Exhibit 1.1
Execution Version
9,000,000 SHARES
PEABODY ENERGY CORPORATION
COMMON STOCK
UNDERWRITING AGREEMENT
April 4, 2002
XXXXXX BROTHERS INC.
BEAR, XXXXXXX & CO. INC.
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX INCORPORATED
XXXXXX XXXXXXX & CO. INCORPORATED
UBS WARBURG LLC
X.X. XXXXXXX & SONS, INC.
As Representatives of the several
Underwriters named in Schedule 1,
c/x Xxxxxx Brothers Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
Certain stockholders of Peabody Energy Corporation, a Delaware
corporation (the "COMPANY"), named in Schedule 2 hereto (the "SELLING
STOCKHOLDERS") propose to sell 9,000,000 shares (the "FIRM STOCK") of the
Company's Common Stock, par value $0.01 per share (the "COMMON STOCK").
In addition, certain of the Selling Stockholders propose to grant to
the Underwriters named in Schedule 1 hereto (the "UNDERWRITERS") an option to
purchase up to an additional 1,100,000 shares of the Common Stock on the terms
and for the purposes set forth in Section 3 (the "OPTION STOCK"). The Firm Stock
and the Option Stock, if purchased, are hereinafter collectively called the
"STOCK." This is to confirm the agreement concerning the purchase of the Stock
from the Selling Stockholders by the Underwriters.
SECTION 1. Representations, Warranties and Agreements of the Company.
The Company represents, warrants and agrees that:
(a) A registration statement on Form S-3 with respect to the Stock has
(i) 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, (ii) been filed with the Commission
under the Securities Act, and (iii) become effective under the Securities Act.
Copies of such registration statement and each of the amendments thereto have
been delivered by the Company to you. As
used in this Agreement, "EFFECTIVE TIME" means the date and the time as of which
such registration statement, or the most recent post-effective amendment
thereto, if any, was declared effective by the Commission; "EFFECTIVE DATE"
means the date of the Effective Time; "PRELIMINARY PROSPECTUS" means each
prospectus included in such registration statement, or amendments thereof,
before it became effective under the Securities Act and any prospectus filed
with the Commission by the Company with the consent of the Representatives
pursuant to Rule 424(a) of the Rules and Regulations; "REGISTRATION STATEMENT"
means such registration statement, as amended at the Effective Time, including
any documents incorporated by reference therein at such time and all information
contained in the final prospectus filed with the Commission pursuant to Rule
424(b) of the Rules and Regulations and deemed to be a part of the registration
statement as of the Effective Time pursuant to Rule 430A of the Rules and
Regulations; and "PROSPECTUS" means the prospectus supplement and the
accompanying prospectus and any and all information incorporated by reference
therein at such time, in the form first used to confirm sales of Stock.
Reference made herein to any Preliminary Prospectus or to the Prospectus shall
be deemed to refer to and include any documents incorporated by reference
therein pursuant to Item 12 of Form S-3 under the Securities Act, as of the date
of such Preliminary Prospectus or the Prospectus, as the case may be, and any
reference to any amendment or supplement to any Preliminary Prospectus or the
Prospectus shall be deemed to refer to and include any document filed under the
Securities Exchange Act of 1934, as amended (the "EXCHANGE Act"), after the date
of such Preliminary Prospectus or the Prospectus, as the case may be, and
incorporated by reference in such Preliminary Prospectus or the Prospectus, as
the case may be; and any reference to any amendment to the Registration
Statement shall be deemed to include any annual report of the Company filed with
the Commission pursuant to Section 13(a) or 15(d) of the Exchange Act after the
Effective Time that is incorporated by reference in the Registration Statement.
If the Company has filed an abbreviated registration statement to register
additional shares of Common Stock pursuant to Rule 462(b) under the Securities
Act (the "RULE 462 REGISTRATION STATEMENT"), then any reference herein to the
term "REGISTRATION STATEMENT" shall be deemed to include such Rule 462
Registration Statement. The Commission has not issued any order preventing or
suspending the use of any Preliminary Prospectus.
(b) The Registration Statement conforms, and the Prospectus and any
further amendments or supplements to the Registration Statement or the
Prospectus will, when it becomes effective or is filed with the Commission, as
the case may be, conform, in all material respects to the requirements of the
Securities Act and the Rules and Regulations and do not and will not, as of the
applicable effective date (as to the Registration Statement and any amendment
thereto) and as of the applicable filing date (as to the Prospectus and any
amendment or supplement thereto) in light of the circumstances in which they
were made 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; provided that no representation or warranty is made as
to 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
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through the Representatives by or on behalf of any Underwriter specifically for
inclusion therein.
(c) The documents incorporated by reference in the Prospectus, when
they became effective or were filed with the Commission, as the case may be,
conformed in all material respects to the requirements of the Securities Act or
Exchange Act, as applicable, and the Rules and Regulations, and none of such
documents contained an untrue statement of a material fact or omitted to state a
material fact necessary to make the statements therein not misleading in light
of the circumstances in which they were made; and any further documents so filed
and incorporated by reference in the Prospectus, when such documents become
effective or are filed with Commission, as the case may be, will conform in all
material respects to the requirements of the Securities Act or Exchange Act, as
applicable, and the Rules and Regulations and will not contain an untrue
statement of a material fact or omit to state a material fact necessary to make
the statements therein not misleading in light of the circumstances in which
they were made.
(d) The Company and each of its subsidiaries (as defined in Section 17)
have been duly incorporated or organized, as the case may be, and are validly
existing as their respective business entities and in good standing under the
laws of their respective jurisdictions of incorporation or organization, as the
case may be, are duly qualified to do business and are in good standing as
foreign corporations in each jurisdiction in which their respective ownership or
lease of property or the conduct of their respective businesses requires such
qualification, and have all power and authority necessary to own or hold their
respective properties and to conduct the businesses in which they are engaged,
except where the failure to so qualify to be in good standing would not
reasonably be expected to have a material adverse effect on the financial
condition, business, properties or results of operations of the Company and its
subsidiaries taken as a whole (a "MATERIAL ADVERSE EFFECT"); and none of the
subsidiaries of the Company other than Black Beauty Coal Company, Caballo Coal
Company, Coal Properties Corp., Gold Fields Mining Corporation, Peabody Coal
Company, Peabody Development Company, Peabody Holding Company, Inc., Peabody
Natural Resources Company, Peabody Western Coal Company and Powder River Coal
Company is a "significant subsidiary," as such term is defined in Rule 405 of
the Rules and Regulations.
(e) The Company has an authorized capitalization as set forth in the
Prospectus, and all of the issued shares of capital stock of the Company have
been duly and validly authorized and issued, are fully paid and non-assessable
and conform to the description thereof contained in the Prospectus; and all of
the issued shares of capital stock or membership interests, as the case may be,
of each wholly-owned subsidiary of the Company have been duly and validly
authorized and issued and are fully paid and non-assessable and (except for
directors' qualifying shares) are owned directly or indirectly by the Company,
free and clear of all liens, encumbrances, equities or claims.
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(f) The shares of the Stock to be sold by the Selling Stockholders to
the Underwriters hereunder have been duly and validly authorized.
(g) This Agreement has been duly authorized, executed and delivered by
the Company.
(h) The execution, delivery and performance of this Agreement by the
Company, the compliance by the Company with all of the provisions of this
Agreement and the consummation of the transactions contemplated hereby will not
(i) conflict with or result in a breach or violation of any of the terms or
provisions of, or constitute a default under, any indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument to which the Company or
any of its subsidiaries is a party or by which the Company or any of its
subsidiaries is bound or to which any of the property or assets of the Company
or any of its subsidiaries is subject, (ii) result in any violation of the
provisions of the Certificate of Incorporation or by-laws of the Company or any
of its subsidiaries or (iii) result in the violation of any statute or any
order, rule or regulation of any court or governmental agency or body having
jurisdiction over the Company or any of its subsidiaries or any of their
properties or assets, except in the case of clauses (i) and (iii), such
conflicts, breaches or violations that in the aggregate would not reasonably be
expected to have a Material Adverse Effect; and except for the registration of
the Stock under the Securities Act and such consents, approvals, authorizations,
registrations or qualifications as may be required under the Exchange Act, and
applicable state securities laws in connection with the purchase and
distribution of the Stock by the Underwriters, no consent, approval,
authorization or order of, or filing or registration with, any such court or
governmental agency or body is required for the execution, delivery and
performance of this Agreement by the Company and the consummation of the
transactions contemplated hereby.
(i) Except as set forth in the Prospectus, there are no contracts,
agreements or understandings between the Company and any person granting such
person the right to require the Company to file a registration statement under
the Securities Act with respect to any securities of the Company owned or to be
owned by such person or to require the Company to include such securities in the
securities registered pursuant to the Registration Statement or in any
securities being registered pursuant to any other registration statement filed
by the Company under the Securities Act.
(j) Except as set forth in the Registration Statement, the Company has
not sold or issued any shares of Common Stock during the six-month period
preceding the date of the Prospectus, including any sales pursuant to Rule 144A
under, or Regulations D or S of, the Securities Act.
(k) Neither the Company nor any of its subsidiaries has sustained,
since the date of the latest audited financial statements included in the
Prospectus, any material loss or interference with its business that has had a
Material Adverse Effect, whether from fire, explosion, flood or other calamity,
whether or not covered by
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insurance, or from any labor dispute or court or governmental action, order or
decree, otherwise than as set forth or contemplated in the Prospectus; and,
since such date, there has not been any material change in the capital stock or
material increase in the long-term debt of the Company or any of its
subsidiaries or any change, in or affecting the general affairs, management,
consolidated financial position, stockholders' equity, results of operations,
business or prospects of the Company and its subsidiaries that has had or could
reasonably be expected to have a Material Adverse Effect, other than as set
forth or contemplated in the Prospectus.
