EXHIBIT 1.1
EXECUTION VERSION
================================================================================
AUTOZONE, INC.
(a Nevada corporation)
UNDERWRITING AGREEMENT FOR
DEBT SECURITIES
Dated: June 8, 2006
================================================================================
TABLE OF CONTENTS
PAGE
SECTION 1. Representations and Warranties..........................................3
SECTION 2. Sale and Delivery to Underwriters; Closing.............................12
SECTION 3. Covenants of the Company...............................................13
SECTION 4. Payment of Expenses....................................................16
SECTION 5. Conditions of Underwriters' Obligations................................17
SECTION 6. Indemnification........................................................19
SECTION 7. Contribution...........................................................21
SECTION 8. Representations, Warranties and Agreements to Survive Delivery.........23
SECTION 9. Termination............................................................23
SECTION 10. Default by One or More of the Underwriters.............................24
SECTION 11. Notices................................................................24
SECTION 12. No Advisory or Fiduciary Relationship..................................25
SECTION 13. Integration............................................................25
SECTION 14. Parties................................................................25
SECTION 15. Governing Law and Time.................................................25
SECTION 16. Effect of Headings.....................................................26
i
AUTOZONE, INC.
(a Nevada corporation)
UNDERWRITING AGREEMENT
FOR DEBT SECURITIES
June 8, 2006
X.X. Xxxxxx Securities Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated
0 Xxxxx Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
AutoZone, Inc., a Nevada corporation (the "Company"), proposes to issue
and sell up to $200,000,000 aggregate principal amount of its senior or
subordinated debt securities (the "Securities"), from time to time, in or
pursuant to one or more offerings on terms to be determined at the time of sale.
The Securities will be issued in one or more series as senior or
subordinated indebtedness under an indenture dated as of August 8, 2003 (the
"Indenture"), between the Company and X.X. Xxxxxx Trust Company, National
Association, successor in interest to Bank One Trust Company, N.A., as trustee
(the "Trustee"). Each series of Securities may vary, as applicable, as to title,
aggregate principal amount, rank, interest rate or formula and timing of
payments thereof, stated maturity date, redemption and/or repayment provisions,
sinking fund requirements, conversion provisions and any other variable terms
established by or pursuant to the Indenture.
Whenever the Company determines to make an offering of Securities
through X.X. Xxxxxx Securities Inc. and Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated (together, the "Representatives"), or through an underwriting
syndicate managed by the Representatives, the Company will enter into an
agreement (each, a "Terms Agreement") providing for the sale of such Securities
to, and the purchase and offering thereof by, the Representatives and such other
underwriters, if any, selected by the Company (the "Underwriters," which term
shall include the Representatives, whether acting as the only Underwriters or as
members of an underwriting syndicate, as well as any Underwriter substituted
pursuant to Section 10 hereof). The Terms Agreement relating to the offering of
Securities shall specify the number or aggregate principal amount, as the case
may be, of Securities to be initially issued (the "Underwritten Securities"),
the name of each Underwriter participating in such offering (subject to
substitution as provided in Section 10 hereof) and the name of any Underwriter
other than the Representatives acting as co-manager in connection with such
offering, the number or aggregate principal amount, as the case may be, of
Underwritten Securities which each such Underwriter severally and not jointly
agrees to purchase, whether such offering is on a fixed or variable price basis
and, if on a fixed
price basis, the initial offering price, the price at which the Underwritten
Securities are to be purchased by the Underwriters, the form, time, date and
place of delivery and payment of the Underwritten Securities and any other
material variable terms of the Underwritten Securities. The Terms Agreement,
which shall be substantially in the form of Exhibit A hereto, may take the form
of an exchange of any standard form of written telecommunication between the
Company and the Representatives, acting for themselves and, if applicable, as
representatives of any other Underwriters. Each offering of Underwritten
Securities through the Representatives as the only Underwriters or through an
underwriting syndicate managed by the Representatives will be governed by this
Underwriting Agreement, as supplemented by the applicable Terms Agreement.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (No. 333-118308) for the
registration of the Securities under the Securities Act of 1933, as amended (the
"1933 Act"), and the offering thereof from time to time in accordance with Rule
415 of the rules and regulations of the Commission under the 1933 Act (the "1933
Act Regulations"). Such registration statement covers the registration of the
Underwritten Securities under the 1933 Act and has been declared effective by
the Commission and the Indenture has been duly qualified under the Trust
Indenture Act of 1939, as amended (the "1939 Act"). The Company has filed such
post-effective amendments thereto as may be required prior to the execution of
the applicable Terms Agreement and each such post-effective amendment has been
declared effective by the Commission. Promptly after execution and delivery of
the applicable Terms Agreement, the Company will prepare and file a prospectus
in accordance with the provisions of Rule 430B ("Rule 430B") of the 1933 Act
Regulations and paragraph (b) of Rule 424 ("Rule 424(b)") of the 1933 Act
Regulations. Any information included in such prospectus that was omitted from
such registration statement at the time it became effective but that is deemed
to be part of and included in such registration statement pursuant to Rule 430B
is referred to as "Rule 430B Information." Each prospectus used in connection
with the offering of the Underwritten Securities that omitted Rule 430B
Information is herein called a "preliminary prospectus." Such registration
statement, at any given time, including the amendments thereto to such time, the
exhibits and any schedules thereto at such time, the documents incorporated by
reference therein pursuant to Item 12 of Form S-3 under the 1933 Act at such
time and the documents otherwise deemed to be a part thereof or included therein
by 1933 Act Regulations, is herein called the "Registration Statement";
provided, that if the Company files a registration statement with the Commission
pursuant to Rule 462(b) of the 1933 Act Regulations (the "Rule 462(b)
Registration Statement"), then, after such filing, all references to
"Registration Statement" shall also be deemed to include the Rule 462
Registration Statement. The Registration Statement at the time it originally
became effective is herein called the "Original Registration Statement." The
final prospectus in the form first furnished to the Underwriters for use in
connection with the offering of the Underwritten Securities, including the
documents incorporated by reference therein pursuant to Item 12 of Form S-3
under the 1933 Act at the time of the execution of the applicable Terms
Agreement and any preliminary prospectuses that form a part thereof, is herein
called the "Prospectus." For purposes of this Underwriting Agreement, all
references to the Registration Statement, Prospectus or preliminary prospectus
or to any amendment or supplement to any of the foregoing shall be deemed to
include any copy filed with the Commission pursuant to its Electronic Data
Gathering, Analysis and Retrieval system ("XXXXX").
2
All references in this Underwriting Agreement to financial statements
and schedules and other information which is "contained," "included" or "stated"
(or other references of like import) in the Registration Statement, Prospectus
or preliminary prospectus shall be deemed to mean and include all such financial
statements and schedules and other information which is incorporated by
reference in or otherwise deemed by 1933 Act Regulations to be part of or
included in the Registration Statement, Prospectus or preliminary prospectus, as
the case may be, prior to the execution of the applicable Terms Agreement; and
all references in this Underwriting Agreement to amendments or supplements to
the Registration Statement, Prospectus or preliminary prospectus shall be deemed
to mean and include the filing of any document under the 1934 Act which is
incorporated by reference in or otherwise deemed by 1933 Act Regulations to be
part of or included in the Registration Statement, Prospectus or preliminary
prospectus, as the case may be, after the execution of the applicable Terms
Agreement.
SECTION 1. Representations and Warranties.
(a) Representations and Warranties by the Company. The Company
represents and warrants to the Representatives, as of the date hereof, and to
each Underwriter named in the applicable Terms Agreement, as of the date thereof
and as of the Closing Time (as defined below) (in each case, a "Representation
Date"), as follows:
(i) Status as a Well-Known Seasoned Issuer. At the date
hereof, the Company is a "well-known seasoned issuer" as defined in
Rule 405 of the 1933 Act Regulations ("Rule 405"), including not being
an "ineligible issuer" as defined in Rule 405.
At the time of filing the Original Registration Statement, at
the earliest time thereafter that the Company or another offering
participant made a bona fide offer (within the meaning of Rule
164(h)(2) of the 1933 Act Regulations) of the Underwritten Securities
and at the date hereof, the Company was not and is not an "ineligible
issuer," as defined in Rule 405.
(ii) Compliance with Registration Requirements. The Company
meets the requirements for use of Form S-3 under the 1933 Act. The
Registration Statement (including any Rule 462(b) Registration
Statement) has become effective under the 1933 Act and no stop order
suspending the effectiveness of the Registration Statement (or such
Rule 462(b) Registration Statement) has been issued under the 1933 Act
and no proceedings for that purpose have been instituted or are pending
or, to the knowledge of the Company, are contemplated by the
Commission, and any request on the part of the Commission for
additional information has been complied with. In addition, the
Indenture has been duly qualified under the 1939 Act.
