EXHIBIT 1.1
20,635,000 Shares
COEUR D'XXXXX XXXXX CORPORATION
Common Stock
UNDERWRITING AGREEMENT
September 11, 2003
CIBC WORLD MARKETS CORP.
ORION SECURITIES (U.S.A.) INC.
SPROTT SECURITIES (USA) LIMITED
c/o CIBC World Markets Corp.
000 0xx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Coeur d'Xxxxx Xxxxx Corporation, an Idaho corporation (the
"Company"), proposes, subject to the terms and conditions contained herein, to
sell to you (the "Underwriters") an aggregate of 20,635,000 shares (the "Firm
Shares") of the Company's common stock, $1.00 par value per share (the "Common
Stock"). All of the Firm Shares are to be issued and sold by the Company. The
amount of the Firm Shares to be purchased by each of the Underwriters is set
forth opposite its name on Schedule I hereto. In addition, the Company proposes
to grant to the Underwriters an option to purchase up to an additional 3,095,250
shares (the "Option Shares") of Common Stock from the Company for the purpose of
covering over-allotments in connection with the sale of the Firm Shares. The
Firm Shares and the Option Shares are collectively called the "Shares."
The Company has prepared and filed in conformity with the
requirements of the Securities Act of 1933, as amended (the "Securities Act"),
and the published rules and Regulations thereunder (the "Rules") adopted by the
Securities and Exchange Commission (the "Commission") a registration statement
on Form S-3 (No. 333-101434), including a related prospectus (the "Base
Prospectus") relating to common stock, warrants, preferred stock and certain
debt securities of the Company that may be sold from time to time by the Company
in accordance with Rule 415 of the Securities Act, and such amendments thereof
as may have been required to the date of this Agreement, including Amendment No.
1 and Amendment No. 2 to such Registration Statement. Copies of such
Registration Statement (including all amendments thereof and all documents
deemed incorporated by reference therein) and of the related Base Prospectus
have heretofore been delivered by the Company or are otherwise available to you.
The term "Registration Statement" as used in this Agreement means the
registration statement, including all financial statements, exhibits and
documents filed therewith or incorporated by
reference therein, as amended from time to time. The term "Preliminary
Prospectus" means any preliminary prospectus included in the Registration
Statement or filed with the Commission pursuant to Rule 424 of the rules and
regulations of the Commission under the Securities Act, or any preliminary
prospectus supplement used prior to the filing of the Prospectus Supplement (as
defined below). The term "Prospectus" means the Base Prospectus, any Preliminary
Prospectus and any amendments or further supplements to such prospectus,
including, without limitation, the final prospectus supplement (the "Prospectus
Supplement"), filed pursuant to Rule 424(b) with the Commission in connection
with the proposed sale of the Shares contemplated by this Agreement through the
date of such Prospectus Supplement. The term "Effective Date" shall mean each
date that the Registration Statement and any post-effective amendment or
amendments thereto became or become effective. Unless otherwise stated herein,
any reference herein to the Registration Statement and the Prospectus shall be
deemed to refer to and include the documents incorporated by reference therein
pursuant to Item 12 of Form S-3 under the Securities Act, which were filed under
the Securities Exchange Act of 1934, as amended (the "Exchange Act") on or
before the date hereof or are so filed hereafter. Any reference herein to the
terms "amend," "amendment" or "supplement" with respect to the Registration
Statement or the Prospectus shall be deemed to refer to and include any such
document filed or to be filed under the Exchange Act after the date of the
Registration Statement or Prospectus, as the case may be, and deemed to be
incorporated therein by reference.
The Company understands that the Underwriters propose to make
a public offering of the Shares, as set forth in and pursuant to the Prospectus,
as soon after each Closing Date (as defined below) and the date of this
Agreement as the Underwriters deem advisable. The Company hereby confirms that
the Underwriters and dealers have been authorized to distribute or cause to be
distributed each Prospectus and are authorized to distribute the Prospectus (as
from time to time amended or supplemented if the Company furnishes amendments or
supplements thereto to the Underwriters).
1. Sale, Purchase, Delivery and Payment for the Shares. On the
basis of the representations, warranties and agreements contained in, and
subject to the terms and conditions of, this Agreement:
(a) The Company agrees to issue and sell to the Underwriters,
and each of the Underwriters agrees to purchase from the Company, at a
purchase price of $3.2215 per share (the "Initial Price"), the number
of Firm Shares set forth opposite the name of such Underwriter under
the column "Number of Firm Shares to be Purchased from the Company" on
Schedule I to this Agreement, subject to adjustment in accordance with
Section 8 hereof.
(b) The Company hereby grants to the Underwriters an option to
purchase all or any part of the Option Shares at the Initial Price.
Such option may be exercised only to cover over-allotments in the sales
of the Firm Shares by the Underwriters and may be exercised in whole or
in part at any time on or before 12:00 noon, New York City time, on the
business day before the Firm Shares Closing Date (as defined below),
and from time to time thereafter within 30 days after the date of this
Agreement, in each case upon written, facsimile or telegraphic notice,
or verbal or telephonic notice confirmed by written, facsimile or
telegraphic notice, by the Underwriters to the Company no later than
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12:00 noon, New York City time, on the business day before the Firm
Shares Closing Date or at least two business days before the Option
Shares Closing Date (as defined below), as the case may be, setting
forth the number of Option Shares to be purchased and the time and date
(if other than the Firm Shares Closing Date) of such purchase.
(c) Payment of the purchase price for, and delivery of
certificates for, the Firm Shares shall be made at the offices of CIBC
World Markets Corp., 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, at
10:00 a.m., New York City time, on the third business day following the
date of this Agreement or at such time on such other date, not later
than ten (10) business days after the date of this Agreement, as shall
be agreed upon by the Company and the Underwriters (such time and date
of delivery and payment are called the "Firm Shares Closing Date"). In
addition, in the event that any or all of the Option Shares are
purchased by the Underwriters, payment of the purchase price, and
delivery of the certificates, for such Option Shares shall be made at
the above-mentioned offices, or at such other place as shall be agreed
upon by the Underwriters and the Company, on each date of delivery as
specified in the notice from the Underwriters to the Company (such time
and date of delivery and payment are called the "Option Shares Closing
Date"). The Firm Shares Closing Date and any Option Shares Closing Date
are called, individually, a "Closing Date" and, together, the "Closing
Dates."
(d) Payment shall be made to the Company by wire transfer of
immediately available funds against delivery of the respective
certificates to the Underwriters of certificates for the Shares to be
purchased by them.
(e) Certificates evidencing the Shares shall be registered in
such names and shall be in such denominations as the Underwriters shall
request at least two full business days before the Firm Shares Closing
Date or, in the case of Option Shares, on the day of notice of exercise
of the option as described in Section 1(b) and shall be delivered by or
on behalf of the Company to the Underwriters through the facilities of
the Depository Trust Company ("DTC") for the accounts of the
Underwriters. The Company will cause the certificates representing the
Shares to be made available for checking and packaging, at such place
as is designated by the Underwriters, on the full business day before
the Firm Shares Closing Date (or the Option Shares Closing Date in the
case of the Option Shares).
2. Representations and Warranties of the Company. The Company
represents and warrants to each Underwriter as of the date hereof, as of the
Firm Shares Closing Date and as of each Option Shares Closing Date (if any), as
follows:
(a) The Company meets the requirements for use of Form S-3
under the Securities Act and has filed with the Commission the
Registration Statement on such Form, including a Base Prospectus, for
registration under the Securities Act of the offering and sale of the
Shares, and amendments to such Registration Statement have been so
filed, including Amendment No. 1 and Amendment No. 2 to the
Registration Statement, and the Company has used a Preliminary
Prospectus. Such Registration Statement, as so amended and
supplemented, is effective. When the Registration Statement or any
amendment thereof or supplement thereto was or is declared effective,
it
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(i) complied or will comply, in all material respects, with the
requirements of the Securities Act and the Rules and the Exchange Act
and the rules and regulations of the Commission thereunder and (ii) did
not contain any untrue statement of a material fact or omit to state
any material fact required to be stated therein or necessary in order
to make the statements therein not misleading. When any related
Preliminary Prospectus was first filed with the Commission (whether
filed as part of the Registration Statement or any amendment thereto or
pursuant to Rule 424(a) of the Rules) and when any amendment thereof or
supplement thereto was first filed with the Commission, such
Preliminary Prospectus as amended or supplemented complied in all
material respects with the applicable provisions of the Securities Act
and the Rules and did not contain any untrue statement of a material
fact or omit to state any material fact required to be stated therein
or necessary in order to make the statements therein not misleading. If
applicable, each Preliminary Prospectus and the Prospectus delivered to
the Underwriters for use in connection with this offering was identical
to the electronically transmitted copies thereof filed with the
Commission pursuant to XXXXX, except to the extent permitted by
Regulation S-T. Notwithstanding the foregoing, none of the
representations and warranties in this paragraph 2(a) shall apply to
statements in, or omissions from, the Registration Statement or the
Prospectus made in reliance upon, and in conformity with, information
herein or otherwise furnished in writing by the Underwriters for use in
the Registration Statement or the Prospectus. With respect to the
preceding sentence, the Company acknowledges that the only information
furnished in writing by the Underwriters for use in the Registration
Statement or the Prospectus is the statements contained in the second,
fourth and sixth paragraphs under the caption "Underwriting" in the
Prospectus Supplement.
