the one hand, and the Underwriters, on the other hand, from the offering of
-21-
the Securities pursuant to this Agreement or (ii) if the allocation provided by clause (i)
above is not permitted by applicable law, in such proportion as is appropriate to reflect not only
the relative benefits referred to in clause (i) above but also the relative fault of the Company
and the Notes Guarantors, on the one hand, and the Underwriters, on the other hand, in connection
with the statements or omissions or inaccuracies in the representations and warranties herein which
resulted in such losses, claims, damages, liabilities or expenses, as well as any other relevant
equitable considerations. The relative benefits received by the Company and the Notes Guarantors,
on the one hand, and the Underwriters, on the other hand, in connection with the offering of the
Securities pursuant to this Agreement shall be deemed to be in the same respective proportions as
the total net proceeds from the offering of the Securities pursuant to this Agreement (before
deducting expenses) received by the Company and the Notes Guarantors, and the total underwriting
discount received by the Underwriters, in each case as set forth on the front cover page of the
Prospectus bear to the aggregate initial public offering price of the Securities as set forth on
such cover. The relative fault of the Company and the Notes Guarantors, on the one hand, and the
Underwriters, on the other hand, shall be determined by reference to, among other things, whether
any such untrue or alleged untrue statement of a material fact or omission or alleged omission to
state a material fact or any such inaccurate or alleged inaccurate representation or warranty
relates to information supplied by the Company and the Notes Guarantors, on the one hand, or the
Underwriters, on the other hand, and the parties’ relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission.
The amount paid or payable by a party as a result of the losses, claims, damages, liabilities and
expenses referred to above shall be deemed to include, subject to the limitations set forth in
Section 8(c), any legal or other fees or expenses reasonably incurred by such party in connection
with investigating or defending any action or claim.
The Company and the Underwriters agree that it would not be just and equitable if contribution
pursuant to this Section 9 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 which does not take
account of the equitable considerations referred to in this Section 9.
Notwithstanding the provisions of this Section 9, no Underwriter shall be required to contribute
any amount in excess of the underwriting commissions received by such Underwriter in connection
with the Securities underwritten by it and distributed to the public. 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 Underwriters’ obligations to contribute pursuant to this Section 9 are several, and not joint,
in proportion to their respective underwriting commitments as set forth opposite their names in
Schedule A. For purposes of this Section 9, each director, officer, employee and agent of an
Underwriter and each person, if any, who controls an Underwriter within the meaning of the
Securities Act and the Exchange Act shall have the same rights to contribution as such Underwriter,
and each director of the Company and the Notes Guarantors, each officer of the Company and the
Notes Guarantors who signed the Registration Statement and each person, if any, who controls the
Company and the Notes Guarantors within the meaning of the Securities Act and the Exchange Act
shall have the same rights to contribution as the Company and the Notes Guarantors.
-22-
10. Default of One or More of the Several Underwriters. If, on the Closing Date, any
one or more of the several Underwriters shall fail or refuse to purchase Securities that it or they
have agreed to purchase hereunder on such date, and the aggregate principal amount of Securities
which such defaulting Underwriter or Underwriters agreed but failed or refused to purchase does not
exceed 10% of the aggregate principal amount of the Securities to be purchased on such date, the
other Underwriters shall be obligated, severally, in the proportions that the principal amount of
Securities to be purchased set forth opposite their respective names on Schedule A bears to the
aggregate principal amount of Securities set forth opposite the names of all such non-defaulting
Underwriters, or in such other proportions as may be specified by the Representatives with the
consent of the non-defaulting Underwriters, to purchase the Securities which such defaulting
Underwriter or Underwriters agreed but failed or refused to purchase on such date. If, on the
Closing Date, any one or more of the Underwriters shall fail or refuse to purchase Securities and
the principal amount of Securities with respect to which such default occurs exceeds 10% of the
principal amount of Securities to be purchased on such date, and arrangements satisfactory to the
Representatives and the Company for the purchase of such Securities are not made within 48 hours
after such default, this Agreement shall terminate without liability of any party to any other
party except that the provisions of Section 5 and Section 9 shall at all times be effective and
shall survive such termination. In any such case either the Representatives or the Company shall
have the right to postpone the Closing Date, but in no event for longer than seven days in order
that the required changes, if any, to the Registration Statement and the Prospectus or any other
documents or arrangements may be effected. As used in this Agreement, the term “Underwriter” shall
be deemed to include any person substituted for a defaulting Underwriter under this Section 10.
