EXHIBIT 1.1
INTERNATIONAL SHIPHOLDING CORPORATION
800,000 Shares
6.0% Convertible Exchangeable Preferred Stock
($1.00 par value per share)
UNDERWRITING AGREEMENT
December 29, 2004
Xxxxxx, Xxxxx Xxxxx, Incorporated
000 Xxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Ladies and Gentlemen:
International Shipholding Corporation, a Delaware corporation (the
"Company"), proposes to issue and sell to Xxxxxx, Xxxxx Xxxxx, Incorporated
("you" or the "Underwriter") an aggregate of 800,000 shares (the "Firm Shares")
of 6.0% Convertible Exchangeable Preferred Stock, $1.00 par value per share (the
"Preferred Stock"), of the Company, which Preferred Stock, at the Company's
option and subject to certain conditions, is exchangeable for the Company's 6.0%
Convertible Subordinated Notes due 2014 (the "Notes") issuable pursuant to an
indenture (the "Indenture") between the Company and The Bank of New York, as
trustee (the "Trustee") to be dated as of the time of purchase (as defined
below). The Preferred Stock is, and the Notes, when and if issued, will be,
convertible into shares (the "Conversion Shares") of the Company's Common Stock,
$1.00 par value per share (the "Common Stock"). Solely for the purpose of
covering over-allotments, the Company proposes to grant to the Underwriter the
option to purchase from the Company up to an additional 80,000 shares of the
Preferred Stock (the "Additional Shares"). The Firm Shares and the Additional
Shares are hereinafter collectively sometimes referred to as the "Shares." The
Shares, the Notes and the Conversion Shares (collectively, the "Securities") are
described in the Prospectus referred to below.
The Company has filed, in accordance with the provisions of the Securities
Act of 1933, as amended, and the rules and regulations thereunder (collectively,
the "Act"), with the Securities and Exchange Commission (the "Commission") a
registration statement on Form S-1 (File No. 333-120161), including a
prospectus, relating to the Securities. The Company has furnished to you, for
use by you and by dealers, copies of one or more preliminary prospectuses (each
such preliminary prospectus being herein called a "Preliminary Prospectus")
relating to the Securities. Except where the context otherwise requires, the
registration statement, as amended when it became or becomes effective,
including all documents filed as a part thereof, and including any information
contained in a prospectus subsequently filed with the Commission pursuant to
Rule 424(b) under the Act and deemed to be part of the registration statement at
the time of effectiveness
pursuant to Rule 430A under the Act and also including any registration
statement filed pursuant to Rule 462(b) under the Act, is herein called the
"Registration Statement," and the prospectus in the form filed by the Company
with the Commission pursuant to Rule 424(b) under the Act on or before the
second business day after the date hereof (or such earlier time as may be
required under the Act), or, if no such filing is required, the form of final
prospectus included in the Registration Statement at the time it became
effective, is herein called the "Prospectus." As used herein, "business day"
shall mean a day on which the New York Stock Exchange is open for trading.
The Company has filed, in accordance with Section 12 of the Securities
Exchange Act of 1934, as amended, and the rules and regulations thereunder
(collectively, the "Exchange Act"), a registration statement (as may be amended
prior to the time of execution of this Agreement, the "Exchange Act Registration
Statement") on Form 8-A under the Exchange Act to register, under Section 12(b)
of the Exchange Act, the Preferred Stock. As used in this Agreement, the term
"knowledge" with respect to any entity means to the knowledge of any director or
officer of such entity after due inquiry.
The Company and the Underwriter agree as follows:
1. Sale and Purchase. Upon the basis of the representations and warranties
and subject to the terms and conditions herein set forth, the Company agrees to
issue and sell to the Underwriter and the Underwriter agrees to purchase from
the Company the Firm Shares in each case at a purchase price of $48.25 per
share. The Company is advised by you that you intend (i) to make a public
offering of the Firm Shares as soon after the effective date of the Registration
Statement as in your reasonable judgment is advisable and (ii) initially to
offer the Firm Shares upon the terms set forth in the Prospectus. You may from
time to time increase or decrease the public offering price after the initial
public offering to such extent as you may determine. In addition to the
underwriting discount set forth in the Prospectus the Company shall pay to the
Underwriter a financial advisory fee equal to the greater of $600,000 or 1.5% of
the aggregate public offering price of all Firm Shares purchased.
In addition, the Company hereby grants to the Underwriter the option to
purchase, and upon the basis of the representations and warranties and subject
to the terms and conditions herein set forth, the Underwriter shall have the
right to purchase, all or a portion of the Additional Shares as may be necessary
to cover over-allotments made in connection with the offering of the Firm
Shares, at the same purchase price per share to be paid by the Underwriter to
the Company for the Firm Shares. In addition, the Company shall pay to the
Underwriter a financial advisory fee equal to the greater of $60,000 or 1.5% of
the aggregate public offering price of all Additional Shares purchased. This
option may be exercised by the Underwriter at any time and from time to time on
or before the thirtieth day following the date of the Prospectus, by written
notice to the Company. Such notice shall set forth the aggregate number of
Additional Shares as to which the option is being exercised and the date and
time when the Additional Shares are to be delivered (such date and time being
herein referred to as the "additional time of purchase"); provided, however,
that the additional time of purchase
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shall not be earlier than the time of purchase (as defined below) nor earlier
than the second business day after the date on which the option shall have been
exercised nor later than the tenth business day after the date on which the
option shall have been exercised.
2. Payment and Delivery. Payment of the purchase price for the Firm Shares
shall be made to the Company by wire transfer of immediately available funds to
the account(s) specified by the Company against delivery of the Firm Shares to
you through the facilities of The Depository Trust Company ("DTC") for the
account of the Underwriter. Such payment and delivery shall be made at 9:00
A.M., New York City time, on January 6, 2005 (unless another time shall be
agreed to by you and the Company). The time at which such payment and delivery
are to be made is hereinafter sometimes called "the time of purchase."
Electronic transfer of the Firm Shares shall be made to you at the time of
purchase in such names and in such denominations as you shall specify.
Payment of the purchase price for the Additional Shares shall be
made at the additional time of purchase in the same manner and at the same
office as the payment for the Firm Shares (unless otherwise agreed to by you and
the Company). Electronic transfer of the Additional Shares shall be made to you
at the additional time of purchase in such names and in such denominations as
you shall specify.
Deliveries of the documents described in Section 6 hereof with
respect to the purchase of the Shares shall be made at the offices of Xxxxxxx
LLP at 0 Xxxxxxx Xxxxx, Xxxxxxxxx, Xxxxxxxx 00000, at 9:00 A.M., New York City
time, on the date of the closing of the purchase of the Firm Shares or the
Additional Shares, as the case may be.
3. Representations, Warranties and Covenants of the Company. The Company
represents and warrants to and agrees with the Underwriter that:
(a) the Registration Statement has been declared effective under the
Act; no stop order of the Commission preventing or suspending the use of
any Preliminary Prospectus or the effectiveness of the Registration
Statement has been issued and no proceedings for such purpose have been
instituted or, to the Company's knowledge after due inquiry, are
contemplated by the Commission; each Preliminary Prospectus, at the time
of filing thereof, complied in all material respects with the requirements
of the Act, and the last Preliminary Prospectus distributed in connection
with the offering of the Shares did not, as of its date, and does not
contain an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading; the Registration Statement complied when it became effective,
complies and, at the time of purchase and any additional time of purchase
and any time at which any sales with respect to which the Prospectus is
delivered, will comply with the requirements of the Act, and the
Prospectus will comply, as of its date and at the time of purchase and any
additional times of purchase and any time at which any sales with respect
to which the Prospectus is delivered, with the requirements of
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the Act; any statutes, regulations, contracts or other documents that are
required to be described in the Registration Statement or the Prospectus
or to be filed as exhibits to the Registration Statement have been and
will be so described or filed; the conditions to the use of Form S-1 have
been satisfied; the Registration Statement did not when it became
effective, does not and, at the time of purchase and any additional time
of purchase and any time at which any sales with respect to which the
Prospectus is delivered, will not contain an untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading, and
the Prospectus will not, as of its date and at the time of purchase and
any additional time of purchase and any time at which any sales with
respect to which the Prospectus is delivered, 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,
however, that the Company makes no warranty or representation with respect
to any statement contained in the last Preliminary Prospectus, the
Registration Statement or the Prospectus in reliance upon and in
conformity with information concerning an Underwriter and furnished in
writing by or on behalf of such Underwriter through you to the Company
expressly for use in the last Preliminary Prospectus, the Registration
Statement or the Prospectus; the Exchange Act Registration Statement has
become effective as provided in Section 12 of the Exchange Act; and the
Company has not distributed and will not distribute any "prospectus"
(within the meaning of the Act) or offering material in connection with
the offering or sale of the Shares other than the Registration Statement,
the then most recent Preliminary Prospectus and the Prospectus;
(b) each of the Company and each of the subsidiaries listed on
Exhibit 21.1 to the Registration Statement (the "Subsidiaries") has been
duly organized and is validly existing and in good standing under the laws
of its respective jurisdiction of organization with authority and power,
corporate or otherwise, to own, lease and operate its properties and to
conduct its business as described in the Registration Statement and the
Prospectus and, with respect to the Company, to: (i) execute and deliver
this Agreement and to issue, sell and deliver the Shares as contemplated
herein, (ii) execute, issue and deliver the Indenture and the Notes and
perform its obligations thereunder, and (iii) issue and deliver the
Conversion Shares in accordance with the terms of the Certificate of
Designations of the 6.0% Convertible Exchangeable Preferred Stock of the
Company in the form filed as an exhibit to the Registration Statement (the
"Certificate of Designations") or the Indenture, as the case may be; each
of the Company and the Subsidiaries is duly qualified as a foreign entity
to transact business in good standing in each jurisdiction in which such
qualification is required, whether by reason of the ownership or leasing
of property and assets or the conduct of business or otherwise, except
where the failure to so qualify would not have a material adverse effect
on the condition (financial or otherwise), results of operations,
business, properties, assets or business prospects of the Company and the
Subsidiaries taken as a whole (a "Material Adverse Effect");
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(c) as of the date of this Agreement, the Company has an authorized
and outstanding capitalization as set forth in the sections of the
Registration Statement and the Prospectus entitled "Capitalization" and
"Description of Common Stock," and, as of the time of purchase and the
additional time of purchase, as the case may be, the Company shall have an
authorized and outstanding capitalization as set forth in the sections of
the Registration Statement and the Prospectus entitled "Capitalization,"
"Description of the Preferred Stock" and "Description of Common Stock"
(subject, in each case, to the issuance of shares of Common Stock upon
exercise of stock options disclosed as outstanding in the Registration
Statement and the Prospectus and the grant of options under the Company's
Stock Incentive Plan); all of the issued and outstanding shares of capital
stock, including the Common Stock, of the Company have been duly
authorized and validly issued and are fully paid and non-assessable, have
been issued in compliance with all federal and state securities laws,
except for any failure to comply that could not, individually or in the
aggregate, have a Material Adverse Effect, and were not issued in
violation of any preemptive right, right of first refusal or similar
right; the Certificate of Designations has been duly authorized and
approved in accordance with the Delaware General Corporation Law, will be
filed with the Secretary of State of the State of Delaware on or before
the time of purchase, requires no governmental or third party consent or
approval prior to its becoming effective other than acceptance for
recording by the Secretary of State of the State of Delaware, shall become
effective and in full force and effect on or before the time of purchase
and immediately subsequent to the filing of the Certificate of
Designations, the Company will be duly incorporated and validly existing
as a corporation in good standing under the laws of the State of Delaware;
(d) all of the issued and outstanding shares of capital stock of
each of the Subsidiaries have been duly authorized and validly issued and
are fully paid and non-assessable, have been issued in compliance with all
federal and state securities laws, except for any failure to comply that
could not, individually or in the aggregate, have a Material Adverse
Effect, and were not issued in violation of any preemptive right, right of
first refusal or similar right; and are owned by the Company either
directly or through wholly-owned subsidiaries, free and clear of any
liens, claims or encumbrances of any kind; the Company has no direct or
indirect subsidiaries (as defined under the Act) other than the
Subsidiaries, the Subsidiaries include the only significant subsidiaries
of the Company as defined by Rule 1-02 of Regulation S-X and, except as
described in the Registration Statement and the Prospectus, the Company
does not own, directly or indirectly, any shares of stock or any other
equity or long-term debt securities of any corporation or have any equity
interest in any firm, partnership, joint venture, association or other
entity other than the Subsidiaries;
(e) true, complete and correct copies of the Restated Certificate of
Incorporation (the "Certificate") and the By-laws (the "Bylaws") of the
