Exhibit 1.1
Execution Copy
Constar International Inc.
10,500,000 Shares*
Common Stock
$0.01 par value
Underwriting Agreement
New York, New York
November 14, 2002
Xxxxxxx Xxxxx Xxxxxx Inc.
Deutsche Bank Securities Inc.
X.X. Xxxxxx Securities Inc.
As Representatives of the
several Underwriters
c/o Xxxxxxx Xxxxx Xxxxxx Inc.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Crown Cork & Seal Company, Inc., a corporation organized under the
laws of the Commonwealth of Pennsylvania (the "Selling Securityholder"),
proposes to sell to the several underwriters named in Schedule I hereto (the
"Underwriters"), for whom you (the "Representatives") are acting as
representatives, 10,500,000 shares of common stock, $0.01 par value ("Common
Stock"), of Constar International Inc., a corporation organized under the laws
of Delaware (the "Company") (such shares of Common Stock being sold by the
Selling Securityholder pursuant to this agreement together with the Incremental
Shares (as defined below) are hereinafter called the "Underwritten Securities").
The Selling Securityholder also proposes to sell to the several Underwriters
1,500,000 additional shares of Common Stock pursuant to this Agreement (such
shares, the "Incremental Shares") that will be subject to a repurchase
obligation described herein. The Selling Securityholder also proposes to grant
to the
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* Plus 1,500,000 additional shares to be sold by the Company subject to a
commitment by the Company to repurchase and plus an option to purchase from
the Company up to 1,500,000 additional shares to cover over-allotments.
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Underwriters an option to purchase up to 1,500,000 additional shares of Common
Stock to cover over-allotments (the "Option Securities"; the Option Securities,
together with the Underwritten Securities, being hereinafter called the
"Securities").
It is understood that, following consummation of the aforementioned
repurchase commitment, the Incremental Shares may be used by the Selling
Securityholder in satisfaction of any obligation by it to deliver Option
Securities.
To the extent there are no additional Underwriters listed on Schedule I
hereto other than you, the term Representatives as used herein shall mean you,
as Underwriters, and the terms Representatives and Underwriters shall mean
either the singular or plural as the context requires. The use of the neuter in
this Agreement shall include the feminine and masculine wherever appropriate.
Certain terms used herein are defined in Section 17 hereof.
Concurrently with the offering of the Securities, it is understood that
the Company is offering to sell $175,000,000 million of its 11% senior
subordinated notes due 2012 pursuant to a prospectus dated November 15, 2002
(the "Senior Subordinated Notes Offering").
As part of the offering contemplated by this Agreement, Xxxxxxx Xxxxx
Xxxxxx Inc. agrees to reserve out of the Underwritten Securities set forth
opposite its name on Schedule I to this Agreement, up to 480,000 shares, for
sale to certain employees, directors and other persons designated by the Company
in amounts designated by the Company (collectively, "Participants"), as set
forth in the Prospectus under the heading "Underwriting" (the "Directed Share
Program"). The Securities to be sold by Xxxxxxx Xxxxx Barney Inc. pursuant to
the Directed Share Program (the "Directed Shares") will be sold by Xxxxxxx Xxxxx
Xxxxxx Inc. pursuant to this Agreement at the public offering price. Any
Directed Shares not orally confirmed for purchase by any Participants by the
open of business on the business day after which this Agreement is executed will
be offered to the public by Xxxxxxx Xxxxx Barney Inc. as set forth in the
Prospectus.
1. Representations and Warranties.
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(i) The Company represents and warrants to, and agrees with, each
Underwriter as set forth below in this Section 1(i).
(a) The Company has prepared and filed with the Commission a
registration statement (file number 333-88878) on Form S-1, including a related
preliminary prospectus, for registration under the Act of the offering and sale
of the Securities. The Company may have filed one or more amendments thereto,
including a related preliminary prospectus, each of which has previously been
furnished to you. The Company will next file with the Commission either (1)
prior to the Effective Date of such registration statement, a further amendment
to such registration statement (including the form of final prospectus) or (2)
after the Effective Date of such registration statement, a final prospectus in
accordance with Rules 430A and 424(b). In the case of clause (2), the Company
has included in such registration statement, as amended at the Effective Date,
all information (other than Rule 430A Information) required by the Act and the
rules thereunder to be included in such registration statement and the
Prospectus. As filed,
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such amendment and form of final prospectus, or such final prospectus, shall
contain all Rule 430A Information, together with all other such required
information, and, except to the extent the Representatives shall agree in
writing to a modification, shall be in all substantive respects in the form
furnished to you prior to the Execution Time or, to the extent not completed at
the Execution Time, shall contain only such specific additional information and
other changes (beyond that contained in the latest Preliminary Prospectus) as
the Company has advised you, prior to the Execution Time, will be included or
made therein.
(b) On the Effective Date, the Registration Statement did or will, and when
the Prospectus is first filed (if required) in accordance with Rule 424(b) and
on the Closing Date (as defined in Section 3 below) and on any date on which
Option Securities are purchased, if such date is not the Closing Date (a
"settlement date"), the Prospectus (and any supplements thereto) will, comply in
all material respects with the applicable requirements of the Act and the rules
thereunder; on the Effective Date and at the Execution Time, the Registration
Statement did not or will not contain any untrue statement of a material fact or
omit to state any material fact required to be stated therein or necessary in
order to make the statements therein not misleading; and, on the Effective Date,
the Prospectus, if not filed pursuant to Rule 424(b), will not, and on the date
of any filing pursuant to Rule 424(b) and on the Closing Date and any settlement
date, the Prospectus (together with any supplement thereto) will not, include
any untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided, however,
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that the Company makes no representations or warranties as to the information
contained in or omitted from the Registration Statement or the Prospectus (or
any supplement thereto) in reliance upon and in conformity with information
furnished in writing to the Company by or on behalf of any Underwriter through
the Representatives specifically for inclusion in the Registration Statement or
the Prospectus (or any supplement thereto).
(c) Each of the Company and its Subsidiaries has been duly incorporated and
is validly existing as a corporation (or if not a corporation, has been duly
formed and is validly existing) under the laws of the jurisdiction in which it
is chartered or organized and, with respect to the Company and any such
Subsidiary incorporated in the United States, is a corporation in good standing
under such laws and, in all cases, has corporate power and authority to own or
lease, as the case may be, and to operate its properties and conduct its
business as described in the Prospectus, and is duly qualified to do business as
a foreign corporation and is in good standing under the laws of each
jurisdiction which requires such qualification, except where the failure to so
qualify or be in good standing would not have a Material Adverse Effect.
(d) All the outstanding shares of capital stock of each Subsidiary have
been duly and validly authorized and issued and are fully paid and
nonassessable, and, except as otherwise set forth in the Prospectus and assuming
consummation of the transactions described in the Prospectus, all outstanding
shares of capital stock of the Subsidiaries are owned by the Company either
directly or through wholly owned subsidiaries free and clear of any perfected
security interest or any other security interests, claims, liens or
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encumbrances, except for any such perfected security interests or other security
interests, claims, liens or encumbrances that would not have a Material Adverse
Effect, except as set forth in the Prospectus and except for the lien on the
capital stock of the Subsidiaries under the Amended and Restated Credit
Agreement, dated February 4, 2002, among the Selling Securityholder, the
subsidiary borrowers referred to therein, the lenders referred to therein and
JPMorgan Chase Bank, as administrative agent (the "Crown Credit Agreement"),
which lien will be released with respect to the capital stock of the
Subsidiaries on the Closing Date.
(e) The Company's authorized equity capitalization is as set forth in the
Prospectus; the capital stock of the Company conforms in all material respects
to the description thereof contained in the Prospectus; the outstanding shares
of Common Stock (including the Underwritten Securities being sold hereunder by
the Selling Securityholder) have been duly and validly authorized and issued,
are fully paid and nonassessable and, except as set forth in the Prospectus, are
free of any preemptive or other rights to subscribe for the Securities; the
Underwitten Securities being sold by the Selling Securityholder are, and the
Option Securities to be sold by the Selling Securityholder if the Underwriters
execute their over-allotment option will be, duly listed, admitted and
authorized for quotation on the Nasdaq National Market (the "Nasdaq"); the
certificates for the Securities comply with the requirements of the General
Corporation Law of the State of Delaware and the requirements of the Nasdaq;
and, except as set forth in the Prospectus, no options, warrants or other rights
to purchase, agreements or other obligations to issue, or rights to convert any
obligations into or exchange any securities for, shares of capital stock of or
ownership interests in the Company are outstanding.
(f) There is no franchise, contract or other document of a character
required to be described in the Registration Statement or Prospectus, or to be
filed as an exhibit thereto, which is not described or filed as required; and
the statements in the Prospectus under the headings "Material United States Tax
Consequences to Non-U.S. Holders of Common Stock," "Our Business--Intellectual
Property" and "Our Business--Legal Matters" fairly summarize the matters therein
described.
(g) This Agreement has been duly authorized, executed and delivered by the
Company and constitutes a valid and binding obligation of the Company
enforceable in accordance with its terms.
(h) The Company is not and, after giving effect to the offering and sale of
the Securities and the application of the proceeds thereof as described in the
Prospectus, will not be an "investment company" as defined in the Investment
Company Act of 1940, as amended.
(i) No consent, approval, authorization, filing with or order of any court
or governmental agency or body is required for the consummation by the Company
of the transactions contemplated herein, except such as have been obtained under
the Act and such as may be required under the blue sky laws of any jurisdiction
in connection with the purchase and distribution of the Securities by the
Underwriters in the manner contemplated herein and in the Prospectus, and except
where the failure to obtain such consent, approval, authorization, filing or
order would not have a material adverse effect
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on the sale of the Securities or the consummation of any of the other
transactions contemplated herein.
(j) Neither the sale of the Securities by the Selling Securityholder, nor
the consummation of any other of the transactions contemplated herein nor the
fulfillment of the terms hereof will conflict with, result in a breach or
violation or imposition of any lien, charge or encumbrance upon any property or
assets of the Company or any Subsidiary pursuant to (i) the charter, by-laws or
other similar organizational document of the Company or any of its Subsidiaries,
(ii) the terms of any indenture, contract, lease, mortgage, deed of trust, note
agreement, loan agreement or other agreement, obligation, condition, covenant or
instrument to which the Company or any Subsidiaries is a party or bound or to
which its or their property is subject or (iii) any statute, law, rule,
regulation, judgment, order or decree applicable to the Company or any of its
Subsidiaries of any court, regulatory body, administrative agency, governmental
body, arbitrator or other authority having jurisdiction over the Company or any
Subsidiaries or any of its or their properties, except, in the case of clauses
(ii) and (iii) above, for such conflict, breach, violation or imposition that
would not have a material adverse effect on the sale of the Securities by the
Selling Securityholder or the consummation of any of the other transactions
contemplated herein.
(k) Before giving effect to the offering and sale of the Securities, the
Selling Securityholder owns all of the outstanding stock of the Company.
(l) The combined historical financial statements of the Company and its
consolidated subsidiaries included in the Prospectus and the Registration
Statement present fairly in all material respects the financial condition,
results of operations and cash flows of the Company as of the dates and for the
periods indicated, comply as to form with the applicable accounting requirements
of the Act and have been prepared in conformity with generally accepted
accounting principles applied on a consistent basis throughout the periods
involved (except as otherwise noted therein). The selected financial data set
forth under the caption "Selected Financial Data" in the Prospectus and
Registration Statement fairly present, on the basis stated in the Prospectus and
the Registration Statement, the information included therein. The pro forma
financial statements included in the Prospectus and the Registration Statement
include assumptions that provide a reasonable basis for presenting the
significant effects directly attributable to the transactions and events
described therein, the related pro forma adjustments give appropriate effect to
those assumptions, and the pro forma adjustments reflect the proper application
of those adjustments to the historical financial statement amounts in the pro
forma financial statements included in the Prospectus and the Registration
Statement. The pro forma financial statements included in the Prospectus and the
Registration Statement comply as to form in all material respects with the
applicable accounting requirements of Regulation S-X under the Act and the pro
forma adjustments have been properly applied to the historical amounts in the
compilation of those statements.
(m) No action, suit or proceeding by or before any court or governmental
agency, authority or body or any arbitrator involving the Company or any of its
Subsidiaries or its or their property is pending or, to the knowledge of the
Company, threatened that
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(i) could reasonably be expected to have a material adverse effect on the
performance of this Agreement or the consummation of any of the
transactions contemplated hereby or (ii) would have a Material Adverse
Effect.
