3/11/02
COMPANHIA VALE DO RIO DOCE
(a Brazilian corporation)
_______ American Depositary Shares
representing
__ Common Shares
PURCHASE AGREEMENT
Dated: ___________, 2002
TABLE OF CONTENTS
GLOBAL PURCHASE AGREEMENT................................................ 2
SECTION 1. Representations and Warranties.............................. 4
(a) Representations and Warranties by the Company.......... 4
(i) Compliance with Registration Requirements.............. 4
(ii) Independent Accountants................................ 5
(iii) Financial Statements................................... 5
(iv) No Material Adverse Change in Business................. 5
(v) Due Organization of the Company........................ 6
(vi) Due Organization of the Subsidiaries................... 6
(vii) Capitalization......................................... 6
(viii) Authorization of Agreement............................. 7
(ix) Authorization of Deposit Agreement..................... 7
(x) Proper Legal Form...................................... 7
(xi) Validity of ADRs....................................... 7
(xii) No Limitation on Vote, Transfer and Payment of
Dividends.............................................. 8
(xiii) Description of Securities.............................. 8
(xiv) Absence of Defaults and Conflicts...................... 8
(xv) Absence of Labor Dispute............................... 9
(xvi) Absence of Proceedings................................. 9
(xvii) Accuracy of Exhibits................................... 9
(xviii) No Relationship........................................ 10
(xix) Possession of Intellectual Property.................... 10
(xx) Absence of Further Requirements........................ 10
(xxi) Possession of Licenses and Permits..................... 11
ii
(xxii) Title to Property...................................... 11
(xxiii) Waiver of Immunities................................... 11
(xxiv) Consent to Jurisdiction; Appointment of Agent for
Service of Process..................................... 12
(xxv) No Transaction Tax, Stamp Duty or Similar Tax or Duty.. 12
(xxvi) Enforceability of New York Judgment.................... 12
(xxvii) Investment Company Act................................. 13
(xxviii) Environmental Laws..................................... 13
(xxix) Absence of Manipulation................................ 13
(xxx) PFIC Status............................................ 14
(xxxi) Registration Rights.................................... 14
(xxxii) Exchange Controls...................................... 14
(b) Officer's Certificates................................. 14
(c) Representations and Warranties by the Selling
Shareholders........................................... 14
(i) Accurate Disclosure.................................... 14
(ii) Authorization of Agreements............................ 15
(iii) Good and Marketable Title.............................. 15
(iv) Absence of Manipulation................................ 16
(v) Absence of Further Requirements........................ 16
(vi) Certificates Suitable for Transfer..................... 16
(vii) No Association with NASD............................... 16
(viii) Consent to Jurisdiction; Appointment of Agent for
Service of Process..................................... 17
(ix) No Transaction Tax, Stamp Duty or Similar Tax or Duty.. 17
(x) Enforceability of New York Judgment.................... 17
(xi) Good Standing.......................................... 18
(xii) Absence of Proceedings................................. 18
iii
(d) Officer's Certificates................................. 18
SECTION 2. Sale and Delivery to Underwriters; Closing.................. 18
(a) Initial Securities..................................... 18
(b) Option Securities...................................... 19
(c) Payment................................................ 19
(d) Denominations; Registration; Delivery of ADRs.......... 20
SECTION 3. Covenants................................................... 20
(a) Covenants of the Company............................... 20
(i) Compliance with Securities Regulations and Commission
Requests............................................... 20
(ii) Filing of Amendments................................... 21
(iii) Delivery of Registration Statements.................... 21
(iv) Delivery of Prospectus................................. 21
(v) Continued Compliance with Securities Laws.............. 22
(vi) Blue Sky Qualifications................................ 22
(vii) Rule 158............................................... 23
(viii) Listing................................................ 23
(ix) Restriction on Sale of Securities...................... 23
(x) Other Documents........................................ 23
(xi) Delivery Requirements.................................. 24
(xii) Reporting Requirements................................. 24
(xiii) Taxes and Fees......................................... 24
(xiv) Submission of Documents................................ 24
(xv) [PFIC Classification................................... 24
(b) Covenants of the Selling Shareholders.................. 25
(i) Deposit of Common Shares............................... 25
iv
(ii) Indemnification for Stamp Taxes........................ 25
(iii) Restriction on Sale of Securities...................... 25
SECTION 4. Payment of Expenses......................................... 26
SECTION 5. Conditions of Underwriters' Obligations..................... 26
(a) Effectiveness of Registration Statement................ 26
(b) Opinion of Brazilian Counsel for Company............... 27
(c) Opinion of Special U.S. Counsel for Company............ 27
(d) Opinion of Brazilian Counsel for Selling Shareholders.. 27
(e) Opinion of Special U.S. Counsel for Selling
Shareholders........................................... 27
(f) Opinion of Counsel for Depositary...................... 28
(g) Opinion of Brazilian Counsel for Underwriters.......... 28
(h) Opinion of U.S. Counsel for Underwriters............... 28
(i) Officers' Certificate.................................. 28
(j) Certificate of Selling Shareholders.................... 29
(k) Accountant's Comfort Letter............................ 29
(l) Bring-down Comfort Letter.............................. 29
(m) Deposit Agreement...................................... 29
(n) Certificate of Depositary.............................. 30
(o) Depositary Information................................. 30
(p) DTC Approval........................................... 30
(q) Company Documents...................................... 30
(r) Selling Shareholder Documents. ........................ 30
(s) Approval of Listing.................................... 30
(t) No Objection........................................... 31
(u) Lock-up Agreement...................................... 31
v
(v) Purchase of the Brazilian Securities................... 31
(w) Conditions to Purchase of Option Securities............ 31
(x) Additional Documents................................... 33
(y) Termination of Agreement............................... 33
SECTION 6. Indemnification............................................. 33
(a) Company Indemnification of Underwriters................ 33
(b) Selling Shareholders Indemnification of Underwriters... 34
(c) Indemnification of Company, Directors, Officers and
Selling Shareholders................................... 35
(d) Actions Against Parties; Notification.................. 36
(e) Settlement Without Consent if Failure to Reimburse..... 36
(f) Other Agreements with Respect to Indemnification....... 37
SECTION 7. Contribution................................................ 37
SECTION 8. Representations, Warranties and Agreements to Survive
Delivery.................................................... 38
SECTION 9. Termination of Agreement.................................... 38
(a) Termination; General................................... 38
(b) Liabilities............................................ 39
SECTION 10. Default by One or More of the Underwriters................. 39
SECTION 11. Default by the Selling Shareholders........................ 40
SECTION 12. Notices.................................................... 40
SECTION 13. Parties.................................................... 41
SECTION 14. Waiver of Immunities....................................... 41
(a) The Company............................................ 41
(b) BNDES.................................................. 41
SECTION 15. Arbitration; Company and BNDES............................. 42
SECTION 16. Consent to Jurisdiction; Appointment of Agent for Service
of Process................................................. 42
vi
(h) Appointment of Agent for Service of Process............ 44
(i) Survival of Agreement.................................. 45
SECTION 17. Judgment Currency. ........................................ 45
SECTION 18. GOVERNING LAW AND TIME..................................... 46
SECTION 19. Effect of Headings......................................... 46
Schedule A. List of Underwriters and Respective Number of Initial
Securities
Schedule B. List of Underwriters and Respective Number of Option
Securities
Schedule C. Pricing Information
Schedule D. List of Subsidiaries
Schedule E. List of Persons and Entities Subject to Lock-up
EXHIBIT A. Form of Opinion of Company's Brazilian Counsel to Be Delivered
Pursuant to Section 5(b)
EXHIBIT B. Form of Opinion of Company's Special U.S. Counsel to Be
Delivered Pursuant to Section 5(c)
EXHIBIT C. Form of Opinion of Selling Shareholders' Brazilian Counsel to
Be Delivered Pursuant to Section 5(d)
EXHIBIT D. Form of Opinion of Selling Shareholders' Special U.S. Counsel
to Be Delivered Pursuant to Section 5(e)
EXHIBIT E. Form of Opinion of Depositary's Counsel to Be Delivered
Pursuant to Section 5(f)
EXHIBIT F. Form of Lock-Up from Directors, Officers or Other Shareholders
Pursuant to Section 5(u)
ANNEX A. Form of Accountant's Comfort Letter Pursuant to Section 5(k)
COMPANHIA VALE DO RIO DOCE
(a Brazilian corporation)
- American Depositary Shares
representing
- Common Share(s)
(No Par Value Per Share)
PURCHASE AGREEMENT
-, 2002
XXXXXXX XXXXX & CO.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
ABN AMRO ROTHSCHILD LLC,
as Representatives of the several Underwriters
4 World Financial Center
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Companhia Vale do Rio Doce, a Brazilian corporation (the
"Company"), the Federative Republic of Brazil ("Brazil"), acting through Banco
Nacional de Desenvolvimento Economico e Social ("BNDES"), a state enterprise
wholly owned by Brazil, acting in its capacity as administrator (gestor)
("Gestor") of the Brazilian Privatization Program (Programa Nacional de
Desestatizacao) pursuant to Brazilian Privatization Law No. [9,491 dated
September 9, 1997] (the "Brazilian Privatization Law") and Decreto No. 1510 of
June 1, 1995, Resolucao CND 2/97 of March 5, 1997, Resolucao CND 19/96 of
October 10, 1996 and Resolucao CND 2/2002 of January 23, 2002, and BNDES, acting
in its own capacity (together with Brazil, the "Selling Shareholders"), confirm
their respective agreements with Xxxxxxx Xxxxx & Co., Xxxxxxx Lynch, Pierce,
Xxxxxx & Xxxxx Incorporated ("Xxxxxxx Xxxxx"), ABN AMRO Rothschild LLC
("Rothschild") and each of the other Underwriters named in Schedule A hereto
(collectively, the "Underwriters," which term shall also include any underwriter
substituted as hereinafter provided in Section 10 hereof), for whom Xxxxxxx
Xxxxx and Xxxxxxxxxx are acting as representatives (in such capacity, the
"Representatives"), with respect to (i) the sale by the Selling Shareholders and
the purchase by the Underwriters, acting severally and not jointly, of
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the respective numbers of common shares, no par value, of the Company (the
"Common Shares"), represented by the respective numbers of American Depositary
Shares ("ADSs") set forth in said Schedule A hereto and (ii) the grant by each
of Brazil and BNDES, on a pro rata basis to the Underwriters, acting severally
and not jointly, of the option described in Section 2(b) hereof to purchase all
or any part of - additional Common Shares, in the form of ADSs, to cover
over-allotments, if any. The aforesaid - Common Shares, in the form of ADSs (the
"Initial Securities") to be purchased by the Underwriters and all or any part of
the - additional Common Shares, in the form of ADSs, subject to the option
described in Section 2(b) hereof (the "Option Securities") are hereinafter
called, collectively, the "Global Securities."
The Common Shares to be represented by ADSs are to be
deposited by the Selling Shareholders pursuant to a deposit agreement dated as
of the Closing Date (the "Deposit Agreement"), among the Company, JPMorgan Chase
Bank of New York, as depositary (the "Depositary"), and the holders from time to
time of the American Depositary Receipts (the "ADRs") to be issued under the
Deposit Agreement and evidencing the ADSs. Following deposit, the Depositary
will issue ADRs evidencing ADSs corresponding to the Common Shares so deposited.
It is understood that the Company and BNDES, acting on behalf
of Brazil, and BNDES, acting on its own behalf, are concurrently entering into
an agreement, dated the date hereof (the "Brazilian Purchase Agreement"), with
BB Banco de Investimento S.A. ("Banco do Brasil") and the other managers named
therein (the "Brazilian Managers") providing for the concurrent offering and
sale of - Common Shares (the "Brazilian Securities"). It is understood that
the Selling Shareholders are not obligated to sell, and the Underwriters are not
obligated to purchase, any Initial Securities unless all of the Brazilian
Securities are contemporaneously purchased by the Brazilian Managers.
The Global Securities and the Brazilian Securities are
hereinafter collectively called the "Securities." Unless the context otherwise
requires, references to the "Securities" herein shall constitute references to
the ADSs and the Common Shares represented thereby. Each ADS represents one
Common Share. All references to "U.S. dollars" or "$" herein are to United
States dollars.
The Underwriters and the Brazilian Managers will concurrently
enter into an Intersyndicate Agreement of even date herewith (the
"Intersyndicate Agreement") providing for the coordination of certain
transactions among the Underwriters and the Brazilian Managers under the
direction of Xxxxxxx Xxxxx and Xxxxxxxxxx (in such capacity, the "Global
Coordinators") and Banco do Brasil (in such capacity, the "Brazilian
Coordinator").
The Company and each of the Selling Shareholders understand
that the Underwriters propose to make a public offering of the Global Securities
as soon as the Representatives deem advisable after this Agreement has been
executed and delivered, by means of (A) a public offering in the United States
and (B) an offering to certain investors outside the United States in reliance
upon Regulation S under the 1933 Act (as defined below) (the
3
"Offering"). All sales in the United States by the Underwriters will be made
through their U.S. broker-dealer affiliates, which persons shall be registered
as broker-dealers under the Securities and Exchange Act of 1934, as amended (the
"Exchange Act").
The Company has filed with the Securities and Exchange
Commission (the "Commission") a registration statement on Form F-3 (No.
333-82136) covering the registration of 78,787,838 Securities under the
Securities Act of 1933, as amended (the "1933 Act"), including the related
preliminary prospectus or Prospectus. Promptly after execution and delivery of
this Agreement, the Company will prepare and file a prospectus in accordance
with the provisions of Rule 430A ("Rule 430A") of the rules and regulations of
the Commission under the 1933 Act (the "1933 Act Regulations") and paragraph (b)
of Rule 424 ("Rule 424(b)") of the 1933 Act Regulations. The information
included in such prospectus that was omitted from such registration statement at
the time it became effective but that is deemed to be part of such registration
statement at the time it became effective pursuant to paragraph (b) of Rule 430A
is referred to as "Rule 430A Information." A form of prospectus is to be used in
connection with the offering and sale of the Global Securities (the "Form of
Prospectus"). The Form of Prospectus used before such registration statement
became effective, and any prospectus that omitted the Rule 430A Information that
was used after such effectiveness and prior to the execution and delivery of
this Agreement, is herein called a "preliminary prospectus." Such registration
statement, including the exhibits thereto and schedules thereto, if any, at the
time it became effective and including the Rule 430A Information is herein
called the "Registration Statement." Any registration statement filed pursuant
to Rule 462(b) of the 1933 Act Regulations is herein referred to as the "Rule
462(b) Registration Statement," and after such filing the term "Registration
Statement" shall include the Rule 462(b) Registration Statement, unless the
context otherwise requires. The final Form of Prospectus, in the form first
furnished to the Underwriters to confirm sales of the Global Securities, is
herein called the "Prospectus" (which term shall also include the ADR Prospectus
(as defined below) unless the context otherwise requires). For purposes of this
Agreement, all references to the Registration Statement, the preliminary
prospectus, the Prospectus or any amendment or supplement to any of the
foregoing shall be deemed to include the copy filed with the Commission pursuant
to its Electronic Data Gathering, Analysis and Retrieval system ("XXXXX").
The Company has prepared two prospectuses in connection with
the Offering:
(A) The Prospectus relating to the public offering in the
United States, the United Kingdom and certain other
jurisdictions outside Brazil and Canada.
(B) A Canadian prospectus (the "Canadian Prospectus")
which consists of the Prospectus wrapped by an
additional disclosure document relating to an
offering to institutional investors in Canada.
The Company has also filed with the Commission a registration
statement on Form F-6 (No. 333-82136) and a related prospectus, which may be in
the form of the ADR certificate, for the registration under the 1933 Act of the
ADSs evidenced by ADRs, has filed such amendments thereto and such amended
preliminary Prospectus as may have been required
4
to the date hereof, and will file such additional amendments thereto and such
amended Prospectus as may hereafter be required. The registration statement on
Form F-6 for the registration of the ADSs evidenced by ADRs, as amended at the
time it becomes effective (including by the filing of any post-effective
amendments thereto), and the prospectus included therein, as then amended, are
hereinafter called the "ADR Registration Statement" and the "ADR Prospectus,"
respectively.
SECTION 1. Representations and Warranties.
(a) Representations and Warranties by the Company. The Company
represents and warrants to each Underwriter as of the date hereof, as of the
Closing Time referred to in Section 2(c) hereof, and as of each Date of Delivery
(if any) referred to in Section 2(b) hereof, and agrees with each Underwriter,
as follows:
(i) Compliance with Registration Requirements. The
Company meets the requirements for use of Form F-3 under the 1933 Act.
Each of the Registration Statement, any Rule 462(b) Registration
Statement and the ADR Registration Statement has become effective under
the 1933 Act and no stop order suspending the effectiveness of the
Registration Statement, any Rule 462(b) Registration Statement or the
ADR Registration Statement has been issued under the 1933 Act and no
proceedings for that purpose have been instituted or are pending or, to
the knowledge of the Company, are contemplated by the Commission, and
any request on the part of the Commission for additional information
has been complied with.
At the respective times the Registration Statement, any Rule
462(b) Registration Statement and any post-effective amendments thereto
became effective and at the Closing Time (and, if any Option Securities
are purchased, at the Date of Delivery), the Registration Statement,
the Rule 462(b) Registration Statement and any amendments and
supplements thereto complied and will comply in all material respects
with the requirements of the 1933 Act and the 1933 Act Regulations and
did not and will not contain an untrue statement of a material fact or
omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading. Neither the
Prospectus nor any amendments or supplements thereto, at the time the
Prospectus or any such amendment or supplement was issued and at the
Closing Time (and, if any Option Securities are purchased, at the Date
of Delivery), included or will include an untrue statement of a
material fact or omitted or will 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. The
representations and warranties in this subsection shall not apply to
statements in or omissions from the Registration Statement or the
Prospectus made in reliance upon and in conformity with information
furnished to the Company in writing by any Underwriter through the
Global Coordinators expressly for use in the Registration Statement or
the Prospectus or to the Selling Shareholder Information (as defined
herein).
5
Each preliminary prospectus and the prospectus filed as part
of the Registration Statement as originally filed or as part of any
amendment thereto, or filed pursuant to Rule 424 under the 1933 Act,
complied when so filed in all material respects with the 1933 Act
Regulations.
At the time the ADR Registration Statement became effective
and at the Closing Time (and, if any Option Securities are purchased,
at the Date of Delivery), the ADR Registration Statement complied or
will comply, as the case may be, in all material respects with the
requirements of the 1933 Act and the 1933 Act Regulations and did not
and will not contain, as the case may be, an untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading. The
ADR Prospectus, at the time the ADR Prospectus or any amendment or
supplement thereto was issued and at the Closing Time (and, if any
Option Securities are purchased, at the Date of Delivery), did not and
will not include 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.
(ii) Independent Accountants. The accountants who
certified the financial statements and supporting schedules, if any,
included in the Registration Statement are independent public
accountants as required by the 1933 Act and the 1933 Act Regulations.
(iii) Financial Statements. The financial statements
included in the Registration Statement and the Prospectus, together
with the related schedules and notes, present fairly the financial
position of the Company and its consolidated subsidiaries at the dates
indicated and the statement of operations, stockholders' equity and
cash flows of the Company and its consolidated subsidiaries for the
periods specified; and such financial statements have been prepared in
conformity with accounting principles generally accepted in the United
States. The supporting schedules, if any, included in the Registration
Statement present fairly the information required to be stated therein.
The selected financial data and the summary financial information
included in the Prospectus present fairly the information shown therein
and have been compiled on a basis consistent with that of the audited
financial statements included in the Registration Statement.
(iv) No Material Adverse Change in Business. Since the
respective dates as of which information is given in the Registration
Statement and the Prospectus, except as otherwise stated therein, (A)
there has been no material adverse change in the condition, financial
or otherwise, or in the earnings, business affairs or business
prospects of the Company and its majority-owned subsidiaries and
controlled joint ventures (such subsidiaries and joint ventures,
collectively, the "Subsidiaries") considered as one enterprise, whether
or not arising in the ordinary course of business (a "Material Adverse
Effect"), (B) there have been no transactions entered into by the
Company or any of its
6
Subsidiaries, other than those in the ordinary course of business,
which are material with respect to the Company and its Subsidiaries
considered as one enterprise, and (C) there has been no dividend or
distribution of any kind declared, paid or made by the Company on any
class of its capital stock.
(v) Due Organization of the Company. The Company has been
duly organized and is validly existing as a corporation under the laws
of Brazil and has corporate power and authority to own, lease and
operate its properties and to conduct its business as described in the
Prospectus and to enter into and perform its obligations under this
Agreement, the Brazilian Purchase Agreement and the Deposit Agreement;
and the Company is duly qualified as a foreign corporation to transact
business and is in good standing in each other jurisdiction in which
such qualification is required, whether by reason of the ownership or
leasing of property or the conduct of business, except where the
failure so to qualify or to be in good standing would not result in a
Material Adverse Effect.
