Exhibit 1(d)
CONSTELLATION ENERGY GROUP, INC.
SHARES COMMON STOCK
(without par value)
FORM OF PURCHASE AGREEMENT
INCLUDING
STANDARD PURCHASE PROVISIONS
2
CONSTELLATION ENERGY GROUP, INC.
COMMON STOCK
FORM OF PURCHASE AGREEMENT
[Date]
Constellation Energy Group, Inc.
000 X. Xxxxx Xxxxxx,
Xxxxxxxxx, Xxxxxxxx 00000
Dear Sirs:
Referring to the captioned shares of Common Stock of Constellation Energy
Group, Inc. (the "Company") covered by the registration statement on Form S-3
(No. 333-), (such registration statement, including (i) the prospectus included
therein dated, as supplemented by a prospectus supplement dated _______________,
2003 related to the Purchased Stock referred to below in the form first filed
under Rule 424(b) (such prospectus as so supplemented, including each document
incorporated by reference therein is hereinafter called the "Prospectus") and
(ii) all documents filed as part thereof or incorporated by reference therein
together with any registration statement increasing the size of the offering (a
"Rule 462(b) Registration Statement") filed pursuant to Rule 462(b) under the
Securities Act of 1933 as amended are hereinafter called the "Registration
Statement", on the basis of the representations, warranties and agreements
contained in this Agreement, but subject to the terms and conditions herein set
forth, the purchaser or purchasers named in Schedule A hereto (the "Purchasers")
agree to purchase, severally, and the Company agrees to sell to the Purchasers,
severally, the respective number of shares of such Common Stock (the "Purchased
Stock") for the price described below set forth opposite the name of each
Purchaser on Schedule A hereto.
The price at which the Purchased Stock shall be purchased from the Company
by the Purchasers shall be $_____ per share. The Purchased Stock will be offered
by the Purchasers at the price as set forth in the Prospectus relating to such
Shares.
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The Closing Date for the sale of the Purchased Stock shall be [date].
4
The place to which the Purchased Stock may be checked, packaged and
delivered shall be:
or such other place as the Purchaser(s) shall designate.
Notices to the Purchaser(s) shall be sent to the following address(es)
or telecopier number(s):
If we are acting as Representative(s) for the several Purchasers named in
Schedule A hereto, we represent that we are authorized to act for such several
Purchasers in connection with the transactions contemplated in this Agreement,
and that, if there are more than one of us, any action under this Agreement
taken by any of us will be binding upon all the Purchasers.
All of the provisions contained in the document entitled "Constellation
Energy Group, Inc. Standard Purchase Provisions", dated ____________, a copy of
which has been previously furnished to us, are hereby incorporated by reference
in their entirety and shall be deemed to be a part of this Agreement to the same
extent as if such provisions had been set forth in full herein.
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If the foregoing is in accordance with your understanding of our agreement,
kindly sign and return to us the enclosed duplicate hereof, whereupon it will
become a binding agreement between the Company and the several Purchasers in
accordance with its terms.
Very truly yours,
[Name(s) of Purchaser(s)]
By
------------------------------
Name:
Title:
------------------------------
Acting on behalf of and as
Representative(s) of the
several Purchasers named in
Schedule A hereto.*
The foregoing Purchase
Agreement is hereby confirmed
as of the date first above
written
CONSTELLATION ENERGY GROUP, INC.
By
-------------------------------------------------
Title:
*To be deleted if the Purchase Agreement is not executed by one or more
Purchasers acting as Representative(s) of the Purchasers for purposes of this
Agreement.
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SCHEDULE A
Name of Purchaser Number of Shares
----------------- ----------------
Total
----------------
CONSTELLATION ENERGY GROUP, INC.
STANDARD PURCHASE PROVISIONS
[date]
From time to time, Constellation Energy Group, Inc., a Maryland
corporation (the "Company"), may enter into purchase agreements that provide for
the sale of designated securities to the purchaser or purchasers named therein.
The standard provisions set forth herein may be incorporated by reference in any
such purchase agreement ("Purchase Agreement"). The Purchase Agreement,
including the provisions incorporated therein by reference, is herein sometimes
referred to as "this Agreement." Unless otherwise defined herein, terms defined
in the Purchase Agreement are used herein as therein defined.