(n) Each of the Company and each of the Subsidiaries owns or leases
all such properties as are necessary to the conduct of its operations as
presently conducted, except where the failure to own or lease such
properties would not have a Material Adverse Effect.
(o) Neither the Company nor any Subsidiary is in violation or default
of (i) any provision of its charter, bylaws or other similar organizational
document, (ii) the terms of any indenture, contract, lease, mortgage, deed
of trust, note agreement, loan agreement or other agreement, obligation,
condition, covenant or instrument to which it is a party or bound or to
which its property is subject, or (iii) any statute, law, rule, regulation,
judgment, order or decree of any court, regulatory body, administrative
agency, governmental body, arbitrator or other authority having
jurisdiction over the Company or such Subsidiary or any of its properties,
as applicable, except, in the case of clause (ii) or (iii), for any such
violation or default that would not have a Material Adverse Effect.
(p) PricewaterhouseCoopers LLP, who have certified certain financial
statements of the Company and its consolidated subsidiaries and delivered
their report with respect to the audited combined financial statements
included in the Prospectus, are independent public accountants with respect
to the Company within the meaning of the Act and the applicable published
rules and regulations thereunder.
(q) There are no non-rebatable transfer taxes or other similar fees or
charges under federal law or the laws of any state, or any political
subdivision thereof, required to be paid by the Company or any Subsidiary
in connection with the execution and delivery of this Agreement.
(r) The Company and each of its Subsidiaries has filed all foreign,
federal, state and local tax returns that are required to be filed or has
requested extensions thereof (except in any case in which the failure so to
file would not have a Material Adverse Effect) and has paid all taxes
required to be paid by it and any other assessment, fine or penalty levied
against it, to the extent that any of the foregoing is due and payable,
except for any such assessment, fine or penalty that is currently being
contested in good faith or as would not have a Material Adverse Effect.
(s) No labor problem or dispute with the employees of the Company or
any of its Subsidiaries exists or, to the Company's knowledge, is
threatened or imminent, and the Company is not aware of any existing or
imminent labor disturbance by the employees of any of its or its
Subsidiaries' principal suppliers, contractors or customers, that could
have a Material Adverse Effect.
(t) The Company and each Subsidiary are insured by insurers of
recognized financial responsibility against such losses and risks and in
such amounts as are prudent and customary in the businesses in which they
are engaged; all policies of insurance and
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fidelity or surety bonds insuring the Company or any Subsidiary or their
respective businesses, assets, employees, officers and directors are in
full force and effect; the Company and the Subsidiaries are in
compliance with the terms of such policies and instruments in all material
respects; and there are no claims by the Company or any Subsidiary under
any such policy or instrument as to which any insurance company is denying
liability or defending under a reservation of rights clause; neither the
Company nor any Subsidiary has been refused any insurance coverage sought
or applied for; and neither the Company nor any Subsidiary has any reason
to believe that it will not be able to renew its existing insurance
coverage as and when such coverage expires or to obtain similar coverage
from similar insurers as may be necessary to continue its business at a
cost that would not have a Material Adverse Effect.
(u) Assuming consummation of the transactions described in the
Prospectus, no Subsidiary is currently prohibited, directly or indirectly,
from paying any dividends to the Company, from making any other
distribution on such Subsidiary's capital stock, from repaying to the
Company any loans or advances to such Subsidiary from the Company or from
transferring any of such Subsidiary's property or assets to the Company or
any other Subsidiary, except as described in or contemplated by the
Prospectus.
(v) The Company and each of the Subsidiaries possess all licenses,
certificates, permits and other authorizations issued by the appropriate
federal, state or foreign regulatory authorities necessary to conduct their
respective businesses, except where the failure to possess such licenses,
certificates, permits or other authorizations would not have a Material
Adverse Effect, and neither the Company nor any such Subsidiary has
received any notice of proceedings relating to the revocation or
modification of any such certificate, authorization or permit which, singly
or in the aggregate, if the subject of an unfavorable decision, ruling or
finding, would have a Material Adverse Effect.
(w) The Company and each Subsidiary maintain a system of internal
accounting controls sufficient to provide reasonable assurance that (i)
transactions are executed in accordance with management's general or
specific authorizations; (ii) transactions are recorded as necessary to
permit preparation of financial statements in conformity with generally
accepted accounting principles and to maintain asset accountability; (iii)
access to assets is permitted only in accordance with management's general
or specific authorization; and (iv) the recorded accountability for assets
is compared with the existing assets at reasonable intervals and
appropriate action is taken with respect to any differences.
(x) The Company has not taken, directly or indirectly, any action that
has constituted or that was designed to, or might reasonably be expected to
cause or result in, under the Exchange Act or otherwise, stabilization or
manipulation of the price of any security of the Company to facilitate the
sale or resale of the Securities.
(y) Except as set forth in the Prospectus, the Company and the
Subsidiaries are (i) in compliance with any and all applicable foreign,
federal, state and local laws and regulations relating to the protection of
human health and safety, the environment or hazardous or toxic substances
or wastes, pollutants or contaminants ("Environmental
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Laws"), (ii) have received and are in compliance with all permits, licenses
or other approvals required of them under applicable Environmental Laws to
conduct their respective businesses and (iii) have not received notice of
any actual or potential liability for the investigation or remediation of
any disposal or release of hazardous or toxic substances or wastes,
pollutants or contaminants, except where such non-compliance with
Environmental Laws, failure to receive or comply with required permits,
licenses or other approvals, or liability would not, individually or in the
aggregate, have a Material Adverse Effect. Except as set forth in the
Prospectus, neither the Company nor any of the Subsidiaries has been named
as a "potentially responsible party" under the Comprehensive Environmental
Response, Compensation, and Liability Act of 1980, as amended.
(z) In the ordinary course of its business, the Company periodically
reviews the effect of Environmental Laws on the business, operations and
properties of the Company and the Subsidiaries, in the course of which it
seeks to identify and evaluate associated material costs and liabilities
(including, without limitation, any material capital or operating
expenditures required for clean-up, closure of properties or compliance
with Environmental Laws, or any permit, license or approval, any related
constraints on operating activities and any potential liabilities to third
parties). On the basis of such review, the Company has reasonably concluded
that such associated costs and liabilities would not, singly or in the
aggregate, have a Material Adverse Effect.
(aa) Each of the Company and the Subsidiaries has fulfilled its
obligations, if any, under the minimum funding standards of Xxxxxxx 000 xx
xxx Xxxxxx Xxxxxx Employee Retirement Income Security Act of 1974 ("ERISA")
and the regulations and published interpretations thereunder with respect
to each "plan" (as defined in Section 3(3) of ERISA and such regulations
and published interpretations) in which employees of the Company and the
Subsidiaries are eligible to participate and each such plan is in
compliance in all material respects with the presently applicable
provisions of ERISA and such regulations and published interpretations. The
Company and the Subsidiaries have not incurred any unpaid liability to the
Pension Benefit Guaranty Corporation (other than for the payment of
premiums in the ordinary course) or to any such plan under Title IV of
ERISA.
(bb) As of the Closing Date, the subsidiaries listed on Annex A
attached hereto will be the only significant subsidiaries of the Company as
defined by Rule 1-02 of Regulation S-X (the "Subsidiaries").
(cc) The Company or the Subsidiaries on the Closing Date will own,
possess, license or have other rights to use, all patents, patent
applications, trade and service marks, trade and service xxxx
registrations, trade names, copyrights, inventions, trade secrets,
technology, know-how and other intellectual property (collectively, the
"Intellectual Property") necessary for the conduct of their respective
businesses as now conducted or as proposed in the Prospectus to be
conducted, except where the failure to own, possess, license or have other
such rights would not have a Material Adverse Effect. Except as set forth
in the Prospectus, (i) there are no rights of third parties to any such
Intellectual Property, except for commercial shrink-wrap software; (ii) to
the knowledge
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of the Company, there is no material infringement by third parties of any
such Intellectual Property; (iii) there is no pending or, to the
knowledge of the Company, threatened action, suit, proceeding or claim by
any third party challenging the Company's or the Subsidiaries' rights in or
to any such Intellectual Property that would have a Material Adverse
Effect, and the Company is unaware of any facts which would form a
reasonable basis for any such claim; (iv) there is no pending or, to the
knowledge of the Company, threatened action suit, proceeding or claim by
any third party challenging the validity or scope of any such Intellectual
Property that would have a Material Adverse Effect, and the Company is
unaware of any facts which would form a reasonable basis for any such
claim; (v) there is no pending or, to the knowledge of the Company,
threatened action, suit, proceeding or claim by any third party that the
Company or any Subsidiary infringes or otherwise violates any patent,
trademark, copyright, trade secret or other proprietary rights of others
that would have a Material Adverse Effect, and the Company is unaware of
any other fact which would form a reasonable basis for any such claim; (vi)
to the knowledge of the Company, there is no valid and subsisting U.S.
patent or published U.S. patent application that would preclude the Company
from practicing any material Intellectual Property that is owned by or
licensed to the Company or any Subsidiary; and (vii) to the knowledge of
the Company, all material patents owned by the Company or the Subsidiaries
are valid and enforceable.
(dd) The statements contained in the Prospectus under the captions
"Risk Factors - We Enjoy Only Limited Protection for Our Intellectual
Property," "Risk Factors - If We Lose An Existing Lawsuit Regarding Oxbar,
We May Lose A Potential Source of Revenue," and "Business - Intellectual
Property," insofar as such statements summarize legal matters, agreements,
documents, or proceedings discussed therein, are accurate and fair
summaries of such legal matters, agreements, documents or proceedings.
(ee) The Company has not offered, or caused the Underwriters to offer,
Securities to any person pursuant to the Directed Share Program with the
specific intent to unlawfully influence (i) a customer or supplier of the
Company to alter the customer's or supplier's level or type of business
with the Company, or (ii) a trade journalist or publication to write or
publish favorable information about the Company or its products.
Any certificate signed by any officer of the Company and delivered to the
Representatives or counsel for the Underwriters in connection with the offering
of the Securities shall be deemed a representation and warranty by the Company,
as to matters covered thereby, to each Underwriter.
Furthermore, the Company represents and warrants to Xxxxxxx Xxxxx Barney Inc.
that (i) the Registration Statement, the Prospectus and any preliminary
prospectus comply, and any further amendments or supplements thereto will
comply, with any applicable laws or regulations of the United Kingdom, the only
foreign jurisdiction in which the Company has directed Xxxxxxx Xxxxx Xxxxxx Inc.
to distribute the Prospectus or any preliminary prospectus, as amended or
supplemented if applicable, and to sell the Securities in connection with the
Directed Share Program, and that (ii) no authorization, approval, consent,
license, order, registration or qualification of or with any government,
governmental instrumentality or court, other than such
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as have been obtained, is necessary under the securities laws and regulations of
foreign jurisdictions in which the Directed Shares are offered outside the
United States.
(ii) The Selling Securityholder represents and warrants to, and agrees
with, each Underwriter that:
(a) The Selling Securityholder is the record and beneficial owner of
the Securities to be sold by the Selling Securityholder hereunder free and
clear of all liens, encumbrances, equities and claims, except for the lien
on the Common Stock under the Crown Credit Agreement, which lien will be
released with respect to the Common Stock on the Closing Date, and has duly
endorsed such Securities in blank, and, assuming that each Underwriter
acquires its interest in the Securities it has purchased from the Selling
Securityholder without notice of any adverse claim (within the meaning of
Section 8-105 of the New York Uniform Commercial Code (the "UCC")), each
Underwriter that has purchased such Underwritten Securities delivered on
the Closing Date to The Depository Trust Company or other securities
intermediary by making payment therefor as provided herein, and that has
had such Securities credited by book entry to the securities account or
accounts of such Underwriter maintained with The Depository Trust Company
or such other securities intermediary, will have acquired a security
entitlement (within the meaning of Section 8-102(a)(17) of the UCC) to such
Underwritten Securities purchased by such Underwriter, and no action based
on an adverse claim (within the meaning of Section 8-105 of the UCC) may be
successfully asserted against such Underwriter with respect to such
Securities.