At the respective times the Original Registration Statement
(and any Rule 462(b) Registration Statement) and each amendment thereto
(including the filing of the Company's most recent Annual Report on
Form 10-K with the Commission (the "Annual Report on Form 10-K"))
became effective, at each deemed effective date with respect to the
Underwriters pursuant to Rule 430B(f)(2) of the 1933 Act Regulations
and at each Representation Date, the Registration Statement (including
any Rule 462(b) Registration
3
Statement) and any amendments thereto complied and will comply in all
material respects with the requirements of the 1933 Act and the 1933
Act Regulations and the 1939 Act and the rules and regulations of the
Commission under the 1939 Act (the "1939 Act Regulations") and did not
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 not misleading. At the date of the
Prospectus and at the Closing Time, neither the Prospectus nor any
amendments and supplements thereto included or will include an untrue
statement of a material fact or omitted or will 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.
Each preliminary prospectus (including the prospectus or
prospectuses filed as part of the Original Registration Statement or
any amendment thereto, or filed pursuant to Rule 424 under the 1933
Act), complied when so filed in all material respects with the 1933 Act
Regulations and each preliminary prospectus and the Prospectus
delivered to the Underwriters for use in connection with the offering
of Underwritten Securities will, at the time of such delivery, be
identical to any electronically transmitted copies thereof filed with
the Commission pursuant to XXXXX, except to the extent permitted by
Regulation S-T.
As of the Applicable Time (as defined below), neither (x) the
Issuer General Use Free Writing Prospectus(es) (as defined below)
issued at or prior to the Applicable Time and the Statutory Prospectus
(as defined below), all considered together (collectively, the "General
Disclosure Package"), nor (y) any individual Issuer Limited Use Free
Writing Prospectus, when considered together with the General
Disclosure Package, included 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 the circumstances under which they
were made, not misleading.
As of the time of the filing of the Final Term Sheet (as
defined in Section 3(b)), the General Disclosure Package, when
considered together with the Final Term Sheet, will not 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, not misleading.
As used in this subsection and elsewhere in this Agreement:
"Applicable Time" means such time as agreed by the Company and
the Representatives in the applicable Terms Agreement.
"Issuer Free Writing Prospectus" means any "issuer free
writing prospectus," as defined in Rule 433 of the 1933 Act Regulations
("Rule 433"), relating to the Underwritten Securities that (i) is
required to be filed with the Commission by the Company, (ii) is a
"road show that is a written communication" within the meaning of Rule
433(d)(8)(i), whether or not required to be filed with the Commission
or (iii) is exempt from filing pursuant to Rule 433(d)(5)(i) because it
contains a description of the Underwritten Securities or of the
offering that does not reflect the final terms, in each
4
case in the form filed or required to be filed with the Commission or,
if not required to be filed, in the form retained in the Company's
records pursuant to Rule 433(g).
"Issuer General Use Free Writing Prospectus" means any Issuer
Free Writing Prospectus that is intended for general distribution to
prospective investors, as evidenced by its being specified in Schedule
A hereto.
"Issuer Limited Use Free Writing Prospectus" means any Issuer
Free Writing Prospectus that is not an Issuer General Use Free Writing
Prospectus.
"Statutory Prospectus" as of any time means the prospectus
relating to the Underwritten Securities that is included in the
Registration Statement immediately prior to that time, including any
document incorporated by reference therein and any preliminary or other
prospectus deemed to be a part thereof.
Each Issuer Free Writing Prospectus, as of its issue date and
at all subsequent times through the completion of the public offer and
sale of the Underwritten Securities or until any earlier date that the
issuer notified or notifies the Representatives as described in Section
3(e), 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 Prospectus, including any document
incorporated by reference therein and any preliminary or other
prospectus deemed to be a part thereof that has not been superseded or
modified.
The representations and warranties in this subsection shall
not apply to statements in or omissions from the Registration
Statement, the Prospectus or any Issuer Free Writing Prospectus made in
reliance upon and in conformity with written information furnished to
the Company by any Underwriter through the Representatives expressly
for use therein.
(iii) Incorporated Documents. The documents incorporated or
deemed to be incorporated by reference in the Registration Statement,
the General Disclosure Package and the Prospectus, when they became
effective or at the time they were or hereafter are filed with the
Commission, complied and will comply in all material respects with the
requirements of the 1934 Act and the rules and regulations of the
Commission thereunder (the "1934 Act Regulations") and, when read
together with the other information in the Prospectus and the General
Disclosure Package, (a) at the time the Original Registration Statement
became effective, (b) at the earlier of time the Prospectus was first
used and the date and time of the first contract of sale of
Underwritten Securities in the offering as set forth in the applicable
Terms Agreement and (c) at the Closing Time, did not and will not
include an 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.
(iv) Independent Accountants. The accountants who audited the
financial statements and any supporting schedules thereto incorporated
by reference in the
5
Registration Statement and the Prospectus are an independent registered
public accounting firm as required by the 1933 Act and the 1933 Act
Regulations.
(v) Financial Statements. The financial statements of the
Company included in the Registration Statement, the General Disclosure
Package and the Prospectus, together with the related schedules and
notes, as well as those financial statements, schedules and notes of
any other entity included therein, present fairly the financial
position of the Company and its consolidated subsidiaries, or such
other entity, as the case may be, at the dates indicated and the
statements of operations, stockholders' equity and cash flows of the
Company and its consolidated subsidiaries, or such other entity, as the
case may be, for the periods specified. Such financial statements have
been prepared in conformity with accounting principles generally
accepted in the United States ("GAAP") applied on a consistent basis
throughout the periods involved. The supporting schedules, if any,
present fairly in accordance with GAAP the information required to be
stated therein. The selected financial data included in the General
Disclosure Package or the Prospectus present fairly the information
shown therein and have been compiled on a basis consistent with that of
the audited financial statements incorporated by reference in the
Registration Statement and the Prospectus. All disclosures contained in
the Registration Statement, the General Disclosure Package or the
Prospectus regarding "non-GAAP financial measures" (as such term is
defined by the rules and regulations of the Commission) comply with
Regulation G under the 1934 Act and Item 10 of Regulation S-K of the
1933 Act Regulations, to the extent applicable.
(vi) No Material Adverse Change in Business. Since the
respective dates as of which information is given in the Registration
Statement, the General Disclosure Package or the Prospectus, except as
otherwise stated therein, (A) there has been no material adverse change
in the financial condition, earnings, management or business affairs,
or any development involving a prospective material adverse change in
the financial condition, earnings, management or business affairs, of
the Company and its subsidiaries considered as one enterprise, whether
or not arising in the ordinary course of business (a "Material Adverse
Effect"), (B) there have been no transactions entered into by the
Company or any of its subsidiaries, other than those arising in the
ordinary course of business, which are material with respect to the
Company and its subsidiaries considered as one enterprise and (C) there
has been no dividend or distribution of any kind declared, paid or made
by the Company on any class of its capital stock.
(vii) Good Standing of the Company. The Company has been duly
organized and is validly existing as a corporation in good standing
under the laws of the State of Nevada and has corporate power and
authority to own, lease and operate its properties and to conduct its
business as described in the Prospectus and to enter into and perform
its obligations under, or as contemplated under, this Underwriting
Agreement and the applicable Terms Agreement. The Company is duly
qualified as a foreign corporation to transact business and is in good
standing in each other jurisdiction in which such qualification is
required, whether by reason of the ownership or leasing of property or
the conduct of business, except where the failure to so qualify or be
in good standing would not, individually or in the aggregate, result in
a Material Adverse Effect.
6
(viii) Good Standing of Subsidiaries. Each "significant
subsidiary" of the Company (as such term is defined in Rule 1-02 of
Regulation S-X promulgated under the 0000 Xxx) (each, a "Subsidiary"
and, collectively, the "Subsidiaries"), if any, has been duly organized
and is validly existing as a corporation, limited liability company or
limited partnership in good standing under the laws of the jurisdiction
of its organization, has corporate, limited liability company or
partnership power and authority to own, lease and operate its
properties and to conduct its business as described in the Prospectus
and is duly qualified as a foreign corporation, limited liability
company or partnership, as the case may be, to transact business and is
in good standing in each jurisdiction in which such qualification is
required, whether by reason of the ownership or leasing of property or
the conduct of business, except where the failure to so qualify or be
in good standing would not, individually or in the aggregate, result in
a Material Adverse Effect. Except as otherwise stated in the
Registration Statement and the Prospectus, all of the issued and
outstanding capital stock, limited liability company member interests
or partnership interests of each Subsidiary have been duly authorized
and are validly issued, fully paid and non-assessable and are owned by
the Company, directly or through subsidiaries (with the exception of
the preferred stock of AutoZone Development Corporation of which the
Company owns, directly and indirectly, 1,085 shares and others own 115
shares), free and clear of any security interest, mortgage, pledge,
lien, encumbrance, claim or equity. None of the outstanding shares of
capital stock, limited liability company member interests or
partnership interest of any Subsidiary was issued in violation of
preemptive or other similar rights of any securityholder of such
Subsidiary.
