1
Exhibit 1.1
4,000,000 Shares
RMI TITANIUM COMPANY
COMMON STOCK
UNDERWRITING AGREEMENT
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April __, 1996
LEHMAN BROTHERS INC.
SALOMON BROTHERS INC,
As Representatives of the several
Underwriters named in Schedule 1,
c/o Lehman Brothers Inc.
Three World Financial Center
New York, New York 10285
Ladies and Gentlemen:
RMI Titanium Company, an Ohio corporation (the "Company"), proposes to sell
4,000,000 shares (the "Firm Stock") of the Company's common stock, par value
$.01 per share (the "Common Stock"). In addition, the Company proposes to
grant to the Underwriters named in Schedule 1 hereto (the "Underwriters") an
option to purchase up to an additional 600,000 shares of the Common Stock on
the terms and for the purposes set forth in Section 2 (the "Option Stock").
The Firm Stock and the Option Stock, if purchased, are hereinafter collectively
called the "Stock." This is to confirm the agreement concerning the purchase of
the Stock from the Company by the Underwriters.
1. Representations, Warranties and Agreements of the Company. The Company
represents, warrants, and agrees that:
(a) A registration statement on Form S-3 and amendments thereto with
respect to the Stock have (i) been prepared by the Company in conformity
with the requirements of the Securities Act of 1933, as amended (the
"Securities Act") and the rules and regulations (the "Rules and
Regulations") of the Securities and Exchange Commission (the
"Commission") thereunder, (ii) been filed with the Commission under
the Securities Act and (iii) become effective under the Securities
Act; and a second registration statement on Form S-3 with respect to
the Stock (i) may also be prepared by the Company in conformity with
the requirements of the Securities Act and the Rules and Regulations
and (ii) if to be so prepared, will be filed with the Commission under
the Securities Act pursuant to Rule 462(b) of the Rules and
Regulations on the date hereof. Copies of the first such registration
statement and the amendments to such registration statement, together
with the form of any such second registration statement, have been
delivered by the Company to you as the representatives (the
"Representatives"). As used in this Agreement, "Effective Time"
means (i) with respect to the first such registration statement, the
date and the time as of which such registration statement, or the
most recent post-effective amendment thereto, if any, was declared
effective by the Commission and (ii) with respect to any second
registration statement, the date and time as of which such second
registration statement is filed with the Commission, and "Effective
Times" is the collective reference to both Effective Times; "Effective
Date" means (i) with respect to the first such registration statement,
the date of the Effective Time of such registration statement and (ii)
with respect to any second registration statement, the date of the
Effective Time of such second registration statement, and "Effective
Dates" is the collective reference to both Effective Dates;
"Preliminary Prospectus" means each prospectus included in any such
registration statement, or amendments thereof, before it became
effective under the Securities Act and any prospectus filed with
the Commission by the Company with the consent of the Representatives
pursuant to Rule 424(a) of the Rules and Regulations; "Primary
Registration
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Statement" means the first registration statement referred to in
this Section 1(a), as amended at its Effective Time, "Rule 462(b)
Registration Statement" means the second registration statement, if
any, referred to in this Section 1(a), as filed with the Commission,
and "Registration Statements" means both the Primary Registration
Statement and any Rule 462(b) Registration Statement, including in
each case any documents incorporated by reference therein at such
time and all information contained in the final prospectus filed with
the Commission pursuant to Rule 424(b) of the Rules and Regulations
in accordance with Section 5(a) hereof and deemed to be a part of
the Registration Statements as of the Effective Time of the Primary
Registration Statement pursuant to paragraph (b) of Rule 430A of the
Rules and Regulations; and "Prospectus" means such final prospectus,
as first filed with the Commission pursuant to paragraph (1) or (4)
of Rule 424(b) of the Rules and Regulations. Reference made herein
to any Preliminary Prospectus or to the Prospectus shall be deemed
to refer to and include any documents incorporated by reference
therein pursuant to Item 12 of Form S-3 under the Securities Act, as
of the date of such Preliminary Prospectus or the Prospectus, as the
case may be, and any reference to any amendment or supplement to any
Preliminary Prospectus or the Prospectus shall be deemed to refer to
and include any document filed under the Securities Exchange Act of
1934 (the "Exchange Act") after the date of such Preliminary
Prospectus or the Prospectus, as the case may be, and incorporated
by reference in such Preliminary Prospectus or the Prospectus, as
the case may be. The Commission has not issued any order preventing
or suspending the use of any Preliminary Prospectus.
(b) The Primary Registration Statement conforms (and the Rule 462(b)
Registration Statement, if any, the Prospectus and any further
amendments or supplements to the Registration Statements or the
Prospectus, when they become effective or are filed with the
Commission, as the case may be, will conform) in all respects to the
requirements of the Securities Act and the Rules and Regulations and
do not and will not, as of the applicable effective date (as to the
Registration Statements and any amendment thereto) and as of the
applicable filing date (as to the Prospectus and any amendment or
supplement thereto) contain any untrue statement of a material fact or
omit to state any material fact required to be stated therein or
necessary to make the statements therein not misleading; provided
that no representation or warranty is made as to information
contained in or omitted from the Registration Statements or the
Prospectus in reliance upon and in conformity with written
information furnished to the Company through the Representatives by
or on behalf of any Underwriter specifically for inclusion therein.
(c) The documents incorporated by reference in the Prospectus, including
any amendment thereto, when they became effective or were filed with
the Commission, as the case may be, conformed in all material
respects to the requirements of the Exchange Act and the rules and
regulations of the Commission thereunder, and none of such documents
contained any untrue statement of a material fact or omitted to
state any material fact required to be stated therein or necessary
to make the statements therein not misleading; and any further
documents so filed and incorporated by reference in the Prospectus,
when such documents are filed with the Commission will conform in
all material respects to the requirements of the Exchange Act and
the rules and regulations of the Commission thereunder and will not
contain any untrue statement of a material fact or omit to state
any material fact required to be stated therein or necessary to make
the statements therein not misleading.
(d) The Company and each of its subsidiaries (as defined in Section 15)
have been duly incorporated and are validly existing as corporations
in good standing under the laws of their respective jurisdictions of
incorporation, are duly qualified to do business and are in good
standing as foreign corporations in each jurisdiction in which their
respective ownership or lease of property or the conduct of their
respective businesses requires such qualification (other than those
jurisdictions in which the failure to so qualify would not have a
material adverse effect on the Company or the Company and its
subsidiaries taken as a whole), and have all power and authority
necessary to own or hold their respective properties and to conduct
the businesses in which they
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are engaged; and none of the subsidiaries of the Company is a
"significant subsidiary", as such term is defined in Rule 405 of the
Rules and Regulations.
(e) The Company has an authorized capitalization as set forth in the
Prospectus, and all of the issued shares of capital stock of the
Company have been duly and validly authorized and issued, are fully
paid and non-assessable and conform to the description thereof
contained in the Prospectus; and all of the issued shares of capital
stock of each subsidiary of the Company have been duly and validly
authorized and issued and are fully paid and non-assessable and are
owned directly or indirectly by the Company, free and clear of all
liens, encumbrances, equities or claims (other than those existing
pursuant to the Existing Credit Facilities (as defined in the
Prospectus)).
(f) The unissued shares of the Stock to be issued and sold by the
Company to the Underwriters hereunder have been duly and validly authorized
and, when issued and delivered against payment therefor as provided
herein, will be duly and validly issued, fully paid and
non-assessable; and the Stock will conform to the description
thereof contained in the Prospectus.