1. Introductory. The Company proposes to issue and sell from time to
time its Common Stock (without par value) ("Stock") registered under the
registration statement referred to in Section 2(a). The Stock sold by the
Company is hereinafter called the "Purchased Stock." The firm or firms, as the
case may be, which agree to purchase the same are hereinafter referred to as the
"Purchasers" of such Purchased Stock. The Purchased Stock will be sold to the
Purchasers for resale in accordance with the terms of the offering determined at
the time of the sale. The terms "you" and "your" refer to those Purchasers who
sign the Purchase Agreement either on behalf of themselves only or on behalf of
themselves and as representatives of the several Purchasers named in Schedule A
thereto, as the case may be.
2. Representations and Warranties of the Company. The Company
represents and warrants to and agrees with each Purchaser that:
(a) A registration statement on Form S-3 (No. 333-) covering $2
billion maximum aggregate offering price of securities of the Company (including
the Purchased Stock), including a prospectus has been filed with the Securities
and Exchange Commission ("Commission") and has become effective. The terms
Registration Statement and Prospectus shall have the meanings ascribed to them
in the Purchase Agreement.
(b) The Registration Statement conforms in all respects to the
requirements of the Securities Act of 1933, as amended ("Act"), and the
pertinent published rules and regulations of the Commission thereunder ("33 Act
Rules and Regulations"), and does not include any untrue statement of a material
fact or omit to state any material fact required to be stated therein or
necessary to make the statements therein not misleading, except that the
foregoing does not apply to statements or omissions in such document based upon
written information furnished to the Company by any Purchaser specifically for
use therein. The documents incorporated by reference in the Registration
Statement or the Prospectus pursuant to Item 12 of Form S-3 of the Act, at the
time they were filed with the Commission, complied in all
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material respects with the requirements of the Securities Exchange Act of 1934,
as amended ("Exchange Act"), and the pertinent published rules and regulations
thereunder ("Exchange Act Rules and Regulations"). Any additional documents
deemed to be incorporated by reference in the Prospectus will, when they are
filed with the Commission, comply in all material respects with the requirements
of the Exchange Act and the Exchange Act Rules and Regulations and will not
contain an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading.
3. Delivery and Payment for the Purchased Stock. The Company will
deliver the Purchased Stock to you for the accounts of the Purchasers, at the
offices of the Transfer Agent/Registrar (at the place specified in the Purchase
Agreement) against payment of the purchase price by wire transfer to an account
specified by the Company or by certified or official bank check or checks in
same day or New York or Baltimore Clearing House funds drawn to the order of the
Company, at the office of the Company, 000 X. Xxxxx Xxxxxx, 00xx Xxxxx,
Xxxxxxxxx, Xxxxxxxx, 00000 at the time agreed to pursuant to the second
paragraph of the Purchase Agreement or at such other time not later than seven
full business days thereafter as you and the Company determine, such time being
herein referred to as the "Closing Date." The Purchased Stock so to be delivered
will be in registered form registered in such names and amounts as you request
in writing not later than 3:00 p.m., New York Time, on the second full business
day prior to the Closing Date, or, if no such request is received, in the names
of the respective Purchasers in the amounts agreed to be purchased by them
pursuant to the Purchase Agreement. The Company shall make the Purchased Stock
available for checking and packaging at the offices of the Transfer
Agent/Registrar (at the place specified in the Purchase Agreement) prior to the
Closing Date and, unless prevented from doing so by circumstances beyond its
control, not later than 2:00 p.m., New York Time, on the business day next
preceding the Closing Date. If you request that any Purchased Stock be issued in
a name or names other than that of the Purchaser agreeing to purchase such
Purchased Stock hereunder, the Company shall not be obligated to pay any
transfer taxes resulting therefrom.
4. Offering by the Purchasers. The several Purchasers propose to
offer the Purchased Stock for sale to the public as set forth in the Prospectus.
5. Covenants of the Company. The Company covenants and agrees with
the several Purchasers that:
(a) It will promptly cause the Prospectus to be filed with the
Commission as required by Rule 424.