(b) The Selling Securityholder has been duly incorporated and is
validly existing as a corporation under the laws of the jurisdiction in
which it is organized and is a corporation in good standing under the laws
of such jurisdiction and has corporate power and authority to own or lease,
as the case may be, and to operate its properties and conduct its business
as described in the Prospectus, and is duly qualified to do business as a
foreign corporation and is in good standing under the laws of each
jurisdiction which requires such qualification, except where the failure to
so qualify or be in good standing would not have a material adverse effect
on the condition (financial or otherwise), earnings, business or properties
of the Selling Securityholder whether or not arising from transactions in
the ordinary course of business, except as set forth or contemplated in the
Prospectus (exclusive of any supplement thereto).
(c) This Agreement has been duly authorized, executed and delivered by
the Selling Securityholder and constitutes a valid and binding obligation
of the Selling Securityholder enforceable in accordance with its terms.
(d) The Selling Securityholder has not taken, directly or indirectly,
any action that has constituted or that was designed to or might reasonably
be expected to cause or result in, under the Exchange Act or otherwise,
stabilization or manipulation of the price of any security of the Company
to facilitate the sale or resale of the Securities.
(e) No consent, approval, authorization or order of any court or
governmental agency or body is required for the consummation by the Selling
Securityholder of the
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transactions contemplated herein, except such as may have been
obtained under the Act and such as may be required under the blue sky
laws of any jurisdiction in connection with the purchase and
distribution of the Securities by the Underwriters and such other
approvals as have been obtained, and except where the failure to
obtain such consent, approval, authorization, or order would not have
a material adverse effect on the sale of the Securities or the
consummation of any of the other transactions contemplated herein.
(f) Except as set forth in the Prospectus, neither the sale of
the Securities being sold hereunder by the Selling Securityholder nor
the consummation of any other of the transactions contemplated herein
by the Selling Securityholder or the fulfillment of the terms hereof by
the Selling Securityholder will conflict with, result in a breach or
violation of, or constitute a default under (i) any law, (ii) the
charter or by-laws of the Selling Securityholder, (iii) the terms of
any indenture or other agreement or instrument to which the Selling
Securityholder or any of its subsidiaries is a party or bound, or (iv)
any judgment, order or decree applicable to the Selling Securityholder
or any of its subsidiaries of any court, regulatory body,
administrative agency, governmental body or arbitrator having
jurisdiction over the Selling Securityholder or any of its
subsidiaries, except, in the case of clauses (i), (iii) and (iv), for
such conflict, breach, violation or default that would not have a
material adverse effect on the sale of the Securities or the
consummation of any of the other transactions contemplated herein.
(g) The Selling Securityholder has no reason to believe that
the representations and warranties of the Company contained in this
Section 1 are not true and correct, is familiar with the Registration
Statement and has no knowledge of any material fact, condition or
information not disclosed in the Prospectus or any supplement thereto
which has adversely affected or may adversely affect the business of
the Company or any of its subsidiaries; and the sale of Securities by
the Selling Securityholder pursuant hereto is not prompted by any
information concerning the Company or any of its subsidiaries which is
not set forth in the Prospectus or any supplement thereto.
(h) In respect of any statements in or omissions from the
Registration Statement or the Prospectus or any supplements thereto
made in reliance upon and in conformity with information regarding the
Selling Securityholder furnished in writing to the Company by the
Selling Securityholder specifically for use in connection with the
preparation thereof, the Selling Securityholder hereby makes the same
representations and warranties to each Underwriter as the Company makes
to such Underwriter under paragraph (i)(b) of this Section.
(i) The Selling Securityholder has not offered, or caused the
Underwriters to offer, Securities to any person pursuant to the
Directed Share Program with the specific intent to unlawfully influence
(i) a customer or supplier of the Company to alter the customer's or
supplier's level or type of business with the Company, or (ii) a trade
journalist or publication to write or publish favorable information
about the Company or its products.
Any certificate signed by any officer of the Selling Securityholder and
delivered to the Representatives or counsel for the Underwriters in connection
with the offering of the Securities
11
shall be deemed a representation and warranty by the Selling Securityholder, as
to matters covered thereby, to each Underwriter.
2. Purchase and Sale. (a) Subject to the terms and conditions and in
reliance upon the representations and warranties set forth herein, the Selling
Securityholder agrees to sell to each Underwriter, and each Underwriter agrees,
severally and not jointly, to purchase from the Selling Securityholder (i) at a
purchase price of $11.16 per share, the number of shares of the Underwritten
Securities (exclusive of the Incremental Shares) set forth opposite such
Underwriter's name in Schedule I hereto and (ii) at a purchase price per share
equal to the public offer price set forth on the cover of the Prospectus, the
number of shares of the Incremental Shares set forth opposite such Underwriter's
name in Schedule I hereto.
(b) Subject to the terms and conditions and in reliance upon the
representations and warranties set forth herein, the Selling Securityholder
hereby grants an option to the several Underwriters to purchase, severally and
not jointly, up to 1,500,000 Option Securities at the same purchase price per
share as the Underwriters shall pay for the Underwritten Securities (exclusive
of the Incremental Shares). Said option may be exercised only to cover
over-allotments in the sale of the Underwritten Securities (exclusive of the
Incremental Shares) by the Underwriters. Said option may be exercised in whole
or in part at any time on or before the 30th day after the date of the
Prospectus upon written or telegraphic notice by the Representatives to the
Company setting forth the number of shares of the Option Securities as to which
the several Underwriters are exercising the option and the settlement date. The
number of shares of Option Securities to be purchased by each Underwriter shall
be the same percentage of the total number of shares of the Option Securities to
be purchased by the several Underwriters as such Underwriter is purchasing of
the Underwritten Securities, subject to such adjustments as you in your absolute
discretion shall make to eliminate any fractional shares.
(c) Subject to the terms and conditions set forth herein, the Selling
Securityholder agrees to purchase from the Underwriters, severally and not
jointly, 1,500,000 shares of Common Stock at a price per share equal to the
public offer price set forth on the cover of the Prospectus. The number of
shares to be purchased from each Underwriter, pursuant to this paragraph (c)
shall be equal to the number of shares of Incremental Shares committed to be
purchased by such Underwriter under this Agreement.
3. Delivery and Payment. Delivery by the Selling Securityholder of and
payment by the Underwriters for the Underwritten Securities and the Incremental
Shares shall be made at 10:00 AM, New York City time, on November 20, 2002, or
at such time on such later date not more than three Business Days after the
foregoing date as the Representatives shall designate, which date and time may
be postponed by agreement among the Representatives, the Company and the Selling
Securityholder or as provided in Section 9 hereof (such date and time of
delivery and payment for the Underwritten Securities and the Incremental Shares
being called herein the "Closing Date"). Delivery of the Underwritten Securities
and the Incremental Shares shall be made to the Representatives for the
respective accounts of the several Underwriters against payment by the several
Underwriters through the Representatives of the purchase price of the
Underwritten Securities and the Incremental Shares to or upon the order of the
Selling Securityholder by wire transfer payable in same-day funds to the account
specified by the Selling Securityholder. Delivery of the Underwritten Securities
and the Incremental Shares shall be made through the facilities of The
Depository Trust Company unless the Representatives shall otherwise instruct.
Delivery by the Underwriters and payment by the Selling Securityholder for the
purchase of the Incremental Shares by the Selling Securityholder from the
Underwriters shall be made immediately following the sale of the Underwritten
Securities and the Incremental Shares referenced above. Delivery of the
Incremental Shares shall be made to the Selling Securityholder against payment
by the Selling Securityholder of the purchase price of the Incremental Shares to
or upon the order of the Underwriters by wire transfer payable in same-day funds
to the account specified by the Underwriters. Delivery of the Incremental Shares
shall be made through the facilities of The Depository Trust Company unless the
Selling Securityholder shall otherwise instruct.
If the option provided for in Section 2(b) hereof shall have been exercised on
or before the third Business Day prior to the Closing Date, delivery by the
Selling Securityholder and payment by the Underwriters for the Option Securities
shall be made immediately following the repurchase of the Incremental Shares
referenced above. Delivery of the Option Securities shall be made to the
Representatives for the respective accounts of the several Underwriters against
payment by the several Underwriters through the Representatives of the purchase
price of the Option Securities to or upon the order of the Selling
Securityholder by wire transfer payable in same-day funds to the account
specified by the Selling Securityholder. Delivery of the Option Securities shall
be made through the facilities of The Depository Trust Company unless the
Representatives shall otherwise instruct.
12
The Selling Securityholder will pay all applicable state transfer taxes, if
any, involved in the transfer to the several Underwriters of the Underwritten
Securities to be purchased by them from the Selling Securityholder and the
respective Underwriters will pay any additional stock transfer taxes involved in
further transfers.
If the option provided for in Section 2(b) hereof is exercised after the
third Business Day prior to the Closing Date, the Selling Securityholder will
deliver the Option Securities (at the expense of the Selling Securityholder) to
the Representatives, at 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx, xx the date
specified by the Representatives (which shall be within three Business Days
after exercise of said option) for the respective accounts of the several
Underwriters, against payment by the several Underwriters through the
Representatives of the purchase price thereof to or upon the order of the
Selling Securityholder by wire transfer payable in same-day funds to the account
specified by the Selling Securityholder. If settlement for the Option Securities
occurs after the Closing Date, the Selling Securityholder will deliver to the
Representatives on the settlement date for the Option Securities, and the
obligation of the Underwriters to purchase the Option Securities shall be
conditioned upon receipt of, supplemental opinions, certificates and letters
confirming as of such date the opinions, certificates and letters delivered on
the Closing Date pursuant to Section 6 hereof.
4. Offering by Underwriters. It is understood that the several Underwriters
propose to offer the Securities (other than the Incremental Shares) for sale to
the public and the Incremental Shares for sale to the Selling Securityholder,
all as set forth in the Prospectus.
5. Agreements.
(i) The Company agrees with the several Underwriters that:
(a) The Company will use its best efforts to cause the Registration
Statement, if not effective at the Execution Time, and any amendment thereof, to
become effective. Prior to the termination of the offering of the Securities,
the Company will not file any amendment of the Registration Statement or
supplement to the Prospectus or any Rule 462(b) Registration Statement unless
the Company has furnished you a copy for your review prior to filing and will
not file any such proposed amendment or supplement to which you reasonably
object. Subject to the foregoing sentence, if the Registration Statement has
become or becomes effective pursuant to Rule 430A, or filing of the Prospectus
is otherwise required under Rule 424(b), the Company will cause the Prospectus,
properly completed, and any supplement thereto to be filed with the Commission
pursuant to the applicable paragraph of Rule 424(b) within the time period
prescribed and will provide evidence satisfactory to the Representatives of such
timely filing. The Company will promptly advise the Representatives (1) when the
Registration
13
Statement, if not effective at the Execution Time, shall have become effective,
(2) when the Prospectus, and any supplement thereto, shall have been filed (if
required) with the Commission pursuant to Rule 424(b) or when any Rule 462(b)
Registration Statement shall have been filed with the Commission, (3) when,
prior to termination of the offering of the Securities, any amendment to the
Registration Statement shall have been filed or become effective, (4) of any
request by the Commission or its staff for any amendment of the Registration
Statement, or any Rule 462(b) Registration Statement, or for any supplement to
the Prospectus or for any additional information, (5) of the issuance by the
Commission of any stop order suspending the effectiveness of the Registration
Statement or the institution or threatening of any proceeding for that purpose
and (6) of the receipt by the Company of any notification with respect to the
suspension of the qualification of the Securities for sale in any jurisdiction
or the institution or threatening of any proceeding for such purpose. The
Company will use its best efforts to prevent the issuance of any such stop order
or the suspension of any such qualification and, if issued, to obtain as soon as
possible the withdrawal thereof.
(b) If, at any time when a prospectus relating to the Securities is\
required to be delivered under the Act, any event occurs as a result of which
the Prospectus as then supplemented would include any untrue statement of a
material fact or omit to state any material fact necessary to make the
statements therein in the light of the circumstances under which they were made
not misleading, or if it shall be necessary to amend the Registration Statement
or supplement the Prospectus to comply with the Act or the rules thereunder, the
Company promptly will (1) notify the Representatives of any such event, (2)
prepare and file with the Commission, subject to the second sentence of
paragraph (i)(a) of this Section 5, an amendment or supplement which will
correct such statement or omission or effect such compliance and (3) supply any
supplemented Prospectus to you in such quantities as you may reasonably request.
