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Exhibit 1.1
7,000,000 SHARES
FALCON DRILLING COMPANY, INC.
COMMON STOCK
($.01 PAR VALUE)
UNDERWRITING AGREEMENT
November , 1996
CS First Boston Corporation
Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities Corporation
Salomon Brothers Inc
Xxxxxxxx Xxxxxxxx & Co.
Xxxxxxx & Company International
As Representatives of the Several Underwriters,
c/o CS First Xxxxxx Xxxxxxxxxxx,
Xxxx Xxxxxx Xxxxx,
Xxx Xxxx, X.X. 00000.
Dear Sirs:
1. Introductory. Falcon Drilling Company, Inc., a Delaware
corporation ("Company"), proposes to issue and sell ("U.S. Offering") to the
several Underwriters named in Schedule A hereto ("Underwriters")
shares of its common stock, $.01 par value per share ("Securities"), and the
stockholders listed in Schedule B hereto ("Selling Stockholders") propose to
sell an aggregate of shares of the Securities (all such shares of
Company securities being hereinafter referred to as the "U.S. Firm
Securities").
It is understood that the Company is concurrently entering into a
Subscription Agreement, dated the date hereof ("Subscription Agreement"), with
CS First Boston Limited ("CSFBL"), , and the other managers named
therein ("Managers") relating to the concurrent offering and sale of
shares of Securities ("International Firm Securities") outside the United
States and Canada ("International Offering").
In addition, as set forth below the Company propose to issue and sell
and the Selling Stockholders propose to sell (i) to the Underwriters, at the
option of the Underwriters, an aggregate of not more than additional
shares of Securities (all of such additional shares being hereinafter referred
to as the "U.S. Optional Securities") and (ii) to the Managers, at the option
of the Managers, an aggregate of not more than additional shares of
Securities ("International Optional Securities" and, collectively with the U.S.
Optional Securities, the "Optional Securities"), such Optional Securities to be
provided in the respective amounts indicated on Schedule C hereto. The U.S.
Firm Securities and the U.S. Optional Securities are hereinafter called the
"U.S. Securities"; the International Firm Securities and the International
Optional Securities are hereinafter called the "International Securities"; the
U.S. Firm Securities and the International Firm Securities are hereinafter
called the "Firm Securities". The U.S. Securities and the International
Securities are collectively referred to as the "Offered Securities". To
provide for the coordination of their activities, the Underwriters and the
Managers have entered into an Agreement Between U.S. Underwriters and Managers
which permits them, among other things, to sell the Offered Securities to each
other for purposes of resale.
The Company and the Selling Stockholders hereby agree with the several
Underwriters as follows:
2. Representations and Warranties of the Company and the Selling
Stockholders. (a) The Company represents and warrants to, and agrees with, the
several Underwriters that:
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(i) A registration statement (No. 333- ) relating
to the Offered Securities, including a form of prospectus relating to
the U.S. Securities and a form of prospectus relating to the
International Securities being offered in the International Offering,
has been filed with the Securities and Exchange Commission
("Commission") and either (i) has been declared effective under the
Securities Act of 1933 ("Act") and is not proposed to be amended or
(ii) is proposed to be amended by amendment or post-effective
amendment. If such registration statement (the "initial registration
statement") has been declared effective, either (A) an additional
registration statement (the "additional registration statement")
relating to the Offered Securities may have been filed with the
Commission pursuant to Rule 462(b) ("Rule 462(b)") under the Act and,
if so filed, has become effective upon filing pursuant to such Rule
and the Offered Securities all have been duly registered under the Act
pursuant to the initial registration statement and, if applicable, the
additional registration statement or (B) such an additional
registration statement is proposed to be filed with the Commission
pursuant to Rule 462(b) and will become effective upon filing pursuant
to such Rule and upon such filing the Offered Securities will all have
been duly registered under the Act pursuant to the initial
registration statement and such additional registration statement. If
the Company does not propose to amend the initial registration
statement or if an additional registration statement has been filed
and the Company does not propose to amend it, and if any
post-effective amendment to either such registration statement has
been filed with the Commission prior to the execution and delivery of
this Agreement, the most recent amendment (if any) to each such
registration statement has been declared effective by the Commission
or has become effective upon filing pursuant to Rule 462(c) ("Rule
462(c)") under the Act or, in the case of the additional registration
statement, Rule 462(b). For purposes of this Agreement, "Effective
Time" with respect to the initial registration statement or, if filed
prior to the execution and delivery of this Agreement, the additional
registration statement means (i) if the Company has advised the
Representatives that it does not propose to amend such registration
statement, the date and time as of which such registration statement,
or the most recent post-effective amendment thereto (if any) filed
prior to the execution and delivery of this Agreement, was declared
effective by the Commission or has become effective upon filing
pursuant to Rule 462(c), or (ii) if the Company has advised the
Representatives that it proposes to file an amendment or
post-effective amendment to such registration statement, the date and
time as of which such registration statement, as amended by such
amendment or post-effective amendment, as the case may be, is declared
effective by the Commission. If an additional registration statement
has not been filed prior to the execution and delivery of this
Agreement but the Company has advised the Representatives that it
proposes to file one, "Effective Time" with respect to such additional
registration statement means the date and time as of which such
registration statement is filed and becomes effective pursuant to Rule
462(b). "Effective Date" with respect to the initial registration
statement or the additional registration statement (if any) means the
date of the Effective Time thereof. The initial registration
statement, as amended at its Effective Time, including all material
incorporated by reference therein, including all information contained
in the additional registration statement (if any) and deemed to be a
part of the initial registration statement as of the Effective Time of
the additional registration statement pursuant to the General
Instructions of the Form on which it is filed and including all
information (if any) deemed to be a part of the initial registration
statement as of its Effective Time pursuant to Rule 430A(b) ("Rule
430A(b)") under the Act, is hereinafter referred to as the "Initial
Registration Statement". The additional registration statement, as
amended at its Effective Time, including the contents of the initial
registration statement incorporated by reference therein and including
all information (if any) deemed to be a part of the additional
registration statement as of its Effective Time pursuant to Rule
430A(b), is hereinafter referred to as the "Additional Registration
Statement". The Initial Registration Statement and the Additional
Registration Statement are hereinafter referred to collectively as the
"Registration Statements" and individually as a "Registration
Statement".
The form of prospectus relating to the U.S. Securities and the
form of prospectus relating to the International Securities, each as
first filed with the Commission pursuant to and in accordance with
Rule 424(b) ("Rule 424(b)") under the Act or (if no such filing is
required) as included in the Registration Statement, including all
material incorporated by reference in each such prospectus, are
hereinafter referred to as the "U.S. Prospectus" and the
"International Prospectus", respectively, and collectively as the
"Prospectuses". No document has been or will be prepared or
distributed in reliance on Rule 434 under the Act.