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(b) For as long as a prospectus relating to the Purchased Stock is
required to be delivered under the Act, if any event relating to or
affecting the Company or of which the Company shall be advised in writing
by the Purchasers shall occur which, in the Company's opinion, should be
set forth in a supplement or amendment to the Prospectus in order either to
make the Prospectus comply with the requirements of the Act or which would
require the making of any change in the Prospectus so that as thereafter
delivered to purchasers such Prospectus 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 light of the circumstances under
which they were made, not misleading, the Company will promptly amend or
supplement the Prospectus by either (i) preparing and filing with the
Commission supplement(s) or amendment(s) to the Prospectus, or (ii) making
an appropriate filing pursuant to the Exchange Act, which will supplement
or amend the Prospectus so that, as supplemented or amended, the Prospectus
when the Prospectus is delivered to a purchaser will comply with the Act
and will 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 light of the circumstances under which they were made, not misleading.
Prior to any such filing, the Company shall give oral notice to the
Purchasers.
(c) The Company will make generally available to its security holders
as soon as practicable, but in any event not later than eighteen months
after the effective date of the Registration Statement (as defined in Rule
158(c) under the Act) an earnings statement of the Company and its
subsidiaries (which need not be audited) which will satisfy the provisions
of Section 11(a) of the Act (including at the option of the Company Rule
158).
(d) The Company will furnish to you copies of the following
documents, in each case as soon as available after filing and in such
quantities as you reasonably request:(i) the Registration Statement
relating to Purchased Stock as originally filed and all pre-effective
amendments thereto (at least one of which will be signed and will include
all exhibits except those incorporated by reference to previous filings
with the Commission); (ii) each prospectus relating to the Purchased Stock;
and (iii) during the time when a prospectus relating to the Purchased Stock
is required to be delivered under the Act, all post-effective amendments
and supplements to the Registration Statement or Prospectus, respectively
(except supplements relating to securities that are not Purchased Stock).
(e) The Company will take such actions as the Purchasers may
reasonably request to obtain the qualification of the Purchased Stock for
sale and the determination of their eligibility for investment under the
laws of such
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jurisdictions as you designate and will continue such qualifications in
effect so long as required for the distribution, provided, however, that
the Company shall not be required to qualify as a foreign corporation or to
file any consent to service of process under the laws of any jurisdiction
or to comply with any other requirements deemed by the Company to be unduly
burdensome.
(f) During the period of five years after the Closing Date, the
Company will furnish to you, and upon request, to each of the other
Purchasers (unless such reports are available electronically on the
Securities and Exchange Commission's website or the Company's website): (i)
as soon as practicable after the end of each fiscal year, a copy of its
annual report to shareholders for such year, (ii) as soon as available, a
copy of each report or definitive proxy statement of the Company filed with
the Commission under the Exchange Act or mailed to shareholders, and (iii)
from time to time, such other information concerning the Company as you may
reasonably request.
(g) The Company will pay all expenses incident to the performance of
its obligations under this Agreement, and will reimburse the Purchasers for
any expenses (including Blue Sky fees not exceeding $6,000 and
disbursements of counsel) incurred by them in connection with qualification
of the Purchased Stock for sale and determination of their eligibility for
investment under the laws of such jurisdictions as you designate and the
printing or reproduction of memoranda relating thereto, for any expenses
incurred in connection with listing the Purchased Stock on a national
securities exchange or for obtaining any required clearance from the
National Association of Securities Dealers Inc. and for expenses incurred
in distributing prospectuses to the Purchasers, except that if this
Agreement is terminated by the Purchasers under Section 6(c) hereof, the
Company shall not be obligated to reimburse the Purchasers for any of the
foregoing expenses.
(h) The Company will not offer or sell any additional shares of its
common stock, other than the Purchased Stock, prior to 30 days after the
Closing Date (other than pursuant to employee stock or option plans,
dividend reinvestment plans and similar plans or any warrants or
convertible or exchangeable securities outstanding prior to the date of the
Purchase Agreement) without the consent of the Purchasers.
(i) If the Company elects to rely upon Rule 462(b), the Company shall
file a Rule 462(b) Registration Statement with the Commission in compliance
with Rule 462(b) and the Company shall at the time of filing either pay to
the Commission the filing fee for the Rule 462(b) Registration Statement or
give irrevocable instructions for the payment of such fee pursuant to Rule
111(b) under the Act.
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6. Conditions of the Obligations of the Purchasers.
