EXHIBIT 1.1
EXECUTION COPY
-------------
$600,000,000
XXXXX-ILLINOIS, INC.
$300,000,000 7.85% Senior Notes due 2004
$300,000,000 8.10% Senior Notes due 2007
UNDERWRITING AGREEMENT
May 13, 1997
May 13, 1997
XXXXXX XXXXXXX & CO.
INCORPORATED
BT SECURITIES CORPORATION
CREDIT SUISSE FIRST BOSTON CORPORATION
NATIONSBANC CAPITAL MARKETS, INC.
SALOMON BROTHERS INC
c/o MORGAN XXXXXXX & CO.
INCORPORATED
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs and Mesdames:
Xxxxx-Illinois, Inc., a Delaware corporation (the "Company"), proposes
to issue and sell to the several Underwriters named in Schedule I hereto (the
"Underwriters") $300,000,000 principal amount of its 7.85% Senior Notes due 2004
(the "7-Year Notes") and $300,000,000 principal amount of its 8.10% Senior Notes
due 2007 (the "10-Year Notes" and, together with the 7-Year Notes, the
"Securities") to be issued pursuant to the provisions of an Indenture dated as
of May 16, 1997 (the "Indenture") by and between the Company and The Bank of New
York, as Trustee (the "Trustee").
The Company has prepared and filed with the Securities and Exchange
Commission (the "Commission") a registration statement on Form S-3 (File No.
333-25175), which registration statement also constitutes, pursuant to Rule 429
under the Securities Act of 1933, as amended (the "Securities Act"),
Post-Effective Amendment No. 1 to the Registration Statement (File No.
33-51982), as amended, relating to the Securities and the offering thereof from
time to time in accordance with Rule 415 under the Securities Act. Such
registration statements, as amended, have been declared effective by the
Commission, and the Indenture has been qualified under the Trust Indenture Act
of 1939, as amended (the "Trust Indenture Act"). In addition, the Company has
prepared and filed with the Commission the Preliminary Prospectus (as defined
herein) pursuant to Rule 424(b) under the Securities Act in accordance with Rule
424(b) under the Securities Act.
The terms which follow, when used in this Agreement, shall have the
meanings indicated. The term "the Effective Date" shall mean each date that the
Registration Statement and any post-effective amendment or amendments thereto
became or become effective. "Execution Time" shall mean the date and time that
this Agreement is executed and delivered by the parties hereto. "Preliminary
Prospectus" shall mean any preliminary prospectus, including any preliminary
prospectus supplement, used in connection with the offer of any Securities prior
to the date hereof and any preliminary prospectus included in the Registration
Statement at the Effective Date that omits Rule 430A Information (as defined
herein). "Prospectus" shall mean the prospectus, including any prospectus
supplement relating to the Securities, that is first filed pursuant to
Rule 424(b) after the Execution Time or, if no filing pursuant to Rule 424(b) is
required, shall mean the form of final prospectus relating to the Securities
included in the Registration Statement at the Effective Date. "Registration
Statement" shall mean the registration statements referred to above, including
incorporated documents 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 becomes
effective prior to the Closing Date (as defined herein), shall also mean such
registration statements as so amended. Such term shall include any Rule 430A
Information deemed to be included therein as provided by Rule 430A. "Rule 430A
Information" means information with respect to the Securities and the offering
thereto permitted to be omitted from the Registration Statement when it becomes
effective pursuant to Rule 430A. Any reference herein to the Registration
Statement, a Preliminary Prospectus or the Prospectus shall be deemed to refer
to and include the documents incorporated by reference therein pursuant to
Item 12 of Form S-3 which were filed under the Securities and Exchange Act of
1934, as amended (the "Exchange Act") on or before the Effective Date of the
Registration Statement or the issue date of such Preliminary Prospectus or the
Prospectus, as the case may be; and any reference herein to the terms "amend",
"amendment" or "supplement" with respect to the Registration Statement, any
Preliminary Prospectus or the Prospectus 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 any Preliminary Prospectus or
the Prospectus, as the case may be, deemed to be incorporated therein by
reference.
1. REPRESENTATIONS AND WARRANTIES. (a) The Company represents and
warrants, as of the date hereof and as of the Closing Date, to and agrees with
each of the Underwriters as follows:
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(i) The Company meets the requirements for use of Form S-3 under
the Securities Act. The Registration Statement, at the time the Registration
Statement became effective, as of the Closing Date and as amended or
supplemented, if applicable, and the Prospectus, when it is first filed in
accordance with Rule 424(b) under the Securities Act and on the Closing Date,
complied and will comply, as the case may be, in all material respects with
the requirements of the Securities Act and the applicable rules and
regulations of the Commission thereunder.
(ii) The Registration Statement has become effective; no stop
order suspending the effectiveness of the Registration Statement is in effect
and no proceedings for such purpose are pending before or threatened by the
Commission; and any required filing of the Prospectus pursuant to Rule 424(b)
under the Securities Act has been made in accordance with Rule 424(b) under
the Securities Act.
(iii) The Registration Statement, at the time the Registration
Statement became effective, as amended or supplemented (or, if an amendment
to the Registration Statement or an annual report on Form 10-K has been filed
by the Company with the Commission subsequent to the Effective Date, then at
the time of the most recent such filing) did not 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 not misleading. The
Prospectus, at the time the Registration Statement became effective, as
amended or supplemented and as of the Closing Date, did not and will not
contain an untrue statement of a material fact or omit to state a material
fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided, however,
that the representations and warranties in this subsection shall not apply
(A) to statements in or omissions from the Registration Statement or
Prospectus made in reliance upon and in conformity with information furnished
to the Company in writing by any of you expressly for use in the Registration
Statement or Prospectus or (B) to that part of the Registration Statement
which shall constitute the Statement of Eligibility and Qualification under
the Trust Indenture Act (Form T-1) of the Trustee under the Indenture.
(iv) The documents incorporated by reference in the Registration
Statement and Prospectus, as amended or supplemented, if applicable, at the
time they were or hereafter are filed with the Commission, complied
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and will comply in all material respects with the requirements of the
Exchange Act and the rules and regulations of the Commission thereunder
and, when read together with the other information in the Prospectus, at
the time the Registration Statement and any amendments thereto became or
become effective and at the Closing Date, did not and will not contain an
untrue statement of a material fact and will not omit to state a material
fact required to be stated therein or necessary in order to make the
statements therein, in the light of the circumstances under which they are
made, not misleading.
(v) Each of Ernst & Young LLP ("Ernst & Young"), K.P.M.G. S.p.A. and
Xxxxxx Xxxxxxxx S.p.A., who are reporting upon the audited financial
statements and schedules included or incorporated by reference in the
Registration Statement and the Prospectus, each as amended or supplemented,
if applicable, are independent public accountants as required by the
Securities Act.
(vi) (A) The consolidated financial statements and the related notes
of the Company included or incorporated by reference in the Registration
Statement and the Prospectus, or in any supplement thereto or amendment
thereof, present fairly the consolidated financial position of the Company
and its subsidiaries, considered as one enterprise, as of the dates
indicated and the consolidated results of operations and changes in
financial position of the Company and its subsidiaries, considered as one
enterprise, for the periods specified; (B) such financial statements and
related notes have been prepared in conformity with generally accepted
accounting principles applied on a consistent basis throughout the periods
involved; and (C) the financial statement schedules incorporated by
reference in the Registration Statement present fairly the information
required to be stated therein.
(vii) The pro forma financial statements contained in the Preliminary
Prospectus and the Prospectus under the heading "Unaudited Pro Forma
Consolidated Financial Information" have been prepared on a basis
consistent with the historical statements referred to in (vi) above, except
for the pro forma adjustments specified therein, and (A) include all
material adjustments to the historical financial data required by Rule
11-02 of Regulation S-X necessary to reflect the AVIR Acquisition and the
Refinancing (each as defined in the Preliminary Prospectus or the
Prospectus), (B) give effect to the assumptions made on a reasonable basis,
(C) present fairly in all material respects in accordance with generally
accepted accounting
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principles consistently applied throughout such periods, the historical and
proposed transactions contemplated by the Preliminary Prospectus and the
Prospectus and (D) comply in all material respects with the requirements of
Rules 11-01 and 11-02 of Regulation S-X; and the other pro forma financial
information and pro forma financial data set forth in the Prospectus under
the captions "Summary -- Summary Historical and Pro Forma Financial Data"
and "Consolidated Capitalization" are derived from such "Unaudited Pro
Forma Consolidated Financial Information."
