Xxxxx Xxxxxxx Natural Gas Corp.
825,000 Shares (1)
Common Stock
($.01 par value)
International Underwriting Agreement
Xxxxxx, Xxxxxxx
, 0000
Salomon Brothers International Limited
Credit Suisse First Boston (Europe) Limited
Howard, Weil, Labouisse, Xxxxxxxxxx Incorporated
Xxxxxx Xxxxxxx & Co. International Limited
As International Representatives of the several
International Underwriters,
c/o Salomon Brothers International Limited
Victoria Plaza
000 Xxxxxxxxxx Xxxxxx Xxxx
Xxxxxx XX0X 0XX XXXXXXX
Dear Sirs:
Xxxxx Xxxxxxx Natural Gas Corp. (the "Company"), an Oklahoma
corporation, proposes to sell to the underwriters named in Schedule I hereto
(the "International Underwriters"), for whom you (the "International
Representatives") are acting as representatives, 412,500 shares of Common Stock,
$.01 par value ("Common Stock"), of the Company, and Xxxxx Xxxxxxx Natural Gas
Holdings Corp. (the "Selling Stockholder"), a Delaware corporation and an
indirect wholly owned subsidiary of S.A. Xxxxx Xxxxxxx et Cie (the "Parent"),
proposes to sell to the International Underwriters 412,500 shares of Common
Stock (said shares to be issued and sold by the Company and shares to be sold by
the Selling Stockholder collectively being hereinafter called the "International
Underwritten Securities"). The Selling Stockholder also proposes to grant to
the International Underwriters an option to purchase up to 123,750 additional
shares of Common Stock (the "International Option Securities"; the International
Option Securities, together with the International Underwritten Securities,
being hereinafter called the "International Securities"). It is understood that
the Company, the Selling Stockholder and the Parent are concurrently entering
into a U.S. Underwriting Agreement dated the date hereof (the "U.S. Underwriting
Agreement") providing for the sale by the Company and the Selling Stockholder of
an aggregate of 4,675,000 shares of Common Stock (said shares to be sold by the
Company and the Selling Stockholder pursuant to the U.S. Underwriting Agreement
being hereinafter called the "U.S. Underwritten Securities"), in the United
States and Canada through arrangements with certain underwriters in the United
States and Canada (the "U.S. Underwriters"), for whom Salomon Brothers
Inc, Credit Suisse First Boston
_______________
(1) Plus an option to purchase from the Selling Stockholder up to 123,750
additional shares to cover over-allotments.
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Corporation, Howard, Weil, Labouisse, Xxxxxxxxxx Incorporated and Xxxxxx
Xxxxxxx & Co. Incorporated are acting as representatives (the
"Representatives"), and providing for the grant to the U.S. Underwriters of
an option to purchase from the Selling Stockholder up to 701,250 additional
shares of Common Stock (the "U.S. Option Securities"; the U.S. Option
Securities, together with the U.S. Underwritten Securities, being hereinafter
called the "U.S. Securities" and the International Securities, together with
the U.S. Securities, being hereinafter called the "Securities"). It is
further understood and agreed that the U.S. Underwriters and the
International Underwriters have entered into an Agreement Between U.S.
Underwriters and International Underwriters dated the date hereof (the
"Agreement Between U.S. Underwriters and International Underwriters"),
pursuant to which, among other things, the International Underwriters may
purchase from the U.S. Underwriters a portion of the U.S. Securities to be
sold pursuant to the U.S. Underwriting Agreement and the U.S. Underwriters
may purchase from the International Underwriters a portion of the
International Securities to be sold pursuant to the International
Underwriting Agreement.
1. REPRESENTATIONS AND WARRANTIES.
(a) The Company, the Selling Stockholder and the Parent jointly and
severally represent and warrant to, and agree with, each International
Underwriter as set forth below in this Section 1. Certain terms used in this
Section 1 are defined in paragraph (iii) hereof.
(i) The Company meets the requirements for use of Form S-3 under the
Securities Act of 1933 (the "Act") and has filed with the Securities and
Exchange Commission (the "Commission") a registration statement (File No.
333-21321) on such Form, including related preliminary prospectuses, for
the registration under the Act of the offering and sale of the Securities.
The Company may have filed one or more amendments thereto, including the
related preliminary prospectuses, each of which has previously been
furnished to you. The Company will next file with the Commission one of
the following: (A) prior to effectiveness of such registration statement,
a further amendment to such registration statement, including the form of
final prospectus, (B) final prospectuses in accordance with Rules 430A and
424(b)(1) or (4), or (C) final prospectuses in accordance with Rules 415
and 424(b)(2) or (5). In the case of clause (B), 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 the Prospectuses (as hereinafter
defined) with respect to the Securities and the offering thereof. As
filed, such amendment and form of final prospectuses, or such final
prospectuses, shall contain all Rule 430A Information, together with all
other such required information, with respect to the Securities and the
offering thereof and, except to the extent the International
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
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information and other changes (beyond that contained in the latest
International Preliminary Prospectus (as hereinafter defined)) as the
Company has advised you, prior to the Execution Time, will be included
or made therein.
The Company agrees that it will not, without your agreement, file a
Rule 462(b) Registration Statement. If the Registration Statement contains
the undertaking specified by Regulation S-K Item 512(a), the Registration
Statement, at the Execution Time, meets the requirements set forth in
Rule 415(a)(i)(x).
It is understood that two forms of prospectus are to be used in
connection with the offering and sale of the Securities: one form of
prospectus relating to the U.S. Securities, which are to be offered and
sold to United States and Canadian Persons (as hereinafter defined), and
one form of prospectus relating to the International Securities, which are
to be offered and sold to persons other than United States and Canadian
Persons. The two forms of prospectus are identical except for the outside
front cover page, the inside front cover page, the discussion under the
heading "Underwriting" and the outside back cover page. Such form of
prospectus relating to the U.S. Securities as first filed pursuant to
Rule 424(b) or, if no filing pursuant to Rule 424(b) is made, such form of
prospectus included in the Registration Statement at the Effective Date, is
hereinafter called the "U.S. Prospectus"; such form of prospectus relating
to the International Securities as first filed pursuant to Rule 424(b) or,
if no filing pursuant to Rule 424(b) is made, such form of prospectus
included in the Registration Statement at the Effective Date, is
hereinafter called the "International Prospectus"; and the U.S. Prospectus
and the International Prospectus are hereinafter collectively called the
"Prospectuses".
