Exhibit 1.1
SECURITIES
FINGERHUT COMPANIES, INC.
UNDERWRITING AGREEMENT BASIC PROVISIONS
__________, _____
1. INTRODUCTORY. Fingerhut Companies, Inc., a Minnesota
corporation (the "Company"), proposes to issue and sell from time to time its
(i) unsecured debt securities, consisting of debentures, notes and other
unsecured evidences of indebtedness in one or more series ("Debt
Securities"), (ii) shares of preferred stock, par value $.01 per share, in
one or more series, (iii) shares of common stock, par value $.01 per share,
(iv) shares of preferred stock represented by depositary shares ("Depositary
Shares"), and (v) warrants (the "Warrants") to purchase Debt Securities,
preferred stock, common stock or Depositary Shares, all of which (together
with any securities issuable upon conversion, exchange or exercise of any of
thereof) have been registered under the registration statement referred to in
Section 2(a) (such Debt Securities, preferred stock, common stock, Depositary
Shares and Warrants (together with any securities issuable upon conversion,
exchange or exercise of any of thereof) are herein collectively called
"Registered Securities"). If so specified in a Terms Agreement (as defined
below) referred to in Section 3, the Company proposes to grant to the
underwriters an option to purchase up to the amount of Registered Securities
specified in such Terms Agreement (the "Option Securities"). Debt Securities
will be issued under one or more indentures (as amended or supplemented from
time to time and including the applicable supplemental indenture entered into
on or about the Closing Date (as defined below), an "Indenture" and
collectively, the "Indentures"), more particularly described in a Terms
Agreement, between the Company and the trustee named therein (the "Trustee"),
in one or more series, which series may vary as to interest rates,
maturities, redemption provisions, selling prices and other terms, with all
such terms for any particular series of the Debt Securities being determined
at the time of sale. The preferred stock will be issued in one or more
series, which series may vary as to voting rights, dividends, optional and
mandatory redemption provisions, liquidation preference and conversion
provisions and other terms, with all such terms for any particular series or
issue of the preferred stock being determined at the time of sale.
Additional representations, warranties, covenants, conditions and other terms
related to any issue of Depositary Shares or Warrants (and any securities
issuable upon conversion, exchange or exercise thereof) will be set forth in
the Terms Agreement applicable thereto. The Registered Securities will be
sold pursuant to a Terms Agreement, for resale in accordance with terms of
offering determined at the time of sale.
The Registered Securities (including, without limitation, any
Option Securities) involved in any such offering are hereinafter referred to
as the "Securities." The firm or firms which agree to purchase the
Securities are hereinafter referred to as the "Underwriters" of
such Securities, and the representative or representatives of the
Underwriters, if any, specified in a Terms Agreement are hereinafter referred
to as the "Representatives"; provided, however, that if the Terms Agreement
does not specify any representative of the Underwriters, the term
"Representatives," as used in this Agreement, shall mean the Underwriters.
2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company
represents and warrants as of the date of this Agreement as follows:
(a) A registration statement on Form S-3 (File No. 333-_____) with
respect to the Registered Securities (i) has been prepared by the Company in
conformity with the requirements of the Securities Act of 1933, as amended
(the "Securities Act"), and the rules and regulations (the "Rules and
Regulations") of the Securities and Exchange Commission (the "Commission")
thereunder and (ii) has been filed with the Commission under the Securities
Act. Such registration statement has become effective under the Securities
Act. If any post-effective amendment to such registration statement has been
filed with the Commission prior to the date of the applicable Terms
Agreement, the most recent such amendment has been declared effective by the
Commission. Copies of such registration statement and any amendments thereto
have been delivered by the Company to the Representatives. As used in this
Agreement, "Effective Time" means the respective date and time as of which
such registration statement, or the most recent post-effective amendment
thereto, if any, was declared effective by the Commission; and "Effective
Date" means the respective applicable date of the Effective Time. As
provided in Section 4(a), a prospectus supplement relating to the Securities,
the terms of the offering thereof and the other manners set forth therein has
been prepared and will be filed pursuant to Rule 424 under the Securities
Act. In addition, a preliminary prospectus supplement reflecting the terms
of the Securities, the terms of the offering thereof, and the other matters
set forth therein also may be prepared and filed pursuant to Rule 424 under
the Securities Act. Such prospectus supplement, in the form filed on or
after the date of this Agreement pursuant to Rule 424, is referred to in this
Agreement as the "Prospectus Supplement," and any such preliminary prospectus
supplement in the form filed after the date of this Agreement pursuant to
Rule 424 is referred to as the "Preliminary Prospectus Supplement." Any
prospectus accompanied by a Preliminary Prospectus Supplement is referred to
in this Agreement, collectively with such Preliminary Prospectus Supplement,
as a "Preliminary Prospectus." The registration statement referred to in
this Section 2(a), as amended at the time of execution and delivery of the
Terms Agreement, including the exhibits thereto (but excluding the Statement
of Qualification and Eligibility ("Form T-1") and the documents filed by the
Company with the Commission pursuant to the Securities Exchange Act of 1934,
as amended (the "Exchange Act"), that are incorporated by reference therein
pursuant to Item 12 of Form S-3 under the Securities Act (the "Incorporated
Documents") and the information, if any, deemed to be a part of the
registration statement pursuant to Rule 430A(b) under the Securities Act, is
called the "Registration Statement"; and the basic prospectus included
therein relating to all offerings of securities under the Registration
Statement, as supplemented by the Prospectus Supplement, is called the
"Prospectus," except that, if such basic prospectus is amended or
supplemented on or prior to the date on which the Prospectus Supplement is
first filed pursuant to Rule 424, the term "Prospectus" shall refer to the
basic prospectus as so amended or supplemented and as
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supplemented by the Prospectus Supplement, in either case including the
Incorporated Documents. Notwithstanding the foregoing, any prospectus
supplement prepared or filed with respect to an offering pursuant to the
Registration Statement of securities other than the Securities shall not be
deemed to have supplemented the Prospectus. The Commission has not issued
any order suspending the effectiveness of the Registration Statement, and no
such stop order has been initiated or threatened by the Commission.
(b) On the Effective Date, the Registration Statement conformed in
all material respects to the requirements of the Securities Act and the Rules
and Regulations, and did 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; and on the date of the
applicable Terms Agreement, and at the time of filing of the Prospectus
pursuant to Rule 424(b) under the Securities Act, the Prospectus will conform
in all material respects to the requirements of the Securities Act and the
Rules and Regulations, 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; and on the Effective Date and the Closing Date,
respectively, the Indenture, if any, described in the Terms Agreement
conformed and will conform in all material respects with the requirements of
the Trust Indenture Act of 1939, as amended (the "Trust Indenture Act"), and
the applicable rules and regulations thereunder; provided that no
representation or warranty is made as to (i) information contained in or
omitted from the Registration Statement or the Prospectus in reliance upon
and in conformity with written information furnished to the Company through
the Representatives by or on behalf of any Underwriter specifically for
inclusion therein or (ii) that part of the Registration Statement which shall
constitute the Form T-1 under the Trust Indenture Act.
(c) KPMG Peat Marwick LLP, who have certified the financial
statements and supporting schedules included in the Registration Statement,
are independent public accountants as required by the Securities Act and the
Rules and Regulations.
(d) Subsequent to the respective dates as of which information is
given in the Registration Statement and the Prospectus, except as set forth
in the Registration Statement and the Prospectus, there has been no material
adverse change or any development involving a prospective material adverse
change in the business, prospects, properties, operations, condition
(financial or other), net worth or results of operations of the Company and
its subsidiaries taken as a whole, whether or not arising from transactions
in the ordinary course of business, (such change or development involving a
prospective change, a "Material Adverse Change") and since the date of the
latest balance sheet included or incorporated by reference in the
Registration Statement and the Prospectus, neither the Company nor any of its
subsidiaries has incurred or undertaken any liabilities or obligations,
direct or contingent, which are material to the Company and its subsidiaries
taken as a whole, except for liabilities or obligations which are reflected
in the Registration Statement and the Prospectus.
(e) The execution, delivery and performance of the Terms Agreement
(including the provisions of this Agreement) by the Company and the
consummation of the
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transactions contemplated thereby and hereby, and compliance by the Company
with the provisions of the Indenture, if any, described in the Terms
Agreement and the Securities, have been duly and validly authorized by the
Company, and this Agreement has been duly and validly executed and delivered
by the Company.
(f) The execution, delivery and performance of the Terms Agreement
(including the provisions of this Agreement) by the Company and the
consummation of the transactions contemplated thereby and hereby and
compliance by the Company with the provisions of the Indenture, if any,
described in the Terms Agreement and the Securities do not and will not (i)
conflict with or result in a breach of any of the terms and provisions of, or
constitute a default (or an event which with notice or lapse of time, or
both, would constitute a default) under, or result in the creation or
imposition of any lien, charge or encumbrance upon any property or assets of
the Company or any of its subsidiaries pursuant to, any agreement,
instrument, franchise, license or permit to which the Company or any of its
subsidiaries is a party or by which the Company or any of its subsidiaries or
their respective properties or assets may be bound or (ii) violate or
conflict with any provision of the articles of incorporation or by-laws of
the Company or any of its subsidiaries or any judgment, decree, order,
statute, rule or regulation of any court or any public, governmental or
regulatory agency or body having jurisdiction over the Company or any of its
subsidiaries or any of their respective properties or assets. No consent,
approval, authorization, order, registration, filing, qualification, license
or permit of or with any court or any public, governmental or regulatory
agency or body having jurisdiction over the Company or any of its
subsidiaries or any of their respective properties or assets is required for
the execution, delivery and performance of the Terms Agreement (including the
provisions of this Agreement) by the Company and the consummation of the
transactions contemplated thereby and hereby, and compliance by the Company
with the provisions of the Indenture, if any, described in the Terms
Agreement and the Securities, including the issuance, sale and delivery of
the Securities to be issued, sold and delivered by the Company hereunder,
except the registration under the Securities Act of the Securities and such
consents, approvals, authorizations, orders, registrations, filings,
qualifications, licenses and permits as may be required under state
securities or Blue Sky laws in connection with the purchase and distribution
of the Securities by the Underwriters.
(g) All of the outstanding shares of common stock are duly and
validly authorized and issued, fully paid and non-assessable and were not
issued and are not now in violation of or subject to any preemptive rights.
The common stock and preferred stock, if any, described in the Terms
Agreement have been duly authorized by the Company and, when issued and paid
for pursuant to the Terms Agreement, will be duly and validly issued, fully
paid and non-assessable and will not be issued in violation of or be subject
to any preemptive rights. The Company had, at __________, _____, an
authorized and outstanding Capitalization as set forth in the Registration
Statement and the Prospectus. The common stock and the preferred stock, if
any, described in the Terms Agreement conform to the descriptions thereof
contained in the Registration Statement and the Prospectus.