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(ii) If the Effective Time of the Initial Registration
Statement is prior to the execution and delivery of this Agreement:
(i) on the Effective Date of the Initial Registration Statement, the
Initial Registration Statement conformed in all respects to the
requirements of the Act and the rules and regulations of the
Commission ("Rules and Regulations") and did not include any untrue
statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements
therein not misleading, (ii) on the Effective Date of the Additional
Registration Statement (if any), each Registration Statement
conformed, or will conform, in all respects to the requirements of the
Act and the Rules and Regulations and did not include, or will not
include, any untrue statement of a material fact and did not omit, or
will not omit, to state any material fact required to be stated
therein or necessary to make the statements therein not misleading,
and (iii) on the date of this Agreement, the Initial Registration
Statement and, if the Effective Time of the Additional Registration
Statement is prior to the execution and delivery of this Agreement,
the Additional Registration Statement each conforms, and at the time
of filing of each of the Prospectuses pursuant to Rule 424(b) or (if
no such filing is required) at the Effective Date of the Additional
Registration Statement in which the Prospectuses are included, each
Registration Statement and each of the Prospectuses will conform, in
all respects to the requirements of the Act and the Rules and
Regulations, and none of such documents includes, or will include, any
untrue statement of a material fact or omits, or will omit, to state
any material fact required to be stated therein or necessary to make
the statements therein not misleading. If the Effective Time of the
Initial Registration Statement is subsequent to the execution and
delivery of this Agreement: on the Effective Date of the Initial
Registration Statement, the Initial Registration Statement and each of
the Prospectuses will conform in all respects to the requirements of
the Act and the Rules and Regulations, none of such documents will
include any untrue statement of a material fact or will omit to state
any material fact required to be stated therein or necessary to make
the statements therein not misleading, and no Additional Registration
Statement has been or will be filed. The two preceding sentences do
not apply to statements in or omissions from a Registration Statement
or either of the Prospectuses based upon written information furnished
to the Company by any Underwriter through the Representatives or by
any Manager through CSFBL specifically for use therein, it being
understood and agreed that the only such information is that described
as such in Section 7(b).
(iii) Each of the Company and its corporate subsidiaries
has been duly incorporated, is validly existing as a corporation in
good standing under the laws of its jurisdiction of incorporation and
has the corporate power and authority to carry on its business as it
is currently being conducted and to own, lease and operate its
properties, and each is duly qualified and is in good standing as a
foreign corporation authorized to do business in each jurisdiction in
which the nature of its business or its ownership or leasing of
property requires such qualification, except where the failure to be
so qualified would not have a material adverse effect on the Company
and its subsidiaries, taken as a whole.
(iv) Each partnership subsidiary of the Company has been
duly formed, is validly existing as a partnership and, with respect to
each limited partnership subsidiary of the Company, is in good
standing under the laws of the jurisdiction of its formation and has
the requisite power and authority to carry on its business as it is
currently being conducted and to own, lease and operate its
properties, and each is duly qualified and is in good standing as a
foreign partnership authorized to do business in each jurisdiction in
which the nature of its business or the ownership or leasing of
property requires such qualification, except where the failure to be
so qualified would not have a material adverse effect on the Company
and its subsidiaries, taken as a whole.
(v) All the outstanding shares of capital stock of, or other
ownership interests in, each of the Company's subsidiaries have been
duly authorized and validly issued and are fully paid and
nonassessable, and are owned by the Company or one of the Company's
wholly owned subsidiaries, free and clear of any security interest,
claim, lien, encumbrance or adverse interest of any nature. Except as
disclosed in the Prospectuses and except for the shares of capital
stock of the Company's subsidiaries, neither the Company nor any
corporate or partnership subsidiary owns or holds, directly or
indirectly, a material number of shares of capital stock or any other
securities of any corporation or has any material equity interest in
any firm, partnership, association or other entity.
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(vi) The Company's authorized equity capitalization is as
set forth in the Prospectuses; the capital stock of the Company
conforms to the description thereof contained in the Prospectuses; the
outstanding Securities (including the offered Securities being sold
hereunder by the Selling Stockholders) have been duly and validly
authorized and issued and are fully paid and nonassessable; the
offered Securities being sold hereunder by the Company have been duly
and validly authorized, and, when issued and delivered to and paid for
by the Underwriters pursuant to this Agreement, will be fully paid and
nonassessable; the Securities being sold hereunder by the Company and
the Selling Stockholders are duly authorized for listing, subject to
official notice of issuance on the Nasdaq National Market; the
certificates for the Securities are in valid and sufficient form; and
the holders of outstanding shares of capital stock of the Company are
not entitled to preemptive or other rights to subscribe for the
Securities.
(vii) This Agreement has been duly authorized, executed and
delivered by the Company.
(viii) Neither the Company nor any of its subsidiaries is in
violation of its respective charter or by-laws (or certificate of
limited partnership or partnership agreement in the case of a
partnership subsidiary) or is in default in the performance of any
obligation, agreement or condition contained in any bond, debenture,
note or any other evidence of indebtedness or in any other agreement,
indenture or instrument material to the conduct of the business of the
Company and its subsidiaries, taken as a whole, to which the Company
or any of its subsidiaries is a party or by which it or any of its
subsidiaries or their respective properties are bound or is in
violation of any existing material law, order, rule or regulation of
any court, governmental agency or body or any arbitrator, domestic or
foreign, having jurisdiction over any of them or any of their
properties.
(ix) The execution, delivery and performance of this
Agreement, compliance by the Company with all the provisions hereof
and the consummation of the transactions contemplated hereby will not
require any consent, approval, authorization or other order of any
court, regulatory body, administrative agency or other governmental
body (except as such may be required under the securities or blue sky
laws of the various states) and will not conflict with or constitute a
breach of any of the terms or provisions of, or a default under, the
charter or by-laws of the Company or the charter or by-laws (or
certificate of limited partnership or partnership agreement in the
case of a partnership subsidiary) of any of its subsidiaries or any
agreement, indenture or other instrument to which the Company or any
of its subsidiaries is a party or by which it or any of its
subsidiaries or their respective properties are bound, or violate or
conflict with any law, order, rule, regulation, judgment, ruling or
decree applicable to the Company, any of its subsidiaries or their
respective property.
(x) Except as disclosed in the Prospectuses, there are no
material arbitration or legal or governmental actions, suits or
proceedings pending to which the Company or any of its subsidiaries is
a party or of which any of their respective property is the subject,
and, to the best of the Company's knowledge, no such arbitrations,
actions, suits or proceedings are threatened or contemplated. No
contract or document of a character required to be described in the
Registration Statement or the Prospectus or to be filed as an exhibit
to the Registration Statement is not so described or filed as
required.
(xi) Neither the Company nor any of its subsidiaries has
violated any foreign, federal, state or local law or regulation
(including, without limitation, laws and regulations related to notice
requirements) relating to the protection of human health and safety,
the environment or hazardous or toxic substances or wastes, pollutants
or contaminants ("Environmental Laws"), nor any federal or state law
relating to discrimination in the hiring, promotion or pay of
employees nor any applicable federal or state wages and hours laws,
nor any provisions of the Employee Retirement Income Security Act of
1974, as amended, or the rules and regulations promulgated thereunder,
which in each case might result in any material adverse change in the
business, prospects, financial condition or results of operation of
the Company and its subsidiaries, taken as a whole. With respect to
Environmental Laws, the Company has reasonably concluded that costs
and liabilities associated with any violations of such laws by the
Company or its subsidiaries would not, singly or in the aggregate,
have a material adverse effect on the Company and its subsidiaries,
taken as a whole.
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(xii) Each of the Company and its subsidiaries has such
permits, certificates, licenses, franchises and authorizations of
governmental or regulatory authorities ("permits"), including, without
limitation, under any applicable Environmental Laws, as are necessary
to own, lease and operate its respective properties and to conduct its
business, except such permits the absence of which would not, singly
or in the aggregate, have a material adverse effect on the Company and
its subsidiaries taken as a whole; the Company and each of its
subsidiaries has fulfilled and performed all of its material
obligations with respect to such permits and no event has occurred
which allows, or after notice or lapse of time would allow, revocation
or termination thereof or results in any other material impairment of
the rights of the holder of any such permit; and, except as described
in the Prospectuses, such permits contain no restrictions that are
materially burdensome to the Company or any of its subsidiaries.