(ii) On the Effective Date, the Registration Statement did or will,
and when the Prospectuses are first filed (if required) in accordance with
Rule 424(b) and on the Closing Date (as defined herein) and on any date on
which shares sold in respect of the International Underwriters' over-
allotment option are purchased, if such date is not the Closing Date (a
"Settlement Date"), each Prospectus (and any supplements thereto) will,
comply in all material respects with the applicable requirements of the Act
and the Securities Exchange Act of 1934 (the "Exchange Act") and the
respective rules thereunder; on the Effective Date, 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, each Prospectus, if not filed pursuant to Rule 424(b),
did not or will not, and on the date of any filing pursuant to Rule 424(b)
and on the Closing Date and any Settlement Date, each 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, that the Company, the Selling
Stockholder and the Parent make no representations or warranties as to the
information contained in or
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omitted from the Registration Statement, or the Prospectuses (or
any supplement thereto) in reliance upon and in conformity with
information furnished in writing to the Company by or on behalf of any
International Underwriter relating to such International Underwriter
through the International Representatives specifically for inclusion in the
Registration Statement or the Prospectuses (or any supplement thereto).
(iii) The terms which follow, when used in this Agreement, shall have
the meanings indicated. The term "Effective Date" shall mean each date
that the Registration Statement and any post-effective amendment or
amendments thereto and any Rule 462(b) Registration Statement became or
become effective and each date after the date hereof on which a document
incorporated by reference in the Registration Statement is filed.
"Execution Time" shall mean the date and time that this Agreement is
executed and delivered by the parties hereto. "Prospectuses" shall mean the
prospectuses 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 forms of final prospectuses
relating to the Securities included in the Registration Statement at the
Effective Date. "Registration Statement" shall mean the registration
statement referred to in paragraph (i) above, including incorporated
documents, 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 Rule 462(b) Registration Statement becomes effective prior
to the Closing Date (as hereinafter defined), 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 415", "Rule 424", "Rule 430A", "Rule 462" and
"Regulation S-K" refer to such rules or regulation under the Act. "Rule
430A Information" means 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. "United States or
Canadian Person" shall mean any person who is a national or resident of the
United States or Canada, any corporation, partnership, or other entity
created or organized in or under the laws of the United States or Canada or
of any political subdivision thereof, or any estate or trust the income of
which is subject to United States or Canadian Federal income taxation,
regardless of its source (other than any non-United States or non-Canadian
branch of any United States or Canadian Person), and shall include any
United States or Canadian branch of a person other than a United States or
Canadian Person. "U.S." or "United States" shall mean the United States of
America (including the states thereof and the District of Columbia), its
territories, its possessions and other areas subject to its jurisdiction.
"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 initial registration statement (File No. 333-
21321). Any reference herein to the Registration Statement, Preliminary
Prospectuses or the Prospectuses shall be deemed to refer to and include
the documents
5
incorporated by reference therein pursuant to Item 12 of Form S-3 which
were filed under the Exchange Act on or before the Effective Date of
the Registration Statement or the issue date of the Preliminary
Prospectuses or the Prospectuses, as the case may be; and any reference
herein to the terms "amend", "amendment" or "supplement" with respect
to the Registration Statement, the Preliminary Prospectuses or the
Prospectuses shall be deemed to refer to and include the filing of any
document under the Exchange Act after the Effective Date of the
Registration Statement, or the issue date of the Preliminary
Prospectuses or the Prospectuses, as the case may be, deemed to be
incorporated therein by reference. The "U.S. Preliminary Prospectus"
and the "International Preliminary Prospectus", respectively, shall
mean any preliminary prospectus with respect to the offering of the
U.S. Securities and the International Securities, as the case may be,
referred to in paragraph (i) above and any preliminary prospectus with
respect to the offering of the U.S. Securities and the International
Securities, as the case may be, included in the Registration Statement
at the Effective Date that omits Rule 430A Information; and the U.S.
Preliminary Prospectus and the International Preliminary Prospectus are
hereinafter collectively called the "Preliminary Prospectuses".
(b) The Selling Stockholder and the Parent, jointly and severally,
represent and warrant to, and agree with, each International Underwriter that:
(i) The Selling Stockholder is the lawful owner of the International
Securities to be sold by the Selling Stockholder hereunder and upon sale
and delivery of, and payment for, such International Securities, as
provided herein, the Selling Stockholder will convey good and marketable
title to such International Securities, free and clear of all liens,
encumbrances, equities, security interests and claims whatsoever.
(ii) The 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, under the Exchange
Act or otherwise, in stabilization or manipulation of the price of any
security of the Company to facilitate the sale or resale of the
International Securities and has not effected any sales of shares of Common
Stock which, if effected by the issuer, would be required to be disclosed
in response to Item 701 of Regulation S-K.
(iii) No consent, approval, authorization or order of any court or
governmental agency or body is required for the consummation by the Selling
Stockholder of the transactions contemplated herein, except such as may
have been obtained under the Act, the Exchange Act and such as may be
required under the blue sky laws of any jurisdiction in connection with the
purchase and distribution of the International Securities by the
International Underwriters and such other approvals as have been obtained.
(iv) Neither the sale of the International Securities being sold by
the Selling Stockholder nor the consummation of any other of the
transactions
6
herein contemplated by the Selling Stockholder or the fulfillment
of the terms hereof by the Selling Stockholder will conflict
with, result in a breach or violation of, or constitute a default under
any law or the charter or by-laws of the Selling Stockholder or the terms
of any indenture or other agreement or instrument to which the Selling
Stockholder or any of its subsidiaries is a party or bound, or any
judgement, order or decree applicable to the Selling Stockholder or any of
its subsidiaries of any court, regulatory body, administrative agency,
governmental body or arbitrator having jurisdiction over the Selling
Stockholder or any of its subsidiaries.
Any certificate signed by any officer of the Company and delivered to
the International Representatives or counsel for the International 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 International Underwriter.
2. PURCHASE AND SALE. (a) Subject to the terms and conditions and
in reliance upon the representations and warranties herein set forth, the
Company and the Selling Stockholder agree, severally and not jointly, to sell to
each International Underwriter, and each International Underwriter agrees,
severally and not jointly, to purchase from the Company and the Selling
Stockholder, at a purchase price of $[ ] per share, the amount of the
International Underwritten Securities set forth opposite such International
Underwriter's name in Schedule I hereto.
