EXHIBIT 1(b)
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________________________________________________________________________________
IMC GLOBAL INC.
(a Delaware corporation)
REGISTRATION AGREEMENT
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Dated: July 2, 1996
________________________________________________________________________________
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Table of Contents
REGISTRATION AGREEMENT......................................................... 1
SECTION 1. Representations and Warranties.................... 3
(a) Representations and Warranties by the Company..... 3
(i) Compliance with Registration Requirements......... 3
(ii) Incorporated Documents............................ 4
(iii) Independent Accountants........................... 4
(iv) Financial Statements.............................. 4
(v) No Material Adverse Change in Business............ 5
(vi) Good Standing of the Company...................... 5
(vii) Good Standing of Subsidiaries..................... 5
(viii) Capitalization.................................... 6
(ix) Description of Common Stock....................... 6
(x) Authorization of Agreement........................ 6
(xi) Absence of Defaults and Conflicts................. 6
(xii) Absence of Labor Dispute.......................... 6
(xiii) Absence of Proceedings............................ 7
(xiv) Accuracy of Exhibits.............................. 7
(xv) Possession of Intellectual Property............... 7
(xvi) Absence of Further Requirements................... 7
(xvii) Possession of Licenses and Permits................ 7
(xviii) Title to Property................................. 8
(xix) Compliance with Cuba Act.......................... 8
(xx) Investment Company Act............................ 8
(xxi) Environmental Laws................................ 8
(b) Officer's Certificates............................ 9
SECTION 2. Covenants of the Company.......................... 9
(a) Compliance with Securities Regulations and
Commission Requests............................... 9
(b) Filing of Amendments.............................. 9
(c) Delivery of IMC Registration Statements........... 10
(d) Delivery of IMC Prospectuses...................... 10
(e) Continued Compliance with Securities Laws......... 10
(f) Blue Sky Qualifications........................... 11
(g) Rule 158.......................................... 11
(h) Restriction on Sale of Securities by the Company.. 11
(i) Restriction on Sale of Securities by Directors.... 11
(j) Reporting Requirements............................ 12
SECTION 3. Payment of Expenses............................... 12
(a) Expenses.......................................... 12
SECTION 4. Indemnification................................... 12
(a) Indemnification of Underwriter and ML&Co.......... 12
(b) Indemnification of Company, Directors, Officers... 13
(c) Actions against Parties; Notification............. 13
(d) Settlement without Consent if Failure to Reimburse 14
i
SECTION 5. Contribution...................................... 14
SECTION 6. Representations, Warranties and Agreements to
Survive Delivery.................................. 15
SECTION 7. Termination....................................... 16
SECTION 8. Notices........................................... 16
SECTION 9. Parties........................................... 16
SECTION 10. GOVERNING LAW..................................... 16
SECTION 11. Effect of Headings................................ 16
SCHEDULE A........................................................... Sch A-1
ii
IMC GLOBAL INC.
(a Delaware corporation)
REGISTRATION AGREEMENT
----------------------
July 2, 1996
MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
North Tower
World Financial Center
New York, New York 10281-1209
MERRILL LYNCH & CO., INC.
North Tower
World Financial Center
New York, New York 10281-1209
Ladies and Gentlemen:
IMC Global Inc., a Delaware corporation (the "Company"), confirms its
agreement with Merrill Lynch & Co., Inc., a Delaware corporation ("ML&Co."), and
Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated (the
"Underwriter"), in connection with the proposed issue and sale by ML&Co. to the
Underwriter, pursuant to an underwriting agreement, dated the date hereof (the
"Underwriting Agreement"), among ML&Co., GVI Holdings, Inc., a Delaware
corporation ("GVI"), and the Underwriter, of an aggregate of 5,661,119 of
ML&Co.'s Structured Yield Product Exchangeable for Stock/SM/, 6 1/4% STRYPES/SM/
Due July 1, 2001 (each, a "STRYPES"), payable at maturity by delivery of shares
of common stock, par value $1.00 per share (the "IMC Common Stock"), of the
Company, and, at the option of the Underwriter, all or any part of 849,167
additional STRYPES to cover over-allotments, if any.
_______________
/SM/ Service mark of Merrill Lynch & Co., Inc.
1
The aforesaid 5,661,119 STRYPES (the "Initial Securities") to be purchased by
the Underwriter and all or any part of the 849,167 STRYPES subject to the option
described in Section 2(b) of the Underwriting Agreement (the "Option
Securities") are hereinafter called, collectively, the "Securities."
Capitalized terms used herein and not otherwise defined shall have the meanings
ascribed to them in the Underwriting Agreement.
The Company understands that the Underwriter proposes to make a public
offering of the Securities as soon as the Underwriter deems advisable after this
Agreement and the Underwriting Agreement have been executed and delivered. The
Company acknowledges that the execution and delivery of this Agreement is a
condition to the execution and delivery of the Underwriting Agreement by the
Underwriter and ML&Co. and that, in consideration of the execution and delivery
of the Underwriting Agreement by the Underwriter and ML&Co., the Company is
willing to make the representations, warranties and covenants herein contained.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (No. 333-04831) covering the
registration under the Securities Act of 1933, as amended (the "1933 Act"), of
the shares of IMC Common Stock deliverable upon payment and discharge of the
Securities, including the related preliminary prospectus or prospectuses. Each
prospectus used before such registration statement became effective is herein
called an "IMC preliminary prospectus." Such registration statement, including
the exhibits thereto, the schedules thereto, if any, and the documents
incorporated by reference therein pursuant to Item 12 of Form S-3 under the 1933
Act, at the time it became effective, is herein called the "IMC Registration
Statement." Any registration statement filed pursuant to Rule 462(b) of the
rules and regulations of the Commission under the 1933 Act (the "1933 Act
Regulations") is herein referred to as the "IMC Rule 462(b) Registration
Statement," and after such filing the term "IMC Registration Statement" shall
include the IMC Rule 462(b) Registration Statement. The final prospectus,
including the documents incorporated by reference therein pursuant to Item 12 of
Form S-3 under the 1933 Act, in the form first furnished to the Underwriter for
use in connection with the offering of the Securities is herein called the "IMC
Prospectus." For purposes of this Agreement, all references to the IMC
Registration Statement, any IMC preliminary prospectus, the IMC Prospectus or
any amendment or supplement to any of the foregoing shall be deemed to include
the copy filed with the Commission pursuant to its Electronic Data Gathering,
Analysis and Retrieval system ("EDGAR").
All references in this Agreement to financial statements and schedules and
other information which are "contained," "included" or "stated" in the IMC
Registration Statement, any IMC preliminary prospectus or the IMC Prospectus (or
other references of like import) shall be deemed to mean and include all such
financial statements and schedules and other information which are incorporated
by reference in the IMC Registration Statement, any IMC preliminary prospectus
or the IMC Prospectus, as the case may be; and all references in this Agreement
to amendments or supplements to the IMC Registration Statement, any IMC
preliminary prospectus or the IMC Prospectus shall be deemed to mean and include
the filing of any document under the Securities Exchange Act of 1934, as amended
(the "1934 Act"), which is incorporated by reference in the IMC Registration
Statement, such IMC preliminary prospectus or the IMC Prospectus, as the case
may be.
2
Prior to the closing under the Underwriting Agreement, ML&Co., Merrill
Lynch Mortgage Capital Inc., a wholly-owned subsidiary of ML&Co., and GVI will
enter into a contract, pursuant to which GVI will agree to sell and ML&Co. will
agree to purchase, immediately prior to the maturity date of the Securities, the
Maturity Consideration (as defined in the Supplemental Indenture) required by
ML&Co. to pay and discharge all of the Securities at maturity as described in
the ML&Co. Prospectus, subject to GVI's right to require that the obligations
thereunder be satisfied by a cash payment based on the value of such Maturity
Consideration.
SECTION 1. Representations and Warranties.
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(a) Representations and Warranties by the Company. The Company represents
and warrants to each of the Underwriter and to ML&Co. as of the date hereof, as
of the Closing Time referred to in Section 2(c) of the Underwriting Agreement,
and as of each Date of Delivery (if any) referred to in Section 2(b) of the
Underwriting Agreement, and agrees with each of the Underwriter and ML&Co. as
follows:
(i) Compliance with Registration Requirements. The Company meets the
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requirements for the use of Form S-3 under the 1933 Act. Each of the IMC
Registration Statement and any IMC Rule 462(b) Registration Statement has
become effective under the 1933 Act and no stop order suspending the
effectiveness of the IMC Registration Statement or any IMC Rule 462(b)
Registration Statement has been issued under the 1933 Act and no
proceedings for that purpose have been instituted or are pending or, to the
knowledge of the Company, are contemplated by the Commission, and any
request on the part of the Commission for additional information has been
complied with.
At the respective times the IMC Registration Statement, any IMC Rule
462(b) Registration Statement and any post-effective amendments thereto
became effective and at the Closing Time (and, if any Option Securities are
purchased, at the Date of Delivery), the IMC Registration Statement, the
IMC Rule 462(b) Registration Statement and any amendments and supplements
thereto complied and will comply in all material respects with the
requirements of the 1933 Act and the 1933 Act Regulations and did not and
will not contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading. Neither the IMC Prospectus nor any
amendments or supplements thereto, at the time the IMC Prospectus or any
such amendment or supplement was issued and at the Closing Time (and, if
any Option Securities are purchased, at the Date of Delivery), included or
will include an untrue statement of a material fact or omitted or will omit
to state a material fact necessary in order to make the statements therein,
in the light of the circumstances under which they were made, not
misleading. The representations and warranties in this subsection shall
not apply to statements in or omissions from the IMC Registration Statement
or IMC Prospectus made in reliance upon and in conformity with information
furnished to the Company in writing by the Underwriter, ML&Co. or GVI
expressly for use in the IMC Registration Statement or IMC Prospectus.
3
Each IMC preliminary prospectus and the IMC Prospectus filed as part
of the IMC Registration Statement as originally filed or as part of any
amendment thereto, or filed pursuant to Rule 424 under the 1933 Act,
complied when so filed in all material respects with the 1933 Act
Regulations and, if applicable, each IMC preliminary prospectus and the IMC
Prospectus delivered to the Underwriter for use in connection with the
offering of the Securities was identical to the electronically transmitted
copies thereof filed with the Commission pursuant to EDGAR, except to the
extent permitted by Regulation S-T.
(ii) Incorporated Documents. The documents incorporated or deemed to
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be incorporated by reference in the IMC Registration Statement and the IMC
Prospectus, when they became effective or at the time they were or
hereafter are filed with the Commission, complied and will comply in all
material respects with the requirements of the 1934 Act and the rules and
regulations of the Commission thereunder (the "1934 Act Regulations"), and,
when read together with the other information in the IMC Prospectus, at the
time the IMC Registration Statement and any post-effective amendments
thereto became effective, at the time the IMC Prospectus was issued and at
the Closing Time (and if any Option Securities are purchased, at the Date
of Delivery), did not and will not contain an untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading.
(iii) Independent Accountants. The accountants who certified the
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financial statements and supporting schedules of the Company and its
subsidiaries, and of The Vigoro Corporation and its subsidiaries
("Vigoro"), included in the IMC Registration Statement are independent
public accountants as required by the 1933 Act and the 1933 Act
Regulations.
(iv) Financial Statements. The financial statements of the Company
--------------------
(including the financial statements giving retroactive effect to the merger
of the Company and Vigoro) included in the IMC Registration Statement and
the IMC Prospectus, together with the related schedules and notes, 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; said financial statements have been
prepared in conformity with generally accepted accounting principles
("GAAP") applied on a consistent basis throughout the periods involved.
The financial statements of Vigoro included in the IMC Registration
Statement and the IMC Prospectus, together with the related notes, present
fairly the financial position of Vigoro and its consolidated subsidiaries
at the dates indicated and the statement of operations, stockholders'
equity and cash flows of Vigoro and its consolidated subsidiaries for the
periods specified; said financial statements have been prepared in
conformity with GAAP applied on a consistent basis throughout the periods
involved. The supporting schedules, if any, included in the IMC
Registration Statement present fairly in accordance with GAAP the
information required to be stated therein. The selected consolidated
financial information and the summary selected consolidated financial
information included in the IMC Prospectus present fairly the
4
information shown therein and have been compiled on a basis consistent with
that of the audited financial statements included in the IMC Registration
Statement. The pro forma financial statements and the other pro forma
financial information of the Company and its subsidiaries and the related
notes thereto included in the IMC Registration Statement and the IMC
Prospectus present fairly in accordance with GAAP the information shown
therein, have been prepared in accordance with the Commission's rules and
guidelines with respect to pro forma financial statements and have been
properly compiled on the bases described therein, and the assumptions used
in the preparation thereof are reasonable and the adjustments used therein
are appropriate to give effect to the transactions and circumstances
referred to therein.
(v) No Material Adverse Change in Business. Since the respective
--------------------------------------
dates as of which information is given in the IMC Registration Statement
and the IMC Prospectus, except as otherwise stated therein or contemplated
thereby, (A) there has been no material adverse change in the condition,
financial or otherwise, or in the earnings, business affairs or business
prospects of the Company and its subsidiaries considered as one enterprise,
whether or not arising in the ordinary course of business (a "Material
Adverse Effect"), (B) there have been no transactions entered into by the
Company or any of its subsidiaries, which are material with respect to the
Company and its subsidiaries considered as one enterprise, other than those
in the ordinary course of business, and (C) except for regular quarterly
dividends on its outstanding common stock, there has been no dividend or
distribution of any kind declared, paid or made by the Company on any class
of its capital stock.
(vi) Good Standing of the Company. The Company has been duly
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organized and is validly existing as a corporation in good standing under
the laws of the State of Delaware and has corporate power and authority to
own, lease and operate its properties and to conduct its business as
described in the IMC Prospectus and to enter into and perform its
obligations under this Agreement; and the Company is duly qualified as a
foreign corporation to transact business and is in good standing in each
other jurisdiction in which such qualification is required, whether by
reason of the ownership or leasing of property or the conduct of business,
except where the failure so to qualify or to be in good standing would not
result in a Material Adverse Effect.
(vii) Good Standing of Subsidiaries. Each "significant subsidiary"
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of the Company (as such term is defined in Rule 1-02 of Regulation S-X)
(each a "Subsidiary" and, collectively, the "Subsidiaries") has been duly
organized and is validly existing as a corporation in good standing under
the laws of the jurisdiction of its incorporation, has corporate power and
authority to own, lease and operate its properties and to conduct its
business as described in the IMC Prospectus and is duly qualified as a
foreign corporation to transact business and is in good standing in each
jurisdiction in which such qualification is required, whether by reason of
the ownership or leasing of property or the conduct of business, except
where the failure so to qualify or to be in good standing would not result
in a Material Adverse Effect; except as otherwise disclosed in the IMC
Registration Statement, all of the issued and outstanding capital stock of
each such Subsidiary has been duly authorized and validly issued, is fully
paid and non-assessable
5
and is owned by the Company, directly or through subsidiaries, free and
clear of any security interest, mortgage, pledge, lien, encumbrance, claim
or equity; none of the outstanding shares of capital stock of any
Subsidiary was issued in violation of the preemptive or similar rights of
any securityholder of such Subsidiary. The only subsidiaries of the Company
are (A) the subsidiaries listed on Schedule A hereto and (B) certain other
subsidiaries which, considered in the aggregate as a single Subsidiary, do
not constitute a "significant subsidiary" as defined in Rule 1-02 of
Regulation S-X.
(viii) Capitalization. The shares of outstanding capital stock of
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the Company have been duly authorized and validly issued and are fully paid
and non-assessable; none of the outstanding shares of capital stock of the
Company was issued in violation of the preemptive or other similar rights
of any securityholder of the Company.
(ix) Description of Common Stock. The IMC Common Stock conforms in
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all material respects to the description thereof contained in the IMC
Prospectus and such description conforms to the rights set forth in the
instruments defining the same.
(x) Authorization of Agreement. This Agreement has been duly
--------------------------
authorized, executed and delivered by the Company.
(xi) Absence of Defaults and Conflicts. Neither the Company nor any
---------------------------------
of its subsidiaries is in violation of its charter or bylaws or in default
in the performance or observance of any obligation, agreement, covenant or
condition contained in any contract, indenture, mortgage, deed of trust,
loan or credit agreement, note, lease or other agreement or instrument to
which the Company or any of its subsidiaries is a party or by which it or
any of them may be bound, or to which any of the property or assets of the
Company or any subsidiary is subject (collectively, "Agreements and
Instruments") except for such defaults that would not result in a Material
Adverse Effect; and the execution, delivery and performance of this
Agreement and the consummation of the transactions contemplated herein and
compliance by the Company with its obligations hereunder have been duly
authorized by all necessary corporate action and do not and will not,
whether with or without the giving of notice or passage of time or both,
conflict with or constitute a breach of, or default or Repayment Event (as
defined below) under, or result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the Company or any
subsidiary pursuant to, the Agreements and Instruments (except for such
conflicts, breaches or defaults or liens, charges or encumbrances that
would not result in a Material Adverse Effect), nor will such action result
in any violation of the provisions of the charter or bylaws of the Company
or any subsidiary or, to the best of the Company's knowledge, any
applicable law, statute, rule, regulation, judgment, order, writ or decree
of any government, government instrumentality or court, domestic or
foreign, having jurisdiction over the Company or any subsidiary or any of
their assets, properties or operations. As used herein, a "Repayment
Event" means any event or condition which gives the holder of any note,
debenture or other evidence of indebtedness of the Company or any
subsidiary (or any person acting on such holder's behalf) the right to
require the repurchase, redemption or repayment of all or a portion of such
indebtedness by the Company or any subsidiary.
6
(xii) Absence of Labor Dispute. No labor dispute with the employees
------------------------
of the Company or any subsidiary exists or, to the knowledge of the
Company, is imminent, and the Company is not aware of any existing or
imminent labor disturbance by the employees of any of its or any
subsidiary's principal suppliers, manufacturers, customers or contractors,
which, in either case, may reasonably be expected to result in a Material
Adverse Effect.
(xiii) Absence of Proceedings. There is no action, suit, proceeding,
----------------------
inquiry or investigation before or brought by any court or governmental
agency or body, domestic or foreign, now pending, or, to the knowledge of
the Company, threatened, against or affecting the Company or any
subsidiary, which is required to be disclosed in the IMC Registration
Statement (other than as disclosed therein), or which might, individually
or in the aggregate, reasonably be expected to result in a Material Adverse
Effect, or which might, individually or in the aggregate, reasonably be
expected to materially and adversely affect the properties or assets
thereof or the performance by the Company of its obligations hereunder; the
aggregate of all pending legal or governmental proceedings to which the
Company or any subsidiary is a party or of which any of their respective
property or assets is the subject which are not described in the IMC
Registration Statement, including ordinary routine litigation incidental to
the business, could not reasonably be expected to result in a Material
Adverse Effect.
(xiv) Accuracy of Exhibits. There are no contracts or documents
--------------------
which are required to be described in the IMC Registration Statement, the
IMC Prospectus or the documents incorporated by reference therein or to be
filed as exhibits thereto which have not been so described or filed as
required.
(xv) Possession of Intellectual Property. The Company and its
-----------------------------------
subsidiaries own or possess, or can acquire on reasonable terms, adequate
patents, patent rights, licenses, inventions, copyrights, know-how
(including trade secrets and other unpatented and/or unpatentable
proprietary or confidential information, systems or procedures),
trademarks, service marks, trade names or other intellectual property
(collectively, "Intellectual Property") necessary to carry on the business
now operated by them, and neither the Company nor any of its subsidiaries
has received any notice or is otherwise aware of any infringement of or
conflict with asserted rights of others with respect to any Intellectual
Property or of any facts or circumstances which would render any
Intellectual Property invalid or inadequate to protect the interest of the
Company or any of its subsidiaries therein, and which infringement or
conflict (if the subject of any unfavorable decision, ruling or finding) or
invalidity or inadequacy, singly or in the aggregate, would result in a
Material Adverse Effect.
(xvi) Absence of Further Requirements. No filing with, or
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authorization, approval, consent, license, order, registration,
qualification or decree of, any court or governmental authority or agency
is necessary or required for the performance by the Company of its
obligations hereunder, except such as has been already obtained or as may
be required under the 1933 Act or the 1933 Act Regulations or state
securities laws.
7
(xvii) Possession of Licenses and Permits. The Company and its
----------------------------------
subsidiaries possess such permits, licenses, approvals, consents and other
authorizations (collectively, "Governmental Licenses") issued by the
appropriate federal, state, local or foreign regulatory agencies or bodies
necessary to conduct the business now operated by them; the Company and its
subsidiaries are in compliance with the terms and conditions of all such
Governmental Licenses, except where the failure so to comply would not,
singly or in the aggregate, have a Material Adverse Effect; all of the
Governmental Licenses are valid and in full force and effect, except when
the invalidity of such Governmental Licenses or the failure of such
Governmental Licenses to be in full force and effect would not have a
Material Adverse Effect; and neither the Company nor any of its
subsidiaries has received any notice of proceedings relating to the
revocation or modification of any such Governmental Licenses which, singly
or in the aggregate, if the subject of an unfavorable decision, ruling or
finding, would result in a Material Adverse Effect.
(xviii) Title to Property. The Company and its subsidiaries have
-----------------
good and marketable title to all material real property owned by the
Company and its subsidiaries and good title to all material personal
property owned by them, in each case, free and clear of all mortgages,
pledges, liens, security interests, claims, restrictions or encumbrances of
any kind except such as (a) are described in the IMC Prospectus or (b) do
not, singly or in the aggregate, materially affect the value of such
property and do not materially interfere with the use made and proposed to
be made of such property by the Company or any of its subsidiaries; and all
of the leases and subleases material to the business of the Company and its
subsidiaries, considered as one enterprise, and under which the Company or
any of its subsidiaries holds properties described in the IMC Prospectus,
are in full force and effect, and neither the Company nor any subsidiary
has any notice of any material claim of any sort that has been asserted by
anyone adverse to the rights of the Company or any subsidiary under any of
the leases or subleases mentioned above, or affecting or questioning the
rights of the Company or such subsidiary to the continued possession of the
leased or subleased premises under any such lease or sublease.
(xix) Compliance with Cuba Act. The Company has complied with, and
------------------------
is and will be in compliance with, the provisions of that certain Florida
act relating to disclosure of doing business with Cuba, codified as Section
517.075 of the Florida statutes, and the rules and regulations thereunder
(collectively, the "Cuba Act") or is exempt therefrom.
(xx) Investment Company Act. 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.
(xxi) Environmental Laws. Except as described in the IMC
------------------
Registration Statement and except as would not, singly or in the aggregate,
result in a Material Adverse Effect, (A) neither the Company nor any of its
subsidiaries is in violation of any federal, state, local or foreign
statute, law, rule, regulation, ordinance, code, policy or rule of common
law or any judicial or administrative interpretation thereof, including any
8
judicial or administrative order, consent, decree or judgment, relating to
pollution or protection of human health, the environment (including,
without limitation, ambient air, surface water, groundwater, land surface
or subsurface strata) or wildlife, including, without limitation, laws and
regulations relating to the release or threatened release of
chemicals, pollutants, contaminants, wastes, toxic substances, hazardous
substances, petroleum or petroleum products (collectively, "Hazardous
Materials") or to the manufacture, processing, distribution, use,
treatment, storage, disposal, transport or handling of Hazardous Materials
(collectively, "Environmental Laws"), (B) the Company and its subsidiaries
have all permits, authorizations and approvals required under any
applicable Environmental Laws and are each in compliance with their
requirements, (C) there are no pending or threatened administrative,
regulatory or judicial actions, suits, demands, demand letters, claims,
liens, notices of noncompliance or violation, investigation or proceedings
relating to any Environmental Law against the Company or any of its
subsidiaries and (D) there are no events or circumstances that might
reasonably be expected to form the basis of an order for clean-up or
remediation, or an action, suit or proceeding by any private party or
governmental body or agency, against or affecting the Company or any of its
subsidiaries relating to Hazardous Materials or any Environmental Laws.
(b) Officer's Certificates. Any certificate signed by any officer of the
Company and delivered to the Underwriter or counsel for the Underwriter or to
ML&Co. or counsel for ML&Co. in connection with the offering of the Securities
shall be deemed a representation and warranty by the Company to the Underwriter
and to ML&Co., as the case may be, as to the matters covered thereby.
SECTION 2. Covenants of the Company. The Company covenants with the
------------------------
Underwriter and with ML&Co. as follows:
(a) Compliance with Securities Regulations and Commission Requests. The
Company, subject to Section 2(b), will notify the Underwriter and ML&Co.
immediately, and confirm the notice in writing, (i) when any post-effective
amendment to the IMC Registration Statement shall become effective, or any
supplement to the IMC Prospectus or any amended IMC Prospectus shall have been
filed, (ii) of the receipt of any comments from the Commission, (iii) of any
request by the Commission for any amendment to the IMC Registration Statement or
any amendment or supplement to the IMC Prospectus or for additional information,
and (iv) of the issuance by the Commission of any stop order suspending the
effectiveness of the IMC Registration Statement or of any order preventing or
suspending the use of any IMC preliminary prospectus, or of the suspension of
the qualification of the shares of IMC Common Stock deliverable upon payment and
discharge of the Securities for offering or sale in any jurisdiction, or of the
initiation or threatening of any proceedings for any of such purposes. The
Company will promptly effect the filings necessary pursuant to Rule 424(b) and
will take such steps as it deems necessary to ascertain promptly whether the
form of prospectus transmitted for filing under Rule 424(b) was received for
filing by the Commission and, in the event that it was not, it will promptly
file such prospectus. The Company will make every reasonable effort to prevent
the issuance of any stop order and, if any stop order is issued, to obtain the
lifting thereof at the earliest possible moment.
9
(b) Filing of Amendments. The Company will give the Underwriter and ML&Co.
notice of its intention to file or prepare any amendment to the IMC Registration
Statement (including any filing under Rule 462(b)) or any amendment, supplement
or revision to either the prospectus included in the IMC Registration Statement
at the time it became effective or to the IMC Prospectus, whether pursuant to
the 1933 Act, the 1934 Act or otherwise, will furnish the Underwriter and ML&Co.
with copies of any such documents a reasonable amount of time prior to such
proposed filing or use, as the case may be, and will not file or use any such
document to which the Underwriter or counsel for the Underwriter or ML&Co. or
counsel for ML&Co. shall reasonably object.
(c) Delivery of IMC Registration Statements. The Company has furnished or
will deliver to the Underwriter, counsel for the Underwriter, ML&Co. and counsel
for ML&Co., without charge, signed copies of the IMC Registration Statement as
originally filed and of each amendment thereto (including exhibits filed
therewith or incorporated by reference therein and documents incorporated or
deemed to be incorporated by reference therein) and signed copies of all
consents and certificates of experts. If applicable, the copies of the IMC
Registration Statement and each amendment thereto furnished to the Underwriter
and ML&Co. will be identical to the electronically transmitted copies thereof
filed with the Commission pursuant to EDGAR, except to the extent permitted by
Regulation S-T.
(d) Delivery of IMC Prospectuses. The Company has delivered to the
Underwriter, without charge, as many copies of each IMC preliminary prospectus
as the Underwriter reasonably requested, and the Company hereby consents to the
use of such copies for purposes permitted by the 1933 Act. The Company will
furnish to the Underwriter, without charge, during the period when the IMC
Prospectus is required to be delivered under the 1933 Act or the 1934 Act, such
number of copies of the IMC Prospectus (as amended or supplemented) as the
Underwriter may reasonably request. If applicable, the IMC Prospectus and any
amendments or supplements thereto furnished to the Underwriter and ML&Co. will
be identical to the electronically transmitted copies thereof filed with the
Commission pursuant to EDGAR, except to the extent permitted by Regulation S-T.
(e) Continued Compliance with Securities Laws. The Company will comply
with the 1933 Act and the 1933 Act Regulations so as to permit the completion of
the distribution of the Securities as contemplated in the Underwriting
Agreement. If at any time when a prospectus is required by the 1933 Act to be
delivered in connection with sales of the Securities, any event shall occur or
condition shall exist as a result of which it is necessary, in the opinion of
counsel for the Underwriter, counsel for ML&Co. or counsel for the Company, to
amend the IMC Registration Statement or amend or supplement the IMC Prospectus
in order that the IMC Prospectus will not include any untrue statements of a
material fact or omit to state a material fact necessary in order to make the
statements therein not misleading in the light of the circumstances existing at
the time it is delivered to a purchaser, or if it shall be necessary, in the
opinion of any such counsel, at any such time to amend the IMC Registration
Statement or amend or supplement the IMC Prospectus in order to comply with the
requirements of the 1933 Act or the 1933 Act Regulations, the Company will
promptly prepare and file with the Commission, subject to Section 2(b), such
amendment or supplement as may be necessary to correct such statement or
omission or to make the IMC Registration Statement or the IMC
10
Prospectus comply with such requirements, and the Company will furnish to the
Underwriter and ML&Co. such number of copies of such amendment or supplement as
the Underwriter and ML&Co. may reasonably request.
(f) Blue Sky Qualifications. The Company will use its best efforts, in
cooperation with the Underwriter, to qualify the shares of IMC Common Stock
deliverable upon payment and discharge of the Securities for offering and sale
under the applicable securities laws of such states and other jurisdictions of
the United States as the Underwriter may designate and to maintain such
qualifications in effect through the maturity date of the Securities; provided,
however, that the Company shall not be obligated to file any general consent to
service of process or to qualify as a foreign corporation or as a dealer in
securities in any jurisdiction in which it is not so qualified or to subject
itself to taxation in respect of doing business in any jurisdiction in which it
is not otherwise so subject. In each jurisdiction in which the shares of IMC
Common Stock deliverable upon payment and discharge of the Securities have been
so qualified, the Company will file such statements and reports as may be
required by the laws of such jurisdiction to continue such qualification in
effect through the maturity date of the Securities.
(g) Rule 158. The Company will timely file such reports pursuant to the
1934 Act as are necessary in order to make generally available to its
securityholders as soon as practicable an earnings statement for the purposes
of, and to provide the benefits contemplated by, the last paragraph of Section
11(a) of the 1933 Act.
(h) Restriction on Sale of Securities by the Company. During a period of
90 days from the date of the IMC Prospectus, the Company will not, without the
prior written consent of the Underwriter, (x) offer, sell, contract to sell or
otherwise dispose of, directly or indirectly, any shares of IMC Common Stock,
securities convertible into, exchangeable for or repayable with shares of IMC
Common Stock, or rights or warrants to acquire shares of IMC Common Stock or (y)
file any registration statement under the 1933 Act with respect to any shares of
IMC Common Stock, securities convertible into, exchangeable for or repayable
with shares of IMC Common Stock, or rights or warrants to acquire shares of IMC
Common Stock; provided, however, that nothing contained in this subsection (h)
shall restrict or otherwise limit the Company from (i) calling for redemption in
accordance with their terms any securities convertible into IMC Common Stock,
(ii) issuing shares upon the exercise of employee or director stock options
outstanding at the date of this Agreement, (iii) issuing shares upon the
exercise of rights granted as of the date of this Agreement under the Company's
shareholders' rights plan, (iv) issuing shares in connection with acquisitions
of privately-held companies, provided that the number of shares so issued does
--------
not exceed, in the aggregate, 2,500,000 (subject to appropriate adjustment for
stock splits, reverse stock splits and stock dividends) and that upon issuance
all such shares constitute "restricted securities" as defined in Rule 144(a)
under the 1933 Act, or (v) offering shares in connection with any registration
statement on Form S-8.
(i) Restriction on Sale of Securities by Directors. The Company will use
its best efforts to ensure that, during a period of 90 days from the date of the
IMC Prospectus, no director of the Company shall, without the prior written
consent of the Underwriter, offer, sell,
11
contract to sell or otherwise dispose of, directly or indirectly, any shares of
IMC Common Stock or any securities convertible into, exchangeable for or
repayable with shares of IMC Common Stock, whether now owned or hereafter
acquired by such director or with respect to which such director has or
hereafter acquires the power of disposition, or cause to be filed any
registration statement under the 1933 Act with respect to any of the foregoing;
provided that, notwithstanding the foregoing, during such 90-day period each
director of the Company may sell, without the prior written consent of the
Underwriter, the greater of (i) 25,000 shares of IMC Common Stock and (ii) 25%
of the total number of shares of IMC Common Stock which such director either
owns or has the power of disposition as of the date of this Agreement.
(j) Reporting Requirements. The Company, during the period when the IMC
Prospectus is required to be delivered under the 1933 Act or the 1934 Act, will
file all documents required to be filed with the Commission pursuant to the 1934
Act within the time periods required by the 1934 Act and the rules and
regulations of the Commission thereunder.
SECTION 3. Payment of Expenses. (a) Expenses. The Company will pay all
-------------------
expenses incident to the performance of its obligations under this Agreement,
including (i) the preparation, printing and filing of the IMC Registration
Statement (including financial statements and exhibits) as originally filed and
of each amendment thereto, (ii) the fees and disbursements of the Company's
counsel, accountants and other advisors, (iii) the qualification of the shares
of IMC Common Stock deliverable upon payment and discharge of the Securities
under securities laws in accordance with the provisions of Section 2(f) hereof,
including filing fees and the reasonable fees and disbursements of counsel for
ML&Co. in connection therewith and in connection with the preparation of the
Blue Sky Survey and any supplement thereto, (iv) the printing and delivery to
the Underwriter of copies of each IMC Preliminary Prospectus and of the IMC
Prospectus and any amendments or supplements thereto, (v) the preparation,
printing and delivery to the Underwriter of copies of the Blue Sky Survey and
any supplement thereto and (vi) the filing fees incident to, and the reasonable
fees and disbursements of counsel to the Underwriter in connection with, the
review by the National Association of Securities Dealers, Inc. of the terms of
the offering and sale of the shares of IMC Common Stock deliverable upon payment
and discharge of the Securities.
SECTION 4. Indemnification.
---------------
(a) Indemnification of Underwriter and ML&Co. The Company agrees to
indemnify and hold harmless (1) the Underwriter and each person, if any, who
controls the Underwriter within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act and (2) ML&Co. and each person, if any, who controls
ML&Co. within the meaning of Section 15 of the 1933 Act or Section 20 of the
1934 Act, as follows:
(i) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, arising out of any untrue statement or alleged
untrue statement of a material fact contained in the IMC Registration
Statement (or any amendment thereto) or the omission or alleged omission
therefrom of a material fact required to be stated therein or necessary to
make the statements therein not misleading or arising out of any untrue
statement or alleged untrue statement of a material fact contained in any
12
IMC preliminary prospectus or the IMC Prospectus (or any amendment or
supplement thereto), or the omission or alleged omission therefrom of a
material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading;
(ii) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, to the extent of the aggregate amount paid in
settlement of any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or of any claim
whatsoever based upon any such untrue statement or omission, or any such
alleged untrue statement or omission, referred to under (i) above; provided
that (subject to Section 4(d) below) any such settlement is effected with
the written consent of the Company; and
(iii) against any and all expense whatsoever, as incurred (including
the fees and disbursements of counsel chosen by the Underwriter or ML&Co.,
as the case may be), reasonably incurred 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 statement or omission, or any such
alleged untrue statement or omission, referred to under (i) above, to the
extent that any such expense is not paid under (i) or (ii) above;
provided, however, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Company by the
Underwriter, ML&Co. or GVI expressly for use in the IMC Registration Statement
(or any amendment thereto), or any IMC preliminary prospectus or the IMC
Prospectus (or any amendment or supplement thereto).
(b) Indemnification of Company, Directors, Officers. The Underwriter
agrees to indemnify and hold harmless the Company, its directors, each of its
officers who signed the IMC Registration Statement, and each person, if any, who
controls the Company within the meaning of Section 15 of the 1933 Act or Section
20 of the 1934 Act against any and all loss, liability, claim, damage and
expense described in the indemnity contained in subsection (a) of this Section,
as incurred, but only with respect to untrue statements or omissions, or alleged
untrue statements or omissions, made in the IMC Registration Statement (or any
amendment thereto), or any IMC preliminary prospectus or the IMC Prospectus (or
any amendment or supplement thereto) in reliance upon and in conformity with
written information furnished to the Company by the Underwriter expressly for
use in the IMC Registration Statement (or any amendment thereto) or such IMC
preliminary prospectus or the IMC Prospectus (or any amendment or supplement
thereto).
(c) Actions against Parties; Notification. Each indemnified party shall
give notice as promptly as reasonably practicable to each indemnifying party of
any action commenced against it in respect of which indemnity may be sought
hereunder, but failure to so notify an indemnifying party shall not relieve such
indemnifying party from any liability hereunder to the extent it is not
materially prejudiced as a result thereof and in any event shall not relieve it
from
13
any liability which it may have otherwise than on account of this indemnity
agreement. In the case of parties indemnified pursuant to clause (1) of Section
4(a) above, counsel to the indemnified parties shall be selected by the
Underwriter; in the case of parties indemnified pursuant to clause (2) of
Section 4(a), counsel to the indemnified parties shall be selected by ML&Co.;
and, in the case of parties indemnified pursuant to Section 4(b) above, counsel
to the indemnified parties shall be selected by the Company. An indemnifying
party may participate at its own expense in the defense of any such action;
provided, however, that counsel to the indemnifying party shall not (except with
the consent of the indemnified party) also be counsel to the indemnified party.
In no event shall the indemnifying parties be liable for fees and expenses of
more than one counsel (in addition to any local counsel) separate from their own
counsel for all indemnified parties in connection with any one action or
separate but similar or related actions in the same jurisdiction arising out of
the same general allegations or circumstances. No indemnifying party shall,
without the prior written consent of the indemnified parties, settle or
compromise or consent to the entry of any judgment with respect to any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever in respect of which
indemnification or contribution could be sought under this Section 4 or Section
5 hereof (whether or not the indemnified parties are actual or potential parties
thereto), unless such settlement, compromise or consent (i) includes an
unconditional release of each indemnified party from all liability arising out
of such litigation, investigation, proceeding or claim and (ii) does not include
a statement as to or an admission of fault, culpability or a failure to act by
or on behalf of any indemnified party.
(d) Settlement without Consent if Failure to Reimburse. If at any time an
indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel, such indemnifying party
agrees that it shall be liable for any settlement of the nature contemplated by
Section 4(a)(ii) effected without its written consent if (i) such settlement is
entered into more than 45 days after receipt by such indemnifying party of the
aforesaid request, (ii) such indemnifying party shall have received notice of
the terms of such settlement at least 30 days prior to such settlement being
entered into and (iii) such indemnifying party shall not have reimbursed such
indemnified party in accordance with such request prior to the date of such
settlement.
SECTION 5. Contribution. If the indemnification provided for in Section 4
------------
hereof is for any reason unavailable to or insufficient to hold harmless an
indemnified party in respect of any losses, liabilities, claims, damages or
expenses referred to therein, then the Company on the one hand and the
Underwriter and ML&Co. on the other hand shall contribute to the aggregate
amount of such losses, liabilities, claims, damages and expenses incurred by
such indemnified party, as incurred, (i) in such proportion as is appropriate to
reflect the relative benefits received by the Company on the one hand and the
Underwriter and ML&Co. on the other hand from the offering of the Securities or
(ii) if the allocation provided by clause (i) is not permitted by applicable
law, in such proportion as is appropriate to reflect not only the relative
benefits referred to in clause (i) above but also the relative fault of the
Company on the one hand and of the Underwriter and ML&Co. 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.
14
The relative benefits received from the offering of the Securities shall be
deemed to be such that the Underwriter and ML&Co. shall be responsible for that
portion of the aggregate amount of such losses, liabilities, claims, damages and
expenses represented by the percentage that the total underwriting discount
received by the Underwriter, as set forth on the cover of the ML&Co. Prospectus,
or, if Rule 434 is used, the corresponding location on the ML&Co. Term Sheet,
bears to the aggregate initial public offering price of the Securities as set
forth on such cover and the Company shall be responsible for the balance.
The relative fault of the Company on the one hand and the Underwriter and
ML&Co. on the other hand shall be determined by reference to, among other
things, whether any such untrue or alleged untrue statement of a material fact
or omission or alleged omission to state a material fact relates to information
supplied by the Company on the one hand or by the Underwriter or ML&Co. on the
other hand and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission.
Notwithstanding the provisions of this Section 5, the Underwriter and
ML&Co. shall not be required to contribute any amount in excess of the amount by
which the total price at which the Securities underwritten by the Underwriter
and distributed to the public were offered to the public exceeds the amount of
any damages which the Underwriter and ML&Co. have otherwise been required to pay
by reason of any such untrue or alleged untrue statement or omission or alleged
omission.
The Company, the Underwriter and ML&Co. agree that it would not be just and
equitable if contribution pursuant to this Section 5 were determined by pro rata
allocation or by any other method of allocation which does not take account of
the equitable considerations referred to above in this Section 5. The aggregate
amount of losses, liabilities, claims, damages and expenses incurred by an
indemnified party and referred to above in this Section 5 shall be deemed to
include any 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.
No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the 1933 Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 5, each person, if any, who controls an
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act shall have the same rights to contribution as the Underwriter; each
person, if any, who controls ML&Co. within the meaning of Section 15 of the 1933
Act shall have the same rights to contribution as ML&Co.; and each director of
the Company, each officer of the Company who signed the IMC Registration
Statement, and each person, if any, who controls the Company within the meaning
of Section 15 of the 1933 Act or Section 20 of the 1934 Act shall have the same
rights to contribution as the Company.
15
SECTION 6. Representations, Warranties and Agreements to Survive Delivery.
--------------------------------------------------------------
All representations, warranties and agreements contained in this Agreement or in
certificates of officers of the Company submitted pursuant to the Underwriting
Agreement, shall remain operative and in full force and effect, regardless of
any investigation made by or on behalf of the Underwriter or controlling person
thereof, or by or on behalf of ML&Co. or controlling person thereof or by or on
behalf of the Company, and shall survive delivery of the Securities to the
Underwriter pursuant to the Underwriting Agreement.
SECTION 7. Termination. In the event that the Underwriter terminates the
-----------
Underwriting Agreement as provided in Section 9 thereof, this Agreement shall
simultaneously terminate, except that the provisions of Section 3, the indemnity
agreements set forth in Section 4, the contribution provisions set forth in
Section 5, and the provisions of Section 6 shall remain in effect.
SECTION 8. Notices. All notices and other communications hereunder shall
-------
be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the
Underwriter shall be directed to it at Sears Tower Building, Suite 5500,
Chicago, Illinois 60606, attention of Todd Kaplan, Director; notices to ML&Co.
shall be directed to it at 100 Church Street, 12th Floor, New York, New York
10007, attention of the Secretary, with a copy to the Treasurer at World
Financial Tower, South Tower, New York, New York 10080-6105; notices to the
Company shall be directed to it at 2100 Sanders Road, Northbrook, Illinois
60062, attention of Corporate Secretary.
SECTION 9. Parties. This Agreement shall inure to the benefit of and be
-------
binding upon each of the Underwriter, ML&Co. and the Company and their
respective successors. Nothing expressed or mentioned in this Agreement is
intended or shall be construed to give any person, firm or corporation, other
than the Underwriter, ML&Co. and the Company and their respective successors and
the controlling persons and officers and directors referred to in Sections 4 and
5 and their heirs and legal representatives, any legal or equitable right,
remedy or claim under or in respect of this Agreement or any provision herein
contained. This Agreement and all conditions and provisions hereof are intended
to be for the sole and exclusive benefit of the Underwriter, ML&Co. and the
Company and their respective successors, and said controlling persons and
officers and directors and their heirs and legal representatives, and for the
benefit of no other person, firm or corporation. No purchaser of Securities
from the Underwriter shall be deemed to be a successor by reason merely of such
purchase.
SECTION 10. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
-------------
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
SECTION 11. Effect of Headings. The Article and Section headings herein
------------------
and the Table of Contents are for convenience only and shall not affect the
construction hereof.
16
If the foregoing is in accordance with your understanding of our agreement,
please sign and return to the Company a counterpart hereof, whereupon this
instrument, along with all counterparts, will become a binding agreement between
the Underwriter, ML&Co. and the Company in accordance with its terms.
Very truly yours,
IMC GLOBAL INC.
By__________________________________________
Name:
Title:
CONFIRMED AND ACCEPTED,
as of the date first above written:
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
By _______________________________________
Authorized Signatory
MERRILL LYNCH & CO., INC.
By _______________________________________
Name:
Title:
17
SCHEDULE A
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IMC-Agrico Company (a Delaware general partnership)
IMC Global Operations Inc.
Vigoro Industries, Inc.
Kalium Chemicals, Ltd.
IMC Kalium Carlsbad Potash Company