A. Purchased Stock. The obligations of the several Purchasers to purchase and
pay for the Purchased Stock will be subject to the accuracy of the
representations and warranties on the part of the Company herein, to the
accuracy of the statements of Company officers made pursuant to the provisions
hereof, to the performance by the Company of its obligations hereunder and to
the following additional conditions precedent:
(a) Subsequent to the signing of the Purchase Agreement, you shall
have received a letter of PricewaterhouseCoopers LLP, dated the Closing
Date, confirming that they are independent public accountants within the
meaning of the Act and the 33 Act Rules and Regulations, and stating in
effect that:
(i) In their opinion, the consolidated financial statements
and supporting schedule audited by them which are included in the
Company's Form 10-K dated __________("Form 10-K"), which is
incorporated by reference in the Registration Statement comply in form
in all material respects with the applicable accounting requirements
of the Act and the 33 Act Rules and Regulations and the Exchange Act
and the Exchange Act Rules and Regulations;
(ii) On the basis of procedures specified in such letter (but
not an audit in accordance with generally accepted auditing
standards), including reading the minutes of meetings of the
shareholders, the Board of Directors and the Executive Committee of
the Company since the end of the year covered by the Form 10-K as set
forth in the minute books through a specified date not more than five
days prior to the Closing Date, performing procedures specified in
Statement on Auditing Standards No. 71, Interim Financial Information,
on the unaudited interim consolidated financial statements of the
Company incorporated by reference in the Registration Statement, if
any, and reading the latest available unaudited interim consolidated
financial statements of the Company, and making inquiries of certain
officials of the Company who have responsibility for financial and
accounting matters as to whether the latest available financial
statements not incorporated by reference in the Registration Statement
are prepared on a basis substantially consistent with that of the
audited consolidated financial statements incorporated by reference in
the Registration Statement, nothing has come to their attention that
has caused them to believe that (1) any unaudited consolidated
financial statements incorporated by reference in the Registration
Statement
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do not comply in form in all material respects with the applicable
requirements of the Act and the 33 Act Rules and Regulations and the
Exchange Act and the Exchange Act Rules and Regulations or any
material modifications should be made to those unaudited consolidated
financial statements for them to be in conformity with generally
accepted accounting principles; (2) at the date of the latest
available balance sheet not incorporated by reference in the
Registration Statement there was any change in the capital stock,
change in long-term debt or decrease in consolidated net assets, or
common shareholders' equity as compared with the amounts shown in the
latest balance sheet incorporated by reference in the Registration
Statement or for the period from the closing date of the latest income
statement incorporated by reference in the Registration Statement to
the closing date of the latest available income statement read by them
there were any decreases, as compared with the corresponding period of
the previous year, in operating revenues, operating income, net income
or in earnings per share of common stock except in all instances for
changes or decreases that the Registration Statement discloses have
occurred or may occur, or which are described in such letter; or (3)
at a specified date not more than five days prior to the Closing Date,
there was any change in the capital stock or long-term debt of the
Company, or, at such date, there was any decrease in net assets of the
Company as compared with amounts shown in the latest balance sheet
incorporated by reference in the Registration Statement, or for the
period from the closing date of the latest income statement
incorporated by reference in the Registration Statement to a specified
date not more than five days prior to the Closing Date, there were any
decreases as compared with the corresponding period of the previous
year, in operating revenues, operating income, or net income, except
in all cases for changes or decreases which the Registration Statement
discloses have occurred or may occur, or which are described in such
letter; and
(iii) Certain specified procedures have been applied to certain
financial or other statistical information (to the extent such
information was obtained from the general accounting records of the
Company) set forth or incorporated by reference in the Registration
Statement and that such procedures have not revealed any disagreement
between the financial and statistical information so set forth or
incorporated by reference in the Registration Statement and the
underlying general accounting records of the Company, except as
described in such letter.
(b) Prior to the Closing Date, no stop order suspending the
effectiveness of the Registration Statement shall have
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been issued and no proceedings for that purpose shall have been instituted,
or to the knowledge of the Company or you, shall be contemplated by the
Commission, and if the Company has elected to rely upon Rule 462(b), the
Rule 462(b) Registration Statement shall have been filed and shall have
become effective in accordance with Rule 462(b).