(vi) Due Organization of the Subsidiaries. Each of the
Subsidiaries has been duly organized and is validly existing as a
corporation under the laws of the jurisdiction of its incorporation and
has corporate power and authority to own, lease and operate its
properties and to conduct its business as described in the Prospectus;
and each Subsidiary is duly qualified as a foreign corporation to
transact business in each other jurisdiction in which such
qualification is required, whether by reason of the ownership or
leasing of property or the conduct of business, except where the
failure so to qualify or to be in good standing would not result in a
Material Adverse Effect.
(vii) Capitalization. The authorized, issued and
outstanding capital stock of the Company is as set forth in the
Prospectus under the caption "Capitalization" in all material respects
(except pursuant to reservations, agreements or employee benefit plans
referred to in the Prospectus or pursuant to the exercise of
convertible securities or options referred to in the Prospectus). The
shares of issued and outstanding capital stock, including the Common
Shares to be purchased by the Underwriters and the Brazilian Managers
from the Selling Shareholders, have been duly authorized and validly
issued and are fully paid and non-assessable, and no holder thereof
will be subject to personal liability by reason of being such a holder;
and none of the outstanding shares of capital stock, including the
Common Shares to be purchased by the Underwriters and the Brazilian
Managers, was issued in violation of the preemptive or other similar
rights of any securityholder of the Company.
(viii) Authorization of Agreement. This Agreement and the
Brazilian Purchase Agreement have been duly authorized, executed and
delivered by the Company.
(ix) Authorization of Deposit Agreement. The Deposit
Agreement has been duly authorized, executed and delivered by the
Company and, assuming due authorization, execution and delivery by the
Depositary, constitutes a valid and legally binding obligation of the
Company, enforceable in accordance with its terms, subject as
7
to enforcement to bankruptcy, insolvency, reorganization and other laws
of general applicability relating to or affecting creditors' rights
generally, to Brazilian public policy and to general equity principles,
and, with respect to enforceability in Brazil, subject to proper
notarization and legalization of the Deposit Agreement with the
Brazilian Consulate in New York, New York, registration with the
appropriate Registry of Titles and Deeds in Brazil and translation into
Portuguese by a sworn translator.
(x) Proper Legal Form. This Agreement is, and the
Brazilian Purchase Agreement and the Deposit Agreement, upon the due
execution and delivery thereof, will be, in proper legal form under the
laws of Brazil for the enforcement thereof in Brazil against the
Company; and it is not necessary to ensure the legality, validity,
enforceability or admissibility in evidence of any of the aforesaid
agreements in Brazil that any of them be filed or recorded or enrolled
with any court or authority in Brazil or that any stamp, registration
or similar tax be paid in Brazil; except that, in order to enforce any
of the agreements referred to in this paragraph against the Company in
Brazil, such agreements (except for the Brazilian Purchase Agreement,
if signed in Brazil) must first be (i) notarized by a local notary and
the signature of such notary authenticated by the Brazilian consulate
having jurisdiction over the place of execution; (ii) translated into
Portuguese by a sworn translator (and all Brazilian court proceedings
would be based on such translation); and (iii) registered with the
Cartorio de Titulos e Documentos in the place of the head offices of
the Company, and the party seeking enforcement will be required to pay
applicable court costs.
(xi) Validity of ADRs. Upon the due issuance by the
Depositary of ADRs evidencing ADSs against the deposit of Common Shares
in accordance with the provisions of the Deposit Agreement, such ADRs
evidencing ADSs will be duly and validly issued and persons in whose
names such ADRs evidencing ADSs are registered will be entitled to the
rights of registered holders of ADRs evidencing ADSs specified therein
and in the Deposit Agreement.
(xii) No Limitation on Vote, Transfer and Payment of
Dividends. Except as set forth in the Deposit Agreement or the
Prospectus, there are no limitations under Brazilian law on the rights
of holders of Common Shares, ADSs or ADRs evidencing ADSs to hold or
vote or transfer their respective securities, and no approvals are
currently required in Brazil (including any foreign exchange or foreign
currency approvals) in order for the Company to pay dividends declared
by the Company to the holders of Common Shares, the ADSs or the ADRs,
including the Depositary. Except as set forth in the Prospectus, all
dividends and other distributions declared and payable on the Common
Shares may under current Brazilian laws and regulations be paid to the
Depositary in Brazilian reais that may be converted into foreign
currency that may be freely transferred out of Brazil; and all such
dividends and other distributions are otherwise free and clear of any
other tax, duty, withholding or deduction in Brazil without the
necessity of obtaining any governmental authorization in Brazil, other
than as described in the Prospectus under the
8
headings "Dividend Policy," "Description of Capital Stock - Mandatory
Dividend" or "Taxation - Brazilian Tax Considerations."
(xiii) Description of Securities. The Common Shares, the
ADRs and the ADSs conform to the descriptions thereof contained in the
Prospectus and such descriptions conform to the rights set forth in the
instruments defining the same and no holder of the Securities will be
subject to personal liability by reason of being such a holder.
(xiv) Absence of Defaults and Conflicts. Except as
disclosed in the Registration Statement and the Prospectus, neither the
Company nor any of its Subsidiaries is in violation of its charter or
by-laws or other organizational document, as the case may be, or in
default in the performance or observance of any obligation, agreement,
covenant or condition contained in any contract, indenture, mortgage,
deed of trust, loan or credit agreement, note, lease or other agreement
or instrument to which the Company or any of its Subsidiaries is a
party or by which it or any of them may be bound, or to which any of
the property or assets of the Company or any of its Subsidiaries is
subject (collectively, "Agreements and Instruments") except for such
violations or defaults that singly or in the aggregate would not result
in a Material Adverse Effect; and the execution, delivery and
performance of this Agreement, the Brazilian Purchase Agreement and the
consummation of the transactions contemplated in this Agreement, the
Brazilian Purchase Agreement and in the Registration Statement and
compliance by the Company with its obligations under this Agreement and
the Brazilian Purchase Agreement have been duly authorized by all
necessary corporate action and do not and will not, whether with or
without the giving of notice or passage of time or both, conflict with
or constitute a breach of, or default or Repayment Event (as defined
below) under, or result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the Company or any
of its Subsidiaries pursuant to the Agreements and Instruments (except
for such conflicts, breaches or defaults, Repayment Events or liens,
charges or encumbrances that would not result in a Material Adverse
Effect), nor will such action result in any violation of the provisions
of the charter or by-laws or other organizational document of the
Company or any of its Subsidiaries or any applicable treaty, law,
statute, rule, regulation, judgment, order, writ or decree of any
government, government instrumentality or court, domestic or foreign,
having jurisdiction over the Company or any of its Subsidiaries or any
of their assets, properties or operations (except for such violations
as would not have a Material Adverse Effect). As used herein, a
"Repayment Event" means any event or condition which gives the holder
of any note, debenture or other evidence of indebtedness (or any person
acting on such holder's behalf) the right to require the repurchase,
redemption or repayment of all or a portion of such indebtedness by the
Company or any of its Subsidiaries.
(xv) Absence of Labor Dispute. Except as disclosed in the
Registration Statement and the Prospectus, no labor dispute with the
employees of the Company or any of its Subsidiaries exists or, to the
knowledge of the Company, is imminent, and the Company is not aware of
any existing or imminent labor disturbance by the employees of
9
any of its subsidiaries, principal suppliers, manufacturers, customers
or contractors, which, in either case, may reasonably be expected to
result in a Material Adverse Effect.
(xvi) Absence of Proceedings. There is no action, suit,
proceeding, inquiry or investigation before or brought by any court or
governmental agency or body, domestic or foreign, now pending, or, to
the knowledge of the Company, threatened, against or affecting the
Company or any of its Subsidiaries, that is required to be disclosed in
the Registration Statement or the Prospectus and is not so disclosed
or, except as disclosed in the Prospectus, that might reasonably be
expected to result in a Material Adverse Effect, or that might
reasonably be expected to materially and adversely affect the
properties or assets thereof or the consummation of the transactions
contemplated by this Agreement or the Brazilian Purchase Agreement or
the performance by the Company of its obligations hereunder or
thereunder; the aggregate of all pending legal or governmental
proceedings to which the Company or any of its Subsidiaries is a party
or of which any of their respective property or assets is the subject
which are not described in the Registration Statement or the
Prospectus, including ordinary routine litigation incidental to the
business, could not reasonably be expected to result in a Material
Adverse Effect.
(xvii) Accuracy of Exhibits. There are no contracts or
documents which are required to be described in the Registration
Statement or the Prospectus or to be filed as exhibits to the
Registration Statement which have not been so described and filed as
required.
(xviii) No Relationship. No relationship, direct or indirect,
exists between or among the Company or any of its Subsidiaries on the
one hand, and the directors, officers or stockholders of the Company or
any of its Subsidiaries on the other hand, that is required by the 1933
Act to be described in the Registration Statement and the Prospectus
that is not so described.
(xix) Possession of Intellectual Property. The Company and
its Subsidiaries own or possess, or can acquire on reasonable terms,
adequate patents, patent rights, licenses, inventions, know-how
(including trade secrets and other unpatented and/or unpatentable
proprietary or confidential information, systems or procedures) or
other intellectual property (collectively, "Intellectual Property")
necessary to carry on the business now operated by them, and none of
the Company or any of its Subsidiaries has received any notice or is
otherwise aware of any infringement of or conflict with asserted rights
of others with respect to any Intellectual Property or of any facts or
circumstances which would render any Intellectual Property invalid or
inadequate to protect the interest of the Company or any of its
Subsidiaries therein, and which infringement or conflict (if the
subject of any unfavorable decision, ruling or finding) or invalidity
or inadequacy, singly or in the aggregate, would result in a Material
Adverse Effect.
(xx) Absence of Further Requirements. Except for approvals
(A) from the Banco Central do Brasil (the "Central Bank") and the
Comissao de Valores Mobiliarios (the "CVM") relating to the Deposit
Agreement and the Custody Agreement under
10
Annex V to Resolution No. 1,289 of March 20, 1987, as amended, of the
Conselho Monetario Nacional ("CMN"), (B) from the CVM relating to the
offering of the Brazilian Securities and the Common Shares underlying
the ADSs as provided for in this Agreement, the Brazilian Purchase
Agreement and the Deposit Agreement (together, the "Transaction
Documents"), (C) from the Central Bank relating to the payment of the
fees and commissions contemplated by this Agreement and the Deposit
Agreement, (D) from the Commission as may be required under the 1933
Act or the 1933 Act Regulations, and (E) as may be required under the
blue sky laws of any jurisdiction in the United States in connection
with the purchase and distribution of the ADSs by the Underwriters, all
of which have been duly obtained or will be duly obtained prior to the
Closing Time, no filing with, or authorization, approval, consent,
license, order, registration, qualification or decree of, any court or
governmental authority or agency is necessary or required for the
performance by the Company of its obligations hereunder, in connection
with the offering or sale of the ADSs under this Agreement or the
offering or sale of the Brazilian Securities under the Brazilian
Purchase Agreement or the consummation of the transactions contemplated
by this Agreement and the Brazilian Purchase Agreement.
(xxi) Possession of Licenses and Permits. The Company and
its Subsidiaries possess such permits, licenses, approvals, consents
and other authorizations (collectively, "Governmental Licenses") issued
by the appropriate federal, state, local or foreign regulatory agencies
or bodies necessary to conduct the business now operated by them; the
Company and its Subsidiaries are in compliance with the terms and
conditions of all such Governmental Licenses, except where the failure
so to be in possession or to comply would not, singly or in the
aggregate, have a Material Adverse Effect; all of the Governmental
Licenses are valid and in full force and effect, except when the
invalidity of such Governmental Licenses or the failure of such
Governmental Licenses to be in full force and effect would not have a
Material Adverse Effect; and none of the Company or its Subsidiaries
has received any notice of proceedings relating to the revocation or
modification of any such Governmental Licenses which, singly or in the
aggregate, if the subject of an unfavorable decision, ruling or
finding, would result in a Material Adverse Effect.
(xxii) Title to Property. The Company and its Subsidiaries
have good and marketable title to all real property owned by them and
good title to all other properties owned by them, in each case, free
and clear of all mortgages, pledges, liens, security interests, claims,
restrictions or encumbrances of any kind except such as (a) are
described in the Prospectus or (b) where the failure to have good title
would not result in a Material Adverse Effect; and all of the leases
and subleases material to the business of the Company and its
Subsidiaries, considered as one enterprise, and under which the Company
or any of its Subsidiaries holds properties described in the
Prospectus, are in full force and effect except where the failure to be
in full force and effect would not result in a Material Adverse Effect,
and none of the Company or its Subsidiaries has any notice of any
material claim of any sort that has been asserted by anyone adverse to
the rights of the Company or any of its Subsidiaries under any of the
leases or subleases mentioned
11
above, or affecting or questioning the rights of the Company or any of
its Subsidiaries to the continued possession of the leased or subleased
premises under any such lease or sublease, other than claims which are
being contested by the Company or its subsidiaries in good faith and
which would not result in a Material Adverse Effect.
(xxiii) Waiver of Immunities. The Company and its obligations
under this Agreement, the Brazilian Purchase Agreement and the Deposit
Agreement are subject to civil and commercial law and to suit and none
of the Company or its Subsidiaries or their properties, assets or
revenues has any right of immunity under Brazilian or New York law from
any legal action, suit or proceeding, from the giving of any relief in
any such legal action, suit or proceeding, from setoff or counterclaim,
from the jurisdiction of any Brazilian, New York or U.S. federal court,
from service of process, attachment upon or prior to judgment, or
attachment in aid of execution of judgment, or from execution of a
judgment, or other legal process or proceeding for the giving of any
relief or for the enforcement of a judgment, in any such court, with
respect to its obligations, liabilities or any other matter under or
arising out of or in connection with this Agreement, the Brazilian
Purchase Agreement or the Deposit Agreement; and, to the extent that
the Company or any of its Subsidiaries or any of their properties,
assets or revenues may have or may hereafter become entitled to any
such right of immunity in any such court in which proceedings may at
any time be commenced, the Company has waived or will waive such right
to the extent permitted by law and has consented to such relief and
enforcement as provided in Section 14 of this Agreement.
(xxiv) Consent to Jurisdiction; Appointment of Agent for
Service of Process. The Company has the power to submit, and pursuant
to this Agreement has legally, validly, effectively and irrevocably
submitted to the personal jurisdiction of any federal or state court in
the State of New York, County of New York, and has the power to
designate, appoint and empower, and pursuant to this Agreement has
legally, validly, effectively and irrevocably designated, appointed and
empowered an agent for service of process in any suit or proceeding
based on or arising under this Agreement in any federal or state court
in the State of New York, County of New York, as provided in Section
15.
(xxv) No Transaction Tax, Stamp Duty or Similar Tax or
Duty. Except as disclosed in the Prospectus, no transaction tax, stamp
duty or similar tax or duty or withholding or other taxes are payable
by or on behalf of the Underwriters or the Brazilian Managers in
connection with the sale and delivery of the Securities as contemplated
by this Agreement, the Brazilian Purchase Agreement or in connection
with the execution, delivery or enforcement of this Agreement, the
Brazilian Purchase Agreement or the Deposit Agreement or the deposit of
common shares under the Deposit Agreement, other than withholding tax
at a rate of 15% on fees and expenses payable to the Underwriters.
(xxvi) Enforceability of New York Judgment. Any final
judgment for a fixed or readily calculable sum of money rendered by any
court of the State of New York or of
12
the United States located in the State of New York having jurisdiction
under its own domestic laws in respect of any suit, action or
proceeding against the Company based upon this Agreement would be
declared enforceable against the Company by the courts of Brazil
without reexamination, review of the merits of the cause of action in
respect of which the original judgment was given or relitigation of the
matters adjudicated upon or payment of any stamp, registration or
similar tax or duty, provided that such judgment (A) is for a sum
certain, (B) fulfills all formalities required for its enforceability
in the United States, (C) is issued by a competent court after proper
service of process, (D) is not subject to appeal, (E) is authenticated
by a Brazilian consular office in the United States and is accompanied
by a sworn translation in Portuguese and (F) does not violate Brazilian
national sovereignty, public policy or "good morals" (as set forth in
Brazilian law). The Company is not aware of any reason why the
enforcement in Brazil of such a judgment in respect of this Agreement
would be contrary to public policy in Brazil or any political
subdivision thereof.
(xxvii) Investment Company Act. The Company is not, and
following the offering of the Securities as herein contemplated will
not be, required to register as an "investment company" as such term is
defined in the Investment Company Act of 1940, as amended (the "1940
Act").
(xxviii) Environmental Laws. Except as described in the
Registration Statement and except such violations as would not, singly
or in the aggregate, result in a Material Adverse Effect, (A) none of
the Company or its Subsidiaries is in violation of any Brazilian
federal, state, local or foreign statute, law, rule, regulation,
ordinance, code, policy or rule of common law and any judicial or
administrative interpretation thereof including any judicial or
administrative order, consent, decree or judgment, relating to
pollution or protection of human health, the environment (including,
without limitation, ambient air, surface water, groundwater, land
surface or subsurface strata) or wildlife, including, without
limitation, laws and regulations relating to the release or threatened
release of chemicals, pollutants, contaminants, wastes, toxic
substances, hazardous substances, petroleum or petroleum products
(collectively, "Hazardous Materials") or to the manufacture,
processing, distribution, use, treatment, storage, disposal, transport
or handling of Hazardous Materials (collectively, "Environmental
Laws"), (B) the Company and its Subsidiaries have all permits,
authorizations and approvals required under any applicable
Environmental Laws and are each in compliance with their requirements,
(C) there are no pending or threatened administrative, regulatory or
judicial actions, suits, demands, demand letters, claims, liens,
notices of noncompliance or violation, investigation or proceedings
relating to any Environmental Law against the Company or any of its
Subsidiaries and (D) there are no events or circumstances that might
reasonably be expected to form the basis of an order for clean-up or
remediation, or an action, suit or proceeding by any private party or
governmental body or agency, against or affecting the Company or any of
its Subsidiaries relating to any Hazardous Materials or the violation
of any Environmental Laws.
13
(xxix) Absence of Manipulation. None of the Company, any of
its Subsidiaries or any person acting on its or their behalf have taken
or will take any action resulting in a violation of Regulation M
("Regulation M") under the Exchange Act, or designed to cause or result
in, or that has constituted or which might reasonably be expected to
constitute, the stabilization or manipulation of the price of any
security of the Company to facilitate the sale or resale of the
Securities, in each case in violation of applicable law.
(xxx) PFIC Status. The Company is not a "passive foreign
investment company" ("PFIC") as defined in Section 1296 of the U.S.
Internal Revenue Code of 1986, as amended (the "Code") or a "foreign
personal holding company" within the meaning of Section 552 of the
Code, and the Company intends to continue to operate its business in a
manner so that it will not become a PFIC with respect to any future
fiscal year.
(xxxi) Registration Rights. There are no persons with
registration or other similar rights to have any securities registered
pursuant to the Registration Statement or otherwise registered by the
Company under the 1933 Act.
(xxxii) Exchange Controls. Except as otherwise disclosed in
the Prospectus, or in sub-paragraph (xx)(A) above, no exchange control
authorization or any other authorization, approval consent or license
of any governmental authority or agency is required for the payment by
the Company of any amounts in United States dollars pursuant to the
terms of the Deposit Agreement or ADRs.
(b) Officer's Certificates. Any certificate signed by any
officer of the Company or any of its Subsidiaries delivered to the
Representatives or to counsel for the Underwriters shall be deemed a
representation and warranty by the Company to each Underwriter as to the matters
covered thereby.
(c) Representations and Warranties by the Selling
Shareholders. Each of the Selling Shareholders represents and warrants to each
Underwriter as of the date hereof, as of the Closing Time, and as of each Date
of Delivery, if any, and agrees with each Underwriter, as follows:
(i) Accurate Disclosure. Each of the Selling Shareholders has
reviewed and is familiar with the Registration Statement and the
Prospectus, and the information contained in the Registration Statement
and the Prospectus under the headings "Major and Selling Shareholders"
and "Related Party Transactions" (insofar as such information pertains
to the Selling Shareholders) (collectively, the "Selling Shareholder
Information") does not contain any untrue statement of material fact or
omit to state any material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading, except that the
representations and warranties set forth in this paragraph shall not
apply to statements or omissions in the Registration Statement or
Prospectus made in reliance upon and in conformity with information
furnished to the Selling Shareholders in writing by any
14
Underwriter through the Representatives expressly for use in the
Registration Statement or Prospectus. The Selling Shareholders are not
prompted to sell the Common Shares to be sold by the Selling
Shareholders under this Agreement or the Brazilian Purchase Agreement
by any information concerning the Company or any Subsidiary which is
not set forth in the Prospectus.
