Exhibit 1.1
10,000,000 SHARES
XXXXXXXXXXX INTERNATIONAL LTD.
COMMON SHARES
PURCHASE AGREEMENT
June 30, 2003
XXXXXX BROTHERS INC.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Xxxxxxxxxxx International Ltd., a Bermuda exempted company
(the "COMPANY"), proposes to sell 10,000,000 shares (the "FIRM SHARES") of the
Company's Common Shares, par value U.S.$1.00 per share (the "COMMON SHARES").
It is understood that, subject to the conditions hereinafter
stated, all of the Firm Shares will be sold to Xxxxxx Brothers Inc. (the
"UNDERWRITER"). In addition, the Company proposes to grant to the Underwriter an
option to purchase up to an additional 1,500,000 Common Shares on the terms and
for the purposes set forth in Section 3 (the "OPTION SHARES"). The Firm Shares
and the Option Shares, if purchased, are hereinafter collectively called the
"SHARES." This is to confirm the agreement concerning the purchase of the Shares
from the Company by the Underwriter.
SECTION 1. Representations, Warranties and Agreements of the Company.
The Company represents, warrants and agrees that:
(a) The Company has filed with the Securities and Exchange
Commission (the "COMMISSION") a registration statement on Form S-3 (No.
333-100588), for the registration of the Shares under the Securities Act of
1933, as amended (the "SECURITIES ACT"), and the offering thereof from time to
time in accordance with Rule 430A or Rule 415 of the rules and regulations
promulgated by the Commission (the "RULES AND REGULATIONS"), and the Company has
filed such post-effective amendments thereto as may be required prior to the
execution of this Agreement. Such registration statement (as so amended, if
applicable) was declared effective by the Commission on October 28, 2002. Such
registration statement (as so amended, if applicable), including the
information, if any, deemed to be a part thereof pursuant to Rule 430A(b) of the
Rules and Regulations (the "RULE 430A INFORMATION") or Rule 434(d) of the Rules
and Regulations (the "RULE 434 INFORMATION"), is referred to herein as the
"REGISTRATION STATEMENT"; and the final prospectus and the prospectus supplement
relating to the offering of the Shares, in the form first furnished to the
Underwriter by the Company for use in connection with the offering of the
Shares, are collectively referred to herein as the "PROSPECTUS"; provided,
however, that all references to the "Registration Statement" and
the "Prospectus" shall be deemed to include all documents incorporated therein
by reference pursuant to the Securities Exchange Act of 1934, as amended (the
"EXCHANGE ACT"), prior to the date hereof; provided, further, that if the
Company files a registration statement with the Commission pursuant to Section
462(b) of the Rules and Regulations (the "RULE 462 REGISTRATION STATEMENT"),
then, after such filing, all references to "Registration Statement" shall be
deemed to include the Rule 462 Registration Statement; and provided, further,
that if the Company elects to rely upon Rule 434 of the Rules and Regulations,
then all references to "Prospectus" shall be deemed to include the final
Prospectus in the form first furnished to the Underwriter by the Company in
reliance upon Rule 434 of the Rules and Regulations. For purposes of this
Agreement, all references to the Registration Statement or Prospectus or to any
amendment or supplement to any of the foregoing shall be deemed to include the
copy filed with the Commission pursuant to its Electronic Data Gathering,
Analysis and Retrieval system ("XXXXX").
All references in this Agreement to financial statements and
schedules and other information which is "contained," "included" or "stated"
(and all references of like import) in the Registration Statement or Prospectus
shall be deemed to mean and include all such financial statements and schedules
and other information which is incorporated by reference in the Registration
Statement or Prospectus, as the case may be; and all references in this
Agreement to amendments or supplements to the Registration Statement or
Prospectus shall be deemed to mean and include the filing of any document under
the Exchange Act which is incorporated by reference in the Registration
Statement or Prospectus, as the case may be.
(b) The Company meets the requirements for use of Form S-3
under the Securities Act. Each of the Registration Statement and any Rule 462(b)
Registration Statement has become effective under the Securities Act and no stop
order suspending the effectiveness of the Registration Statement or any Rule
462(b) Registration Statement has been issued under the Securities Act and no
proceedings for that purpose have been instituted or are pending or, to the
knowledge of the Company after due inquiry, are contemplated by the Commission,
and any request on the part of the Commission for additional information has
been complied with. No order preventing or suspending the use of the Prospectus
has been issued and no proceeding for that purpose has been instituted or, to
the knowledge of the Company threatened by the Commission or the state
securities authority of any jurisdiction.
At the respective times the Registration Statement, any Rule
462(b) Registration Statement and any post-effective amendments thereto
(including the filing of the Company's most recent Annual Report on Form 10-K,
as amended, with the Commission) became effective and as of the date hereof and
as of each Delivery Date (as hereinafter defined in Section 4), the Registration
Statement, any Rule 462(b) Registration Statement and any amendments and
supplements thereto complied and will comply in all material respects with the
requirements of the Securities Act and the Rules and Regulations and did not and
will not contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
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statements therein not misleading. At the date of the Prospectus and at each
Delivery Date, the Prospectus and any amendments and supplements thereto did not
and will not include an untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading. If the Company
elects to rely upon Rule 434 of the Rules and Regulations, the Company will
comply with the requirements of Rule 434. Notwithstanding the foregoing, the
representations and warranties in this subsection shall not apply to statements
in or omissions from the Registration Statement or the Prospectus made in
reliance upon and in conformity with information furnished to the Company in
writing by the Underwriter expressly for use in the Registration Statement or
the Prospectus.
Each Preliminary Prospectus and Prospectus filed as part of
the Registration Statement as originally filed or as part of any amendment
thereto, or filed pursuant to Rule 424 under the Securities Act, complied when
so filed in all material respects with the Rules and Regulations and, if
applicable, each Preliminary Prospectus and the Prospectus delivered to the
Underwriter for use in connection with the offering of the Shares will, at the
time of such delivery, be identical to the electronically transmitted copies
thereof filed with the Commission pursuant to XXXXX, except to the extent
permitted by Regulation S-T.
(c) The documents incorporated or deemed to be incorporated by
reference in the Registration Statement and the Prospectus, at the time they
were or hereafter are filed with the Commission, complied and will comply in all
material respects with the requirements of the Exchange Act and the Rules and
Regulations and, when read together with the other information in the
Prospectus, at the date of the Prospectus, and at each Delivery Date, did not
and will not include an untrue statement of a material fact or omit to state a
material fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.
(d) The Company and each of its subsidiaries (as defined in
Section 14) have been duly incorporated or formed and are validly existing as a
Bermuda exempted company, or as corporations, limited liability companies or
limited partnerships, as the case may be, in good standing under the laws of
their respective jurisdictions of incorporation or formation, have the requisite
power and authority to own their respective properties and conduct their
respective businesses, are duly qualified to do business and are in good
standing as foreign corporations, limited liability companies or limited
partnerships in each jurisdiction in which their respective ownership or lease
of property or the conduct of their respective businesses requires such
qualification, except to the extent that the failure to be so qualified or be in
good standing would not have a material adverse effect on the consolidated
financial position, shareholders' equity, results of operations or business of
the Company and its subsidiaries, taken as a whole (a "MATERIAL ADVERSE
EFFECT"). Each of the subsidiaries of the Company that is a "Significant
Subsidiary", as such term is defined in Section 14, is listed (together with its
jurisdiction of incorporation or formation) on Schedule 1 hereto.
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(e) The Company has an authorized capitalization as set forth
in the Prospectus, and all of the issued shares of the Company have been duly
and validly authorized and issued, are fully paid and non-assessable and conform
to the description thereof contained in the Prospectus; and all of the issued
shares, capital stock or other equity interests of each subsidiary of the
Company, have been duly and validly authorized and issued and are fully paid and
non-assessable and (except for directors' qualifying shares) are owned directly
or indirectly by the Company, free and clear of all liens, encumbrances,
equities or claims.
(f) The Shares to be issued and sold by the Company to the
Underwriter hereunder have been duly and validly authorized and, when issued and
delivered against payment therefor in accordance with this Agreement, will be
duly and validly issued, fully paid and non-assessable; no holder thereof will
be subject to personal liability solely by reason of being such a holder; the
issuance of the Shares will not be subject to preemptive rights; and the Shares
will conform to the description thereof contained or incorporated by reference
in the Prospectus.
(g) The Shares will have been approved for listing on the New
York Stock Exchange, subject only to official notice of issuance, prior to the
First Delivery Date (as defined in Section 4);
(h) The Company has all requisite power and authority to
execute, deliver and perform its obligations under this Agreement, and this
Agreement has been duly authorized, executed and delivered by the Company.
(i) The execution, delivery and performance of this Agreement
by the Company and the consummation of the transactions contemplated hereby
(including the use of proceeds from the sale of the Shares as described under
the caption "Use of Proceeds" in the Prospectus, will not (i) conflict with or
result in a breach or violation of any of the terms or provisions of, or
constitute a default under, any indenture, mortgage, deed of trust, loan
agreement or other agreement, license or instrument to which the Company or any
of its subsidiaries is a party or by which the Company or any of its
subsidiaries is bound or to which any of the property or assets of the Company
or any of its subsidiaries is subject, (ii) result in any violation of the
provisions of the charter or bye-laws (or similar governing document) of the
Company or any of its Significant Subsidiaries, (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 subsidiaries, any of
their properties or assets or (iv) except for such consents, approvals,
authorizations, filings or registrations or qualifications as may be required
under applicable securities laws in connection with the purchase and
distribution of Shares by the Underwriter, require any consent, approval,
authorization or order of, or filing or registration with, any person or any
such court or governmental agency or body; except for such consent, approval,
authorization or order, which if not obtained would, or such conflict, breach,
violation or default which would, for purposes of clauses (i), (iii) and (iv)
above, either individually or in the aggregate, not have a Material Adverse
Effect.