(b) Subject to the terms and conditions and in reliance upon the
representations and warranties herein set forth, the Selling Stockholder hereby
grants an option to the several International Underwriters to purchase,
severally and not jointly, up to 123,750 shares of the International Option
Securities at the same purchase price per share as the International
Underwriters shall pay for the International Underwritten Securities. Said
option may be exercised only to cover over-allotments in the sale of the
International Underwritten Securities by the International Underwriters. Said
option may be exercised in whole or in part at any time (but not more than once)
on or before the 30th day after the date of the International Prospectus upon
written, telecopied or telegraphic notice by the International Representatives
to the Selling Stockholder setting forth the number of shares of the
International Option Securities as to which the several International
Underwriters are exercising the option and the Settlement Date. Delivery of
certificates for the shares of International Option Securities by the Selling
Stockholder, and payment therefor to the Selling Stockholder shall be made as
provided in Section 3 hereof. The maximum number of shares of the International
Option Securities to be sold by the Selling Stockholder is set forth in
Schedule II hereto. In the event that the International Underwriters exercise
less than their full over-allotment option, the number of shares of the
International Option Securities to be sold by each party listed on Schedule II
shall be, as nearly as practicable, in the same proportion to each other as are
the number of shares of the International Option Securities listed opposite
their respective names on said Schedule II. The number of shares of the
International Option Securities to be purchased by each International
Underwriter shall be the same percentage of the total
7
number of shares of the International Option Securities to be purchased by
the several International Underwriters as such International Underwriter is
purchasing of the International Underwritten Securities, subject to such
adjustments as you in your absolute discretion shall make to eliminate any
fractional shares.
3. DELIVERY AND PAYMENT. Delivery of and payment for the
International Underwritten Securities and the International Option Securities
(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) shall be made at
10:00 AM, New York City time, on [ ], 1997, or such later date (not later
than [ ], 1997) as the International Representatives and the
Representatives shall designate, which date and time may be postponed by
agreement among the International Representatives, the Representatives, the
Company and the Selling Stockholder or as provided in Section 9 hereof (such
date and time of delivery and payment for the International Securities being
herein called the "Closing Date"). Delivery of the International Securities
shall be made to the International Representatives for the respective accounts
of the several International Underwriters against payment by the several
International Underwriters through the International Representatives of the
respective aggregate purchase prices of the International Securities being sold
by the Company and the Selling Stockholder to or upon the order of the Company
and the Selling Stockholder, by wire transfer payable in same day funds.
Delivery of the International Underwritten Securities and the International
Option Securities shall be made at such location as the International
Representatives shall reasonably designate at least one business day in advance
of the Closing Date and payment for such International Securities shall be made
at the office of Cravath, Swaine & Xxxxx, counsel for the International
Underwriters at Xxxxxxxxx Xxxxx, 000 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx.
Certificates for the International Securities shall be registered in such names
and in such denominations as the International Representatives may request not
less than three full business days in advance of the Closing Date.
The Company and the Selling Stockholder agree to have the
International Securities available for inspection, checking and packaging by the
International Representatives in New York, New York, not later than 1:00 PM on
the business day prior to the Closing Date.
The Selling Stockholder will pay all applicable state transfer taxes,
if any, involved in the transfer to the several International Underwriters of
the International Securities to be purchased by them from the Selling
Stockholder and the respective International 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 Stockholder will
deliver (at the expense of the Selling Stockholder) to the International
Representatives, at Seven World Trade Center, New York, New York, on the date
specified by the International Representatives (which shall be within three
business days after exercise of said option), certificates for the International
Option Securities in such names and
8
denominations as the International Representatives shall have requested
against payment of the purchase price thereof to the Selling Stockholder by
wire transfer payable in same day funds. If settlement for the International
Option Securities occurs after the Closing Date, the Selling Stockholder will
deliver to the International Representatives on the Settlement Date for the
International Option Securities, and the obligation of the International
Underwriters to purchase the International 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.
It is understood and agreed that the Closing Date shall occur
simultaneously with the "Closing Date" under the U.S. Underwriting Agreement,
and that the Settlement Date, if any, shall occur simultaneously with the
"Settlement Date" under the U.S. Underwriting Agreement.
4. OFFERING BY UNDERWRITERS. It is understood that the several
International Underwriters propose to offer the International Securities for
sale to the public as set forth in the International Prospectus.
5. AGREEMENTS.
(a) The Company agrees with the several International Underwriters
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 offering of
the Securities, the Company will not file any amendment of the Registration
Statement or supplement to the Prospectuses or any Rule 462(b) Registration
Statement unless the Company has furnished a copy for your review prior to
the filing and will not file any such proposed amendment, supplement, or
Rule 462(b) Registration Statement 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 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 International Representatives of such timely filing. The Company will
promptly advise the International 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) or when any Rule 462(b) Registration Statement
shall have been filed with the Commission, (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
9
any Rule 462(b) 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 either of the Prospectuses 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 either of the Prospectuses
to comply with the Act or the Exchange Act or the respective rules
thereunder, the Company promptly will (i) prepare and file with the
Commission, subject to the second sentence of subparagraph (a)(i) of this
Section 5, an amendment or supplement which will correct such statement or
omission or an amendment which will effect such compliance and (ii) supply
any supplemented Prospectuses to you in such quantities as you may
reasonably request.
(iii) As soon as practicable, the Company will make generally
available to its security holders and to the International 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.
(iv) The Company will furnish to the International Representatives
and counsel for the International Underwriters, without charge, signed
copies of the Registration Statement (including exhibits thereto) and to
each other International Underwriter a copy of the Registration Statement
(without exhibits thereto) and, so long as delivery of a prospectus by an
International Underwriter or dealer may be required by the Act or otherwise
required, as many copies of each International Preliminary Prospectus and
the International Prospectus and any supplement thereto as the
International 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 International
Representatives may designate, will maintain such qualifications in effect
so long as required for the distribution of the securities and will pay the
fee of the National Association of Securities Dealers, Inc., in connection
with its review of the offering.
10
(vi) The Company will not, for a period of 90 days following the
Execution Time, without the prior written consent of the Representatives
and the International Representatives, offer, sell or contract to sell,
pledge or otherwise dispose of, or enter into any transaction which is
designed to, or could be expected to, result in the disposition by any
person of directly or indirectly, or announce the offering of, or file 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 or any
securities convertible into, or exchangeable for, shares of capital stock
of the Company or announce an intention to effect any such transaction;
PROVIDED, HOWEVER, that the Company may issue and sell the Securities
pursuant to the terms of this Agreement and the U.S. Underwriting
Agreement, may issue and sell Common Stock pursuant to the terms of 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 Common Stock issuable upon the conversion of securities or the
exercise of warrants outstanding at the Execution Time.