(viii) The Company has been duly incorporated, is validly existing as a
corporation in good standing under the laws of the State of Delaware, has
the corporate power and authority to own its property and to conduct its
business as described in the Prospectus and is duly qualified to transact
business and is in good standing in each jurisdiction in which the conduct
of its business or its ownership or leasing of property requires such
qualification, except to the extent that the failure to be so qualified or
be in good standing would not, individually or in the aggregate, have a
material adverse effect on the condition (financial or otherwise),
properties, assets, business or results of operations of the Company and
its subsidiaries, considered as one enterprise (a "Material Adverse
Effect").
(ix) Each subsidiary of the Company that is a "Significant Subsidiary"
(as defined in Rule 1-02 of Regulation S-X under the Securities Act)
(hereinafter a "Significant Subsidiary") has been duly incorporated, is
validly existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, has the corporate power and authority to
own its property and to conduct its business as described in the Prospectus
and is duly qualified to transact business and is in good standing in each
jurisdiction in which the conduct of its business or its ownership or
leasing of property requires such qualification, except to the extent that
the failure to be so qualified or be in good standing would not have a
Material Adverse Effect.
(x) All of the issued and outstanding shares of capital stock of the
Company have been duly authorized and are validly issued, fully paid and
non-assessable.
(xi) All of the issued and outstanding capital stock of each
Significant Subsidiary of the Company (including Xxxxx-Illinois Group,
Inc., a Delaware corporation and a wholly-owned subsidiary of the
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Company) has been duly authorized, is validly issued, fully paid and
non-assessable and, except as set forth in Schedule II hereto, is owned by
the Company, directly or through one or more subsidiaries of the Company,
free and clear of any material lien.
(xii) There are no holders of securities (debt or equity) of the
Company, or holders of rights (including preemptive rights), warrants or
options to obtain securities of the Company, who have the right to request
the Company to register securities held by them under the Securities Act,
except for the Registration Rights Agreement dated as of March 17, 1986 by
and among OII Holdings Corporation (the predecessor in interest to the
Company), KKR Partners II, L.P., OII Associates, L.P., OII Associates II,
L.P. and KKR Associates, L.P.
(xiii) The Company has the corporate power and authority to execute,
deliver and perform its obligations under this Agreement; the execution and
delivery of, and the performance by the Company of its obligations under,
this Agreement have been authorized by all necessary corporate action of
the Company; and this Agreement has been duly executed and delivered by the
Company.
(xiv) The Company has the corporate power and authority to execute and
deliver the Indenture and to perform its obligations provided for therein;
the Indenture has been duly qualified under the Trust Indenture Act and has
been duly authorized by the Company substantially in the form filed as an
exhibit to the Registration Statement and, when executed and delivered by
the Company and assuming due execution and delivery by the Trustee, will be
a legal, valid and binding agreement of the Company, enforceable against
the Company in accordance with its terms except as the enforceability
thereof may be limited by bankruptcy, insolvency, reorganization or other
similar laws affecting creditors' rights generally and as rights of
acceleration and the availability of equitable remedies may be limited by
equitable principles of general applicability (whether enforcement is
considered in a proceeding in equity or at law); and the Indenture conforms
in all material respects to the description thereof contained in the
Prospectus.
(xv) The Company has the corporate power and authority to execute,
issue and deliver the Securities and to incur and perform its obligations
provided for therein; the Securities have been duly authorized and, when
executed, issued and authenticated in accordance
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with the provisions of the Indenture and delivered to and paid for by the
Underwriters in accordance with the terms of this Agreement, will be
entitled to the benefits of the Indenture and will be legal, valid and
binding obligations of the Company, enforceable against the Company in
accordance with their respective terms, except as the enforceability
thereof may be limited by bankruptcy, insolvency, reorganization or other
similar laws affecting creditors' rights generally and as rights of
acceleration, if any, and the availability of equitable remedies may be
limited by equitable principles of general applicability (whether
enforcement is considered in a proceeding in equity or at law); and the
Securities conform in all material respects to the descriptions thereof
contained in the Prospectus.
(xvi) Since the respective dates as of which information is given in
the Registration Statement and the Prospectus, except as otherwise stated
therein, contemplated thereby or otherwise incorporated by reference
therein, there has not been (A) any material adverse change in the
condition (financial or otherwise), properties, assets, business, or
results of operations of the Company and its subsidiaries, considered as
one enterprise, whether or not arising in the ordinary course of business
(a "Material Adverse Change"), (B) any transaction entered into by the
Company or any of its subsidiaries, other than in the ordinary course of
business, that could have a Material Adverse Effect, or (C) any dividend or
distribution of any kind declared, paid or made by the Company on its
capital stock.
(xvii) Neither the Company nor any of its subsidiaries is (A) in
violation of its certificate of incorporation or by-laws or in default (nor
has an event occurred that with notice or passage of time or both would
constitute such a default) in the performance or observance of any
obligation, agreement, covenant or condition contained in any indenture,
mortgage, deed of trust, loan or credit agreement, note, lease or other
material agreement or instrument to which the Company or its subsidiaries
is subject or by which any of them or any of their properties or assets may
be bound or affected, (B) in violation of any existing applicable law,
ordinance, regulation, judgment, order or decree of any government,
governmental instrumentality, arbitrator or court, domestic or foreign,
having jurisdiction over the Company or any of its subsidiaries or any of
their properties or assets or (C) in each case to the knowledge of the
Company, in violation of or has
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violated any permit, certificate, license, order or other approval or
authorization required in connection with the operation of its business
that, with respect to each of clause (A), (B) and (C) of this paragraph,
would (individually or in the aggregate) (I) adversely affect the legality,
validity or enforceability of this Agreement, the Indenture or the
Securities, (II) have a Material Adverse Effect or (III) impair the ability
of the Company to fully perform on a timely basis any obligations that it
has under this Agreement, the Indenture or the Securities.
(xviii) The issuance, sale and delivery of the Securities, the execution,
delivery and performance by the Company of this Agreement and the
Indenture, the compliance by the Company with the terms herein and therein
and the consummation by the Company of the transactions contemplated
hereby, thereby and in the Registration Statement and the Prospectus, do
not and will not result in a violation of any of the terms or provisions of
the certificate of incorporation or by-laws of the Company or any of its
subsidiaries, and (A) will not, as of the Closing Date, conflict with, or
result in a breach or violation of any of the terms or provisions of, or
constitute a default under, any indenture, mortgage, deed of trust, loan or
credit agreement, note, lease or other material agreement or instrument to
which the Company or any of its subsidiaries is a party or by which any of
them or any of their properties or assets is bound, except for such
conflicts, breaches, violations or defaults that would not have a Material
Adverse Effect or (B) do not and will not conflict with or result in a
breach or violation of any existing applicable law, rule, regulation,
judgment, order or decree of any government, governmental instrumentality
or court, domestic or foreign, having jurisdiction over the Company or any
of its subsidiaries or any of their properties or assets, except for any
conflict, breach or violation that would not have a Material Adverse
Effect.
(xix) No authorization, approval, consent or order of, or qualification
with, any governmental body or agency is required to be obtained or made by
the Company for (A) the due authorization, execution, delivery and
performance by the Company of this Agreement and the Indenture or the valid
authorization, issuance, sale and delivery of the Securities, except (I)
such as may be required by the securities or blue sky laws of the various
states (the "Blue Sky laws") in connection with the offer and sale of the
Securities and (II) for such consents that are required and have
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been received and are in full force and effect as of the Closing Date.