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(j) Neither the Company nor any of its subsidiaries is (i) in
violation of its charter or bye-laws or similar governing document, as
applicable, (ii) in default, and no event has occurred which, with notice or
lapse of time or both, would constitute such a default, in the due performance
or observance of any term, obligation, agreement, covenant or condition
contained in any material contract, indenture, mortgage, deed of trust, loan
agreement, lease or other agreement or instrument to which it is a party or by
which it is bound or which any of its properties or assets may be subject or
(iii) in violation of any law, ordinance, governmental rule, regulation or court
decree to which it or its property or assets may be subject, except with respect
to (ii) or (iii), for any such violations or defaults that would not be
reasonable likely, singly or in the aggregate, to have a Material Adverse
Effect.
(k) Except as described in the Prospectus or in connection
with acquisitions for which any registration statements were required to be, and
have been, filed with the Commission, there are no contracts, agreements or
understandings between the Company and any person granting such person the right
to require the Company to file a registration statement under the Securities Act
with respect to any securities of the Company owned or to be owned by such
person or to require the Company to include such securities in the securities
registered pursuant to the Registration Statement or in any securities being
registered pursuant to any other registration statement filed by the Company
under the Securities Act.
(l) The Company has not sold or issued any Common Shares
during the six-month period preceding the date of the Prospectus, including any
sales pursuant to Rule 144A or Regulations D or S under the Securities Act,
other than shares issued pursuant to employee benefit plans, options plans or
other employee compensation plans, pursuant to outstanding options, rights or
warrants or in connection with acquisitions for which any registration
statements were required to be, and have been, filed with the Commission.
(m) Neither the Company nor any of its subsidiaries has
sustained, since the date of the latest audited financial statements included 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 Registration Statement or the
Prospectus; and, since such date, there has not been any material change in the
capital stock or long-term debt of the Company or any of its subsidiaries, or
any material adverse change or any development involving a prospective material
adverse change in the condition, financial or otherwise, or in the earnings or
business of the Company and its subsidiaries, otherwise than as set forth or
contemplated in the Registration Statement or the Prospectus.
(n) The consolidated financial statements filed as part of the
Registration Statement or included in the Prospectus present fairly in all
material respects the financial position, results of operations and changes in
financial position of the Company and its subsidiaries at the dates and for the
periods indicated, all in conformity
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with generally accepted accounting principles (subject, in the case of interim
statements, to normal year-end audit adjustments); and the Company has no
material contingent obligation which is not disclosed in such financial
statements or in the Registration Statement or Prospectus.
(o) Ernst & Young LLP ("ERNST & YOUNG") (who will deliver the
letter referred to in Section 7(i) hereof), who have certified certain financial
statements of the Company, and whose reports are incorporated by reference in
the Prospectus, are independent public accountants as required by the Securities
Act and the Rules and Regulations.
(p) Deloitte & Touche LLP ("DELOITTE & TOUCHE") (who will
deliver the letter referred to in Section 7(k) hereof), who have certified
certain financial statements of Universal Compression Holdings, Inc., a Delaware
corporation ("UNIVERSAL"), and whose reports are incorporated by reference in
the Prospectus, are independent public accountants as required by the Securities
Act and the Rules and Regulations.
(q) The Company and each of its subsidiaries have good and
indefeasible 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 such as do not materially affect the
value of such property and do not materially interfere with the use made and
proposed to be made of such property by the Company and its subsidiaries; and
all assets held under lease by the Company and its subsidiaries are held by them
under valid, subsisting and enforceable leases, with such exceptions as are not
material and do not interfere with the use made and proposed to be made of such
property and buildings by the Company and its subsidiaries.
(r) Each of the Company and its subsidiaries has all consents,
authorizations, approvals, orders, certificates and permits of and from, and has
made all declarations and filings with, all federal, state, local and other
governmental authorities, and all courts or other tribunals (collectively, the
"LICENSES") necessary to own, hold, or lease, as the case may be, and to operate
its properties and to carry on its business as presently conducted, except where
the failure to possess such Licenses would not reasonably be expected to have a
Material Adverse Effect, and neither the Company nor any of its subsidiaries has
received any notice of proceedings relating to revocation or modification of any
such Licenses, except to the extent that any such revocation or modification
would not have a Material Adverse Effect.
(s) The Company and each of its subsidiaries carry, or are
covered by, insurance in such amounts and covering such risks as they reasonably
deem sufficient for the conduct of their respective businesses and the value of
their respective properties, and neither the Company nor any subsidiary has
received notice of cancellation or non-renewal of such insurance.
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(t) The Company and each of its subsidiaries own or possess
adequate rights to use all material patents, patent applications, trademarks,
service marks, trade names, trademark registrations, service xxxx registrations,
copyrights and licenses necessary for the conduct of their respective businesses
and have no reason to believe that the conduct of their respective businesses
will conflict with, and have not received any notice of any claim of conflict
with, any such rights of others, except where such conflict could not reasonably
be expected to have a Material Adverse Effect.
(u) There is no action, suit or proceeding before or by any
government, governmental instrumentality or court, domestic or foreign, now
pending or, to the knowledge of the Company, threatened against or affecting the
Company or any of its subsidiaries or to which any of their respective
properties are subject that would reasonably be expected to result in any
Material Adverse Effect, or that would reasonably be expected to adversely
affect the consummation of the transactions contemplated in this Agreement.
(v) There are no contracts or other documents which are
required to be described in the Prospectus or filed as exhibits to the
Registration Statement by the Securities Act or by the Rules and Regulations
which have not been described as required in the Prospectus or filed as exhibits
to the Registration Statement.
(w) No relationship, direct or indirect, exists between or
among the Company on the one hand, and the directors, officers, shareholders,
customers or suppliers of the Company on the other, which is required to be
described in the Prospectus which is not described as required.
(x) No labor disturbance by the employees of the Company or
its subsidiaries exists or, to the knowledge of the Company, is imminent, which
would reasonably be expected to have a Material Adverse Effect; and there are no
significant unfair labor practice complaints pending against the Company or any
of its subsidiaries or, to the best of the Company's knowledge, threatened
against any of them.
(y) The Company and its subsidiaries are in compliance in all
material respects with all presently applicable provisions of the Employee
Retirement Income Security Act of 1974, as amended, including the regulations
and published interpretations thereunder ("ERISA"); no "REPORTABLE EVENT" (as
defined in ERISA) has occurred with respect to any "PENSION PLAN" (as defined in
ERISA) for which the Company or any of its subsidiaries could have any
liability; neither the Company nor any of its subsidiaries has incurred and none
of them expect to incur liability under (i) Title IV of ERISA with respect to
termination of, or withdrawal from, any "pension plan" or (ii) Sections 412 or
4971 of the Internal Revenue Code of 1986, as amended, including the regulations
and published interpretations thereunder (the "CODE"); and each "pension plan"
for which the Company or any of its subsidiaries would have any liability that
is intended to be qualified under Section 401(a) of the Code is so qualified in
all material respects and nothing has occurred, whether by action or by failure
to act, which would cause the loss of such qualification. With respect to each
employee benefit plan for which the
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Company or any of its subsidiaries may have any liability, contingent or
otherwise, that is subject to the laws of any jurisdiction outside of the United
States (a "FOREIGN PLAN") (i) the Foreign Plan is, and has been established,
registered (where required), qualified, administered, funded (where required)
and invested in compliance in all material respects with the terms thereof and
all applicable laws, (ii) full payment has been made in a timely manner of all
amounts which are required to be made as contributions, payments or premiums to
or in respect of any Foreign Plan under applicable law or under the terms of the
Foreign Plan, except as would not result in a material liability to the Company
and its subsidiaries and (iii) no taxes, penalties or fees are owing or
assessable with respect to any Foreign Plan, except as would not result in a
material liability to the Company and its subsidiaries.
(z) Except as disclosed in the Prospectus as amended or
supplemented, under current laws and regulations of Bermuda and any political
subdivision thereof, all dividends and other distributions declared and payable
on any Common Shares may be paid by the Company to the holder thereof in United
States dollars that may be converted into foreign currency and freely
transferred out of Bermuda and all such payments made to holders thereof who are
non-residents of Bermuda will not be subject to income, withholding or other
taxes under laws and regulations of Bermuda or any political subdivision or
taxing authority thereof or therein and, except for the stamp duty described in
the Prospectus as amended or supplemented, will otherwise be free and clear of
any other tax, duty, withholding or deduction in Bermuda or any political
subdivision or taxing authority thereof or therein and without the necessity of
obtaining any governmental authorization in Bermuda or any political subdivision
or taxing authority thereof or therein;
(aa) The Company and its subsidiaries have filed all federal,
state and local income and franchise tax returns required to be filed through
the date hereof and have paid all taxes due thereon, and no tax deficiency has
been determined adversely to the Company or any of its subsidiaries which has
had (nor does the Company have any knowledge of any tax deficiency which, if
determined adversely to the Company or any of its subsidiaries, would reasonably
be expected to have) a Material Adverse Effect. The charges, accruals and
reserves on the books of the Company and its subsidiaries in respect of taxes or
other governmental charges are, in the opinion of the Company, adequate.
(bb) Since the date as of which information is given in the
Prospectus through the date hereof, and except as may otherwise be disclosed in
the Prospectus, the Company has not (i) issued or granted any securities (other
than pursuant to option plans and benefit plans), (ii) incurred any liability or
obligation, direct or contingent, other than liabilities and obligations which
were incurred in the ordinary course of business, (iii) entered into any
material transaction not in the ordinary course of business or (iv) declared or
paid any dividend on its shares.
(cc) The Company (i) makes and keeps books and records, which
accurately reflect transactions and dispositions of the Company's assets, (ii)
maintains
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internal accounting controls which provide reasonable assurance that (A)
transactions are executed in accordance with management's general and specific
authorization, (B) transactions are recorded as necessary to permit preparation
of its financial statements and to maintain accountability for its assets, (C)
access to its assets is permitted only in accordance with management's general
and specific authorization and (D) the recorded accountability for its assets is
compared with existing assets at reasonable intervals.
(dd) Neither the Company nor any of its subsidiaries, nor any
director, officer, agent, employee or other person associated with or acting on
behalf of the Company or any of its subsidiaries, has used any corporate funds
for any unlawful contribution, gift, entertainment or other unlawful expense
relating to political activity; made any direct or indirect unlawful payment to
any foreign or domestic government official or employee from corporate funds;
violated or is in violation of any provision of the Foreign Corrupt Practices
Act of 1977 or similar law, ordinance, rule or regulation applicable to the
Company and its subsidiaries; or made any bribe, rebate, payoff, influence
payment, kickback or other unlawful payment.