(b) Each International Underwriter agrees that (i) it is not
purchasing any of the International Securities for the account of any United
States or Canadian Person, (ii) it has not offered or sold, and will not offer
or sell, directly or indirectly, any of the International Securities or
distribute any International Prospectus to any person in the United States or
Canada, or to any United States or Canadian Person, and (iii) any dealer to whom
it may sell any of the International Securities will represent that it is not
purchasing for the account of any United States or Canadian Person and agree
that it will not offer or resell, directly or indirectly, any of the
International Securities in the United States or Canada, or to any United States
or Canadian Person or to any other dealer who does not so represent and agree;
PROVIDED, HOWEVER, that the foregoing shall not restrict (A) purchases and sales
between the U.S. Underwriters on the one hand and the International Underwriters
on the other hand pursuant to the Agreement Between U.S. Underwriters and
International Underwriters, (B) stabilization transactions contemplated under
the Agreement Between U.S. Underwriters and International Underwriters,
conducted through Salomon Brothers Inc (or through the Representatives and
International Representatives) as part of the distribution of the Securities,
and (C) sales to or through (or distributions of International Prospectuses or
International Preliminary Prospectuses to) persons not United States or Canadian
Persons who are investment advisors, or who otherwise exercise investment
discretion, and who are purchasing for the account of any United States or
Canadian Person.
(c) The agreements of the International Underwriters set forth in
paragraph (b) of this Section 5 shall terminate upon the earlier of the
following events:
(i) a mutual agreement of the Representatives and the International
Representatives to terminate the selling restrictions set forth in
paragraph (b) of this Section 5 and in Section 5(b) of the U.S.
Underwriting Agreement; or
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(ii) the expiration of a period of 30 days after the Closing Date,
unless (A) the International Representatives shall have given notice to the
Company and the Representatives that the distribution of the International
Securities by the International Underwriters has not yet been completed, or
(B) the Representatives shall have given notice to the Company and the
International Underwriters that the distribution of the U.S. Securities by
the U.S. Underwriters has not yet been completed. If such notice by the
Representatives or the International Representatives is given, the
agreements set forth in such paragraph (b) shall survive until the earlier
of (1) the event referred to in clause (i) of this subsection (c) or (2)
the expiration of an additional period of 30 days from the date of any such
notice.
(d) Each International Underwriter severally represents and agrees
that:
(i) it has not offered or sold and, prior to the expiry of six months
from the closing of the offering of the International Securities, will not
offer or sell any shares of Common Stock in the United Kingdom other than
to persons whose ordinary activities involve them in acquiring, holding,
managing or disposing of investments (whether as principal or agent) for
the purposes of their businesses or otherwise in circumstances which have
not resulted in and will not result in an offer to the public within the
meaning of the Public Offers of Securities Regulations 1995;
(ii) it has complied and will comply with all applicable provisions
of the Financial Services Xxx 0000 with respect to anything done by it in
relation to the shares of Common Stock, in, from or otherwise involving the
United Kingdom; and
(iii) it has only issued or passed on and will only issue or pass on
to any person in the United Kingdom any document received by it in
connection with the issue of the shares of Common Stock if that person is
of a kind described in Article 11(3) of the Financial Services Xxx 0000
(Investment Advertisements) (Exemptions) Order 1995 or a person to whom
such document may otherwise lawfully be issued or passed on.
(e) The Selling Stockholder agrees with the several International
Underwriters that it will not during the period of 90 days following the
Execution Time, without the prior written consent of the Representatives and the
International Representatives, offer, sell, contract to sell, pledge, or
otherwise dispose of, or enter into any transaction which is designed to, or
could be expected to, result in the disposition by any person, directly or
indirectly, or announce the offering of, or cause to be filed 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 or any securities convertible into or exercisable
or exchangeable for such capital stock, or announce an intention to effect any
such transaction, other than (i) the Shares to be sold hereunder and under the
U.S.
12
Underwriting Agreement, (ii) the exercise of any option or warrant or the
conversion of a security outstanding on the date hereof and referred to in the
Prospectuses and, (iii) the pledge of Common Stock in effect at the Execution
Time and described in the Prospectuses under the Section captioned "Selling
Shareholder and Principal Shareholders".
6. CONDITIONS TO THE OBLIGATIONS OF THE INTERNATIONAL UNDERWRITERS.
The obligations of the International Underwriters to purchase the International
Underwritten Securities and the International Option Securities, as the case may
be, shall be subject to the accuracy of the representations and warranties on
the part of the Company, the Selling Stockholder, and the Parent 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,
the Selling Stockholder and the Parent made in any certificates pursuant to the
provisions hereof, to the performance by the Company, the Selling Stockholder
and the Parent 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 and the International
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 either of the
Prospectuses, 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.