(l) The financial statements (including the related notes and
supporting schedules) filed as part of the Registration Statement or included in
the Prospectus present fairly the financial condition and results of operations
of the entities purported to be shown thereby, at the dates and for the periods
indicated, and the consolidated historical financial statements have been
prepared in conformity with generally accepted accounting principles ("GAAP")
applied on a consistent basis throughout the periods involved.
(m) Ernst & Young LLP, who have certified certain financial statements
of the Company, whose report appears in the Prospectus and who have delivered
the initial letter referred to in Section 9(f) hereof, are and have been
independent public accountants as required by the Securities Act and the Rules
and Regulations during the periods covered by the financial statements on which
they reported.
(n) The Company and each of its subsidiaries have good and marketable
title in fee simple to all real property and good and marketable title to all
personal property owned by them, in each case free and clear of all liens,
encumbrances and defects, except such as are described in the Prospectus or that
would not reasonably be expected to have a Material Adverse Effect; and all real
property held under lease by the Company and its subsidiaries that is material
to the Company and its subsidiaries, taken as a whole, is held by them under
valid, subsisting and enforceable leases, with such exceptions as are not
material and do not interfere with the use made and proposed to be made of such
property and buildings by the Company and its subsidiaries.
(o) To the knowledge of the Company, the Company and each of its
subsidiaries carry, or are covered by, insurance in such amounts and covering
such risks as is adequate for the conduct of their respective businesses and the
value of their respective properties and as is customary for companies engaged
in similar businesses in similar industries.
(p) Except as set forth in the Prospectus, there are no legal or
governmental proceedings pending to which the Company or any of its subsidiaries
is a party or of which any property or assets of the Company or any of its
subsidiaries is the subject which, if determined adversely to the Company or any
of its subsidiaries, would be reasonably likely to have a Material Adverse
Effect; and to the best of the Company's
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knowledge, no such proceedings are threatened or contemplated by governmental
authorities or threatened by others.
(q) The conditions for use of Form S-3, as set forth in the General
instructions thereto, have been satisfied.
(r) There are no contracts or other documents that are required to be
described in the Prospectus or filed as exhibits to the Registration Statement
by the Securities Act or by the Rules and Regulations that have not been
described in the Prospectus or filed as exhibits to the Registration Statement.
(s) No relationship, direct or indirect, exists between or among the
Company on the one hand, and the directors, officers, stockholders, customers or
suppliers of the Company on the other hand, which is required to be described in
the Prospectus that is not so described.
(t) No labor disturbance by the employees of the Company exists or, to
the knowledge of the Company, is imminent, which would reasonably be expected to
have a Material Adverse Effect, except as disclosed in the Prospectus.
(u) Except as would not reasonably be expected to have a Material
Adverse Effect, the Company is in compliance in all material respects with all
presently applicable provisions of the Employee Retirement Income Security Act
of 1974, as amended, including the regulations and published interpretations
thereunder ("ERISA"); no "REPORTABLE EVENT" (as defined in ERISA) has occurred
with respect to any "PENSION PLAN" (as defined in ERISA) for which the Company
would have any liability; the Company has not incurred and does not expect to
incur liability under (i) Title IV of ERISA with respect to termination of, or
withdrawal from, any "PENSION PLAN" or (ii) Sections 412 or 4971 of the Internal
Revenue Code of 1986, as amended, including the regulations and published
interpretations thereunder (the "CODE"); and each "PENSION PLAN" for which the
Company would have any liability that is intended to be qualified under Section
401(a) of the Code is so qualified in all material respects and nothing has
occurred, whether by action or by failure to act, which would cause the loss of
such qualification, except as would not reasonably be expected to have a
Material Adverse Effect.
(v) The Company has filed (or obtained extensions in filing) all
federal, state and local income and franchise tax returns required to be filed
through the date hereof (other than those the nonfiling of which would not be
reasonably likely to have a Material Adverse Effect) and has paid all taxes due
thereon, other than those being contested in good faith and for which reserves
have been provided in accordance with GAAP, those currently payable without
penalty or interest or the nonpayment of which would not be reasonably likely to
have a Material Adverse Effect. No tax deficiency has been determined adversely
to the Company or any of its subsidiaries that has had (nor does the Company
have any knowledge of any tax deficiency which, if determined
6
adversely to the Company or any of its subsidiaries, would reasonably be
expected to have) a Material Adverse Effect.
(w) Since the date as of which information is given in the Prospectus
through the date hereof, and except as may otherwise be disclosed in the
Prospectus, the Company has not (i) issued or granted any securities (other than
pursuant to the Company's employee benefit plans), (ii) incurred any liability
or obligation, direct or contingent, other than liabilities and obligations that
were incurred in the ordinary course of business, (iii) entered into any
transaction not in the ordinary course of business, or (iv) declared or paid any
dividend on its capital stock.
(x) The Company (i) makes and keeps accurate books and records and (ii)
maintains internal accounting controls that provide reasonable assurance that
(A) transactions are executed in accordance with management's authorization, (B)
transactions are recorded as necessary to permit preparation of its financial
statements and to maintain accountability for its assets, (C) access to its
assets is permitted only in accordance with management's authorization and (D)
the reported accountability for its assets is compared with existing assets at
reasonable intervals.
(y) Neither the Company nor any of its subsidiaries (i) is in violation
of its organizational documents, (ii) is in default, and no event has occurred
which, with notice or lapse of time or both, would constitute such a default, in
the due performance or observance of any term, covenant or condition contained
in any material indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which it is a party or by which it is bound or to
which any of its properties or assets is subject, or (iii) is 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 material
license, permit, certificate, franchise or other governmental authorization or
permit necessary to the ownership of its property or to the conduct of its
business, except, in the cases of clauses (ii) and (iii), such defaults, events,
violations or failures that in the aggregate would not reasonably be expected to
have a Material Adverse Effect.
(z) Except as set forth in the Prospectus, there has been no storage,
disposal, generation, manufacture, refinement, transportation, handling or
treatment of toxic wastes, medical wastes, hazardous wastes or hazardous
substances by the Company or any of its subsidiaries (or, to the knowledge of
the Company, any of their predecessors in interest) at, upon or from any of the
property now or previously owned or leased by the Company or its subsidiaries in
violation of any applicable law, ordinance, rule, regulation, order, judgment,
decree or permit or that would require remedial action under any applicable law,
ordinance, rule, regulation, order, judgment, decree or permit, except for any
violation or remedial action that would not have, or would not be reasonably
likely to have, singularly or in the aggregate with all such violations and
remedial actions, a Material Adverse Effect, except as set forth in, or
specifically contemplated by, the Prospectus; there has been no material spill,
discharge, leak, emission, injection, escape, dumping or release of any kind
onto such property or into the environment surrounding such property of any
toxic wastes, medical wastes, solid wastes, hazardous wastes or
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hazardous substances due to or caused by the Company or any of its subsidiaries
or with respect to which the Company or any of its subsidiaries have knowledge,
except for any such spill, discharge, leak, emission, injection, escape, dumping
or release that would not have or would not be reasonably likely to have,
singularly or in the aggregate with all such spills, discharges, leaks,
emissions, injections, escapes, dumpings and releases, a Material Adverse
Effect; and the terms "HAZARDOUS WASTES," "TOXIC WASTES," "HAZARDOUS SUBSTANCES"
and "MEDICAL WASTES" shall have the meanings specified in any applicable local,
state, federal and foreign laws or regulations with respect to environmental
protection.
(aa) Neither the Company nor any subsidiary is, or, after giving effect
to the offering and sale of the Stock as described in the Prospectus, will be,
an "investment company" as defined in the Investment Company Act of 1940, as
amended.
(bb) The market-related and industry data included in the Prospectus
are based upon estimates by the Company derived from sources that the Company
believes to be reliable and accurate in all material respects.
(cc) The Company has such permits, licenses, franchises, certificates,
consents, orders and other approvals or authorizations of any governmental or
regulatory authority ("PERMITS"), including, without limitation, any permits or
approvals required by the United States Environmental Protection Agency, the
United States Office of Surface Mining Reclamation and Enforcement and
corresponding state agencies, as are necessary under applicable law to own its
properties and to conduct its businesses in the manner described in the
Prospectus, except to the extent that the failure to have such Permits would not
reasonably be expected to have a Material Adverse Effect. The Company has
fulfilled and performed in all material respects, all its material obligations
with respect to the Permits, and, to the best knowledge of the Company, no event
has occurred that allows, or after notice or lapse of time would allow,
revocation or termination thereof or results in any other material impairment of
the rights of the holder of any such Permit, subject in each case to such
qualification as may be set forth in the Prospectus and except to the extent
that any such revocation or termination would not reasonably be expected to have
a Material Adverse Effect.
SECTION 2. Representations, Warranties and Agreements of the Selling
Stockholders. Each Selling Stockholder (except with respect to Sections 2(f) and
(g), which are applicable only to Xxxxxx Brothers Merchant Banking Partners II
L.P. and certain of its affiliates who are selling Stock in the Offering (the
"XXXXXX SELLING STOCKHOLDERS"), Co-Investment Partners, L.P., Xxxx X. Xxxxxx,
the Indenture of Trust of Xxxxxxx X. Xxxxxxx and the Xxxxx X. Xxxxxxx, Xx.
Revocable Trust U/T/A ) severally represents, warrants and agrees that:
(a) The Selling Stockholder has, and immediately prior to the First
Delivery Date (as defined in Section 5 hereof) the Selling Stockholder will have
full right, power and authority to sell, assign, transfer and deliver the shares
of Stock to be sold by the Selling Stockholder hereunder on such date; and upon
delivery of such shares
8
and payment therefor pursuant hereto the several Underwriters will acquire a
security entitlement with respect to such shares on the Closing Date and no
action based on an adverse claim may be asserted against the Underwriters with
respect to such shares.