(xx) There is no action, suit, investigation or proceeding before or
by any government, governmental instrumentality or court, domestic or
foreign, now pending or, to the knowledge of the Company, threatened,
against or affecting the Company or any of its subsidiaries or any of their
properties and assets that (A) is required to be disclosed in the
Prospectus and is not so disclosed, (B) except as disclosed in the
Prospectus, could result in any Material Adverse Change, (C) seeks to
restrain, enjoin, prevent the consummation of or otherwise challenge the
issuance and sale of the Securities or the execution and delivery of this
Agreement or the Indenture or any of the transactions contemplated hereby
or thereby or (D) questions the legality or validity of any such
transaction or seeks to recover damages or obtain other relief in
connection with any such transaction, and, in each case to the knowledge of
the Company, there is no valid basis for any such action, suit,
investigation or proceeding; the aggregate of all pending legal or
governmental proceedings to which the Company or any of its subsidiaries is
a party or that affect any of their properties and assets that are not
described in the Registration Statement or the Prospectus, including
ordinary routine litigation incidental to its business, would not have a
Material Adverse Effect.
(xxi) There are no statutes, regulations, contracts or other documents
that are required to be described in the Registration Statement or the
Prospectus or to be filed as exhibits to the Registration Statement that
are not described or filed as required or, in the case of exhibits, will
not be so filed promptly after the Closing Date.
(xxii) Each of the Company and its subsidiaries has good title to all
properties owned by them, in each case free and clear of all liens except
(A) as do not materially interfere with the use made and proposed to be
made of such properties, (B) as set forth in the Registration Statement and
the Prospectus or (C) as could not reasonably be expected to have a
Material Adverse Effect.
(xxiii) Each of the Company and its subsidiaries has all necessary
consents, authorizations, approvals, orders, certificates and permits of
and from, and has made all declarations and filings with, all federal,
state, local, foreign and other governmental authorities, all
self-regulatory organizations and all
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courts and other tribunals, to own, lease, license and use its properties
and assets and to conduct its business in the manner described in the
Registration Statement or the Prospectus, except to the extent that the
failure to so obtain or file would not have a Material Adverse Effect.
(xxiv) Each of the Company and its subsidiaries owns or possesses, or
can acquire on reasonable terms, adequate patents, patent rights, licenses,
inventions, copyrights, know-how (including trade secrets and other
proprietary or confidential information, systems or procedures, whether
patented or unpatented), trademarks, service marks and trade names
(collectively, "Intellectual Property") presently employed by them in
connection with the business now operated by them, except where the failure
to own or possess or have the ability to acquire any such Intellectual
Property would not have a Material Adverse Effect, and neither the Company
nor any of its subsidiaries has received any notice of infringement of or
conflict with asserted rights of others with respect to any of the
foregoing that, individually or in the aggregate, if the subject of an
unfavorable decision, ruling or finding, would result in any Material
Adverse Change.
(xxv) Except as disclosed in the Registration Statement and the
Prospectus, each of the Company and its subsidiaries is in material
compliance with all applicable existing federal, state, local and foreign
laws and regulations relating to protection of human health, safety and the
environment or imposing liability or standards of conduct concerning any
Hazardous Material (as hereinafter defined) ("Environmental Laws"), except,
in each case, where such noncompliance, individually or in the aggregate,
would not have a Material Adverse Effect. The term "Hazardous Material"
means (A) any "hazardous substance" as defined by the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, as amended,
(B) any "hazardous waste" as defined by the Resource Conservation and
Recovery Act, as amended, (C) any petroleum or petroleum product,
(D) any polychlorinated biphenyl and (E) any pollutant or contaminant or
hazardous, dangerous or toxic chemical, material, waste or substance
regulated under or within the meaning of any other Environmental Law.
(xxvi) The Company has not taken and will not take, directly or
indirectly, any action designed to or that might be reasonably expected to,
cause or result in stabilization or manipulation of the price of the
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Securities or any action resulting in a violation of Regulation M under the
Exchange Act.
(xxvii) The Securities are, or will be when issued, "excepted securities"
within the meaning of Rule 101(c) of Regulation M under the Exchange Act.
(xxviii) The Company is not an "investment company" as such term is
defined in the Investment Company Act of 1940, as amended (the "1940 Act").
(xxix) The Company has complied with all provisions of Section 517.075,
Florida Statutes relating to doing business with the Government of Cuba or
with any person or affiliate located in Cuba.
(b) Any certificate signed by any officer of either the Company or any
of its subsidiaries and delivered to you or to your counsel at the Closing Date
pursuant to this Agreement or the transactions contemplated hereby shall be
deemed a representation and warranty by the Company or such subsidiary of the
Company, as the case may be, to each of you as to the matters covered thereby.
2. AGREEMENT TO SELL AND PURCHASE. The Company hereby agrees, subject
to the terms and conditions set forth herein, to sell to the several
Underwriters, and, upon the basis of the representations and warranties herein
contained and subject to the conditions hereinafter stated, each Underwriter
agrees, severally and not jointly, to purchase from the Company (A) the
respective principal amounts of 7-Year Notes set forth in Schedule I hereto
opposite its name at 98.753% of their respective principal amounts (the "7-Year
Note Purchase Price") plus accrued interest, if any, from May 15, 1997 to the
date of payment and delivery, calculated on the basis of a 360-day year of
twelve 30-day months and (B) the respective principal amounts of 10-Year Notes
set forth in Schedule I hereto opposite its name at 98.490% of their respective
principal amounts (the "10-Year Note Purchase Price") plus accrued interest, if
any, from May 15, 1997 to the date of payment and delivery, calculated on the
basis of a 360-day year of twelve 30-day months.
3. TERMS OF PUBLIC OFFERING. The Company has been advised by you that
the Underwriters propose to make a public offering of their respective portions
of the Securities as soon after this Agreement has become effective as in your
judgment is advisable. The Company is further advised by you that (A) the
7-Year Notes are to be offered to the public initially at 99.878% of their
principal amount (the "7-Year Note Public Offering Price") plus accrued
interest, if any, from May 15, 1997 to the date of payment and delivery and to
certain dealers selected by you at a
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price that represents a concession not in excess of 0.50% of their principal
amount under the 7-Year Note Public Offering Price, and that any Underwriter may
allow, and such dealers may reallow, a concession, not in excess of 0.25% of
their principal amount, to any Underwriter or to certain other dealers and (B)
the 10-Year Notes are to be offered to the public initially at 99.865% of their
principal amount (the "10-Year Note Public Offering Price") plus accrued
interest, if any, from May 15, 1997 to the date of payment and delivery and to
certain dealers selected by you at a price that represents a concession not in
excess of 0.60% of their principal amount under the 10-Year Note Public Offering
Price, and that any Underwriter may allow, and such dealers may reallow, a
concession, not in excess of 0.25% of their principal amount, to any Underwriter
or to certain other dealers.
4. PAYMENT AND DELIVERY. Payment for the 7-Year Notes and the 10-Year
Notes shall be made to the Company by wire transfer in federal funds or other
funds immediately available in New York City or through the facilities of The
Depository Trust Company of the 7-Year Note Purchase Price and of the 10-Year
Note Purchase Price against delivery of such Securities for the respective
accounts of the several Underwriters at 10:00 A.M., New York City time, on May
16, 1997, or at such other time on the same or such other date, not later than
May 22, 1997, as shall be designated in writing by you. The time and date of
such payment are hereinafter referred to as the "Closing Date."
Payment for the Securities shall be made against delivery to you for
the respective accounts of the several Underwriters of global certificates
representing the 7-Year Notes and the 10-Year Notes registered in the name of
Cede & Co. with any transfer taxes payable in connection with the transfer of
the Securities to the Underwriters duly paid.
The Company agrees to have the global certificates referred to above
available for inspection and checking by Xxxxxx Xxxxxxx & Co. Incorporated in
New York, New York, not later than 1:00 P.M., New York City time on the business
day prior to the Closing Date.
5. CONDITIONS TO THE UNDERWRITERS' OBLIGATIONS. The several
obligations of the Underwriters to purchase and pay for the Securities pursuant
to this Agreement are subject to the satisfaction of each of the following
conditions:
(a) Subsequent to the execution and delivery of this Agreement and
prior to the Closing Date:
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(i) (A) no downgrading shall have occurred in the rating
accorded any of the Company's debt securities or preferred stock by
any "nationally recognized statistical rating organization" as that
term is defined by the Commission for purposes of Rule 436(g)(2) under
the Securities Act and regulations thereunder and (B) no such
organization shall have publicly announced that it has under
surveillance or review, with possible negative implications, its
rating of the Company's debt securities or preferred stock.
(ii) no stop order suspending the effectiveness of the
egistration Statement is in effect and no proceedings for that
urpose shall have been instituted and shall be pending or, to your
nowledge or the knowledge of the Company, shall be contemplated by
he Commission, and any request on the part of the Commission for
dditional information shall have been complied with to the
atisfaction of your counsel.
(b) The Company shall have furnished to the Underwriters a certificate
of the Company, signed by the Chairman of the Board or the President or a
Vice President and the Treasurer or Controller of the Company, dated the
Closing Date, to the effect 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 in all material respects with all the
agreements and satisfied all the conditions on its part to be
performed or satisfied at or prior to the Closing Date;
(ii) no stop order suspending the effectiveness of the
Registration Statement is in effect 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 Registration Statement and the Prospectus, there has
been no Material Adverse Change.
(c) The Underwriters shall have received on the Closing Date an
opinion of Xxxxxx & Xxxxxxx, outside counsel for the Company, dated the
Closing Date, in
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form and substance reasonably satisfactory to your counsel to the effect
that:
(i) the Registration Statement and the Prospectus (excluding the
documents incorporated therein by reference) comply as to form in all
material respects with the requirements for registration statements on
Form S-3 under the Securities Act and the rules and regulations of the
Commission thereunder; it being understood, however, that such counsel
expresses no opinion with respect to the financial statements,
schedules and other financial and statistical data included or
incorporated in the Registration Statement or the Prospectus or with
respect to the Statement as to the Eligibility and Qualification of
the Trustee on Form T-1. In passing upon the compliance as to form of
the Registration Statement and the Prospectus, such counsel has
assumed that the statements made therein (or incorporated by reference
therein) are correct and complete;
(ii) the Registration Statement has become effective under the
Securities Act and, to the best of such counsel's knowledge, no stop
order suspending the effectiveness of the Registration Statement has
been issued under the Securities Act and no proceedings therefor have
been initiated or threatened by the Commission; and any required
filing of the Prospectus pursuant to Rule 424(b) under the Securities
Act has been made in accordance with Rule 424(b) under the Securities
Act;
(iii) the Company has been duly incorporated and is validly
existing and in good standing under the laws of the State of Delaware,
with corporate power and authority to own or lease its property and to
conduct its business as described in the Registration Statement and
the Prospectus;
(iv) the Underwriting Agreement has been duly authorized,
executed and delivered by the Company;
(v) the Indenture has been (A) duly qualified under the Trust
Indenture Act and (B) duly authorized, executed and delivered by the
Company and, assuming the due authorization, execution and delivery by
the Trustee, will be a legally valid and binding agreement of the
Company, enforceable against the Company in accordance with its terms
except (i) as may be
14
limited by the effect of bankruptcy, insolvency, reorganization,
moratorium or other similar laws now or hereafter in effect relating
to or affecting the rights and remedies of creditors, (ii) as may be
limited by the effect of general principles of equity, whether
enforcement is considered in a proceeding in equity or law, and the
discretion of the court before which any proceeding therefor may be
brought; (iii) the enforceability under certain circumstances under
law or court decisions of provisions providing for the indemnification
of or contribution to a party with respect to liability where such
indemnification or contribution is contrary to public policy; (iv)
such counsel shall not be required to express any opinion concerning
the enforceability of the waiver or right or defenses contained in
Section 4.06 of the Indenture; and (v) the manner by which the
acceleration of the Securities may affect the collectibility of that
portion of the stated principal amount thereof which might be
determined to constitute unearned interest thereon;
(vi) the Securities, when executed and authenticated in
accordance with the terms of the Indenture and delivered to and paid
for by the Underwriters in accordance with the terms of this
Agreement, will be legally valid and binding obligations of the
Company, enforceable against the Company in accordance with their
terms except (i) as may be limited by the effect of bankruptcy,
insolvency, reorganization, moratorium or other similar laws now or
hereafter in effect relating to or affecting the rights and remedies
of creditors; (ii) as may be limited by the effect of general
principles of equity, whether enforcement is considered in a
proceeding in equity or law, and the discretion of the court before
which any proceeding therefor may be brought; (iii) the enforceability
under certain circumstances under law or court decisions of provisions
providing for the indemnification of or contribution to a party with
respect to liability where such indemnification or contribution is
contrary to public policy; (iv) such counsel shall not be required to
express any opinion concerning the enforceability of the waiver or
rights or defenses contained in Section 4.06 of the Indenture; and (v)
the manner by which the acceleration of the Securities may affect the
collectibility of that portion of the stated principal amount thereof
15
which might be determined to constitute unearned interest thereon;
(vii) the execution and delivery by the Company of, and the
issuance and sale of the Securities by the Company pursuant to, this
Agreement will not result in (A) the violation by the Company of its
Certificate of Incorporation or Bylaws, the General Corporation Law of
the State of Delaware or any federal or New York statute, or any rule
or regulation that has been issued pursuant to the General Corporation
Law of the State of Delaware or any federal or New York statute known
to such counsel to be applicable to the Company (except that no
opinion shall be expressed with respect to state securities or "blue
sky" laws) or (B) after giving effect to written waivers and consents
which have been or will be obtained on or prior to the Closing, the
breach of or a default under (i) any indenture or other agreement or
instrument pertaining to the Company's long-term debt listed in the
Prospectus Supplement under the caption "Consolidated Capitalization,"
excluding long-term debt listed as "Other," or (ii) any court or
administrative orders, writs, judgments or decrees specifically
directed to the Company and identified to such counsel by an officer
of the Company as material to the Company;
(viii) to such counsel's knowledge, no authorization, approval,
consent or order of, or filing or qualification with, any federal or
New York State court or governmental body or agency is required to be
obtained or made by the Company for the execution and delivery by the
Company of this Agreement and the Indenture or the issuance and sale
of the Securities by the Company, except (A) such as may be required
under state securities or blue sky laws in connection with the
purchase and distribution of the Securities and (B) except such as
have been obtained under the Securities Act and are in full force and
effect as of the Closing Date;
(ix) the statements set forth in the Prospectus under the caption
"Description of the Notes" insofar as such statements constitute
summaries of the documents referred to therein, are accurate in all
material respects; and the Securities conform in all material respects
to the description thereof in the Prospectus; and
16
(x) the Company is not an "investment company," as such term is
defined in the 1940 Act;
In addition, such counsel shall state that, while they did not prepare
any of the documents incorporated by reference in the Registration Statement and
the Prospectus, they have participated in conferences with officers and other
representatives of the Company, representatives of the independent public
accountants for the Company, and the Underwriters' representatives at which the
contents of the Registration Statement and the Prospectus and related matters
were discussed, and although such counsel is not passing upon and does not
assume any responsibility for the accuracy, completeness or fairness of the
statements contained in the Registration Statement and the Prospectus and have
not made any independent check or verification thereof (except as set forth in
paragraph (x) above), during the course of such participation (relying as to
materiality to the extent we deemed appropriate upon the statements of officers
and other representatives of the Company), no facts came to such counsel's
attention that caused such counsel to believe that the Registration Statement
(including the incorporated documents), at the time it became effective,
contained an 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 Prospectus (including the incorporated documents), as
of its date and as of the Closing Date, contained or contains an untrue
statement of a material fact or omitted or omits to state a material fact
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading; it being understood that such
counsel express no belief with respect to the financial statements, schedules
and other financial and statistical data or the Statement of Eligibility of the
Trustee on Form T-1 included or incorporated by reference in the Registration
Statement or the Prospectus.
In rendering such opinion, Xxxxxx & Xxxxxxx may rely as to factual
matters upon certificates or written statements from officers or other
appropriate representatives of the Company or upon certificates of public
officials and need not express any opinion with regard to the laws of any
jurisdiction other than the federal law of the United States, the law of
the State of New York and the General Corporation Law of the State of
Delaware.
(d) At the Closing Date, each of you shall have received a signed
opinion of Xxxxxx X. Xxxxx, Esq., General Counsel of the Company, dated as
of the Closing Date, in form and substance reasonably satisfactory to your
counsel, to the effect that:
17
(i) the Company is duly qualified to transact business and is in
good standing in each jurisdiction in which the conduct of its
business or its ownership or leasing of property requires such
qualification, except to the extent that the failure to be so
qualified or be in good standing would not have a Material Adverse
Effect;
(ii) each Significant Subsidiary (as defined in Rule 1-02 of
Regulation S-X under the Securities Act) of the Company has been duly
incorporated, is validly existing as a corporation in good standing
under the laws of the jurisdiction of its incorporation, has the
corporate power and authority to own its property and to conduct its
business as described in the Prospectus and is duly qualified to
transact business and is in good standing in each jurisdiction in
which the conduct of its business or its ownership or leasing of
property requires such qualifications, except to the extent that the
failure to be so qualified or be in good standing would not have a
Material Adverse Effect;
(iii) the Company has the authorized capitalization as set forth
in the Prospectus, including any amendment or supplement thereto; all
of the issued and outstanding capital stock of each Significant
Subsidiary has been duly authorized and validly issued, is fully paid
and non-assessable and all of the issued and outstanding capital stock
of such Significant Subsidiaries, except as set forth on Schedule II
hereto, is owned of record by the Company, directly or through
subsidiaries, and is free and clear of any material lien, claim,
encumbrance or other security interest;
(iv) the Company has the corporate power and authority to
execute, deliver and perform its obligations under this Agreement; the
execution and delivery of, and the performance by the Company of its
obligations under, this Agreement have been authorized by all
necessary corporate action of the Company; and this Agreement has been
duly executed and delivered by the Company;
(v) the execution and delivery by the Company of, and the
issuance and sale of the Securities by the Company pursuant to, this
Agreement will not result in (A) the violation by the Company of its
Certificate of Incorporation or Bylaws, the General Corporation Law of
the State
18
of Delaware or any federal or Ohio State Statute, or any rule or
regulation that has been issued pursuant to the General Corporation
Law of the State of Delaware or any federal or Ohio State Statute
known to such counsel to be applicable to the Company or any of its
subsidiaries (except that no opinion is expressed with respect to
federal or state securities or "blue sky" laws) (B) after giving
effect to written waivers and consents which have been or will be
obtained on or prior to Closing, the breach of or default under (I)
any indenture or other agreement or instrument binding upon the
Company or any of its subsidiaries that is material to the Company and
its subsidiaries considered as one enterprise or (II) any court or
administrative orders, writs, judgments or decrees known to such
counsel;
(vi) Such counsel has no knowledge of any legal or governmental
proceeding pending or threatened to which the Company or any of its
subsidiaries is a party or to which any of the properties or assets of
the Company or any of its subsidiaries is subject that is required to
be described in the Registration Statement or the Prospectus and is
not so described therein; or of any statutes, regulations, contracts
or other documents that are required to be described in the
Registration Statement or the Prospectus or to be filed as exhibits to
the Registration Statement that are not described or filed as
required; and
(vii) each of the documents incorporated or deemed to be
incorporated by reference in the Registration Statement and the
Prospectus, at the time it was filed with the Commission, complied as
to form in all material respects with the requirements for such
document under the Exchange Act and the regulations thereunder.
In addition, such counsel shall state that he has participated in
conferences with representatives of the Company, representatives of the
independent public accountants for the Company, and the Underwriters'
representatives and counsel at which the contents of the Registration Statement
and the Prospectus and related matters were discussed, and although such counsel
is not passing upon and does not assume any responsibility for the accuracy,
completeness or fairness of the statements contained in the Registration
Statement and the Prospectus, during the course of such participation no facts
came to such counsel's attention that caused such counsel to believe
19
that the Registration Statement (including the incorporated documents), at the
time it became effective, contained an 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 Prospectus, as of its
date and as of the Closing Date, contained or contains an untrue statement of a
material fact or omitted or omits to state a material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; it being understood that such counsel express no belief
with respect to the financial statements, schedules and other financial and
statistical data included or incorporated by reference in the Registration
Statement or the Prospectus.
In rendering such opinion, such counsel may rely as to factual matters upon
certificates or written statements from officers or other appropriate
representatives of the Company or upon certificates of public officials, and
need not express any opinion with respect to the laws of any jurisdiction other
than the federal law of the United States, the law of the State of Ohio and the
General Corporation Law of the State of Delaware.
(e) The Underwriters shall have received on the Closing Date an opinion of
Xxxxxxx Xxxxxxx & Xxxxxxxx, counsel for the Underwriters, dated the Closing
Date, covering certain matters requested by the Underwriters.
(f) At the Closing Date, (i) the Registration Statement and the Prospectus,
as they may then be amended or supplemented, shall contain all statements that
are required to be stated therein under the Securities Act and the regulations
thereunder and in all material respects shall conform to the requirements of the
Securities Act and the regulations thereunder and the Trust Indenture Act and
the regulations thereunder, and neither the Registration Statement nor the
Prospectus, as they may then be amended or supplemented, shall contain an untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein, in the case of the
Prospectus, in the light of the circumstances under which they were made, not
misleading; (ii) there shall not have been, since the respective dates as of
which information is given in the Registration Statement, any Material Adverse
Change, or any development involving a prospective Material Adverse Change,
whether or not arising in the ordinary course of business; (iii) no
20
action, suit or proceeding at law or in equity shall be pending or, to the
knowledge of the Company, threatened against the Company or any of its
subsidiaries that would be required to be set forth in the Prospectus other than
as set forth therein and no proceedings shall be pending or, to the knowledge of
the Company, threatened against it or any of its subsidiaries before or by any
federal, state or other commission, board or administrative agency wherein an
unfavorable decision, ruling or finding could have a Material Adverse Effect,
other than as set forth in the Prospectus; (iv) the Company shall have complied
with all material agreements and satisfied all conditions on its part to be
performed or satisfied at or prior to the Closing Date; and (v) the other
representations and warranties of the Company set forth in Section 1(a) shall be
accurate in all material respects as though expressly made at and as of the
Closing Date.
(g) The Underwriters shall have received on the Closing Date a letter dated
the date hereof or the Closing Date, as the case may be, in form and substance
reasonably satisfactory to the Underwriters, from Ernst & Young, independent
public accountants, containing statements and information of the type ordinarily
included in accountants' "comfort letters" to underwriters with respect to the
financial statements and certain financial information contained in the
Registration Statement and the Prospectus.
(h) By the Closing Date, your counsel shall have been furnished with all
such documents (including any consents under any agreements to which the Company
is a party), certificates and opinions as they may reasonably request for the
purpose of enabling them to pass upon the issuance and sale of the Securities as
contemplated in this Agreement and in Section 5(e) herein and in order to
evidence the accuracy and completeness of any of the representations, warranties
or statements of the Company, the performance of any of the covenants of the
Company, or the fulfillment of any of the conditions herein; and all proceedings
taken by the Company at or prior to the Closing Date in connection with the
authorization, issuance and sale of the Securities, and by the Company at or
prior to the Closing Date in connection with the authorization and delivery of
this Agreement and the Indenture, each as contemplated in this Agreement, shall
be reasonably satisfactory in form and substance to you and to your counsel.
(i) If Securities are to be listed on the New York Stock Exchange (the
"NYSE"), such Securities shall
21
have been duly authorized for listing on the NYSE at or by the Closing Date,
subject only to official notice of issuance thereof and notice of a satisfactory
distribution of the Securities.
(j) Prior to the Closing Date, the Company shall have furnished to Xxxxxx
Xxxxxxx & Co. Incorporated such further information, certificates and documents
as Xxxxxx Xxxxxxx & Co. Incorporated may reasonably request.
(k) On or prior to the Closing Date, the Company shall have (i) completed
the public offering of 14,750,000 shares of its Common Stock, par value $.01, as
contemplated by the Prospectus Supplements dated May 13, 1997 relating thereto
and the accompanying the Prospectus dated April 18, 1997 and (ii) received (A)
the consents of the requisite lenders to release the collateral securing the
Company's 11% Senior Debentures due 2003 and the collateral securing, and
guarantees of, the Company's obligations under the Refinancing Credit Agreement
(the "Credit Agreement"), dated as of November 19, 1996, by and among the
Company, the lenders listed therein, including those named as lead managers and
co-agents, Bank of America National Trust and Savings Association and Bankers
Trust Company, and (B) the consents of such requisite lenders to the issuance of
the Securities.
If any of the conditions specified in this Section 5 shall not have
been fulfilled when and as required by this Agreement, this Agreement may be
terminated by you on notice to the Company at any time at or prior to the
Closing Date, and such termination shall be without liability of any party to
any other party, except as provided in Section 6 herein. Notwithstanding any
such termination, the provisions of Sections 1(a) and 8 herein shall remain in
effect. Notice of such termination shall be given to the Company in writing or
by telephone confirmed in writing.
6. REIMBURSEMENT OF UNDERWRITERS' EXPENSES. If the sale of the
Securities provided for herein is not consummated because any condition to the
obligations of the Underwriters set forth in Section 5 herein is not satisfied,
because of any termination pursuant to Section 10(a) herein or because of any
refusal, inability or failure on the part of the Company to perform any
agreement herein or comply with any provision herein other than by reason of a
default by any of the Underwriters, the Company will reimburse the Underwriters
severally upon demand for all documented out-of-pocket expenses (including fees
and disbursements of counsel) that shall have been incurred by them in
connection with the proposed purchase and sale of the Securities.
22
7. COVENANTS OF THE COMPANY. In further consideration of the
agreements of the Underwriters herein contained, the Company covenants with each
Underwriter as follows:
(a) To prepare the Prospectus, including any amendment or supplement
thereto, in a form approved by the Underwriters and to file such Prospectus
pursuant to Rule 424(b) under the Securities Act not later than the
Commission's close of business on the second business day following the
execution and delivery of this Agreement or, if applicable, such earlier
time as may be required by Rule 430A(a)(3) under the Securities Act; to
make no further amendment or any supplement to the Registration Statement
or to the Prospectus except as permitted herein;
(b) To furnish to each of Xxxxxx Xxxxxxx & Co. Incorporated and its
counsel, without charge, one signed copy of the Registration Statement
(including exhibits thereto) and for delivery to each other Underwriter a
conformed copy of the Registration Statement (without exhibits thereto)
and, during the period mentioned in paragraph (d) below, as many copies of
the Preliminary Prospectus and the Prospectus and any supplements and
amendments thereto or to the Registration Statement as you may reasonably
request.
(c) Before amending or supplementing the Registration Statement or the
Prospectus, to furnish to you a copy of each such proposed amendment or
supplement and not to file any such proposed amendment or supplement to
which you reasonably object.
(d) If, during such period after the first date of the public offering
of the Securities, as in the opinion of counsel for the Underwriters, the
Preliminary Prospectus or the Prospectus is required by law to be delivered
in connection with sales by an Underwriter or a dealer, any event shall
occur or condition exist as a result of which it is necessary to amend or
supplement the Preliminary Prospectus or the Prospectus, as the case may
be, in order to make the statements therein, in the light of the
circumstances when the Preliminary Prospectus or the Prospectus, as the
case may be, is delivered to a purchaser, not misleading, or if, in the
opinion of counsel for the Underwriters, it is necessary to amend or
supplement the Preliminary Prospectus or the Prospectus to comply with
applicable law, forthwith to prepare, file with the Commission and furnish,
at its own expense, to the Underwriters and to the dealers (whose names and
addresses you will furnish to the Company) to which
23
Securities may have been sold by you on behalf of the Underwriters
and to any other dealers upon request, either amendments or supplements to
the Preliminary Prospectus or the Prospectus, as the case may be, so that the
statements therein as so amended or supplemented will not, in the light of
the circumstances when the Preliminary Prospectus or the Prospectus, as the
case may be, is delivered to a purchaser, be misleading or so that the
Preliminary Prospectus or the Prospectus, as amended or supplemented, as the
case may be, will comply with law.
(e) From the date of this Agreement, and for so long as a Preliminary
Prospectus or a Prospectus is required to be delivered in connection with
the sale of Securities covered by this Agreement, the Company will notify
you immediately, and confirm the notice in writing, (i) of the
effectiveness of any amendment to the Registration Statement, (ii) of the
mailing or the delivery to the Commission for filing of any supplement to
the Preliminary Prospectus or the Prospectus or any document to be filed
pursuant to the Exchange Act which will be incorporated by reference into
the Registration Statement, Preliminary Prospectus or the Prospectus, (iii)
of the receipt of any comments from the Commission with respect to the
Registration Statement, the Preliminary Prospectus or the Prospectus, (iv)
of any request by the Commission for any amendment to the Registration
Statement or any amendment or supplement to the Preliminary Prospectus or
the Prospectus or for additional information and (v) of the issuance by the
Commission of any stop order suspending the effectiveness of the
Registration Statement or the initiation of any proceedings for that
purpose. The Company will make every commercially reasonable effort to
prevent the issuance of any stop order and, if any stop order is issued, to
obtain, as soon as possible, the lifting thereof.
(f) The Company will comply to the best of its ability with the
Securities Act, the Exchange Act and the Trust Indenture Act and the
regulations thereunder so as to permit the completion of the distribution
of the Securities as contemplated in this Agreement and the Prospectus; and
the Company, during the period when the Preliminary Prospectus and the
Prospectus is required to be delivered under the Securities Act, will file
promptly all documents required to be filed with the Commission pursuant to
Section 13 or 14 of the Exchange Act within the time periods required under
the Exchange Act.
24
(g) The Company will endeavor to qualify the Securities for offer and
sale under the state securities or blue sky laws of such jurisdictions as
you shall reasonably request and to maintain such qualifications in effect
for as long as may be required for the distribution of the Securities;
PROVIDED, HOWEVER, that the Company shall not be obligated to file any
general consent to service of process or to qualify as a foreign
corporation or as a dealer in securities in any jurisdiction in which it is
not so qualified or to subject itself to taxation in respect of doing
business in any jurisdiction in which it is not otherwise so subject. The
Company will file such statements and reports as may be required by the
laws of each jurisdiction in which the Securities have been qualified as
above provided.
(h) With respect to each sale of Securities, the Company will make
generally available to its security holders as soon as practicable but in
any event not later than 90 days after the close of the period covered
thereby a consolidated earnings statement for a twelve-month period
beginning after the effective date (as defined in Rule 158(c) under the
Securities Act) of the Registration Statement relating to such Securities,
but not later than the first day of the Company's fiscal quarter next
following such effective date and that otherwise satisfies the provisions
of Section 11(a) of the Securities Act and the regulations thereunder.
(i) The Company will use the proceeds received from the sale of the
Securities in the manner specified in the Prospectus under the heading "Use
of Proceeds."
(j) For a period of five years after the Closing Date, if so
requested, the Company will furnish to each of you copies of all annual
reports, quarterly reports and current reports filed with the Commission on
Forms 10-K, 10-Q and 8-K, or such other similar forms as may be designated
by the Commission, and such other documents, reports and information as
shall be furnished by the Company to the holders of the Securities or to
security holders of its respective publicly issued securities generally.