(b) The Company shall have furnished to the International
Representatives the opinion of Xxxxx & Xxxxxxx, counsel for the Company,
dated the Closing Date, to the effect that:
(i) each of the Company and its subsidiary, Xxxxx Xxxxxxx Gas
Marketing Corp. (the "Subsidiary"), has been duly incorporated and is
validly existing as a corporation in good standing under the laws of
the jurisdiction in which it is chartered or organized, with full
corporate power and authority to own its properties and conduct its
business as described in the Prospectuses, 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 wherein it
owns or leases material properties or conducts material business;
13
(ii) all the outstanding shares of capital stock of the
Subsidiary have been duly and validly authorized and issued and are
fully paid and nonassessable, and, except as otherwise set forth in
the Prospectuses, all outstanding shares of capital stock of the
Subsidiary 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 interests, claims, liens or encumbrances;
(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 Common Stock (including the Securities being
sold hereunder by the Selling Stockholder) have been duly and validly
authorized and issued and are fully paid and nonassessable; the
Securities being sold hereunder by the Company have been duly and
validly authorized, and, when issued and delivered to and paid for by
the International Underwriters pursuant to this Agreement and by the
U.S. Underwriters pursuant to the U.S. Underwriting Agreement, will be
validly issued, fully paid and nonassessable; (the Securities being
sold by the Selling Stockholder are duly listed and admitted for
trading on the New York Stock Exchange; the Securities being sold
hereunder by the Company are duly authorized for listing, subject to
official notice of issuance and evidence of satisfactory distribution,
on the New York Stock Exchange; 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;
(iv) to the best knowledge of such counsel, there is no pending
or threatened action, suit or proceeding before any court or
governmental agency, authority or body or any arbitrator involving the
Company or any of its subsidiaries of a character required to be
disclosed in the Registration Statement which is not adequately
disclosed in the Prospectuses, and there is no franchise, contract or
other document of a character required to be described in the
Registration Statement or Prospectuses, or to be filed as an exhibit,
which is not described or filed as required;
(v) the Registration Statement has become effective under the
Act; any required filing of the Prospectuses, 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 best knowledge
of such counsel after due inquiry, no stop order suspending the
effectiveness of the Registration Statement has been issued, no
proceedings for that purpose have been instituted or threatened and
the Registration Statement and each of the Prospectuses (other than
the financial statements and other financial and statistical
information contained therein as to which
14
such counsel need express no opinion) comply as to form in all
material respects with the applicable requirements of the Act and
the Exchange Act and the respective rules thereunder; and such
counsel has no reason to believe that at the Effective Date the
Registration Statement includes any untrue statement of a
material fact or omitted to state any material fact required to
be stated therein or necessary to make the statements therein not
misleading or that the Prospectuses include any untrue statement
of a material fact or omit to state a material fact necessary to
make the statements therein, in the light of the circumstances
under which they were made, not misleading;
(vi) this Agreement and the U.S. Underwriting Agreement have been
duly authorized, executed and delivered by the Company;
(vii) no consent, approval, authorization or order of any court
or governmental agency or body is required for the consummation of the
transactions contemplated herein, except such as have been obtained
under the Act, the Exchange 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 International Underwriters and
such other approvals (specified in such opinion) as have been
obtained;
(viii) neither the issuance, offering and sale of the Securities,
nor the consummation of any other of the transactions contemplated
herein or in the U.S. Underwriting Agreement nor the fulfillment of
the terms hereof will conflict with, result in a breach or violation
of, or constitute a default under any law or the charter or by-laws of
the Company or the terms of any indenture or other agreement or
instrument known to such counsel and to which the Company or any of
its subsidiaries is a party or bound or any judgment, order or decree
known to such counsel to be applicable to the Company or any of its
subsidiaries of any court, regulatory body, administrative agency,
governmental body or arbitrator having jurisdiction over the Company
or any of its subsidiaries; and
(ix) no holders of securities of the Company have rights to the
registration of such securities under the Registration Statement,
except for the Selling Stockholder pursuant to the Registration Rights
Agreement dated as of November 9, 1993, entered into by and between
the Company and the Selling Stockholder.
In rendering such opinion, such counsel may rely (A) as to matters involving the
application of laws of any jurisdiction other than the State of Oklahoma 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 International
Underwriters and (B) as to matters of fact, to the extent they deem proper, on
certificates of responsible
15
officers of the Company and public officials. Reference to the Prospectuses
in this paragraph (b) include any supplements thereto at the Closing Date.
(c) The Selling Stockholder shall have furnished to the International
Representatives the opinion of Xxxxxx Xxxxxxx, Esq., Senior Counsel to the
Selling Stockholder, dated the Closing Date, to the effect that:
(i) this Agreement and the U.S. Underwriting Agreement have been duly
authorized, executed and delivered by the Selling Stockholder and the
Selling Stockholder has full legal right and authority to sell, transfer
and deliver in the manner provided in this Agreement the Securities being
sold by the Selling Stockholder hereunder;
(ii) the delivery by the Selling Stockholder to the several
International Underwriters of certificates for the Securities being sold
hereunder by the Selling Stockholder against payment therefor as provided
herein, will pass good and marketable title to such Securities to the
several International Underwriters, free and clear of all liens,
encumbrances, equities, security interests and claims whatsoever;
(iii) no consent, approval, authorization or order of any court or
governmental agency or body is required for the consummation by the Selling
Stockholder of the transactions contemplated herein, except such as may
have been obtained under the Act, the Exchange 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 International
Underwriters and such other approvals (specified in such opinion) as have
been obtained; and
(iv) neither the sale of the Securities being sold by the Selling
Stockholder nor the consummation of any other of the transactions herein
contemplated by the Selling Stockholder or the fulfillment of the terms
hereof by the Selling Stockholder will conflict with, result in a breach or
violation of, or constitute a default under any law or the charter or By-
laws of the Selling Stockholder or the terms of any indenture or other
agreement or instrument known to such counsel and to which the Selling
Stockholder or any of its subsidiaries is a party or bound, or any
judgement, order or decree known to such counsel to be applicable to the
Selling Stockholder or any of its subsidiaries of any court, regulatory
body, administrative agency, governmental body or arbitrator having
jurisdiction over the Selling Stockholder or any of its subsidiaries.
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 Selling
Stockholder and public officials.
(d) The Parent shall have furnished to the International
Representatives the opinion of counsel of the Parent, dated the Closing Date, to
the effect that:
16
(i) this Agreement and the U.S. Underwriting Agreement have been duly
authorized, executed and delivered by the Parent;
(ii) no consent, approval, authorization or order of any court or
governmental agency or body is required for the consummation by the Parent
of the transactions contemplated herein, except such as may have been
obtained under the Act, the Exchange 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 International Underwriters and such
other approvals (specified in such opinion) as have been obtained; and
(iii) neither the consummation of any of the transactions herein
contemplated by the Parent or the fulfillment of the terms hereof by the
Parent will conflict with, result in a breach or violation of, or
constitute a default under any law or the charter or By-laws of the Parent
or the terms of any indenture or other agreement or instrument known to
such counsel and to which the Parent or any of its subsidiaries is a party
or bound, or any judgement, order or decree known to such counsel to be
applicable to the Parent or any of its subsidiaries of any court,
regulatory body, administrative agency, governmental body or arbitrator
having jurisdiction over the Parent or any of its subsidiaries.
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 Parent
and public officials.
(e) The International Representatives shall have received from
Cravath, Swaine & Xxxxx, counsel for the International 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 International
Representatives may reasonably require, and the Company, the Selling Stockholder
and the Parent shall have furnished to such counsel such documents as they
request for the purpose of enabling them to pass upon such matters.