(ii) Authorization of Agreements. Each of the Selling
Shareholders has the full right, power and authority to enter into this
Agreement and the Brazilian Purchase Agreement and to offer, sell,
transfer and deliver the Common Shares to be sold by each of the
Selling Shareholders under this Agreement and the Brazilian Purchase
Agreement. The execution and delivery of this Agreement and the
Brazilian Purchase Agreement, the sale and delivery of the Common
Shares to be sold by each of the Selling Shareholders and the
consummation of the transactions contemplated in this Agreement and the
Brazilian Purchase Agreement and compliance by each of the Selling
Shareholders with its obligations hereunder and thereunder have been
duly authorized by each of the Selling Shareholders and do not and will
not, whether with or without the giving of notice or passage of time or
both, conflict with or constitute a breach of, or default under, or
result in the creation or imposition of any tax, lien, charge or
encumbrance upon the Common Shares to be sold by each of the Selling
Shareholders pursuant to any contract, indenture, mortgage, deed of
trust, loan or credit agreement, note, license, lease or other
agreement or instrument to which any of the Selling Shareholders is a
party or by which any of the Selling Shareholders may be bound, or to
which any of the Common Shares to be sold by each of the Selling
Shareholders is subject and which conflicts or defaults would have a
material adverse effect on the ability of the Selling Shareholders to
perform its obligations hereunder or under the Brazilian Purchase
Agreement with respect to the transactions contemplated herein or
therein, nor will such action result in any violation of the provisions
of the charter or by-laws or other organizational instrument of any of
the Selling Shareholders, if applicable, or any subsidiary, or any
applicable treaty, law, statute, rule, regulation, judgment, order,
writ or decree of any government, government instrumentality or court,
domestic or foreign, having jurisdiction over any of the Selling
Shareholders or any of the Common Shares to be sold by each of the
Selling Shareholders.
(iii) Good and Marketable Title. Upon delivery of the Common
Shares to be sold by each of the Selling Shareholders under this
Agreement and the Brazilian Purchase Agreement and payment of the
purchase price therefor as contemplated herein, each of the
Underwriters and the Brazilian Managers will receive good and
marketable title to such Common Shares, free and clear of any security
interest, mortgage, pledge, lien, charge, claim, equity or encumbrance
of any kind.
(iv) Absence of Manipulation. Neither of the Selling
Shareholders nor any person acting on its behalf has taken or will take
any action resulting in a violation of Regulation M, or designed to
cause or result in, or that has constituted or which might reasonably
be expected to constitute, the stabilization or manipulation of the
price of any
15
security of the Company to facilitate the sale or resale of the
Securities, in each case in violation of applicable law.
(v) Absence of Further Requirements. Except for approvals (A)
from the Central Bank and the CVM relating to the Deposit Agreement and
the Custody Agreement under Annex V to Resolution No. 1,289 of March
20, 1987, as amended of the CMN, (B) from the CVM for the offering of
the Brazilian Securities and the Common Shares underlying the ADSs as
provided for in the Transaction Documents, (C) from the Central Bank
for the payment of the fees and commissions contemplated by this
Agreement and the Deposit Agreement, (D) from the Commission as may be
required under the 1933 Act or the 1933 Act Regulations, and (E) as may
be required under the blue sky laws of any jurisdiction in the United
States in connection with the purchase and distribution of the ADSs by
the Underwriters, all of which have been duly obtained or will be duly
obtained prior to the Closing Time, no filing with, or authorization,
approval, consent, license, order, registration, qualification or
decree of, any court or governmental authority or agency is necessary
or required for the performance by each of the Selling Shareholders of
its obligations hereunder, in connection with the offering, issuance or
sale of the ADSs under this Agreement or the offering, issuance or sale
of Common Shares under the Brazilian Purchase Agreement or the
consummation of the transactions contemplated by this Agreement and the
Brazilian Purchase Agreement.
(vi) Certificates Suitable for Transfer. Certificates for all
of the Common Shares to be sold by each of the Selling Shareholders
pursuant to this Agreement, in suitable form for transfer by delivery
or accompanied by duly executed instruments of transfer or assignment
in blank with signatures guaranteed, have been placed in custody with
Banco Bradesco or its agent with irrevocable conditional instructions
to deliver such Common Shares to the Depositary pursuant to this
Agreement.
(vii) No Association with NASD. Neither the Selling
Shareholders nor any of their affiliates directly, or indirectly
through one or more intermediaries, controls, or is controlled by, or
is under common control with, or has any other association with (within
the meaning of Article I, Section 1(m) of the By-laws of the National
Association of Securities Dealers, Inc.), any member firm of the
National Association of Securities Dealers, Inc.
(viii) Consent to Jurisdiction; Appointment of Agent for
Service of Process. BNDES, acting solely in its own capacity, has the
power to submit, and pursuant to this Agreement has legally, validly,
effectively and irrevocably submitted to the personal jurisdiction of
any federal or state court in the State of New York, County of New
York, and has the power to designate, appoint and empower, and pursuant
to this Agreement has legally, validly, effectively and irrevocably
designated, appointed and empowered an agent for service of process in
any suit or proceeding based on or arising under this Agreement or the
Brazilian Purchase Agreement in any federal or state court in the State
of New York, County of New York, as provided in Section 14 of this
Agreement.
16
(ix) No Transaction Tax, Stamp Duty or Similar Tax or Duty. No
transaction tax, stamp duty or similar tax or duty or withholding or
other taxes are payable by or on behalf of the Underwriters in
connection with the sale and delivery of the Securities as contemplated
by this Agreement or the Brazilian Purchase Agreement or in connection
with the execution, delivery or enforcement of this Agreement or the
Brazilian Purchase Agreement, other than withholding tax at a rate of
15% on fees and expenses payable to the Underwriters.
(x) Enforceability of New York Judgment. Any final judgment
for a fixed or readily calculable sum of money rendered by any court of
the State of New York or of the United States located in the State of
New York having jurisdiction under its own domestic laws in respect of
any suit, action or proceeding against BNDES, acting in its own
capacity, based upon this Agreement or the Brazilian Purchase Agreement
would be declared enforceable against BNDES by the courts of Brazil
without reexamination, review of the merits of the cause of action in
respect of which the original judgment was given or relitigation of the
matters adjudicated upon or payment of any stamp, registration or
similar tax or duty other than court fees, provided that the judgment
(A) is for a payment of a sum certain; (B) fulfills all formalities
required for its enforceability under the laws of the country where it
was issued; (C) was issued by a competent court after service of
process on BNDES, or after sufficient evidence of the absence of BNDES
has been given, as required under applicable law; (D) is not subject to
appeal; (E) was authenticated by a Brazilian Consulate in the country
in which it was issued and is accompanied by a sworn translation into
Portuguese; and (F) is not against Brazilian national sovereignty,
public policy or morality.
(xi) Good Standing. BNDES has been duly organized and is
validly existing as a stock corporation in good standing under the laws
of Brazil and has corporate power and authority to own, lease and
operate its properties and to conduct its business and to enter into
and perform its obligations under this Agreement, except where the
failure so to be in good standing would not result in a material
adverse change in the condition, financial or otherwise, or in the
earnings, business affairs or business prospects of BNDES and its
subsidiaries considered as one enterprise, whether or not arising in
the ordinary course of business.
(xii) Absence of Proceedings. There is no action suit,
proceeding, inquiry or investigation before or brought by any court or
governmental agency or body, domestic or foreign, now pending, or, to
the knowledge of each of the Selling Shareholders, threatened, against
or affecting any of the Selling Shareholders or any subsidiary which
might reasonably be expected to result in a Material Adverse Effect, or
which might reasonably be expected to materially and adversely affect
the properties or assets thereof or the consummation of the
transactions contemplated in this Agreement and the Brazilian Purchase
Agreement or the performance by any of the Selling Shareholders of its
obligations hereunder or thereunder; the aggregate of all pending legal
or governmental proceedings to which the Selling Shareholders or any
subsidiary is a party
17
or of which any of their respective property or assets is the subject,
including ordinary routine litigation incidental to the business, could
not reasonably be expected to result in a Material Adverse Effect.
(d) Officer's Certificates. Any certificate signed by or on
behalf of any of the Selling Shareholders as such and delivered to the
Representatives or to counsel for the Underwriters pursuant to the terms of this
Agreement shall be deemed a representation and warranty by the respective
Selling Shareholder to the Underwriters as to the matters covered thereby.
SECTION 2. Sale and Delivery to Underwriters; Closing.
(a) Initial Securities. On the basis of the representations
and warranties herein contained and subject to the terms and conditions herein
set forth, the Selling Shareholders agree to sell to each Underwriter, severally
and not jointly, and each Underwriter, severally and not jointly, agrees to
purchase from the Selling Shareholders, at the price per ADS set forth in
Schedule C, the number of Initial Securities set forth in Schedule A opposite
the name of such Underwriter, plus any additional number of Initial Securities
which such Underwriter may become obligated to purchase pursuant to the
provisions of Section 10 hereof, subject to such adjustments among the
Underwriters as the Representatives in their sole discretion shall make to
eliminate any sales or purchases of fractional securities.
(b) Option Securities. In addition, on the basis of the
representations and warranties herein contained and subject to the terms and
conditions herein set forth, each of the Selling Shareholders on a pro rata
basis hereby grants an option to the Underwriters, severally and not jointly, to
purchase up to an additional - ADSs, as set forth in Schedule B, at the
price per ADS set forth in Schedule C, less an amount per ADS equal to any
dividends or distributions declared by the Company and payable on the Initial
Securities but not payable on the Option Securities. The option hereby granted
will expire 30 days after the date hereof and may be exercised in whole or in
part from time to time only for the purpose of covering over-allotments which
may be made in connection with the offering and distribution of the Initial
Securities upon notice by the Global Coordinators to each of the Selling
Shareholders setting forth the number of Option Securities as to which the
several Underwriters are then exercising the option and the time and date of
payment and delivery for such Option Securities. Any such time and date of
delivery (each, a "Date of Delivery") shall be determined by the Global
Coordinators, but shall not be later than seven full business days after the
exercise of said option nor prior to two days after receipt of such notice of
exercise and, in any event, shall not be prior to the Closing Time, as
hereinafter defined. If the option is exercised as to all or any portion of the
Option Securities, each of the Underwriters, acting severally and not jointly,
will purchase that proportion of the total number of Option Securities then
being purchased which the number of Initial Securities set forth in Schedule A
opposite the name of such Underwriter bears to the total number of Initial
Securities.
18
(c) Payment. Payment of the purchase price for, and delivery
of certificates for, the Initial Securities shall be made at the offices of
Shearman & Sterling, 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 or at such
other place as shall be agreed upon by the Global Coordinators, the Company and
the Selling Shareholders, at 10:00 a.m. (Eastern Time) on the fifth business day
after the date hereof (unless postponed in accordance with the provisions of
Section 10), or such other time not later than ten business days after such date
as shall be agreed upon by the Global Coordinators, the Company and the Selling
Shareholders (such time and date of payment and delivery being herein called the
"Closing Time").
In addition, in the event that any or all of the Option
Securities are purchased by the Underwriters, payment of the purchase price for,
and delivery of certificates for, such Option Securities shall be made at the
above-mentioned offices, or at such other place as shall be agreed upon by the
Global Coordinators, the Company and the Selling Shareholders, on each Date of
Delivery as specified in the notice from the Global Coordinators to the Company
and the Selling Shareholders.
Payment shall be made to [each of] the Selling Shareholders by
wire transfer of immediately available funds to a bank account designated by
[each of] the Selling Shareholders, against delivery to the Representatives for
the respective accounts of the Underwriters of certificates for the Global
Securities to be purchased by them. It is understood that each Underwriter has
authorized the Representatives, for its account, to accept delivery of, receipt
for, and make payment of the purchase price for, the Initial Securities and the
Option Securities, if any, which it has agreed to purchase. Xxxxxxx Xxxxx and
Xxxxxxxxxx, each acting individually and not as representatives of the
Underwriters, may (but shall not be obligated to) make payment of the purchase
price for the Initial Securities or the Option Securities, if any, to be
purchased by any Underwriter whose funds have not been received by the Closing
Time or the relevant Date of Delivery, as the case may be, but such payment
shall not relieve any such Underwriter from its obligations hereunder.
(d) Denominations; Registration; Delivery of ADRs.
Certificates for the Initial Securities and the Option Securities, if any, shall
be in such denominations and registered in such names as the Representatives may
request in writing at least one full business day before the Closing Time or the
relevant Date of Delivery, as the case may be. The certificates for the Initial
Securities and the Option Securities, if any, will be made available for
examination and packaging by the Representatives in The City of New York not
later than 10:00 a.m. (Eastern Time) on the business day prior to the Closing
Time or the relevant Date of Delivery, as the case may be.
The ADRs evidencing ADSs shall be delivered to the
Representatives at the Closing Time or the Date of Delivery, as the case may be,
for the respective accounts of the several Underwriters, with any transfer,
stamp or similar taxes or any withholding or other taxes payable in connection
with the initial delivery of the ADRs, ADSs or Common Shares to the
Underwriters, the Depositary or the persons in whose names the U.S.
Representatives have requested ADRs evidencing ADSs to be initially issued at
the Closing Time or the Date of
19
Delivery, as the case may be, duly paid by the Selling Shareholders against
payment of the purchase price thereof in accordance with this Section 2. Any
transfer taxes or stamp duties or any withholding or other taxes payable on any
transfer subsequent to the delivery of ADRs in accordance with this Section 2
shall not be the responsibility of the Selling Shareholders [or the Company].
SECTION 3. Covenants.
(a) Covenants of the Company. The Company covenants with each
Underwriter as follows:
(i) Compliance with Securities Regulations and Commission
Requests. The Company, subject to Section 3(b), will comply with the
requirements of Rule 430A and will notify the Global Coordinators
promptly, and confirm the notice in writing, (A) when any
post-effective amendment to the Registration Statement or the ADR
Registration Statement shall become effective, or any supplement to the
Prospectus or any amended Prospectus shall have been filed, (B) of the
receipt of any comments from the Commission, (C) of any request by the
Commission for any amendment to the Registration Statement or the ADR
Registration Statement or any amendment or supplement to the Prospectus
or for additional information, (D) of the issuance by the Commission of
any stop order suspending the effectiveness of the Registration
Statement or the ADR Registration Statement or of any order preventing
or suspending the use of any preliminary prospectus, or of the
suspension of the qualification of the Global Securities for offering
or sale in any jurisdiction, or of the initiation or threatening of any
proceedings for any of such purposes and (E) of the receipt by the
Company of any notification with respect to any suspension of the
qualification of the ADSs for offer and sale in any jurisdiction or the
instruction or threatening of any proceeding for such purpose. The
Company will promptly effect the filings necessary pursuant to Rule
424(b) and will take such steps as it deems necessary to ascertain
promptly whether the form of prospectus transmitted for filing under
Rule 424(b) was received for filing by the Commission and, in the event
that it was not, it will promptly file such prospectus. The Company
will make every reasonable effort to prevent the issuance of any stop
order and, if any stop order is issued, to obtain the lifting thereof
at the earliest possible moment.
(ii) Filing of Amendments. The Company will give the Global
Coordinators notice of its intention to file any amendment to the
Registration Statement (including any filing under Rule 462(b)) or the
ADR Registration Statement or any amendment, supplement or revision to
either the prospectus included in the Registration Statement at the
time it became effective or to the Prospectus, whether pursuant to the
1933 Act, the 1934 Act or otherwise, will furnish the Global
Coordinators with copies of any such documents a reasonable amount of
time prior to such proposed filing or use, as the case may be, and will
not file or use any such document to which the Global Coordinators or
counsel for the Underwriters shall object.
20
(iii) Delivery of Registration Statements. The Company has
furnished or will deliver to the Representatives and counsel for the
Underwriters, without charge, signed photocopies of the Registration
Statement and the ADR Registration Statement as originally filed and of
each amendment thereto (including exhibits filed therewith) and signed
photocopies of all consents and certificates of experts, and will also
deliver to the Representatives, without charge, a conformed copy of
each of the Registration Statement and the ADR Registration Statement
as originally filed and of each amendment thereto (without exhibits)
for each of the Underwriters.
(iv) Delivery of Prospectus. The Company has delivered to each
Underwriter, without charge, as many copies of the preliminary
prospectus as such Underwriter reasonably requested, and the Company
hereby consents to the use of such copies for purposes permitted by the
1933 Act. The Company will furnish to each Underwriter, without charge,
during the period when the Prospectus is required to be delivered under
the 1933 Act or the 1934 Act, such number of copies of the Prospectus
(as amended or supplemented) as such Underwriter may reasonably
request.
(v) Continued Compliance with Securities Laws. The Company
will comply with the 1933 Act and the 1933 Act Regulations and the 1934
Act and the 1934 Act Regulations, Brazilian law and the rules and
regulations of the New York Stock Exchange, Inc. (the "New York Stock
Exchange") so as to permit the completion of the distribution of the
Global Securities as contemplated in this Agreement and in the
Prospectus. If at any time when a prospectus is required by the 1933
Act to be delivered in connection with sales of the Global Securities,
any event shall occur or condition shall exist as a result of which it
is necessary, in the opinion of counsel for the Underwriters, to amend
the Registration Statement or the ADR Registration Statement or amend
or supplement any Prospectus in order that such Prospectus will not
include any untrue statements of a material fact or omit to state a
material fact necessary in order to make the statements therein not
misleading in the light of the circumstances existing at the time it is
delivered to a purchaser, or if it shall be necessary, in the opinion
of such counsel, at any such time to amend the Registration Statement
or the ADR Registration Statement or amend or supplement any Prospectus
in order to comply with the requirements of the 1933 Act or the 1933
Act Regulations or the requirements of any Brazilian authority, the
Company will promptly prepare and file with the Commission, subject to
Section 3(b), such amendment or supplement as may be necessary to
correct such statement or omission or to make the Registration
Statement or the ADR Registration Statement or the Prospectus comply
with such requirements, and the Company will furnish to the
Underwriters such number of copies of such amendment or supplement as
the Underwriters may reasonably request.
(vi) Blue Sky Qualifications. The Company will use its best
efforts, in cooperation with the Underwriters, to qualify the ADSs and
the Common Shares for offering and sale under the applicable securities
laws of such states and other jurisdictions (domestic or foreign) as
the Global Coordinators may designate and to
21
maintain such qualifications in effect for a period of not less than
one year from the later of the effective date of the Registration
Statement and any Rule 462(b) Registration Statement; 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. In each
jurisdiction in which the Global Securities have been so qualified, the
Company will file such statements and reports as may be required by the
laws of such jurisdiction to continue such qualification in effect for
a period of not less than one year from the effective date of the
Registration Statement and any Rule 462(b) Registration Statement.
(vii) Rule 158. The Company will timely file such reports
pursuant to the 1934 Act as are necessary in order to make generally
available to its security holders as soon as practicable an earnings
statement for the purposes of, and to provide the benefits contemplated
by, the last paragraph of Section 11(a) of the 1933 Act.
(viii) Listing. The Company will use its best efforts to
effect the listing of the ADSs on the New York Stock Exchange and will
file with the New York Stock Exchange all documents and notices
required by such stock exchange.
(ix) Restriction on Sale of Securities. During a period of 120
days from the date hereof, the Company will not, without the prior
written consent of the Global Coordinators, directly or indirectly (i)
offer, pledge, sell, contract to sell any ADSs or Common Shares, (ii)
sell any option or contract to purchase any ADSs or Common Shares,
(iii) purchase any option or contract to sell any ADSs or Common
Shares, (iv) grant any option, right or warrant for the sale of any
ADSs or Common Shares, (v) lend or otherwise dispose of or transfer any
ADSs or Common Shares, (vi) file any registration statement under the
1933 Act with respect to any of the foregoing, or (vii) enter into any
swap or any other agreement or any transaction that transfers, in whole
or in part, directly or indirectly, the economic consequence of
ownership of any ADSs or Common Shares represented thereby, whether any
such swap or transaction is to be settled by delivery of ADSs or Common
Shares represented thereby, or such other securities, in cash or
otherwise. The foregoing provisions (A) apply to (x) Common Shares and
securities convertible into or exchangeable or exercisable for or
repayable with Common Shares and (y) Common Shares and preferred shares
owned now or acquired later by the person executing the agreement or
for which person executing the agreement later acquires the power of
disposition (B) shall not apply to (x) the Securities to be sold
hereunder or under the Brazilian Purchase Agreement, (y) any Common
Shares issued or options to purchase Common Shares granted pursuant to
existing employee benefit plans of the Company referred to in the
Prospectus or (z) any Common Shares issued pursuant to any non-employee
director stock plan or dividend reinvestment plan. The Global
Coordinators may, in their sole discretion, release all or any portion
of the ADSs or Common Shares subject to the foregoing restriction prior
to the expiration of the 120-day term.
22
(x) Other Documents. The Company will furnish to the
Depositary and to holders of ADRs, directly or through the Depositary,
such reports, documents and other information described in the
Prospectus under the caption "Where You Can Find More Information" in
accordance with the procedures stated thereunder.