(ee) There has been no storage, disposal, generation,
manufacture, refinement, transportation, handling or treatment of toxic wastes,
medical wastes, hazardous wastes or hazardous substances by the Company or any
of its subsidiaries (or, to the knowledge of the Company, any of their
predecessors in interest) at, upon or from any of the property now or previously
owned or leased by the Company or its subsidiaries in violation of any
applicable law, ordinance, rule, regulation, order, judgment, decree or permit
or which would require remedial action under any applicable law, ordinance,
rule, regulation, order, judgment, decree or permit, except for any violation or
remedial action which would not have, or would not be reasonably likely to have,
singularly or in the aggregate with all such violations and remedial actions, a
Material Adverse Effect; there has been no material spill, discharge, leak,
emission, injection, escape, dumping or release of any kind onto such property
or into the environment surrounding such property of any toxic wastes, medical
wastes, solid wastes, hazardous wastes or hazardous substances due to or caused
by the Company or any of its subsidiaries or with respect to which the Company
or any of its subsidiaries have knowledge, except for any such spill, discharge,
leak, emission, injection, escape, dumping or release which would not have or
would not be reasonably likely to have, singularly or in the aggregate with all
such spills, discharges, leaks, emissions, injections, escapes, dumpings and
releases, a Material Adverse Effect; and the terms "HAZARDOUS WASTES", "TOXIC
WASTES", "HAZARDOUS SUBSTANCES" and "MEDICAL WASTES" shall have the meanings
specified in any applicable local, state, federal and foreign laws or
regulations with respect to environmental protection.
(ff) Neither the Company nor any subsidiary is, or, as of any
Delivery Date after giving effect to the application of the net proceeds
therefrom as described in the Prospectus, will be, an "investment company" or an
entity "controlled" by an "investment company", as such terms are defined in the
Investment Company Act of 1940, as amended.
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(gg) None of the Company or its subsidiaries has taken, and
none of them will take, directly or indirectly, any action in violation of
applicable law 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.
(hh) Other than as described in the Prospectus, the Company
has not incurred any liability for any finder's fees or similar payments in
connection with the transactions contemplated hereby.
(ii) (i) The Company has established and maintains disclosure
controls and procedures (as such term is defined in Rule 13a-14 under the
Exchange Act); (ii) such disclosure controls and procedures are designed to
ensure that information required to be disclosed by the Company in the reports
it files or submits under the Exchange Act is accumulated and communicated to
the Company's management, including its principal executive officer and its
principal financial officer, as appropriate, to allow timely decisions regarding
required disclosure; and (iii) such disclosure controls and procedures are
effective in all material respects to perform the functions for which they were
established.
(jj) Since the date of the filing of the Company's Quarterly
Report on Form 10-Q for the quarter ended March 31, 2003, the Company's auditors
and the audit committee of the board of directors of the Company (or persons
fulfilling the equivalent function) have not been advised of (i) any significant
deficiencies in the design or operation of internal controls which could
adversely affect the Company's ability to record, process, summarize and report
financial data nor any material weaknesses in internal controls; and (ii) any
fraud, whether or not material, that involves management or other employees who
have a significant role in the Company's internal controls.
(kk) Since the date of the filing of the Company's Quarterly
Report on Form 10-Q for the quarter ended March 31, 2003, there have been no
significant changes in internal controls or in other factors that could
significantly affect internal controls, including any corrective actions with
regard to significant deficiencies and material weaknesses.
(ll) Since the date of the most recent evaluation of such
disclosure controls and procedures, there have been no significant changes in
internal controls or in other factors that could significantly affect internal
controls, including any corrective actions with regard to significant
deficiencies and material weaknesses.
SECTION 2. Purchase of the Shares by the Underwriter. On the basis of
the representations and warranties of the Company contained in, and subject to
the terms and conditions of, this Agreement, the Company agrees to sell
10,000,000 Firm Shares to the Underwriter and the Underwriter agrees to purchase
10,000,000 Firm Shares.
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In addition, the Company grants to the Underwriter an option
to purchase up to 1,500,000 Option Shares. Such option is granted for the
purpose of covering over-allotments in the sale of Firm Shares and is
exercisable as provided in Section 4 hereof.
The price of both the Firm Shares and any Option Shares shall
be $40.00 per share.
The Company shall not be obligated to deliver any of the
Shares to be delivered on any Delivery Date (as hereinafter defined), except
upon payment for all the Shares to be purchased on such Delivery Date as
provided herein.
SECTION 3. Offering of Shares by the Underwriter.
The Underwriter proposes to offer the Firm Shares for sale
upon the terms and conditions set forth in the Prospectus.
SECTION 4. Delivery of and Payment for the Shares. Delivery of and
payment for the Firm Shares shall be made at the offices of Fulbright & Xxxxxxxx
L.L.P., 0000 XxXxxxxx, Xxxxx 0000, Xxxxxxx, Xxxxx 00000, at 8:00 A.M., Houston,
Texas time, on July 3, 2003 or at such other date or place as shall be
determined by agreement between the Underwriter and the Company. This date and
time are sometimes referred to as the "FIRST DELIVERY DATE." On the First
Delivery Date, the Company, through the facilities of The Depository Trust
Company ("DTC"), shall deliver or cause to be delivered a securities entitlement
with respect to the Firm Shares to the Underwriter against payment of the
purchase price by wire transfer of same-day funds to a bank account designated
by the Company. Time shall be of the essence, and delivery at the time and place
specified pursuant to this Agreement is a further condition of the Underwriter's
obligation hereunder. Upon delivery, the Firm Shares shall be registered in the
name of Cede & Co., as nominee for DTC.
The option granted in Section 2 will expire 30 days after the
date of this Agreement and may be exercised in whole or in part from time to
time by written notice being given to the Company by the Underwriter. Such
notice shall set forth the aggregate number of Option Shares as to which the
option is being exercised, the names in which the Option Shares are to be
registered, the denominations in which the Option Shares are to be issued and
the date and time, as determined by the Underwriter, when the Option Shares are
to be delivered; provided, however, that this date and time shall not be earlier
than the First Delivery Date nor earlier than the second business day after the
date on which the option shall have been exercised nor later than the fifth
business day after the date on which the option shall have been exercised. The
date and time the shares of Option Shares are delivered are sometimes referred
to as a "SECOND DELIVERY DATE" and the First Delivery Date and any Second
Delivery Date are sometimes each referred to as a "DELIVERY DATE".
Delivery of and payment for the Option Shares shall be made at
the place specified in the first sentence of the first paragraph of this Section
4 (or at such other
11
place as shall be determined by agreement between the Underwriter and the
Company) at 9:00 A.M., Houston, Texas time, on such Second Delivery Date. On the
Second Delivery Date, the Company, through the facilities of DTC, shall deliver
or cause to be delivered a securities entitlement with respect to the Option
Shares to the Underwriter for its account against payment of the purchase price
by wire transfer of same-day funds to a bank account designated by the Company.
Time shall be of the essence, and delivery at the time and place specified
pursuant to this Agreement is a further condition of the Underwriter's
obligation hereunder. Upon delivery, the Option Shares shall be registered in
the name of Cede & Co., as nominee of DTC.