(ix) Capitalization. If the Prospectus contains a
"Capitalization" section, the stockholders' equity and the consolidated
short-term and long-term debt of the Company is as set forth in the
column entitled "Actual" under such section (except for (A) subsequent
issuances thereof, if any, contemplated under this Underwriting
Agreement, (B) pursuant to reservations, agreements or employee benefit
plans referred to in the Prospectus, (C) repurchases of shares of
common stock, par value $0.01 per share, of the Company under its
previously announced stock repurchase program, (D) pursuant to the
exercise of convertible securities or options referred to in the
Prospectus and (E) increases not in excess of $50 million in the
aggregate in consolidated long-term debt). Such shares of capital stock
have been duly authorized and validly issued by the Company and are
fully paid and non-assessable, and none of such shares of capital stock
was issued in violation of preemptive or other similar rights of any
securityholder of the Company.
(x) Authorization of this Underwriting Agreement and Terms
Agreement. This Underwriting Agreement has been, and the applicable
Terms Agreement as of the date thereof will have been, duly authorized,
executed and delivered by the Company.
(xi) Authorization of the Securities. The Underwritten
Securities have been, or as of the date of such Terms Agreement will
have been, duly authorized by the Company for issuance and sale
pursuant to this Underwriting Agreement and such Terms Agreement. Such
Underwritten Securities, when issued and authenticated in the manner
provided for in the Indenture and delivered against payment of the
consideration therefor specified in such Terms Agreement, will
constitute valid and binding obligations of the
7
Company enforceable against the Company in accordance with their terms,
except as the enforcement thereof may be limited by bankruptcy,
insolvency (including, without limitation, all laws relating to
fraudulent transfers), reorganization, moratorium or other similar laws
affecting the enforcement of creditors' rights generally or by general
equitable principles (regardless of whether enforcement is considered
in a proceeding in equity or at law), and except further as enforcement
thereof may be limited by requirements that a claim with respect to any
Securities payable in a foreign or composite currency (or a foreign or
composite currency judgment in respect of such claim) be converted into
U.S. dollars at a rate of exchange prevailing on a date determined
pursuant to applicable law or by governmental authority to limit, delay
or prohibit the making of payments outside the United States. Such
Underwritten Securities will be in the form contemplated by, and each
registered holder thereof is entitled to the benefits of, the
Indenture.
(xii) Authorization of the Indenture. The Indenture has been,
or prior to the issuance of the Securities thereunder will have been,
duly authorized, executed and delivered by the Company and, upon such
authorization, execution and delivery, will constitute a valid and
binding agreement of the Company enforceable against the Company in
accordance with its terms, except as the enforcement thereof may be
limited by bankruptcy, insolvency (including, without limitation, all
laws relating to fraudulent transfers), reorganization, moratorium or
other similar laws affecting the enforcement of creditors' rights
generally or by general equitable principles (regardless of whether
enforcement is considered in a proceeding in equity or at law).
(xiii) Descriptions of the Underwritten Securities and
Indenture. The Underwritten Securities being sold pursuant to the
applicable Terms Agreement and the Indenture, as of each Representation
Date, conform in all material respects to the statements relating
thereto contained in the Prospectus and are in substantially the form
filed or incorporated by reference, as the case may be, as an exhibit
to the Registration Statement.
(xiv) Absence of Defaults and Conflicts. Neither the Company
nor any of its Subsidiaries is (a) in violation of its charter or
by-laws, (b) in default in the performance or observance of any
obligation, agreement, covenant or condition contained in any contract,
indenture, mortgage, deed of trust, loan or credit agreement, note,
lease or other agreement or instrument to which the Company or any of
its Subsidiaries is a party or by which it or any of them may be bound,
or to which any of the assets, properties or operations of the Company
or any of its Subsidiaries is subject (collectively, "Agreements and
Instruments"), except for such defaults that would not, individually or
in the aggregate, result in a Material Adverse Effect or (c) in
violation of any applicable law, statute, rule, regulation, judgment,
order, writ or decree of any government, government instrumentality or
court, domestic or foreign, having jurisdiction over the Company or any
of its Subsidiaries or any of their assets, properties or operations,
except for violations that would not, individually or in the aggregate,
result in a Material Adverse Effect. The execution, delivery and
performance of this Underwriting Agreement, the applicable Terms
Agreement and the Indenture and any other agreement or instrument
entered into or issued or to be entered into or issued by the Company
in
8
connection with the transactions contemplated hereby or thereby or in
the Registration Statement and the Prospectus and the consummation of
the transactions contemplated herein and in the Registration Statement
and the Prospectus (including the issuance and sale of the Underwritten
Securities and the use of the proceeds from the sale of the
Underwritten Securities as described under the caption "Use of
Proceeds") and compliance by the Company with its obligations hereunder
and thereunder have been duly authorized by all necessary corporate
action and do not and will not, whether with or without the giving of
notice or passage of time or both, (i) conflict with or constitute a
breach of or default or Repayment Event (as defined below) under, or
(ii) result in the creation or imposition of any lien, charge or
encumbrance upon any assets, properties or operations of the Company or
any of its Subsidiaries pursuant to, any Agreements and Instruments,
nor will such action result in any violation of (a) the provisions of
the charter or by-laws of the Company or any of its Subsidiaries or (b)
any applicable law, statute, rule, regulation, judgment, order, writ or
decree of any government, government instrumentality or court, domestic
or foreign, having jurisdiction over the Company or any of its
Subsidiaries or any of their assets, properties or operations. As used
herein, a "Repayment Event" means any event or condition which gives
the holder of any note, debenture or other evidence of indebtedness (or
any person acting on such holder's behalf) the right to require the
repurchase, redemption or repayment of all or a portion of such
indebtedness by the Company or any of its subsidiaries.
(xv) Absence of Proceedings. There is no action, suit,
proceeding, inquiry or investigation before or brought by any court or
governmental agency or body, domestic or foreign, now pending, or to
the knowledge of the Company threatened, against or affecting the
Company or any of its subsidiaries which is required to be disclosed in
the Registration Statement and the Prospectus (other than as stated
therein), or which might reasonably be expected to result, individually
or in the aggregate, in a Material Adverse Effect, or which might
reasonably be expected to materially and adversely affect the assets,
properties or operations thereof or the consummation of the
transactions contemplated under the Prospectus, this Underwriting
Agreement, the applicable Terms Agreement or the Indenture, or the
performance by the Company of its obligations hereunder and thereunder.
The aggregate of all pending legal or governmental proceedings to which
the Company or any of its subsidiaries is a party or of which any of
their respective assets, properties or operations is the subject which
are not described in the Registration Statement and the Prospectus,
including ordinary routine litigation incidental to the business, could
not reasonably be expected to result, individually or in the aggregate,
in a Material Adverse Effect.
(xvi) Accuracy of Exhibits. There are no contracts or
documents which are required to be described in the Registration
Statement, the Prospectus or the documents incorporated by reference
therein or to be filed as exhibits thereto which have not been so
described and filed as required.
(xvii) Absence of Further Requirements. No filing with, or
authorization, approval, consent, license, order, registration,
qualification or decree of, any court or governmental authority or
agency, domestic or foreign, is necessary or required for the due
authorization, execution and delivery by the Company of this
Underwriting
9
Agreement or the applicable Terms Agreement or for the performance by
the Company of the transactions contemplated under the Prospectus, this
Underwriting Agreement, such Terms Agreement or the Indenture, except
such as have been already made, obtained or rendered, as applicable.
(xviii) Possession of Intellectual Property. The Company and
its subsidiaries own or possess, or can acquire on reasonable terms,
adequate patents, patent rights, licenses, inventions, copyrights,
know-how (including trade secrets and other unpatented and/or
unpatentable proprietary or confidential information, systems or
procedures), trademarks, service marks, trade names or other
intellectual property (collectively, "Intellectual Property") necessary
to carry on the business now operated by them, and neither the Company
nor any of its subsidiaries has received any written notice or is
otherwise aware of any infringement of or conflict with asserted rights
of others with respect to any Intellectual Property or of any facts or
circumstances which would render any Intellectual Property invalid or
inadequate to protect the interest of the Company or any of its
subsidiaries therein, and which infringement or conflict (if the
subject of any unfavorable decision, ruling or finding) or invalidity
or inadequacy, individually or in the aggregate, would result in a
Material Adverse Effect.