(h) Each of the Company and each of its subsidiaries (as defined
in Rule 405 of the Rules and Regulations) has been duly organized and is
validly existing as a corporation
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in good standing under the laws of its jurisdiction of incorporation. Each
of the Company and its subsidiaries is duly qualified and in good standing as
a foreign corporation in each jurisdiction in which the character or location
of its properties (owned, leased or licensed) or the nature or conduct of its
business makes such qualification necessary, except for those failures to be
so qualified or in good standing which will not in the aggregate have a
material adverse effect on the business, prospects, properties, assets,
operations, condition (financial or other), net worth or results of
operations of the Company and its subsidiaries taken as a whole (a "Material
Adverse Effect"). Each of the Company and its subsidiaries has all requisite
power and authority, and all necessary consents, approvals, authorizations,
orders, registrations, qualifications, licenses and permits of and from all
public, regulatory or governmental agencies and bodies, to own, lease and
operate its properties and conduct its business as now being conducted and as
described in the Registration Statement and the Prospectus, and no such
consent, approval, authorization, order, registration, qualification, license
or permit contains a materially burdensome restriction not adequately
disclosed in the Registration Statement and the Prospectus. Each of the
Company and its subsidiaries has (i) good and marketable title to all of the
properties and assets described in the Prospectus as owned by it, free and
clear of all liens, charges, encumbrances and restrictions (except for taxes
not yet payable and as described in the Prospectus) and (ii) peaceful and
undisturbed possession under all material leases to which any of them is a
party as lessee and each of which lease is valid and binding and no default
exists thereunder, except for defaults that could not reasonably be expected
to have a Material Adverse Effect. All material leases to which the Company
or any of its subsidiaries is a party are valid and binding and no default by
the Company or such subsidiary, as the case may be, has occurred and is
continuing thereunder and, to the best knowledge of the Company, no material
defaults by the landlord are existing under any such lease, except those
defaults that could not reasonably be expected to have a Material Adverse
Effect. All of the issued shares of capital stock of each significant
subsidiary of the Company have been duly and validly authorized and issued
and are fully paid, non-assessable and are owned directly or indirectly by
the Company, free and clear of all liens, encumbrances, equities, claims,
security interests, restrictions on transfer, stockholders' agreements,
voting trusts or other defects in title. None of the subsidiaries of the
Company, other than those so identified in the Terms Agreement, is a
"significant subsidiary," as such term is defined in Rule 405 of the Rules
and Regulations.
(i) The Indenture, if any, described in the Terms Agreement has
been duly authorized, executed and delivered by the Company and (assuming the
due authorization, execution and delivery thereof by the Trustee under the
Indenture) constitutes the valid and legally binding obligation of the
Company, enforceable against the Company in accordance with its terms.
(j) The Debt Securities, if any, described in the Terms Agreement
have been duly authorized by the Company and, when the terms of the Debt
Securities and of their issuance and sale have been duly established in
accordance with the Indenture, the Terms Agreement (including the provisions
of this Agreement) and the Debt Securities have been duly executed,
authenticated, issued and delivered in the manner provided in the Indenture
and paid for in accordance with the Terms Agreement (including the provisions
of this Agreement), the
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Debt Securities will be duly and validly issued and delivered by the Company
and will constitute valid and legally binding obligations of the Company,
enforceable against the Company in accordance with their terms and entitled
to the benefits of the Indenture; if any Securities to be issued are
convertible, the shares of common stock issuable upon conversion thereof have
been duly authorized by the Company, have been duly reserved for issuance
upon conversion of the Securities and, when issued upon the conversion of the
Securities, will be duly and validly issued, fully paid and non-assessable;
no further approval or authority of the stockholders or the Board of
Directors of the Company will be required for the issuance and sale of the
Securities as contemplated herein or the issuance of the shares of common
stock upon conversion of the Securities; and the Debt Securities and the
Indenture, if any, described in the Terms Agreement and the common stock of
the Company issuable upon conversion of such Debt Securities, if any, will
conform to the descriptions thereof contained in the Registration Statement
and the Prospectus.
(k) Except as described in the Prospectus, there is no litigation
or governmental proceeding to which the Company or any of its subsidiaries is
a party or to which any property of the Company or any of its subsidiaries is
subject or which is pending or, to the best knowledge of the Company,
contemplated against the Company or any of its subsidiaries which would
reasonably be expected to result in a Material Adverse Change or which is
required to be disclosed in the Registration Statement and the Prospectus;
and to the actual knowledge of the Company, no such proceedings are
threatened by governmental authorities or by others.
(l) The Company has not taken and will not take, directly or
indirectly, any action designed to cause or result in, or which constitutes
or which might reasonably be expected to constitute, the stabilization or
manipulation of the price of the Securities to facilitate the sale or resale
of the Securities.
(m) The financial statements, including the notes thereto, and
supporting schedules included in the Registration Statement and the
Prospectus present fairly the financial position of the Company as of the
dates indicated and the results of its operations for the periods specified;
except as otherwise stated in the Registration Statement and the Prospectus,
said financial statements have been prepared in conformity with generally
accepted accounting principles applied on a consistent basis; and the
supporting schedules, if any, included in the Registration Statement and
Prospectus present fairly the information required to be stated therein.
(n) Except as described in the Prospectus, no holder of securities
of the Company has any rights to the registration of securities of the
Company because of the filing of the Registration Statement or otherwise in
connection with the sale of the Securities contemplated in the Terms
Agreement. Immediately after the sale of the Securities by the Company under
the Terms Agreement, the aggregate amount of Securities which shall have been
issued and sold by the Company under the Terms Agreement and of any other
securities of the Company (other than the Securities) that shall have been
issued and sold pursuant to the
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Registration Statement will not exceed the amount of Securities registered
under the Registration Statement.
(q) The documents incorporated or deemed to be incorporated by
reference in the Prospectus, 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 Exchange Act and the rules and regulations of the
Commission under the Exchange Act, and, when read together with the other
information in the Prospectus, at the time the Registration Statement and any
amendments thereto become effective and at the Closing Date, will not contain
an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein, in
the light of the circumstances under which they were made, not misleading.
(r) Neither the Company nor any of its subsidiaries nor, to the
Company's best knowledge, any other party, is now, or is reasonably expected
by the Company or any of its subsidiaries to be, (i) in violation or breach
of, or default (disregarding any grace or notice provision), with respect to
any material provision of any contract, agreement, instrument, lease,
license, policy, arrangement, or understanding to which the Company or any of
its subsidiaries is a party or will become a party in connection with the
transactions contemplated hereby, (ii) in violation of any provision of its
articles of incorporation or by-laws, or (iii) in violation of any law,
ordinance, governmental rule, regulation or court decree to which it or its
property or assets may be subject or has failed to obtain any license,
permit, certificate, franchise or other governmental authorization or permit
necessary to the ownership of its property or to the conduct of its business,
which violation, breach or default or violations, breaches or defaults, in
the case of clause (i) or (iii), singly or in the aggregate has, or would
reasonably be expected in the future to have, a Material Adverse Effect; and
each such contract, agreement, instrument, lease, license, policy,
arrangement and understanding is in full force and effect and is the legal,
valid and binding obligation of the Company or its subsidiaries, as the case
may be, and to the Company's best knowledge, the other parties thereto, and
is enforceable as to the Company or its subsidiaries, as the case may be, and
to the Company's best knowledge, the other parties thereto in accordance with
its terms subject, as to enforceability, to applicable bankruptcy,
reorganization, moratorium or other similar laws of general application
affecting the rights of creditors generally, except where such failure to be
in full force and effect or to be a legal, valid and binding obligation or to
be enforceable, as the case may be, has not had, or would not reasonably be
expected in the future to have, a Material Adverse Effect.
(s) The Company has no reason to believe that the Company and each
of its subsidiaries do not own or possess adequate rights to use all material
patents, patent applications, trademarks, service marks, trade names,
trademark registrations, service xxxx registrations, copyrights and licenses
necessary for the conduct of their respective businesses in the manner
described in the Prospectus and have no reason to believe that the conduct of
their respective businesses will conflict with any such rights of others.
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(t) There are no contracts or other documents which are required
to be filed as exhibits to the Registration Statement by the Securities Act
or by the Rules and Regulations which have not been filed as exhibits to the
Registration Statement.
(u) Except as described in the Prospectus, since the date as of
which information is given in the Prospectus, the Company has not (i) issued
or granted any rights to acquire any securities (other than pursuant to
employee benefit plans or other compensation plans existing on the date of
the Terms Agreement) or (ii) declared or paid any dividend on its capital
stock other than regular quarterly cash dividends.
(v) Neither the Company nor any of its subsidiaries is, nor upon
consummation of the transactions contemplated hereby will be, required to
register as, or be subject to regulation as, an "investment company" under
the Investment Company Act of 1940, as amended, or a "broker" within the
meaning of Section 3(a)(4) of the Exchange Act, or a "dealer" within the
meaning of Section 3(a)(5) of the Exchange Act, or required to be registered
pursuant to Section 15(a) of the Exchange Act.
(w) The conditions for use of Form S-3, as set forth in the
General Instructions thereto, have been satisfied.
(x) The Company has (i) initiated a review and assessment of all
areas within its and each of its subsidiaries' business and operations
(including those affected by suppliers, vendors and customers) that could be
adversely affected by the "Year 2000 Problem" (that is, the risk that
computer applications used by the Company or any of its subsidiaries (or
suppliers, vendors and customers) may be unable to recognize and perform
properly date-sensitive functions involving certain dates prior to and any
date after December 31, 1999), (ii) developed a plan and timeline for
addressing the Year 2000 Problem on a timely basis and (iii) to date, has
implemented that plan in accordance with that timetable. Based on the
foregoing, the Company believes that all computer applications (including
those of the Company's suppliers, vendors and customers) that are material to
its or any of its subsidiaries' business and operations are reasonably
expected on a timely basis to be able to perform properly date-sensitive
functions for all dates before and after January 1, 2000 (that is, be "Year
2000 Compliant"), except to the extent that a failure to do so could not
reasonably be expected to have Material Adverse Effect.