(c) Through the timely filing of periodic reports under the Exchange
Act, the Company will make generally available to its security holders and to
the Representatives an earnings statement or statements of the Company and its
Subsidiaries which will satisfy the provisions of Section 11(a) of the Act and
Rule 158 under the Act.
(d) The Company will furnish to the Representatives and counsel for
the Underwriters signed copies of the Registration Statement (including exhibits
thereto) and to each other Underwriter a copy of the Registration Statement
(without exhibits thereto) and, so long as delivery of a prospectus by an
Underwriter or dealer may be required by the Act, as many copies of each
Preliminary Prospectus and the Prospectus and any supplement thereto as the
Representatives may reasonably request.
(e) The Company will arrange, if necessary, for the qualification of
the Securities for sale under the laws of such jurisdictions as the
Representatives may designate and will maintain such qualifications in effect so
long as required for the distribution of the Securities and will pay any fee of
the National Association of Securities Dealers, Inc., in connection with its
review of the offering; provided that in no event shall the Company be obligated
to qualify to do business in any jurisdiction where it is not now so qualified
or to execute a general consent to service of process in any jurisdiction in
which such a
14
consent has not been previously filed or to subject itself to taxation in any
jurisdiction wherein it would not otherwise be subject to tax but for the
requirements of this paragraph.
(f) The Company will not, without the prior written consent of Xxxxxxx
Xxxxx Xxxxxx Inc. and Deutsche Bank Securities Inc., offer, sell, contract to
sell, pledge, or otherwise dispose of (or enter into any transaction which is
designed to, or might reasonably be expected to, result in the disposition
(whether by actual disposition or effective economic disposition due to cash
settlement or otherwise) by the Company or any affiliate of the Company or any
person with whom the Company or any affiliate of the Company has an agreement
with respect to securities of the Company), directly or indirectly, including
the filing (or participation in the filing) of a registration statement with the
Commission in respect of, or establish or increase a put equivalent position or
liquidate or decrease a call equivalent position within the meaning of Section
16 of the Exchange Act with respect to, any shares of Common Stock or any
securities convertible into, or exercisable or exchangeable for, shares of
Common Stock, or publicly announce an intention to effect any such transaction,
for a period of 180 days after the date of this Agreement, provided, however,
-------- -------
that (1) the Company may issue, sell and register Common Stock pursuant to any
employee stock option plan, stock ownership plan or dividendreinvestment plan of
the Company in effect at the Execution Time, (2) the Company may issue Common
Stock issuable upon the conversion of securities or theexercise of warrants
outstanding at the Execution Time, and (3) the Company may issue Common Stock in
connection with any merger, consolidation or stock or asset acquisition, so long
as the recipients of the Common Stock in such transaction agree to be bound by
the same lock-up restrictions as the Company.
(g) The Company will not take, directly or indirectly, any action that
constitutes or that is designed to or might reasonably be expected to cause or
result in, under the Exchange Act or otherwise, stabilization or manipulation of
the price of any security of the Company to facilitate the sale or resale of the
Securities.
(h) In connection with the Directed Share Program, the Company will ensure
that the Directed Shares will be restricted to the extent required by the
National Association of Securities Dealers, Inc. (the "NASD") or the NASD rules
from sale, transfer, assignment, pledge or hypothecation for a period of three
months following the date of the effectiveness of the Registration Statement.
Xxxxxxx Xxxxx Barney Inc. will notify the Company as to which Participants will
need to be so restricted. The Company will direct the removal of such transfer
restrictions upon the expiration of such period of time.
(i) The Company will pay all reasonable fees and disbursements of counsel
incurred by the Underwriters in connection with the Directed Share Program
(including the printing (or reproduction) and delivery (including postage, air
freight charges and charges for counting and packaging) of such copies of the
Directed Share Program materials) and stamp duties, similar taxes or duties or
other taxes, if any, incurred by the Underwriters in connection with the
Directed Share Program.
15
Furthermore, the Company covenants with Xxxxxxx Xxxxx Xxxxxx Inc. that the
Company will comply with all applicable securities and other applicable laws,
rules and regulations in each foreign jurisdiction in which the Directed Shares
are offered in connection with the Directed Share Program.
(ii) The Selling Securityholder agrees with the several Underwriters that:
(a) The Selling Securityholder will not, without the prior written
consent of Xxxxxxx Xxxxx Barney Inc. and Deutsche Bank Securities Inc.,
offer, sell, contract to sell, pledge or otherwise dispose of (or enter
into any transaction which is designed to, or might reasonably be expected
to, result in the disposition (whether by actual disposition or effective
economic disposition due to cash settlement or otherwise) by the Selling
Securityholder or any affiliate of the Selling Securityholder or any person
with whom the Selling Securityholder or any affiliate of the Selling
Securityholder has an agreement with respect to securities of the Company),
directly or indirectly, or file (or participate in the filing of) a
registration statement with the Commission in respect of, or establish or
increase a put equivalent position or liquidate or decrease a call
equivalent position within the meaning of Section 16 of the Exchange Act
with respect to, any shares of capital stock of the Company (other than the
Securities) or any securities convertible into, or exercisable or
exchangeable for, such capital stock, or publicly announce an intention to
effect any such transaction, for a period of 180 days after the date of
this Agreement, other than any shares of Common Stock disposed of as bona
fide gifts approved by Xxxxxxx Xxxxx Xxxxxx Inc., any shares of Common
Stock pledged to Crown's creditors or sold upon foreclosure by Crown's
creditors or in connection with an acquisition of a majority of the voting
power of Constar by a third party not affiliated with Crown or Constar.
(b) The Selling Securityholder will not take, directly or indirectly,
any action that constitutes or that is designed to or might reasonably be
expected to cause or result in, under the Exchange Act or otherwise,
stabilization or manipulation of the price of any security of the Company
to facilitate the sale or resale of the Securities.
(c) The Selling Securityholder will advise the Representatives
promptly, and if requested by the Representatives, will confirm such advice
in writing, (1) until the Closing Date, of any material change in the
Company's condition (financial or otherwise), earnings, business or
properties or any new material information relating to the Company or
relating to any matter stated in the Prospectus which comes to the
attention of the Selling Securityholder and (2) so long as delivery of a
prospectus relating to the Securities by an underwriter or dealer may be
required under the Act, of any change in information in the Registration
Statement or the Prospectus relating to the Selling Securityholder.
(d) The Selling Securityholder agrees to pay the costs and expenses
relating to the following matters: (1) the preparation, printing or
reproduction and filing with the Commission of the Registration Statement
(including financial statements and exhibits thereto), each Preliminary
Prospectus, the Prospectus and each amendment or supplement to any of them;
(2) the printing (or reproduction) and delivery (including postage, air
freight charges and charges for counting and packaging) of such copies of
the Registration Statement, each Preliminary Prospectus, the Prospectus and
all amendments
16
or supplements to any of them, as may, in each case, be reasonably requested for
use in connection with the offering and sale of the Securities; (3) the delivery
of certificates for the Securities, including any stamp or transfer taxes in
connection with the sale of the Securities; (4) the printing (or reproduction)
and delivery of this Agreement, any blue sky memorandum and all other agreements
or documents printed (or reproduced) and delivered in connection with the
offering of the Securities; (5) the registration of the Securities under the
Exchange Act; (6) any registration or qualification of the Securities for offer
and sale under the securities or blue sky laws of the several states (including
filing fees and the reasonable fees and expenses of counsel for the Underwriters
relating to such registration and qualification); (7) any filings required to be
made with the National Association of Securities Dealers, Inc. (including filing
fees and the reasonable fees and expenses of counsel for the Underwriters
relating to such filings); (8) the transportation and other expenses incurred by
or on behalf of Company representatives in connection with presentations to
prospective purchasers of the Securities; (9) the fees and expenses of the
Company's and the Selling Securityholder's accountants and the fees and expenses
of counsel (including local and special counsel) for the Company and the Selling
Securityholder; and (10) all other costs and expenses incident to the
performance by the Company and the Selling Securityholder of their obligations
hereunder.
(iii) Each Underwriter severally represents and agrees that:
(a) it has not offered or sold and, prior to the expiry of six months from
the Closing Date, will not offer or sell any Securities to persons in the United
Kingdom except to persons whose ordinary activities involve them in acquiring,
holding, managing or disposing of investments (as principal or agent) for the
purposes of their businesses or otherwise in circumstances which have not
resulted and will not result in an offer to the public in the United Kingdom
within the meaning of the Public Offers of Securities Regulations 1995;
(b) it has only communicated and caused to be communicated and will only
communicate or cause to be communicated any invitation or inducement to engage
in investment activity (within the meaning of section 21 of the Financial
Services and Markets Act 2000 ("FSMA")) received by it in connection with the
issue or sale of any Securities in circumstances in which section 21(1) of the
FSMA does not apply to the Company;
(c) it has complied and will comply with all applicable provisions of the
FSMA with respect to anything done by it in relation to the Securities in, from
or otherwise involving the United Kingdom; and
(d) the offer in The Netherlands of the Securities is exclusively limited
to persons who trade or invest in securities in the conduct of a profession or
business (which include banks, stockbrokers, insurance companies, pension funds,
other institutional investors and finance companies and treasury departments of
large enterprises).
6. Conditions to the Obligations of the Underwriters. The obligations of
-------------------------------------------------
the Underwriters to purchase the Underwritten Securities and the Option
Securities, as the case may
17
be, shall be subject to the accuracy of the representations and warranties on
the part of the Company and the Selling Securityholder contained herein as of
the Execution Time, the Closing Date and any settlement date pursuant to Section
3 hereof, to the accuracy of the statements of the Company and the Selling
Securityholder made in any certificates pursuant to the provisions hereof, to
the performance by the Company and the Selling Securityholder of their
respective obligations hereunder and to the following additional conditions:
(a) If the Registration Statement has not become effective prior to
the Execution Time, unless the Representatives agree in writing to a later
time, the Registration Statement will become effective not later than (i)
6:00 PM New York City time on the date of determination of the public
offering price, if such determination occurred at or prior to 3:00 PM New
York City time on such date or (ii) 9:30 AM on the Business Day following
the day on which the public offering price was determined, if such
determination occurred after 3:00 PM New York City time on such date; if
filing of the Prospectus, or any supplement thereto, is required pursuant
to Rule 424(b), the Prospectus, and any such supplement, will be filed in
the manner and within the time period required by Rule 424(b); and no stop
order suspending the effectiveness of the Registration Statement shall have
been issued and no proceedings for that purpose shall have been instituted
or threatened.
(b) The Company shall have requested and caused Dechert, counsel for
the Company, to have furnished to the Representatives their opinion, dated
the Closing Date and addressed to the Representatives, to the effect that:
(i) each of the Company and Constar Inc., a corporation organized
under the laws of the Commonwealth of Pennsylvania, has been duly
incorporated and is validly existing as a corporation in good standing
under the laws of the jurisdiction in which it is incorporated, with
corporate power and corporate authority to own or lease, as the case
may be, and to operate its properties and conduct its business as
described in the Prospectus, and, in the case of the Company, is duly
qualified to do business as a foreign corporation and is in good
standing under the laws of the Commonwealth of Pennsylvania;
(ii) except as otherwise set forth in the Prospectus, the
outstanding shares of capital stock of Constar, Inc. and Constar
Foreign Holdings, Inc. owned by the Company are owned either directly
or through wholly owned subsidiaries free and clear of any perfected
security interest and, to the knowledge of such counsel, any other
security interest, claim, lien or encumbrance; and to the knowledge of
such counsel, based solely upon a report as to UCC financing
statements on file against the Company, Constar Foreign Holdings,
Inc., Crown Cork & Seal Company, Inc., Crown UK Holdings Ltd. and
Crown Cork Netherlands Holding BV with the Secretary of State of the
State of New York, the Secretary of State of the Commonwealth of
Pennsylvania and the Secretary of State of the State of Delaware,
there is no security interest, claim, lien or encumbrance with respect
to the outstanding shares of capital stock of Constar International
Holland (Plastics) BV and Constar International UK Ltd.;
18
(iii) the Company's authorized equity capitalization is as set forth
in the Prospectus; the capital stock of the Company conforms in all
material respects to the description thereof contained in the Prospectus;
the Securities being sold hereunder by the Selling Securityholder have been
duly and validly authorized and issued, are fully paid and nonassessable;
the Securities being sold by the Selling Securityholder on the date of the
opinion are duly listed, admitted and authorized for quotation on the
Nasdaq; the form of certificate used to evidence the Common Stock complies
with the requirements of the General Corporation Law of the State of
Delaware and the requirements of the Nasdaq National Market; except as set
forth in the Prospectus, the holders of outstanding shares of capital stock
of the Company are not entitled to preemptive or other rights to subscribe
for the Securities; except as set forth in the Prospectus, to the knowledge
of such counsel based on a review of the corporate records of the Company,
the charter and by-laws of the Company and an officers' certificate
delivered to such counsel by officials of the Company, no options, warrants
or other rights to purchase, agreements or other obligations to issue, or
rights to convert any obligations into or exchange any securities for,
shares of capital stock of or ownership interests in the Company are
outstanding;
(iv) the statements included in the Prospectus under the heading
"Material United States Tax Consequences to Non-U.S. Holders of Common
Stock," insofar as such statements constitute a summary of the legal
matters or documents referred to therein, fairly present the information
called for with respect to such legal matters or documents;
(v) the Registration Statement has become effective under the Act; any
required filing of the Prospectus, and any supplements thereto, pursuant to
Rule 424(b) has been made in the manner and within the time period required
by Rule 424(b); to the knowledge of such counsel, no stop order suspending
the effectiveness of the Registration Statement has been issued, no
proceedings for that purpose have been instituted or threatened;
(vi) this Agreement has been duly authorized, executed and delivered
by the Company;
(vii) the Company is not and, after giving effect to the offering and
sale of the Securities (including the Company's concurrent offering of its
11% Senior Subordinated Notes due 2012 and the Company's concurrent receipt
of term loans as described in the Prospectus) and the application of the
proceeds thereof as described in the Prospectus, will not be an "investment
company" as defined in the Investment Company Act of 1940, as amended;
(viii) no consent, approval, authorization, filing with or order of
any Pennsylvania, New York, Delaware or U.S. Federal court or governmental
agency or body is required for the consummation by the Company of the
transactions contemplated herein, except (1) such as have been obtained
under the Act, (2) such as may be required under the blue sky laws of any
jurisdiction in connection with the purchase and distribution of the
Securities by the Underwriters in the
19
manner contemplated in this Agreement and in the Prospectus, as to which
such counsel need express no opinion, (3) such other approvals (specified
in such opinion) as have been obtained and (4) where the failure to obtain
such consent, approval, authorization, filing or order would not have a
material adverse effect on the sale of the Securities or the consummation
of any of the other transactions contemplated herein;
(ix) neither the sale of the Securities by the Selling Securityholder
on the date of the opinion or the consummation of any other of the
transactions contemplated herein nor the fulfillment of the terms hereof
will (1) conflict with or result in a breach or violation of the charter or
by-laws of the Company or Constar Inc., (2) result in a material breach or
violation of, or the imposition of any material lien, charge or encumbrance
upon any property or assets of the Company or its Subsidiaries pursuant to
the terms of any indenture, contract, lease, mortgage, deed of trust, note
agreement, loan agreement or other agreement, obligation, condition,
covenant or instrument that is material to the Company and its
subsidiaries, taken as a whole, and that is known to such counsel after due
inquiry to which the Company or any Subsidiary is a party or bound or to
which its or their property is subject, or (3) conflict with or violate in
any material respect any Delaware corporate, Pennsylvania, New York or U.S.
Federal statute, law, rule or regulation applicable to the Company or the
Subsidiaries, or any judgment, order or decree known to such counsel after
due inquiry to be applicable to the Company or the Subsidiaries of any
court, regulatory body, administrative agency, governmental body,
arbitrator or other authority having jurisdiction over the Company or the
Subsidiaries or any of its or their properties (other than U.S. Federal or
state securities or blue sky laws, other anti-fraud laws and fraudulent
transfer laws and bankruptcy, insolvency, reorganization, moratorium and
similar laws of general applicability relating to or affecting creditors'
rights, as to which such counsel need not express any opinion); and
(x) no holders of securities of the Company have rights to the
registration of such securities under the Registration Statement.
In rendering such opinion, such counsel may state that their opinion is limited
to matters governed by the Federal laws of the United States of America, the law
of the Commonwealth of Pennsylvania, the law of the State of New York and the
General Corporation Law of the State of Delaware. In rendering such opinion,
such counsel may rely (A) as to matters involving the application of laws of any
jurisdiction other than the Commonwealth of Pennsylvania, the State of Delaware,
the State of New York or the Federal laws of the United States and as to matters
involving the application of laws relating to intellectual property, to the
extent they deem proper and specified in such opinion, upon the opinion of other
counsel of good standing whom they believe to be reliable and who are
satisfactory to counsel for the Underwriters and (B) as to matters of fact, to
the extent they deem proper, on written statements or certificates of
responsible officers of the Company and public officials. References to the
Prospectus in this paragraph (b) include any supplements thereto at the Closing
Date.
20
Such counsel shall also have furnished to the Underwriters a written statement,
addressed to the Underwriters and dated the Closing Date (or the applicable
settlement date) to the effect that (i) the Registration Statement and the
Prospectus (other than the financial statements (including pro forma financial
statements and notes to financial statements or pro forma financial statements)
and related schedules and other financial, accounting or statistical information
included in or excluded from the Registration Statement or the Prospectus, as to
which such counsel need express no belief) appear on their face to be
appropriately responsive in all material respects to the requirements of the Act
and the rules and regulations thereunder and (ii) such counsel participated in
conferences with officers and representatives of the Company,
PricewaterhouseCoopers LLP, the Underwriters, the Selling Securityholder and
Cleary, Gottlieb, Xxxxx & Xxxxxxxx in connection with the preparation of the
Registration Statement, and based on the foregoing and without assuming
responsibility for the accuracy, completeness or fairness of the statements
contained in the Registration Statement except as provided in clause 6(b)(iv)
above or making any independent check or verification thereof (and relying as to
factual matters upon the statements of officers and other representatives of the
Company, the Selling Securityholder and others), no facts have come to the
attention of such counsel which lead them to believe that (I) the Registration
Statement, as of the Effective Date, contained any untrue statement of a
material fact or omitted to state a material fact required to be stated therein
or necessary in order to make the statements therein not misleading or (II) the
Prospectus, as of its date and as of the Closing Date (and any applicable
settlement date), contains any untrue statement of a material fact or omits to
state a material fact required to be stated therein or necessary in order to
make the statements therein, in the light of the circumstances under which they
were made, not misleading, except that such counsel need not express a belief as
to any financial statements (including pro forma financial statements and notes
to financial statements or pro forma financial statements) and related
schedules, and other financial, accounting or statistical information included
in or excluded from the Registration Statement or the Prospectus.
(c) The Selling Securityholder shall have requested and caused Dechert,
counsel for the Selling Securityholder, to have furnished to the Representatives
their opinion dated the Closing Date and addressed to the Representatives, to
the effect that:
(i) this Agreement has been duly authorized, executed and delivered by
the Selling Securityholder;
(ii) no consent, approval, authorization or order of any Pennsylvania
or U.S. Federal court or governmental agency or body is required for the
consummation by the Selling Securityholder of the transactions contemplated
herein, except (1) such as may have been obtained under the Act, (2) such
as may be required under the blue sky laws of any jurisdiction in
connection with the purchase and distribution of the Securities by the
Underwriters in the manner contemplated in this Agreement and in the
Prospectus, as to which such counsel need express no opinion, (3) such
other approvals (specified in such opinion) as have been obtained and (4)
where the failure to obtain such consent, approval, authorization, or order
would not have a material adverse effect on the sale of the
21
Securities or the consummation of any of the other transactions
contemplated herein; and
(iii) neither the sale of the Securities being sold hereunder by the
Selling Securityholder on the date of the opinion nor the consummation of
any other of the transactions contemplated herein by the Selling
Securityholder nor the fulfillment of the terms hereof by the Selling
Securityholder will (1) conflict with or result in a breach or violation of
the charter or by-laws of the Selling Securityholder, (2) result in a
material breach or violation of, or the imposition of any material lien,
charge or encumbrance upon any property or assets of the Selling
Securityholder pursuant to the terms of any material indenture, contract,
lease, mortgage, deed of trust, note agreement, loan agreement or other
agreement, obligation, condition, covenant or instrument known to such
counsel after due inquiry to which the Selling Securityholder is a party or
bound or to which its property is subject, or (3) conflict with or violate
in any material respect any Pennsylvania, New York or U.S. Federal statute,
law, rule or regulation applicable to the Selling Securityholder, or any
judgment, order or decree known to such counsel after due inquiry to be
applicable to the Selling Securityholder of any court, regulatory body,
administrative agency, governmental body, or arbitrator or other authority
having jurisdiction over the Selling Securityholder or any of its
properties (other than U.S. Federal or state securities or blue sky laws,
other anti-fraud laws and fraudulent transfer laws and bankruptcy,
insolvency, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights, as to which such
counsel need not express any opinion).
In rendering such opinion, such counsel may state that their opinion is limited
to matters governed by the Federal law of the United States of America, the law
of the Commonwealth of Pennsylvania and the law of the State of New York. In
rendering such opinion, such counsel may rely (A) as to matters involving the
application of laws of any jurisdiction other than the Commonwealth of
Pennsylvania, the State of New York or the Federal laws of the United States, to
the extent they deem proper and specified in such opinion, upon the opinion of
other counsel of good standing whom they believe to be reliable and who are
satisfactory to counsel for the Underwriters, and (B) as to matters of fact, to
the extent they deem proper, on certificates of responsible officers of the
Selling Securityholder and public officials.
(d) The Company shall have requested and caused Xxxxxxxx Xxxxxxxx,
special counsel for the Company and the Selling Securityholder, to have
furnished to the Representatives an opinion, dated the Closing Date and
addressed to the Representatives, to the effect that the statements
included in the Prospectus under the heading "Our Business--Intellectual
Property," insofar as such statements constitute a summary of the legal
matters or documents referred to therein, fairly present the information
called for with respect to such legal matters or documents.
(e) The Company shall have requested and caused Xxxxxxx X. Xxxxxxxxx,
Vice President, Secretary and General Counsel of the Selling
Securityholder, to have furnished
22
to the Representatives an opinion, dated the Closing Date and addressed to the
Representatives, to the effect that:
(i) each of the Company and Constar Inc. has been duly
incorporated and is validly existing as a corporation in good
standing under the laws of the jurisdiction in which it is
incorporated, with corporate power and corporate authority to own or
lease, as the case may be, and to operate its properties and conduct
its business as described in the Prospectus, and, in the case of the
Company, is duly qualified to do business as a foreign corporation
and is in good standing under the laws of the Commonwealth of
Pennsylvania;
(ii) the statements included in the Prospectus under the heading
"Our Business--Legal Matters," insofar as such statements constitute
a summary of the legal matters or documents referred to therein,
fairly present the information called for with respect to such legal
matters or documents;
(iii) no consent, approval, authorization, filing with or order
of any court or governmental agency or body is required for the
consummation by the Selling Securityholder, the Company or Constar
Inc. of the transactions contemplated herein, except(1)such as have
been obtained under the Act, (2) such as may be required under the
blue sky laws of any jurisdiction in connection with the purchase and
distribution of the Securities by the Underwriters in the manner
contemplated in this Agreement and in the Prospectus, as to which
such counsel need express no opinion, and (3) such other approvals
(specified in such opinion) as have been obtained;
(iv) neither the sale of the Securities by the Selling
Securityholder on the date of the opinion nor the consummation of
any other of the transactions contemplated herein nor the
fulfillment of the terms hereof will (1) conflict with or result in
a breach or violation of the charter of by-laws of the Selling
Securityholder, the Company or Constar Inc., (2) result in a
material breach or violation of, or the imposition of any material
lien, charge or encumbrance upon any property or assets of, the
Selling Securityholder, the Company or Constar Inc. pursuant to the
terms of any material indenture, contract, lease, mortgage, deed of
trust, note agreement, loan agreement or other agreement,
obligation, condition, covenant or instrument to which the Selling
Securityholder, the Company or any Subsidiary is a party or bound or
to which any of its or their property is subject, or (3) conflict
with or violate in any material respect any Pennsylvania, New York
or U.S. Federal statute, law, rule or regulation applicable to the
Selling Securityholder, the Company or the Subsidiaries, or any
judgment or order applicable to the Selling Securityholder, the
Company or the Subsidiaries of any court, regulatory body,
administrative agency, governmental body, arbitrator or other
authority having jurisdiction over the Selling Securityholder, the
Company or the Subsidiaries or any of its or their properties (other
than U.S. Federal or state securities or blue sky laws, other
anti-fraud laws and fraudulent transfer laws and bankruptcy,
insolvency, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights, as to
which such counsel need not express
23
any opinion); and
(v) there is no pending or, to such counsel's knowledge, threatened
action, suit or proceeding by or before any court or governmental agency,
authority or body or any arbitrator involving the Selling Securityholder,
the Company or any Subsidiary or its or their property of a character
required to be disclosed in the Registration Statement which is not
adequately disclosed in the Prospectus, and there is no franchise, contract
or other document of a character required to be described in the
Registration Statement or the Prospectus, or to be filed as an exhibit
thereto, which is not described or filed as required.
Such counsel shall also have furnished to the Underwriters a written statement,
addressed to the Underwriters and dated the Closing Date (or the applicable
settlement date) to the effect that (i) the Registration Statement and the
Prospectus (other than the financial statements (including pro forma financial
statements and notes to financial statements or pro forma financial statements)
and related schedules and other financial, accounting or statistical information
included in or excluded from the Registration Statement or the Prospectus, as to
which such counsel need express no belief) appear on their face to be
appropriately responsive in all material respects to the requirements of the Act
and the rules and regulations thereunder and (ii) no facts have come to the
attention of such counsel which lead it to believe that (I) the Registration
Statement, as of the Effective Date, contained any untrue statement of a
material fact or omitted to state a material fact required to be stated therein
or necessary in order to make the statements therein not misleading or (II) the
Prospectus, as of its date and as of the Closing Date (and any applicable
settlement date), contains any untrue statement of a material fact or omits to
state a material fact required to be stated therein or necessary in order to
make the statements therein, in the light of the circumstances under which they
were made, not misleading, except that such counsel need not express a belief as
to any financial statements (including pro forma financial statements and notes
to financial statements or pro forma financial statements) and related
schedules, and other financial, accounting or statistical information included
in or excluded from the Registration Statement or the Prospectus.
In rendering such opinion, such counsel may state that his opinion is limited to
matters governed by the Federal law of the United States of America and the law
of the Commonwealth of Pennsylvania.
(f) The Representatives shall have received from Cleary, Gottlieb, Xxxxx &
Xxxxxxxx, counsel for the Underwriters, such opinion or opinions, dated the
Closing Date and addressed to the Representatives, with respect to the sale of
the Securities, the Registration Statement, the Prospectus (together with any
supplement thereto) and other related matters as the Representatives may
reasonably require, and the Company and the Selling Securityholder shall have
furnished to such counsel such documents as they request for the purpose of
enabling them to pass upon such matters.
(g) The Company shall have furnished to the Representatives a certificate
of the Company, signed by the Chairman of the Board or the President, and the
principal
24
financial or accounting officer of the Company, dated the Closing Date, to
the effect that the signers of such certificate have carefully examined the
Registration Statement, the Prospectus, any supplements to the Prospectus
and this Agreement and that:
(i) the representations and warranties of the Company in this
Agreement are true and correct on and as of the Closing Date with the
same effect as if made on the Closing Date and the Company has
complied with all the agreements and satisfied all the conditions on
its part to be performed or satisfied at or prior to the Closing Date;
(ii) no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that
purpose have been instituted or, to the Company's knowledge,
threatened; and
(iii) since the date of the most recent financial statements
included in the Prospectus (exclusive of any supplement thereto),
there has been no material adverse change in the condition (financial
or otherwise), earnings, business or properties of the Company and its
subsidiaries, taken as a whole, whether or not arising from
transactions in the ordinary course of business, except as set forth
in or contemplated in the Prospectus (exclusive of any supplement
thereto).
(h) The Selling Securityholder shall have furnished to the
Representatives a certificate, signed by the Chairman of the Board or the
President, and the principal financial or accounting officer of the Selling
Securityholder, dated the Closing Date, to the effect that the signers of
such certificate have carefully examined the Registration Statement, the
Prospectus, any supplements to the Prospectus and this Agreement and that:
(i) the representations and warranties of the Selling
Securityholder in this Agreement are true and correct on and as of the
Closing Date to the same effect as if made on the Closing Date; and
(ii) since the date of the most recent financial statements
included in the Prospectus (exclusive of any supplement thereto),
there has been no material adverse change in the condition (financial
or otherwise), earnings, business or properties of the Company and its
subsidiaries, taken as a whole, whether or not arising from
transactions in the ordinary course of business, except as set forth
in or contemplated in the Prospectus (exclusive of any supplement
thereto).
(i) The Company shall have requested and caused PricewaterhouseCoopers
LLP to have furnished to the Representatives, at the Execution Time and at
the Closing Date, letters, dated respectively as of the Execution Time and
as of the Closing Date and addressed to the Representatives, substantially
in the form of Exhibit B.
(j) Subsequent to the Execution Time or, if earlier, the dates as of
which information is given in the Registration Statement (exclusive of any
amendment thereof) and the Prospectus (exclusive of any supplement
thereto), there shall not have been (i) any change or decrease specified in
the letter or letters referred to in paragraph (i) of
25
this Section 6 or (ii) any change, or any development involving a
prospective change, in or affecting the condition (financial or otherwise),
earnings, business or properties of the Company and its subsidiaries, taken
as a whole, whether or not arising from transactions in the ordinary course
of business, except as set forth in or contemplated in the Prospectus
(exclusive of any supplement thereto) the effect of which, in any case
referred to in clause (i) or (ii) above, is, in the sole judgment of the
Representatives, so material and adverse as to make it impractical or
inadvisable to proceed with the offering or delivery of the Securities as
contemplated by the Registration Statement (exclusive of any amendment
thereof) and the Prospectus (exclusive of any supplement thereto).
(k) At the Execution Time, the Company shall have furnished to the
Representatives a letter addressed to the Representatives substantially in
the form of Exhibit A hereto from each officer and director of the Company
and the Selling Securityholder, which persons are listed on Schedule II
hereto, and all participants in the Directed Share Program.
(l) The Securities shall have been listed and admitted and authorized
for quotation on the Nasdaq National Market, and satisfactory evidence of
such actions shall have been provided to the Representatives.
(m) On or prior to the Closing Date, the Company shall have (i)
consummated the transactions contemplated under the caption "Relationship
with Crown Cork & Seal Company, Inc." in the Prospectus, (ii) completed the
Senior Subordinated Notes Offering, (iii) obtained $150 million of term
loans, as described in the Prospectus, and (iv) entered into a revolving
credit facility of at least $75 million, as described in the Prospectus.
(n) The Selling Securityholder shall have received a written release
of the liens on the Common Stock and the capital stock of the Subsidiaries
from the lenders under the Crown Credit Agreement.
(o) Prior to the Closing Date, the Company and the Selling
Securityholder shall have furnished to the Representatives such further
information, certificates and documents as the Representatives may
reasonably request.
If any of the conditions specified in this Section 6 shall not have
been fulfilled when and as provided in this Agreement, or if any of the opinions
and certificates mentioned above or elsewhere in this Agreement shall not be
reasonably satisfactory in form and substance to the Representatives and counsel
for the Underwriters, this Agreement and all obligations of the Underwriters
hereunder may be canceled at, or at any time prior to, the Closing Date by the
Representatives. Notice of such cancellation shall be given to the Company and
the Selling Securityholder in writing or by telephone or facsimile confirmed in
writing.
The documents required to be delivered by this Section 6 shall be
delivered at the office of Dechert, counsel for the Company and the Selling
Securityholders, at 4000 Xxxx Atlantic Tower, 0000 Xxxx Xxxxxx, Xxxxxxxxxxxx, XX
00000, on the Closing Date.
7. Reimbursement of Underwriters' Expenses. If the sale of the
Securities provided for herein is not consummated because any condition to the
obligations of the
26
Underwriters set forth in Section 6 hereof is not satisfied, because of any
termination pursuant to Section 10 hereof or because of any refusal, inability
or failure on the part of the Company or the Selling Securityholder to perform
any agreement herein or comply with any provision hereof other than by reason of
a default by any of the Underwriters, the Selling Securityholder will reimburse
the Underwriters severally through Xxxxxxx Xxxxx Barney Inc. on demand for all
reasonable out-of-pocket expenses (including reasonable fees and disbursements
of counsel) that shall have been incurred by them in connection with the
proposed purchase and sale of the Securities.
8. Indemnification and Contribution. (a) The Company agrees to
indemnify and hold harmless each Underwriter, the directors, officers, employees
and agents of each Underwriter and each person who controls any Underwriter
within the meaning of either the Act or the Exchange Act against any and all
losses, claims, damages or liabilities, joint or several, to which they or any
of them may become subject under the Act, the Exchange Act or other Federal or
state statutory law or regulation, at common law or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon any untrue statement or alleged untrue statement of a
material fact contained in the registration statement for the registration of
the Securities as originally filed or in any amendment thereof, or in any
Preliminary Prospectus or the Prospectus, or in any amendment thereof or
supplement thereto, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, and agree to reimburse
each such indemnified party, as incurred, for any legal or other expenses
reasonably incurred by them in connection with investigating or defending any
such loss, claim, damage, liability or action; provided, however, that the
Company will not be liable in any such case to the extent that any such loss,
claim, damage, liability or expense arises out of or is based upon any such
untrue statement or alleged untrue statement or omission or alleged omission
made therein in reliance upon and in conformity with written information
furnished to the Company by or on behalf of any Underwriter through the
Representatives specifically for inclusion therein; provided further that with
respect to any untrue statement or omission of material fact made in any
Preliminary Prospectus, the indemnity agreement contained in this Section 8(a)
shall not inure to the benefit of any Underwriter from whom the person asserting
any such loss, claim, damage or liability purchased the securities concerned, to
the extent that any such loss, claim, damage or liability of such Underwriter
occurs under the circumstance where it shall have been determined by a court of
competent jurisdiction by final and nonappealable judgment that (w) the Company
had previously furnished copies of the Prospectus to the Representatives, (x)
delivery of the Prospectus was required by the Act to be made to such person,
(y) the untrue statement or omission of a material fact contained in the
Preliminary Prospectus was corrected in the Prospectus and (z) there was not
sent or given to such person, at or prior to the written confirmation of the
sale of such securities to such person, a copy of the Prospectus. This indemnity
agreement will be in addition to any liability which the Company may otherwise
have.
(b) The Company agrees to indemnify and hold harmless Xxxxxxx Xxxxx
Xxxxxx Inc., the directors, officers, employees and agents of Xxxxxxx Xxxxx
Barney Inc. and each person, who controls Xxxxxxx Xxxxx Xxxxxx Inc. within the
meaning of either the Act or the Exchange Act ("Xxxxxxx Xxxxx Barney Inc.
Entities"), from and against any and all losses, claims, damages and liabilities
to which they may become subject under the Act, the Exchange
27
Act or other Federal or state statutory law or regulation, at common law or
otherwise (including, without limitation, any legal or other expenses reasonably
incurred in connection with defending or investigating any such action or
claim), insofar as such losses, claims damages, liabilities or expenses (or
actions in respect thereof) (i) arise out of or are based upon any untrue
statement or alleged untrue statement of a material fact contained in the
prospectus wrapper material prepared by or with the consent of the Company for
distribution in foreign jurisdictions in connection with the Directed Share
Program attached to the Prospectus or any preliminary prospectus, or arise out
of or are based upon any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statement
therein, when considered in conjunction with the Prospectus or any applicable
preliminary prospectus, not misleading; (ii) are caused by the failure of any
Participant to pay for and accept delivery of the Directed Shares allocated by
the Company to such Participant if such Participant previously submitted an
indication of interest to Xxxxxxx Xxxxx Xxxxxx Inc., as agent for the Company;
or (iii) relate to, arise out of, or occur in connection with the Directed Share
Program, provided that, in the case of clause (i) the Company will not be liable
in any such case to the extent that any such loss, claim, damage or liability
arises out of or is based upon any such untrue statement or alleged untrue
statement or omission or alleged omission made therein in reliance upon and in
conformity with written information furnished to the Company by or on behalf of
Xxxxxxx Xxxxx Barney Inc. specifically for inclusion therein and that in the
case of clause (iii) the Company will not be liable to the extent that such
loss, claim, damage or liability results from the gross negligence or willful
misconduct of Xxxxxxx Xxxxx Xxxxxx Inc.
(c) Each Underwriter severally and not jointly agrees to indemnify and
hold harmless the Company, each of its directors, each of its officers who signs
the Registration Statement, each person who controls the Company within the
meaning of either the Act or the Exchange Act, and the Selling Securityholder,
to the same extent as the indemnity to each Underwriter set forth in paragraph
(a) of this Section 8, but only with reference to written information relating
to such Underwriter furnished to the Company by or on behalf of such Underwriter
through the Representatives specifically for inclusion in the documents referred
to in the foregoing indemnity. This indemnity agreement will be in addition to
any liability which any Underwriter may otherwise have. Each of the Company and
the Selling Securityholder acknowledge that the statements set forth in the last
paragraph of the cover page regarding delivery of the Securities and, under the
heading "Underwriting," (i) the list of underwriters and their respective
participation in the sale of the Securities, (ii) the paragraph related to
concessions and reallowances, (iii) the paragraphs related to stabilization,
syndicate covering transactions and penalty bids, (iv) the paragraph related to
electronic distribution of any Preliminary Prospectus or the Prospectus and
allocation for electronic distribution of the Securities and (v) the paragraph
related to the assumption by Lazard Freres & Co. LLC (the "Independent
Underwriter") of all responsibilities as a "qualified independent underwriter"
(within the meaning of NASD conduct rule 2720), constitute the only written
information furnished to the Company by or on behalf of the several Underwriters
through the Representatives specifically for inclusion in any Preliminary
Prospectus or the Prospectus.
(d) Promptly after receipt by an indemnified party under this Section
8 of notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against the indemnifying party under this
Section 8, notify the indemnifying party in writing of the commencement thereof;
but the failure so to notify the indemnifying party (i) will
28
not relieve it from liability under paragraph (a), (b) or (c) of this Section 8
unless and to the extent it did not otherwise learn of such action and such
failure results in the forfeiture by the indemnifying party of substantial
rights and defenses and (ii) will not, in any event, relieve the indemnifying
party from any obligations to any indemnified party other than the
indemnification obligation provided in paragraph (a), (b) or (c) of this Section
8. The indemnifying party shall be entitled to appoint counsel of the
indemnifying party's choice at the indemnifying party's expense to represent the
indemnified party in any action for which indemnification is sought (in which
case the indemnifying party shall not thereafter be responsible for the fees and
expenses of any separate counsel retained by the indemnified party or parties
except as set forth below); provided, however, that such counsel shall be
reasonably satisfactory to the indemnified party. Notwithstanding the
indemnifying party's election to appoint counsel to represent the indemnified
party in an action, the indemnified party shall have the right to employ
separate counsel (including local counsel), and the indemnifying party shall
bear the reasonable fees, costs and expenses of such separate counsel if (1) the
use of counsel chosen by the indemnifying party to represent the indemnified
party would present such counsel with a conflict of interest, (2) the actual or
potential defendants in, or targets of, any such action include both the
indemnified party and the indemnifying party and the indemnified party shall
have reasonably concluded that there may be legal defenses available to it
and/or other indemnified parties which are different from or additional to those
available to the indemnifying party, (3) the indemnifying party shall not have
employed counsel satisfactory to the indemnified party to represent the
indemnified party within a reasonable time after notice of the institution of
such action or (4) the indemnifying party shall authorize the indemnified party
to employ separate counsel at the expense of the indemnifying party. An
indemnifying party will not, without the prior written consent of the
indemnified parties, 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. An indemnifying party
shall not be liable under this Section 8 to any indemnified party regarding any
settlement 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 is consented to by such
indemnifying party, which consent shall not be unreasonably withheld.
Notwithstanding anything contained herein to the contrary, if indemnity may be
sought pursuant to paragraph (b) of this Section 8 in respect of such action or
proceeding, then in addition to such separate firm for the indemnified parties,
the indemnifying party shall be liable for the reasonable fees and expenses of
not more than one separate firm (in addition to any local counsel) for Xxxxxxx
Xxxxx Xxxxxx Inc., the directors, officers, employees and agents of Xxxxxxx
Xxxxx Barney Inc., and all persons, if any, who control Xxxxxxx Xxxxx Xxxxxx
Inc. within the meaning of either the Act or the Exchange Act for the defense of
any losses, claims, damages or liabilities arising out of the Directed Share
Program.
(e) In the event that the indemnity provided in paragraph (a), (b) or
(c) of this Section 8 is unavailable to or insufficient to hold harmless an
indemnified party for any reason, the Company and the Underwriters severally
agree to contribute to the aggregate losses, claims, damages and liabilities
(including legal or other expenses reasonably incurred in connection with
29
investigating or defending same) (collectively "Losses") to which the Company,
and one or more of the Underwriters may be subject in such proportion as is
appropriate to reflect the relative benefits received by the Company on the one
hand and by the Underwriters on the other from the offering of the Securities;
provided, however, that in no case shall (i) any Underwriter (except as may be
provided in any agreement among underwriters relating to the offering of the
Securities) be responsible for any amount in excess of the underwriting discount
or commission applicable to the Securities purchased by such Underwriter
hereunder or (ii) the Independent Underwriter in its capacity as "qualified
independent underwriter" (within the meaning of National Association of
Securities Dealers, Inc. Conduct Rule 2720) be responsible for any amount in
excess of the compensation received by the Independent Underwriter for acting in
such capacity. If the allocation provided by the immediately preceding sentence
is unavailable for any reason, the Company and the Underwriters severally shall
contribute in such proportion as is appropriate to reflect not only such
relative benefits but also the relative fault of the Company on the one hand and
of the Underwriters on the other in connection with the statements or omissions
which resulted in such Losses as well as any other relevant equitable
considerations. Benefits received by the Company shall be deemed to be equal to
the total net proceeds from the offering (before deducting expenses) received by
the Company, and benefits received by the Underwriters shall be deemed to be
equal to the total underwriting discounts and commissions, in each case as set
forth on the cover page of the Prospectus. Benefits received by the Independent
Underwriter in its capacity as "qualified independent underwriter" shall be
deemed to be equal to the compensation received by the Independent Underwriter
for acting in such capacity. Relative fault shall be determined by reference to,
among other things, whether any untrue or any alleged untrue statement of a
material fact or the omission or alleged omission to state a material fact
relates to information provided by the Company on the one hand or the
Underwriters on the other, the intent of the parties and their relative
knowledge, access to information and opportunity to correct or prevent such
untrue statement or omission. The Company and the Underwriters agree that it
would not be just and equitable if contribution were determined by pro rata
allocation or any other method of allocation which does not take account of the
equitable considerations referred to above. Notwithstanding the provisions of
this paragraph (e), no person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Act) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation. For purposes of
this Section 8, each person who controls an Underwriter within the meaning of
either the Act or the Exchange Act and each director, officer, employee and
agent of an Underwriter shall have the same rights to contribution as such
Underwriter, and each person who controls the Company within the meaning of
either the Act or the Exchange Act, each officer of the Company who shall have
signed the Registration Statement and each director of the Company shall have
the same rights to contribution as the Company, subject in each case to the
applicable terms and conditions of this paragraph (e).
(f) The liability of the Selling Securityholder under the Selling
Securityholder's representations and warranties contained in Section 1 hereof
and under the indemnity and contribution agreements contained in this Section 8
shall be limited to an amount equal to the initial public offering price of the
Securities sold by the Selling Securityholder to the Underwriters, after
deducting discounts and commissions received by the Underwriters. The Company
and the Selling Securityholder may agree, as between themselves and without
limiting the rights of the Underwriters under this Agreement, as to the
respective amounts of such liability for which they each shall be responsible.
30
(g) Without limitation of and in addition to its obligations under the
other paragraphs of this Section 8, the Company agrees to indemnify and hold
harmless the Independent Underwriter, its directors, officers, employees and
agents and each person who controls Independent Underwriter within the meaning
of either the Act or the Exchange Act against any and all losses, claims,
damages or liabilities, joint or several, to which they or any of them may
become subject, insofar as such losses, claims, damages or liabilities (or
action in respect thereof) arise out of or are based upon Independent
Underwriter's acting as a "qualified independent underwriter" (within the
meaning of National Association of Securities Dealers, Inc. Conduct Rule 2720)
in connection with the offering contemplated by this Agreement, and agrees to
reimburse each such indemnified party, as incurred, for any legal or other
expenses reasonably incurred by them in connection with investigating or
defending any such loss, claim, damage, liability or action; provided, however,
that the Company will not be liable in any such case to the extent that any such
loss, claim, damage or liability results from the gross negligence or willful
misconduct of the Independent Underwriter.
(h) In the event that the indemnity and contribution provided in
paragraph (a), (b), (e) or (g) of this Section 8 is unavailable to or
insufficient to hold harmless any Underwriter, any director, officer, employee
or agent of any Underwriter or any person who controls any Underwriter within
the meaning of either the Act or the Exchange Act by reason of the Company
having failed to fulfill in any respect its payment obligations under any such
paragraph, the Selling Securityholder agrees to indemnify and hold harmless any
such indemnified person, or to contribute to the Losses of any such indemnified
person, as the case may be, to the extent of such unavailability or
insufficiency.
9. Default by an Underwriter. If any one or more Underwriters shall
fail to purchase and pay for any of the Securities agreed to be purchased by
such Underwriter or Underwriters hereunder and such failure to purchase shall
constitute a default in the performance of its or their obligations under this
Agreement, the remaining Underwriters shall be obligated severally to take up
and pay for (at the price per share set forth in Section 2(a) and in the
respective proportions which the amount of Securities set forth opposite their
names in Schedule I hereto bears to the aggregate amount of Securities set forth
opposite the names of all the remaining Underwriters) the Securities which the
defaulting Underwriter or Underwriters agreed but failed to purchase; provided,
however, that in the event that the aggregate amount of Securities which the
defaulting Underwriter or Underwriters agreed but failed to purchase shall
exceed 10% of the aggregate amount of Securities set forth in Schedule I hereto,
the remaining Underwriters shall have the right to purchase all, but shall not
be under any obligation to purchase any, of the Securities, and if such
nondefaulting Underwriters do not purchase all the Securities, this Agreement
will terminate without liability to any nondefaulting Underwriter, the Selling
Securityholder or the Company. In the event of a default by any Underwriter as
set forth in this Section 9, the Closing Date shall be postponed for such
period, not exceeding five Business Days, as the Representatives shall determine
in order that the required changes in the Registration Statement and the
Prospectus or in any other documents or arrangements may be effected. Nothing
contained in this Agreement and no action taken under this paragraph shall
relieve any defaulting Underwriter of its liability, if any, to the Company, the
Selling Securityholder and any nondefaulting Underwriter for damages occasioned
by its default hereunder.
31
10. Termination. This Agreement shall be subject to termination in the
-----------
absolute discretion of the Representatives, by notice given to the Company prior
to delivery of and payment for the Securities, if at any time prior to such time
(i) trading in the Company's Common Stock shall have been suspended by the
Commission or the Nasdaq National Market or trading in securities generally on
the New York Stock Exchange or the Nasdaq National Market shall have been
suspended or limited or minimum prices shall have been established on such
Exchange or the Nasdaq National Market, (ii) a banking moratorium shall have
been declared either by Federal or New York State authorities or (iii) there
shall have occurred any outbreak or escalation of hostilities, declaration by
the United States of a national emergency or war, or other calamity or crisis
the effect of which on financial markets is such as to make it, in the sole
judgment of the Representatives, impractical or inadvisable to proceed with the
offering or delivery of the Securities as contemplated by the Prospectus
(exclusive of any supplement thereto).
11. Representations and Indemnities to Survive. The respective agreements,
------------------------------------------
representations, warranties, indemnities and other statements of the Company or
its officers, of the Selling Securityholder and of the Underwriters set forth in
or made pursuant to this Agreement will remain in full force and effect,
regardless of any investigation made by or on behalf of any Underwriter, the
Selling Securityholder or the Company or any of the officers, directors,
employees, agents or controlling persons referred to in Section 8 hereof, and
will survive delivery of and payment for the Securities. The provisions of
Sections 7, 8 and 14 hereof shall survive the termination or cancellation of
this Agreement.
12. Notices. All communications hereunder will be in writing and effective
-------
only on receipt, and, if sent to the Representatives, will be mailed, delivered
or telefaxed to the Xxxxxxx Xxxxx Xxxxxx Inc. General Counsel (fax no.: (212)
000-0000) and confirmed to the General Counsel, Xxxxxxx Xxxxx Barney Inc., at
000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: General Counsel; or,
if sent to the Company, will be mailed, delivered or telefaxed to Xxxxxxx X.
Xxxxxxx, President and Chief Executive Officer, Constar International Inc., Xxx
Xxxxx Xxx, Xxxxxxxxxxxx, XX 00000, fax (000) 000-0000 and confirmed to Xxxxxxx
X. Lawlor, Dechert, 4000 Xxxx Atlantic Tower, 0000 Xxxx Xxxxxx, Xxxxxxxxxxxx, XX
00000, fax (000) 000-0000; or if sent to the Selling Securityholder, will be
mailed, delivered or telefaxed and confirmed to Xxxxxxx X. Xxxxxxx, Crown Cork &
Seal Company, Inc., Xxx Xxxxx Xxx, Xxxxxxxxxxxx, XX 00000, fax (000) 000-0000
and confirmed to Xxxxxxx X. Lawlor, Dechert, 4000 Xxxx Atlantic Tower, 0000 Xxxx
Xxxxxx, Xxxxxxxxxxxx, XX 00000, fax (000) 000-0000.
13. Successors. This Agreement will inure to the benefit of and be binding
----------
upon the parties hereto and their respective successors and the officers,
directors, employees, agents and controlling persons referred to in Section 8
hereof, and no other person will have any right or obligation hereunder.
14. Applicable Law. This Agreement will be governed by and construed in
--------------
accordance with the laws of the State of New York applicable to contracts made
and to be performed within the State of New York.
32
15. Counterparts. This Agreement may be signed in one or more counterparts,
------------
each of which shall constitute an original and all of which together shall
constitute one and the same agreement.
16. Headings. The section headings used herein are for convenience only and
--------
shall not affect the construction hereof.
17. Definitions. The terms which follow, when used in this Agreement, shall
-----------
have the meanings indicated.
"Act" shall mean the Securities Act of 1933, as amended, and
the rules and regulations of the Commission promulgated thereunder.
"Business Day" shall mean any day other than a Saturday, a
Sunday or a legal holiday or a day on which banking institutions or
trust companies are authorized or obligated by law to close in New York
City.
"Commission" shall mean the Securities and Exchange
Commission.
"Effective Date" shall mean each date and time that the
Registration Statement, any post-effective amendment or amendments
thereto and any Rule 462(b) Registration Statement became or become
effective.
"Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended, and the rules and regulations of the Commission promulgated
thereunder.
"Execution Time" shall mean the date and time that this
Agreement is executed and delivered by the parties hereto.
"Material Adverse Effect" shall mean any material adverse
effect on the condition (financial or otherwise), earnings, business or
properties of the Company and its subsidiaries, taken as a whole,
whether or not arising from transactions in the ordinary course of
business, except as set forth in or contemplated in the Prospectus
(exclusive of any supplement thereto).
"Preliminary Prospectus" shall mean any preliminary prospectus
referred to in Section 1(i)(a) hereof and any preliminary prospectus
included in the Registration Statement at the Effective Date that omits
Rule 430A Information.
"Prospectus" shall mean the prospectus relating to the
Securities that is first filed pursuant to Rule 424(b) after the
Execution Time or, if no filing pursuant to Rule 424(b) is required,
shall mean the form of final prospectus relating to the Securities
included in the Registration Statement at the Effective Date.
"Registration Statement" shall mean the registration statement
referred to in Section 1(i)(a) hereof, including exhibits and financial
statements, as amended at the Execution Time (or, if not effective at
the Execution Time, in the form in which it shall become effective),
and, in the event any post-effective amendment thereto or any
33
Rule 462(b) Registration Statement becomes effective prior to the
Closing Date, shall also mean such registration statement as so
amended or such Rule 462(b) Registration Statement, as the case may
be. Such term shall include any Rule 430A Information deemed to be
included therein at the Effective Date as provided by Rule 430A.
"Rule 424", "Rule 430A" and "Rule 462" refer to such rules
under the Act.
"Rule 430A Information" shall mean information with respect to
the Securities and the offering thereof permitted to be omitted from
the Registration Statement when it becomes effective pursuant to Rule
430A.
"Rule 462(b) Registration Statement" shall mean a registration
statement and any amendments thereto filed pursuant to Rule 462(b)
relating to the offering covered by the registration statement
referred to in Section 1(i)(a) hereof.
"Subsidiary" shall mean the subsidiaries of the Company listed
in Annex A hereto.
34
If the foregoing is in accordance with your understanding of our agreement,
please sign and return to us the enclosed duplicate hereof, whereupon this
letter and your acceptance shall represent a binding agreement among the Selling
Securityholder, the Company and the several Underwriters.
Very truly yours,
Constar International Inc.
By: /s/ Xxxxx X. Xxxx
--------------------------
Name: Xxxxx X. Xxxx
Title: Executive Vice President,
Chief Financial Officer
and Secretary
Crown Cork & Seal Company, Inc.
By: /s/ Xxxx X. Xxxxxxxxxx
--------------------------
Name: Xxxx X. Xxxxxxxxxx
Title: Executive Vice President
and Chief Financial
Officer
Attest:
[Corporate Seal]
By: /s/ Xxxxxxx X. Xxxxxxxxx
--------------------------
Name: Xxxxxxx X. Xxxxxxxxx
Title: Secretary
35
The foregoing Agreement is hereby confirmed and accepted as of the date first
above written.
Xxxxxxx Xxxxx Xxxxxx Inc.
Deutsche Bank Securities Inc.
X.X. Xxxxxx Securities Inc.
By: Xxxxxxx Xxxxx Xxxxxx Inc.
By: /s/ Xxxxxx Xxxxxxxx
--------------------------
Name: Xxxxxx Xxxxxxxx
Title: Managing Director
For themselves and the other several Underwriters named in Schedule I to the
foregoing Agreement.
36
SCHEDULE I
----------
Underwriters Number of Number of Incremental
------------ Underwritten Securities Securities to be Purchased
(Exclusive of Incremental --------------------------
Shares) to be Purchased
-----------------------
Xxxxxxx Xxxxx Barney Inc. 3,780,000 540,000
Deutsche Bank Securities Inc. 3,780,000 540,000
X.X. Xxxxxx Securities Inc. 1,890,000 270,000
Bear, Xxxxxxx & Co. Inc. 393,750 56,250
Lazard Freres & Co. LLC 393,750 56,250
Xxxxxxxx & Partners, L.P. 43,750 6,250
Chatsworth Securities LLC 43,750 6,250
First Analysis Securities Corporation 43,750 6,250
Jesup & Xxxxxx Securities Corporation 43,750 6,250
Midwest Research 43,750 6,250
Xxxxxxxxxx & Co., Inc. 43,750 6,250
---------- ---------
Total 10,500,000 1,500,000
========== =========
SCHEDULE II
-----------
Name Position
Xxxxxxx X. Xxxxxxxxx Vice President of Operations, Constar, Inc.
Xxxxxxx X. Xxxxx Executive Vice President & President of the
European Division, the Selling Securityholder
Xxxxx C.T. Xxxxxx Senior Vice President, Administration & Strategic
Planning, the Company
Xxxxx X. Xxxxxxx Director, the Selling Securityholder
Xxxxxxx X. Xxxxx Chairman of the Board of Directors, the Company
Xxxx X. Xxxxxx Director, the Company; Chairman of the Board,
President & Chief Executive Officer, the Selling
Securityholder
Xxxxx X. Xxxx Executive Vice President, Chief Financial Officer,
Secretary & Director, the Company
Xxxxxx X. Xxxxx Vice President of Research and Development,
Constar, Inc.
Xxxxxx X. Xxxxxx Director, the Selling Securityholder
Xxxxxx du Rouret Director, the Selling Securityholder
Xxxxx X. Xxxxxxxxx Director, the Selling Securityholder
Xxxxx X. Xxxxxxx Vice President, European Operations, the Company
Xxxxxxx X. Xxxxxxx President, Chief Executive Officer & Director, the
Company
Xxxxxxx X. Xxxxxx Director, the Company
Xxxx X. Xxxxxxx Director, the Selling Securityholder
Xxxxxx X. Xxxxx Vice President & Corporate Controller, the Selling
Securityholder
Xxxxx X. Xxxxxxx Director, the Company; Executive Vice President &
President of the Americas Division, the Selling
Securityholder
Xxxx X. Xxxx Director, the Selling Securityholder
Xxxxx X. Xxxx Director, the Selling Securityholder
Xxxxxx X. Xxxxx Director, the Selling Securityholder
Xxxx X. Xxxxxxxxxx Director, the Company; Vice Chairman of the Board,
Executive Vice President & Chief Financial Officer,
the Selling Securityholder
L. Xxxxxxx Xxxxx Senior Vice President, Sales and
Marketing, the Company
Xxxxxx X. Xxxxxxxx Director, the Selling Securityholder
Xxxxx X. Xxxxx Director, the Company
Xxxxxxx X. Xxxx Executive Vice President & President of the Asia
Pacific Division, the Selling Securityholder
ANNEX A: SUBSIDIARIES
Entity Jurisdiction of Incorporation
------ -----------------------------
Constar, Inc. ...........................................Pennsylvania
Constar Foreign Holdings, Inc. ..........................Delaware
Constar International Holland (Plastics) BV .............The Netherlands
Constar International UK Ltd. ...........................England
39
EXHIBIT A
[Form of Lock-Up Agreement]
[Letterhead of each officer or director of
Constar International Inc. or any participant in the Directed Share Program]
Constar International Inc.
Public Offering of Common Stock
________, ___2
Xxxxxxx Xxxxx Xxxxxx Inc.
Deutsche Bank Securities Inc.
X.X. Xxxxxx Securities Inc.
As Representatives of the several
Underwriters
c/o Xxxxxxx Xxxxx Xxxxxx Inc.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
This letter is being delivered to you in connection with the proposed
Underwriting Agreement (the "Underwriting Agreement"), among Constar
International Inc., a Delaware corporation (the "Company"), Crown Cork & Seal
Company, Inc, a Pennsylvania corporation and each of you as representatives of a
group of Underwriters named therein, relating to an underwritten public offering
of Common Stock, [$_.__][without] par value, of the Company.
In order to induce you and the other Underwriters to enter into the
Underwriting Agreement, the undersigned will not, without the prior written
consent of [for officers and directors of Constar International, Inc.: Xxxxxxx
Xxxxx Barney Inc. and Deutsche Bank Securities Inc.] [for participants in the
Directed Share Program: Xxxxxxx Xxxxx Xxxxxx Inc.], offer, sell, contract to
sell, pledge or otherwise dispose of (or enter into any transaction which is
designed to, or might reasonably be expected to, result in the disposition
(whether by actual disposition or effective economic disposition due to cash
settlement or otherwise) by the undersigned or any affiliate of the undersigned
or any person in privity with the undersigned or any affiliate of the
undersigned), directly or indirectly, including the filing (or participation in
the filing) of a registration statement with the Securities and Exchange
Commission in respect of, or establish or increase a put equivalent position or
liquidate or decrease a call equivalent
1
position within the meaning of Section 16 of the Securities Exchange Act of
1934, as amended, and the rules and regulations of the Securities and Exchange
Commission promulgated thereunder with respect to, any shares of capital stock
of the Company or any securities convertible into, or exercisable or
exchangeable for, such capital stock, or publicly announce an intention to
effect any such transaction, for a period of [for officers and directors of
Constar International, Inc.: 180 days] [for participants in the Directed Share
Program: 30 days] after the date of the Underwriting Agreement, other than any
such securities disposed of as bona fide gifts approved by Xxxxxxx Xxxxx Barney
Inc.
If for any reason the Underwriting Agreement shall be terminated prior to
the Closing Date (as defined in the Underwriting Agreement), the agreement set
forth above shall likewise be terminated.
Yours very truly,
By:
-----------------------
Name:
Title:
2