Any action taken under this Section 10 shall not relieve any defaulting Underwriter from liability
in respect of any default of such Underwriter under this Agreement.
11. Termination of this Agreement. Prior to the Closing Date this Agreement may be
terminated by the Representatives by notice given to the Company if at any time (i)(A) trading or
quotation in any of the Company’s securities shall have been suspended or limited by the Commission
or by the New York Stock Exchange, or (B) trading in securities generally on the New York Stock
Exchange or the Nasdaq Stock Market, Inc. shall have been suspended or limited, or minimum or
maximum prices shall have been generally established on any of such stock exchanges by the
Commission or FINRA; (ii) a general banking moratorium shall have been declared by federal or New
York authorities or a material disruption in commercial banking or securities settlement or
clearance services in the United States has occurred; (iii) in the judgment of the Representatives
there shall have occurred any Material Adverse Change; or (iv) there shall have occurred any
outbreak or escalation of national or international hostilities or any crisis or calamity, or any
change in the United States or international financial markets, or any substantial change or
development involving a prospective substantial change in United States’ or international
political, financial or economic conditions, as in the judgment of the Representatives is material
and adverse and makes it impracticable or inadvisable to market the Securities in the manner and on
the terms described in the Prospectus or to enforce contracts for the sale of securities. Any
termination pursuant to this Section 11 shall be without liability on the part of (a) the Company
to any Underwriter, except that if termination is pursuant to clause (i)(A) or (iii) of the
preceding sentence the Company shall be obligated to reimburse the expenses of the Representatives
and the Underwriters pursuant to Sections 5 and 7 hereof or (b) any Underwriter to the Company.
-23-
12. No Advisory or Fiduciary Responsibility.
(a) The Company and each Notes Guarantor acknowledge and agree that: (i) the purchase and sale
of the Securities pursuant to this Agreement, including the determination of the public offering
price of the Securities and any related discounts and commissions, is an arm’s-length commercial
transaction between the Company and each Notes Guarantor, on the one hand, and the several
Underwriters, on the other hand, and the Company and each Notes Guarantor is capable of evaluating
and understanding and understands and accepts the terms, risks and conditions of the transactions
contemplated by this Agreement; (ii) in connection with each transaction contemplated hereby and
the process leading to such transaction each Underwriter is and has been acting solely as a
principal and is not the financial advisor, agent or fiduciary of the Company, the Notes Guarantors
or any of their respective affiliates, stockholders, creditors or employees or any other party;
(iii) no Underwriter has assumed or will assume an advisory, agency or fiduciary responsibility in
favor of the Company or any Notes Guarantor with respect to any of the transactions contemplated
hereby or the process leading thereto (irrespective of whether such Underwriter has advised or is
currently advising the Company or any Notes Guarantor on other matters) and no Underwriter has any
obligation to the Company or any Notes Guarantor with respect to the offering contemplated hereby
except the obligations expressly set forth in this Agreement; (iv) the several Underwriters and
their respective affiliates may be engaged in a broad range of transactions that involve interests
that differ from those of the Company and the Notes Guarantors and that the several Underwriters
have no obligation to disclose any of such interests by virtue of any advisory, agency or fiduciary
relationship; and (v) the Underwriters have not provided any legal, accounting, regulatory or tax
advice with respect to the offering contemplated hereby and the Company and the Notes Guarantors
have consulted their own legal, accounting, regulatory and tax advisors to the extent they deemed
appropriate.