3. PURCHASE AND OFFERING OF THE SECURITIES BY THE UNDERWRITERS.
The obligation of the Underwriters to purchase the Securities will be
evidenced by an exchange of written communications (including, without
limitation, facsimile transmissions) ("Terms Agreement") at each time the
Company determines to sell the Securities. Unless otherwise agreed by the
parties thereto, each Terms Agreement will be in the form of Annex II(A) or
(B) attached hereto and will incorporate by reference the provisions of this
Agreement, except as otherwise provided therein, and will specify the firm or
firms which will be Underwriters, the names of any Representatives, the
amount to be purchased by each Underwriter, the purchase price to be paid by
the Underwriters and certain terms of the Securities and whether any of the
Securities may be sold to institutional investors pursuant to Delayed
Delivery Contracts (as
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defined below). The Terms Agreement will also specify the time and date of
delivery and payment (such time and date being herein and in the Terms
Agreement referred to as the "Closing Date"), the place of delivery and
payment and any details of the terms of any public offering that should be
reflected in the Prospectus Supplement relating to the offering of the
Securities. The obligations of the Underwriters to purchase the Securities
will be several and not joint. It is understood that the Underwriters
propose to offer the Securities for sale as set forth in the Prospectus.
Debt Securities, if any, delivered to the Underwriters on the Closing Date
will be in definitive fully registered form, in such denominations and
registered in such names as the Underwriters may request.
If specified in a Terms Agreement, on the basis of the
representations, warranties and covenants contained in this Agreement, and
subject to the terms and conditions set forth in this Agreement, the Company
grants an option to the several Underwriters to purchase, severally and not
jointly, up to that amount of the Option Securities as shall be specified in
the Terms Agreement from the Company at the same price as the Underwriters
shall pay for the Securities which the Underwriters are committed to purchase
on the Closing Date (the "Firm Securities"). Said option may be exercised
only to cover over-allotments in the sale of the Firm Securities by the
Underwriters and may be exercised in whole or in part at any time and from
time to time on or before the thirtieth day after the date of the Terms
Agreement upon written or telegraphic notice by the Representatives to the
Company setting forth the amount of the Option Securities as to which the
several Underwriters are exercising the option. The amount of Option
Securities to be purchased by each Underwriter in connection with each
exercise of such option shall be the same percentage of the total amount of
the Option Securities to be purchased by the several Underwriters as such
Underwriter is purchasing of the Firm Securities, as adjusted by the
Representatives in such manner as the Representatives deem advisable to avoid
fractional shares or units.
If the Terms Agreement provides for sales of Securities pursuant to
delayed delivery contracts, the Company authorizes the Underwriters to
solicit offers to purchase Securities pursuant to delayed delivery contracts
substantially in the form of Annex I attached hereto ("Delayed Delivery
Contracts") with such changes therein as the Company may authorize or
approve. Delayed Delivery Contracts are to be made only with institutional
investors, including commercial and savings banks, insurance companies
pension funds, investment companies and educational and charitable
institutions. On the Closing Date, the Company will pay, as compensation, to
the Representatives for the accounts of the Underwriters, the fee set forth
in such Terms Agreement in respect of the amount of Securities to be sold
pursuant to Delayed Delivery Contracts ("Contract Securities"). The
Underwriters will not have any responsibility in respect of the validity or
the performance of Delayed Delivery Contracts. If the Company executes and
delivers Delayed Delivery Contracts, the Contract Securities will be deducted
from the Securities to be purchased by the several Underwriters and the
aggregate amount of Securities to be purchased by each Underwriter will be
reduced pro rata in proportion to the amount of Securities set forth opposite
each Underwriter's name in such Terms Agreement, except to the extent that
the Representatives determine that such reduction shall be otherwise than pro
rata and so advise the Company.
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The Company will advise the Representatives not later than the business day
prior to the Closing Date of the amount of Contract Securities.
4. COVENANTS OF THE COMPANY. The Company covenants and agrees
with the Underwriters as follows:
(a) The Company agrees: (i) to prepare the Prospectus in a form
approved by the Representatives and to file such Prospectus, including the
Prospectus Supplement, pursuant to Rule 424(b) within the time period
prescribed by the Rules and Regulations; (ii) to notify the Representatives,
promptly after it receives notice, of the time when the Registration
Statement or any amendment thereto becomes effective or promptly after the
filing of any supplement or amendment to the Prospectus (other than any
Incorporated Document or any amendment or supplement relating to an offering
of securities other than the Securities) and to furnish the Representatives
with copies thereof; (iii) to notify the Representatives, promptly after it
receives notice thereof, of the issuance by the Commission of any stop order
or of any order preventing or suspending the use of any Preliminary
Prospectus or the Prospectus, of the suspension of the qualification of the
Securities for offering or sale in any jurisdiction, of the initiation or
threatening of any proceeding for any such purpose, or of any request by the
Commission for the amending or supplementing of the Registration Statement or
the Prospectus or for additional information; and, in the event of the
issuance of any stop order or of any order preventing or suspending the use
of any Preliminary Prospectus or the Prospectus or suspending any such
qualification, to use promptly its best efforts to obtain its withdrawal; and
(iv) not to file any amendment to the Registration Statement or any amendment
of or supplement to the Prospectus (including the prospectus required to be
filed pursuant to Rule 424(b)) that differs from the prospectus on file at
the time of the effectiveness of the Registration Statement or file any
document under the Exchange Act if such document would be deemed to be
incorporated by reference into the Prospectus to which the Representatives
shall reasonably object in writing after being timely furnished in advance a
copy thereof.
(b) If at any time when a Prospectus relating to the Securities is
required to be delivered under the Securities Act any event shall have
occurred as a result of which the Prospectus as then amended or supplemented
would, in the judgment of the Underwriters or the Company include an untrue
statement of a material factor or omit to state any material fact required to
be state therein or necessary to make the statements therein, in the light of
the circumstances under which they were made, not misleading, or if it shall
be necessary at any time to amend or supplement the Prospectus or
Registration Statement to comply with the Securities Act or the Rules and
Regulations, or to file under the Exchange Act, so as to comply with the
Exchange Act or the Securities Act, any document incorporated by reference in
the Registration Statement or the Prospectus or in any amendment thereof or
supplement thereto, the Company will notify the Representatives promptly and
prepare and file with the Commission an appropriate amendment or supplement
(in form and substance satisfactory to the Representatives) which will
correct such misstatement or omission or which will effect such compliance
and will use its best efforts to have any amendment to the Registration
Statement declared effective as soon as possible.
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(c) The Company will promptly deliver to the Representatives two
signed copies of the Registration Statement, including exhibits and all
documents incorporated by reference therein and all amendments thereto, and
the Company will promptly deliver to each of the Underwriters such number of
copies of any Preliminary Prospectus, the Prospectus, the Registration
Statement, and all amendments of and supplements to such documents, if any,
and all documents incorporated by reference in the Registration Statement and
Prospectus or any amendment thereof or supplement thereto, without exhibits,
as the Representatives may reasonably request.
(d) The Company will endeavor in good faith, in cooperation with
the Representatives, at or prior to the time of effectiveness of the
Registration Statement, to qualify the Securities for offering and sale under
the securities laws of such jurisdictions as the Representatives may
designate and to maintain such qualification in effect for so long as
required for the distribution thereof; except that in no event shall the
Company be obligated in connection therewith to qualify as a foreign
corporation or to execute a general consent to service of process.
(e) As soon as practicable but no later than 16 months after the
date of each Terms Agreement, the Company will make generally available to
its securityholders an earning statement of the Company and its subsidiaries
(which need not be audited) complying with Section 11(a) of the Securities
Act (including, at the option of the Company, Rule 158) covering a period of
at least 12 months beginning on the first day of the first fiscal quarter of
the Company commencing after the later of (i) the effective date of the
Registration Statement, (ii) the effective date of the most recent
post-effective amendment to the Registration Statement to become effective
prior to the date of such Terms Agreement or (iii) the date of the Company's
most recent Annual Report on Form 10-K filed with the Commission prior to the
date of such Terms Agreement.
(f) For the period specified in the Terms Agreement, the Company,
(A) in the event of an offering of common stock, preferred stock or
convertible debt securities, (x) will not (i) offer for sale, sell or
otherwise dispose of, directly or indirectly, any shares of common stock of
the Company or permit registration under the Securities Act of any shares of
common stock of the Company (other than the Securities and shares issued
pursuant to employee benefit plans, qualified stock option plans or other
employee compensation plans), (ii) sell or grant options, rights or warrants
with respect to any shares of common stock of the Company (other than the
Securities and the grant of options pursuant to employee benefit plans), or
(iii) offer for sale, sell or otherwise dispose of, directly or indirectly,
any securities convertible into or, exchangeable or exercisable for common
stock of the Company (other than the Securities) and (y) will obtain the
agreement of the persons, if any, specified in the Terms Agreement not to
offer for sale, sell or otherwise dispose of, directly or indirectly, any
shares of common stock of the Company, without, in any case, the prior
written consent of the Representatives; and, (B) in the event of an offering
of Debt Securities, will not, between the date of the Terms Agreement and the
date of delivery of the Debt Securities, offer for sale, sell or cause to be
offered for sale or sold, without the prior written consent of the
Representatives, any debt securities which are substantially similar to the
Debt Securities.
11
(g) During the period, if any, specified in the Terms Agreement
after the date of such Terms Agreement, the Company will furnish to the
Representatives copies of (i) all reports to its stockholders; and (ii) all
reports, financial statements and proxy or information statements filed by
the Company with the Commission or any national securities exchange or
quotation system.
(h) The Company will apply the proceeds from the sale of the
Securities as set forth under "Use of Proceeds" in the Prospectus.
(i) If the Securities include shares of common stock or securities
convertible into shares of common stock, the Company will cause such shares
to be listed on the New York Stock Exchange.
(k) The Company, during the period when the Prospectus is required
to be delivered under the Securities Act or the Exchange Act, will file all
documents required to be filed with the Commission pursuant to Section 13, 14
or 15 of the Exchange Act within the time periods required by the Exchange
Act and the rules and regulations thereunder.