(k) During the period beginning on the date hereof and continuing to
and including the Closing Date, not to offer, sell, contract to sell or
otherwise dispose of any debt securities of the Company or warrants to
purchase debt securities of the Company substantially similar to the
Securities (other than (i) the Securities and (ii) any debt securities of
the
25
Company with a maturity of less than one year), without the prior written
consent of Xxxxxx Xxxxxxx & Co. Incorporated.
(l) To pay all expenses incident to the performance of its obligations
under this Agreement, including: (i) the preparation and filing of the
Registration Statement including all financial statements, schedules and
exhibits and the Prospectus and all amendments and supplements thereto;
(ii) the preparation, issuance and delivery to you of the Securities; (iii)
the fees and disbursements of the Company's counsel and accountants and of
the Trustee and its counsel; (iv) the qualification of the Securities under
the state securities or blue sky laws in accordance with the provisions of
Section 6(g) herein, including filing fees and the fees and disbursements
of counsel for the Underwriters in connection therewith and in connection
with the preparation of the preliminary and final state securities laws or
blue sky surveys (the "Blue Sky Surveys") or any Legal Investment
Memoranda; (v) the printing and delivery to the Underwriters in quantities
as hereinabove stated of copies of the Registration Statement and all
amendments thereto and of each Preliminary Prospectus and the Prospectus
and any amendments or supplements thereto; (vi) the printing and delivery
to the Underwriters of copies of the Blue Sky Surveys or any Legal
Investment Memoranda; (vii) any fees charged by rating agencies for the
rating of the Securities or the listing, if any, of the Securities on the
NYSE; (viii) the filing fees and expenses, if any, incurred with respect to
any filing with the National Association of Securities Dealers, Inc. (the
"NASD") made in connection with the offering of the Securities; (ix) any
expenses incurred by the Company in connection with a "road show"
presentation to potential investors and (x) document production charges, if
any, of counsel to the Underwriters incurred in connection with the
preparation of the Indenture.
8. INDEMNITY AND CONTRIBUTION. (a) The Company agrees to indemnify
and hold harmless each Underwriter and each person, if any, who controls any
Underwriter within the meaning of either Section 15 of the Securities Act or
Section 20 of the Exchange Act, from and against any and all losses, claims,
damages and liabilities (including, without limitation, any legal or other
expenses reasonably incurred by any Underwriter or any such controlling person
in connection with defending or investigating any such action or claim) caused
by any untrue statement or alleged untrue statement of a material fact contained
in the Registration
26
Statement or any amendment thereof, any Preliminary Prospectus or the Prospectus
(as amended or supplemented if the Company shall have furnished any amendments
or supplements thereto), 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, except insofar as such losses, claims,
damages or liabilities are caused by any such untrue statement or omission or
alleged untrue statement or omission based upon information relating to any
Underwriter furnished to the Company in writing by such Underwriter through you
expressly for use therein PROVIDED, HOWEVER, that the foregoing indemnity
agreement with respect to any Preliminary Prospectus shall not inure to the
benefit of any Underwriter from whom the person asserting any such losses,
claims, damages or liabilities purchased Securities, or any person controlling
such Underwriter, if a copy of the Prospectus (as then amended or supplemented
if the Company shall have furnished any amendments or supplements thereto) was
not sent or given by or on behalf of such Underwriter to such person, if
required by law so to have been delivered, at or prior to the written
confirmation of the sale of Securities to such person, and if the Prospectus (as
so amended or supplemented) would have cured the defect giving rise to such
losses, claims, damages or liabilities.
(b) Each Underwriter agrees, severally and not jointly, to indemnify
and hold harmless the Company, its directors, its officers who sign the
Registration Statement and each person, if any, who controls the Company within
the meaning of either Section 15 of the Securities Act or Section 20 of the
Exchange Act to the same extent as the foregoing indemnity from the Company to
such Underwriter, but only with reference to information relating to such
Underwriter furnished to the Company in writing by such Underwriter through you
expressly for use in the Registration Statement, any Preliminary Prospectus, the
Prospectus or any amendments or supplements thereto.
(c) In case any proceeding (including any governmental investigation)
shall be instituted involving any person in respect of which indemnity may be
sought pursuant to either paragraph (a) or (b) of this Section 8, such person
(the "indemnified party") shall promptly notify the person against whom such
indemnity may be sought (the "indemnifying party") in writing and the
indemnifying party, upon request of the indemnified party, shall retain counsel
reasonably satisfactory to the indemnified party to represent the indemnified
party and any others the indemnifying party may designate in such proceeding and
shall pay the fees and disbursements of such counsel related to such proceeding
but the failure so to notify the indemnifying party (i) will not relieve it from
liability
27
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 obligations to any
indemnified party other than the indemnification obligation provided in
paragraph (a) or (b) above. In any such proceeding, any indemnified party
shall have the right to retain its own counsel, but the fees and expenses of
such counsel shall be at the expense of such indemnified party unless (i) the
indemnifying party and the indemnified party shall have mutually agreed to
the retention of such counsel or (ii) the named parties to any such
proceeding (including any impleaded parties) include both the indemnifying
party and the indemnified party and representation of both parties by the
same counsel would be inappropriate due to actual or potential differing
interests between them. It is understood that the indemnifying party shall
not, in respect of the legal expenses of any indemnified party in connection
with any proceeding or related proceedings in the same jurisdiction, be
liable for the fees and expenses of more than one separate firm (in addition
to any local counsel) for all such indemnified parties and that all such fees
and expenses shall be reimbursed as they are incurred. Such firm shall be
designated in writing by Xxxxxx Xxxxxxx & Co. Incorporated, in the case of
parties indemnified pursuant to paragraph (a) above and by the Company, in
the case of parties indemnified pursuant to paragraph (b) above. The
indemnifying party shall not be liable for any settlement of any proceeding
effected without its written consent (not to be unreasonably withheld), but
if settled with such consent or if there be a final judgment for the
plaintiff, the indemnifying party agrees to indemnify the indemnified party
from and against any loss or liability by reason of such settlement or
judgment. Notwithstanding the foregoing sentence, if at any time an
indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel as contemplated by the
second and third sentences of this paragraph, the indemnifying party agrees
that it shall be liable for any settlement of any proceeding effected without
its written consent if (i) such settlement is entered into more than 30 days
after receipt by such indemnifying party of the aforesaid request and (ii)
such indemnifying party shall not have reimbursed the indemnified party in
accordance with such request prior to the date of such settlement. No
indemnifying party shall, without the prior written consent of the
indemnified party, effect any settlement of any pending or threatened
proceeding 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 (i) such settlement includes an unconditional release of such
indemnified party from all
28
liability on claims that are the subject matter of such proceeding and (ii) does
not include a statement as to or an admission of fault, culpability or a failure
to act by or on behalf of any indemnified party.
(d) To the extent the indemnification provided for in paragraph (a) or
(b) of this Section 8 is unavailable to an indemnified party or insufficient to
hold harmless an indemnified party in respect of any losses, claims, damages or
liabilities referred to therein, then each indemnifying party under such
paragraph, in lieu of indemnifying such indemnified party thereunder, shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages or liabilities (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company on the one
hand and the Underwriters on the other hand from the offering of the 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 on the one hand and of the Underwriters on the other hand in
connection with the statements or omissions that 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 hand in connection with the offering of the
Securities shall be deemed to be in the same respective proportions as the net
proceeds from the offering of the Securities (before deducting expenses)
received by the Company and the total underwriting discounts and commissions
received by the Underwriters, in each case as set forth in the table on the
cover of the Prospectus, bear to the aggregate Public Offering Price of the
Securities. The relative fault of the Company on the one hand and the
Underwriters on the other hand shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company or by the Underwriters and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The Underwriters' respective obligations to contribute
pursuant to this Section 8 are several in proportion to the respective principal
amounts of Securities they have purchased hereunder, and not joint.