(xiii) Except as otherwise set forth in the Prospectuses or
such as are not material to the business, prospects, financial
condition or results of operation of the Company and its subsidiaries,
taken as a whole, the Company and each of its subsidiaries have good
and valid title (subject to the liens on such assets described in
Appendix 1(a)(xiv) hereto) to all property and assets described in the
Registration Statement as being owned by it, free and clear of all
liens, encumbrances, claims, security interests, subleases and
defects. All leases to which the Company or any of its subsidiaries
is a party are valid, subsisting and enforceable, and no default has
occurred or is continuing thereunder that might result in any material
adverse change in the business, prospects, financial condition or
results of operation of the Company and its subsidiaries, taken as a
whole; and the Company and its subsidiaries enjoy peaceful and
undisturbed possession under all such leases to which any of them is a
party as lessee with such exceptions as do not materially interfere
with the use made and proposed to be made by the Company or such
subsidiary.
(xiv) Each of the Company and its subsidiaries maintain
reasonably adequate insurance in accordance with industry practice;
and all of such insurance is outstanding and duly in force on the
Execution Date and will be outstanding and duly in force on the
Closing Date.
(xv) Xxxxxx Xxxxxxxx LLP are independent public
accountants with respect to the Company as required by the Act and the
Securities and Exchange Act of 1934 (as amended, the "Exchange Act")
and the rules and regulations thereunder.
(xvi) The financial statements, together with related
schedules and notes forming part of the Registration Statement and the
Prospectuses (and any amendment or supplement thereto), present fairly
the consolidated financial position, results of operations and changes
in financial position of the Company and its subsidiaries on the basis
stated in the Registration Statement at the respective dates or for
the respective periods to which they apply; such statements and
related schedules and notes have been prepared in accordance with
generally accepted accounting principles consistently applied
throughout the periods involved, except as disclosed therein; and the
other financial and statistical information and data set forth in the
Registration Statement and the Prospectuses (and any amendment or
supplement thereto) is, in all material respects, accurately presented
and prepared on a basis consistent with such financial statements and
the books and records of the Company.
(xvii) There are no persons with registration or other
similar rights to have any securities registered pursuant to the
Registration Statement or the Act or to participate in the offering of
Securities contemplated by this Agreement, except such as have been
waived in writing or complied with by the inclusion of such securities
in the Registration Statement.
(xviii) The Company and its subsidiaries have complied with
all provisions of Section 1 of Laws of Florida, Chapter 92-198.
(xix) None of the Company or its subsidiaries is (A) an
"investment company" or a company "controlled" by an "investment
company" within the meaning of the Investment Company Act of 1940, as
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amended (the "Investment Company Act"), or analogous foreign laws and
regulations, or (B) a "holding company" or a "subsidiary company" or
an "affiliate" of a holding company within the meaning of the Public
Utility Holding Company Act of 1935, as amended, or analogous foreign
laws and regulations.
(xx) There are no outstanding subscriptions, rights,
warrants, options, calls, convertible securities, commitments of sale
or liens related to or entitling any person to purchase or otherwise
to acquire any shares of the capital stock of, or other ownership
interest in, the Company or any subsidiary thereof except as otherwise
disclosed in the Registration Statement or as disclosed on Appendix
2(a)(xxi) hereto.
(xxi) Except as disclosed in the Prospectus, there are no
business relationships or related party transactions required to be
disclosed therein by Item 404 of Regulation S-K of the Commission.
(xxii) Each of the Company and its subsidiaries maintains 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.
(xxiii) All material tax returns required to be filed by the
Company and each of its subsidiaries in any jurisdiction have been
filed, other than those filings being contested in good faith, and all
material taxes, including withholding taxes, penalties and interest,
assessments, fees and other charges due pursuant to such returns or
pursuant to any assessment received by the Company or any of its
subsidiaries have been paid, other than those being contested in good
faith and for which adequate reserves have been provided.
(xxiv) Subsequent to the respective dates as of which
information is given in the Prospectuses and up to the date and time
this Agreement is executed and delivered by the parties hereto (the
"Execution Time"), except as set forth in the Prospectuses, (i) none
of the Company or any of its subsidiaries has incurred any liabilities
or obligations, direct or contingent, which are material to the
Company and its subsidiaries taken as a whole, nor entered into any
material transaction whether or not in the ordinary course of
business, (ii) there has been no dividend or distribution of any kind
declared, paid or made by the Company on its shares of capital stock,
and (iii) there has not been, singly or in the aggregate, any material
adverse change or any development which may reasonably be expected to
involve a material adverse effect on the Company and its subsidiaries,
taken as a whole.
(xxv) The Company is deemed a citizen of the United States
as determined pursuant to Section 2 of the Shipping Act, 1916, as
amended, and the beneficial ownership of the Company's capital stock
by foreign persons or entities as of the date of the Prospectuses does
not violate the Shipping Act, 1916 or the Company's certificate of
incorporation.
(xxvi) Except as disclosed in the Prospectuses, there are no
contracts, agreements or understandings between the Company, any
Selling Stockholder and any person that would give rise to a valid
claim against the Company or any Underwriter for a brokerage
commission, finders fee or other like payments in connection
with this offering.
(b) Each Selling Stockholder represents and warrants to, and agrees
with, each Underwriter that:
(i) Such Selling Stockholder is the lawful owner of the
Securities to be sold by such Selling Stockholder hereunder, and upon
sale and delivery of, and payment for, such Securities, as provided
herein, such Selling Stockholder will convey good and marketable title
to such Securities, free and clear of all liens, encumbrances,
equities and claims whatsoever.
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(ii) Such Selling Stockholder has no reason to believe
that the representations and warranties of the Company contained in
this Section 2 are not true and correct; and the sale of Securities by
such Selling Stockholder pursuant hereto is not prompted by any
information concerning the Company or any of its subsidiaries which is
not, to such Selling Stockholder's knowledge, publicly available
information.
(iii) Such Selling Stockholder has not taken and will not
take, directly or indirectly, any action designed to or which has
constituted or which 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 offered Securities.
(iv) Upon delivery of payment for the Securities to be
sold by such Selling Stockholder and after delivery of such securities
by such Selling Stockholder, in accordance with this Agreement, good
and clear title to such Securities will pass to the Underwriters, free
of all restrictions on transfers, liens, encumbrances, securities
interests and claims whatsoever.
(v) Such Selling Stockholder has, and on the Closing Date
will have, full legal rights, power and authority to enter into (a)
this Agreement, (b) the Custody Agreement between the Selling
Stockholder and the Company, as Custodian (the "Custody Agreement"),
and (c) the Selling Stockholder's Irrevocable Power of Attorney
appointing Xxxxxx X. Xxxxxxx and Xxxxxx X. Xxxxxx as
attorneys-in-fact for such Selling Stockholder (the "Power of
Attorney"), and to sell, assign, transfer and deliver the Securities
to be sold by such Selling Stockholder in the manner provided herein
and therein, and this Agreement, the Custody Agreement and the Power
of Attorney have been duly authorized, executed and delivered by such
Selling Stockholder and each of this Agreement, the Custody Agreement
and the Power of Attorney is a valid and binding agreement of such
Selling Stockholder enforceable in accordance with its terms, except
as rights to indemnity and contribution hereunder may be limited by
applicable law.
(vi) The execution, delivery and performance of this
Agreement, the Custody Agreement and the Power of Attorney by such
Selling Stockholder, compliance by such Selling Stockholder with all
the provisions hereof and thereof and the consummation of the
transactions contemplated hereby and thereby will not require any
consent, approval, authorization or other order of any court,
regulatory body, administrative agency or other governmental body
(except as such may be required under the Act, state securities laws
or blue sky laws) and will not conflict with or constitute a breach of
any of the terms or provisions of, or a default under, organizational
documents of such Selling Stockholder, if not an individual, or any
agreement, indenture or other instrument to which such Selling
Stockholder is a party or by which such Selling Stockholder or
property of such Selling Stockholder is bound, or violate or conflict
with any laws, administrative regulation or ruling or court decree
applicable to such Selling Stockholder or property of such Selling
Stockholder.