SECTION 5. Further Agreements of the Company. The Company agrees:
(a) To prepare the Prospectus in a form approved by the
Underwriter and to file such Prospectus pursuant to Rule 424(b) under the
Securities Act not later than Commission's close of business on the second
business day following the execution and delivery of this Agreement or, if
applicable, such earlier time as may be required by Rule 430A(a)(3) under the
Securities Act; to make no further amendment or any supplement to the
Registration Statement or to the Prospectus except as permitted herein; to
advise the Underwriter, promptly after it receives notice thereof, of the time
when any amendment to the Registration Statement has been filed or becomes
effective or any supplement to the Prospectus or any amended Prospectus has been
filed and to furnish the Underwriter with copies thereof; to advise the
Underwriter, promptly after it receives notice thereof, of the issuance by the
Commission of any stop order or of any order preventing or suspending the use of
the Prospectus, 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 the Prospectus or for
additional information; and, in the event of the issuance of any stop order or
of any order preventing or suspending the use of the Prospectus or suspending
any such qualification, to use promptly its reasonable best efforts to obtain
its withdrawal;
(b) To furnish promptly to the Underwriter and to counsel for
the Underwriter a signed copy of the Registration Statement as originally filed
with the Commission, and each amendment thereto filed with the Commission,
including all consents and exhibits filed therewith, and if applicable, the
copies of the Registration Statement and each amendment thereto furnished to the
Underwriter will be identical to the electronically transmitted copies thereof
filed with the Commission pursuant to XXXXX, except to the extent permitted by
Regulation S-T;
(c) To deliver promptly to the Underwriter such number of the
following documents as the Underwriter shall reasonably request: (i) conformed
copies of the Registration Statement as originally filed with the Commission and
each amendment thereto (in each case excluding exhibits) and (ii) the Prospectus
and any amended or supplemented Prospectus; and, if the delivery of a prospectus
is required at any time after the First Delivery Date in connection with the
offering or sale of the Shares or any other securities relating thereto and if
at such time any events shall have occurred
12
as a result of which the Prospectus as then amended or supplemented would
include an untrue statement of a material fact or omit to state any material
fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made when such Prospectus is delivered, not
misleading, or, if for any other reason it shall be necessary to amend or
supplement the Prospectus in order to comply with the Securities Act, to notify
the Underwriter and, upon its request, to prepare and furnish without charge to
the Underwriter and to any dealer in securities as many copies as the
Underwriter may from time to time reasonably request of an amended or
supplemented Prospectus which will correct such statement or omission or effect
such compliance, and the Prospectus and any amendments or supplements thereto
furnished to the Underwriter will be identical to the electronically transmitted
copies thereof filed with the Commission pursuant to XXXXX, except to the extent
permitted by Regulation S-T;
(d) To file promptly with the Commission any amendment to the
Registration Statement or the Prospectus or any supplement to the Prospectus
that may, in the judgment of the Company or the Underwriter after consultation
with its outside counsel, be required by the Securities Act or requested by the
Commission;
(e) Prior to filing with the Commission any amendment to the
Registration Statement or supplement to the Prospectus or any Prospectus
pursuant to Rule 424 of the Rules and Regulations, to furnish a copy thereof to
the Underwriter and counsel for the Underwriter and obtain the consent of the
Underwriter to the filing, which consent shall not be unreasonably withheld;
(f) To make generally available to the Company's security
holders and to deliver to the Underwriter an earnings statement of the Company
and its subsidiaries (which need not be audited), complying with Section 11(a)
of the Securities Act and the Rules and Regulations (including, at the option of
the Company, Rule 158);
(g) For a period of two years following the First Delivery
Date, to furnish to the Underwriter copies of all materials furnished by the
Company to its shareholders and all public reports and all reports and financial
statements furnished by the Company to the New York Stock Exchange or the
principal national securities exchange upon which the Shares may be listed
pursuant to requirements of or agreements with the New York Stock Exchange or to
the Commission pursuant to the Exchange Act or any rule or regulation of the
Commission thereunder; provided, however, the Company shall not have to furnish
any such materials, reports and financial statements that have been filed with
the Commission pursuant to XXXXX and are available for review by the
Underwriter;
(h) Promptly from time to time to take such action as the
Underwriter may reasonably request to qualify the Shares for offering and sale
under the securities laws of such jurisdictions as the Underwriter 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
13
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;
(i) For a period of 60 days from the date hereof, not to,
directly or indirectly, (i) offer for sale, sell, pledge or otherwise dispose of
(or enter into any transaction or device which is designed to, or could be
expected to, result in the disposition by any person at any time in the future
of) any Common Shares or securities convertible into or exchangeable for Common
Shares (other than the Shares and shares issued pursuant to employee benefit
plans, qualified Common Shares option plans or other employee compensation plans
existing on the date hereof or pursuant to currently outstanding options,
warrants or rights or upon exercise of outstanding convertible securities), or
sell or grant options, rights or warrants with respect to any Common Shares or
securities convertible into or exchangeable for Common Shares (other than the
grant of options pursuant to option plans existing on the date hereof), or (ii)
enter into any swap or other derivatives transaction that transfers to another,
in whole or in part, any of the economic benefits or risks of ownership of such
Common Shares whether any such transaction described in clause (i) or (ii) above
is to be settled by delivery of Common Shares or other securities, in cash or
otherwise, in each case without the prior written consent of the Underwriter
(provided that notwithstanding the foregoing, the Company may enter into a
business acquisition agreement or agreements that contemplate the sale, exchange
or issuance of Common Shares or securities convertible into, exercisable for or
exchangeable for Common Shares, so long as the actual sale, exchange or issuance
thereof does not occur within such 60-day period, without the prior written
consent of the Underwriter); and to use reasonable best efforts to cause each
officer and director of the Company to furnish to the Underwriter, prior to the
First Delivery Date, a letter or letters, substantially in the form of Exhibit A
hereto, pursuant to which each such person shall agree not to, directly or
indirectly, except as set forth in such letter or letters, (A) offer for sale,
sell, pledge or otherwise dispose of (or enter into any transaction or device
which is designed to, or could be expected to, result in the disposition by any
person at any time in the future of) any Common Shares or securities convertible
into or exchangeable for Common Shares or (B) enter into any swap or other
derivatives transaction that transfers to another, in whole or in part, any of
the economic benefits or risks of ownership of such Common Shares, whether any
such transaction described in clause (A) or (B) above is to be settled by
delivery of Common Shares or other securities, in cash or otherwise, in each
case for a period of 60 days from the date of the Prospectus, without the prior
written consent of the Underwriter, which consent will not be unreasonably
withheld; provided, however, that the restrictions in clauses (i) and (ii) above
shall not apply to (x) any bona fide transfer of Common Shares or any securities
convertible into or exchangeable or exercisable for Common Shares by an officer
or director of the Company to a donee; provided, that (A) each donee shall
execute and deliver to Xxxxxx Brothers Inc. a duplicate form of this Lock-up
Letter Agreement, and (B) such transfer shall be for estate planning purposes or
for charitable donations, or (y) sales of Common Shares by such officers and
directors in an aggregate amount not to exceed 100,000 Common Shares.
(j) To apply for the listing of the Shares on the New York
Stock Exchange, and to use its reasonable best efforts to complete that listing,
subject only to official notice of issuance, prior to the First Delivery Date;
(k) To apply the net proceeds from the sale of the Shares as
set forth in the Prospectus under the caption "Use of Proceeds"; and
14
(l) To take such steps as shall be necessary to ensure that
neither the Company nor any subsidiary shall become an "investment company" or
an entity "controlled" by an "investment company" as such terms are defined in
the Investment Company Act of 1940, as amended.
SECTION 6. Expenses. The Company agrees to pay (a) the costs incident
to the authorization, issuance, sale and delivery of the Shares and any taxes
payable in that connection; (b) the costs incident to the preparation, printing
and filing of the Registration Statement and any amendments and exhibits
thereto; (c) the costs of distributing the Registration Statement as originally
filed and each amendment thereto and any post-effective amendments thereof
(including, in each case, exhibits), any Preliminary Prospectus, the Prospectus
and any amendment or supplement to the Prospectus and any document incorporated
by reference therein, all as provided in this Agreement; (d) the costs of
producing and distributing this Agreement and any other related documents in
connection with the offering, purchase, sale and delivery of the Shares; (e) the
filing fees incident to securing the review by the New York Stock Exchange,
Inc., any applicable Bermuda governmental entity, and, if applicable, the
National Association of Securities Dealers, Inc. of the terms of sale of the
Shares; (f) any applicable listing or other fees; (g) the fees and expenses (not
to exceed $10,000) of qualifying the Shares under the securities laws of the
several jurisdictions as provided in Section 5(h) and of preparing, printing and
distributing a Blue Sky Memorandum (including related fees and expenses of
counsel to the Underwriter); (h) all other costs and expenses incident to the
performance of the obligations of the Company under this Agreement; provided
that, except as provided in this Section 6 and in Section 10 the Underwriter
shall pay its own costs and expenses, including the costs and expenses of its
counsel, any transfer taxes on the Shares which it may sell and the expenses of
advertising any offering of the Shares made by the Underwriter.
SECTION 7. Conditions of Underwriter's Obligations. The obligations of
the Underwriter hereunder are subject to the accuracy, when made and on each
Delivery Date, of the representations and warranties of the Company contained
herein, to the performance by the Company of its obligations hereunder, and to
each of the following additional terms and conditions:
(a) The Prospectus shall have been timely filed with the
Commission in accordance with Section 5(a); no stop order suspending the
effectiveness of the Registration Statement or any part thereof shall have been
issued and no proceeding for that purpose shall have been initiated or
threatened by the Commission; and any request of the Commission for inclusion of
additional information in the Registration Statement or the Prospectus or
otherwise shall have been complied with.
(b) All corporate proceedings and other legal matters incident
to the authorization, form and validity of this Agreement, the Shares, the
Registration Statement and the Prospectus, and all other legal matters relating
to this Agreement and the transactions contemplated hereby shall be reasonably
satisfactory in all material respects to counsel for the Underwriter, and the
Company shall have furnished to such counsel all
15
documents and information that they may reasonably request to enable them to
pass upon such matters.
(c) Xxxxxxx & Xxxxx L.L.P. shall have furnished to the
Underwriter their written opinion, as U.S. counsel to the Company, addressed to
the Underwriter and dated such Delivery Date, in form and substance reasonably
satisfactory to the Underwriter, to the effect that:
(i) The Registration Statement was declared effective
under the Securities Act as of the date and time specified in
such opinion, the Prospectus was filed with the Commission
pursuant to the subparagraph of Rule 424(b) of the Rules and
Regulations specified in such opinion on the date specified
therein and no stop order suspending the effectiveness of the
Registration Statement has been issued and, to the knowledge
of such counsel, no proceeding for that purpose is pending or
threatened by the Commission;
(ii) The Registration Statement and the Prospectus
and any further amendments or supplements thereto made by the
Company prior to such Delivery Date (except for the financial
statements and financial schedules and other financial data
derived therefrom, included therein or omitted therefrom, as
to which such counsel need express no belief) comply as to
form in all material respects with the requirements of the
Securities Act and the Rules and Regulations, and the
documents incorporated by reference in the Prospectus when
they were filed with the Commission (except for the financial
statements and financial schedules and other financial data
derived therefrom, included therein or omitted therefrom, as
to which such counsel need express no belief) complied as to
form in all material respects with the requirements of the
Exchange Act and the Rules and Regulations;
(iii) The statements contained in the Prospectus
under the caption "Certain Tax Considerations - United States
Federal Income Tax Considerations", insofar as such statements
describe matters of law, summaries of legal matters, documents
or legal conclusions constitute a fair summary thereof that is
accurate in all material respects;
(iv) To such counsel's knowledge and other than as
described in the Prospectus or in connection with acquisitions
for which any registrations statements were required to be,
and have been, filed with the Commission, there are no
contracts, agreements or understandings between the Company
and any person granting such person the right to require the
Company to file a registration statement under the Securities
Act with respect to any securities of the Company owned or to
be owned by such person or to require the Company to include
such securities in the securities registered pursuant to the
Registration Statement or in any
16
securities being registered pursuant to any other registration
statement filed by the Company under the Securities Act;
(v) The Company is not an "investment company" or an
entity "controlled by" an "investment company" as defined in
the Investment Company Act of 1940, as amended; and
(vi) No filing with or Approval of any such court or
governmental agency or body is required for the execution,
delivery and performance of the Underwriting Agreement and the
sale, issuance and delivery of the Shares hereunder, except
for Approvals that have been obtained, the registration under
the Securities Act of such 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 such Shares
by the Underwriter.
In rendering such opinion, such counsel may state that their
opinion is limited to matters governed by the Federal laws of the United States
of America and the laws of the State of Texas. In addition, such counsel may
state that their opinion is subject to customary exceptions and qualifications.
Such opinion may state that such counsel has participated in
conferences with officers and other representatives of the Company,
representatives of the independent public accountants of the Company and the
Underwriter's representatives, at which the contents of the Registration
Statement and Prospectus and related matters were discussed. Based on the
foregoing (relying as to factual matters in respect of the determination of
materiality to a significant extent upon the statements of fact made by officers
and other representatives of the Company), no facts have come to such counsel's
attention that have led such counsel to believe that the Registration Statement,
at the time such Registration Statement became effective, contained any untrue
statement of a material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein not misleading or
that, as of its date, the Prospectus contained an untrue statement of a material
fact or omitted a material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which they were
made, not misleading or that, as of the date hereof, the Prospectus contains an
untrue statement of a material fact or omits to state a material fact necessary
to make the statements therein, in light of the circumstances under which they
were made, not misleading. Such counsel, however, expresses no opinion with
respect to the financial statements and notes and related schedules and other
related financial, accounting and statistical data included in the Registration
Statement or in the Prospectus or any further amendment or supplement thereto.
(d) The Senior Vice President and General Counsel of the
Company shall have furnished to the Underwriter his written opinion, as counsel
to the Company, addressed to the Underwriter and dated such Delivery Date, in
form and substance reasonable satisfactory to the Underwriter, to the effect
that:
17
(i) The Company is duly qualified and in good
standing as a foreign corporation in every jurisdiction in
which the operation of its business or its ownership or
leasing of property makes such qualification necessary, except
where the failure to be so qualified or be in good standing
would not reasonably be expected to have a Material Adverse
Effect;
(ii) Each of the Significant Subsidiaries designated
with an "*" on Schedule 1 hereto, if a corporation, is duly
incorporated, and if a limited partnership or limited
liability company, is duly formed or organized. Each of the
Significant Subsidiaries, if a corporation, is a corporation
validly existing in good standing under the laws of the
jurisdiction of its incorporation, with due corporate power
and authority to own, lease and operate its properties and to
conduct its business as described in the Prospectus, if a
limited partnership, is validly existing and in good standing
(where applicable) under the laws of the jurisdiction of its
organization, with due power and authority to own, lease and
operate its properties and conduct its business as described
in the Prospectus, and if a limited liability company, is
validly existing in good standing (where applicable) under the
laws of the jurisdiction of its formation, with due power and
authority to own, lease and operate its properties and conduct
its business as described in the Prospectus; and all of the
outstanding shares of capital stock of each of the corporate
Significant Subsidiaries, have been duly authorized and
validly issued, are fully paid and non-assessable and all of
the outstanding limited partnership interests and limited
liability company interests of the limited partnership and
limited liability company Significant Subsidiaries are held of
record, directly or indirectly, by the Company;
(iii) To the knowledge of such counsel, except as
described in the Prospectus, there are no preemptive or other
rights to subscribe for or to purchase, nor any restriction
upon the voting or transfer of, any Shares pursuant to any
agreement or other instrument known to such counsel;
(iv) To the knowledge of such counsel, there is no
action, suit or proceeding before or by any government,
governmental instrumentality or court, domestic or foreign,
now pending or threatened against or affecting the Company or
any of its subsidiaries or to which any of their respective
properties are subject that would reasonably be expected to
result in any Material Adverse Effect, or that could
reasonably be expected to adversely affect the consummation of
the transactions contemplated in this Agreement; and
(v) The execution, delivery and performance of this
Agreement by the Company and the consummation of the
transactions contemplated hereby (including the use of
proceeds from the sale of the Shares as
18
described under the caption "Use of Proceeds" in the
Prospectus) do not and will not (i) conflict with or result in
a breach or violation of any of the terms or provisions of, or
constitute a default under, any indenture, mortgage, deed of
trust, loan agreement or other agreement, license or
instrument to which the Company or any of its subsidiaries is
a party or by which the Company or any of its subsidiaries is
bound or to which any of the property or assets of the Company
or any of its subsidiaries is subject, (ii) result in any
violation of the provisions of the charter or by-laws of the
Company's Significant Subsidiaries, (iii) result in any
violation of any statute or order, rule or regulation of any
court or governmental agency or body having jurisdiction over
the Company or any of its subsidiaries, any of their
properties or assets or (iv) except for the registration of
Shares under the Securities Act and such consents, approvals,
authorizations or registrations or qualifications as may be
required under the Exchange Act and applicable state or
foreign securities laws in connection with the purchase and
distribution of Shares by the Underwriter, require any
consent, approval, authorization or order of, or filing or
registration with, any person or any such court or
governmental agency or body; except for such consent,
approval, authorization or order, which if not obtained would,
or such conflict, breach, violation or default which would,
for purposes of clauses (i), (iii) and (iv) above, either
individually or in the aggregate, not reasonably be expected
to have a Material Adverse Effect.
In rendering such opinion, such counsel may state that his
opinion is limited to matters governed by the Federal laws of the United States
of America, the laws of the State of Texas and the General Corporation Law of
the State of Delaware. In addition, such counsel may state that his opinion is
subject to customary exceptions and qualifications.
Such opinion may state that such counsel has participated in
conferences with officers and other representatives of the Company,
representatives of the independent public accountants of the Company and the
Underwriter's representatives, at which the contents of the Registration
Statement and Prospectus and related matters were discussed. Based on the
foregoing (relying as to factual matters in respect of the determination of
materiality to a significant extent upon the statements of fact made by officers
and other representatives of the Company), no facts have come to such counsel's
attention that have led such counsel to believe that the Registration Statement,
at the time such Registration Statement became effective, contained any untrue
statement of a material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein not misleading or
that, as of its date, the Prospectus contained an untrue statement of a material
fact or omitted a material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which they were
19
made, not misleading or that, as of the date hereof, the Prospectus contains an
untrue statement of a material fact or omits to state a material fact necessary
to make the statements therein, in light of the circumstances under which they
were made, not misleading. Such counsel, however, expresses no opinion with
respect to the financial statements and notes and related schedules and other
related financial, accounting and statistical data included in the Registration
Statement or in the Prospectus or any further amendment or supplement thereto.
(e) Xxxxxxx Xxxx & Xxxxxxx shall have furnished to the
Underwriter their written opinion, as Bermuda counsel to the Company, addressed
to the Underwriter and dated such Delivery Date, in form and substance
reasonable satisfactory to the Underwriter, to the effect that:
(i) The Company is duly incorporated and existing
under the laws of Bermuda in good standing (meaning solely
that it has not failed to make any filing with any Bermuda
governmental authority, or to pay any Bermuda government fee
or tax, which would make it liable to be struck off the
Register of Companies and thereby cease to exist under the
laws of Bermuda);
(ii) The Company has the necessary corporate power
and authority to enter into and perform its obligations under
the Purchase Agreement, including the issuance and delivery of
the Shares, to conduct its business and to own, lease and
operate its properties as described in the Registration
Statement. The execution and delivery of the Purchase
Agreement by the Company and the performance by the Company of
its obligations thereunder will not violate the memorandum of
association or bye-laws of the Company nor any applicable law,
regulation, order or decree in Bermuda;
(iii) The Company has taken all corporate action
required to authorize its execution, delivery and performance
of this Agreement, including the issuance of the Shares
pursuant to Bermuda law. This Agreement has been duly executed
and delivered by or on behalf of the Company, and constitutes
the valid and binding obligations of the Company in accordance
with the terms hereof;
(iv) No order, consent, approval, licence,
authorization or validation of or exemption by any government
or public body or authority of Bermuda or any sub-division
thereof is required to authorize or is required in connection
with the execution, delivery, performance and enforcement of
this Agreement, including the issuance and delivery of the
Shares, except such as have been duly obtained in accordance
with Bermuda law;
(v) It is not necessary or desirable to ensure the
enforceability in Bermuda of this Agreement that it be
registered in any register kept by, or filed with, any
governmental authority or regulatory body in Bermuda;
20
(vi) This Agreement will not be subject to ad valorem
stamp duty in Bermuda and no registration, documentary,
recording, transfer or other similar tax, fee or charge is
payable in Bermuda in connection with the execution, delivery,
filing, registration or performance of this Agreement or in
connection with the admissibility in evidence hereof (other
than ordinary court filing fees);
(vii) Based solely upon a review of the register of
members of the Company dated [ ] July, 2003, certified by the
secretary of the Company on [ ] July 2003, the issued shares
of the Company are validly issued, fully paid and
non-assessable (which expression when used in such opinion
shall mean that no further sums are required to be paid by the
holders thereof in connection with the issue of such shares);
(viii) When issued and paid for as contemplated by
this Agreement, the Shares will be validly issued, fully paid
and non-assessable. The issuance of the Shares is not subject
to pre-emptive or similar rights arising pursuant to statute
or the Company's memorandum of association or bye-laws;
(ix) The statements contained in (a) the Prospectus
under the sections "Capitalization," "Description of Capital
Shares" and "Certain Tax Considerations - Bermuda Tax
Considerations" and (b) in Item 15 - Indemnification of
Directors and Officers of the Registration Statement, in each
case, insofar as such statements constitute a summary of the
matters of Bermuda law referred to therein, fairly and
accurately represent such legal matters in all material
respects;
(x) The Company has received an assurance from the
Ministry of Finance under the Exempted Undertakings Tax
Protection Act, 1966 that in the event of there being enacted
in Bermuda any legislation imposing tax computed on profits or
income or computed on any capital asset, gain or appreciation,
or any tax in the nature of estate duty or inheritance tax,
then the imposition of any such tax shall not until March 2016
be applicable to the Company or any of its operations or its
shares, debentures or other obligations except insofar such
tax applies to persons ordinarily resident in Bermuda or to
tax payable in accordance with the provisions of the Land Tax
Xxx 0000 or otherwise payable in relation to any land leased
to the Company;
(xi) Based solely upon a search of the Cause Book of
the Supreme Court of Bermuda conducted at [ am/pm] on [ ] July
2003 (which would not reveal details of proceedings which have
been filed but not actually entered in the Cause Book at the
time of such search), there are no judgments against the
Company or Xxxxxxxxxxx
21
Bermuda Holdings Ltd., nor any legal or governmental
proceedings pending in Bermuda to which the Company is
subject;
(xii) Based solely on a search of the public records
in respect of the Company maintained at the offices of the
Registrar of Companies at [ am/pm] on [ ] July 2003 (which
would not reveal details of matters which have not been lodged
for registration or have been lodged for registration but not
actually registered at the time of such search) and a search
of the Cause Book of the Supreme Court of Bermuda conducted at
[ am/pm] on [ ] July 2003 (which would not reveal details of
proceedings which have been filed but not actually entered in
the Cause Book at the time of such search), no steps have
been, or are being, taken in Bermuda for the appointment of a
receiver or liquidator to, or for the winding-up, dissolution,
reconstruction or reorganization of, the Company;
(xiii) The choice of the Foreign Laws as the
governing law of this Agreement is a valid choice of law and
would be recognized and given effect to in any action brought
before a court of competent jurisdiction in Bermuda, except
for those laws (i) which such court considers to be procedural
in nature, (ii) which are revenue or penal laws or (iii) the
application of which would be inconsistent with public policy,
as such term is interpreted under the laws of Bermuda. The
submission in this Agreement to the non-exclusive jurisdiction
of the Foreign Courts is valid and binding upon the Company
and would be recognized by the courts of Bermuda as legal,
valid and binding upon the Company;
(xiv) The courts of Bermuda would recognize as a
valid judgment, a final and conclusive judgment in personam
obtained in the Foreign Courts against the Company based upon
this Agreement under which a sum of money is payable (other
than a sum of money payable in respect of multiple damages,
taxes or other charges of a like nature or in respect of a
fine or other penalty) and would give a judgment based thereon
provided that (a) such courts had proper jurisdiction over the
parties subject to such judgment, (b) such courts did not
contravene the rules of natural justice of Bermuda, (c) such
judgment was not obtained by fraud, (d) the enforcement of the
judgment would not be contrary to the public policy of
Bermuda, (e) no new admissible evidence relevant to the action
is submitted prior to the rendering of the judgment by the
courts of Bermuda and (f) there is due compliance with the
correct procedures under the laws of Bermuda;
(xv) The authorized capital of the Company conforms
as to legal matters, to the description thereof contained in
the prospectus contained in the Registration Statement in all
material respects;
22
(xvi) There is no income or other tax of Bermuda
imposed by withholding or otherwise on any dividend or
distribution to be made by the Company to the holders of the
Shares;
(xvii) The Company has been designated as
non-resident of Bermuda for the purposes of the Exchange
Control Act, 1972 and, as such, is free to acquire, hold,
transfer and sell foreign currency (including the payment of
dividends or other distributions) and securities without
restriction; and
(xviii) The Company is not entitled to any immunity
under the laws of Bermuda, whether characterised as sovereign
immunity or otherwise, from any legal proceedings to enforce
this Agreement in respect of itself or its assets or property.