(g) The execution, delivery and performance of this Agreement by the
Company and the consummation of the transactions contemplated hereby
will not conflict with or result in a breach or violation of any of
the terms or provisions of, or constitute a default under, any
indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which the Company or any of its
subsidiaries is a party or by which the Company or any of its
subsidiaries is bound or to which any of the properties or assets of
the Company or any of its subsidiaries is subject, nor will such
actions result in any violation of the provisions of the Amended
Articles of Incorporated or Amended Code of Regulations of the
Company or any of its subsidiaries or any statute or any order, rule
or regulation of any court or governmental agency or body having
jurisdiction over the Company or any of its subsidiaries or any of
their properties or assets; and except for the registration of the
Stock under the Securities Act and such consents, approvals,
authorizations, registrations or qualifications as may be required
under the Exchange Act and applicable state or foreign securities
laws in connection with the purchase and distribution of the Stock
by the Underwriters, no consent, approval, authorization or order of,
or filing or registration with, any such court or governmental
agency or body is required for the execution, delivery and
performance of this Agreement by the Company and the consummation of
the transactions contemplated hereby.
(h) Except for an intent to enter into an agreement or agreements with
USX Corporation and/or the United States Steel Corporation Plan for
Employee Pension Benefits (the "USX Pension Plan") with respect to
the shares of Common Stock owned by USX or contributed by USX to the
USX Pension Plan, such intent evidenced by an act of the Company's
Board of Directors authorizing such action, there are no contracts,
agreements or understandings between the Company and any person
granting such person the right to require the Company to file a
registration statement under the Securities Act with respect to any
securities of the Company owned or to be owned by such person or to
require the Company to include such securities in the securities
registered pursuant to the Registration Statements or in any
securities being registered pursuant to any other registration
statement filed by the Company under the Securities Act.
(i) Except as described in the Prospectus, the Company has not sold or
issued any shares of Common Stock during the six-month period
preceding the date of the Prospectus, including any sales pursuant
to Rule 144A under, or Regulations D or S of the Securities Act,
other than shares issued pursuant to employee benefit plans, stock
options plans or other employee compensation plans or pursuant to
outstanding options, rights or warrants.
(j) Neither the Company nor any of its subsidiaries has sustained, since
the date of the latest audited financial statements included or
incorporated by reference in the Prospectus, any material loss or
interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or
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decree, otherwise than as set forth or contemplated in the
Prospectus; and, since such date, there has not been any change in
the capital stock (other than the grant and exercise of options
pursuant to the Company's stock option plans) or changes in long-term
debt (other than under the Company's Existing Credit Facilities or
the New Credit Facility (as defined in the Prospectus)) of the
Company or any of its subsidiaries or any material adverse change, or
any development involving a prospective material adverse change, in
or affecting the management, financial position, shareholders'
equity, or results of operations or prospects of the Company and its
subsidiaries, otherwise than as set forth or contemplated in the
Prospectus.
(k) The financial statements (including the related notes and supporting
schedules) filed as part of the Registration Statements or included or
incorporated by reference in the Prospectus present fairly the financial
condition and results of operations of the entities purported to be
shown thereby, at the dates and for the periods indicated, and have
been prepared in conformity with generally accepted accounting
principles applied on a consistent basis throughout the periods
involved.
(l) Price Waterhouse LLP, who have certified certain financial
statements of the Company, whose report appears in the Prospectus and is
incorporated by reference therein and who have delivered the initial
letter referred to in Section 7(f) hereof, are independent public
accountants as required by the Securities Act and the Rules and
Regulations.
(m) The Company and each of its subsidiaries have good and sufficient
title in fee simple to all real property and good and sufficient
title to all personal property owned by them, in each case free and
clear of all liens, encumbrances and defects except those that (i)
are described in the Prospectus, (ii) exist as a result of the
Existing Credit Facilities, or (iii) do not materially affect the
value of such property and do not materially interfere with the use
made or proposed to be made of such property by the Company and its
subsidiaries; and all real property and buildings held under lease by
the Company and its subsidiaries are held by them under valid,
subsisting and enforceable leases, with such exceptions as are not
material and do not interfere with the use made or proposed to be
made of such property and buildings by the Company and its subsidiaries.
(n) The Company and each of its subsidiaries carry, or are covered by,
insurance in such amounts and covering such risks as is, in the
reasonable judgment of the Company, adequate for the conduct of their
respective businesses and the value of their respective properties.
(o) The Company and each of its subsidiaries own or possess adequate
rights to use all material patents, patent applications, trademarks,
service marks, trade names, trademark registrations, service mark
registrations, copyrights and licenses necessary for the conduct of
their respective businesses and have no reason to believe that the
conduct of their respective businesses will conflict with, and have
not received any notice of any claim of conflict with, any such
rights of others, in any material respect.
(p) Except as described in the Prospectus, there are no legal or
governmental proceedings pending to which the Company or any of its
subsidiaries is a party or of which any property or asset of the
Company or any of its subsidiaries is the subject which, if determined
adversely to the Company or any of its subsidiaries, might have a
material adverse effect on the consolidated financial position,
stockholders' equity, results of operations, business or prospects of
the Company and its subsidiaries; and to the best of the Company's
knowledge, no such proceedings are threatened or contemplated by
governmental authorities or threatened by others.
(q) The conditions for use of Form S-3, as set forth in the General
Instructions thereto, have been satisfied.
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(r) There are no contracts or other documents which are required to be
described in the Prospectus or filed as exhibits to either of the
Registration Statements by the Securities Act or by the Rules and
Regulations which have not been described in the Prospectus or filed as
exhibits to either of the Registration Statements or incorporated
therein by reference as permitted by the Rules and Regulations.
(s) No relationship, direct or indirect, exists between or among the
Company on the one hand, and the directors, officers, stockholders,
customers or suppliers of the Company on the other hand, which is
required to be described in the Prospectus which is not so described.
(t) No labor disturbance by the employees of the Company exists or, to
the knowledge of the Company, is imminent which might be expected to have a
material adverse effect on the consolidated financial position,
shareholders' equity, results of operations, business or prospects of
the Company and its subsidiaries.
(u) The Company is in compliance in all material respects with all
presently applicable provisions of the Employee Retirement Income
Security Act of 1974, as amended, including the regulations and
published interpretations thereunder ("ERISA"); no "reportable
event" (as defined in ERISA) has occurred with respect to any
"pension plan" (as defined in ERISA) for which the Company would
have any liability; the Company has not incurred and does not expect
to incur liability under (i) Title IV of ERISA with respect to
termination of, or withdrawal from, any "pension plan" or (ii)
Sections 412 or 4971 of the Internal Revenue Code of 1986, as amended,
including the regulations and published interpretations thereunder (the
"Code"); and each "pension plan" for which the Company would have any
liability that is intended to be qualified under Section 401(a) of
the Code is so qualified in all material respects and nothing has
occurred, whether by action or by failure to act, which would cause
the loss of such qualification.
(v) The Company has filed all federal, state and local income and
franchise tax returns required to be filed through the date hereof
and has paid all taxes due thereon, and no tax deficiency has been
determined adversely to the Company or any of its subsidiaries which
has had (nor does the Company have any knowledge of any tax
deficiency which, if determined adversely to the Company or any of
its subsidiaries, might have) a material adverse effect on the
consolidated financial position, shareholders' equity, results of
operations, business or prospects of the Company and its subsidiaries.
(w) The Company (i) makes and keeps accurate books and records and (ii)
maintains internal accounting controls which provide reasonable
assurance that (A) transactions are executed in accordance with
management's authorization, (B) transactions are recorded as
necessary to permit preparation of its financial statements and to
maintain accountability for its assets, (C) access to its assets is
permitted only in accordance with management's authorization and (D)
the reported accountability for its assets is compared with existing
assets at reasonable intervals.