(vii) The information contained in the Prospectuses
specifically relating to such Selling Stockholder does not, and will
not on the Closing Date (and any Option Closing Date, if applicable),
contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the
statements therein, in light of circumstances under which they were
made, not misleading.
(viii) Except as disclosed in the Prospectuses, there are no
contracts, agreements or understandings between the Company, any
Selling Stockholder and any person that would give rise to a valid
claim against the Company or any Underwriter for a brokerage
commission, finders fee or other like payments in connection
with this offering.
3. Purchase, Sale and Delivery of Offered Securities. On the
basis of the representations, warranties and agreements herein contained, but
subject to the terms and conditions herein set forth, the Company and each
Selling Stockholder agrees to sell to the Underwriters, and the Underwriters
agree, severally and not jointly, to purchase from
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the Company, at a purchase price of U.S.$ per share the respective
numbers of U.S. Firm Securities set forth opposite the names of the
Underwriters in Schedule A hereto.
The Company and each Selling Stockholder will deliver the U.S. Firm
Securities to the Representatives for the accounts of the Underwriters, at the
office of , against payment of the purchase price in
immediately available funds drawn to the order of at
the office of , at A.M., New York time, on ,
or at such other time not later than seven full business days thereafter
as CS First Boston Corporation ("CSFBC") and the Company determine, (such time
being herein referred to as the "First Closing Date"). For purposes of Rule
15c6-1 under the Exchange Act, the First Closing Date (if later than the
otherwise applicable settlement date) shall be the settlement date for payment
of funds and delivery of securities for all the Offered Securities sold
pursuant to the U.S. Offering and the International Offering. The certificates
for the U.S. Firm Securities so to be delivered will be in definitive form, in
such denominations and registered in such names as CSFBC requests and will be
made available for checking and packaging at the above office of ,
at least 24 hours prior to the First Closing Date.
In addition, upon written notice from CSFBC given to the Company from
time to time not more than 30 days subsequent to the date of the Prospectuses,
the Underwriters may purchase all or less than all of the U.S. Optional
Securities at the purchase price per Security to be paid for the U.S. Firm
Securities. The U.S. Optional Securities to be purchased by the Underwriters
on any Optional Closing Date shall be in the same proportion to all the
Optional Securities to be purchased by the Underwriters and the Managers on
such Optional Closing Date as the U.S. Firm Securities bear to all the Firm
Securities. The Company and each Selling Stockholder agree to sell to the
Underwriters such U.S. Optional Securities and the Underwriters agree,
severally and not jointly, to purchase such U.S. Optional Securities. Such
U.S. Optional Securities shall be purchased for the account of each Underwriter
in the same proportion as the number of shares of U.S. Firm Securities set
forth opposite such Underwriter's name bears to the total number of shares of
U.S. Firm Securities (subject to adjustment by CSFBC to eliminate fractions)
and may be purchased by the Underwriters only for the purpose of covering
over-allotments made in connection with the sale of the U.S. Firm Securities.
No Optional Securities shall be sold or delivered unless the U.S. Firm
Securities and the International Firm Securities previously have been, or
simultaneously are, sold and delivered. The right to purchase the Optional
Securities or any portion thereof may be exercised from time to time and to the
extent not previously exercised may be surrendered and terminated at any time
upon notice by CSFBC on behalf of Underwriters and the Managers to the Company.
It is understood that CSFBC is authorized to make payment for and accept
delivery of such Optional Securities on behalf of the Underwriters and Managers
pursuant to the terms of CSFBC's instructions to the Company.
Each time for the delivery of and payment for the U.S. Optional
Securities, being herein referred to as an "Optional Closing Date", which may
be the First Closing Date (the First Closing Date and each Optional Closing
Date, if any, being sometimes referred to as a "Closing Date"), shall be
determined by CSFBC but shall be not later than five full business days after
written notice of election to purchase Optional Securities is given. The
Company and each Selling Stockholder will deliver the U.S. Optional Securities
being purchased on each Optional Closing Date to the Representatives for the
accounts of the several Underwriters, at the office of ,
against payment of the purchase price in immediately available funds drawn to
the order of , at the above office of
. The certificates for the U.S. Optional Securities will be in
definitive form, in such denominations and registered in such names as CSFBC
requests upon reasonable notice prior to such Optional Closing Date and will be
made available for checking and packaging at the above office of ,
at a reasonable time in advance of such Optional Closing Date.
4. Offering by Underwriters. It is understood that the several
Underwriters propose to offer the U.S. Securities for sale to the public as
set forth in the U.S. Prospectus.
5. Certain Agreements of the Company and the Selling
Stockholders. The Company agrees with the several Underwriters and the Selling
Stockholders that:
(i) 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
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offering of the Securities, the Company will not file any amendment of
the Registration Statement or supplement to the Prospectuses 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 object. Subject to the foregoing sentence, if the Registration
Statement has become or becomes effective pursuant to Rule 430A, or
filing of the Prospectuses is otherwise required under Rule 424(b),
the Company will cause the Prospectuses, 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
(A) when the Registration Statement, if not effective at the Execution
Time, and any amendment thereto, shall have become effective, (B) when
the Prospectuses, and any supplement thereto, shall have been filed
(if required) with the Commission pursuant to Rule 424(b), (C) when,
prior to termination of the offering of the Securities, any amendment
to the Registration Statement shall have been filed or become
effective, (D) of any request by the Commission for any amendment of
the Registration Statement or supplement to the Prospectuses or for
any additional information, (E) 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 (F) 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 initiation or threatening of any
proceeding for such purpose. The Company will use its best efforts to
prevent the issuance of any such stop order and, if issued, to obtain
as soon as possible the withdrawal thereof.
(ii) 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 Exchange Act or the
respective rules thereunder, the Company promptly will (x) prepare and
file with the Commission, subject to the second sentence of paragraph
(a) of this Section 5, an amendment or supplement which will correct
such statement or omission or effect such compliance and (y) supply
any supplemented Prospectuses to you in such quantities as you may
reasonably request. Neither CSFBC's consent nor the Underwriter's
deliver of such amendment or supplement shall constitute a waiver of
any of the conditions set forth in Section 6 hereof.
(iii) As soon as practicable, the Company will make
generally available to its security holders and to the Representatives
and will file with the Commission 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.
(iv) The Company will furnish to the Representatives and
counsel for the Underwriters, without charge, 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 Prospectus
and any supplement thereto as the Representatives may reasonably
request. The Company will pay the expenses of printing or other
production of all documents relating to the offering.
(v) The Company will arrange for the qualification of the
Securities for sale under the laws of such jurisdictions as the
Representatives may designate, will maintain such qualifications in
effect so long as required for the distribution of the Securities;
provided, however, that the Company will not be obligated to qualify
as a foreign corporation in any jurisdiction in which it is not
qualified. The Company will pay the fee of the National Association
of Securities Dealers, Inc., in connection with its review of the
offering.
(vi) The Company and the Selling Stockholders will not,
for a period of 180 days and 90 days, respectively, following the
Execution Time, without the prior written consent of CSFBC, offer,
sell or contract to sell, or otherwise dispose of, directly or
indirectly, or announce the offering of, any Securities or any
securities convertible into, or exchangeable for, Securities
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other than the sale of Securities to the Underwriters pursuant to this
Agreement; provided, however, that the Company may issue and sell
Securities pursuant to any employee stock option plan, stock ownership
plan or dividend reinvestment plan of the Company in effect at the
Execution Time and the Company may issue Securities upon the conversion
of securities or the exercise of warrants or options outstanding at the
Execution Time; and provided further, that the Company may issue
Securities, pursuant to the Company's agreement to acquire the drillships
Deepsea Ice and Deepsea Duchess, the aggregate market value of which
shall not exceed $15 million based on the average closing price of the
Securities on the Nasdaq Stock Market for the five trading days prior
to the date of the closing of such acquisition.