(xi) Delivery Requirements. For a period of five years from
the Closing Time, the Company will furnish to the Representatives
copies of all reports or other communications (financial or otherwise)
furnished to holders of ADSs, and copies of any reports any financial
statements furnished to or filed with the Commission, the CVM, the New
York Stock Exchange, the Sao Paulo Stock Exchange or any national
securities exchange.
(xii) Reporting Requirements. The Company, during the period
when the Prospectus is required to be delivered under the 1933 Act or
the 1934 Act, will file all documents required to be filed with the
Commission pursuant to the 1934 Act within the time periods required by
the 1934 Act and the 1934 Act Regulations.
(xiii) Taxes and Fees. The Company agrees to indemnify and
hold harmless the Underwriters against any documentary, stamp or
similar transfer or issue tax, or fees, including any interest and
penalties, which are or may be required to be paid on or in connection
with the creation, offer and distribution of the Common Shares or ADSs
or on the execution or delivery of this Agreement or the Brazilian
Purchase Agreement.
(xiv) Submission of Documents. For so long as the Common Stock
or ADSs are outstanding, the Company agrees to file with the CVM, the
New York Stock Exchange, [SEAQ International], the Sao Paulo Stock
Exchange and any other governmental agency, authority or
instrumentality in Brazil as may be required, such reports, documents,
agreements and other information which may from time to time be
required to be so filed including the declaration and payment of
dividends or other distributions on the Common Shares or ADSs.
(xv) [PFIC Classification. The Company hereby agrees to take
all such actions as are necessary to prevent the Company from being
classified as a PFIC; if the Company is ever classified as a PFIC, it
will comply with the reporting and other requirements of Subparts A, B
and C of Part VI of Subchapter P of the Code.]
(b) Covenants of the Selling Shareholders. Each Selling
Shareholder covenants with each Underwriter that:
(i) Deposit of Common Shares. Prior to the Closing Time and
each Date of Delivery, it will deposit or cause to be deposited Common
Shares with the Depositary in accordance with the provisions of the
Deposit Agreement so that the ADRs evidencing the ADSs to be delivered
by such party to the Underwriters at such Closing Time or Date of
Delivery are executed, countersigned and issued by the Depositary
against receipt of
23
such Common Shares and delivered to the Underwriters at such Closing
Time or Date of Delivery.
(ii) Indemnification for Stamp Taxes. Each of the Selling
Shareholders agrees to indemnify and hold harmless the Underwriters
against any documentary, stamp or similar transfer or issue tax, or
fees, including any interest and penalties, which are or may be
required to be paid on or in connection with the creation, offer and
distribution of the Common Shares or ADSs and initial resale thereof by
the Underwriters or on the execution or delivery of this Agreement or
the Brazilian Purchase Agreement.
(iii) Restriction on Sale of Securities. During a period of
120 days from the date hereof, each of the Selling Shareholders will
not, without the prior written consent of the Global Coordinators,
directly or indirectly, (i) offer, pledge, sell, contract to sell any
ADSs or Common Shares, (ii) sell any option or contract to purchase any
ADSs or Common Shares, (iii) purchase any option or contract to sell
any ADSs or Common Shares, (iv) grant any option, right or warrant for
the sale of any ADSs or Common Shares, (v) lend or otherwise dispose of
or transfer any ADSs or Common Shares, (vi) file any registration
statement under the 1933 Act with respect to any of the foregoing, or
(vii) enter into any swap or any other agreement or any transaction
that transfers, in whole or in part, directly or indirectly, the
economic consequence of ownership of any ADSs or Common Shares
represented thereby, whether any such swap or transaction is to be
settled by delivery of ADSs or Common Shares represented thereby, or
such other securities, in cash or otherwise. The foregoing provisions
(A) apply to (x) Common Shares and securities convertible into or
exchangeable or exercisable for or repayable with Common Shares and (y)
Common Shares and preferred shares owned now or acquired later by the
person executing the agreement or for which the person executing the
agreement later acquires the power of disposition (B) shall not apply
to (x) the Securities to be sold hereunder or under the Brazilian
Purchase Agreement or (y) those preferred shares of the Company held by
BNDESPAR, a wholly owned subsidiary of BNDES, which may be contributed
to an investment fund intended to track the Sao Paulo Stock Exchange
Index. The Global Coordinators may, in their sole discretion, release
all or any portion of the ADSs or Common Shares subject to the
foregoing restriction prior to the expiration of the 120-day term.
SECTION 4. Payment of Expenses.
(a) Expenses. The Company will pay the fees and disbursements
of the Company's counsel, accountants and other advisors.
(b) Expenses of the Selling Shareholders. The Selling Shareholders
will pay (i) any stamp duties, capital duties and stock transfer taxes, if any,
payable upon the sale of the Global Securities to the Underwriters, and their
transfer between the Underwriters pursuant to an agreement between such
Underwriters, and (ii) the fees and disbursements of the Selling Shareholders'
counsel.
24
(c) Termination of Agreement. If this Agreement is terminated by the
Representatives in accordance with the provisions of Section 5, Section 9(a)(i)
or Section 11 hereof, the [Company and the] Selling Shareholders shall reimburse
the Underwriters for all of their out-of-pocket expenses, including the
reasonable fees and disbursements of counsel for the Underwriters.
(d) Other Agreements with Respect to Expenses. The provisions of
this Section shall not affect or be affected by any agreement between the
Company and the Selling Shareholders with respect to the payment of expenses.
SECTION 5. Conditions of Underwriters' Obligations. The
obligations of the several Underwriters hereunder are subject to the accuracy of
the representations and warranties of the Company and each of the Selling
Shareholders contained in Section 1 hereof or in certificates of any officer of
the Company or its Subsidiaries or on behalf of any of the Selling Shareholders
delivered pursuant to the provisions hereof, to the performance by the Company
and each of the Selling Shareholders of their covenants and other obligations
hereunder, and to the following further conditions:
(a) Effectiveness of Registration Statement. The Registration
Statement, including any Rule 462(b) Registration Statement, and the
ADR Registration Statement shall have become effective and at the
Closing Time no stop order suspending the effectiveness of the
Registration Statement or the ADR Registration Statement shall have
been issued under the 1933 Act or proceedings therefor initiated or
threatened by the Commission, and any request on the part of the
Commission for additional information shall have been complied with to
the reasonable satisfaction of counsel to the Underwriters. A
prospectus containing the Rule 430A Information shall have been filed
with the Commission in accordance with Rule 424(b) (or a post-effective
amendment providing such information shall have been filed and declared
effective in accordance with the requirements of Rule 430A).
(b) Opinion of Brazilian Counsel for Company. At the Closing
Time, the Representatives shall have received the opinion, dated as of
the Closing Time, of Dr. Paulo Xxxxxxxxx xx Xxxxxxx Xxxxx, general
counsel for the Company, in form and substance satisfactory to counsel
for the Underwriters, together with signed or reproduced copies of such
letter for each of the other Underwriters to the effect set forth in
Exhibit A hereto and to such further effect as counsel to the
Underwriters may reasonably request.
(c) Opinion of Special U.S. Counsel for Company. At the
Closing Time, the Representatives shall have received the opinion,
dated as of the Closing Time, of Xxxxx Xxxx & Xxxxxxxx, special U.S.
counsel for the Company, in form and substance satisfactory to counsel
for the Underwriters, together with signed or reproduced copies of such
letter for each of the other Underwriters to the effect set forth in
Exhibit B hereto and to such further effect as counsel for the
Underwriters may reasonably request.
25
(d) Opinion of Brazilian Counsel for Selling Shareholders. At
the Closing Time, the Representatives shall have received the opinion,
dated as of the Closing Time, of _____________ counsel for the Selling
Shareholders, in form and substance satisfactory to counsel for the
Underwriters, together with signed or reproduced copies of such letter
for each of the other Underwriters to the effect set forth in Exhibit C
hereto and to such further effect as counsel for the Underwriters may
reasonably request.
(e) Opinion of Special U.S. Counsel for Selling Shareholders.
At the Closing Time, the Representatives shall have received the
opinion, dated as of the Closing Time, of Xxxxxx & Xxxxxx, special U.S.
counsel for the Selling Shareholders, in form and substance
satisfactory to counsel for the Underwriters, together with signed or
reproduced copies of such letter for each of the other Underwriters to
the effect set forth in Exhibit D hereto and to such further effect as
counsel for the Underwriters may reasonably request. In rendering such
opinion, such counsel may (i) rely, as to matters involving the
application of the laws of Brazil, upon the opinion of Brazilian
counsel to the Selling Shareholders and, as to matters of fact, may
rely to the extent such counsel deems proper on certificates of
responsible officers of the Selling Shareholders and public officials
and (ii) state that such counsel expresses no opinion as to the laws of
any jurisdiction other than the laws of the State of New York and the
federal laws of the United States.
(f) Opinion of Counsel for Depositary. At the Closing Time,
the Representatives shall have received the opinion, dated as of the
Closing Time, of Xxxxxxx, Xxxxxxx & Xxxxxx, counsel for the Depositary,
in form and substance satisfactory to counsel for the Underwriters,
together with signed or reproduced copies of such letter for each of
the other Underwriters to the effect set forth in Exhibit E hereto and
to such further effect counsel for the Underwriters may reasonably
request.
(g) Opinion of Brazilian Counsel for Underwriters. At the
Closing Time, the Representatives shall have received the favorable
opinion, dated as of the Closing Time, of Xxxxxx Filho, Xxxxx Filho,
Marrey Jr. e Xxxxxxx Advogados, local counsel for the Underwriters in
Brazil, with respect to the incorporation, legal existence and legal
enforceability of the ADSs, the Transaction Documents, the Prospectus
and such other related matters as the Representatives may require. In
giving such opinion such counsel may rely, as to all matters governed
by the laws of jurisdictions other than the law of Brazil, upon the
opinions of counsel satisfactory to the Representatives. Such counsel
may also state that, insofar as such opinion involves factual matters,
they have relied, to the extent they deem proper, upon certificates of
officers of the Company and certificates of public officials.
(h) Opinion of U.S. Counsel for Underwriters. At the Closing
Time, the Representatives shall have received the favorable opinion,
dated as of the Closing Time, of Shearman & Sterling, U.S. counsel for
the Underwriters, with respect to the Transaction Documents other than
the Brazilian Purchase Agreement, the Prospectus and such other related
matters as the Representatives may require. In giving such opinion
26
such counsel may rely, as to all matters governed by the laws of
jurisdictions other than the law of the State of New York and the
federal law of the United States, upon the opinions of counsel
satisfactory to the Representatives. Such counsel may also state that,
insofar as such opinion involves factual matters, they have relied, to
the extent they deem proper, upon certificates of officers of the
Company or its Subsidiaries and certificates of public officials.
(i) Officers' Certificate. At the Closing Time, there shall
not have been, since the date hereof or since the respective dates as
of which information is given in the Prospectus, any material adverse
change in the condition, financial or otherwise, or in the earnings,
business affairs or business prospects of the Company and its
Subsidiaries considered as one enterprise, whether or not arising in
the ordinary course of business, and the Representatives shall have
received a certificate of (x) an executive officer or duly authorized
attorney-in-fact of the Company and (y) the chief financial or chief
accounting officer of the Company, dated as of the Closing Time, to the
effect that (i) there has been no such material adverse change, (ii)
the representations and warranties in Section 1(a) hereof are true and
correct with the same force and effect as though expressly made at and
as of the Closing Time, (iii) the Company has complied with all
agreements and satisfied all conditions on its part to be performed or
satisfied under this Agreement and the Brazilian Purchase Agreement at
or prior to the Closing Time, and (iv) no stop order suspending the
effectiveness of the Registration Statement or the ADR Registration
Statement has been issued and no proceedings for that purpose have been
instituted or are pending or, to the knowledge of the person making
such statement, contemplated by the Commission.
(j) Certificate of Selling Shareholders. At the Closing Time,
the Representatives shall have received a certificate of an executive
officer of each of Brazil and BNDES, dated as of the Closing Time, to
the effect that (i) the representations and warranties of each of
Brazil and BNDES, respectively, contained in Section 1(b) hereof are
true and correct in all respects with the same force and effect as
though expressly made at and as of the Closing Time and (ii) each of
Brazil and BNDES, respectively, has complied with all agreements and
all conditions on its part to be performed or satisfied under this
Agreement and the Brazilian Purchase Agreement at or prior to the
Closing Time.
(k) Accountant's Comfort Letter. At the time of the execution
of this Agreement, the Representatives shall have received from
PricewaterhouseCoopers Auditores Independentes a letter dated such
date, in form and substance satisfactory to the Representatives,
together with signed or reproduced copies of such letter for each of
the other Underwriters 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.
27
(l) Bring-down Comfort Letter. At the Closing Time, the
Representatives shall have received from PricewaterhouseCoopers
Auditores Independentes a letter, dated as of the Closing Time, to the
effect that they reaffirm the statements made in the letter furnished
pursuant to paragraph (k) of this Section, except that the specified
date referred to shall be a date not more than three business days
prior to the Closing Time.
(m) Deposit Agreement. The Company and the Depositary shall
have executed and delivered the Deposit Agreement substantially in the
form filed as an exhibit to the ADR Registration Statement, and the
Deposit Agreement shall be in full force and effect.
(n) Certificate of Depositary. At the Closing Time, the
Underwriters shall have received a certificate of the Depositary,
satisfactory to the Underwriters, of one of its authorized officers
with respect to the deposit with the custodian under the Depositary
Agreement of the Common Shares underlying the ADSs to be purchased
against issuance of the ADRs evidencing such ADSs, the execution,
issuance, countersignature and delivery of the ADRs evidencing such
ADSs pursuant to the Deposit Agreement and such other matters related
thereto as the Underwriters reasonably request.
(o) Depositary Information. At the Closing Time, the
Depositary shall have delivered to the Company a letter confirming the
furnishing of certain information about the Depositary for inclusion in
the Prospectus.
(p) DTC Approval. The Depository Trust Company shall have
approved the form of the ADRs.
(q) Company Documents. On or prior to the Closing Time, there
shall have been delivered to the Representatives on behalf of the
Underwriters a copy, certified by a duly authorized signatory of the
Company, of (i) the charter documents and by-laws of the Company, as
amended, and (ii) all resolutions of the shareholders and the board of
directors of the Company authorizing (x) the offering and the issuance
of the ADSs and (y) the execution of this Agreement, the Brazilian
Purchase Agreement and the Deposit Agreement and the entry into and
performance of the transactions contemplated thereby.
(r) Selling Shareholder Documents. On or prior to the Closing
Time, there shall have been delivered to the Representatives on behalf
of the Underwriters (A) a copy, certified by a duly authorized
signatory of BNDES, of (i) the charter documents and by-laws of BNDES,
as amended, and (ii) all resolutions of the board of directors of
BNDES, on behalf of itself and on behalf of Brazil, authorizing (x) the
offering of the ADSs and (y) the execution of this Agreement and the
Brazilian Purchase Agreement and the entry into and performance of the
transactions contemplated thereby.
(s) Approval of Listing. At the Closing Time, the ADSs shall
have been approved for listing on the New York Stock Exchange, subject
only to official notice of issuance.
28
(t) No Objection. The NASD shall have communicated to counsel
for the Underwriters its determination to raise no objections with
respect to the fairness and reasonableness of the underwriting terms
and arrangements.
(u) Lock-up Agreement. At the date of this Agreement, the
Representatives shall have received agreements substantially in the
form of Exhibit F hereto signed by the persons listed on Schedule E
hereto and, as of the Closing Time, such agreement shall be in full
force and effect.
(v) Purchase of the Brazilian Securities. Contemporaneously
with the purchase by the Underwriters of the Initial Securities under
this Agreement, the Brazilian Managers shall have agreed to place the
Brazilian Securities under the Brazilian Purchase Agreement.
(w) Conditions to Purchase of Option Securities. In the event
that the Underwriters exercise their option provided in Section 2(b)
hereof to purchase all or any portion of the Option Securities, the
representations and warranties of the Company and the Selling
Shareholders contained herein and the statements in any certificates
furnished by the Company, its Subsidiaries or any of the Selling
Shareholders hereunder shall be true and correct as of each Date of
Delivery and, at the relevant Date of Delivery, the Representatives
shall have received:
(i) Officers' Certificate. A certificate, dated such
Date of Delivery, of (x) an executive officer or duly
authorized attorney-in-fact of the Company and (y) the chief
financial or chief accounting officer of the Company
confirming that the certificate delivered at the Closing Time
pursuant to Section 5(i) hereof remains true and correct as of
such Date of Delivery.
(ii) Certificate of Selling Shareholders. A
certificate, dated such Date of Delivery, of an executive
officer of BNDES, on behalf of each of the Selling
Shareholders, confirming that the certificate delivered at the
Closing Time pursuant to Section 5(j) hereof remains true and
correct as of such Date of Delivery.
(iii) Opinion of Brazilian Counsel for Company. The
opinion of Dr. Paulo Xxxxxxxxx xx Xxxxxxx Xxxxx, general
counsel for the Company, in form and substance satisfactory to
counsel for the Underwriters, dated such Date of Delivery,
relating to the Option Securities to be purchased on such Date
of Delivery and otherwise to the same effect as the opinion
required by Section 5(b) hereof.
(iv) Opinion of Special U.S. Counsel for Company. The
opinion of Xxxxx Xxxx & Xxxxxxxx, counsel for the Company, in
form and substance satisfactory to counsel for the
Underwriters, dated such Date of Delivery, relating
29
to the Option Securities to be purchased on such Date of
Delivery and otherwise to the same effect as the opinion
required by Section 5(c) hereof.
(v) Opinion of Brazilian Counsel for Selling
Shareholders. The opinion of _____________, Brazilian counsel
for the Selling Shareholders, in form and substance
satisfactory to counsel for the Underwriters, dated such Date
of Delivery, relating to the Option Securities to be purchased
on such Date of Delivery and otherwise to the same effect as
the opinion required by Section 5(d) hereof.
(vi) Opinion of Special U.S. Counsel for Selling
Shareholders. The opinion of Xxxxxx & Xxxxxx, counsel for the
Selling Shareholders, in form and substance satisfactory to
counsel for the Underwriters, dated such Date of Delivery,
relating to the Option Securities to be purchased on such Date
of Delivery and otherwise to the same effect as the opinion
required by Section 5(e) hereof.
(vii) Opinion of Counsel for Depositary. The opinion
of Xxxxxxx, Xxxxxxx & Xxxxxx, counsel for the Depositary, in
form and substance satisfactory to counsel for the
Underwriters, dated such Date of Delivery, relating to the
Option Securities to be purchased on such Date of Delivery and
otherwise to the same effect as the opinion requested by
Section 5(f) hereof.
(viii) Opinion of Brazilian Counsel for Underwriters.
The opinion of Xxxxxx Filho, Xxxxx Filho, Marrey Jr. e Xxxxxxx
Advogados, Brazilian counsel for the Underwriters, dated such
Date of Delivery, relating to the Option Securities to be
purchased on such Date of Delivery and otherwise to the same
effect as the opinion requested by Section 5(g) hereof.
(ix) Opinion of U.S. Counsel for Underwriters. The
opinion of Shearman & Sterling, U.S. counsel for the
Underwriters, dated such Date of Delivery, relating to the
Option Securities to be purchased on such Date of Delivery and
otherwise to the same effect as the opinion required by
Section 5(h) hereof.
(x) Bring-down Comfort Letter. A letter from
PricewaterhouseCoopers Auditores Independentes, in form and
substance satisfactory to the Representatives and dated such
Date of Delivery, substantially in the same form and substance
as the letter furnished to the Representatives pursuant to
Section 5(k) hereof, except that the "specified date" in the
letter furnished pursuant to this paragraph shall be a date
not more than five days prior to such Date of Delivery.
(x) Additional Documents. At the Closing Time and at each Date
of Delivery, counsel for the Underwriters shall have been furnished
with such documents and opinions
30
as they may require for the purpose of enabling them to pass upon the
issuance and sale of the Securities as herein contemplated, or in order
to evidence the accuracy of any of the representations or warranties,
or the fulfillment of any of the conditions, herein contained; and all
proceedings taken by the Company and the Selling Shareholders in
connection with the issuance and sale of the Securities as herein
contemplated shall be reasonably satisfactory in form and substance to
counsel for the Underwriters.
(y) Termination of Agreement. If any condition specified in
this Section shall not have been fulfilled when and as required to be
fulfilled, this Agreement and the Brazilian Purchase Agreement, or, in
the case of any condition to the purchase of Option Securities on a
Date of Delivery that is after the Closing Time, the obligations of the
several Underwriters to purchase the relevant Option Securities, may be
terminated by the Representatives by notice to the Company and to the
Selling Shareholders at any time at or prior to the Closing Time or
such Date of Delivery, as the case may be, and such termination shall
be without liability of any party to any other party except as provided
in Section 4 and except that Sections 1, 6, 7 and 8 shall survive any
such termination and remain in full force and effect.