(c) Subsequent to the date of the Purchase Agreement, (i) there shall
not have occurred any change or any development involving a prospective
change not contemplated by the Prospectus as of the date of the Purchase
Agreement in or affecting particularly the business or properties of the
Company which, in the judgment of a majority in interest of the Purchasers
including you, materially impairs the investment quality of the Purchased
Stock, and (ii) trading in securities generally on the New York Stock
Exchange shall not have been suspended nor limited, other than a temporary
suspension in trading to provide for an orderly market, nor shall minimum
prices have been established on such Exchange, a banking moratorium shall
not have been declared either by New York State or Federal authorities and
there shall not have occurred an outbreak or escalation of major
hostilities in which the United States is involved or other substantial
national or international calamity or crisis (including one caused by a
terrorist act), the effect of which on the financial markets of the United
States is such as to make it, in your judgment, impracticable to market the
Purchased Stock.
(d) You shall have received an opinion, dated the Closing Date, of a
counsel for the Company to the effect that:
(i) The Company, Baltimore Gas and Electric Company, (BGE),
Constellation Generation Group, LLC (CGG), and Constellation
Enterprises, Inc. (CEI), have been duly incorporated or formed and are
validly existing as corporations or a limited liability company, as
the case may be, in good standing under the laws of the State of
Maryland, with power and authority (corporate and other) to own their
respective properties and conduct their respective businesses as
described in the Prospectus; the Company owns all of the outstanding
shares of common stock of BGE and CEI and all of the membership
interests of CGG; and the Company is duly qualified to do business as
a foreign corporation in good standing in all other jurisdictions in
which the conduct of its business or the ownership of its properties
requires such qualification and the failure to do so would have a
material and adverse impact on its financial condition;
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(ii) The statements set forth in the Prospectus under the
caption "Description of Capital Stock" insofar as they purport to
constitute a summary of the terms of the Purchased Stock are accurate
and fair summaries of the matters set forth therein.
(iii) Intentionally left blank
(iv) (a) The issuance and sale of the Purchased Stock has been
duly authorized by all necessary corporate action of the Company, (b)
the Purchased Stock when issued and paid for in accordance with this
Agreement will be fully paid and nonassessable, and (c) there are no
preemptive rights to purchase the Purchased Stock.
(v) The Registration Statement has become effective under the
Act and, (a) to the best of such counsel's knowledge, no stop order
suspending the effectiveness of the Registration Statement has been
issued and no proceedings for that purpose have been instituted or are
pending or contemplated under the Act; (b) the Registration Statement
(as of its effective date) and the Prospectus (as of the date of the
Purchase Agreement) and any amendments or supplements thereto, as of
their respective dates, appeared to comply as to form in all material
respects with the requirements of Form S-3 under the Act and the 33
Act Rules and Regulations and the Trust Indenture Act; (c) such
counsel has no reason to believe that either the Registration
Statement or the Prospectus, or any such amendment or supplement, as
of such respective dates or as of the Closing Date, contained any
untrue statement of a material fact or omitted to state any material
fact required to be stated therein or necessary to make the statements
therein not misleading; (d) the descriptions in the Registration
Statement and Prospectus of statutes, legal and governmental
proceedings and contracts and other documents are accurate and fairly
present the information required to be shown; (e) and such counsel
does not know of any legal or governmental proceedings required to be
described in the Prospectus which are not described as required, or of
any contracts or documents of a character required to be described in
the Registration Statement or Prospectus or to be filed as exhibits to
the Registration Statement which are not described or filed as
required; it being understood that such counsel, in addressing the
matters covered in this paragraph (v) need express no opinion as to
the financial statements or other financial and statistical
information contained in the Registration Statement or the Prospectus
or incorporated therein or attached as an exhibit thereto.
(vi) Counsel knows of no approval of any regulatory authority
which is legally required for the valid
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offering, issuance, sale and delivery of the Purchased Stock by the
Company under this Agreement (except that such opinion need not pass
upon the requirements of state securities acts);
(vii) To the best of such counsel's knowledge and belief, the
consummation of the transactions contemplated in this Agreement did
not and will not result in a breach of any of the terms and provisions
of, or constitute a default under, the Company's Charter or By-Laws or
any indenture, mortgage or deed of trust or other agreement or
instrument to which the Company is a party;
(viii) This Agreement has been duly authorized, executed and
delivered by the Company;
(ix) The issuance, sale and delivery of the Purchased Stock as
contemplated by this Agreement are not subject to the approval of the
Securities and Exchange Commission under the provisions of the Public
Utility Holding Company Act of 1935 (the "1935 Act").
