Exhibit 1.1
WESCO INTERNATIONAL, INC.
COMMON STOCK, $.01 PAR VALUE
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UNDERWRITING AGREEMENT
December 16, 2004
Xxxxxxx, Xxxxx & Co.,
Xxxxxx Brothers Inc.,
X.X. Xxxxxx Securities Inc.,
UBS Securities LLC,
Xxxxxx X. Xxxxx & Co. Incorporated,
Bear, Xxxxxxx & Co. Inc.,
c/o Goldman, Sachs & Co.,
00 Xxxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000.
Ladies and Gentlemen:
WESCO International, Inc., a Delaware corporation (the "Company"),
proposes, subject to the terms and conditions stated herein, to issue and sell
to the Underwriters named in Schedule I hereto (the "Underwriters") an aggregate
of 4,000,000 shares of Common Stock, $.01 par value ("Stock"), of the Company
and, at the election of the Underwriters, up to 128,086 additional shares of
Stock, and the stockholders of the Company named in Schedule II hereto (the
"Selling Stockholders") propose, subject to the terms and conditions stated
herein, to sell to the Underwriters an aggregate of 6,000,000 shares and, at the
election of the Underwriters, up to 1,371,914 additional shares of Stock from
Cypress Merchant Banking Partners L.P. and Cypress Offshore Partners L.P. (the
"Cypress Selling Stockholders"). The aggregate of 10,000,000 shares to be sold
by the Company and the Selling Stockholders is herein called the "Firm Shares"
and the aggregate of 1,500,000 additional shares to be sold by the Company and
the Cypress Selling Stockholders is herein called the "Optional Shares". The
Firm Shares and the Optional Shares that the Underwriters elect to purchase
pursuant to Section 2 hereof are herein collectively called the "Shares".
1. (a) The Company represents and warrants to, and agrees with, each of
the Underwriters that:
(i) A registration statement on Form S-3 (File No. 333-119909) (the
"Initial Registration Statement") in respect of the Shares has been filed
with the Securities and Exchange Commission (the "Commission"); the
Initial Registration Statement and any post-effective amendment thereto,
each in the form heretofore delivered to you, and, excluding exhibits to
the Initial Registration Statement but including all documents
incorporated by reference in the prospectus included therein, to you for
each of the other Underwriters, have been declared effective by the
Commission in such form; other than a registration statement, if any,
increasing the size of the offering (a "Rule 462(b) Registration
Statement"), filed pursuant to Rule 462(b) under the Securities Act of
1933, as amended (the "Act"), which became effective upon filing, no other
document with respect to the Initial Registration
Statement or document incorporated by reference therein has heretofore
been filed or transmitted for filing with the Commission (other than
prospectuses filed pursuant to Rule 424(b) of the rules and regulations of
the Commission under the Act, each in the form heretofore delivered to the
Underwriters); and no stop order suspending the effectiveness of the
Initial Registration Statement, any post-effective amendment thereto or
the Rule 462(b) Registration Statement, if any, has been issued and no
proceeding for that purpose has been initiated or, to the Company's
knowledge, threatened by the Commission (any preliminary prospectus
included in the Initial Registration Statement or filed with the
Commission pursuant to Rule 424(a) of the rules and regulations of the
Commission under the Act, is hereinafter called a "Preliminary
Prospectus"; the various parts of the Initial Registration Statement and
the Rule 462(b) Registration Statement, if any, including all exhibits
thereto and the documents incorporated by reference in the prospectus
contained in the Initial Registration Statement at the time such part of
the Initial Registration Statement became effective, each as amended at
the time such part of the Initial Registration Statement became effective
or such part of the Rule 462(b) Registration Statement, if any, became or
hereafter becomes, effective, are hereinafter collectively called the
"Registration Statement"; the prospectus relating to the Shares, in the
form in which it has most recently been filed, or transmitted for filing,
with the Commission on or prior to the date of this Agreement, is
hereinafter called the "Prospectus"; any reference herein to any
Preliminary Prospectus or the Prospectus shall be deemed to refer to and
include the documents incorporated by reference therein pursuant to Item
12 of Form S-3 under the Act, as of the date of such Preliminary
Prospectus or Prospectus, as the case may be; any reference to any
amendment or supplement to any Preliminary Prospectus or the Prospectus
shall be deemed to refer to and include any documents filed after the date
of such Preliminary Prospectus or Prospectus, as the case may be, under
the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and
incorporated by reference in such Preliminary Prospectus or Prospectus, as
the case may be; any reference to any amendment to the Initial
Registration Statement shall be deemed to refer to and include any annual
report of the Company filed pursuant to Section 13(a) or 15(d) of the
Exchange Act after the effective date of the Registration Statement that
is incorporated by reference in the Registration Statement; and any
reference to the Prospectus as amended or supplemented shall be deemed to
refer to the Prospectus as amended or supplemented in relation to the
Shares in the form in which it is filed with the Commission pursuant to
Rule 424(b) under the Act in accordance with Section 5(a) hereof,
including any documents incorporated by reference therein as of the date
of such filing);
(ii) The documents incorporated by reference in the Prospectus, when
they became effective or were filed with the Commission, as the case may
be, together, where applicable, with any amendments thereto, conformed in
all material respects to the requirements of the Act or the Exchange Act,
as applicable, and the rules and regulations of the Commission thereunder,
and none of such documents contained an untrue statement of a material
fact or omitted to state a material fact required to be stated therein or
necessary to make the statements therein not misleading; and any further
documents so filed and incorporated by reference in the Prospectus or any
further amendment or supplement thereto, when such documents become
effective or are filed with the Commission, as the case may be, will
conform in all material respects to the requirements of the Act or the
Exchange Act, as applicable, and the rules and regulations of the
Commission thereunder and will not contain an untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading;
provided, however, that this representation and warranty shall not apply
to any statements or omissions made in reliance upon and in conformity
with information furnished in writing to the Company by an
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Underwriter through Xxxxxxx, Xxxxx & Co. expressly for use therein or by a
Selling Stockholder expressly for use in the preparation of the answers
therein to Item 7 of Form S-3;
(iii) The Registration Statement and the Prospectus conform, and any
further amendments or supplements to the Registration Statement or the
Prospectus will conform, in all material respects to the requirements of
the Act and the rules and regulations of the Commission thereunder and do
not and will not, as of the applicable effective date as to the
Registration Statement and any amendment thereto and as of the applicable
filing date as to the Prospectus and any amendment or supplement thereto,
contain an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements
therein not misleading; provided, however, that this representation and
warranty shall not apply to any statements or omissions made in reliance
upon and in conformity with information furnished in writing to the
Company by an Underwriter through Xxxxxxx, Sachs & Co. expressly for use
therein or by a Selling Stockholder expressly for use in the preparation
of the answers therein to Item 7 of Form S-3;
(iv) Neither the Company nor any of its "Significant Subsidiaries"
(as defined in Rule 1-02 of Regulation S-X and listed on Annex 1(a)(iv)
hereto and referred to herein as the "Significant Subsidiaries") has
sustained since the date of the latest audited financial statements
included or incorporated by reference in the Prospectus any material loss
or interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor dispute
or court or governmental action, order or decree, otherwise than as set
forth or contemplated in the Prospectus; and, since the respective dates
as of which information is given in the Registration Statement and the
Prospectus, there has not been any change in the capital stock of the
Company or any Significant Subsidiary or consolidated long-term debt of
the Company and its subsidiaries or any material adverse change, or any
development involving a prospective material adverse change, in or
affecting the general affairs, management, financial position,
stockholders' equity or results of operations of the Company and its
Significant Subsidiaries, otherwise than as set forth or contemplated in
the Prospectus;
(v) The Company and its Significant Subsidiaries have good and
marketable title in fee simple to all real property and good and
marketable title to all personal property owned by them, in each case free
and clear of all liens, encumbrances and defects except for any such lien,
encumbrance and defect as is described in the Prospectus or any such lien,
encumbrance and defect as does not materially affect the value of such
property and does not materially interfere with the use made and proposed
to be made of such property by the Company and its Significant
Subsidiaries; and any real property and buildings held under lease by the
Company and its Significant Subsidiaries are held by them under valid,
subsisting and enforceable leases with such exceptions as are not material
and do not materially interfere with the use made and proposed to be made
of such real property and buildings by the Company and its Significant
Subsidiaries;
(vi) The Company has been duly incorporated and is validly existing
as a corporation in good standing under the laws of the State of Delaware,
with power and authority (corporate and other) to own its properties and
conduct its business as described in the Prospectus, and has been duly
qualified as a foreign corporation for the transaction of business and is
in good standing under the laws of each other jurisdiction in which it
owns or leases properties or conducts any business so as to require such
qualification, except where the failure to so qualify or to be in good
standing would not have a material adverse effect on the financial
condition, results of operations, business or prospects of the Company, or
is subject to no material liability or disability by reason of the failure
to be so qualified in any such jurisdiction;
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and each Significant Subsidiary of the Company has been duly incorporated
and is validly existing as a corporation in good standing under the laws
of its jurisdiction of incorporation;
(vii) The Company has an authorized capitalization as set forth in
the Prospectus, and all of the outstanding shares of capital stock of the
Company have been duly and validly authorized and issued, are fully paid
and non-assessable and conform to the description of the Stock contained
in the Prospectus; and all of the outstanding shares of capital stock of
each Significant Subsidiary of the Company have been duly and validly
authorized and issued, are fully paid and non-assessable and are owned
directly or indirectly by the Company, free and clear of all liens,
encumbrances, equities or claims;
(viii) The unissued Shares to be issued and sold by the Company to
the Underwriters hereunder have been duly and validly authorized and, when
issued and delivered against payment therefor as provided herein, will be
duly and validly issued and fully paid and non-assessable and will conform
to the description of the Stock contained in the Prospectus;
(ix) The issue and sale of the Shares to be sold by the Company and
the compliance by the Company with all of the provisions of this Agreement
and the consummation of the transactions herein contemplated will not (i)
violate or result in a breach of any of the terms or provisions of, or
constitute a default under, any indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument to which the Company or any of
its Significant Subsidiaries is a party or by which the Company or any of
its Significant Subsidiaries is bound or to which any of the property or
assets of the Company or any of its Significant Subsidiaries is subject,
except for any such breach or violation that would not, individually or in
the aggregate, have a material adverse effect on the current or future
consolidated financial position, stockholders' equity or results of
operations of the Company or any of its Significant Subsidiaries, or
otherwise interfere with the consummation of the transactions consummated
by this Agreement; (ii) result in any violation of the provisions of the
Certificate of Incorporation or By-laws of the Company; or (iii) result in
any violation of any statute or any order, rule or regulation of any court
or governmental agency or body having jurisdiction over the Company or any
of its Significant Subsidiaries or any of their properties; and no
consent, approval, authorization, order, registration or qualification of
or with any such court or governmental agency or body is required for the
issue and sale of the Shares or the consummation by the Company of the
transactions contemplated by this Agreement, except the registration under
the Act of the Shares and such consents, approvals, authorizations,
registrations or qualifications as may be required under state securities
or Blue Sky laws in connection with the purchase and distribution of the
Shares by the Underwriters;
(x) Neither the Company nor any of its Significant Subsidiaries is
in violation of its Certificate of Incorporation or By-laws or in default
in the performance or observance of any obligation, agreement, covenant or
condition contained in any indenture, mortgage, deed of trust, loan
agreement, lease or other agreement or instrument to which it is a party
or by which it or any of its properties may be bound, except for any such
violation or default that would not, individually or in the aggregate,
have a material adverse effect on the current or future consolidated
financial position, stockholders' equity or results of operations of the
Company or any of its Significant Subsidiaries;
(xi) The statements set forth in the Prospectus under the caption
"Description of Capital Securities", insofar as they purport to constitute
a summary of the terms of the Stock and under the captions "Plan of
Distribution" and "Underwriting", insofar as they purport to describe the
provisions of the laws and documents referred to therein, are accurate,
complete and fair in all material respects;
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(xii) Other than as set forth in the Prospectus, there are no legal
or governmental proceedings pending to which the Company or any of its
Significant Subsidiaries is a party or of which any property of the
Company or any of its Significant Subsidiaries is the subject which would
individually or in the aggregate have a material adverse effect on the
current or future consolidated financial position, stockholders' equity or
results of operations of the Company and its subsidiaries; and, to the
best of the Company's knowledge, no such proceedings are threatened or
contemplated by governmental authorities or threatened by others;
(xiii) The Company is not and, after giving effect to the offering
and sale of the Shares, will not be an "investment company", as such term
is defined in the Investment Company Act of 1940, as amended (the
"Investment Company Act");
(xiv) Neither the Company nor any of its 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;
(xv) PricewaterhouseCoopers LLP, who have certified certain
financial statements of the Company and its subsidiaries, are independent
registered public accountants as required by the Act and the rules and
regulations of the Commission thereunder;
(xvi) The Company and each of its Significant Subsidiaries maintain
a system of internal accounting controls sufficient to provide reasonable
assurance that (A) transactions are executed in accordance with
management's general or specific authorizations; (B) transactions are
recorded as necessary to permit preparation of financial statements in
conformity with generally accepted accounting principles and to maintain
asset accountability; (C) access to assets is permitted only in accordance
with management's general or specific authorization; and (D) the recorded
accountability for assets is compared with the existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences;
(xvii) Other than as set forth in the Prospectus, there are no costs
or liabilities of the Company or any of its Significant Subsidiaries
associated with or arising from the application of any and all applicable
foreign, federal, state and local laws, rules, ordinances, directives and
regulations relating to the protection of human health and safety, the
protection or restoration of the environment or hazardous or toxic
substances or wastes, pollutants or contaminants ("Environmental Laws")
(including, without limitation, any capital or operating expenditures
required for investigation, clean-up, closure or monitoring of currently
or formerly owned or operated properties or compliance with any
Environmental Laws or any permits, licenses or other approvals required of
the Company or any of its Significant Subsidiaries under Environmental
Laws to conduct their respective businesses, any related constraints on
operating activities and any actual or potential liabilities, costs or
obligations to third parties, including governmental authorities) which
would, singularly or in the aggregate, have a material adverse effect on
the Company;
(xviii)The Company and each of its Significant Subsidiaries possess
all licenses, certificates, authorizations and permits issued by, and have
made all declarations and filings with, the appropriate federal, state or
foreign regulatory agencies or bodies which are necessary or desirable for
the ownership of their respective properties or the conduct of their
respective businesses as described in the Prospectus, except where the
failure to possess any such license, certificate, authorization or permit
or to make any such declaration or filing would not, individually or in
the aggregate have a material adverse effect on the current or future
consolidated financial position, stockholders' equity or results of
operations of the Company or any of its Significant Subsidiaries. Neither
the Company nor any of its Significant Subsidiaries has received
notification of any revocation or modification of any such license,
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certificate, authorization or permit or has any reason to believe that any
such license, certificate, authorization or permit will not be renewed in
the ordinary course;
(xix) The Company and each of its Significant Subsidiaries have
filed all federal, state, local and foreign income and franchise tax
returns required to be filed through the date hereof and have paid all
taxes due thereon, other than those being contested in good faith with
adequate reserves provided, and no tax deficiency has been determined
adversely to the Company or any of its Significant Subsidiaries which has
had (nor do the Company or any of its Significant Subsidiaries have any
knowledge of any tax deficiency which, if determined adversely to the
Company or any of its Significant Subsidiaries, could reasonably be
expected to have) a material adverse effect on the Company;
(xx) The Company and each of its Significant Subsidiaries have
insurance covering their respective properties, operations, personnel and
businesses, which insurance is in amounts and insures against such losses
and risks as are adequate to protect the Company and each of its
Significant Subsidiaries and each of their respective businesses;
(xxi) No labor disturbance by or dispute with the employees of the
Company or any of its Significant Subsidiaries that has resulted or could
reasonably be expected to result in a material adverse effect on the
Company exists or, to the best knowledge of the Company, is contemplated
or threatened; and
(xxii) Except as disclosed in the Prospectus, no person or entity
has the right to require registration of shares of Stock or other
securities of the Company because of the filing or effectiveness of the
Initial Registration Statements or otherwise, except for persons and
entities who have expressly waived such right or who have been given
proper notice and have failed to exercise such right within the time or
times required under the terms and conditions of such right.