(e) The Company and the Underwriters agree that it would not be just
or equitable if contribution pursuant to this Section 8 were determined by PRO
RATA allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation that does
29
not take account of the equitable considerations referred to in paragraph (d)
of this Section 8. The amount paid or payable by an indemnified party as a
result of the losses, claims, damages and liabilities referred to in the
immediately preceding paragraph shall be deemed to include, subject to the
limitations set forth above, any legal or other expenses reasonably incurred
by such indemnified party in connection with investigating or defending any
such action or claim. Notwithstanding the provisions of this Section 8, no
Underwriter shall be required to contribute any amount in excess of the
amount by which the total price at which the Securities underwritten by it
and distributed to the public were offered to the public exceeds the amount
of any damages that such Underwriter has otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The remedies provided for in this Section 8 are not
exclusive and shall not limit any rights or remedies which may otherwise be
available to any indemnified party at law or in equity.
9. SURVIVAL. The indemnity and contribution provisions contained in
Section 8 herein and the representations, warranties and other statements of the
Company contained in this Agreement shall remain operative and in full force and
effect regardless of (a) any termination of this Agreement, (b) any
investigation made by or on behalf of any Underwriter or any person controlling
any Underwriter or by or on behalf of the Company, its officers or directors or
any person controlling the Company and (c) acceptance of and payment for any of
the Securities.
10. TERMINATION. Xxxxxx Xxxxxxx & Co. Incorporated may terminate this
Agreement by notice to the Company, at any time at or prior to the Closing Date
(a) if there has been, since the respective dates as of which information is
given in the Registration Statement or the Prospectus, any Material Adverse
Change, or any development involving a prospective Material Adverse Change or
(b) if there has occurred any new outbreak of hostilities or escalation of
existing hostilities or other calamity or crisis the effect of which on the
financial markets in the United States is such as to make it, in your judgment,
impracticable to market the Securities or enforce contracts for the sale of the
Securities, or (c) if trading in any securities of the Company has been
suspended on any exchange or in any over-the-counter market or by the
Commission, or if trading generally on the NYSE has been suspended, or minimum
or maximum prices for trading have been fixed, or
30
maximum ranges for prices for securities have been required, by such exchange or
by order of the Commission or any other governmental authority or (d) if a
general moratorium on commercial banking activities in New York State has been
declared by either federal or New York State authorities.
11. DEFAULTING UNDERWRITERS. If, on the Closing Date, any one or more
of the Underwriters shall fail or refuse to purchase and pay for the Securities
that it has or they have agreed to purchase hereunder on such date, and the
aggregate principal amount of Securities which such defaulting Underwriter or
Underwriters agreed but failed or refused to purchase is not more than one-tenth
of the aggregate principal amount of the Securities to be purchased on such
date, the other Underwriters shall be obligated severally in the proportions
that the principal amount of Securities set forth opposite their respective
names in Schedule I bears to the principal amount of Securities set forth
opposite the names of all such non-defaulting Underwriters, or in such other
proportions as you may specify, to purchase the Securities which such defaulting
Underwriter or Underwriters agreed but failed or refused to purchase on such
date; PROVIDED that in no event shall the principal amount of Securities that
any Underwriter has agreed to purchase pursuant to this Agreement be increased
pursuant to this Section 11 by an amount in excess of one-ninth of such
principal amount of Securities without the written consent of such Underwriter.
If, on the Closing Date, any Underwriter or Underwriters shall fail or refuse to
purchase and pay for the Securities and the aggregate principal amount of
Securities with respect to which such default occurs is more than one-tenth of
the aggregate principal amount of Securities to be purchased on such date, and
arrangements satisfactory to you and the Company for the purchase of such
Securities are not made within 36 hours after such default, this Agreement shall
terminate without liability on the part of any non-defaulting Underwriter or the
Company. In any such case either you or the Company shall have the right to
postpone the Closing Date, but in no event for longer than seven days, in order
that the required changes, if any, in the Registration Statement and in the
Prospectus or in any other documents or arrangements may be effected. Any
action taken under this paragraph shall not relieve any defaulting Underwriter
from liability in respect of any default of such Underwriter under this
Agreement.
12. NOTICES. All notices and other communications required or
permitted to be given under this Agreement shall be in writing and shall be
given (and shall be deemed to have been given upon receipt) by delivery in
person, by cable, by telecopy, ny telegram, by telex or by registered or
certified mail (postage prepaid, return
31
receipt requested) to the applicable party at the addresses indicated below:
(a) IF TO THE UNDERWRITERS:
Xxxxxx Xxxxxxx & Co. Incorporated
000 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Facsimile No.: (000) 000-0000
Attention: Xxxxxxx Xxxxxxxx III
WITH A COPY TO:
Xxxxxxx Xxxxxxx & Xxxxxxxx
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile No.: (000) 000-0000
Attention: Xxxx X. Xxxxx, Esq.
(b) IF TO THE COMPANY:
Xxxxx-Illinois, Inc.
One XxxXxxx
Xxxxxx, Xxxx 00000
Facsimile No.: (000) 000-0000
Attention: Xxxxxx X. Xxxxx, Esq.
General Counsel
WITH A COPY TO:
Kohlberg Kravis & Xxxxxxx & Co.
0000 Xxxx Xxxx Xxxx, Xxxxx 000
Xxxxx Xxxx, Xxxxxxxxxx 00000
Facsimile No.: (000) 000-0000
Attention: Xxxxxx X. Xxxxxxx
Partner
AND WITH A COPY TO:
Xxxxxx & Xxxxxxx
000 Xxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Facsimile No.: (000) 000-0000
Attention: Xxxxx X. Xxxxxxxx, Esq.
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 herein, and no
other person will have any right or obligation hereunder.
14. COUNTERPARTS. This Agreement may be signed in two or more
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.
32
15. APPLICABLE LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK.
16. HEADINGS. The headings of the sections of this Agreement have
been inserted for convenience of reference only and shall not be deemed a part
of this Agreement.
17. AUTHORITY OF REPRESENTATIVE. Xxxxxx Xxxxxxx & Co. Incorporated
hereby represents and warrants to the Company that it has the authority to act
as agent on behalf of the Underwriters named in Schedule I and the Company shall
be entitled to rely upon statements, notices, requests and agreements made by
Xxxxxx Xxxxxxx & Co. on behalf of the Underwriters.
33
Very truly yours,
XXXXX-ILLINOIS, INC.
By:/S/ XXXXX X. XXX XXXXXX
--------------------------
Name: Xxxxx X. Xxx Xxxxxx
Title: Senior Vice President
Accepted as of the date hereof
XXXXXX XXXXXXX & CO. INCORPORATED
BT SECURITIES CORPORATION
CREDIT SUISSE FIRST BOSTON CORPORATION
NATIONSBANC CAPITAL MARKETS, INC.
SALOMON BROTHERS INC
Acting severally on behalf
of themselves and the several
Underwriters named herein
By: XXXXXX XXXXXXX & CO.
INCORPORATED
By:/S/ XXXXXXX X. XXXXXX, XX
----------------------------
Name: Xxxxxxx X. Xxxxxx, XX
Title: Principal
34
SCHEDULE I
Principal Amount Principal Amount
of 7.85% Senior of 8.10% Senior
Notes due 2004 Notes due 2007
Underwriter To Be Purchased To Be Purchased
----------- --------------- ----------------
Xxxxxx Xxxxxxx & Co.
Incorporated ............................ $120,000,000 $120,000,000
BT Securities Corporation.................. 45,000,000 45,000,000
Credit Suisse First Boston
Corporation.............................. 45,000,000 45,000,000
NationsBanc Capital
Markets, Inc............................. 45,000,000 45,000,000
Salomon Brothers Inc ...................... 45,000,000 45,000,000
------------ ----------
Total............................ $300,000,000 $300,000,000
------------ -----------
------------ -----------
Schedule II
Upon the consummation of the Senior Note Offerings, 100% of the shares of
capital stock of each Significant Subsidiary will be, directly or indirectly,
owned by the Company free and clear of any material lien, except that the
Company owns approximately 79% of the outstanding shares of AVIR S.p.A.