(xix) Title to Property. The Company and its subsidiaries have
good and marketable title to all real property owned by the Company and
its subsidiaries and good title to all other properties owned by them,
in each case, free and clear of all mortgages, pledges, liens, security
interests, claims, restrictions or encumbrances of any kind, except (A)
as otherwise stated in the Registration Statement and the Prospectus or
(B) those which do not, singly or in the aggregate, 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 or any of its
subsidiaries. All of the leases and subleases material to the business
of the Company and its subsidiaries considered as one enterprise, and
under which the Company or any of its subsidiaries holds properties
described in the Prospectus, are in full force and effect, and neither
the Company nor any of its subsidiaries has received any written notice
of any claim of any sort that has been asserted by anyone adverse to
the rights of the Company or any of its subsidiaries under any of the
leases or subleases mentioned above, or affecting or questioning the
rights of the Company or such subsidiary of the continued possession of
the leased or subleased premises under any such lease or sublease where
such claim or claims, individually or in the aggregate, would result in
a Material Adverse Effect.
(xx) Investment Company Act. The Company is not, and upon the
issuance and sale of the Underwritten Securities as herein contemplated
and the application of the net proceeds therefrom as described in the
Prospectus will not be, an "investment company" within the meaning of
the Investment Company Act of 1940, as amended (the "1940 Act").
(xxi) Environmental Laws. Except as otherwise stated in the
Registration Statement and the Prospectus and except as would not,
singly or in the aggregate, result in a Material Adverse Effect, (A)
neither the Company nor any of its subsidiaries is in violation of any
federal, state, local or foreign statute, law, rule, regulation,
ordinance,
10
code, policy or rule of common law or any judicial or administrative
interpretation thereof including any judicial or administrative order,
consent, decree or judgment, relating to pollution or protection of
human health, the environment (including, without limitation, ambient
air, surface water, groundwater, land surface or subsurface strata) or
wildlife, including, without limitation, laws and regulations relating
to the release or threatened release of chemicals, pollutants,
contaminants, wastes, toxic substances, hazardous substances, petroleum
or petroleum products (collectively, "Hazardous Materials") or to the
manufacture, processing, distribution, use, treatment, storage,
disposal, transport or handling of Hazardous Materials (collectively,
"Environmental Laws"), (B) the Company and its subsidiaries have all
permits, authorizations and approvals required under any applicable
Environmental Laws and are each in compliance with their requirements,
(C) there are no pending or threatened, to the Company's knowledge,
administrative, regulatory or judicial actions, suits, demands, demand
letters, claims, liens, notices of noncompliance or violation,
investigation or proceedings relating to any Environmental Law against
the Company or any of its subsidiaries and (D) there are no events or
circumstances that might reasonably be expected to form the basis of an
order for clean-up or remediation, or an action, suit or proceeding by
any private party or governmental body or agency, against or affecting
the Company or any of its subsidiaries relating to Hazardous Materials
or any Environmental Laws.
(xxii) Accounting Controls and Disclosure Controls. The
Company and each of its subsidiaries maintain a system of internal
accounting controls sufficient to provide reasonable assurances that
(1) transactions are executed in accordance with management's general
or specific authorization; (2) transactions are recorded as necessary
to permit preparation of financial statements in conformity with GAAP
and to maintain accountability for assets; (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 is taken with respect to any differences. Except as
described in the Prospectus, since the end of the Company's most recent
audited fiscal year, there has been (I) no material weakness in the
Company's internal control over financial reporting (whether or not
remediated) and (II) no change in the Company's internal control over
financial reporting that has materially affected, or is reasonably
likely to materially affect, the Company's internal control over
financial reporting.
The Company and its consolidated subsidiaries employ
disclosure controls and procedures that are designed to ensure that
information required to be disclosed by the Company in the reports that
it files or submits under the 1934 Act is recorded, processed,
summarized and reported, within the time periods specified in the
Commission's rules and forms, and is accumulated and communicated to
the Company's management, including its principal executive officer or
officers and principal financial officer or officers, as appropriate,
to allow timely decisions regarding disclosure.
(xxiii) Compliance with the Xxxxxxxx-Xxxxx Act. There is and
has been no failure on the part of the Company or any of the Company's
directors or officers, in their capacities as such, to comply in all
material respects with any provision of the Xxxxxxxx-Xxxxx Act of 2002
and the rules and regulations promulgated in connection therewith
11
(the "Xxxxxxxx-Xxxxx Act"), including Section 402 related to loans and
Sections 302 and 906 related to certifications.
(xxiv) Pending Proceedings and Examinations. The Registration
Statement is not the subject of a pending proceeding or examination
under Section 8(d) or 8(e) of the 1933 Act, and the Company is not the
subject of a pending proceeding under Section 8A of the 1933 Act in
connection with the offering of the Securities.
(b) Officers' Certificates. Any certificate signed by any officer of
the Company or any of its subsidiaries and delivered to any Underwriter or to
counsel to the Underwriters in connection with the offering of the Underwritten
Securities and dated a Representation Date shall be deemed a representation and
warranty by the Company to each Underwriter as to the matters covered thereby on
such Representation Date.
SECTION 2. Sale and Delivery to Underwriters; Closing.
(a) Underwritten Securities. The several commitments of the
Underwriters to purchase the Underwritten Securities pursuant to the applicable
Terms Agreement shall be deemed to have been made on the basis of the
representations, warranties and agreements herein contained and shall be subject
to the terms and conditions herein set forth.
(b) Payment. Payment of the purchase price for, and delivery of, the
Underwritten Securities shall be made at the offices of Xxxxxx & Xxxxxxx LLP,
000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 or at such other place as shall be
agreed upon by the Representatives and the Company, at 10:00 A.M. (New York City
time) on the third (fourth, if the pricing occurs after 4:30 P.M. (New York City
time) on any given day) business day after the date of the applicable Terms
Agreement (unless postponed in accordance with the provisions of Section 10
hereof), or such other time not later than ten business days after such date as
shall be agreed upon by the Representatives and the Company (such time and date
of payment and delivery being herein called "Closing Time").
Payment shall be made to the Company by wire transfer of immediately
available funds to a bank account designated by the Company, against delivery to
the Representatives for the respective accounts of the Underwriters of the
Underwritten Securities to be purchased by them. It is understood that each
Underwriter has authorized the Representatives, for its account, to accept
delivery of, receipt for, and make payment of the purchase price for, the
Underwritten Securities which it has severally agreed to purchase. The
Representatives, each individually and not as representatives of the
Underwriters, may (but shall not be obligated to) make payment of the purchase
price for the Underwritten Securities to be purchased by any Underwriter whose
funds have not been received by the Closing Time, but such payment shall not
relieve such Underwriter from its obligations hereunder.
(c) Denominations; Registration. The Underwritten Securities or
certificates for the Underwritten Securities, as applicable, shall be in such
denominations and registered in such names as the Representatives may request in
writing at least one full business day prior to the Closing Time. The
Underwritten Securities or certificates for the Underwritten Securities, as
applicable, will be made available for examination and packaging by the
Representatives in The
12
City of New York not later than 2:00 P.M. (New York City time) on the business
day prior to the Closing Time.
SECTION 3. Covenants of the Company. The Company covenants
with the Representatives and with each Underwriter participating in the offering
of Underwritten Securities, as follows:
(a) Compliance with Securities Regulations and Commission Requests. The
Company, subject to Section 3(b), will comply with the requirements of Rule 430B
of the 1933 Act Regulations and will notify the Representative(s) immediately,
and confirm the notice in writing, of (i) the effectiveness of any
post-effective amendment to the Registration Statement or any new registration
statement relating to the Underwritten Securities or the filing of any
supplement or amendment to the Prospectus, (ii) the receipt of any comments from
the Commission, (iii) any request by the Commission for any amendment to the
Registration Statement or the filing of a new registration statement or any
amendment or supplement to the Prospectus or for additional information, (iv)
the issuance by the Commission of any stop order suspending the effectiveness of
the Registration Statement or such new registration statement or of any order
preventing or suspending the use of any preliminary prospectus, or of the
suspension of the qualification of the Underwritten Securities for offering or
sale in any jurisdiction, or of the initiation or threatening of any proceedings
for any of such purposes or of any examination pursuant to Section 8(e) of the
1933 Act concerning the Registration Statement and (v) if the Company becomes
the subject of a proceeding under Section 8A of the 1933 Act in connection with
the offering of the Underwritten Securities. The Company will promptly effect
the filings required under Rule 424(b), in the manner and within the time period
required by Rule 424(b) (without reliance on Rule 424(b)(8)), and will take such
steps as it deems necessary to ascertain promptly whether the Prospectus
transmitted for filing under Rule 424 was received for filing by the Commission
and, in the event that it was not, it will promptly file the Prospectus. The
Company will make every reasonable effort to prevent the issuance of any stop
order and, if any stop order is issued, to obtain the lifting thereof at the
earliest possible moment.