(e) The Purchasers shall have received from Xxxxxx Xxxxxx & Xxxxxxx,
counsel for the Purchasers, an opinion dated the Closing Date, with respect to
the matters referred to in paragraph 6(d) subheadings (ii), (iv), (v)(b), (vi),
(viii) and (ix) and such other matters as the Purchasers shall reasonably
request and the Company shall have furnished to such counsel such documents as
they request for the purpose of enabling them to pass on such matters.
In rendering such opinion, Xxxxxx Xxxxxx & Xxxxxxx may rely, as
to the incorporation of the Company, all other matters governed by the laws of
the State of Maryland and the applicability of the 1935 Act, upon the opinion of
Counsel for the Company referred to above.
In addition, such counsel shall state that such counsel has
participated in conferences with officers, counsel and other representatives of
the Company, representatives of the independent public accountants for the
Company and representatives of the Purchasers at which the contents of the
Registration Statement and the Prospectus and related matters were discussed;
and, although such counsel is not passing upon and does not assume
responsibility for the accuracy, completeness or fairness of the statements
contained in the Registration Statement and Prospectus (except as to the matters
referred to in their opinion rendered pursuant to subheading (ii) above), on the
basis of the foregoing (relying as to materiality to a large extent upon the
opinions of officers, counsel and other representatives of the Company), no
facts have come to the attention of such counsel which lead such counsel to
believe that either the Registration Statement (as of its effective date) or
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the Prospectus (as of the date of the Purchase Agreement and as of the Closing
Date), and any subsequent amendments or supplements thereto, as of their
respective dates, contained an untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary to make such
statements therein, in light of the circumstances under which they were made,
not misleading (it being understood that such counsel need make no comment with
respect to the financial statements and other financial and statistical data
included in the Registration Statement or Prospectus or incorporated therein).
(f) You shall have received a certificate of the Chairman of the
Board, President or any Vice President and a principal financial or accounting
officer of the Company, dated the Closing Date, in which such officers shall
state, to the best of their knowledge after reasonable investigation, and
relying on opinions of counsel to the extent that legal matters are involved,
that the representations and warranties of the Company in this Agreement are
true and correct in all material respects, that the Company has complied with
all agreements and satisfied all conditions on its part to be performed or
satisfied at or prior to the Closing Date, that no stop order suspending the
effectiveness of the Registration Statement has been issued and no proceedings
for that purpose have been instituted or are contemplated by the Commission, and
that, subsequent to the date of the most recent financial statements set forth
or incorporated by reference in the Prospectus, there has been no material
adverse change in the financial position or in the financial results of
operation of the Company except as set forth or contemplated in the Prospectus.
(g) The Company will furnish you with such conformed copies of such
opinions, certificates, letters and documents as you reasonably request.
(h) The New York Stock Exchange, the Chicago Stock Exchange and the
Pacific Stock Exchange shall have approved for listing, upon official notice of
issuance, the Purchased Stock.
In case any such condition shall not have been satisfied, this Agreement may be
terminated by you upon notice in writing or by telecopy to the Company without
liability or obligation on the part of the Company or any Purchaser, except as
set forth in Section 10 hereof.
7. Conditions of the Obligations of the Company. The obligations of
the Company to sell and deliver the Purchased Stock are subject to the following
condition precedent:
Prior to the Closing Date, no stop order suspending the effectiveness
of the Registration Statement shall have been issued and no proceedings for that
purpose shall have been
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instituted or, to the knowledge of the Company or you, shall be contemplated by
the Commission.
If this condition shall not have been satisfied, then the Company
shall be entitled, by notice in writing or by telecopy to you, to terminate
this Agreement at any time prior to the Closing Date, without any liability
on the part of the Company or any Purchaser, except as set forth in Section
10 hereof.