(b) The Selling Stockholder has placed in custody under a custody
agreement (the "CUSTODY AGREEMENT" and, together with all other similar
agreements executed by the other Selling Stockholders, the "Custody Agreements")
with EquiServe Trust Company, N.A., as custodian (the "CUSTODIAN"), for delivery
under this Agreement, certificates in negotiable form (with signature guaranteed
by a commercial bank or trust company having an office or correspondent in the
United States or a member firm of the New York or American Stock Exchanges)
representing the shares of Stock to be sold by the Selling Stockholder
hereunder.
(c) The Selling Stockholder has duly and irrevocably executed and
delivered a power of attorney (the "POWER OF ATTORNEY" and, together with all
other similar agreements executed by the other Selling Stockholders, the "Powers
of Attorney") appointing one or more persons, as attorneys-in-fact, with full
power of substitution, and with full authority (exercisable by any one or more
of them) to execute and deliver this Agreement and to take such other action as
may be necessary or desirable to carry out the provisions hereof on behalf of
the Selling Stockholder.
(d) The Selling Stockholder has full right, power and authority to
enter into this Agreement, the Power of Attorney and the Custody Agreement; the
execution, delivery and performance of this Agreement, the Power of Attorney and
the Custody Agreement by the Selling Stockholder and the consummation by the
Selling Stockholder of the transactions contemplated hereby and thereby will not
conflict with or result in a breach or violation of any of the terms or
provisions of, or constitute a default under, any indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument to which the Selling
Stockholder is a party or by which the Selling Stockholder is bound or to which
any of the property or assets of the Selling Stockholder is subject, nor will
such actions result in any violation of the provisions of any partnership
agreement, certificate of incorporation or deed of trust of the Selling
Stockholder or any statute or any order, rule or regulation of any court or
governmental agency or body having jurisdiction over the Selling Stockholder or
the property or assets of the Selling Stockholder; and, except for the
registration of the Stock under the Securities Act and such consents, approvals,
authorizations, registrations or qualifications as may be required under the
Exchange Act and applicable state securities laws in connection with the
purchase and distribution of the Stock by the Underwriters, no consent,
approval, authorization or order of, or filing or registration with, any such
court or governmental agency or body is required for the execution, delivery and
performance of this Agreement, the Power of Attorney or the Custody Agreement by
the Selling Stockholder and the consummation by the Selling Stockholder of the
transactions contemplated hereby and thereby.
(e) The Registration Statement and the Prospectus and any further
amendments or supplements to the Registration Statement or the Prospectus, when
they become effective or are filed with the Commission, as the case may be, do
not and will
9
not, as of the applicable effective date (as to the Registration Statement and
any amendment thereto) and as of the applicable filing date (as to the
Prospectus and any amendment or supplement thereto in light of the circumstances
in which they were made) 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; provided that this representation and
warranty is made only as to information contained in or omitted from the
Registration Statement or the Prospectus under the caption "Selling
Stockholders" relating to such Selling Stockholder.
(f) The Selling Stockholder has no reason to believe that the
representations and warranties of the Company contained in Section 1 hereof are
not materially true and correct, is familiar with the Registration Statement and
the Prospectus (as amended or supplemented) and has no knowledge of any material
fact, condition or information not disclosed in the Registration Statement, as
of the effective date, or the Prospectus (or any amendment or supplement
thereto) in light of the circumstances in which they were made, as of the
applicable filing date, which has adversely affected or may adversely affect the
business of the Company and is not prompted to sell shares of Common Stock by
any information concerning the Company that is not set forth in the Registration
Statement and the Prospectus.
(g) The Selling Stockholder has reviewed the Registration Statement and
the Prospectus, and, although the Selling Stockholder has not independently
verified and is not passing upon and assumes no responsibility for the accuracy,
completeness or fairness of the statements contained in the Registration
Statement and Prospectus, the Selling Stockholder has no reason to believe that
the Registration Statement, as of the effective date thereof, contains an untrue
statement of a material fact or omits to state a material fact required to be
stated therein or necessary to make the statements contained therein not
misleading or that the Prospectus, on the date thereof or on the date hereof,
contains an untrue statement of a material fact or omits to state a material
fact or necessary to make the statements contained therein, in light of the
circumstances under which they were made, not misleading.
(h) The Selling Stockholder has not taken and will not take, directly
or indirectly, any action which is designed to or which has constituted or which
might reasonably be expected to cause or result in the stabilization or
manipulation of the price of any security of the Company to facilitate the sale
or resale of the shares of the Stock.
SECTION 3. Purchase of the Stock by the Underwriters. On the basis of
the representations and warranties contained in, and subject to the terms and
conditions of, this Agreement, each Selling Stockholder hereby agrees to sell
the number of shares of the Firm Stock set forth opposite its name in Schedule 2
hereto to the several Underwriters and each of the Underwriters, severally and
not jointly, agrees to purchase the number of shares of the Firm Stock set forth
opposite that Underwriter's name in Schedule 1 hereto. Each Underwriter shall be
obligated to purchase from each Selling Stockholder that number of shares of the
Firm Stock that represents the same proportion of the number of shares of Firm
Stock to be sold, as the number of shares of the Firm
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Stock set forth opposite the name of such Underwriter in Schedule 1 hereto
represents of the total number of shares of the Firm Stock to be purchased by
all of the Underwriters pursuant to this Agreement. The respective purchase
obligations of the Underwriters with respect to the Firm Stock shall be rounded
among the Underwriters to avoid fractional shares, as the Representatives may
determine.
In addition, on the basis of the representations and warranties
contained in, and subject to the terms and conditions of, this Agreement,
certain of the Selling Stockholders grant to the Underwriters an option to
purchase up to 1,100,000 shares of Option Stock. Such option is granted solely
for the purpose of covering over-allotments in the sale of Firm Stock and is
exercisable as provided in Section 5 hereof. Shares of Option Stock shall be
purchased severally for the account of the Underwriters in proportion to the
number of shares of Firm Stock set forth opposite the name of such Underwriters
in Schedule 1 hereto. The respective purchase obligations of each Underwriter
with respect to the Option Stock shall be adjusted by the Representatives so
that no Underwriter shall be obligated to purchase Option Stock other than in
100 share amounts.
The price of both the Firm Stock and any Option Stock shall be $27.38
per share.
The Selling Stockholders shall not be obligated to deliver any of the
Stock to be delivered on any Delivery Date (as hereinafter defined), except upon
payment for all the Stock to be purchased on such Delivery Date as provided
herein.
SECTION 4. Offering of Stock by the Underwriters. Upon authorization by
the Representatives of the release of the Firm Stock, the several Underwriters
propose to offer the Firm Stock for sale upon the terms and conditions set forth
in the Prospectus.
SECTION 5. Delivery of and Payment for the Stock. Delivery of and
payment for the Firm Stock shall be made at the offices of Weil, Gotshal &
Xxxxxx LLP, 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, at 10:00 A.M., New York
City time, on the fourth full business day following the date of this Agreement
or at such other date or place as shall be determined by agreement between the
Representatives and the Company. This date and time are sometimes referred to as
the "FIRST DELIVERY DATE." On the First Delivery Date, the Selling Stockholders
shall deliver or cause to be delivered security entitlements with respect to the
Firm Stock to the Representatives for the account of each Underwriter against
payment to or upon the order of the Selling Stockholders of the purchase price
by wire transfer in immediately available funds. Time shall be of the essence,
and delivery at the time and place specified pursuant to this Agreement is a
further condition of the obligation of each Underwriter hereunder. Upon
delivery, the Firm Stock shall be registered in such names and in such
denominations as the Representatives shall request in writing not less than two
full business days prior to the First Delivery Date.
11
The option granted in Section 3 will expire 30 days after the
date of this Agreement and may be exercised in whole or in part from time to
time but in no event more than twice, by written notice being given to the
Company and the Selling Stockholders by the Representatives. Such notice shall
set forth the aggregate number of shares of Option Stock as to which the option
is being exercised, the names in which the shares of Option Stock are to be
registered, the denominations in which the shares of Option Stock are to be
issued and the date and time, as determined by the Representatives, when the
shares of Option Stock are to be delivered; provided, however, that this date
and time shall not be earlier than the First Delivery Date nor earlier than the
second business day after the date on which the option shall have been exercised
nor later than the fifth business day after the date on which the option shall
have been exercised. The date and time the shares of Option Stock are delivered
are sometimes referred to as a "SECOND DELIVERY DATE" and the First Delivery
Date and any Second Delivery Date are sometimes each referred to as a "DELIVERY
DATE."
Delivery of security entitlements with respect to and payment
for the Option Stock shall be made at the place specified in the first sentence
of the first paragraph of this Section 5 (or at such other place as shall be
determined by agreement between the Representatives and the Company) at 10:00
A.M., New York City time, on such Second Delivery Date. On such Second Delivery
Date, the Selling Stockholders who are selling the Option Stock shall deliver or
cause to be delivered the security entitlements with respect to the certificates
representing the Option Stock to the Representatives for the account of each
Underwriter against payment to or upon the order of such Selling Stockholders of
the purchase price by wire transfer in immediately available funds. Time shall
be of the essence, and delivery at the time and place specified pursuant to this
Agreement is a further condition of the obligation of each Underwriter
hereunder. Upon delivery, the Option Stock shall be registered in such names and
in such denominations as the Representatives shall request in the aforesaid
written notice.