(b) Filing of Amendments and Exchange Act Documents; Preparation of
Final Term Sheet. The Company will give the Representatives notice of its
intention to file or prepare any amendment to the Registration Statement
(including any filing under Rule 462(b) of the 1933 Act Regulations) or any new
registration statement relating to the Underwritten Securities or any amendment,
supplement or revision to either any preliminary prospectus (including any
prospectus included in the Original Registration Statement or amendment thereto)
at the time it became effective or to the Prospectus, whether pursuant to the
1933 Act, the 1934 Act or otherwise, and the Company will furnish the
Representatives with copies of any such documents a reasonable amount of time
prior to such proposed filing or use, as the case may be, and will not file or
use any such document to which the Representatives or counsel to the
Underwriters shall reasonably object. The Company has given the Representatives
notice of any filings made pursuant to the 1934 Act or 1934 Act Regulations
within 48 hours prior to the Applicable Time; the Company will give the
Representatives notice of its intention to make any such filing from the
Applicable Time to the Closing Time and will furnish the Representatives with
copies of any such documents a reasonable amount of time prior to such proposed
filing and will not file or use any such document to which the Representatives
or counsel for the Underwriters shall reasonably object. The Company will
prepare a final term sheet (the "Final Term Sheet")
13
reflecting the final terms of the Underwritten Securities, in form and substance
satisfactory to the Representatives and substantially in the form of Annex I to
the Terms Agreement, and shall file such Final Term Sheet as an "issuer free
writing prospectus" pursuant to Rule 433 prior to the close of business two
business days after the date of the applicable Terms Agreement; provided that
the Company shall furnish the Representatives with copies of any such Final Term
Sheet a reasonable amount of time prior to such proposed filing and will not use
or file any such document to which the Representatives or counsel to the
Underwriters shall reasonably object. To the extent the distribution of
Underwritten Securities has been completed, the Company will not be required to
provide the Representatives with reports it is required to file with the
Commission under the 1934 Act.
(c) Delivery of Registration Statements. The Company has furnished or
will deliver to the Representatives and counsel to the Underwriters, without
charge, signed copies of the Original Registration Statement and of each
amendment thereto (including exhibits filed therewith or incorporated by
reference therein and documents incorporated or deemed to be incorporated by
reference therein or otherwise deemed to be part thereof) and signed copies of
all consents and certificates of experts, and will also deliver to the
Representatives, without charge, a conformed copy of the Original Registration
Statement and of each amendment thereto (without exhibits) for each of the
Underwriters. The Original Registration Statement and each amendment thereto
furnished to the Underwriters will be identical to any electronically
transmitted copies thereof filed with the Commission pursuant to XXXXX, except
to the extent permitted by Regulation S-T.
(d) Delivery of Prospectuses. The Company will deliver to each
Underwriter, without charge, as many copies of each preliminary prospectus as
such Underwriter may reasonably request, and the Company hereby consents to the
use of such copies for purposes permitted by the 1933 Act. The Company will
furnish to each Underwriter, without charge, during the period when the
Prospectus is required to be delivered under the 1933 Act or the 1934 Act, such
number of copies of the Prospectus as such Underwriter may reasonably request.
The Prospectus and any amendments or supplements thereto furnished to the
Underwriters will be identical to any electronically transmitted copies thereof
filed with the Commission pursuant to XXXXX, except to the extent permitted by
Regulation S-T.
(e) Continued Compliance with Securities Laws. The Company will comply
with the 1933 Act and the 1933 Act Regulations and the 1934 Act and the 1934 Act
Regulations so as to permit the completion of the distribution of the
Underwritten Securities as contemplated in this Underwriting Agreement and the
applicable Terms Agreement and in the Registration Statement and the Prospectus.
If at any time when the Prospectus is required by the 1933 Act or the 1934 Act
to be delivered in connection with sales of the Securities, any event shall
occur or condition shall exist as a result of which it is necessary, in the
reasonable opinion of outside counsel to the Underwriters or for the Company, to
amend the Registration Statement in order that the Registration Statement 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
not misleading or to amend or supplement the Prospectus in order that the
Prospectus will not include an untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements therein not
misleading in the light of the circumstances existing at the time it is
delivered to a purchaser, or if it shall be necessary, in the reasonable opinion
of such outside
14
counsel, at any such time to amend the Registration Statement, to file a new
registration statement, or to amend or supplement the Prospectus in order to
comply with the requirements of the 1933 Act or the 1933 Act Regulations, the
Company will (i) promptly prepare and file with the Commission, subject to
Section 3(b), such amendment, supplement or new registration statement as may be
necessary to correct such statement or omission or to comply with such
requirements, (ii) use its best efforts to have such amendment or new
registration statement declared effective as soon as practicable (if it is not
an automatic shelf registration statement with respect to the Securities), and
(iii) furnish to the Underwriters, without charge, such number of copies of such
amendment, supplement or new registration statement as the Underwriters may
reasonably request. 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 (or any other registration
statement relating to the Underwritten Securities) or the Statutory Prospectus
or any preliminary prospectus or included or would include an untrue statement
of a material fact or omitted or would omit to state a material fact necessary
in order to make the statements therein, in the light of the circumstances
prevailing at that subsequent time, not misleading, the Company will promptly
notify the Representatives and will promptly amend or supplement, at its own
expense, such Issuer Free Writing Prospectus to eliminate or correct such
conflict, untrue statement or omission.
(f) Blue Sky Qualifications. The Company will use its best efforts, in
cooperation with the Underwriters, to qualify the Underwritten Securities for
offering and sale under the applicable securities laws of such states and other
jurisdictions (domestic or foreign) as the Representatives may designate and to
maintain such qualifications in effect for a period of not less than one year
from the date of the applicable Terms Agreement; provided, however, that the
Company shall not be obligated to file any general consent to service of process
or to qualify as a foreign corporation or as a dealer in securities in any
jurisdiction in which it is not so qualified or to subject itself to taxation in
respect of doing business in any jurisdiction in which it is not otherwise so
subject. In each jurisdiction in which the Underwritten Securities have been so
qualified, the Company will file such statements and reports as may be required
by the laws of such jurisdiction to continue such qualification in effect for a
period of not less than one year from the date of such Terms Agreement.
(g) Earnings Statement. The Company will timely file such reports
pursuant to the 1934 Act as are necessary in order to make generally available
to its securityholders as soon as practicable an earnings statement for the
purposes of, and to provide to the Underwriters the benefits contemplated by,
the last paragraph of Section 11(a) of the 1933 Act.
(h) Use of Proceeds. The Company will use the net proceeds received by
it from the sale of the Underwritten Securities in the manner specified in the
Prospectus under "Use of Proceeds".
(i) Listing. The Company will use its reasonable efforts to effect the
listing of the Underwritten Securities, prior to the Closing Time, on any
national securities exchange or quotation system if and as specified in the
applicable Terms Agreement.
15
(j) Restriction on Sale of Securities. Between the date of the
applicable Terms Agreement and the Closing Time or such other date specified in
such Terms Agreement, the Company will not, without the prior written consent of
the Representatives, directly or indirectly, issue, sell, offer or contract to
sell, grant any option for the sale of, or otherwise dispose of, the securities
specified in such Terms Agreement.
(k) Reporting Requirements. The Company, during the period when the
Prospectus is required to be delivered under the 1933 Act or the 1934 Act, will
file all documents required to be filed with the Commission pursuant to the 1934
Act within the time periods required by the 1934 Act and the 1934 Act
Regulations.
(l) Issuer Free Writing Prospectuses. The Company represents and agrees
that, unless it obtains the prior consent of the Representatives, and each
Underwriter represents and agrees that, unless it obtains the prior consent of
the Company and the Representatives, it has not made and will not make any offer
relating to the Underwritten Securities that would constitute an "issuer free
writing prospectus," as defined in Rule 433, or that would otherwise constitute
a "free writing prospectus," as defined in Rule 405, required to be filed with
the Commission; provided, however, that prior to the preparation of the Final
Term Sheet in accordance with Section 3(b), the Underwriters are authorized to
use the information with respect to the final terms of the Underwritten
Securities in communications conveying information relating to the offering to
investors. Any such free writing prospectus consented to by the Company and the
Representative is hereinafter referred to as a "Permitted Free Writing
Prospectus." The Company represents that it has treated or agrees that it will
treat each Permitted Free Writing Prospectus as an "issuer free writing
prospectus," as defined in Rule 433, and has complied and will comply with the
requirements of Rule 433 applicable to any Permitted Free Writing Prospectus,
including timely filing with the Commission where required, legending and record
keeping.
SECTION 4. Payment of Expenses.