(vii) Each Selling Stockholder will deliver to CSFBC, attention:
Transactions Advisory Group on or prior to the First Closing Date a
properly completed and executed United States Treasury Department Form
W-9 (or other applicable form or statement specified by Treasury
Department regulations in lieu thereof).
6. Conditions of the Obligations of the Underwriters. The
obligations of the several Underwriters to purchase and pay for the U.S. Firm
Securities on the First Closing Date and the U.S. Optional Securities to be
purchased on each Optional Closing Date will be subject to the accuracy of the
representations and warranties on the part of the Company and the Selling
Stockholders herein, to the accuracy of the statements of Company officers made
pursuant to the provisions hereof, to the performance by the Company and the
Selling Stockholders of its obligations hereunder and to the following
additional conditions precedent:
(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) 12:00 Noon 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 Prospectuses 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; if filing of an additional
registration statement or a post-effective amendment to the Registration
Statement shall be made pursuant to Rule 462(b) under the Act, such filing
shall occur in the manner provided in Rule 462.
(b) The Company shall have furnished to the Representatives the
opinion of Xxxxxx & Xxxxx, counsel for the Company and certain of the Selling
Stockholders, dated the Closing Date, to the effect that;
(i) The Company and each of its subsidiaries has been duly
incorporated (or formed in the case of a partnership subsidiary), is
validly existing as a corporation or partnership, as the case may be, in
good standing under the laws of its jurisdiction of incorporation or
formation and has the corporate or partnership power and authority
required to carry on its business as described in the Prospectuses and
to own, lease and operate its properties, and is duly qualified to do
business as a foreign corporation or partnership, as the case may be,
and is in good standing under the laws of each jurisdiction which
requires such qualification wherein it owns or leases material
properties or conducts material business;
(ii) All of the outstanding shares of capital stock of, or
other ownership interests in, each of the Company's subsidiaries have
been duly and validly authorized and issued and are fully paid and
non-assessable and are owned by the Company either directly or through
wholly owned subsidiaries free and clear of any perfected security
interest and, to the knowledge of such counsel, after due inquiry, any
other security interest, claim, lien or encumbrance;
(iii) The Company's authorized equity capitalization is as set
forth in the Prospectuses; the capital stock of the Company conforms to
the description thereof contained in the Prospectuses; the outstanding
shares of Securities (including the Securities to be sold by each of the
Selling Stockholders) have been duly authorized and validly issued and
are fully paid, non-assessable and not subject to any preemptive or
similar rights; the Securities to be issued and sold by the Company
hereunder have been duly authorized and, when issued and delivered to
the Underwriters against payment therefor as provided by this Agreement,
will be fully paid and
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non-assessable, and the issuance of such Securities is not subject to
any preemptive or similar rights; and the certificates for the
Securities are in valid and sufficient form;
(iv) This Agreement has been duly authorized, executed and
delivered by the Company and each of the Selling Stockholders and is a
valid and binding agreement of the Company and each of the Selling
Stockholders, enforceable in accordance with its terms (except as rights
to indemnity and contribution hereunder may be limited by applicable
law);
(v) The statements under the captions "Risk Factors -
Environmental Matters," "Risk Factors - Restrictions on Foreign
Ownership," and "Selling Stockholders" in the Prospectuses and in Item
15 of Part II of the Registration Statement, insofar as such statements
constitute a summary of legal matters, regulations, documents or
proceedings referred to therein, provide a fair summary of such legal
matters, regulations, documents and proceedings;
(vi) The execution, delivery and performance of this Agreement
by the Company and each Selling Stockholder, compliance by the Company
and each Selling Stockholder with the provisions hereof and the
consummation of the transactions contemplated hereby do not require any
consent, approval, authorization or other order of any court, regulatory
body, administrative agency or other governmental body (except as such
may be required under the Act or other securities or blue sky laws) and
do not constitute a breach of any of the terms or provisions of, or a
default under, the charter or by-laws or certificate or agreement of
limited partnership, as the case may be, of the Company or any of its
subsidiaries or any of the organizational documents of any of the
Selling Stockholders or any agreement, indenture or other instrument
known to us to which the Company or any of its subsidiaries or any of
the Selling Stockholders is a party or by which the Company or any of
its subsidiaries or any of the Selling Stockholders or their respective
properties are bound, or violate or conflict with any laws,
administrative regulations or rulings or court decrees known to us to be
applicable to the Company or any of its subsidiaries or any of the
Selling Stockholders or any of their respective properties;
(vii) Such counsel does not know of any legal or governmental
action, suit or proceeding pending or threatened before any court or
governmental agency, authority or body or any arbitrator to which the
Company or any of its subsidiaries is a party or to which any of their
respective property is subject which is required to be described in the
Registration Statement or the Prospectuses and is not so described, or
of any contract or other document which is required to be described in
the Registration Statement or the Prospectuses or to be filed as an
exhibit to the Registration Statement and is not so described or filed
as required;
(viii) None of the Company or its subsidiaries is (A) an
"investment company" or a company "controlled" by an "investment
company" within the meaning of the Investment Company Act of 1940, as
amended (the "Investment Company Act") or (B) a "holding company" or a
"subsidiary company" or an "affiliate" of a holding company within the
meaning of the Public Utility Holding Company Act of 1935, as amended;
(ix) (1) the Registration Statement and the Prospectuses and
any supplement or amendment thereto (except for financial statements as
to which no opinion need be expressed) comply as to form in all material
respects with the Act and the Exchange Act and the respective rules
thereunder, and (2) nothing has come to the attention of such counsel
that causes such counsel to believe that (except for financial
statements, as aforesaid) the Registration Statement and the
prospectuses included therein at the time the Registration Statement
became effective contained any untrue statement of a material fact or
omitted to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, or that the
Prospectuses as of the Closing Date, as amended or supplemented, if
applicable (except for financial statements, as aforesaid) contains any
untrue statement of a material fact or omits 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;
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(x) A Custody Agreement and a Power of Attorney have each been
duly authorized, executed and delivered by each Selling Stockholder and
are each a valid and binding agreement of each Selling Stockholder
enforceable in accordance with its terms;
(xi) Each of the Selling Stockholders has received any approval
required by law (other than any approval imposed by the applicable state
securities and blue sky laws) to sell, assign, transfer and deliver the
Securities to be sold by it in the manner provided in this Agreement,
the Custody Agreement and the Power of Attorney, and each of the Selling
Stockholders that is a corporation or partnership has full corporate or
partnership power and authority, as the case may be, to so sell, assign,
transfer and deliver the Securities;
(xii) To such counsel's knowledge, there are no persons with
registration or other similar rights to have any securities registered
pursuant to the Registration Statement or under the Act or to
participate in the offering of the Securities contemplated by this
Agreement, except such as have been waived or complied with by inclusion
of such persons as Selling Stockholders in the Registration Statement;
(xiii) Each of the Selling Stockholders has good and clear title
to the certificates for the Securities to be sold by it and assuming
that the Underwriters acquired their interest in the Securities in good
faith and without notice of any adverse claim, and upon delivery
thereof, pursuant hereto and payment therefor, good and clear title will
pass to the Underwriters, severally, free of all restrictions on
transfers, liens, encumbrances, security interests and claims
whatsoever;
(xiv) The Company is deemed a citizen of the United States as
determined pursuant to Section 2 of the Shipping Act, 1916, as amended,
and the beneficial ownership of the Company's capital stock by foreign
persons or entities as of the date of the Prospectuses does not violate
the Shipping Act, 1916 or the Company's certificate of incorporation.