SECTION 6. Further Agreements of the Company. The Company agrees:
(a) To prepare the Prospectus in a form approved by the
Representatives and to file such Prospectus pursuant to Rule 424(b) under the
Securities Act not later than Commission's close of business on the second
business day following the execution and delivery of this Agreement or, if
applicable, such earlier time as may be required by Rule 430A(a)(3) under the
Securities Act; to make no further amendment or any supplement to the
Registration Statement or to the Prospectus prior to the last Delivery Date
except as permitted herein; to advise the Representatives, promptly after it
receives notice thereof, of the time when any amendment to the Registration
Statement has been filed or becomes effective or any supplement to the
Prospectus or any amended Prospectus has been filed and to furnish the
Representatives with copies thereof; to file promptly all reports and any
definitive proxy or information statements required to be filed by the Company
with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the
Exchange Act subsequent to the date of the Prospectus and for so long as the
delivery of a prospectus is required in connection with the offering or sale of
the Stock; to advise the Representatives, promptly after it receives notice
thereof, of the issuance by
12
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 Stock 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.
(b) To furnish promptly to each of the Representatives and to
counsel for the Underwriters a signed copy of the Registration Statement as
originally filed with the Commission, and each amendment thereto filed with the
Commission, including all consents and exhibits filed therewith.
(c) To deliver promptly to the Representatives such number of
the following documents as the Representatives shall reasonably request: (i)
conformed copies of the Registration Statement as originally filed with the
Commission and each amendment thereto (in each case excluding exhibits) and (ii)
each Preliminary Prospectus, the Prospectus and any amended or supplemented
Prospectus; and, if the delivery of a prospectus is required at any time after
the Effective Time in connection with the offering or sale of the Stock or any
other securities relating thereto and if at such time any events shall have
occurred as a result of which the Prospectus as then amended or supplemented
would include an untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made when such Prospectus is delivered,
not misleading, or, if for any other reason it shall be necessary to amend or
supplement the Prospectus in order to comply with the Securities Act, to notify
the Representatives and, upon their request, to prepare and furnish without
charge to each Underwriter and to any dealer in securities as many copies as the
Representatives may from time to time reasonably request of an amended or
supplemented Prospectus that will correct such statement or omission or effect
such compliance.
(d) To file promptly with the Commission any amendment to the
Registration Statement or the Prospectus or any supplement to the Prospectus
that may, in the judgment of the Company and the Representatives, be required by
the Securities Act or requested by the Commission.
(e) Prior to filing with the Commission any amendment to the
Registration Statement or supplement to the Prospectus, any document
incorporated by reference in the Prospectus or any prospectus pursuant to Rule
424 of the Rules and Regulations, to furnish a copy thereof to the
Representatives and counsel for the Underwriters and obtain the consent of the
Representatives to the filing which consent shall not be unreasonably withheld.
(f) As soon as practicable after the Effective Date, to make
generally available to the Company's security holders and to deliver to the
Representatives an
13
earning statement of the Company and its subsidiaries (which need not be
audited) complying with Section 11(a) of the Securities Act and the Rules and
Regulations (including, at the option of the Company, Rule 158).
(g) For a period of five years following the Effective Date,
to furnish to the Representatives, to the extent such information is not freely
available on the Internet, copies of all materials furnished by the Company to
its shareholders and all public reports and all reports and financial statements
furnished by the Company to the principal national securities exchange upon
which the Common Stock may be listed pursuant to requirements of or agreements
with such exchange or to the Commission pursuant to the Exchange Act or any rule
or regulation of the Commission thereunder.
(h) Promptly from time to time to take such action as the
Representatives may reasonably request to qualify the Stock for offering and
sale under the securities laws of such jurisdictions as the Representatives may
request and to comply with such laws so as to permit the continuance of sales
and dealings therein in such jurisdictions for as long as may be necessary to
complete the distribution of the Stock; provided that in connection therewith
the Company shall not be required to qualify as a foreign corporation, to file a
general consent to service of process in any jurisdiction or to subject itself
to taxation in respect of doing business in any jurisdiction in which it is
otherwise not subject.
(i) For a period of 45 days from the date of the Prospectus,
not to, directly or indirectly, (1) offer for sale, sell, pledge or otherwise
dispose of (or enter into any transaction or device that is designed to, or
could be expected to, result in the disposition by any person at any time in the
future of) any shares of Common Stock or securities convertible into or
exchangeable for Common Stock (other than the Stock and shares issued pursuant
to employee benefit plans, qualified stock option plans or other employee
compensation plans existing on the date hereof or pursuant to currently
outstanding options, warrants or rights and shares to be issued as consideration
in an acquisition), or sell or grant options, rights or warrants with respect to
any shares of Common Stock or securities convertible into or exchangeable for
Common Stock (other than the grant of options pursuant to option plans existing
on the date hereof), or (2) enter into any swap or other derivatives transaction
that transfers to another, in whole or in part, any of the economic benefits or
risks of ownership of such shares of Common Stock, whether any such transaction
described in clause (1) or (2) above is to be settled by delivery of Common
Stock or other securities, in cash or otherwise, in each case without the prior
written consent of Xxxxxx Brothers Inc. on behalf of the Underwriters; and to
use reasonable efforts to cause the Selling Stockholders to furnish to the
Representatives, prior to the First Delivery Date, a letter or letters,
substantially in the form of Exhibit A hereto, pursuant to which each such
person shall agree not to, directly or indirectly, (1) offer for sale, sell,
pledge or otherwise dispose of (or enter into any transaction or device that is
designed to, or could be expected to, result in the disposition by any person at
any time in the future of) any shares of Common Stock or securities convertible
into or exchangeable for Common Stock (other than the Stock to be sold the
Selling Stockholders hereunder) or (2) enter into any swap or other derivatives
14
transaction that transfers to another, in whole or in part, any of the economic
benefits or risks of ownership of such shares of Common Stock, whether any such
transaction described in clause (1) or (2) above is to be settled by delivery of
Common Stock or other securities, in cash or otherwise, in each case for a
period of 45 days from the date of the Prospectus, without the prior written
consent of Xxxxxx Brothers Inc. on behalf of the Underwriters.
(j) To take such steps as shall be necessary to ensure that
neither the Company nor any subsidiary shall become an "investment company" as
defined in the Investment Company Act of 1940, as amended.
SECTION 7. Further Agreements of the Selling Stockholders. Each of the
Selling Stockholders (except with respect to Section 7(a), which applies only to
the Xxxxxx Selling Stockholders, Co-Investment Partners, L.P., Irl X. Xxxxxxxxxx
and Xxxxxxx X. Xxxxxxx) agree:
(a) For a period of 45 days from the date of the Prospectus,
not to, directly or indirectly, (1) offer for sale, sell, pledge or otherwise
dispose of (or enter into any transaction or device which is designed to, or
could be expected to, result in the disposition by any person at any time in the
future of) any shares of Common Stock or securities convertible into or
exchangeable for Common Stock (other than the Stock to be sold by the Selling
Stockholders hereunder) or (2) enter into any swap or other derivatives
transaction that transfers to another, in whole or in part, any of the economic
benefits or risks of ownership of such shares of Common Stock, whether any such
transaction described in clause (1) or (2) above is to be settled by delivery of
Common Stock or other securities, in cash or otherwise, in each case without the
prior written consent of Xxxxxx Brothers Inc.
(b) That the Stock to be sold by the Selling Stockholder
hereunder, which is represented by the certificates held in custody for the
Selling Stockholder, is subject to the interest of the Underwriters and the
other Selling Stockholders hereunder, that the arrangements made by the Selling
Stockholder for such custody are to that extent irrevocable, and that the
obligations of the Selling Stockholder hereunder shall not be terminated by any
act of the Selling Stockholder, by operation of law or the occurrence of any
other event.
(c) To deliver to the Representatives prior to the First
Delivery Date a properly completed and executed United States Treasury
Department Form W-8 (if the Selling Stockholder is a non-United States person)
or Form W-9 (if the Selling Stockholder is a United States person).
SECTION 8. Expenses. The Company agrees to pay (a) the costs incident to
the sale and delivery of the Stock and any taxes payable in that connection; (b)
the costs incident to the preparation, printing and filing under the Securities
Act of the Registration Statement and any amendments and exhibits thereto; (c)
the costs of distributing the Registration Statement as originally filed and
each amendment thereto and any post-
15
effective amendments thereof (including, in each case, exhibits), any
Preliminary Prospectus, the Prospectus and any amendment or supplement to the
Prospectus or any document incorporated by reference therein, all as provided in
this Agreement; (d) the costs of producing and distributing this Agreement, and
any other related documents in connection with the offering, purchase, sale and
delivery of the stock; (e) the costs of delivering and distributing the Custody
Agreements and Powers of Attorney; (f) the filing fees incident to securing the
review by the National Association of Securities Dealers, Inc. of the terms of
sale of the Stock; (g) any applicable listing or other fees; (h) the fees and
expenses (not in excess, in the aggregate, of $10,000) of qualifying the Stock
under the securities laws of the several jurisdictions as provided in Section
6(h) and of preparing, printing and distributing a Blue Sky Memorandum
(including related fees and expenses of counsel to the Underwriters); (i) the
costs and expenses of the Company relating to investor presentations on any
"ROAD SHOW" undertaken in connection with the marketing of the offering of the
Stock, including, without limitation, expenses associated with the production of
road show slides and graphics, fees and expenses of any consultants engaged in
connection with the road show presentations with the prior approval of the
Company, travel and lodging expenses of the representatives and officers of the
Company and any such consultants, and the cost of any aircraft chartered in
connection with the road show; and (j) all other costs and expenses incident to
the performance of the obligations of the Company and the Selling Stockholders
under this Agreement; provided that, except as provided in this Section 8 and in
Section 13, the Underwriters shall pay their own costs and expenses, including
the fees and expenses of their counsel, any transfer taxes on the Stock that
they may sell and the expenses of advertising any offering of the Stock made by
the Underwriters.