5. PAYMENT OF EXPENSES. Whether or not the transactions
contemplated by any Terms Agreement are consummated or such Terms Agreement
is terminated, the Company hereby agrees to pay all costs and expenses
incident to the performance of the obligations of the Company under such
Terms Agreement (including the provisions of this Agreement), including,
without limitation, (i) costs and expenses of preparing, printing,
duplicating, filing and distributing the Registration Statement, as
originally filed and all amendments thereof (including all exhibits thereto),
any Preliminary Prospectus, the Prospectus and any amendments or supplements
thereto (including, without limitation, fees and expenses of the Company's
accountants and counsel), any Incorporated Documents and any amendments or
supplements thereto, the underwriting documents (including this Agreement,
and any Agreement Among Underwriters and Selling Agreement) and all other
documents related to the public offering of the Securities (including those
supplied to the Underwriters in quantities as hereinabove stated); (ii) costs
and expenses in connection with the issuance, transfer and delivery of the
Securities to the Underwriters, including any transfer or other taxes payable
thereon; (iii) costs and expenses in connection with the qualification of the
Securities under state or foreign securities or Blue Sky laws, including the
costs of printing and mailing a preliminary and/or final "blue sky survey"
and fees of counsel for the Underwriters and such counsel's disbursements in
relation thereto; (iv) fees and expenses in connection with listing shares of
common stock, and other Securities, if any, on the New York Stock Exchange or
other securities exchange or quotation system, as the case may be; (v) filing
fees of the Commission and the National Association of Securities Dealers,
Inc. (the "NASD"), if any; (vi) the cost of printing certificates
representing the Securities; (vii) the fees paid to rating agencies in
connection with the rating of the Securities; (viii) the reasonable fees and
disbursements of the Trustee and any transfer agent and their respective
counsel; and (ix) all other reasonable costs and expenses incident to the
performance of the obligations of the Company under the Terms Agreement
(including the provisions of this Agreement).
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6. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The obligations of
the Underwriters to purchase and pay for the Securities as provided herein,
shall be subject to the accuracy of the representations and warranties of the
Company herein contained, as of the date of the applicable Terms Agreement
and as of the Closing Date (for purposes of this Section 6 "Closing Date"
shall refer to the Closing Date for the Firm Securities and the date of
delivery, if different, for any Option Securities), to the absence from any
certificates, opinions, written statements or letters furnished to the
Representatives or to Cadwalader, Xxxxxxxxxx & Xxxx ("Underwriters' Counsel")
pursuant to this Section 6 of any misstatement or omission to state a
material fact, to the performance by the Company of its obligations
hereunder, and to the following additional conditions:
(a) The Prospectus as amended or supplemented shall have been
filed with the Commission pursuant to Rule 424(b) under the Securities Act
within the applicable time period prescribed for such filing by the Rules and
Regulations and in accordance with Section 4(a); no stop order suspending the
effectiveness of the Registration Statement or any part thereof shall have
been issued and no proceeding for that purpose shall have been initiated or
threatened by the Commission; and any request of the Commission for inclusion
of additional information in the Registration Statement or the Prospectus or
otherwise shall have been complied with. No Underwriter shall have
discovered and disclosed to the Company on or prior to the Closing Date that
the Registration Statement or the Prospectus or any amendment or supplement
thereto contains an untrue statement of a fact which, in the opinion of
Underwriters' Counsel is material or omits to state a fact which, in the
opinion of such counsel, is material and is required to be stated therein or
is necessary to make the statements therein not misleading.
(b) At the Closing Date, the Representatives shall have received
the opinion of Faegre & Xxxxxx LLP, counsel for the Company, and/or Xxxxxxx
X. Xxxxxxx, Esq., Senior Vice President, Business Development, General
Counsel and Secretary of the Company, dated the Closing Date addressed to the
Underwriters and in form and substance satisfactory to Underwriters' Counsel,
to the effect that:
(i) Each of the Company and its subsidiaries has been duly
incorporated and is validly existing as a corporation in good standing
under the laws of its jurisdiction of incorporation. Each of the Company
and its subsidiaries is duly qualified and in good standing as a foreign
corporation in each jurisdiction in which the character or location of its
properties (owned, leased or licensed) or the nature or conduct of its
business makes such qualification necessary, except for those failures to
be so qualified or in good standing which would not in the aggregate be
reasonably expected to have a Material Adverse Effect. Each of the Company
and its subsidiaries has the corporate power to own, lease and license its
respective properties and conduct its business as now being conducted and
as described in the Registration Statement and the Prospectus. All of the
outstanding shares of capital stock of each subsidiary of the Company have
been duly and validly authorized and issued and are fully paid and
non-assessable and were not issued in violation of or subject to any
preemptive rights, and are owned directly or indirectly by the Company,
free and clear of any lien,
13
encumbrance, claim, security interest, restriction on transfer,
stockholders' agreement, voting trust or other defect of title whatsoever.
(ii) The authorized and outstanding capital stock of the Company
is as set forth in the Registration Statement and the Prospectus. All of
the outstanding shares of capital stock of the Company are duly and validly
authorized and issued, fully paid and non-assessable and were not issued in
violation of or subject to any preemptive rights.
(iii) The shares of common stock and preferred stock, if any,
of the Company described in the Terms Agreement have been duly authorized
by the Company and, when issued and paid for pursuant to the Terms
Agreement, will be duly and validly issued, fully paid and non-assessable
and will not have been issued in violation of or be subject to any
preemptive rights.
(iv) The Indenture, if any, described in the Terms Agreement has
been duly authorized, executed and delivered by the Company and (assuming
the due authorization, execution and delivery thereof by the Trustee under
the Indenture) constitutes the valid and legally binding obligation of the
Company, enforceable against the Company in accordance with its terms.
(v) The Debt Securities, if any, described in the Terms
Agreement have been duly authorized by the Company and, when the terms of
the Debt Securities and of their issuance and sale have been duly
established in accordance with the Indenture, this Agreement and the Terms
Agreement, and the Debt Securities have been duly executed, authenticated,
issued and delivered in the manner provided in the Indenture and paid for
in accordance with this Agreement and the Terms Agreement, the Debt
Securities will be duly and validly issued and delivered by the Company and
will constitute valid and legally binding obligations of the Company,
enforceable against the Company in accordance with their terms and entitled
to the benefits of the Indenture; if any Securities to be issued are
convertible, the shares of common stock issuable upon conversion thereof
have been duly authorized by the Company, have been duly reserved for
issuance upon conversion of the Securities and, when issued upon the
conversion of the Securities, will be duly and validly issued, fully paid
and non-assessable and will not have been issued in violation of or subject
to any preemptive rights.
(vi) The Securities, other than any Contract Securities, the
Indenture and the capital stock of the Company conform, and any Contract
Securities, when issued, delivered and sold, will conform, in all material
respects to the descriptions thereof contained or incorporated by reference
in the Registration Statement and the Prospectus; and the provisions of the
contracts, agreements and instruments (as the same may be in effect on the
Closing Date) summarized in the Prospectus, any supplement thereto or any
document incorporated by reference therein, conform in all
14
material respects to the descriptions thereof in the Prospectus, any
supplement thereto or any document incorporated by reference therein;
(vii) The Company has the corporate power to execute, deliver
and perform its obligations under the Terms Agreement, this Agreement and
any Delayed Delivery Contracts and to consummate the transactions
contemplated hereby and thereby, and the Terms Agreement, this Agreement
and any Delayed Delivery Contracts have been duly authorized, executed and
delivered by the Company.
(viii) There is no litigation or governmental proceeding to
which the Company or any of its subsidiaries is a party, or to which any
property of the Company or any of its subsidiaries is subject, which is
pending or, to the best of such counsel's knowledge, threatened against the
Company or any of its subsidiaries, which is of a character required to be
disclosed in the Registration Statement and the Prospectus which has not
been properly disclosed therein.
(ix) The execution, delivery and performance of the Terms
Agreement (including the provisions of this Agreement) by the Company and
the consummation of the transactions contemplated thereby and hereby and
compliance by the Company with the provisions of the Indenture, if any,
described in the Terms Agreement and the Securities, including the
issuance, sale and delivery of the Securities to be issued, sold and
delivered by the Company on the Closing Date, do not and will not (i)
conflict with or result in a breach of any of the terms and provisions of,
or constitute a default (or any event which with notice or lapse of time,
or both, would constitute a default) under, or result in the creation or
imposition of any lien, charge or encumbrance upon any property or assets
of the Company or any of its subsidiaries pursuant to, any agreement,
instrument, franchise, license or permit to which the Company or any of its
subsidiaries is a party or by which the Company or any of its subsidiaries
or any of their respective properties or assets may be bound or (ii)
violate or conflict with any provisions of the articles of incorporation or
by-laws of the Company or any of its subsidiaries or any judgment, decree,
order, statute, rule or regulation of any court or any public, governmental
or regulatory agency or body having jurisdiction over the Company or any of
its subsidiaries or any of their respective properties or assets.
(x) No consent, approval, authorization, order, registration,
filing, qualification, license or permit of or with any court or any
public, governmental or regulatory agency or body having jurisdiction over
the Company or any of its subsidiaries or any of their respective
properties or assets is required for the execution, delivery and
performance of the Terms Agreement (including the provisions of this
Agreement) by the Company and the consummation of the transactions
contemplated thereby and hereby and compliance by the Company which the
provisions of the Indenture, if any, described in the Terms Agreement and
the Securities, including the issuance, sale and delivery of the Securities
to be issued, sold and delivered by the Company on the Closing Date, except
the registration under the Securities Act of the
15
Securities and such consents, approvals, authorizations, orders,
registrations, filings, qualifications, licenses and permits as may be
required under state securities or Blue Sky laws in connection with the
purchase and distribution of the Securities by the Underwriters.
(xi) To the best of such counsel's knowledge, neither the
Company nor any of its subsidiaries is (i) in violation or breach of, or
default (disregarding any grace or notice provision) with respect to any
material provision of any contract, agreement, instrument, lease, license
or permit known to such counsel to which the Company or any of its
subsidiaries is a party, or (ii) in violation of any law, ordinance,
governmental rule, regulation or court decree to which the Company or any
of its subsidiaries or their respective properties or assets may be
subject, which violations, breaches or defaults, in the case of clause
(i) or (ii), singly or in the aggregate, have or can reasonably be
expected in the future to have, a Material Adverse Effect.
(xii) At the Effective Time, the Registration Statement
(including all documents incorporated by reference therein) complied, and
on the date of the Terms Agreement, the Prospectus (including all documents
incorporated by reference therein) complies, and any further amendments or
supplements thereto made by the Company on or prior to the date of such
opinion comply (other than, in each case, the financial statements and
related schedules and other financial and statistical data included or
incorporated by reference therein and the Form T-1 under the Trust
Indenture Act, as to which such counsel need express no opinion) as to form
in all material respects with the requirements of the Securities Act, the
Exchange Act and the applicable rules and regulations thereunder.
(xiii) To the best of such counsel's knowledge, there are no
contracts or other documents which are required to be filed as exhibits to
the Registration Statement by the Securities Act or by the Rules and
Regulations which have not been so filed.
(xiv) The Registration Statement is effective under the
Securities Act, and, to the best of such counsel's knowledge, no stop
order suspending the effectiveness of the Registration Statement or any
post-effective amendment thereof has been issued and no proceedings
therefor have been initiated or threatened by the Commission and all
filings required by Rule 424(b) of the Rules and Regulations have been
made.