(b) Each of the Selling Stockholders severally represents and warrants to,
and agrees with, each of the Underwriters and the Company that:
(i) All consents, approvals, authorizations and orders necessary for
the execution and delivery by such Selling Stockholder of this Agreement
and, in the case of Xxx X. Xxxxx (the "Management Selling Stockholder"),
of the Power of Attorney and the Custody Agreement hereinafter referred
to, and for the sale and delivery of the Shares to be sold by such Selling
Stockholder hereunder, have been obtained; and such Selling Stockholder
has full right, power and authority to enter into this Agreement, and, in
the case such Selling Stockholder is the Management Selling Stockholder,
the Power-of-Attorney and the Custody Agreement, and to sell, assign,
transfer and deliver the Shares to be sold by such Selling Stockholder
hereunder;
(ii) The sale of the Shares to be sold by such Selling Stockholder
hereunder and the compliance by such Selling Stockholder with all of the
provisions of this Agreement, and, in the case such Selling Stockholder is
the Management Selling Stockholder, the Power of Attorney and the Custody
Agreement and the consummation of the transactions herein and therein
contemplated will not conflict with or result in a breach or violation of
any of the terms or provisions of, or constitute a default under, any
statute, indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which such Selling Stockholder is a party or by
which such Selling Stockholder is bound or to which any of the property or
assets of such Selling Stockholder is subject, nor will such action result
in any violation of the provisions of the partnership agreement of such
Selling Stockholder if such Selling Stockholder is a partnership or any
statute or any order, rule or regulation of any court or governmental
agency
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or body having jurisdiction over such Selling Stockholder or the property
of such Selling Stockholder;
(iii) Such Selling Stockholder has, and immediately prior to each
Time of Delivery (as defined in Section 4 hereof) such Selling
Stockholder, will have, good and valid title to the Shares to be sold by
such Selling Stockholder hereunder, free and clear of all liens,
encumbrances, equities or claims; and, upon delivery of such Shares and
payment therefor pursuant hereto, good and valid title to such Shares,
free and clear of all liens, encumbrances, equities or claims, will pass
to the several Underwriters;
(iv) Such Selling Stockholder will comply with the selling
restrictions set forth in the Form of Lock-up Agreement attached hereto as
Annex 7(l)(i);
(v) Such Selling Stockholder has not taken and will not take,
directly or indirectly, any action which is designed to or which has
constituted or which might reasonably be expected to cause or result in
stabilization or manipulation of the price of any security of the Company
to facilitate the sale or resale of the Shares;
(vi) To the extent that any statements or omissions made in the
Registration Statement, any Preliminary Prospectus, the Prospectus or any
amendment or supplement thereto are made in reliance upon and in
conformity with written information furnished to the Company by such
Selling Stockholder expressly for use in the preparation of the answers
therein to Item 7 of Form S-3, such Preliminary Prospectus and the
Registration Statement did, and the Prospectus and any further amendments
or supplements to the Registration Statement and the Prospectus, when they
become effective or are filed with the Commission, as the case may be,
will not contain any untrue statement of a material fact or omit to state
any material fact required to be stated therein or necessary to make the
statements therein not misleading;
(vii) In order to document the Underwriters' compliance with the
reporting and withholding provisions of the Tax Equity and Fiscal
Responsibility Act of 1982 with respect to the transactions herein
contemplated, such Selling Stockholder will deliver to you prior to or at
the First Time of Delivery (as hereinafter defined) a properly completed
and executed United States Treasury Department Form W-9 (or other
applicable form or statement specified by Treasury Department regulations
in lieu thereof);
(viii) In case such Selling Stockholder is the Management Selling
Stockholder, certificates in negotiable form representing all of the
Shares to be sold by such Selling Stockholder hereunder have been placed
in custody under a Custody Agreement, in the form heretofore furnished to
you (the "Custody Agreement"), duly executed and delivered by such Selling
Stockholder to Mellon Investor Services LLC, as custodian (the
"Custodian"), and such Selling Stockholder has duly executed and delivered
a Power of Attorney, in the form heretofore furnished to you (the "Power
of Attorney"), appointing the persons indicated in Schedule II hereto, and
each of them, as such Selling Stockholder's attorneys-in-fact (the
"Attorneys-in-Fact") with authority to execute and deliver this Agreement
on behalf of such Selling Stockholder, to determine the purchase price to
be paid by the Underwriters to the Selling Stockholders as provided in
Section 2 hereof, to authorize the delivery of the Shares to be sold by
such Selling Stockholder hereunder and otherwise to act on behalf of such
Selling Stockholder in connection with the transactions contemplated by
this Agreement and the Custody Agreement;
(ix) In case such Selling Stockholder is the Management Selling
Stockholder, the Shares represented by the certificates held in custody
for such Selling Stockholder under the Custody Agreement are subject to
the interests of the Underwriters hereunder; the
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arrangements made by such Selling Stockholder for such custody, and the
appointment by such Selling Stockholder of the Attorneys-in-Fact by the
Power of Attorney, are to that extent irrevocable; and
(x) The obligations of the Selling Stockholders hereunder shall not
be terminated by operation of law, whether by the death or incapacity of
any individual Selling Stockholder or, in the case of an estate or trust,
by the death or incapacity of any executor or trustee or the termination
of such estate or trust, or in the case of a partnership or corporation,
by the dissolution of such partnership or corporation, or by the
occurrence of any other event; if any individual Selling Stockholder or
any such executor or trustee should die or become incapacitated, or if any
such estate or trust should be terminated, or if any such partnership or
corporation should be dissolved, or if any other such event should occur,
before the delivery of the Shares hereunder, certificates representing the
Shares shall be delivered by or on behalf of the Selling Stockholders in
accordance with the terms and conditions of this Agreement and, in the
case such Selling Stockholder is the Management Selling Stockholder, of
the Custody Agreement; and, in the case such Selling Stockholder is the
Management Selling Stockholder, actions taken by the Attorneys-in-Fact
pursuant to the Power of Attorney shall be as valid as if such death,
incapacity, termination, dissolution or other event had not occurred,
regardless of whether or not the Custodian, the Attorneys-in-Fact, or any
of them, shall have received notice of such death, incapacity,
termination, dissolution or other event.
2. Subject to the terms and conditions herein set forth, (a) the Company
and the Selling Stockholders, as and to the extent indicated in Schedule II
hereto, subject to the terms and conditions stated herein, agree, severally and
not jointly, to sell to each of the Underwriters, and each of the Underwriters
agrees, severally and not jointly, to purchase from the Company and each of the
Selling Stockholders, at a purchase price per share of $25.07, the number of
Firm Shares (to be adjusted by you so as to eliminate fractional shares)
determined by multiplying the aggregate number of Shares to be sold by the
Company and each of the Selling Stockholders as set forth opposite their
respective names in Schedule II hereto by a fraction, the numerator of which is
the aggregate number of Firm Shares to be purchased by such Underwriter as set
forth opposite the name of such Underwriter in Schedule I hereto and the
denominator of which is the aggregate number of Firm Shares to be purchased by
all of the Underwriters from the Company and all of the Selling Stockholders
hereunder; (b) to the extent that the Underwriters shall exercise the election
to purchase Optional Shares as provided below, the Cypress Selling Stockholders
agree, severally and not jointly, to sell to each of the Underwriters, and each
of the Underwriters agrees, severally and not jointly, to purchase from each of
the Cypress Selling Stockholders, at the purchase price per share set forth in
clause (a) of this Section 2, that portion of the initial 1,371,914 Optional
Shares as to which such election shall have been exercised (to be adjusted by
you so as to eliminate fractional shares) determined by multiplying such number
of Optional Shares by a fraction the numerator of which is the maximum number of
Optional Shares which such Underwriter is entitled to purchase as set forth
opposite the name of such Underwriter in Schedule I hereto and the denominator
of which is the maximum number of Optional Shares that all of the Underwriters
are entitled to purchase hereunder; and (c) to the extent that the Underwriters
shall exercise the election to purchase more than 1,371,914 Optional Shares in
the aggregate as provided below, the Company agrees to sell to each of the
Underwriters, and each of the Underwriters agrees, severally and not jointly, to
purchase from such the Company, at the purchase price per share set forth in
clause (a) of this Section 2, up to 128,086 Optional Shares, as to which such
election shall have been exercised (to be adjusted by you so as to eliminate
fractional shares) determined by subtracting 1,371,914 Optional Shares from such
number of Optional Shares which such Underwriters elect to purchase.
The Cypress Selling Stockholders, as and to the extent indicated in
Schedule II hereto, hereby grant, severally and not jointly, to the Underwriters
the right to purchase at their election up to
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1,371,914 Optional Shares, and the Company hereby grants to the Underwriters the
right to purchase at their election up to 128,086 Optional Shares to the extent
that the Underwriters elect to purchase more than 1,371,914 Optional Shares in
the aggregate, at the purchase price per share set forth in the paragraph above,
for the sole purpose of covering sales of shares in excess of the number of Firm
Shares, provided that the purchase price per Optional Share shall be reduced by
an amount per share equal to any dividends or distributions declared by the
Company and payable on the Firm Shares but not payable on the Optional Shares.
Any such election to purchase Optional Shares from the Cypress Selling
Stockholders shall be made in proportion to the maximum number of Optional
Shares to be sold by the Cypress Selling Stockholders as set forth in Schedule
II hereto. Any such election to purchase Optional Shares may be exercised only
by written notice from you to the Company and the Cypress Selling Stockholders,
given within a period of 30 calendar days after the date of this Agreement and
setting forth the aggregate number of Optional Shares to be purchased and the
date on which such Optional Shares are to be delivered, as determined by you but
in no event earlier than the First Time of Delivery (as defined in Section 4
hereof) or, unless you, the Cypress Selling Stockholders and, if the Company is
selling Optional Shares pursuant to such election, the Company otherwise agree
in writing, earlier than two or later than ten business days after the date of
such notice.
3. Upon the authorization by you of the release of the Firm Shares, the
several Underwriters propose to offer the Firm Shares for sale upon the terms
and conditions set forth in the Prospectus.
4. (a) The Shares to be purchased by each Underwriter hereunder, in
definitive form, and in such authorized denominations and registered in such
names as Xxxxxx Brothers Inc. may request upon at least two business days' prior
notice to the Company and the Selling Stockholders shall be delivered by or on
behalf of the Company and the Selling Stockholders to Xxxxxx Brothers Inc.,
through the facilities of The Depository Trust Company ("DTC"), for the account
of such Underwriter, against payment by or on behalf of such Underwriter of the
purchase price therefor by wire transfer of Federal (same-day) funds to the
account specified by the Company and the Custodian, as their interests may
appear, to Xxxxxx Brothers Inc. at least two business days in advance. The
Company will cause the certificates representing the Shares to be made available
for checking and packaging at least two business days prior to the Time of
Delivery (as defined below) with respect thereto at the office of DTC or its
designated custodian (the "Designated Office"). The time and date of such
delivery and payment shall be, with respect to the Firm Shares, 9:30 a.m., New
York City time, on December 22, 2004 or such other time and date as Xxxxxxx,
Sachs & Co., Xxxxxx Brothers Inc., the Company and the Selling Stockholders may
agree upon in writing, and, with respect to the Optional Shares, 9:30 a.m., New
York City time, on the date specified by Xxxxxxx, Sachs & Co. and Xxxxxx
Brothers Inc. in the written notice given by Xxxxxxx, Sachs & Co. and Xxxxxx
Brothers Inc. of the Underwriters' election to purchase such Optional Shares, or
such other time and date as Xxxxxxx, Sachs & Co., Xxxxxx Brothers Inc., the
Cypress Selling Stockholders and, if the Company is selling Optional Shares
pursuant to such election, the Company may agree upon in writing. Such time and
date for delivery of the Firm Shares is herein called the "First Time of
Delivery", such time and date for delivery of the Optional Shares, if not the
First Time of Delivery, is herein called the "Second Time of Delivery", and each
such time and date for delivery is herein called a "Time of Delivery".
(b) The documents to be delivered at each Time of Delivery by or on behalf
of the parties hereto pursuant to Section 7 hereof, including the cross receipt
for the Shares and any additional documents requested by the Underwriters
pursuant to Section 7(n) hereof, will be delivered at the offices of Xxxxxxxx &
Xxxxxxxx LLP, 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (the "Closing
Location"), and the Shares will be delivered at the Designated Office, all at
such Time of Delivery. A meeting will be held at the Closing Location at 3:00
p.m., New York City time, on the New York
9
Business Day next preceding such Time of Delivery, at which meeting the final
drafts of the documents to be delivered pursuant to the preceding sentence will
be available for review by the parties hereto. For the purposes of this Section
4, "New York Business Day" shall mean each Monday, Tuesday, Wednesday, Thursday
and Friday which is not a day on which banking institutions in New York are
generally authorized or obligated by law or executive order to close.
5. The Company agrees with each of the Underwriters:
(a) To prepare the Prospectus as amended and supplemented in
relation to the Shares in a form approved by you and to file such
Prospectus pursuant to Rule 424(b) under the Act not later than the
Commission's close of business on the second business day following the
execution and delivery of this Agreement, or, if applicable, such earlier
time as may be required by Rule 424(b) under the Act; to make no further
amendment or any supplement to the Registration Statement or Prospectus as
amended or supplemented after the date of this Agreement and prior to the
last Time of Delivery which shall be disapproved by you promptly after
reasonable notice thereof; to advise you promptly of any such amendment or
supplement after any Time of Delivery for the Shares and furnish you with
copies thereof; to file promptly all reports and any definitive proxy or
information statements required to be filed by the Company with the
Commission pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange
Act subsequent to the date of the Prospectus and for so long as the
delivery of a prospectus is required in connection with the offering or
sale of the Shares, and during such same period to advise you, promptly
after it receives notice thereof, of the time when any amendment to the
Registration Statement has been filed or becomes effective or any
supplement to the Prospectus or any amended Prospectus has been filed with
the Commission, of the issuance by the Commission of any stop order or of
any order preventing or suspending the use of any prospectus relating to
the Shares, of the suspension of the qualification of the Shares for
offering or sale in any jurisdiction, of the initiation or threatening of
any proceeding for any such purpose, or of any request by the Commission
for the amending or supplementing of the Registration Statement or
Prospectus or for additional information; and, in the event of the
issuance of any such stop order or of any such order preventing or
suspending the use of any prospectus relating to the Shares or suspending
any such qualification, promptly to use its best efforts to obtain the
withdrawal of such order;
(b) Promptly from time to time to take such action as you may
reasonably request to qualify the Shares for offering and sale under the
securities laws of such jurisdictions as you may request and to comply
with such laws so as to permit the continuance of sales and dealings
therein in such jurisdictions for as long as may be necessary to complete
the distribution of the Shares, provided that in connection therewith the
Company shall not be required to qualify as a foreign corporation or to
file a general consent to service of process in any jurisdiction;
(c) Prior to 10:00 A.M., New York City time, on the New York
Business Day next succeeding the date of this Agreement and from time to
time, to furnish the Underwriters with written and electronic copies of
the Prospectus as amended or supplemented in New York City in such
quantities as you may reasonably request, and, if the delivery of a
prospectus is required at any time in connection with the offering or sale
of the Shares and if at such time any events shall have occurred as a
result of which the Prospectus as then amended or supplemented would
include an untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made when such Prospectus
is delivered, not misleading, or, if for any other reason it shall be
necessary during such same period to amend or supplement the Prospectus or
to file under the Exchange Act any document incorporated by reference in
the Prospectus in order to comply with the Act or the Exchange Act, to
notify
10
you and upon your request to file such document and to prepare and furnish
without charge to each Underwriter and to any dealer in securities as many
written and electronic copies as you may from time to time reasonably
request of an amended Prospectus or a supplement to the Prospectus which
will correct such statement or omission or effect such compliance;
(d) To the extent not available via the Commission's Electronic
Data, Gathering, Analysis and Retrieval System ("XXXXX"), to make
generally available to its securityholders as soon as practicable, but in
any event not later than eighteen months after the effective date of the
Registration Statement (as defined in Rule 158(c) under the Act), an
earnings statement of the Company and its subsidiaries (which need not be
audited) complying with Section 11(a) of the Act and the rules and
regulations of the Commission thereunder (including, at the option of the
Company, Rule 158);
(e) During the Lock-up Period (as defined below), not to offer,
sell, contract to sell or otherwise dispose of, except as provided
hereunder, any Stock, securities of the Company that are substantially
similar to the Shares, including but not limited to any securities that
are convertible into or exchangeable for, or that represent the right to
receive, Stock or any such substantially similar securities (other than
pursuant to employee stock option plans existing on, or upon the
conversion or exchange of convertible or exchangeable securities
outstanding as of, the date of this Agreement), without the prior written
consent of Xxxxxxx, Xxxxx & Co. and Xxxxxx Brothers Inc. (the initial
lock-up period will commence on the date hereof and will continue to and
including the date 90 days after the date of the Prospectus; provided,
however, that if (1) during the last 17 days of the initial lock-up period
the Company releases earnings results or announces material news or a
material event or (2) prior to the expiration of the initial lock-up
period the Company announces that it will release earnings results during
the 16-day period beginning on the last day of the initial lock-up period,
then in each case the lock-up period will be automatically extended until
the expiration of the 18-day period beginning on the date of release of
the earnings results or the announcement of the material news or material
event, as applicable, unless Xxxxxxx, Xxxxx & Co. and Xxxxxx Brothers Inc.
waive, in writing, such extension (the "Lock-up Period");
(f) To provide written notice to the Underwriters and to each of the
Company's directors and executive officers and the stockholders listed in
Annex 7(l)(ii) hereto of any event that would result in an extension of
the Lock-up Period in accordance with the agreement in the form of Annex
7(l)(i) hereto executed by each such person and delivered to the
Underwriters on or prior to the date hereof;
(g) To the extent not available via XXXXX, (i) to furnish to its
stockholders as soon as practicable after the end of each fiscal year an
annual report (including a balance sheet and statements of income,
stockholders' equity and cash flows of the Company and its consolidated
subsidiaries certified by independent public accountants) and, (ii) as
soon as practicable after the end of each of the first three quarters of
each fiscal year (beginning with the fiscal quarter ending after the
effective date of the Registration Statement), to make available to its
stockholders consolidated summary financial information of the Company and
its subsidiaries for such quarter in reasonable detail;
(h) During a period of three years from the effective date of the
Registration Statement, to the extent not available via XXXXX, to furnish
to you copies of all reports or other communications (financial or other)
furnished to stockholders, and to deliver to you (i) as soon as they are
available, copies of any reports and financial statements furnished to or
filed with the Commission or any national securities exchange on which any
class of securities of the Company is listed; and (ii) such additional
information concerning the business and financial condition of the Company
as you may from time to time reasonably request (such
11
financial statements to be on a consolidated basis to the extent the
accounts of the Company and its subsidiaries are consolidated in reports
furnished to its stockholders generally or to the Commission);
(i) To use the net proceeds received by it from the sale of the
Shares pursuant to this Agreement in the manner specified in the
Prospectus under the caption "Use of Proceeds";
(j) To use its best efforts to list, subject to notice of issuance,
the Shares on the New York Stock Exchange (the "Exchange");
(k) If the Company elects to rely upon Rule 462(b), the Company
shall file a Rule 462(b) Registration Statement with the Commission in
compliance with Rule 462(b) by 10:00 P.M., Washington, D.C. time, on the
date of this Agreement, and the Company shall at the time of filing either
pay to the Commission the filing fee for the Rule 462(b) Registration
Statement or give irrevocable instructions for the payment of such fee
pursuant to Rule 111(b) under the Act; and
(l) Upon request of any Underwriter, to furnish, or cause to be
furnished, to such Underwriter an electronic version of the Company's
trademarks, servicemarks and corporate logo for use on the website, if
any, operated by such Underwriter for the purpose of facilitating the
on-line offering of the Shares (the "License"); provided, however, that
the License shall be used solely for the purpose described above, is
granted without any fee and may not be assigned or transferred.