SECTION 9. Conditions of Underwriters' Obligations. The respective
obligations of the Underwriters hereunder are subject to the accuracy, when made
and on each Delivery Date, of the representations and warranties of the Company
and the Selling Stockholders contained herein, to the performance by the Company
and the Selling Stockholders of their obligations hereunder, and to each of the
following additional terms and conditions:
(a) The Prospectus shall have been timely filed with the
Commission in accordance with Section 6(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 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.
(b) All corporate proceedings and other legal matters incident
to the authorization, form and validity of this Agreement, the Custody
Agreements, the Powers of Attorney, the Stock, the Registration Statement and
the Prospectus, and all other legal matters relating to this Agreement and the
transactions contemplated hereby shall be reasonably satisfactory in all
material respects to counsel for the Underwriters, the Company and the Selling
Stockholders shall have furnished to such counsel all
16
documents and information that they may reasonably request to enable them to
pass upon such matters.
(c) Xxxxxxx Xxxxxxx & Xxxxxxxx shall have furnished to the
Representatives its written opinion, as counsel to the Company, addressed to the
Underwriters and dated such Delivery Date, in form and substance reasonably
satisfactory to the Representatives, to the effect set forth in Exhibit B.
(d) The respective counsel for each of the Selling
Stockholders shall each have furnished to the Representatives its written
opinion, addressed to the Underwriters and dated the First Delivery Date, in
form and substance reasonably satisfactory to the Representatives, to the effect
that:
(i) Such Selling Stockholder has full right, power and authority
to enter into this Agreement, the Power of Attorney and the Custody
Agreement; the execution, delivery and performance of this Agreement,
the Power of Attorney and the Custody Agreement by such Selling
Stockholder and the consummation by such Selling Stockholder of the
transactions contemplated hereby and thereby will not conflict with or
result in a breach or violation of any of the terms or provisions of, or
constitute a default under, any statute, any indenture, mortgage, deed
of trust, loan agreement or other agreement or instrument known to such
counsel to which such Selling Stockholder is a party or by which such
Selling Stockholder is bound or to which any of the property or assets
of such Selling Stockholder is subject, nor will such actions result in
any violation of any partnership agreement, certificate of incorporation
or deed of trust of such Selling Stockholder or any statute or any
order, rule or regulation known to such counsel of any court or
governmental agency or body having jurisdiction over such Selling
Stockholder or the property or assets of such Selling Stockholder; and,
except for the registration of the Stock under the Securities Act and
such consents, approvals, authorizations, registrations or
qualifications as may be required under the Exchange Act and applicable
state securities laws in connection with the purchase and distribution
of the Stock by the Underwriters, no consent, approval, authorization or
order of, or filing or registration with, any such court or governmental
agency or body is required for the execution, delivery and performance
of this Agreement, the Power of Attorney or the Custody Agreement by
such Selling Stockholder and the consummation by such Selling
Stockholder of the transactions contemplated hereby and thereby;
(ii) This Agreement has been duly executed and delivered by or
on behalf of each Selling Stockholder;
(iii) A Power-of-Attorney and a Custody Agreement have been duly
executed and delivered by each Selling Stockholder and constitute valid
and binding agreements of each Selling Stockholder, enforceable in
accordance with their respective terms;
17
(iv) Immediately prior to the First Delivery Date, each Selling
Stockholder had a security entitlement with respect to the shares of
Stock to be sold by the Selling Stockholder under this Agreement free
and clear of all liens, encumbrances, equities or claims and full right,
power and authority to sell, assign, transfer and deliver such shares to
be sold by the Selling Stockholder hereunder; and
(v) A security entitlement with respect to the shares of Stock
to be sold by each Selling Stockholder under this Agreement, has been
transferred to each of the several Underwriters and no action based on
an adverse claim may be asserted against the Underwriters with respect
to such offered securities.
In rendering such opinion, such counsel may (i) state that its opinion is
limited to matters governed by the Federal laws of the United States of America,
the laws of the State of New York and the general corporate or partnership law,
as the case may be, of the state of the Selling Stockholder's incorporation or
organization, as the case may be, and that such counsel is not admitted in the
jurisdiction in which the Selling Stockholder is incorporated or organized, as
the case may be, and (ii) in rendering the opinion in Section 9(d)(iv) above,
rely upon a certificate of such Selling Stockholder in respect of matters of
fact as to ownership of and liens, encumbrances, equities or claims on the
shares of Stock sold by such Selling Stockholder, provided that such counsel
shall furnish copies thereof to the Representatives and state that such counsel
believes that both the Underwriters and such counsel are justified in relying
upon such certificate. In the case of the opinion delivered for each of the
Xxxxxx Selling Stockholders and Co-Investment Partners, L.P., such counsel shall
also have furnished to the Representatives a written statement, addressed to the
Underwriters and dated the First Delivery Date, in form and substance
satisfactory to the Representatives, to the effect that (x) such counsel has
acted as counsel to such Selling Stockholder in connection with the preparation
of the Registration Statement and, with respect to Co-Investment Partners, L.P.,
has acted as its counsel on a regular basis, and (y) based on the foregoing, no
facts have come to the attention of such counsel that lead it to believe that
the Registration Statement, as of the Effective Date, contained any untrue
statement of a material fact relating to such Selling Stockholder or omitted to
state such a material fact required to be stated therein or necessary in order
to make the statements therein not misleading, or that the Prospectus contains
any untrue statement of a material fact relating to such Selling Stockholder or
omits to state such a material fact necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading. The foregoing opinion and statement may be qualified by a statement
to the effect that such counsel does not assume any responsibility for the
accuracy, completeness or fairness of the statements contained in the
Registration Statement or the Prospectus.
(e) The Representatives shall have received from Weil, Gotshal
& Xxxxxx LLP, counsel for the Underwriters, such opinion or opinions, dated such
Delivery Date, with respect to the issuance and sale of the Stock, the
Registration Statement, the Prospectus and other related matters as the
Representatives may reasonably require, and the Company shall have furnished to
such counsel such
18
documents as they reasonably request for the purpose of enabling them to pass
upon such matters.
(f) At the time of execution of this Agreement, the
Representatives shall have received from Ernst & Young LLP a letter or letters,
in form and substance satisfactory to the Representatives, addressed to the
Underwriters and dated the date hereof (i) confirming that they are independent
public accountants within the meaning of the Securities Act and are in
compliance with the applicable requirements relating to the qualification of
accountants under Rule 2-01 of Regulation S-X of the Commission and (ii)
stating, as of the date hereof (or, with respect to matters involving changes or
developments since the respective dates as of which specified financial
information is given in the Prospectus, as of a date not more than five days
prior to the date hereof), the conclusions and findings of such firm with
respect to the financial information and other matters ordinarily covered by
accountants' "comfort letters" to underwriters in connection with registered
public offerings.
(g) With respect to the letter or letters of Ernst & Young LLP
referred to in the preceding paragraph and delivered to the Representatives
concurrently with the execution of this Agreement (the "INITIAL LETTERS"), the
Representatives shall have received from Ernst & Young LLP a letter (the
"BRING-DOWN LETTER"), addressed to the Underwriters and dated such Delivery Date
(i) confirming that they are independent public accountants within the meaning
of the Securities Act and are in compliance with the applicable requirements
relating to the qualification of accountants under Rule 2-01 of Regulation S-X
of the Commission, (ii) stating, as of the date of the bring-down letter (or,
with respect to matters involving changes or developments since the respective
dates as of which specified financial information is given in the Prospectus, as
of a date not more than five days prior to the date of the bring-down letter),
the conclusions and findings of such firm with respect to the financial
information and other matters covered by the initial letters, and (iii)
confirming in all material respects the conclusions and findings set forth in
the initial letters.
(h) The Company shall have furnished to the Representatives a
certificate, dated such Delivery Date, of its Chairman of the Board, its
President or a Vice President and its Chief Financial Officer stating that:
(i) The representations, warranties and agreements of
the Company in Section 1 are true and correct as of such Delivery Date;
the Company has complied in all material respects with all its
agreements contained herein; and the conditions set forth in Sections
9(a), 9(j) and 9(k) have been fulfilled; and
(ii) They have carefully examined the Registration
Statement and the Prospectus and, in their opinion (A) as of the
Effective Date, the Registration Statement and Prospectus did not
include any 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 (with respect to the Prospectus,
in light of the circumstances under which they were made), and (B)
19
since the Effective Date no event has occurred that should have been set
forth in a supplement or amendment to the Registration Statement or the
Prospectus.
(i) Each Selling Stockholder (or one or more attorneys-in-fact
on behalf of the Selling Stockholders) shall have furnished to the
Representatives on the First Delivery Date a certificate, dated the First
Delivery Date, signed by, or on behalf of, the Selling Stockholder (or one or
more attorneys-in-fact) stating that the representations, warranties and
agreements of the Selling Stockholder contained herein are true and correct as
of the First Delivery Date and that the Selling Stockholder has complied with
all agreements contained herein to be performed by the Selling Stockholder at or
prior to the First Delivery Date.
(j) Neither the Company nor any of its subsidiaries shall have
sustained since the date of the latest audited financial statements included or
incorporated by reference in the Prospectus (A) any loss or interference with
its business from fire, explosion, flood or other calamity, whether or not
covered by insurance, or from any labor dispute or court or governmental action,
order or decree, otherwise than as set forth or contemplated in the Prospectus
or (B) since such date there shall not have been any material change in the
capital stock or material increase in the long-term debt of the Company or any
of its subsidiaries or any change in or affecting the general affairs,
management, financial position, stockholders' equity or results of operations of
the Company and its subsidiaries, otherwise than as set forth or contemplated in
the Prospectus, the effect of which, in any such case described in clause (A) or
(B), is, in the judgment of the Representatives, so material and adverse as to
make it impracticable or inadvisable to proceed with the public offering or the
delivery of the Stock being delivered on such Delivery Date on the terms and in
the manner contemplated in the Prospectus.