(xv) To the best of such counsel's knowledge, there are no
contracts, agreements or understandings between the Company and any person
granting such person the right to require the Company to include any
securities owned or to be owned by such person in the securities registered
pursuant to the Registration Statement, or, except as described in the
Prospectus or Schedule B to the Terms Agreement, to require the Company to
file any other registration statement under the Securities Act (other than
a registration statement on Form S-8) with respect to any securities of the
16
Company owned or to be owned by such person or to require the Company to
include such securities in any securities being registered pursuant to any
other registration statement filed by the Company under the Securities Act.
(xvi) Neither the Company nor any of its subsidiaries is, nor
upon consummation of the transactions contemplated hereby will be, required
to be registered as, or subject to regulation as, an "investment company"
under the Investment Company Act of 1940, as amended, or a "broker" within
the meaning of Section 3(a)(4) of the Exchange Act, or a "dealer" within
the meaning of Section 3(a)(5) of the Exchange Act, or required to be
registered pursuant to Section 15(a) of the Exchange Act.
(xvii) The statements in the Prospectus under the captions
[list relevant sections of Prospectus] insofar as such statements
constitute matters of law, summaries of legal matters, the Company's
charter or bylaw provisions, legal documents or legal proceedings, or legal
conclusions, have been reviewed by such counsel and, as of the date of the
Prospectus and as of the date hereof, fairly present and summarize, in all
material respects, the matters referred to therein.
In addition, such opinion shall also contain a statement that
such counsel has participated in conferences with officers and
representatives of the Company, representatives of KPMG Peat Marwick LLP,
the Underwriters and Underwriters' Counsel at which the contents of the
Registration Statement and the Prospectus and related matters were
discussed, and no facts have come to the attention of such counsel which
would lead such counsel to believe that either the Registration
Statement, as of the Effective Time, or, if later, as of the date of the
Company's most recent filing of an Annual Report on Form 10-K (including
such Annual Report on Form 10-K), contained or any amendment thereof made
prior to the Closing Date, as of the date of such amendment, contained an
untrue statement of a material fact or omitted to state any material fact
required to be stated therein or necessary to make the statements therein
not misleading or that the Prospectus as of its date (or any amendment
thereof or supplement thereto made prior to the Closing Date, as of the
date of such amendment or supplement) and as of the Closing Date,
contained or contains an untrue statement of a material fact or omitted
or omits to state any material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading (it being understood that such
counsel need express no belief or opinion with respect to the financial
statements and schedules and other financial or statistical data included
or incorporated by reference therein).
In rendering such opinion, such counsel may rely (A) as to matters
involving the application of laws other than the laws of the United States and
jurisdictions in which they are admitted, to the extent such counsel deems
proper and to the extent specified in such opinion, if at all, upon an opinion
or opinions (in form and substance reasonably satisfactory to Underwriters'
Counsel) of other counsel reasonably acceptable to Underwriters' Counsel,
familiar with the applicable laws and (B) as to matters of fact, to the extent
they deem proper, on certificates of responsible officers of the Company and
certificates or other written
17
statements of officers of departments of various jurisdictions having
custody of documents respecting the corporate existence or good standing
of the Company and its subsidiaries, provided that copies of any such
statements or certificates shall be delivered to Underwriters' Counsel.
The opinion of such counsel for the Company shall state that the opinion
of any such other counsel is in form satisfactory to such counsel and, in
the opinion of such counsel to the Company, the Representatives and they
are justified in relying thereon. Counsel for the Company may also state
that their opinions set forth in subparagraphs (iv) and (v) above are
subject to the qualification that the enforceability of the Company's
obligations under the Indenture and the Securities may be limited by
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium
and other similar laws relating to or affecting creditors' rights
generally, general equitable principles (whether considered in a
proceeding in equity or at law) or by an implied covenant of good faith
and fair dealing.
(c) All corporate proceedings and other legal matters incident
to the authorization, form and validity of this Agreement, the Terms
Agreement, the Indenture, if any, described in the Terms Agreement, the
Securities, the Registration Statement and the Prospectus, and all other
legal matters relating to this Agreement and the Terms Agreement and the
transactions contemplated hereby and thereby shall be satisfactory in all
material respects to the Representatives and Underwriters' Counsel; and
the Underwriters shall have received from said Underwriters' Counsel a
favorable opinion, dated as of the Closing Date with respect to the
issuance and sale of the Securities, the Registration Statement and the
Prospectus and such other related matters as the Representatives may
reasonably require, and the Company shall have furnished to Underwriters'
Counsel such documents as they request for the purpose of enabling them
to pass upon such matters.
(d) At the Closing Date, the Representatives shall have
received a certificate of the Chairman of the Board, Chief Executive
Officer, President, Chief Operating Officer or any Vice President and the
principal financial officer of the Company, dated the Closing Date to the
effect that (i) the conditions set forth in subsection (a) of this
Section 6 have been satisfied, (ii) as of the date hereof and as of the
Closing Date, the representations and warranties of the Company set forth
in this Agreement are true and correct in all material respects, (iii) as
of the Closing Date, all obligations and conditions to be performed or
complied with by the Company on or prior thereto have been duly performed
or complied with in all material respects, (iv) they have examined the
Registration Statement and the Prospectus and, in their opinion, (A) as
of the Effective Date, the Registration Statement did not contain an
untrue statement of a material fact and did not omit to state a material
fact required to be stated therein or necessary to make the statements
therein not misleading, and, as of the date of such certificate, the
Prospectus does 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, and (B) since the Effective Date no event has occurred
which should have been set forth in a supplement or amendment to the
Registration Statement or Prospectus which has not been set forth in such
a supplement or amendment, and (v) subsequent to the respective dates as
of which information is given in the Registration Statement and the
Prospectus, the Company or its subsidiaries have not sustained any
material loss or interference with their respective businesses or
properties from fire, flood,
18
hurricane, accident or other calamity, whether or not covered by
insurance, or from any labor dispute or any legal or governmental
proceeding, and there has not been a Material Adverse Change,except in
each case as described in or contemplated by the Prospectus.
(e) At the time this Agreement is executed and at the Closing
Date, the Representatives shall have received a letter from KPMG Peat
Marwick LLP, independent public accountants for the Company, dated,
respectively, as of the date of the Terms Agreement and as of the Closing
Date addressed to the Underwriters and in form and substance satisfactory
to the Representatives, in each case of the type described in the
American Institute of Certified Public Accountants' Statement on Auditing
Standards No. 72, and covering such additional financial statement items
and procedures (including a review of interim financial statements
specified in the American Institute of Certified Public Accountants'
Statement on Auditing Standards No. 71) as the Representatives may
reasonably request, and each such letter shall further state:
(i) whether, with respect to the period subsequent to the date
of the most recent consolidated balance sheet of the Company and its
subsidiaries included or incorporated by reference in the Registration
Statement and the Prospectus there have been, as of the date of the most
recent available monthly consolidated financial statements of the Company
and its subsidiaries, if any, and as of a specified date not more than five
days prior to the date of such letter, any changes in the capital stock or
consolidated long-term indebtedness of the Company or any decrease in the
consolidated net current assets or stockholders' equity of the Company, in
each case as compared with the amounts shown in the most recent balance
sheet included or incorporated by reference in the Registration Statement
and the Prospectus, except for changes or decreases which the Registration
Statement and the Prospectus disclose have occurred or may occur or which
are set forth in such letter or whether during the period from the date of
the most recent consolidated balance sheet of the Company and its
subsidiaries included or incorporated by reference in the Registration
Statement and the Prospectus to the date of the most recent available
monthly consolidated financial statements of the Company and its
subsidiaries, if any, and to a specified date not more than five days prior
to the date of such letter, there were any decreases, as compared with the
corresponding period in the preceding fiscal year, in total revenues, or in
total or per share net income, except for decreases which the Registration
Statement and the Prospectus disclose have occurred or may occur or which
are set forth in such letter; and
(ii) their conclusions with respect to specific dollar amounts,
numbers of shares, percentages of revenues and earnings, and other
financial information pertaining to the Company and its subsidiaries set
forth or incorporated by reference in the Registration Statement and the
Prospectus, which have been specified by the Representatives prior to the
date of the Terms Agreement.
19
(f) Prior to the Closing Date the Company shall have furnished to
the Representatives such further information, certificates and documents as
the Representatives may reasonably request.
(g) At the Closing Date, any shares of common stock included in or
issuable upon conversion of the Securities shall have been approved for
listing on the New York Stock Exchange upon notice of issuance and all the
then outstanding shares of common stock of the Company shall be listed on the
New York Stock Exchange.
If any of the conditions specified in this Section 6 shall not have
been fulfilled when and as required by this Agreement, or if any of the
certificates, opinions, written statements or letters furnished to the
Representatives or to Underwriters' Counsel pursuant to this Section 6 shall
not be in all material respects reasonably satisfactory in form and substance
to the Representatives and to Underwriters' Counsel, all obligations of the
Underwriters hereunder may be cancelled by the Representatives at, or at any
time prior to, the Closing Date and the obligations of the Underwriters to
purchase the Option Securities may be cancelled by the Representatives at, or
at any time prior to, the agreed upon date of delivery thereof. Notice of
such cancellation shall be given to the Company in writing, or by telephone,
telex, telegraph or facsimile, confirmed in writing.
All opinions, letters, evidence and certificates mentioned above or
elsewhere in this Agreement shall be deemed to be in compliance with the
provisions hereof only if they are in form and substance reasonably
satisfactory to Underwriters' Counsel.
7. INDEMNIFICATION AND CONTRIBUTION.
(a) The Company agrees to indemnify and hold harmless each
Underwriter and each person, if any, who controls any Underwriter within the
meaning of Section 15 of the Securities Act or Section 20(a) of the Exchange
Act against any and all losses, liabilities, claims, damages and expenses
whatsoever as incurred (including, without limitation, attorneys' fees and
any and all expenses whatsoever incurred in investigating, preparing or
defending against any litigation, commenced or threatened, or any claim
whatsoever, and any and all amounts paid in settlement of any claim or
litigation), joint or several, to which they or any of them may become
subject under the Securities Act, the Exchange Act or otherwise, insofar as
such losses, liabilities, claims, damages or expenses (or actions in respect
thereof) arise out of or are based upon any untrue statement or alleged
untrue statement of a material fact contained in the Registration Statement,
any Preliminary Prospectus or the Prospectus, or in any supplement thereto or
amendment thereof, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading; provided, however,
that the Company will not be liable in any such case to the extent but only
to the extent that any such loss, liability, claim, damage or expense arises
out of or is based upon any such untrue statement or alleged untrue statement
or omission or alleged omission made in the Registration Statement, any
Preliminary Prospectus or the Prospectus or in any such supplement or
amendment in reliance upon and in conformity with written information
furnished to the Company by or on behalf of any Underwriter through the
Representatives expressly for use therein. This indemnity agreement
20
will be in addition to any liability which the Company may otherwise have,
including under this Agreement.