8. Indemnification.
(a) The Company will indemnify and hold harmless each Purchaser and
each person, if any, who controls any Purchaser within the meaning of the
Act or the Exchange Act against any losses, claims, damages or liabilities,
joint or several, to which such Purchaser or such controlling person may
become subject, under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are
based upon any untrue statement or alleged untrue statement of any material
fact contained in the Registration Statement or the Prospectus (or any
supplement or amendment thereto), or any related preliminary prospectus or
arise out of or are based upon the omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make
the statements therein not misleading; and will reimburse each Purchaser
and each such controlling person for any legal or other expenses reasonably
incurred by such Purchaser or such controlling person in connection with
investigating or defending any such loss, claim, damage, liability or
action; provided, however, that the Company will not be liable to such
Purchaser or controlling person in any such case to the extent that any
such loss, claim, damage or liability arises out of or is based upon an
untrue statement or alleged untrue statement or omission or alleged
omission made in any such documents in reliance upon and in conformity with
written information furnished to the Company by such Purchaser or such
controlling person specifically for use therein; and provided, further,
that the Company shall not be liable to any Purchaser under the indemnity
agreement in this subsection (a) with respect to any preliminary prospectus
to the extent that any such loss, claim, damage or liability of such
Purchaser results from the fact such Purchaser sold Purchased Stock to a
person to whom there was not sent or given, at or prior to the written
confirmation of such sale, a copy of the Prospectus (excluding documents
incorporated by reference) or of the Prospectus as then amended or
supplemented (excluding documents incorporated by reference) in any case
where such delivery is required by the Act if the Company has previously
furnished copies thereof to such Purchaser and the loss, claim, damage or
liability of such Purchaser results from an untrue statement or omission of
a
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material fact contained in the preliminary prospectus which was corrected
in the Prospectus (or the Prospectus as amended or supplemented). This
indemnity agreement will be in addition to any liability which the Company
may otherwise have.
(b) Each Purchaser will indemnify and hold harmless the Company, each
of its directors and officers and each person, if any, who controls the
Company within the meaning of the Act or the Exchange Act, against any
losses, claims, damages or liabilities to which the Company or any such
director, officer or controlling person may become subject, under the Act,
or otherwise, insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of or are based upon any untrue
statement or alleged untrue statement of any material fact contained in the
Registration Statement or the Prospectus (or any supplement or amendment
thereto), or any related preliminary prospectus or arise out of or are
based upon the omission or the alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements
therein not misleading, in each case to the extent, but only to the extent,
that such untrue statement or alleged untrue statement or omission or
alleged omission was made in reliance upon and in conformity with written
information furnished to the Company by such Purchaser specifically for use
therein; and will reimburse any legal or other expenses reasonably incurred
by the Company or any such director, officer or controlling person in
connection with investigating or defending any such loss, claim, damage,
liability or action as such expenses are incurred. This indemnity agreement
will be in addition to any liability which such Purchaser may otherwise
have.
(c) Promptly after receipt by an indemnified party under this Section
of notice of the commencement of any action, such indemnified party will,
if a claim in respect thereof is to be made against the indemnifying party
under (a) and (b) above, notify the indemnifying party of the commencement
thereof; but the omission so to notify the indemnifying party will not
relieve it from any liability which it may have to any indemnified party
otherwise than under this Section except to the extent the indemnifying
party has been materially prejudiced by such omission. In case any such
action is brought against any indemnified party, and it notifies the
indemnifying party of the commencement thereof, the indemnifying party will
be entitled to participate therein and, to the extent that it may wish,
jointly with any other indemnifying party similarly notified, to assume the
defense thereof, with counsel satisfactory to such indemnified party (who
may, with the consent of the indemnified party, be counsel to the
indemnifying party) and who shall not be counsel to any other indemnified
party who may have interests conflicting with those of such indemnified
party, and after notice from the indemnifying party to such
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indemnified party of its election so to assume the defense thereof, the
indemnifying party will not be liable to such indemnified party under this
Section for any legal or other expenses subsequently incurred by such
indemnified party in connection with the defense thereof other than
reasonable costs of investigation.
(d) If recovery is not available under the foregoing indemnification
provisions of this Section, for any reason other than as specified therein,
the parties entitled to indemnification by the terms thereof shall be
entitled to contribution to liabilities and expenses, except to the extent
that contribution is not permitted under Section 11(f) of the Act. In
determining the amount of contribution to which the respective parties are
entitled, there shall be considered the relative benefits received by each
party from the offering of the Purchased Stock (taking into account the
portion of the proceeds of the offering realized by each), the parties'
relative knowledge and access to information concerning the matter with
respect to which the claim was asserted, the opportunity to correct and
prevent any statement or omission, and any other equitable considerations
appropriate under the circumstances. The Company and the Purchasers and
such controlling persons agree that it would not be equitable if the amount
of such contribution were determined by pro rata or per capita allocation
(even if the Purchasers and such controlling persons were treated as one
entity for such purpose). Notwithstanding the provisions of this subsection
(d), no Purchaser or controlling person shall be required to make
contribution hereunder which in the aggregate exceeds the total public
offering price of the Purchased Stock, purchased by the Purchaser under
this Agreement, less the aggregate amount of any damages which such
Purchaser or such controlling person has otherwise been required to pay in
respect of the same claim or any substantially similar claim. The
Purchasers' obligations to contribute are several in proportion to their
respective underwriting obligations and are not joint.