SECTION 6. Indemnification.
(a) Company Indemnification of Underwriters. The Company
agrees to indemnify and hold harmless each Underwriter and each person, if any,
who controls any Underwriter within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act as follows:
(i) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of any untrue statement or
alleged untrue statement of a material fact contained in the
Registration Statement (or any amendment thereto), including the Rule
430A Information, or the ADR Registration Statement or the omission or
alleged omission therefrom of a material fact required to be stated
therein or necessary to make the statements therein not misleading or
arising out of any untrue statement or alleged untrue statement of a
material fact contained in any preliminary prospectus or the Prospectus
(or any amendment or supplement thereto), or the omission or alleged
omission therefrom of a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading;
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate amount
paid in settlement of any litigation, or any investigation or
proceeding by any governmental agency or body, commenced or threatened,
or of any claim whatsoever based upon any such untrue statement or
omission, or any such alleged untrue statement or omission; provided
that (subject to Section 6(e) below) any such settlement is effected
with the written consent of the Company; and
31
(iii) against any and all expense whatsoever, as incurred
(including the reasonable fees and disbursements of counsel chosen by
the Global Coordinators), reasonably incurred in investigating,
preparing or defending against any litigation, or any investigation or
proceeding by any governmental agency or body, commenced or threatened,
or any claim whatsoever based upon any such untrue statement or
omission, or any such alleged untrue statement or omission, to the
extent that any such expense is not paid under (i) or (ii) above;
provided, however, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission (A) made in
reliance upon and in conformity with written information furnished to the
Company by any Underwriter through the Representatives expressly for use in the
Registration Statement (or any amendment thereto), including the 430A
Information or any preliminary prospectus or the Prospectus (or any amendment or
supplement thereto) or (B) contained in or omitted from the Selling Shareholder
Information. This indemnity agreement is subject to the condition that, insofar
as it relates to any untrue statement or omission, or any alleged untrue
statement or omission, made in a preliminary prospectus but eliminated or
remedied in the Prospectus, or any amendment or supplement thereto it shall not
inure to the benefit of any Underwriter from whom the person asserting the claim
purchased the Global Securities (or to the benefit of any person who controls
such Underwriter within the meaning of Section 15 of the 0000 Xxx) if the
Company had previously furnished copies of the Prospectus or such amendment or
supplement to such Underwriter at or prior to the time required by the 1933 Act
and the untrue statement or omission contained in the preliminary prospectus was
corrected in the Prospectus or such amendment or supplement.
(b) Selling Shareholders Indemnification of Underwriters. Each
of the Selling Shareholders agrees to indemnify and hold harmless each
Underwriter and each person, if any, who controls any Underwriter within the
meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act as follows:
(i) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of any untrue statement or
alleged untrue statement of a material fact contained in the Selling
Shareholder Information in the Registration Statement (or any amendment
thereto), or the omission or alleged omission therefrom of a material
fact required to be stated therein or necessary to make the statements
therein not misleading or arising out of any untrue statement or
alleged untrue statement of a material fact contained in any such
sections in the preliminary prospectus or the Prospectus (or any
amendment or supplement thereto), or the omission or alleged omission
therefrom of a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made,
not misleading;
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate amount
paid in settlement of any litigation, or any investigation or
proceeding by any governmental agency or body, commenced or
32
threatened, or of any claim whatsoever based upon any such untrue
statement or omission, or any such alleged untrue statement or
omission; provided that (subject to Section 6(e) below) any such
settlement is effected with the written consent of the Selling
Shareholders; and
(iii) against any and all expense whatsoever, as incurred
(including the fees and disbursements of counsel chosen by the Global
Coordinators), reasonably incurred in investigating, preparing or
defending against any litigation, or any investigation or proceeding by
any governmental agency or body, commenced or threatened, or any claim
whatsoever based upon any such untrue statement or omission, or any
such alleged untrue statement or omission, to the extent that any such
expense is not paid under (i) or (ii) above;
provided, however, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Company by any
Underwriter through the Representatives expressly for use in the Registration
Statement (or any amendment thereto), or any preliminary prospectus or the
Prospectus (or any amendment or supplement thereto); the liability of the
Selling Shareholders under this Section 6 shall be limited to the amount
received by the Selling Shareholders as proceeds from the sale of the ADSs. This
indemnity agreement is subject to the condition that, insofar as it relates to
any untrue statement or omission, or any alleged untrue statement or omission,
made in a preliminary prospectus but eliminated or remedied in the Prospectus,
it shall not inure to the benefit of any Underwriter from whom the person
asserting the claim purchased the Global Securities (or to the benefit of any
person who controls such Underwriter within the meaning of Section 15 of the
0000 Xxx) if the Company had previously furnished copies of the Prospectus to
such Underwriter at or prior to the time required by the 1933 Act, the untrue
statement or omission contained in the preliminary prospectus was corrected in
the Prospectus.
(c) Indemnification of Company, Directors, Officers and
Selling Shareholders. Each Underwriter severally agrees to indemnify and hold
harmless the Company, its directors, its officers who signed the Registration
Statement, the Selling Shareholders and each person, if any, who controls the
Company or any of the Selling Shareholders within the meaning of Section 15 of
the 1933 Act or Section 20 of the 1934 Act against any and all loss, liability,
claim, damage and expense described in the indemnity contained in subsections
(a) and (b) of this Section, as incurred, but only with respect to untrue
statements or omissions, or alleged untrue statements or omissions, made in the
Registration Statement (or any amendment thereto), including the Rule 430A
Information or any preliminary prospectus or the Prospectus (or any amendment or
supplement thereto) in reliance upon and in conformity with written information
furnished to the Company by such Underwriter through the Global Coordinators
expressly for use in the Registration Statement (or any amendment thereto) or
such preliminary prospectus or the Prospectus (or any amendment or supplement
thereto).
33
(d) Actions Against Parties; Notification. Each indemnified
party shall give notice as promptly as reasonably practicable to each
indemnifying party of any action commenced against it in respect of which
indemnity may be sought hereunder, but failure to so notify an indemnifying
party shall not relieve such indemnifying party from any liability hereunder to
the extent it is not materially prejudiced as a result thereof and in any event
shall not relieve it from any liability which it may have otherwise than on
account of this indemnity agreement. In the case of parties indemnified pursuant
to Sections 6(a) and (b) above, counsel to the indemnified parties shall be
selected by the Global Coordinators, and, in the case of parties indemnified
pursuant to Section 6(c) above, counsel to the indemnified parties shall be
selected by the Company and the Selling Shareholders as such parties may agree
between themselves. An indemnifying party may participate at its own expense in
the defense of any such action; provided, however, that counsel to the
indemnifying party shall not (except with the consent of the indemnified party)
also be counsel to the indemnified party. In no event shall the indemnifying
parties be liable for fees and expenses of more than one counsel (in addition to
any local counsel) separate from their own counsel for all indemnified parties
in connection with any one action or separate but similar or related actions in
the same jurisdiction arising out of the same general allegations or
circumstances. No indemnifying party shall, without the prior written consent of
the indemnified parties, settle or compromise or consent to the entry of any
judgment with respect to any litigation, or any investigation or proceeding by
any governmental agency or body, commenced or threatened, or any claim
whatsoever in respect of which indemnification or contribution could be sought
under this Section 6 or Section 7 hereof (whether or not the indemnified parties
are actual or potential parties thereto), unless such settlement, compromise or
consent (i) includes an unconditional release of each indemnified party from all
liability arising out of such litigation, investigation, proceeding or claim 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.
(e) Settlement Without Consent if Failure to Reimburse. No
indemnifying party shall be liable for any settlement of any proceeding effected
without its written consent; provided that if at any time an indemnified party
shall have requested an indemnifying party to reimburse the indemnified party
for fees and expenses of counsel in accordance with this Section 6, such
indemnifying party agrees that it shall be liable for any settlement of the
nature contemplated by Sections 6(a)(ii) and 6(b)(ii) effected without its
written consent if (i) such settlement is entered into more than 45 days after
receipt by such indemnifying party of the aforesaid request, (ii) such
indemnifying party shall have received notice of the terms of such settlement at
least 30 days prior to such settlement being entered into and (iii) such
indemnifying party shall not have reimbursed such indemnified party in
accordance with such request prior to the date of such settlement.
(f) Other Agreements with Respect to Indemnification. The
provisions of this Section shall not affect, or be affected by, any agreement
among the Company and the Selling Shareholders with respect to indemnification.
34
SECTION 7. Contribution. If the indemnification provided for
in Section 6 hereof is for any reason unavailable to or insufficient to hold
harmless an indemnified party in respect of any losses, liabilities, claims,
damages or expenses referred to therein, then each indemnifying party shall
contribute to the aggregate amount of such losses, liabilities, claims, damages
and expenses incurred by such indemnified party, as incurred, (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Company and the Selling Shareholders on the one hand and the Underwriters on the
other hand from the offering of the Global Securities pursuant to this Agreement
or (ii) if the allocation provided by clause (i) is not permitted by applicable
law, in such proportion as is appropriate to reflect not only the relative
benefits referred to in clause (i) above but also the relative fault of the
Company and the Selling Shareholders on the one hand and of the Underwriters on
the other hand in connection with the statements or omissions which resulted in
such losses, liabilities, claims, damages or expenses, as well as any other
relevant equitable considerations.
The relative benefits received by the Company and the Selling
Shareholders on the one hand and the Underwriters on the other hand in
connection with the offering of the Global Securities pursuant to this Agreement
shall be deemed to be in the same respective proportions as the total net
proceeds from the offering of the Global Securities pursuant to this Agreement
(before deducting expenses) received by the Company and the Selling Shareholders
and the total underwriting discount received by the Underwriters, in each case
as set forth on the cover of the Prospectus.
The relative fault of the Company and the Selling Shareholders
on the one hand and the Underwriters on the other hand shall be determined by
reference to, among other things, whether any such untrue or alleged untrue
statement of a material fact or omission or alleged omission to state a material
fact relates to information supplied by the Company or the Selling Shareholders
or by the Underwriters and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The Company, the Selling Shareholders and the Underwriters
agree that it would not be just and equitable if contribution pursuant to this
Section 7 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
which does not take account of the equitable considerations referred to above in
this Section 7. The aggregate amount of losses, liabilities, claims, damages and
expenses incurred by an indemnified party and referred to above in this Section
7 shall be deemed to include any legal or other expenses reasonably incurred by
such indemnified party in investigating, preparing or defending against any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever based upon any such
untrue or alleged untrue statement or omission or alleged omission.
Notwithstanding the provisions of this Section 7, no
Underwriter shall be required to contribute any amount in excess of the amount
by which the total price at which the Global Securities underwritten by it and
distributed to the public were offered to the public exceeds the
35
amount of any damages which such Underwriter has otherwise been required to pay
by reason of any 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 0000 Xxx) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 7, each person, if any, who
controls an Underwriter within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act shall have the same rights to contribution as such
Underwriter; and each director of the Company, each officer of the Company who
signed the Registration Statement, and each person, if any, who controls the
Company or any of the Selling Shareholders within the meaning of Section 15 of
the 1933 Act or Section 20 of the 1934 Act shall have the same rights to
contribution as the Company or the respective Selling Shareholder, as the case
may be. The Underwriters' respective obligations to contribute pursuant to this
Section 7 are several in proportion to the number of Initial Securities set
forth opposite their respective names in Schedule A hereto and not joint.
The provisions of this Section shall not affect, or be
affected by, any agreement between the Company and the Selling Shareholders with
respect to contribution.
SECTION 8. Representations, Warranties and Agreements to
Survive Delivery. All representations, warranties and agreements contained in
this Agreement or in certificates of officers of the Company or the Selling
Shareholders submitted pursuant hereto, shall remain operative and in full force
and effect, regardless of any investigation made by or on behalf of any
Underwriter or controlling person, or by or on behalf of the Company or the
Selling Shareholders, and shall survive delivery of the Global Securities to the
Underwriters.
SECTION 9. Termination of Agreement.
(a) Termination; General. The Representatives may terminate
this Agreement, by notice to the Company and the Selling Shareholders, at any
time at or prior to the Closing Time if (i) there has been, since the time of
execution of this Agreement or since the respective dates as of which
information is given in the Prospectus (exclusive of any supplement thereto),
any material adverse change in the condition, financial or otherwise, or in the
earnings, business affairs or business prospects of the Company and its
Subsidiaries considered as one enterprise, whether or not arising in the
ordinary course of business, (ii) there has occurred any material adverse change
in the financial markets in the United States, Brazil or the international
financial markets, any outbreak of hostilities or escalation thereof or other
calamity or crisis or any change or development involving a prospective change
in national or international political, financial or economic conditions, in
each case the effect of which is such as to make it, in the judgment of the
Representatives, impracticable or inadvisable to market the Global Securities or
to enforce contracts for the sale of the Global Securities, (iii) trading in any
securities of the Company has been suspended or limited by the Sao Paulo Stock
Exchange, trading in the ADSs has been suspended by the Commission or suspended
or limited by the New York Stock Exchange, or trading generally on the American
Stock Exchange or the New York Stock Exchange or in the
36
NASDAQ National Market has been suspended or limited, or minimum or maximum
prices for trading have been fixed, or maximum ranges for prices have been
required, by any of said exchanges or by such system or by order of the
Commission, the National Association of Securities Dealers, Inc. or any other
governmental authority, or a material disruption has occurred in commercial
banking or securities settlement or clearance services in the United States or
with respect to Clearstream or Euroclear systems in Europe, or (iv) if a banking
moratorium has been declared by either U.S. federal, Brazilian or New York
authorities.
(b) Liabilities. If this Agreement is terminated pursuant to
this Section, such termination shall be without liability of any party to any
other party except as provided in Section 4 hereof, and provided further that
Sections 1, 6, 7 and 8 shall survive such termination and remain in full force
and effect.
SECTION 10. Default by One or More of the Underwriters. If one
or more of the Underwriters shall fail at the Closing Time or a Date of Delivery
to purchase the Global Securities which it or they are obligated to purchase
under this Agreement (the "Defaulted Global Securities"), the Representatives
shall have the right, within 24 hours thereafter, to make arrangements for one
or more of the non-defaulting Underwriters, or any other underwriters, to
purchase all, but not less than all, of the Defaulted Global Securities in such
amounts as may be agreed upon and upon the terms herein set forth; if, however,
the Representatives shall not have completed such arrangements within such
24-hour period, then:
(a) if the number of Defaulted Global Securities does not
exceed 10% of the number of Global Securities to be purchased on such
date, each of the non-defaulting Underwriters shall be obligated,
severally and not jointly, to purchase the full amount thereof in the
proportions that their respective underwriting obligations hereunder
bear to the underwriting obligations of all non-defaulting
Underwriters, or
(b) if the number of Defaulted Global Securities exceeds 10%
of the number of Securities to be purchased on such date, this
Agreement or, with respect to any Date of Delivery that occurs after
the Closing Time, the obligation of the Underwriters to purchase and of
the Selling Shareholders to sell the Global Securities to be purchased
and sold on such Date of Delivery shall terminate without liability on
the part of any non-defaulting Underwriter.
No action taken pursuant to this Section shall relieve any
defaulting Underwriter from liability in respect of its default.
In the event of any such default that does not result in a
termination of this Agreement or, in the case of a Date of Delivery that is
after the Closing Time, that does not result in a termination of the obligation
of the Underwriters to purchase and the Selling Shareholders to sell the
relevant Option Securities, as the case may be, the Representatives, the Company
and the Selling Shareholders shall have the right to postpone the Closing Time
or the relevant Date of Delivery, as the case may be, for a period not exceeding
seven days in order to effect any required changes in the Registration Statement
or the Prospectus or in any other
37
documents or arrangements. As used herein, the term "Underwriter" includes any
person substituted for an Underwriter under this Section 10.
SECTION 11. Default by the Selling Shareholders. If any
Selling Shareholder shall fail at the Closing Time or at any Date of Delivery to
sell and deliver the number of Global Securities that the Selling Shareholder so
defaulting is obligated to sell hereunder, then the Underwriters may, at the
option of the Representatives, by notice from the Representatives to the Company
terminate this Agreement without any liability on the fault of any
non-defaulting party except that the provisions of Sections 1, 4, 6, 7, 8, 13,
14 and 15 shall remain in full force and effect. No action taken pursuant to
this Section 11 shall relieve the Selling Shareholder so defaulting from
liability, if any, in respect of such default.
In the event of a default by any of the Selling Shareholders
as referred to in this Section 11, the Representatives and the Company shall
have the right to postpone the Closing Time or such Date of Delivery for a
period not exceeding seven days in order to effect any required change in the
Registration Statement or the Prospectus or in any other documents or
arrangements.
SECTION 12. Notices. All notices and other communications
hereunder shall be in writing and shall be deemed to have been duly given if
mailed or transmitted by any standard form of telecommunication. Notices to the
Underwriters shall be directed to the Representatives at Xxxxx Xxxxx, Xxxxx
Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000-0000, attention of Xxxxxxx Xxxxxx,
Managing Director and 00 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, attention
of --; notices to the Company shall be directed to it at Xxxxxxx Xxxxx
Xxxxxx, Xx. 00, 00000-000 Xxx xx Xxxxxxx, XX, Xxxxxx, attention of Paulo
Xxxxxxxxx xx Xxxxxxx Xxxxx; and notices to the Selling Shareholders shall be
directed to BNDES at Xx. Xxxxxxxxx xx Xxxxx, 000-00 andar, 000-000-000 Xxx xx
Xxxxxxx, XX, Xxxxxx, attention of the Director de Desestatizacao.
SECTION 13. Parties. This Agreement shall inure to the benefit
of and be binding upon each of the Underwriters, the Company and the Selling
Shareholders and their respective successors. Nothing expressed or mentioned in
this Agreement is intended or shall be construed to give any person, firm or
corporation, other than the Underwriters, the Company and the Selling
Shareholders and their respective successors and the controlling persons and
officers and directors referred to in Sections 6 and 7 and their heirs and legal
representatives, any legal or equitable right, remedy or claim under or in
respect of this Agreement or any provision herein contained. This Agreement and
all conditions and provisions hereof are intended to be for the sole and
exclusive benefit of the Underwriters, the Company and the Selling Shareholders
and their respective successors, and said controlling persons and officers and
directors and their heirs and legal representatives, and for the benefit of no
other person, firm or corporation. No purchaser of Global Securities from any
Underwriter shall be deemed to be a successor by reason merely of such purchase.
SECTION 14. Waiver of Immunities.
38
(a) The Company. To the extent that the Company or any of its
properties, assets or revenues may have or may hereafter become entitled to, or
have attributed to the Company, any right of immunity, on the grounds of
sovereignty or otherwise, from any legal action, suit or proceeding, from the
giving of any relief in any such legal action, suit or proceeding, from setoff
or counterclaim, from the jurisdiction of any Brazilian, New York or U.S.
federal court, from service of process, from attachment upon or prior to
judgment, from attachment in aid of execution of judgment, or from execution of
judgment, or other legal process or proceeding for the giving of any relief or
for the enforcement of any judgment, in any such court in which proceedings may
at any time be commenced, with respect to the obligations and liabilities of the
Company, or any other matter under or arising out of or in connection with this
Agreement or the Brazilian Purchase Agreement, the Company hereby irrevocably
and unconditionally waives or will waive such right to the extent permitted by
law, and agrees not to plead or claim, any such immunity and consents to such
relief and enforcement.
(b) .BNDES. To the extent that BNDES, acting solely in its own
capacity, or any of its properties, assets or revenues may have or may hereafter
become entitled to, or have attributed to BNDES, any right of immunity, on the
grounds of sovereignty or otherwise, from any legal action, suit or proceeding,
from the giving of any relief in any such legal action, suit or proceeding, from
setoff or counterclaim, from the jurisdiction of any Brazilian, New York or U.S.
federal court, from service of process, from attachment upon or prior to
judgment, from attachment in aid of execution of judgment, or from execution of
judgment, or other legal process or proceeding for the giving of any relief or
for the enforcement of any judgment, in any such court in which proceedings may
at any time be commenced, with respect to the obligations and liabilities of
BNDES, acting solely in its own capacity, or any other matter under or arising
out of or in connection with this Agreement or the Brazilian Purchase Agreement,
BNDES, acting solely in its own capacity, hereby irrevocably and unconditionally
waives or will waive such right to the extent permitted by law, and agrees not
to plead or claim, any such immunity and consents to such relief and
enforcement.