(b) Each Underwriter, severally and not jointly, agrees to
indemnify and hold harmless the Company, each of the directors of the
Company, each of the officers of the Company who shall have signed the
Registration Statement, and each other person, if any, who controls the
Company within the meaning of Section 15 of the Securities Act or Section
20(a) of the Exchange Act, against any losses, liabilities, claims, damages
and expenses whatsoever as incurred (including, without limitation,
attorneys' fees and any and all expenses whatsoever incurred in
investigating, preparing or defending against any litigation, commenced or
threatened, or any claim whatsoever, and any and all amounts paid in
settlement of any claim or litigation), joint or several, to which they or
any of them may become subject under the Securities Act, the Exchange Act or
otherwise, insofar as such losses, liabilities, claims, damages or expenses
(or actions in respect thereof) arise out of or are based upon any untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement, any Preliminary Prospectus or the Prospectus, or in
any amendment thereof or supplement thereto, or arise out of or are based
upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, in each case to the extent, but only to the extent, that any such
loss, liability, claim, damage or expense arises out of or is based upon any
such untrue statement or alleged untrue statement or omission or alleged
omission made in the Registration Statement, any Preliminary Prospectus or
the Prospectus or in any such amendment or supplement, in reliance upon and
in conformity with written information furnished to the Company by or on
behalf of any Underwriter through the Representatives expressly for use
therein; provided, however, that in no case shall any Underwriter be liable
or responsible for any amount in excess of the underwriting discount
applicable to the Securities purchased by such Underwriter under the Terms
Agreement. This indemnity will be in addition to any liability which any
Underwriter may otherwise have, including under this Agreement.
(c) Promptly after receipt by an indemnified party under
subsection (a) or (b) above of notice of the commencement of any action, such
indemnified party shall, if a claim in respect thereof is to be made against
the indemnifying party under such subsection, notify each party against whom
indemnification is to be sought in writing of the commencement thereof (but
the failure so to notify an indemnifying party shall not relieve it from any
liability which it may have under this Section 7). In case any such action
is brought against any indemnified party, and it notifies an indemnifying
party of the commencement thereof, the indemnifying party will be entitled to
participate therein, and to the extent it may elect by written notice
delivered to the indemnified party promptly after receiving the aforesaid
notice from such indemnified party, to assume the defense thereof with
counsel satisfactory to such indemnified party. Notwithstanding the
foregoing, the indemnified party or parties shall have the right to employ
its or their own counsel in any such case, but the fees and expenses of such
counsel shall be at the expense of such indemnified party or parties unless
(i) the employment of such counsel shall have been authorized in writing by
one of the indemnifying parties in connection with the defense of such
action, (ii) the indemnifying parties shall not have employed counsel to have
charge of the defense of such action within a reasonable time
21
after notice of commencement of the action, or (iii) such indemnified party
or parties shall have reasonably concluded that there may be defenses
available to it or them which are different from or additional to those
available to one or all of the indemnifying parties (in which case the
indemnifying parties shall not have the right to direct the defense of such
action on behalf of the indemnified party or parties), in any of which events
such fees and expenses shall be borne by the indemnifying parties. Anything
in this subsection to the contrary notwithstanding, an indemnifing party
shall not be liable for any settlement of any claim or action effected
without its written consent; provided, however, that such consent was not
unreasonably withheld.
(d) In order to provide for contribution in circumstances in which
the indemnification provided for in this Section 7 is for any reason held to
be unavailable from any indemnifying party or is insufficient to hold
harmless a party indemnified thereunder, each indemnifying party shall
contribute to the aggregate losses, claims, damages, liabilities and expenses
of the nature contemplated by such indemnification provision (including any
investigation, legal and other expenses incurred in connection with, and any
amount paid in settlement of, any action, suit or proceeding or any claims
asserted, but after deducting in the case of losses, claims, damages,
liabilities and expenses suffered by the Company any contribution received by
the Company from persons, other than the Underwriters, who may also be liable
for contribution, including persons who control the Company within the
meaning of Section 15 of the Securities Act or Section 20(a) of the Exchange
Act, officers of the Company who signed the Registration Statement and
directors of the Company) as incurred to which the Company and one or more of
the Underwriters may be subject, in such proportions as is appropriate to
reflect the relative benefits received by the Company and the Underwriters
from the offering of the Securities or, if such allocation is not permitted
by applicable law or indemnification is not available as a result of the
indemnifying party not having received notice as provided in this Section 7,
in such proportion as is appropriate to reflect not only the relative
benefits referred to above but also the relative fault of the Company and the
Underwriters in connection with the statements or omissions which resulted in
such losses, claims, damages, liabilities or expenses, as well as any other
relevant equitable considerations. The relative benefits received by the
Company and the Underwriters shall be deemed to be in the same proportion as
(x) the total proceeds from the offering (net of underwriting discounts and
commissions but before deducting epenses) received by the Company and (y) the
underwriting discounts and commissions received by the Underwriters,
respectively, in each case as set forth in the Prospectus. The relative
fault of the Company and of the Underwriters shall be determined by reference
to, among other things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company or 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(d) 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. Notwithstanding the provisions of this
Section 7(d), (i) in no case shall the liability or responsibility of any
Underwriter to indemnify or contribute under this Section 7 exceed the
22
lesser of (x) the underwriting discount or commission applicable to the
Securities purchased by such Underwriter under the Terms Agreement, or (y)
the amount by which the total price at which the Securities underwritten by
it and distributed to the public were offered to the public exceeds the
amount of any damages that such Underwriter has otherwise been required to
pay by reason of such untrue or alleged untrue statement or omission or
alleged omission, and (ii) no person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) shall be entitled
to contribution from any person who was not guilty of such fraudulent
misrepresentation. For purposes of this Section 7(d), each person, if any,
who controls an Underwriter within the meaning of Section 15 of the
Securities Act or Section 20(a) of the Exchange Act shall have the same
rights to contribution as such Underwriter, and each person, if any, who
controls the Company within the meaning of Section 15 of the Securities Act
or Section 20(a) of the Exchange Act, each officer of the Company who shall
have signed the Registration Statement and each director of the Company shall
have the same rights to contribution as the Company, subject in each case to
clauses (i) and (ii) of this Section 7(d). Any party entitled to
contribution will, promptly after receipt of notice of commencemen of any
action, suit or proceeding against such party in respect of which a claim for
contribution may be made against another party or parties, notify each party
or parties from whom contribution may be sought, but the omission to so
notify such party or parties shall not relieve the party or parties from whom
contribution may be sought from any obligation it or they may have under this
Section 7(d) or otherwise. No party shall be liable for contribution with
respect to any action or claim settled without its consent; provided, however
that such consent was not unreasonably withheld.
(e) The Underwriters severally confirm that the statements with
respect to the public offering of the Securities set forth on the cover page
of, and under the caption "Underwriting" in, the Prospectus are correct and
constitute the only information furnished in writing to the Company by or on
behalf of the Underwriters specifically for inclusion in the Registration
Statement and the Prospectus.
(f) The agreements contained in Sections 4(e), 4(g), 5 and this
Section 7 and the representations and warranties of the Company in Section 2
(as made as of the date of the Terms Agreement incorporating this Agreement)
shall survive the delivery of the Securities and shall remain in full force
and effect, regardless of any termination or cancellation of the Terms
Agreement incorporating the terms of this Agreement or any investigation made
by or on behalf of any indemnified party.
8. DEFAULT BY AN UNDERWRITER.
(a) If any Underwriter or Underwriters shall default in its or
their obligation to purchase Securities under the Terms Agreement, and if the
Securities with respect to which such default relates do not (after giving
effect to arrangements, if any, made by the Representatives pursuant to
subsection (b) below) exceed in the aggregate 10% of the number of shares or
aggregate principal amount, as the case may be, of the Firm Securities or
Option Securities, as the case may be, then the Firm Securities or Option
Securities, as the case may be, to which the default relates shall be
purchased by the non-defaulting Underwriters in the
23
respective proportions which the number of shares or principal amount of Firm
Securities set forth opposite their respective names in the schedule attached
to the Terms Agreement bears to the aggregate number of shares or aggregate
principal amount of Firm Securities set forth opposite the names of all
non-defaulting Underwriters.
(b) In the event that such default relates to more than 10% of the
aggregate number of shares or aggregate principal amount, as the case may be,
of Firm Securities or Option Securities, as the case may be, the
Representatives may in their discretion arrange for the Underwriters or for
another party or parties (including any non-defaulting Underwriter or
Underwriters who so agree) to purchase such Firm Securities or Option
Securities to which such default relates on the terms contained herein. In
the event that within five calendar days after such a default the
Representatives do not arrange for the purchase of the Firm Securities or
Option Securities, as the case may be, to which such default relates as
provided in this Section 8, the Terms Agreement or, in the case of a default
with respect to the Option Securities, the obligations of the Underwriters to
purchase and of the Company to sell the Option Securities shall thereupon
terminate, without liability on the part of the Company with respect thereto
(except in each case as provided in Sections 5, 7(a), 7(c) and 7(d) hereof)
or the Underwriters, but nothing in this Agreement shall relieve a defaulting
Underwriter or Underwriters of its or their liability, if any, to the other
Underwriters and the Company for damages occasioned by its or their default
hereunder.
(c) In the event that the Firm Securities or Option Securities to
which the default relates are to be purchased by the non-defaulting
Underwriters, or are to be purchased by another party or parties as
aforesaid, the Representatives or the Company shall have the right to
postpone the Closing Date or date of delivery of the Option Securities, as
the case may be, for a period, not exceeding five business days, in order to
effect whatever changes may thereby be made necessary in the Registration
Statement or the Prospectus or in any other documents and arrangements, and
the Company agrees to file promptly any amendment or supplement to the
Registration Statement or the Prospectus which, in the opinion of
Underwriters' Counsel, may thereby be made necessary or advisable. The term
"Underwriter" as used in the Terms Agreement (including this Agreement) shall
include any party substituted under this Section 8 with like effect as if it
had originally been a party to the Terms Agreement with respect to such Firm
Securities or Option Securities.