(k) Subsequent to the execution and delivery of this Agreement
(i) no downgrading shall have occurred in the rating accorded the Company's debt
securities by any "nationally recognized statistical rating organization," as
that term is defined by the Commission for purposes of Rule 436(g)(2) of the
Rules and Regulations and (ii) no 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.
(l) Subsequent to the execution and delivery of this Agreement
there shall not have occurred any of the following: (i) trading in securities
generally on the New York Stock Exchange or the American Stock Exchange or in
the over-the-counter market, or trading in any securities of the Company on any
exchange or in the over-the-counter market, shall have been suspended or the
settlement of such trading generally shall have been materially disrupted or
minimum prices shall have been established on any such exchange or such market
by the Commission, by such exchange or by any other regulatory body or
governmental authority having jurisdiction, (ii) a banking moratorium shall have
been declared by Federal or state authorities, (iii) the United States shall
have become engaged in hostilities, there shall have been an escalation in
hostilities involving the United States or there shall have been a declaration
of a national emergency or war by
20
the United States, or (iv) there shall have occurred such a material adverse
change in general economic, political or financial conditions, including without
limitation as a result of terrorist activities after the date hereof, or the
effect of international conditions on the financial markets in the United States
shall be such, as to make it, in the judgment of the Representatives,
impracticable or inadvisable to proceed with the public offering or delivery of
the Stock being delivered on such Delivery Date on the terms and in the manner
contemplated in the Prospectus.
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 counsel for the Underwriters.
SECTION 10. Indemnification and Contribution.
(a) The Company shall indemnify and hold harmless each
Underwriter, its officers and employees and each person, if any, who controls
any Underwriter within the meaning of either Section 15 of the Securities Act or
Section 20 of the Exchange Act, from and against any loss, claim, damage or
liability, joint or several, or any action in respect thereof (including, but
not limited to, any loss, claim, damage, liability or action relating to
purchases and sales of Stock), to which that Underwriter, officer, employee or
controlling person may become subject, under the Securities Act or otherwise,
insofar as such loss, claim, damage, liability or action arises out of, or is
based upon, (i) any untrue statement or alleged untrue statement of a material
fact contained (A) in any Preliminary Prospectus, the Registration Statement or
the Prospectus or in any amendment or supplement thereto, or (B) in any
materials or information provided to investors by, or with the approval of, the
Company in connection with the marketing of the offering of the Stock
("MARKETING MATERIALS"), including any road show or investor presentations made
to investors by the Company (whether in person or electronically), (ii) the
omission or alleged omission to state in any Preliminary Prospectus, the
Registration Statement or the Prospectus, or in any amendment or supplement
thereto, or in any Marketing Materials, any material fact required to be stated
therein or necessary to make the statements therein not misleading, or (iii) any
act or failure to act or any alleged act or failure to act by any Underwriter in
connection with, or relating in any manner to, the Stock or the offering
contemplated hereby, and that is included as part of or referred to in any loss,
claim, damage, liability or action arising out of or based upon matters covered
by clause (i) or (ii) above (provided that the Company shall not be liable under
this clause (iii) to the extent that it is determined in a final judgment by a
court of competent jurisdiction that such loss, claim, damage, liability or
action resulted directly from any such acts or failures to act undertaken or
omitted to be taken by such Underwriter through its gross negligence or willful
misconduct), and shall reimburse each Underwriter and each such officer,
employee or controlling person promptly upon demand for any legal or other
expenses reasonably incurred by that Underwriter, officer, employee or
controlling person in connection with investigating or defending or preparing to
defend against any such loss, claim, damage, liability or action as such
expenses are incurred; provided, however, that the Company shall not be liable
in
21
any such case to the extent that any such loss, claim, damage, liability or
action (i) arises out of, or is based upon, any untrue statement or alleged
untrue statement or omission or alleged omission made in any Preliminary
Prospectus, the Registration Statement or the Prospectus, or in any such
amendment or supplement, in reliance upon and in conformity with written
information concerning such Underwriter furnished to the Company through the
Representatives by or on behalf of any Underwriter specifically for inclusion
therein which information consists solely of the information specified in
Section 10(f); or (ii) results solely from an untrue statement of material fact
contained in, or the omission of a material fact from, such preliminary
prospectus, which untrue statement or omission was corrected in the Prospectus
(as then amended or supplemented) if the Company shall sustain the burden of
proving that the Underwriters sold Shares to the person alleging such loss,
claim, damage, liability or action without sending or giving, at or prior to the
written confirmation of such sale, a copy of the Prospectus (as then amended or
supplemented) if the Company had previously furnished copies thereof to the
Underwriters within a reasonable amount of time prior to such sale or such
confirmation, and the Underwriters failed to deliver the corrected Prospectus,
if required by law to have so delivered it and if delivered would have cured the
defect giving rise to such loss, claim, damage, liability or action. The
foregoing indemnity agreement is in addition to any liability that the Company
may otherwise have to any Underwriter or to any officer, employee or controlling
person of that Underwriter.
(b) Each Selling Stockholder, severally and not jointly, shall
indemnify and hold harmless each of the Company and each Underwriter, its
officers and employees and each person, if any, who controls the Company or any
Underwriter within the meaning of Section 15 of the Securities Act, from and
against any loss, claim, damage or liability (including, without limitation, any
legal or other expenses reasonably incurred in connection with defending or
investigating any such action or claim), or any action in respect thereof
(including, but not limited to, any loss, claim, damage or liability or action
relating to purchases and sales of Stock), to which the Company or that
Underwriter, officer, employee or controlling person may become subject, insofar
as such loss, claim, damage, liability or action arises out of, or is based
upon, (i) any untrue statement or alleged untrue statement of a material fact
contained in any Preliminary Prospectus, the Registration Statement or the
Prospectus or in any amendment or supplement thereto or (ii) the omission or
alleged omission to state in any Preliminary Prospectus, the Registration
Statement or the Prospectus, or in any amendment or supplement thereto, any
material fact required to be stated therein or necessary to make the statements
therein not misleading, but in each case only to the extent that the untrue
statement or alleged untrue statement or the omission or alleged omission: (x)
relates to information under the caption "Selling Stockholders" relating to such
Selling Stockholder; or (y) was made in conformity with written information
concerning such Selling Stockholder furnished to the Company by or on behalf of
that Selling Stockholder specifically for inclusion therein; provided, however,
that the indemnification contained in this paragraph (b) with respect to the
Preliminary Prospectus shall not inure to the benefit of the Company or any
Underwriter (or to the benefit of any officers or employees of the Company or
any Underwriter or of any person controlling the Company or such Underwriter) on
account
22
of any such loss, claim, damage, liability or action arising from the sale of
Stock by such Underwriter to any person if the untrue statement or alleged
untrue statement or omission or alleged omission of a material fact contained in
the Preliminary Prospectus was corrected in the Prospectus and the Underwriter
sold Stock to that person without sending or giving at or prior to the written
confirmation of such sale, a copy of the Prospectus (as then amended or
supplemented) if the Company has previously furnished sufficient copies thereof
to the Underwriter on a timely basis to permit such sending or giving. The
foregoing indemnity agreement is in addition to any liability which the Selling
Stockholders may otherwise have to the Company or any Underwriter or any
officer, employee or controlling person of the Company or that Underwriter.
Notwithstanding any other provision of this Agreement, the liability of each
Selling Stockholder under this Section 10(b) to all such indemnified parties and
under Section 2(e) shall not exceed the net amount received by each such Selling
Stockholder (after deducting any underwriting discount) from the sale of the
Stock pursuant to this Agreement.
(c) Each Underwriter, severally and not jointly, shall
indemnify and hold harmless the Company, the Selling Stockholders, the Company's
officers and employees, each of its directors, and each person, if any, who
controls the Company within the meaning of the Securities Act, from and against
any loss, claim, damage or liability, joint or several, or any action in respect
thereof, to which the Company or any such director, officer or controlling
person may become subject, under the Securities Act or otherwise, insofar as
such loss, claim, damage, liability or action arises out of, or is based upon,
(i) any untrue statement or alleged untrue statement of a material fact
contained in any Preliminary Prospectus, the Registration Statement or the
Prospectus or in any amendment or supplement thereto, or (ii) the omission or
alleged omission to state in any Preliminary Prospectus, the Registration
Statement or the Prospectus, or in any amendment or supplement thereto, any
material fact required to be stated therein or necessary to make the statements
therein not misleading, but in each case only to the extent that the untrue
statement or alleged untrue statement or omission or alleged omission was made
in reliance upon and in conformity with written information concerning such
Underwriter furnished to the Company through the Representatives by or on behalf
of that Underwriter specifically for inclusion therein, and shall reimburse the
Company and any such director, officer or controlling person for any legal or
other expenses reasonably incurred by the Company or any such director, officer
or controlling person in connection with investigating or defending or preparing
to defend against any such loss, claim, damage, liability or action as such
expenses are incurred. The foregoing indemnity agreement is in addition to any
liability that any Underwriter may otherwise have to the Company or any such
director, officer, employee or controlling person.