In giving such opinion with respect to matters covered by clause (ix), such
counsel may state that their belief is based upon their participation in the
preparation of the Registration Statement and the Prospectuses and review and
discussion of the contents thereof, but is without independent check or
verification. In rendering such opinion, such counsel may rely as to matters
of fact, to the extent they deem proper, on certificates of responsible
officers of the Company and the Selling Stockholders and public officials.
References to the Registration Statement and Prospectuses in this paragraph (b)
include any amendments or supplements thereto at the Closing Date.
(c) The Representatives shall have received from ,
counsel to certain of the Selling Stockholders, an opinion with respect to
such Stockholders covering the matters described in paragraphs (b)(vi), (x),
(xi) and (xiii) above.
(d) The Representatives shall have received from Xxxxxxx & Xxxxx
L.L.P., counsel for the Underwriters, such opinion or opinions, dated the
Closing Date, with respect to the issuance and sale of the Securities, the
Registration Statement, the Prospectuses (together with any supplement thereto)
and other related matters as the Representatives may reasonably require, and
the Company and each Selling Stockholder shall have furnished to such counsel
such documents as they request for the purpose of enabling them to pass upon
such matters.
(e) 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 financial or accounting officer of the Company,
dated the Closing Date, to the effect that such officers have carefully
examined the Registration Statement, the Prospectuses, any supplements to the
Prospectuses and this Agreement and that:
(i) The representations and warranties of the Company in this
Agreement are true and correct in all material respects 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;
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(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 Prospectuses, there has been no material adverse change
in the condition (financial or other), earnings, business, properties or
prospects of the Company and its subsidiaries, whether or not arising
from transactions in the ordinary course of business, except as set
forth in or contemplated in the Prospectuses.
(f) Each Selling Stockholder shall have furnished to the
Representatives a certificate, signed by or on behalf of such Selling
Stockholder dated the Closing Date, to the effect that the signer of such
certificate has carefully examined the Registration Statement, the
Prospectuses, any supplement to the Prospectuses and this Agreement and that
the representations and warranties of such Selling Stockholder in this
Agreement are true and correct in all material respects on and as of the
Closing Date to the same effect as if made on the Closing Date.
(g) At the Execution Time and at the Closing Date, Xxxxxx Xxxxxxxx
LLP shall have furnished to the Representatives a letter or letters, dated
respectively as of the Execution Time and as of the Closing Date, in form and
substance satisfactory to the Representatives, confirming that they are
independent accountants within the meaning of the Act and the Exchange Act and
the respective applicable published rules and regulations thereunder and
stating in effect that:
(i) in their opinion the audited financial statements and
financial statement schedules included and incorporated by reference in
the Registration Statement and the Prospectuses and reported on by them
comply in form in all material respects with the applicable accounting
requirements of the Act and the Exchange Act and the related published
rules and regulations;
(ii) on the basis of a reading of the latest unaudited
financial statements made available by the Company and its subsidiaries;
carrying out certain specified procedures as described in Statement on
Auditing Standards No. 71 (but not an audit in accordance with generally
accepted auditing standards); a reading of the minutes of the meetings
of the stockholders, directors and committees of the Company and its
subsidiaries; and inquiries of certain officials of the Company who have
responsibility for financial and accounting matters of the Company and
its subsidiaries as to transactions and events subsequent to December
31, 1995, nothing came to their attention which caused them to believe
that:
(1) any unaudited financial statements included or
incorporated by reference in the Registration Statement and the
Prospectuses do not comply in form in all material respects with
applicable accounting requirements of the Act and the Exchange
Act and with the published rules and regulations of the
Commission with respect to registration statements on Form S-3;
and said unaudited financial statements are not in conformity
with generally accepted accounting principles applied on a basis
substantially consistent with that of the audited financial
statements included or incorporated by reference in the
Registration Statement and the Prospectuses; or
(2) with respect to the period subsequent to September
30, 1996, there were any changes, at a specified date not more
than two business days prior to the date of the letter, in the
long-term debt and other obligations of the Company and its
subsidiaries or capital stock of the Company, decreases in the
stockholders' equity of the Company, decreases in working capital
of the Company and its subsidiaries as compared with the amounts
shown on the September 30, 1996 consolidated balance sheet
included and incorporated by reference in the Registration
Statement and the Prospectus, or for the period from September
30, 1996 to such specified date there were any decreases, as
compared with the corresponding period in the preceding year in
operating revenues or income before income taxes and minority
interest or preferred stock dividends and accretion or in total
or per share amounts of net income of the Company and its
subsidiaries, except in all instances for changes or decreases
set forth in such letter, in which case
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the letter shall be accompanied by an explanation by the Company
as to the significance thereof unless said explanation is not
deemed necessary by the Representatives;
(iii) they have performed certain other specified procedures as
a result of which they determined that certain information of an
accounting, financial or statistical nature set forth in the
Registration Statement and the Prospectuses, including the information
set forth under the captions "Prospectus Summary," "Capitalization,"
"Selected Historical Financial Data," "Management's Discussion and
Analysis of Financial Condition and Results of Operations" and
"Business" in the Prospectuses, and the information included or
incorporated by reference in the Company's Annual Report on Form 10-K,
incorporated by reference in the Registration Statement and the
Prospectuses, and the information included in "Management's Discussion
and Analysis of Financial Condition and Results of Operations" included
in the Company's quarterly reports on Form 10-Q, incorporated by
reference in the Registration Statement and Prospectuses, in each case
agrees with the accounting records of the Company and its subsidiaries,
excluding any questions of legal interpretation; or
(iv) on the basis of a reading of the unaudited pro forma
financial statements included or incorporated in the Registration
Statement and the Prospectuses (the "pro forma financial statements");
carrying out certain specified procedures; inquiries of certain
officials of the Company and of the acquired entities named in such pro
forma financial statements who have responsibilities for financial and
accounting matters; and proving the arithmetic accuracy of the
application of the pro forma adjustments to the historical amounts in
the pro forma financial statements, nothing came to their attention
which caused them to believe that the pro forma financial statements do
not comply in form in all material respects with the applicable
accounting requirements of Rule 11-02 of Regulation S-X or that the pro
forma adjustments have not been properly applied to the historical
amounts in the compilation of such statements.
References to the Prospectuses in this paragraph (g) include any supplement
thereto at the date of the letter.
(h) Subsequent to the execution and delivery of this Agreement,
there shall not have occurred (i) any change, or any development or event
involving a prospective change, in the condition (financial or other),
business, properties or results of operations of the Company or its
subsidiaries which, in the judgment of a majority in interest of the
Underwriters including the Representatives, is material and adverse and makes
it impractical or inadvisable to proceed with completion of the public offering
or the sale of and payment for the Offered Securities; (ii) any downgrading in
the rating of any debt securities of the Company by any "nationally recognized
statistical rating organization" (as defined for purposes of Rule 436(g) under
the Act), or any public announcement that any such organization has under
surveillance or review its rating of any debt securities of the Company (other
than an announcement with positive implications of a possible upgrading, and no
implication of a possible downgrading, of such rating); (iii) any suspension or
limitation of trading in securities generally on the New York Stock Exchange,
or any setting of minimum prices for trading on such exchange, or any
suspension of trading of any securities of the Company on any exchange or in
the over-the-counter market; (iv) any banking moratorium declared by U.S.