1 6. The Company covenants and agrees with the several Underwriters that
it will pay or cause to be paid the following: (i) the fees, disbursements and
expenses of the Selling Stockholders' counsels and the Company's counsel and
accountants in connection with the registration of the Shares under the Act and
all other expenses in connection with the preparation, printing and filing of
the Registration Statement, any Preliminary Prospectus and the Prospectus and
amendments and supplements thereto and the mailing and delivering of copies
thereof to the Underwriters and dealers; (ii) the cost of printing or producing
any Agreement among Underwriters, this Agreement, the Blue Sky Memorandum,
closing documents (including compilations thereof) and any other documents in
connection with the offering, purchase, sale and delivery of the Shares; (iii)
all expenses in connection with the qualification of the Shares for offering and
sale under state securities laws as provided in Section 5(b) hereof, including
the fees and disbursements of counsel for the Underwriters in connection with
such qualification and in connection with the Blue Sky survey; (iv) all fees and
expenses in connection with listing the Shares on the Exchange; (v) the filing
fees incident to, and the fees and disbursements of counsel for the Underwriters
in connection with, securing any required review by the National Association of
Securities Dealers, Inc. of the terms of the sale of the Shares; (vi) the cost
of preparing stock certificates; (vii) the cost and charges of any transfer
agent or registrar; (viii) the fees and expenses of the Attorneys-in-Fact and
the Custodian; and (ix) all other costs and expenses incident to the performance
of its obligations hereunder and the Selling Stockholders obligations hereunder
which are not otherwise specifically provided for in this Section. Each Selling
Stockholder covenants and agrees with the several Underwriters that it will pay
or cause to be paid all taxes incident to the sale and delivery of the Shares to
be sold by such Selling Stockholder to the Underwriters hereunder. In connection
with the preceding sentence, Xxxxxxx, Xxxxx & Co. agrees to pay New York State
stock transfer tax, and such Selling Stockholder agrees to reimburse Xxxxxxx,
Sachs & Co. for associated carrying costs if such tax payment is not rebated on
the day of payment and for any portion of such tax payment not rebated. It is
understood that the Company shall bear, and the Selling Stockholders shall not
be required to pay or to reimburse the Company for, the cost of any other
matters not directly relating to the sale and purchase of the Shares pursuant to
this Agreement, and that, except as provided in this Section, and Sections 8 and
11 hereof, the Underwriters will pay all of their own costs and expenses,
including the fees of their
12
counsel, transfer taxes on resale of any of the Shares by them, and any
advertising expenses connected with any offers they may make.
7. The obligations of the Underwriters hereunder, as to the Shares to be
delivered at each Time of Delivery, shall be subject, in their discretion, to
the condition that all representations and warranties and other statements of
the Company and of the Selling Stockholders herein are, at and as of such Time
of Delivery, true and correct, the condition that the Company and the Selling
Stockholders shall have performed all of its and their obligations hereunder
theretofore to be performed, and the following additional conditions:
(a) The Prospectus as amended or supplemented shall have been filed
with the Commission pursuant to Rule 424(b) within the applicable time
period prescribed for such filing by the rules and regulations under the
Act and in accordance with Section 5(a) hereof; if the Company has elected
to rely upon Rule 462(b), the Rule 462(b) Registration Statement shall
have become effective by 10:00 P.M., Washington, D.C. time, on the date of
this Agreement; no stop order suspending the effectiveness of the
Registration Statement or any part thereof shall have been issued and no
proceeding for that purpose shall have been initiated or threatened by the
Commission; and all requests for additional information on the part of the
Commission shall have been complied with to your reasonable satisfaction;
(b) Xxxxxxxx & Xxxxxxxx LLP, counsel for the Underwriters, shall
have furnished to you such written opinion or opinions, dated such Time of
Delivery, with respect to the incorporation of the Company, the validity
of the Shares and such other related matters as you may reasonably
request, and such counsel shall have received such papers and information
as they may reasonably request to enable them to pass upon such matters;
(c) Xxxxxxxxxxx & Xxxxxxxx LLP, counsel for the Company, shall have
furnished to you their written opinion (a draft of such opinion is
attached as Annex 7(c) hereto), dated such Time of Delivery, in form and
substance satisfactory to you, to the effect that:
(i) The Company is a corporation duly incorporated, validly
existing and in good standing under the laws of the State of
Delaware, with the corporate power and authority to own, lease and
operate its properties and conduct its business as described in the
Prospectus as amended or supplemented.
(ii) The Company has an authorized and outstanding
capitalization as set forth in the Prospectus as amended or
supplemented; all of the issued and outstanding shares of capital
stock of the Company (including the Shares being delivered at such
Time of Delivery) have been duly authorized and validly issued and
are fully paid and non-assessable; and the Shares conform to the
description of the Stock contained in the Prospectus as amended or
supplemented.
(iii) The Company is duly qualified to do business as a
foreign corporation 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 on the financial
condition, results of operations, business or prospects of the
Company (such counsel being entitled to rely in respect of the
opinion in this clause upon opinions of local counsel and in respect
of matters of fact upon certificates of officers of the Company).
(iv) Each of the Significant Subsidiaries is a corporation or
limited liability company duly incorporated or organized, as the
case may be, validly existing and in good standing under the laws of
the State of Delaware, with the corporate or limited liability
company power and authority, as the case may be, to own, lease and
operate its
13
properties and to conduct its business as described in the
Registration Statement and the Prospectus as amended or
supplemented. All of the outstanding shares of capital stock of each
of the Significant Subsidiaries have been duly authorized and
validly issued, are fully paid and non-assessable and, except as
otherwise stated in the Prospectus as amended or supplemented, are
owned by the Company.
(v) To the best of such counsel's knowledge without
investigation, there are no actions, suits, claims, investigations
or proceedings pending or overtly threatened in writing to which the
Company or any of its Significant Subsidiaries is a party or to
which any of the Company's properties is subject which are required
to be described in the Registration Statement or Prospectus as
amended or supplemented but are not so described.
(vi) This Agreement has been duly authorized, executed and
delivered by the Company.
(vii) The execution, delivery and performance of this
Agreement by the Company, the issuance and sale of the Shares by the
Company and the consummation by the Company of the transactions
contemplated thereby do not and will not 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 Restated
Certificate of Incorporation or By-laws of the Company or the
similar charter documents of any of the Significant Subsidiaries,
(B) (i) any indenture, mortgage, deed of trust, bank loan or credit
agreement or other evidence of indebtedness, or (ii) the terms of
any license, lease, contract or other agreement or instrument filed
or required to be filed as an exhibit to the Registration Statement
or the Company's Annual Report on Form 10-K for the year ended
December 31, 2003, the Company's Quarterly Reports on Form 10-Q for
the periods ended March 31, 2004, June 30, 2004 and September 30,
2004 and any Reports on Form 8-K filed by the Company since December
31, 2003, (C) the General Corporation Law of the State of Delaware,
the laws of the State of New York, the laws of the Commonwealth of
Pennsylvania, or any applicable statute, regulation or rule of the
United States, or (D) to such counsel's knowledge, any decree,
judgment or order applicable by its terms to the Company or any of
the Significant Subsidiaries.
(viii) Except as disclosed in the Prospectus as amended or
supplemented, no approval, authorization, consent or order of or
filing with any federal, state or local governmental or regulatory
commission, board, body, authority or agency is required in
connection with the issuance and sale of the Shares and consummation
by the Company of the transactions contemplated hereby other than
registration of the Shares under the Act (except we express no
opinion as to any necessary qualification under the state securities
or blue sky laws of the various jurisdictions in which the Shares
are being offered by the Underwriters).
(ix) Neither the Company nor any of its Significant
Subsidiaries is (i) in violation of its Certificate of Incorporation
or By-laws, or its Certificate of Formation and Limited Liability
Company Agreement, as the case may be, or (ii) except where such
violation or noncompliance, individually or in the aggregate, would
neither have a material adverse effect on the financial condition,
results of operations, business or prospects of the Company or any
of its Significant Subsidiaries nor interfere with the consummation
of the transactions contemplated by this Agreement, in default in
the performance or observance of (A) any indenture, mortgage, deed
of trust, bank loan or credit agreement or other evidence of
indebtedness, or (B) the terms of any license, lease, contract or
14
other agreement or instrument, filed or required to be filed as an
exhibit to the Registration Statement or the Company's Annual Report
on Form 10-K for the year ended December 31, 2003, the Company's
Quarterly Reports on Form 10-Q for the periods ended March 31, 2004,
June 30, 2004 and September 30, 2004 and any Reports on Form 8-K
filed by the Company since December 31, 2003.
(x) The information in the Prospectus under the headings
"Description of Capital Securities," and "Plan of Distribution" and
"Underwriting", insofar as such statements constitute a summary of
documents or matters of law, are accurate in all material respects
and present fairly the information required to be shown.
(xi) The Company is not an "investment company", as such term
is defined in the Investment Company Act.
(xii) The documents incorporated by reference in the
Prospectus as amended or supplemented (other than the financial
statements and related schedules therein, as to which such counsel
need express no opinion), when they became effective or were filed
with the Commission, as the case may be, together, where applicable,
with any amendments in respect thereof, complied as to form in all
material respects with the requirements of the Act or the Exchange
Act and the rules and regulations of the Commission thereunder, as
applicable.
(xiii) The Registration Statement and the Prospectus as
amended or supplemented (except as to the financial statements and
schedules and other financial or data contained therein, as to which
we express no opinion) comply as to form in all material respects
with the requirements of the 1933 Act.
Such counsel shall further state that on the basis of the foregoing,
nothing has come to such counsel's attention that causes such
counsel to believe that the Registration Statement, at the time it
became effective, contained an untrue statement of a material fact
or omitted to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, or that the
Prospectus or any amendment or supplement thereto, at the date of
such Prospectus, such amendment or such supplement, and at such Time
of Delivery, contained an untrue statement of a material fact or
omitted to state a material fact required to be stated therein or
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading (it being
understood that such counsel is expressing no opinion with respect
to the financial statements and related notes and schedules, and
other financial data included in or omitted from the Registration
Statement, the Prospectus, or any amendment or supplement thereto).
(d) Xxxxxxxxxxx & Xxxxxxxx LLP, counsel for the Management Selling
Stockholder, shall have furnished to you their written opinion (a draft of
such opinion is attached as Annex 7(d) hereto), dated such Time of
Delivery, in form and substance satisfactory to you, to the effect that:
(i) The Management Selling Stockholder has individual power
and authority to enter into this Agreement, the Custody Agreement
and the Power of Attorney and to sell, assign, transfer and deliver
the Shares delivered by the Management Selling Stockholder at the
Time of Delivery.
(ii) This Agreement has been duly authorized, executed and
delivered by or on behalf of the Management Selling Stockholder; a
Power of Attorney and a Custody Agreement have been duly executed
and delivered by the Management Selling Stockholder and constitute
legal, valid and binding obligations of the Management Selling
15
Stockholder enforceable against the Management Selling Stockholder
in accordance with their respective terms, subject to bankruptcy,
insolvency, reorganization, fraudulent transfer, moratorium and
other similar laws of general applicability relating to or affecting
creditors' rights generally and by general equitable principles
(whether considered in a proceeding in equity or at law).
(iii) The Management Selling Stockholder is the registered
owner of the Shares to be sold; assuming the several Underwriters
purchase the Shares delivered by the Management Selling Stockholder
for value and without notice of any adverse claim, as such term is
used in the Uniform Commercial Code as currently in effect, the
delivery of certificates representing such Shares will pass to the
Underwriters at the Time of Delivery all rights in such Shares, free
of any adverse claims within the meaning of the Uniform Commercial
Code as currently in effect.
(iv) The execution, delivery and performance by the Management
Selling Stockholder of this Agreement, the Custody Agreement and the
Power of Attorney and the sale of the Shares to be sold by the
Management Selling Stockholder hereunder will not result in a breach
or violation of any of the terms and provisions of, and will not
constitute a default under, and will not result in the creation or
imposition of any lien, charge or encumbrance upon the Shares to be
sold by the Management Selling Stockholder under (A) any agreement
or instrument known to such counsel to which the Management Selling
Stockholder is a party or by which the Management Selling
Stockholder is bound or to which any of the property or assets of
the Management Selling Stockholder is subject, (B) any federal
statute, rule or regulation or existing law, rule or regulation
applicable to the Management Selling Stockholder, or (C) the terms
of any judgment, order or decree of any government, governmental
agency or body, or court having jurisdiction over the Management
Selling Stockholder known to such counsel that (1) names the
Management Selling Stockholder and is specifically directed to the
Management Selling Stockholder or any of his property and (2)
expressly and adversely affects the title to the Shares to be sold
by the Management Selling Stockholder pursuant to this Agreement or
the ability of the Management Selling Stockholder to perform his
obligations under this Agreement, the Custody Agreement and the
Power of Attorney, except for such breaches, violations, defaults,
liens, charges and encumbrances which would not, individually or in
the aggregate, have a material adverse effect on the ability of the
Management Selling Stockholder to consummate the sale of the Shares
by the Management Selling Stockholder or perform the Management
Selling Stockholder's obligations under this Agreement, the Custody
Agreement and the Power of Attorney.
(v) No consent, approval, authorization, order, registration
or qualification of, or filing with, any third party (whether acting
in an individual, fiduciary or other capacity) or any governmental
or regulatory agency or body or any court is required to be obtained
or made by the Management Selling Stockholder for the consummation
of the sale of the Shares by the Management Selling Stockholder and
of the transactions contemplated by this Agreement, except such as
have been obtained and made or are required under the Securities Act
and such as may be required under state securities laws in
connection with the sale or distribution of the Shares (as to which
such counsel need express no opinion).
In rendering the opinion described above, such counsel may rely on
certificates signed by the Management Selling Stockholder as to matters of
fact respecting ownership of, and any liens, encumbrances, equities or
adverse claims on, the Shares sold by the Management Selling Stockholder.
16
(e) Xxxxxxx Xxxxxxx & Xxxxxxxx LLP, counsel for the Cypress Selling
Stockholders, shall have furnished to you their written opinion (a draft
of such opinion is attached as Annex 7(e) hereto), dated such Time of
Delivery, in form and substance satisfactory to you, to the effect that:
(i) Cypress Merchant Banking Partners L.P. ("Cypress") has
full partnership power, right and authority to sell the Shares to be
sold by Cypress. Upon the payment and transfer contemplated by this
Agreement, the Underwriters will acquire a security entitlement with
respect to the Shares to be sold by the Cypress Selling Stockholders
and no action based on an adverse claim may be asserted against the
Underwriters.
(ii) This Agreement has been duly executed and delivered by or
on behalf of Cypress and by Cypress Associates L.P., the general
partner of Cypress (the "General Partner").
(iii) The sale of the Shares by Cypress and the compliance by
Cypress with all of the provisions of this Agreement will not breach
or result in a default under any indenture, mortgage, deed of trust,
loan agreement or other agreement or instrument identified on a
schedule furnished to such counsel by Cypress and which Cypress has
represented lists all material agreements and instruments to which
Cypress is a party or by which Cypress is bound, nor will such
action violate the organizational documents of Cypress or the
General Partner or any federal or New York State statute or the
Delaware Revised Uniform Limited Partnership Act or any rule or
regulation that has been issued pursuant to any federal or New York
State statute or the Delaware Revised Uniform Limited Partnership
Act or any order known to such counsel issued pursuant to any
federal or New York State statute or the Delaware Revised Uniform
Limited Partnership Act by any court or governmental agency or body
having jurisdiction over Cypress or the General Partner or any of
their respective properties.
(iv) No consent, approval, authorization, order, registration
or qualification of or with any federal or New York State
governmental agency or body or any Delaware governmental agency or
body acting pursuant to the Delaware Revised Uniform Limited
Partnership Act or, to such counsel's knowledge, any federal or New
York State court or any Delaware court acting pursuant to the
Delaware Revised Uniform Limited Partnership Act is required for the
sale of the Shares by each of the Cypress Selling Stockholders and
the compliance by each of the Cypress Selling Stockholders with all
of the provisions of this Agreement, except for the registration
under the Securities Act of the Shares, and such consents,
approvals, authorizations, registrations or qualifications as may be
required under state securities or Blue Sky laws in connection with
the purchase and distribution of the Shares by the Underwriters.
(f) Walkers, counsel for Cypress Offshore Partners L.P., shall have
furnished to you their written opinion, dated such Time of Delivery, in
the form attached as Annex 7(f) hereto.