9. SURVIVAL OF REPRESENTATIONS AND AGREEMENTS. All
representations and warranties, covenants and agreements of the Underwriters
and the Company contained in the Terms Agreement (including the provisions of
this Agreement), including the agreements contained in Section 5, the
indemnity agreements contained in Section 7 and the contribution agreements
contained in Section 7, shall remain operative and in full force and effect
regardless of any investigation made by or on behalf of any Underwriter or
any controlling person thereof or by or on behalf of the Company, any of its
officers and directors or any controlling person thereof, and shall survive
delivery of and payment for the Firm Securities and any Option Securities to
and by the Underwriters. The representations contained in Section 2 and the
agreements contained in Sections 4(e), 4(g), 5, 7, and 10(c) hereof shall
24
survive the termination of this Agreement, including termination pursuant to
Section 8 or 10 hereof.
10. EFFECTIVE DATE AND TERMINATION.
(a) The Representatives shall have the right to terminate the
Terms Agreement at any time prior to the Closing Date or the obligations
of the Underwriters to purchase the Option Securities at any time prior
to the agreed upon date of delivery thereof, as the case may be:
(i) if, subsequent to the respective dates as of which
information is given in the Registration Statement and the Prospectus, the
Company or its subsidiaries shall have sustained any material loss or
interference with their respective businesses or properties from fire,
flood, hurricane, accident or other calamity, whether or not covered by
insurance, or from any labor dispute or any legal or governmental
proceeding, or there shall have been a Material Adverse Change, except in
each case as described in or contemplated by the Prospectus; or
(ii) if (A) any domestic or international event or act or
occurrence shall have materially disrupted, or in the opinion of the
Representatives will in the immediate future materially disrupt, the market
for the Company's securities or securities in general, (B) trading on the
New York Stock Exchange, the American Stock Exchange or the Nasdaq National
Market shall have been suspended, or minimum or maximum prices for trading
shall have been fixed, or maximum ranges for prices for securities shall
have been required, on either such exchange or the Nasdaq National Market
by either such exchange, by the NASD or by order of the Commission or any
other governmental authority having jurisdiction or (C) a banking
moratorium shall have been declared by a state or federal authority or any
new restriction materially adversely affecting the distribution of the Firm
Securities or the Option Securities shall have become effective; or
(iii) if (A) any downgrading in the rating of the Company's
debt securities or preferred stock by any "nationally recognized
statistical rating organization" (as defined for purposes of Rule 436(g)
under the Securities Act) shall occur or (B) any such organization shall
have publicly announced that it has under surveillance or review, with
possible negative implications, its rating of any of the Company's debt
securities or preferred stock; or
(iv) if (A) the United States shall become engaged in
hostilities or there shall be an escalation of hostilities involving the
United States or there shall be a declaration of a national emergency or
war by the United States or (B) there shall have been a change in
political, financial or economic conditions, and the effect of any such
event in (A) or (B) is such as to make it in the sole judgment of the
Representatives impracticable or inadvisable to proceed with the
offering, sale and delivery of the Firm Securities or the Option
Securities on the terms contemplated by the Prospectus.
25
(b) Any notice of termination pursuant to this Section 10 shall be
by hand delivery, telephone (confirmed in writing) or facsimile transmission.
(c) If the Terms Agreement shall be terminated pursuant to any of
the provisions thereof or hereof (otherwise than pursuant to Section 8(b)
hereof), or if the sale of the Securities provided for herein is not
consummated because any condition to the obligations of the Underwriters set
forth herein is not satisfied or because of any refusal, inability or failure
on the part of the Company to perform any agreement herein or comply with any
provision hereof, the Company will, upon demand by the Representatives,
reimburse the underwriters for all out-of-pocket expenses (including the fees
and expenses of Underwriters' Counsel), incurred by the Underwriters in
connection herewith.
11. NOTICES, ETC. All communications hereunder, except as may be
otherwise specifically provided herein, shall be in writing and, if sent to
any Underwriter, shall be hand delivered, or sent by facsimile transmission,
to such Underwriter, in care of the Representatives at the address specified
in the Terms Agreement; if sent to the Company, shall be hand delivered or
sent by facsimile transmission to Fingerhut Companies, Inc., 0000 Xxxxx Xxxx,
Xxxxxxxxxx, Xxxxxxxxx 00000, facsimile: (000) 000-0000, Attention: General
Counsel; provided, however, that any notice to an Underwriter pursuant to
Section 7(c) shall be given to such Underwriter at its address set forth in
its acceptance to the Representatives, which address will be supplied to any
other party hereto by the Representatives upon request. Any such statements,
requests, notices or agreements shall take effect at the time of receipt
thereof.
12. PARTIES. The Terms Agreement (including the provisions of
this Agreement) shall inure to the benefit of and be binding upon the
Underwriters and the Company and their respective successors. The Terms
Agreement (including the provisions of this Agreement) are for the sole
benefit of only those persons, except that (A) the representations,
warranties, indemnities and agreements of the Company contained in this
Agreement also shall be deemed to be for the benefit of the person or
persons, if any, who control any Underwriter within the meaning of Section 15
of the Securities Act or Section 20(a) of the Exchange Act and (B) the
indemnity agreement of the Underwriters contained in Section 7(b) of this
Agreement shall be deemed to be for the benefit of directors of the Company,
officers of the Company who have signed the Registration Statement and any
person controlling the Company within the meaning of Section 15 of the
Securities Act or Section 20(a) of the Exchange Act. Nothing in this
Agreement is intended or shall be construed to give any person, other than
the persons referred to in this Section 12, any legal or equitable right,
remedy or claim under or in respect of this Agreement or any provision
contained in this Agreement. No purchaser of Securities from any Underwriter
shall be deemed to be a successor solely by reason of such purchase.
13. GOVERNING LAW. THIS AGREEMENT AND THE TERMS AGREEMENT SHALL
BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK, WITHOUT REGARD TO THE CONFLICTS OF LAW PRINCIPLES THEREOF.
26
14. DEFINITION OF THE TERM "BUSINESS DAY." For purposes of this
Agreement, "business day" means any day on which the New York Stock Exchange
is open for trading.
15. COUNTERPARTS. The Terms Agreement may be executed in
counterparts and each such counterpart shall be deemed to be an original but
all such counterparts shall together constitute one and the same instrument.
16. HEADINGS. The headings herein are inserted for convenience of
reference only and are not intended to be part of, or to affect the meaning
or interpretation of, this Agreement.
27
ANNEX I
(Three copies of this Delayed Delivery Contract should be signed and returned
to the address shown below so as to arrive not later than 9:00 a.m., New York
City time, on __________, _____. [three business days prior to Closing Date
under the Terms Agreement])
DELAYED DELIVERY CONTRACT
[Date of Public Offering]
FINGERHUT COMPANIES, INC.
c/o [NAMES OF REPRESENTATIVES]
[On behalf of [themselves] [itself] and
as Representative[s] of the several] [As]
Underwriter[s]
[c/o Name of Lead Manager]
-----------------------
-----------------------
Ladies and Gentlemen:
The undersigned hereby agrees to purchase from Fingerhut Companies,
Inc., a Minnesota corporation (the "Company"), and the Company agrees to sell
to the undersigned as of the date hereof for delivery on the dates set forth
below (each a "Delivery Date") the principal amount set forth opposite each
Delivery Date of the Company's [Title of Securities] (the "Securities"),
offered by the Company's Prospectus dated __________, _____ and a Prospectus
Supplement dated __________, _____ relating thereto, receipt of copies of
which is hereby acknowledged, at _____% of the principal amount thereof plus
accrued interest from __________, _____, if any, and on the further terms and
conditions soft forth in this Delayed Delivery Contract (this "Contract"):
DELIVERY DATE PRINCIPAL AMOUNT
$
-------------- --------------
$
-------------- --------------
Payment for the Securities that the undersigned has agreed to
purchase for delivery on [the] [each] Delivery Date shall be made to the
Company or its order by certified or official bank check in New York
[Clearing House (next day)] [Federal (same day)] funds at the office of
__________ at 10:00 a.m., New York City time, on the Delivery Date upon
delivery to the undersigned of the Securities to be purchased by the
undersigned for delivery on such Delivery Date in definitive fully registered
form and in such denominations and
I-1
registered in such names as the undersigned may designate by written or
telegraphic communication addressed to the Company not less than five full
business days prior to such Delivery Date.
It is expressly agreed that the provisions for delayed delivery and
payment are for the sole convenience of the undersigned; that the purchase
hereunder of Securities is to be regarded in all respects as a purchase as of
the date of this Contract; that the obligation of the Company to make
delivery of and accept payment for, and the obligation of the undersigned to
take delivery of and make payment for, Securities on [the] [each] Delivery
Date shall be subject only to the conditions that (1) investment in the
Securities shall not at such Delivery Date be prohibited under the laws of
any jurisdiction in the United States to which the undersigned is subject and
(2) the Company shall have sold to the Underwriters the total principal
amount of the Securities less the principal amount thereof covered by this
and other similar Contracts. The undersigned represents that its investment
in the Securities is not, as of the date hereof, prohibited under the laws of
any jurisdiction to which the undersigned is subject and which governs such
investment.
Promptly after completion of the sale to the Underwriters, the
Company will mail or deliver to the undersigned at its address set forth
below, notice to such effect, accompanied by a copy of the opinion of counsel
for the Company delivered to the Underwriters in connection therewith.
This Contract will inure to the benefit of and be binding upon the
parties hereto and their respective successors, but will not be assignable by
either party hereto without the written consent of the other.
I-2
It is understood that the acceptance of any such Contract is in the
Company's sole discretion and, without limiting the foregoing, need not be on
a first-come, first-served basis. If this Contract is acceptable to the
Company, it is requested that the Company sign the form of acceptance below
and mail or deliver one of the counterparts hereof to the undersigned at its
address set forth below. This will become a binding contract between the
Company and the undersigned when such counterpart is so mailed or delivered.
Very truly yours,
------------------------------------
(Name of Purchaser)
By:
---------------------------------
(Title of Signatory)
------------------------------------
------------------------------------
(Address of Purchaser)
Accepted, as of the above date,
FINGERHUT COMPANIES, INC.
By:
---------------------------------
Name:
Title:
I-3
ANNEX II(A)
DEBT SECURITIES
FINGERHUT COMPANIES, INC.
(the "Company")
TERMS AGREEMENT
__________, _____
FINGERHUT COMPANIES, INC.
0000 Xxxxx Xxxx
Xxxxxxxxxx, XX 00000
Attention:
Ladies and Gentlemen:
[On behalf of the several Underwriters named in Schedule A hereto and
for their respective accounts, we] [We] offer to purchase, on and subject to the
terms and conditions of the Underwriting Agreement Basic Provisions of the
Company attached hereto (the "Underwriting Agreement"), the following securities
("Securities") to be issued under an indenture, dated as of __________, _____,
between the Company and _______________, as Trustee, on the following terms:
TITLE: [_____%] [Floating Rate] [Senior] [Subordinated] [Notes]
[Debentures]
due _____
PRINCIPAL AMOUNT: $__________
INTEREST: [[_____% per annum] [Floating Rate Formula], from
__________, _____, payable semiannually on __________ and __________, commencing
__________, _____, to holders of record on the preceding __________ or
__________, as the case may be.] [Zero coupon.]
MATURITY: __________, _____.
OPTIONAL REDEMPTION:
SINKING FUND:
PERIOD DESIGNATED PURSUANT TO SECTION 4(f) OF THE UNDERWRITING
AGREEMENT: _____ days.
II(A)-1
PERIOD DESIGNATED PURSUANT TO SECTION 4(g) OF THE UNDERWRITING
AGREEMENT: _____ years.
CONVERSION PROVISIONS:
OTHER TERMS:
DELAYED DELIVERY CONTRACTS: [None.] [Delivery Date[s] shall be
_________, _____ [and ___________, _____]. The Underwriters' fee is _____% of
the principal amount of the Securities.]
PURCHASE PRICE: _____% of principal amount, plus accrued interest, if
any, from __________, _____.
EXPECTED REOFFERING PRICE: _____% of principal amount, subject to
change by the undersigned.
CLOSING DATE: [9:00 a.m.] on __________, _____, at the offices of
Cadwalader, Xxxxxxxxxx & Xxxx, 000 Xxxxxx Xxxx, Xxx Xxxx, Xxx Xxxx 00000 in
New York [Clearing House (next day)] [Federal (same day)] funds.
NAME(S) AND ADDRESS(ES) OF REPRESENTATIVE(S):
[NAME OF REPRESENTATIVES]
c/o [Name of Lead Manager]
[Address of Lead Manager]
The respective principal amounts of the Securities to be purchased by each of
the Underwriters are set forth opposite their names in Schedule A hereto.
[It is understood that we may, with your consent, amend this offer to
add additional Underwriters and reduce the aggregate principal amount to be
purchased by the Underwriters listed in Schedule A hereto by the aggregate
principal amount to be purchased by such additional Underwriters.]
The significant subsidiaries (as defined in Rule 405 under the
Securities Act of 1933) of the Company are as follows:
[List Significant Subsidiaries]
The provisions of the Underwriting Agreement are incorporated herein
by reference[, except that the obligations and agreements set forth in Section 8
("Default by an Underwriter") of the Underwriting Agreement shall not apply to
the obligations of the Underwriters to purchase the above Securities].
II(A)-2
The Securities will be made available for checking and packaging at
the office of Cadwalader, Xxxxxxxxxx & Xxxx, 000 Xxxxxx Xxxx, Xxx Xxxx, Xxx
Xxxx 00000 at least 24 hours prior to the Closing Date.
[Please signify, your acceptance of our offer by signing the response
attached hereto as Schedule B in the space provided and returning it to us.]
[Please signify your acceptance of the foregoing by return wire in the form of
Schedule B not later than __:__ p.m. today.]
Very truly yours,
[NAMES OF REPRESENTATIVES]
[On behalf of [themselves] [itself] and as
Representative[s] of the several] [As]
Underwriter[s]
[By: Name of Lead Manager]
By:
------------------------------------
Name:
Title:
II(A)-3
SCHEDULE A
NAME OF UNDERWRITER PRINCIPAL AMOUNT
------------------- ----------------
[Name of Underwriters] .................................. $
--------------
Total .............................................. $
--------------
--------------
II(A)-4
SCHEDULE B
To: [NAMES OF REPRESENTATIVES]
[On behalf of [themselves] [itself]
and as Representative[s] of the
several] [As] Underwriter[s]
[c/o Name of Lead Manager]
----------------
----------------
We accept the offer contained in your [letter] [wire], dated
__________, _____ (the "Terms Agreement"), relating to $__________ principal
amount of our [Title of Securities]. We also confirm that, to the best of
our knowledge after reasonable investigation, the representations and
warranties of the undersigned contained in Section 2 of the Underwriting
Agreement Basic Provisions of the Company referred to in the Terms Agreement
(together with the Terms Agreement, the "Underwriting Agreement"), are true
and correct, no stop order suspending the effectiveness of the Registration
Statement (as defined in the Underwriting Agreement) or of any part thereof
has been issued and no proceedings for that purpose have been instituted or,
to the best of our knowledge, are contemplated by the Securities and Exchange
Commission and, subsequent to the respective dates of the most recent
financial statements in the Prospectus (as defined in the Underwriting
Agreement), there has been (or in the case of a form of prospectus filed
pursuant to Rule 424(b)(2) or (5) there will be, as of the date of such
prospectus) no material adverse change in the financial position or results
of operations of the undersigned and its subsidiaries except as set forth in
or contemplated by the Prospectus.
Very truly yours,
FINGERHUT COMPANIES, INC.
By
--------------------------------
Name:
Title:
II(A)-5
ANNEX II(B)
EQUITY SECURITIES
FINGERHUT COMPANIES, INC.
(the "Company")
TERMS AGREEMENT
__________, _____
FINGERHUT COMPANIES, INC.
0000 Xxxxx Xxxx
Xxxxxxxxxx, XX 00000
Attention:
Ladies and Gentlemen:
[On behalf of the several Underwriters named in Schedule A hereto and
for their respective accounts, we] [We] offer to purchase, on and subject to the
terms and conditions of the Underwriting Agreement Basic Provisions of the
Company attached hereto (the "Underwriting Agreement"), the following securities
("Securities") on the following terms:
TITLE: [Common Stock] [Preferred Stock, Series _____]
NUMBER OF SHARES TO BE ISSUED: __________ shares
[For Preferred Stock Only:]
VOTING RIGHTS:
PREFERRED STOCK DIVIDENDS: Cash dividends of $_____ to $_____ per
share payable quarterly in arrears on __________, __________, __________ and
__________.
OPTIONAL REDEMPTION:
MANDATORY REDEMPTION/SINKING FUND:
LIQUIDATION PREFERENCE: $_____ per share plus __________.
CONVERSION PROVISIONS:
OTHER TERMS:
[For all Equity Securities:]
II(B)-1
NAME OF EXCHANGE OR MARKET: [New York Stock Exchange] [Nasdaq
National Market] [American Stock Exchange]
PERIOD DESIGNATED PURSUANT TO SECTION 4(f) OF THE UNDERWRITING
AGREEMENT: _____ days.
PERSONS SUBJECT TO LOCK-UP AGREEMENTS PURSUANT TO SECTION 4(f) OF THE
UNDERWRITING AGREEMENT: The persons listed on Schedule B.
PERIOD DESIGNATED PURSUANT TO SECTION 4(g) OF THE UNDERWRITING
AGREEMENT: _____ years.
PRICE TO PUBLIC: $_____ per share.
UNDERWRITING DISCOUNTS AND COMMISSION:
PROCEEDS TO COMPANY:
OVER-ALLOTMENT OPTION:
NAME OF TRANSFER AGENT AND REGISTRAR:
CLOSING DATE: [9:00 a.m.] on __________, _____, at the offices of
Cadwalader, Xxxxxxxxxx & Xxxx, 000 Xxxxxx Xxxx, Xxx Xxxx, Xxx Xxxx 00000 in New
York [Clearing House (next day)] [Federal (same day)] funds.
NAME(S) AND ADDRESS(ES) OF REPRESENTATIVE(S):
[NAME OF REPRESENTATIVES]
c/o [Name of Lead Manager]
[Address of Lead Manager]
The respective shares of the Securities to be purchased by each of the
Underwriters are set forth opposite their names in Schedule A hereto.
[It is understood that we may, with your consent, amend this offer to
add additional Underwriters and reduce the number of shares to be purchased by
the Underwriters listed in Schedule A hereto by the number of shares to be
purchased by such additional Underwriters.]
The significant subsidiaries (as defined in Rule 405 under the
Securities Act of 1933) of the Company are as follows:
[List Significant Subsidiaries]
The provisions of the Underwriting Agreement are incorporated herein
by reference[, except that the obligations and agreements set forth in Section 8
("Default by an
II(B)-2
Underwriter") of the Underwriting Agreement shall not apply to the
obligations of the Underwriters to purchase the above Securities].
The Securities will be made available for checking and packaging at
the office of Cadwalader, Xxxxxxxxxx & Xxxx, 000 Xxxxxx Xxxx, Xxx Xxxx, Xxx
Xxxx 00000 at least 24 hours prior to the Closing Date.
[Please signify, your acceptance of our offer by signing the response
attached hereto as Schedule C in the space provided and returning it to us.]
[Please signify your acceptance of the foregoing by return wire in the form of
Schedule C not later than __:__ p.m. today.]
Very truly yours,
[NAMES OF REPRESENTATIVES]
[On behalf of [themselves] [itself] and as
Representative[s] of the several] [As]
Underwriter[s]
[By: Name of Lead Manager]
By:
-------------------------------------
Name:
Title:
II(B)-3
SCHEDULE A
NAME OF UNDERWRITER NUMBER OF SHARES
------------------- ----------------
[Name of Underwriters.......................................
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Total.............................................
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II(B)-4
SCHEDULE B
[List Persons Subject to Lock-up]
II(B)-5
SCHEDULE C
To: [NAMES OF REPRESENTATIVES]
[On behalf of [themselves] [itself]
and as Representative[s] of the
several] [As] Underwriter[s]
[c/o Name of Lead Manager]
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We accept the offer contained in your [letter] [wire], dated
__________, _____ (the "Terms Agreement"), relating to __________ shares of
our [Title of Securities]. We also confirm that, to the best of our
knowledge after reasonable investigation, the representations and warranties
of the undersigned contained in Section 2 of the Underwriting Agreement Basic
Provisions of the Company referred to in the Terms Agreement (together with
the Terms Agreement, the "Underwriting Agreement"), are true and correct, no
stop order suspending the effectiveness of the Registration Statement (as
defined in the Underwriting Agreement) or of any part thereof has been issued
and no proceedings for that purpose have been instituted or, to the best of
our knowledge, are contemplated by the Securities and Exchange Commission
and, subsequent to the respective dates of the most recent financial
statements in the Prospectus (as defined in the Underwriting Agreement),
there has been (or in the case of a form of prospectus filed pursuant to Rule
424(b)(2) or (5) there will be, as of the date of such prospectus) no
material adverse change in the financial position or results of operations of
the undersigned and its subsidiaries except as set forth in or contemplated
by the Prospectus.
Very truly yours,
FINGERHUT COMPANIES, INC.
By
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Name:
Title:
II(B)-6