(x) Neither the Company nor any of its subsidiaries (i) is in
violation of its charter or by-laws in any material respect, (ii) is in
default in any material respect, and no event has occurred which, with
notice or lapse of time or both, would constitute such a default, in
the due performance or observance of any term, covenant or condition
contained in any material indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument to which it is a party or
by which it is bound or to which any of its properties or assets is
subject or (iii) is in violation in any material respect of any law,
ordinance, governmental rule, regulation or court decree to which it
or its properties or assets may be subject or has failed to obtain
any material license, permit, certificate, franchise or other
governmental authorization or permit ("Permit") necessary to the
ownership of its properties or assets or to the conduct of its
business, or has received notice of any attempt to revoke or modify
any such Permit, or has any reason to believe that any such Permit
will not be granted or renewed.
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(y) Except as described in the Prospectus, there has been no storage,
disposal, generation, manufacture, refinement, transportation,
handling, treatment, discharge, emission, or any other release of
toxic wastes, medical wastes, hazardous wastes or hazardous
substances by the Company or any of its subsidiaries (or, to the
knowledge of the Company, any of their predecessors in interest or
any other entity for whose acts or omissions the Company or any
subsidiary is or may be liable) at, upon or from any of the
properties now or previously owned or leased by the Company or its
subsidiaries, or, to the knowledge of the Company, at, upon or from any
other properties, in violation of any applicable law, ordinance, rule
(including, without limitation, the rule of common law), regulation,
order, judgment, decree or permit or which would give rise to any
liability under any applicable law, ordinance, rule, regulation,
order, judgment, decree or permit, except for any violation or
liability which would not have, or could not be reasonably likely to
have, singularly or in the aggregate with all such violations and
remedial actions, a material adverse effect on the financial
position, stockholders' equity, results of operations or prospects
of the Company and its subsidiaries; except as disclosed in the
Prospectus, there has been no material spill, discharge, leak,
emission, injection, escape, dumping or release of any kind onto
such property or into the environment surrounding such property of
any toxic wastes, medical wastes, solid wastes, hazardous wastes,
hazardous substances or other substances, with respect to which the
Company or any of its subsidiaries have knowledge, except for any
such spill, discharge, leak, emission, injection, escape, dumping or
release which would not have or would not be reasonably likely to
have, singularly or in the aggregate with all such spills, discharges,
leaks, emissions, injections, escapes, dumpings and releases, a
material adverse effect on the financial position, stockholders'
equity, results of operations or prospects of the Company and its
subsidiaries; and the terms "hazardous wastes", "toxic wastes",
"hazardous substances" and "medical wastes" shall have the meanings
specified in any applicable local, state, federal and foreign laws
or regulations with respect to environmental protection.
2. Purchase of the Stock by the Underwriters. On the basis of the
representations and warranties contained in, and subject to the terms and
conditions of, this Agreement, the Company agrees to sell 4,000,000 shares of
the Firm Stock to the several Underwriters and each of the Underwriters,
severally and not jointly, agrees to purchase the number of shares of the Firm
Stock set opposite that Underwriter's name in Schedule 1 hereto.
In addition, the Company grants to the Underwriters an option to purchase up
to 600,000 shares of Option Stock. Such option is granted solely for the
purpose of covering over-allotments in the sale of Firm Stock and is
exercisable as provided in Section 4 hereof. Shares of Option Stock shall be
purchased severally for the account of the Underwriters in proportion to the
number of shares of Firm Stock set opposite the name of such Underwriters in
Schedule 1 hereto. The respective purchase obligations of each Underwriter
with respect to the Option Stock shall be adjusted by the Representatives so
that no Underwriter shall be obligated to purchase Option Stock other than in
100 share amounts.
The price of both the Firm Stock and any Option Stock shall be $_____ per
share.
The Company shall not be obligated to deliver any of the Stock to be
delivered on the First Delivery Date or the Second Delivery Date (as
hereinafter defined), as the case may be, except upon payment for all the Stock
to be purchased on such Delivery Date as provided herein.
3. Offering of Stock by the Underwriters.
Upon authorization by the Representatives of the release of the Firm Stock,
the several Underwriters propose to offer the Firm Stock for sale upon the
terms and conditions set forth in the Prospectus; provided, however, that no
Stock registered pursuant to the Rule 462(b) Registration Statement, if any,
shall be offered prior to the Effective Time thereof.
4. Delivery of and Payment for the Stock. Delivery of and payment for the
Firm Stock shall be made at the office of Simpson Thacher & Bartlett at 425
Lexington Avenue, New York, New York 10017, at 10:00
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A.M., New York City time, on the fourth full business day following the date of
this Agreement or at such other date or place as shall be determined by
agreement between the Representatives and the Company. This date and time are
sometimes referred to as the "First Delivery Date." On the First Delivery
Date, the Company shall deliver or cause to be delivered certificates
representing the Firm Stock to the Representatives for the account of each
Underwriter against payment to the Company of the purchase price by wire
transfer in same day funds, to an account specified by the Company. Time shall
be of the essence, and delivery at the time and place specified pursuant to
this Agreement is a further condition of the obligation of each Underwriter
hereunder. Upon delivery, the Firm Stock shall be registered in such names and
in such denominations as the Representatives shall request in writing not less
than two full business days prior to the First Delivery Date. For the purpose
of expediting the checking and packaging of the certificates for the Firm
Stock, the Company shall make the certificates representing the Firm Stock
available for inspection by the Representatives in New York, New York, not
later than 2:00 P.M., New York City time, on the business day prior to the
First Delivery Date.
At any time on or before the thirtieth day after the date of this Agreement,
the option granted in Section 2 may be exercised by written notice being given
to the Company by the Representatives. Such notice shall set forth the
aggregate number of shares of Option Stock as to which the option is being
exercised, the names in which the shares of Option Stock are to be registered,
the denominations in which the shares of Option Stock are to be issued and the
date and time, as determined by the Representatives, when the shares of Option
Stock are to be delivered; provided, however, that this date and time shall not
be earlier than the First Delivery Date nor earlier than the second business
day after the date on which the option shall have been exercised nor later than
the fifth business day after the date on which the option shall have been
exercised. The date and time the shares of Option Stock are delivered are
sometimes referred to as the "Second Delivery Date" and the First Delivery Date
and the Second Delivery Date are sometimes each referred to as a "Delivery
Date".
Delivery of and payment for the Option Stock shall be made at the place
specified in the first sentence of the first paragraph of this Section 4 (or at
such other place as shall be determined by agreement between the
Representatives and the Company) at 10:00 A.M., New York City time, on the
Second Delivery Date. On the Second Delivery Date, the Company shall deliver
or cause to be delivered the certificates representing the Option Stock to the
Representatives for the account of each Underwriter against payment to the
Company of the purchase price by wire transfer in same day funds to an account
specified by the Company. Time shall be of the essence, and delivery at the
time and place specified pursuant to this Agreement is a further condition of
the obligation of each Underwriter hereunder. Upon delivery, the Option Stock
shall be registered in such names and in such denominations as the
Representatives shall request in the aforesaid written notice. For the purpose
of expediting the checking and packaging of the certificates for the Option
Stock, the Company shall make the certificates representing the Option Stock
available for inspection by the Representatives in New York, New York, not
later than 2:00 P.M., New York City time, on the business day prior to the
Second Delivery Date.
5. Further Agreements of the Company. The Company agrees:
(a) To prepare the Rule 462(b) Registration Statement, if necessary, in
a form approved by the Representatives and to file such Rule 462(b)
Registration Statement with the Commission on the date hereof; to prepare
the Prospectus in a form approved by the Representatives and to file such
Prospectus pursuant to Rule 424(b) under the Securities Act not later than
10:00 A.M., New York City time, on the day following the execution and
delivery of this Agreement; to make no further amendment or any supplement
to the Registration Statements or to the Prospectus prior to the Second
Delivery Date except as permitted herein; to advise the Representatives,
promptly after the Company receives notice thereof, of the time when any
amendment to either Registration Statement has been filed or becomes
effective or any supplement to the Prospectus or any amended Prospectus has
been filed and to furnish the Representatives with copies thereof; to file
promptly all reports and any definitive proxy or information statements
required to be filed by the Company with the Commission pursuant to Section
13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to the date of the
Prospectus and for so long as the delivery of a prospectus is required in
connection with the offering or sale of the Stock; to advise the
Representatives, promptly after it receives notice thereof, of the issuance
by the Commission of any stop order or of any order
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preventing or suspending the use of any Preliminary Prospectus or the
Prospectus, of the suspension of the qualification of the Stock for offering
or sale in any jurisdiction, of the initiation or threatening of any
proceeding for any such purpose, or of any request by the Commission for the
amending or supplementing of the Registration Statements or the Prospectus or
for additional information; and, in the event of the issuance of any stop
order or of any order preventing or suspending the use of any Preliminary
Prospectus or the Prospectus or suspending any such qualification, to use
promptly its best efforts to obtain its withdrawal;
(b) To furnish promptly to each of the Representatives and to counsel for
the Underwriters a signed copy of each of the Registration Statements as
originally filed with the Commission, and each amendment thereto filed with
the Commission, including all consents and exhibits filed therewith;
(c) To deliver promptly to the Representatives in New York City such
number of the following documents as the Representatives shall request: (i)
conformed copies of the Registration Statements as originally filed with the
Commission and each amendment thereto (in each case excluding exhibits other
than this Agreement), (ii) each Preliminary Prospectus, the Prospectus (not
later than 10:00 A.M., New York City time, of the day following the
execution and delivery of this Agreement) and any amended or supplemented
Prospectus (not later than 10:00 A.M., New York City time, on the day
following the date of such amendment or supplement) and (iii) any document
incorporated by reference in the Prospectus (excluding exhibits thereto);
and, if the delivery of a prospectus is required at any time after the
Effective Time of the Primary Registration Statement in connection with the
offering or sale of the Stock (or any other securities relating thereto) and
if at such time any event shall have occurred as a result of which the
Prospectus as then amended or supplemented would include any untrue
statement of a material fact or omit to state any material fact necessary in
order to make the statements therein, in the light of the circumstances
under which they were made when such Prospectus is delivered, not
misleading, or, if for any other reason it shall be necessary to amend or
supplement the Prospectus or to file under the Exchange Act any document
incorporated by reference in the Prospectus in order to comply with the
Securities Act or the Exchange Act, to notify the Representatives and to
file such document and, upon their request, to prepare and furnish without
charge to each Underwriter and to any dealer in securities as many copies as
the Representatives may from time to time request of an amended or
supplemented Prospectus which will correct such statement or omission or
effect such compliance, and in case any Underwriter is required to deliver a
prospectus in connection with sales of any of the Stock at any time nine
months or more after the Effective Time of the Primary Registration
Statement, upon the request of the Representatives but at the expense of
such Underwriter, to prepare and deliver to such Underwriter as many copies
as the Representatives may from time to time request of an amended or
supplemented Prospectus complying with Section 10(a)(3) of the Securities
Act;
(d) To file promptly with the Commission any amendment to the Registration
Statements or the Prospectus or any supplement to the Prospectus that may,
in the judgment of the Company or the Representatives, be required by the
Securities Act or requested by the Commission;
(e) Prior to filing with the Commission any (i) amendment to either of the
Registration Statements or supplement to the Prospectus or any document
incorporated by reference in the Prospectus or (ii) any Prospectus pursuant
to Rule 424 of the Rules and Regulations, to furnish a copy thereof to the
Representatives and counsel for the Underwriters and allow the
Representatives and counsel for the Underwriters the opportunity to comment
on any such amendment, supplement or document incorporated by reference in
the Prospectus;
(f) As soon as practicable after the Effective Date of the Primary
Registration Statement, to make generally available to the Company's
security holders and to deliver to the Representatives an earnings statement
of the Company and its subsidiaries (which need not be audited) complying
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with Section 11(a) of the Securities Act and the Rules and Regulations
(including, at the option of the Company, Rule 158);
(g) For a period of five years following the Effective Date of the Primary
Registration Statement, to furnish to the Representatives copies of all
materials furnished by the Company to its shareholders and all public
reports and all reports and financial statements furnished on behalf of the
Company to the principal national securities exchange upon which the Common
Stock may be listed pursuant to requirements of or agreements with such
exchange or to the Commission pursuant to the Exchange Act or any rule or
regulation of the Commission thereunder;
(h) Promptly from time to time to take such action as the Representatives
may reasonably request to qualify the Stock for offering and sale under the
securities laws of such jurisdictions as the Representatives may request and
to comply with such laws so as to permit the continuance of sales and
dealings therein in such jurisdictions for as long as may be necessary to
complete the distribution of the Stock;
(i) Except as set forth in the Prospectus with respect to the USX Pension
Plan, for a period of 180 days from the date of this Agreement, not to,
directly or indirectly, offer for sale, sell or otherwise dispose of (or
enter into any transaction or device which is designed to, or could be
expected to, result in the disposition or purchase by any person at any time
in the future of) any shares of Common Stock (other than the Stock and
shares issued pursuant to employee benefit plans, stock option plans or
other employee compensation plans existing on the date hereof or pursuant to
currently outstanding options, warrants or rights), or sell or grant
options, rights or warrants with respect to any shares of Common Stock
(other than the grant of options pursuant to option plans existing on the
date hereof), without the prior written consent of the Representatives; and
to cause each executive officer and director of the Company to furnish to
the Representatives, prior to the First Delivery Date, a letter or letters,
in form and substance satisfactory to counsel for the Underwriters, pursuant
to which each such person shall agree not to, directly or indirectly, offer
for sale, sell or otherwise dispose of (or enter into any transaction or
device which is designed to, or could be expected to, result in the
disposition or purchase by any person at any time in the future of) any
shares of Common Stock for a period of 180 days from the date of this
Agreement without the prior written consent of the Representatives; provided
that, for Mr. L. Frederick Gieg, Jr., John H. Odle and Timothy G. Rupert,
the period described in the preceding clause shall be 90 days from the date
of this Agreement; and
(j) To apply the net proceeds from the sale of the Stock being sold by the
Company as set forth in the Prospectus.
6. Expenses. The Company agrees to pay (a) the costs incident to the
authorization, issuance, sale and delivery of the Stock and any taxes payable
in that connection; (b) the costs incident to the preparation, printing and
filing under the Securities Act of the Registration Statements and any
amendments and exhibits thereto; (c) the costs of distributing the Registration
Statements as originally filed and each amendment thereto and any
post-effective amendments thereof (including, in each case, exhibits), any
Preliminary Prospectus, the Prospectus and any amendment or supplement to the
Prospectus or any document incorporated by reference therein, all as provided
in this Agreement; (d) the costs of reproducing and distributing this
Agreement; (e) the costs of distributing the terms of agreement relating to the
organization of the underwriting syndicate and selling group to the members
thereof by mail, telex or other means of communication; (f) the filing fees
incident to securing any required review by the National Association of
Securities Dealers, Inc. of the terms of sale of the Stock; (g) any applicable
listing or other fees; (h) the fees and expenses of qualifying the Stock under
the securities laws of the several jurisdictions as provided in Section 5(h)
and of preparing, printing and distributing a Blue Sky Memorandum (including
related fees and expenses of counsel to the Underwriters); and (i) all other
costs and expenses incident to the performance of the obligations of the
Company under this Agreement; provided that, except as provided in this Section
6 and in Section 11, the Underwriters shall pay their own costs and expenses,
including the costs and expenses of their counsel, any
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transfer taxes on the Stock which they may sell and the expenses of advertising
any offering of the Stock made by the Underwriters.
7. Conditions of Underwriters' Obligations. The respective obligations of
the Underwriters hereunder are subject to the accuracy, when made and on each
Delivery Date, of the representations and warranties of the Company contained
herein, to the performance by the Company of its obligations hereunder, and to
each of the following additional terms and conditions:
(a) The Rule 462(b) Registration Statement, if any, and the Prospectus
shall have been timely filed with the Commission in accordance with Section
5(a); no stop order suspending the effectiveness of either of the
Registration Statements or any part thereof shall have been issued and no
proceeding for that purpose shall have been initiated or threatened by the
Commission; and any request of the Commission for inclusion of additional
information in either of the Registration Statements or the Prospectus or
otherwise and not understood by the Company to have been withdrawn shall
have been complied with.
(b) No Underwriter shall have discovered and disclosed to the Company on
or prior to such Delivery Date that either of the Registration Statements or
the Prospectus or any amendment or supplement thereto contains any untrue
statement of a fact which, in the opinion of Simpson Thacher & Bartlett,
counsel for the Underwriters, is material or omits to state any fact which,
in the opinion of such counsel, is material and is required to be stated
therein or is necessary to made the statements therein not misleading.
(c) All corporate proceedings and other legal matters incident to the
authorization, form and validity of this Agreement, the Stock, the
Registration Statements and the Prospectus, and all other legal matters
relating to this Agreement and the transactions contemplated hereby shall be
satisfactory in all respects to counsel for the Underwriters, and the
Company shall have furnished to such counsel all documents and information
that they may reasonably request to enable them to pass upon such matters.
(d) D.D. Sandman, General Counsel and Secretary of USX Corporation and
special counsel to the Company, shall have furnished to the Underwriters his
written opinion, as special counsel to the Company, addressed to the
Underwriters and dated such Delivery Date, in form and substance
satisfactory to the Underwriters, to the effect that:
(i) The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Ohio, is duly
qualified to do business and is in good standing as a foreign corporation
in each jurisdiction in which its ownership or lease of property or the
conduct of its business requires such qualification (other than those
jurisdictions in which the failure to so qualify would not have a material
adverse effect on the Company or the Company and its subsidiaries taken as
a whole), and has all power and authority necessary to own or hold its
respective properties and conduct the businesses in which it is engaged;
(ii) The Company has an authorized capitalization as set forth in the
Prospectus, and all of the issued shares of capital stock of the Company
(including the shares of Stock being delivered on such Delivery Date) have
been duly and validly authorized and issued, are fully paid and
non-assessable and conform to the description thereof contained in the
Prospectus;
(iii) There are no preemptive or other rights to subscribe for or to
purchase, nor any restriction upon the voting or transfer of, any shares of
the Stock pursuant to the Company's Amended Articles of Incorporation or
Amended Code of Regulations or any agreement or other instrument known to
such counsel;
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(iv) To such counsel's knowledge after due inquiry and other than as set
forth in the Prospectus, there are no legal or governmental proceedings
pending to which the Company or any of its subsidiaries is a party or of
which any property or asset of the Company or any of its subsidiaries is
the subject which, if determined adversely to the Company or any of its
subsidiaries, might have a material adverse effect on the consolidated
financial position, shareholders' equity or results of operations of the
Company and its subsidiaries; and, to such counsel's knowledge after due
inquiry, no such proceedings are threatened or contemplated by governmental
authorities or threatened by others;
(v) The Primary Registration Statement was declared effective under the
Securities Act as of the date and time specified in such opinion, the Rule
462(b) Registration Statement, if any, was filed with the Commission on the
date specified therein, the Prospectus was filed with the Commission
pursuant to the subparagraph of Rule 424(b) of the Rules and Regulations
specified in such opinion on the date specified therein and no stop order
suspending the effectiveness of either of the Registration Statements has
been issued and, to the knowledge of such counsel, no proceeding for that
purpose is pending or threatened by the Commission;
(vi) The Registration Statements, as of their respective Effective Dates,
and the Prospectus, as of its date, and any further amendments or
supplements thereto, as of their respective dates, made by the Company
prior to such Delivery Date (other than the financial statements and other
financial data contained therein, as to which such counsel need express no
opinion) complied as to form in all material respects with the requirements
of the Securities Act and the Rules and Regulations, and the documents
incorporated by reference in the Prospectus and any further amendment or
supplement to any such incorporated document made by the Company prior to
such Delivery Date (other than the financial statements and related
schedules therein, as to which such counsel need 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 Exchange Act and the rules and regulations of the Commission
thereunder;
(vii) To such counsel's knowledge after due inquiry, there are no
contracts or other documents which are required to be described in the
Prospectus or filed as exhibits to the Registration Statements by the
Securities Act or by the Rules and Regulations which have not been
described or filed as exhibits to the Registration Statements or
incorporated therein by reference as permitted by the Rules and
Regulations;
(viii) This Agreement has been duly authorized, executed and delivered by
the Company;
(ix) The issue and sale of the shares of Stock being delivered on such
Delivery Date by the Company and the compliance by the Company with all of
the provisions of this Agreement and the consummation of the transactions
contemplated hereby will not conflict with or result in a breach or
violation of any of the terms or provisions of, or constitute a default
under, any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument known to such counsel after due inquiry to which
the Company is a party or by which the Company or to which any of the
properties or assets of the Company is subject, nor will such actions
result in any violation of the provisions of the Amended Articles of
Incorporation or Amended Code of Regulations of the Company or any statute
or any order, rule or regulation known to such counsel of any court or
governmental agency or body having jurisdiction over the Company or any of
its properties or assets; and, except for the registration of the Stock
under the Securities Act
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and such consents, approvals, authorizations, registrations or
qualifications as may be required under the Exchange Act and applicable
state or foreign securities laws in connection with the purchase and
distribution of the Stock by the Underwriters, no consent, approval,
authorization or order of, or filing or registration with, any such court
or governmental agency or body is required for the execution, delivery
and performance of this Agreement by the Company and the consummation of
the transactions contemplated hereby; and
(x) To such counsel's knowledge after due inquiry (except for an intent
to enter into an agreement or agreements with USX Corporation and/or the
USX Pension Plan with respect to shares of Common Stock owned by USX or
contributed by USX to the USX Pension Plan, such intent evidenced by an act
of the Company's Board of Directors authorizing such action), there are no
contracts, agreements or understandings between the Company and any person
granting such person the right (other than rights which have been waived or
satisfied) to require the Company to file a registration statement under
the Securities Act with respect to any securities of the Company owned or
to be owned by such person or to require the Company to include such
securities in the securities registered pursuant to the Registration
Statements or in any securities being registered pursuant to any other
registration statement filed by the Company under the Securities Act.
In rendering such opinion, such counsel may state (i) that his opinion is
limited to matters governed by the Federal laws of the United States of
America and the laws of the State of Ohio and (ii) that the phrase "to such
counsel's knowledge after due inquiry", as used in such counsel's opinion,
means facts or other information known or which, on the basis of an
investigation reasonable under the circumstances (including, without
limitation, consultation with such other lawyer or lawyers in the Law
Department of the U.S. Steel Group of USX Corporation that such counsel
reasonably believes should be consulted), should have been known. Such
counsel shall also have furnished to the Representatives a written
statement, addressed to the Underwriters and dated such Delivery Date, in
form and substance satisfactory to the Representatives, to the effect that
(x) the Company is on a regular basis represented by the Law Department of
the U.S. Steel Group of USX Corporation and, with respect to litigation and
certain other matters, by other outside counsel and the Law Department of
the U.S. Steel Group has acted as counsel to the Company in connection with
previous financing transactions and has acted as counsel to the Company in
connection with the preparation of the Registration Statements, and (y)
based on the foregoing, no facts have come to the attention of such counsel
which lead him to believe that (I) the Registration Statements, as of their
respective Effective Dates, contained any untrue statement of a material
fact or omitted to state any material fact required to be stated therein or
necessary in order to make the statements therein not misleading, or that
the Prospectus contains any untrue statement of a material fact or omits to
state any material fact required to be stated therein or necessary in order
to make the statements therein, in light of the circumstances under which
they were made, not misleading or (II) any document incorporated by
reference in the Prospectus or any further amendment or supplement to any
such incorporated document made by the Company prior to such Delivery Date,
when they became effective or were filed with the Commission, as the case
may be, contained any untrue statement of a material fact or omitted to
state any material fact necessary in order to make the statements therein,
in light of the circumstances under which they were made, not misleading (in
each case, other than the financial statements and related schedules thereto
and statements made in the Prospectus under the caption "Certain United
States Tax Consequences to Non-United States Holders", as to which such
counsel need express no belief). The foregoing opinion and statement may be
qualified by a statement to the effect that such counsel does not assume any
responsibility for the accuracy, completeness or fairness of the statements
contained in the Registration Statements or the Prospectus except for the
statements made in the Prospectus under the caption "Description of Capital
Stock", insofar as such statements relate to the Stock and concern legal
matters.