(a) Expenses. The Company will pay all expenses incident to the
performance of its obligations under this Underwriting Agreement or the
applicable Terms Agreement, including (i) the preparation, printing and filing
of the Registration Statement (including financial statements and exhibits) as
originally filed and of each amendment thereto, (ii) the preparation, printing
and delivery to the Underwriters of this Underwriting Agreement, any Terms
Agreement, any Agreement among Underwriters, the Indenture and such other
documents as may be required in connection with the offering, purchase, sale,
issuance or delivery of the Underwritten Securities, (iii) the preparation,
issuance and delivery of the Underwritten Securities and any certificates for
the Underwritten Securities, as applicable, to the Underwriters, including any
transfer taxes and any stamp or other duties payable upon the sale, issuance or
delivery of the Underwritten Securities to the Underwriters, (iv) the fees and
disbursements of the Company's counsel, accountants and other advisors or agents
(including transfer agents and registrars), as well as the fees and
disbursements of the Trustee, and their respective counsel, (v) the
qualification of the Underwritten Securities under state securities laws in
accordance with the provisions of Section 3(f) hereof, including filing fees and
the reasonable fees and disbursements of counsel to the Underwriters in
connection therewith and in connection with the preparation, printing and
delivery of the Blue Sky Survey, and any amendment thereto, (vi) the
16
printing and delivery to the Underwriters of copies of each preliminary
prospectus, any Permitted Free Writing Prospectus, and the Prospectus and any
amendments or supplements thereto and any costs associated with electronic
delivery of any of the foregoing by the Underwriters to investors, (vii) the
fees charged by nationally recognized statistical rating organizations for the
rating of the Underwritten Securities, if applicable, (viii) the fees and
expenses incurred with respect to the listing of the Underwritten Securities, if
applicable, (ix) the filing fees incident to, and the reasonable fees and
disbursements of counsel to the Underwriters in connection with, the review, if
any, by the National Association of Securities Dealers, Inc. (the "NASD") of the
terms of the sale of the Underwritten Securities, (x) the fees and expenses of
any Underwriter acting in the capacity of a "qualified independent underwriter"
(as defined in Section 20) of Schedule E of the bylaws of the NASD), if
applicable and (xi) the costs and expenses (including without limitation any
damages or other amounts payable in connection with legal or contractual
liability) associated with the reforming of any contracts for sale of the
Underwritten Securities made by the Underwriters caused by a breach of the
representation contained in the fifth paragraph of Section 1(a)(ii). Except as
set forth in clauses (v) and (ix) of this Section 4(a) or upon termination of
this Underwriting Agreement in accordance with the provisions of Section 5 or
9(b)(i) or 9(b)(iii) (only with respect to the Company's securities), the
Company shall not be obligated to pay any fees or disbursements of counsel to
the Underwriters.
(b) Termination of Agreement. If the applicable Terms Agreement is
terminated by the Representatives in accordance with the provisions of Section 5
or 9(b)(i) or 9(b)(iii) (only with respect to the Company's securities), hereof,
the Company shall reimburse the Underwriters for all of their out-of-pocket
expenses, including the reasonable fees and disbursements of counsel to the
Underwriters.
SECTION 5. Conditions of Underwriters' Obligations. The
obligations of the Underwriters to purchase and pay for the Underwritten
Securities pursuant to the applicable Terms Agreement are subject to the
accuracy of the representations and warranties of the Company contained in
Section 1 hereof or in certificates of any officer of the Company or any of its
subsidiaries delivered pursuant to the provisions hereof, to the performance by
the Company of its covenants and other obligations hereunder, and to the
following further conditions:
(a) Effectiveness of Registration Statement; Filing of Prospectus. The
Registration Statement, including any Rule 462(b) Registration Statement, has
become effective under the 1933 Act and no stop order suspending the
effectiveness of the Registration Statement shall have been issued under the
1933 Act and no proceedings for that purpose shall have been instituted or be
pending or threatened by the Commission, and any request on the part of the
Commission for additional information shall have been complied with to the
reasonable satisfaction of counsel to the Underwriters. The Prospectus
containing the Rule 430B Information relating to the description of the
Underwritten Securities, the specific method of distribution and similar matters
shall have been filed with the Commission in the manner and within the time
period required by Rule 424(b) (without reliance on Rule 424(b)(8)), as
applicable (or any required post-effective amendment providing such information
shall have been filed and become effective in accordance with the requirements
of Rule 430B).
(b) Opinions of Counsel to the Company. At Closing Time, the
Representatives shall have received the favorable opinions, dated as of Closing
Time, of (i) Xxxx Xxxxx & Xxxx PLC,
17
counsel to the Company, (ii) Executive Vice President, General Counsel and
Secretary of the Company and (iii) Xxxxxxx Brignone, Nevada counsel to the
Company, in form and substance satisfactory to counsel to the Underwriters,
together with signed or reproduced copies of such letter for each of the other
Underwriters, to the effect set forth in Annexes II, III and IV hereto,
respectively, or to the effect set forth as an Exhibit to the applicable Terms
Agreement.
(c) Opinion of Counsel to the Underwriters. At Closing Time, the
Representatives shall have received the favorable opinion reasonably
satisfactory to the Underwriters, dated as of Closing Time, of Xxxxxx & Xxxxxxx
LLP, counsel to the Underwriters, together with signed or reproduced copies of
such letter for each of the other Underwriters. In giving such opinion, such
counsel may rely, as to all matters governed by the laws of jurisdictions other
than the law of the State of New York and the federal law of the United States,
upon the opinions of counsel satisfactory to the Representatives. Such counsel
may also state that, insofar as such opinion involves factual matters, they have
relied, to the extent they deem proper, upon certificates of officers of the
Company and its subsidiaries and certificates of public officials.
(d) Officers' Certificate. At Closing Time, there shall not have been,
since the date of the applicable Terms Agreement or since the respective dates
as of which information is given in the Prospectus or the General Disclosure
Package, any material adverse change in the financial condition, earnings,
management or business affairs, or any development involving a prospective
material adverse change in the financial condition, earnings, management or
business affairs, of the Company and its subsidiaries considered as one
enterprise, whether or not arising in the ordinary course of business, and the
Representatives shall have received a certificate of the President or a Vice
President of the Company and of the chief financial officer or chief accounting
officer of the Company, dated as of Closing Time, to the effect that (i) there
has been no such material adverse change, (ii) the representations and
warranties in Section 1(a) are true and correct with the same force and effect
as though expressly made at and as of the Closing Time, (iii) 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 Time, and (iv) no stop order
suspending the effectiveness of the Registration Statement has been issued and
no proceedings for that purpose have been instituted, are pending or, to the
best of such officer's knowledge, are threatened by the Commission.
(e) Accountant's Comfort Letter. At the time of the execution of the
applicable Terms Agreement, the Representatives shall have received from Ernst &
Young LLP a letter dated such date, in form and substance satisfactory to the
Representatives, together with signed or reproduced copies of such letter for
each of the other Underwriters, containing statements and information of the
type ordinarily included in accountants' "comfort letters" to underwriters with
respect to the financial statements and certain financial information contained
in the Registration Statement and the Prospectus.
(f) Bring-down Comfort Letter. At Closing Time, the Representatives
shall have received from Ernst & Young LLP a letter, dated as of Closing Time,
to the effect that they reaffirm the statements made in the letter furnished
pursuant to subsection (e) of this Section 5, except that the specified date
referred to shall be a date not more than three business days prior to the
Closing Time.
18
(g) Ratings. At the Closing Time, the Underwritten Securities shall
have the ratings accorded by any "nationally recognized statistical rating
organization" (as defined by the Commission for purposes of Rule 436(g)(2) of
the 1933 Act Regulations) if and as specified in the applicable Terms Agreement,
and the Company shall have delivered to the Representatives a letter, dated as
of such date, from each such rating organization, or other evidence satisfactory
to the Representatives, confirming that the Underwritten Securities have such
ratings. Since the time of execution of such Terms Agreement, there shall not
have occurred a downgrading in, or withdrawal of, the rating assigned to the
Underwritten Securities or any of the Company's other securities by any such
rating organization, and no such rating organization shall have publicly
announced that it has under surveillance or review its rating of the
Underwritten Securities or any of the Company's other securities.
(h) Approval of Listing. At Closing Time, the Underwritten Securities
shall have been approved for listing, subject only to official notice of
issuance, if and as specified in the applicable Terms Agreement.
(i) No Objection. If the Registration Statement or an offering of
Underwritten Securities has been filed with the NASD for review, the NASD shall
not have raised any objection with respect to the fairness and reasonableness of
the underwriting terms and arrangements.
(j) Additional Documents. At the Closing Time, counsel to the
Underwriters shall have been furnished with such documents and opinions as they
may reasonably require for the purpose of enabling them to pass upon the
issuance and sale of the Underwritten Securities as herein contemplated, or in
order to evidence the accuracy of any of the representations or warranties, or
the fulfillment of any of the conditions, herein contained; and all proceedings
taken by the Company in connection with the issuance and sale of the
Underwritten Securities as herein contemplated shall be reasonably satisfactory
in form and substance to the Representatives and counsel to the Underwriters.
(k) Termination of Terms Agreement. If any condition specified in this
Section 5 shall not have been fulfilled when and as required to be fulfilled,
the applicable Terms Agreement may be terminated by the Representatives by
notice to the Company at any time at or prior to the Closing Time, and such
termination shall be without liability of any party to any other party except as
provided in Section 4 and except that Sections 1, 6, 7 and 8 shall survive any
such termination and remain in full force and effect.