(g) On the date of the Prospectus at a time prior to the execution
of this Agreement, at 9:30 a.m., New York City time, on the effective date
of any post-effective amendment to the Registration Statement filed
subsequent to the date of this Agreement and also at each Time of
Delivery, PricewaterhouseCoopers LLP shall have furnished to you a letter
or letters, dated the respective dates of delivery thereof, in form and
substance satisfactory to you, to the effect set forth in Annex 7(g)(i)
hereto (the executed copy of the letter delivered prior to the execution
of this Agreement is attached as Annex 7(g)(ii) hereto and a draft of the
form of letter to be delivered on the effective date of any post-effective
amendment to the Registration Statement and as of each Time of Delivery is
attached as Annex 7(g)(iii) hereto);
17
(h)(i) Neither the Company nor any of its Significant Subsidiaries
shall have sustained since the date of the latest audited financial
statements included or incorporated by reference in 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 court or governmental action, order or decree, otherwise than
as set forth or contemplated in the Prospectus, and (ii) since the
respective dates as of which information is given in the Prospectus there
shall not have been any change in the capital stock or long-term debt of
the Company or any of its Significant Subsidiaries or any change, or any
development involving a prospective change, in or affecting the general
affairs, management, financial position, stockholders' equity or results
of operations of the Company and its Significant Subsidiaries, otherwise
than as set forth or contemplated in the Prospectus, the effect of which,
in any such case described in clause (i) or (ii), is in the judgment of
Xxxxxxx, Sachs & Co. and Xxxxxx Brothers Inc. so material and adverse as
to make it impracticable or inadvisable to proceed with the public
offering or the delivery of the Shares being delivered at such Time of
Delivery on the terms and in the manner contemplated in the Prospectus;
(i) On or after the date hereof (i) no downgrading shall have
occurred in the rating accorded the Company's debt securities or preferred
stock (if any are outstanding), by any "nationally recognized statistical
rating organization", as that term is defined by the Commission for
purposes of Rule 436(g)(2) under the Act, and (ii) no such organization
shall have publicly announced that it has under surveillance or review,
with possible negative implications, its rating of any of the Company's
debt securities or preferred stock;
(j) On or after the date hereof there shall not have occurred any of
the following: (i) a suspension or material limitation in trading in
securities generally on the Exchange; (ii) a suspension or material
limitation in trading in the Company's securities on the Exchange; (iii) a
general moratorium on commercial banking activities declared by either
Federal or New York State authorities or a material disruption in
commercial banking or securities settlement or clearance services in the
United States; (iv) the outbreak or escalation of hostilities involving
the United States or the declaration by the United States of a national
emergency or war or (v) the occurrence of 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 judgment of Xxxxxxx, Sachs & Co. and Xxxxxx Brothers
Inc. makes it impracticable or inadvisable to proceed with the public
offering or the delivery of the Shares being delivered at such Time of
Delivery on the terms and in the manner contemplated in the Prospectus;
(k) The Shares at such Time of Delivery shall have been duly listed,
subject to notice of issuance, on the Exchange;
(l) The Company has obtained and delivered to the Underwriters
executed copies of an agreement in the form of Annex 7(l)(i) from the
Company's directors and executive officers and the Selling Stockholders
listed in Annex 7(l)(ii);
(m) The Company shall have complied with the provisions of Section
5(c) hereof with respect to the furnishing of prospectuses on the New York
Business Day next succeeding the date of this Agreement; and
(n) The Company and the Selling Stockholders shall have furnished or
caused to be furnished to you at such Time of Delivery certificates of
officers of the Company and of the Selling Stockholders, respectively,
satisfactory to you as to the accuracy of the representations and
warranties of the Company and the Selling Stockholders, respectively,
herein at and as of such Time of Delivery, as to the performance by the
Company and the Selling Stockholders of all of their respective
obligations hereunder to be performed at or prior
18
to such Time of Delivery, and as to such other matters as you may
reasonably request, and the Company shall have furnished or caused to be
furnished certificates as to the matters set forth in subsections (a) and
(h) of this Section.
8. (a) The Company will indemnify and hold harmless each Underwriter
against any losses, claims, damages or liabilities, joint or several, to which
such Underwriter may become subject, under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon an untrue statement or alleged untrue statement of a
material fact contained in any Preliminary Prospectus, any preliminary
prospectus supplement, the Registration Statement, the Prospectus as amended or
supplemented and any other prospectus relating to the Shares, or any amendment
or supplement thereto, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, and will reimburse each
Underwriter for any legal or other expenses reasonably incurred by such
Underwriter in connection with investigating or defending any such action or
claim as such expenses are incurred; provided, however, that the Company shall
not be liable in any such case to the extent that any such loss, claim, damage
or liability arises out of or is based upon an untrue statement or alleged
untrue statement or omission or alleged omission made in any Preliminary
Prospectus, any preliminary prospectus supplement, the Registration Statement,
the Prospectus as amended or supplemented and any other prospectus relating to
the Shares, or any such amendment or supplement in reliance upon and in
conformity with written information furnished to the Company by any Underwriter
through Xxxxxxx, Sachs & Co. expressly for use therein.
(b) Each of the Selling Stockholders will indemnify and hold harmless each
Underwriter against any losses, claims, damages or liabilities, joint or
several, to which such Underwriter may become subject, under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon an untrue statement or alleged
untrue statement of a material fact contained in any Preliminary Prospectus, any
preliminary prospectus supplement, the Registration Statement, the Prospectus as
amended or supplemented and any other prospectus relating to the Shares, or any
amendment or supplement thereto, or arise out of or are based upon the omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, in each case
to the extent, but only to the extent, that such untrue statement or alleged
untrue statement or omission or alleged omission was made in any Preliminary
Prospectus, any preliminary prospectus supplement, the Registration Statement,
the Prospectus as amended or supplemented and any other prospectus relating to
the Shares, or any such amendment or supplement in reliance upon and in
conformity with written information furnished to the Company by such Selling
Stockholder expressly for use therein in the preparation of the answers therein
to Item 7 of Form S-3; and will reimburse each Underwriter for any legal or
other expenses reasonably incurred by such Underwriter in connection with
investigating or defending any such action or claim as such expenses are
incurred; provided, however, that such Selling Stockholder shall not be liable
in any such case to the extent that any such loss, claim, damage or liability
arises out of or is based upon an untrue statement or alleged untrue statement
or omission or alleged omission made in any Preliminary Prospectus, any
preliminary prospectus supplement, the Registration Statement, the Prospectus as
amended or supplemented and any other prospectus relating to the Shares, or any
such amendment or supplement in reliance upon and in conformity with written
information furnished to the Company by any Underwriter through Xxxxxxx, Xxxxx &
Co. expressly for use therein; provided, further, that the liability of each
Selling Stockholder pursuant to this subsection (b) shall not exceed the product
of the number of Shares sold by such Selling Stockholder, including any Optional
Shares, and the initial public offering price of the Shares as set forth on the
cover page of the Prospectus.
19
(c) Each Underwriter will indemnify and hold harmless the Company and each
Selling Stockholder against any losses, claims, damages or liabilities to which
the Company or such Selling Stockholder may become subject, under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon an untrue statement or alleged
untrue statement of a material fact contained in any Preliminary Prospectus, any
preliminary prospectus supplement, the Registration Statement, the Prospectus as
amended or supplemented and any other prospectus relating to the Shares, or any
amendment or supplement thereto, or arise out of or are based upon the omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, in each case
to the extent, but only to the extent, that such untrue statement or alleged
untrue statement or omission or alleged omission was made in any Preliminary
Prospectus, any preliminary prospectus supplement, the Registration Statement,
the Prospectus as amended or supplemented and any other prospectus relating to
the Shares, or any such amendment or supplement in reliance upon and in
conformity with written information furnished to the Company by such Underwriter
through Xxxxxxx, Sachs & Co. expressly for use therein; and will reimburse the
Company and each Selling Stockholder for any legal or other expenses reasonably
incurred by the Company or such Selling Stockholder in connection with
investigating or defending any such action or claim as such expenses are
incurred.
(d) Promptly after receipt by an indemnified party under subsection (a),
(b) or (c) above of notice of the commencement of any action, such indemnified
party shall, if a claim in respect thereof is to be made against the
indemnifying party under such subsection, notify the indemnifying party in
writing of the commencement thereof; but the omission so to notify the
indemnifying party shall not relieve it from any liability which it may have to
any indemnified party otherwise than under such subsection. In case any such
action shall be brought against any indemnified party and it shall notify the
indemnifying party of the commencement thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it shall wish, jointly
with any other indemnifying party similarly notified, to assume the defense
thereof, with counsel satisfactory to such indemnified party (who shall not,
except with the consent of the indemnified party, be counsel to the indemnifying
party), and, after notice from the indemnifying party to such indemnified party
of its election so to assume the defense thereof, the indemnifying party shall
not be liable to such indemnified party under such subsection for any legal
expenses of other counsel or any other expenses, in each case subsequently
incurred by such indemnified party, in connection with the defense thereof other
than reasonable costs of investigation. No indemnifying party shall, without the
written consent of the indemnified party, effect the settlement or compromise
of, or consent to the entry of any judgment with respect to, any pending or
threatened action or claim in respect of which indemnification or contribution
may be sought hereunder (whether or not the indemnified party is an actual or
potential party to such action or claim) unless such settlement, compromise or
judgment (i) includes an unconditional release of the indemnified party from all
liability arising out of such action or claim and (ii) does not include a
statement as to or an admission of fault, culpability or a failure to act, by or
on behalf of any indemnified party.
(e) If the indemnification provided for in this Section 8 is unavailable
to or insufficient to hold harmless an indemnified party under subsection (a),
(b) or (c) above in respect of any losses, claims, damages or liabilities (or
actions in respect thereof) referred to therein, then each indemnifying party
shall contribute to the amount paid or payable by such indemnified party as a
result of such losses, claims, damages or liabilities (or actions in respect
thereof) in such proportion as is appropriate to reflect the relative benefits
received by the Company and the Selling Stockholders on the one hand and the
Underwriters on the other from the offering of the Shares. If, however, the
allocation provided by the immediately preceding sentence is not permitted by
applicable law or if the indemnified party failed to give the notice required
under subsection (d) above, then each indemnifying party shall contribute to
such amount paid or payable by such indemnified party in such
20
proportion as is appropriate to reflect not only such relative benefits but also
the relative fault of the Company and the Selling Stockholders on the one hand
and the Underwriters on the other in connection with the statements or omissions
which resulted in such losses, claims, damages or liabilities (or actions in
respect thereof), as well as any other relevant equitable considerations. The
relative benefits received by the Company and the Selling Stockholders on the
one hand and the Underwriters on the other shall be deemed to be in the same
proportion as the total net proceeds from the offering (before deducting
expenses) received by the Company and the Selling Stockholders bear to the total
underwriting discounts and commissions received by the Underwriters, in each
case as set forth in the table on the cover page of the Prospectus. The relative
fault shall be determined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by the Company
or the Selling Stockholders on the one hand or the Underwriters on the other and
the parties' relative intent, knowledge, access to information and opportunity
to correct or prevent such statement or omission. The Company, each of the
Selling Stockholders and the Underwriters agree that it would not be just and
equitable if contributions pursuant to this subsection (e) were determined by
pro rata allocation (even if the Underwriters were treated as one entity for
such purpose) or by any other method of allocation which does not take account
of the equitable considerations referred to above in this subsection (e). The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages or liabilities (or actions in respect thereof) referred to above
in this subsection (e) shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any such action or claim. Notwithstanding the provisions of this
subsection (e), no Underwriter shall be required to contribute any amount in
excess of the amount by which the total price at which the Shares underwritten
by it and distributed to the public were offered to the public exceeds the
amount of any damages which such Underwriter has otherwise been required to pay
by reason of such untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation. The Underwriters'
obligations in this subsection (e) to contribute are several in proportion to
their respective underwriting obligations and not joint.
(f) The obligations of the Company and the Selling Stockholders under this
Section 8 shall be in addition to any liability which the Company and the
respective Selling Stockholders may otherwise have and shall extend, upon the
same terms and conditions, to each person, if any, who controls any Underwriter
within the meaning of the Act; and the obligations of the Underwriters under
this Section 8 shall be in addition to any liability which the respective
Underwriters may otherwise have and shall extend, upon the same terms and
conditions, to each officer and director of the Company and to each person, if
any, who controls the Company or any Selling Stockholder within the meaning of
the Act.
9. (a) If any Underwriter shall default in its obligation to purchase the
Shares which it has agreed to purchase hereunder at a Time of Delivery, you may
in your discretion arrange for you or another party or other parties to purchase
such Shares on the terms contained herein. If within thirty-six hours after such
default by any Underwriter you do not arrange for the purchase of such Shares,
then the Company and the Selling Stockholders shall be entitled to a further
period of thirty-six hours within which to procure another party or other
parties satisfactory to you to purchase such Shares on such terms. In the event
that, within the respective prescribed periods, you notify the Company and the
Selling Stockholders that you have so arranged for the purchase of such Shares,
or the Company and the Selling Stockholders notify you that they have so
arranged for the purchase of such Shares, you or the Company and the Selling
Stockholders shall have the right to postpone a Time of Delivery for a period of
not more than seven days, in order to effect whatever changes may thereby be
made necessary in the Registration Statement or the Prospectus as amended or
supplemented, or in any other documents or arrangements, and the Company agrees
to file promptly any amendments or
21
supplements to the Registration Statement or the Prospectus which in your
opinion may thereby be made necessary. The term "Underwriter" as used in this
Agreement shall include any person substituted under this Section with like
effect as if such person had originally been a party to this Agreement with
respect to such Shares.
(b) If, after giving effect to any arrangements for the purchase of the
Shares of a defaulting Underwriter or Underwriters by you and the Company and
the Selling Stockholders as provided in subsection (a) above, the aggregate
number of such Shares which remains unpurchased does not exceed one-eleventh of
the aggregate number of all the Shares to be purchased at such Time of Delivery,
then the Company and the Selling Stockholders shall have the right to require
each non-defaulting Underwriter to purchase the number of Shares which such
Underwriter agreed to purchase hereunder at such Time of Delivery and, in
addition, to require each non-defaulting Underwriter to purchase its pro rata
share (based on the number of Shares which such Underwriter agreed to purchase
hereunder) of the Shares of such defaulting Underwriter or Underwriters for
which such arrangements have not been made; but nothing herein shall relieve a
defaulting Underwriter from liability for its default.
(c) If, after giving effect to any arrangements for the purchase of the
Shares of a defaulting Underwriter or Underwriters by you and the Company and
the Selling Stockholders as provided in subsection (a) above, the aggregate
number of such Shares which remains unpurchased exceeds one-eleventh of the
aggregate number of all of the Shares to be purchased at such Time of Delivery,
or if the Company and the Selling Stockholders shall not exercise the right
described in subsection (b) above to require non-defaulting Underwriters to
purchase Shares of a defaulting Underwriter or Underwriters, then this Agreement
(or, with respect to the Second Time of Delivery, the obligations of the
Underwriters to purchase and of the Company and the Cypress Selling Stockholders
to sell the Optional Shares) shall thereupon terminate, without liability on the
part of any non-defaulting Underwriter or the Company or the Selling
Stockholders, except for the expenses to be borne by the Company and the Selling
Stockholders and the Underwriters as provided in Section 6 hereof and the
indemnity and contribution agreements in Section 8 hereof; but nothing herein
shall relieve a defaulting Underwriter from liability for its default.
10. The respective indemnities, agreements, representations, warranties
and other statements of the Company, the Selling Stockholders and the several
Underwriters, as set forth in this Agreement or made by or on behalf of them,
respectively, pursuant to this Agreement, shall remain in full force and effect,
regardless of any investigation (or any statement as to the results thereof)
made by or on behalf of any Underwriter or any controlling person of any
Underwriter, or the Company, or any of the Selling Stockholders, or any officer
or director or controlling person of the Company, or any controlling person of
any Selling Stockholder, and shall survive delivery of and payment for the
Shares.
11. If this Agreement shall be terminated pursuant to Section 9 hereof,
neither the Company nor the Selling Stockholders shall then be under any
liability to any Underwriter except as provided in Sections 6 and 8 hereof; but,
if for any other reason any Shares are not delivered by or on behalf of the
Company and the Selling Stockholders as provided herein, the Company and each of
the Selling Stockholders pro rata (based on the number of Shares to be sold by
the Company and such Selling Stockholder hereunder), will reimburse the
Underwriters through you for all out-of-pocket expenses approved in writing by
you, including fees and disbursements of counsel, reasonably incurred by the
Underwriters in making preparations for the purchase, sale and delivery of the
Shares not so delivered, but the Company and the Selling Stockholders shall then
be under no further liability to any Underwriter in respect of the Shares not so
delivered except as provided in Sections 6 and 8 hereof.
12. In all dealings hereunder, you shall act on behalf of each of the
Underwriters, and the parties hereto shall be entitled to act and rely upon any
statement, request, notice or agreement on
22
behalf of any Underwriter made or given by you jointly or by Xxxxxxx, Xxxxx &
Co. and Xxxxxx Brothers Inc. on behalf of you as the representatives; and in all
dealings with the Management Selling Stockholder hereunder, you and the Company
shall be entitled to act and rely upon any statement, request, notice or
agreement on behalf of the Management Selling Stockholder made or given by any
or all of the Attorneys-in-Fact for the Management Selling Stockholder.