(f) The Company shall have furnished to the International
Representatives a certificate of the Company, signed by the Chief Executive
Officer and the Chief Financial Officer and Treasurer of the Company, dated the
Closing Date, to the effect that the signers of such certificate have carefully
examined the Registration Statement, the Prospectuses, any supplement 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;
17
(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 (exclusive of any supplement thereto), there has been
no material adverse change in the condition (financial or other), earnings,
business or properties 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 (exclusive of any supplement
thereto).
(g) The Selling Stockholder shall have furnished to the
International Representatives a certificate, signed by the President and
Treasurer of the 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 either of the Prospectuses and
this Agreement and that the representations and warranties of the 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.
(h) The Parent shall have furnished to the International
Representatives a certificate, signed by the President Directeur General of
the Parent, dated the Closing Date, to the effect that the signer of such
certificate has carefully examined the Registration Statement, the
Prospectuses, any supplement to either of the Prospectuses and this Agreement
and that the representations and warranties of the Parent 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.
(i) At the Execution Time and at the Closing Date, Ernst & Young LLP
shall have furnished to the International 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 International 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 or incorporated 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 (but not an examination in accordance with
generally accepted auditing standards) which would not necessarily reveal
matters of significance with respect to the comments set forth in such
letter; a reading of
18
the minutes of the meetings of the stockholders, directors and the audit,
compensation and executive 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, 1996, nothing came
to their attention which caused them to believe that:
(1) with respect to the period subsequent to December 31, 1996,
there were any changes, at a specified date not more than five
business days prior to the date of the letter, in the long-term debt
of the Company and its subsidiaries or capital stock of the Company or
decreases in the stockholders' equity of the Company as compared with
the amounts shown on the December 31, 1996, consolidated balance sheet
included or incorporated in the Registration Statement and the
Prospectuses, or for the period from January 1, 1997 to such specified
date there were any decreases, as compared with the comparable period
in 1996 in total revenues or oil and gas sales or income before income
taxes 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 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
International Representatives; or
(2) the information included or incorporated in the Registration
Statement and Prospectuses in response to Regulation S-K, Item 301
(Selected Financial Data), Item 302 (Supplementary Financial
Information) and Item 402 (Executive Compensation) is not in
conformity with the applicable disclosure requirements of
Regulation S-K; and
(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 (which is limited to accounting, financial
or statistical information derived from the general accounting records of
the Company and its subsidiaries) set forth in the Registration Statement
and the Prospectuses, agrees with the accounting records of the Company and
its subsidiaries, excluding any questions of legal interpretation.
References to the Prospectuses in this paragraph (g) include any
supplement thereto at the date of the letter.
Ernst & Young LLP shall also have furnished to the Company a letter
stating that in planning and performing the audit of the consolidated financial
statements of the Company, for the year ended December 31, 1996, they considered
the internal control structure in determining the audit procedures for
expressing an opinion on the consolidated financial statements (but not to
provide assurance on the internal control structure). Such letter shall
indicate whether they noted any matters
19
involving the internal control structure and its operation which they
considered to be material weaknesses.
(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 Prospectuses (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 (g) of this Section 6 or (ii) any change, or
any development involving a prospective change, in or affecting the business or
properties of the Company and its subsidiaries the effect of which, in any case
referred to in clause (i) or (ii) above, is, in the judgment of the
International 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 Prospectuses (exclusive of any supplement thereto).
(k) On or prior to the Execution Time, the New York Stock Exchange
shall have approved the International Underwriters' participation in the
distribution of the International Securities to be sold by the Selling
Stockholder.
(l) At the Execution Time, the Company shall have furnished to the
International Representatives a letter substantially in the form of Exhibit A
hereto from each executive officer and director of the Company addressed to the
International Representatives, in which each such person agrees not to offer,
sell or contract to sell, or otherwise dispose of, (or enter into any
transaction which is designed to, or would be expected to, result in the
disposition by any person of) directly or indirectly, or announce an offering
of, any shares of Common Stock beneficially owned by such person or any
securities convertible into, or exchangeable for, shares of Common Stock for a
period of 90 days following the Execution Time without the prior written consent
of the Representatives and the International Representatives, other than shares
of Common Stock disposed of as bona fide gifts.
(m) Subsequent to the Execution Time, there shall not have been any
decrease in the rating of any of the Company's debt securities by any
"nationally recognized statistical rating organization" (as defined for purposes
of Rule 436(g) under the Act) or any notice given of any intended or potential
decrease in any such rating or of a possible change in any such rating that does
not indicate the direction of the possible change.
(n) The National Association of Securities Dealers, Inc. ("NASD"),
upon review of the terms of the public offering of the International
Underwritten Securities, shall not have objected to the participation by any of
the International Underwriters in such offering or asserted any violation of the
by-laws of the NASD.
(o) On or prior to the Execution Time, the New York Stock Exchange
shall have approved the listing of the Securities, subject to official notice of
issuance.
20
(p) Prior to the Closing Date, the Company shall have furnished to
the International Representatives such further information, certificates and
documents as the International Representatives may reasonably request.
(q) The closing of the purchase of the U.S. Underwritten Securities
to be issued and sold by the Company pursuant to the U.S. Underwriting Agreement
shall occur concurrently with the closing described herein.
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 International Representatives and counsel for the
International Underwriters, this Agreement and all obligations of the
International Underwriters hereunder may be canceled at, or at any time prior
to, the Closing Date by the International Representatives. Notice of such
cancelation shall be given to the Company, the Selling Stockholder and the
Parent in writing or by telephone, facsimile or telegraph confirmed in writing.
The documents required to be delivered by this Section 6 shall be
delivered at the office of Cravath, Swaine & Xxxxx, counsel for the
International Underwriters, at Worldwide Plaza, 000 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx
Xxxx, xx the Closing Date.
7. REIMBURSEMENT OF INTERNATIONAL UNDERWRITERS' EXPENSES. If the
sale of the Securities provided for herein is not consummated because any
condition to the obligations of the International 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, the Selling Stockholder or the Parent to perform any agreement
herein or comply with any provision hereof other than by reason of a default by
any of the International Underwriters, the Company will reimburse the
International Underwriters severally upon demand for all reasonable out-of-
pocket expenses paid to third parties (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. If the Company is
required to make any payments to the International Underwriters under this
Section 7 because of the Selling Stockholder's or the Parent's refusal,
inability or failure to satisfy any condition to the obligations of the
International Underwriters set forth in Section 6, the Selling Stockholder or
the Parent, as the case may be, shall reimburse the Company on demand for all
amounts so paid.