In rendering such opinion, such counsel may state that their
opinion is limited to matters governed by the laws of Bermuda. In addition, such
counsel may state that its opinion is subject to customary exceptions and
qualifications.
(f) Xxxxx Xxxx & Co. shall have furnished to the Underwriter
its written opinion, as Barbados counsel to the Company, addressed to the
Underwriter and dated such Delivery Date, in form and substance reasonable
satisfactory to the Underwriter, to the effect that the statements contained in
the Prospectus under the caption "Certain Tax Considerations - Barbados Tax
Considerations", insofar as such statements describe matters of law, summaries
of legal matters, documents or legal conclusions constitute a fair summary
thereof that is accurate in all material respects.
In rendering such opinion, such counsel may state that their
opinion is limited to matters governed by the laws of Barbados. In addition,
such counsel may state that its opinion is subject to customary exceptions and
qualifications.
(g) The Underwriter shall have received from Fulbright &
Xxxxxxxx L.L.P., counsel for the Underwriter, such opinion or opinions, dated
such Delivery Date, with respect to the issuance and sale of the Shares, the
Registration Statement, the Prospectus and other related matters as the
Underwriter may reasonably require, and the Company shall have furnished to such
counsel such documents as they reasonably request for the purpose of enabling
them to pass upon such matters. In rendering such opinion or opinions, Fulbright
& Xxxxxxxx L.L.P. may rely, as to factual matters, on written certificates of
officers of the Company, as to matters governed by laws of Bermuda on the
opinion of Xxxxxxx, Xxxx & Xxxxxxx, and as to matters governed by the laws of
Barbados, on the opinion of Xxxxx Xxxx & Co.
(h) At the First Delivery Date, the Underwriter shall have
received from Ernst & Young with respect to financial statements of the Company,
a letter in form and substance satisfactory to the Underwriter, addressed to the
Underwriter and dated the First Delivery Date (i) confirming that they are
independent public accountants within the
23
meaning of the Securities Act and are in compliance with the applicable
requirements relating to the qualification of accountants under Rule 2-01 of
Regulation S-X of the Commission and (ii) stating, as of the First Delivery Date
(or, with respect to matters involving changes or developments since the
respective dates as of which specified financial information is given in the
Prospectus, as of a date not more than five days prior to the First Delivery
Date), the conclusions and findings of such firm with respect to the financial
information and other matters ordinarily covered by accountants' "COMFORT
LETTERS" to underwriters in connection with registered public offerings.
(i) With respect to the letter of Ernst & Young referred to in
the preceding paragraph and delivered to the Underwriter on the First Delivery
Date (the "ERNST & YOUNG INITIAL LETTER"), the Company shall have furnished to
the Underwriter a letter (the "ERNST & YOUNG BRING-DOWN LETTER") of such
accountants, addressed to the Underwriter and dated such Delivery Date after the
First Delivery Date (i) confirming that they are independent public accountants
within the meaning of the Securities Act and are in compliance with the
applicable requirements relating to the qualification of accountants under Rule
2-01 of Regulation S-X of the Commission, (ii) stating, as of the date of the
Ernst & Young bring-down letter (or, with respect to matters involving changes
or developments since the respective dates as of which specified financial
information is given in the Prospectus, as of a date not more than five days
prior to the date of the Ernst & Young bring-down letter), the conclusions and
findings of such firm with respect to the financial information and other
matters covered by the Ernst & Young initial letter and (iii) confirming in all
material respects the conclusions and findings set forth in the Ernst & Young
initial letter.
(j) At the First Delivery Date, the Underwriter shall have
received from Deloitte & Touche with respect to financial statements of
Universal, a letter in form and substance satisfactory to the Underwriter,
addressed to the Underwriter and dated the First Delivery Date (i) confirming
that they are independent public accountants within the meaning of the
Securities Act and are in compliance with the applicable requirements relating
to the qualification of accountants under Rule 2-01 of Regulation S-X of the
Commission and (ii) stating, as of the First Delivery Date (or, with respect to
matters involving changes or developments since the respective dates as of which
specified financial information is given in the Prospectus, as of a date not
more than five days prior to the First Delivery Date), the conclusions and
findings of such firm with respect to the financial information and other
matters ordinarily covered by accountants' "COMFORT LETTERS" to underwriters in
connection with registered public offerings.
(k) With respect to the letter of Deloitte & Touche referred
to in the preceding paragraph and delivered to the Underwriter on the First
Delivery Date (the "UNIVERSAL INITIAL LETTER"), the Company shall have furnished
to the Underwriter a letter (the "UNIVERSAL BRING-DOWN LETTER") of such
accountants, addressed to the Underwriter and dated such Delivery Date after the
First Delivery Date (i) confirming that they are independent public accountants
within the meaning of the Securities Act and are in compliance with the
applicable requirements relating to the qualification of accountants under Rule
2-01 of Regulation S-X of the Commission, (ii) stating, as of the date of the
24
Universal bring-down letter (or, with respect to matters involving changes or
developments since the respective dates as of which specified financial
information is given in the Prospectus, as of a date not more than five days
prior to the date of the Universal bring-down letter), the conclusions and
findings of such firm with respect to the financial information and other
matters covered by the Universal initial letter and (iii) confirming in all
material respects the conclusions and findings set forth in the Universal
initial letter.
(l) The Company shall have furnished to the Underwriter a
certificate, dated such Delivery Date, of its Chairman of the Board, its
President or a Vice President and its chief financial officer stating that:
(i) The representations, warranties and agreements of
the Company in Section 1 are true and correct as of such
Delivery Date; the Company has complied with all its
agreements contained herein; and the conditions set forth in
Sections 7(a), 7(m), 7(n) and 7(o) have been fulfilled; and
(ii) They have carefully examined the Registration
Statement and the Prospectus and, in their opinion (A) as of
the such Delivery Date, the Registration Statement and
Prospectus did not include any untrue statement of a material
fact and did not omit to state a material fact required to be
stated therein or necessary to make the statements therein not
misleading, and (B) since such Delivery Date no event has
occurred which should have been set forth in a supplement or
amendment to the Registration Statement or the Prospectus.
(m) Neither the Company nor any of its subsidiaries shall have
sustained since the date of the latest audited financial statements included in
the Prospectus (i) 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 or (ii) since such date
there shall not have been any change in the capital stock or long-term debt of
the Company or any of its subsidiaries or any change, or any development
involving a prospective change, in or affecting the general affairs, management,
financial position, stockholders' equity or results of operations of the Company
and its subsidiaries, otherwise than as set forth or contemplated in the
Prospectus, the effect of which, in any such case described in clause (i) or
(ii), is, in the judgment of the Underwriter, 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 on such Delivery Date on the terms and in
the manner contemplated in the Prospectus.
(n) Subsequent to the execution and delivery of this Agreement
(i) no downgrading shall have occurred in the rating accorded the Company's debt
securities by any "nationally recognized statistical rating organization", as
that term is defined by the
25
Commission for purposes of Rule 436(g)(2) of the Rules and Regulations 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.
(o) Subsequent to the execution and delivery of this Agreement
there shall not have occurred any of the following: (i) trading in securities
generally on the New York Stock Exchange or the American Stock Exchange or in
the over-the-counter market, or trading in any securities of the Company on any
exchange or in the over-the-counter market, shall have been suspended or the
settlement of such trading generally shall have been materially disrupted or
minimum prices shall have been established on any such exchange or such market
by the Commission, by such exchange or by any other regulatory body or
governmental authority having jurisdiction, (ii) a banking moratorium shall have
been declared by Federal or state authorities, (iii) the United States or
Bermuda shall have become engaged in hostilities, there shall have been an
escalation in hostilities involving the United States or Bermuda or there shall
have been a declaration of a national emergency or war by the United States or
Bermuda or (iv) there shall have occurred such a material adverse change in
general economic, political or financial conditions, including without
limitation as a result of terrorist activities after the date hereof (or the
effect of international conditions on the financial markets in the United States
or Bermuda shall be such), as to make it, in the judgment of the Underwriter,
impracticable or inadvisable to proceed with the public offering or delivery of
the Shares being delivered on such Delivery Date on the terms and in the manner
contemplated in the Prospectus.