All statements, requests, notices and agreements hereunder shall be in
writing, and if to the Underwriters shall be delivered or sent by mail, telex or
facsimile transmission to you as the representatives in care of Xxxxxxx, Xxxxx &
Co., 00 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Registration
Department, and Xxxxxx Brothers Inc., 000 0xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Syndicate Department (Fax: 000-000-0000) (and, in the case of notices
under Section 8, also to Xxxxxx Brothers Inc., 000 Xxxx Xxxxxx, 00xx Xxxxx, Xxx
Xxxx, Xxx Xxxx 00000, Attention: Director of Litigation, Office of General
Counsel (Fax: 000-000-0000)); if to any Selling Stockholder shall be delivered
or sent by mail, telex or facsimile transmission to counsel for such Selling
Stockholder at its address set forth in Schedule II hereto; and if to the
Company shall be delivered or sent by mail, telex or facsimile transmission to
the address of the Company set forth in the Registration Statement, Attention:
Secretary; provided, however, that any notice to an Underwriter pursuant to
Section 8(d) hereof shall be delivered or sent by mail, telex or facsimile
transmission to such Underwriter at its address set forth in its Underwriters'
Questionnaire or telex constituting such Questionnaire, which address will be
supplied to the Company or the Selling Stockholders by you on request. Any such
statements, requests, notices or agreements shall take effect upon receipt
thereof.
13. This Agreement shall be binding upon, and inure solely to the benefit
of, the Underwriters, the Company and the Selling Stockholders and, to the
extent provided in Sections 8 and 10 hereof, the officers and directors of the
Company and each person who controls the Company, any Selling Stockholder or any
Underwriter, and their respective heirs, executors, administrators, successors
and assigns, and no other person shall acquire or have any right under or by
virtue of this Agreement. No purchaser of any of the Shares from any Underwriter
shall be deemed a successor or assign by reason merely of such purchase.
14. Time shall be of the essence of this Agreement. As used herein, the
term "business day" shall mean any day when the Commission's office in
Washington, D.C. is open for business.
15. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK.
16. This Agreement may be executed by any one or more of the parties
hereto in any number of counterparts, each of which shall be deemed to be an
original, but all such counterparts shall together constitute one and the same
instrument.
17. The Company and the Selling Stockholders are authorized, subject to
applicable law, to disclose any and all aspects of this potential transaction
that are necessary to support any U.S. federal income tax benefits expected to
be claimed with respect to such transaction, and all materials of any kind
(including tax opinions and other tax analyses) related to those benefits,
without the Underwriters imposing any limitation of any kind.
If the foregoing is in accordance with your understanding, please sign and
return to us six counterparts hereof, and upon the acceptance hereof by you, on
behalf of each of the Underwriters, this letter and such acceptance hereof shall
constitute a binding agreement among each of the Underwriters, the Company and
each of the Selling Stockholders. It is understood that your acceptance of this
letter on behalf of each of the Underwriters is pursuant to the authority set
forth in a form of Agreement among Underwriters, the form of which shall be
submitted to the Company and
23
the Selling Stockholders for examination, upon request, but without warranty on
your part as to the authority of the signers thereof.
24
Any person executing and delivering this Agreement as Attorney-in-Fact for
the Management Selling Stockholder represents by so doing that he has been duly
appointed as Attorney-in-Fact by the Management Selling Stockholder pursuant to
a validly existing and binding Power-of-Attorney which authorizes such
Attorney-in-Fact to take such action.
Very truly yours,
WESCO International, Inc.
By: /s/ Xxxxxxx X. Van Oss
------------------------------------
Name: Xxxxxxx X. Van Oss
Title:
Cypress Merchant Banking Partners L.P.
Cypress Offshore Partners L.P.
By: Cypress Associates L.P.
By: /s/ Xxxxx X. Xxxxxxxx
--------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Member of the Cypress
Group LLC its
General Partner
Xxx X. Xxxxx
By: /s/ Xxxxxxx X. Van Oss
------------------------------------
Name: Xxxxxxx X. Van Oss
Title:
As Attorney-in-Fact acting on behalf
of each of the Selling Stockholders
named in Schedule II to this
Agreement.
Accepted as of the date hereof:
Xxxxxxx, Xxxxx & Co.
Xxxxxx Brothers Inc.
X.X. Xxxxxx Securities Inc.
UBS Securities LLC
Xxxxxx X. Xxxxx & Co. Incorporated
Bear, Xxxxxxx & Co. Inc.
By: /s/ Xxxxxxx, Xxxxx & Co.
-----------------------------------
(Xxxxxxx, Sachs & Co.)
Xxxxxx Brothers Inc.
By: /s/ Xxxxxx Xxxxxxxxx
-----------------------------------
Name: Xxxxxx Xxxxxxxxx
Title: Vice President
On behalf of each of the Underwriters
25
EXECUTION COPY
SCHEDULE I
NUMBER OF OPTIONAL
SHARES TO BE
TOTAL NUMBER OF PURCHASED IF
FIRM SHARES MAXIMUM OPTION
UNDERWRITER TO BE PURCHASED EXERCISED
----------- --------------- ---------
Xxxxxxx, Sachs & Co................................... 3,200,000 480,000
Xxxxxx Brothers Inc................................... 3,200,000 480,000
X.X. Xxxxxx Securities Inc............................ 900,000 135,000
UBS Securities LLC.................................... 900,000 135,000
Xxxxxx X. Xxxxx & Co. Incorporated.................... 900,000 135,000
Bear, Xxxxxxx & Co. Inc............................... 900,000 135,000
---------- ---------
Total........................................ 10,000,000 1,500,000
========== =========
SCHEDULE II
NUMBER OF OPTIONAL
SHARES TO BE
TOTAL NUMBER OF SOLD IF
FIRM SHARES MAXIMUM OPTION
TO BE SOLD EXERCISED
---------- ---------
The Company............................................... 4,000,000 128,086
The Selling Stockholders:...........................
Cypress Merchant Banking Partners L.P.(a)...... 5,182,792 1,304,690
Cypress Offshore Partners L.P.(a).............. 267,208 67,224
Xxx X. Xxxxx(b)................................ 550,000 --
---------- ---------
Total............................................ 10,000,000 1,500,000
========== =========
-------------
(a) These Selling Stockholders are represented by Xxxxxxx Xxxxxxx & Xxxxxxxx
LLP.
(b) These Selling Stockholders are represented by Xxxxxxxxxxx & Xxxxxxxx LLP and
have appointed Xxx X. Xxxxx and Xxxxxxx X. Van Oss, and each of them, as the
Attorneys-in-Fact for such Selling Stockholders.
ANNEX 1(A)(IV)
SIGNIFICANT SUBSIDIARIES
Jurisdiction of
Name Formation
---- ---------
CDW Holdco, LLC Delaware
WESCO Distribution, Inc. Delaware
WESCO Equity Corporation Delaware
WESCO Finance Corporation Delaware
WESCO Receivables Corporation Delaware
ANNEX 7(C)
FORM OF OPINION OF XXXXXXXXXXX & XXXXXXXX LLP, COUNSEL TO THE COMPANY
We have acted as counsel to WESCO International, Inc., a Delaware
corporation (the "Company"), in connection with the sale by the Company today of
an aggregate of _________ shares (the "Shares") of the Company's Common Stock,
$.01 par value ("Common Stock"), consisting of 4,000,000 initial shares of
Common Stock [and [_________] additional shares of Common Stock relating to the
exercise [in full][in part] by the Underwriters of their over-allotment option],
pursuant to the Underwriting Agreement dated December 16, 2004 (the
"Underwriting Agreement") by and among the Company, the selling stockholders
named in Schedule II thereto (the "Selling Stockholders") and the several
Underwriters named in Schedule I thereto (the "Underwriters"). We are delivering
this opinion letter to you at the Company's request pursuant to Section 7(c) of
the Underwriting Agreement. Unless otherwise indicated, capitalized terms used
but not defined in this opinion letter have the meanings given them in the
Underwriting Agreement.
Concurrently, the Selling Stockholders are selling an aggregate of
[6,000,000] shares of Common Stock, consisting of 6,000,000 initial shares of
Common Stock and [_________] additional shares of Common Stock relating to the
exercise [in full][in part] by the Underwriters of their over-allotment option],
pursuant to the Underwriting Agreement.
We are familiar with the Registration Statement on Form S-3 (No.
333-119909), which was filed with the Securities and Exchange Commission (the
"Commission") on October 22, 2004 under the Securities Act of 1933 as amended,
and the rules and regulations thereunder (the "1933 Act"), with Amendment Nos. 1
and 2 thereto, filed on November 29, 2004 and December 3, 2004, respectively,
and with the Prospectus dated December 6, 2004 and the Prospectus Supplement
dated December 16, 2004, each relating to that Registration Statement. In this
opinion letter, that Registration Statement, as amended at the time it became
effective, is referred to as the "Registration Statement", and that Prospectus
Supplement and accompanying Prospectus in the form filed with the Commission
pursuant to Rule 424(b) under the 1933 Act on December 17, 2004 are referred to
together as the "Prospectus."
In connection with rendering the opinions set forth below, we have
examined (i) the Underwriting Agreement, (ii) the Company's Restated Certificate
of Incorporation and By-laws, (iii) resolutions adopted by the Company's Board
of Directors on October 15, 2004 and December 5, 2004 and by the Pricing
Committee of the Company's Board of Directors on December 16, 2004, each
relating to the sale of shares of Common Stock by the Company and the Selling
Stockholders pursuant to the Underwriting Agreement, and (iv) the respective
Certificates of Incorporation and By-laws, or Certificate of Formation and
Limited Liability Company Agreement, as applicable, of each "Significant
Subsidiary" (as defined in Rule 1-02 of Regulation S-X and listed on Annex
1(a)(iv) of the Underwriting Agreement (the "Significant Subsidiaries")), and we
have made such other investigation as we have deemed appropriate. We have
examined and relied on certificates of and telephonic conversations with public
officials and, as to certain matters of fact that are material to our opinions,
we have also examined and relied on a certificate of an officer of the Company
(the "Fact Certificate") (a copy of which is attached to this opinion letter),
the representations of the Company set forth in the Underwriting Agreement, and
certificates, opinions and other documents delivered by or on the behalf of the
Company pursuant to the Underwriting Agreement. We have not independently
established any of the facts so relied on.
For the purposes of this opinion letter, we have made the assumptions
that are customary in opinion letters of this kind, including the assumptions
that each document submitted to us is accurate and complete, that each such
document that is an original is authentic, that each such document that is a
copy conforms to an authentic original, that all signatures (other than
signatures on behalf of the Company) on each such document are genuine, and that
no changes in the facts certified in the Fact Certificate have occurred or will
occur after the date of the Fact Certificate. We have further assumed the legal
capacity of natural persons, and we have assumed that each party to the
Underwriting Agreement (other than the Company) has the legal capacity and has
satisfied all legal requirements that are applicable to that party to the extent
necessary to make the Underwriting Agreement enforceable against that party. We
have not verified any of the foregoing assumptions. References in this opinion
letter to our knowledge or our attention mean a conscious awareness of facts by
any of the lawyers currently with this firm who have given substantive attention
to legal representation of the Company in matters relating directly to the
Underwriting Agreement, the Registration Statement and the Prospectus (the
"Transaction Lawyers") after consultation with such other lawyers currently with
this firm as deemed appropriate by the Transaction Lawyers, and the phrase
"causes us to believe" means that we have formed a conscious belief on the basis
of information that has come to our attention.
During the course of the preparation of the Registration Statement and
the Prospectus, we participated in conferences with representatives of the
Company, including certain of its executive, financial and accounting officers,
representatives of its independent public accountants, and representatives of
the Underwriters, including your counsel, at which conferences the contents of
the Registration Statement and the Prospectus and related matters were
discussed. Between the time of effectiveness of the Registration Statement and
the date hereof, we participated in further discussions with representatives of
the Company and representatives of the Underwriters, including your counsel,
regarding the contents of certain portions of the Registration Statement and the
Prospectus and related matters, and reviewed certificates of certain officers of
the Company, and a letter addressed to you from the Company's independent public
accountants. We have relied as to materiality to a large extent on statements
made by officers and other representatives of the Company at those conferences.
We have not independently verified any information, including financial,
accounting or statistical information, included in the Registration Statement or
the Prospectus.
The opinions expressed in this opinion letter are limited to (i) the
law of the State of New York, other than its law relating to choice of law; (ii)
law of the United States; (iii) solely with respect to the opinions in numbered
paragraphs 1, 2, 4 (with regard to all Significant Subsidiaries other than CDW
Holdco, LLC, a Delaware limited liability company ("CDW")), 6, 7, 8, 9 and 10
below, the General Corporation Law of the State of Delaware; and (iv) solely
with respect to the opinion in numbered paragraph 4, 7 and 9 (with regard solely
to CDW) below, the Delaware Limited Liability Company Act. We are not opining
on, and we assume no responsibility with respect to, the applicability to or
effect on any of the matters covered herein of the laws of any other
jurisdiction, or the laws of any county, municipality or other political
subdivision or local governmental agency or authority.
Based on the foregoing, and subject to the foregoing and the additional
qualifications and other matters set forth below, it is our opinion that:
1. The Company is a corporation duly incorporated, validly existing and
in good standing under the laws of the State of Delaware, with the corporate
power and authority to own, lease and operate its properties and conduct its
business as described in the Prospectus as amended or supplemented.
2. The Company has an authorized and outstanding capitalization as set
forth in the Prospectus as amended or supplemented; all of the issued and
outstanding shares of capital stock of the Company (including the Shares) have
been duly authorized and validly issued and are fully paid and non-assessable;
and the Shares conform to the description of the Stock contained in the
Prospectus as amended or supplemented.
3. The Company is duly qualified to do business as a foreign
corporation 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 on
the financial condition, results of operations, business or prospects of the
Company (with your permission, we have relied in respect of matters of fact
related to the opinion in this paragraph upon a certificate of an officer of the
Company).
4. Each of the Significant Subsidiaries is a corporation or limited
liability company duly incorporated or organized, as the case may be, validly
existing and in good standing under the laws of the State of Delaware, with the
corporate or limited liability company power and authority, as the case may be,
to own, lease and operate its properties and to conduct its business as
described in the Registration Statement and the Prospectus as amended or
supplemented. All of the outstanding shares of capital stock of each of the
Significant Subsidiaries have been duly authorized and validly issued, are fully
paid and non-assessable and, except as otherwise stated in the Prospectus as
amended or supplemented, are owned by the Company.
5. To the best of our knowledge without investigation, there are no
actions, suits, claims, investigations or proceedings pending or overtly
threatened in writing to which the Company or any of the Significant
Subsidiaries is or would be a party or to which any of their respective
properties is subject which are required to be described in the Registration
Statement or Prospectus as amended or supplemented but are not so described.
6. The Underwriting Agreement has been duly authorized, executed and
delivered by the Company.
7. The execution, delivery and performance of the Underwriting
Agreement by the Company, the issuance and sale of the Shares by the Company and
the consummation by the Company of the transactions contemplated thereby do not
and will not 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 Restated
Certificate of Incorporation or By-laws of the Company or the similar charter
documents of any of the Significant Subsidiaries, (B) (i) any indenture,
mortgage, deed of trust, bank loan or credit agreement or other evidence of
indebtedness, or (ii) the terms of any license, lease, contract or other
agreement or instrument filed or required to be filed as an exhibit to the
Registration Statement or the Company's Annual Report on Form 10-K for the year
ended December 31, 2003, the Company's Quarterly Reports on Form 10-Q for the
periods ended March 31, 2004, June 30, 2004 and September 30, 2004 and any
Reports on Form 8-K filed by the Company since December 31, 2003, (C) the
General Corporation Law of the State of Delaware, the laws of the State of New
York or any applicable statute, regulation or rule of the United States, or (D)
to our knowledge, any decree, judgment or order applicable by its terms to the
Company or any of the Significant Subsidiaries.
8. Except as disclosed in the Prospectus as amended or supplemented, no
approval, authorization, consent or order of or filing with any federal, state
or local governmental or regulatory commission, board, body, authority or agency
is required in connection with the issuance and sale of the Shares and
consummation by the Company of the transactions contemplated hereby other than
registration of the Shares under the Act (except we express no opinion as to any
necessary qualification under the state securities or blue sky laws of the
various jurisdictions in which the Shares are being offered by the
Underwriters).
9. Neither the Company nor any of its Significant Subsidiaries is (i)
in violation of its Certificate of Incorporation or By-laws, or its Certificate
of Formation and Limited Liability Company Agreement, as the case may be, or
(ii) except where such violation or noncompliance, individually or in the
aggregate, would neither have a material adverse effect on the financial
condition, results of operations, business or prospects of the Company nor
interfere with the consummation of the transactions contemplated by the
Underwriting Agreement, in default in the performance or observance of (A) any
indenture, mortgage, deed of trust, bank loan or credit agreement or other
evidence of indebtedness, or (B) the terms of any license, lease, contract or
other agreement or instrument, filed or required to be filed as an exhibit to
the Registration Statement or the Company's Annual Report on Form 10-K for the
year ended December 31, 2003, the Company's Quarterly Reports on Form 10-Q for
the periods ended March 31, 2004, June 30, 2004 and September 30, 2004 and any
Reports on Form 8-K filed by the Company since December 31, 2003.
10. The information in the Prospectus under the headings "Description
of Capital Securities," and "Plan of Distribution", insofar as such statements
constitute a summary of documents or matters of law, and "Underwriting", insofar
as such statements constitute a summary of documents, are accurate in all
material respects and present fairly the information required to be shown.
11. The Company is not an "investment company", as such term is defined
in the Investment Company Act.
12. The documents incorporated by reference in the Prospectus as
amended or supplemented (other than the financial statements and related
schedules therein, as to which such counsel need express no opinion), when they
became effective or were filed with the Commission, as the case may be,
together, where applicable, with any amendments in respect thereof, complied as
to form in all material respects with the requirements of the 1933 Act or the
Securities Exchange Act of 1934, as amended, and the rules and regulations
thereunder, as applicable.