(b) The Registration Statement is effective under the
Securities Act and no stop order preventing or suspending the
effectiveness of the Registration Statement or suspending or preventing
the use of the Prospectus has been issued by the Commission and no
proceedings for that purpose have been instituted or are threatened
under the Securities Act. Any required filing of the Prospectus and any
supplement thereto pursuant to Rule 424(b) of the Rules has been or
will be made in the manner and within the time period required by such
Rule 424(b).
(c) The documents incorporated by reference in the
Registration Statement and the Prospectus, at the time they became
effective or were filed with the Commission, as the case may be,
complied in all material respects with the requirements of the
Securities Act or the Exchange Act, as applicable, and the rules and
regulations of the Commission thereunder, and none of such documents
contained an untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary in order to
make the statements therein, in the light of the circumstances under
which they were made, not misleading, and any further documents so
filed and incorporated by reference in the Registration Statement and
the Prospectus, when such documents become effective or are filed with
the Commission, as the case may be, will conform in all material
respects to the requirements of the Securities Act or the Exchange Act,
as applicable, and the rules and regulations of the Commission
thereunder and will not contain an untrue statement of a material fact
or omit to state a material fact required to be stated therein or
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necessary to make the statements therein, in the light of the
circumstances under which they are made, not misleading.
(d) The consolidated financial statements of the Company
(including all notes and schedules thereto) included or incorporated by
reference in the Registration Statement and Prospectus present fairly
the financial position of the Company and its consolidated subsidiaries
at the dates indicated and the statement of operations, stockholders'
equity and cash flows of the Company and its consolidated subsidiaries
for the periods specified; and such consolidated financial statements
and related schedules and notes thereto, and the unaudited financial
information filed with the Commission as part of the Registration
Statement, have been prepared in conformity with generally accepted
accounting principles, consistently applied throughout the periods
involved. The summary and selected financial data included in the
Prospectus present fairly the information shown therein as at the
respective dates and for the respective periods specified and have been
presented on a basis consistent with the consolidated financial
statements set forth in the Prospectus and other financial information.
The financial information included in or incorporated in the
Registration Statement and the Prospectus complies with the
requirements of Regulation G and Item 10 of Regulation S-K of the
Commission.
(e) KPMG LLP, whose reports are filed with the Commission as a
part of the Registration Statement, are and, during the periods covered
by their reports, were independent public accountants as required by
the Securities Act and the Rules.
(f) The Company and each of its significant subsidiaries (as
such term is defined in Rule 1-02 of Regulation S-X) is duly organized,
validly existing and in good standing under the laws of their
respective jurisdictions of incorporation or organization. The Company
and each such subsidiary is duly qualified to do business and is in
good standing as a foreign corporation in each jurisdiction in which
the nature of the business conducted by it or location of the assets or
properties owned, leased or licensed by it requires such qualification,
except for such jurisdictions where the failure to so qualify
individually or in the aggregate would not have a material adverse
effect on the assets, properties, condition, financial or otherwise, or
in the results of operations, business affairs or business prospects of
the Company and its subsidiaries considered as a whole (a "Material
Adverse Effect"); and to the Company's knowledge, no proceeding has
been instituted in any such jurisdiction revoking, limiting or
curtailing, or seeking to revoke, limit or curtail, such power and
authority or qualification.
(g) The Company and each of its subsidiaries has all requisite
corporate power and authority, and all necessary authorizations,
approvals, consents, orders, licenses, certificates and permits of and
from all governmental or regulatory bodies or any other person or
entity (collectively, the "Permits"), to own, lease and license its
assets and properties and conduct its business, all of which are valid
and in full force and effect, except where the lack of such Permits,
individually or in the aggregate, would not have a Material Adverse
Effect. The Company and each of its subsidiaries has fulfilled and
performed in all material respects all of its material obligations with
respect to such Permits and no event has occurred that allows, or after
notice or lapse of time would
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allow, revocation or termination thereof or results in any other
material impairment of the rights of the Company thereunder. Except as
may be required under the Securities Act and state and foreign Blue Sky
laws, no other Permits are required to enter into, deliver and perform
this Agreement and to issue and sell the Shares.
(h) The Company and each of its subsidiaries owns or possesses
legally enforceable rights to use all trademarks, trademark
applications, trade names, service marks, copyrights, copyright
applications, licenses, know-how and other similar rights and
proprietary knowledge (collectively, "Intangibles") necessary for the
conduct of its business. Neither the Company nor any of its
subsidiaries has received any notice of, or is not aware of, any
infringement of or conflict with asserted rights of others with respect
to any Intangibles.
(i) The Company and each of its subsidiaries has good and
marketable title in fee simple to all real property, and good and
marketable title to all other property owned by it, in each case free
and clear of all liens, encumbrances, claims, security interests and
defects, except (A) as disclosed in the Company's filings with the
Commission under the Exchange Act and (B) such as do not materially
affect the value of such property and do not materially interfere with
the use made or proposed to be made of such property by the Company and
its subsidiaries. All property held under lease by the Company and its
subsidiaries is held by them under valid, existing and enforceable
leases, free and clear of all liens, encumbrances, claims, security
interests and defects, except such as are not material and do not
materially interfere with the use made or proposed to be made of such
property by the Company and its subsidiaries.
(j) There are no litigation or governmental proceedings to
which the Company or any of its subsidiaries is subject or that is
pending or, to the knowledge of the Company, threatened, against the
Company or any of its subsidiaries that, individually or in the
aggregate, might have a Material Adverse Effect, affect the
consummation of this Agreement or that is required to be disclosed in
the Registration Statement and the Prospectus that is not so disclosed.
(k) Subsequent to the respective dates as of which information
is given in the Registration Statement and the Prospectus, except as
described therein, (i) there has not been any change in the assets or
properties, business, results of operations, prospects or condition
(financial or otherwise), of the Company and its subsidiaries taken as
a whole, whether or not arising from transactions in the ordinary
course of business which would have a Material Adverse Effect; (ii)
neither the Company nor any of its subsidiaries has sustained any loss
or interference with its assets, businesses or properties (whether
owned or leased) from fire, explosion, earthquake, flood or other
calamity, whether or not covered by insurance, or from any labor
dispute or any court or legislative or other governmental action, order
or decree which would have a Material Adverse Effect; and (iii) since
the date of the latest balance sheet included or incorporated by
reference in the Registration Statement and the Prospectus, neither the
Company nor its subsidiaries has (A) issued any securities or incurred
any liability or obligation, direct or contingent, for borrowed money,
except for such liabilities or obligations incurred in the ordinary
course of business (B) entered into any transaction not in the ordinary
course of business or (C)
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except for regular dividends on the Common Stock in amounts per share
that are consistent with past practice, declared or paid any dividend
or made any distribution on any shares of its stock or redeemed,
purchased or otherwise acquired or agreed to redeem, purchase or
otherwise acquire any shares of its capital stock.
(l) There is no document, contract or other agreement required
to be described in the Registration Statement or Prospectus or to be
filed as an exhibit to the Registration Statement which is not
described or filed as required by the Securities Act or Rules. Each
description of a contract, document or other agreement in the
Registration Statement and the Prospectus accurately reflects in all
material respects the terms of the underlying contract, document or
other agreement. Each contract, document or other agreement described
in the Registration Statement and Prospectus or listed in the Exhibits
to the Registration Statement or incorporated by reference is in full
force and effect and is valid and enforceable by and against the
Company or its subsidiary, as the case may be, in accordance with its
terms. Neither the Company nor any of its subsidiaries, if a subsidiary
is a party, nor to the Company's knowledge, any other party is in
default in the observance or performance of any term or obligation to
be performed by it under any such agreement, and no event has occurred
which with notice or lapse of time or both would constitute such a
default, in any such case which default or event, individually or in
the aggregate, would have a Material Adverse Effect. No default exists,
and no event has occurred which with notice or lapse of time or both
would constitute a default, in the due performance and observance of
any term, covenant or condition, by the Company or its subsidiary, if a
subsidiary is a party thereto, of any other agreement or instrument to
which the Company or any of its subsidiaries is a party or by which
Company or its properties or business or a subsidiary or its properties
or business may be bound or affected which default or event,
individually or in the aggregate, would have a Material Adverse Effect.
(m) Neither the Company nor any of its subsidiaries is in
violation of any term or provision of its charter or by-laws or of any
franchise, license, permit, judgment, decree, order, statute, rule or
regulation, where the consequences of such violation, individually or
in the aggregate, would have a Material Adverse Effect.
(n) This Agreement has been duly authorized, executed and
delivered by the Company.
(o) Neither the execution, delivery and performance of this
Agreement by the Company nor the consummation of any of the
transactions contemplated hereby (including, without limitation, the
issuance and sale by the Company of the Shares) will give rise to a
right to terminate or accelerate the due date of any payment due under,
or conflict with or result in the breach of any term or provision of,
or constitute a default (or an event which with notice or lapse of time
or both would constitute a default) under, or require any consent or
waiver under, or result in the execution or imposition of any lien,
charge or encumbrance upon any properties or assets of the Company or
its subsidiaries pursuant to the terms of, any indenture, mortgage,
deed of trust or other agreement or instrument to which the Company or
any of its subsidiaries is a party or by which either the Company or
its subsidiaries or any of their properties or businesses is bound, or
any
7
franchise, license, permit, judgment, decree, order, statute, rule or
regulation applicable to the Company or any of its subsidiaries or
violate any provision of the charter or by-laws of the Company or any
of its subsidiaries, except for such consents or waivers which have
already been obtained and are in full force and effect.
(p) The Company has authorized and outstanding capital stock
as set forth under the caption "Capitalization" in the Prospectus. The
certificates evidencing the Shares are in due and proper legal form and
have been duly authorized for issuance by the Company. All of the
issued and outstanding shares of Common Stock have been duly and
validly issued and are fully paid and nonassessable. There are no
statutory preemptive or other similar rights to subscribe for or to
purchase or acquire any shares of Common Stock of the Company or any of
its subsidiaries or any such rights pursuant to its certificate of
incorporation or by-laws or any agreement or instrument to or by which
the Company or any of its subsidiaries is a party or bound. The Shares,
when issued and sold pursuant to this Agreement, will be duly and
validly issued, fully paid and nonassessable and none of them will be
issued in violation of any preemptive or other similar right. Except as
disclosed in the Registration Statement and the Prospectus, there is no
outstanding option, warrant or other right calling for the issuance of,
and there is no commitment, plan or arrangement to issue, any share of
stock of the Company or any of its subsidiaries or any security
convertible into, or exercisable or exchangeable for, such stock. The
Common Stock and the Shares conform in all material respects to all
statements in relation thereto contained in the Registration Statement
and the Prospectus. All outstanding shares of capital stock of each of
the Company's significant subsidiaries have been duly authorized and
validly issued, and are fully paid and nonassessable and are owned
directly by the Company or by another wholly owned subsidiary of the
Company free and clear of any security interests, liens, encumbrances,
equities or claims, other than those described in the Prospectus.
(q) No holder of any security of the Company has any right,
which has not been waived, to have any security owned by such holder
included in the Registration Statement or to demand registration of any
security owned by such holder for a period of 90 days after the date of
this Agreement. Each person listed on Schedule II hereto has delivered
to the Underwriters his enforceable written lock-up agreement in the
form attached to this Agreement as Exhibit A hereto ("Lock-Up
Agreement").
(r) All necessary corporate action has been duly and validly
taken by the Company to authorize the execution, delivery and
performance of this Agreement and the issuance and sale of the Shares
by the Company. This Agreement has been duly and validly authorized,
executed and delivered by the Company and constitutes, and will
constitute legal, valid and binding obligations of the Company
enforceable against the Company in accordance with its terms, except as
the enforceability thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the
enforcement of creditors' rights generally and by general equitable
principles.
(s) Neither the Company nor any of its subsidiaries is
involved in any labor dispute nor, to the knowledge of the Company, is
any such dispute threatened, which
8
dispute would have a Material Adverse Effect. The Company is not aware
of any existing or imminent labor disturbance by the employees of any
of its principal suppliers or contractors which would have a Material
Adverse Effect. The Company is not aware of any threatened or pending
litigation between the Company or its subsidiaries and any of its
executive officers which, if adversely determined, could have a
Material Adverse Effect and has no reason to believe that such officers
will not remain in the employment of the Company.
(t) No transaction has occurred between or among the Company
and any of its officers or directors, shareholders or any affiliate or
affiliates of any such officer or director or shareholder that is
required to be described in and is not described in the Registration
Statement and the Prospectus.
(u) The Company has not taken, nor will it take, directly or
indirectly, any action designed to or which might reasonably be
expected to cause or result in, or which has constituted or which might
reasonably be expected to constitute, the stabilization or manipulation
of the price of the Common Stock or any security of the Company to
facilitate the sale or resale of any of the Shares.
(v) The Company and each of its significant subsidiaries has
filed all Federal, state, local and foreign tax returns which are
required to be filed through the date hereof, which returns are true
and correct in all material respects or has received timely extensions
thereof, and has paid all taxes shown on such returns and all
assessments received by it to the extent that the same are material and
have become due. There are no tax audits or investigations pending,
which if adversely determined would have a Material Adverse Effect; nor
are there any material proposed additional tax assessments against the
Company or any of its significant subsidiaries.
(w) The Shares have been duly authorized for listing on the
New York Stock Exchange, subject to official Notice of Issuance.
(x) The Company has taken no action designed to, or likely to
have the effect of, terminating the registration of the Common Stock
under the Exchange Act or listing on the New York Stock Exchange, nor
has the Company received any notification that the Commission or the
New York Stock Exchange is contemplating terminating such registration
or quotation.
(y) The books, records and accounts of the Company and its
subsidiaries accurately, fairly and reasonably reflect the transactions
in, and dispositions of, the assets of, and the results of operations
of, the Company and its subsidiaries. The Company and each of its
subsidiaries maintains a system of internal accounting controls
sufficient to provide reasonable assurances that (i) transactions are
executed in accordance with management's general or specific
authorizations, (ii) transactions are recorded as necessary to permit
preparation of consolidated financial statements in accordance with
generally accepted accounting principles and to maintain asset
accountability, (iii) access to assets is permitted only in accordance
with management's general or specific authorization and (iv) the
recorded accountability for assets is compared with the existing
9
assets at reasonable intervals and appropriate action is taken with
respect to any differences.
(z) The Company and its subsidiaries are insured by insurers
of recognized financial responsibility against such losses and risks
and in such amounts as are customary in the businesses in which they
are engaged or propose to engage after giving effect to the
transactions described in the Prospectus, and such policies are in full
force and effect.
(aa) Each approval, consent, order, authorization,
designation, declaration or filing of, by or with any regulatory,
administrative or other governmental body necessary in connection with
the execution and delivery by the Company of this Agreement and the
consummation of the transactions herein contemplated required to be
obtained or performed by the Company (except such additional steps as
may be required by the National Association of Securities Dealers, Inc.
(the "NASD") or may be necessary to qualify the Shares for public
offering by the Underwriters under the state securities or Blue Sky
laws) has been obtained or made and is in full force and effect.
(bb) Based solely on a review of the director and officer
questionnaires prepared in connection with this transaction, there are
no affiliations with the NASD among the Company's officers, directors
or, to the best of the knowledge of the Company, any five percent or
greater stockholder of the Company, except as set forth in the
Registration Statement or otherwise disclosed in writing to the
Underwriters.
(cc) (A) Except as disclosed in the Company's filings with
the Commission under the Exchange Act and (B) as would not,
individually or in the aggregate, result in a material adverse effect,
(i) each of the Company and each of its subsidiaries is in compliance
in all material respects with all rules, laws and regulation relating
to the use, treatment, storage and disposal of toxic substances and
protection of health or the environment ("Environmental Law") which are
applicable to its business; (ii) neither the Company nor its
subsidiaries has received any notice from any governmental authority or
third party of an asserted claim under Environmental Laws; (iii) each
of the Company and each of its subsidiaries has received all permits,
licenses or other approvals required of it under applicable
Environmental Laws to conduct its business and is in compliance with
all terms and conditions of any such permit, license or approval; (iv)
to the Company's knowledge, no facts currently exist that will require
the Company or any of its subsidiaries to make future material capital
expenditures to comply with Environmental Laws; and (v) no property
which is or has been owned, leased or occupied by the Company or its
subsidiaries has been designated as a Superfund site pursuant to the
Comprehensive Environmental Response, Compensation of Liability Act of
1980, as amended (42 U.S.C. Section 9601, et. seq.) ("CER, CLA 1980")
or otherwise designated as a contaminated site under applicable state
or local law. Neither the Company nor any of its subsidiaries has been
named as a "potentially responsible party" under the CER, CLA 1980.
(dd) In the ordinary course of its business, the Company
periodically reviews the effect of Environmental Laws on the business,
operations and properties of the
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Company and its subsidiaries, in the course of which the Company
identifies and evaluates associated costs and liabilities (including,
without limitation, any capital or operating expenditures required for
clean-up, closure of properties or compliance with Environmental Laws,
or any permit, license or approval, any related constraints on
operating activities and any potential liabilities to third parties).
(ee) The Company is not and, after giving effect to the
offering and sale of the Shares and the application of proceeds thereof
as described in the Prospectus, will not be an "investment company"
within the meaning of the Investment Company Act of 1940, as amended
(the "Investment Company Act").
(ff) The Company or any other person affiliated with or
acting on behalf of the Company including, without limitation, any
officer, director, employee, or agent of the Company or any stockholder
thereof acting on behalf of the Company or its subsidiaries, has not,
directly or indirectly, while acting on behalf of the Company or its
subsidiaries (i) used any corporate funds for unlawful contributions,
gifts, entertainment or other unlawful expenses relating to political
activity; (ii) made any unlawful payment to foreign or domestic
government officials or employees or to foreign or domestic political
parties or campaigns from corporate funds; (iii) violated any provision
of the Foreign Corrupt Practices Act of 1977, as amended; or (iv) made
any other unlawful payment.
(gg) Except as described in the Prospectus or in the
documents incorporated by reference into the Prospectus, the Company
has not sold or issued any shares of Common Stock during the six-month
period preceding the date of the Prospectus, including any sales
pursuant to Rule 144A under, or Regulations D or S of, the Securities
Act, other than shares issued pursuant to employee benefit plans,
qualified stock options plans or other employee compensation plans or
pursuant to outstanding options, rights or warrants.
(hh) The Company has fulfilled its obligations, if any,
under the minimum funding standards of Section 302 of the U.S. Employee
Retirement Income Security Act of 1974 ("ERISA") and the regulations
and published interpretations thereunder with respect to each "plan" as
defined in Section 3(3) of ERISA and such regulations and published
interpretations in which its employees are eligible to participate and
each such plan is in compliance in all material respects with the
presently applicable provisions of ERISA and such regulations and
published interpretations. No "Reportable Event" (as defined in 12
ERISA) has occurred with respect to any "Pension Plan" (as defined in
ERISA) for which the Company could have any liability.
(ii) Each of the Company, its directors and officers has not
distributed and will not distribute prior to the later of (i) the Firm
Shares Closing Date, or the Option Shares Closing Date, and (ii)
completion of the distribution of the Shares, any offering material in
connection with the offering and sale of the Shares other than any
Preliminary Prospectus, the Prospectus, the Registration Statement and
other materials, if any, permitted by the Securities Act.
11
(jj) There is and has been no failure on the part of the
Company to comply in all material respects with any provisions of the
Xxxxxxxx-Xxxxx Act of 2002 and the rules and regulations promulgated in
connection therewith that are effective, including Sections 302 and 906
related to certifications, except for any provisions with which the
Company is not currently required to comply.
3. Conditions of the Underwriters' Obligations. The
obligations of the Underwriters to purchase the Shares are subject to each of
the following terms and conditions:
(a) Notification that all filings related to the Registration
Statement, the Prospectus, and the offering of the Shares required by
Rule 424 of the Rules shall have been made.
(b) No order preventing or suspending the use of any
Prospectus shall have been or shall be in effect and no 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 any requests for additional
information on the part of the Commission (to be included in the
Registration Statement or the Prospectus or otherwise) shall have been
complied with to the satisfaction of the Commission and the
Underwriters. If the Company has elected to rely upon Rule 430A, Rule
430A information previously omitted from the effective Registration
Statement pursuant to Rule 430A shall have been transmitted to the
Commission for filing pursuant to Rule 424(b) within the prescribed
time period and the Company shall have provided evidence satisfactory
to the Underwriters of such timely filing, or a post-effective
amendment providing such information shall have been promptly filed and
declared effective in accordance with the requirements of Rule 430A.
(c) The representations and warranties of the Company
contained in this Agreement and in the certificates delivered pursuant
to Section 3(d) shall be true and correct when made and on and as of
each Closing Date as if made on such date. The Company shall have
performed all covenants and agreements and satisfied all the conditions
contained in this Agreement required to be performed or satisfied by
them at or before such Closing Date.
(d) The Underwriters shall have received on each Closing Date
a certificate, addressed to the Underwriters and dated such Closing
Date, of the chief executive or chief operating officer and the chief
financial officer or chief accounting officer of the Company to the
effect that: (i) the representations, warranties and agreements of the
Company in this Agreement were true and correct when made and are true
and correct as of such Closing Date; (ii) the Company has performed all
covenants and agreements and satisfied all conditions contained herein;
(iii) they have carefully examined the Registration Statement and the
Prospectus and, in their opinion (A) as of the Effective Date, the
Registration Statement and Prospectus did not include any untrue
statement of a material fact and did not omit to state a material fact
required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made,
not misleading, and (B) since the Effective Date no event has occurred
which should have been set forth in a supplement or otherwise required
an amendment to
12
the Registration Statement or the Prospectus; and (iv) no stop order
suspending the effectiveness of the Registration Statement has been
issued and, to their knowledge, no proceedings for that purpose have
been instituted or are pending under the Securities Act.
(e) The Underwriters shall have received, at the time this
Agreement is executed and on each Closing Date a signed letter from
KPMG LLP addressed to the Underwriters and dated, respectively, the
date of this Agreement and each such Closing Date, in form and
substance reasonably satisfactory to the Underwriters containing
statements and information of the type ordinarily included in
accountants' "comfort letters" to underwriters with respect to the
consolidated financial statements and certain financial information
contained in the Registration Statement and the Prospectus.
(f) The Underwriters shall have received on each Closing Date
from Xxxxxx, Xxxx & Xxxxxxxx, LLP, counsel for the Company, an opinion,
addressed to the Underwriters and dated such Closing Date, and stating
in effect that:
(i) Neither the execution, delivery and
performance of this Agreement by the Company nor the
consummation of any of the transactions contemplated hereby
(including, without limitation, the issuance and sale by the
Company of the Shares) will violate or conflict with, or
result in any contravention of the laws, rules and regulations
of the State of New York and the federal laws of the United
States of America that are, in our experience, generally
applicable to transactions of the nature contemplated hereby.
(ii) No consent, approval, authorization,
license, registration, qualification or order of any court or
governmental agency or regulatory body is required for the due
authorization, execution, delivery or performance of this
Agreement by the Company or the consummation of the
transactions contemplated hereby, except such as have been
obtained under the Securities Act and such as may be required
under state securities or Blue Sky laws in connection with the
purchase and distribution of the Shares by the Underwriters.
(iii) To the best of such counsel's knowledge,
there is no action, suit, proceeding or other investigation,
before any court or before or by any public body or board
pending or threatened against, or involving the assets,
properties or businesses of, the Company which is required to
be disclosed in the Registration Statement and the Prospectus
and is not so disclosed or which could reasonably be expected
to have a Material Adverse Effect.
(iv) The Registration Statement, all Preliminary
Prospectuses and the Prospectus and each amendment or
supplement thereto (except for the consolidated financial
statements and schedules and other financial data included
therein, as to which such counsel expresses no opinion) comply
as to form in all material respects with the requirements of
the Securities Act and the Rules and the documents
incorporated by reference in the Registration Statement, all
Preliminary Prospectuses and the Prospectuses and the
documents incorporated therein, and any further amendment or
supplement to any such incorporated
13
document made by the Company (except for the consolidated
financial statements and schedules and other financial data
included therein, as to which such counsel expresses no
opinion) when they became effective or were filed with the
Commission, as the case may be, complied as to form in all
material respects with the requirements of the Securities Act
or the Exchange Act, as applicable, and the rules and
regulations of the Commission thereunder.
(v) The Registration Statement is effective
under the Securities Act, and to such counsel's knowledge no
stop order suspending the effectiveness of the Registration
Statement has been issued and no proceedings for that purpose
have been instituted or are threatened, pending or
contemplated. Any required filing of the Prospectus and any
supplement thereto pursuant to Rule 424(b) under the
Securities Act has been made in the manner and within the time
period required by such Rule 424(b).
(vi) The Shares have been approved for listing on
the New York Stock Exchange.
(vii) The Company is not 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.
(viii) The statements in the Prospectus under the
captions "Description of 9% Notes," "Description of Debt
Securities," "Description of Warrants" and "Certain United
States Federal Tax Considerations," insofar as such statements
constitute a summary of documents referred to therein or
matters of law, are accurate in all material respects and
accurately present the information with respect to such
documents and matters.
(ix) The form of certificate used to evidence the
Common Stock complies in all material respects with the
requirements of the New York Stock Exchange.
To the extent deemed advisable by such counsel, such counsel
may rely as to matters of fact on certificates of responsible officers
of the Company and public officials and on the opinions of other
counsel satisfactory to the Underwriters as to matters which are
governed by laws other than the laws of the State of New York, the
General Corporation Law of the State of Delaware and the Federal laws
of the United States; provided that such counsel shall state that in
its opinion the Underwriters and it are justified in relying on such
other opinions. Copies of such certificates and other opinions shall be
furnished to the Underwriters and counsel for the Underwriters.
In addition, such counsel shall state that such counsel has
participated in conferences with officers and other representatives of
the Company, representatives of the Underwriters and representatives of
the independent certified public accountants of the Company, at which
conferences the contents of the Registration Statement and the
Prospectus and related matters were discussed and, although such
counsel is not passing
14
upon and does not assume any responsibility for the accuracy,
completeness or fairness of the statements contained in the
Registration Statement and the Prospectus (except as specified in the
foregoing opinion), on the basis of the foregoing, no facts have come
to the attention of such counsel which lead such counsel to believe
that (i) the Registration Statement at the time it became effective
(except with respect to the consolidated financial statements and notes
and schedules thereto and other financial data, as to which such
counsel need express no belief) 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 the Prospectus as amended or supplemented (except with respect to
the consolidated financial statements, notes and schedules thereto and
other financial data, as to which such counsel need make no statement)
on the date thereof contained any 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
were made, not misleading or (ii) any document incorporated by
reference in the Prospectus or any further amendment or supplement to
any such incorporated document made by the Company, when it became
effective or was filed with the Commission, as the case may be,
contained, in the case of a registration statement which became
effective under the Securities Act, any untrue statement of a material
fact or omitted to state a material fact required to be stated therein
or necessary in order to make the statements therein not misleading,
or, in the case of other documents which were filed under the Exchange
Act with the Commission, 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
were made, not misleading.
(g) The Underwriters shall have received on each Closing Date
from Xxxxxxx X. Xxxx, Esq., Secretary and General Counsel of the
Company (except, with respect to (i) and (ii) of this paragraph (g), as
otherwise covered by foreign counsel as contemplated by paragraph (h)
below), an opinion, addressed to the Underwriters and dated each such
Closing Date, and stating in effect that:
(i) Each of the Company and its Subsidiaries has
been duly organized and is validly existing as a corporation
in good standing under the laws of the jurisdiction of its
incorporation. The Company and its Subsidiaries is duly
qualified to transact business and is in good standing as a
foreign corporation in the jurisdictions set forth on Schedule
[ ], except where the failure to so qualify or to be in good
standing, individually or in the aggregate, would not have a
Material Adverse Effect.
(ii) Each of the Company and its Subsidiaries has
all requisite corporate power and authority to own, lease and
operate its properties and to conduct its business as now
being conducted and as described in the Registration Statement
and the Prospectus and, with respect to the Company, to enter
into and perform its obligations under this Agreement and to
issue and sell the Shares.
(iii) The authorized, issued and outstanding
capital stock of the Company is as set forth in the
Registration Statement and the Prospectus under the caption
"Capitalization" as of the dates stated therein and, since
such dates,
15
there has been no change in the capital stock of the Company
except for subsequent issuances, if any, pursuant to this
Agreement or pursuant to transactions, reservations,
agreements or employee benefit plans referred to in the
Prospectus or pursuant to the exercise of convertible
securities or options referred to in the Prospectus. The
Shares to be issued and sold by the Company pursuant to this
Agreement have been duly authorized for issuance and sale to
the Underwriters pursuant to this Agreement and, when issued
and delivered by the Company pursuant to this Agreement
against payment of the consideration set forth herein, will be
validly issued, fully paid and nonassessable, and no holder of
the Shares is or will be subject to personal liability by
reason of being such a holder. The issuance and sale of the
Shares by the Company is not subject to any preemptive or
other similar rights of any securityholder of the Company. To
the best of such counsel's knowledge, except as disclosed in
the Registration Statement and the Prospectus, there are no
preemptive or other rights to subscribe for or to purchase or
any restriction upon the voting or transfer of any securities
of the Company pursuant to the Company's certificate of
incorporation or by-laws or other governing documents or any
agreements or other instruments to which the Company is a
party or by which it is bound. To the best of such counsel's
knowledge, except as disclosed in the Registration Statement
and the Prospectus, there is no outstanding option, warrant or
other right calling for the issuance of, and no commitment,
plan or arrangement to issue, any share of stock of the
Company or any security convertible into, exercisable for, or
exchangeable for stock of the Company. The Common Stock and
the Shares conform in all material respects to the
descriptions thereof contained in the Registration Statement
and the Prospectus. The form of certificate used to evidence
the Common Stock complies in all material respects with all
applicable statutory requirements, with any applicable
requirements of the certificate of incorporation or by-laws of
the Company. To the best of such counsel's knowledge, there
are no persons with registration rights or other similar
rights to have any securities registered pursuant to the
Registration Statement or otherwise registered by the Company
under the Securities Act.
(iv) All necessary corporate action has been duly
and validly taken by the Company to authorize the execution,
delivery and performance of this Agreement and the issuance
and sale of the Shares.
(v) This Agreement has been duly and validly
authorized, executed and delivered by the Company.
(vi) Neither the execution, delivery and
performance of this Agreement by the Company nor the
consummation of any of the transactions contemplated hereby
(including, without limitation, the issuance and sale by the
Company of the Shares) will give rise to a right to terminate
or accelerate the due date of any payment due under, or
conflict with or result in the breach of any term or provision
of, or constitute a default (or any event which with notice or
lapse of time, or both, would constitute a default) under, or
require consent or waiver under, or result in the execution or
imposition of any lien, charge, claim, security
16
interest or encumbrance upon any properties or assets of the
Company or any Subsidiary pursuant to the terms of, any
indenture, mortgage, deed, trust, note or other agreement or
instrument filed as an exhibit to the Company's filings with
the Commission under the Exchange Act.
(vii) No consent, approval, authorization,
license, registration, qualification or order of any court or
governmental agency or regulatory body pursuant to the laws of
the State of Idaho is required for the due authorization,
execution, delivery or performance of this Agreement by the
Company or the consummation of the transactions contemplated
hereby, except such as have been obtained under the Securities
Act and such as may be required under state securities or Blue
Sky laws in connection with the purchase and distribution of
the Shares by the Underwriters.
(viii) To the best of counsel's knowledge (A) each
of the Company and each of its subsidiaries is in compliance
in all material respects with all applicable Environmental
Laws; (B) neither the Company nor its subsidiaries has
received any notice from any governmental authority or third
party of an asserted claim under any Environmental Laws,
except as would not, singly or in the aggregate, have a
Material Adverse Effect; (C) each of the Company and each of
its subsidiaries has received all permits, licenses or other
approvals required of it under applicable Environmental Laws
to conduct its business and is in compliance with all terms
and conditions of any such permit, license or approval, except
where such failure to receive required permits, licenses or
other approvals would not, singly or in the aggregate, have a
Material Adverse Effect; and (D) any claims made pursuant to
the Comprehensive Environmental Response, Compensation of
Liability Act of 1980, as amended, or comparable applicable
federal, state or local law with respect to property that is
or has been owned, leased or occupied by the Company or its
subsidiaries, have been settled or disclosed in the
Prospectus, except any claims which would not, singly or in
the aggregate, have a Material Adverse Effect.
(ix) The statements in the Prospectus under the
captions "Description of Common Stock" and "Description of
Capital Stock" and in the Registration Statement under Item 14
of Part II, insofar as such statements constitute a summary of
documents referred to therein or matters of law, are accurate
in all material respects and accurately present the
information with respect to such documents and matters.
Accurate copies of all contracts and other documents required
to be filed as exhibits to, or described in, the Registration
Statement have been so filed with the Commission or are fairly
described in the Registration Statement, as the case may be.
(x) Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP,
and Xxxxxx, Xxxx & Xxxxxxxx, LLP are entitled to rely upon
this opinion in connection with the opinions given by such
firms pursuant to the Underwriting Agreement.
17
(h) The Underwriters shall have received on each Closing Date
from foreign counsel of the Company, opinions reasonably satisfactory
in form and substance to the Underwriters and its counsel.
(i) The Underwriters shall have received on each Closing Date
from Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP, counsel for the
Underwriters, an opinion, addressed to the Underwriters and dated such
Closing Date, in form and substance satisfactory to the Underwriters.
(j) All proceedings taken in connection with the sale of the
Firm Shares and the Option Shares as herein contemplated shall be
reasonably satisfactory in form and substance to the Underwriters and
their counsel and the Underwriters shall have received from Skadden,
Arps, Slate, Xxxxxxx & Xxxx LLP a favorable opinion, addressed to the
Underwriters and dated such Closing Date, with respect to the Shares,
the Registration Statement and the Prospectus, and such other related
matters, as the Underwriters may reasonably request, and the Company
shall have furnished to Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP such
documents as they may reasonably request for the purpose of enabling
them to pass upon such matters.
(k) The Underwriters shall have received copies of the Lock-up
Agreements executed by each entity or person listed on Schedule II
hereto.
(l) The Shares shall have been approved for listing on the New
York Stock Exchange, subject only to official notice of issuance.
(m) The Company shall have furnished or caused to be furnished
to the Underwriters such further certificates or documents as the
Underwriters shall have reasonably requested.
4. Covenants of the Company.
(a) The Company covenants and agrees as follows:
(i) The Company will use its best efforts to
cause the Registration Statement, if not effective at the time
of execution of this Agreement, and any amendments thereto, to
become effective as promptly as possible. The Company shall
prepare the Prospectus in a form approved by the Underwriters
and file such Prospectus pursuant to Rule 424(b) under the
Securities Act not later than the Commission's close of
business on the second business day following the execution
and delivery of this Agreement, or, if applicable, such
earlier time as may be required by the Rules.
(ii) The Company shall promptly advise the
Underwriters in writing (A) when any post-effective amendment
to the Registration Statement shall have become effective or
any supplement to the Prospectus shall have been filed, (B) of
any request by the Commission for any amendment of the
Registration Statement or the Prospectus or for any additional
information, (C) of the issuance by the Commission of any stop
order suspending the effectiveness of
18
the Registration Statement or of any order preventing or
suspending the use of any preliminary prospectus or the
institution or threatening of any proceeding for that purpose
and (D) of the receipt by the Company of any notification with
respect to the suspension of the qualification of the Shares
for sale in any jurisdiction or the initiation or threatening
of any proceeding for such purpose. The Company shall not file
any amendment of the Registration Statement or supplement to
the Prospectus or any document incorporated by reference in
the Registration Statement unless the Company has furnished
the Underwriters a copy for their review prior to filing and
shall not file any such proposed amendment or supplement to
which the Underwriters reasonably object. The Company shall
use its best efforts to prevent the issuance of any such stop
order and, if issued, to obtain as soon as possible the
withdrawal thereof.
(iii) If, at any time when a prospectus relating
to the Shares is required to be delivered under the Securities
Act and the Rules, any event occurs as a result of which the
Prospectus as then amended or supplemented would include any
untrue statement of a material fact or omit to state any
material fact necessary to make the statements therein in the
light of the circumstances under which they were made not
misleading, or if it shall be necessary to amend or supplement
the Prospectus to comply with the Securities Act or the Rules,
the Company promptly shall prepare and file with the
Commission, subject to the second sentence of paragraph (ii)
of this Section 4(a), an amendment or supplement which shall
correct such statement or omission or an amendment which shall
effect such compliance.
(iv) The Company shall make generally available
to its security holders and to the Underwriters as soon as
practicable, but not later than 45 days after the end of the
12-month period beginning at the end of the fiscal quarter of
the Company during which the Effective Date occurs (or 90 days
if such 12-month period coincides with the Company's fiscal
year), an earning statement (which need not be audited) of the
Company, covering such 12-month period, which shall satisfy
the provisions of Section 11(a) of the Securities Act or Rule
158 of the Rules.
(v) The Company shall furnish to the
Underwriters and counsel for the Underwriters, without charge,
signed copies of the Registration Statement (including all
exhibits thereto and amendments thereof) and all amendments
thereof and, so long as delivery of a prospectus by an
underwriter or dealer may be required by the Securities Act or
the Rules, as many copies of any preliminary prospectus and
the Prospectus and any amendments thereof and supplements
thereto as the Underwriters may reasonably request. If
applicable, the copies of the Registration Statement and
Prospectus and each amendment and supplement thereto furnished
to the Underwriters 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.
19
(vi) The Company shall cooperate with the
Underwriters and their counsel in endeavoring to qualify the
Shares for offer and sale in connection with the offering
under the laws of such jurisdictions as the Underwriters may
designate and shall maintain such qualifications in effect so
long as required for the distribution of the Shares; provided,
however, that the Company shall not be required in connection
therewith, as a condition thereof, to qualify as a foreign
corporation or to execute a general consent to service of
process in any jurisdiction or subject itself to taxation as
doing business in any jurisdiction.
(vii) The Company, during the period when the
Prospectus is required to be delivered under the Securities
Act and the Rules or the Exchange Act, will file all reports
and other documents required to be filed with the Commission
pursuant to Section 13, 14 or 15 of the Exchange Act within
the time periods required by the Exchange Act and the
regulations promulgated thereunder.
(viii) Without the prior written consent of CIBC
World Markets Corp., for a period of 90 days after the date of
this Agreement, the Company and the individuals listed on
Schedule II hereto shall not issue, sell or register with the
Commission (other than on Form S-8 or on any successor form),
or otherwise dispose of, directly or indirectly, any equity
securities of the Company (or any securities convertible into,
exercisable for or exchangeable for equity securities of the
Company), except for (A) the issuance of the Shares pursuant
to the Registration Statement, (B) the issuance of shares
pursuant to the Company's existing stock option plan or bonus
plan as described in the Registration Statement and the
Prospectus, and (C) the issuance of shares of the Company's
Common Stock upon the exercise or conversion of securities of
the Company outstanding on the date hereof and disclosed in
the Registration Statement or Prospectus. In the event that
during this period, (A) any shares are issued pursuant to the
Company's existing stock option plan or bonus plan that are
exercisable during such 90-day period or (B) any registration
is effected on Form S-8 or on any successor form relating to
shares that are exercisable during such 90-period, the Company
shall use its best efforts to obtain the written agreement of
such grantee or purchaser or holder of such registered
securities that, for a period of 90 days after the date of
this Agreement, such person will not, without the prior
written consent of CIBC World Markets Corp., offer for sale,
sell, distribute, grant any option for the sale of, or
otherwise dispose of, directly or indirectly, or exercise any
registration rights with respect to, any shares of Common
Stock (or any securities convertible into, exercisable for, or
exchangeable for, any shares of Common Stock) owned by such
person.
(ix) On or before completion of this offering,
the Company shall make all filings required under applicable
securities laws and by the New York Stock Exchange (including
any required registration under the Exchange Act).
(x) Prior to the Closing Date, the Company will
issue no press release or other communications directly or
indirectly and hold no press
20
conference with respect to the Company, the condition,
financial or otherwise, or the earnings, business affairs or
business prospects of any of them, or the offering of the
Shares without the prior written consent of the Underwriters
unless in the judgment of the Company and its counsel, and
after notification to the Underwriters, such press release or
communication is required by law.
(xi) The Company will apply the net proceeds from
the offering of the Shares in the manner set forth under "Use
of Proceeds" in the Prospectus.
(b) The Company agrees to pay, or reimburse if paid by the
Underwriters, whether or not the transactions contemplated hereby are
consummated or this Agreement is terminated, all costs and expenses up
to $50,000 incident to the public offering of the Shares and the
performance of the obligations of the Company under this Agreement
including those relating to: (i) the preparation, printing, filing and
distribution of the Registration Statement including all exhibits
thereto, each preliminary prospectus, the Prospectus, all amendments
and supplements to the Registration Statement and the Prospectus and
any document incorporated by reference therein, and the printing,
filing and distribution of this Agreement; (ii) the preparation and
delivery of certificates for the Shares to the Underwriters; (iii) the
registration or qualification of the Shares for offer and sale under
the securities or Blue Sky laws of the various jurisdictions referred
to in Section 4(a)(vi), (iv) the furnishing (including costs of
shipping and mailing) to the Underwriters of copies of each preliminary
prospectus, the Prospectus and all amendments or supplements to the
Prospectus, and of the several documents required by this Section to be
so furnished, as may be reasonably requested for use in connection with
the offering and sale of the Shares by the Underwriters or by dealers
to whom Shares may be sold; (v) the filing fees of the NASD, if any, in
connection with its review of the terms of the public offering and
reasonable fees and disbursements of counsel for the Underwriters in
connection with such review; (vi) inclusion of the Shares for listing
on the New York Stock Exchange; and (vii) all transfer taxes, if any,
with respect to the sale and delivery of the Shares by the Company to
the Underwriters. Subject to the provisions of Section 7, the
Underwriters agree to pay, whether or not the transactions contemplated
hereby are consummated or this Agreement is terminated, all costs and
expenses incident to the performance of the obligations of the
Underwriters under this Agreement not payable by the Company pursuant
to the preceding sentence, including, without limitation, the fees and
disbursements of counsel for the Underwriters.
5. Indemnification.
(a) The Company agrees to indemnify and hold harmless the
Underwriters and each person, if any, who controls any Underwriter
within the meaning of Section 15 of the Securities Act or Section 20 of
the Exchange Act against any and all losses, claims, damages and
liabilities, joint or several (including any reasonable investigation,
legal and other expenses incurred in connection with, and any amount
paid in settlement of, any action, suit or proceeding or any claim
asserted), to which they, or any of them, may become subject under the
Securities Act, the Exchange Act or other Federal or state law or
regulation, at common law or otherwise, insofar as such losses, claims,
damages or liabilities arise out of or are based upon (i) any untrue
statement or alleged untrue
21
statement of a material fact contained in any preliminary prospectus,
the Registration Statement or the Prospectus or any amendment thereof
or supplement thereto, or in any Blue Sky application or other
information or other documents executed by the Company filed in any
state or other jurisdiction to qualify any or all of the Shares under
the securities laws thereof (any such application, document or
information being hereinafter referred to as a "Blue Sky Application")
or arise out of or are based upon any omission or alleged omission to
state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading (ii) in whole
or in part upon any breach of the representations and warranties set
forth in Section 4 hereof, or (iii) in whole or in part upon any
failure of the Company to perform any of its obligations hereunder or
under law; provided, however, that such indemnity shall not inure to
the benefit of any Underwriter (or any person controlling such
Underwriter) on account of any losses, claims, damages or liabilities
arising from the sale of the Shares to any person by such Underwriter
if such untrue statement or omission or alleged untrue statement or
omission was made in such preliminary prospectus, the Registration
Statement or the Prospectus, or such amendment or supplement thereto,
or in any Blue Sky Application in reliance upon and in conformity with
information furnished in writing to the Company by the Underwriters on
behalf of any Underwriter specifically for use therein. This indemnity
agreement will be in addition to any liability which the Company may
otherwise have.
(b) Each Underwriter agrees to indemnify and hold harmless the
Company, and each person, if any, who controls the Company within the
meaning of Section 15 of the Securities Act or Section 20 of the
Exchange Act, each director of the Company, and each officer of the
Company who signs the Registration Statement, against any losses,
claims, damages or liabilities to which such party may become subject,
under the Securities Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or
are based upon an untrue statement or alleged untrue statement of a
material fact contained in any preliminary prospectus, the Registration
Statement or the Prospectus, or any amendment or supplement thereto, or
arise out of or are based upon the omission or alleged omission to
state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, in each case
to the extent, but only to the extent, that such untrue statement or
alleged untrue statement or omission or alleged omission was made in
any preliminary prospectus, the Registration Statement or the
Prospectus or any such amendment or supplement in reliance upon and in
conformity with written information furnished to the Company by the
Underwriters expressly for use therein; provided, however, that the
obligation of each Underwriter to indemnify the Company (including any
controlling person, director or officer thereof) shall be limited to
the net proceeds received by the Company from such Underwriter.
(c) Any party that proposes to assert the right to be
indemnified under this Section will, promptly after receipt of notice
of commencement of any action, suit or proceeding against such party in
respect of which a claim is to be made against an indemnifying party or
parties under this Section, notify each such indemnifying party of the
commencement of such action, suit or proceeding, enclosing a copy of
all papers served. No indemnification provided for in Section 5(a) or
5(b) shall be available to any party who shall fail to give notice as
provided in this Section 5(c) if the party to whom
22
notice was not given was unaware of the proceeding to which such notice
would have related and was prejudiced by the failure to give such
notice but the omission so to notify such indemnifying party of any
such action, suit or proceeding shall not relieve it from any liability
that it may have to any indemnified party for contribution or otherwise
than under this Section. In case any such action, suit or proceeding
shall be brought against any indemnified party and it shall notify the
indemnifying party of the commencement thereof, the indemnifying party
shall be entitled to participate in, and, to the extent that it shall
wish, jointly with any other indemnifying party similarly notified, to
assume the defense thereof, with counsel reasonably satisfactory to
such indemnified party, and after notice from the indemnifying party to
such indemnified party of its election so to assume the defense thereof
and the approval by the indemnified party of such counsel, the
indemnifying party shall not be liable to such indemnified party for
any legal or other expenses, except as provided below and except for
the reasonable costs of investigation subsequently incurred by such
indemnified party in connection with the defense thereof. The
indemnified party shall have the right to employ its counsel in any
such action, but the fees and expenses of such counsel shall be at the
expense of such indemnified party unless (i) the employment of counsel
by such indemnified party has been authorized in writing by the
indemnifying parties, (ii) the indemnified party shall have been
advised by counsel that there may be one or more legal defenses
available to it which are different from or in addition to those
available to the indemnifying party (in which case the indemnifying
parties shall not have the right to direct the defense of such action
on behalf of the indemnified party) or (iii) the indemnifying parties
shall not have employed counsel to assume the defense of such action
within a reasonable time after notice of the commencement thereof, in
each of which cases the fees and expenses of counsel shall be at the
expense of the indemnifying parties. An indemnifying party shall not be
liable for any settlement of any action, suit, and proceeding or claim
effected without its written consent, which consent shall not be
unreasonably withheld or delayed.
6. Contribution. In order to provide for just and equitable
contribution in circumstances in which the indemnification provided for in
Section 5(a) or 5(b) is due in accordance with its terms but for any reason is
unavailable to or insufficient to hold harmless an indemnified party in respect
to any losses, liabilities, claims, damages or expenses referred to therein,
then each indemnifying party shall contribute to the aggregate losses,
liabilities, claims, damages and expenses (including any investigation, legal
and other expenses reasonably incurred in connection with, and any amount paid
in settlement of, any action, suit or proceeding or any claims asserted, but
after deducting any contribution received by any person entitled hereunder to
contribution from any person who may be liable for contribution) incurred by
such indemnified party, as incurred, in such proportion as is appropriate to
reflect the relative benefits received by the Company on the one hand and the
Underwriter (or Underwriters, if applicable) on the other hand from the offering
of the Shares pursuant to this Agreement or, if such allocation is not permitted
by applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to above but also the relative fault of the Company
on the one hand and the Underwriter(or Underwriters, if applicable) on the other
hand in connection with the statements or omissions which resulted in such
losses, liabilities, claims, damages or expenses, as well as any other relevant
equitable considerations. 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 (if applicable) were
treated as one entity for such
23
purpose) or by any other method of allocation which does not take
account of the equitable considerations referred to above. The
aggregate amount of losses, liabilities, claims, damages and expenses
incurred by an indemnified party and referred to above shall be deemed
to include nay legal or other expenses reasonably incurred by such
indemnified party in investigating, preparing or defending against any
litigation, or any investigation or proceeding by any governmental
agency or body, commenced or threatened, or any claim whatsoever based
upon any such untrue or alleged untrue statement or omission or alleged
omission. Notwithstanding the provisions of this Section 6, (i) no
Underwriter (except as may be provided in the Agreement Among
Underwriters) shall be required to contribute any amount in excess of
the amount by which the total price at which the shares underwritten by
it and distributed to the public were offered to the public exceeds the
amount of damages which such Underwriter has otherwise been required to
pay by reason of any 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. For purposes of
this Section 6, each person, if any, who controls an Underwriter within
the meaning of Section 15 of the Securities Act or Section 20 of the
Exchange Act shall have the same rights to contribution as such
Underwriter, and each director of the Company including any person who,
with his or her consent, is named in the Registration Statement as
about to become a director of the Company, each officer of the Company
who signed the Registration Statement, and each person, if any, who
controls the Company within the meaning of the Section 15 of the
Securities Act or Section 20 of the Exchange Act, shall have the same
rights to contribution as the Company. Any party entitled to
contribution will, promptly after receipt of notice of commencement of
any action, suit or proceeding against such party in respect of which a
claim for contribution may be made against another party or parties
under this Section 6, notify such party or parties from whom
contribution may be sought, but the omission so to notify such party or
parties from whom contribution may be sought shall not relieve the
party or parties from whom contribution may be sought from any other
obligation it or they may have hereunder or otherwise than under this
Section 6. No party shall be liable for contribution with respect to
any action, suit, proceeding or claim settled without its written
consent. The Underwriters' obligations to contribute pursuant to this
Section 6 are several in proportion to their respective underwriting
commitments and not joint.
7. Termination.
(a) This Agreement may be terminated with respect to the
Shares to be purchased on a Closing Date by the Underwriters by
notifying the Company at any time at or before a Closing Date in the
absolute discretion of the Underwriters if: (i) there has occurred any
material adverse change in the securities markets or any event, act or
occurrence that has materially disrupted, or in the opinion of the
Underwriters, will in the future materially disrupt, the securities
markets or there shall be such a material adverse change in general
financial, political or economic conditions or the effect of
international conditions on the financial markets in the United States
is such as to make it, in the judgment of the Underwriters, inadvisable
or impracticable to market the Shares or enforce contracts for the sale
of the Shares; (ii) there has occurred any outbreak or material
escalation of hostilities or other calamity or crisis, the effect of
which on the financial markets of the United States is such as to make
it, in the judgment of the Underwriters, inadvisable or impracticable
to market the Shares or enforce contracts for the sale of the Shares;
(iii)
24
trading in the Shares or any securities of the Company has been
suspended or materially limited by the Commission, or trading generally
on the New York Stock Exchange, Inc., the American Stock Exchange, Inc.
or the The Nasdaq National Market has been suspended or materially
limited, or minimum or maximum ranges for prices for securities shall
have been fixed, or maximum ranges for prices for securities have been
required, by said any of said exchanges or by such system or by order
of the Commission, the National Association of Securities Dealers,
Inc., or any other governmental or regulatory authority; or (iv) a
banking moratorium has been declared by any state or Federal authority;
or (v) in the judgment of the Underwriters, there has been, since the
time of execution of this Agreement or since the respective dates as of
which information is given in the Prospectus, any material adverse
change in the assets, properties, condition, financial or otherwise, or
in the results of operations, business affairs or business prospects of
the Company and its subsidiaries considered as a whole, whether or not
arising in the ordinary course of business.
(b) If this Agreement is terminated pursuant to any of its
provisions, the Company shall not be under any liability to the
Underwriters, and the Underwriters shall not be under any liability to
the Company, except that (i) if this Agreement is terminated by the
Underwriters because of any failure, refusal or inability on the part
of the Company to comply with the terms or to fulfill any of the
conditions of this Agreement, the Company will reimburse the
Underwriters for all out-of-pocket expenses (including the reasonable
fees and disbursements of its counsel) incurred by them in connection
with the proposed purchase and sale of the Shares or in contemplation
of performing their obligations hereunder and (ii) if any Underwriter
fails or refuses to purchase the Shares agreed to be purchased by it
under this Agreement, without some reason sufficient hereunder to
justify cancellation or termination of its obligations under this
Agreement, it shall not be relieved of liability to the Company for
damages occasioned by its failure or refusal.
8. Substitution of Underwriters. If any Underwriter shall
default in its obligation to purchase on any Closing Date the Shares agreed to
be purchased hereunder on such Closing Date, the Underwriters (as defined in
this Section 8) shall have the right, within 36 hours thereafter, to make
arrangements for one or more of the non-defaulting Underwriters, or any other
underwriters, to purchase such Shares on the terms contained herein. If,
however, the Underwriters shall not have completed such arrangements within such
36-hour period, then the Company shall be entitled to a further period of 36
hours within which to procure another party or other parties satisfactory to the
Underwriters to purchase such Shares on such terms. If, after giving effect to
any arrangements for the purchase of the Shares of a defaulting Underwriter or
Underwriters by the Underwriters and the Company as provided above, the
aggregate number of Shares which remains unpurchased on such Closing Date does
not exceed one-eleventh of the aggregate number of all the Shares that all the
Underwriters are obligated to purchase on such date, then the Company shall have
the right to require each non-defaulting Underwriter to purchase the number of
Shares which such Underwriter agreed to purchase hereunder at such date and, in
addition, to require each non-defaulting Underwriter to purchase its pro rata
share (based on the number of Shares which such Underwriter agreed to purchase
hereunder) of the Shares of such defaulting Underwriter or Underwriters for
which such arrangements have not been made; but nothing herein shall relieve a
defaulting Underwriter from liability for its default. In any such case, either
the Underwriters or the Company shall have the right to postpone the
25
applicable Closing Date for a period of not more than seven days in order to
effect any necessary changes and arrangements (including any necessary
amendments or supplements to the Registration Statement or Prospectus or any
other documents), and the Company agrees to file promptly any amendments to the
Registration Statement or the Prospectus, which in the opinion of the Company
and the Underwriters and their counsel may thereby be make necessary.
If, after giving effect to any arrangements for the purchase
of the Shares of a defaulting Underwriter or Underwriters by the Underwriters
and the Company as provided above, the aggregate number of such Shares which
remains unpurchased exceeds 10% of the aggregate number of all the Shares to be
purchased at such date, then this Agreement, or, with respect to a Closing Date
which occurs after the First Closing Date, the obligations of the Underwriters
to purchase and of the Company, as the case may be, to sell the Option Shares to
be purchased and sold on such date, shall terminate, without liability on the
part of any non-defaulting Underwriter to the Company, and without liability on
the part of the Company, except as provided in Sections 4(b), 5, 6 and 7. The
provisions of this Section 8 shall not in any way affect the liability of any
defaulting Underwriter to the Company or the nondefaulting Underwriters arising
out of such default. The term "Underwriter" as used in this Agreement shall
include any person substituted under this Section 8 with like effect as if such
person had originally been a party to this Agreement with respect to such
Shares.
9. Miscellaneous. The respective agreements, representations,
warranties, indemnities and other statements of the Company, and the
Underwriters, as set forth in this Agreement or made by or on behalf of them
pursuant to this Agreement, shall remain in full force and effect, regardless of
any investigation (or any statement as to the results thereof) made by or on
behalf of any Underwriter or the Company or the or any of their respective
officers, directors or controlling persons referred to in Sections 5 and 6
hereof, and shall survive delivery of and payment for the Shares. In addition,
the provisions of Sections 4(b), 5, 6 and 7 shall survive the termination or
cancellation of this Agreement.
This Agreement has been and is made for the benefit of the
Underwriters, the Company and their respective successors and assigns, and, to
the extent expressed herein, for the benefit of persons controlling any of the
Underwriters, or the Company, and directors and officers of the Company, and
their respective successors and assigns, and no other person shall acquire or
have any right under or by virtue of this Agreement. The term "successors and
assigns" shall not include any purchaser of Shares from the Underwriters merely
because of such purchase.
All notices and communications hereunder shall be in writing
and mailed or delivered or by telephone or telegraph if subsequently confirmed
in writing, (a) if to the Underwriters, to CIBC World Markets Corp., 000 0xx
Xxxxxx, 0xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxxxxx Xxxxxxx, Esq.,
with a copy to Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP, Xxxx Xxxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000, Attention: Xxxxx X. Xxxxxxxxxxx, Esq. and (b) if to the
Company, to its agent for service as such agent's address appears on the cover
page of the Registration Statement with a copy to Xxxxxx, Xxxx & Xxxxxxxx, LLP,
0000 Xxxxxxx Xxxx Xxxx, Xxx Xxxxxxx, Xxxxxxxxxx 00000, Attention: Xxxxxxx X.
Xxxx, Esq.
26
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
This Agreement may be signed in any number of counterparts,
each of which
27
shall be an original, with the same effect as if the signatures thereto and
hereto were upon the same instrument.
Please confirm that the foregoing correctly sets forth the
agreement among us.
Very truly yours,
COEUR D'XXXXX XXXXX
CORPORATION
By: /s/ Xxxxxx Xxxxxxx
-------------------------------
Title: Chairman and
Chief Executive Officer
Confirmed:
CIBC WORLD MARKETS CORP.
By: /s/ Xxxxxxx Xxxxxxxx
-----------------------------------
Title: Managing Director
ORION SECURITIES (USA) INC.
By: /s/ Xxxx Xxxx
-----------------------------------
Title: Managing Director
SPROTT SECURITIES (U.S.A.) LIMITED
By: /s/ Xxxx Xxxxxxx
-----------------------------------
Title: Chief Financial Officer
28
SCHEDULE I
Number of
Firm Shares
to Be
Name Purchased
---- ------------
CIBC World Markets Corp. 18,571,500
Orion Securities (U.S.A.) Inc. 1,031,750
Sprott Securities (USA) Limited 1,031,750
----------
Total 20,635,000
Sch I - 1
SCHEDULE II
[Lock-up Signatories]
Sch II - 1
Exhibit A
[FORM OF LOCK-UP AGREEMENT]
_____, 2003
CIBC WORLD MARKETS CORP.
ORION SECURITIES (U.S.A.) INC.
SPROTT SECURITIES (USA) LIMITED
c/o CIBC World Markets Corp.
CIBC World Markets Tower
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: Public Offering of Common Stock of Coeur d'Xxxxx Xxxxx Corporation
Gentlemen:
The undersigned, a holder of common stock ("Common Stock") or rights to
acquire Common Stock, of Coeur d'Xxxxx Xxxxx Corporation (the "Company")
understands that the Company intends to file a prospectus supplement to its
Registration Statement on Form S-3 (the "Registration Statement") with the
Securities and Exchange Commission (the "Commission") on or about September 11,
2003, related to the offering of approximately 23,730,250 shares of Common Stock
(including 3,095,250 shares subject to an over-allotment option on the part of
the Underwriters) (the "Offering"). The undersigned further understands that you
are contemplating entering into an Underwriting Agreement with the Company in
connection with the Offering.
In order to induce the Company and you to enter into the Underwriting
Agreement and to proceed with the Offering, the undersigned agrees, for the
benefit of the Company and you, that should the Offering be effected the
undersigned will not, without your prior written consent, directly or
indirectly, make any offer, sale, assignment, transfer, encumbrance, contract to
sell, grant of an option to purchase or other disposition of any Common Stock
beneficially owned (within the meaning of Rule 13d-3 under the Securities
Exchange Act of 1934, as amended) by the undersigned on the date hereof or
hereafter acquired for a period of 90 days subsequent to the date of the
Underwriting Agreement, other than Common Stock to be sold in the Offering or
transferred as a gift or gifts (provided that any donee thereof agrees in
writing to be bound by the terms hereof).
The undersigned, whether or not participating in the Offering, confirms
that he, she or it understands that the Underwriters and the Company will rely
upon the representations set forth in this agreement in proceeding with the
Offering. This agreement shall be binding on the undersigned and his, her or its
respective successors, heirs, personal representatives and assigns.
A - 1
The undersigned agrees and consents to the entry of stop-transfer instructions
with the Company's transfer agent against the transfer of Common Stock or
securities convertible into or exchangeable or exercisable for Common Stock held
by the undersigned except in compliance with this agreement.
Very truly yours,
Dated: ______________________, 2003 ______________________________________
Signature
______________________________________
Printed Name and Title (if applicable)
A - 2