9. Default of Purchasers. If any Purchaser or Purchasers default in
their obligations to purchase Purchased Stock hereunder and the number of shares
of Purchased Stock which such defaulting Purchaser or Purchasers agreed but
failed to purchase is 10% of the number of shares of Purchased Stock or less,
the non-defaulting Purchasers may make arrangements satisfactory to the Company
for the purchase of such Purchased Stock by other persons, including any of the
Purchasers, but if no such arrangements are made by the Closing Date the
non-defaulting Purchasers shall be obligated severally, in proportion to their
respective commitments hereunder, to purchase the Purchased Stock which such
defaulting Purchasers agreed but failed to purchase. If any Purchaser or
Purchasers so default and the aggregate number of shares of Purchased Stock with
respect to which such default or defaults occur is more than the
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above percentage and arrangements reasonably satisfactory to you and the Company
for the purchase of such Purchased Stock by other persons are not made within
seventy-two hours after such default, this Agreement will terminate without
liability on the part of any non-defaulting Purchaser or the Company, except as
provided in Section 10. In the event that any Purchaser or Purchasers default in
their obligation to purchase Purchased Stock hereunder, the Company may, by
prompt written notice to the non-defaulting Purchasers, postpone the Closing
Date, for a period of not more than seven full business days in order to effect
whatever changes may thereby be made necessary in the Registration Statement or
the Prospectus or in any other documents, and the Company will promptly file any
amendments to the Registration Statement or supplements to the Prospectus which
may thereby be made necessary. As used in this Agreement, the term "Purchaser"
includes any person substituted for a Purchaser under this Section. Nothing
herein will relieve a defaulting Purchaser from liability for its default.
10. Survival of Certain Representations and Obligations. The
respective indemnities, agreements, representations, warranties, and other
statements of the Company or its officers and of the several Purchasers set
forth in or made pursuant to this Agreement will remain in full force and
effect, regardless of any investigation, or statement as to the results thereof,
made by or on behalf of any Purchaser or the Company or any of its officers or
directors or any controlling person, and will survive delivery of and payment
for the Purchased Stock. If this Agreement is terminated pursuant to Section 6,
7 or 9 or if for any reason the purchase of the Purchased Stock by the
Purchasers is not consummated, the Company shall remain responsible for the
expenses to be paid or reimbursed by it pursuant to Section 5(g). In addition,
in such event the respective obligations of the Company and the Purchasers
pursuant to Section 8 shall remain in effect; provided, however, that each
Purchaser will use their best efforts to promptly notify each other Purchaser
and each dealer and prospective customer to whom such Purchaser has delivered a
Prospectus for the Purchased Stock by telephone or telegraph, confirmed by
letter in either case, of such termination or failure to consummate, including
in such notice instructions regarding the continued use of the Registration
Statement, the Prospectus, or any amendment or supplement thereto, or any
related preliminary prospectus.
11. Notices. All communications hereunder will be in writing, and, if
sent to the Purchasers will be delivered or telecopied and confirmed to the
address furnished in writing for the purpose of such communications hereunder,
or, if sent to the Company, will be delivered or telecopied and confirmed to it,
attention of Treasurer at 000 X. Xxxxx Xxxxxx, 00xx Xxxxx, Xxxxxxxxx, Xxxxxxxx
00000, telecopier (000) 000-0000;
12. Successors. This Purchase Agreement will inure to the benefit of
and be binding upon the parties hereto and their
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respective successors and the officers and directors and controlling persons
referred to in Section 8, and no other person will have any right or obligation
hereunder. The term "successors" shall not include any purchaser of any
Purchased Stock merely because of such purchase.
13. Construction. This Purchase Agreement shall be governed by and
construed in accordance with the laws of the State of Maryland.
14. Counterparts. This Agreement may be executed in one or more
counterparts and it is not necessary that the signatures of all parties appear
on the same counterpart, but such counterparts together shall constitute but one
and the same agreement.