8. INDEMNIFICATION AND CONTRIBUTION. (a) The Company, the Selling
Stockholder and the Parent jointly and severally agree to indemnify and hold
harmless each International Underwriter, the directors, officers, employees and
agents of each International Underwriter and each person who controls any
International 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
21
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
U.S. or International Preliminary Prospectus or in either of the
Prospectuses, 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 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, the
Selling Stockholder and the Parent 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 any
International Underwriter relating to such International Underwriters through
the International Representatives specifically for inclusion therein. This
indemnity agreement will be in addition to any liability which the Company,
the Selling Stockholder or the Parent may otherwise have.
(b) Each International Underwriter severally agrees to indemnify and
hold harmless the Company, each of its directors, each of its officers who signs
the Registration Statement, and each person who controls the Company within the
meaning of either the Act or the Exchange Act, the Selling Stockholder and the
Parent, to the same extent as the foregoing indemnity from the Company to each
International Underwriter, but only with reference to written information
relating to such International Underwriter furnished to the Company by or on
behalf of such International Underwriter through the International
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 International Underwriter may otherwise have. The Company,
the Selling Stockholder and the Parent acknowledge that the statements set forth
in the last paragraph of the cover page and under the heading "Underwriting" in
any U.S. or International Preliminary Prospectus and the Prospectuses constitute
the only information furnished in writing by or on behalf of the several
International Underwriters for inclusion in any U.S. or International
Preliminary Prospectus or the Prospectuses, and you, as the International
Representatives, confirm that such statements are correct.
(c) 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 not relieve it from liability under paragraph (a) or (b) above 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
22
obligations to any indemnified party other than the indemnification
obligation provided in paragraph (a) or (b) above. 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 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 (i) the use of counsel chosen by the indemnifying party to
represent the indemnified party would present such counsel with a conflict of
interest, (ii) 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, (iii) 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 (iv) 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.
(d) In the event that the indemnity provided in paragraph (a) or (b)
of this Section 8 is unavailable to or insufficient to hold harmless an
indemnified party for any reason, the Company, the Selling Stockholder and the
Parent, jointly and severally, and the International Underwriters agree to
contribute to the aggregate losses, claims, damages and liabilities (including
legal or other expenses reasonably incurred in connection with investigating or
defending same) (collectively "Losses") to which the Company, the Selling
Stockholder, the Parent and one or more of the International Underwriters may be
subject in such proportion as is appropriate to reflect the relative benefits
received by the Company, the Selling Stockholder and the Parent on the one hand
and by the International Underwriters on the other from the offering of the
International Securities; PROVIDED, HOWEVER, that in no case shall any
International Underwriter (except as may be provided in any agreement among
underwriters relating to the offering of the International Securities) be
responsible for any amount in excess of the underwriting discount or commission
applicable to the Securities purchased by such International Underwriter
hereunder. If the allocation provided by the immediately preceding sentence is
unavailable for any reason, the Company, the Selling Stockholder and the Parent,
jointly and severally, and the International
23
Underwriters shall contribute in such proportion as is appropriate to reflect
not only such relative benefits but also the relative fault of the Company,
the Selling Stockholder and the Parent on the one hand and of the
International 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, the Selling
Stockholder and the Parent shall be deemed to be equal to the total net
proceeds from the offering (before deducting expenses), and benefits received
by the International 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 International Prospectus. Relative fault shall be
determined by reference to whether any alleged untrue statement or omission
relates to information provided by the Company, the Selling Stockholder, the
Parent or the International Underwriters. The Company, the Selling
Stockholder, the Parent and the International 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 (d), 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 International Underwriter within the meaning of either the
Act or the Exchange Act and each director, officer, employee and agent of an
International Underwriter shall have the same rights to contribution as such
International 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
(d).
9. DEFAULT BY AN INTERNATIONAL UNDERWRITER. If any one or more
International Underwriters shall fail to purchase and pay for any of the
International Securities agreed to be purchased by such International
Underwriter or International Underwriters hereunder and such failure to purchase
shall constitute a default in the performance of its or their obligations under
this Agreement, the remaining International Underwriters shall be obligated
severally to take up and pay for (in the respective proportions which the amount
of International Securities set forth opposite their names in Schedule I hereto
bears to the aggregate amount of International Securities set forth opposite the
names of all the remaining International Underwriters) the International
Securities which the defaulting International Underwriter or International
Underwriters agreed but failed to purchase; PROVIDED, HOWEVER, that in the event
that the aggregate amount of International Securities which the defaulting
International Underwriter or International Underwriters agreed but failed to
purchase shall exceed 10% of the aggregate amount of International Securities
set forth in Schedule I hereto, the remaining International Underwriters shall
have the right to purchase all, but shall not be under any obligation to
purchase any, of the International Securities, and if such nondefaulting
International Underwriters do not purchase all the International Securities,
this Agreement will terminate without liability to any nondefaulting
International Underwriter, the Selling Stockholder, the Parent or the
24
Company. In the event of a default by any International Underwriter as set
forth in this Section 9, the Closing Date shall be postponed for such period,
not exceeding seven days, as the International Representatives shall
determine in order that the required changes in the Registration Statement
and the Prospectuses or in any other documents or arrangements may be
effected. Nothing contained in this Agreement shall relieve any defaulting
International Underwriter of its liability, if any, to the Company, the
Selling Stockholder, the Parent and any nondefaulting International
Underwriter for damages occasioned by its default hereunder.
10. EFFECTIVE DATE OF AGREEMENT AND TERMINATION. This Agreement
shall become effective at such time (after notification of the effectiveness of
the Registration Statement has been released by the Commission) as the
International Underwriters, the Selling Stockholder and the Company shall agree
on the initial public offering price and underwriting discount per share, unless
prior to such time such of the International Underwriters as have agreed to
purchase in the aggregate 50% or more of the International Securities shall have
given notice to the Company that such Underwriters elect that this Agreement
shall not become effective; PROVIDED, HOWEVER, that the provisions of this
Section 10 and of Section 8 hereof shall at all times be effective. If this
Agreement shall not have become effective prior to 5:00 PM, New York City time,
on the seventh full business day after the Effective Date, this Agreement shall
not thereafter become effective unless such period is extended by agreement
among the International Underwriters, the Selling Stockholder and the Company.