13. The Registration Statement and the Prospectus as amended or
supplemented (except as to the financial statements and schedules and other
financial data contained therein, as to which we express no opinion) comply as
to form in all material respects with the requirements of the 1933 Act.
We are not opining as to factual matters, and are not passing upon and
do not assume responsibility for the accuracy, completeness or fairness of the
information contained in the Registration Statement or the Prospectus and have
not made independent investigation of that information (other than as
specifically stated above). We can advise you, however, that on the basis of the
foregoing, nothing has come to our attention that causes us to believe that the
Registration Statement, at the time it became effective, contained an untrue
statement of a material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein not misleading, or
that the Prospectus or any amendment or supplement thereto, at the date of such
Prospectus or such amendment or such supplement, and on the date hereof,
contained an untrue statement of a material fact or omitted to state a material
fact required to be stated therein or
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading (it being understood that we express
no opinion with respect to the financial statements and related notes and
schedules, and other financial data included in or omitted from the Registration
Statement, the Prospectus, or any supplement or amendment thereto).
We are furnishing this opinion letter to you solely in connection with
the issuance and sale of the Shares. You may not rely on this opinion letter in
any other connection, and it may not be furnished to or relied upon by any other
person for any purpose, without our specific prior written consent.
The foregoing opinions are rendered as of the date of this letter. We
assume no obligation to update or supplement any of such opinions to reflect any
changes of law or fact that may occur.
ANNEX 7(D)
FORM OF OPINION OF XXXXXXXXXXX & XXXXXXXX LLP,
COUNSEL TO THE MANAGEMENT SELLING STOCKHOLDER
We have acted as special counsel to the individual selling stockholder
identified in Schedule I attached to this opinion letter (the "Management
Selling Stockholder") in connection with their sale today of an aggregate of
550,000 shares (the "Shares") of Common Stock, $.01 par value ("Common Stock"),
of WESCO International, Inc., a Delaware corporation (the "Company"), pursuant
to the Underwriting Agreement dated December 16, 2004 (the "Underwriting
Agreement") by and among the Company, the selling stockholders named in Schedule
II thereto and the several Underwriters named in Schedule I thereto (the
"Underwriters"). We are delivering this opinion letter to you at the request of
the Company and the Management Selling Stockholder pursuant to Section 7(d) of
the Underwriting Agreement. Unless otherwise indicated, capitalized terms used
but not defined in this opinion letter have the meanings given to them in the
Underwriting Agreement.
Concurrently, the Company is issuing and selling an aggregate of
4,000,000 initial shares of Common Stock [and [_________] additional shares of
Common Stock relating to the exercise [in full][in part] by the Underwriters of
their over-allotment option], pursuant to the Underwriting Agreement, and
Cypress Merchant Banking Partners L.P. and Cypress Offshore Partners L.P. are
selling an aggregate of [_________] initial shares of Common Stock [and
[_________] additional shares of Common Stock relating to the exercise [in
full][in part] by the Underwriters of their over-allotment option], pursuant to
the Underwriting Agreement.
In connection with rendering the opinions set forth below, we have
examined (i) the Underwriting Agreement; (ii) the Management Selling
Stockholder's Power of Attorney dated on or before December 16, 2004 (the "Power
of Attorney") executed by the Management Selling Stockholder; (iii) the Custody
Agreement dated as of December 16, 2004 (the "Custody Agreement") between Mellon
Investor Services LLC, as custodian, and the Management Selling Stockholder;
(iv) the factual certificates of the Management Selling Stockholder dated
December [22], 2004; and (v) such other documents, instruments and certificates
delivered by or on behalf of the Management Selling Stockholder and have
examined questions of law as we have deemed necessary in order to render this
opinion letter. We have relied on the representations of the Management Selling
Stockholder set forth in the Underwriting Agreement, Power of Attorney and
Custody Agreement and have not independently established any of the facts so
relied on.
For purposes of this opinion letter, we have made assumptions that are
customary in opinion letters of this kind, including the assumptions that each
document submitted to us is accurate and complete, that each such document that
is an original is authentic, that each such document conforms to an authentic
original, that all signatures on each such document are genuine, and that no
changes in the facts certified in the certificates set forth in the preceding
paragraph have occurred or will occur after the dates of such certificates. We
have further assumed the legal capacity of natural persons, and we have assumed
that each party to each document we have examined has the legal capacity and has
satisfied all legal requirements that are applicable to that party to the extent
necessary to make such document enforceable against that party. We have not
verified any of the foregoing assumptions. References in this opinion letter to
our knowledge or our attention mean a conscious awareness of facts by any of the
lawyers currently with this firm who have given substantive attention to legal
representation of the Company and the Management Selling Stockholder in matters
relating directly to the Underwriting Agreement, the Registration Statement
and the Prospectus (the "Transaction Lawyers") after consultation with such
other lawyers currently with this firm as deemed appropriate by the Transaction
Lawyers.
The opinions expressed in this opinion letter are limited to (i) the
law of the State of New York, other than its law relating to choice of law and
(ii) federal law of the United States. We are not opining on, and we assume no
responsibility with respect to, the applicability to or effect on any of the
matters covered herein of the laws of any other jurisdiction, or the laws of any
county, municipality or other political subdivision or local governmental agency
or authority.
Based on the foregoing, and subject to the foregoing and the additional
qualifications and other matters set forth below, it is our opinion that:
1. The Management Selling Stockholder has individual power and
authority to enter into the Underwriting Agreement, the Custody Agreement and
the Power of Attorney and to sell, assign, transfer and deliver the Shares
delivered by the Management Selling Stockholder on the date hereof.
2. The Underwriting Agreement has been duly executed and delivered on
behalf of the Management Selling Stockholder. A Power of Attorney and a Custody
Agreement have been duly executed and delivered by the Management Selling
Stockholder and constitute legal, valid and binding obligations of the
Management Selling Stockholder enforceable against the Management Selling
Stockholder in accordance with their respective terms, subject to bankruptcy,
insolvency, reorganization, fraudulent transfer, moratorium and other similar
laws of general applicability relating to or affecting creditors' rights
generally and by general equitable principles (whether considered in a
proceeding in equity or at law).
3. The Management Selling Stockholder is the registered owner of the
Shares to be sold; assuming the several Underwriters purchase the Shares
delivered by the Management Selling Stockholder for value and without notice of
any adverse claim, as such term is used in the Uniform Commercial Code as
currently in effect, the delivery of certificates representing such Shares will
pass to the Underwriters on the date hereof all rights in such Shares, free of
any adverse claims within the meaning of the Uniform Commercial Code as
currently in effect.
4. The execution, delivery and performance by the Management Selling
Stockholder of the Underwriting Agreement, the Custody Agreement and the Power
of Attorney and the sale of the Shares to be sold by the Management Selling
Stockholder thereunder will not result in a breach or violation of any of the
terms and provisions of, and will not constitute a default under, and will not
result in the creation or imposition of any lien, charge or encumbrance upon the
Shares to be sold by the Management Selling Stockholder under (A) any agreement
or instrument known to us to which the Management Selling Stockholder is a party
or by which the Management Selling Stockholder is bound or to which any of the
property or assets of the Management Selling Stockholder is subject, (B) any
federal statute, rule or regulation or existing law, rule or regulation
applicable to the Management Selling Stockholder, or (C) the terms of any
judgment, order or decree of any government, governmental agency or body, or
court having jurisdiction over the Management Selling Stockholder known to such
counsel that (1) names the Management Selling Stockholder and is specifically
directed to the Management Selling Stockholder or any of his property and (2)
expressly and adversely affects the title to the Shares to be sold by the
Management Selling Stockholder pursuant to the Underwriting Agreement or the
ability of the Management Selling Stockholder to perform his obligations under
the Underwriting Agreement, the Custody Agreement and the Power of Attorney,
except for such breaches, violations, defaults, liens, charges and encumbrances
which would not, individually or in the aggregate, have a material adverse
effect on the ability of the Management Selling Stockholder to consummate the
sale of the Shares by the Management Selling Stockholder or
perform the Management Selling Stockholder's obligations under the Underwriting
Agreement, the Custody Agreement and the Power of Attorney.
5. No consent, approval, authorization, order, registration or
qualification of, or filing with, any third party (whether acting in an
individual, fiduciary or other capacity) or any governmental or regulatory
agency or body or any court is required to be obtained or made by the Management
Selling Stockholder for the consummation of the sale of the Shares by the
Management Selling Stockholder and of the transactions contemplated by the
Underwriting Agreement, except such as have been obtained and made or are
required under the Securities Act and such as may be required under state
securities laws in connection with the sale or distribution of the Shares (as to
which we express no opinion).
We are furnishing this opinion letter to you solely in connection with
the sale of the Shares. You may not rely on this opinion letter in any other
connection, and it may not be furnished to or relied upon by any other person
for any purpose, without our specific prior written consent.
The foregoing opinions are rendered as of the date of this letter. We
assume no obligation to update or supplement any of such opinions to reflect any
changes of law or facts that may occur.
SCHEDULE I
NAME NUMBER OF SHARES
---- ----------------
Xxx X. Xxxxx 550,000
ANNEX 7(E)
FORM OF OPINION OF XXXXXXX XXXXXXX & XXXXXXXX LLP,
COUNSEL TO THE CYPRESS SELLING STOCKHOLDERS
December __, 2004
Xxxxxxx, Sachs & Co.
Xxxxxx Brothers Inc.
X.X. Xxxxxx Securities Inc.
UBS Securities LLC
Xxxxxx X. Xxxxx & Co. Incorporated
Bear, Xxxxxxx & Co. Inc.
c/o Goldman Xxxxx & Co.
00 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
We have acted as counsel to certain selling stockholders of WESCO
International, Inc., a Delaware corporation (the "Company") named in Schedule II
(the selling stockholders named therein are collectively referred to as the
"Selling Stockholders") to the Underwriting Agreement (as defined below), in
connection with the purchase by you of an aggregate of 10,000,000 shares of
Common Stock, $.01 par value (the "Shares"), of the Company, from the Company
and the Selling Stockholders pursuant to the Underwriting Agreement dated
December 16, 2004 among you (collectively, the "Underwriters"), the Company and
the Selling Stockholders (the "Underwriting Agreement").
We have examined the Registration Statement on Form S-3 (File No.
333-119909) filed by the Company under the Securities Act of 1933, as amended
(the "Securities Act"), as it became effective under the Securities Act (the
"Registration Statement"); the Company's prospectus dated December 6, 2004, as
supplemented by the prospectus supplement dated December 16, 2004 (the
"Prospectus"), filed by the Company pursuant to Rule 424(b) of the rules and
regulations of the Securities and Exchange Commission (the "Commission") under
the Securities Act, which pursuant to Form S-3 incorporates by reference or is
deemed to incorporate by reference the Company's Annual Report on Form 10-K for
the fiscal year ended December 31, 2003, the Company's Quarterly Reports on Form
10-Q for the periods ended March 31, 2004, June 30, 2004 and September 30, 2004,
the Company's Current Reports on Form 8-K, filed on July 15, 2004 and October
21, 2004 and the Company's Registration Statement on Form 8-A, filed on May 4,
1999, each as filed under the Securities Exchange Act of 1934, as amended; and
the Underwriting Agreement. We also have examined a copy of a certificate
representing the Common Stock of the Company. In addition, we have examined, and
have relied as to matters of fact upon, the documents delivered to you at the
closing and upon originals, or duplicates or certified or conformed copies, of
such corporate records, agreements, documents and other instruments and such
certificates or comparable documents or oral statements of public officials and
of officers and representatives of the Company and the Selling Stockholders, and
have made such other investigations, as we have deemed relevant and necessary in
connection with the opinions hereinafter set forth.
In such examination, we have assumed the genuineness of all signatures,
the legal capacity of natural persons, the authenticity of all documents
submitted to us as originals, the conformity to original documents of all
documents submitted to us as duplicates or certified or conformed copies and the
authenticity of the originals of such latter documents. In addition, in
connection with our
opinion set forth in paragraph 1 below, we have assumed that (i) The Depository
Trust Company ("DTC") is a "securities intermediary" as defined in Section 8-102
of the Uniform Commercial Code as in effect in the State of New York (the "New
York UCC"), and the State of New York is the "securities intermediary's
jurisdiction" of DTC for purposes of Section 8-110 of the New York UCC, (ii) the
Shares are registered in the name of DTC or its nominee, and DTC or another
person acting on behalf of DTC maintains possession of certificates representing
the Shares, (iii) DTC indicates by book entries on its books that security
entitlements with respect to the Shares have been credited to the Underwriters'
securities accounts and (iv) the Underwriters are purchasing the Shares without
notice of any adverse claim (within the meaning of the New York UCC).
In rendering the opinion set forth in paragraph 1 below, we have also
assumed that (i) Cypress Offshore Partners L.P. ("Cypress Offshore") is validly
existing and in good standing under the laws of the jurisdiction in which it is
organized and has duly authorized, executed and delivered the Underwriting
Agreement in accordance with its organizational documents and the laws of the
jurisdiction in which it is organized, (ii) execution, delivery and performance
by Cypress Offshore of the Underwriting Agreement does not the violate the laws
of the jurisdiction in which it is organized or any applicable jurisdiction
other than the State of New York and (iii) execution, delivery and performance
by Cypress Offshore of the Underwriting Agreement does not constitute a breach
or violation of any agreement or instrument which is binding upon Cypress
Offshore.
Based upon the foregoing, and subject to the qualifications,
assumptions and limitations stated herein, we are of the opinion that:
1. Cypress Merchant Banking Partners L.P. ("Cypress", and
together with Cypress Offshore, the "Cypress Selling Stockholders") has
full partnership power, right and authority to sell the Shares to be
sold by Cypress. Upon the payment and transfer contemplated by the
Underwriting Agreement, the Underwriters will acquire a security
entitlement with respect to the Shares to be sold by the Cypress
Selling Stockholders and no action based on an adverse claim may be
asserted against the Underwriters.
2. The Underwriting Agreement has been duly executed and
delivered by or on behalf of Cypress and by Cypress Associates L.P.,
the general partner of Cypress (the "General Partner").
3. The sale of the Shares by Cypress and the compliance by
Cypress with all of the provisions of the Underwriting Agreement will
not breach or result in a default under any indenture, mortgage, deed
of trust, loan agreement or other agreement or instrument identified on
the annexed schedule furnished to us by Cypress and which Cypress has
represented lists all material agreements and instruments to which
Cypress is a party or by which Cypress is bound, nor will such action
violate the organizational documents of Cypress or the General Partner
or any federal or New York State statute or the Delaware Revised
Uniform Limited Partnership Act or any rule or regulation that has been
issued pursuant to any federal or New York State statute or the
Delaware Revised Uniform Limited Partnership Act or any order known to
us issued pursuant to any federal or New York State statute or the
Delaware Revised Uniform Limited Partnership Act by any court or
governmental agency or body having jurisdiction over Cypress or the
General Partner or any of their respective properties.
4. No consent, approval, authorization, order, registration or
qualification of or with any federal or New York State governmental
agency or body or any Delaware governmental agency or body acting
pursuant to the Delaware Revised Uniform Limited Partnership Act or, to
our knowledge, any federal or New York State court or any Delaware
court acting pursuant to the Delaware Revised Uniform Limited
Partnership Act is required for the sale of the Shares by each of the
Cypress Selling Stockholders and the compliance by each of the Cypress
Selling Stockholders with all of the provisions of the Underwriting
Agreement, except for the registration under the Securities Act of the
Shares, and such consents, approvals, authorizations, registrations or
qualifications as may be required under state securities or Blue Sky
laws in connection with the purchase and distribution of the Shares by
the Underwriters.
We do not express any opinion herein concerning any law other than the
law of the State of New York, the federal law of the United States and the
Delaware Revised Uniform Limited Partnership Act.
This opinion letter is rendered to you in connection with the
above-described transaction. This opinion letter may not be relied upon by you
for any other purpose, or relied upon by, or furnished to, any other person,
firm or corporation without our prior written consent.
Very truly yours,
XXXXXXX XXXXXXX & XXXXXXXX LLP
ANNEX 7(F)
FORM OF OPINION OF WALKERS,
COUNSEL TO CYPRESS OFFSHORE PARTNERS L.P.
[Date] December 2004
To the persons set out in Schedule 4
Dear Sirs
CYPRESS OFFSHORE PARTNERS L.P (THE "PARTNERSHIP")
We have been asked to provide this legal opinion to you with regard to the laws
of the Cayman Islands pursuant to Section 7(f) of the Underwriting Agreement,
dated as of December 16, 2004 (the "Underwriting Agreement"), among WESCO
International, Inc., the selling stockholders named in Schedule II thereto and
the underwriters named in Schedule I thereto, being entered into by Cypress
Associates L.P. (the "COMPANY") as general partner of the Partnership, a Cayman
Islands Exempted Limited Partnership. The limited partners and founding limited
partners from time to time of the Partnership are collectively referred to in
this opinion as the "LIMITED PARTNERS" and references to the Partnership in this
opinion shall be deemed to be references to the Company in its capacity as
general partner of the Partnership, except where the context otherwise requires.
For the purposes of giving this opinion, we have examined and relied upon the
originals, copies or certified translations of the documents and instruments
listed in Schedule 1.
In giving this opinion we have relied upon the assumptions set out in Schedule
2, which we have not independently verified.
We are attorneys-at-law in the Cayman Islands and express no opinion as to any
laws other than the laws of the Cayman Islands in force and as interpreted at
the date of this opinion. We have not, for the purposes of this opinion, made
any investigation of the laws, rules or regulations of any other jurisdiction.
Except as explicitly stated herein, we express no opinion in relation to any
representation or warranty contained in the Underwriting Agreement nor upon the
commercial terms of the transactions contemplated by the Underwriting Agreement.
Based upon the foregoing examinations and assumptions and upon such searches as
we have conducted and having regard to legal considerations which we deem
relevant, and subject to the qualifications set out in Schedule 3 we are of the
opinion that under the laws of the Cayman Islands:
1. The Partnership is an exempted limited partnership duly formed,
registered, validly existing and in good standing under the laws of the
Cayman Islands. Based solely upon our review of the register of limited
partnership interests of the Partnership, the Company is the general
partner of the Partnership.
2. The Partnership has power and authority to purchase, own and dispose of
property and conduct its business as provided in the Partnership
Agreement (as defined in Schedule 1).
3. The Company is an exempted company duly incorporated, validly existing
and in good standing under the laws of the Cayman Islands. The Company
has full corporate power, and authority to execute and deliver the
Underwriting Agreement to be executed by it and to
perform its obligations under the Underwriting Agreement in its own
right and as general partner of the Partnership.
4. The execution, delivery and performance of the Underwriting Agreement
to which the Partnership is a party or to which the Company is a party,
as general partner of the Partnership , and the consummation of the
transactions contemplated thereby and the compliance by the Company and
the Partnership with the terms and provisions thereof, including the
sale by the Partnership of up to 334,432 shares, $.01 par value, of
WESCO International, Inc. (the "Shares") pursuant to the terms of the
Underwriting Agreement, do not:
(a) contravene any law, public rule or regulation of the Cayman
Islands applicable to the Company or the Partnership which is
currently in force;
(b) contravene the Memorandum and Articles of Association of the
Company; or
(c) contravene the Partnership Agreement of the Partnership.
5. Neither the execution, delivery or performance of the Underwriting
Agreement to which the Company or the Partnership is a party nor the
consummation or performance of any of the transactions contemplated
thereby by the Company or the Partnership, including the sale of the
Shares pursuant to the Underwriting Agreement, requires the consent or
approval of, the giving of notice to, or the registration with, or the
taking of, any other action in respect of any Cayman Islands
governmental or judicial authority or agency.
6. The Underwriting Agreement to which the Partnership is a party has been
duly authorised, executed and delivered by the Company as general
partner of the Partnership and constitutes the legal, valid and binding
obligations of the Partnership enforceable against the Partnership in
accordance with their respective terms.
7. The law chosen in the Underwriting Agreement to govern its
interpretation would be upheld as a valid choice of law in any action
on the Underwriting Agreement in the courts of the Cayman Islands.
8. There are no stamp duties (other than the stamp duties mentioned in
qualification 2 in Schedule 3), income taxes, withholdings, levies,
registration taxes, or other duties or similar taxes or charges now
imposed, or which under the present laws of the Cayman Islands could in
the future become imposed, in connection with the enforcement or
admissibility in evidence of the Underwriting Agreement, activities of
the Partnership contemplated by the Underwriting Agreement or on any
payment or distribution to be made by the Company, or the Partnership,
or any other person pursuant to the Underwriting Agreement. The Cayman
Islands currently have no form of income, corporate or capital gains
tax and no estate duty, inheritance tax or gift tax.
9. None of the parties to the Underwriting Agreement (other than the
Company and the Partnership) is or will be deemed to be resident,
domiciled or carrying on business in the Cayman Islands by reason only
of the execution, delivery, performance or enforcement of the
Underwriting Agreement to which any of them is party.
10. A judgment obtained in a foreign court will be recognised and enforced
in the courts of the Cayman Islands without any re-examination of the
merits at common law, by an action commenced on the foreign judgment
debt in the Grand Court of the Cayman Islands, where
the judgment is final and in respect of which the foresign court had
jurisdiction over the defendant according to Cayman Islands conflict of
law rules and which is conclusive, for a liquidated sum not in respect
of penalties or taxes or a fine or similar fiscal or revenue
obligations, and which was neither obtained in a manner, nor is of a
kind enforcement of which is contrary to natural justice or the public
policy of the Cayman Islands.
11. It is not necessary under the laws of the Cayman Islands (i) in order
to enable any party to the Underwriting Agreement to enforce their
rights under the Underwriting Agreement or (ii) solely by reason of the
execution, delivery and performance of the Underwriting Agreement that
any party to the Underwriting Agreement should be licensed, qualified
or otherwise entitled to carry on business in the Cayman Islands or any
other political subdivision thereof.
12. The Company and the Partnership are subject to civil and commercial law
with respect to their obligations under the Underwriting Agreement and
neither the Company nor the Partnership nor any of their assets are
entitled to immunity from suit or enforcement of a judgment on the
grounds of sovereignty or otherwise in the courts of the Cayman Islands
in proceedings against the Company or the Partnership in respect of any
obligations under the Underwriting Agreement, which obligations
constitute private and commercial acts rather than governmental or
public acts.
13. Based solely upon our examination of the Cause List and the Register of
Writs and other Originating Process of the Grand Court of the Cayman
Islands conducted on [date] December 2004 (the "SEARCH DATE"), we
confirm that there are no actions, suits or proceedings pending against
the Company or the Partnership before the Grand Court of the Cayman
Islands and no steps have been, or are being, taken to compulsorily
wind up the Company or dissolve the Partnership and based solely upon
our examination of the records of the Company referred to in this
opinion no resolution voluntarily to wind up the Company has been
adopted by its members.
14. A judgment of a court in the Cayman Islands may be expressed in a
currency other than Cayman Islands dollars.
This opinion is limited to the matters referred to herein and shall not be
construed as extending to any other matter or document not referred to herein.
This opinion is given solely for your benefit and the benefit of your legal
advisers acting in that capacity in relation to this transaction, and may not be
relied upon by any other person without our prior written consent.
This opinion shall be construed in accordance with the laws of the Cayman
Islands.
Yours faithfully
WALKERS
SCHEDULE 1
LIST OF DOCUMENTS EXAMINED
1. The Certificate of Incorporation of the Company dated [date], the
Memorandum and Articles of Association of the Company as registered on
[date], the Minute Book, the Register of Members, Register of Directors
and Register of Officers, and the Register of Mortgages and Charges of
the Company copies of which have been provided to us by its registered
office in the Cayman Islands;
2. the Cause List and Register of Writs and other Originating Process of
the Grand Court of the Cayman Islands kept at the Clerk of Courts
Office, Xxxxxx Town, Grand Cayman as at [time] [a.m. / p.m.], Cayman
Islands time, on the Search Date;
3. a Certificate of Good Standing dated [date] December 2004 in respect of
the Company issued by the Registrar of Companies and a Certificate of
Good Standing dated [date] December 2004 in respect of the Partnership
issued by the Registrar of Exempted Limited Partnerships;
4. a copy of the executed Partnership Agreement dated [date] between
[Parties] and the Company (the "PARTNERSHIP AGREEMENT");
5. the Certificate of Registration of the Partnership dated [2 August
1995] issued by the Registrar of Exempted Limited Partnerships, the
Register of Limited Partnership Interests and the Register of Mortgages
of Limited Partnership Interests copies of which have been provided to
us by the Partnership's registered office in the Cayman Islands;
6. a copy of the [written resolutions / minutes of a meeting] of the Board
of Directors of the Company dated [date] December 2004 (the
"RESOLUTIONS");
7. a copy of the Underwriting Agreement, dated as of December 16, 2004,
among WESCO International, Inc., the selling stockholders named in
Schedule II thereto (including the Partnership) and the underwriters
named in Schedule I thereto.
SCHEDULE 2
ASSUMPTIONS
This opinion is given based upon the following assumptions:
1. There are no provisions of the laws of any jurisdiction outside the Cayman
Islands which would be contravened by the execution or delivery of the
Underwriting Agreement and insofar as any obligation expressed to be incurred
under the Underwriting Agreement is to be performed in or is otherwise subject
to the laws of any jurisdiction outside the Cayman Islands, its performance will
not be illegal by virtue of the laws of that jurisdiction.
2. The Underwriting Agreement is within the capacity, power, and legal right of
and have been or will be duly authorised, executed and delivered by, each of the
parties thereto (other than the Company and the Partnership) and constitute or
when executed and delivered, will constitute the legal, valid and binding
obligations of each of the parties thereto enforceable in accordance with their
terms as a matter of the laws of all other relevant jurisdictions (other than
the Cayman Islands).
3. The choice of the laws of the jurisdiction selected to govern the
Underwriting Agreement has been made in good faith and will be regarded as a
valid and binding selection that will be upheld in the courts of that
jurisdiction and all other relevant jurisdictions (other than the Cayman
Islands).
4. All authorisations, approvals, consents, licences and exemptions required by,
and all filings and other requirements of, each of the parties to the
Underwriting Agreement outside the Cayman Islands to ensure the legality,
validity and enforceability of the Underwriting Agreement has been or will be
duly obtained, made or fulfilled and are and will remain in full force and
effect and any conditions to which they are subject have been satisfied.
5. All conditions precedent, if any, contained in the Underwriting Agreement
have been or will be satisfied or waived.
6. The board of directors of the Company consider the execution of the
Underwriting Agreement and the transactions contemplated thereby to be in the
best interests of the Company and the Partnership.
7. No disposition of property effected by the Underwriting Agreement is made for
an improper purpose or wilfully to defeat an obligation owed to a creditor and
at an undervalue.
8. Each of the Company and the Partnership was on the date of execution of the
Underwriting Agreement to which it is a party able to pay its debts as they
became due from its own moneys, and any disposition or settlement of property
effected by the Underwriting Agreement is made in good faith and for valuable
consideration and at the time of each disposition of property by the Company and
the Partnership pursuant to the Underwriting Agreement the Company will be able
to pay its debts and those of the Partnership as they become due from its own
moneys or those of the Partnership, as the case may be.
9. The originals of all documents examined in connection with this opinion are
authentic, all seals thereon and the signatures and initials thereon of any
person authorised to execute the Underwriting Agreement are genuine, all such
documents purporting to be sealed have been so sealed, all copies are complete
and conform to their originals.
10. The Memorandum and Articles of Association reviewed by us are the Memorandum
and Articles of Association of the Company in force at the date hereof and the
Partnership Agreement reviewed by us is the Partnership Agreement of the
Partnership in force at the date hereof and each of the parties to the
Partnership Agreement has duly executed and delivered the same.
11. The copies of the Minute Book, Register of Members, Register of Directors
and Register of Officers, Register of Mortgages and Charges, Certificate of
Incorporation, and Memorandum and Articles of Association of the Company
provided to us by its registered office are true and correct copies of the
originals of the same and are complete and accurate and constitute a complete
and accurate record of the business transacted by the Company and all matters
required by law and the Memorandum and Articles of Association of the Company to
be recorded therein are so recorded.
12. The Partnership records, including the Certificate of Registration of the
Partnership, the Register of Limited Partnership Interests and the Register of
Mortgages of Limited Partnership Interests, provided to us by its registered
office are true and accurate copies of the originals of the same and are
complete and accurate and constitute a complete and accurate record of the
business transacted by the Partnership and all matters required by law to be
recorded therein are so recorded and include complete copies of all matters
required by law to be filed with the Registrar of Exempted Limited Partnerships.
13. The Cause List and the Register of Writs and other Originating Process of
the Grand Court of the Cayman Islands examined by us at the Clerk of Courts
Office, Xxxxxx Town, Grand Cayman at [time] [a.m. / p.m.], Cayman Islands time,
on the Search Date, covering the period six years prior to the date of search
constitute a complete record of the proceedings before the Grand Court of the
Cayman Islands.
14. No withdrawal, removal or deemed act of withdrawal or removal of a general
partner of the Partnership has taken place. We confirm that nothing in the
materials examined by us suggests that any such event has taken place.
15. The meeting of the board of directors at which the Resolutions were duly
adopted was called and held in accordance with the Articles of Association of
the Company.
16. No action or event (including the expiry of a time period) has taken place
that causes the dissolution of the Partnership.
SCHEDULE 3
QUALIFICATIONS
This opinion is given subject to the following qualifications:
1. The term "ENFORCEABLE" and its cognates as used in this opinion means that
the obligations assumed by the Company and the Partnership under the
Underwriting Agreement are of a type that the courts of the Cayman Islands
enforce. This does not mean that those obligations will necessarily be enforced
in all circumstances in accordance with their terms. In particular:
(a) enforcement of obligations and the priority of obligations may
be limited by bankruptcy, insolvency, liquidation,
reorganisation, readjustment of debts or moratorium and other
laws of general application relating to or affecting the
rights of creditors or by prescription or lapse of time;
(b) enforcement may be limited by general principles of equity and
in particular the availability of certain equitable remedies
such as injunction or specific performance of an obligation
may be limited where the court considers damages to be an
adequate remedy;
(c) claims may become barred under statutes of limitation or may
be or become subject to defences of set-off, counterclaim,
estoppel and similar defences;
(d) where obligations are to be performed in a jurisdiction
outside the Cayman Islands, they may not be enforceable in the
Cayman Islands to the extent that performance would be illegal
under the laws of, or contrary to the public policy of, that
jurisdiction;
(e) a judgment of a court of the Cayman Islands may be required to
be made in Cayman Islands dollars;
(f) to the extent that any provision of the Underwriting Agreement
is adjudicated to be penal in nature (including, without
limitation, any provision for the forfeiture or transfer of
all or any part of a limited partner's partnership interest
following such limited partner's default) it will not be
enforceable in the courts of the Cayman Islands; in
particular, the enforceability of any provision of the
Underwriting Agreement which imposes additional obligations in
the event of any breach or default, or of payment or
prepayment being made other than on an agreed date, may be
limited to the extent that it is subsequently adjudicated to
be penal in nature and not an attempt to make a reasonable
pre-estimate of loss;
(g) to the extent that the performance of any obligation arising
under the Underwriting Agreement would be fraudulent or
contrary to public policy, it will not be enforceable in the
courts of the Cayman Islands;
(h) a Cayman Islands court will not necessarily award costs in
litigation in accordance with contractual provisions in this
regard; and
(i) the effectiveness of terms in the Underwriting Agreement
excusing any party from a liability or duty otherwise owed or
indemnifying that party from the consequences of incurring
such liability or breaching such duty shall be construed in
accordance with,
and shall be limited by, applicable law, including generally
applicable rules and principles of common law and equity.
2. Cayman Islands stamp duty will be payable if the Underwriting Agreement is
executed in, brought to, or produced before a court of the Cayman Islands. Such
duty would be nominal except in the case of:
(a) a debenture or a legal or equitable mortgage or charge of immovable
property:
(i) where the sum secured is CI$300,000 (US$360,000) or
less, in which case duty would be 1% of the sum
secured; or
(ii) where the sum secured is more than CI$300,000
(US$360,000) whether initially or after further
advance, in which case duty would be 1.5% of the sum
secured; or
(b) a legal or equitable mortgage or charge of movable property (not
including a debenture but including a xxxx of sale) in which case duty
would be 1.5% of the sum secured;
PROVIDED THAT no duty shall be payable where the property is
situated outside the Cayman Islands and that in the case of a
legal or equitable mortgage or charge granted by an exempted
company, an ordinary non-resident company (as defined in the
Companies Law (as amended)) or an exempted trust (as defined
in the Trusts Law (as amended)) or a body corporate
incorporated outside the Cayman Islands of movable property
situated in the Cayman Islands or over shares in such exempted
company or an ordinary non-resident company, the maximum duty
payable shall be CI$500.00 (US$600.00); or
(c) any note evidencing indebtedness, in which case duty of CI$0.25 per
CI$100 or part thereof of the face value of each note, subject to a
maximum of CI$250, is payable, unless, the notes are issued as part of
a series by an exempted company or by an ordinary non-resident company
(as defined in the Companies Law (as amended)) or by a body corporate
incorporated outside the Cayman Islands, in which case a duty of CI$500
in respect of the instrument creating the notes may be paid and
thereafter no further stamp duty in respect of such notes is payable.
2. A certificate, determination, calculation or designation of any party to the
Underwriting Agreement as to any matter provided therein might be held by a
Cayman Islands court not to be conclusive, final and binding, notwithstanding
any provision to that effect therein contained, for example, if it could be
shown to have an unreasonable, arbitrary or improper basis or in the event of
manifest error.
3. If any provision of the Underwriting Agreement is held to be illegal, invalid
or unenforceable, severance of such provision from the remaining provisions will
be subject to the discretion of the Cayman Islands courts notwithstanding any
express provisions in this regard.
4. In principle, a person who claims to be entitled pursuant to a contract to
recover the legal fees and expenses incurred in enforcing that contract shall be
entitled to judgment for the amount of legal fees and expenses found due under
the contract and such amount shall not be subject to taxation pursuant to the
applicable rule of court. However, the applicable rule (GCR Order 62, rule 4(3))
has
been in force only since January 1, 2002 and there remains some uncertainty as
to the way in which it will be applied in practice.
5. A conveyance, mortgage, charge or other security interest granted or made by
a company at a time when that company was unable to pay its debts as they fell
due, and made or granted in favour of a creditor with a dominant intention to
give that creditor a preference over the other creditors of the company, would
be void pursuant to Section 168(1) of the Companies Law (as amended), if within
6 months thereof a petition is presented to the Grand Court of the Cayman
Islands for the winding-up of such company, or a resolution is passed for the
voluntary winding-up of the company.
6. Under the Fraudulent Dispositions Law 1989, any disposition of property made
with an intent to defraud (which means an intention by the party disposing of
the property to wilfully defeat an obligation owed to a creditor) and at an
undervalue, shall be voidable at the instance of the creditor thereby
prejudiced.
7. We express no opinion upon the effectiveness of any clause of the
Underwriting Agreement providing that the terms of such Underwriting Agreement
may only be amended in writing.
8. Notwithstanding any purported date of execution in the Underwriting
Agreement, the rights and obligations therein contained take effect only on the
actual execution and delivery thereof but the Underwriting Agreement may provide
that they have retrospective effect as between the parties thereto alone.
9. The obligations of the Company and the obligations of the Partnership may be
subject to restrictions pursuant to United Nations sanctions ("Sanctions")
extended to the Cayman Islands by the Order of Her Majesty in Council. At this
date, Sanctions currently extend to Iraq, Sierra Leone, Liberia, Somalia,
Rwanda, Afghanistan, the Taliban (an Afghan political faction which calls itself
the Islamic Emirate of Afghanistan) and The Democratic Republic of the Congo.
10. Persons who are not party to the Underwriting Agreement (other than
beneficiaries under properly constituted trusts or persons acting pursuant to
powers contained in a deed poll) under Cayman Islands law have no direct rights
or obligations under such Underwriting Agreement.
11. A limited partner of the Partnership receiving from the Partnership a
payment representing a return of contribution at any time when the Partnership
is not solvent, shall, in the event of the insolvency of the Partnership within
a period of six months from the date of such payment, be liable to repay the
amount of such payment plus statutory interest.
12. Entry of particulars of a mortgage or charge in the Register of Mortgages
and Charges of the mortgagor or chargor may not of itself give that mortgage or
charge priority in ranking over any mortgage, charge or lien existing prior to
its creation.
13. Any charge in the nature of a floating charge will not take priority in
ranking over any subsequent fixed mortgage or charge or lien which is created
prior to the crystallisation of the floating charge.
14. A mortgage or charge may not rank prior to a subsequent mortgage, charge or
lien in respect of indebtedness incurred after the first mortgagee or chargee
has notice of the subsequent mortgage, charge or lien.
15. We render no opinion as to the specific enforcement as against the Company
of covenants granted by the Company to do or to omit to do any action or other
matter which is reserved by applicable law, or the Company's constitutional
documents, to the Company's shareholders or any other person.
16. To maintain the Company and the Partnership in good standing under the laws
of the Cayman Islands, annual filing fees must be paid and returns made to (as
appropriate) the Registrar of Companies and the Registrar of Exempted Limited
Partnerships.
17. We express no opinion upon the references to any law or statute not being a
Cayman Islands law or statute in the Partnership Agreement.
SCHEDULE 4
ADDRESSEES
Xxxxxxx, Xxxxx & Co.,
Xxxxxx Brothers Inc.,
X.X. Xxxxxx Securities Inc.,
UBS Securities LLC,
Xxxxxx X. Xxxxx & Co. Incorporated,
Bear, Xxxxxxx & Co. Inc.,
c/o Goldman, Sachs & Co.,
00 Xxxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000.
ANNEX 7(G)(I)
Pursuant to Section 7(g) of the Underwriting Agreement, the accountants
shall furnish letters to the Underwriters to the effect that:
(i) They are independent registered public accounting firm
with respect to the Company and its subsidiaries within the meaning of
the Act and the applicable published rules and regulations thereunder
adopted by the Securities and Exchange Commission (SEC) and the Public
Company Accounting Oversight Board (United States) (PCAOB);
(ii) In their opinion, the financial statements and any
supplementary financial information and schedules (and, if applicable,
financial forecasts and/or pro forma financial information) examined by
them and included or incorporated by reference in the Registration
Statement or the Prospectus comply as to form in all material respects
with the applicable accounting requirements of the Act or the Exchange
Act, as applicable, and the related published rules and regulations
thereunder; and, if applicable, they have made a review in accordance
with standards established by the PCAOB for a review of interim
financial information as described in SAS No. 100, Interim Financial
Information, on the consolidated interim financial statements, selected
financial data, pro forma financial information, financial forecasts
and/or condensed financial statements derived from audited financial
statements of the Company for the periods specified in such letter, as
indicated in their reports thereon, copies of which have been
separately furnished to the representatives of the Underwriters (the
"Representatives");
(iii) They have made a review in accordance with standards
established by the PCAOB for a review of interim financial information
as described in SAS No. 100, Interim Financial Information, on the
unaudited condensed consolidated statements of income, consolidated
balance sheets and consolidated statements of cash flows included in
the Prospectus and/or included in the Company's quarterly report on
Form 10-Q incorporated by reference into the Prospectus as indicated in
their reports thereon copies of which have been separately furnished to
the Representatives; and on the basis of specified procedures including
inquiries of officials of the Company who have responsibility for
financial and accounting matters regarding whether the unaudited
condensed consolidated financial statements referred to in paragraph
(vi)(A)(i) below comply as to form in all material respects with the
applicable accounting requirements of the Act and the Exchange Act and
the related published rules and regulations, nothing came to their
attention that caused them to believe that the unaudited condensed
consolidated financial statements do not comply as to form in all
material respects with the applicable accounting requirements of the
Act and the Exchange Act and the related published rules and
regulations;
(iv) The unaudited selected financial information with respect
to the consolidated results of operations and financial position of the
Company for the five most recent fiscal years included in the
Prospectus and included or incorporated by reference in Item 6 of the
Company's Annual Report on Form 10-K for the most recent fiscal year
agrees with the corresponding amounts (after restatement where
applicable) in the audited consolidated financial statements for such
five fiscal years which were included or incorporated by reference in
the Company's Annual Reports on Form 10-K for such fiscal years;
(v) They have compared the information in the Prospectus under
selected captions with the disclosure requirements of Regulation S-K
and on the basis of limited procedures specified in such letter nothing
came to their attention as a result of the foregoing procedures that
caused them to believe that this information does not conform in all
material respects with the disclosure requirements of Items 301, 302,
402 and 503(d), respectively, of Regulation S-K;
(vi) On the basis of limited procedures, not constituting an
examination in accordance with PCAOB standards, consisting of a reading
of the unaudited financial statements and other information referred to
below, a reading of the latest available interim financial statements
of the Company and its subsidiaries, inspection of the minute books of
the Company and its subsidiaries since the date of the latest audited
financial statements included or incorporated by reference in the
Prospectus, inquiries of officials of the Company and its subsidiaries
responsible for financial and accounting matters and such other
inquiries and procedures as may be specified in such letter, nothing
came to their attention that caused them to believe that:
(A) (i) the unaudited condensed consolidated
statements of income, consolidated balance sheets and
consolidated statements of cash flows included in the
Prospectus and/or included or incorporated by reference in the
Company's Quarterly Reports on Form 10-Q incorporated by
reference in the Prospectus do not comply as to form in all
material respects with the applicable accounting requirements
of the Exchange Act and the related published rules and
regulations, or (ii) any material modifications should be made
to the unaudited condensed consolidated statements of income,
consolidated balance sheets and consolidated statements of
cash flows included in the Prospectus or included in the
Company's Quarterly Reports on Form 10-Q incorporated by
reference in the Prospectus, for them to be conformity with
generally accepted accounting principles;
(B) any other unaudited income statement data and
balance sheet items included in the Prospectus do not agree
with the corresponding items in the unaudited consolidated
financial statements from which such data and items were
derived, and any such unaudited data and items were not
determined on a basis substantially consistent with the basis
for the corresponding amounts in the audited consolidated
financial statements included or incorporated by reference in
the Company's Annual Report on Form 10-K for the most recent
fiscal year;
(C) the unaudited financial statements which were not
included in the Prospectus but from which were derived the
unaudited condensed financial statements referred to in clause
(A) and any unaudited income statement data and balance sheet
items included in the Prospectus and referred to in clause (B)
were not determined on a basis substantially consistent with
the basis for the audited financial statements included or
incorporated by reference in the Company's Annual Report on
Form 10-K for the most recent fiscal year;
(D) any unaudited pro forma consolidated condensed
financial statements included or incorporated by reference in
the Prospectus do not comply as to form in all material
respects with the applicable accounting requirements of the
Act and the published rules and regulations thereunder or the
pro forma adjustments have not been properly applied to the
historical amounts in the compilation of those statements;
(E) as of a specified date not more than five days
prior to the date of such letter, there have been any changes
in the consolidated capital stock (other than issuances of
capital stock upon exercise of options and stock appreciation
rights, upon earn-outs of performance shares and upon
conversions of convertible securities, in each case which were
outstanding on the date of the latest balance sheet included
or incorporated by reference in the Prospectus) or any
increase in the consolidated long-term debt of the Company and
its subsidiaries, or any decreases in consolidated net current
assets or stockholders' equity or other items specified by the
Representatives, or any increases in any items specified by
the Representatives, in each case as compared with amounts
shown in the latest balance sheet included or incorporated by
reference in the Prospectus, except in each case for changes,
increases or decreases which the Prospectus discloses have
occurred or may occur or which are described in such letter;
and
(F) for the period from the date of the latest
financial statements included or incorporated by reference in
the Prospectus to the specified date referred to in clause (E)
there were any decreases in consolidated net revenues or
operating profit or the total or per share amounts of
consolidated net income or other items specified by the
Representatives, or any increases in any items specified by
the Representatives, in each case as compared with the
comparable period of the preceding year and with any other
period of corresponding length specified by the
Representatives, except in each case for increases or
decreases which the Prospectus discloses have occurred or may
occur or which are described in such letter; and
(vii) In addition to the examination referred to in their
report(s) included or incorporated by reference in the Prospectus and
the limited procedures, inspection of minute books, inquiries and other
procedures referred to in paragraphs (iii) and (vi) above, they have
carried out certain specified procedures, not constituting an
examination in accordance with PCAOB standards, with respect to certain
amounts, percentages and financial information specified by the
Representatives which are derived from the general accounting records
of the Company and its subsidiaries, which appear in the Prospectus
(excluding documents incorporated by reference) or in Part II of, or in
exhibits and schedules to, the Registration Statement specified by the
Representatives or in documents incorporated by reference in the
Prospectus specified by the Representatives, and have compared certain
of such amounts, percentages and financial information with the
accounting records of the Company and its subsidiaries and have found
them to be in agreement.
ANNEX 7(G)(II)
COMFORT LETTER DELIVERED PRIOR TO THE EXECUTION OF UNDERWRITING AGREEMENT
ANNEX 7(G)(III)
FORM OF COMFORT LETTER TO BE DELIVERED ON THE EFFECTIVE DATE
OF ANY POST-EFFECTIVE AMENDMENT TO THE REGISTRATION STATEMENT
AND ON EACH TIME OF DELIVERY
ANNEX 7(L)(I)
FORM OF LOCK-UP AGREEMENT
December __, 2004
Xxxxxxx, Xxxxx & Co.,
Xxxxxx Brothers Inc.,
X.X. Xxxxxx Securities Inc.,
UBS Securities LLC,
Xxxxxx X. Xxxxx & Co. Incorporated,
Bear, Xxxxxxx & Co. Inc.,
c/o Goldman, Sachs & Co.
00 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Re: WESCO International, Inc. - Lock-Up Agreement
Ladies and Gentlemen:
The undersigned understands that you, as representatives (the
"Representatives"), propose to enter into an Underwriting Agreement on behalf of
the several Underwriters named in Schedule I to such agreement (collectively,
the "Underwriters"), with WESCO International, Inc., a Delaware corporation (the
"Company"), and the Selling Stockholders named therein (the "Underwriting
Agreement"), providing for a public offering of the Common Stock, $.01 par
value, of the Company (the "Shares") pursuant to a Registration Statement on
Form S-3 (No. 333-119909) filed with the Securities and Exchange Commission (the
"SEC").
In consideration of the agreement by the Underwriters to offer and sell
the Shares, and of other good and valuable consideration the receipt and
sufficiency of which is hereby acknowledged, the undersigned agrees that, during
the period specified in the following paragraph (the "Lock-up Period"), the
undersigned will not offer, sell, contract to sell, pledge, grant any option to
purchase, make any short sale or otherwise dispose of any shares of Common Stock
of the Company, or any options or warrants to purchase any shares of Common
Stock of the Company, or any securities convertible into, exchangeable for or
that represent the right to receive shares of Common Stock of the Company,
whether now owned or hereinafter acquired, owned directly by the undersigned
(including holding as a custodian) or with respect to which the undersigned has
beneficial ownership within the rules and regulations of the SEC (collectively
the "Undersigned's Shares"). The foregoing restriction is expressly agreed to
preclude the undersigned from engaging in any hedging or other transaction which
is designed to or which reasonably could be expected to lead to or result in a
sale or disposition of the Undersigned's Shares even if such Shares would be
disposed of by someone other than the undersigned. Such prohibited hedging or
other transactions would include without limitation any short sale or any
purchase, sale or grant of any right (including without limitation any put or
call option) with respect to any of the Undersigned's Shares or with respect to
any security that includes, relates to, or derives any significant part of its
value from such Shares.
The initial Lock-up Period will commence on the date of this Lock-up
Agreement and continue for 90 days after the public offering date set forth on
the final prospectus used to sell the Shares (the "Public Offering Date")
pursuant to the Underwriting Agreement; provided, however, that if (1) during
the last 17 days of the initial Lock-up Period the
Company releases earnings results or announces material news or a material event
or (2) prior to the expiration of the initial Lock-up Period the Company
announces that it will release earnings results during the 16-day period
beginning on the last day of the initial Lock-up Period, then in each case the
Lock-up Period will be automatically extended until the expiration of the 18-day
period beginning on the date of release of the earnings results or the
announcement of the material news or material event, as applicable, unless
Xxxxxxx, Xxxxx & Co. and Xxxxxx Brothers Inc. waive in writing, such extension.
The undersigned hereby acknowledges and agrees that the Company has
agreed in the Underwriting Agreement to provide written notice of any event that
would result in an extension of the Lock-up Period pursuant to the previous
paragraph to the undersigned and that any such notice properly delivered will be
deemed to have given to, and received by, the undersigned. The undersigned
hereby further agrees that, prior to engaging in any transaction or taking any
other action that is subject to the terms of this Lock-up Agreement during the
period from the date of this Lock-up Agreement to and including the 34th day
following the expiration of the initial Lock-up Period, it will give notice
thereof to the Company and will not consummate such transaction or take any such
action unless it has received written confirmation from the Company that the
Lock-up Period (as may have been extended pursuant to the previous paragraph)
has expired.
Notwithstanding the foregoing, the undersigned may transfer the
Undersigned's Shares (i) as a bona fide gift or gifts, provided that the donee
or donees thereof agree to be bound in writing by the restrictions set forth
herein, (ii) to any trust for the direct or indirect benefit of the undersigned
or the immediate family of the undersigned, provided that the trustee of the
trust agrees to be bound in writing by the restrictions set forth herein, and
provided further that any such transfer shall not involve a disposition for
value, or (iii) with the prior written consent of Xxxxxxx, Xxxxx & Co. and
Xxxxxx Brothers Inc. on behalf of the Underwriters. For purposes of this Lock-Up
Agreement, "immediate family" shall mean any relationship by blood, marriage or
adoption, not more remote than first cousin. In addition, notwithstanding the
foregoing, if the undersigned is a corporation, the corporation may transfer the
capital stock of the Company to any wholly-owned subsidiary of such corporation;
provided, however, that in any such case, it shall be a condition to the
transfer that the transferee execute an agreement stating that the transferee is
receiving and holding such capital stock subject to the provisions of this
Agreement and there shall be no further transfer of such capital stock except in
accordance with this Agreement, and provided further that any such transfer
shall not involve a disposition for value. The undersigned now has, and, except
as contemplated by clause (i), (ii), or (iii) above, for the duration of this
Lock-Up Agreement will have, good and marketable title to the Undersigned's
Shares, free and clear of all liens, encumbrances, and claims whatsoever. The
undersigned also agrees and consents to the entry of stop transfer instructions
with the Company's transfer agent and registrar against the transfer of the
Undersigned's Shares except in compliance with the foregoing restrictions.
The undersigned understands that the Company and the Underwriters are
relying upon this Lock-Up Agreement in proceeding toward consummation of the
offering. The undersigned further understands that this Lock-Up Agreement is
irrevocable and shall be binding upon the undersigned's heirs, legal
representatives, successors, and assigns.
Very truly yours,
----------------------------------------
Exact Name
----------------------------------------
Authorized Signature
----------------------------------------
Title
ANNEX 7(L)(II)
LIST OF DIRECTORS, EXECUTIVE OFFICERS AND SELLING STOCKHOLDERS
DELIVERING LOCK-UP AGREEMENT
EXECUTIVE OFFICERS
Xxx X. Xxxxx
Xxxx Xxxxx
Xxxxxxx X. Van Oss
Xxxxxxx X. Xxxxxxx
Xxxxx X. Xxxxx
Xxxxxx X. Xxxxxxxxx
Xxxxxxx X. Xxxx
Xxxxxx X. Xxxxxxx
Xxxxxx X. Van, Jr.
DIRECTORS
Xxx X. Xxxxx
Xxxxxx Beach Xxx
Xxxxxxx X. Xxxxxxxx
Xxxxxx X. Xxxxx, Xx.
Xxxxx X. Xxxxxxxxx
Xxxxx X. Xxxxx
Xxxxxx X. Xxxx, Xx.
Xxxxxxx X. Xxxxxxxx
Xxxxxxx X. Way
SELLING STOCKHOLDERS
Cypress Merchant Banking Partners L.P.
Cypress Offshore Partners L.P.
Xxx X. Xxxxx