Federal or New York authorities; or (v) any outbreak or escalation of major
hostilities in which the United States is involved, any declaration of war by
Congress or any other substantial national or international calamity or
emergency if, in the judgment of a majority in interest of the Underwriters
including the Representatives, the effect of any such outbreak, escalation,
declaration, calamity or emergency makes it impractical or inadvisable to
proceed with completion of the public offering or the sale of and payment for
the Offered Securities.
(i) At the Execution Time, the Company shall have furnished to the
Representatives a letter substantially in the form of Exhibit A hereto from
S-C Rig Investments, L.P., its partners and affiliates, addressed to the
Representatives, in which each such person agrees not to offer, sell or
contract to sell, or otherwise dispose of, directly or indirectly, or
announce an offering of, any Securities beneficially owned by such person
or any securities convertible into, or exchangeable for, Securities for
a period of 180 days following the Execution Time without the prior written
consent of CSFBC.
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(j) Prior to the Closing Date, the Company and each Selling
Stockholder 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 in all material respects 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 in all material respects 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 each Selling Stockholder in
writing or by telephone or telegraph confirmed in writing.
The documents required to be delivered by this Section 6 shall be delivered at
the office of Xxxxxx & Xxxxx, counsel for the Company, in New York, New York,
on the Closing Date.
7. Indemnification and Contribution. (a) The Company will
indemnify and hold harmless each Underwriter against any losses, claims,
damages or liabilities, joint or several, to which such Underwriter may become
subject, under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon any
untrue statement or alleged untrue statement of any material fact contained in
any Registration Statement, either of the Prospectuses, or any amendment or
supplement thereto, or any related preliminary prospectus, or arise out of or
are based upon the omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements therein
not misleading, and will reimburse each Underwriter for any legal or other
expenses reasonably incurred by such Underwriter in connection with
investigating or defending any such loss, claim, damage, liability or action as
such expenses are incurred; provided, however, that 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 an untrue statement or alleged untrue
statement in or omission or alleged omission from any of such documents in
reliance upon and in conformity with written information furnished to the
Company by any Underwriter through the Representatives specifically for use
therein, it being understood and agreed that the only information furnished by
any Underwriter consists of the information described as such in subsection (c)
below.
(b) Each Selling Stockholder agrees to indemnify and hold harmless
each Underwriter and each person, if any, who controls any Underwriter within
the meaning of Section 15 of the Act or Section 20 of the Exchange Act, from and
against any and all losses, claims, damages, liabilities and judgments caused by
any untrue statement or alleged untrue statement of a material fact contained or
incorporated in the Registration Statement or the Prospectuses (as amended or
supplemented) or any preliminary prospectus or caused by any omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, but only with
reference to information specifically relating to each Selling Stockholder.
Notwithstanding the foregoing, the aggregate liability of each Selling
Stockholder pursuant to the provisions of this paragraph shall be limited to an
amount equal to the aggregate purchase price received by each Selling
Stockholder from the sale of each Selling Stockholder's Securities and any
Optional Securities sold by each Selling Stockholder hereunder.
(c) Each Underwriter will severally and not jointly indemnify and
hold harmless the Company and each Selling Stockholder against any losses,
claims, damages or liabilities to which the Company and each Selling
Stockholder may become subject, under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise
out of or are based upon any untrue statement or alleged untrue statement of
any material fact contained in any Registration Statement, either of the
Prospectuses, or any amendment or supplement thereto, or any related
preliminary prospectus, or arise out of or are based upon the omission or the
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, in each case to the
extent, but only to the extent, that such untrue statement or alleged untrue
statement or omission or alleged omission was made in reliance upon and in
conformity with written information furnished to the Company by such
Underwriter through the Representatives specifically for use therein, and will
reimburse any legal or other expenses reasonably
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incurred by the Company in connection with investigating or defending any such
loss, claim, damage, liability or action as such expenses are incurred, it
being understood and agreed that the only such information furnished by any
Underwriter consists of (i) the following information in the U.S. Prospectus
furnished on behalf of each Underwriter: the last paragraph at the bottom of
the cover page concerning the terms of the offering by the Underwriters, the
legend concerning over-allotments, stabilizing and passive market making on the
inside front cover page, the concession and reallowance figures appearing in
the fifth paragraph under the caption "Underwriting" and the information
contained in the twelfth paragraph under the caption "Underwriting" and (ii)
the following information in the U.S. Prospectus furnished on behalf of
Xxxxxxxxx, Lufkin & Xxxxxxxx Securities Corporation, Salomon Brothers Inc and
Xxxxxxx & Company International concerning the receipt of fees in prior
offerings in the eleventh paragraph under the caption "Underwriting."
(d) Promptly after receipt by an indemnified party under this Section
of notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against the indemnifying party under
subsection (a), (b) or (c) above, notify the indemnifying party of the
commencement thereof; but the omission so to notify the indemnifying party will
not relieve it from any liability which it may have to any indemnified party
otherwise than under subsection (a), (b) or (c) above. In case any such action
is brought against any indemnified party and it notifies the indemnifying party
of the commencement thereof, the indemnifying party will be entitled to
participate therein and, to the extent that it may wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof, with
counsel satisfactory to such indemnified party (who shall not, except with the
consent of the indemnified party, be counsel to the indemnifying party), and
after notice from the indemnifying party to such indemnified party of its
election so to assume the defense thereof, the indemnifying party will not be
liable to such indemnified party under this Section for any legal or other
expenses subsequently incurred by such indemnified party in connection with the
defense thereof other than reasonable costs of investigation. No indemnifying
party shall, without the prior written consent of the indemnified party, effect
any settlement of any pending or threatened action in respect of which any
indemnified party is or could have been a party and indemnity could have been
sought hereunder by such indemnified party unless such settlement includes an
unconditional release of such indemnified party from all liability on any
claims that are the subject matter of such action.
(e) If the indemnification provided for in this Section is
unavailable or insufficient to hold harmless an indemnified party under
subsection (a), (b) or (c) above, then each indemnifying party shall contribute
to the amount paid or payable by such indemnified party as a result of the
losses, claims, damages or liabilities referred to in subsection (a), (b) or
(c) above (i) in such proportion as is appropriate to reflect the relative
benefits received by the Company and the Selling Stockholders on the one hand
and the Underwriters on the other from the offering of the U.S. Securities or
(ii) if the allocation provided by clause (i) above is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) above but also the relative fault
of the Company and the Selling Stockholders on the one hand and the
Underwriters on the other in connection with the statements or omissions which
resulted in such losses, claims, damages or liabilities as well as any other
relevant equitable considerations. The relative benefits received by the
Company on the one hand and the Underwriters on the other shall be deemed to be
in the same proportion as the total net proceeds from the offering of the U.S.
Securities (before deducting expenses) received by the Company and the Selling
Stockholders bear to the total underwriting discounts and commissions received
by the Underwriters. The relative fault shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company, the Selling Stockholders or the
Underwriters and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such untrue statement or omission. The
amount paid by an indemnified party as a result of the losses, claims, damages
or liabilities referred to in the first sentence of this subsection (e) shall
be deemed to include any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any action or
claim which is the subject of this subsection (e). Notwithstanding the
provisions of this subsection (e), no Underwriter shall be required to
contribute any amount in excess of the amount by which the total price at which
the U.S. Securities underwritten by it and distributed to the public were
offered to the public exceeds the amount of any damages which such Underwriter
has otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from
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any person who was not guilty of such fraudulent misrepresentation. The
Underwriters' obligations in this subsection (e) to contribute are several in
proportion to their respective underwriting obligations and not joint.