(p) The New York Stock Exchange, Inc. shall have approved the
Shares for listing, subject only to official notice of issuance.
All opinions, letters, evidence and certificates mentioned
above or elsewhere in this Agreement shall be deemed to be in compliance with
the provisions hereof only if they are in form and substance reasonably
satisfactory to counsel for the Underwriter.
SECTION 8. Indemnification and Contribution.
(a) The Company agrees to indemnify and hold harmless the
Underwriter, its directors, its officers and its employees and each person, if
any, who controls the Underwriter within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act, from and against any loss,
claim, damage or liability, joint or several, or any action in respect thereof
(including, but not limited to, any loss, claim, damage, liability or action
relating to purchases and sales of Shares), to which the Underwriter, director,
officer, employee or controlling person may become subject, under the Securities
Act or otherwise, insofar as such loss, claim, damage, liability or action
arises out of, or is based upon, (i) any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement or the
Prospectus or in any amendment or supplement thereto, (ii) the omission or
alleged omission to state in the Registration Statement or the Prospectus, or in
any amendment or supplement thereto,
26
any material fact required to be stated therein or necessary to make the
statements therein not misleading, or (iii) any act or failure to act or any
alleged act or failure to act by the Underwriter in connection with, or relating
in any manner to, the Shares or the offering contemplated hereby, and which is
included as part of or referred to in any loss, claim, damage, liability or
action arising out of or based upon matters covered by clause (i) or (ii) above
(provided that the Company shall not be liable under this clause (iii) to the
extent that it is determined in a final judgment by a court of competent
jurisdiction that such loss, claim, damage, liability or action resulted
directly from any such acts or failures to act undertaken or omitted to be taken
by the Underwriter through its gross negligence or willful misconduct), and
shall reimburse the Underwriter and each such director, officer, employee or
controlling person promptly upon demand for any legal or other expenses
reasonably incurred by the Underwriter, director, officer, employee or
controlling person in connection with investigating or defending or preparing to
defend against any such loss, claim, damage, liability or action as such
expenses are incurred; provided, however, that the Company shall not be liable
in any such case to the extent that any such loss, claim, damage, liability or
action arises out of, or is based upon, any untrue statement or alleged untrue
statement or omission or alleged omission made in the Registration Statement or
the Prospectus, or in any such amendment or supplement, in reliance upon and in
conformity with written information concerning the Underwriter furnished to the
Company by the Underwriter specifically for inclusion therein which information
consists solely of the information specified in Section 8(e) or due to the
failure by the Underwriter to comply with its Prospectus delivery requirements.
The foregoing indemnity agreement is in addition to any liability that the
Company may otherwise have to the Underwriter or to any director, officer,
employee or controlling person of the Underwriter.
(b) The Underwriter shall indemnify and hold harmless the
Company, its officers and employees, each of its directors, and each person, if
any, who controls the Company within the meaning of the Securities Act, from and
against any loss, claim, damage or liability, joint or several, or any action in
respect thereof, to which the Company or any such director, officer or
controlling person may become subject, under the Securities Act or otherwise,
insofar as such loss, claim, damage, liability or action arises out of, or is
based upon, (i) any untrue statement or alleged untrue statement of a material
fact contained in any Preliminary Prospectus, the Registration Statement or the
Prospectus or in any amendment or supplement thereto, or (ii) the omission or
alleged omission to state in any Preliminary Prospectus, the Registration
Statement or the Prospectus, or in any amendment or supplement thereto, any
material fact required to be stated therein or necessary to make the statements
therein not misleading, but in each case only to the extent that the untrue
statement or alleged untrue statement or omission or alleged omission was made
in reliance upon and in conformity with written information concerning the
Underwriter furnished to the Company by the Underwriter specifically for
inclusion therein, which information consists solely of the information
specified in Section 8(e), or (iii) any failure by the Underwriter to comply
with its prospectus delivery requirements, and shall reimburse the Company and
any such director, officer or controlling person for any legal or other expenses
reasonably incurred
27
by the Company or any such director, officer, employee or controlling person in
connection with investigating or defending or preparing to defend against any
such loss, claim, damage, liability or action as such expenses are incurred. The
foregoing indemnity agreement is in addition to any liability which the
Underwriter may otherwise have to the Company or any such director, officer,
employee or controlling person.
(c) Promptly after receipt by an indemnified party under this
Section 8 of notice of any claim or the commencement of any action, the
indemnified party shall, if a claim in respect thereof is to be made against the
indemnifying party under this Section 8, notify the indemnifying party in
writing of the claim or the commencement of that action; provided, however, that
the failure to notify the indemnifying party shall not relieve it from any
liability which it may have under this Section 8 except to the extent it has
been materially prejudiced by such failure and, provided further, that the
failure to notify the indemnifying party shall not relieve it from any liability
which it may have to an indemnified party otherwise than under this Section 8.
If any such claim or action shall be brought against an indemnified party, and
it shall notify the indemnifying party thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it wishes, jointly with
any other similarly notified indemnifying party, to assume the defense thereof
with counsel reasonably satisfactory to the indemnified party. After notice from
the indemnifying party to the indemnified party of its election to assume the
defense of such claim or action, the indemnifying party shall not be liable to
the indemnified party under this Section 8 for any legal or other expenses
subsequently incurred by the indemnified party in connection with the defense
thereof other than reasonable costs of investigation; provided, however, that
the Underwriter shall have the right to employ counsel to represent the
Underwriter and its respective officers, employees and controlling persons who
may be subject to liability arising out of any claim in respect of which
indemnity may be sought by the Underwriter against the Company under this
Section 8 if, in the reasonable judgment of the Underwriter, it is advisable for
the Underwriter and those officers, employees and controlling persons to be
jointly represented by separate counsel, and in that event the fees and expenses
of such separate counsel shall be paid by the Company. No indemnifying party
shall (i) without the prior written consent of the indemnified parties (which
consent shall not be unreasonably withheld), settle or compromise or consent to
the entry of any judgment with respect to any pending or threatened claim,
action, suit or proceeding in respect of which indemnification or contribution
may be sought hereunder (whether or not the indemnified parties are actual or
potential parties to such claim or action) unless such settlement, compromise or
consent includes an unconditional release of each indemnified party from all
liability arising out of such claim, action, suit or proceeding, or (ii) be
liable for any settlement of any such action effected without its written
consent (which consent shall not be unreasonably withheld), but if settled with
the consent of the indemnifying party or if there be a final judgment of the
plaintiff in any such action, the indemnifying party agrees to indemnify and
hold harmless any indemnified party from and against any loss or liability by
reason of such settlement or judgment.
28
(d) If the indemnification provided for in this Section 8
shall for any reason be unavailable to or insufficient to hold harmless an
indemnified party under Section 8(a) or 8(b) in respect of any loss, claim,
damage or liability, or any action in respect thereof, referred to therein, then
each indemnifying party shall, in lieu of indemnifying such indemnified party,
contribute to the amount paid or payable by such indemnified party as a result
of such loss, claim, damage or liability, or action in respect thereof, (i) in
such proportion as shall be appropriate to reflect the relative benefits
received by the Company on the one hand and the Underwriter on the other from
the offering of the Shares or (ii) if the allocation provided by clause (i)
above is not permitted by applicable law, in such proportion as is appropriate
to reflect not only the relative benefits referred to in clause (i) above but
also the relative fault of the Company on the one hand and the Underwriter on
the other with respect to the statements or omissions which resulted in such
loss, claim, damage or liability, or action in respect thereof, as well as any
other relevant equitable considerations. The relative fault shall be determined
by reference to whether the untrue or alleged untrue statement of a material
fact or omission or alleged omission to state a material fact relates to
information supplied by the Company or the Underwriter, the intent of the
parties and their relative knowledge, access to information and opportunity to
correct or prevent such statement or omission. The Company and the Underwriter
agree that it would not be just and equitable if contributions pursuant to this
Section 8 were to be determined by pro rata allocation or by any other method of
allocation which does not take into account the equitable considerations
referred to herein. The amount paid or payable by an indemnified party as a
result of the loss, claim, damage or liability, or action in respect thereof,
referred to above in this Section 8(d) shall be deemed to include, for purposes
of this Section 8(d), any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any such action
or claim. Notwithstanding the provisions of this Section 8(d), the Underwriter
shall not 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 exceeds the amount of any damages which the Underwriter has otherwise
paid or become liable to pay by reason of any untrue or alleged untrue statement
or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation.
(e) The Underwriter confirms and the Company acknowledges that
the statements with respect to the public offering of the Shares by the
Underwriter set forth on the cover page of the Prospectus, the fourth paragraph
on page S-7 of the Prospectus and the paragraphs appearing in the "Underwriting"
section of the Prospectus under the captions "Over-Allotment Option," "Short
Positions and Penalty Bids" and "Electronic Distributions" are correct and
constitute the only information furnished in writing to the Company by or on
behalf of the Underwriter specifically for inclusion in the Registration
Statement and the Prospectus.
29
SECTION 9. Termination. The obligations of the Underwriter hereunder
may be terminated by the Underwriter by notice given to and received by the
Company prior to delivery of and payment for the Firm Shares if, prior to that
time, any of the events described in Sections 7(m), 7(n) and 7(o), shall have
occurred or if the Underwriter shall decline to purchase the Shares for any
reason permitted under this Agreement.
SECTION 10. Reimbursement of Underwriter's Expense. If the Company
shall fail to tender the Shares for delivery to the Underwriter by reason of any
failure, refusal or inability on the part of the Company to perform any
agreement on its part to be performed, or because any other condition of the
Underwriter's obligations hereunder required to be fulfilled by the Company is
not fulfilled, the Company will reimburse the Underwriter for all reasonable
out-of-pocket expenses (including fees and disbursements of counsel) incurred by
the Underwriter in connection with this Agreement and the proposed purchase of
the Shares, and upon demand the Company shall pay the full amount thereof to the
Underwriter.