SECTION 15. Arbitration; Company and BNDESECTION 16. S Consent
to Jurisdiction; Appointment of Agent for Service of Process(a) Brazil, a
Selling Shareholder, is not permitted to and does not hereby submit to the
jurisdiction of any court outside Brazil in connection with this Agreement or
the transactions contemplated herein. If any dispute, controversy or claim
arising out to or relating to this Agreement or the transactions contemplated
hereby, including the existence, performance, interpretation, construction,
breach, termination or invalidity thereof (a "Dispute") (other than a Dispute
which is made the subject of a suit, action or proceeding brought against Brazil
in a competent court in Brazil) shall arise between the Underwriters, on the one
hand, and Brazil on the other, the Underwriters or Brazil, as the case may be
(the "Referring Party") shall by written notice (the "Referral Notice") to
Brazil or the Underwriters, as the case may be (the "Other Party"), refer such
Dispute to arbitration and the Other Party shall upon receipt of the Referral
Notice be obligated to refer such Dispute to arbitration proceedings as set
forth herein. The Referral Notice shall describe the nature of such dispute,
difference or question and request the formation of an arbitral tribunal. Any
Dispute shall be finally settled by arbitration in accordance with the
Arbitration Rules of the United Nations Commission on
39
International Trade Law (excluding Article 26 hereof) in effect on the date of
this Agreement (the "UNCITRAL Arbitration Rules"). The number of arbitrators
shall be three, to be appointed in accordance with Section II of the UNCITRAL
Arbitration Rules, which, among other things, provides that (i) the Referring
Party and the Other Party shall each appoint one arbitrator (such appointment to
be made within 30 calendar days of receipt of the Referral Notice), (ii) the two
arbitrators thus appointed shall choose the third arbitrator who will act as the
presiding arbitrator of the tribunal and (iii) if within 30 calendar days after
the appointment of the second arbitrator the two arbitrators have not agreed on
the choice of a presiding arbitrator, the presiding arbitrator shall be
appointed under Article 6 of the UNCITRAL Arbitration Rules. The appointing
authority shall be the Chairman of the International Court of Arbitration of the
International Chamber of Commerce. The third arbitrator may be (but need not be)
of the same nationality as any of the parties to the arbitration. Such
arbitration proceedings shall take place in New York, New York and the language
of such proceedings shall be English. The arbitrators shall appoint a secretary
with offices and facilities in New York, New York to provide administrative
support for the proceedings. Any arbitral tribunal established hereunder shall
state its reasons for its decisions in writing and shall make such decisions
entirely on the basis of the substantive law governing this Agreement and not on
the basis of the principle of ex aequo et xxxx or otherwise. The decision of any
such arbitral tribunal shall be final to the fullest extent permitted by law,
and Brazil hereby agrees that a court judgment may be entered theron by the
United States District Court of the Southern District of New York. Brazil agrees
that in any such arbitration and in any legal proceedings for the recognition of
an award rendered in an arbitration conducted pursuant to this Section 15,
including any proceedings required for the purposes of converting an arbitral
award into a judgment, it will not raise any defense which it could not raise
but for the fact that it is a sovereign state. Brazil hereby irrevocably
consents to the jurisdiction of the United States District Court of the Southern
District of New York (the "New York Court") for the limited purpose of judicial
recognition of an arbitral award rendered against Brazil in New York, New York.
(b) For the sole purpose of receiving service of process or
other legal summons in connection with obtaining any judicial acceptance of any
arbitral award in the New York Court, Brazil hereby represents and warrants that
any such process or summons may be served upon it, pursuant to Article 35,
Section I of Supplementary Law No. 73 of February 10, 1993, by delivery to the
Attorney General of Brazil (Advogado Geral da Uniao), Xxxxxxx do Planalto,
Xxxxxxxxx xxx Xxxxxxxxxxx, Xxxxx 0, Xxxxxxxx-XX, Xxxxxx, as its authorized agent
(the "Authorized Agent") upon whom any such process or summons may be served, of
letter rogatory or by any other means permissible under the laws of the State of
New York and Brazil. Brazil hereby irrevocably waives any immunity to service of
process or other legal summons effected in accordance with this subsection in
respect of any action to obtain such judicial recognition.
(c) Brazil hereby represents and warrants that it has no right
to immunity, on the grounds of sovereignty or otherwise, from the service of
process or jurisdiction or any judicial proceedings of any competent court
located in Brazil or from execution of any judgment in Brazil (except for the
limitation on alienation of public property referred to in Article 67 of the
Civil Code of Brazil) or from the execution or enforcement therein of any
arbitration decision in
40
respect of any suit, action, proceeding or any other matter arising out of or
relating to its obligations under this Agreement or the transactions
contemplated hereby, and to the extent that Brazil is or becomes entitled to any
such immunity with respect to the service of process or jurisdiction or any
judicial proceedings of any competent court located in Brazil, it does hereby
and will irrevocably and unconditionally agree not to plead or claim any such
immunity with respect to its obligations or any other matter under or arising
out of or in connection with this Agreement or the transactions contemplated
hereby.
(d) Any action arising out of or based on this Agreement may
be instituted by the Underwriters in any competent court in Brazil. Brazil
hereby agrees that the Underwriters shall have the right, exercisable at their
sole discretion, to institute legal proceedings against Brazil through the
proceedings contemplated in Articles 730 et seq. of the Brazilian Code of Civil
Procedure. Brazil hereby waives irrevocably any immunity from jurisdiction or
execution to which it might otherwise be entitled (except for the limitation on
alienation of public property under Article 67 of the Civil Code of Brazil) in
any action arising out of or based on this Agreement which may be instituted by
the Underwriters in any competent court in Brazil.
(e) No arbitration proceedings hereunder shall be binding upon
or in any way affect the right or interest of any person other than the claimant
or respondent with respect to such arbitration.
(f) To the extent a dispute arises between the Company on the
one hand and Brazil, the Company agrees to be bound by the provisions of
Subsections (a) through (e) of this Section requiring, among other things, the
use of arbitration as the sole means of resolving actions brought or adjudicated
by any court or similar judicial authority outside Brazil.
(g) Consent to Jurisdiction. The Company and BNDES, acting
solely in its own capacity, by their respective execution and delivery of this
Agreement, agree that service of process may be made upon CT Corporation System,
0000 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (or its successors as agent for service
of process), in the County, City and State of New York, United States of America
in any suit or proceeding against the Company or BNDES, in its own capacity,
instituted by any Underwriter or by any person controlling any Underwriter based
on or arising under this Agreement in any federal or state court in the State of
New York, County of New York, and hereby irrevocably consent and submit to the
nonexclusive jurisdiction of any such court in personam generally and
unconditionally in respect of any such suit or proceeding.
(g) Appointment of Agent for Service of Process. The Company
and BNDES, acting solely in its own capacity, further, by their respective
execution and delivery of this Agreement, irrevocably designate, appoint and
empower CT Corporation System, 0000 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000 as their
designee, appointee and authorized agent to receive for and on their behalf
service of any and all legal process, summons, notices and documents that may be
served in any action, suit or proceeding brought against the Company or BNDES,
in its own capacity, as the case may be, with respect to its obligations,
liabilities or any other matter arising out of or in connection with this
Agreement and that may be made on such designee, appointee and authorized agent
in accordance with legal procedures prescribed for
41
such courts, and it being understood that the designation and appointment of CT
Corporation System as such authorized agent shall become effective immediately
without any further action on the part of the Company or BNDES, as the case may
be. The Company and BNDES, acting solely in its own capacity, represent to each
Underwriter that they have notified CT Corporation System of such designation
and appointment and that CT Corporation System has accepted the same. The
Company and BNDES, acting solely in its own capacity, further agree that, to the
extent permitted by law, proper service of process upon CT Corporation System
(or its successors as agent for service of process) and written notice of said
service to the Company or BNDES, as the case may be, pursuant to Section 12,
shall be deemed in every respect effective service of process upon the Company
or BNDES, as the case may be, in any such suit or proceeding. If for any reason
such designee, appointee and agent hereunder shall cease to be available to act
as such, the Company and BNDES agree to designate a new designee, appointee and
agent in The City of New York, New York on the terms and for the purposes of
this Section 15 reasonably satisfactory to the Representatives. The Company and
BNDES further hereby irrevocably consent and agree to the service of any and all
legal process, summons, notices and documents in any such action, suit or
proceeding against the Company or BNDES, as the case may be, by serving a copy
thereof upon the relevant agent for service of process referred to in this
Section 15 (whether or not the appointment of such agent shall for any reason
prove to be ineffective or such agent shall accept or acknowledge such service)
and by mailing copies thereof by registered or certified air mail, postage
prepaid, to the Company or BNDES, as the case may be, at the respective address
specified in or designated pursuant to this Agreement. The Company and BNDES
agree that the failure of any such designee, appointee and agent to give any
notice of such service to it shall not impair or affect in any way the validity
of such service or any judgment rendered in any action or proceeding based
thereon. Nothing herein shall in any way be deemed to limit the ability of the
Underwriters and the other persons referred to in Sections 6 and 7 to serve any
such legal process, summons, notices and documents in any other manner permitted
by applicable law or to obtain jurisdiction over the Company and each of the
Selling Shareholders or bring actions, suits or proceedings against the Company
or any of the Selling Shareholders, as the case may be, in such other
jurisdictions, and in such manner, as may be permitted by applicable law. The
Company and BNDES, acting solely in its own capacity, hereby irrevocably and
unconditionally waive, to the fullest extent permitted by law, any objection
that they may now or hereafter have to the laying of venue of any of the
aforesaid actions, suits or proceedings arising out of or in connection with
this Agreement brought in the federal courts located in The City of New York,
New York or the courts of the State of New York located in The City of New York,
New York and hereby further irrevocably and unconditionally waive and agree not
to plead or claim in any such court that any such action, suit or proceeding
brought in any such court has been brought in an inconvenient forum.
(h) Survival of Agreement. The provisions of this Section 15
shall survive any termination of this Agreement, in whole or in part.
SECTION 17. Judgment Currency. The Company and each of the
Selling Shareholders agree to indemnify each Underwriter and each person, if
any, who controls any Underwriter within the meaning of Section 15 of the 1933
Act or Section 20 of the 1934 Act, and
42
each Underwriter severally agrees to indemnify the Company and each of the
Selling Shareholders, their respective directors, each of the officers of the
Company who signed the Registration Statement, and each person, if any, who
controls the Company or any of the Selling Shareholders within the meaning of
Section 15 of the 1933 Act or Section 20 of the 1934 Act, against any loss
incurred, as incurred, as a result of any judgment being given in connection
with this Agreement, the Prospectus, the Registration Statement or the ADR
Registration Statement for which indemnification is provided by such person
pursuant to Section 6 of this Agreement and any such judgment or order being
paid in a currency (the "Judgment Currency") other than U.S. dollars as a result
of any variation as between (i) the spot rate of exchange in New York at which
the Judgment Currency would have been convertible into U.S. dollars as of the
date such judgment or order is entered, and (ii) the spot rate of exchange at
which the indemnified party is first able to purchase U.S. dollars with the
amount of the Judgment Currency actually received by the indemnified party. If,
alternatively, the indemnified party receives a profit as a result of such
currency conversion, it will return any such profits to the indemnifying party
(after taking into account any taxes or other costs arising in connection with
such conversion and repayment). The foregoing indemnity shall constitute a
separate and independent, several and not joint, obligation of the Company, the
Underwriters and the Selling Shareholders and shall continue in full force and
effect notwithstanding any such judgment or order as aforesaid. The term "spot
rate of exchange" shall include any premiums and costs of exchange payable in
connection with the purchase of, or conversion into, the relevant currency.
SECTION 18. GOVERNING LAW AND TIME. THIS AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
SPECIFIED TIMES OF DAY REFER TO NEW YORK CITY TIME.
SECTION 19. Effect of Headings. The Article and Section
headings herein and the Table of Contents are for convenience only and shall not
affect the construction hereof.
43
If the foregoing is in accordance with your understanding of
our agreement, please sign and return to the Company and [the Attorney-in-Fact
for] Brazil, and BNDES a counterpart hereof, whereupon this instrument, along
with all counterparts, will become a binding agreement among the Underwriters,
the Company and the Selling Shareholders in accordance with its terms.
Very truly yours,
COMPANHIA VALE DO RIO DOCE
By
---------------------------------------
Title:
By
---------------------------------------
Title:
BANCO NACIONAL DE
DESENVOLVIMENTO ECONOMICO E
SOCIAL
By
---------------------------------------
[As gestor, acting on behalf of the
Federative Republic of Brazil]
BANCO NACIONAL DE
DESENVOLVIMENTO ECONOMICO E
SOCIAL
By
---------------------------------------
Title:
CONFIRMED AND ACCEPTED,
as of the date first above written:
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX
INCORPORATED
ABN AMRO ROTHSCHILD LLC
By: XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX
INCORPORATED
By
--------------------------------------
Authorized Signatory
For themselves and as Representatives of the other Underwriters named in
Schedule A hereto.
Sch A - 1
SCHEDULE A
Number of
Initial
Name of Underwriter Securities
------------------- ----------
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated.............................................................
ABN AMRO Rothschild LLC.................................................................
Credit Suisse First Boston Corporation..................................................
Xxxxxxx, Xxxxx & Co.....................................................................
X.X. Xxxxxx Securities Inc..............................................................
Xxxxxx Xxxxxxx & Co. Incorporated.......................................................
----------
Total...................................................................................
==========
Sch B - 1
SCHEDULE B
Number of Initial Maximum Number of Option
Securities to Be Sold Securities to Be Sold
--------------------- ---------------------
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated......................
ABN AMRO Rothschild LLC...........................
Credit Suisse First Boston
Corporation.......................
Xxxxxxx, Xxxxx & Co...............................
X.X. Xxxxxx Securities Inc........................
Xxxxxx Xxxxxxx & Co. Incorporated.................
Total.............................................
Sch C - 1
SCHEDULE C
[2]
[1] ADSs
(No Par Value)
1. The initial public offering price per ADS, determined as
provided in said Section 2, shall be $--.
2. The purchase price per share for the Global Securities to
be paid by the several Underwriters shall be $--, being an amount equal to
the initial public offering price set forth above less $-- per ADS; provided
that the purchase price per ADS for any Option Securities purchased upon the
exercise of the over-allotment option described in Section 2(b) shall be reduced
by an amount per ADS equal to any dividends or distributions declared by the
Company and payable on the Initial Securities but not payable on the Option
Securities.
Sch D -1
SCHEDULE D
List of Subsidiaries
COMPANY COUNSEL TO CONFIRM AND PROVIDE LEGAL NAMES
Sch E - 1
SCHEDULE E
List of Persons and Entities subject to Lock-up
A -
Exhibit A
FORM OF OPINION OF COMPANY'S BRAZILIAN COUNSEL
TO BE DELIVERED PURSUANT TO
SECTION 5(b)
(i) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of Brazil.
(ii) The Company has corporate power and authority to own,
lease and operate its properties and to conduct its business as described in the
Prospectus and to enter into and perform its obligations under the Purchase
Agreement, the Brazilian Purchase Agreement and the Deposit Agreement.
(iii) The Company is duly qualified as a foreign corporation
to transact business and is in good standing in each jurisdiction in which such
qualification is required, whether by reason of the ownership or leasing of
property or the conduct of business, except where the failure so to qualify or
to be in good standing would not result in a Material Adverse Effect.
(iv) The authorized, issued and outstanding capital stock of
the Company is as set forth in the Prospectus under the caption "Capitalization"
(except for subsequent issuances, if any, pursuant to reservations, agreements
or employee benefit plans referred to in the Prospectus or pursuant to the
exercise of convertible securities or options referred to in the Prospectus);
the shares of issued and outstanding capital stock, including the Securities to
be purchased by the Underwriters and the Brazilian Managers from each of the
Selling Shareholders, have been duly authorized and validly issued and are fully
paid and non-assessable, and no holder thereof is or will be subject to personal
liability solely by reason of being such a holder; and none of the outstanding
shares of capital stock of the Company was issued in violation of the preemptive
or other similar rights of any securityholder or employee of the Company; and
the issued and outstanding shares of capital stock of the Company conforms in
all material respects to the descriptions thereof in the Prospectus under the
captions "Description of Capital Stock" and "Principal and Selling
Shareholders."
(v) The Common Shares and the ADSs conform in all material
respects as to legal matters to the descriptions thereof in the Prospectus.
(vi) Each of the Selling Shareholders is the record owner of
the Common Shares to be purchased by the Underwriters and the Brazilian Managers
from the respective Selling Shareholder pursuant to the Purchase Agreement and
the Brazilian Purchase Agreement, respectively; the Common Shares may be freely
deposited with the Depositary against issuance
A-2
of ADRs evidencing ADSs; the ADSs and the underlying Common Shares are freely
transferable by each of the Selling Shareholders to the Underwriters and the
Brazilian Managers in the manner contemplated by the Purchase Agreement and the
Brazilian Purchase Agreement; ownership title to such Common Shares, free and
clear of all liens, encumbrances or claims will be transferred to the Depositary
on behalf of the Underwriters at the Closing Time and on any Date of Delivery;
there are no restrictions on subsequent transfers of such Common Shares or the
ADSs except as described in the Prospectus under "Description of American
Depositary Shares;" the Common Shares, the ADRs and the ADSs conform to all
statements relating thereto contained in the Prospectus and such descriptions
conform to the rights set forth in the instruments defining the same; no holder
of the Securities will be subject to personal liability by reason of being such
a holder; and the sale of the Securities is not subject to preemptive or other
similar rights of any securityholder of the Company.
(vii) Each of the Company's subsidiaries has been duly
incorporated and is validly existing as a corporation in good standing under the
laws of the jurisdiction of its incorporation, has corporate power and authority
to own, lease and operate its properties and to conduct its business and is duly
qualified as a foreign corporation to transact business and is in good standing
in each jurisdiction in which such qualification is required, whether by reason
of the ownership or leasing of property or the conduct of business, except where
the failure so to qualify or to be in good standing would not result in a
Material Adverse Effect; except as otherwise disclosed in the Registration
Statement, all of the issued and outstanding capital stock of each such
subsidiary has been duly authorized and validly issued, is fully paid and
non-assessable and, to the best of our knowledge and information, is owned by
the Company, directly or through subsidiaries, free and clear of any security
interest, mortgage, pledge, lien, encumbrance, claim or equity; and none of the
outstanding shares of capital stock of any such subsidiary was issued in
violation of the preemptive or similar rights of any securityholder of such
subsidiary.
(viii) Each of the Purchase Agreement, the Brazilian Purchase
Agreement and the Deposit Agreement have been duly authorized, executed and
delivered by the Company, are in proper legal form under the laws of Brazil for
the enforcement thereof against the Company and, assuming due authorization,
execution and delivery by the Depositary, the Deposit Agreement constitutes a
valid and legally binding obligation of the Company, enforceable in accordance
with its terms, subject as to enforcement to bankruptcy, insolvency,
reorganization and other laws of general applicability relating to or affecting
creditors' rights generally and to general equity principles; and it is not
necessary to ensure the legality, validity, enforceability or admissibility in
evidence of any of the aforesaid agreements in Brazil or any political
subdivision thereof that any of them be filed or recorded or enrolled with any
court or authority in Brazil or any political subdivision thereof or that any
stamp, registration or similar tax be paid in Brazil or any political
subdivision thereof.
(ix) The indemnification and contribution provisions set forth
in Sections 6 and 7 of the Purchase Agreement do not contravene Brazilian public
policy or laws.
A-3
(x) Except as set forth in the Deposit Agreement or the
Prospectus, there are no limitations under Brazilian law on the rights of
holders of Common Shares, ADSs or ADRs evidencing ADSs to hold or vote or
transfer their respective securities and no approvals are currently required in
Brazil (including any foreign exchange or foreign currency approvals) in order
for the Company to pay dividends declared by the Company to the holders of
Common Shares, including the Depositary, or for the conversion by the Depositary
of any dividends paid in Brazilian reais to U.S. dollars and the free transfer
thereof out of Brazil.
(xi) The form of certificate used to evidence the Common
Shares complies in all material respects with all applicable statutory
requirements, with any applicable requirements of the charter and by-laws of the
Company and the requirements of the Sao Paulo Stock Exchange and the applicable
laws of Brazil.
(xii) To the best of our knowledge, there is not pending or
threatened any action, suit, proceeding, inquiry or investigation, to which the
Company or any of its Subsidiaries is a party, or to which the property of the
Company or any of its Subsidiaries is subject, before or brought by any court or
governmental agency or body, domestic or foreign, which might reasonably be
expected to result in a Material Adverse Effect, or which might reasonably be
expected to materially and adversely affect the properties or assets thereof or
the consummation of the transactions contemplated in the Purchase Agreement or
the Brazilian Purchase Agreement or the performance by the Company of its
obligations thereunder.
(xiii) The information in the Prospectus under "Risk Factors
-- Risks Relating to Brazil, -- Risks Relating to the CVRD Group, -- Risks
Relating to the American Depositary Shares," "Market Information," "Exchange
Rates," "Dividend Policy," "Business," "Management," "Major and Selling
Shareholders" "Related Party Transactions," "Description of Capital Stock,"
"Description of American Depositary Shares," "Taxation -- Brazilian Tax
Considerations," and "Enforcement of Civil Liabilities" and in the Registration
Statement under Item 15, to the extent that it constitutes matters of law or
summaries of documents or legal matters of Brazil or legal conclusions in
respect of Brazilian law, or summaries of legal proceedings, the terms and
provisions of the Common Stock or the Company's charter and by-laws, has been
reviewed by us and is correct in all material respects; and the opinion of such
firm set forth under "Taxation -- Brazilian Tax Considerations" is confirmed.
(xiv) To the best of our knowledge, there are no Brazilian
statutes or regulations that are required to be described in the Prospectus that
are not described as required.
(xv) The Company and its obligations under the Purchase
Agreement, the Brazilian Purchase Agreement and the Deposit Agreement are
subject to civil and commercial law and to suit in Brazil and neither the
Company nor its properties, assets or revenues has any right of immunity, on any
grounds, from any legal action, suit or proceeding, from the giving of any
relief in any such legal action, suit or proceeding, from setoff or
counterclaim, from the jurisdiction of any court, from service of process,
attachment upon or prior to judgment, or attachment in aid of execution of
judgment, or from execution of a judgment, or other legal process or proceeding
for the giving of any relief or for the enforcement of judgment, in Brazil,
A-4
with respect to their respective obligations, liabilities or any other matter
under or arising out of or in connection with the Purchase Agreement, the
Brazilian Purchase Agreement or the Deposit Agreement; and, to the extent that
the Company and its properties, assets or revenues may have or may hereafter
become entitled to any such right of immunity in Brazil in which proceedings may
at any time be commenced, the Company has effectively waived or agreed to waive
such right to the extent permitted by law and has consented to such relief and
enforcement as provided in Section 14 of the Purchase Agreement.
(xvi) The choice of the laws of the State of New York as the
governing law of the Purchase Agreement and the Deposit Agreement is a valid
choice of law under the laws of Brazil and courts of Brazil should honor this
choice of law. The Company has the power to submit, and pursuant to the Purchase
Agreement has legally, validly, effectively and irrevocably submitted, to the
jurisdiction of any federal or state court in the State of New York, County of
New York, has the power to waive and pursuant to the Purchase Agreement has
legally, validly, effectively and irrevocably waived any objection to the venue
of a proceeding in any federal or state court in the State of New York, County
of New York and has the power to designate, appoint and empower and pursuant to
the Purchase Agreement has legally, validly, effectively and irrevocably
designated, appointed and empowered an agent for service of process in any suit
or proceeding based on or arising under the Purchase Agreement, the Brazilian
Purchase Agreement or the Deposit Agreement in any federal or state court in the
State of New York, County of New York as provided in Section 15 of the Purchase
Agreement.
(xvii) No transaction tax, stamp duty or similar tax or duty
or capital gains, income, withholding or other taxes are payable by or on behalf
of the Underwriters or the Brazilian Managers in Brazil in connection with the
sale and delivery of the Securities as contemplated by the Purchase Agreement,
the Brazilian Purchase Agreement and the Deposit Agreement or in connection with
execution, delivery or enforcement of the Purchase Agreement, the Brazilian
Purchase Agreement and the Deposit Agreement or any document required to be
delivered thereunder.
(xviii) Neither the Depositary nor any holder of ADRs is
subject to any taxes, duties or withholding imposed by Brazil or any political
subdivision or taxing authority thereof solely by reason of entering into the
Depositary Agreement or receiving payments thereunder or under the Common Shares
or ADSs.
(xix) Any final judgment for a fixed or readily calculable sum
of money rendered by any court of the State of New York or of the United States
located in the State of New York having jurisdiction under its own domestic laws
in respect of any suit, action or proceeding against the Company based upon the
Purchase Agreement would be declared enforceable against the Company by the
courts of Brazil without reexamination, review of the merits of the cause of
action in respect of which the original judgment was given or relitigation of
the matters adjudicated upon or payment of any stamp, registration or similar
tax or duty; provided that (A) the judgment is consistent with public policy in
Brazil and any relevant political subdivision, (B) the judgment was not given or
obtained by fraud or in a manner
A-5
contrary to natural justice, (C) the judgment was not based on a clear mistake
of law or fact, (D) the judgment was not directly or indirectly for the payment
of taxes or other charges of a like nature or of a fine or other penalty, and
(E) the judgment is for a fixed sum. We are not aware of any reason why the
enforcement in Brazil of such a judgment in respect of the Purchase Agreement
would be contrary to public policy in Brazil or any political subdivision
thereof.
(xx) It is not necessary in order to enable any Underwriter to
exercise or enforce its rights under the Purchase Agreement in Brazil or by
reason of the entry into and/or the performance of the Purchase Agreement that
all or any of the Underwriters should be licensed, qualified, authorized or
entitled to do business in Brazil.
(xxi) All descriptions in the Prospectus of contracts and
other documents to which the Company or any of its Subsidiaries is a party are
accurate in all material respects; to the best of our knowledge, there are no
franchises, contracts, indentures, mortgages, loan agreements, notes, leases or
other instruments required to be described or referred to in the Registration
Statement or to be filed as exhibits thereto other than those described or
referred to therein or filed as exhibits thereto, and the descriptions thereof
or references thereto are correct in all material respects.
(xxii) To the best of our knowledge, neither the Company nor
any of its Subsidiaries is in violation of its charter or by-laws and no default
by the Company or any of its Subsidiaries exists in the due performance or
observance of any material obligation, agreement, covenant or condition
contained in any contract, indenture, mortgage, loan agreement, note, lease or
other agreement or instrument that is described or referred to in the
Registration Statement or the Prospectus or filed as an exhibit to the
Registration Statement.
(xxiii) Except for approvals from the Central Bank and from
the CVM relating to the Purchase Agreement and the Deposit Agreement, all of
which have been duly obtained, no filing with, or authorization, approval,
consent, license, order, registration, qualification or decree of any Brazilian
government, governmental instrumentality or court is required to be obtained by
the Company for the due authorization and execution of the Purchase Agreement
and the Deposit Agreement or for the valid authorization, sale and delivery of
the ADSs as contemplated by any of the Purchase Agreement, the Deposit Agreement
or the Prospectus.
(xxiv) The performance by the Underwriters or the Brazilian
Managers in Brazil of any of their rights, duties, obligations and
responsibilities under the Purchase Agreement and the Brazilian Purchase
Agreement will not violate any law applicable in Brazil.
(xxv) The registration of the Common Shares underlying the
ADSs in the name of the Depositary does not violate any law applicable in Brazil
or charter or the by-laws of the Company.
(xxvi) The execution, delivery and performance of the Purchase
Agreement, the Brazilian Purchase Agreement and the Deposit Agreement and the
consummation of the transactions contemplated in the Purchase Agreement, the
Brazilian Purchase Agreement, the
A-6
Deposit Agreement and in the Registration Statement and compliance by the
Company with its obligations under the Purchase Agreement, the Brazilian
Purchase Agreement and the Deposit Agreement will not, whether with or without
the giving of notice or passage of time or both, conflict with or constitute a
breach of, or default or Repayment Event (as defined in Section 1(a)(xiv) of the
Purchase Agreement) under or result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the Company or any of its
Subsidiaries pursuant to any contract, indenture, mortgage, deed of trust, loan
or credit agreement, note, lease or any other agreement or instrument, known to
me, to which the Company or any of its Subsidiaries is a party or by which it or
any of them may be bound, or to which any of the property or assets of the
Company or any of its Subsidiaries is subject (except for such conflicts,
breaches or defaults or liens, charges or encumbrances that would not have a
Material Adverse Effect), nor will such action result in any violation of the
provisions of the charter or by-laws or other organizational document, as the
case may be, of the Company or any of its Subsidiaries, or any applicable
treaty, law, statute, rule, regulation, judgment, order, writ or decree, known
to me, of any government, government instrumentality or court, domestic or
foreign, having jurisdiction over the Company or any of its Subsidiaries or any
of their respective properties, assets or operations.
(xxvii) There are no persons with registration or other
similar rights to have any securities registered pursuant to the Registration
Statement or otherwise registered by the Company under the 1933 Act.
(i) The Purchase Agreement, the Brazilian Purchase Agreement
and the Deposit Agreement, upon the due execution and delivery thereof, will be,
in proper legal form under the laws of Brazil for the enforcement thereof in
Brazil against the Company; and it is not necessary to ensure the legality,
validity, enforceability or admissibility in evidence of any of the aforesaid
agreements in Brazil or any political subdivision thereof that any of them be
filed or recorded or enrolled with any court or authority in Brazil or any
political subdivision thereof or that any stamp, registration or similar tax be
paid in Brazil or any political subdivision thereof; except that, in order to
enforce any of the agreements referred to in this paragraph against the Company
in Brazil, such agreements (except for the Brazilian Purchase Agreement, if
signed in Brazil) must first be (i) notarized by a local notary and the
signature of such notary authenticated by the Brazilian consulate having
jurisdiction over the place of execution; (ii) translated into Portuguese by a
sworn translator (and all Brazilian court proceedings would be based on such
translation); and (iii) registered with the Cartorio de Titulos e Documentos in
the place of the head offices of the Company, and the party seeking enforcement
will be required to pay applicable court costs.
(xxviii) Except as otherwise disclosed in the Prospectus, the
Company has such certificates, authorizations, licenses, concessions, approvals,
orders or permits issued by the appropriate regulatory agencies or bodies of
Brazil necessary to own or lease, as the case may be, and to operate its
properties and to conduct the business now conducted by the Company in Brazil,
and the Company is in compliance with the terms and conditions of the foregoing,
except to the extent that the failure to have any such certificates,
authorizations, licenses, concessions,
A-7
approvals, orders or permits would not have a material adverse effect on the
condition (financial or otherwise), earnings, business affairs or business
prospects of the Company, and all such certificates, authorizations, licenses
and permits are in full force and effect, except to the extent that the failure
to have such certificates, authorizations, licenses and permits in full force
and effect would not have a material adverse effect on the condition (financial
or otherwise), earnings, business affairs or business prospects of the Company.
(xxix) Subject to proper notarization and legalization with
the Brazilian Consulate in New York, New York, and sworn translation thereof
into Portuguese, the Purchase Agreement and the Deposit Agreement are in proper
legal form under the laws of Brazil for the enforcement thereof against the
Company in the courts of Brazil.
Nothing has come to our attention that would lead us to
believe that the Registration Statement or any amendment thereto, including the
Rule 430A Information and Rule 434 Information (if applicable), (except for
financial statements and schedules and other financial data included therein or
omitted therefrom, as to which we make no statement) or the ADR Registration
Statement, at the time the Registration Statement or the ADR Registration
Statement or any such amendment 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 or any amendment or supplement thereto (except for financial
statements and schedules and other financial data included or omitted therefrom,
as to which such counsel need make no statement), at the time the Prospectus was
issued, at the time any such amended or supplemented prospectus was issued or at
the Closing Time, included or includes an untrue statement of a material fact or
omitted or omits to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading.
In rendering such opinion, such counsel may rely (A) as to
matters involving the application of the laws of New York, upon the opinion of
Xxxxx Xxxx & Xxxxxxxx, special United States counsel to the Company, and (B) as
to matters of fact (but not as to legal conclusions), to the extent they deem
proper, on certificates of responsible officers of the Company and public
officials. Such opinion shall not state that it is to be governed or qualified
by, or that it is otherwise subject to, any treatise, written policy or other
document relating to legal opinions, including, without limitation, the Legal
Opinion Accord of the ABA Section of Business Law (1991).
B-1
Exhibit B
FORM OF OPINION OF COMPANY'S SPECIAL U.S. COUNSEL
TO BE DELIVERED PURSUANT TO
SECTION 5(c)
(i) The Registration Statement, including any Rule 462(b)
Registration Statement, and the ADR Registration Statement have been declared
effective under the 1933 Act; any required filing of the Prospectus pursuant to
Rule 424(b) has been made in the manner and within the time period required by
Rule 424(b); and, to the best of our knowledge and information, no stop order
suspending the effectiveness of either the Registration Statement, any Rule
462(b) Registration Statement or the ADR Registration Statement has been issued
under the 1933 Act or proceedings therefor initiated or threatened by the
Commission.
(ii) The Registration Statement, including any Rule 462(b)
Registration Statement, the Rule 430A Information and the Rule 434 Information,
as applicable, the Prospectus, excluding the documents incorporated by reference
therein, and the ADR Registration Statement, and each amendment or supplement to
the Registration Statement, the ADR Registration Statement and the Prospectus,
excluding the documents incorporated by reference therein or omitted therefrom
(other than the financial statements and supporting schedules included therein
or omitted therefrom, as to which no opinion need be rendered), as of their
respective effective or issue dates, complied as to form in all material
respects with the requirements of the 1933 Act and the 1933 Act Regulations.
(iii) If Rule 434 has been relied upon, the Prospectus was not
"materially different," as such term is used in Rule 434, from the prospectus
included in the Registration Statement at the time it became effective.
(iv) No filing with, or authorization, approval, consent,
license, order, registration, qualification or decree of, any court or
governmental authority or agency, domestic or foreign (other than under the 1933
Act and the 1933 Act Regulations, which have been obtained, or as may be
required under the securities or blue sky laws of the various states, as to
which we need express no opinion) is necessary or required in connection with
the due authorization, execution and delivery of the Purchase Agreement, the
Brazilian Purchase Agreement and the Deposit Agreement or for the offering, sale
or delivery of the Securities.
(v) Under the laws of the State of New York relating to
submission to jurisdiction and pursuant to the Purchase Agreement, the Company
has legally, validly, effectively and irrevocably submitted to the personal
jurisdiction of any federal or state court in the State of New York, County of
New York in any suit or proceeding based on or arising under the Purchase
Agreement or the Deposit Agreement and has validly and effectively waived any
objection to the venue of a proceeding in any such court as provided in Section
15 of the
B-2
Purchase Agreement; and the Company has the power to designate, appoint and
empower and pursuant to the Purchase Agreement has validly, effectively and
irrevocably designated, appointed and empowered an agent for service of process
in any suit or proceeding based on or arising under the Purchase Agreement, the
Brazilian Purchase Agreement or the Deposit Agreement in any federal or state
court in the State of New York, County of New York as provided in Section 15 of
the Purchase Agreement.
(vi) The execution, delivery and performance by the Company of
the Purchase Agreement and the consummation on the part of the Company of the
transactions contemplated therein will not result in a violation of any U.S.
federal or New York state law or administrative regulation or, to the best of
our knowledge, administrative or court order or decree.
(vii) Assuming the Purchase Agreement and the Brazilian
Purchase Agreement have each been duly authorized by the Company in accordance
with the laws of Brazil, each of such Agreements has been duly authorized,
executed and delivered by the Company.
(viii) Assuming the Deposit Agreement has been duly authorized
by the Company in accordance with the laws of Brazil and assuming due
authorization, execution and delivery by the Depositary, the Deposit Agreement
constitutes a valid and legally binding obligation of the Company, enforceable
in accordance with its terms, subject as to enforcement to bankruptcy,
insolvency, reorganization and other laws of general applicability relating to
or affecting creditors' rights generally and to general equity principles and,
assuming that the underlying shares have been duly and validly authorized and
issued and are fully paid and nonassessable, upon the issuance by the Depositary
of the ADRs evidencing ADSs against the deposit of the underlying shares in
accordance with the Deposit Agreement and due execution by one of the
Depositary's authorized officers, such ADRs will entitle the persons in whose
names such ADRs are registered to the rights specified therein and in the
Deposit Agreement.
(ix) To the best of our knowledge, there is not pending or
threatened any action, suit, proceeding, inquiry or investigation, to which the
Company or any of its Subsidiaries is a party, or to which the property of the
Company or any of its Subsidiaries is subject, before or brought by any court or
governmental agency or body, of or in the United States, which might reasonably
be expected to result in a Material Adverse Effect, or which might reasonably be
expected to materially and adversely affect the properties or assets thereof or
the consummation of the transactions contemplated in the Purchase Agreement and
the Brazilian Purchase Agreement or the performance by the Company of its
obligations thereunder.
(x) Each of the form of the ADR certificate and the form of
certificate used to evidence the Common Shares complies in all material respects
with the requirements of the New York Stock Exchange.
(xi) The information in the Prospectus under "Taxation -- U.S.
Federal Income Tax Considerations," "Description of Capital Stock" and
"Description of American Depositary Shares" and in the Registration Statement
under Item 15, to the extent that it constitutes a description of the tax laws
and regulations of the United States, other United States
B-3
federal law or laws of the State of New York, or their respective agencies,
authorities or other governmental or quasi-governmental bodies, or documents or
proceedings or conclusions of United States or New York law or a summary of the
terms and provisions of the ADRs and the ADSs, has been reviewed by us and is
correct in all material respects and the opinion of such firm set forth under
"Taxation -- U.S. Federal Income Tax Considerations" is confirmed.
(xii) The Company is not an "investment company" or an entity
"controlled" by an "investment company," as such terms are defined in the 1940
Act.
(xiii) There are no statutes or regulations that are required
to be described in the Prospectus that are not described as required.
(xiv) All descriptions in the Prospectus of contracts and
other documents to which the Company or any of its Subsidiaries is a party are
accurate in all material respects; to the best of our knowledge, there are no
franchises, contracts, indentures, mortgages, loan agreements, notes, leases or
other instruments required to be described or referred to in the Registration
Statement or to be filed as exhibits thereto other than those described or
referred to therein or filed or incorporated by reference as exhibits thereto,
and the descriptions thereof or references thereto are correct in all material
respects.
Nothing has come to our attention that would lead us to
believe that the Registration Statement or any amendment thereto (except for
financial statements and schedules and other financial data included or
incorporated by reference therein or omitted therefrom, as to which we make no
statement), including the Rule 430A Information and Rule 434 Information (if
applicable), or the ADR Registration Statement at the time the Registration
Statement or the ADR Registration Statement or any such amendment 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 or any amendment or
supplement thereto (except for financial statements and schedules and other
financial data included or incorporated by reference therein or omitted
therefrom, as to which such counsel need make no statement), at the time the
Prospectus was issued, at the time any such amended or supplemented prospectus
was issued or at the Closing Time, included or includes an untrue statement of a
material fact or omitted or omits to state a material fact necessary in order to
make the statements therein, in the light of the circumstances under which they
were made, not misleading.
In rendering such opinion, such counsel may rely (A) as to
matters involving the application of the laws of Brazil upon the opinion of Dr.
Paulo Francisco de Almeidas Xxxxx, General counsel for the Company, and (B), as
to matters of fact (but not as to legal conclusions), to the extent they deem
proper, on certificates of responsible officers of the Company and public
officials. Such opinion shall not state that it is to be governed or qualified
by, or that it is otherwise subject to, any treatise, written policy or other
document relating to legal opinions, including, without limitation, the Legal
Opinion Accord of the ABA Section of Business Law (1991).
C - 1
Exhibit C
FORM OF OPINION OF SELLING SHAREHOLDERS' BRAZILIAN COUNSEL
TO BE DELIVERED PURSUANT TO
SECTION 5(d)
(i) BNDES has been duly incorporated and is validly existing
as a corporation in good standing under the laws of Brazil.
(ii) BNDES has corporate power and authority to enter into and
perform its obligations under the Purchase Agreement, the Brazilian Purchase
Agreement and the Deposit Agreement, and Brazil has corporate power and
authority to enter into and perform its obligations under the Purchase
Agreement, the Brazilian Purchase Agreement and the Deposit Agreement.
(iii) The Securities to be purchased by the Underwriters and
the Brazilian Managers from each of the Selling Shareholders have been duly
authorized and validly issued and are fully paid and non-assessable, and no
holder thereof is or will be subject to personal liability solely by reason of
being such a holder.
(iv) Each of the Selling Shareholders has valid and marketable
title to the Securities to be sold by each of the Selling Shareholders pursuant
to the Purchase Agreement and the Brazilian Purchase Agreement, free and clear
of any pledge, lien, security interest, charge, claim, equity or encumbrance of
any kind, and has full right, power and authority to sell, transfer and deliver
such Securities pursuant to the Purchase Agreement, the Brazilian Purchase
Agreement and the Deposit Agreement. When the Common Shares are delivered by
each of the Selling Shareholders to the Depositary pursuant to the Deposit
Agreement for the issuance of ADRs to the order of the Underwriters pursuant to
the Purchase Agreement, and by each of the Selling Shareholders to the order of
the Brazilian Managers, against payment of the consideration set forth therein,
the Selling Shareholders will transfer to the Underwriters and the Brazilian
Managers valid and marketable title to such Securities, free and clear of any
pledge, lien security interest charge, claim, equity or encumbrance of any kind
and no holder of the Securities is or will be subject to personal liability by
reason of being such a holder.
(v) The sale of the Common Shares by each of the Selling
Shareholders is not subject to preemptive or other similar rights of any
securityholder of the Company.
(vi) The Purchase Agreement, the Brazilian Purchase Agreement
[and the Deposit Agreement] have been duly authorized, executed and delivered by
each of the Selling Shareholders, are in proper legal form under the laws of
Brazil for the enforcement thereof against each of the Selling Shareholders.
Each of the Purchase Agreement, the Brazilian Purchase Agreement and the Deposit
Agreement constitutes the valid and legally binding
C - 2
obligation of each of the Selling Shareholders, enforceable in accordance with
its terms, subject as to enforcement to bankruptcy, insolvency, reorganization
and other laws of general applicability relating to or affecting creditors'
rights generally and to general equity principles; and it is not necessary to
ensure the legality, validity, enforceability or admissibility in evidence of
any of the aforesaid agreements in Brazil or any political subdivision thereof
that any of them be filed or recorded or enrolled with any court or authority in
Brazil or any political subdivision thereof or that any stamp, registration or
similar tax be paid in Brazil or any political subdivision thereof.
(vii) To the best of our knowledge, there is not pending or
threatened any action, suit, proceeding, inquiry or investigation, to which any
of the Selling Shareholders is a party, or to which the property of any of the
Selling Shareholders or any subsidiary is subject, before or brought by any
court or governmental agency or body, domestic or foreign, which might
reasonably be expected to materially and adversely affect the consummation of
the transactions contemplated in the Purchase Agreement, the Brazilian Purchase
Agreement or the Deposit Agreement or the performance by any of the Selling
Shareholders of its obligations thereunder.
(viii) The information in the Prospectus under "Risk Factors
-- Risks Relating to Brazil, -- Risks Relating to the CVRD Group, -- Risks
Relating to the American Depositary Shares," "Market Information," "Exchange
Rates," "Dividend Policy," "Business," "Management," "Major and Selling
Shareholders," "Related Party Transactions," "Description of Capital Stock,"
"Description of American Depositary Shares," and "Taxation -- Brazilian Tax
Considerations" and in the Registration Statement under Item 15, to the extent
that it constitutes matters of law or summaries of documents or legal matters of
Brazil or legal conclusions in respect of Brazilian law, or summaries of legal
proceedings, the terms and provisions of the Common Stock or the Company's
charter and by-laws, has been reviewed by us and is correct in all material
respects; and the opinion of such firm set forth under "Taxation -- Brazilian
Tax Considerations" is confirmed.
(ix) Each of the Selling Shareholders and its obligations
under the Purchase Agreement, the Brazilian Purchase Agreement and the Deposit
Agreement are subject to civil and commercial law and to suit in Brazil and
neither of the Selling Shareholders nor its properties, assets or revenues has
any right of immunity, on any grounds, from any legal action, suit or
proceeding, from the giving of any relief in any such legal action, suit or
proceeding, from setoff or counterclaim, from the jurisdiction of any court,
from service of process, attachment upon or prior to judgment, or attachment in
aid of execution of judgment, or from execution of a judgment, or other legal
process or proceeding for the giving of any relief or for the enforcement of
judgment, in Brazil, with respect to its obligations, liabilities or any other
matter under or arising out of or in connection with the Purchase Agreement, the
Brazilian Purchase Agreement or the Deposit Agreement; and, to the extent that
any of the Selling Shareholders and its properties, assets or revenues may have
or may hereafter become entitled to any such right of immunity in Brazil in
which proceedings may at any time be commenced, the respective Selling
Shareholder has effectively waived or agreed to waive such right to the extent
permitted by law
C - 3
and has consented to such relief and enforcement as provided in Section 14 of
the Purchase Agreement.
(x) The choice of the laws of the State of New York as the
governing law of the Purchase Agreement is a valid choice of law under the laws
of Brazil and courts of Brazil should honor this choice of law. Each of the
Selling Shareholders has the power to submit, and pursuant to the Purchase
Agreement has legally, validly, effectively and irrevocably submitted, to the
jurisdiction of any federal or state court in the State of New York, County of
New York, has the power to waive and pursuant to the Purchase Agreement has
legally, validly, effectively and irrevocably waived any objection to the venue
of a proceeding in any federal or state court in the Sate of New York, County of
New York, and has the power to designate, appoint and empower and pursuant to
the Purchase Agreement has legally, validly, effectively and irrevocably
designated, appointed and empowered an agent for service of process in any suit
or proceeding based on or arising under the Purchase Agreement, the Brazilian
Purchase Agreement or the Deposit Agreement in any federal or state court in the
State of New York, County of New York as provided in Section 15 of the Purchase
Agreement.
(xi) No transaction tax, stamp duty or similar tax or duty or
capital gains, income, withholding or other taxes are payable by or on behalf of
the Underwriters in Brazil in connection with the sale and delivery of the
Securities as contemplated by the Purchase Agreement or in connection with
execution, delivery or enforcement of the Purchase Agreement; and none of the
Underwriters (excluding any Underwriters which are also Brazilian Managers) will
be deemed to be doing business in Brazil solely by virtue of (a) the deposit
with the Depositary under the Deposit Agreement of the Common Shares against the
issuance of ADRs evidencing the ADSs, (b) the sale by each of the Selling
Shareholders of the Common Shares underlying the ADSs and delivery of the ADSs
to or for the accounts of the Underwriters, or (c) the sale and delivery outside
Brazil by the Underwriters of the ADSs.
(xii) Any final judgment for a fixed or readily calculable sum
of money rendered by any court of the State of New York or of the United States
located in the State of New York having jurisdiction under its own domestic laws
in respect of any suit, action or proceeding against any of the Selling
Shareholders based upon the Purchase Agreement would be declared enforceable
against the respective Selling Shareholder by the courts of Brazil without
reexamination, review of the merits of the cause of action in respect of which
the original judgment was given or relitigation of the matters adjudicated upon
or payment of any stamp, registration or similar tax or duty; provided that (A)
the judgment is consistent with public policy in Brazil and any relevant
political subdivision, (B) the judgment was not given or obtained by fraud or in
a manner contrary to natural justice, (C) the judgment was not based on a clear
mistake of law or fact, (D) the judgment was not directly or indirectly for the
payment of taxes or other charges of a like nature or of a fine or other
penalty, and (E) the judgment is for a fixed sum. We are not aware of any reason
why the enforcement in Brazil of such a judgment in respect of the Purchase
Agreement would be contrary to public policy in Brazil or any political
subdivision thereof.
C - 4
(xiii) It is not necessary in order to enable any Underwriter
to exercise or enforce its rights under the Purchase Agreement in Brazil or by
reason of the entry into and/or the performance of the Purchase Agreement that
all or any of the Underwriters should be licensed, qualified, authorized or
entitled to do business in Brazil.
(xiv) Except for approvals from the Central Bank and from the
CVM relating to the Purchase Agreement, which have been duly obtained, no filing
with, or authorization, approval, consent, license, order, registration,
qualification or decree of any Brazilian government, governmental
instrumentality or court is required to be obtained by the Selling Shareholders
for the due authorization and execution of the Purchase Agreement or for the
valid authorization, sale and delivery of the ADSs as contemplated by any of the
Purchase Agreement or the Prospectus.
(xv) The performance by the Underwriters and the Brazilian
Managers in Brazil of any of their rights, duties, obligations and
responsibilities under the Purchase Agreement and the Brazilian Purchase
Agreement will not violate any law applicable in Brazil.
(xvi) The execution, delivery and performance of the Purchase
Agreement, the Brazilian Purchase Agreement and the Deposit Agreement and the
consummation of the transactions contemplated in the Purchase Agreement, the
Brazilian Purchase Agreement, the Deposit Agreement and in the Registration
Statement and compliance by each of the Selling Shareholders with its
obligations under the Purchase Agreement, the Brazilian Purchase Agreement and
the Deposit Agreement will not, whether with or without the giving of notice or
passage of time or both, conflict with or constitute a breach of, or default or
Repayment Event (as defined in Section 1(a)(xiv) of the Purchase Agreement)
under or result in the creation or imposition of any lien, charge or encumbrance
upon any property or assets of any of the Selling Shareholders or any subsidiary
pursuant to any contract, indenture, mortgage, deed of trust, loan or credit
agreement, note, lease or any other agreement or instrument, known to me, to
which any of the Selling Shareholders or any subsidiary is a party or by which
it or any of them may be bound, or to which any of the property or assets of any
of the Selling Shareholders or any subsidiary is subject (except for such
conflicts, breaches or defaults or liens, charges or encumbrances that would not
have a Material Adverse Effect), nor will such action result in any violation of
the provisions of the charter or by-laws or other organizational document, as
the case may be, of any of the Selling Shareholders, if applicable, or any
subsidiary, or any applicable treaty, law, statute, rule, regulation, judgment,
order, writ or decree, known to me, of any government, government
instrumentality or court, domestic or foreign, having jurisdiction over any of
the Selling Shareholders or any subsidiary or any of their respective
properties, assets or operations.
(xvii) The Common Shares and the ADSs conform in all material
respects as to legal matters to the descriptions thereof in the Prospectus.
(xviii) The description in the Prospectus of the Brazilian
statues, regulations, legal or governmental proceedings or other documents
therein described are accurate in all material respects.
C - 5
(xix) To the best of our knowledge, neither of the Selling
Shareholders nor any of its subsidiaries is in violation of its charter or
by-laws, if applicable, and no default by any of the Selling Shareholders or any
of its subsidiaries exists in the due performance or observance of any material
obligation, agreement, covenant or condition contained in any contract,
indenture, mortgage, loan agreement, note, lease or other agreement or
instrument that is described or referred to in the Registration Statement or the
Prospectus or filed as an exhibit to the Registration Statement.
(xx) The Purchase Agreement and the Brazilian Purchase
Agreement, upon the due execution and delivery thereof, will be, in proper legal
form under the laws of Brazil for the enforcement thereof in Brazil against each
of the Selling Shareholders, and it is not necessary to ensure the legality,
validity, enforceability or admissibility in evidence of any of the aforesaid
agreements in Brazil or any political subdivision thereof that any of them be
filed or recorded or enrolled with any court or authority in Brazil or any
political subdivision thereof or that any stamp, registration or similar tax be
paid in Brazil or any political subdivision thereof; except that, in order to
enforce any of the agreements referred to in this paragraph against each of the
Selling Shareholders in Brazil, such agreements (except for the Brazilian
Purchase Agreement, if signed in Brazil) must first be (i) notarized by a local
notary and the signature of such notary authenticated by the Brazilian consulate
having jurisdiction over the place of execution; (ii) translated into Portuguese
by a sworn translator (and all Brazilian court proceedings would be based on
such translation); and (iii) registered with the Cartorio de Titulos e
Documentos in the place of the head offices of each of the Selling Shareholders,
and the party seeking enforcement will be required to pay applicable court
costs.
(xxi) Except as otherwise disclosed in the Prospectus, BNDES
has such certificates, authorizations, licenses, concessions, approvals, orders
or permits issued by the appropriate regulatory agencies or bodies of Brazil
necessary to own or lease, as the case may be, and to operate its properties and
to conduct the business now conducted by BNDES in Brazil, and BNDES is in
compliance with the terms and conditions of the foregoing, except to the extent
that the failure to have any such certificates, authorizations, licenses,
concessions, approvals, orders or permits would not have a material adverse
effect on the condition (financial or otherwise), earnings, business affairs or
business prospects of BNDES, and all such certificates, authorizations, licenses
and permits are in full force and effect, except to the extent that the failure
to have such certificates, authorizations, licenses and permits in full force
and effect would not have a material adverse effect on the condition (financial
or otherwise), earnings, business affairs or business prospects of BNDES.
(xxii) Subject to proper notarization and legalization with
the Brazilian Consulate in New York, New York, and sworn translation thereof
into Portuguese, the Purchase Agreement is in proper legal form under the laws
of Brazil for the enforcement thereof against each of the Selling Shareholders
in the courts of Brazil.
Nothing has come to our attention that would lead us to
believe that the Registration Statement or any amendment thereto, including the
Rule 430A Information and
C - 6
Rule 434 Information (if applicable), (except for financial statements and
schedules and other financial data included therein or omitted therefrom, as to
which we make no statement) or the ADR Registration Statement, at the time the
Registration Statement or the ADR Registration Statement or any such amendment
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 or any amendment or
supplement thereto (except for financial statements and schedules and other
financial data included or omitted therefrom, as to which such counsel need make
no statement), at the time the Prospectus was issued, at the time any such
amended or supplemented prospectus was issued or at the Closing Time, included
or includes an untrue statement of a material fact or omitted or omits to state
a material fact necessary in order to make the statements therein, in the light
of the circumstances under which they were made, not misleading.
In rendering such opinion, such counsel may rely (A) as to
matters involving the application of the laws of New York, upon the opinion of
Xxxxxx & Xxxxxx, special United States counsel to the Selling Shareholders, and
(B) as to matters of fact (but not as to legal conclusions), to the extent they
deem proper, on certificates of responsible officers of each of the Selling
Shareholders and public officials. Such opinion shall not state that it is to be
governed or qualified by, or that it is otherwise subject to, any treatise,
written policy or other document relating to legal opinions, including, without
limitation, the Legal Opinion Accord of the ABA Section of Business Law (1991).
D - 1
Exhibit D
FORM OF OPINION OF SELLING SHAREHOLDERS' SPECIAL U.S. COUNSEL
TO BE DELIVERED PURSUANT TO
SECTION 5(e)
(i) No filing with, or authorization, approval, consent,
license, order, registration, qualification or decree of, any court or
governmental authority or agency or any stock exchange authority, of the United
States or the State of New York (other than under the 1933 Act and the 1933 Act
Regulations, which have been obtained, or as may be required under the
securities or blue sky laws of the various states, as to which we express no
opinion) is necessary or required to be obtained by the Selling Shareholders for
the performance by the Selling Shareholders of their obligations under the
Purchase Agreement or in connection with the offer, sale or delivery of the
Securities or the consummation of the transactions contemplated by the Purchase
Agreement, the Brazilian Purchase Agreement and the Deposit Agreement.
(ii) Insofar as such authorization, execution and delivery is
governed by the laws of the State of New York, the Purchase Agreement has been
duly authorized, executed and delivered by each of the Selling Shareholders.
(iii) The execution, delivery and performance of the Purchase
Agreement and the consummation of the transactions contemplated therein and
compliance by each of the Selling Shareholders with its obligations thereunder
will not result in a violation of any U.S. federal or New York state law,
administrative regulation or administrative or court order or decree.
(iv) Assuming that the Common Shares are deposited with the
custodian under the Deposit Agreement, as agent for the Depositary, in
accordance with the terms of the Deposit Agreement, delivery of the ADSs to be
sold by the Selling Shareholders pursuant to the terms of the Purchase Agreement
will pass title to such ADSs free and clear of all liens, encumbrances, equities
and claims, to each of the several Underwriters who have purchased such ADSs in
good faith and without notice of any such lien, encumbrance, equity or claim or
any other adverse claim within the meaning of the Uniform Commercial Code.
(v) Under the laws of the State of New York relating to
submission to jurisdiction and pursuant to the Purchase Agreement, each of the
Selling Shareholders has legally, validly, effectively and irrevocably submitted
to the personal jurisdiction of any federal or state court in the State of New
York, County of New York in any suit or proceeding
D - 2
based on or arising under the Purchase Agreement and has validly and effectively
waived any objection to the venue of a proceeding in any such court as provided
in Section 15 of the Purchase Agreement; and each of the Selling Shareholders
has the power to designate, appoint and empower and pursuant to the Purchase
Agreement has validly, effectively and irrevocably designated, appointed and
empowered an agent for service of process in any suit or proceeding based on or
arising under the Purchase Agreement or the Brazilian Purchase Agreement in any
federal or state court in the State of New York, County of New York as provided
in Section 15 of the Purchase Agreement.
(vi) To the best of our knowledge, there is not pending or
threatened any action, suit, proceeding, inquiry or investigation, to which any
of the Selling Shareholders or any of its subsidiaries is a party, or to which
the property of any of the Selling Shareholders or any of its subsidiaries is
subject, before or brought by any court or governmental agency or body, of or in
the United States, which might reasonably be expected to result in a Material
Adverse Effect, or which might reasonably be expected to materially and
adversely affect the properties or assets thereof or the consummation of the
transactions contemplated in the Purchase Agreement and the Brazilian Purchase
Agreement or the performance by any of the Selling Shareholders of its
obligations thereunder.
Nothing has come to our attention that would lead us to
believe that the Selling Shareholder Information contained in the Registration
Statement or the ADR Registration Statement or any amendment thereto, including
the Rule 430A Information and Rule 434 Information (if applicable), (except for
financial statements and schedules and other financial data included or omitted
therefrom, as to which we make no statement), at the time such Registration
Statement or any such amendment 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 or any amendment or supplement thereto (except for financial
statements and schedules and other financial data included or omitted therefrom,
as to which such counsel need make no statement), at the time the Prospectus was
issued, at the time any such amended or supplemented prospectus was issued or at
the Closing Time, included or includes an untrue statement of a material fact or
omitted or omits to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading.
E - 1
Exhibit E
FORM OF OPINION OF DEPOSITARY'S COUNSEL
TO BE DELIVERED PURSUANT TO
SECTION 5(f)
(i) The Deposit Agreement has been duly authorized, executed
and delivered by the Depositary and constitutes a valid and legally binding
obligation of the Depositary and is enforceable against the Depositary in
accordance with its terms, subject as to enforcement to bankruptcy, insolvency,
reorganization and other laws of general applicability relating to or affecting
creditors' rights generally and to general equity principles.
(xxiii) Upon the due issuance by the Depositary of ADRs
evidencing ADSs against the deposit of Common Stock in accordance with the
provisions of the Deposit Agreement, such ADRs evidencing ADSs will be duly and
validly issued under the Deposit Agreement and persons in whose names such ADRs
evidencing ADSs are registered will be entitled to the rights of registered
holders of ADRs evidencing ADSs specified therein and in the Deposit Agreement.
In rendering such opinion, such counsel may state that they
express no opinion as to the laws of any jurisdiction outside the United States.
F - 1
[FORM OF LOCK-UP FROM DIRECTORS, OFFICERS OR OTHER SHAREHOLDERS PURSUANT TO
SECTION 5(U)]
Exhibit F
--, 2002
XXXXXXX XXXXX & CO.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
ABN AMRO ROTHSCHILD LLC
as Representatives of the several Underwriters
Xxxxx Xxxxx
Xxxxx Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Re: Proposed Public Offering by Companhia Vale Do Rio Doce
Dear Ladies and Gentlemen:
The undersigned, a stockholder of Companhia Vale Do Rio Doce,
a Brazilian corporation (the "Company"), understands that Xxxxxxx Xxxxx & Co.,
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated ("Xxxxxxx Xxxxx") and ABN
AMRO Rothschild LLC ("Rothschild") propose to enter into a Purchase Agreement
(the "Purchase Agreement") with the Company and the Selling Shareholders named
therein, providing for the public offering of American Depositary Shares (the
"ADSs"), representing the Company's Common Shares, no par value (the "Common
Shares").
In recognition of the benefit that such an offering will
confer upon the undersigned as a stockholder of the Company, and for other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the undersigned agrees with each underwriter to be named in the
Purchase Agreement that, during a period of 120 days from the date of the
Purchase Agreement, the undersigned will not, without the prior written consent
of Xxxxxxx Xxxxx and Xxxxxxxxxx in their capacities as Global Coordinators of an
offering of the Company's Common Shares, directly or indirectly (i) offer,
pledge, sell, contract to sell any ADSs or Common Shares, (ii) sell any option
or contract to purchase any ADSs or Common Shares, (iii) purchase any option or
contract to sell any ADSs or Common Shares, (iv) grant any option, right or
warrant for the sale of any ADSs or Common Shares, (v) lend or otherwise dispose
of or transfer any ADSs or Common Shares, (vi) file any registration statement
under the 1933 Act with respect to any of the foregoing, or (vii) enter into any
swap or any other agreement or any transaction that transfers, in whole or in
part, directly or indirectly, the economic consequence of ownership of any ADSs
or Common Shares represented thereby, whether any such swap or transaction is to
be settled by delivery of ADSs or Common Shares represented thereby, or such
other securities, in cash or otherwise. The foregoing provisions (A) apply to
(x) Common Shares and securities convertible into or exchangeable or exercisable
for or
F - 2
repayable with Common Shares and (y) Common Shares and preferred shares owned
now or acquired later by the person executing the agreement or for which the
person executing the agreement later acquires the power of disposition (B) shall
not apply to (x) the Securities to be sold hereunder or under the Brazilian
Purchase Agreement or (y) those preferred shares of the Company held by
BNDESPAR, a wholly owned subsidiary of BNDES, which may be contributed to an
investment fund intended to track the Sao Paulo Stock Exchange Index. The Global
Coordinators may, in their sole discretion, release all or any portion of the
ADSs or Common Shares subject to the foregoing restriction prior to the
expiration of the 120-day term.
Very truly yours,
Signature:
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Print Name:
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Annex A - 1
Annex A
FORM OF ACCOUNTANTS' COMFORT LETTER PURSUANT TO SECTION 5(k)
