UNIVERSAL COMPRESSION HOLDINGS, INC. 6,750,000 Shares of Common Stock Underwriting Agreement
Exhibit 1.1 |
UNIVERSAL COMPRESSION HOLDINGS, INC.
6,750,000 Shares of Common Stock
December 8, 2005
X.X. Xxxxxx Securities Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Xxxxxxxxxxx International Ltd., a company incorporated under the laws of Bermuda (the “Selling
Stockholder”), propose to sell to X.X. Xxxxxx Securities, Inc. (the “Underwriter”), an aggregate of
6,750,000 shares (the “Shares”) of Common Stock, par value $0.01 per share (the “Stock”), of
Universal Compression Holdings, Inc., a Delaware corporation (the “Company”).
Each of the Company and the Selling Stockholder hereby confirms its agreement with the
Underwriter concerning the purchase and sale of the Shares, as follows:
2
deemed to refer to and include the documents incorporated by reference therein pursuant to Item 12
of Form S-3 under the Securities Act, as of the effective date of the Registration Statement or the
date of such Preliminary Prospectus or the Prospectus, as the case may be, and any reference to
“amend”, “amendment” or “supplement” with respect to the Registration Statement, any Preliminary
Prospectus or the Prospectus shall be deemed to refer to and include any documents filed after such
date under the Securities Exchange Act of 1934, as amended, and the rules and regulations of the
Commission thereunder (collectively, the “Exchange Act”) that are deemed to be incorporated by
reference therein. Capitalized terms used but not defined herein shall have the meanings given to
such terms in the Registration Statement and the Prospectus.
At or prior to the time when sales of the Shares were first made (the “Time of Sale”), the
Company had prepared the following information (collectively with the information referred to in
the next succeeding sentence, the “Time of Sale Information”): a Preliminary Prospectus dated March
9, 2005 (as amended to the Time of Sale) and the information listed on Annex C hereto. If,
subsequent to the date of this Agreement, the Company and the Underwriter have determined that such
Time of Sale Information included an untrue statement of a material fact or omitted a statement of
material fact necessary to make the information therein, in the light of the circumstances under
which it was made, not misleading and have agreed to provide an opportunity to purchasers of the
Shares to terminate their old purchase contracts and enter into new purchase contracts, then “Time
of Sale Information” will refer to the information available to purchasers at the time of entry
into the first such new purchase contract.
(b) The Selling Stockholder understands that the Underwriter intends to make a public offering
of the Shares as soon after the effectiveness of this Agreement as in the judgment of the
Underwriter is advisable, and initially to offer the Shares on the terms set forth in the
Prospectus. The Selling Stockholder acknowledges and agrees that the Underwriter may offer and
sell Shares to or through any affiliate of the Underwriter and that any such affiliate may offer
and sell Shares purchased by it to or through the Underwriter.
(c) Payment for the Shares shall be made by wire transfer in immediately available funds to
the account specified by the Selling Stockholder (as defined below) to the Underwriter at the
offices of Xxxxxx & Xxxxxx L.L.P., 0000 Xxxxxx, Xxxxxxx, Xxxxx 00000, at 10:00 A.M. New York City
time on Wednesday, December 14, 2005, or at such other time or place on the same or such other
date, not later than the fifth business day thereafter, as the Underwriter and the Selling
Stockholder may agree upon in writing. The time and date of such payment is referred to herein as
the “Closing Date”.
Payment for the Shares shall be made against delivery to the Underwriter for the account of
the Underwriter of the Shares in definitive form registered in such names and in such
3
denominations as the Underwriter shall request in writing not later than two full business days
prior to the Closing Date, with any transfer taxes payable in connection with the sale of the
Shares duly paid by the Selling Stockholder. The certificates for the Shares will be made
available for inspection and packaging by the Underwriter at the office of X.X. Xxxxxx Securities
Inc. set forth above not later than 1:00 P.M., New York City time, on the business day prior to the
Closing Date.
(d) As compensation to the Underwriter for its commitments hereunder, the Selling Stockholder
will pay, or cause to be paid, to X.X. Xxxxxx Securities Inc., for the account of the Underwriter,
an amount equal to $41.00 per share for the Shares to be delivered by the Selling Stockholder
hereunder on the Closing Date. On December 14, 2005, or on such other date, not later than the
fifth Business Day thereafter, as the Underwriter and the Selling Stockholder may agree upon in
writing, the Selling Stockholder will pay or cause to be paid by wire transfer, in immediate
available funds, such commission to the account specified by X.X. Xxxxxx Securities Inc.
(e) Each of the Company and the Selling Stockholder acknowledges and agrees that the
Underwriter is acting solely in the capacity of an arm’s length contractual counterparty to the
Selling Stockholder with respect to the offering of Shares contemplated hereby (including in
connection with determining the terms of the offering) and not as a financial advisor or a
fiduciary to, or an agent of, the Company, the Selling Stockholder or any other person.
Additionally, the Underwriter is not advising the Company, the Selling Stockholder or any other
person as to any legal, tax, investment, accounting or regulatory matters in any jurisdiction. The
Company and the Selling Stockholder shall consult with their own advisors concerning such matters
and shall be responsible for making their own independent investigation and appraisal of the
transactions contemplated hereby, and the Underwriter shall have no responsibility or liability to
the Company or the Selling Stockholder with respect thereto. Any review by the Underwriter of the
Company, the transactions contemplated hereby or other matters relating to such transactions will
be performed solely for the benefit of the Underwriter and shall not be on behalf of the Company or
the Selling Stockholder.
4
5
Information, 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 will not contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements therein, in the
light of the circumstances under which they were made, not misleading.
6
of their respective businesses requires such qualification, and have all power and authority
necessary to own or hold their respective properties and to conduct the businesses in which they
are engaged, except where the failure to be so qualified or have such power or authority would not,
individually or in the aggregate, have a Material Adverse Effect.
(k) Underwriting Agreement. This Agreement has been duly authorized, executed and delivered
by the Company.
(l) Descriptions of Underwriting Agreement. This Agreement conforms in all material respects
to the description thereof contained in the Registration Statement, the Time of Sale Information
and the Prospectus.
7
case of clauses (ii) and (iii) above, for any such default or violation that would not,
individually or in the aggregate, have a Material Adverse Effect.
8
9
foreign taxes and filed all tax returns required to be paid or filed through the date hereof, other
than those being contested in good faith; and (2) except as otherwise disclosed in the Registration
Statement, the Time of Sale Information and the Prospectus, there is no tax deficiency that has
been, or is expected to be, asserted against the Company or any of its subsidiaries or any of their
respective properties or assets.
10
occurred with respect to any such plan excluding transactions effected pursuant to a statutory or
administrative exemption; and for each such plan that is subject to the funding rules of Section
412 of the Code or Section 302 of ERISA, no “accumulated funding deficiency” as defined in Section
412 of the Code has been incurred, whether or not waived, and the fair market value of the assets
of each such plan (excluding for these purposes accrued but unpaid contributions) exceeds the
present value of all benefits accrued under such plan determined using reasonable actuarial
assumptions.
11
obtain similar coverage at reasonable cost from similar insurers as may be necessary to continue
its business.
12
(nn) Status under the Securities Act. The Company is not an ineligible issuer as defined
under the Securities Act, in each case at the times specified in the Securities Act in connection
with the offering of the Shares.
(oo) New York Stock Exchange. The Shares are listed on the New York Stock Exchange (the
“Exchange”).
(a) Required Consents; Authority. All consents, approvals, authorizations and orders
necessary for the execution and delivery by the Selling Stockholder of this Agreement, and for the
sale and delivery of the Shares to be sold by the Selling Stockholder hereunder, have been
obtained; and the Selling Stockholder has full right, power and authority to enter into this
Agreement, and to sell, assign, transfer and deliver the Shares to be sold by the Selling
Stockholder hereunder; this Agreement has been duly authorized, executed and delivered by the
Selling Stockholder.
13
(b) No Conflicts. The execution, delivery and performance by the Selling Stockholder of this
Agreement, the sale of the Shares to be sold by the Selling Stockholder and the consummation by the
Selling Stockholder of the transactions herein contemplated will not (i) conflict with or result in
a breach or violation of any of the terms or provisions of, or constitute a default under, or
result in the creation or imposition of any lien, charge or encumbrance upon any property or assets
of the Selling Stockholder pursuant to, any indenture, mortgage, deed of trust, loan agreement or
other agreement or instrument to which the Selling Stockholder is a party or by which the Selling
Stockholder is bound or to which any of the property or assets of the Selling Stockholder is
subject, (ii) result in any violation of the provisions of the charter or by-laws or similar
organizational documents of the Selling Stockholder or (iii) result in the violation of any law or
statute or any judgment, order, rule or regulation of any court or arbitrator or governmental or
regulatory agency.
(c) Title to Shares. The Selling Stockholder has good and valid title to the Shares to be
sold at the Closing Date by the Selling Stockholder hereunder, free and clear of all liens,
encumbrances, equities or adverse claims; and, upon delivery of the certificates representing such
Shares and payment therefor pursuant hereto, good and valid title to such Shares, free and clear of
all liens, encumbrances, equities or adverse claims, will pass to the Underwriter.
(d) No Stabilization. The Selling Stockholder has not taken and will not take, directly or
indirectly, any action designed to or that could reasonably be expected to cause or result in any
stabilization or manipulation of the price of the Shares.
(e) Information Provided by the Selling Stockholder. The information furnished to the
Company in writing by the Selling Stockholder expressly for use in the Registration Statement, the
Prospectus (or any amendment or supplement thereto), any Issuer Free Writing Prospectus or any Time
of Sale Information (including any Time of Sale Information that has subsequently been amended),
which information shall solely consist of (i) the name and address of the Selling Stockholder and
(ii) the enumeration of the Shares to be sold by the Selling Stockholder to the Underwriter
pursuant to this Agreement does not and shall not contain any untrue statement.
(f) Issuer Free Writing Prospectus. Other than the Preliminary Prospectus and the Prospectus,
the Selling Stockholder (including its agents and representatives, other than the Underwriter in
its capacity as such) has not made, used, prepared, authorized, approved or referred to and will
not prepare, make, use, authorize, approve or refer to any Issuer Free Writing Prospectus, other
than (i) any document not constituting a prospectus pursuant to Section 2(a)(10)(a) of the
Securities Act or Rule 134 under the Securities Act or (ii) the documents listed on Annex C hereto.
(g) Material Information. As of the date hereof and as of the Closing Date, that the sale of
the Shares by the Selling Stockholder is not and will not be prompted by any material information
concerning the Company that is not set forth in the Registration Statement, the Time of Sale
Information or the Prospectus.
14
The Selling Stockholder specifically agrees that the obligations of the Selling Stockholder
hereunder shall not be terminated by operation of law, whether by the dissolution of the Selling
Stockholder, or by the occurrence of any other event. If the Selling Stockholder should be
dissolved, or if any other such event should occur, before the delivery of the Shares hereunder,
certificates representing such Shares shall be delivered by or on behalf of the Selling Stockholder
in accordance with the terms and conditions of this Agreement, shall be as valid as if such
dissolution or other event had not occurred.
(a) Required Filings. The Company will file the final Prospectus with the Commission within
the time periods specified by Rule 424(b) and Rule 430A, 430B or 430C under the Securities Act ,
will file any Issuer Free Writing Prospectus to the extent required by Rule 433 under the
Securities Act; and will file promptly all reports and any definitive proxy or information
statements required to be filed by the Company with the Commission pursuant to Section 13(a),
13(c), 14 or 15(d) of the Exchange Act subsequent to the date of the Prospectus and for so long as
the delivery of a prospectus is required in connection with the offering or sale of the Shares; and
the Company will furnish copies of the Prospectus and each Issuer Free Writing Prospectus (to the
extent not previously delivered) to the Underwriter in New York City prior to 10:00 A.M., New York
City time, on the business day next succeeding the date of this Agreement in such quantities as the
Underwriter may reasonably request.
15
16
amended or supplemented will not, in the light of the circumstances, be misleading or so that the
Time of Sale Information will comply with law.
17
(b) Tax Form. It will deliver to the Underwriter prior to or at the Closing Date a properly
completed and executed United States Treasury Department Form W-9 (or other applicable form or
statement specified by the Treasury Department regulations in lieu thereof) in order to facilitate
the Underwriter’s documentation of their compliance with the reporting and withholding provisions
of the Tax Equity and Fiscal Responsibility Act of 1982 with respect to the transactions herein
contemplated.
7. Certain Agreements of the Underwriter. The Underwriter hereby represents and
agrees that:
(a) It has not and will not use, authorize use of, refer to, or participate in the planning
for use of, any “free writing prospectus”, as defined in Rule 405 under the Securities Act (which
term includes use of any written information furnished to the Commission by the Company and not
incorporated by reference into the Registration Statement and any press release issued by the
Company) other than (i) a free writing prospectus that contains no “issuer information” (as defined
in Rule 433(h)(2) under the Securities Act) that was not included (including through incorporation
by reference) in a previously filed Issuer Free Writing Prospectus, (ii) any Issuer Free Writing
Prospectus listed on Annex C, or (iii) any free writing prospectus prepared by the Underwriter and
approved by the Company in advance in writing (each such free writing prospectus referred to in
clauses (i) or (iii), an “Underwriter Free Writing Prospectus”).
(b) It has not and will not distribute any Underwriter Free Writing Prospectus referred to in
clause (a)(i) in a manner reasonably designed to lead to its broad unrestricted dissemination.
18
(c) It has not and will not, without the prior written consent of the Company, use any free
writing prospectus that contains the final terms of the Shares unless such terms have previously
been included in a free writing prospectus filed with the Commission; provided that Underwriter may
use a term sheet substantially in the form of Annex D hereto without the consent of the Company;
provided further that any Underwriter using such term sheet shall notify the Company, and provide a
copy of such term sheet to the Company, prior to, or substantially concurrently with, the first use
of such term sheet.
(d) It will, pursuant to reasonable procedures developed in good faith, retain copies of each
free writing prospectus used or referred to by it, in accordance with Rule 433 under the Securities
Act.
(e) It is not subject to any pending proceeding under Section 8A of the Securities Act with
respect to the offering (and will promptly notify the Company if any such proceeding against it is
initiated during the Prospectus Delivery Period).
19
rating organization”, as such term is defined by the Commission for purposes of Rule 436(g)(2)
under the Securities Act and (ii) no such organization shall have publicly announced that it has
under surveillance or review, or has changed its outlook with respect to, its rating of any
securities or preferred stock of or guaranteed by the Company or any of its subsidiaries (other
than an announcement with positive implications of a possible upgrading).
20
written opinion, dated the Closing Date and addressed to the Underwriter, in form and substance
reasonably satisfactory to the Underwriter, to the effect set forth in Annex A hereto.
All opinions, letters, certificates and evidence mentioned above or elsewhere in this
Agreement shall be deemed to be in compliance with the provisions hereof only if they are in form
and substance reasonably satisfactory to counsel for the Underwriter.
21
to make the statements therein, not misleading, (ii) or any untrue statement or alleged untrue
statement of a material fact contained in the Prospectus (or any amendment or supplement thereto),
any Issuer Free Writing Prospectus or any Time of Sale Information (including any Time of Sale
Information that has subsequently been amended), or caused by any omission or alleged omission to
state therein a material fact necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading, in each case except insofar as such
losses, claims, damages or liabilities arise out of, or are based upon, any untrue statement or
omission or alleged untrue statement or omission made in reliance upon and in conformity with any
information relating to the Underwriter furnished to the Company in writing by the Underwriter
expressly for use therein, it being understood and agreed that the only such information furnished
by the Underwriter consists of the information described as such in subsection (c) below.
22
Underwriter expressly for use in the Registration Statement, the Prospectus (or any amendment or
supplement thereto), any Issuer Free Writing Prospectus or any Time of Sale Information, it being
understood and agreed upon that the only such information furnished by the Underwriter consists of
the information in the Prospectus described in paragraph 7 under the caption “Underwriting” related
to short sales and stabilization transaction.
23
consent of the Indemnified Person, effect any settlement of any pending or threatened proceeding in
respect of which any Indemnified Person is or could have been a party and indemnification could
have been sought hereunder by such Indemnified Person, unless such settlement (x) includes an
unconditional release of such Indemnified Person, in form and substance reasonably satisfactory to
such Indemnified Person, from all liability on claims that are the subject matter of such
proceeding and (y) does not include any statement as to or any admission of fault, culpability or a
failure to act by or on behalf of any Indemnified Person.
24
required to pay by reason of such untrue or alleged untrue statement or omission or alleged
omission. Notwithstanding the provisions of this Section 9, in no event shall the Selling
Stockholder be required to contribute any amount in excess of the aggregate amount of net proceeds
received by the Selling Stockholder from the sale of its Shares hereunder exceeds the amount of any
damages that the Selling stockholder has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent misrepresentation.
11. Termination. This Agreement may be terminated in the absolute discretion of the
Underwriter, by notice to the Company and the Selling Stockholder, if after the execution and
delivery of this Agreement and prior to the Closing Date (i) trading generally shall have been
suspended or materially limited on or by any of the Exchange, the American Stock Exchange, the
National Association of Securities Dealers, Inc., the Chicago Board Options Exchange, the Chicago
Mercantile Exchange or the Chicago Board of Trade; (ii) trading of any securities issued or
guaranteed by the Company shall have been suspended on any exchange or in any over-the-counter
market; (iii) a general moratorium on commercial banking activities shall have been declared by
federal or New York State authorities; (iv) there shall have occurred any outbreak or escalation of
hostilities or any change in financial markets or any calamity or crisis, either within or outside
the United States, that, in the judgment of the Underwriter, is material and adverse and makes it
impracticable or inadvisable to proceed with the offering, sale or delivery of the Shares on the
terms and in the manner contemplated by this Agreement, the Time of Sale Information and the
Prospectus; or (v) the representation in Section 3(b) is incorrect in any respect.
25
transfer agent and any registrar; (viii) all expenses and application fees incurred in connection
with any filing with, and clearance of the offering by, the National Association of Securities
Dealers, Inc.; (ix) all expenses incurred by the Company in connection with any “road show”
presentation to potential investors; and (x) all expenses and application fees related to the
listing of the Shares on the Exchange; provided, however, that the Underwriter shall be responsible
for the fees and expenses of the Underwriter’s counsel whether or not the transactions contemplated
by this Agreement are consummated or whether this Agreement is terminated .
15. Certain Defined Terms. For purposes of this Agreement, (a) except where otherwise
expressly provided, the term “affiliate” has the meaning set forth in Rule 405 under the Securities
Act; (b) the term “business day” means any day other than a day on which banks are permitted or
required to be closed in New York City; and (c) the term “subsidiary” has the meaning set forth in
Rule 405 under the Securities Act; and (d) the term “significant subsidiary” has the meaning set
forth in Rule 1-02 of Regulation S-X under the Exchange Act.
26
27
If the foregoing is in accordance with your understanding, please indicate your
acceptance of this Agreement by signing in the space provided below.
Very truly yours, UNIVERSAL COMPRESSION HOLDINGS, INC. |
||||
By: | /s/ X. Xxxxxxx Childers | |||
Name: | X. Xxxxxxx Childers | |||
Title: | Senior Vice President and General Counsel |
|||
XXXXXXXXXXX INTERNATIONAL LTD., the Selling Stockholder |
||||
By: | /s/ Xxxx X. Xxxxxxxxx | |||
Name: | Xxxx X. Xxxxxxxxx | |||
Title: | Senior Vice President and Chief Financial Officer |
|||
Accepted: December 8, 2005
X.X. XXXXXX SECURITIES INC.
By
|
/s/ Xxx Xxxxxxx — Duodu | |
Authorized Signatory |