SECTION 11. Notices, Etc. All statements, requests, notices and
agreements hereunder shall be in writing, and:
(a) if to the Underwriter, shall be delivered or sent by mail
or facsimile transmission to:
Xxxxxx Brothers Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Syndicate Registration Department
Fax: (000) 000-0000
Copy to:
Office of the General Counsel
Fax: (000) 000-0000
(b) if to the Company, shall be delivered or sent by mail or
facsimile transmission to:
Xxxxxxxxxxx International Ltd.
000 Xxxx Xxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
Attention: Xxxx X. Xxxxxx
Fax: (000) 000-0000
Copy to:
Xxxxxxx & Xxxxx L.L.P.
0000 Xxxxx Xxxxx, 000 Xxxxxx
00
Xxxxxxx, Xxxxx 00000
Attention: Xxxxxx X. Xxxxxx
Fax: (000) 000-0000
Any such statements, requests, notices or agreements shall take effect at the
time of receipt thereof.
SECTION 12. Persons Entitled to Benefit of Agreement. This Agreement
shall inure to the benefit of and be binding upon the Underwriter, the Company
and their respective successors. This Agreement and the terms and provisions
hereof are for the sole benefit of only those persons, except that (A) the
representations, warranties, indemnities and agreements of the Company contained
in this Agreement shall also be deemed to be for the benefit of the directors,
officers and employees of the Underwriter and the person or persons, if any, who
control the Underwriter within the meaning of Section 15 of the Securities Act
and (B) the indemnity agreement of the Underwriter contained in Section 8(b) of
this Agreement shall be deemed to be for the benefit of directors of the
Company, officers of the Company who have signed the Registration Statement and
any person controlling the Company within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act. Nothing in this Agreement is
intended or shall be construed to give any person, other than the persons
referred to in this Section 12, any legal or equitable right, remedy or claim
under or in respect of this Agreement or any provision contained herein.
SECTION 13. Survival. The respective indemnities, representations,
warranties and agreements of the Company and the Underwriter contained in this
Agreement or made by or on behalf on them, respectively, pursuant to this
Agreement, shall survive the delivery of and payment for the Shares and shall
remain in full force and effect, regardless of any investigation made by or on
behalf of any of them or any person controlling any of them.
SECTION 14. Definition of the Terms "BUSINESS DAY", "SIGNIFICANT
SUBSIDIARIES" and "SUBSIDIARY". For purposes of this Agreement, (a) "BUSINESS
DAY" means each Monday, Tuesday, Wednesday, Thursday or Friday which is not a
day on which banking institutions in New York are generally authorized or
obligated by law or executive order to close, (b) "Significant Subsidiary"
means, at any date, a consolidated subsidiary, the shares, interests, rights to
purchase, warrants, options, participations or other equivalents (however
designated) of such Person's equity, of which are owned by the Company and/or
one or more of its subsidiaries and that either (i) has total assets in excess
of 5% of the total assets of the Company and its consolidated subsidiaries, in
each case as determined in accordance with generally accepted accounting
principles as in effect from time to time as set forth in the opinions,
statements and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and the Financial Accounting Standards
Board or (ii) has gross net revenues in excess of 12.5% of the consolidated
31
gross revenues of the Company and its consolidated subsidiaries based, in each
case, on the most recent audited consolidated financial statements of the
Company, and (c) "SUBSIDIARY" has the meaning set forth in Rule 405 of the Rules
and Regulations.
SECTION 15. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of New York.
SECTION 16. Submission to Jurisdiction and Waiver. By the execution and
delivery of this Agreement, the Company submits to the non-exclusive
jurisdiction of any federal or New York State court located in the City of New
York in any suit or proceeding arising out of or relating to the Shares or this
Agreement. Each of the parties hereto hereby irrevocably and unconditionally
waives, to the fullest extent it may legally and effectively do so, any
objection which it may now or hereafter have to the laying of venue of any suit,
action or proceeding arising out of or relating to this Agreement in any New
York State or federal court in the City of New York, or any appellate court with
respect to any of the foregoing. Each of the parties hereto hereby irrevocably
waives, to the fullest extent permitted by law, the defense of an inconvenient
forum to the maintenance of such action or proceeding in any such court. To the
extent that the Company has or hereafter may acquire any immunity from
jurisdiction of any court (including, without limitation, any court in the
United States, the State of New York, Bermuda or any political subdivision
thereof) or from any legal process (whether through service of notice,
attachment prior to judgment, attachment in aid of execution, execution or
otherwise) with respect to itself or its property or assets, this Agreement, or
any other actions to enforce judgments in respect of any thereof, the Company
hereby irrevocably waives such immunity, and any defense based on such immunity,
in respect of its obligations under the above-referenced documents and the
transactions contemplated thereby, to the fullest extent permitted by law.
SECTION 17. Counterparts. This Agreement may be executed in one or more
counterparts and, if executed in more than one counterpart, the executed
counterparts shall each be deemed to be an original but all such counterparts
shall together constitute one and the same instrument.
SECTION 18. Headings. The headings herein are inserted for convenience
of reference only and are not intended to be part of, or to affect the meaning
or interpretation of, this Agreement.
[SIGNATURES ON FOLLOWING PAGE]
32
If the foregoing correctly sets forth the agreement between
the Company and the Underwriter, please indicate your acceptance in the space
provided for that purpose below.
Very truly yours,
XXXXXXXXXXX INTERNATIONAL LTD.
BY:
--------------------------------------------------
NAME:
------------------------------------------------
TITLE:
-----------------------------------------------
Accepted:
XXXXXX BROTHERS INC.
By
-------------------------------------------------
Authorized Representative
SCHEDULE 1
LIST OF SIGNIFICANT SUBSIDIARIES
List Company Name Jurisdiction
----------------- ------------
Xxxxxx Group Limited U.K.
Weatherford Artificial Lift Systems, Inc. Delaware, USA
Weatherford U.K. Ltd. U.K.
Xxxxxxxxxxx Xxxxxxx Xxxxxxxx Xxx.* Xxxxxxx
Xxxxxxxxxxx Xxxxxx Ltd.* Alberta, Canada
Weatherford Canada Partnership* Alberta, Canada
Weatherford Eurasia B.V. Netherlands
Weatherford Eurasia Limited U.K.
Weatherford Holding GmbH Germany
Xxxxxxxxxxx International, Inc. Delaware, USA
Weatherford Investment (Luxemborg) S.a.r.l. Luxembourg
Weatherford Luxembourg S.a.r.l. Luxembourg
Xxxxxxxxxxx Oil Tool GmbH Germany
Xxxxxxxxxxx Oil Tool Middle East Ltd. British Virgin Islands
Weatherford U.S. Holdings, L.L.C.* Delaware, USA
Weatherford U.S. L.P. Louisiana, USA
Weatherford/Xxxx, Inc. Delaware, USA
WEUS Holding, Inc. Delaware, USA
EXHIBIT A
LOCK-UP LETTER AGREEMENT
XXXXXX BROTHERS INC.
Three World Financial Center
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
The undersigned understands that you propose to enter into an
Underwriting Agreement (the "
PURCHASE AGREEMENT") providing for the purchase by
you of Common Shares (the "COMMON SHARES"), par value US$1.00 per share, of
Xxxxxxxxxxx International Ltd., a Bermuda exempted company (the "COMPANY"), and
that the Underwriter proposes to reoffer the Shares to the public (the
"OFFERING").
In consideration of the execution of the Underwriting Agreement by the
Underwriter, and for other good and valuable consideration, the undersigned
hereby irrevocably agrees that, without the prior written consent of Xxxxxx
Brothers Inc., which consent will not be unreasonably withheld, the undersigned
will not, directly or indirectly, (1) offer for sale, sell, pledge, or otherwise
dispose of (or enter into any transaction or device that is designed to, or
could be expected to, result in the disposition by any person at any time in the
future of) any Common Shares (including, without limitation, Common Shares that
may be deemed to be beneficially owned by the undersigned in accordance with the
rules and regulations of the Securities and Exchange Commission and Common
Shares that may be issued upon exercise of any option or warrant) or securities
convertible into or exchangeable for Common Shares owned by the undersigned on
the date of this Lock-Up Letter Agreement, or (2) enter into any swap or other
derivatives transaction that transfers to another, in whole or in part, any of
the economic benefits or risks of ownership of such shares of Common Shares,
whether any such transaction described in clause (1) or (2) above is to be
settled by delivery of Common Shares or other securities, in cash or otherwise,
for a period of 60 days after the date of the Prospectus Supplement relating to
the Offering; provided, however, that the restrictions in clauses (1) and (2)
above shall not apply to (x) any bona fide transfer of Common Shares or any
securities convertible into or exchangeable or exercisable for Common Shares to
a donee; provided, that (A) each donee shall execute and deliver to Xxxxxx
Brothers Inc. a duplicate form of this Lock-up Letter Agreement, and (B) such
transfer shall be for estate planning purposes or for charitable donations, or
(y) sales of Common Shares by the undersigned and the other individuals
executing similar letters to you on or about this date, in an aggregate amount
not to exceed 100,000 Common Shares.
In furtherance of the foregoing, the Company and its Transfer Agent are
hereby authorized to decline to make any transfer of securities if such transfer
would constitute a violation or breach of this Lock-Up Letter Agreement.
It is understood that, if the Company notifies you that it does not
intend to proceed with the Offering, if the
Purchase Agreement does not become
effective, or if the
Purchase Agreement (other than the provisions thereof which
survive termination) shall terminate or be terminated prior to payment for and
delivery of the Shares, I will be released from my obligations under this
Lock-Up Letter Agreement.
The undersigned understands that the Company and the Underwriter will
proceed with the Offering in reliance on this Lock-Up Letter Agreement.
Whether or not the Offering actually occurs depends on a number of
factors, including market conditions. Any Offering will only be made pursuant to
an
Purchase Agreement, the terms of which are subject to negotiation between the
Company and the Underwriter.
The undersigned hereby represents and warrants that the undersigned has
full power and authority to enter into this Lock-Up Letter Agreement and that,
upon request, the undersigned will execute any additional documents reasonably
necessary in connection with the enforcement hereof. Any obligations of the
undersigned shall be binding upon the heirs, personal representatives,
successors and assigns of the undersigned.
Very truly yours,
By:
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Name:
Title:
