EXHIBIT 1.2
UNDERWRITING AGREEMENT
(Preferred Stock, Depositary Shares, Common Stock)
[ ]
Comcast Corporation
0000 Xxxxxx Xxxxxx
Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000-0000
Dear Sirs:
We (the "Manager") are acting on behalf of the underwriter or underwriters
(including ourselves) named below (such underwriter or underwriters being herein
called the "Underwriters"), and we understand that Comcast Corporation, a
Pennsylvania corporation (the "Company"), proposes to issue and sell the number
of shares of its securities identified as Firm Securities herein (the "Firm
Securities"). The Company also proposes to issue and sell not more than the
number of shares of its securities, if any, identified as Additional Securities
herein (the "Additional Securities"), if and to the extent that we, as Manager
of this offering, shall have determined to exercise, on behalf of the
Underwriters, the right to purchase such Additional Securities granted to the
Underwriters herein. The Firm Securities and the Additional Securities are
hereinafter collectively referred to as the "Offered Securities."
Subject to the terms and conditions set forth or incorporated by reference
herein, the Company hereby agrees to sell and the Underwriters agree to
purchase, severally and not jointly, the aggregate principal amount of the Firm
Securities set forth below opposite their names at a purchase price of
$[ ], per Firm Security (the "Purchase Price").
Number of
Firm Securities
Underwriter To Be Purchased
----------- ---------------
[Insert syndicate list]
----------------
Total..................................................
================
Subject to the terms and conditions set forth or incorporated by reference
herein, the Company hereby agrees to sell to the Underwriters the Additional
Securities, and the Underwriters shall have a one-time right to purchase,
severally and not jointly, up to the number of Additional Securities set forth
below at the Purchase Price [plus accrued dividends, if any, from [ ]
to the date of payment and delivery]. Additional Securities may be purchased as
provided herein solely for the purpose of covering over-allotments made in
connection with the offering of the Firm Securities. If any Additional
Securities are to be
purchased, each Underwriter agrees, severally and not jointly, to purchase the
number of Additional Securities (subject to such adjustments to eliminate
fractional Offered Securities as you may determine) that bears the same
proportion to the total number of Additional Securities to be purchased as the
amount of Firm Securities set forth opposite the name of such Underwriter above
bears to the total amount of Firm Securities.
The Underwriters will pay for the Firm Securities upon delivery thereof at
the offices of Xxxxx Xxxx & Xxxxxxxx, 0000 Xx Xxxxxx Xxxx, Xxxxx Xxxx,
Xxxxxxxxxx at 10:00 a.m. (New York time) on [ ], or at such other time, not
later than 5:00 p.m. (New York time) on [ ], as shall be designated in writing
by the Underwriters and the Company. The time and date of such payment and
delivery are hereinafter referred to as the "Closing Date."
Payment for any Additional Securities shall be made at the offices referred
to above at 10:00 A.M. (New York time), on such date (which may be the same as
the Closing Date but shall in no event be earlier than the Closing Date nor
later than ten business days after the giving of the notice hereinafter referred
to) as shall be designated in a written notice from us to the Company of our
determination, on behalf of the Underwriters, to purchase an amount, specified
in said notice, of Additional Securities, as shall be designated in writing by
us. The time and date of such payment are hereinafter referred to as the "Option
Closing Date." The notice of the determination to exercise the option to
purchase Additional Securities and of the Option Closing Date may be given at
any time within 30 days after the date of the Underwriting Agreement.
The Offered Securities shall have the terms set forth in the Prospectus
dated December [ ], 2002, and the Prospectus Supplement dated [ ], including the
following:
Terms of Offered Securities
Securities:
Aggregate Number of Firm Securities:
Aggregate Number of Additional Securities:
Redemption Provisions:
Conversion Provisions:
Exchange Provisions:
Lock-Up Securities:
Lock-Up Period:
Additional Provisions:
[If depositary shares are offered, list beneficial ownership of preferred
stock that each depositary share represents and list Deposit Agreement.]
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Capitalized terms used above and not defined herein shall have the meanings
set forth in the Prospectus and Prospectus Supplement referred to above.
Except as set forth below, all provisions contained in the document
entitled Comcast Corporation Underwriting Agreement Standard Provisions
(Preferred Stock, Depositary Shares, Common Stock) dated December [ ], 2002,
(the "Standard Provisions"), a copy of which is attached hereto, are herein
incorporated by reference in their entirety and shall be deemed to be a part of
this Agreement to the same extent as if such provisions had been set forth in
full herein, except that (i) if any term defined in such document is otherwise
defined herein, the definition set forth herein shall control, (ii) all
references in such document to a type of security that is not an Offered
Security shall not be deemed to be a part of this Agreement and (iii) all
references in such document to a type of agreement that has not been entered
into in connection with the transactions contemplated hereby shall not be deemed
to be a part of this Agreement.
Please confirm your agreement by having an authorized officer sign a copy
of this Agreement in the space set forth below.
Very truly yours,
[Name of Lead Managers]
On behalf of themselves and the other
Underwriters named herein
By [ ]
-------------------------------
By:
---------------------------------
Name:
Title:
Accepted:
COMCAST CORPORATION
By:
--------------------------------------
Name:
Title:
3
COMCAST CORPORATION
UNDERWRITING AGREEMENT
STANDARD PROVISIONS
(PREFERRED STOCK, DEPOSITARY SHARES, COMMON STOCK)
[ ]
---------- --, ----
From time to time, Comcast Corporation, a Pennsylvania corporation (the
"Company"), may enter into one or more underwriting agreements that provide for
the sale of designated securities to the several underwriters named therein. The
standard provisions set forth herein may be incorporated by reference in any
such underwriting agreement (an "Underwriting Agreement"). The Underwriting
Agreement, including the provisions incorporated therein by reference, is herein
referred to as this Agreement. Terms defined in the Underwriting Agreement are
used herein as therein defined.
The Company proposes to issue from time to time (a) its preferred stock,
without par value (the "Preferred Stock"), (b) depositary shares representing
its Preferred Stock (the "Depositary Shares") and (c) its Class A common stock,
$0.01 par value (the "Class A Common Stock") and its Class A Special common
stock, $0.01 par value (the "Class A Special Common Stock", and together with
the Class A Common Stock, the "Common Stock").
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement including a prospectus relating to the
Preferred Stock, Depositary Shares and Common Stock (collectively, the
"Securities") and has filed with, or transmitted for filing to, or shall
promptly after the date of the Underwriting Agreement file with or transmit for
filing to, the Commission a prospectus supplement (the "Prospectus Supplement")
pursuant to Rule 424 under the Securities Act of 1933, as amended (the
"Securities Act"), specifically relating to the Securities offered pursuant to
this Agreement (the "Offered Securities"). The term Registration Statement means
the registration statement as amended to the date of the Underwriting Agreement
including any additional registration statement filed by the Company pursuant to
Rule 462(b). The term Basic Prospectus means the prospectus included in the
Registration Statement. The term Prospectus means the Basic Prospectus together
with the Prospectus Supplement. The term preliminary prospectus means a
preliminary prospectus supplement specifically relating to the Offered
Securities, together with the Basic Prospectus. As used herein, the terms "Basic
Prospectus", "Prospectus" and "preliminary prospectus" shall include in each
case the documents, if any, incorporated by reference therein. The terms
"supplement", "amendment" and "amend" as used herein shall include all documents
deemed to be incorporated by reference in the Prospectus that are filed
subsequent to the date of the Basic Prospectus by the Company with the
Commission pursuant to the Securities Exchange Act of 1934, as amended (the
"Exchange Act").
The Company hereby agrees that, without the prior written consent of the
Manager, it will not offer, sell, contract to sell or grant any option to
purchase or otherwise dispose of any shares of the Lock-Up Securities, or any
securities convertible into or exchangeable for Lock-Up Securities, for the
Lock-Up Period, other than (i) the Offered Securities to be sold hereunder,
(ii) any Lock-Up Securities sold upon the exercise of an option or warrant or
the conversion of a security outstanding on the date hereof or (iii) any Lock-Up
Securities issued pursuant to any stock option or similar employee compensation
plan in effect on the date hereof.
1. Representations and Warranties. The Company represents and warrants to
each of the Underwriters as of the date of the Underwriting Agreement that (i)
each document filed or to be filed pursuant to the Exchange Act and incorporated
by reference in the Prospectus complied or will comply when so filed in all
material respects with the Exchange Act and the rules and regulations of the
Commission thereunder and (ii) the Registration Statement and Prospectus comply
in all material respects with the Securities Act and the rules and regulations
of the Commission thereunder and do not contain any untrue statement of a
material fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein not misleading, except that the
foregoing representations and warranties do not apply to statements or omissions
in the Registration Statement or the Prospectus or any amendment or supplement
thereto based upon information furnished to the Company in writing by any
Underwriter through the Manager expressly for use therein.
2. Public Offering. The Company is advised by the Manager that the
Underwriters propose to make a public offering of their respective portions of
the Offered Securities as soon after this Agreement has been entered into as in
the Manager's judgment is advisable. The terms of the public offering of the
Offered Securities are set forth in the Prospectus.
3. Purchase and Delivery. Except as otherwise provided in this Section 3,
payment for the Offered Securities shall be made to the Company in Federal or
other funds immediately available in New York City at the time and place set
forth in the Underwriting Agreement, upon delivery to the Manager for the
respective accounts of the several Underwriters of the Offered Securities.
Certificates representing the Offered Securities shall be in definitive form and
registered in such names and in such denominations as the Manager shall request
in writing not less than one full business day prior to the date of delivery,
with any transfer taxes payable in connection with the transfer of the Offered
Securities to the Underwriters duly paid.
4. Conditions to Closing. The several obligations of the Underwriters
hereunder are subject to the following conditions:
(a) No stop order suspending the effectiveness of the Registration
Statement shall be in effect, and no proceedings for such purpose shall be
pending before or threatened by the Commission, and there shall have been
no material adverse change in the condition, business or operations of the
Company and its subsidiaries, as a whole, from that set forth in the
Prospectus; and the Manager shall have received, on the Closing Date, a
certificate, dated the Closing Date and signed by an executive officer of
the Company, to the foregoing effect. Such certificate will also provide
that the representations and warranties of the Company contained herein are
true and correct as of the Closing Date. The officer making such
certificate may rely upon the best of his knowledge as to proceedings
threatened.
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(b) The Manager shall have received on the Closing Date an opinion of
Xxxxxx X. Block, Esquire, Senior Vice President of the Company, dated the
Closing Date, to the effect that:
(i) the Company has been duly incorporated, is validly existing
as a corporation subsisting under the laws of the Commonwealth of
Pennsylvania and is duly qualified to transact business and is in good
standing in each jurisdiction in which the conduct of its business or
its ownership or leasing of property requires such qualification
(except where the failure to so qualify would not have a material
adverse effect upon the business or financial condition of the Company
and its subsidiaries, as a whole),
(ii) the Offered Securities have been duly authorized, and when
executed and delivered to and paid for by the Underwriters in
accordance with the terms of this Agreement, will be validly issued,
fully paid and non-assessable,
(iii) this Agreement has been duly authorized, executed and
delivered by the Company,
(iv) except as rights to indemnity and contribution under this
Agreement may be limited under applicable law, the execution, delivery
and performance of this Agreement by the Company and the issuance and
sale of the Offered Securities by the Company will not contravene any
provision of applicable law of the United States (except with respect
to laws relating specifically to the cable communications industry, as
to which such counsel is not called upon to express any opinion),
Pennsylvania, or, to the best knowledge of such counsel, of any other
state or jurisdiction of the United States or of any foreign
jurisdiction (in which foreign jurisdiction the Company or any
specified subsidiary does business which is material to the Company
and its subsidiaries, as a whole), or the articles of incorporation or
by-laws of the Company or, to the best knowledge of such counsel, any
agreement or other instrument binding upon the Company, and, except
for the orders of the Commission making the Registration Statement
effective (which have been obtained) and such permits or similar
authorizations required under the securities or Blue Sky laws of
certain states or foreign jurisdictions (as to which such counsel is
not called upon to express any opinion), no consent, approval or
authorization of any governmental body or agency of the United States
(except with respect to consents, approvals and authorizations
relating specifically to the cable communications industry, as to
which such counsel is not called upon to express any opinion),
Pennsylvania, or, to the best knowledge of such counsel, of any other
state or jurisdiction of the United States or of any foreign
jurisdiction is required for the performance of this Agreement by the
Company, or the issuance and sale of the Offered Securities by the
Company,
(v) subject to such qualification as may be set forth in the
Prospectus, the Company and its subsidiaries have, and are in material
compliance with, such franchises, and to the best knowledge of such
counsel after reasonable
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investigation, such licenses and authorizations, as are necessary to
own their cable communications properties and to conduct their cable
communications business in the manner described in the Prospectus,
except where the failure to have, or comply with, such franchises,
licenses and authorizations would not have a material adverse effect
on the business or financial condition of the Company and its
subsidiaries, as a whole, and such franchises, licenses and
authorizations contain no materially burdensome restrictions not
adequately described in the Prospectus, which restrictions would have
a material adverse effect on the business or financial condition of
the Company and its subsidiaries, as a whole,
(vi) the statements (A) in Item 3 of the Company's most recent
Annual Report on Form 10-K incorporated by reference in the
Prospectus, (B) in Part II, Item 1 under the caption "Legal
Proceedings" of the Company's most recent Quarterly Report on Form
10-Q incorporated by reference in the Prospectus and (C) in the
Registration Statement in Item 15, insofar as such statements
constitute a summary of the legal matters, documents or proceedings
referred to therein, fairly present the information called for with
respect to such legal matters, documents and proceedings,
(vii) such counsel does not know of any legal or governmental
proceeding pending or threatened to which the Company or any of its
subsidiaries is a party or to which any of the properties of the
Company or any of its subsidiaries is subject which is required to be
described in the Registration Statement or the Prospectus and is not
so described or of any contract or other document which is required to
be described in the Registration Statement or the Prospectus or to be
filed as an exhibit to the Registration Statement which is not
described or filed as required,
(viii) the security into which the Offered Securities are
convertible, initially reserved for issuance upon conversion of the
Offered Securities (the "Underlying Securities") have been duly
authorized and reserved for issuance, and
(ix) when the Underlying Securities are issued upon conversion of
the Offered Securities in accordance with the terms of the Offered
Securities, such Underlying Securities will be validly issued, fully
paid and non-assessable and will not be subject to any preemptive or
other right to subscribe for or purchase such Underlying Securities.
Such counsel shall also state that no facts have come to his attention that
lead him to believe (1) that the Registration Statement or any amendments
thereto (except for the financial statements and other financial or statistical
data included or incorporated by reference therein or omitted therefrom, as to
which such counsel is not called upon to express any belief), on the date on
which it became effective or the date of filing of the most recent subsequent
Annual Report on Form 10-K, contained an untrue statement of a material fact or
omitted to state a material fact required to be stated therein or necessary to
make the statements therein not misleading; (2) that
the Prospectus, as amended or supplemented, if applicable (except for the
financial statements and other financial or statistical data included or
incorporated by reference therein or omitted therefrom, as to which such counsel
is not called upon to express any belief), at the date of the Underwriting
Agreement or at the Closing Date, contained or contains an untrue statement of a
material fact or omitted or omits to state a material fact necessary in order to
make the statements therein, in the light of the circumstances under which they
are made, not misleading; or (3) that the documents incorporated by reference in
the Prospectus (except for the financial statements and other financial or
statistical data included or incorporated by reference therein or omitted
therefrom, as to which such counsel is not called upon to express any belief),
as of the dates they were filed with the Commission, contained an untrue
statement of a material fact or omitted to state a material fact necessary in
order to make the statements therein, in the light of the circumstances under
which they are made, not misleading.
With respect to the preceding paragraph, such counsel may state that his
opinion and belief is based upon his participation in the preparation of the
Registration Statement, Prospectus (as amended or supplemented) and the
documents incorporated therein by reference and review and discussion of the
contents thereof, but is without independent check or verification except as
specified.
In expressing his opinion as to questions of the law of jurisdictions other
than the Commonwealth of Pennsylvania and the United States, such counsel may
rely to the extent reasonable on such counsel as may be reasonably acceptable to
counsel to the Underwriters. In addition, such counsel may reasonably rely as to
questions of fact on certificates of responsible officers of the Company.
(c) The Manager shall have received on the Closing Date an opinion of
Xxxxx Xxxx & Xxxxxxxx, special counsel for the Company, dated the Closing
Date, to the effect that:
(i) except as rights to indemnity and contribution under this
Agreement may be limited under applicable law, the execution, delivery
and performance of this Agreement by the Company and the issuance and
sale of the Offered Securities by the Company will not contravene any
provision of applicable law of the United States (except with respect
to laws relating specifically to the cable communications industry, as
to which such counsel is not called upon to express any opinion), or
New York and, except for the orders of the Commission making the
Registration Statement effective (which have been obtained) and such
permits or similar authorizations required under the securities or
Blue Sky laws of certain states or foreign jurisdictions (as to which
such counsel is not called upon to express any opinion), no consent,
approval or authorization of any governmental body or agency of the
United States (except with respect to consents, approvals and
authorizations relating specifically to the cable communications
industry, as to which such counsel is not called upon to express any
opinion), or New York is required for the performance of this
Agreement by the Company, or the issuance and sale of the Offered
Securities by the Company, and
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(ii) the statements in the Prospectus Supplement under
"Description of [the Offered Securities]", "Certain U.S. Tax
Considerations" and "Underwriting" and in the Basic Prospectus under
"Description of [the Offered Securities]" and "Plan of Distribution",
insofar as such statements constitute a summary of the legal matters
or documents referred to therein, fairly present the information
called for with respect to such legal matters and documents.
Such counsel shall also state that no facts have come to the attention of
such counsel that lead them to believe (1) that the Registration Statement and
the Prospectus and any supplements or amendments thereto or the documents
incorporated by reference in the Registration Statement and Prospectus (except
for financial statements and other financial or statistical data included or
incorporated by reference therein, as to which such counsel is not called upon
to express any belief) did not comply as to form in all material respects with
the Securities Act and the rules and regulations of the Commission thereunder;
(2) that the Registration Statement or any amendment thereto (except for the
financial statements and other financial or statistical data included or
incorporated by reference therein or omitted therefrom, as to which such counsel
is not called upon to express any belief) at the date of the Underwriting
Agreement contained an untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading; or (3) that the Prospectus, as amended or supplemented,
if applicable (except for the financial statements and other financial or
statistical data included or incorporated by reference therein or omitted
therefrom, as to which such counsel is not called upon to express any belief),
at the date hereof or at the Closing Date, contained or contains an untrue
statement of a material fact or omitted or omits to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they are made, not misleading.
With respect to the preceding paragraph, Xxxxx Xxxx & Xxxxxxxx may state
that their opinion and belief is based upon their participation in the
preparation of the Registration Statement and Prospectus and any amendments or
supplements thereto (but not including documents incorporated therein by
reference) and review and discussion of the contents thereof (including
documents incorporated therein by reference), but is without independent check
or verification except as specified.
(d) The Manager shall have received on the Closing Date an opinion of
[ ], internal counsel for the Company, dated the Closing Date, to the
effect that:
(i) no approval of the Federal Communications Commission (the
"FCC") is required in connection with the issuance and sale of the
Offered Securities,
(ii) the execution and delivery of this Agreement, by the
Company, the fulfillment of the terms set forth herein by the Company
and the consummation of the transactions contemplated hereby by the
Company do not violate any statute, regulation or other law of the
United States relating specifically to the cable communications
industry (except as otherwise explicitly set forth in the Prospectus)
or, to the knowledge of such counsel, any order,
6
judgment or decree of any court or governmental body of the United
States relating specifically to the cable communications industry and
applicable to the Company or any subsidiary, and which violation would
have a material adverse effect on the business or financial condition
of the Company and its subsidiaries, as a whole,
(iii) the statements in the Company's most recent Annual Report
on Form 10-K incorporated by reference in the Registration Statement
and Prospectus [identify sections describing cable regulatory matters]
as updated by the Company's most recent Quarterly Reports on Form 10-Q
incorporated in the Registration Statement and Prospectus and as
updated by the Prospectus, insofar as they are, or refer to,
statements of federal law or legal conclusions, have been reviewed by
such counsel and present in all material respects the information
called for with respect to such statements of federal law or legal
conclusions, and
(iv) such counsel does not know of any proceeding pending before
the FCC to which the Company or any of its subsidiaries is a party or
involving the cable communications properties, licenses or
authorizations of the Company and its subsidiaries, or of any cable
communications law or regulation relevant thereto required to be
described in the Registration Statement or Prospectus pursuant to
Regulation S-K promulgated under the Securities Act, which is not
described as required.
(e) The Manager shall have received on the Closing Date an opinion of
Xxxxxx Xxxxxx & Xxxxxxx, counsel for the Underwriters, dated the Closing
Date, covering the matters requested by and in form and substance
reasonably satisfactory to the Manager.
(f) The Manager shall have received on the Closing Date, a letter
dated the Closing Date, in each case in form and substance satisfactory to
the Manager, from (i) Deloitte & Touche LLP, independent public
accountants, containing statements and information of the type ordinarily
included in accountants' "comfort letters" to underwriters with respect to
the financial statements and certain financial information reviewed by them
contained in or incorporated by reference in the Registration Statement and
the Prospectus and (ii) each other firm of independent accountants, if any,
who audited or reviewed financial statements contained in or incorporated
by reference in the Registration Statement and the Prospectus, containing
statements and information of the type ordinarily included in accountants'
"comfort letters" to underwriters with respect to such financial statements
and financial information.
(g) The Manager shall have received on the date hereof or on the
Closing Date, as applicable, such additional documents as the Manager shall
have reasonably requested to confirm compliance with the conditions to
Closing listed herein.
The several obligations of the Underwriters to purchase Additional
Securities hereunder are subject to the delivery to the Manager on the Option
Closing Date of such opinions, certificates and documents as are contemplated
for the Closing of the Firm Securities in this Section 4.
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5. Covenants of the Company. In further consideration of the agreements of
the Underwriters herein contained, the Company covenants as follows:
(a) To furnish to the Manager, without charge, a copy of the
Registration Statement and two signed copies of any post-effective
amendment thereto specifically relating to the Offered Securities
(including exhibits thereto and documents incorporated therein by
reference) and, during the period mentioned in paragraph (c) below, as many
copies of the Prospectus, any documents incorporated therein by reference
and any supplements and amendments thereto as the Manager may reasonably
request.
(b) Before amending or supplementing the Registration Statement or the
Prospectus, to furnish the Manager a copy of each such proposed amendment
or supplement.
(c) If, during such period after the first date of the public offering
of the Offered Securities during which in the opinion of counsel to the
Manager the Prospectus is required by law to be delivered in connection
with sales by an Underwriter or dealer, any event shall occur as a result
of which it is necessary to amend or supplement the Prospectus in order to
make the statements therein, in the light of the circumstances existing at
the time, not misleading, forthwith to prepare and furnish, at its expense,
to the Underwriters and to the dealers (whose names and addresses the
Manager will furnish to the Company) to which Offered Securities may have
been sold by the Manager on behalf of the Underwriters and to any other
dealers on request, either amendments or supplements to the Prospectus so
that the statements in the Prospectus as so amended or supplemented will
not, in the light of the circumstances existing at the time, be misleading.
(d) To endeavor to qualify the Offered Securities for offer and sale
under the securities or Blue Sky laws of such U.S. jurisdictions as the
Manager shall reasonably request.
(e) To make generally available to the Company's security holders as
soon as practicable an earnings statement covering the twelve month period
beginning on the first day of the first fiscal quarter commencing after the
date hereof, which shall satisfy the provisions of Section 11(a) of the
Securities Act and the rules and regulations of the Commission thereunder
(which may be accomplished by making generally available the Company's
financial statements in the manner provided for by Rule 158 of the
Securities Act).
6. Indemnification and Contribution. The Company agrees to indemnify and
hold harmless each Underwriter and each person, if any, who controls each
Underwriter within the meaning of either Section 15 of the Securities Act or
Section 20 of the Exchange Act from and against any and all losses, claims,
damages and liabilities caused by any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement or the
Prospectus (as amended or supplemented) or any preliminary prospectus, or caused
by any omission or alleged omission to state therein a material fact necessary
to make the statements therein not misleading, except insofar as such losses,
claims, damages or liabilities are caused by
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any such untrue statement or omission or alleged untrue statement or omission
based upon information furnished to the Company in writing by such Underwriter
through the Manager expressly for use therein; provided, however, that the
foregoing indemnity agreement with respect to any preliminary prospectus shall
not inure to the benefit of any Underwriter from whom the person asserting any
such losses, claims, damages or liabilities purchased Offered Securities, or any
person controlling any such Underwriter, if a copy of the Prospectus (as then
amended or supplemented) was not sent or given by or on behalf of such
Underwriter to such person, if required by law so to have been delivered, at or
prior to the written confirmation of the sale of the Offered Securities to such
person, and if the Prospectus (as so amended or supplemented but without
reference to documents incorporated by reference therein) would have cured the
defect giving rise to such loss, claim, damage or liability.
Each Underwriter agrees to indemnify and hold harmless the Company, its
directors, its officers who sign the Registration Statement and each person, if
any, who controls the Company within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act to the same extent as the
foregoing indemnity from the Company to such Underwriter, but only with
reference to information relating to such Underwriter furnished to the Company
in writing by such Underwriter through the Manager expressly for use in the
Registration Statement, the Prospectus, any amendment or supplement thereto, or
any preliminary prospectus.
In case any proceeding (including any governmental investigation) shall be
instituted involving any person in respect of which indemnity may be sought
pursuant to either of the two preceding paragraphs, such person (hereinafter
called the "indemnified party") shall promptly notify the person against whom
such indemnity may be sought (hereinafter called the "indemnifying party") in
writing and the indemnifying party, upon request of the indemnified party, shall
retain counsel reasonably satisfactory to the indemnified party to represent the
indemnified party and any others the indemnifying party may designate in such
proceeding and shall pay the fees and disbursements of such counsel related to
such proceeding. In any such proceeding, any indemnified party shall have the
right to retain its own counsel, but the fees and expenses of such counsel shall
be at the expense of such indemnified party unless (i) the indemnifying party
and the indemnified party shall have mutually agreed to the retention of such
counsel or (ii) the named parties to any such proceeding (including any
impleaded parties) include both the indemnifying party and the indemnified party
and representation of both parties by the same counsel would be inappropriate
due to actual or potential differing interests between them. It is understood
that the indemnifying party shall not, in connection with any proceeding or
related proceedings in the same jurisdiction, be liable for the reasonable fees
and expenses of more than one separate firm (in addition to any local counsel)
for all such indemnified parties and that all such fees and expenses shall be
reimbursed as they are incurred. In the case of any such separate firm for the
Underwriters and such control persons of the Underwriters, such firm shall be
designated in writing by the Manager. In the case of any such separate firm for
the Company and such directors, officers and controlling persons of the Company,
such firm shall be designated in writing by the Company. The indemnifying party
shall not be liable for any settlement of any proceeding effected without its
written consent, but if settled with such consent or if there be a final
judgment for the plaintiff, the indemnifying party agrees to indemnify, to the
extent provided in the two immediately preceding paragraphs, the indemnified
party from and against any loss or liability by reason of such settlement or
judgment. No indemnifying party shall, without the prior written consent of the
indemnified party, effect any settlement of any
9
pending or threatened proceeding in respect of which any indemnified party is or
could have been a party and indemnity could have been sought hereunder by such
indemnified party, unless such settlement includes an unconditional release of
such indemnified party from all liability on claims that are the subject matter
of such proceeding.
If the indemnification provided for in the second or third paragraph of
this Section 6 is unavailable to an indemnified party in respect of any losses,
claims, damages or liabilities for which indemnification is provided herein,
then the indemnifying party, in lieu of indemnifying such indemnified party,
shall contribute to the amount paid or payable by such indemnified party as a
result of such losses, claims, damages or liabilities (i) in such proportion as
is appropriate to reflect the relative benefits received by the Company and the
Underwriters from the offering of the Offered Securities 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 and
of the Underwriters in connection with the statements or omissions which
resulted in such losses, claims, damages or liabilities, as well as any other
relevant equitable considerations. The relative benefits received by the Company
and the Underwriters shall be deemed to be in the same respective proportions as
the net proceeds from the offering (before deducting expenses) received by the
Company bear to the total underwriting discounts and commissions received by the
Underwriters in respect thereof. The relative fault of the Company and the
Underwriters shall be determined by reference to, among other things, whether
the untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information supplied by the
Company or by the Underwriters and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission.
The Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 6 were determined by pro rata
allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take account of the
equitable considerations referred to in the immediately preceding paragraph. The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages and liabilities referred to in the immediately preceding
paragraph shall be deemed to include, subject to the limitations set forth
above, 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 6, the Underwriters shall not be
required to contribute any amount in excess of the amount by which the total
price at which the Offered Securities underwritten by it and distributed to the
public were offered to the public exceeds the amount of any damages which the
Underwriters have otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation.
The indemnity and contribution agreement contained in this Section 6 and
the representations and warranties of the Company contained in this Agreement
shall remain operative and in full force and effect regardless of (i) any
termination of this Agreement, (ii) any investigation made by or on behalf of
the Underwriters or any person controlling the
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Underwriters or by or on behalf of the Company, its officers or directors or any
other person controlling the Company and (iii) acceptance of and payment for any
of the Offered Securities.
7. Termination. This Agreement shall be subject to termination in the
absolute discretion of the Manager by notice given by the Manager to the
Company, if (a) after the execution and delivery of the Underwriting Agreement
and prior to the Closing Date [or the Option Closing Date, as the case may be,]
(i) trading generally shall have been suspended or materially limited on or by,
as the case may be, the New York Stock Exchange, the American Stock Exchange, or
the National Association of Securities Dealers, Inc., (ii) trading of any
securities of the Company shall have been suspended on the Nasdaq National
Market, (iii) a general moratorium on commercial banking activities in New York
shall have been declared by either Federal or New York State authorities, or
(iv) there shall have occurred any outbreak or escalation of hostilities or any
change in financial markets or any calamity or crisis that, in the judgment of
the Manager, is material and adverse and (b) in the case of any of the events
specified in clauses (a)(i) through (iv), such event, singly or together with
any other such event, makes it, in the judgment of the Manager, impracticable to
market the Offered Securities on the terms and in the manner contemplated in the
Prospectus.
The Company will pay and bear all costs and expenses incident to the
performance of its obligations under this Agreement, including (a) the
preparation, printing and filing of the Registration Statement (including
financial statements and exhibits), as originally filed and as amended, the
preliminary prospectuses and the Prospectus and any amendments or supplements
thereto, and the cost of furnishing copies thereto to the Underwriters, (b) the
preparation, printing and distribution of this Agreement and Blue Sky
Memorandum, (c) the delivery of the Offered Securities to the Underwriters, (d)
the reasonable fees and disbursements of the Company's counsel and accountants,
(e) the qualification of the Offered Securities under the applicable state
securities or Blue Sky laws in accordance with Section 5, including filing fees
and reasonable fees and disbursements of counsel for the Underwriters in
connection therewith and in connection with any Blue Sky survey and any legal
investment survey, (f) all fees payable to the National Association of
Securities Dealers, Inc. in connection with the review, if any, of the offering
of the Securities and (g) any fees charged by rating agencies for the rating of
the Offered Securities. Except as specifically provided elsewhere herein, the
Underwriters will pay all of their own costs and expenses, including without
limitation the fees and expenses of their counsel and the expenses of selling
presentations.
If this Agreement shall be terminated by the Underwriters because of any
failure or refusal on the part of the Company to comply with the terms or to
fulfill any of the conditions of this Agreement, or if for any reason the
Company shall be unable to perform its obligations under this Agreement, the
Company will reimburse the Underwriters for all out-of-pocket expenses
(including the fees and disbursements of their counsel) reasonably incurred by
the Underwriters in connection with this Agreement or the offering contemplated
hereunder. This provision shall survive the termination or cancellation of this
Agreement.
8. Defaulting Underwriters. If on the Closing Date [or the Option Closing
Date, as the case may be,] any one or more of the Underwriters shall fail or
refuse to purchase Offered Securities that it has or they have agreed to
purchase on such date, and the aggregate amount of Offered Securities which such
defaulting Underwriter or Underwriters agreed but failed or
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refused to purchase is not more than one-tenth of the aggregate amount of the
Offered Securities to be purchased on such date, the other Underwriters shall be
obligated severally in the proportions that the amount of Offered Securities set
forth opposite their respective names bears to the aggregate amount of Offered
Securities set forth opposite the names of all such non-defaulting Underwriters,
or in such other proportions as the Manager may specify, to purchase the Offered
Securities which such defaulting Underwriter or Underwriters agreed but failed
or refused to purchase on such date; provided that in no event shall the amount
of Offered Securities that any Underwriter has agreed to purchase pursuant to
this Agreement be increased pursuant to this Section 8 by an amount in excess of
one-ninth of such amount of Offered Securities without the written consent of
such Underwriter. If on the Closing Date [or the Option Closing Date, as the
case may be,] any Underwriter or Underwriters shall fail or refuse to purchase
Offered Securities and the aggregate amount of Offered Securities with respect
to which such default occurs is more than one-tenth of the aggregate amount of
Offered Securities to be purchased on such date, and arrangements satisfactory
to the Manager and the Company for the purchase of such Offered Securities are
not made within 36 hours after such default, this Agreement shall terminate
without liability on the part of any non-defaulting Underwriter or the Company.
In any such case either the Manager or the Company shall have the right to
postpone the Closing Date [or the Option Closing Date, as the case may be,] but
in no event for longer than seven days, in order that the required changes, if
any, in the Registration Statement and in the Prospectus or in any other
documents or arrangements may be effected. Any action taken under this paragraph
shall not relieve any defaulting Underwriter from liability in respect of any
default of such Underwriter under this Agreement.
9. Counterparts. The Underwriting Agreement may be signed in any number of
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.
10. Applicable Law. This Agreement shall be governed by and construed in
accordance with the internal laws of the State of New York.
11. Headings. The headings of the sections of this Agreement have been
inserted for convenience of reference only and shall not be deemed a part of
this Agreement.
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