EXHIBIT 1.1
20,000,000 SHARES
TESORO PETROLEUM CORPORATION
COMMON STOCK
UNDERWRITING AGREEMENT
February 28, 2002
Xxxxxx Brothers Inc.
As Representative of the several
Underwriters named in Schedule 1,
c/x Xxxxxx Brothers Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Tesoro Petroleum Corporation, a Delaware corporation (the
"COMPANY"), proposes, subject to the terms and conditions stated herein, to
issue and sell 20,000,000 shares (the "FIRM STOCK") of the Company's Common
Stock, par value $0.16 2/3 per share (the "COMMON STOCK") to Xxxxxx Brothers
Inc. (the "REPRESENTATIVE") and the other underwriters named in Schedule 1
hereto (collectively, with the Representative, the "UNDERWRITERS"). In addition,
the Company proposes to grant to the Underwriters an option to purchase up to an
additional 3,000,000 shares of its Common Stock on the terms and for the
purposes set forth in Section 2 (the "OPTION STOCK" and, together with the Firm
Stock, the "STOCK"). This is to confirm the agreement between the Company and
the Underwriters concerning the offer, issue and sale of the Stock.
Section 1. Representations, Warranties and Agreements of the
Company. The Company represents, warrants and agrees that:
(a) A registration statement on Form S-3, as amended by
Post-Effective Amendment No. 1 thereto (File No. 333-51789), setting
forth information with respect to the Company and the Stock has been
filed with the Securities and Exchange Commission (the "COMMISSION")
under the Securities Act of 1933, as amended (the "SECURITIES ACT"),
and become effective under the Securities Act. As used in this
Agreement, (i) "REGISTRATION STATEMENT" means the Registration
Statement on Form S-3 (File No. 333-51789), as amended by
Post-Effective Amendment No. 1 thereto, when it became effective under
the Act, and as from time to time amended or supplemented thereafter
(or if any post-effective amendment to the Registration Statement has
been filed with the Commission prior to the execution and delivery of
this Agreement, then the time that the most recent such amendment has
been declared effective by the Commission); (ii) "EFFECTIVE TIME" means
the date and the time as of which such Registration Statement was
declared effective by the Commission; (iii) "EFFECTIVE DATE" means the
date of the
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Effective Time; (iv) "BASIC PROSPECTUS" means the prospectus dated May
14, 1998 and included in Registration Statement No. 333-51789; (v)
"SUPPLEMENTAL PROSPECTUS" means the prospectus supplement dated
February 28, 2002 relating to the Stock; and (vi) "PROSPECTUS" means
the Basic Prospectus (together with all documents incorporated therein
by reference) and the Supplemental Prospectus relating to the Stock, as
filed with the Commission pursuant to paragraph (b) of Rule 424 of the
rules and regulations of the Commission under the Act (the "RULES AND
REGULATIONS"). Reference made herein to the Prospectus as amended or
supplemented shall include, without limitation, any prospectus relating
to the Stock filed with the Commission pursuant to Rule 424 of the
Rules and Regulations which amends or supplements the Prospectus.
Reference made herein to the Registration Statement or the Prospectus
shall be deemed to refer to and include any documents incorporated by
reference therein, as of the date of such Registration Statement or
Prospectus, as the case may be. Copies of the Registration Statement
have been delivered by the Company to you as the Representative of the
Underwriters. The Commission has not issued any order preventing or
suspending the use of any Prospectus or the Registration Statement, and
no proceedings for such purpose are pending before or threatened by the
Commission.
(b) The conditions for use of Form S-3, as set forth in the
General Instructions thereto, have been satisfied.
(c) Each document, if any, filed or to be filed pursuant to
the Securities Exchange Act of 1934, as amended (the "EXCHANGE ACT"),
and incorporated by reference in any Prospectus (the "INCORPORATED
DOCUMENTS") complied when filed or will comply when so filed in all
material respects to the requirements of the Securities Act or the
Exchange Act and the rules and regulations of the Commission
thereunder, as applicable, and none of such documents contained or will
contain when filed an untrue statement of a material fact or omitted or
will omit when filed to state a 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.
(d) At the Effective Time, the Registration Statement did, and
the Prospectus and any further amendments or supplements to the
Prospectus will, when they are filed with the Commission, conform in
all respects to the requirements of the Securities Act and the Rules
and Regulations and did not and will not, as of the Effective Date (as
to the Registration Statement) and as of the applicable filing date (as
to the Prospectus and any amendment or supplement thereto) contain an
untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading; provided that no representation or warranty is made as to
information contained in or omitted from the Registration Statement or
the Prospectus (or any amendments or supplements thereto) in reliance
upon and in conformity with written information furnished to the
Company through the Representative by or on behalf of any Underwriter
specifically for inclusion therein.
(e) The Company is a corporation duly organized and validly
existing in good standing under the laws of the State of Delaware with
full corporate power and authority
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to own, lease and operate its properties and conduct its business as
described in the Prospectus, and is duly qualified and registered as a
foreign corporation for the transaction of business and is in good
standing in each jurisdiction in which the character of the business
conducted by it or the location of the properties owned or leased by it
make such qualification or registration necessary (except where the
failure to so qualify or register would not have a Material Adverse
Effect (as defined below)). The Company has an authorized
capitalization as set forth under the caption "Capitalization" in the
Prospectus. All of the issued and outstanding shares of capital stock
of the Company have been duly authorized and validly issued and are
fully paid and nonassessable. As used herein, "MATERIAL ADVERSE EFFECT"
means a material adverse effect on the condition (financial or
otherwise), results of operations, business, earnings or prospects of
the Company and the Subsidiaries (as defined below), taken as a whole.
(f) Schedule 2 hereto is a complete and accurate schedule of
the names of all corporations, partnerships and joint ventures (the
"SUBSIDIARIES") which constitute "subsidiaries," as such term is
defined in Rule 405 of the Rules and Regulations. Other than the
Subsidiaries listed on Schedule 2, no corporation, partnership or other
entity in which the Company has an equity interest constitutes a
"subsidiary" as defined in Rule 405 of the Rules and Regulations. Each
Subsidiary is duly organized, validly existing and in good standing in
the jurisdiction of its incorporation or formation, as the case may be,
with full corporate or other power and authority to own, lease and
operate its properties and to conduct its business as described in the
Prospectus. Each Subsidiary is duly qualified and registered as a
foreign corporation or limited partnership, as the case may be, for the
transaction of business and is in good standing in each jurisdiction in
which the character of the business conducted by it or the location of
the properties owned or leased by it make such qualification or
registration necessary, save where the failure to so qualify or be in
good standing as a foreign corporation or limited partnership, as the
case may be, would not have a Material Adverse Effect.
(g) All of the issued and outstanding shares of capital stock
of each of the Subsidiaries that is a corporation have been duly
authorized and validly issued, are fully paid and nonassessable, and
are owned by the Company (except for one share of Tesoro Petroleum
(Singapore) Pte Ltd.) directly or indirectly, free and clear of any
lien, adverse claim, security interest or other encumbrance (a "LIEN"),
except for Liens arising from the senior secured credit facility
described in the Prospectus. All outstanding equity interests in each
Subsidiary that is not a corporation have been duly authorized and
validly issued and are owned by the Company directly or indirectly,
free and clear of any Lien, except for Liens arising from the senior
secured credit facility described in the Prospectus. Except as
disclosed in the Prospectus and as outstanding under employee benefit
plans of the Company, there are no outstanding subscriptions, rights
(preemptive or other), warrants, calls, commitments of sale or options
to acquire, or instruments convertible into or exchangeable for, nor
any restriction on the voting or transfer of, any capital stock or
other equity interest of the Company or any Subsidiary.
(h) The unissued shares of the Stock to be issued and sold by
the Company to the Underwriters hereunder have been duly and validly
authorized and reserved for issuance and, when issued and delivered
against payment therefor in accordance with this
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Agreement will be duly and validly issued, fully paid and
non-assessable; the issuance of such shares of Stock will not be
subject to any preemptive or similar rights; and the Stock will conform
to the descriptions thereof contained in the Prospectus.
(i) The shares of Common Stock outstanding prior to the
issuance of the Stock are, and upon issuance of the Stock by the
Company, the Stock will be, subject to official notice of issuance,
listed on the New York Stock Exchange.
(j) This Agreement has been duly and validly authorized,
executed and delivered by the Company and constitutes a valid and
binding agreement of the Company, enforceable against the Company in
accordance with its terms, except as such enforceability may be limited
by bankruptcy, insolvency, reorganization or other similar laws
affecting the enforcement of creditors' rights generally and subject to
the applicability of general principles of equity, and except as rights
to indemnity and contribution hereunder and thereunder may be limited
by federal or state securities laws or principles of public policy.
(k) The execution, delivery and performance of this Agreement
by the Company, compliance by the Company with all the provisions
hereof, the issuance of the Stock by the Company and the consummation
by the Company of the transactions contemplated hereby (i) will not
conflict with or result in a breach or violation of any of the terms or
provisions of, or constitute a default under, any indenture, mortgage,
deed of trust, loan agreement or other agreement or instrument to which
the Company or any Subsidiary is a party or by which the Company or any
Subsidiary is bound or to which any of the properties or assets of the
Company or any Subsidiary is subject, (ii) will not result in any
violation of the provisions of the charter, by-laws or other
organizational documents of the Company or any Subsidiary, (iii) will
not result in any violation of the provisions of any law or statute or
any order, rule, regulation, judgment or decree of any court or
governmental agency or body having jurisdiction over the Company or any
Subsidiary or any of their respective properties or assets, or (iv)
result in the imposition or creation of (or the obligation to create or
impose) a Lien under any agreement or instrument to which the Company
or any Subsidiary is a party or by which the Company or any Subsidiary
or their respective properties or assets is bound, except in the case
of clauses (i), (iii) and (iv) for such conflicts, breaches, defaults,
violations or Liens which individually or in the aggregate would not
result in a Material Adverse Effect. Except for such consents,
approvals, authorizations, other orders, filings, qualifications or
registrations (i) as have been obtained, (ii) as may be required under
applicable state securities or Blue Sky laws of various jurisdictions
in connection with the offer and sale of the Stock, or (iii) which the
failure to obtain would not result in a Material Adverse Effect, no
consent, approval, authorization, or order of or filing, qualification
or registration with, any such court or governmental agency or body is
required for the execution, delivery and performance of this Agreement
by the Company, compliance by the Company with all the provisions
hereof, the offer and sale of the Stock by the Company and the
consummation of the transactions contemplated hereby.
(l) Neither the Company nor any Subsidiary has sustained,
since the date of the latest quarterly financial statements
incorporated by reference in the Prospectus, any
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material loss or interference with its business from fire, explosion,
flood or other calamity, whether or not covered by insurance, or from
any labor dispute or court or governmental action, order or decree,
otherwise than as set forth in the Prospectus, except losses or
interferences which do not, individually or in the aggregate, have a
Material Adverse Effect; since such date, there has not been any
material change in the capital stock or other equity interest or
long-term debt or short-term debt of the Company or any Subsidiaries or
any change having a Material Adverse Effect, or any development
involving a prospective material adverse change, in or affecting the
general affairs, management, consolidated financial position,
stockholders' equity or results of operations of the Company and the
Subsidiaries, otherwise than as set forth or contemplated in the
Prospectus; and since such date, except as otherwise disclosed in the
Prospectus, the Company has not (i) issued or granted any securities,
other than pursuant to Company employee benefit plans, or (ii) declared
or paid any dividend on its capital stock.
(m) The historical consolidated financial statements
(including the related notes) of the Company which appear in and are
incorporated in the Prospectus comply as to form in all material
respects with the applicable accounting requirements of the Securities
Act, the Exchange Act and the Rules and Regulations, present fairly in
all material respects the consolidated financial position and results
of operations of the entities purported to be shown thereby, at the
dates and for the periods indicated, and have been prepared in
conformity with accounting principles generally accepted in the United
States of America applied on a consistent basis throughout the periods
involved except as noted therein. The pro forma financial statements
which appear in and are incorporated by reference in the Prospectus
present fairly in all material respects the historical transactions
contemplated by this Agreement and the Prospectus; and such pro forma
financial statements comply as to form in all material respects with
the applicable accounting requirements of the Securities Act, the
Exchange Act and the Rules and Regulations and have been prepared on a
basis consistent with the historical consolidated financial statements
of the Company. The other historical financial and statistical
information and operating data of the Company included in the
Prospectus, historical and pro forma, are in all material respects
accurately presented and prepared on a basis consistent with the
financial statements included in the Prospectus and the books and
records of the Company. The Company is not aware of any facts or
circumstances that would lead it to believe that (i) the combined
historical financial statements of The North Dakota and Utah Refining
and Marketing Business of BP Corporation North America Inc., do not
give effect to assumptions used in the preparation thereof on a
reasonable basis under the circumstances; (ii) the other historical
financial and statistical information and operating data of The North
Dakota and Utah Refining and Marketing Business of BP Corporation North
America Inc. included in the Prospectus are not accurately presented
and prepared on a basis consistent with the financial statements
included in the Prospectus; (iii) the Audited Financial Statements of
Golden Eagle Refining and Marketing Assets Business do not give effect
to assumptions used in the preparation thereof on a reasonable basis
under the circumstances; and (iv) the other historical financial and
statistical information and operating data of the Golden Eagle refinery
located in Martinez, California and the 70 associated retail sites (the
"Golden Eagle Assets") included in the Prospectus are not accurately
presented and prepared on a basis consistent with the financial
statements included in the Prospectus.
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(n) Except as described in the Prospectus, there are no
contracts, agreements or understandings between the Company and any
person granting such person the right to require the Company to file a
registration statement under the Securities Act with respect to any
securities of the Company, owned or to be owned by such person or to
require the Company to include such securities with any securities
being registered pursuant to any registration statement filed by the
Company under the Securities Act.
(o) No relationship, direct or indirect, exists between or
among the Company on the one hand, and the directors, officers,
stockholders, customers or suppliers of the Company on the other hand,
which is required to be described in the Prospectus that is not so
described.
(p) Deloitte & Touche LLP, who has audited the consolidated
financial statements of the Company and, to the Company's knowledge,
Ernst & Young LLP, who has audited the combined financial statements of
The North Dakota and Utah Refining and Marketing Business of BP
Corporation North America Inc., Xxxxxx Xxxxxxxx LLP, who has audited
the Audited Financial Statements of Golden Eagle Refining and Marketing
Assets Business, each of whose reports is included or incorporated by
reference in the Prospectus, are independent public accountants under
Rule 101 of the AICPA'S Code of Professional Conduct, and its
interpretations and rulings.
(q) Other than as set forth in the Prospectus, there are no
legal or governmental proceedings pending to which the Company or any
Subsidiary is a party or to which any of their respective properties or
assets is subject which (i) could reasonably be expected to have a
Material Adverse Effect or (ii) could materially and adversely affect
the consummation by the Company of its obligations pursuant to this
Agreement; and to the Company's knowledge, no such proceedings are
threatened or contemplated by government authorities or threatened by
others.
(r) Except as described in the Prospectus, the Company has not
sold or issued any shares of Common Stock during the six-month period
preceding the date of the Prospectus, including any sales pursuant to
Rule 144A under, or Regulations D or S of, the Securities Act other
than shares issued pursuant to employee benefit plans, qualified stock
options plans or other employee compensation plans or pursuant to
outstanding options, rights or warrants.
(s) The Company and each of the Subsidiaries have such
permits, licenses, franchises and authorizations of governmental or
regulatory authorities ("PERMITS") as are necessary to own its
respective properties and to conduct its business in the manner
described in the Prospectus, subject in each case to such
qualifications as may be set forth in the Prospectus and except where
the failure to have such permits would not have a Material Adverse
Effect; the Company and each of the Subsidiaries have fulfilled and
performed in all material respects all of its current obligations with
respect to such permits and no event has occurred which allows, or
after notice or lapse of time would allow, revocation or termination
thereof or results in any other material impairment of the rights of
the holder of any such permits, subject in each case to such
qualifications as may be set forth in the Prospectus and except where
the failure so to fulfill or perform or
7
the occurrence of such an event would not have a Material Adverse
Effect; and, except as described in the Prospectus, none of such
permits contains any restriction that is materially burdensome to the
Company and the Subsidiaries, taken as a whole.
(t) The Company and each of the Subsidiaries own or possess
adequate rights to use all material patents, patent applications,
trademarks, service marks, trade names, trademark registrations,
service xxxx registrations, copyrights and licenses necessary for the
conduct of their respective businesses, except where the failure to
have such permits would not have a Material Adverse Effect, and have no
reason to believe that the conduct of their respective businesses will
conflict with, and have not received any notice of any claim of
conflict with, any such rights of others which, in the aggregate, could
reasonably be expected to have a Material Adverse Effect.
(u) The Company and each of the Subsidiaries have good and
indefeasible title in fee simple to all real property and good and
defensible title to all personal property owned by them, in each case
free and clear of all liens, encumbrances and defects except such as
are described in the Prospectus or such as do not materially adversely
affect the value of such property or interfere with the use made and
proposed to be made of such property by the Company and the
Subsidiaries; and all real property, buildings and vessels held under
lease by the Company and the Subsidiaries are held by them under valid,
subsisting and enforceable leases, with such exceptions as are not
material and do not interfere with the use made and proposed to be made
of such property, buildings and vessels by the Company and the
Subsidiaries.
(v) No labor disturbance by the employees of the Company or
any of the Subsidiaries exists or, to the knowledge of the Company, is
imminent which might be expected to have a Material Adverse Effect;
except as disclosed in the Prospectus, neither the Company nor any of
the Subsidiaries is party to a collective bargaining agreement; and
there are no significant unfair labor practice complaints pending
against the Company or any of the Subsidiaries or, to the best of the
Company's knowledge, threatened against any of them which, in the
aggregate, could reasonably be expected to have a Material Adverse
Effect.
(w) The Company and each of the Subsidiaries are in compliance
in all material respects with all presently applicable provisions of
the Employee Retirement Income Security Act of 1974, as amended,
including the regulations and published interpretations thereunder
("ERISA"); no "REPORTABLE EVENT" (as defined in ERISA) has occurred
with respect to any "PENSION PLAN" (as defined in ERISA) for which the
Company or any of the Subsidiaries would have any liability; neither
the Company nor any of the Subsidiaries has incurred and neither do any
of them expect to incur liability under (i) title IV of ERISA with
respect to termination of, or withdrawal from, any "PENSION plan" or
(ii) Sections 412 or 4971 of the Internal Revenue Code of 1986, as
amended, including the regulations and published interpretations
thereunder (the "CODE"); and each "PENSION PLAN" for which the Company
or any Subsidiary would have any liability that is intended to be
qualified under Section 401(a) of the Code is so qualified in all
material respects and nothing has occurred, whether by action or by
failure to act, which would cause the loss of such qualification.
8
(x) The Company and each of the Subsidiaries have filed all
federal, state, local and foreign income and franchise tax returns
required to be filed through the date hereof and has paid all taxes due
thereon, and no tax deficiency has been determined adversely to the
Company or any of the Subsidiaries which has had (nor does the Company
have any knowledge of any tax deficiency which, if determined adversely
to the Company or any of the Subsidiaries, might have) a Material
Adverse Effect.
(y) The Company and each of the Subsidiaries (i) make and keep
accurate books and records and (ii) maintains internal accounting
controls which provide reasonable assurance that (A) transactions are
executed in accordance with management's authorization, (B)
transactions are recorded as necessary to permit preparation of its
financial statements and to maintain accountability for its assets, (C)
access to its assets is permitted only in accordance with management's
authorization and (D) the reported accountability for its assets is
compared with existing assets at reasonable intervals and appropriate
action is taken with respect to any difference.
(z) Except as described in the Prospectus and except such
matters as would not, singly or in the aggregate, result in a Material
Adverse Effect, (A) neither the Company nor any of the Subsidiaries is
in violation of any federal, state, local or foreign statute, law,
rule, regulation, ordinance, code, policy or rule of common law or any
judicial or administrative order, consent, decree or judgment 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 each of the 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, to the knowledge of the Company,
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 the 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 the Subsidiaries relating to
Hazardous Materials or Environmental Laws.
(aa) The Company is not, and after giving effect to the
offering and sale of the Stock and the application of the net proceeds
therefrom as described under the caption "Use of Proceeds" in the
Prospectus will not be an "INVESTMENT COMPANY" or an entity controlled
by an investment company as such terms are defined in the Investment
Company Act of 1940, as amended, and the rules and regulations
thereunder.
9
(bb) None of the Company or the Subsidiaries has taken, nor
will any of them take, directly or indirectly, any action prohibited by
Regulation M under the Securities Act.
(cc) Neither the Company, nor to its knowledge, any of its
Affiliates (as defined in Rule 501(b) of Regulation D, an "AFFILIATE"),
has taken, directly or indirectly, any action designed to cause or
result in, or which has constituted or which might reasonably be
expected to constitute, the stabilization or manipulation of the price
of the Stock to facilitate the sale or resale of such securities.
The Company acknowledges that the Underwriters and, for
purposes of the opinions to be delivered to the Underwriters pursuant to Section
7 hereof, counsel to the Company and counsel to the Underwriters, will rely upon
the accuracy and truth of the foregoing representations and hereby consents to
such reliance. Each certificate signed by any officer of the Company and
delivered to the Underwriters or counsel for the Underwriters shall be deemed to
be a representation and warranty by the Company to the Underwriters as to the
matters covered thereby.
Section 2. Purchase of the Stock by the Underwriters. On the
basis of the representations and warranties contained in, and subject to the
terms and conditions of, this Agreement, the Company agrees to issue and sell
20,000,000 shares of the Firm Stock to the several Underwriters and each of the
Underwriters, severally and not jointly, agrees to purchase the number of shares
of the Firm Stock set forth opposite that Underwriter's name in Schedule 1
hereto. The respective purchase obligations of the Underwriters with respect to
the Firm Stock shall be rounded among the Underwriters to avoid fractional
shares, as the Representative may determine.
In addition, the Company grants to the Underwriters an option
to purchase up to 3,000,000 shares of Option Stock. Such option is granted for
the purpose of covering over-allotments in the sale of Firm Stock and is
exercisable as provided in Section 4 hereof. Shares of Option Stock shall be
purchased severally for the account of the Underwriters in proportion to the
number of shares of Firm Stock set forth opposite the name of such Underwriters
in Schedule 1 hereto. The respective purchase obligations of each Underwriter
with respect to the Option Stock shall be adjusted by the Representative so that
no Underwriter shall be obligated to purchase Option Stock other than in 100
share amounts.
The price of both the Firm Stock and any Option Stock shall be
$10.69 per share.
The Company shall not be obligated to deliver any of the Stock
to be delivered on any Delivery Date (as hereinafter defined), except upon
payment for all the Stock to be purchased on such Delivery Date as provided
herein.
Section 3. Offering of Stock by the Underwriters. Upon
authorization by the Representative of the release of the Firm Stock, the
several Underwriters propose to offer the Firm Stock for sale upon the terms and
conditions set forth in the Prospectus.
Section 4. Delivery of and Payment for the Stock. Delivery of
and payment for the Firm Stock shall be made at the offices of Xxxxxxx Xxxxxxx &
Xxxxxxxx, 000 Xxxxxxxxx
00
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, at 10:00 A.M., New York City time, on the
third full business day following the date of this Agreement or at such other
date or place as shall be determined by agreement between the Representative and
the Company. This date and time are sometimes referred to as the "FIRST DELIVERY
DATE." On the First Delivery Date, the Company shall deliver or cause to be
delivered certificates representing the Firm Stock to the Representative for the
account of each Underwriter against payment to or upon the order of the Company
of the purchase price by wire transfer in immediately available funds. Time
shall be of the essence, and delivery at the time and place specified pursuant
to this Agreement is a further condition of the obligation of each Underwriter
hereunder. Upon delivery, the Firm Stock shall be registered in such names and
in such denominations as the Representative shall request in writing not less
than two full business days prior to the First Delivery Date. For the purpose of
expediting the checking and packaging of the certificates for the Firm Stock,
the Company shall make the certificates representing the Firm Stock available
for inspection by the Representative in New York, New York, not later than 2:00
P.M., New York City time, on the business day prior to the First Delivery Date.
The option granted in Section 2 will expire 30 days after the
date of this Agreement and may be exercised in whole or in part from time to
time by written notice being given to the Company by the Representative. Such
notice shall set forth the aggregate number of shares of Option Stock as to
which the option is being exercised, the names in which the shares of Option
Stock are to be registered, the denominations in which the shares of Option
Stock are to be issued and the date and time, as determined by the
Representative, when the shares of Option Stock are to be delivered; provided,
however, that this date and time shall not be earlier than the First Delivery
Date nor earlier than the second business day after the date on which the option
shall have been exercised nor later than the fifth business day after the date
on which the option shall have been exercised. The date and time the shares of
Option Stock are delivered are sometimes referred to as a "SECOND DELIVERY DATE"
and the First Delivery Date and any Second Delivery Date are sometimes each
referred to as a "DELIVERY DATE".
Delivery of and payment for the Option Stock shall be made at
the place specified in the first sentence of the first paragraph of this Section
4 (or at such other place as shall be determined by agreement between the
Representative and the Company) at 10:00 A.M., New York City time, on such
Second Delivery Date. On such Second Delivery Date, the Company shall deliver or
cause to be delivered the certificates representing the Option Stock to the
Representative for the account of each Underwriter against payment to or upon
the order of the Company of the purchase price by wire transfer in immediately
available funds. Time shall be of the essence, and delivery at the time and
place specified pursuant to this Agreement is a further condition of the
obligation of each Underwriter hereunder. Upon delivery, the Option Stock shall
be registered in such names and in such denominations as the Representative
shall request in the aforesaid written notice. For the purpose of expediting the
checking and packaging of the certificates for the Option Stock, the Company
shall make the certificates representing the Option Stock available for
inspection by the Representative in New York, New York, not later than 2:00
P.M., New York City time, on the business day prior to such Second Delivery
Date.
Section 5. Further Agreements of the Company. The Company agrees:
11
(a) To prepare the Prospectus in a form approved by the
Representative and to file such Prospectus pursuant to Rule 424(b)
under the Securities Act not later than the Commission's close of
business on the second business day following the execution and
delivery of this Agreement; to make no further amendment or any
supplement to the Registration Statement or to the Prospectus prior to
the last Delivery Date except as permitted herein; to advise the
Representative, promptly after it receives notice thereof, of the time
when any amendment to the Registration Statement has been filed or
becomes effective or any supplement to the Prospectus or any amended
Prospectus has been filed and to furnish the Representative with copies
thereof; to file promptly all reports and any definitive proxy or
information statements required to be filed by the Company with the
Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the
Exchange Act subsequent to the date of the Prospectus and for so long
as the delivery of a prospectus is required in connection with the
offering or sale of the Stock; to advise the Representative, promptly
after it receives notice thereof, of the issuance by the Commission of
any stop order or of any order preventing or suspending the use of any
Prospectus or the Registration Statement, of the suspension of the
qualification of the Stock for offering or sale in any jurisdiction, of
the initiation or threatening of any proceeding for any such purpose,
or of any request by the Commission for the amending or supplementing
of the Registration Statement or the Prospectus or for additional
information; and, in the event of the issuance of any stop order or of
any order preventing or suspending the use of any Prospectus or the
Registration Statement or suspending any such qualification, to
promptly use its best efforts to obtain its withdrawal;
(b) To deliver promptly to the Representative such number of
the following documents as the Representative shall reasonably request:
(i) conformed copies of the Registration Statement as originally filed
with the Commission and each amendment thereto (in each case excluding
exhibits) and (ii) the Basic Prospectus, the Prospectus and any amended
or supplemented Prospectus; and, if the delivery of a Prospectus is
required at any time after the Effective Time in connection with the
offering or sale of the Stock or any other securities relating thereto
and if at such time any events shall have occurred as a result of which
the Prospectus as then amended or supplemented would include an untrue
statement of a material fact or omit to state any material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made when such Prospectus is
delivered, not misleading, or, if for any other reason it shall be
necessary to amend or supplement the Prospectus in order to comply with
the Securities Act, to promptly notify the Representative and, upon its
request, to prepare and furnish without charge to each Underwriter and
to any dealer in securities as many copies as the Representative may
from time to time reasonably request of an amended or supplemented
Prospectus which will correct such statement or omission or effect such
compliance;
(c) To file promptly with the Commission any amendment to the
Registration Statement or the Prospectus or any supplement to the
Prospectus that may, in the reasonable judgment of the Company or the
Representative, be required by the Securities Act or requested by the
Commission;
12
(d) At any time prior to the completion of the distribution of
the Stock by the Underwriters, prior to filing with the Commission any
amendment to the Registration Statement or supplement to the Prospectus
or any Prospectus or any document incorporated by reference in the
Prospectus pursuant to Rule 424 of the Rules and Regulations, to
furnish a copy thereof to the Representative and counsel for the
Underwriters and obtain the consent of the Representative to the
filing;
(e) To make generally available to the Company's security
holders and to the Representative as soon as practicable an earning
statement covering a twelve-month period beginning on the first day of
the first full fiscal quarter after the date of this Agreement, which
earning statement shall satisfy the provisions of Section 11(a) of the
Securities Act and the rules and regulations of the Commission
thereunder. If such fiscal quarter is the last fiscal quarter of the
Company's fiscal year, such earning statement shall be made available
not later than 90 days after the close of the period covered thereby
and in all other cases shall be made available not later than 45 days
after the close of the period covered thereby;
(f) Promptly from time to time, to take such action as the
Representative may reasonably request to qualify the Stock for offering
and sale under the securities laws of such jurisdictions as the
Representative may request and to comply with such laws so as to permit
the continuance of sales and dealings therein in such jurisdictions for
as long as may be necessary to complete the distribution of the Stock;
provided that, in connection therewith, the Company shall not be
required to qualify as a foreign corporation or to file a general
consent to service of process in any jurisdiction;
(g) For a period of two years following the First Delivery
Date, to furnish to the Representative copies of all materials
furnished by the Company to its shareholders and all public reports and
all reports and financial statements furnished by the Company to the
principal national securities exchange upon which the Common Stock may
be listed pursuant to requirements of or agreements with such exchange
or to the Commission pursuant to the Exchange Act; provided, however,
that the Company shall not be required to provide the Representative
with any such reports or similar forms that have been filed with the
Commission by electronic transmission pursuant to XXXXX;
(h) For a period of 30 days from the date hereof, not to,
directly or indirectly, (1) offer for sale, sell, pledge or otherwise
dispose of (or enter into any transaction or device which is designed
to, or could be expected to, result in the disposition by any person at
any time in the future of) any shares of Common Stock or securities
convertible into or exchangeable or exercisable for Common Stock (other
than the Stock; shares issued pursuant to employee benefit plans,
qualified stock options or other employee compensation plans existing
on the date hereof or pursuant to currently outstanding options,
warrants or rights; Common Stock issued by the Company as consideration
for the purchase of any business or assets; or Common Stock issued by
the Company in a private equity transaction in connection with the
pending acquisition of the Golden Eagle Assets), or sell or grant
options, rights or warrants with respect to any shares of Common Stock
or securities convertible into or exchangeable or exercisable for
Common Stock (other than the grant of options pursuant to option plans
existing on the date hereof), or
13
(2) enter into any swap or other derivatives transaction that transfers
to another, in whole or in part, any of the economic benefits or risks
of ownership of such shares of Common Stock, whether any such
transaction described in clause (1) or (2) above is to be settled by
delivery of Common Stock or other securities, in cash or otherwise, in
each case without the prior written consent of the Representative on
behalf of the Underwriters; and to cause each executive officer and
director of the Company to furnish to the Representative, prior to the
First Delivery Date, a letter or letters, substantially in the form of
Exhibit A hereto (the "LOCK-UP AGREEMENTS"), pursuant to which each
such person shall agree not to, directly or indirectly, (1) offer for
sale, sell, pledge or otherwise dispose of (or enter into any
transaction or device which is designed to, or could be expected to,
result in the disposition by any person at any time in the future of)
any shares of Common Stock or securities convertible into or
exchangeable for Common Stock (other than Common Stock sold or
transferred to the Company by its directors or executive officers in
connection with the exercise of an option, warrant or right outstanding
on the date hereof) or (2) enter into any swap or other derivatives
transaction that transfers to another, in whole or in part, any of the
economic benefits or risks of ownership of such shares of Common Stock,
whether any such transaction described in clause (1) or (2) above is to
be settled by delivery of Common Stock or other securities, in cash or
otherwise, in each case for a period of 30 days from the date hereof,
without the prior written consent of the Representative on behalf of
the Underwriters;
(i) To use its best efforts to have the Stock approved by the
New York Stock Exchange ("NYSE") for listing prior to the First
Delivery Date;
(j) Not to take, directly or indirectly, any action which is
designed to stabilize or manipulate, or which constitutes or which
might reasonably be expected to cause or result in stabilization or
manipulation, of the price of any security of the Company in connection
with the offering of the Stock;
(k) To use its best efforts to cause the Stock to be accepted
for clearance and settlement through the facilities of The Depository
Trust Company;
(l) To apply the net proceeds from the issuance of the Stock
as set forth under "Use of Proceeds" in the Prospectus; and
(m) To take such steps as shall be necessary to ensure that
neither the Company nor any of its subsidiaries shall become an
"investment company" as defined under the Investment Company Act.
Section 6. Expenses. The Company agrees to pay or cause to be
paid the following expenses, whether or not the transactions contemplated by
this Agreement are consummated or this Agreement is terminated (other than
pursuant to Section 10):
(a) the costs incident to the authorization, issuance, sale
and delivery of the Stock and any taxes payable in that connection;
14
(b) the costs incident to the preparation, printing and filing
under the Securities Act of the Registration Statement, the Prospectus
and any amendments and exhibits thereto;
(c) the costs of distributing the Registration Statement as
originally filed and each amendment thereto and any post-effective
amendments thereof (including, in each case, exhibits), the Prospectus
and any amendment or supplement to the Prospectus, all as provided in
this Agreement;
(d) the costs of producing and distributing this Agreement and
the terms of any other agreement relating to the organization of the
underwriting syndicate and selling group to the members thereof, by
mail, telex or other means of communication;
(e) the filing fees incident to securing the review by the
NYSE and the National Association of Securities Dealers, Inc., of the
terms of sale of the Stock and any applicable listing or other fees;
(f) the fees and expenses of qualifying the Stock under the
securities laws of the several jurisdictions as provided in Section
5(g) and of preparing, printing and distributing a Blue Sky memorandum
(including related fees and expenses of counsel to the Underwriters);
(g) the costs and expenses of the Company relating to investor
presentations on any "ROAD SHOW" undertaken in connection with the
marketing of the offering of the Stock, including, without limitation,
expenses associated with the production of road show slides and
graphics, fees and expenses of any consultants engaged in connection
with the road show presentations with the prior approval of the
Company, travel and lodging expenses of the representatives and
officers of the Company and any such consultants, and the cost of any
aircraft chartered in connection with the road show; and
(h) all other costs and expenses incident to the performance
of the obligations of the Company under this Agreement;
provided that, except as provided in this Section 6, Section 8 and in Section
11, the Underwriters shall pay their own costs and expenses, including the costs
and expenses of their counsel.
Section 7. Conditions of Underwriters' Obligations. The
several obligations of the Underwriters hereunder are subject to the accuracy,
when made and on each Delivery Date, of the representations and warranties of
the Company contained herein, to the performance by the Company of its
obligations hereunder, and to each of the following additional terms and
conditions:
(a) The Prospectus shall have been timely filed with the
Commission in accordance with Section 5(a); no stop order suspending
the effectiveness of the Registration Statement or any part thereof
shall have been issued and no proceeding for that purpose shall have
been initiated or threatened by the Commission; and any request of the
Commission for inclusion of additional information in the Registration
Statement or the Prospectus or otherwise shall have been complied with.
15
(b) No Underwriter shall have discovered and disclosed to the
Company on or prior to such Delivery Date that the Registration
Statement, the Prospectus or any amendment or supplement thereto, in
the opinion of Xxxxxxx Xxxxxxx & Xxxxxxxx, counsel for the
Underwriters, contains an untrue statement of any fact which is
material or omits to state a fact which is material and is required to
be stated therein or is necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading;
and the Underwriters shall have obtained all necessary or required
approvals from the National Association of Securities Dealers, Inc.
(c) All corporate proceedings and other legal matters incident
to the authorization, form and validity of this Agreement, the
Registration Statement, the Prospectus, the Stock, and all other legal
matters relating to the offering, issuance and sale of the Stock and
the transactions contemplated hereby and thereby shall be reasonably
satisfactory in all material respects to counsel for the Underwriters;
and the Company shall have furnished to such counsel all documents and
information that they may reasonably request to enable them to pass
upon such matters.
(d) Fulbright & Xxxxxxxx L.L.P., outside counsel to the
Company, shall have furnished to the Underwriters its written opinion
addressed to the Underwriters and dated such Delivery Date, in form and
substance reasonably satisfactory to the Underwriters, to the effect
that:
(i) The Registration Statement was declared effective
under the Securities Act as of the date and time specified in
such opinion; the Prospectus was filed with the Commission
pursuant to the subparagraph of Rule 424(b) of the Securities
Act specified in such opinion on the date specified therein;
and, to the knowledge of such counsel, no stop order
suspending the effectiveness of the Registration Statement has
been issued and, to the knowledge of such counsel, no
proceeding for that purpose is pending or threatened by the
Commission;
(ii) The Registration Statement and the Prospectus
and any further amendments or supplements thereto related to
the Stock made by the Company prior to such Delivery Date
(other than financial statements, schedules and other
financial or statistical data included or incorporated by
reference therein or omitted therefrom, as to which such
counsel need express no opinion), when they became effective
or were filed with the Commission, as the case may be,
complied as to form in all material respects with the
requirements of Securities Act and the Exchange Act, as
applicable;
(iii) Except for such consents, approvals,
authorizations, other orders, filings, qualifications or
registrations, as have been obtained under the Securities Act
or Exchange Act, and as may be required under applicable state
securities or Blue Sky laws, as to which such counsel need
express no opinion, no consent, approval, authorization, or
order of or filing, qualification or registration with, any
governmental agency or body is required by any statutory law
or regulation as a condition for the execution and delivery of
this Agreement by the Company, or for the performance by the
Company of its obligations thereunder;
16
(iv) To such counsel's knowledge, there are no
contracts or other documents that are required to be described
in the Company's filings under the Exchange Act or filed as
exhibits to the Company's filings under the Exchange Act that
have not been so described or filed;
(v) The statements in the Prospectus under the
caption "Description of Common Stock", only insofar as such
statements constitute summaries of the terms of the Company's
common stock, fairly present the terms of such common stock in
all material respects; and
(vi) The Company is not and, after giving effect to
the offering and sale of the Stock and the application of the
proceeds thereof as described in the Prospectus, will not be
an "investment company" within the meaning of the Investment
Company Act of 1940, as amended and the rules and regulations
of the Commission thereunder.
In rendering such opinion, such counsel may state that their opinion is
limited to matters governed by the federal laws of the United States of
America, the laws of the State of Texas, the laws of the State of New
York and the General Corporation Law of the State of Delaware. Such
opinion shall also be to the effect that (x) such counsel has acted as
counsel to the Company in connection with the preparation of the
Registration Statement, such counsel participated in conferences with
officers and other representatives of the Company, the Company's
independent accountants and the Underwriters and their counsel, at
which the contents of the Registration Statement were discussed, and
while such counsel has not independently verified and is not passing
upon the accuracy, completeness or fairness of the statements made in
the Prospectus, except as explicitly set forth above, and (y) based on
the foregoing (relying as to materiality upon the statements of
officers and other representatives of the Company), no facts have come
to the attention of such counsel which lead them to believe that (i)
the Registration Statement (except for the financial statements and
financial and statistical data included or incorporated by reference
therein, as to which such counsel need express no belief), as of the
Effective Date, contained any untrue statement of a material fact or
omitted to state a material fact required to be stated therein or
necessary in order to make the statements therein not misleading, or
(ii) the Prospectus (except for the financial statements and financial
and statistical data included or incorporated by reference therein, as
to which such counsel need express no belief), as of the applicable
Delivery Date and as supplemented or amended to date, contains any
untrue statement of a material fact or omits to state a material fact
necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading.
(e) Xxxxx X. Xxxx, Xx., General Counsel of the Company, shall
have furnished to the Underwriters his written opinion addressed to the
Underwriters and dated such Delivery Date, in form and substance
reasonably satisfactory to the Underwriters, to the effect that:
(i) The Company has been duly incorporated and is
validly existing as a corporation, in good standing under the
laws of the State of Delaware, duly
17
qualified to transact business and is in good standing as a
foreign corporation in each jurisdiction where it is required
to be so qualified and the failure to do so would have a
Material Adverse Effect and has all corporate power and
authority necessary to own and lease its properties and
conduct its business as described in the Prospectus;
(ii) Each of the Subsidiaries has been duly
incorporated or formed, as the case may be, and is validly
existing as a corporation in good standing under the laws of
the jurisdiction of its incorporation or formation and is in
good standing as a foreign corporation in each jurisdiction
where it is required to be so qualified and the failure to do
so would have a Material Adverse Effect and has all corporate
or other power and authority, as the case may be, necessary to
own and lease its properties and conduct its respective
business as described in the Prospectus;
(iii) This Agreement has been duly authorized,
executed and delivered by the Company;
(iv) The Stock has been duly and validly authorized,
and when issued and delivered in accordance with the
provisions of this Agreement, will be validly issued, fully
paid and non-assessable; and the Stock will conform, when
issued, in all material respects to the description thereof
contained in the Prospectus;
(v) The Company has an authorized capitalization as
set forth in the Prospectus, and all of the issued shares of
capital stock of the Company have been duly and validly
authorized and issued, are fully paid and non-assessable and
conform to the description thereof contained in the
Prospectus;
(vi) The issuance and sale of the Stock being
delivered on such Delivery Date by the Company pursuant to
this Agreement and the execution, delivery and compliance by
the Company with this Agreement and the consummation of the
transactions contemplated hereby (a) will not result in a
breach of, or default under, any agreement or instrument that
was filed as an exhibit to the Company's Annual Report on Form
10-K for the fiscal year ended December 31, 2001 or any or
other registration statement or report filed with the
Commission by the Company since such date, and to which the
Company or any of the Subsidiaries is a party or by which the
Company or the Subsidiaries is bound or to which any of the
properties of the Company or the Subsidiaries is subject, (b)
will not violate the provisions of the charter, bylaws or
other organizational documents of the Company or any
Subsidiary or of any applicable statutory law or regulation as
the case may be, or (c) will not to such counsel's knowledge
violate any decree or order of any governmental body or agency
or court having jurisdiction over any of them;
(vii) The Incorporated Documents and any further
amendment or supplement to any such incorporated document made
by the Company prior to such Delivery Date (other than
financial statements, schedules and other financial
18
or statistical data included or incorporated by reference
therein or omitted therefrom, as to which such counsel need
express no opinion), when they became effective or were filed
with the Commission, as the case may be, complied as to form
in all material respects with the requirements of the
Securities Act and the Exchange Act, as applicable;
(viii) The descriptions in the Prospectus of
statutes, legal and governmental proceedings and contracts and
other documents are accurate in all material respects; the
statements (A) in the Prospectus under the caption "Business"
and (B) in "Item 3 - Legal Proceedings" of the Company's
annual report on Form 10-K for the year ended December 31,
2001 incorporated by reference in the Prospectus, in each case
only insofar as such statements constitute summaries of the
legal matters, documents, conclusions or proceedings referred
to therein in each case in all material respects, fairly
present the information called for with respect to such legal
matters, documents, conclusions and proceedings and fairly
summarize the matters referred to therein; and such counsel
does not know of any legal or governmental proceedings pending
or threatened to which the Company or any of its subsidiaries
is a party or to which any of the properties of the Company or
any of its subsidiaries is subject that are required to be
described in the Registration Statement or the Prospectus and
are not so described or of any statutes or regulations that
are required to be described in the Registration Statement or
the Prospectus that are not described as required;
(ix) To the knowledge of such counsel, there is no
action, suit, legal or governmental proceeding, inquiry or
investigation, to which the Company or any Subsidiary is a
party, or to which the property of any of the Company or any
Subsidiary is subject, that is required to be described in the
Prospectus and is not so described or any statutes,
regulations, contracts or other documents that are required to
be described in the Prospectus or to be filed as exhibits to
the Prospectus that are not described or filed as required and
no such action, suit, proceeding, inquiry or investigation is
threatened or contemplated; and
(x) Except as described in the Prospectus, to the
knowledge of such counsel, there are no contracts, agreements
or understandings between the Company or any Subsidiary and
any person granting such person the right to require the
Company or such Subsidiary to file a registration statement
under the Securities Act with respect to any securities of the
Company or such Subsidiary owned or to be owned by such person
or to require the Company or such Subsidiary to include such
securities in the securities registered pursuant to the
Registration Statement or in any securities being registered
pursuant to any other registration statement filed by the
Company under the Securities Act.
In rendering such opinion, such counsel may state that his opinion is
limited to matters governed by the federal laws of the United States of
America, the laws of the State of Texas and the General Corporation Law
of the State of Delaware.
19
(f) Xxxxxxx Xxxxxxx & Xxxxxxxx, shall have furnished to the
Underwriters its written opinion, as special counsel to the
Underwriters, addressed to the Underwriters and dated such Delivery
Date, in form and substance reasonably satisfactory to the
Underwriters.
(g) At the time of execution of this Agreement, the
Underwriters shall have received from each of (i) Deloitte & Touche
LLP, (ii) Ernst & Young LLP and (iii) Xxxxxx Xxxxxxxx LLP
(collectively, the "ACCOUNTANTS") letters, in form and substance
reasonably satisfactory to the Representative, addressed to the
Underwriters and dated the date hereof (i) confirming that they are
independent public accountants within the meaning of the Securities Act
and are in compliance with the applicable requirements relating to the
qualification of accountants under Rule 2-01 of Regulation S-X of the
Commission and (ii) stating, as of the date hereof (or, with respect to
matters involving changes or developments since the respective dates as
of which specified financial information is given in the Prospectus, as
of a date not more than five days prior to the date hereof), the
conclusions and findings of such firm with respect to the financial
information, operating data and other matters ordinarily covered by
accountants' "COMFORT LETTERS" to underwriters with respect to the
financial statements and certain financial information contained in or
incorporated by reference in the Prospectus.
(h) With respect to the letters of the Accountants referred to
in the preceding paragraph and delivered to the Representative
concurrently with the execution of this Agreement (the "INITIAL COMFORT
LETTER"), the Company shall have furnished to the Underwriters letters
(the "BRING-DOWN COMFORT LETTER") of each such Accountant, addressed to
the Underwriters and dated such Delivery Date (i) confirming that they
are independent public accountants within the meaning of the Securities
Act and are in compliance with the applicable requirements relating to
the qualification of accountants under Rule 2-01 of Regulation S-X of
the Commission, (ii) stating, as of the date of the bring-down letter
(or, with respect to matters involving changes or developments since
the respective dates as of which specified financial information is
given in the Prospectus, as of a date not more than five days prior to
the date of the bring-down letter), the conclusions and findings of
such firm with respect to the financial information and other matters
covered by the initial letters and (iii) confirming in all material
respects the conclusions and findings set forth in the initial letters.
(i) The lock-up agreements, each substantially in the form of
Exhibit A hereto, between the Representative and each of the directors
and executive officers of the Company relating to sales and certain
other dispositions of shares of Common Stock or certain other
securities, delivered to the Representative on or before the date
hereof, shall be in full force and effect on the Delivery Date.
(j) The Company shall have furnished to the Representative a
certificate, dated the applicable Delivery Date, of the Senior Vice
President and Chief Financial Officer of the Company and the Vice
President and Treasurer of the Company, in form and substance
reasonably satisfactory to the Representative, stating that:
20
(i) the representations, warranties and agreements of
the Company in Section 1 of this Agreement are true and
correct as of such Delivery Date; and the Company has complied
with all its agreements contained herein and has satisfied all
of the conditions on its part to be performed or satisfied
prior to or on such Delivery Date; and the conditions set
forth in Sections 7(a), 7(m), 7(n) and 7(o) have been
fulfilled;
(ii) since the respective dates as of which
information is given in the Prospectus other than as set forth
in the Prospectus (exclusive of any amendments or supplements
thereto subsequent to the date of this Agreement), (A) there
has not occurred any change or any development that might have
a Material Adverse Effect, (B) there has not been any change
in the capital stock, the short-term debt, or the long-term
debt of the Company or any of its subsidiaries that might have
a Material Adverse Effect and (C) neither the Company nor any
of its subsidiaries has incurred any material liability or
obligation, direct or contingent; and
(iii) they have carefully examined the Registration
Statement and the Prospectus and, in their opinion (A) as of
the Effective Date, the Registration Statement and Prospectus
did not include any untrue statement of a material fact and
did not omit to state a material fact required to be stated
therein or necessary to make the statements therein not
misleading, and (B) since the Effective Date no event has
occurred which should have been set forth in a supplement or
amendment to the Registration Statement or the Prospectus and
which was not so set forth.
(k) The NYSE shall have approved the Stock for listing,
subject only to official notice of issuance.
(l) The Company shall have furnished to the Underwriters such
further information, certificates and documents as the Underwriters may
reasonably request to evidence compliance with the conditions set forth
in this Section 7.
(m) Neither the Company nor any of its subsidiaries shall have
sustained since the date of the latest audited financial statements
incorporated by reference in the Prospectus (A) any material loss or
interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree, otherwise
than as set forth or contemplated in the Prospectus, or (B) since such
date there shall not have been any change in the capital stock or
long-term debt of the Company or any of its subsidiaries or any change,
or any development involving a prospective change, in or affecting the
general affairs, management, financial position, prospects,
stockholders' equity or results of operations of the Company and its
subsidiaries, otherwise than as set forth or contemplated in the
Prospectus, the effect of which, in any such case described in clause
(A) or (B), is, in the judgment of the Representative, so material and
adverse as to make it impracticable or inadvisable to proceed with the
public offering or the delivery of the Stock being delivered on the
applicable Delivery Date on the terms and in the manner contemplated in
the Prospectus and this Agreement.
21
(n) Subsequent to the execution and delivery of this
Agreement, there shall not have occurred any downgrading, nor shall any
notice have been given of any intended or potential downgrading or of
any review for a possible change that does not indicate the direction
of the possible change, in the rating accorded any of the Company's
securities by any "nationally recognized statistical rating
organization," as such term is defined for purposes of Rule 436(g)(2)
under the Securities Act.
(o) Subsequent to the execution and delivery of this Agreement
there shall not have occurred any of the following: (i) trading in
securities generally on the New York Stock Exchange or the American
Stock Exchange or the Nasdaq National Market or in the over-the-counter
market, or trading in any securities of the Company on any exchange or
in the over-the-counter market, shall have been suspended or the
settlement of such trading generally shall have been materially
disrupted or minimum prices shall have been established on any such
exchange or such market by the Commission, by such exchange or by any
other regulatory body or governmental authority having jurisdiction,
(ii) a banking moratorium shall have been declared by federal or state
authorities of the United States, (iii) the United States shall have
become engaged in hostilities, there shall have been a significant
escalation in hostilities involving the United States or there shall
have been a declaration of a national emergency or war by the United
States or (iv) there shall have occurred such a material adverse change
in general domestic or international economic, political or financial
conditions, including without limitation as a result of terrorist
activities after the date hereof, or the effect of international
conditions on the financial markets in the United States shall be such,
as to make it in the case of (iii) or (iv), in the judgment of the
Representative, impracticable or inadvisable to proceed with the public
offering or delivery of the Shares being delivered on such Delivery
Date on the terms and in the manner contemplated in the Prospectus.
All opinions, letters, evidence and certificates mentioned
above or elsewhere in this Agreement shall be deemed to be in compliance with
the provisions hereof only if they are in form and substance reasonably
satisfactory to counsel for the Underwriters.
Section 8. Indemnification and Contribution.
(a) The Company shall indemnify and hold harmless each
Underwriter, its directors, officers and employees and each person, if
any, who controls any Underwriter within the meaning of Section 15 of
the Securities Act or Section 20 of the Exchange Act, from and against
any loss, claim, damage or liability, joint or several, or any action
in respect thereof (including, but not limited to, any loss, claim,
damage, liability or action relating to purchases and sales of Stock),
to which that Underwriter, director, officer, employee or controlling
person may become subject, under the Securities Act or otherwise,
insofar as such loss, claim, damage, liability or action arises out of,
or is based upon, (i) any untrue statement or alleged untrue statement
of a material fact contained in any (A) Registration Statement or
Prospectus, or in any amendment or supplement thereto, or in the
preliminary prospectus dated February 25, 2002, or (B) blue sky
application or other document prepared or executed by the Company (or
based upon any written information furnished by the Company) filed in
any jurisdiction specifically for the purpose of qualifying any or all
of the Stock under the securities laws of any state or
22
other jurisdiction (such application, document or information being
hereinafter called a "BLUE SKY APPLICATION"), (ii) the omission or
alleged omission to state in the Registration Statement or the
Prospectus, or in any amendment or supplement thereto, or in the
preliminary prospectus dated February 25, 2002, or in any Blue Sky
Application any material fact required to be stated therein or
necessary to make the statements therein not misleading or (iii) any
act or failure to act or any alleged act or failure to act by any
Underwriter in connection with, or relating in any manner to, the Stock
or the offering contemplated hereby, and which is included as part of
or referred to in any loss, claim, damage, liability or action arising
out of or based upon matters covered by clause (i) or (ii) above
(provided that the Company shall not be liable under this clause (iii)
to the extent that it is determined in a final judgment by a court of
competent jurisdiction that such loss, claim, damage, liability or
action resulted directly from any such acts or failure to act
undertaken or omitted to be taken by such Underwriter through its gross
negligence or willful misconduct), and shall reimburse each Underwriter
and each such director, officer, employee or controlling person
promptly upon demand for any legal or other expenses reasonably
incurred by that Underwriter, director, officer, employee or
controlling person in connection with investigating or defending or
preparing to defend against any such loss, claim, damage, liability or
action as such expenses are incurred; provided, however, that the
Company shall not be liable in any such case to the extent that any
such loss, claim, damage, liability or action arises out of, or is
based upon, any untrue statement or alleged untrue statement or
omission or alleged omission made in the Registration Statement or the
Prospectus, or in any such amendment or supplement thereto, or in the
preliminary prospectus dated February 25, 2002, or in any Blue Sky
Application, in reliance upon and in conformity with written
information concerning such Underwriter furnished to the Company
through the Representative by or on behalf of any Underwriter
specifically for inclusion therein; and provided, further that with
respect to any untrue statement or alleged untrue statement or omission
or alleged omission made in the preliminary prospectus dated February
25, 2002, the Company shall not be liable to any Underwriter or its
directors, officers, employees or controlling persons, from whom the
person asserting any such losses, claims, damages, or liabilities
purchased the Stock concerned, to the extent that any such loss, claim,
damage or liability of any Underwriter or its directors, officers,
employees or controlling persons results from the fact that there was
not sent or given to such person at or prior to the written
confirmation of the sale of such shares to such person, a copy of the
Prospectus, and the untrue statement or alleged untrue statement of a
material fact or omission or alleged omission to state a material fact
in such preliminary prospectus was corrected in the Prospectus and the
Company had previously furnished copies thereof to such Underwriter on
a timely basis to permit the Prospectus to be sent or given to such
person prior to the written confirmation of the sale of such shares.
The foregoing indemnity agreement is in addition to any liability that
the Company may otherwise have to any Underwriter or to any director,
officer, employee or controlling person of that Underwriter.
(b) Each Underwriter, severally and not jointly, shall
indemnify and hold harmless the Company, its directors, officers and
employees and each person, if any, who controls the Company within the
meaning of Section 15 of the Securities Act or Section 20 of the
Exchange Act, from and against any loss, claim, damage or liability,
joint or several, or any action in respect thereof, to which the
Company or any such director,
23
officer or controlling person may become subject, under the Securities
Act or otherwise, insofar as such loss, claim, damage, liability or
action arises out of, or is based upon, (i) any untrue statement or
alleged untrue statement of a material fact contained in any (A)
Registration Statement or Prospectus, or in any amendment or supplement
thereto, or in the preliminary prospectus dated February 25, 2002, or
(B) Blue Sky Application or (ii) the omission or alleged omission to
state in any Registration Statement or Prospectus, or in any amendment
or supplement thereto, or in the preliminary prospectus dated February
25, 2002, or in any Blue Sky Application, any material fact required to
be stated therein or necessary to make the statements therein not
misleading, but in each case only to the extent that the untrue
statement or alleged untrue statement or omission or alleged omission
was made in reliance upon and in conformity with written information
concerning such Underwriter furnished to the Company through the
Representative by or on behalf of that Underwriter specifically for
inclusion therein, and shall reimburse the Company and any such
director, officer or controlling person promptly on demand for any
legal or other expenses reasonably incurred by the Company or any such
director, officer or controlling person in connection with
investigating or defending or preparing to defend against any such
loss, claim, damage, liability or action as such expenses are incurred.
The foregoing indemnity agreement is in addition to any liability that
any Underwriter may otherwise have to the Company or any such director,
officer, employee or controlling person.
(c) Promptly after receipt by an indemnified party under this
Section 8 of notice of any claim or the commencement of any action, the
indemnified party shall, if a claim in respect thereof is to be made
against the indemnifying party under this Section 8, notify the
indemnifying party in writing of the claim or the commencement of that
action; provided, however, that the failure to notify the indemnifying
party shall not relieve it from any liability that it may have under
this Section 8 except to the extent it has been materially prejudiced
by such failure and, provided, further, that the failure to notify the
indemnifying party shall not relieve it from any liability that it may
have to an indemnified party otherwise than under this Section 8. If
any such claim or action shall be brought against an indemnified party,
and it shall notify the indemnifying party thereof, the indemnifying
party shall be entitled to participate therein and, to the extent that
it wishes, jointly with any other similarly notified indemnifying
party, to assume the defense thereof with counsel reasonably
satisfactory to the indemnified party. After notice from the
indemnifying party to the indemnified party of its election to assume
the defense of such claim or action, the indemnifying party shall not
be liable to the indemnified party under this Section 8 for any legal
or other expenses subsequently incurred by the indemnified party in
connection with the defense thereof other than reasonable costs of
investigation; provided, however, that the indemnified party shall have
the right to employ counsel to represent all indemnified parties who
may be subject to liability arising out of any claim in respect of
which indemnity may be sought by the indemnified parties against the
indemnifying party under this Section 8 if, (i) the employment of such
counsel shall have been authorized by the indemnifying party in
connection with the defense of such action, (ii) the indemnifying party
shall not have engaged counsel reasonably promptly to take charge of
the defense of such action or (iii) counsel for any of the indemnified
parties shall have reasonably concluded that there may be defenses
available to the indemnified parties that are in addition to or in
conflict
24
with those available to the indemnifying party, and, in that event, the
fees and expenses of such separate counsel shall be paid by the
indemnifying party; provided, further, that in connection with any
proceedings or related proceedings in the same jurisdiction, the
indemnifying party shall not be liable for the legal fees and expenses
of more than one separate firm of attorneys (in addition to any local
counsel). No indemnifying party shall, (i) without the prior written
consent of the indemnified parties (which consent shall not be
unreasonably withheld), settle or compromise or consent to the entry of
any judgment with respect to any pending or threatened claim, action,
suit or proceeding in respect of which indemnification or contribution
may be sought hereunder (whether or not the indemnified parties are
actual or potential parties to such claim or action) unless such
settlement, compromise or consent includes an unconditional release of
each indemnified party from all liability arising out of such claim,
action, suit or proceeding, or (ii) be liable for any settlement of any
such action effected without its written consent (which consent shall
not be unreasonably withheld), but if settled with the written consent
of the indemnifying party or if there be a final judgment of the
plaintiff in any such action, the indemnifying party agrees to
indemnify and hold harmless any indemnified party from and against any
loss or liability by reason of such settlement or judgment.
(d) If the indemnification provided for in this Section 8
shall for any reason be unavailable to or insufficient to hold harmless
an indemnified party under Section 8(a) or 8(b) in respect of any loss,
claim, damage or liability, or any action in respect thereof, referred
to therein, then each indemnifying party shall, in lieu of indemnifying
such indemnified party, contribute to the amount paid or payable by
such indemnified party as a result of such loss, claim, damage or
liability, or action in respect thereof, (i) in such proportion as
shall be appropriate to reflect the relative benefits received by the
Company on the one hand and the Underwriters on the other from the
offering of the Stock or (ii) if the allocation provided by clause (i)
above is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in
clause (i) above but also the relative fault of the Company on the one
hand and the Underwriters on the other with respect to the statements
or omissions that resulted in such loss, claim, damage or liability, or
action in respect thereof, as well as any other relevant equitable
considerations. The relative benefits received by the Company on the
one hand and the Underwriters on the other with respect to such
offering shall be deemed to be in the same proportion as the total net
proceeds from the offering of the Stock purchased under this Agreement
(before deducting expenses) received by the Company, on the one hand,
and the total underwriting discounts and commissions received by the
Underwriters with respect to the shares of the Stock purchased under
this Agreement, on the other hand, bear to the total gross proceeds
from the offering of the shares of the Stock under this Agreement, in
each case as set forth in the table on the cover page of the
Prospectus. The relative fault shall be determined by reference to
whether the 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 Underwriters, the intent of
the parties and their relative knowledge, access to information and
opportunity to correct or prevent such statement or omission. The
Company and the Underwriters agree that it would not be just and
equitable if contributions pursuant to this Section 8(d) were to be
determined by pro rata allocation (even if the Underwriters were
treated as one entity for such purpose) or by any other method of
allocation that does not take into account the equitable
25
considerations referred to herein. The amount paid or payable by an
indemnified party as a result of the loss, claim, damage or liability,
or action in respect thereof, referred to above in this Section shall
be deemed to include, for purposes of this Section 8(d), any legal or
other expenses reasonably incurred by such indemnified party in
connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 8(d), no Underwriter
shall be required to contribute any amount in excess of the amount by
which the total price at which the Stock underwritten by it and
distributed to the public exceeds the amount of any damages which such
Underwriter has otherwise paid or become liable to pay by reason of any
untrue or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Securities Act) shall be entitled to contribution
from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations to contribute as
provided in this Section 8(d) are several in proportion to their
respective underwriting obligations and not joint.
(e) The Underwriters severally confirm, and the Company
acknowledges, paragraph numbers 5, 8 and 17 under the caption
"Underwriting" in the Supplemental Prospectus are correct and
constitute the only information concerning such Underwriters furnished
in writing to the Company through Xxxxxx Brothers Inc. by or on behalf
of the Underwriters specifically for inclusion in the Registration
Statement and the Prospectus.
Section 9. Defaulting Underwriters. If, on any Delivery Date,
any Underwriter defaults in the performance of its obligations under this
Agreement, the remaining non-defaulting Underwriters shall be obligated to
purchase the Stock which the defaulting Underwriter agreed but failed to
purchase on such Delivery Date in the respective proportions which the number of
shares of the Firm Stock set opposite the name of each remaining non-defaulting
Underwriter in Schedule 1 hereto bears to the total number of shares of the Firm
Stock set opposite the names of all the remaining non-defaulting Underwriters in
Schedule 1 hereto; provided, however, that the remaining non-defaulting
Underwriters shall not be obligated to purchase any of the Stock on such
Delivery Date if the total number of shares of the Stock which the defaulting
Underwriter or Underwriters agreed but failed to purchase on such date exceeds
9.09% of the total number of shares of the Stock to be purchased on such
Delivery Date, and any remaining non-defaulting Underwriter shall not be
obligated to purchase more than 110% of the number of shares of the Stock which
it agreed to purchase on such Delivery Date pursuant to the terms of Section 3.
If the foregoing maximums are exceeded, the remaining non-defaulting
Underwriters, or those other underwriters satisfactory to the Representative who
so agree, shall have the right, but shall not be obligated, to purchase, in such
proportion as may be agreed upon among them, all the Stock to be purchased on
such Delivery Date. If the remaining Underwriters or other underwriters
satisfactory to the Representative do not elect to purchase on such delivery
date the shares that the defaulting Underwriter or Underwriters agreed but
failed to purchase on such Delivery Date, this Agreement (or, with respect to
the Option Delivery Date, the obligation of the Underwriters to purchase, and of
the Company to sell, the Option Stock) shall terminate without liability on the
part of any non-defaulting Underwriter or the Company, except that the Company
will continue to be liable for the payment of expenses to the extent set forth
in Sections 6 and 11. As used in this Agreement, the term "UNDERWRITER"
includes, for all purposes of this Agreement unless the context requires
otherwise, any party not listed in
26
Schedule 1 who, pursuant to this Section 9, purchases what a defaulting
Underwriter agreed but failed to purchase.
Nothing contained herein shall relieve a defaulting
Underwriter of any liability it may have to the Company for damages caused by
its default. If other underwriters are obligated or agree to purchase the Stock
of a defaulting or withdrawing Underwriter, either the Representative or the
Company may postpone the Delivery Date for up to seven full business days in
order to effect any changes that in the opinion of counsel for the Company or
counsel for the Underwriters may be necessary in the Registration Statement, the
Prospectus or in any other document or arrangement.
Section 10. Termination. The obligations of the Underwriters
hereunder may be terminated by the Representative by notice given to and
received by the Company prior to delivery of and payment for the Firm Stock if,
prior to that time, any of the events described in Sections 7(m), 7(n) or 7(o),
shall have occurred or if the Underwriters shall decline to purchase the Stock
for any reason permitted under this Agreement.
Section 11. Reimbursement of Underwriters' Expense. If (a) the
Company shall fail to tender the Stock for delivery to the Underwriters by
reason of any failure, refusal or inability on the part of the Company to
perform any agreement on its part to be performed, or because any other
condition of the Underwriters' obligations hereunder required to be fulfilled by
the Company is not fulfilled or (b) the Underwriters shall decline to purchase
the Stock for any reason permitted under this Agreement (including the
termination of this Agreement pursuant to Section 10), the Company will
reimburse the Underwriters for all reasonable out-of-pocket expenses (including
reasonable fees and disbursements of counsel) incurred by the Underwriters in
connection with this Agreement and the proposed purchase of the Stock, and upon
demand the Company shall pay the full amount thereof to the Representative on
behalf of the Underwriters. If this Agreement is terminated pursuant to Section
9 by reason of the default of one or more Underwriters, the Company shall not be
obligated to reimburse any defaulting Underwriter on account of those expenses.
Section 12. Notices, Etc. All statements, requests, notices
and agreements hereunder shall be in writing, and:
(a) if to the Underwriters, shall be delivered or sent by
mail, telex or facsimile transmission to Xxxxxx Brothers Inc., 000
Xxxxxx Xxxxxx, Xxxxxx Xxxx, Xxx Xxxxxx 00000, Attention: Syndicate
Department (Fax: 000-000-0000), with a copy, in the case of any notice
pursuant to Section 8(c), to the Director of Litigation, Office of the
General Counsel, Xxxxxx Brothers Inc., 000 Xxxx Xxxxxx, 00xx xxxxx, Xxx
Xxxx, Xxx Xxxx 00000 (Fax: 000-000-0000); and with a copy to Xxxxxxx
Xxxxxxx & Xxxxxxxx, 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Rise X. Xxxxxx, Esq. (Fax: 000-000-0000; Telephone
000-000-0000);
(b) if to the Company, shall be delivered or sent by mail,
telex or facsimile transmission to the address of the Company set forth
in the Registration Statement, Attention: Vice President and Treasurer
(Fax: 000-000-0000);
27
provided, however, that any notice to an Underwriter pursuant to Section 8(c)
shall be delivered or sent by mail, telex or facsimile transmission to such
Underwriter at its address set forth in its acceptance telex to the
Representative, which address will be supplied to any other party hereto by the
Representative upon request. Any such statements, requests, notices or
agreements shall take effect at the time of receipt thereof. The Company shall
be entitled to act and rely upon any request, consent, notice or agreement given
or made on behalf of the Underwriters by the Representative on behalf of the
Representative.
Section 13. Persons Entitled to Benefit of Agreement. This
Agreement shall inure to the benefit of and be binding upon the Underwriters,
the Company, and their respective successors. This Agreement and the terms and
provisions hereof are for the sole benefit of only those persons, except that
(A) the representations, warranties, indemnities and agreements of the Company
contained in this Agreement shall also be deemed to be for the benefit of the
directors and officers of the Underwriters and the person or persons, if any,
who control any Underwriter within the meaning of Section 15 of the Securities
Act or Section 20 of the Exchange Act and (B) the indemnity agreement of the
Underwriters contained in Section 8(b) of this Agreement shall be deemed to be
for the benefit of directors of the Company, officers of the Company who have
signed the Registration Statement and any person controlling the Company within
the meaning of Section 15 of the Securities Act or Section 20 of the Exchange
Act. Nothing in this Agreement is intended or shall be construed to give any
person, other than the persons referred to in this Section 13, any legal or
equitable right, remedy or claim under or in respect of this Agreement or any
provision contained herein.
Section 14. Survival. The respective indemnities,
representations, warranties and agreements of the Company and the Underwriters
contained in this Agreement or made by or on behalf on them, respectively,
pursuant to this Agreement, shall survive the delivery of and payment for the
Stock and shall remain in full force and effect, regardless of any investigation
made by or on behalf of any of them or any person controlling any of them.
Section 15. Definition of the Term "BUSINESS DAY". For
purposes of this Agreement, "BUSINESS DAY" means each Monday, Tuesday,
Wednesday, Thursday or Friday, which is not a day on which banking institutions
in New York are generally authorized or obligated by law or executive order to
close.
Section 16. Governing Law. This Agreement shall be governed by
and construed in accordance with the laws of New York.
Section 17. Counterparts. This Agreement may be executed in
one or more counterparts and, if executed in more than one counterpart, the
executed counterparts shall each be deemed to be an original but all such
counterparts shall together constitute one and the same instrument.
Section 18. Headings. The headings herein are inserted for
convenience of reference only and are not intended to be part of, or to affect
the meaning or interpretation of, this Agreement.
28
If the foregoing correctly sets forth the agreement between
the Company and the Underwriters, please indicate your acceptance in the space
provided for that purpose below.
Very truly yours,
TESORO PETROLEUM CORPORATION
By /s/ XXXXXXX X. XXXXXX
--------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Senior Vice President and
Chief Financial Officer
Accepted:
XXXXXX BROTHERS INC.
For itself and as Representative
of the several Underwriters named
in Schedule 1 hereto
By XXXXXX BROTHERS INC.
By /s/ XXXX X. XxXxx, III
-----------------------------
Authorized Representative
SCHEDULE 1
Number of Shares of Firm
Stock to be
Underwriters Purchased
--------------------------
Xxxxxx Brothers Inc...................................... 17,000,000
--------------------------
Xxxxxxx, Xxxxx & Co...................................... 2,000,000
--------------------------
Friedman, Billings, Xxxxxx & Co., Inc.................... 1,000,000
--------------------------
Total 20,000,000
--------------------------
SCHEDULE 2
LIST OF SUBSIDIARIES
Coastwide Marine Services, Inc., a Texas corporation
Digicomp, Inc., a Delaware corporation
Far East Maritime Company, a Delaware corporation
Gold Star Maritime Company, a Delaware corporation
Interior Fuels Company, an Alaska corporation
Kenai Pipe Line Company, a Delaware corporation
Smiley's Super Service, Inc., a Hawaii corporation
Tesoro Alaska Company, a Delaware corporation
Tesoro Alaska Pipeline Company, a Delaware corporation
Tesoro Aviation Company, a Delaware corporation
Tesoro Crude Oil Company, a Delaware corporation
Tesoro Environmental Products Company, a Delaware corporation
Tesoro Environmental Resources Company, a Delaware corporation
Tesoro Equipment Company, a Delaware corporation
Tesoro Financial Services Holding Company, a Delaware corporation
Tesoro Gas Resources Company, Inc., a Delaware corporation
Tesoro Gasoline Marketing Company, a Delaware corporation
Tesoro Geotech Company, a Delaware corporation
Tesoro Hawaii Corporation, an Hawaii corporation
Tesoro High Plains Company, a Delaware corporation
Tesoro High Plains Pipeline Company, a Delaware corporation
Tesoro Indonesia Petroleum Company, a Delaware corporation
Tesoro Latin America Company, a Delaware corporation
Tesoro Marine Services Holding Company, a Delaware corporation
Tesoro Marine Services, LLC, a Delaware limited liability company
Tesoro Maritime Company, a Delaware corporation
Tesoro Northstore Company, an Alaska corporation
Tesoro Petroleum Companies, Inc., a Delaware corporation
Tesoro Petroleum (Singapore) Pte Ltd., a Singapore company
Tesoro Pump & Valve Company, a Delaware corporation
Tesoro Refining and Marketing Company, a Delaware corporation
Tesoro Rockies Company, a Delaware corporation
Tesoro South Pacific Petroleum Corporation, a California corporation
Tesoro Technology Company, a Delaware corporation
Tesoro Vostok Company, a Delaware corporation
Tesoro Wastach Company, a Delaware corporation
Victory Finance Company, a Delaware corporation
Exhibit A
LOCK-UP LETTER AGREEMENT
XXXXXX BROTHERS INC.
XXXXXXX, SACHS & CO.
FRIEDMAN, BILLINGS, XXXXXX & CO., INC.
c/x Xxxxxx Brothers Inc.
000 Xxxxxx Xxxxxx
Xxxxxx Xxxx, Xxx Xxxxxx 00000
Ladies and Gentlemen:
The undersigned understands that you propose to enter into an
Underwriting Agreement (the "
UNDERWRITING AGREEMENT") providing for the purchase
by you (collectively, the "UNDERWRITERS") of shares (the "SHARES") of Common
Stock, par value $0.16 2/3 per share (the "COMMON STOCK"), of Tesoro Petroleum
Corporation, Inc., a Delaware corporation (the "COMPANY"), and that the
Underwriters propose to reoffer the Shares to the public pursuant to the
Underwriting Agreement (the "OFFERING").
In consideration of the execution of the
Underwriting Agreement by the
Underwriters, and for other good and valuable consideration, the undersigned
hereby irrevocably agrees that, without the prior written consent of Xxxxxx
Brothers Inc., on behalf of the Underwriters, the undersigned will not, directly
or indirectly, (1) offer for sale, sell, pledge or otherwise dispose of (or
enter into any transaction or device which is designed to, or could be expected
to, result in the disposition by any person at any time in the future of) any
shares of Common Stock or any securities convertible into or exchangeable or
exercisable for Common Stock (other than the Stock) or substantially similar
securities (other than Common Stock sold or transferred to the Company by the
undersigned in connection with the exercise of an option, warrant or right
outstanding on the date hereof) or sell or grant options, warrants or rights
with respect to any shares of Common Stock or securities convertible into or
exchangeable or exercisable for Common Stock or substantially similar securities
(other than the grant of options pursuant to option plans existing on the date
hereof), or (2) enter into any swap or other derivatives transaction that
transfers to another, in whole or in part, any of the economic benefits or risks
of ownership of such shares of Common Stock, whether any such transaction
described in clause (1) or (2) above is to be settled by delivery of Common
Stock or other securities, in cash or otherwise, in each case for a period of 30
days after the date of the final prospectus relating to the Offering, which is
February 28, 2002.
In furtherance of the foregoing, the Company and its transfer agent are
hereby authorized to decline to make any transfer of securities if such transfer
would constitute a violation or breach of this Lock-Up Letter Agreement.
The undersigned understands that the Company and the Underwriters will
proceed with the Offering in reliance on this Lock-Up Letter Agreement. Whether
or not the Offering actually occurs depends on a number of factors, including
market conditions. Any Offering will only be made pursuant to an
Underwriting
Agreement, the terms of which are subject to negotiation
between the Company and the Underwriters. In addition, it is understood that if
the Company notifies you that it does not intend to proceed with the Offering,
if the
Underwriting Agreement does not become effective, or if the
Underwriting
Agreement (other than the provisions thereof which survive termination) shall
terminate or be terminated prior to payment for and delivery of the Stock, the
undersigned will be released from its obligations under this Lock-Up Letter
Agreement.
This Agreement shall be governed by, and construed in accordance with,
the laws of New York.
The undersigned hereby represents and warrants that the undersigned has
full power and authority to enter into this Lock-Up Letter Agreement and that,
upon request, the undersigned will execute any additional documents necessary in
connection with the enforcement hereof. Any obligations of the undersigned shall
be binding upon the heirs, personal representatives, successors and assigns of
the undersigned.
Very truly yours,
[NAME]
By:
-------------------------
Name:
Title:
Dated:
---------------------------