Company
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and all amendments (including, without limitation, any certificates of
designations) thereto have been delivered to you, and, except for the
filing and effectiveness of the Certificate of Designations, no changes
therein will be made on or after the date hereof or on or before the time
of purchase or, if later, the additional time of purchase;
(f) the Shares have been duly and validly authorized and, when
issued and delivered against payment therefor as provided herein, will be
duly and validly issued, fully paid and non-assessable and free of
statutory and contractual preemptive rights, rights of first refusal and
similar rights;
(g) the Conversion Shares have been duly authorized and reserved for
issuance upon conversion of the Shares or the Notes, as the case may be,
and if and when issued in accordance with the Certificate of Designations
or the Indenture, as the case may be, will be duly and validly issued,
fully paid and nonassessable and free of statutory and contractual
preemptive rights, rights of first refusal and similar rights;
(h) the Notes are in the form contemplated by the Indenture, have
been duly authorized by the Company for issuance pursuant to the terms of
the Indenture and, when executed by the Company and authenticated by the
Trustee in the manner provided in the Indenture, will constitute valid and
binding obligations of the Company, entitled to the benefits provided by
the Indenture, and enforceable against the Company in accordance with
their terms, except as the enforcement thereof may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar laws
relating to or affecting enforcement of the rights and remedies of
creditors or by general equitable principles;
(i) the capital stock of the Company, including the Shares and the
Conversion Shares, conforms in all material respects to the description
thereof contained in the Registration Statement and the Prospectus, and
the certificates for the Shares and the Conversion Shares are in due and
proper form and the holders of the Shares and the Conversion Shares will
not be subject to personal liability by reason of being such holders;
(j) this Agreement has been duly authorized, executed and delivered
by the Company;
(k) the Indenture and the Notes conform in all material respects to
the descriptions thereof in the Registration Statement and the Prospectus;
(l) the Indenture has been duly and validly authorized by the
Company, and assuming due authorization, execution and delivery of the
Indenture by the Trustee, will constitute a legally valid and binding
agreement of the Company, enforceable against the Company in accordance
with its terms,
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except as the enforcement thereof may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws relating to
or affecting enforcement of the rights and remedies of creditors or by
general equitable principles; the Indenture (i) has been duly qualified
under the Trust Indenture Act of 1939, as amended (the "Trust Indenture
Act"), and (ii) complies as to form with the requirements of the Trust
Indenture Act; as of each of the time of purchase and any additional times
of purchase, as applicable, no event will have occurred nor will any
circumstance have arisen which, had the Notes been issued on such date,
would constitute an Event of Default (as such term is defined in the
Indenture);
(m) neither the Company nor any of the Subsidiaries is in breach or
violation of or in default under (and no event has occurred which with
notice, lapse of time or both would result in any breach or violation of,
constitute a default under or give the holder of any indebtedness (or a
person acting on such holder's behalf) the right to require the
repurchase, redemption or repayment of all or a part of such indebtedness
under) (A) its articles of incorporation, by-laws or other charter
documents (including, with respect to the Company, the Certificate and the
Bylaws) (collectively, "Organization Documents"), (B) any indenture,
mortgage, deed of trust, bank loan, credit agreement, other evidence of
indebtedness, license, lease, contract or other agreement or instrument to
which it is a party or by which it or any of its properties may be bound
or affected or (C) any federal, state, local or foreign law, regulation or
rule or any decree, judgment or order applicable to, or of any court or
other governmental or regulatory authority, agency or other body with
jurisdiction over, the Company or any Subsidiary or any of their
respective assets or properties, except, in the case of clauses (B) and
(C), for breaches, violations, defaults and events that would not,
individually or in the aggregate, have a Material Adverse Effect;
(n) the execution, delivery and performance of this Agreement, the
Indenture and the Notes, the consummation of the transactions contemplated
by this Agreement, the Certificate of Designations, the Indenture and the
Notes (collectively, the "Transaction Documents"), the execution, filing
and effectiveness of the Certificate of Designations, the issuance and
sale of the Shares, the issuance of the Notes in compliance with the
Indenture and the issuance of the Conversion Shares in compliance with the
Certificate of Designations or the Indenture, as the case may be, will not
conflict with, result in any breach or violation of or constitute a
default under (nor constitute an event which with notice, lapse of time or
both would result in any breach or violation of or constitute a default
under or give the holder of any indebtedness (or a person acting on such
holder's behalf) the right to require the repurchase, redemption or
repayment of all or a part of such indebtedness under) (A) the
Certificate, Bylaws or any Organizational Documents of the Company or any
Subsidiary, (B) any indenture, mortgage, deed of trust, bank loan, credit
agreement, other evidence of indebtedness, license, lease, contract or
other agreement or instrument to which the Company or any Subsidiary is a
party or by which the Company, any
7
Subsidiary or any of their respective properties may be bound or affected
or (C) any federal, state, local or foreign law, regulation or rule or any
decree, judgment or order applicable to, or of any court or other
governmental or regulatory authority, agency or other body with
jurisdiction over, the Company or any Subsidiary or any of their
respective assets or properties, except, in the case of clauses (B) and
(C), for breaches, violations, defaults and events that would not,
individually or in the aggregate, have a Material Adverse Effect;
(o) no approval, authorization, consent or order of or filing with
any federal, state, local or foreign governmental or regulatory
commission, board, body, authority or agency, or of or with the New York
Stock Exchange, Inc., or approval of the stockholders of the Company, is
required in connection with the execution, delivery and performance of
this Agreement, the Indenture, the issuance and sale of the Shares, the
issuance of the Conversion Shares, the issuance of the Notes, or the
consummation by the Company of the transactions contemplated by the
Transaction Documents other than the registration of the Securities under
the Act, qualification of the Indenture under the Trust Indenture Act,
filing with and acceptance by the Delaware Secretary of State of the
Certificate of Designations, authorization for quotation of the Preferred
Stock on or with the New York Stock Exchange, each of which has been
effected (except for the filing with and acceptance by the Delaware
Secretary of State of the Certificate of Designations, which shall occur
prior to the time of purchase), listing of the Notes on the New York Stock
Exchange, the American Stock Exchange or another similar securities
exchange or securities trading market and such other conditions to
issuance of the Notes as are set forth in the Indenture, and any necessary
qualification under the securities or blue sky laws of the various
jurisdictions in which the Shares are being offered by the Underwriter or
under the rules and regulations of the NASD;
(p) except as expressly set forth in the Registration Statement and
the Prospectus, (i) no person has the right, contractual or otherwise, to
cause the Company to issue or sell to it any shares of Common Stock or
shares of any other capital stock or other equity interests of the
Company, (ii) no person has any preemptive rights, rights of first refusal
or other rights to purchase any shares of Common Stock or shares of any
other capital stock of or other equity interests in the Company, and (iii)
no person has the right to act as an underwriter or as a financial advisor
to the Company in connection with the offer and sale of the Shares, in the
case of each of the foregoing clauses (i), (ii) and (iii), whether as a
result of the filing or effectiveness of the Registration Statement or the
sale of the Shares as contemplated thereby or otherwise; no person has the
right, contractual or otherwise, to cause the Company to register under
the Act any shares of Common Stock or shares of any other capital stock of
or other equity interests in the Company, or to include any such shares or
interests in the Registration Statement or the offering contemplated
thereby, whether as a result of the filing or effectiveness of the
Registration Statement or the sale of the Shares as contemplated thereby
or otherwise; and, except as disclosed in the Registration
8
Statement and Prospectus, no person has the right, exercisable during the
Lock-Up Period (as defined below), to cause the Company to purchase any
capital stock or other security of the Company;
(q) each of the Company and the Subsidiaries owns, possesses or has
obtained all permits, licenses, consents, orders, approvals, franchises
and authorizations of governmental or regulatory authorities and has
obtained all necessary licenses, authorizations, consents and approvals
from other persons, ("Permits"), as are necessary to own or lease its
properties and to conduct its businesses in the manner described or
contemplated in the Registration Statement and the Prospectus, except
where the failure to own, possess or obtain such Permits could not,
individually or in the aggregate, have a Material Adverse Effect; each of
the Company and the Subsidiaries has fulfilled and performed in all
material respects all of its obligations with respect to such Permits and
no event has occurred, or as a result of the consummation of the
transactions contemplated hereby or in the Registration Statement and the
Prospectus would occur, which allows, or after notice or lapse of time or
both would allow, revocation or termination thereof or results or would
result in any other material impairment of the rights of the holder of any
such Permit; except as described in the Registration Statement and the
Prospectus, none of such Permits contains any material limitation on the
ability of the Company or any of the Subsidiaries to own its respective
properties or to conduct its business in the manner described in the
Registration Statement and the Prospectus; none of the Company or any of
the Subsidiaries has any knowledge of a threatened revocation or
modification relating to any such Permit; and none of the Company or any
of the Subsidiaries is in violation of, or in default under, any federal,
state, local or foreign law, treaty, regulation or rule or any decree,
order or judgment applicable to the Company or any Subsidiary, except
where such violation or default would not, individually or in the
aggregate, have a Material Adverse Effect;
(r) all legal or governmental proceedings, affiliate transactions,
off-balance sheet transactions (including, without limitation,
transactions related to, and the existence of, "variable interest
entities" within the meaning of Financial Accounting Series Interpretation
No. 46), contracts, licenses, agreements, leases or documents of a
character required to be described in the Registration Statement or the
Prospectus or to be filed as an exhibit to the Registration Statement have
been so described or filed as required;
(s) there are no actions, suits, claims, investigations or
proceedings pending or threatened or, to the Company's or any Subsidiary's
knowledge, contemplated to which the Company, any of the Subsidiaries or
any of their respective directors or officers is or would be a party or of
which any of their respective properties is or would be subject at law or
in equity, before or by any federal, state, local or foreign governmental
or regulatory commission, board, body, authority or agency, except any
such action, suit, claim, investigation or proceeding which would not
result in a judgment, decree or order having,
9
individually or in the aggregate, a Material Adverse Effect or preventing
consummation of the transactions contemplated hereby, except as set forth
in the Registration Statement and the Prospectus;
(t) Ernst & Young LLP, whose report on the financial statements of
the Company is included the Registration Statement and the Prospectus, are
independent public accountants as required by the Act and by Rule 3600T of
the Public Company Accounting Oversight Board (the "PCAOB");
(u) the financial statements included in the Registration Statement
and the Prospectus, together with the related notes and schedules, present
fairly the financial position of the Company and its consolidated
subsidiaries on a consolidated basis as of the dates indicated and the
respective results of operations and cash flows of the Company and its
consolidated subsidiaries for the periods specified and have been prepared
in compliance with the requirements of the Act and in conformity with
generally accepted accounting principles applied on a consistent basis
during the periods involved; any pro forma financial statements or data
included in the Registration Statement and the Prospectus comply with the
requirements of Regulation S-X of the Act, including, without limitation,
Article 11 thereof, and the assumptions used in the preparation of such
pro forma financial statements and data are reasonable, the pro forma
adjustments used therein are appropriate to give effect to the
transactions or circumstances described therein and the pro forma
adjustments have been properly applied to the historical amounts in the
compilation of those statements and data; the other financial and
statistical data set forth in the Registration Statement and the
Prospectus are accurately presented and prepared on a basis consistent
with the financial statements and books and records of the Company; there
are no financial statements (historical or pro forma) that are required to
be included in the Registration Statement and the Prospectus (including,
without limitation, as required by Rules 3-12 or 3-05 or Article 11 of
Regulation S-X under the Act) that are not included as required; the
Company and its consolidated subsidiaries do not have any material
liabilities or obligations, direct or contingent (including any
off-balance sheet obligations or any "variable interest entities" within
the meaning of Financial Accounting Series Interpretation No. 46), not
disclosed in the Registration Statement and the Prospectus; and all
disclosures contained in the Registration Statement or the Prospectus
regarding "non-GAAP financial measures" (as such term is defined by the
rules and regulations of the Commission) comply with Regulation G of the
Exchange Act and Item 10 of Regulation S-K under the Act, to the extent
applicable;
(v) subsequent to the respective dates as of which information is
given in the Registration Statement and the Prospectus, there has not been
(i) any material adverse change, or any development involving a
prospective material adverse change, in the business, properties,
management, financial condition or results of operations of the Company or
any of the Subsidiaries, (ii) any transaction which is material to the
Company or any of the Subsidiaries, (iii) any
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obligation, direct or contingent (including any off-balance sheet
obligations), incurred by the Company or any of the Subsidiaries, which is
material to the Company, (iv) any change in the capital stock or
outstanding indebtedness of the Company or any of the Subsidiaries, or (v)
any dividend or distribution of any kind declared, paid or made on the
capital stock of the Company;
(w) the Company has obtained for the benefit of the Underwriter the
agreement (a "Lock-Up Agreement"), in the form set forth as Exhibit A
hereto, of each of its directors and executive officers;
(x) neither the Company nor any of the Subsidiaries is now, nor will
any of them be, after giving effect to the offering and sale of the Shares
and application of the net proceeds from such offering and sale as
described in the Registration Statement and the Prospectus under the
heading "Use of Proceeds" and consummation of each of the transactions
contemplated by the Registration Statement and the Prospectus, 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 (the "Investment Company Act");
(y) neither the Company nor any of the Subsidiaries is now, nor will
any of them be, after giving effect to the offering and sale of the
Shares, a "holding company" or a "subsidiary company" of a "holding
company" or an "affiliate" of a "holding company" or of a "subsidiary
company," as such terms are defined in the Public Utility Holding Company
Act of 1935, as amended (the "Public Utility Holding Company Act");
(z) each of the Company and the Subsidiaries has good and marketable
title in fee simple to all real property and good and marketable title to
all personal property (including each of the vessels listed in the
Prospectus and the Registration Statement) described the Registration
Statement or in the Prospectus as being owned by it, free and clear of all
liens, claims, security interests or other encumbrances except for such
liens, claims, security interests or other encumbrances as are described
in the Registration Statement or the Prospectus or which, individually or
in the aggregate, would not have or result in a Material Adverse Effect;
all the property described in the Registration Statement and the
Prospectus as being held under lease by the Company or any of the
Subsidiaries is held thereby under valid, subsisting and enforceable
leases, except where the failure to so hold could not, individually or in
the aggregate, have a Material Adverse Effect; all leases, contracts and
agreements to which the Company or any of the Subsidiaries is a party or
by which any of them is bound are valid and enforceable against the
Company or such Subsidiary, and are valid and enforceable against the
other party or parties thereto and are in full force and effect with only
such exceptions as would not, individually or in the aggregate, have a
Material Adverse Effect; the Company and the Subsidiaries own or possess
adequate licenses or other rights to use all patents, trademarks, service
marks, trade names, copyrights and know-how necessary to conduct the
businesses now
11
or proposed to be operated by them as described in the Registration
Statement and the Prospectus, except where the failure to own or possess
such licenses or other rights could not, individually or in the aggregate,
have a Material Adverse Effect, and none of the Company or the
Subsidiaries has received any notice of infringement of or conflict with
(or knows of any such infringement of or conflict with) asserted rights of
others with respect to any patents, trademarks, service marks, trade
names, copyrights or know-how;
(aa) Except for matters which would not, individually or in the
aggregate, have a Material Adverse Effect, (i) there is (A) no unfair
labor practice complaint pending or, to the Company's or any Subsidiary's
knowledge after due inquiry, threatened against the Company or any
Subsidiary before the National Labor Relations Board, and no grievance or
arbitration proceeding arising out of or under any collective bargaining
agreement is pending or threatened, (B) no strike, labor dispute, slowdown
or stoppage pending or, to the Company's or any Subsidiary's knowledge
after due inquiry, threatened against the Company or any Subsidiary and
(C) no union representation dispute currently existing concerning the
employees of the Company or of any Subsidiary, and (ii) to the Company's
or any Subsidiary's knowledge after due inquiry, (A) no union organizing
activities are currently taking place concerning the employees of the
Company or any Subsidiary and (B) there has been no violation of any
federal, state, local or foreign law or regulation relating to
discrimination in the hiring, promotion or pay of employees, labor
practices, immigration, social security, occupational safety and health,
or plant closing, or of any applicable wage or hour laws, concerning the
employees of the Company or any Subsidiary; the minimum funding standard
under Section 302 of the Employee Retirement Income Security Act of 1974,
as amended, and the regulations and published interpretations thereunder
("ERISA"), has been satisfied by each "pension plan" (as defined in
Section 3(2) of ERISA) which has been established or maintained by the
Company and/or one or more of the Subsidiaries, and the trust forming part
of each such plan which is intended to be qualified under Section 401 of
the Internal Revenue Code of 1986, as amended (the "Code"), is so
qualified; each of the Company and the Subsidiaries has fulfilled its
obligations, if any, under Section 515 of ERISA; neither the Company nor
any of the Subsidiaries maintains or is required to contribute to a
"welfare plan" (as defined in Section 3(1) of ERISA) which provides
retiree or other post-employment welfare benefits or insurance coverage
(other than "continuation coverage" (as defined in Section 602 of ERISA));
each pension plan and welfare plan established or maintained by the
Company and/or one or more of its Subsidiaries is in compliance in all
material respects with the currently applicable provisions of ERISA, and
neither the Company nor any of the Subsidiaries has incurred or could
reasonably be expected to incur excise tax obligations under Sections 4971
through 4980G of the Code, any penalties under section 502(c) or (l) of
ERISA, any withdrawal liability under Section 4201 of ERISA, any liability
under Section 4062, 4063, or 4064 of ERISA, or any other liability under
Title IV of ERISA;
12
(bb) the Company, each Subsidiary and their respective properties,
assets and operations are in compliance with, and hold all permits,
authorizations and approvals required under, Environmental Laws (as
defined below), except to the extent that failure to so comply or to hold
such permits, authorizations or approvals would not, individually or in
the aggregate, have a Material Adverse Effect; there has been no storage,
generation, transportation, handling, treatment, disposal, discharge,
emission or other release of any Hazardous Materials (as defined below)
due to, caused by or otherwise relating to the operations of the Company
or any Subsidiary (or, to the knowledge of the Company or any Subsidiary,
any other entity (including any predecessor) for whose acts or omission
the Company or any Subsidiary is or could reasonably be expected to be
liable); there are no past, present or, to the Company's or any
Subsidiary's knowledge, reasonably anticipated future events, conditions,
circumstances, activities, practices, actions, omissions or plans that
could reasonably be expected to give rise to any material costs or
liabilities to the Company or any Subsidiary under, or to interfere with
or prevent compliance by the Company or any Subsidiary with, Environmental
Laws, except as would not, individually or in the aggregate, have a
Material Adverse Effect; to the Company's or any Subsidiaries' knowledge,
neither the Company nor any Subsidiary (i) is the subject of any
investigation, (ii) has received any notice or claim, (iii) is a party to
or affected by any pending or threatened action, suit or proceeding, (iv)
is bound by any judgment, decree or order, or (v) has entered into any
agreement, in each case relating to any alleged violation of any
Environmental Law or any actual or alleged release or threatened release
or cleanup at any location of any Hazardous Materials (as defined below)
(as used herein, "Environmental Law" means any federal, state, local or
foreign law, statute, ordinance, rule, regulation, order, decree,
judgment, injunction, permit, license, authorization or other binding
requirement, or common law, relating to health, safety or the protection,
cleanup or restoration of the environment or natural resources, including
those relating to the distribution, processing, generation, treatment,
storage, disposal, transportation, other handling or release or threatened
release of Hazardous Materials, and "Hazardous Materials" means any
material (including, without limitation, pollutants, contaminants,
hazardous or toxic substances or wastes including petroleum and any
petroleum products or byproducts) that is regulated by or may give rise to
liability under any Environmental Law);
(cc) from time to time, the Company and each of the Subsidiaries
conducts a review of the effect of the Environmental Laws on its business,
operations and properties, in a manner which is reasonable in light of the
Company's and each respective Subsidiary's business in order to identify
and evaluate associated costs and liabilities (including, without
limitation, any capital or operating expenditures required for cleanup,
closure of properties or compliance with Environmental Laws or any permit,
license or approval, any related constraints on operating activities and
any potential liabilities to third parties);
13
(dd) all tax returns required to be filed by the Company and each of
the Subsidiaries have been filed except where the failure to file could
not, individually or in the aggregate, have a Material Adverse Effect, and
all taxes and other assessments of a similar nature (whether imposed
directly or through withholding) including any interest, additions to tax
or penalties applicable thereto due or claimed to be due from such
entities have been paid, other than those being contested in good faith
and for which adequate reserves have been provided and other than any
failure to pay that could not, individually or in the aggregate, have a
Material Adverse Effect;
(ee) the Company and each of the Subsidiaries maintains insurance
covering its respective properties (including the vessels described in the
Prospectus and the Registration Statement), operations, personnel and
businesses as the Company and each respective Subsidiary deems adequate;
such insurance insures against such losses and risks (including
environmental damage and pollution coverage) to an extent which is
adequate in accordance with customary industry practice to protect the
Company, each of the Subsidiaries and their respective businesses; all
such insurance is fully in force on the date hereof and will be fully in
force at the time of purchase and any additional time of purchase; and
none of the Company or the Subsidiaries has received written notice from
any insurer or agent of such insurer that any material capital
improvements or other material expenditures are required or necessary to
be made in order to continue such insurance;
(ff) neither the Company nor any Subsidiary has sustained since the
date of the last audited financial statements included in the Registration
Statement and the Prospectus any 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 judicial or governmental action,
order or decree;
(gg) neither the Company nor any Subsidiary has sent or received any
communication regarding termination of, or intent not to renew, any of the
contracts or agreements referred to or described in, or filed as an
exhibit to, the Registration Statement, and no such termination or
non-renewal has been threatened by the Company or any Subsidiary or, to
the Company's or any Subsidiary's knowledge, any other party to any such
contract or agreement;
(hh) the Company maintains a system of internal accounting controls
sufficient to provide reasonable assurance that (i) transactions are
executed in accordance with management's general or specific
authorization; (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally accepted
accounting principles and to maintain accountability for assets; (iii)
access to assets is permitted only in accordance with management's general
or specific authorization; and (iv) the recorded accountability for assets
is compared with existing assets at reasonable intervals and appropriate
action is taken with respect to any differences;
14
(ii) the Company has established and maintains and evaluates
"disclosure controls and procedures" (as such term is defined in Rule
13a-15 and 15d-15 under the Exchange Act) and "internal control over
financial reporting" (as such term is defined in Rule 13a-15 and 15d-15
under the Exchange Act); such disclosure controls and procedures are
designed to ensure that material information relating to the Company and
its subsidiaries is made known to the Company's chief executive officer,
its principal financial officer and its principal accounting officer by
others within those entities, and such disclosure controls and procedures
are effective to perform the functions for which they were established;
the Company's auditors and the Audit Committee of the Board of Directors
of the Company have been advised of: (i) any significant deficiencies in
the design or operation of internal controls which could adversely affect
the Company's ability to record, process, summarize, and report financial
data; and (ii) any known fraud, whether or not material, that involves
management or other employees who have a role in the Company's internal
controls; any material weaknesses in internal controls have been
identified for the Company's auditors; since the date of the most recent
evaluation of such disclosure controls and procedures, there have been no
significant changes in internal controls or in other factors that could
significantly affect the Company's internal controls, including any
corrective actions with regard to significant deficiencies and material
weaknesses; and the Company is, and since July 30, 2002 has been, in
compliance with all applicable effective provisions of the Xxxxxxxx-Xxxxx
Act of 2002 (the "Xxxxxxxx-Xxxxx Act") and the rules and regulations of
the Commission and the New York Stock Exchange, Inc. promulgated
thereunder and is actively taking reasonable steps to ensure that it will
be in compliance with other applicable provisions of the Xxxxxxxx-Xxxxx
Act upon the effectiveness of such provisions;
(jj) the chief executive officer and the chief financial officer of
the Company have made all certifications required by the Xxxxxxxx-Xxxxx
Act and any related rules and regulations promulgated by the Commission,
and the statements contained in each such certification were true and
correct when made;
(kk) there are no business relationships or related party
transactions involving the Company or any of the Subsidiaries or any other
person required to be described in the Prospectus and the Registration
Statement which have not been described as required; the Company has
provided you true, correct and complete copies of all documentation
pertaining to any currently outstanding extension of credit in the form of
a personal loan made, directly or indirectly, by the Company to any
director or executive officer of the Company, or to any family member or
affiliate of any director or executive officer of the Company; and on or
after July 30, 2002, the Company has not, directly or indirectly, (i)
extended credit, arranged to extend credit, or renewed any extension of
credit, in the form of a personal loan, to or for any director or
executive officer of the Company, or to or for any family member or
affiliate of any director or executive officer of the Company; or (ii)
made any material modification, including any
15
renewal thereof, to any term of any personal loan to any director or
executive officer of the Company, or any family member or affiliate of any
director or executive officer, which was outstanding on July 30, 2002;
(ll) all statistical or market-related data included in the
Registration Statement or the Prospectus are based on or derived from
sources that the Company believes to be reliable and accurate, and the
Company has obtained the written consent to the use of such data from such
sources to the extent required;
(mm) neither the Company, nor any Subsidiary, nor, to the Company's
or any Subsidiary's knowledge, any employee or agent of the Company or any
Subsidiary has made any payment of funds of the Company or any Subsidiary
or received or retained any funds in violation of any law, rule or
regulation, which payment, receipt or retention of funds is of a character
required to be disclosed in the Registration Statement or the Prospectus;
(nn) except pursuant to this Agreement, the Company has not incurred
any liability for any finder's or broker's fee or agent's commission in
connection with the execution and delivery of this Agreement or the
consummation of the transactions contemplated hereby or by the
Registration Statement and the Prospectus;
(oo) neither the Company nor any of its directors, officers,
affiliates or controlling persons has taken, directly or indirectly, any
action designed, or which has constituted or might reasonably be expected
to cause or result in, under the Exchange Act or otherwise, the
stabilization or manipulation of the price of any security of the Company
to facilitate the sale or resale of the Shares;
(pp) to the Company's knowledge after due inquiry, there are no
affiliations or associations between any member of the NASD and any of the
Company's executive officers, directors or 5% or greater securityholders,
except as described in the NASD Questionnaire for Directors, Executive
Officers and Certain Beneficial Owners completed by each of the Company's
executive officers, directors and 5% securityholders and provided to the
Underwriter;
(qq) the Company is a citizen of the United States within the
meaning of Section 2 of the Shipping Act, 1916, as amended (the "Shipping
Act"), and is qualified to engage in the coastwise trade of the United
States; neither the compliance by the Company with the provisions of the
Transaction Documents nor the consummation of the transactions set forth
therein will cause the Company to cease to be a citizen of the United
States within the meaning of Section 2 of the Shipping Act or cause the
Company to cease to be qualified to engage in the coastwise trade of the
United States;
16
(rr) neither the Company nor any Subsidiary or any of their
respective affiliates does business with the government of Cuba or with
any person or affiliate located in Cuba within the meaning of Section
517.075, Florida Statutes;
(ss) neither the Company nor any Subsidiary nor, to the knowledge of
the Company or any Subsidiary, any director, officer, agent, employee or
affiliate of the Company or any of the Subsidiaries, has made any
contribution or other payment to any official of, or candidate for, any
federal, state or foreign office in violation of any law or of the
character required to be disclosed in the Prospectus and the Registration
Statement; neither the Company nor any Subsidiary nor, to the knowledge of
the Company or any Subsidiary, any director, officer, agent, employee or
affiliate of the Company or any Subsidiary is aware of or has taken any
action, directly or indirectly, that would result in a violation by such
persons of the Foreign Corrupt Practices Act of 1977, as amended, and the
rules and regulations thereunder (the "FCPA"), including, without
limitation, making use of the mails or any means or instrumentality of
interstate commerce corruptly in furtherance of an offer, payment, promise
to pay or authorization of the payment of any money, or other property,
gift, promise to give, or authorization of the giving of anything of value
to any "foreign official" (as such term is defined in the FCPA) or any
foreign political party or official thereof or any candidate for foreign
political office, in contravention of the FCPA and the Company, the
Subsidiaries and, to the knowledge of the Company or any Subsidiary, its
affiliates have conducted their businesses in compliance with the FCPA,
and have instituted and maintain policies and procedures designed to
ensure, and which are reasonably expected to continue to ensure, continued
compliance therewith;
(tt) except as described in the Prospectus and the Registration
Statement, no Subsidiary is prohibited, directly or indirectly, from
paying any dividends to the Company, from making any other distribution on
such Subsidiary's capital stock or other equity interests, from repaying
to the Company any loans or advances to such Subsidiary from the Company
or from transferring any of such Subsidiary's property or assets to the
Company or any other Subsidiary of the Company; except as described in the
Prospectus and the Registration Statement, the Company is not prohibited,
directly or indirectly, from paying any dividends to its stockholders; and
(uu) the statements in the Prospectus and the Registration Statement
under the headings "Business -- Regulation," "Business -- New Tax
Legislation," "Business -- Insurance," "Description of the Preferred
Stock," "Description of the Notes," "Description of Indebtedness,"
"Description of Common Stock," "Certain Relationships and Transactions,"
"Material U.S. Federal Income Tax Considerations," and "Underwriting," in
each case insofar as such statements summarize legal matters, agreements,
documents or proceedings discussed therein, are accurate and fair
summaries of such legal matters, agreements, documents or proceedings.
17
In addition, any certificate signed by any officer of the Company and
delivered to the Underwriter or counsel for the Underwriter in connection with
the offering of the Shares shall be deemed to be a representation and warranty
by the Company as to matters covered thereby, to the Underwriter.
4. Certain Covenants of the Company. The Company hereby agrees:
(a) to furnish such information as may be required and otherwise to
cooperate in qualifying the Shares for offering and sale under the
securities or blue sky laws of such states or other jurisdictions as you
may designate and to maintain such qualifications in effect so long as you
may request for the distribution of the Shares; provided, however, that
the Company shall not be required to qualify as a foreign corporation or
to consent to the service of process under the laws of any such
jurisdiction (except service of process with respect to the offering and
sale of the Shares); and to promptly advise you of the receipt by the
Company of any notification with respect to the suspension of the
qualification of the Shares for offer or sale in any jurisdiction or the
initiation or threatening of any proceeding for such purpose;
(b) to make available to the Underwriter in Baltimore, Maryland, as
soon as practicable after the Registration Statement becomes effective,
and thereafter from time to time to furnish to the Underwriter, as many
copies of the Prospectus (or of the Prospectus as amended or supplemented
if the Company shall have made any amendments or supplements thereto after
the effective date of the Registration Statement) as the Underwriter may
reasonably request for the purposes contemplated by the Act; in case the
Underwriter is required to deliver a prospectus after the nine-month
period referred to in Section 10(a)(3) of the Act in connection with the
sale of the Shares, the Company will prepare, at its expense, promptly
upon request, such amendment or amendments to the Registration Statement
and the Prospectus as may be necessary to permit compliance with the
requirements of Section 10(a)(3) of the Act;
(c) if, at the time this Agreement is executed and delivered, it is
necessary for the Registration Statement or any post-effective amendment
thereto to be declared effective before the Shares may be sold, the
Company will use its best efforts to cause the Registration Statement or
such post-effective amendment to become effective as soon as practicable,
and the Company will advise you promptly and, if requested by you, will
confirm such advice in writing, (i) when the Registration Statement and
any such post-effective amendment thereto has become effective, and (ii)
if Rule 430A under the Act is used, when the Prospectus is filed with the
Commission pursuant to Rule 424(b) under the Act (which the Company agrees
to file in a timely manner under such Rule);
(d) to advise you promptly, confirming such advice in writing, of
any request by the Commission for amendments or supplements to the
Registration Statement or the Exchange Act Registration Statement or the
Prospectus or for
18
additional information with respect thereto, or of notice of institution
of proceedings for, or the entry of, a stop order, suspending the
effectiveness of the Registration Statement and, if the Commission should
enter a stop order suspending the effectiveness of the Registration
Statement, to use its best efforts to obtain the lifting or removal of
such order as soon as practicable; to advise you promptly of any proposal
to amend or supplement the Registration Statement or the Exchange Act
Registration Statement or the Prospectus and to provide you and your
counsel copies of any such documents for review and comment a reasonable
amount of time prior to any proposed filing and to file no such amendment
or supplement to which you shall object in writing;
(e) to file promptly all reports and any definitive proxy or
information statement required to be filed by the Company with the
Commission in order to comply with 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 Shares; to provide
you with a copy of such reports and statements and other documents to be
filed by the Company pursuant to Section 13, 14 or 15(d) of the Exchange
Act during such period for your review and comment a reasonable amount of
time prior to any proposed filing, and to file no such report, statement
or document to which you shall object in writing; and to promptly notify
you of any such filing;
(f) if necessary or appropriate, to file a registration statement
pursuant to Rule 462(b) under the Act and pay the applicable fees in
accordance with the Act;
(g) to advise the Underwriter promptly of the happening of any event
within the time during which a prospectus relating to the Shares is
required to be delivered under the Act which could require the making of
any change in the Prospectus then being used so that the Prospectus would
not include an untrue statement of material fact or omit to state a
material fact necessary to make the statements therein, in the light of
the circumstances under which they are made, not misleading, and, during
such time, subject to Section 4(d) hereof, to prepare and furnish, at the
Company's expense, to the Underwriter promptly such amendments or
supplements to such Prospectus as may be necessary to reflect any such
change;
(h) to make generally available to its security holders, and to
deliver to you, an earnings statement of the Company (which will satisfy
the provisions of Section 11(a) of the Act) covering a period of twelve
months beginning after the effective date of the Registration Statement
(as defined in Rule 158(c) under the Act) as soon as is reasonably
practicable after the termination of such twelve-month period but in any
case not later than, March 1, 2006;
(i) to furnish to its stockholders as soon as practicable after the
end of each fiscal year an annual report (including a consolidated balance
sheet and
19
statements of income, stockholders' equity and cash flow of the Company
for such fiscal year, accompanied by a copy of the certificate or report
thereon of nationally recognized independent certified public accountants
duly registered with the PCAOB);
(j) to furnish to you five (5) copies of the Registration Statement,
as initially filed with the Commission, and of all amendments thereto
(including all exhibits thereto);
(k) to furnish to you promptly for a period of five years from the
date of this Agreement (i) at the same time as distributed to the
Company's stockholders after the end of each fiscal year, copies of the
annual report of the Company containing the balance sheet of the Company
as of the close of such fiscal year and statements of income, changes in
stockholders' investment and cash flows for the year then ended and the
opinion thereon of the Company's independent public or certified public
accountants; (ii) at the same time as distributed to the Company's
stockholders copies of any reports, proxy statements, or other
communications which the Company shall send to its stockholders or shall
from time to time publish or publicly disseminate, (iii) at the same time
as filed with any national securities exchange, copies of documents or
reports filed with any national securities exchange on which any class of
securities of the Company is listed, and (iv) such other information as
you may reasonably request regarding the Company;
(l) to furnish to you as early as practicable prior to the time of
purchase and any additional time of purchase, as the case may be, but not
later than two business days prior thereto, a copy of the latest available
unaudited interim and monthly financial statements, if any, of the Company
which have been read by the Company's independent certified public
accountants, as stated in their letter to be furnished pursuant to Section
6(d) hereof;
(m) to apply the net proceeds from the sale of the Shares in the
manner set forth under the caption "Use of Proceeds" in the Prospectus;
(n) to pay all costs, expenses, fees and taxes in connection with
(i) the preparation and filing of the Registration Statement, each
Preliminary Prospectus, the Prospectus and any amendments or supplements
thereto, and the printing and furnishing of copies of each thereof to the
Underwriter and to dealers (including costs of mailing and shipment), (ii)
the registration, issue, sale and delivery of the Shares including any
stock or transfer taxes and stamp or similar duties payable upon the sale,
issuance or delivery of the Shares to the Underwriter, (iii) the
producing, word processing and/or printing of this Agreement, any dealer
agreements, any Powers of Attorney and any closing documents (including
compilations thereof) and the reproduction and/or printing and furnishing
of copies of each thereof to the Underwriter and (except closing
documents) to dealers (including costs of mailing and shipment), (iv) the
qualification of the
20
Shares for offering and sale under state or foreign laws and the
determination of their eligibility for investment under state or foreign
laws as aforesaid (including the reasonable legal fees and filing fees and
other disbursements of counsel for the Underwriter related to such
qualification and determination) and the printing and furnishing of copies
of any blue sky surveys or legal investment surveys to the Underwriter and
to dealers, (v) listing of the Shares on the New York Stock Exchange, Inc.
and any registration thereof under the Exchange Act, (vi) any filing for
review of the public offering of the Shares by the NASD, including the
reasonable legal fees and filing fees and other disbursements of counsel
to the Underwriter related to such filing, (vii) the fees and
disbursements of any transfer agent or registrar for the Shares, (viii)
the costs and expenses of the Company relating to presentations or
meetings undertaken in connection with the marketing of the offering and
sale of the Shares to prospective investors and the Underwriter's sales
forces, 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,
travel, lodging and other expenses incurred by the officers of the Company
and any such consultants in connection with the road show, (ix) the
preparation and filing of the Exchange Act Registration Statement,
including any amendments thereto, and (x) the performance of the Company's
other obligations hereunder;
(o) not to sell, offer to sell, contract or agree to sell,
hypothecate, pledge, grant any option to purchase or otherwise dispose of
or agree to dispose of, directly or indirectly, any Common Stock or
securities convertible into or exchangeable or exercisable for Common
Stock or warrants or other rights to purchase Common Stock or any other
securities of the Company that are substantially similar to Common Stock,
or file or cause to be declared effective a registration statement under
the Act relating to the offer and sale of any shares of Common Stock or
securities convertible into or exercisable or exchangeable for Common
Stock or warrants or other rights to purchase Common Stock or any other
securities of the Company that are substantially similar to Common Stock
for a period of 60 days after the date hereof (the "Lock-Up Period"),
without the prior written consent of the Underwriter, except for (i) the
registration of the Shares and the sales to the Underwriter pursuant to
this Agreement, (ii) issuances of Common Stock upon the exercise of
options or warrants disclosed as outstanding in the Registration Statement
and the Prospectus, (iii) the issuance of employee stock options not
exercisable during the Lock-Up Period pursuant to stock option plans
described in the Registration Statement and the Prospectus and (iv) the
issuance of Common Stock upon conversion of the Shares in compliance with
the Certificate of Designations;
(p) prior to the time of purchase or the additional time of
purchase, as the case may be, to issue no press release or other
communication directly or indirectly and hold no press conferences with
respect to the Company, the financial condition, results of operations,
business, properties, assets, or liabilities of the Company, or the
offering of the Shares, without your prior consent;
21
(q) to use its best efforts to cause the Shares and the Conversion
Shares, if any, to be listed for quotation on the New York Stock Exchange,
Inc. and to maintain the listing of the Shares and the Common Stock
(including the Conversion Shares) on the New York Stock Exchange, Inc.;
(r) to maintain a transfer agent and, if necessary under the
jurisdiction of incorporation of the Company, a registrar for the Shares;
and
(s) to cause the Notes, if issued, to be listed for quotation on one
of the following markets: New York Stock Exchange, Inc., National
Association of Securities Dealers Automated Quotation National Market
System ("NASDAQ"), American Stock Exchange or another similar securities
exchange or securities trading market and to use its best efforts to
maintain such listing.
5. Reimbursement of Underwriter's Expenses. If the Shares are not
delivered for any reason other than the default by the Underwriter in its
obligations hereunder, the Company shall, in addition to paying the amounts
described in Section 4(n) hereof, reimburse the Underwriter for its
out-of-pocket expenses reasonably incurred in connection with this Agreement and
the offering contemplated hereby, including the fees and disbursements of its
counsel.
6. Conditions of Underwriter's Obligations. The obligations of the
Underwriter hereunder are subject to the accuracy of the representations and
warranties on the part of the Company on the date hereof, at the time of
purchase and, if applicable, at the additional time of purchase, the performance
by the Company of its obligations hereunder and to the following additional
conditions precedent:
(a) The Company shall furnish to you at the time of purchase and, if
applicable, at the additional time of purchase, an opinion of Jones,
Walker, Waechter, Poitevent, Carrere & Xxxxxxx, L.L.P., counsel for the
Company, addressed to the Underwriter, and dated the time of purchase or
the additional time of purchase, as the case may be, in form and substance
reasonably satisfactory to Xxxxxxx LLP, counsel for the Underwriter, in
the form set forth in Exhibit B hereto.
(b) You shall have received from Ernst & Young LLP letters dated,
respectively, the date of this Agreement, the time of purchase and, if
applicable, the additional time of purchase, and addressed to the
Underwriter in the forms heretofore approved by the Underwriter.
(c) You shall have received at the time of purchase and, if
applicable, at the additional time of purchase, the favorable opinion of
Xxxxxxx LLP, counsel for the Underwriter, dated the time of purchase or
the additional time of purchase, as the case may be, in form and substance
reasonably satisfactory to the Underwriter.
22
(d) No Prospectus or amendment or supplement to the Registration
Statement or the Prospectus shall have been filed to which you object in
writing.
(e) The Registration Statement and the Exchange Act Registration
Statement shall become effective not later than 5:30 P.M., New York City
time, on the date of this Agreement and, if Rule 430A under the Act is
used, the Prospectus shall have been filed with the Commission pursuant to
Rule 424(b) under the Act at or before 5:30 P.M., New York City time, on
the second full business day after the date of this Agreement, and any
registration statement pursuant to Rule 462(b) under the Act required in
connection with the offering and sale of the Shares shall have been filed
and become effective no later than 10:00 P.M., New York City time, on the
date of this Agreement.
(f) Prior to the time of purchase, and, if applicable, the
additional time of purchase, (i) no stop order with respect to the
effectiveness of the Registration Statement shall have been issued under
the Act or proceedings initiated under Section 8(d) or 8(e) of the Act;
(ii) the Registration Statement and all amendments thereto shall not
contain an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they are made, not
misleading; and (iii) the Prospectus and all amendments or supplements
thereto shall not contain an untrue statement of a material fact or omit
to state a material fact required to be stated therein or necessary to
make the statements therein, in the light of the circumstances under which
they are made, not misleading.
(g) Between the time of execution of this Agreement and the time of
purchase or the additional time of purchase, as the case may be, (A) no
Material Adverse Effect or any development involving a prospective
Material Adverse Effect shall occur or become known, (B) no change in the
capital stock or long-term debt of the Company or any Subsidiary (other
than as contemplated by this Agreement) shall occur or become known and
(C) no transaction which is material to the Company and the Subsidiaries,
taken as a whole, shall have been entered into by the Company or any
Subsidiary.
(h) The Company will, at the time of purchase and, if applicable, at
the additional time of purchase, deliver to you a certificate of its chief
executive officer and its chief financial officer, dated the time of
purchase or additional time of purchase, as the case may be, in the form
attached as Exhibit C hereto.
(i) You shall have received signed Lock-up Agreements referred to in
Section 3(w) hereof.
(j) The Company shall have furnished to you such other documents and
certificates as to the accuracy and completeness of any statement in the
23
Registration Statement and the Prospectus as of the time of purchase and,
if applicable, the additional time of purchase, as you may reasonably
request.
(k) The Shares shall have been approved for listing on the New York
Stock Exchange, Inc., subject only to notice of issuance at or prior to
the time of purchase or the additional time of purchase, as the case may
be.
(l) The Company and the Trustee shall have executed and delivered
the Indenture.
7. Effective Date of Agreement; Termination. This Agreement shall become
effective (i) if Rule 430A under the Act is not used, when you shall have
received notification of the effectiveness of the Registration Statement, or
(ii) if Rule 430A under the Act is used, when the parties hereto have executed
and delivered this Agreement.
The obligations of the Underwriter hereunder shall be subject to
termination in the absolute discretion of the Underwriter if (x) since the time
of execution of this Agreement or the earlier respective dates as of which
information is given in the Registration Statement and the Prospectus, there has
been any material adverse change or any development involving a prospective
material adverse change in the business, properties, management, condition
(financial or otherwise), results of operations or prospects of the Company and
the Subsidiaries, taken as a whole, which would, in the Underwriter's judgment
make it impracticable or inadvisable to proceed with the public offering or the
delivery of the Shares on the terms and in the manner contemplated in the
Registration Statement and the Prospectus, or (y) since the time of execution of
this Agreement, there shall have occurred: (i) a suspension or material
limitation in trading in securities generally on the New York Stock Exchange,
the American Stock Exchange or the NASDAQ; (ii) a suspension or material
limitation in trading in the Company's securities on the New York Stock
Exchange, Inc.; (iii) a general moratorium on commercial banking activities
declared by either federal, New York State or Louisiana State authorities or a
material disruption in commercial banking or securities settlement or clearance
services in the United States; (iv) an outbreak or escalation of hostilities or
acts of terrorism involving the United States or a declaration by the United
States of a national emergency or war; or (v) any other calamity or crisis or
any change in financial, political or economic conditions in the United States
or elsewhere, if the effect of any such event specified in clause (iv) or (v) in
the Underwriter's judgment makes it impracticable or inadvisable to proceed with
the public offering or the delivery of the Shares on the terms and in the manner
contemplated in the Registration Statement and the Prospectus, or (z) since the
time of execution of this Agreement, there shall have occurred any downgrading,
or any notice or announcement shall have been given or made of (i) any intended
or potential downgrading, or (ii) any watch, review or possible change that does
not indicate an affirmation or improvement in the rating accorded any securities
of or guaranteed by the Company by any "nationally recognized statistical rating
organization," as that term is defined in Rule 436(g)(2) under the Act.
24
If the Underwriter elects to terminate this Agreement as provided in
this Section 7, the Company shall be notified promptly in writing.
If the sale to the Underwriter of the Shares, as contemplated by
this Agreement, is not carried out by the Underwriter for any reason permitted
under this Agreement, or if such sale is not carried out because the Company
shall be unable to comply with any of the terms of this Agreement, the Company
shall not be under any obligation or liability under this Agreement (except to
the extent provided in Sections 4(n), 5 and 9 hereof), and the Underwriter shall
be under no obligation or liability to the Company under this Agreement (except
to the extent provided in Section 9 hereof) hereunder).
8. Reserved.
9. Indemnity and Contribution.
(a) Subject to the provisions of subsection (c) below, the Company
agrees to indemnify, defend and hold harmless the Underwriter, its
partners, directors and officers, and any person who controls the
Underwriter within the meaning of Section 15 of the Act or Section 20 of
the Exchange Act, and the successors and assigns of all of the foregoing
persons, from and against any loss, damage, expense, liability or claim
(including the reasonable cost of investigation) which, jointly or
severally, the Underwriter or any such person may incur under the Act, the
Exchange Act, the common law or otherwise, insofar as such loss, damage,
expense, liability or claim arises out of or is based upon (i) any untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement (or in the Registration Statement as amended by any
post-effective amendment thereof by the Company), or arises out of or is
based upon any omission or alleged omission to state a material fact
required to be stated in such Registration Statement or necessary to make
the statements made therein not misleading, except insofar as any such
loss, damage, expense, liability or claim arises out of or is based upon
any untrue statement or alleged untrue statement of a material fact
contained in, and in conformity with information concerning the
Underwriter furnished in writing by or on behalf of the Underwriter
through you to the Company expressly for use in, such Registration
Statement or arises out of or is based upon any omission or alleged
omission to state a material fact in connection with such information
required to be stated in such Registration Statement or necessary to make
such information not misleading, (ii) any untrue statement or alleged
untrue statement of a material fact contained in a Prospectus (the term
Prospectus for the purpose of this Section 9 being deemed to include any
Preliminary Prospectus, the Prospectus and the Prospectus as amended or
supplemented by the Company), or arises out of or is based upon any
omission or alleged omission to state a material fact required to be
stated in such Prospectus or necessary to make the statements made
therein, in light of the circumstances under which they were made, not
misleading, except insofar as any such loss, damage, expense, liability or
claim arises out of or is based upon any untrue
25
statement or alleged untrue statement of a material fact contained in, and
in conformity with information concerning the Underwriter furnished in
writing by or on behalf of the Underwriter to the Company expressly for
use in, such Prospectus or arises out of or is based upon any omission or
alleged omission to state a material fact in connection with such
information required to be stated in such Prospectus or necessary to make
such information, in light of the circumstances under which it was
presented, not misleading, (iii) any untrue statement or alleged untrue
statement made by the Company in Section 3 hereof or the failure by the
Company to perform when and as required any agreement or covenant
contained herein, or (iv) any untrue statement or alleged untrue statement
of any material fact contained in any audio or visual materials provided
by the Company or based upon written information furnished by or on behalf
of the Company including, without limitation, slides, videos, films or
tape recordings used in connection with the marketing of the Shares.
If any action, suit or proceeding (each, a "Proceeding") is brought
against the Underwriter or any such person in respect of which indemnity
may be sought against the Company pursuant to the foregoing paragraph, the
Underwriter or such person shall promptly notify the Company in writing of
the institution of such Proceeding and the Company shall assume the
defense of such Proceeding, including the employment of counsel reasonably
satisfactory to such indemnified party and payment of all fees and
expenses; provided, however, that the omission to so notify the Company
shall not relieve the Company from any liability which the Company may
have to the Underwriter or any such person or otherwise, except to the
extent that the Company has been materially prejudiced (through the
forfeiture of substantive rights or defenses or otherwise) by such
omission. The Underwriter or such person shall have the right to employ
its or their own counsel in any such case, but the fees and expenses of
such counsel shall be at the expense of the Underwriter or of such person
unless the employment of such counsel shall have been authorized in
writing by the Company in connection with the defense of such Proceeding
or the Company shall not have, within a reasonable period of time in light
of the circumstances, employed counsel reasonably satisfactory to such
indemnified party to defend such Proceeding or such indemnified party or
parties shall have reasonably concluded that there may be defenses
available to it or them which are different from, additional to or in
conflict with those available to the Company (in which case the Company
shall not have the right to direct the defense of such Proceeding on
behalf of the indemnified party or parties, but the Company may, without
limiting the generality of the foregoing, employ counsel and participate
in the defense thereof, provided the fees and expenses of such counsel
shall be at the expense of the Company), in any of which events such fees
and expenses shall be borne by the Company and paid as incurred (it being
understood, however, that the Company shall not be liable for the expenses
of more than one separate counsel (in addition to any local counsel) in
any one Proceeding or series of related Proceedings in the same
jurisdiction representing the indemnified parties who are parties to such
Proceeding). The Company shall not be liable for any settlement of any
Proceeding effected without its written
26
consent but, if settled with the written consent of the Company, the
Company agrees to indemnify and hold harmless the Underwriter and any such
person from and against any loss or liability by reason of such
settlement. Notwithstanding the foregoing sentence, if at any time an
indemnified party shall have requested an indemnifying party to reimburse
the indemnified party for fees and expenses of counsel as contemplated by
this subsection, then the indemnifying party agrees that it shall be
liable for any settlement of any Proceeding effected without its written
consent if (i) such settlement is entered into more than 60 business days
after receipt by such indemnifying party of the aforesaid request, (ii)
such indemnifying party shall not have fully reimbursed the indemnified
party in accordance with such request prior to the date of such settlement
and (iii) such indemnified party shall have given the indemnifying party
at least 30 days' prior notice of its intention to settle. No indemnifying
party shall, without the prior written consent of the indemnified party,
effect any settlement of any pending or threatened Proceeding in respect
of which any indemnified party is or could have been a party and indemnity
could have been sought hereunder by such indemnified party, unless such
settlement includes an unconditional release of such indemnified party
from all liability on claims that are the subject matter of such
Proceeding and does not include an admission of fault, culpability or a
failure to act, by or on behalf of such indemnified party.
(b) The Underwriter agrees to indemnify, defend and hold harmless
the Company, its directors and officers, and any person who controls the
Company within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act, and the successors and assigns of all of the foregoing
persons, from and against any loss, damage, expense, liability or claim
(including the reasonable cost of investigation) which, jointly or
severally, the Company or any such person may incur under the Act, the
Exchange Act, the common law or otherwise, insofar as such loss, damage,
expense, liability or claim arises out of or is based upon any untrue
statement or alleged untrue statement of a material fact contained in, and
in conformity with information concerning the Underwriter furnished in
writing by or on behalf of the Underwriter to the Company expressly for
use in, the Registration Statement (or in the Registration Statement as
amended by any post-effective amendment thereof by the Company) or in a
Prospectus, or arises out of or is based upon any omission or alleged
omission to state a material fact in connection with such information
required to be stated in such Registration Statement or such Prospectus or
necessary to make such information, in light of the circumstances under
which it was presented, not misleading.
If any Proceeding is brought against the Company or any such person
in respect of which indemnity may be sought against the Underwriter
pursuant to the foregoing paragraph, the Company or such person shall
promptly notify the Underwriter in writing of the institution of such
Proceeding and the Underwriter shall assume the defense of such
Proceeding, including the employment of counsel reasonably satisfactory to
such indemnified party and payment of all fees
27
and expenses; provided, however, that the omission to so notify the
Underwriter shall not relieve the Underwriter from any liability which the
Underwriter may have to the Company or any such person or otherwise,
except to the extent that the Underwriter has been materially prejudiced
(through the forfeiture of substantive rights or defenses or otherwise) by
such omission. The Company or such person shall have the right to employ
its own counsel in any such case, but the fees and expenses of such
counsel shall be at the expense of the Company or such person unless the
employment of such counsel shall have been authorized in writing by the
Underwriter in connection with the defense of such Proceeding or the
Underwriter shall not have, within a reasonable period of time in light of
the circumstances, employed counsel reasonably satisfactory to such
indemnified party to defend such Proceeding or such indemnified party or
parties shall have reasonably concluded that there may be defenses
available to it or them which are different from or additional to or in
conflict with those available to the Underwriter (in which case the
Underwriter shall not have the right to direct the defense of such
Proceeding on behalf of the indemnified party or parties, but the
Underwriter may employ counsel and participate in the defense thereof but
the fees and expenses of such counsel shall be at the expense of the
Underwriter), in any of which events such fees and expenses shall be borne
by the Underwriter and paid as incurred (it being understood, however,
that the Underwriter shall not be liable for the expenses of more than one
separate counsel (in addition to any local counsel) in any one Proceeding
or series of related Proceedings in the same jurisdiction representing the
indemnified parties who are parties to such Proceeding). The Underwriter
shall not be liable for any settlement of any such Proceeding effected
without the written consent of the Underwriter but, if settled with the
written consent of the Underwriter, the Underwriter agrees to indemnify
and hold harmless the Company and any such person from and against any
loss or liability by reason of such settlement. Notwithstanding the
foregoing sentence, if at any time an indemnified party shall have
requested an indemnifying party to reimburse the indemnified party for
fees and expenses of counsel as contemplated by this subsection, then the
indemnifying party agrees that it shall be liable for any settlement of
any Proceeding effected without its written consent if (i) such settlement
is entered into more than 60 business days after receipt by such
indemnifying party of the aforesaid request, (ii) such indemnifying party
shall not have fully reimbursed the indemnified party in accordance with
such request prior to the date of such settlement, and (iii) such
indemnified party shall have given the indemnifying party at least 30
days' prior notice of its intention to settle. No indemnifying party
shall, without the prior written consent of the indemnified party, effect
any settlement of any pending or threatened Proceeding in respect of which
any indemnified party is or could have been a party and indemnity could
have been sought hereunder by such indemnified party, unless such
settlement includes an unconditional release of such indemnified party
from all liability on claims that are the subject matter of such
Proceeding and such settlement does not include an admission of fault or
culpability, or a failure to act, by or on behalf of such indemnified
party.
28
(c) If the indemnification provided for in this Section 9 is
unavailable to an indemnified party under subsection (a) or (b), as the
case may be, of this Section 9 or insufficient to hold an indemnified
party harmless in respect of any losses, damages, expenses, liabilities or
claims referred to therein, then each applicable indemnifying party shall
contribute to the amount paid or payable by such indemnified party as a
result of such losses, damages, expenses, liabilities or claims (i) in
such proportion as is appropriate to reflect the relative benefits
received by the Company on the one hand and the Underwriter on the other
hand from the offering of the Shares, or (ii) if the allocation provided
by clause (i) above is not permitted by applicable law, in such proportion
as is appropriate to reflect not only the relative benefits referred to in
clause (i) above but also the relative fault of the Company on the one
hand and of the Underwriter on the other in connection with the statements
or omissions which resulted in such losses, damages, expenses, liabilities
or claims, as well as any other relevant equitable considerations. The
relative benefits received by the Company on the one hand and the
Underwriter on the other shall be deemed to be in the same respective
proportions as the total proceeds from the offering (net of underwriting
discounts but before deducting expenses) received by the Company, and the
total underwriting discounts received by the Underwriter, bear to the
aggregate public offering price of the Shares. The relative fault of the
Company on the one hand and of the Underwriter on the other shall be
determined by reference to, among other things, whether the untrue
statement or alleged untrue statement of a material fact or omission or
alleged omission relates to information supplied by the Company or by the
Underwriter and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or
omission. The amount paid or payable by a party as a result of the losses,
damages, expenses, liabilities and claims referred to in this subsection
shall be deemed to include any legal or other fees or expenses reasonably
incurred by such party in connection with investigating, preparing to
defend or defending any Proceeding.
(d) The Company and the Underwriter agree that it would not be just
and equitable if contribution pursuant to this Section 9 were determined
by pro rata allocation or by any other method of allocation that does not
take account of the equitable considerations referred to in subsection (c)
above. Notwithstanding the provisions of this Section 9, the Underwriter
shall not be required to contribute any amount in excess of the amount by
which the total underwriting discounts received by the Underwriter with
respect to the offering of the Shares exceeds the amount of any damage
which the Underwriter has otherwise been required to pay by reason of such
untrue statement or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Act) shall be entitled to contribution
from any person who was not guilty of such fraudulent misrepresentation.
(e) The indemnity and contribution agreements contained in this
Section 9 and the covenants, warranties and representations of the Company
29
contained in this Agreement shall remain in full force and effect
regardless of any investigation made by or on behalf of the Underwriter,
its partners, directors or officers or any person (including each partner,
officer or director of such person) who controls the Underwriter within
the meaning of Section 15 of the Act or Section 20 of the Exchange Act, or
by or on behalf of the Company, its directors or officers or any person
who controls the Company within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act, and shall survive any termination of this
Agreement or the issuance and delivery of the Shares. The Company and the
Underwriter agree promptly to notify each other of the commencement of any
Proceeding against it and, in the case of the Company, against any of the
Company's officers or directors in connection with the issuance and sale
of the Shares, or in connection with the Registration Statement or the
Prospectus.
(f) The remedies provided for in this Section 9 are not exclusive
and shall not limit any rights or remedies that may otherwise be available
to any indemnified person hereunder at law or in equity.
10. Information Furnished by the Underwriter. The statements set forth in
"Underwriting Discount and Financial Advisory Fee" under the caption
"Underwriting" in the Prospectus, only insofar as such statements relate to the
amount of selling concession and reallowance that may be undertaken by the
Underwriter, constitute the only information furnished by or on behalf of the
Underwriter as such information is referred to in Sections 3 and 9 hereof.
11. Notices. Except as otherwise herein provided, all statements,
requests, notices and agreements shall be in writing or by facsimile and, if to
the Underwriter, shall be sufficient in all respects if delivered or sent to
Xxxxxx, Xxxxx Xxxxx, Incorporated, 000 Xxxxx Xxxxxx, Xxxxxxxxx, XX 00000,
Attention: Xxxxx XxXxxxx, Senior Vice President (facsimile number: (410)
659-4632,with a copy (which shall not constitute notice) to Xxxxxxx LLP, 0
Xxxxxxx Xxxxx, Xxxxx 0000, Xxxxxxxxx, XX, 00000-0000 Attention: Xxxxxx X.
Xxxxxxxxx, Xx. (facsimile number: (000) 000-0000), and, if to the Company, shall
be sufficient in all respects if delivered or sent to the Company at the offices
of the Company at 000 Xxxxxxx Xxxxxx, Xxx Xxxxxxx, Xxxxxxxxx 00000, Attention:
Xxxx X. Xxxxxxxx, Vice President and Chief Financial Officer (facsimile number:
(000) 000-0000, with a copy (which shall not constitute notice) to Jones,
Walker, Waechter, Poitevent, Carrere & Xxxxxxx, L.L.P., 000 Xx. Xxxxxxx Xxxxxx,
00xx Xxxxx, Xxx Xxxxxxx, Xxxxxxxxx 00000-0000 Attention: X. Xxxxxxxx XxXxxxxx,
II (facsimile number: (000) 000-0000).
12. Governing Law; Construction. This Agreement and any claim,
counterclaim or dispute of any kind or nature whatsoever arising out of or in
any way relating to this Agreement ("Claim"), directly or indirectly, shall be
governed by, and construed in accordance with, the laws of the State of Maryland
without regard to the conflict of law principles thereof. The section headings
in this Agreement have been inserted as a matter of convenience of reference and
are not a part of this Agreement.
30
13. Submission to Jurisdiction. Except as set forth below, no Claim may be
commenced, prosecuted or continued in any court other than the courts of the
State of Maryland located in the City of Baltimore or in the United States
District Court for the District of Maryland, which courts shall have
jurisdiction over the adjudication of such matters, and the Company consents to
the jurisdiction of such courts and personal service with respect thereto. The
Company hereby consents to personal jurisdiction, service and venue in any court
in which any Claim arising out of or in any way relating to this Agreement is
brought by any third party against the Underwriter or any indemnified party.
Each of the Underwriter and the Company (on its behalf and, to the extent
permitted by applicable law, on behalf of its stockholders and affiliates)
waives all right to trial by jury in any action, proceeding or counterclaim
(whether based upon contract, tort or otherwise) in any way arising out of or
relating to this Agreement. The Company agrees that a final judgment in any such
action, proceeding or counterclaim brought in any such court shall be conclusive
and binding upon the Company and may be enforced in any other courts to the
jurisdiction of which the Company is or may be subject, by suit upon such
judgment.
14. Parties at Interest. The Agreement herein set forth has been and is
made solely for the benefit of the Underwriter and the Company and to the extent
provided in Section 9 hereof the controlling persons, partners, directors and
officers referred to in such Section, and their respective successors, assigns,
heirs, personal representatives and executors and administrators. No other
person, partnership, association or corporation (including a purchaser, as such
purchaser, from the Underwriter) shall acquire or have any right under or by
virtue of this Agreement.
15. Counterparts. This Agreement may be signed by the parties in one or
more counterparts which together shall constitute one and the same agreement
among the parties.
16. Successors and Assigns. This Agreement shall be binding upon the
Underwriter and the Company and their successors and assigns and any successor
or assign of any substantial portion of the Company's and the Underwriter's
respective businesses and/or assets.
[THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK; SIGNATURE PAGE FOLLOWS]
31
If the foregoing correctly sets forth the understanding between the
Company and the Underwriter, please so indicate in the space provided below for
that purpose, whereupon this agreement and your acceptance shall constitute a
binding agreement between the Company and the Underwriter.
Very truly yours,
INTERNATIONAL SHIPHOLDING CORPORATION
By: /s/ Xxxx X. Xxxxxxx
---------------------------------
Name: Xxxx X. Xxxxxxx
Title: Chairman of the Board and Chief
Executive Officer
XXXXXX, XXXXX XXXXX, INCORPORATED
By: /s/ R. Xxxx Xxxx
---------------------------------
Name: R. Xxxx Xxxx
Title: Vice President
32
EXHIBIT A
Lock-Up Agreement
December____, 2004
Xxxxxx, Xxxxx Xxxxx, Incorporated
000 Xxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Re: Proposed Public Offering of International Shipholding Corporation
Ladies and Gentlemen:
The undersigned understands that Xxxxxx, Xxxxx Xxxxx, Incorporated (the
"Underwriter") proposes to enter into an Underwriting Agreement (the
"Underwriting Agreement") with International Shipholding Corporation (the
"Company") providing for a public offering (the "Offering") by the Underwriter
of securities of the Company, which may consist of common stock, convertible
preferred stock, convertible debt securities or other securities of the Company
(the "Securities"), pursuant to the Company's registration statement on Form S-1
(File No. 333-120161) as filed with the U.S. Securities and Exchange Commission
(the "Registration Statement").
In consideration of the Underwriter's agreement to purchase and make
the Offering of the Securities, and for other good and valuable consideration,
the receipt of which is hereby acknowledged, the undersigned hereby agrees that
without the prior written consent of the Underwriter (which consent may be
withheld in the Underwriter's sole discretion), the undersigned will not, during
the period commencing on the date of this letter and ending 60 days after the
date of the final prospectus relating to the Offering, directly or indirectly:
(1) offer, sell, contract to sell, pledge, sell any option or contract to
purchase, purchase any option or contract to sell, grant any option, right or
warrant to purchase, lend, or otherwise transfer or dispose of any shares of the
Company's common stock (the "Common Stock"), or any securities convertible into
or exercisable or exchangeable for the Common Stock; (2) enter into any swap or
other arrangement that transfers to another, in whole or in part, any of the
economic consequences of ownership of the Common Stock, or any securities
convertible into or exchangeable for the Common Stock, regardless of whether any
such transaction described herein is to be settled by delivery of the Common
Stock or such other securities, or by delivery of cash or otherwise; (3) make
any demand for, or exercise any right with respect to, the registration of any
shares of the Common Stock or any security convertible into or exercisable or
exchangeable for the Common Stock; or (4) publicly announce any intention to do
any of the foregoing. The foregoing sentence shall not apply to (a) the sale of
any Common Stock to the Underwriter pursuant to the
A-1
Underwriting Agreement, (b) bona fide gifts, provided the recipient or
recipients thereof agree in writing to be bound by the terms of this Lock-Up
Agreement, or (c) dispositions to any trust for the direct or indirect benefit
of the undersigned and/or the immediate family of the undersigned, provided that
such trust agrees in writing to be bound by the terms of this Lock-Up Agreement.
For purposes of this paragraph, "immediate family" shall mean the undersigned
and the spouse, any lineal descendant, father, mother, brother or sister of the
undersigned and father, mother, brother or sister of the undersigned's spouse.
The undersigned hereby agrees and consents to the entry of stop transfer
instructions with the Company's transfer agent against the transfer of
securities of the Company held by the undersigned except in compliance with this
Lock-Up Agreement.
The undersigned recognizes that the Offering will benefit the undersigned
and the Company. The undersigned acknowledges that the Underwriter is relying on
the representations and agreements of the undersigned contained in this Lock-Up
Agreement in carrying out the Offering and in entering into the Underwriting
Agreement.
The undersigned hereby represents and warrants that the undersigned has
full power and authority to enter into this Lock-Up Agreement. This Lock-Up
Agreement is irrevocable and all authority herein conferred or agreed to be
conferred shall survive the death or incapacity of the undersigned and any
obligations of the undersigned shall be binding upon the heirs, personal
representatives, successors and assigns of the undersigned.
This Lock-Up Agreement shall be terminated and the undersigned shall
be released from the undersigned's obligations hereunder (i) upon the date the
Company notifies you in writing that it does not intend to proceed with the
Offering, (ii) upon the date the registration statement filed with the
Securities and Exchange Commission with respect to the Offering is withdrawn,
(iii) upon the date the Underwriting Agreement is terminated, for any reason,
prior to the time of purchase (as defined in the Underwriting Agreement), or
(iv) if the Underwriting Agreement does not become effective by [ ], 2005.
Very truly yours,
___________________________________
___________________________________
Printed Name of Securityholder:
___________________________________
Capacity
(Indicate capacity of person signing if
signing as custodian or trustee or on
behalf of an entity)
A-2
Address:_________________________
_________________________
_________________________
Accepted as of the date first set forth above:
XXXXXX, XXXXX XXXXX, INCORPORATED
By:___________________________
Name:
Title:
A-3
EXHIBIT B
OPINION OF JONES, WALKER, WAECHTER, POITEVENT, CARRERE &
XXXXXXX, L.L.P.
1. Each of the Company and the significant subsidiaries of the Company, as
defined by Rule 1-02 of Regulation S-X (each a "Subsidiary" and collectively,
the "Subsidiaries") is validly existing and in good standing under the laws of
its respective jurisdiction of organization with full power and authority to
own, lease and operate its properties and conduct its business as described in
the Registration Statement and the Prospectus. The Company has full corporate
power and authority to execute and deliver the Agreement and to issue, sell and
deliver the Shares as contemplated therein, to execute, issue and deliver the
Indenture and the Notes and perform its obligations thereunder, and to issue and
deliver the Conversion Shares in accordance with the terms of the Certificate of
Designations or the Indenture, as the case may be.
2. Each of the Company and the Subsidiaries is duly qualified to do
business as a foreign entity and is in good standing in each jurisdiction where
the ownership or leasing of its properties or the conduct of its business
requires such qualification, except where the failure to be so qualified and in
good standing would not, individually or in the aggregate, have a Material
Adverse Effect.
3. The Agreement has been duly authorized by all necessary corporate
action on the part of the Company and has been duly executed and delivered by
the Company and is a valid and binding obligation of the Company, enforceable
against the Company in accordance with its terms, except as rights to
indemnification and contribution may be limited by applicable law and except as
the enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to or affecting
enforcement of the rights and remedies of creditors or by general equitable
principles.
4. The Shares have been duly authorized and, upon their issuance, will be
validly issued, fully paid and non-assessable, and will not have been issued in
violation of or subject to any statutory preemptive rights or any preemptive
rights, rights of first refusal or similar rights created by any contracts to
which the Company is a party and of which such counsel is aware.
5. The Conversion Shares have been duly authorized and reserved for
issuance upon conversion of the Shares or the Notes, as the case may be, and if
and when issued in accordance with the Certificate of Designations or the
Indenture, as the case may be, will be duly and validly issued, fully paid and
nonassessable and will not have been issued in violation of or subject to any
statutory preemptive rights or any preemptive rights, rights of first refusal or
similar rights created by any contracts to which the Company is a party and of
which such counsel is aware.
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6. The Notes are in the form contemplated by the Indenture, have been duly
authorized by the Company for issuance pursuant to the terms of the Indenture
and, when executed by the Company and authenticated by the Trustee in the manner
provided in the Indenture, will constitute valid and binding obligations of the
Company, enforceable against the Company in accordance with their terms, except
as the enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to or affecting
enforcement of the rights and remedies of creditors or by general equitable
principles.
7. The Indenture has been duly and validly authorized by all necessary
corporate action on the part of the Company and the Trustee, and has been duly
executed and delivered by the Company and the Trustee, and is a legally valid
and binding agreement of the Company, enforceable against the Company in
accordance with its terms, except as the enforcement thereof may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar laws
relating to or affecting enforcement of the rights and remedies of creditors or
by general equitable principles. The Indenture (i) has been duly qualified under
the Trust Indenture Act and (ii) complies as to form with the requirements of
the Trust Indenture Act. As of each of the time of purchase and the additional
time of purchase, as applicable, no event has occurred nor has any circumstance
arisen which, had the Notes been issued on such date, would constitute an Event
of Default (as each such term is defined in the Indenture);
8. The Company has an authorized capitalization as set forth in the
Registration Statement and the Prospectus. All of the issued and outstanding
shares of capital stock of the Company and each Subsidiary (a) have been duly
authorized and validly issued, (b) are fully paid and non-assessable, (c) have
been issued in compliance with all federal and state securities laws, (d) have
not been issued in violation of or subject to any statutory preemptive rights,
and (e) have not been issued in violation of or subject to any preemptive
rights, rights of first refusal or similar rights created by any contracts to
which the Company or any Subsidiary is a party and of which such counsel is
aware. All of the issued and outstanding shares of capital stock of each
Subsidiary are owned, directly or indirectly, by the Company free and clear of
any liens, claims or encumbrances of any kind. The Certificate and the Bylaws,
each in the form filed (or incorporated by reference) as an exhibit to the
Registration Statement, have been heretofore duly authorized and adopted, and
are in full force and effect as of the date hereof, in each case in accordance
with the Delaware General Corporation Law.
9. The Certificate of Designations has been duly authorized and adopted by
the Company, has been filed with and accepted by the office of the Secretary of
State of the State of Delaware and is in full force and effect.
10 The capital stock of the Company, including the Shares, conforms to the
descriptions thereof contained in the Registration Statement and the Prospectus.
11. The form of specimen stock certificate relating to the Shares filed as
an exhibit to the Registration Statement complies with the applicable provisions
of the
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Delaware General Corporation Law and the rules and regulations of the New York
Stock Exchange, Inc.
12. The Indenture and the Notes conform in all material respects to the
descriptions thereof in the Registration Statement and the Prospectus.
13. The Registration Statement and the Prospectus and each amendment or
supplement thereto (except as to the financial statements and schedules and
other financial data contained therein, as to which such counsel need express no
opinion) comply as to form in all material respects with the requirements of the
Act, and the conditions to the use of Form S-1 have been satisfied.
14. The Registration Statement has become effective under the Act and, to
such counsel's knowledge, no stop order proceedings with respect thereto are
pending or threatened under the Act, and any required filing of the Prospectus
and any supplement thereto pursuant to Rule 424 under the Act has been made in
the manner and within the time period required by such Rule 424; and the class
of securities consisting of the Preferred Stock has become registered under
Section 12(b) of the Exchange Act.
15. No approval, authorization, consent or order of or filing with any
United States federal, state or local governmental or regulatory commission,
board, body, authority or agency, or of or with the New York Stock Exchange,
Inc., or approval of the stockholders of the Company, is required in connection
with the execution, delivery and performance of this Agreement, the Indenture,
the issuance and sale of the Shares, the issuance of the Conversion Shares, or
the consummation by the Company of the transactions contemplated by the
Transaction Documents other than such as have been filed or obtained under the
Act and the Trust Indenture Act, filed under the Exchange Act, filed with and
accepted by the Delaware Secretary of State, obtained from the New York Stock
Exchange, Inc., each of which has been effected.
16. The Preferred Stock is authorized for listing on the New York Stock
Exchange, Inc.
17. The execution, delivery and performance of this Agreement, the
Indenture and the Notes by the Company, the issuance and sale of the Shares, the
issuance of the Notes in compliance with the Indenture, the issuance of the
Conversion Shares in compliance with the Certificate of Designations or the
Indenture, as the case may be, and the consummation of the transactions
contemplated by the Transaction Documents do not and will not conflict with,
result in any breach or violation of or constitute a default under (nor
constitute any event which with notice, lapse of time or both would result in
any breach or violation of or constitute a default under) (a) the Certificate
(including the Certificate of Designations and any other certificate of
designations) or Bylaws, (b) any indenture, mortgage, deed of trust, bank loan
or credit agreement or other evidence of indebtedness, or any license, lease,
contract or other agreement or instrument known to us to which the Company or
any Subsidiary is a party or by which any of their respective properties are
bound (the foregoing, a "Material Document"), or (c) any United States
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federal or state regulation or rule, or any decree, judgment or order applicable
to the Company, any Subsidiary or any of respective properties, except in the
case of clauses (b) and (c) above, for such breaches, violations or defaults as
could not, individually or in the aggregate, have a Material Adverse Effect.
18. To such counsel's knowledge, the Company is not in breach or violation
of or in default under (nor has any event occurred which with notice, lapse of
time, or both would result in any breach or violation of, or constitute a
default under or give the holder of any indebtedness (or a person acting on such
holder's behalf) the right to require the repurchase, redemption or repayment of
all or a part of such indebtedness under) (a) the Certificate or Bylaws, (b) any
Material Document, or (c) any United States federal or state regulation or rule,
or any decree, judgment or order applicable to the Company, any Subsidiary or
any of their respective properties and known to such counsel.
19. To such counsel's knowledge, there are no actions, suits, claims,
investigations or proceedings pending, threatened or contemplated to which the
Company or any Subsidiary is or would be a party or to which any of their
respective properties is or would be subject at law or in equity, before or by
any United States federal, state or local governmental or regulatory commission,
board, body, authority or agency which are required to be described in the
Registration Statement or the Prospectus but are not so described.
20. The Company is not and, after giving effect to the offering and sale
of the Shares, 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.
21. The information in the Registration Statement and the Prospectus under
the headings "Risk Factors--If sufficient appropriations under the Maritime
Security Act of 1996 are not made in any fiscal year, we may not continue to
receive annual subsidy payments with respect to certain of our vessels," "Risk
Factors--Our business and operations are highly-regulated," "Risk Factors--We
are dependent on government charters and contracts," "Risk Factors--Operating
hazards may increase our operating costs; our insurance coverage is limited,"
"Risk Factors--Our vessels could be seized by maritime claimants, which could
result in a significant loss of earnings and cash flow for the related off-hire
period," "Risk Factors--One of our time charter customers has filed for
bankruptcy, the outcome of which could adversely affect our results of
operations," "Business--Regulation," "Business--New Tax Legislation,"
"Business--Insurance," "Dividend Policy," "Management--Directors and Executive
Officers--NYSE Director Independence Rules," "Management--Executive
Compensation," "Certain Relationships and Transactions," "Description of the
Preferred Stock," "Description of the Notes," "Description of Indebtedness,"
"Description of Common Stock," "Underwriting," and "Part II - Item 14 -
Indemnification of Directors and Officers," insofar as such statements
constitute a summary of documents or matters of law, as of the date hereof, are
accurate
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and complete in all material respects and present fairly the information
required to be shown.
22. To such counsel's knowledge, no holders of securities of the Company
have rights to the registration of such securities under the Registration
Statement, other than rights that have been waived or not exercised in
connection with the transactions contemplated by the Registration Statement.
23. To such counsel's knowledge, there are no agreements to which the
Company is a party that are required to be filed as exhibits to the Registration
Statement which have not been filed as so required.
24. The statements set forth in the Registration Statement and the
Prospectus under the heading "Material U.S. Federal Income Tax Considerations,"
while not purporting to address all possible United States federal income tax
consequences of acquiring, owning or disposing of the Shares, the Notes and the
Common Stock, insofar as they purport to constitute summaries of matters of
United States federal income tax law or legal conclusions with respect thereto,
constitute accurate summaries of the matters described therein in all material
respects.
25. To such counsel's knowledge, with respect to trademarks, trade names,
patent rights, copyrights, licenses, approvals, trade secrets and other similar
rights (collectively, "Intellectual Property Rights"), the Company and the
Subsidiaries own or possess such Intellectual Property Rights as are reasonably
necessary to conduct their business as now conducted, and the expected
expiration of any such Intellectual Property Rights would not result in a
Material Adverse Effect. To such counsel's knowledge, the Company has not
received any notice of infringement or conflict with asserted Intellectual
Property Rights of others, which infringement or conflict, if the subject of an
unfavorable decision, would result in a Material Adverse Effect. To such
counsel's knowledge, any of the Company's discoveries, inventions, products, or
processes referred to in the Registration Statement or Prospectus do not
infringe or conflict with any right or patent which is the subject of a patent
application known to the Company.
26. Immediately prior to the sale of the Shares by the Company pursuant to
the terms of the Agreement, the Company was a citizen of the United States
within the meaning of Section 2 of the Shipping Act and was qualified to engage
in the coastwise trade of the United States.
27. Immediately following the sale of the Shares by the Company and the
compliance by the Company and the Underwriter with all of the provisions of the
Agreement (and the consummation of the transactions herein contemplated), the
Company will remain a citizen of the United States within the meaning of Section
2 of the Shipping Act and will continue to be qualified to engage in the
coastwise trade of the United States.
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28. Nothing has come to our attention which leads us to believe that, at
the date of the Prospectus, at the time of purchase and at the time of
additional purchase, as the case may be, the Registration Statement and the
Prospectus (other than the financial statements including supporting schedules
and other financial and statistical information derived therefrom, as to which
such counsel need express no opinion) contained any untrue statement of a
material fact or omitted to state a material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading.
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EXHIBIT C
OFFICERS' CERTIFICATE
Each of the undersigned, Xxxx X. Xxxxxxx, Chairman of the Board and Chief
Executive Officer, and Xxxx X. Xxxxxxxx, Vice President and Chief Financial
Officer of International Shipholding Corporation, a Delaware corporation (the
"COMPANY"), on behalf of the Company, does hereby certify pursuant to Section
6(h) of that certain Underwriting Agreement dated December 29, 2004 (the
"UNDERWRITING AGREEMENT") between the Company and Xxxxxx, Xxxxx Xxxxx,
Incorporated (terms used in this Certificate but not defined herein are as
defined in the Underwriting Agreement) do hereby certify, in their respective
capacities as officers of the Company, as follows:
1. The representations, warranties and agreements of the Company
contained in the Underwriting Agreement were true and correct when made and are
true and correct as of the date hereof;
2. The Company has performed all covenants and agreements and satisfied
all conditions contained in the Underwriting Agreement;
3. (i) No stop order with respect to the effectiveness of the
Registration Statement has been issued under the Securities Act of 1933, as
amended, and the rules and regulations thereunder (collectively, the "Act") and
no proceedings have been initiated under Section 8(d) or 8(e) of the Act; (ii)
the undersigned has carefully examined the Registration Statement and the
Prospectus; (iii) the Registration Statement and all amendments thereto do not
contain an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading; and (iv)
the Prospectus and all amendments or supplements thereto do not contain an
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein, in the light of
the circumstances under which they were made, not misleading;
4. Between the time of execution of the Underwriting Agreement and the
time of purchase or the additional time of purchase, as the case may be, (i) no
Material Adverse Effect and no development involving a prospective Material
Adverse Effect has occurred or become known to the undersigned, (ii) no change
in the capital stock or long-term debt of the Company or any Subsidiary (other
than as contemplated by the Underwriting Agreement) has occurred or become known
to the undersigned and (iii) no transaction which is material to the Company and
the Subsidiaries, taken as a whole, has been entered into by the Company or any
Subsidiary.
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5. Jones, Walker, Waechter, Poitevent, Carrere & Xxxxxxx, L.L.P. and
Xxxxxxx LLP are entitled to rely on this certificate in connection with the
opinions such firms are rendering pursuant to the Underwriting Agreement.
[SIGNATURES NEXT PAGE]
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IN WITNESS WHEREOF, I have signed my name to this Officers' Certificate
this 6th day of January, 2005.
_____________________________________
Xxxx X. Xxxxxxx
Chairman of the Board and Chief
Executive Officer
_____________________________________
Xxxx X. Xxxxxxxx
Vice President and Chief Financial Officer
[SIGNATURE PAGE TO OFFICERS' CERTIFICATE]
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