This Agreement shall be subject to termination in the absolute
discretion of the International Representatives, by notice given to the Company
prior to delivery of and payment for the International Securities, if prior to
such time (i) trading in the Company's Common Stock shall have been suspended by
the Commission or the New York Stock Exchange or trading in securities generally
on the New York Stock Exchange shall have been suspended or limited or minimum
prices shall have been established on such Exchange, (ii) a banking moratorium
shall have been declared either by Federal or New York or Oklahoma 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 judgment of the International Representatives, impracticable or
inadvisable to proceed with the offering or delivery of the Securities as
contemplated by the International 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 Stockholder, of the Parent and of the
International 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 International Underwriter, the Selling Stockholder, the Parent or
the Company or any of the officers, directors or controlling persons referred to
in Section 8 hereof, and will survive delivery of and payment for the
International Securities. The provisions of Sections 7 and 8 hereof shall
survive the termination or cancelation of this Agreement.
25
12. NOTICES. All communications hereunder will be in writing and
effective only on receipt, and, if sent to the International Representatives,
will be mailed, delivered or telegraphed and confirmed to them, care of Salomon
Brothers International Limited, attention of the Syndicate Desk, at Victoria
Plaza, 000 Xxxxxxxxxx Xxxxxx Xxxx, Xxxxxx XX0X 0XX XXXXXXX; or, if sent to the
Company, will be mailed, delivered or telecopied to 000-000-0000 or telegraphed
and confirmed to it at 00000 Xxxxx Xxxxxxx Xxxxxxx, Xxxxx 000, Xxxxxxxx Xxxx, XX
00000, attention of the legal department; or if sent to the Selling Stockholder,
will be mailed, delivered or telecopied to 000-000-0000 or telegraphed and
confirmed to it at 0000 Xxxxxxxxxx Xxxx, Xxxxx 000X Xxxxxxx Xxxxxxxx,
Xxxxxxxxxx, Xxxxxxxx 00000, attention of the President; or if sent to the
Parent, will be mailed, delivered or telegraphed and confirmed to it at 87
Avenue de la Grande Armee, 75782 Xxxxx Xxxxx 00, Xxxxxx.
13. SUCCESSORS. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective successors and the officers
and directors 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.
15. Jurisdiction; Appointment of Agent for Service of Process. The
Parent agrees that any legal suit, action or proceeding brought, by any party to
this Agreement or their respective successors or the directors, officers,
employees, agents and controlling persons referred to in Section 8 hereof,
against it arising out of or based upon its alleged breach of, or failure to
perform, any obligation under this Agreement or the transactions contemplated
hereby may be instituted in any State or Federal court sitting in The City of
New York and any appellate court from any thereof, and waives any objection
which it may now or hereafter have to the laying of venue of any such
proceeding, and irrevocably submits to the nonexclusive jurisdiction of such
courts in any suit, action or proceeding. The Parent has appointed CT
Corporation, New York, New York, as its authorized agent (the "Authorized
Agent") upon whom process may be served in any legal suit, action or proceeding
arising out of or based upon this Agreement or the transactions contemplated
hereby which may be instituted in any State or Federal court sitting in The City
of New York and any appellate court from any thereof, by any person and
expressly accepts the nonexclusive jurisdiction of any such court in respect of
any such action. Such appointment shall be irrevocable. The Parent hereby
represents and warrants that the Authorized Agent has agreed to act as said
agent for service of process, and agrees to take any and all action, including
the filing of any and all documents and instruments, that may be necessary to
continue such appointment in full force and effect as aforesaid. Service of
process upon the Authorized Agent and written notice of such service to the
Parent shall be deemed, in every respect, effective service of process upon the
Parent.
26
16. 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.
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
Company, the Selling Stockholder, the Parent and the several International
Underwriters.
Very truly yours,
XXXXX XXXXXXX NATURAL GAS CORP.,
by
-------------------------------------
Name:
Title:
XXXXX XXXXXXX NATURAL GAS HOLDINGS CORP.,
by
-------------------------------------
Name:
Title:
S.A. XXXXX XXXXXXX ET CIE,
by
-------------------------------------
Name:
Title:
27
The foregoing Agreement is hereby
confirmed and accepted as of the
date first above written.
Salomon Brothers International Limited
Credit Suisse First Boston (Europe) Limited
Howard, Weil, Labouisse, Xxxxxxxxxx Incorporated
Xxxxxx Xxxxxxx & Co. International Limited
By: Salomon Brothers International Limited,
by
--------------------------------------
Name:
Title:
For themselves and the other
several International Underwriters
named in Schedule I to the
foregoing Agreement.
EXHIBIT A
XXXXX XXXXXXX NATURAL GAS CORP.
PUBLIC OFFERING OF COMMON STOCK
, 1997
Salomon Brothers International Limited
Credit Suisse First Boston (Europe) Limited
Howard, Weil, Labouisse, Xxxxxxxxxx Incorporated
Xxxxxx Xxxxxxx & Co. International Limited
As International Representatives of the several International Underwriters,
c/o Salomon Brothers International Limited
Victoria Plaza
000 Xxxxxxxxxx Xxxxxx Xxxx
Xxxxxx XX0X XXX XXXXXXX
Dear Sirs:
This letter is being delivered to you in connection with the proposed
International Underwriting Agreement (the "International Underwriting
Agreement"), among Xxxxx Xxxxxxx Natural Gas Corp., an Oklahoma corporation (the
"Company"), Xxxxx Xxxxxxx Natural Gas Holdings Corp., a Delaware corporation,
S.A. Xxxxx Xxxxxxx et Cie and you as representatives of a group of International
Underwriters named therein, relating to an underwritten public offering of
Common Stock, $.01 par value (the "Common Stock"), of the Company.
In order to induce you and the other International Underwriters to
enter into the International Underwriting Agreement, the undersigned agrees not
to offer, sell, contract to sell, pledge, or otherwise dispose of or enter into
any transaction which is designed to, or could be expected to, result in the
disposition by any person, directly or indirectly, or announce the offering 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 or any securities
convertible into or exercisable or exchangeable for such capital stock, or
announce an intention to effect any such transaction, for a period of 90 days
following the day on which the International Underwriting Agreement is executed,
without your prior written consent.
2
If, for any reason, the International Underwriting Agreement shall be
terminated prior to the Closing Date (as defined in the International
Underwriting Agreement), the agreement set forth above shall likewise be
terminated.
Yours very truly,
[Signature of executive
officer or director of Company]
By:
-------------------------------------
Name:
Title:
Address:
