Exhibit 1(c)
MERRILL LYNCH & CO., INC.
(a Delaware corporation)
UNDERWRITING AGREEMENT FOR
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COMMON STOCK, COMMON STOCK WARRANTS,
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PREFERRED STOCK, PREFERRED STOCK WARRANTS
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AND DEPOSITARY SHARES
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Dated: July___, 1998
Table of Contents
Page
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SECTION 1. Representations and Warranties.........................................................................4
(a) Representations and Warranties by the Company...................................................4
(1)Compliance with Registration Requirements.......................................................5
(2) Incorporated Documents..........................................................................5
(3)Independent Accountants.........................................................................6
(4) Financial Statements............................................................................6
(5) No Material Adverse Change in Business..........................................................6
(6) Good Standing of the Company....................................................................6
(7)Good Standing of Subsidiaries...................................................................7
(8) Capitalization..................................................................................7
(9) Authorization of this Underwriting Agreement and Terms Agreement................................7
(10)Authorization of Common Stock...................................................................7
(11)Authorization of Preferred Stock and/or Depositary Shares......................................8
(12)Authorization of Deposit Agreement..............................................................8
(13)Authorization of Warrants.......................................................................9
(14)Authorization of Warrant Agreement..............................................................9
(15)Authorization of Underlying Securities..........................................................9
(16)Authorization of Indentures...................................................................10
(17)Descriptions of the Underwritten Securities, Warrant Agreements,
Deposit Agreements, Indentures and Underlying Securities..........................................10
(18)Absence of Defaults and Conflicts..............................................................10
(19)Absence of Labor Dispute......................................................................11
(20)Absence of Proceedings.........................................................................11
(21)Exhibits......................................................................................12
(22)Absence of Further Requirements................................................................12
(23)Possession of Intellectual Property............................................................12
(24)Possession of Licenses and Permits.............................................................12
(25)Title to Property.............................................................................13
(26)Commodity Exchange Act.........................................................................13
(27)Compliance with Cuba Act.......................................................................13
(b) Officers' Certificates.........................................................................13
SECTION 2. Sale and Delivery to Underwriters; Closing............................................................13
(a) Underwritten Securities........................................................................13
(b) Option Underwritten Securities.................................................................14
(c) Payment........................................................................................14
(d) Denominations; Registration....................................................................15
SECTION 3. Covenants of the Company..............................................................................15
(a) Compliance with Securities Regulations and Commission Requests.................................15
(b) Filing of Amendments...........................................................................16
(c) Delivery of Registration Statements............................................................16
(d) Delivery of Prospectuses.......................................................................16
(e) Continued Compliance with Securities Laws......................................................16
(f) Blue Sky Qualifications........................................................................17
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(g) Earnings Statement.............................................................................17
(h) Reservation of Securities......................................................................17
(i) Use of Proceeds................................................................................17
(j) Listing........................................................................................17
(k) Restriction on Sale of Securities..............................................................17
(l) Reporting Requirements.........................................................................18
SECTION 4. Payment of Expenses...................................................................................18
(a) Expenses.......................................................................................18
(b) Termination of Agreement.......................................................................18
SECTION 5. Conditions of Underwriters' Obligations...............................................................19
(a) Effectiveness of Registration Statement........................................................19
(b) Opinion of Counsel for Company.................................................................19
(c) Opinion of Counsel for Underwriters............................................................19
(d) Officers' Certificate..........................................................................19
(e) Accountant's Comfort Letter....................................................................20
(f) Ratings........................................................................................20
(g) Approval of Listing............................................................................20
(h) No Objection...................................................................................20
(i) Lock-up Agreements.............................................................................20
(j) Over-Allotment Option..........................................................................20
(k) Additional Documents...........................................................................21
(l) Termination of Terms Agreement.................................................................21
SECTION 6. Indemnification.22
(a) Indemnification of Underwriters................................................................22
(b) Indemnification of Company, Directors and Officers.............................................23
(c) Documentary Stamp or Similar Issue Tax Indemnification.........................................23
(d) Actions Against Parties; Notification..........................................................23
(e) Settlement without Consent if Failure to Reimburse.............................................24
SECTION 7. Contribution..........................................................................................24
SECTION 8. Representations, Warranties and Agreements to Survive Delivery........................................25
SECTION 9. Termination...........................................................................................25
(a) Underwriting Agreement.........................................................................25
(b) Terms Agreement................................................................................25
(c) Liabilities....................................................................................26
SECTION 10. Default by One or More of the Underwriters...........................................................26
SECTION 11. Notices..............................................................................................27
SECTION 12. Parties..............................................................................................27
SECTION 13. GOVERNING LAW........................................................................................27
SECTION 14. Effect of Headings...................................................................................28
ii
MERRILL LYNCH & CO., INC.
(a Delaware corporation)
Common Stock, Warrants to Purchase Common Stock,
Preferred Stock, Warrants to Purchase Preferred Stock, and
Depositary Shares
UNDERWRITING AGREEMENT
July ___, 1998
MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
North Tower
World Financial Center
New York, New York 10281-1332
Ladies and Gentlemen:
Merrill Lynch & Co., Inc., a Delaware corporation (the "Company"), proposes
to issue and sell up to $_____________ aggregate initial public offering price
of its (i) shares of common stock, par value $1.33 per share, including any
preferred share purchase Rights attached thereto (the "Common Stock"), (ii)
warrants to purchase shares of Common Stock (the "Common Stock Warrants"), (iii)
shares of preferred stock, par value $1.00 per share (the "Preferred Stock"),
that may be represented by depositary shares (the "Depositary Shares") or (iv)
warrants to purchase shares of Preferred Stock (the "Preferred Stock Warrants")
or any combination thereof, from time to time, in or pursuant to one or more
offerings on terms to be determined at the time of sale. It is understood that
the Company may from time to time authorize the issuance of additional shares of
Common Stock, Preferred Stock, Common Stock Warrants, Preferred Stock Warrants
or Depositary Shares.
The Preferred Stock will be issued in one or more series and each series of
Preferred Stock may vary, as applicable, as to the title, specific number of
shares, rank, stated value, liquidation preference, dividend rate or rates (or
method of calculation), dividend payment dates, redemption provisions, sinking
fund requirements, conversion provisions (and terms of the related Underlying
Securities (as defined below)) and any other variable terms as set forth in the
applicable certificate of designations (each, the "Certificate of Designations")
relating to such series of Preferred Stock. A series of Preferred Stock may be
represented by Depositary Shares that are evidenced by depositary receipts (the
"Depositary Receipts") issued pursuant to a deposit
agreement (each, a "Deposit Agreement") among the Company, the depositary
identified therein (the "Depositary") and the registered holders of the
Depositary Receipts issued thereunder.
Each issue of Common Stock Warrants and Preferred Stock Warrants
(collectively, the "Warrants") will be issued pursuant to a separate warrant
agreement (each, a "Warrant Agreement") between the Company and the warrant
agent identified therein (each, a "Warrant Agent"). The Warrants may vary, as
applicable, as to, among other terms, title, type, specific number, exercise
dates or periods, exercise price(s), expiration date(s) and terms of the related
Underlying Securities.
As used herein, "Securities" shall mean the Common Stock, Common Stock
Warrants, Preferred Stock, Preferred Stock Warrants or Depositary Shares, or any
combination thereof, initially issuable by the Company which may be sold
hereunder and "Underlying Securities" shall mean the Common Stock, Preferred
Stock or Depositary Shares issuable upon exercise of the Warrants, as
applicable, or and any Common Stock, Preferred Stock, Depositary Shares or
senior or subordinated debt securities (the "Debt Securities") issuable upon
conversion or exchange of such Preferred Stock or Depositary Shares, as
applicable.
Unless otherwise specified in the applicable Terms Agreement (as defined
below), if the Underlying Securities include Debt Securities, such Debt
Securities will be issued in one or more series as (i) senior indebtedness (the
"Senior Debt Securities") under (x) an indenture, dated as of April 1, 1983, as
amended and restated (the "1983 Indenture"), between the Company and The Chase
Manhattan Bank, formerly known as Chemical Bank (successor by merger to
Manufacturers Hanover Trust Company), as trustee (the "1983 Trustee"), or (y) an
indenture, dated as of October 1, 1993 (the "1993 Indenture", and together with
the 1983 Indenture, the "Senior Indentures"), between the Company and The Chase
Manhattan Bank (successor by merger to The Chase Manhattan Bank, N.A.), as
trustee (the "1993 Trustee" and, together with the 1983 Trustee, the "Senior
Trustees") or (ii) subordinated indebtedness (the "Subordinated Debt
Securities") under an indenture (the "Subordinated Indenture"), between the
Company and The Chase Manhattan Bank, formerly known as Chemical Bank, as
trustee (the "Subordinated Trustee"). The Senior Debt Securities and the
Subordinated Debt Securities may also be issued under one or more other
indentures (each, a "Subsequent Indenture") and have one or more other trustees
(each, a "Subsequent Trustee"). Any Subsequent Indenture relating to Senior
Debt Securities or Subordinated Debt Securities will have terms and conditions
identical in all material respects to the above-referenced Senior Indentures or
the Subordinated Indenture, as the case may be. Each series of Debt Securities
may vary, as applicable, as to title, aggregate principal amount, rank, interest
rate or formula and timing of payments thereof, stated maturity date, redemption
and/or repayment provisions, sinking fund requirements, conversion provisions
(and terms of the securities issuable upon conversion) and any other variable
terms established by, or pursuant to, the applicable Indenture. Additionally,
the Company may issue Subordinated Debt Securities under a separate indenture
which provides for a single issue of zero coupon convertible Subordinated Debt
Securities.
Whenever the Company determines to make an offering of Securities through
Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated
("Merrill Lynch"), or through an underwriting syndicate managed by Merrill
Lynch, the Company will enter into an agreement
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(each, a "Terms Agreement") providing for the sale of such Securities to, and
the purchase and offering thereof by, Merrill Lynch and such other underwriters,
if any, selected by Merrill Lynch (the "Underwriters", which term shall include
Merrill Lynch, whether acting as sole Underwriter or as a member of an
underwriting syndicate, as well as any Underwriter substituted pursuant to
Section 10 hereof). The Terms Agreement relating to the offering of Securities
shall specify the number of Securities to be initially issued (the "Initial
Underwritten Securities"), the name of each Underwriter participating in such
offering (subject to substitution as provided in Section 10 hereof) and the name
of any Underwriter other than Merrill Lynch acting as co-manager in connection
with such offering, the number of Initial Underwritten Securities which each
such Underwriter severally agrees to purchase, whether such offering is on a
fixed or variable price basis and, if on a fixed price basis, the initial
offering price, the price at which the Initial Underwritten Securities are to be
purchased by the Underwriters, the form, time, date and place of delivery and
payment of the Initial Underwritten Securities and any other material variable
terms of the Initial Underwritten Securities, as well as the material variable
terms of any related Underlying Securities. In addition, if applicable, such
Terms Agreement shall specify whether the Company has agreed to grant to the
Underwriters an option to purchase additional Securities to cover over-
allotments, if any, and the number of Securities subject to such option (the
"Option Underwritten Securities"). As used herein, the term "Underwritten
Securities" shall include the Initial Underwritten Securities and all or any
portion of any Option Underwritten Securities. The Terms Agreement, which shall
be substantially in the form of Exhibit A hereto, may take the form of an
exchange of any standard form of written telecommunication between the Company
and Merrill Lynch, acting for itself and, if applicable, as representative of
any other Underwriters. Each offering of Underwritten Securities through Merrill
Lynch as sole Underwriter or through an underwriting syndicate managed by
Merrill Lynch will be governed by this Underwriting Agreement, as supplemented
by the applicable Terms Agreement.
The Company has filed with the Securities and Exchange Commission (the
"Commission") two registration statements on Form S-3 (No. 333-44173 and pre-
effective amendment No. 1 thereto and No. 333-________ [and pre-effective
amendment No. 1 thereto]) (the "Initial Registration Statements") for the
registration of the Securities and the Underlying Securities under the
Securities Act of 1933, as amended (the "1933 Act"), and the offering thereof
from time to time in accordance with Rule 415 of the rules and regulations of
the Commission under the 1933 Act (the "1933 Act Regulations"). The Initial
Registration Statements have been declared effective by the Commission, and each
Indenture in effect as of the date of this Underwriting Agreement has been duly
qualified under the Trust Indenture Act of 1939, as amended (the "1939 Act").
The Company will have filed such post-effective amendments to the Initial
Registration Statements as may be required, and any applicable Indenture will
have been duly qualified under the 1939 Act, prior to the execution of the
applicable Terms Agreement. The Initial Registration Statement (as so amended,
if applicable), including the information, if any, deemed to be a part thereof
pursuant to Rule 430A(b) of the 1933 Act Regulations (the "Rule 430A
Information") or Rule 434(d) of the 1933 Act Regulations (the "Rule 434
Information"), are referred to herein as the "Registration Statement"; and the
final prospectus and the final prospectus supplement relating to the offering of
the Underwritten Securities, in the form first furnished to the Underwriters by
the Company for use in connection with the offering of the Underwritten
Securities, are collectively referred to herein as the "Prospectus"; provided,
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however, that all references to the "Registration Statement" and
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the "Prospectus" shall also be deemed to include all documents incorporated
therein by reference which have been filed pursuant to the Securities Exchange
Act of 1934, as amended (the "1934 Act"), prior to the execution of the
applicable Terms Agreement; provided, further, that if the Company (i) files a
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registration statement with the Commission pursuant to Rule 462(b) of the 1933
Act Regulations (the "Rule 462 Registration Statement"), then, after such
filing, all references to "Registration Statement" shall thereafter also be
deemed to include the Rule 462 Registration Statement; (ii) files a registration
statement or registration statements with the Commission registering additional
securities under the 1933 Act which securities may be issued and sold pursuant
to the terms of this Underwriting Agreement (each, a "Subsequent Registration
Statement"), then after effectiveness of such Subsequent Registration Statement,
all references to "Registration Statement" shall thereafter be deemed to refer
to the Initial Registration Statement and/or the Subsequent Registration
Statement (each as so amended, if applicable, and including any Rule 430A
Information, Rule 434 Information or Rule 462 Registration Statement), as the
case may be; and (iii) elects to rely upon Rule 434 of the 1933 Act Regulations,
then all references to "Prospectus" shall also be deemed to include the final or
preliminary prospectus and the applicable term sheet or abbreviated term sheet
(the "Term Sheet"), as the case may be, in the form first furnished to the
Underwriters by the Company in reliance upon Rule 434 of the 1933 Act
Regulations, and all references in this Underwriting Agreement to the date of
the Prospectus shall mean the date of the Term Sheet. The term "preliminary
prospectus" shall mean any prospectus used before the registration statement
became effective and any prospectus that omitted, as applicable, the Rule 430A
Information, the Rule 434 Information or other information to be included upon
pricing in a form of prospectus filed with the Commission pursuant to Rule
424(b) of the 1933 Act Regulations, that was used after such effectiveness and
prior to the execution and delivery of the applicable Terms Agreement. For
purposes of this Underwriting Agreement, all references to the Registration
Statement, Prospectus, Term Sheet or preliminary prospectus or to any amendment
or supplement to any of the foregoing shall be deemed to include any copy filed
with the Commission pursuant to its Electronic Data Gathering, Analysis and
Retrieval system ("EDGAR").
All references in this Underwriting Agreement to financial statements and
schedules and other information which is "contained," "included" or "stated" (or
other references of like import) in the Registration Statement, Prospectus or
preliminary prospectus shall be deemed to mean and include all such financial
statements and schedules and other information which is incorporated by
reference in the Registration Statement, Prospectus or preliminary prospectus,
as the case may be; and all references in this Underwriting Agreement to
amendments or supplements to the Registration Statement, Prospectus or
preliminary prospectus shall be deemed to mean and include the filing of any
document under the 1934 Act which is incorporated by reference in the
Registration Statement, Prospectus or preliminary prospectus, as the case may
be.
SECTION 1. Representations and Warranties.
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(a) Representations and Warranties by the Company. The Company
represents and warrants to Merrill Lynch, as of the date hereof, and to each
Underwriter named in the applicable Terms Agreement, as of the date thereof, as
of the Closing Time (as defined below) and, if
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applicable, as of each Date of Delivery (as defined below) (in each case, a
"Representation Date"), as follows:
(1) Compliance with Registration Requirements. The Company meets the
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requirements for use of Form S-3 under the 1933 Act. The Registration
Statement has become effective under the 1933 Act and no stop order
suspending the effectiveness of the 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. In addition, each Indenture in effect
as of each Representation Date has been duly qualified under the 1939 Act.
At the respective times the Registration Statement and any post-
effective amendments thereto (including the filing of the Company's most
recent Annual Report on Form 10-K with the Commission (the "Annual Report
on Form 10-K")) became effective and at each Representation Date, the
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 the 1939 Act and the rules and
regulations of the Commission under the 1939 Act (the "1939 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. At the
date of the Prospectus, at the Closing Time and at each Date of Delivery,
if any, the Prospectus and any amendments and supplements thereto did not
and will not include an untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not misleading.
If Rule 434 is used, the Company will comply with the requirements of Rule
434. The representations and warranties in this subsection shall not apply
to (A) statements in or omissions from the Registration Statement or the
Prospectus made in reliance upon and in conformity with information
furnished to the Company in writing by any Underwriter through Merrill
Lynch expressly for use in the Registration Statement or the Prospectus or
(B) that part of the Registration Statement that constitutes the Statement
of Eligibility on Form T-1 (the "Form T-1") under the 1939 Act of the
relevant Trustee.
Each preliminary prospectus and prospectus filed as part of the
Registration Statement as originally filed or as part of any amendment
thereto, or filed pursuant to Rule 424 under the 1933 Act, complied when so
filed in all material respects with the 1933 Act Regulations and each
preliminary prospectus and the Prospectus delivered to the Underwriters for
use in connection with the offering of Underwritten Securities will, at the
time of such delivery, be identical to any electronically transmitted
copies thereof filed with the Commission pursuant to EDGAR, except to the
extent permitted by Regulation S-T.
(2) Incorporated Documents. The documents incorporated or deemed to be
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incorporated by reference in the Registration Statement and the 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
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and the rules and regulations of the Commission thereunder (the "1934 Act
Regulations") and, when read together with the other information in the
Prospectus, at the date of the Prospectus, at the Closing Time and at each
Date of Delivery, if any, did not and will not include an untrue statement
of a material fact or omit to state a material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading.
(3) Independent Accountants. The accountants who certified the
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financial statements and any supporting schedules thereto included in the
Registration Statement and the Prospectus are independent public
accountants as required by the 1933 Act and the 1933 Act Regulations.
(4) Financial Statements. The financial statements of the Company
--------------------
included in the Registration Statement and the Prospectus, together with
the related schedules and notes, as well as those financial statements,
schedules and notes of any other entity included therein, present fairly
the financial position of the Company and its consolidated subsidiaries, or
such other entity, as the case may be, at the dates indicated and the
statement of operations, stockholders' equity and cash flows of the Company
and its consolidated subsidiaries, or such other entity, as the case may
be, for the periods specified. Such financial statements have been prepared
in conformity with generally accepted accounting principles ("GAAP")
applied on a consistent basis throughout the periods involved. The
supporting schedules, if any, included in the Registration Statement
present fairly in accordance with GAAP the information required to be
stated therein. The selected financial data and the summary financial
information, if any, included in the Registration Statement or the
Prospectus present fairly the information shown therein and have been
compiled on a basis consistent with that of the audited financial
statements incorporated by reference or included in the Registration
Statement and the Prospectus.
(5) No Material Adverse Change in Business. Since the respective
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dates as of which information is given in the Registration Statement and
the Prospectus, except as otherwise stated therein, (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, other than those arising in the ordinary course of business,
which are material with respect to the Company and its subsidiaries
considered as one enterprise and (C) except for regular quarterly dividends
on the Company's outstanding common stock and regular dividends on its
outstanding preferred stock in amounts per share that are consistent with
the terms of such preferred 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.
(6) Good Standing of the Company. The Company has been duly organized
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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
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and to conduct its business as described in the Prospectus and to enter
into and perform its obligations under, or as contemplated under, this
Underwriting Agreement and the applicable Terms Agreement. 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 to so qualify or be in good
standing would not result in a Material Adverse Effect.
(7) Good Standing of Subsidiaries. Each subsidiary of the Company
-----------------------------
which is a "significant subsidiary" as defined in Regulation S-X under the
1933 Act (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 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 to so qualify or be in good standing
would not result in a Material Adverse Effect; except as otherwise
disclosed in the Registration Statement and Prospectus, all of the issued
and outstanding capital stock of each Subsidiary has been duly authorized
and validly issued and is fully paid and non-assessable and is owned by the
Company, directly or through subsidiaries, free and clear of any security
interest, mortgage, pledge, lien, encumbrance, claim or equity; and none of
the outstanding shares of capital stock of any Subsidiary was issued in
violation of preemptive or similar rights of any security holder of such
Subsidiary. The only subsidiaries of the Company are (A) the subsidiaries
listed in Exhibit 21 to the Annual Report on Form 10-K of the Company filed
with the Commission under Section 13 of the 1934 Act 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 under the 1933 Act.
(8) Capitalization. If the Prospectus contains a "Capitalization"
--------------
section, the authorized, issued and outstanding shares of capital stock of
the Company is as set forth therein (except for subsequent issuances
thereof, if any, contemplated under this Underwriting Agreement, pursuant
to 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). Such shares of capital stock have been duly
authorized and validly issued by the Company and are fully paid and non-
assessable, and none of such shares of capital stock was issued in
violation of preemptive or similar rights of any securityholder of the
Company.
(9) Authorization of this Underwriting Agreement and Terms Agreement.
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This Underwriting Agreement has been, and the applicable Terms Agreement as
of the date thereof will have been, duly authorized, executed and delivered
by the Company.
(10) Authorization of Common Stock. If the Underwritten Securities
-----------------------------
being sold pursuant to the applicable Terms Agreement include Common Stock,
such Underwritten
7
Securities have been, or as of the date of such Terms Agreement will have
been, duly authorized by the Company for issuance and sale pursuant to this
Underwriting Agreement and such Terms Agreement. Such Underwritten
Securities, when issued and delivered by the Company pursuant to this
Underwriting Agreement and such Terms Agreement against payment of the
consideration therefor specified in such Terms Agreement, will be validly
issued, fully paid and non-assessable and will not be subject to preemptive
or similar rights of any securityholder of the Company. No holder of such
Underwritten Securities is or will be subject to personal liability by
reason of being such a holder.
(11) Authorization of Preferred Stock and/or Depositary Shares. If the
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Underwritten Securities being sold pursuant to the applicable Terms
Agreement include Preferred Stock and/or Depositary Shares, such
Underwritten Securities have been, or as of the date of such Terms
Agreement will have been, duly authorized by the Company for issuance and
sale pursuant to this Underwriting Agreement and such Terms Agreement. The
applicable Preferred Stock, when issued and delivered by the Company
pursuant to this Underwriting Agreement and such Terms Agreement against
payment of the consideration therefor, or for the related Depositary
Shares, as the case may be, specified in such Terms Agreement, will be
validly issued, fully paid and non-assessable and will not be subject to
preemptive or similar rights of any securityholder of the Company. In
addition, upon deposit by the Company of any Preferred Stock represented by
Depositary Shares with the applicable Depositary and the execution and
delivery by such Depositary of the Depositary Receipts evidencing such
Depositary Shares, in each case pursuant to the applicable Deposit
Agreement, such Depositary Shares will represent legal and valid interests
in such Preferred Stock. No holder of such Preferred Stock or Depositary
Receipts evidencing Depositary Shares is or will be subject to personal
liability by reason of being such a holder. The applicable Certificate of
Designations will be in full force and effect prior to the Closing Time.
(12) Authorization of Deposit Agreement. If the Underwritten
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Securities being sold pursuant to the applicable Terms Agreement include
Depositary Shares, the applicable Deposit Agreement has been, or prior to
the issuance of such Depositary Shares will have been, duly authorized,
executed and delivered by the Company and, upon such authorization,
execution and delivery (assuming due authorization, execution and delivery
by the applicable Depositary), will constitute a valid and legally binding
agreement of the Company, enforceable against the Company in accordance
with its terms, except as the enforcement thereof may be limited by
bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting creditors' rights generally and except as enforcement thereof is
subject to general principles of equity (regardless of whether enforcement
is considered in a proceeding in equity or at law). Each registered holder
of a Depositary Receipt under the applicable Deposit Agreement will be
entitled to the proportional rights, preferences and limitations of the
Preferred Stock represented by the Depositary Shares evidenced by such
Depositary Receipt and to such other rights as are granted to such
registered holder in such Deposit Agreement.
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(13) Authorization of Warrants. If the Underwritten Securities being
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sold ursuant to the applicable Terms Agreement include Warrants, such
Underwritten Securities have been, or prior to issuance of such
Underwritten Securities will have been, duly authorized by the Company for
issuance and sale pursuant to this Underwriting Agreement and such Terms
Agreement. Such Underwritten Securities, when issued and authenticated in
the manner provided for the applicable Warrant Agreement and delivered
against payment of the consideration therefor specified in such Terms
Agreement, will constitute valid and legally binding obligations of the
Company, entitled to the benefits provided by such Warrant Agreement and
enforceable against the Company in accordance with their terms, except as
the enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditors' rights
generally and except as enforcement thereof is subject to general
principles of equity (regardless of whether enforcement is considered in a
proceeding in equity or at law).
(14) Authorization of Warrant Agreement. If the Underwritten
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Securities being sold pursuant to the applicable Terms Agreement include
Warrants, each applicable Warrant Agreement has been, or prior to the
issuance of such Underwritten Securities will have been, duly authorized,
executed and delivered by the Company and, upon such authorization,
execution and delivery (assuming due authorization, execution and delivery
by the applicable Warrant Agent), will constitute a valid and legally
binding agreement of the Company, enforceable against the Company in
accordance with its terms, except as the enforcement thereof may be limited
by bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting creditors' rights generally and except as enforcement thereof is
subject to general principles of equity (regardless of whether enforcement
is considered in a proceeding in equity or at law).
(15) Authorization of Underlying Securities. If the Underlying
--------------------------------------
Securities related to the Underwritten Securities being sold pursuant to
the applicable Terms Agreement include Common Stock, Preferred Stock or
Depositary Shares, such Underlying Securities have been, or as of the date
of such Terms Agreement will have been, duly authorized and reserved for
issuance by the Company upon exercise of the Warrants, as applicable, or
upon conversion of the related Preferred Stock or Depositary Shares, as
applicable. If the Underlying Securities include Common Stock or Preferred
Stock, such Underlying Securities, when issued upon such exercise or
conversion, as applicable, will be validly issued, fully paid and non-
assessable and will not be subject to preemptive or similar rights of any
securityholder of the Company. If the Underlying Securities include
Depositary Shares, such Underlying Securities, upon deposit by the Company
of the Preferred Stock represented thereby with the applicable Depositary
and the execution and delivery by such Depositary of the Depositary
Receipts evidencing such Depositary Shares, in each case pursuant to the
applicable Deposit Agreement, will represent legal and valid interests in
such Preferred Stock. No holder of such Common Stock, Preferred Stock or
Depositary Receipts evidencing Depository Shares is or will be subject to
personal liability by reason of being such a holder. If the Underlying
Securities related to the Underwritten Securities being sold pursuant to
the applicable Terms Agreement include Debt Securities, such Underlying
Securities have been, or as of the date of such Terms Agreement will have
been, duly authorized for issuance by the Company upon
9
conversion or exchange of the related Preferred Stock or Depositary Shares,
as applicable. Such Underlying Securities, when issued and authenticated in
the manner provided for in the applicable Indenture and delivered in
accordance with the terms of the related Preferred Stock or Depositary
Shares, as applicable, will constitute valid and legally binding
obligations of the Company, enforceable against the Company in accordance
with their terms, except as the enforcement thereof may be limited by
bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting creditors' rights generally and except as enforcement thereof is
subject to general principles of equity (regardless of whether enforcement
is considered in a proceeding in equity or at law), and except as
enforcement thereof may be limited by (A) requirements that a claim with
respect to any Debt Securities denominated other than in U.S. dollars (or a
foreign or composite currency judgment in respect of such claim) be
converted into U.S. dollars at a rate of exchange prevailing on a date
determined pursuant to applicable law or (B) governmental authority to
limit, delay or prohibit the making of payments outside the United States.
(16) Authorization of Indentures. If the Underlying Securities related
---------------------------
to the Underwritten Securities being sold pursuant to the applicable Terms
Agreement include Debt Securities, each applicable Indenture has been, or
prior to issuance of such Underwritten Securities will have been, duly
authorized, executed and delivered by the Company and, upon such
authorization, execution and delivery (assuming the due authorization,
execution and delivery by the respective Trustee), will constitute a valid
and legally binding agreement of the Company, enforceable against the
Company in accordance with its terms, except as the enforcement thereof may
be limited by bankruptcy, insolvency, reorganization, moratorium or similar
laws affecting creditors' rights generally and except as enforcement
thereof is subject to general principles of equity (regardless of whether
enforcement is considered in a proceeding in equity or at law), and except
further as enforcement thereof may be limited by (A) requirements that a
claim with respect to any Debt Security denominated other than in U.S.
dollars (or a foreign or composite currency judgment in respect of such
claim) be converted into U.S. dollars at a rate of exchange prevailing on a
date determined pursuant to applicable law or (B) governmental authority to
limit, delay or prohibit the making of payments outside the United States.
(17) Descriptions of the Underwritten Securities, Warrant Agreements,
----------------------------------------------------------------
Deposit Agreements, Indentures and Underlying Securities.
--------------------------------------------------------
The Underwritten Securities being sold pursuant to the applicable Terms
Agreement and each applicable Warrant Agreement, Deposit Agreement and
Indenture, as of the date of the Prospectus, and any Underlying Securities,
when issued and delivered in accordance with the terms of the related
Underwritten Securities, will conform in all material respects to the
respective statements relating thereto contained in the Prospectus and will
be in substantially the respective forms filed or incorporated by
reference, as the case may be, as an exhibit to the Registration Statement.
(18) Absence of Defaults and Conflicts. Neither the Company nor any of
---------------------------------
its subsidiaries is in violation of its charter or by-laws or in default in
the performance or
10
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 Underwriting Agreement, the
applicable Terms Agreement, each applicable Warrant Agreement, Deposit
Agreement and Indenture and any other agreement or instrument entered into
or issued or to be entered into or issued by the Company in connection with
the transactions contemplated hereby or thereby or in the Registration
Statement and the Prospectus and the consummation of the transactions
contemplated herein and in the Registration Statement and the Prospectus
(including the issuance and sale of the Underwritten Securities and the use
of the proceeds from the sale of the Underwritten Securities as described
under the caption "Use of Proceeds") and compliance by the Company with its
obligations hereunder and thereunder 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 a 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 of
the Company pursuant to, the Agreements and Instruments (except for such
conflicts, breaches, defaults, events 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 by-laws of the
Company or any Subsidiary or 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 properties, assets 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 of its subsidiaries (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 of
its subsidiaries.
(19) Absence of Labor Dispute. No labor dispute with the employees
------------------------
of the Company or any of its subsidiaries exists or, to the knowledge of
the Company, is imminent, which may reasonably be expected to result in a
Material Adverse Effect.
(20) Absence of Proceedings. There is not any 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 of its subsidiaries which is required to be disclosed in the
Registration Statement and the Prospectus (other than as stated therein),
or which might reasonably be expected to result in a Material Adverse
Effect, or which might reasonably be expected to materially and adversely
affect the assets, properties, or operations thereof or the consummation of
the transactions contemplated in this Underwriting Agreement, the
applicable Terms Agreement or any applicable Warrant Agreement, Deposit
Agreement or Indenture or the performance by the Company of its obligations
hereunder
11
and thereunder; and the aggregate of all pending legal or governmental
proceedings to which the Company or any of its subsidiaries is a party or
of which any of their respective assets, property, or operations is the
subject which are not described in the Registration Statement and the
Prospectus, including ordinary routine litigation incidental to the
business, could not reasonably be expected to result in a Material Adverse
Effect.
(21) Exhibits. There are no contracts or documents which are of a
--------
character required to be described in the Registration Statement, the
Prospectus or the documents incorporated by reference therein or to be
filed as exhibits thereto which have not been so described and filed as
required.
(22) Absence of Further Requirements. No filing with, or authorization,
-------------------------------
approval, consent, license, order, registration, qualification or decree
of, any court or governmental authority or agency, domestic or foreign, is
necessary or required for the performance by the Company of its obligations
under this Underwriting Agreement or the applicable Terms Agreement or in
connection with the transactions contemplated under this Underwriting
Agreement, such Terms Agreement or any applicable Warrant Agreement,
Deposit Agreement or Indenture, except such as have been already obtained
or as may be required under the 1933 Act, the 1933 Act Regulations, the
1939 Act, the 1939 Act Regulations or state securities or blue sky laws.
(23) Possession of Intellectual Property. The Company and its
-----------------------------------
subsidiaries own or possess, or can acquire on reasonable terms, adequate
trademarks, service marks, trade names and other intellectual property
(collectively, "Intellectual Property") necessary to carry on the business
now operated by them, except where the failure to own or possess or the
lack of ability to acquire such Intellectual Property, singly or in the
aggregate, would not result in a Material Adverse Effect, 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.
(24) 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 except where the
failure to so possess such Governmental Licenses would not, singly or in
the aggregate, have a Material Adverse Effect; 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 where
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
12
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.
(25) Title to Property. The Company and its subsidiaries have good and
-----------------
marketable title to all real property owned by the Company and its
subsidiaries and good title to all other properties 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 Registration Statement and the Prospectus or (B) do not,
singly or in the aggregate, materially affect the value of such property,
do not interfere with the use made and proposed to be made of such property
by the Company or any of its subsidiaries and do not singly or in the
aggregate have a Material Adverse Effect; 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 Prospectus, are in full
force and effect, except where the failure of such leases or subleases to
be in full force and effect would not have a Material Adverse 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 of the continued possession of the leased or subleased premises
under any such lease or sublease.
(26) Commodity Exchange Act. If any related Underlying Securities
----------------------
include Debt Securities, such Debt Securities, upon issuance, will be
excluded or exempted under, or beyond the purview of, the Commodity
Exchange Act, as amended (the "Commodity Exchange Act"), and the rules and
regulations of the Commodity Futures Trading Commission adopted under the
Commodity Exchange Act.
(27) 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
or is exempt therefrom.
(b) Officers' Certificates. Any certificate signed by any officer of the
Company or any of its subsidiaries and delivered to any Underwriter or to
counsel for the Underwriters in connection with the offering of the Underwritten
Securities shall be deemed a representation and warranty by the Company to each
Underwriter as to the matters covered thereby on the date of such certificate
and, unless subsequently amended or supplemented, at each Representation Date
subsequent thereto.
SECTION 2. Sale and Delivery to Underwriters; Closing.
------------------------------------------
(a) Underwritten Securities. The several commitments of the
Underwriters to purchase the Underwritten Securities pursuant to the applicable
Terms Agreement shall be
13
deemed to have been made on the basis of the representations and warranties
herein contained and shall be subject to the terms and conditions herein set
forth.
(b) Option Underwritten Securities. In addition, subject to the terms
and conditions herein set forth, the Company may grant, if so provided in the
applicable Terms Agreement, an option to the Underwriters, severally and not
jointly, to purchase up to the number of the Option Underwritten Securities set
forth therein at a price per Option Underwritten Security equal to the price per
Initial Underwritten Security, less an amount equal to any dividends or
distributions declared by the Company and paid or payable on the Initial
Underwritten Securities but not payable on the Option Underwritten Securities.
Such option, if granted, will expire 30 days after the date of such Terms
Agreement, and may be exercised in whole or in part from time to time only for
the purpose of covering over-allotments which may be made in connection with the
offering and distribution of the Initial Underwritten Securities upon notice by
Merrill Lynch to the Company setting forth the number of Option Underwritten
Securities as to which the several Underwriters are then exercising the option
and the time, date and place of payment and delivery for such Option
Underwritten Securities. Any such time and date of payment and delivery (each, a
"Date of Delivery") shall be determined by Merrill Lynch, but shall not be later
than seven full business days after the exercise of said option, nor in any
event prior to the Closing Time, unless otherwise agreed upon by Merrill Lynch
and the Company. If the option is exercised as to all or any portion of the
Option Underwritten Securities, each of the Underwriters, severally and not
jointly, will purchase that proportion of the total number of Option
Underwritten Securities then being purchased which the number of Initial
Underwritten Securities each such Underwriter has severally agreed to purchase
as set forth in such Terms Agreement bears to the total number of Initial
Underwritten Securities, subject to such adjustments as Merrill Lynch in its
discretion shall make to eliminate any sales or purchases of a fractional number
of Option Underwritten Securities.
(c) Payment. Payment of the purchase price for, and delivery of, the
Initial Underwritten Securities shall be made at the offices of Merrill Lynch,
Pierce, Fenner & Smith Incorporated, World Financial Center, North Tower, New
York, New York 10281, or at such other place as shall be agreed upon by Merrill
Lynch and the Company, at 9:00 A.M. (Eastern time) on the third (fourth, if the
pricing occurs after 4:30 P.M. (Eastern time) on any given day) business day
after the date of the applicable Terms Agreement (unless postponed in accordance
with the provisions of Section 10 hereof), or such other time not later than ten
business days after such date as shall be agreed upon by Merrill Lynch and the
Company (such time and date of payment and delivery being herein called the
"Closing Time"). In addition, in the event that the Underwriters have exercised
their option, if any, to purchase any or all of the Option Underwritten
Securities, payment of the purchase price for, and delivery of such Option
Underwritten Securities, shall be made at the above-mentioned offices of Merrill
Lynch, Pierce, Fenner & Smith Incorporated, World Financial Center, North Tower,
New York, New York 10281, or at such other place as shall be agreed upon by
Merrill Lynch and the Company, on the relevant Date of Delivery as specified in
the notice from Merrill Lynch to the Company.
Payment shall be made to the Company by wire transfer of immediately
available funds to a bank account designated by the Company, against delivery to
Merrill Lynch for its account or, if applicable, for the respective accounts of
the Underwriters of the Underwritten Securities to
14
be purchased by them (unless such Underwritten Securities are issuable only in
the form of one or more global securities registered in the name of a depositary
or a nominee of a depositary, in which event the Underwriters' interest in such
global certificate shall be noted in a manner satisfactory to the Underwriters
and their counsel). It is understood that each Underwriter has authorized
Merrill Lynch, for its account, to accept delivery of, receipt for, and make
payment of the purchase price for, the Underwritten Securities which it has
severally agreed to purchase. Merrill Lynch, individually and not as
representative of the Underwriters, may (but shall not be obligated to) make
payment of the purchase price for the Underwritten Securities to be purchased by
any Underwriter whose funds have not been received by the Closing Time or the
relevant Date of Delivery, as the case may be, but such payment shall not
relieve such Underwriter from its obligations hereunder.
(d) Denominations; Registration. The Underwritten Securities,
certificates for the Underwritten Securities or Depositary Receipts evidencing
the Depositary Shares, as applicable, shall be in such denominations and
registered in such names as Merrill Lynch may request in writing at least one
full business day prior to the Closing Time or the relevant Date of Delivery, as
the case may be. The Underwritten Securities, certificates for the Underwritten
Securities or Depositary Receipts evidencing the Depositary Shares, as
applicable, will be made available for examination and packaging by Merrill
Lynch in The City of New York not later than 10:00 A.M. (Eastern time) on the
business day prior to the Closing Time or the relevant Date of Delivery, as the
case may be.
SECTION 3. Covenants of the Company. The Company covenants with
------------------------
Merrill Lynch, and with each Underwriter participating in the applicable
offering of Underwritten Securities, as follows:
(a) Compliance with Securities Regulations and Commission Requests.
The Company, subject to Section 3(b), will comply with the requirements of Rule
430A of the 1933 Act Regulations and/or Rule 434 of the 1933 Act Regulations, if
and as applicable, and will notify Merrill Lynch immediately, and confirm the
notice in writing, of (i) the effectiveness of any post-effective amendment to
the Registration Statement or the filing of any supplement or amendment to the
Prospectus, (ii) the receipt of any comments from the Commission, (iii) any
request by the Commission for any amendment to the Registration Statement or any
amendment or supplement to the Prospectus or for additional information, and
(iv) the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or of any order preventing or
suspending the use of any preliminary prospectus, or of the suspension of the
qualification of the Underwritten 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 of the 1933 Act Regulations and will take such steps as it deems
necessary to ascertain promptly whether the Prospectus transmitted for filing
under Rule 424 was received for filing by the Commission and, in the event that
it was not, it will promptly file the 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.
15
(b) Filing of Amendments. The Company will give Merrill Lynch notice
of its intention to file or prepare any amendment to the Registration Statement
(including any filing under Rule 462(b) of the 1933 Act Regulations), any Term
Sheet or any amendment, supplement or revision to either the prospectus included
in the Registration Statement at the time it became effective or to the
Prospectus, whether pursuant to the 1933 Act, the 1934 Act or otherwise, will
furnish Merrill Lynch 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 Merrill Lynch or counsel for the Underwriters
shall object.
(c) Delivery of Registration Statements. The Company has furnished or
will deliver to Merrill Lynch and counsel for the Underwriters, without charge,
upon request, signed copies of the 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, and will also deliver to Merrill Lynch, without charge,
a conformed copy of the Registration Statement as originally filed and of each
amendment thereto (without exhibits) for each of the Underwriters. Copies of the
Registration Statement and each amendment thereto furnished to the Underwriters
will be identical to any electronically transmitted copies thereof filed with
the Commission pursuant to EDGAR, except to the extent permitted by Regulation
S-T.
(d) Delivery of Prospectuses. The Company will deliver to each
Underwriter, without charge, as many copies of each preliminary prospectus as
such Underwriter may reasonably request, and the Company hereby consents to the
use of such copies for purposes permitted by the 1933 Act. The Company will
furnish to each Underwriter, without charge, during the period when the
Prospectus is required to be delivered under the 1933 Act or the 1934 Act, such
number of copies of the Prospectus (as amended or supplemented) as such
Underwriter may reasonably request. The Prospectus and any amendments or
supplements thereto furnished to the Underwriters will be identical to any
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 and the 1934 Act and the 1934 Act
Regulations so as to permit the completion of the distribution of the
Underwritten Securities as contemplated in this Underwriting Agreement and the
applicable Terms Agreement and in the Registration Statement and the Prospectus.
If at any time when the Prospectus is required by the 1933 Act or the 1934 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 Underwriters or for the Company, to amend the
Registration Statement in order that the Registration Statement 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
or to amend or supplement the Prospectus in order that the Prospectus will not
include an untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein 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 such counsel, at any such time to amend
the Registration Statement or amend or supplement the Prospectus in order to
comply with the requirements of
16
the 1933 Act or the 1933 Act Regulations, the Company will promptly prepare and
file with the Commission, subject to Section 3(b), such amendment or supplement
as may be necessary to correct such statement or omission or to make the
Registration Statement or the Prospectus comply with such requirements, and the
Company will furnish to the Underwriters, without charge, such number of copies
of such amendment or supplement as the Underwriters may reasonably request.
(f) Blue Sky Qualifications. The Company will use its best efforts, in
cooperation with the Underwriters, to qualify the Underwritten Securities and
any related Underlying Securities for offering and sale under the applicable
securities laws of such states and other jurisdictions (domestic or foreign) as
Merrill Lynch may designate and to maintain such qualifications in effect for a
period of not less than one year from the date of the applicable Terms
Agreement; 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 Underwritten Securities or any related Underlying 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 for a period of not less than one year from the date of such Terms
Agreement.
(g) Earnings Statement. 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) Reservation of Securities. If the applicable Terms Agreement
specifies that any related Underlying Securities include Common Stock, Preferred
Stock, Debt Securities and/or Depositary Shares, the Company will reserve and
keep available at all times, free of preemptive or other similar rights, a
sufficient number of shares of Common Stock, Preferred Stock and/or Debt
Securities, as applicable, for the purpose of enabling the Company to satisfy
any obligations to issue such Underlying Securities upon exercise of the related
Warrants, as applicable, or upon conversion of the Preferred Stock or Depositary
Shares, as applicable.
(i) Use of Proceeds. The Company will use the net proceeds received by
it from the sale of the Underwritten Securities in the manner specified in the
Prospectus under "Use of Proceeds".
(j) Listing. The Company will use its best efforts to effect the
listing of the Underwritten Securities and any related Underlying Securities,
prior to the Closing Time, on any national securities exchange or quotation
system if and as specified in the applicable Terms Agreement.
(k) Restriction on Sale of Securities. Between the date of the
applicable Terms Agreement and the later of termination of any trading
restrictions or the Closing Time, the Company will not, without the prior
written consent of Merrill Lynch, directly or indirectly,
17
issue, sell, offer to sell, grant any option for the sale of, or otherwise
dispose of, the securities specified in such Terms Agreement.
(l) Reporting Requirements. The Company, during the period when the
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 1934 Act
Regulations.
SECTION 4. Payment of Expenses.
-------------------
(a) Expenses. The Company will pay all expenses incident to the
performance of its obligations under this Underwriting Agreement or the
applicable Terms Agreement, including (i) the preparation, printing and filing
of the Registration Statement (including financial statements and exhibits) as
originally filed and of each amendment thereto, (ii) the preparation, printing
and delivery to the Underwriters of this Underwriting Agreement, any Terms
Agreement, any Agreement among Underwriters, any Warrant Agreement, any Deposit
Agreement, any Indenture and such other documents as may be required in
connection with the offering, purchase, sale, issuance or delivery of the
Underwritten Securities or any related Underlying Securities, (iii) the
preparation, issuance and delivery of the Underwritten Securities and any
related Underlying Securities, any certificates for the Underwritten Securities
or such Underlying Securities or Depositary Receipts evidencing the Depositary
Shares, as applicable, to the Underwriters, including any transfer taxes and any
stamp or other duties payable upon the sale, issuance or delivery of the
Underwritten Securities to the Underwriters, (iv) the fees and disbursements of
the Company's counsel, accountants and other advisors or agents (including
transfer agents and registrars), as well as the fees and disbursements of any
Warrant Agent, any Depositary and any Trustee and their respective counsel, (v)
the qualification of the Underwritten Securities and any related Underlying
Securities under state securities laws in accordance with the provisions of
Section 3(f) hereof, including filing fees and the reasonable fees and
disbursements of counsel for the Underwriters in connection therewith and in
connection with the preparation, printing and delivery of the Blue Sky Survey
and any Legal Investment Survey, and any amendment thereto, (vi) the printing
and delivery to the Underwriters of copies of each preliminary prospectus, any
Term Sheet, and the Prospectus and any amendments or supplements thereto, (vii)
the fees charged by nationally recognized statistical rating organizations for
the rating of the Underwritten Securities and any related Underlying Securities,
if applicable, (viii) the fees and expenses incurred with respect to the listing
of the Underwritten Securities and any related Underlying Securities, if
applicable, and (ix) the filing fees incident to, and the reasonable fees and
disbursements of counsel to the Underwriters in connection with, the review, if
any, by the National Association of Securities Dealers, Inc. (the "NASD") of the
terms of the sale of the Underwritten Securities and any related Underlying
Securities.
(b) Termination of Agreement. If the applicable Terms Agreement is
terminated by Merrill Lynch in accordance with the provisions of Section 5 or
Section 9(b)(i) hereof, the Company shall reimburse the Underwriters named in
such Terms Agreement for all of their out-of-pocket expenses, including the
reasonable fees and disbursements of counsel for the Underwriters.
18
SECTION 5. Conditions of Underwriters' Obligations. The obligations
---------------------------------------
of the Underwriters to purchase and pay for the Underwritten Securities pursuant
to the applicable Terms Agreement are subject to the accuracy of the
representations and warranties of the Company contained in Section 1 hereof or
in certificates of any officer of the Company or any of its subsidiaries
delivered pursuant to the provisions hereof, to the performance by the Company
of its covenants and other obligations hereunder, and to the following further
conditions:
(a) Effectiveness of Registration Statement. The Registration
Statement has become effective under the 1933 Act and no stop order suspending
the effectiveness of the Registration Statement shall have been issued under the
1933 Act and no proceedings for that purpose shall have been initiated or be
pending or threatened by the Commission, and any request on the part of the
Commission for additional information shall have been complied with to the
reasonable satisfaction of counsel to the Underwriters. A prospectus containing
information relating to the description of the Underwritten Securities and any
related Underlying Securities, the specific method of distribution and similar
matters shall have been filed with the Commission in accordance with Rule
424(b)(1), (2), (3), (4) or (5), as applicable (or any required post-effective
amendment providing such information shall have been filed and declared
effective in accordance with the requirements of Rule 430A), or, if the Company
has elected to rely upon Rule 434 of the 1933 Act Regulations, a Term Sheet
including the Rule 434 Information shall have been filed with the Commission in
accordance with Rule 424(b)(7).
(b) Opinion of Counsel for Company. At Closing Time, Merrill Lynch
shall have received the favorable opinion, dated as of Closing Time, of Brown &
Wood LLP, counsel for the Company, in form and substance satisfactory to counsel
for the Underwriters, together with signed or reproduced copies of such letter
for each of the other Underwriters, to the effect set forth in Exhibit B hereto
and to such further effect as counsel to the Underwriters may reasonably
request.
(c) Opinion of Counsel for Underwriters. At Closing Time, Merrill
Lynch shall have received the favorable opinion, dated as of Closing Time, of
Sullivan & Cromwell, counsel for the Underwriters, together with signed or
reproduced copies of such letter for each of the other Underwriters, with
respect to the matters set forth in (1), (5), (6) to (13), as applicable, (14),
(15) (solely as to the information in the Prospectus under "Description of Debt
Securities", "Description of Debt Warrants", "Description of Currency Warrants",
"Description of Index Warrants", "Description of Preferred Stock", Description
of Depositary Shares", "Description of Preferred Stock Warrants", "Description
of Common Stock" and "Description of Common Stock Warrants", if any, or any
caption purporting to describe any such Securities), (17), (18) and the
penultimate paragraph of Exhibit B hereto. In giving such opinion, such counsel
may rely, as to all matters governed by the laws of jurisdictions other than the
law of the State of New York, the federal law of the United States and the
General Corporation Law of the State of Delaware, upon the opinions of counsel
satisfactory to Merrill Lynch. Such counsel may also state that, insofar as such
opinion involves factual matters, they have relied, to the extent they deem
proper, upon certificates of officers of the Company and its subsidiaries and
certificates of public officials.
(d) Officers' Certificate. At Closing Time, there shall not have been,
since the date of the applicable Terms Agreement or since the respective dates
as of which information is given
19
in the Prospectus, any 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, and Merrill Lynch shall have
received a certificate of the President, a Vice President, the Treasurer or the
Controller of the Company, dated as of Closing Time, to the effect that (i)
there has been no such material adverse change, (ii) the representations and
warranties in Section 1 are true and correct with the same force and effect as
though expressly made at and as of the Closing Time, (iii) the Company has
complied with all agreements and satisfied all conditions on its part to be
performed or satisfied at or prior to the Closing Time, and (iv) no stop order
suspending the effectiveness of the Registration Statement has been issued and
no proceedings for that purpose have been initiated or threatened by the
Commission.
(e) Accountant's Comfort Letter. At the date hereof and at Closing
Time, Merrill Lynch shall have received from Deloitte & Touche LLP a letter
dated such date, in form and substance satisfactory to Merrill Lynch, together
with signed or reproduced copies for each of the other Underwriters, containing
statements and information of the type ordinarily included in accountants'
"comfort letters" to underwriters with respect to the financial statements and
certain financial information contained in the Registration Statement and the
Prospectus.
(f) Ratings. If the Underlying Securities related to the Underwritten
Securities being sold to the particular Terms Agreement include Debt Securities,
at Closing Time, such Debt Securities shall have the ratings accorded by any
"nationally recognized statistical rating organization", as defined by the
Commission for purposes of Rule 436(g)(2) of the 1933 Act Regulations, if and as
specified in the applicable Terms Agreement. Since the time of execution of such
Terms Agreement, there shall not have occurred a downgrading in the rating
assigned to such Debt Securities or any of the Company's other securities by any
such rating organization, and no such rating organization shall have publicly
announced that it has under surveillance or review, with possible negative
implications, its rating of such Debt Securities or any of the Company's other
securities.
(g) Approval of Listing. At Closing Time, the Underwritten Securities
shall have been approved for listing, subject only to official notice of
issuance, if and as specified in the applicable Terms Agreement.
(h) No Objection. If the Registration Statement or an offering of
Underwritten Securities has been filed with the NASD for review, the NASD shall
not have raised any objection with respect to the fairness and reasonableness of
the underwriting terms and arrangements.
(i) Lock-up Agreements. On the date of the applicable Terms Agreement,
Merrill Lynch shall have received, in form and substance satisfactory to it,
each lock-up agreement, if any, specified in such Terms Agreement as being
required to be delivered by the persons listed therein.
(j) Over-Allotment Option. In the event that the Underwriters are
granted an over-allotment option by the Company in the applicable Terms
Agreement and the Underwriters
20
exercise their option to purchase all or any portion of the Option Underwritten
Securities, the representations and warranties of the Company contained herein
and the statements in any certificates furnished by the Company or any of its
subsidiaries hereunder shall be true and correct as of each Date of Delivery,
and, at the relevant Date of Delivery, Merrill Lynch shall have received:
(1) A certificate, dated such Date of Delivery, of the President, a
Vice President, the Treasurer or the Controller of the Company, confirming that
the certificate delivered at the Closing Time pursuant to Section 5(d) hereof
remains true and correct as of such Date of Delivery.
(2) The favorable opinion of Brown & Wood LLP, counsel for the Company,
in form and substance satisfactory to counsel for the Underwriters, dated such
Date of Delivery, relating to the Option Underwritten Securities and otherwise
to the same effect as the opinion required by Section 5(b) hereof.
(3) The favorable opinion of Sullivan & Cromwell, counsel for the
Underwriters, dated such Date of Delivery, relating to the Option Underwritten
Securities and otherwise to the same effect as the opinion required by Section
5(c) hereof.
(4) A letter from Deloitte & Touche LLP, in form and substance
satisfactory to Merrill Lynch and dated such Date of Delivery, substantially in
the same form and substance as the letter furnished to Merrill Lynch pursuant to
Section 5(e) hereof, except that the "specified date" on the letter furnished
pursuant to this paragraph shall be a date not more than three business days
prior to such Date of Delivery.
(k) Additional Documents. At Closing Time and at each Date of
Delivery, counsel for the Underwriters shall have been furnished with such
documents and opinions as they may require for the purpose of enabling them to
pass upon the issuance and sale of the Underwritten Securities as herein
contemplated and, if applicable, certain matters relating to the Underlying
Securities, or in order to evidence the accuracy of any of the representations
or warranties, or the fulfillment of any of the conditions, herein contained;
and all proceedings taken by the Company in connection with the issuance and
sale of the Underwritten Securities as herein contemplated shall be satisfactory
in form and substance to Merrill Lynch and counsel for the Underwriters.
(l) Termination of Terms Agreement. If any condition specified in this
Section 5 shall not have been fulfilled when and as required to be fulfilled,
the applicable Terms Agreement (or, with respect to the Underwriters' exercise
of any applicable over-allotment option for the purchase of Option Underwritten
Securities on a Date of Delivery after the Closing Time, the obligations of the
Underwriters to purchase the Option Underwritten Securities on such Date of
Delivery) may be terminated by Merrill Lynch by notice to the Company at any
time at or prior to the Closing Time (or such Date of Delivery, as applicable),
and such termination shall be without liability of any party to any other party
except as provided in Section 4 and except that Sections 1, 6, 7 and 8 shall
survive any such termination and remain in full force and effect.
21
SECTION 6. Indemnification.
-----------------
(a) Indemnification of Underwriters. The Company agrees to indemnify
and hold harmless each Underwriter and each person, if any, who controls any
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act as follows:
(1) 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 Registration Statement
(or any amendment thereto), including the Rule 430A Information and the
Rule 434 Information deemed to be a part thereof, if applicable, 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 included in any preliminary prospectus or the 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;
(2) 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; provided that (subject to Section
6(d) below) any such settlement is effected with the written consent of the
Company; and
(3) against any and all expense whatsoever, as incurred (including
the fees and disbursements of counsel chosen by Merrill Lynch), 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, to
the extent that any such expense is not paid under (1) or (2) 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 any
Underwriter expressly for use in the Registration Statement (or any amendment
thereto), including the Rule 430A Information and the Rule 434 Information
deemed to be a part thereof, if applicable, or any preliminary prospectus or the
Prospectus (or any amendment or supplement thereto).
Insofar as this indemnity agreement may permit indemnification for
liabilities under the 1933 Act of any person who is a partner of an Underwriter
or who controls an Underwriter within the meaning of Section 15 of the 1933 Act
or Section 20 of the 1934 Act and who is a director or officer of the Company or
controls the Company within the meaning of Section 15 of
22
the 1933 Act or Section 20 of the 1934 Act, such indemnity agreement is subject
to the undertaking of the Company in the Registration Statement under Item 13 of
Form S-3.
(b) Indemnification of Company, Directors and Officers. Each
Underwriter severally agrees to indemnify and hold harmless the Company, its
directors, each of its officers who signed the 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 Registration
Statement (or any amendment thereto), including the Rule 430A Information and
the Rule 434 Information deemed to be a part thereof, if applicable, or any
preliminary prospectus or the Prospectus (or any amendment or supplement
thereto) in reliance upon and in conformity with written information furnished
to the Company by such Underwriter through Merrill Lynch expressly for use in
the Registration Statement (or any amendment thereto) or such preliminary
prospectus or the Prospectus (or any amendment or supplement thereto).
(c) Documentary Stamp or Similar Issue Tax Indemnification. The
Company agrees to indemnify and hold harmless each Underwriter against any
documentary stamp or similar issue tax and any related interest or penalties on
the issue or sale of the Underwritten Securities to the Underwriters which are
due in the United States of America, the United Kingdom or any other
jurisdiction.
(d) 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 any liability which it may have otherwise than on account of this
indemnity agreement. In the case of parties indemnified pursuant to Section 6(a)
above, counsel to the indemnified parties shall be selected by Merrill Lynch,
and, in the case of parties indemnified pursuant to Section 6(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, except that the Company shall be
liable for the fees and expenses of one counsel representing Merrill Lynch and
the persons controlling Merrill Lynch and one counsel representing all other
Underwriters and the persons controlling them. 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 6 or Section
7 hereof (whether or not the indemnified parties are actual or potential
23
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.
(e) 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 6(a)(2) 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 7. Contribution. If the indemnification provided for in
------------
Section 6 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 each indemnifying party 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 Underwriters, on the other hand, from the
offering of the Underwritten Securities pursuant to the applicable Terms
Agreement 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 Underwriters, 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 relative benefits received by the Company, on the one hand, and the
Underwriters, on the other hand, in connection with the offering of the
Underwritten Securities pursuant to the applicable Terms Agreement shall be
deemed to be in the same respective proportions as the total net proceeds from
the offering of such Underwritten Securities (before deducting expenses)
received by the Company and the total underwriting discount received by the
Underwriters, in each case as set forth on the cover of the Prospectus, or, if
Rule 434 is used, the corresponding location on the Term Sheet bear to the
aggregate initial public offering price of such Underwritten Securities as set
forth on such cover.
The relative fault of the Company, on the one hand, and the Underwriters,
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 or by the Underwriters and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.
The Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 7 were determined by pro rata
allocation (even if the
24
Underwriters were treated as one entity for such purpose) or by any other method
of allocation which does not take account of the equitable considerations
referred to above in this The aggregate amount of losses, liabilities, claims,
damages and expenses incurred by an indemnified party and referred to above in
this Section 7 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.
Notwithstanding the provisions of this Section 7, no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the Underwritten Securities underwritten by it and distributed to
the public were offered to the public exceeds the amount of any 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 1933 Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 7, 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 such Underwriter, and
each 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 Section 15 of the 1933 Act or Section 20 of the 1934 Act shall
have the same rights to contribution as the Company. The Underwriters'
respective obligations to contribute pursuant to this Section 7 are several in
proportion to the number or aggregate principal amount, as the case may be, of
Initial Underwritten Securities set forth opposite their respective names in the
applicable Terms Agreement, and not joint.
SECTION 8. Representations, Warranties and Agreements to Survive
-----------------------------------------------------
Delivery. All representations, warranties and agreements contained in this
- ---------
Underwriting Agreement or the applicable Terms Agreement or in certificates of
officers of the Company submitted pursuant hereto or thereto shall remain
operative and in full force and effect, regardless of any investigation made by
or on behalf of any Underwriter or controlling person, or by or on behalf of the
Company, and shall survive delivery of and payment for the Underwritten
Securities.
SECTION 9. Termination.
-----------
(a) Underwriting Agreement. This Underwriting Agreement (excluding the
applicable Terms Agreement) may be terminated for any reason at any time by the
Company or by Merrill Lynch upon the giving of 30 days' prior written notice of
such termination to the other party hereto.
(b) Terms Agreement. Merrill Lynch may terminate the applicable Terms
Agreement, by notice to the Company, at any time at or prior to the Closing Time
or any relevant Date of Delivery, if (i) there has been, since the time of
execution of such Terms Agreement or
25
since the respective dates as of which information is given in the Prospectus,
any 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, or (ii) there has occurred any material adverse
change in the financial markets in the United States or, if the Underwritten
Securities or any related Underlying Securities include Debt Securities
denominated or payable in, or indexed to, one or more foreign or composite
currencies, in the international financial markets, or any outbreak of
hostilities or escalation thereof or other calamity or crisis or any change or
development involving a prospective change in national or international
political, financial or economic conditions, in each case the effect of which is
such as to make it, in the judgment of Merrill Lynch, impracticable to market
the Underwritten Securities or to enforce contracts for the sale of the
Underwritten Securities, or (iii) trading in any securities of the Company has
been suspended or limited by the Commission or the New York Stock Exchange, or
if trading generally on the New York Stock Exchange or the American Stock
Exchange or in the Nasdaq National Market has been suspended or limited, or
minimum or maximum prices for trading have been fixed, or maximum ranges for
prices have been required, by either of said exchanges or by such system or by
order of the Commission, the NASD or any other governmental authority, or (iv) a
banking moratorium has been declared by either Federal or New York authorities
or, if the Underwritten Securities or any related Underlying Securities include
Debt Securities denominated or payable in, or indexed to, one or more foreign or
composite currencies, by the relevant authorities in the related foreign country
or countries.
(c) Liabilities. If this Underwriting Agreement or the applicable
Terms Agreement is terminated pursuant to this Section 9, such termination shall
be without liability of any party to any other party except as provided in
Section 4 hereof, and provided further that Sections 1, 6, 7 and 8 shall survive
such termination and remain in full force and effect.
SECTION 10. Default by One or More of the Underwriters. If one or
------------------------------------------
more of the Underwriters shall fail at the Closing Time or the relevant Date of
Delivery, as the case may be, to purchase the Underwritten Securities which it
or they are obligated to purchase under the applicable Terms Agreement (the
"Defaulted Securities"), then Merrill Lynch shall have the right, within 24
hours thereafter, to make arrangements for one or more of the non-defaulting
Underwriters, or any other underwriters, to purchase all, but not less than all,
of the Defaulted Securities in such amounts as may be agreed upon and upon the
terms herein set forth; if, however, Merrill Lynch shall not have completed such
arrangements within such 24-hour period, then:
(a) if the number or aggregate principal amount, as the case may be, of
Defaulted Securities does not exceed 10% of the number of Underwritten
Securities to be purchased on such date pursuant to such Terms Agreement, the
non-defaulting Underwriters shall be obligated, severally and not jointly, to
purchase the full amount thereof in the proportions that their respective
underwriting obligations under such Terms Agreement bear to the underwriting
obligations of all non-defaulting Underwriters, or
(b) if the number of Defaulted Securities exceeds 10% of the number of
Underwritten Securities to be purchased on such date pursuant to such Terms
Agreement, such Terms
26
Agreement (or, with respect to the Underwriters' exercise of any applicable
over-allotment option for the purchase of Option Underwritten Securities on a
Date of Delivery after the Closing Time, the obligations of the Underwriters to
purchase, and the Company to sell, such Option Underwritten Securities on such
Date of Delivery) shall terminate without liability on the part of any non-
defaulting Underwriter.
No action taken pursuant to this Section 10 shall relieve any defaulting
Underwriter from liability in respect of its default.
In the event of any such default which does not result in (i) a termination
of the applicable Terms Agreement or (ii) in the case of a Date of Delivery
after the Closing Time, a termination of the obligations of the Underwriters and
the Company with respect to the related Option Underwritten Securities, as the
case may be, either Merrill Lynch or the Company shall have the right to
postpone the Closing Time or the relevant Date of Delivery, as the case may be,
for a period not exceeding seven days in order to effect any required changes in
the Registration Statement or the Prospectus or in any other documents or
arrangements.
SECTION 11. 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
Underwriters shall be directed to Merrill Lynch at World Financial Center, North
Tower, New York, New York 10281-1332, attention of Patricia A. Verrilli,
Managing Director, or in respect of any Terms Agreement, to such other person
and place as may be specified therein; and notices to the Company shall be
directed to it at 100 Church Street, 12th Floor, New York, New York 10080-6512,
attention of the Secretary with a copy to the Treasurer at World Financial
Center, South Tower, 225 Liberty Street, New York, New York 10080-6105.
SECTION 12. Parties. This Underwriting Agreement and the applicable
-------
Terms Agreement shall each inure to the benefit of and be binding upon the
Company, Merrill Lynch and, upon execution of such Terms Agreement, any other
Underwriters and their respective successors. Nothing expressed or mentioned in
this Underwriting Agreement or such Terms Agreement is intended or shall be
construed to give any person, firm or corporation, other than the Underwriters
and the Company and their respective successors and the controlling persons and
officers and directors referred to in Sections 6 and 7 and their heirs and legal
representatives, any legal or equitable right, remedy or claim under or in
respect of this Underwriting Agreement or such Terms Agreement or any provision
herein or therein contained. This Underwriting Agreement and such Terms
Agreement and all conditions and provisions hereof and thereof are intended to
be for the sole and exclusive benefit of the parties hereto and thereto 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 Underwritten Securities from
any Underwriter shall be deemed to be a successor by reason merely of such
purchase.
SECTION 13. GOVERNING LAW. THIS UNDERWRITING AGREEMENT AND ANY
-------------
APPLICABLE TERMS AGREEMENT SHALL BE GOVERNED BY AND
27
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO
AGREEMENTS MADE AND TO BE PERFORMED IN SUCH STATE.
SECTION 14. 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.
If the foregoing is in accordance with your understanding of our agreement,
please sign and return to the Company a counterpart hereof, whereupon this
Underwriting Agreement, along with all counterparts, will become a binding
agreement between Merrill Lynch and the Company in accordance with its terms.
Very truly yours,
MERRILL LYNCH & CO., INC.
By:
---------------------------
Name:
Title:
CONFIRMED AND ACCEPTED,
as of the date first above written:
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
By:
---------------------------
Authorized Signatory
28
Exhibit A
MERRILL LYNCH & CO., INC.
(a Delaware corporation)
Common Stock, Warrants to Purchase Common Stock,
Preferred Stock, Warrants to Purchase Preferred Stock,
and Depositary Shares
TERMS AGREEMENT
---------------
[Date]
To: Merrill Lynch & Co., Inc.
World Financial Center
North Tower
New York, New York 10281-1332
Ladies and Gentlemen:
We understand that Merrill Lynch & Co., Inc., a Delaware corporation
(the "Company"), proposes to issue and sell [ shares of its common stock,
par value $1.33 per share, including any preferred share purchase Rights
attached thereto (the "Common Stock")] [ shares of its preferred stock,
par value $1.00 per share (the "Preferred Stock")] [in the form of
depositary shares (the "Depositary Shares") each representing of a share
of Preferred Stock] [ warrants (the "Common Stock Warrants") to purchase
common stock, par value $1.33 per share] [ warrants (the
"Preferred Stock Warrants") to purchase preferred stock, par value $1.00 per
share] ([such securities also being hereinafter referred to as] the "[Initial]
Underwritten Securities"). Subject to the terms and conditions set forth or
incorporated by reference herein, we [the underwriters named below (the
"Underwriters")] offer to purchase [, severally and not jointly,] the number of
Underwritten Securities [opposite their names set forth below] at the purchase
price set forth below [, and a proportionate share of Option Underwritten
Securities set forth below, to the extent any are purchased].
A-1
Underwriter [Number] of [Initial] Underwritten Securities
- ----------- ---------------------------------------------
Total -----------
===========
The Underwritten Securities shall have the following terms:
[Common Stock]
--------------
Title:
Number of shares:
Number of Option Underwritten Securities:
Initial public offering price per share: $
Purchase price per share: $
Listing requirements:
Black-out provisions:
Lock-up provisions:
Other terms and conditions:
Closing date and location:
[Preferred Stock]
-----------------
Title:
Rank:
Ratings:
Number of shares:
Number of Option Underwritten Securities:
Dividend rate (or formula) per share: $
Dividend payment dates:
Stated value: $
Liquidation preference per share: $
Redemption provisions:
Sinking fund requirements:
Conversion provisions:
Listing requirements:
Black-out provisions:
Lock-up provisions:
Initial public offering price per share: $___ plus accumulated dividends, if
any, from _____
Purchase price per share: $___ plus accumulated dividends, if any, from _____
Other terms and conditions:
Closing date and location:
A-2
[Depositary Shares]
-----------------
Title:
Fractional amount of Preferred Stock represented by each Depositary Share:
Ratings:
Rank:
Number of shares:
Number of Option Underwritten Securities:
Dividend rate (or formula) per share:
Dividend payment dates:
Liquidation preference per share:
Redemption provisions:
Sinking fund requirements:
Conversion provisions:
Listing requirements:
Black-out provisions:
Lock-up provisions:
Initial public offering price per share: $____ plus accumulated dividends, if
any, from ___
Purchase price per share: $____ plus accumulated dividends, if any, from ___
Other terms and conditions:
Closing date and location:
[Common Stock] [Preferred Stock] Warrants
-----------------------------------------
Title:
Type:
Number:
Warrant Agent:
Issuable jointly with [Common Stock] [Preferred Stock]: [Yes] [No]
Number of [Common Stock] [Preferred Stock] Warrants issued with each [share
of Common Stock] [share of Preferred Stock]:
Date(s) from which or period(s) during which [Common Stock] [Preferred Stock]
Warrants
are exercisable:
Date(s) on which [Common Stock] [Preferred Stock] Warrants expire:
Exercise price(s):
Initial public offering price: $
Purchase price: $
Title of Underlying Securities:
[Number of shares] [Principal amount] purchasable upon exercise of one [Common
Stock]
[Preferred Stock] Warrant:
Terms of Underlying Securities:
Other terms and conditions:
Closing date and location:
A-3
All of the provisions contained in the document attached as Annex I hereto
entitled "MERRILL LYNCH & CO., INC.-- Common Stock, Warrants to Purchase Common
Stock, Preferred Stock, Warrants to Purchase Preferred Stock, Depositary Shares-
- -Underwriting Agreement" are hereby incorporated by reference in their entirety
herein and shall be deemed to be a part of this Terms Agreement to the same
extent as if such provisions had been set forth in full herein. Terms defined
in such document are used herein as therein defined.
[The Company agrees that between the date hereof and the later of
termination of any trading restrictions or the Closing Date, as herein
specified, the Company will not, without the prior written consent of the
Underwriter, directly or indirectly, issue, sell, offer to sell, grant any
option for sale of, or otherwise dispose of the following securities:
_____________________.]
Please accept this offer no later than ____ o'clock P.M. (New York City
time) on ______________ by signing a copy of this Terms Agreement in the space
set forth below and returning the signed copy to us.
Very truly yours,
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
By
---------------------------
Authorized Signatory
[Acting on behalf of itself and the other named
Underwriters.]
Accepted:
MERRILL LYNCH & CO., INC.
By
---------------------------
Name:
Title:
A-4
Exhibit B
FORM OF OPINION OF COMPANY'S COUNSEL
TO BE DELIVERED PURSUANT TO
SECTION 5(b)
(1) The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Delaware.
(2) The Company has corporate power and authority to own, lease and
operate its properties and to conduct its business as described in the
Prospectus and to enter into and perform its obligations under, [or as
contemplated under,] the Underwriting Agreement and the applicable Terms
Agreement.
(3) The Company 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 to so qualify or
be in good standing would not result in a Material Adverse Effect (as defined in
Section 1(a)(5) of the Underwriting Agreement).
(4) Merrill Lynch, Pierce, Fenner & Smith Incorporated ("MLPF&S") has
been duly incorporated and is validly existing as a corporation in good standing
under the laws of the State of Delaware, has corporate power and authority to
own, lease and operate its properties and to conduct its business as described
in the Prospectus and is duly qualified as a foreign corporation to transact
business and is in good standing in the State of New York; all of the issued and
outstanding capital stock of MLPF&S has been duly authorized and validly issued,
is fully paid and non-assessable and, to the best of our knowledge, is owned by
the Company, directly or through subsidiaries, free and clear of any security
interest, mortgage, pledge, lien, encumbrance, claim or equity; and none of the
outstanding shares of capital stock of MLPF&S was issued in violation of
preemptive or similar rights of any securityholder of MLPF&S.
(5) The Underwriting Agreement and the applicable Terms Agreement have
been duly authorized, executed and delivered by the Company.
(6) [Include if the Prospectus contains a "Capitalization" section --]
The authorized, issued and outstanding shares of capital stock of the Company is
as set forth in the Prospectus under the caption "Capitalization" (except for
subsequent issuances thereof, if any, contemplated under the Underwriting
Agreement, pursuant to 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). Such shares of capital
stock have been duly authorized and validly issued by the Company and are fully
paid and non-assessable, and none of such shares of capital stock was issued in
violation of preemptive or similar rights of any securityholder of the Company.
(7) [Include if the Underwritten Securities being sold pursuant to the
applicable Terms Agreement include Common Stock --] The Underwritten Securities
have been duly authorized by
B-1
the Company for issuance and sale pursuant to the Underwriting Agreement and the
applicable Terms Agreement. The Underwritten Securities, when issued and
delivered by the Company pursuant to the Underwriting Agreement and such Terms
Agreement against payment of the consideration therefor specified in such Terms
Agreement, will be validly issued, fully paid and non-assessable and will not be
subject to preemptive or similar rights of any securityholder of the Company. No
holder of the Underwritten Securities is or will be subject to personal
liability by reason of being such a holder. The form of certificate used to
evidence the Underwritten Securities is in due and proper form and complies with
the applicable statutory requirements, with any applicable requirements of the
charter or by-laws of the Company and with the requirements of the New York
Stock Exchange.
(8) [Include if the Underwritten Securities being sold pursuant to the
applicable Terms Agreement include Preferred Stock and/or Depositary Shares--]
The Underwritten Securities have been duly authorized by the Company for
issuance and sale pursuant to the Underwriting Agreement and the applicable
Terms Agreement. The applicable Preferred Stock, when issued and delivered by
the Company pursuant to the Underwriting Agreement and such Terms Agreement
against payment of the consideration [therefor] [for the related Depositary
Shares] specified in such Terms Agreement, will be validly issued, fully paid
and non-assessable and will not be subject to preemptive or similar rights of
any securityholder of the Company. In addition, upon deposit by the Company of
any Preferred Stock represented by Depositary Shares with the applicable
Depositary and the execution and delivery by such Depositary of the Depositary
Receipts evidencing such Depositary Shares, in each case pursuant to the
applicable Deposit Agreement, such Depositary Shares will represent legal and
valid interests in such Preferred Stock. No holder of such Preferred Stock or
Depositary Receipts evidencing such Depositary Shares is or will be subject to
personal liability by reason of being such a holder. The form of certificate
used to evidence the [Preferred Stock] [Depositary Receipts evidencing
Depositary Shares ] is in due and proper form and complies with the applicable
statutory requirements, with any applicable requirements of the charter or by-
laws of the Company and with the requirements of the [ Stock Exchange/Nasdaq
National Market]. The applicable Certificate of Designations is in full force
and effect.
(9) [Include if the Underwritten Securities being sold pursuant to the
applicable Terms Agreement include Depositary Shares --] The applicable Deposit
Agreement has been duly authorized, executed and delivered by the Company and
(assuming due authorization, execution and delivery thereof by the applicable
Depositary) constitutes a valid and legally binding agreement of the Company,
enforceable against the Company in accordance with its terms, except as the
enforcement thereof may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting creditors' rights generally and except as
enforcement thereof is subject to general principles of equity (regardless of
whether enforcement is considered in the proceeding in equity or at law). Each
registered holder of a Depositary Receipt under the applicable Deposit Agreement
will be entitled to the proportional rights, preferences and limitations of the
Preferred Stock represented by the Depositary Shares evidenced by such
Depositary Receipt and to such other rights as are granted to such registered
holder in such Deposit Agreement.
(10) [Include if the Underwritten Securities being sold pursuant to the
applicable Terms Agreement include Warrants --] The Underwritten Securities have
been duly authorized by the Company for issuance and sale pursuant to the
Underwriting Agreement and the applicable Terms
B-2
Agreement. The Underwritten Securities, when issued and authenticated in the
manner provided for in the applicable Warrant Agreement and delivered against
payment of the consideration therefor specified in such Terms Agreement, will
constitute valid and legally binding obligations of the Company, entitled to the
benefits provided by such Warrant Agreement and enforceable against the Company
in accordance with their terms, except as the enforcement thereof may be limited
by bankruptcy, insolvency, reorganization, moratorium or other similar laws
relating to or affecting creditors' rights generally and except as enforcement
thereof is subject to general principles of equity (regardless of whether
enforcement is considered in a proceeding in equity or at law).
(11) [Include if the Underwritten Securities being sold pursuant to the
applicable Terms Agreement include Warrants --] The [Each] applicable Warrant
Agreement has been duly authorized, executed and delivered by the Company and
(assuming due authorization, execution and delivery thereof by the applicable
Warrant Agent) constitutes a valid and legally binding agreement of the Company,
enforceable against the Company in accordance with its terms, except as the
enforcement thereof may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws relating to or affecting creditors' rights
generally and except as the enforcement thereof is subject to general principles
of equity (regardless of whether enforcement is considered in a proceeding in
equity or at law).
(12) [Include if the Underlying Securities related to the Underwritten
Securities being sold pursuant to the applicable Terms Agreement include Common
Stock, Preferred Stock or Depositary Shares --] The Underlying Securities have
been duly authorized and reserved for issuance by the Company [upon exercise of
the [Common Stock] [Preferred Stock] Warrants] [upon conversion of the related
[Preferred Stock] [Depositary Shares]. The Underlying Securities, when issued
upon such [exercise] [conversion], will be validly issued, fully paid and non-
assessable and will not be subject to preemptive or similar rights of any
securityholder of the Company. [In addition, the Underlying Securities, upon
deposit by the Company of the Preferred Stock represented thereby with the
applicable Depositary and the execution and delivery by such Depositary of the
Depositary Receipts evidencing such Underlying Securities, in each case pursuant
to the applicable Deposit Agreement, will represent legal and valid interests in
such Preferred Stock.] No holder of the Underlying Securities is or will be
subject to personal liability by reason of being such a holder. [Include if the
Underlying Securities related to the Underwritten Securities being sold pursuant
to the applicable Terms Agreement include Senior Debt Securities and/or
Subordinated Debt Securities --] The Underlying Securities have been duly
authorized for issuance by the Company [upon conversion or exchange of the
related [Preferred Stock] [Depositary Shares]]. The Underlying Securities, when
issued and authenticated in the manner provided for in the applicable Indenture
and delivered in accordance with the terms of the [related [Preferred Stock]
[Depositary Shares]], will constitute valid and legally binding obligations of
the Company, enforceable against the Company in accordance with their terms,
except as the enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditors' rights generally
and except as enforcement thereof is subject to general principles of equity
(regardless of whether enforcement is considered in a proceeding in equity or at
law)[, and except further as enforcement thereof may be limited by (A)
requirements that a claim with respect to any Debt Securities denominated other
than in U.S. dollars (or a foreign or composite currency judgment in respect of
such claim) be converted into U.S. dollars at a rate of exchange prevailing on
B-3
a date determined pursuant to applicable law or (B) governmental authority to
limit, delay or prohibit the making of payments outside the United States].
(13) [Include if the Underlying Securities related to the Underwritten
Securities being sold pursuant to the applicable Terms Agreement include Debt
Securities --] The [Each] applicable Indenture has been duly authorized,
executed and delivered by the Company and (assuming due authorization, execution
and delivery thereof by the respective Trustee) constitutes a valid and legally
binding agreement of the Company, enforceable against the Company in accordance
with its terms, except as the enforcement thereof may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting creditors'
rights generally and except as enforcement thereof is subject to general
principles of equity (regardless of whether enforcement is considered in a
proceeding in equity or at law)[, and except further as enforcement thereof may
be limited by (A) requirements that a claim with respect to any Debt Security
denominated other than in U.S. dollars (or a foreign or composite currency
judgment in respect of such claim) be converted into U.S. dollars at a rate of
exchange prevailing on a date determined pursuant to applicable law or (B)
governmental authority to limit, delay or prohibit the making of payments
outside the United States].
(14) The Underwritten Securities being sold pursuant to the applicable
Terms Agreement and the [each] applicable [Warrant Agreement] [Deposit
Agreement] [Indenture] conform, and any Underlying Securities, when issued and
delivered in accordance with the terms of the related Underwritten Securities,
will conform, in all material respects to the statements relating thereto
contained in the Prospectus and are in substantially the form filed or
incorporated by reference, as the case may be, as an exhibit to the Registration
Statement.
(15) The information in the Prospectus under "Description of Debt
Securities", "Description of Debt Warrants", "Description of Currency Warrants",
"Description of Index Warrants", "Description of Preferred Stock", "Description
of Depositary Shares", "Description of Preferred Stock Warrants", "Description
of Common Stock" and "Description of Common Stock Warrants" or any caption
purporting to describe any such Securities, and in the Registration Statement
under Item 15, to the extent that it constitutes matters of law, summaries of
legal matters, the Company's charter and by-laws or legal proceedings, or legal
conclusions, has been reviewed by us and is correct in all material respects.
(16) The execution, delivery and performance of the Underwriting
Agreement, the applicable Terms Agreement and the [each] applicable [Warrant
Agreement] [Deposit Agreement] [Indenture] and any other agreement or instrument
entered into or issued or to be entered into or issued by the Company in
connection with the transactions contemplated in the Registration Statement and
the Prospectus and the consummation of the transactions contemplated in the
Underwriting Agreement and such Terms Agreement and in the Registration
Statement and the Prospectus (including the issuance and sale of the
Underwritten Securities and the use of the proceeds from the sale of the
Underwritten Securities as described under the caption "Use of Proceeds") and
compliance by the Company with its obligations thereunder 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 a default or Repayment Event (as
defined in Section 1(a)(18) of the Underwriting Agreement) under or result in
the creation or imposition of any lien, charge or encumbrance upon
B-4
any property or assets of the Company or any subsidiary of the Company pursuant
to, any contract, indenture, mortgage, deed of trust, loan or credit agreement,
note, lease or any other agreement or instrument, known to us, 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 its
subsidiaries is subject, except for such conflicts, breaches, defaults, liens,
events, 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 by-laws of the Company or any Subsidiary or any applicable law,
statute, rule, regulation, judgment, order, writ or decree, known to us, of any
government, government instrumentality or court, domestic or foreign, having
jurisdiction over the Company or any Subsidiary or any of their properties,
assets or operations.
(17) The Registration Statement has been declared effective under the
1933 Act. Any required filing of the Prospectus pursuant to Rule 424(b) has been
made in the manner and within the time period required by Rule 424(b); and to
the best of our knowledge, no stop order suspending the effectiveness of the
Registration Statement has been issued under the 1933 Act and no proceedings for
that purpose have been initiated or are pending or threatened by the Commission.
Each applicable Indenture is qualified under the 1939 Act.
(18) The Registration Statement and the Prospectus, excluding the
documents incorporated by reference therein, and each amendment or supplement to
the Registration Statement and Prospectus, excluding the documents incorporated
by reference therein, as of their respective effective or issue dates (other
than the financial statements and supporting schedules included therein or
omitted therefrom and each Trustee's Statement of Eligibility on Form T-1 (the
"Form T-1s"), as to which we express no opinion) complied as to form in all
material respects with the requirements of the 1933 Act and the 1933 Act
Regulations.
(19) The documents incorporated by reference in the Prospectus (other
than the financial statements and supporting schedules therein or omitted
therefrom, as to which we express 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 1933 Act or the 1934 Act, as
applicable, and the rules and regulations of the Commission thereunder.
(20) No filing with, or authorization, approval, consent, license, order
registration, qualification or decree of, any court or governmental authority or
agency, domestic or foreign, is necessary or required for the performance by the
Company of its obligations under the Underwriting Agreement or the applicable
Terms Agreement or in connection with the transactions contemplated under the
Underwriting Agreement, such Terms Agreement or the [any] applicable [Warrant
Agreement] [Deposit Agreement] [Indenture], except such as have been obtained,
or as may be required under the 1933 Act, the 1933 Act Regulations, the 1939 Act
and the 1939 Act Regulations or state securities or blue sky laws.
(21) [Include if required in Terms Agreement with respect to Underlying
Securities that include Debt Securities --] The Underlying Securities, upon
issuance, will be excluded or exempted under, or beyond the purview of, the
Commodity Exchange Act, as amended (the "Commodity Exchange Act") and the rules
and regulations of the Commodity Futures Trading Commission adopted under the
Commodity Exchange Act.
B-5
We have participated in conferences with officers and representatives
of the Company, representatives of the independent accountants of the Company
and the Underwriters at which the contents of the Registration Statement and
Prospectus and related matters were discussed and, although we are not passing
upon or assuming responsibility for the accuracy, completeness or fairness of
the statements contained or incorporated by reference in the Registration
Statement and Prospectus and have made no independent check or verification
thereof, on the basis of the foregoing, nothing has come to our attention that
would lead us to believe that the Registration Statement or any post-effective
amendment thereto (except for financial statements and schedules and other
financial data included or incorporated therein or omitted therefrom and the
Form T-1s, as to which we make no statement), at the time the Registration
Statement or any post-effective amendment thereto (including the filing of the
Company's Annual Report on Form 10-K with the Commission) became effective or at
the date of the applicable Terms Agreement, contained an untrue statement of a
material fact or omitted to state a material fact required to be stated therein
or necessary to make the statements therein not misleading or that the
Prospectus or any amendment or supplement thereto (except for financial
statements and schedules and other financial data included or incorporated
therein or omitted therefrom, as to which we make no statement), at the time the
Prospectus was issued, at the time any such amended or supplemented prospectus
was issued or at the Closing Time, included or includes an untrue statement of a
material fact or omitted or omits to state a material fact necessary in order to
make the statements therein, in the light of the circumstances under which they
were made, not misleading.
In rendering such opinion, such counsel may rely, as to matters of fact
(but not as to legal conclusions), to the extent they deem proper, on
certificates of responsible officers of the Company and public officials.
B-6