SECTION 6. Indemnification.
(a) Indemnification of Underwriters. The Company agrees to indemnify
and hold harmless each Underwriter and each person, if any, who controls any
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act as follows:
(i) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of any untrue statement or
alleged untrue statement of a material fact contained in the
Registration Statement (or any amendment thereto), including the Rule
430B Information deemed to be a part thereof, if applicable, or the
omission or
19
alleged omission therefrom of a material fact required to be stated
therein or necessary to make the statements therein not misleading or
arising out of any untrue statement or alleged untrue statement of a
material fact included in any preliminary prospectus, any Issuer Free
Writing Prospectus or the Prospectus (or any amendment or supplement
thereto), or the omission or alleged omission therefrom of a material
fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading;
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate amount
paid in settlement of any litigation, or any investigation or
proceeding by any governmental agency or body, commenced or threatened,
or any claim whatsoever based upon any such untrue statement or
omission, or any such alleged untrue statement or omission in each case
as described in paragraph 6(a)(i) above; provided that (subject to
Section 6(d) below) any such settlement is effected with the written
consent of the Company; and
(iii) against any and all expense whatsoever, as incurred
(including the fees and disbursements of counsel chosen by the
Representatives), reasonably incurred in investigating, preparing or
defending against any litigation, or any investigation or proceeding by
any governmental agency or body, commenced or threatened, or any claim
whatsoever based upon any such untrue statement or omission, or any
such alleged untrue statement or omission, in each case as described in
paragraph 6(a)(i) above, to the extent that any such expense is not
paid under (i) or (ii) above;
provided, however, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Company by any
Underwriter through the Representatives expressly for use in the Registration
Statement (or any amendment thereto), including the Rule 430B Information or any
preliminary prospectus, any Issuer Free Writing Prospectus or the Prospectus (or
any amendment or supplement thereto).
(b) Indemnification of Company, Directors and Officers. Each
Underwriter severally agrees to indemnify and hold harmless the Company, its
directors, each of its officers who signed the Registration Statement, and each
person, if any, who controls the Company within the meaning of Section 15 of the
1933 Act or Section 20 of the 1934 Act against any and all loss, liability,
claim, damage and expense described in the indemnity contained in subsection (a)
of this Section, as incurred, but only with respect to untrue statements or
omissions, or alleged untrue statements or omissions, made in the Registration
Statement (or any amendment thereto), including the Rule 430B Information or any
preliminary prospectus, any Issuer Free Writing Prospectus, Permitted Free
Writing Prospectus or the Prospectus (or any amendment or supplement thereto) in
reliance upon and in conformity with written information furnished to the
Company by such Underwriter through the Representatives expressly for use
therein.
(c) Actions against Parties; Notification. Each indemnified party shall
give notice as promptly as reasonably practicable to each indemnifying party of
any action commenced against it in respect of which indemnity may be sought
hereunder, but failure to so notify an
20
indemnifying party shall not relieve such indemnifying party from any liability
hereunder to the extent it is not materially prejudiced as a result thereof and
in any event shall not relieve it from any liability which it may have otherwise
than on account of this indemnity agreement. In the case of parties indemnified
pursuant to Section 6(a) above, counsel to the indemnified parties shall be
selected by the Representatives, and, in the case of parties indemnified
pursuant to Section 6(b) above, counsel to the indemnified parties shall be
selected by the Company. An indemnifying party may participate at its own
expense in the defense of any such action; provided, however, that counsel to
the indemnifying party shall not (except with the consent of the indemnified
party) also be counsel to the indemnified party. In no event shall the
indemnifying parties be liable for fees and expenses of more than one counsel
(in addition to any local counsel) separate from their own counsel for all
indemnified parties in connection with any one action or separate but similar or
related actions in the same jurisdiction arising out of the same general
allegations or circumstances. No indemnifying party shall, without the prior
written consent of the indemnified parties, settle or compromise or consent to
the entry of any judgment with respect to any litigation, or any investigation
or proceeding by any governmental agency or body, commenced or threatened, or
any claim whatsoever in respect of which indemnification or contribution could
be sought under this Section 6 or Section 7 hereof (whether or not the
indemnified parties are actual or potential parties thereto), unless such
settlement, compromise or consent (i) includes an unconditional release of each
indemnified party from all liability arising out of such litigation,
investigation, proceeding or claim 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.
(d) Settlement without Consent if Failure to Reimburse. If at any time
an indemnified party shall have requested in writing an indemnifying party to
reimburse the indemnified party for fees and expenses of counsel, such
indemnifying party agrees that it shall be liable for any settlement of the
nature contemplated by Section 6(a)(ii) effected without its written consent if
(i) such settlement is entered into more than 45 days after receipt by such
indemnifying party of the aforesaid written request, (ii) such indemnifying
party shall have received notice of the terms of such settlement at least 30
days prior to such settlement being entered into and (iii) such indemnifying
party shall not have reimbursed such indemnified party in accordance with such
written request prior to the date of such settlement. Notwithstanding the
immediately preceding sentence, if at any time an indemnified party shall have
requested in writing an indemnifying party to reimburse the indemnified party
for fees and expenses of counsel, an indemnifying party shall not be liable for
any settlement of the nature contemplated by Section 6(a)(ii) effected without
its written consent if (x) such indemnifying party reimburses such indemnified
party in accordance with such request to the extent it considers such request to
be reasonable; and (y) such indemnifying party provides written notice to the
indemnified party substantiating the unpaid balance as unreasonable, in each
case prior to the date of such settlement.
SECTION 7. Contribution. If the indemnification provided for
in Section 6 hereof is for any reason unavailable to or insufficient to hold
harmless an indemnified party in respect of any losses, liabilities, claims,
damages or expenses referred to therein, then each indemnifying party shall
contribute to the aggregate amount of such losses, liabilities, claims, damages
and expenses incurred by such indemnified party, as incurred, (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Company, on the one hand, and the
21
Underwriters, on the other hand, from the offering of the Underwritten
Securities pursuant to the applicable Terms Agreement or (ii) if the allocation
provided by clause (i) is not permitted by applicable law, in such proportion as
is appropriate to reflect not only the relative benefits referred to in clause
(i) above but also the relative fault of the Company, on the one hand, and the
Underwriters, on the other hand, in connection with the statements or omissions
which resulted in such losses, liabilities, claims, damages or expenses, as well
as any other relevant equitable considerations.
The relative benefits received by the Company, on the one hand, and the
Underwriters, on the other hand, in connection with the offering of the
Underwritten Securities pursuant to the applicable Terms Agreement shall be
deemed to be in the same respective proportions as the total net proceeds from
the offering of such Underwritten Securities (before deducting expenses)
received by the Company and the total underwriting discount received by the
Underwriters, in each case as set forth on the cover of the Prospectus.
The relative fault of the Company, on the one hand, and the
Underwriters, on the other hand, shall be determined by reference to, among
other things, whether any such untrue or alleged untrue statement of a material
fact or omission or alleged omission to state a material fact relates to
information supplied by the Company or by the Underwriters and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission.
The Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 7 were determined by pro rata
allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take account of the
equitable considerations referred to above in this Section 7. The aggregate
amount of losses, liabilities, claims, damages and expenses incurred by an
indemnified party and referred to above in this Section 7 shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified
party in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue or alleged untrue
statement or omission or alleged omission.
Notwithstanding the provisions of this Section 7, no Underwriter shall
be required to contribute any amount in excess of the amount by which the total
price at which the Underwritten Securities underwritten by it and distributed to
the public were offered to the public exceeds the amount of any damages which
such Underwriter has otherwise been required to pay by reason of any such untrue
or alleged untrue statement or omission or alleged omission.
No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the 0000 Xxx) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 7, each person, if any, who controls an
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act shall have the same rights to contribution as such Underwriter, and
each director of the Company, each officer of the Company who signed the
Registration Statement, and each person, if any, who controls the
22
Company within the meaning of Section 15 of the 1933 Act or Section 20 of the
1934 Act shall have the same rights to contribution as the Company. The
Underwriters' respective obligations to contribute pursuant to this Section 7
are several in proportion to the number or aggregate principal amount, as the
case may be, of Underwritten Securities set forth opposite their respective
names in the applicable Terms Agreement, and not joint.
SECTION 8. Representations, Warranties and Agreements to
Survive Delivery. All representations, warranties and agreements contained in
this Underwriting Agreement or the applicable Terms Agreement or in certificates
of officers of the Company or any of its subsidiaries submitted pursuant hereto
or thereto shall remain operative and in full force and effect, regardless of
any investigation made by or on behalf of any Underwriter or controlling person,
or by or on behalf of the Company, and shall survive delivery of and payment for
the Underwritten Securities.
SECTION 9. Termination.