(d) Promptly after receipt by an indemnified party under this
Section 10 of notice of any claim or the commencement of any action, the
indemnified party shall, if a claim in respect thereof is to be made against the
indemnifying party under this Section 10, notify the indemnifying party in
writing of the claim or the commencement of that action; provided, however, that
the failure to notify the indemnifying party shall not relieve it from any
liability that it may have under this
23
Section 10 except to the extent it has been materially prejudiced by such
failure and, provided further, that the failure to notify the indemnifying party
shall not relieve it from any liability that it may have to an indemnified party
otherwise than under this Section 10. If any such claim or action shall be
brought against an indemnified party, and it shall notify the indemnifying party
thereof, the indemnifying party shall be entitled to participate therein and, to
the extent that it wishes, jointly with any other similarly notified
indemnifying party, to assume the defense thereof with counsel reasonably
satisfactory to the indemnified party. After notice from the indemnifying party
to the indemnified party of its election to assume the defense of such claim or
action, the indemnifying party shall not be liable to the indemnified party
under this Section 10 for any legal or other expenses subsequently incurred by
the indemnified party in connection with the defense thereof other than
reasonable costs of investigation; provided, however, that the Representatives
shall have the right to employ counsel to represent jointly the Representatives
and those other Underwriters and their respective officers, employees and
controlling persons who may be subject to liability arising out of any claim in
respect of which indemnity may be sought by the Underwriters against the Company
or any Selling Stockholder under this Section 10 if, in the reasonable judgment
of the Representatives, it is advisable for the Representatives and those
Underwriters, officers, employees and controlling persons to be jointly
represented by separate counsel, and in that event the reasonable fees and
expenses of such separate counsel shall be paid by the Company or any Selling
Stockholder. No indemnifying party shall (i) without the prior written consent
of the indemnified parties (which consent shall not be unreasonably withheld),
settle or compromise or consent to the entry of any judgment with respect to any
pending or threatened claim, action, suit or proceeding in respect of which
indemnification or contribution may be sought hereunder (whether or not the
indemnified parties are actual or potential parties to such claim or action)
unless such settlement, compromise or consent includes an unconditional release
of each indemnified party from all liability arising out of such claim, action,
suit or proceeding, or (ii) be liable for any settlement of any such action
effected without its written consent (which consent shall not be unreasonably
withheld), but if settled with the consent of the indemnifying party or if there
be a final judgment of the plaintiff in any such action, the indemnifying party
agrees to indemnify and hold harmless any indemnified party from and against any
loss or liability by reason of such settlement or judgment.
(e) If the indemnification provided for in this Section 10
shall for any reason be unavailable to or insufficient to hold harmless an
indemnified party under Section 10(a), 10(b) or 10(c) in respect of any loss,
claim, damage or liability, or any action in respect thereof, referred to
therein, then each indemnifying party shall, in lieu of indemnifying such
indemnified party, contribute to the amount paid or payable by such indemnified
party as a result of such loss, claim, damage or liability, or action in respect
thereof, (i) in such proportion as shall be appropriate to reflect the relative
benefits received by the Company and the Selling Stockholders on the one hand
and the Underwriters on the other from the offering of the Stock or (ii) if the
allocation provided by clause (i) above is not permitted by applicable law, in
such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also
24
the relative fault of the Company and the Selling Stockholder on the one hand
and the Underwriters on the other with respect to the statements or omissions
that resulted in such loss, claim, damage or liability, or action in respect
thereof, as well as any other relevant equitable considerations. The relative
benefits received by the Company and the Selling Stockholders on the one hand
and the Underwriters on the other with respect to such offering shall be deemed
to be in the same proportion as the total net proceeds from the offering of the
Stock purchased under this Agreement (before deducting expenses) received by the
Company and the Selling Stockholders, on the one hand, and the total
underwriting discounts and commissions received by the Underwriters with respect
to the shares of the Stock purchased under this Agreement, on the other hand,
bear to the total gross proceeds from the offering of the Stock under this
Agreement, in each case as set forth in the table on the cover page of the
Prospectus. The relative fault shall be determined by reference to whether the
untrue or alleged untrue statement of a material fact or omission or alleged
omission to state a material fact relates to information supplied by the
Company, the Selling Stockholder or the Underwriters, the intent of the parties
and their relative knowledge, access to information and opportunity to correct
or prevent such statement or omission. The Company, the Selling Stockholder and
the Underwriters agree that it would not be just and equitable if contributions
pursuant to this Section 10 were to be determined by pro rata allocation (even
if the Underwriters were treated as one entity for such purpose) or by any other
method of allocation that does not take into account the equitable
considerations referred to herein. The amount paid or payable by an indemnified
party as a result of the loss, claim, damage or liability, or action in respect
thereof, referred to above in this Section 10 shall be deemed to include, for
purposes of this Section 10(e), any legal or other expenses reasonably incurred
by such indemnified party in connection with investigating or defending any such
action or claim. Notwithstanding the provisions of this Section 10(e), no
Underwriter shall be required to contribute any amount in excess of the amount
by which the total price at which the Stock underwritten by it and distributed
to the public was offered to the public exceeds the amount of any damages that
such Underwriter has otherwise paid or become liable to pay by reason of any
untrue or alleged untrue statement or omission or alleged omission. No person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Securities Act) shall be entitled to contribution from any person who was
not guilty of such fraudulent misrepresentation. The Underwriters' obligations
to contribute as provided in this Section 10(e) are several in proportion to
their respective underwriting obligations and not joint.
(f) The Underwriters severally confirm and the Company
acknowledges that the statements with respect to the public offering of the
Stock by the Underwriters set forth on the cover page of, the fourth, eighth,
ninth and twentieth paragraphs appearing under the caption "Underwriting" in,
the Prospectus are correct and constitute the only information concerning such
Underwriters furnished in writing to the Company by or on behalf of the
Underwriters specifically for inclusion in the Registration Statement and the
Prospectus.
25
SECTION 11. Defaulting Underwriters. If, on either Delivery Date, any
Underwriter defaults in the performance of its obligations under this Agreement,
the remaining non-defaulting Underwriters shall be obligated to purchase the
Stock that the defaulting Underwriter agreed but failed to purchase on such
Delivery Date in the respective proportions that the number of shares of the
Firm Stock set opposite the name of each remaining non-defaulting Underwriter in
Schedule 1 hereto bears to the total number of shares of the Firm Stock set
opposite the names of all the remaining non-defaulting Underwriters in Schedule
1 hereto; provided, however, that the remaining non-defaulting Underwriters
shall not be obligated to purchase any of the Stock on such Delivery Date if the
total number of shares of the Stock that the defaulting Underwriter or
Underwriters agreed but failed to purchase on such date exceeds 9.09% of the
total number of shares of the Stock to be purchased on such Delivery Date, and
any remaining non-defaulting Underwriter shall not be obligated to purchase more
than 110% of the number of shares of the Stock that it agreed to purchase on
such Delivery Date pursuant to the terms of Section 4. If the foregoing maximums
are exceeded, the remaining non-defaulting Underwriters, or those other
underwriters satisfactory to the Representatives who so agree, shall have the
right, but shall not be obligated, to purchase, in such proportion as may be
agreed upon among them, all the Stock to be purchased on such Delivery Date. If
the remaining Underwriters or other underwriters satisfactory to the
Representatives do not elect to purchase the shares that the defaulting
Underwriter or Underwriters agreed but failed to purchase on such Delivery Date,
this Agreement (or, with respect to the Second Delivery Date, the obligation of
the Underwriters to purchase, and of the Selling Stockholders to sell, the
Option Stock) shall terminate without liability on the part of any
non-defaulting Underwriter or the Selling Stockholders, except that the Company
and the Selling Stockholders will continue to be liable for the payment of
expenses to the extent set forth in Sections 8 and 13. As used in this
Agreement, the term "UNDERWRITER" includes, for all purposes of this Agreement
unless the context requires otherwise, any party not listed in Schedule 1 hereto
who, pursuant to this Section 11, purchases Stock that a defaulting Underwriter
agreed to, but failed to, purchase.
Nothing contained herein shall relieve a defaulting
Underwriter of any liability it may have to the Selling Stockholders for damages
caused by its default. If other underwriters are obligated or agree to purchase
the Stock of a defaulting or withdrawing Underwriter, either the Representatives
or the Company may postpone the Delivery Date for up to seven full business days
in order to effect any changes that in the opinion of counsel for the Company or
counsel for the Underwriters may be necessary in the Registration Statement, the
Prospectus or in any other document or arrangement.
SECTION 12. Termination. The obligations of the Underwriters hereunder
may be terminated by the Representatives by notice given to and received by the
Selling Stockholders prior to delivery of and payment for the Firm Stock if,
prior to that time, any of the events described in Sections 9(j), 9(k) or 9(l),
shall have occurred or if the Underwriters shall decline to purchase the Stock
for any reason permitted under this Agreement.
26
Section 13. Reimbursement of Underwriters' Expense. If the
Selling Stockholders shall fail to tender the Stock for delivery to the
Underwriters by reason of any failure, refusal or inability on the part of the
Selling Stockholders to perform any agreement on its part to be performed, or
because any other condition of the Underwriters' obligations hereunder required
to be fulfilled by the Selling Stockholders (including, without limitation, with
respect to the transactions) is not fulfilled, the Selling Stockholders will
reimburse the Underwriters for all reasonable out-of-pocket expenses (including
fees and disbursements of counsel) incurred by the Underwriters in connection
with this Agreement and the proposed purchase of the Stock, and upon demand the
Selling Stockholders shall pay the full amount thereof to the Representatives.
If this Agreement is terminated pursuant to Section 11 by reason of the default
of one or more Underwriters, the Selling Stockholders shall not be obligated to
reimburse any defaulting Underwriter on account of those expenses.