This Agreement supersedes all prior agreements and understandings (whether written or oral)
between the Company, the Notes Guarantors and the several Underwriters, or any of them, with
respect to the subject matter hereof. The Company and each Notes Guarantor hereby waives and
releases, to the fullest extent permitted by law, any claims that the Company or any Notes
Guarantor may have against the several Underwriters with respect to any breach or alleged breach of
agency or fiduciary duty.
13. Representations and Indemnities to Survive Delivery. The respective indemnities,
agreements, representations, warranties and other statements of the Company, of its officers and of
the several Underwriters set forth in or made pursuant to this Agreement will remain in full force
and effect, regardless of any (a) investigation, or statement as to the results thereof, made by or
on behalf of any Underwriter, the QIU, the officers or employees of any Underwriter or the QIU, or
any person controlling the Underwriter or the QIU or (b) acceptance of the Securities and payment
for them hereunder. The provisions of Sections 7, 8 and 13 hereof shall survive the termination or
cancellation of this Agreement.
14. Notices. All communications hereunder shall be in writing and shall be mailed,
hand delivered or telecopied and confirmed to the parties hereto as follows:
-24-
If to the Representatives:
Banc of America Securities LLC
0 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Facsimile: (000) 000-0000
Attention: Legal Department
0 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Facsimile: (000) 000-0000
Attention: Legal Department
With a copy to (which copy shall not constitute notice):
Xxxxx Xxxxx L.L.P.
0000 Xxxx Xxxxxx
Xxxxx 000
Xxxxxx, XX 00000
Facsimile: (000) 000-0000
Attention: Xxxx Xxxxxxx
0000 Xxxx Xxxxxx
Xxxxx 000
Xxxxxx, XX 00000
Facsimile: (000) 000-0000
Attention: Xxxx Xxxxxxx
If to the Company:
Xxxxxxxx Resources, Inc.
0000 Xxxx xxx Xxxxxxx Xxxx.
Xxxxx 000
Xxxxxx, XX 00000
Facsimile: (000) 000-0000
Attention: Xxxxxx X. Xxxxx, Senior Vice President
0000 Xxxx xxx Xxxxxxx Xxxx.
Xxxxx 000
Xxxxxx, XX 00000
Facsimile: (000) 000-0000
Attention: Xxxxxx X. Xxxxx, Senior Vice President
With a copy to (which copy shall not constitute notice):
Xxxxx Lord Bissell & Liddell LLP
0000 Xxxx Xxxxxx
Xxxxx 0000
Xxxxxx, XX 00000
Facsimile: (000) 000-0000
Attention: Xxxx Xxxxxxxx
0000 Xxxx Xxxxxx
Xxxxx 0000
Xxxxxx, XX 00000
Facsimile: (000) 000-0000
Attention: Xxxx Xxxxxxxx
Any party hereto may change the address for receipt of communications by giving written notice
to the others.
15. Successors and Assigns. This Agreement will inure to the benefit of and be
binding upon the parties hereto, including any substitute Underwriters pursuant to Section 9
hereof, and to the benefit of (i) the Company and the Notes Guarantors, their directors, any person
who controls the Company or any of the Notes Guarantors within the meaning of the Securities Act
and the Exchange Act and any officer of the Company who signs the Registration Statement, (ii) the
Underwriters, the officers, directors, employees and agents of the Underwriters, and each person,
if any, who controls any Underwriter within the meaning of the Securities Act and the Exchange Act,
(iii) the QIU, the QIU’s officers, directors, employees and agents, and each person, if any, who
controls the QIU within the meaning of the Securities Act and the Exchange Act, and (iv) the
respective successors and assigns of any of the above, all as
-25-
and to the extent provided in this Agreement, and no other person shall acquire or have any
right under or by virtue of this Agreement. The term “successors and assigns” shall not include a
purchaser of any of the Securities from any of the several Underwriters merely because of such
purchase.
16. Partial Unenforceability. The invalidity or unenforceability of any Section,
paragraph or provision of this Agreement shall not affect the validity or enforceability of any
other Section, paragraph or provision hereof. If any Section, paragraph or provision of this
Agreement is for any reason determined to be invalid or unenforceable, there shall be deemed to be
made such minor changes (and only such minor changes) as are necessary to make it valid and
enforceable.
17. Governing Law Provisions. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK.
(a) Consent to Jurisdiction. Any legal suit, action or proceeding arising out of or based upon
this Agreement or the transactions contemplated hereby (“Related Proceedings”) may be instituted in
the federal courts of the United States of America located in the City and County of New York or
the courts of the State of New York in each case located in the City and County of New York
(collectively, the “Specified Courts”), and each party irrevocably submits to the exclusive
jurisdiction (except for suits, actions, or proceedings instituted in regard to the enforcement of
a judgment of any Specified Court in a Related Proceeding, as to which such jurisdiction is
non-exclusive) of the Specified Courts in any Related Proceeding. Service of any process, summons,
notice or document by mail to such party’s address set forth above shall be effective service of
process for any Related Proceeding brought in any Specified Court. The parties irrevocably and
unconditionally waive any objection to the laying of venue of any Related Proceeding in the
Specified Courts and irrevocably and unconditionally waive and agree not to plead or claim in any
Specified Court that any Related Proceeding brought in any Specified Court has been brought in an
inconvenient forum.
(b) Waiver of Immunity. With respect to any Related Proceeding, each party irrevocably
waives, to the fullest extent permitted by applicable law, all immunity (whether on the basis of
sovereignty or otherwise) from jurisdiction, service of process, attachment (both before and after
judgment) and execution to which it might otherwise be entitled in the Specified Courts, and with
respect to any Related Judgment, each party waives any such immunity in the Specified Courts or any
other court of competent jurisdiction, and will not raise or claim or cause to be pleaded any such
immunity at or in respect of any such Related Proceeding or Related Judgment, including, without
limitation, any immunity pursuant to the United States Foreign Sovereign Immunities Act of 1976, as
amended.
18. General Provisions. This Agreement constitutes the entire agreement of the
parties to this Agreement and supersedes all prior written or oral and all contemporaneous oral
agreements, understandings and negotiations with respect to the subject matter hereof. This
Agreement may be executed in two or more counterparts, each one of which shall be an original, with
the same effect as if the signatures thereto and hereto were upon the same instrument. This
Agreement may not be amended or modified unless in writing by all of the parties hereto, and no
-26-
condition herein (express or implied) may be waived unless waived in writing by each party
whom the condition is meant to benefit. The Section headings herein are for the convenience of the
parties only and shall not affect the construction or interpretation of this Agreement.
Each of the parties hereto acknowledges that it is a sophisticated business person who was
adequately represented by counsel during negotiations regarding the provisions hereof, including,
without limitation, the indemnification provisions of Section 8 and the contribution provisions of
Section 9, and is fully informed regarding said provisions. Each of the parties hereto further
acknowledges that the provisions of Sections 8 and 9 hereto fairly allocate the risks in light of
the ability of the parties to investigate the Company, its affairs and its business in order to
assure that adequate disclosure has been made in the Registration Statement, any preliminary
prospectus, the Prospectus and any Issuer Free Writing Prospectus (and any amendments and
supplements thereto), as required by the Securities Act and the Exchange Act.
[Signature Page Follows.]
-27-
If the foregoing is in accordance with your understanding of our agreement, kindly sign and
return to the Company the enclosed copies hereof, whereupon this instrument, along with all
counterparts hereof, shall become a binding agreement in accordance with its terms.
| Very truly yours, XXXXXXXX RESOURCES, INC. |
||||
| By: | /s/ M. XXX XXXXXXX | |||
| Name: | ||||
| Title: | ||||
| NOTES GUARANTORS XXXXXXXX OIL & GAS, LP By: Xxxxxxxx Oil & Gas GP, LLC |
||||
| By: | /s/ M. XXX XXXXXXX | |||
| Name: | ||||
| Title: | ||||
| XXXXXXXX OIL & GAS GP, LLC |
||||
| By: | /s/ M. XXX XXXXXXX | |||
| Name: | ||||
| Title: | ||||
| XXXXXXXX OIL & GAS – LOUISIANA, LLC |
||||
| By: | /s/ M. XXX XXXXXXX | |||
| Name: | ||||
| Title: | ||||
[Signature
Page to Underwriting Agreement]
| XXXXXXXX OIL & GAS INVESTMENTS, LLC |
||||
| By: | /s/ M. XXX XXXXXXX | |||
| Name: | ||||
| Title: | ||||
| XXXXXXXX OIL & GAS HOLDINGS, INC. |
||||
| By: | /s/ M. XXX XXXXXXX | |||
| Name: | ||||
| Title: | ||||
[Signature Page to Underwriting Agreement]
The foregoing Agreement is hereby confirmed and accepted by the Representatives as of the date
first above written.
| BANC OF AMERICA SECURITIES LLC Acting as Representatives of the several Underwriters named in the attached Schedule A. |
||||
By:
|
Banc of America Securities LLC | |||
By: |
/s/ XXX XXXXXXXX | |||
[Signature Page to Underwriting Agreement]
SCHEDULE A
| Principal | ||||
| Amount of | ||||
| Securities | ||||
| to be | ||||
| Underwriters | Purchased | |||
Banc of America Securities LLC |
$ | 127,500,000 | ||
BMO Capital Markets Corp. |
$ | 52,500,000 | ||
X.X. Xxxxxx Securities Inc. |
$ | 30,000,000 | ||
Scotia Capital (USA) Inc. |
$ | 9,000,000 | ||
Mitsubishi UFJ Securities (USA), Inc. |
$ | 9,000,000 | ||
Natixis Bleichroeder Inc. |
$ | 9,000,000 | ||
U.S. Bancorp Investments, Inc. |
$ | 9,000,000 | ||
Capital One Southcoast, Inc. |
$ | 9,000,000 | ||
KeyBanc Capital Markets Inc. |
$ | 9,000,000 | ||
Xxxxxx Xxxxxx & Company, Inc. |
$ | 9,000,000 | ||
SunTrust Xxxxxxxx Xxxxxxxx, Inc. |
$ | 9,000,000 | ||
BBVA Securities Inc. |
$ | 9,000,000 | ||
Comerica Securities, Inc. |
$ | 9,000,000 | ||
Total |
$ | 300,000,000 | ||
Sched. A-1
SCHEDULE B
Notes Guarantors
1. Xxxxxxxx Oil & Gas, LP, a Nevada limited partnership
2. Xxxxxxxx Oil & Gas GP, LLC, a Nevada limited liability company
3. Xxxxxxxx Oil & Gas-Louisiana, LLC, a Nevada limited liability company
4. Xxxxxxxx Oil & Gas Investments, LLC, a Nevada limited liability company
5. Xxxxxxxx Oil & Gas Holdings, Inc., a Nevada corporation
Sched. B-1
SCHEDULE C
Issuer Free Writing Prospectuses
Schedule of Free Writing Prospectuses included in the Disclosure Package
Final Term Sheet
Sched. C-1
SCHEDULE D
Final Term Sheet
|
Filed pursuant to Rule 433 under the Securities Act Registration Statement No. 333-162328 October 6, 0000 |
|
Xxxxxxxx Resources, Inc. |
||
$300,000,000 |
||
83/8% Senior Notes due 2017 |
The following information supplements the preliminary prospectus supplement dated October 6,
2009 and supersedes such preliminary prospectus supplement to the extent that it is inconsistent
therewith. Financial information presented in the preliminary prospectus supplement is deemed to
have changed to the extent affected by the changes described herein.
| Term Sheet | ||
Issuer:
|
Xxxxxxxx Resources, Inc. (“CRK”) | |
Principal Amount:
|
$300,000,000 | |
Title of Securities:
|
83/8% Senior Notes due 2017 | |
Maturity:
|
October 15, 2017 | |
Offering Price:
|
98.571% | |
Coupon:
|
8.375% | |
Yield-to-Maturity:
|
8.625% | |
Gross Proceeds to CRK:
|
$295,713,000 | |
Net Proceeds to CRK (before expenses):
|
$289,713,000 | |
Gross Spread (%):
|
2.0% | |
Interest Payment Dates:
|
April 15th and October 15th | |
Record Dates:
|
April 1st and October 1st | |
First Interest Payment Date:
|
April 15, 2010 |
| Optional Redemption: | On or after: | Price: | ||||
| October 15, 2013 | 104.188 | % | ||||
| October 15, 2014 | 102.094 | % | ||||
| October 15, 2015 | 100.000 | % | ||||
Equity Clawback:
|
Up to 35% at 108.375% plus accrued interest until October 15, 2012 | |
Change of Control:
|
Put at 101% of principal plus accrued interest, if any, to the date of purchase |
Sched. D-1
Joint Book Running Managers:
|
Banc of America Securities LLC | |
| BMO Capital Markets Corp. | ||
| X.X. Xxxxxx Securities Inc. | ||
Co-Managers:
|
BBVA Securities Inc. | |
| Capital One Southcoast, Inc. | ||
| Comerica Securities, Inc. | ||
| KeyBanc Capital Markets Inc. | ||
| Mitsubishi UFJ Securities (USA), Inc. | ||
| Xxxxxx Xxxxxx & Company, Inc. | ||
| Natixis Bleichroeder, Inc. | ||
| Scotia Capital (USA) Inc. | ||
| SunTrust Xxxxxxxx Xxxxxxxx, Inc. | ||
| U.S. Bancorp Investments, Inc. | ||
Trade Date:
|
October 6, 2009 | |
Settlement Date:
|
October 9, 2009 (T+3) | |
Distribution:
|
Registered Offering | |
Use of Proceeds:
|
Xxxxxxxx Resources, Inc. will use the net proceeds of this offering to repay borrowings under its bank credit facility and for general corporate purposes. | |
CUSIP Number:
|
205768 AG9 | |
ISIN Number:
|
US205768AG90 |
Other Information
As of September 30, 2009, after giving effect to this offering and the application of the net
proceeds therefrom as set forth under “Use of Proceeds” above, we and the subsidiary guarantors
would have had approximately $475.0 million in principal amount of senior indebtedness outstanding,
none of which would be secured, and we would have had approximately $550.0 million in borrowing
capacity under our bank credit facility, which, if borrowed, would be secured debt effectively
senior to the notes to the extent of the value of the collateral securing that indebtedness.
Because more than 5% of the net proceeds of this offering will be received by certain of the
underwriters or their affiliates that are lenders under our bank credit facility, this offering is
being conducted in compliance with NASD Rule 2720(c). SunTrust Xxxxxxxx Xxxxxxxx, Inc.
(“SunTrust”) has agreed to act as the qualified independent underwriter with respect to this
offering and has performed due diligence investigations and participated in the preparation of the
prospectus supplement. We have agreed to indemnify SunTrust in its capacity as qualified
independent underwriter against certain liabilities, including liabilities under the Securities Act
of 1933.
The issuer has filed a registration statement (including a prospectus) with the SEC for the
offering to which this communication relates. Before you invest, you should read the prospectus in
that registration statement and other documents the issuer has filed with the SEC for more complete
information about the issuer and this offering. You may get these documents for free by visiting
XXXXX on the SEC web site at xxx.xxx.xxx. Alternatively, the issuer, any underwriter or any dealer
participating in the offering will arrange to send you the prospectus if you request it by calling
Banc of America Securities LLC toll free at 1-800-294-1322.
ANY DISCLAIMERS OR OTHER NOTICES THAT MAY APPEAR BELOW ARE NOT APPLICABLE TO THIS COMMUNICATION AND
SHOULD BE DISREGARDED. SUCH DISCLAIMERS OR OTHER NOTICES WERE AUTOMATICALLY GENERATED AS A RESULT
OF THIS COMMUNICATION BEING SENT VIA BLOOMBERG OR ANOTHER EMAIL SYSTEM.
Sched. D-2
Exhibit A
Form of Opinion of Counsel for the Company
Opinion of counsel for the Company to be delivered pursuant to Section 6(d) of the
Underwriting Agreement.
A. 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 Disclosure Package
and 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.
B. Each Notes Guarantor has been duly incorporated, is validly existing as a corporation,
limited partnership or limited liability company, as the case may be, in good standing under the
laws of the jurisdiction of its organization, has the corporate or partnership power and authority
to own its property and to conduct its business as described in the Disclosure Package and 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; all
of the issued shares of capital stock or other ownership interest of each of the Notes Guarantors
have been duly and validly authorized and issued, are fully paid and non-assessable, and are owned
by the Company directly, or indirectly through one of the other subsidiaries of the Company, to the
best knowledge of such counsel free and clear of all liens, encumbrances, equities or claims,
except for pledges of such shares or ownership interest pursuant to the Company’s bank credit
facility described in the Prospectus.
C. The Underwriting Agreement has been duly authorized, executed and delivered by the Company
and each of the Notes Guarantors.
D. The authorized capital stock of the Company is as set forth under the caption
“Capitalization” in the Prospectus and all outstanding shares of capital stock of the Company have
been duly authorized and validly issued, and are fully paid and nonassessable.
E. The Notes have been duly authorized by the Company 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, will be valid and binding obligations
of the Company, enforceable in accordance with their terms, subject to applicable bankruptcy,
insolvency or similar laws affecting creditors’ rights generally and general principles of equity,
and will be entitled to the benefits of the Indenture.
Exhibit A-1
F. The Guarantees have been duly authorized by the Notes Guarantors and, when the Securities
are 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, will
be valid and binding obligations of the Notes Guarantors, enforceable in accordance with their
terms, subject to applicable bankruptcy, insolvency or similar laws affecting creditors’ rights
generally and general principles of equity, and will be entitled to the benefits of the Indenture.
G. The Indenture has been duly authorized, executed and delivered by, and is a valid and
binding agreement of, the Company and each of the Notes Guarantors, enforceable in accordance with
its terms, subject to applicable bankruptcy, insolvency or similar laws affecting creditors’ rights
generally and general principles of equity.
H. The execution and delivery by the Company and the Notes Guarantors of, and the performance
by the Company and the Notes Guarantors of their obligations under, the Underwriting Agreement, the
Indenture, the Notes and the Guarantees will not contravene any provision of applicable law or the
certificate of incorporation or by-laws, or other organizational documents, of the Company or the
Notes Guarantors 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 of its
subsidiaries, and no consent, approval, authorization or order of, or qualification with, any
governmental body or agency is required for the performance by the Company or the Notes Guarantors
of their obligations under the Underwriting Agreement, the Indenture, the Notes, or the Guarantees
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 Securities.
I. 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 Disclosure
Package 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 Disclosure Package or the Prospectus or to
be filed as exhibits to the Registration Statement that are not described or filed as required.
J. To the best of such counsel’s knowledge, neither the Company nor any of its subsidiaries is
in violation of its respective certificate of incorporation or by-laws, or other organizational
documents.
K. To the best knowledge of such counsel, neither the Company nor any of its subsidiaries is
in violation of any judgment, order or decree of any governmental body, agency or court having
jurisdiction over the Company or any of its subsidiaries except for such violations which in the
aggregate would not have a material adverse effect on the Company and its subsidiaries, taken as a
whole.
Exhibit A-2
L. 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 Prospectus, will not be an “investment
company” as such term is defined in the Investment Company Act of 1940, as amended.
M. The statements included in the Company’s Annual Report on Form 10-K for the year ended
December 31, 2008 under the captions “Business – Regulation” and “Business – Environmental
Regulation” and in the Prospectus under the captions “Description of Other Indebtedness,”
“Description of the Notes” and “Risk Factors – Risks Related to Our Business – We are subject to
extensive governmental laws and regulations that may adversely affect the cost, manner or
feasibility of doing business” insofar as such statements constitute summaries of the legal
matters, documents or proceedings referred to therein, fairly summarize the matters referred to
therein.
N. The statements in the Prospectus under the caption “Certain United States Federal Income
Tax Considerations,” insofar as such statements constitute a summary of the United States federal
tax laws referred to therein, are accurate and fairly summarize in all material respects the United
States federal tax laws referred to therein.
O. The Registration Statement was automatically effective upon filing under the Securities
Act. Any required filing of the Prospectus pursuant to Rule 424(b) has been made in the manner and
within the time period required by Rule 424(b). To the best knowledge of such counsel, (i) no stop
order suspending the effectiveness of the Registration Statement has been issued under the
Securities Act and (ii) no proceedings for that purpose have been initiated or are pending or
threatened by the Commission.
P. The Indenture has been duly qualified under the 1939 Act.
Q. The Registration Statement and the Prospectus and each amendment or supplement to the
Registration Statement and the Prospectus, (except for financial statements and schedules, pro
forma and other financial and statistical data included therein and the Trustee’s Statement of
Eligibility on Form T-1, as to which such counsel need not express any opinion), appear on their
face to comply as to form in all material respects with the requirements of the Securities Act and
the Securities Act Regulations.
R. Each document incorporated by reference in the Registration Statement and the Prospectus
(except for financial statements and schedules, pro forma and other financial and statistical data
included therein as to which such counsel need not express any opinion), appear on their face to
have complied as to form when filed with the Commission in all material respects with the Exchange
Act and the Exchange Act Regulations.
In addition, such counsel shall state that they have participated in conferences with officers
and other representatives of the Company, representatives of the independent public or certified
public accountants for the Company and representatives of the Underwriters at which the contents of
the Registration Statement, the Disclosure Package, the Prospectus, and any supplements or
amendments thereto, and related matters were discussed and, although such
Exhibit A-3
counsel is not passing upon and does not assume any responsibility for the accuracy,
completeness or fairness of the statements contained in the Registration Statement, the Prospectus
or any documents that constitute part of the Disclosure Package including the documents
incorporated by reference therein (other than as specified above), and any supplements or
amendments thereto, on the basis of the foregoing, nothing has come to their attention which would
lead them to believe that (i) either the Registration Statement or any amendments thereto, at the
time the Registration Statement or such amendments became effective, contained an untrue statement
of a material fact or omitted to state a material fact required to be stated therein or necessary
in order to make the statements therein not misleading; (ii) the Prospectus, as of its date or at
the Closing Date contained an untrue statement of a material fact or omitted 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; or (iii) the Disclosure Package, as of the Applicable Time,
contained any untrue statement of a material fact or omitted to state any material fact necessary
in order to make the statements therein, in the light of circumstances under which they were made,
not misleading (it being understood that such counsel need express no belief as to the financial
statements and the notes thereto, the schedules and pro formas and other financial data derived
therefrom, the Trustee’s Statement of Eligibility on Form T-1 and reports included or incorporated
by reference in the Registration Statement, the Prospectus, the Disclosure Package or any
amendments or supplements thereto).
Exhibit A-4