(a) Underwriting Agreement. This Underwriting Agreement (excluding the
applicable Terms Agreement) may be terminated for any reason at any time by the
Company or by either of the Representatives upon the giving of 30 days' prior
written notice of such termination to the other parties hereto.
(b) Terms Agreement. The Representatives may terminate the applicable
Terms Agreement, by notice to the Company, at any time at or prior to the
Closing Time if (i) there has been, since the time of execution of such Terms
Agreement or since the respective dates as of which information is given in the
Prospectus or the General Disclosure Package, (1) any material adverse change in
the financial condition, earnings, management or business of the Company and its
subsidiaries considered as one enterprise, whether or not arising in the
ordinary course of business, or (2) any development involving a prospective
material adverse change in or affecting the financial condition, earnings,
management or business of the Company and its subsidiaries taken as a whole,
otherwise than as set forth or contemplated in the Prospectus and the General
Disclosure Package, in any case the effect of which is such as to make it, in
the judgment of the Representatives, impracticable or inadvisable to market the
Underwritten Securities or to enforce contracts for the sale of the Underwritten
Securities, or (ii) there has occurred any material adverse change in the
financial markets in the United States or, if the Underwritten Securities
include Securities denominated or payable in, or indexed to, one or more foreign
or composite currencies, in the international financial markets, or any outbreak
of hostilities or escalation thereof a declaration of a national emergency or
war by the United States or other calamity or crisis or any material adverse
change or development involving a prospective material adverse change in
national or international political, financial or economic conditions, in each
case the effect of which is such as to make it, in the judgment of the
Representatives, impracticable or inadvisable to market the Underwritten
Securities or to enforce contracts for the sale of the Underwritten Securities,
or (iii) trading in any securities of the Company has been suspended or
materially limited by the Commission or the New York Stock Exchange, or trading
generally on the New York Stock Exchange or the over-the-counter market has been
suspended or materially limited, or minimum or maximum prices for trading have
been fixed, or maximum ranges for prices have been required, by such exchange or
by such market or by order of the Commission, the NASD or any other governmental
authority, or (iv) a banking moratorium has been declared
23
by either Federal or New York authorities or, if the Underwritten Securities
include Securities denominated or payable in, or indexed to, one or more foreign
or composite currencies, by the relevant authorities in the related foreign
country or countries or a material disruption shall have occurred in commercial
banking or securities settlement or clearance services in the United States.
(c) Liabilities. If this Underwriting Agreement or the applicable Terms
Agreement is terminated pursuant to this Section 9, such termination shall be
without liability of any party to any other party except as provided in Section
4 hereof, and provided further that Sections 1, 6, 7 and 8 shall survive such
termination and remain in full force and effect.
SECTION 10. Default by One or More of the Underwriters. If one
or more of the Underwriters shall fail at the Closing Time to purchase the
Underwritten Securities which it or they are obligated to purchase under the
applicable Terms Agreement (the "Defaulted Securities"), then the
Representatives shall have the right, within 24 hours thereafter, to make
arrangements for one or more of the non-defaulting Underwriters, or any other
underwriters, to purchase all, but not less than all, of the Defaulted
Securities in such amounts as may be agreed upon and upon the terms herein set
forth; if, however, the Representatives shall not have completed such
arrangements within such 24-hour period, then:
(a) if the number or aggregate principal amount, as the case may be, of
Defaulted Securities does not exceed 10% of the number or aggregate principal
amount, as the case may be, of Underwritten Securities to be purchased on such
date pursuant to such Terms Agreement, the non-defaulting Underwriters shall be
obligated, severally and not jointly, to purchase the full amount thereof in the
proportions that their respective underwriting obligations under such Terms
Agreement bear to the underwriting obligations of all non-defaulting
Underwriters, or
(b) if the number or aggregate principal amount, as the case may be, of
Defaulted Securities exceeds 10% of the number or aggregate principal amount, as
the case may be, of Underwritten Securities to be purchased on such date
pursuant to such Terms Agreement, such Terms Agreement shall terminate without
liability on the part of any non-defaulting Underwriter.
No action taken pursuant to this Section 10 shall relieve any
defaulting Underwriter from liability in respect of its default.
In the event of any such default which does not result in a termination
of the applicable Terms Agreement, either the Representatives or the Company
shall have the right to postpone the Closing Time for a period not exceeding
seven days in order to effect any required changes in the Registration Statement
or the Prospectus or in any other documents or arrangements.
SECTION 11. Notices. All notices and other communications
hereunder shall be in writing and shall be deemed to have been duly given if
mailed or transmitted by any standard form of telecommunication. Notices to the
Underwriters shall be directed to the Representatives c/o X.X. Xxxxxx Securities
Inc., 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Transaction
Execution Group (telecopy number (000) 000-0000), and Xxxxxxx Lynch, Pierce,
Xxxxxx & Xxxxx Incorporated, 0 Xxxxx Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Transaction Management (telecopy number (000) 000-0000); and notices
to the
24
Company shall be directed to it at 000 Xxxxx Xxxxx Xxxxxx, Xxxxxxx, Xxxxxxxxx
00000, Attention: Xxxxx X. Xxxxxxxxx, Esq., Executive Vice President, General
Counsel & Secretary (telecopy number (000) 000-0000).
SECTION 12. No Advisory or Fiduciary Relationship. The Company
acknowledges and agrees that (a) the purchase and sale of the Underwritten
Securities pursuant to this Agreement, including the determination of the public
offering price of the Underwritten Securities and any related discounts and
commissions, is an arm's-length commercial transaction between the Company, on
the one hand, and the several Underwriters, on the other hand, (b) in connection
with the offering contemplated hereby and the process leading to such
transaction each Underwriter is and has been acting solely as a principal and is
not the agent or fiduciary of the Company, or its stockholders, creditors,
employees or any other party, (c) no Underwriter has assumed or will assume an
advisory or fiduciary responsibility in favor of the Company with respect to the
offering contemplated hereby or the process leading thereto (irrespective of
whether such Underwriter has advised or is currently advising the Company on
other matters) and no Underwriter has any obligation to the Company with respect
to the offering contemplated hereby except the obligations expressly set forth
in this Agreement, (d) the 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 (e) the Underwriters have not provided any legal,
accounting, regulatory or tax advice with respect to the offering contemplated
hereby and the Company has consulted its own legal, accounting, regulatory and
tax advisors to the extent it deemed appropriate.
SECTION 13. Integration. This Agreement supersedes all prior
agreements and understandings (whether written or oral) between the Company and
the Underwriters, or any of them, with respect to the subject matter hereof.
SECTION 14. Parties. This Underwriting Agreement and the
applicable Terms Agreement shall each inure to the benefit of and be binding
upon the Company, the Representatives and, upon execution of such Terms
Agreement, any other Underwriters and their respective successors. Nothing
expressed or mentioned in this Underwriting Agreement or such Terms Agreement is
intended or shall be construed to give any person, firm or corporation, other
than the Underwriters and the Company and their respective successors and the
controlling persons and officers and directors referred to in Sections 6 and 7
and their heirs and legal representatives, any legal or equitable right, remedy
or claim under or in respect of this Underwriting Agreement or such Terms
Agreement or any provision herein or therein contained. This Underwriting
Agreement and such Terms Agreement and all conditions and provisions hereof and
thereof are intended to be for the sole and exclusive benefit of the parties
hereto and thereto and their respective successors, and said controlling persons
and officers and directors and their heirs and legal representatives, and for
the benefit of no other person, firm or corporation. No purchaser of
Underwritten Securities from any Underwriter shall be deemed to be a successor
by reason merely of such purchase.
SECTION 15. Governing Law and Time. THIS UNDERWRITING
AGREEMENT AND ANY APPLICABLE TERMS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. SPECIFIED TIMES OF DAY
REFER TO NEW YORK CITY TIME.
25
SECTION 16. Effect of Headings. The Article and Section
headings herein and the Table of Contents are for convenience only and shall not
affect the construction hereof.
[Signature Page Follows]
26
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Company a counterpart hereof, whereupon
this Underwriting Agreement, along with all counterparts, will become a binding
agreement between the Representatives and the Company in accordance with its
terms.
Very truly yours,
AUTOZONE, INC.
By: /s/ Xxxxxxx Xxxxx III
------------------------------------
Name: Xxxxxxx Xxxxx III
Title: Vice President and Controller
By: /s/ Xxxxx X. Xxxxxxxxx
------------------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: Executive Vice President,
General Counsel and Secretary
CONFIRMED AND ACCEPTED,
as of the date first above written:
X.X. XXXXXX SECURITIES INC.
By: /s/ Xxxxxx Xxxxxxxxx
-------------------------------
Name: Xxxxxx Xxxxxxxxx
Title: Vice President
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX INCORPORATED
By: /s/ Xxxxx X. Xxxx
-------------------------------
Name: Xxxxx X. Xxxx
Title: Managing Director