Section 14. Notices, Etc. All statements, requests, notices and
agreements hereunder shall be in writing, and:
(a) if to the Underwriters, shall be delivered or sent by mail,
telex or facsimile transmission to Xxxxxx Brothers Inc., 000 Xxxxxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000, Attention: Syndicate Department (Fax: 000-000-0000), with
a copy, in the case of any notice pursuant to Section 10(d), to the Director of
Litigation, Office of the General Counsel, Xxxxxx Brothers Inc., 000 Xxxxxxx
Xxxxxx, Xxx Xxxx, XX 00000;
(b) if to the Company, shall be delivered or sent by mail, telex
or facsimile transmission to the address of the Company set forth in the
Registration Statement, Attention: Chief Financial Officer (Fax: 000-000-0000);
(c) if to a Selling Stockholder, shall be delivered or sent by
mail, telex or facsimile transmission to such Selling Stockholder at the address
set forth on Schedule 2 hereto.
provided, however, that any notice to an Underwriter pursuant to Section 10(d)
shall be delivered or sent by mail, telex or facsimile transmission to such
Underwriter at its address set forth in its acceptance telex 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. The Company and the
Selling Stockholders shall be entitled to act and rely upon any request,
consent, notice or agreement given or made on behalf of the Underwriters by
Xxxxxx Brothers Inc. on behalf of the Representatives.
Section 15. Persons Entitled to Benefit of Agreement. This
Agreement shall inure to the benefit of and be binding upon the Underwriters,
the Company, the Selling Stockholders, and their respective successors. This
Agreement and the terms and provisions hereof 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 shall also be deemed to be
for the benefit of the person or persons, if any,
27
who control any Underwriter within the meaning of Section 15 of the Securities
Act and (B) the indemnity agreement of the Underwriters contained in Section
10(c) of this Agreement shall be deemed to be for the benefit of directors of
the Company, its officers and employees and any person controlling the Company
within the meaning of Section 15 of the Securities Act. Nothing in this
Agreement is intended or shall be construed to give any person, other than the
persons referred to in this Section 15, any legal or equitable right, remedy or
claim under or in respect of this Agreement or any provision contained herein.
Section 16. Survival. The respective indemnities,
representations, warranties and agreements of the Company, the Selling
Stockholders and the Underwriters contained in this Agreement or made by or on
behalf on them, respectively, pursuant to this Agreement, shall survive the
delivery of and payment for the Stock and shall remain in full force and effect,
regardless of any investigation made by or on behalf of any of them or any
person controlling any of them.
Section 17. Definition of the Terms "BUSINESS DAY" and
"SUBSIDIARY." For purposes of this Agreement, (a) "BUSINESS DAY" means each
Monday, Tuesday, Wednesday, Thursday or Friday that is not a day on which
banking institutions in New York are generally authorized or obligated by law or
executive order to close and (b) "SUBSIDIARY" has the meaning set forth in Rule
405 of the Rules and Regulations.
Section 18. Governing Law. This Agreement shall be governed by
and construed in accordance with the laws of New York.
Section 19. Counterparts. This Agreement may be executed in one
or more counterparts and, if executed in more than one counterpart, the executed
counterparts shall each be deemed to be an original but all such counterparts
shall together constitute one and the same instrument.
Section 20. 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.
28
If the foregoing correctly sets forth the agreement between
the Company, the Selling Stockholders and the Underwriters, please indicate your
acceptance in the space provided for that purpose below.
Very truly yours,
PEABODY ENERGY CORPORATION
By: /s/ Xxxxxxx X. Xxxxxxx
-----------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Vice President-Legal Services
Accepted:
XXXXXX BROTHERS INC.
BEAR, XXXXXXX & CO. INC.
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX INCORPORATED
XXXXXX XXXXXXX & CO. INCORPORATED
UBS WARBURG LLC
X.X. XXXXXXX & SONS, INC.
For themselves and as Representatives
of the several Underwriters named
in Schedule 1 hereto
By XXXXXX BROTHERS INC.
By /s/ Xxxxxx Xxxxxxxxx
---------------------
Authorized Representative
The Selling Stockholders named
in Schedule 2 to this Agreement
(other than the Xxxxxx Selling Stockholders)
By: /s/ Xxxxxxx X. Xxxxxxx
------------------------
Attorney-in-fact
The Xxxxxx Selling Stockholders
By: /s/Xxxxxx XxxXxxxxxx
--------------------------
Attorney-in-fact
SCHEDULE 1
Number of Shares of
Underwriters Firm Stock to be Purchased
------------ --------------------------
Xxxxxx Brothers Inc............................... 1,620,000
Bear, Xxxxxxx & Co. Inc........................... 1,620,000
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated 1,620,000
Xxxxxx Xxxxxxx & Co. Incorporated................. 1,620,000
UBS Warburg LLC................................... 1,620,000
X.X. Xxxxxxx & Sons, Inc.......................... 900,000
---------
Total............................................. 9,000,000
=========
SCHEDULE 2
Selling Stockholders Number of Shares
-------------------- ----------------
Xxxxxx Brothers Merchant Banking 7,967,000
Partners II L.P. and affiliates
c/x Xxxxxx Brothers Holdings Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Co-Investment Partners, L.P. 1,000,000
c/o Lexington Partners Inc.
000 Xxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Xxxxxx X. Xxxxxx Trust 10,000
c/o Peabody Energy Corporation
000 Xxxxxx Xxxxxx
Xx. Xxxxx, Xxxxxxxx 00000
Xxxx X. Xxxxxx 8,000
c/o Peabody Energy Corporation
000 Xxxxxx Xxxxxx
Xx. Xxxxx, Xxxxxxxx 00000
Xxxxx X. Xxxxxxx, Xx. Revocable Trust U/T/A 10,000
c/o Peabody Energy Corporation
000 Xxxxxx Xxxxxx
Xx. Xxxxx, Xxxxxxxx 00000
Indenture of Trust of Xxxxxxx X. Xxxxxxx 5,000
c/o Peabody Energy Corporation
000 Xxxxxx Xxxxxx
Xx. Xxxxx, Xxxxxxxx 00000
EXHIBIT A
LOCK-UP LETTER AGREEMENT
XXXXXX BROTHERS INC.
BEAR, XXXXXXX & CO. INC.
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX INCORPORATED
XXXXXX XXXXXXX & CO. INCORPORATED
UBS WARBURG LLC
X.X. XXXXXXX & SONS, INC.
As Representatives of the several
Underwriters named in Schedule 1,
c/x Xxxxxx Brothers Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
The undersigned understands that you and certain other firms
propose to enter into an Underwriting Agreement (the "UNDERWRITING AGREEMENT")
providing for the purchase by you and such other firms (the "UNDERWRITERS") of
shares (the "SHARES") of Common Stock, par value $0.01 per share (the "COMMON
STOCK"), of Peabody Energy Corporation, a Delaware corporation (the "COMPANY")
from the Selling Stockholders named in Schedule 2 to the Underwriting Agreement
(the "Selling Stockholders"), and that the Underwriters propose to reoffer the
Shares to the public (the "OFFERING").
In consideration of the execution of the Underwriting
Agreement by the Underwriters, and for other good and valuable consideration,
the undersigned hereby irrevocably agrees that, without the prior written
consent of Xxxxxx Brothers Inc., on behalf of the Underwriters, the undersigned
will not, directly or indirectly, (1) offer for sale, sell, pledge, or otherwise
dispose of (or enter into any transaction or device that is designed to, or
could be expected to, result in the disposition by any person at any time in the
future of) any shares of Common Stock (including, without limitation, shares of
Common Stock that may be deemed to be beneficially owned by the undersigned in
accordance with the rules and regulations of the Securities and Exchange
Commission and shares of Common Stock that may be issued upon exercise of any
option or warrant) or securities convertible into or exchangeable for Common
Stock owned by the undersigned on the date of execution of this Lock-Up Letter
Agreement or on the date of the completion of the Offering, or (2) enter into
any swap or other derivatives transaction that transfers to another, in whole or
in part, any of the economic benefits or risks of ownership of such shares of
Common Stock, whether any such transaction described in clause (1) or (2) above
is to be settled by delivery of Common Stock or other securities, in cash or
otherwise, for a period of 45 days after the date of the final Prospectus
relating
B-1
to the Offering, except with respect to shares of Common Stock sold pursuant to
the Underwriting Agreement.
Notwithstanding the foregoing, gifts or transfers to (A) the
undersigned's immediate family or (B) a trust or partnership the beneficiary and
sole partners of which are members of the undersigned's immediate family and/or
the undersigned, shall not be prohibited by this agreement if the donee or
transferee agrees in writing to be bound by the foregoing in the same manner as
it applies to the undersigned. In addition, this agreement shall not prohibit
the exercise of any stock options or warrants, or rights relating to the
conversion of convertible debt, except that the shares of Common Stock obtained
upon any such exercise shall be subject to the limitations on disposition
herein.
In furtherance of the foregoing, the Company and its Transfer
Agent are hereby authorized to decline to make any transfer of securities if
such transfer would constitute a violation or breach of this Lock-Up Letter
Agreement.
It is understood that, if the Company notifies you that it
does not intend to proceed with the Offering, if the Underwriting Agreement does
not become effective, or if the Underwriting Agreement (other than the
provisions thereof which survive termination) shall terminate or be terminated
prior to payment for and delivery of the Shares, we will be released from our
obligations under this Lock-Up Letter Agreement.
The undersigned understands that the Company and the
Underwriters will proceed with the Offering in reliance on this Lock-Up Letter
Agreement.
Whether or not the Offering actually occurs depends on a
number of factors, including market conditions. Any Offering will only be made
pursuant to an Underwriting Agreement, the terms of which are subject to
negotiation between the Company and the Underwriters.
The undersigned hereby represents and warrants that the
undersigned has full power and authority to enter into this Lock-Up Letter
Agreement and that, upon request, the undersigned will execute any additional
documents necessary in connection with the enforcement hereof. Any obligations
of the undersigned shall be binding upon the heirs, personal representatives,
successors and assigns of the undersigned.
Very truly yours,
By:______________________________
Name:
Title:
Dated: _______________
B-2