(f) The obligations of the Company and the Selling Stockholders under
this Section shall be in addition to any liability which the Company and the
Selling Stockholders may otherwise have and shall extend, upon the same terms
and conditions, to each person, if any, who controls any Underwriter within the
meaning of the Act; and the obligations of the Underwriters under this Section
shall be in addition to any liability which the respective Underwriters may
otherwise have and shall extend, upon the same terms and conditions, to each
director of the Company, to each officer of the Company who has signed a
Registration Statement and to each person, if any, who controls the Company
within the meaning of the Act.
8. Default of Underwriters. If any Underwriter or Underwriters
default in their obligations to purchase U.S. Securities hereunder on either
the First or any Optional Closing Date and the aggregate number of shares of
U.S. Securities that such defaulting Underwriter or Underwriters agreed but
failed to purchase does not exceed 10% of the total number of shares of U.S.
Securities that the Underwriters are obligated to purchase on such Closing
Date, CSFBC may make arrangements satisfactory to the Company and the Selling
Stockholders for the purchase of such U.S. Securities by other persons,
including any of the Underwriters, but if no such arrangements are made by such
Closing Date the non-defaulting Underwriters shall be obligated severally, in
proportion to their respective commitments hereunder, to purchase the U.S.
Securities that such defaulting Underwriters agreed but failed to purchase on
such Closing Date. If any Underwriter or Underwriters so default and the
aggregate number of shares of U.S. Securities with respect to which such
default or defaults occur exceeds 10% of the aggregate amount of U.S.
Securities that the Underwriters are obligated to purchase on such Closing Date
and arrangements satisfactory to CSFBC and the Company for the purchase of such
U.S. Securities by other persons are not made within 36 hours after such
default, this Agreement will terminate without liability on the part of any
non-defaulting Underwriter or the Company, except as provided in Section 9
(provided that if such default occurs with respect to U.S. Optional Securities
after the First Closing Date, this Agreement will not terminate as to the U.S.
Firm Securities or any U.S. Optional Securities purchased prior to such
termination). As used in this Agreement, the term "Underwriter" includes any
person substituted for an Underwriter under this Section. Nothing herein will
relieve a defaulting Underwriter from liability for its default.
9. Survival of Certain Representations and Obligations. The
respective indemnities, agreements, representations, warranties and other
statements of the Selling Stockholders, of the Company or its officers and of
the several Underwriters set forth in or made pursuant to this Agreement will
remain in full force and effect, regardless of any investigation, or statement
as to the results thereof, made by or on behalf of any Underwriter, any Selling
Stockholder, the Company or any of their respective representatives, officers
or directors or any controlling person, and will survive delivery of and
payment for the U.S. Securities. If this Agreement is terminated pursuant to
Section 8 or if for any reason the purchase of the U.S. Securities by the
Underwriters is not consummated, the Company and the Selling Stockholders shall
remain responsible for the expenses to be paid or reimbursed by it pursuant to
Section 5 and the respective obligations of the Company, the Selling
Stockholders and the Underwriters pursuant to Section 7 shall remain in effect
and if any U.S. Securities have been purchased hereunder the representations
and warranties in Section 2 and all obligations under Section 5 shall also
remain in effect. If the purchase of the U.S. Securities by the Underwriters
is not consummated for any reason other than solely because of the termination
of this Agreement pursuant to Section 8 or the occurrence of any event
specified in clause (iii), (iv), or (v) of Section 6(h), the Company and the
Selling Stockholders will reimburse the Underwriters for all out-of-pocket
expenses (including fees and disbursements of counsel) reasonably incurred by
them in connection with the offering of the U.S. Securities.
10. Notices. All communications hereunder will be in writing and, if
sent to the Underwriters, will be mailed, delivered or telegraphed and
confirmed to the Representatives c/o CS First Boston Corporation, Park Avenue
Plaza, New York, N.Y. 10055, Attention: Transactions Advisory Group, or, if
sent to the Company, will be mailed, delivered or telegraphed and confirmed to
it at 0000 Xxxx Xxxx Xxxxx, Xxxxx 0000, Xxxxxxx, Xxxxx 00000, Attention: Xxxxxx
X. Xxxxxxx, or, if sent to the Selling Stockholders or any of them, will be
mailed, delivered or telegraphed and confirmed c/o the Company, 0000 Xxxx Xxxx
Xxxxx, Xxxxx 0000, Xxxxxxx, Xxxxx 00000, Attention: Xxxxxx X. Xxxxxxx;
provided,
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however, that any notice to an Underwriter pursuant to Section 7 will be
mailed, delivered or telegraphed and confirmed to such Underwriter.
11. Successors. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective personal representatives
and successors and the officers and directors and controlling persons referred
to in Section 7, and no other person will have any right or obligation
hereunder.
12. Representation of Underwriters and Selling Stockholders. The
Representatives will act for the several Underwriters in connection with the
transactions contemplated by this Agreement, and any action under this
Agreement taken by the Representatives jointly or by CSFBC will be binding upon
all the Underwriters. Xxxxxx X. Xxxxxxx and Xxxxxx X. Xxxxxx will act for the
Selling Stockholders pursuant to the Powers of Attorney granted by the Selling
Stockholders in connection with such transactions, and any action under or in
respect of this Agreement taken by Messrs. Xxxxxxx and Xxxxxx will be binding
upon all the Selling Stockholders.
13. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such
counterparts shall together constitute one and the same Agreement.
14. APPLICABLE LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD
TO PRINCIPLES OF CONFLICTS OF LAWS.
The Company hereby submits to the non-exclusive jurisdiction of the
Federal and state courts in the Borough of Manhattan in The City of New York in
any suit or proceeding arising out of or relating to this Agreement or the
transactions contemplated hereby.
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If the foregoing is in accordance with the Representatives'
understanding of our agreement, kindly sign and return to the Company one of
the counterparts hereof, whereupon it will become a binding agreement among the
Company, the Selling Stockholders and the several Underwriters in accordance
with its terms.
Very truly yours,
FALCON DRILLING COMPANY, INC.
By:
--------------------------------------
Xxxxxx X. Xxxxxxx
Chairman and Chief Executive Officer
THE SELLING STOCKHOLDERS
NAMED IN SCHEDULE B HERETO
By:
--------------------------------------
Attorney-in-Fact
The foregoing Underwriting Agreement is hereby confirmed
and accepted as of the date first above written.
CS FIRST BOSTON CORPORATION
Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities Corporation
Salomon Brothers Inc
Xxxxxxxx Xxxxxxxx & Co.
Xxxxxxx & Company International
Acting on behalf of themselves and as the Representatives
of the several Underwriters.
By CS FIRST BOSTON CORPORATION
By:
---------------------------------
Name:
-------------------------------
Title:
------------------------------
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SCHEDULE A
Number of
Underwriter U.S. Firm Securities
----------- --------------------
CS First Boston Corporation . . . . . . . . . . . . . . . . . . . . . . . . .
Xxxxxxxxx, Lufkin & Xxxxxxxx Securities Corporation . . . . . . . . . . . . .
Salomon Brothers Inc . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Xxxxxxxx Xxxxxxxx & Co. . . . . . . . . . . . . . . . . . . . . . . . . . . .
Xxxxxxx & Company International . . . . . . . . . . . . . . . . . . . . . . .
--------------------
Total . . . . . . . . . . . . . . . . . . . . . . .
====================
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SCHEDULE B
Number of U.S. Firm
Securities
Selling Stockholder to be Sold
------------------- ----------
-----------------
Total . . . . . . . . . . . . . . . . . . . . . . .
=================
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SCHEDULE C
Maximum Number of
Optional Shares
Seller to be Sold
------ ----------
Falcon Drilling Company, Inc. . . . . . . . . . . . . . . . . . . . . .
---------------------------
Total . . . . . . . . . . . . . . . . . . . . . . . . .
==========================
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