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(e) J.T. Mills, Vice-President-Taxes of USX Corporation, shall have
furnished to the Representatives a letter addressed to the Underwriters and
dated such Delivery Date, in form and substance satisfactory to the
Representatives, to the effect that such counsel has reviewed the statements
in the Prospectus under the caption "Certain United States Tax Consequences
to Non-United States Holders" and, insofar as they are, or refer to,
statements of United States law or legal conclusions, such statements are
accurate in all material respects.
(f) With respect to the letter of Price Waterhouse LLP delivered to the
Representatives concurrently with the execution of this Agreement (the
"initial letter"), the Company shall have furnished to the Representatives a
letter (the "bring-down letter") of such accountants, addressed to the
Underwriters and dated such Delivery Date (i) confirming that they are
independent public accountants within the meaning of the Securities Act and
are in compliance with the applicable requirements relating to the
qualification of accountants under Rule 2-01 of Regulation S-X of the
Commission, (ii) stating, as of the date of the bring-down letter (or, with
respect to matters involving changes or developments since the respective
dates as of which specified financial information is given in the
Prospectus, as of a date not more than five days prior to the date of the
bring-down letter), the conclusions and findings of such firm with respect
to the financial information and other matters covered by the initial letter
and (iii) confirming in all material respects the conclusions and findings
set forth in the initial letter.
(g) The Company shall have furnished to the Representatives a certificate,
dated such Delivery Date, of its Chairman of the Board, its President or the
Senior Vice President-Commercial and its chief financial officer stating
that:
(i) The representations, warranties and agreements of the Company in
Section 1 are true and correct as of such Delivery Date; the Company has
complied with all its agreements contained herein; and the conditions set
forth in Sections 7(a) have been fulfilled;
(ii) They have carefully examined the Registration Statements and the
Prospectus and, to their knowledge, (A) the Registration Statements, as of
their respective Effective Dates, and the Prospectus, as of each of the
Effective Dates, did not include any untrue statement of a material fact
and did not omit to state any material fact required to be stated therein
or necessary to make the statements therein not misleading, and (B) since
the Effective Date of the Primary Registration Statement no event has
occurred which should have been set forth in a supplement or amendment to
either of the Registration Statements or the Prospectus; and
(iii) Neither the Company nor any of its subsidiaries has sustained
since the date of the latest audited financial statements included or
incorporated by reference in the Prospectus any material loss or
interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor dispute or
court or governmental action, order or decree, otherwise than as set forth
or contemplated in the Prospectus or since such date, except as
contemplated in the Prospectus, there has not been any change in the
capital stock (other than the grant and exercise of options pursuant to the
Company's stock option plans) or any changes in long-term debt (other than
under the Existing Credit Facilities or the New Credit Facility) of the
Company or any of its subsidiaries or any material adverse change, or any
development involving a prospective material adverse change, in or
affecting the financial position, shareholders' equity, results of
operations or prospects of the Company and its subsidiaries, otherwise than
as set forth or contemplated in the Prospectus.
(h) (i) Neither the Company nor any of its subsidiaries shall have
sustained since the date of the latest audited financial statements
included or incorporated by reference in the
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Prospectus any loss or interference with its business from fire, explosion,
flood or other calamity, whether or not covered by insurance, or from any
labor dispute or court or governmental action, order or decree, otherwise than
as set forth or contemplated in the Prospectus or (ii) since such date, except
as contemplated in the Prospectus, there shall not have been any change in the
capital stock (other than the grant and exercise of options pursuant to the
Company's stock option plans) or any changes in long-term debt (other than
under the Existing Credit Facilities or the New Credit Facility) of the
Company or any of its subsidiaries or any change, or any development involving
a prospective change, in or affecting the financial position, shareholders'
equity, results of operations or prospects of the Company and its
subsidiaries, otherwise than as set forth or contemplated in the Prospectus,
the effect of which, in any such case described in clause (i) or (ii), is, in
the judgment of the Representatives, so material and adverse as to make it
impracticable or inadvisable to proceed with the public offering or the
delivery of the Stock being delivered on such Delivery Date on the terms and
in the manner contemplated in the Prospectus.
(i) Subsequent to the execution and delivery of this Agreement there shall
not have occurred any of the following: (i) trading in securities generally
on the New York Stock Exchange or the American Stock Exchange or in the
over-the-counter market, or trading in any securities of the Company on any
exchange or in the over-the-counter market, shall have been suspended or
minimum prices shall have been established on any such exchange or such
market by the Commission, by such exchange or by any other regulatory body
or governmental authority having jurisdiction, (ii) a banking moratorium
shall have been declared by Federal or state authorities, (iii) the United
States shall have become engaged in hostilities, there shall have been an
escalation in hostilities involving the United States or there shall have
been a declaration of a national emergency or war by the United States or
(iv) there shall have occurred such a material adverse change in general
economic, political or financial conditions (or the effect of international
conditions on the financial markets in the United States shall be such) as
to make it, in the judgment of a majority in interest of the several
Underwriters, impracticable or inadvisable to proceed with the public
offering or delivery of the Stock being delivered on such Delivery Date on
the terms and in the manner contemplated in the Prospectus.
(j) The New York Stock Exchange, Inc. shall have approved the Stock for
listing, subject only to official notice of issuance.
(k) The New Credit Facility (as defined in the Prospectus) shall be
effective, and the conditions to borrowing thereunder satisfied, except only
for the payment of the purchase price to the Company for the Common Stock,
as contemplated herein on the First Delivery Date.
(l) The USX Pension Plan shall have furnished to the Representatives a
letter or letters, in form and substance reasonably satisfactory to counsel
for the Underwriters, pursuant to which the USX Pension Plan shall agree not
to, directly or indirectly, offer for sale, sell or otherwise dispose of (or
enter into any transaction or device which is designed to, or could be
expected to, result in the disposition of purchase by any person at any time
in the future of) any shares of Common Stock for 180 days from the date of
this Agreement without the prior written consent of the Representatives,
unless, as a result of intervening events, the United States Steel and
Carnegie Pension Fund, as trustee of the USX Pension Plan, determines that
compliance with such a restriction would violate its fiduciary duty to the
USX Pension Plan.
(m) USX Corporation shall have furnished to the Representatives a letter
or letters, in form and substance reasonably satisfactory to counsel for the
Underwriters, pursuant to which USX Corporation shall agree not to, directly
or indirectly, offer for sale, sell or otherwise dispose of (or enter into
any transaction or device which is designed to, or could be expected to,
result in the disposition of purchase by any person at any time in the
future of) any shares of Common Stock for 180 days from the date of this
Agreement without the prior written consent of the Representatives.
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All opinions, letters, evidence and certificates mentioned above or
elsewhere in this Agreement shall be deemed to be in compliance with the
provisions hereof only if they are in form and substance satisfactory to
counsel for the Underwriters.
8. Indemnification and Contribution.
(a) The Company shall indemnify and hold harmless each Underwriter, its
officers and employees and each person, if any, who controls any Underwriter
within the meaning of the Securities Act, from and against any loss, claim,
damage or liability, joint or several, or any action in respect thereof
(including, but not limited to, any loss, claim, damage, liability or action
relating to purchases and sales of Stock), to which that Underwriter, officer,
employee or controlling person may become subject, under the Securities Act or
otherwise, insofar as such loss, claim, damage, liability or action arises out
of, or is based upon, (i) any untrue statement or alleged untrue statement of a
material fact contained (A) in any Preliminary Prospectus, either of the
Registration Statements or the Prospectus, or in any amendment or supplement
thereto, or (B) in any blue sky application or other document prepared or
executed by the Company (or based upon any written information furnished by the
Company) specifically for the purpose of qualifying any or all of the Stock
under the securities laws of any state or other jurisdiction (any such
application, document or information being hereinafter called a "Blue Sky
Application"), or (ii) the omission or alleged omission to state in any
Preliminary Prospectus, either of the Registration Statements or the
Prospectus, or in any amendment or supplement thereto, or in any Blue Sky
Application any material fact required to be stated therein or necessary to
make the statements therein not misleading and shall reimburse each Underwriter
and each such officer, employee and controlling person promptly upon demand for
any legal or other expenses reasonably incurred by that Underwriter, officer,
employee or controlling person in connection with investigating or defending or
preparing to defend against any such loss, claim, damage, liability or action
as such expenses are incurred; provided, however, that the Company shall not be
liable in any such case to the extent that any such loss, claim, damage,
liability or action arises out of, or is based upon, any untrue statement or
alleged untrue statement or omission or alleged omission made in any
Preliminary Prospectus, the Registration Statement or the Prospectus, or in any
such amendment or supplement, or in any Blue Sky Application in reliance upon
and in conformity with the written information furnished to the Company through
the Representatives by or on behalf of any Underwriter specifically for
inclusion therein and described in Section 8(e). The foregoing indemnity
agreement is in addition to any liability which the Company may otherwise have
to any Underwriter or to any officer, employee or controlling person of that
Underwriter.
(b) Each Underwriter, severally and not jointly, shall indemnify and hold
harmless the Company, its officers and employees, each of its directors and
each person, if any, who controls the Company within the meaning of the
Securities Act, from and against any loss, claim, damage or liability, joint or
several, or any action in respect thereof, to which the Company or any such
director, officer or controlling person may become subject, under the
Securities Act or otherwise, insofar as such loss, claim, damage, liability or
action arises out of, or is based upon, (i) any untrue statement or alleged
untrue statement of a material fact contained (A) in any Preliminary
Prospectus, either of the Registration Statements or the Prospectus, or in any
amendment or supplement thereto, or (B) in any Blue Sky Application or (ii) the
omission or alleged omission to state in any Preliminary Prospectus, either of
the Registration Statements or the Prospectus, or in any amendment or
supplement thereto, or in any Blue Sky Application any material fact required
to be stated therein or necessary to make the statements therein not
misleading, but in each case only to the extent that the untrue statement or
alleged untrue statement or omission or alleged omission was made in reliance
upon and in conformity with the written information furnished to the Company
through the Representatives by or on behalf of that Underwriter specifically
for inclusion therein and described in Section 8(e), and shall reimburse the
Company and any such director, officer or controlling person for any legal or
other expenses reasonably incurred by the Company or any such director, officer
or controlling person in connection with investigating or defending or
preparing to defend against any such loss, claim, damage, liability or action
as such expenses are incurred. The foregoing indemnity agreement is in
addition to any liability which any Underwriter may otherwise have to the
Company or any such director, officer or controlling person.
(c) Promptly after receipt by an indemnified party under this Section 8 of
notice of any claim or the commencement of any action, the indemnified party
shall, if a claim in respect thereof is to be made against the indemnifying
party under this Section 8, notify the indemnifying party in writing of the
claim or the
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commencement of that action; provided, however, that the failure to notify the
indemnifying party shall not relieve it from any liability which it may have
under this Section 8 except to the extent it has been materially prejudiced by
such failure and, provided further, that the failure to notify the indemnifying
party shall not relieve it from any liability which it may have to an
indemnified party otherwise than under this Section 8. If any such claim or
action shall be brought against an indemnified party, and it shall notify the
indemnifying party thereof, the indemnifying party shall be entitled to
participate therein and, to the extent that it wishes, jointly with any other
similarly notified indemnifying party, to assume the defense thereof with
counsel satisfactory to the indemnified party. After notice from the
indemnifying party to the indemnified party of its election to assume the
defense of such claim or action, the indemnifying party shall not be liable to
the indemnified party under this Section 8 for any legal or other expenses
subsequently incurred by the indemnified party in connection with the defense
thereof other than reasonable costs of investigation; provided, however, that
any indemnified party shall have the right to employ separate counsel in any
such action and to participate in the defense thereof but the fees and expenses
of such counsel shall be at the expense of such indemnified party unless (i)
the employment thereof has been specifically authorized by the indemnifying
party in writing, (ii) the named parties to any such proceeding (including any
impleaded parties) include both the indemnifying party and the indemnified
party and representation of both parties by the same counsel would be
inappropriate due to actual or potential differing interests between them or
(iii) the indemnifying party has failed to assume the defense of such action
and employ counsel reasonably satisfactory to the indemnified party, in which
case, if such indemnified party notifies the indemnifying party in writing that
it elects to employ separate counsel at the expense of the indemnifying party,
the indemnifying party shall not have the right to assume the defense of such
action on behalf of such indemnified party, it being understood, however, that
the indemnifying party shall not, in connection with any one such action or
separate but substantially similar or related actions in the same jurisdiction
arising out of the same general allegations or circumstances, be liable for the
reasonable fees and expenses of more than one separate firm of attorneys at any
time for all such indemnified parties, which firm shall be designated in
writing by the Representatives, if the indemnified parties under this Section 8
consist of any Underwriter or any of their respective controlling persons, or
by the Company, if the indemnified parties under this Section 8 consist of the
Company or any of the Company's directors, officers or controlling persons.
Each indemnified party, as a condition of the indemnity agreements contained in
Sections 8(a) and 8(b), shall use its best efforts to cooperate with the
indemnifying party in the defense of any such action or claim. No indemnifying
party shall (i) without the prior written consent of the indemnified parties
(which consent shall not be unreasonably withheld), settle or compromise or
consent to the entry of any judgment with respect to any pending or threatened
claim, action, suit or proceeding in respect of which indemnification or
contribution may be sought hereunder (whether or not the indemnified parties
are actual or potential parties to such claim or action) unless such
settlement, compromise or consent includes an unconditional release of each
indemnified party from all liability arising out of such claim, action, suit or
proceeding, or (ii) be liable for any settlement of any such action effected
without its written consent (which consent shall not be unreasonably withheld),
but if settled with its written consent or if there be a final judgment of the
plaintiff in any such action, the indemnifying party agrees to indemnify and
hold harmless any indemnified party from and against any loss of liability by
reason of such settlement or judgment.
(d) If the indemnification provided for in this Section 8 shall for any
reason be unavailable to or insufficient to hold harmless an indemnified party
under Section 8(a) or 8(b) in respect of any loss, claim, damage or liability,
or any action in respect thereof, referred to therein, then each indemnifying
party shall, in lieu of indemnifying such indemnified party, contribute to the
amount paid or payable by such indemnified party as a result of such loss,
claim, damage or liability, or action in respect thereof, (i) in such
proportion as shall be appropriate to reflect the relative benefits received by
the Company on the one hand and the Underwriters on the other from the offering
of the Stock or (ii) if the allocation provided by clause (i) above is not
permitted by applicable law, in such proportion as is appropriate to reflect
not only the relative benefits referred to in clause (i) above but also the
relative fault of the Company on the one hand and the Underwriters on the other
with respect to the statements or omissions which resulted in such loss, claim,
damage or liability, or action in respect thereof, 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 with respect to such
offering shall be deemed to be in the same proportion as the total net proceeds
from the offering of the Stock purchased under this Agreement (before deducting
expenses) received by the Company on the one hand, and the total underwriting
discounts and commissions received by the Underwriters with respect to the
shares of the Stock purchased under this Agreement, on the other hand, bear to
the total gross proceeds from the offering of the shares of the Stock under
this Agreement, in each case as set forth in
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the table on the cover page of the Prospectus. The relative fault shall be
determined by reference to whether the 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 the Underwriters, the intent of the
parties and their relative 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 contributions
pursuant to this Section 8(d) were to be determined by pro rata allocation
(even if the Underwriters were treated as one entity for such purpose) or by
any other method of allocation which does not take into account the equitable
considerations referred to herein. The amount paid or payable by an
indemnified party as a result of the loss, claim, damage or liability, or
action in respect thereof, referred to above in this Section 8(d) shall be
deemed to include, for purposes of this Section 8(d), any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this Section 8(d), no Underwriter shall be required to contribute
any amount in excess of the amount by which the total price at which the Stock
underwritten by it and distributed to the public was offered to the public
exceeds the amount of any damages which such Underwriter has otherwise paid or
become liable to pay by reason of any untrue or alleged untrue statement or
omission or alleged omission. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) shall be entitled
to contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations to contribute as provided in
this Section 8(d) are several in proportion to their respective underwriting
obligations and not joint.
(e) The Underwriters severally confirm that the statements with respect to
the public offering of the Stock set forth on the cover page of, and under the
caption "Underwriting" in, the Prospectus are correct and constitute the only
information furnished in writing to the Company by or on behalf of the
Underwriters specifically for inclusion in the Registration Statements and the
Prospectus.
9. Defaulting Underwriters.
If, on either Delivery Date, any Underwriter defaults in the performance of
its obligations under this Agreement, the remaining non-defaulting
Underwriters shall be obligated to purchase the Stock which the defaulting
Underwriter agreed but failed to purchase on such Delivery Date in the
respective proportions which the number of shares of the Firm Stock set
opposite the name of each remaining non-defaulting Underwriter in Schedule 1
hereto bears to the total number of shares of the Firm Stock set opposite the
names of all the remaining non-defaulting Underwriters in Schedule 1 hereto;
provided, however, that the remaining non-defaulting Underwriters shall not be
obligated to purchase any of the Stock on such Delivery Date if the total
number of shares of the Stock which the defaulting Underwriter or Underwriters
agreed but failed to purchase on such date exceeds 9.09% of the total number of
shares of the Stock to be purchased on such Delivery Date, and any remaining
non-defaulting Underwriter shall not be obligated to purchase more than 110% of
the number of shares of the Stock which it agreed to purchase on such Delivery
Date pursuant to the terms of Section 2. If the foregoing maximums are
exceeded, the remaining non-defaulting Underwriters, or those other
underwriters satisfactory to the Representatives who so agree, shall have the
right, but shall not be obligated, to purchase, in such proportion as may be
agreed upon among them, all the Stock to be purchased on such Delivery Date.
If the remaining Underwriters or other underwriters satisfactory to the
Representatives do not elect to purchase the shares which the defaulting
Underwriter or Underwriters agreed but failed to purchase on such Delivery
Date, this Agreement (or, with respect to the Second Delivery Date, the
obligation of the Underwriters to purchase, and of the Company to sell, the
Option Stock) shall terminate without liability on the part of any non-
defaulting Underwriter or the Company except that the Company will continue to
be liable for the payment of expenses to the extent set forth in Sections 6 and
11. As used in this Agreement, the term "Underwriter" includes, for all
purposes of this Agreement unless the context requires otherwise, any party not
listed in Schedule 1 hereto who, pursuant to this Section 9, purchases Firm
Stock which a defaulting Underwriter agreed but failed to purchase.
Nothing contained herein shall relieve a defaulting Underwriter of any
liability it may have to the Company for damages caused by its default. If
other underwriters are obligated or agree to purchase the Stock of a defaulting
or withdrawing Underwriter, either the Representatives or the Company may
postpone the First Delivery Date for up to seven full business days in order to
effect any changes that in the opinion of counsel for the Company
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or counsel for the Underwriters may be necessary in the Registration Statement,
the Prospectus or in any other document or arrangement.
10. Termination.
The obligations of the Underwriters hereunder may be terminated by the
Representatives by notice given to and received by the Company prior to
delivery of and payment for the Firm Stock if, prior to that time, any of the
events described in Sections 7(h) and 7(i) shall have occurred or if the
Underwriters shall decline to purchase the Stock for any reason permitted under
this Agreement.
11. Reimbursement of Underwriters' Expenses. If (a) the Company shall fail
to tender the Stock for delivery to the Underwriters for any reason permitted
under this Agreement, or (b) the Underwriters shall decline to purchase the
Stock for any reason permitted under this Agreement (including the termination
of this Agreement pursuant to Section 10), the Company shall reimburse the
Underwriters for the fees and expenses of their counsel and for such other
out-of-pocket expenses as shall have been incurred by them in connection with
this Agreement and the proposed purchase of the Stock, and upon demand the
Company shall pay the full amount thereof to the Representatives. If this
Agreement is terminated pursuant to Section 9 by reason of the default of one
or more Underwriters, the Company shall not be obligated to reimburse such
expenses to any defaulting Underwriter.
12. Notices, etc. All statements, requests, notices and agreements
hereunder shall be in writing, and:
(a) if to the Underwriters, shall be delivered or sent by mail, telex or
facsimile transmission to Lehman Brothers Inc., Three World Financial
Center, New York, New York 10285, Attention: Syndicate Department (Fax:
212-528-8822);
(b) if to the Company, shall be delivered or sent by mail, telex or
facsimile transmission to the address of the Company set forth in the
Primary Registration Statement, Attention: Timothy G. Rupert (Fax:
330-544-7701);
provided, however, that any notice to an Underwriter pursuant to Section 8(c)
shall be delivered or sent by mail, telex or facsimile transmission to such
Underwriter at its address set forth in its acceptance telex to the
Representatives, which address will be supplied to any other party hereto by
the Representatives upon request. Any such statements, requests, notices or
agreements shall take effect at the time of receipt thereof. The Company shall
be entitled to act and rely upon any request, consent, notice or agreement
given or made on behalf of the Underwriters by Lehman Brothers Inc. on behalf
of the Representatives.
13. Persons Entitled to Benefit of Agreement. This Agreement shall inure to
the benefit of and be binding upon the Underwriters, the Company, and their
respective successors. This Agreement and the terms and provisions hereof are
for the sole benefit of only those persons, except that (A) the
representations, warranties, indemnities and agreements of the Company
contained in this Agreement shall also be deemed to be for the benefit of the
officers and employees of each Underwriter and the person or persons, if any,
who control each Underwriter within the meaning of Section 15 of the Securities
Act and (B) the indemnity agreement of the Underwriters contained in Section
8(b) of this Agreement shall be deemed to be for the benefit of directors,
officers and employees of the Company and any person controlling the Company
within the meaning of Section 15 of the Securities Act. Nothing in this
Agreement is intended or shall be construed to give any person, other than the
persons referred to in this Section 13, any legal or equitable right, remedy or
claim under or in respect of this Agreement or any provision contained herein.
14. Survival. The respective indemnities, representations, warranties and
agreements of the Company and the Underwriters contained in this Agreement or
made by or on behalf of them, respectively, pursuant to this Agreement, shall
survive the delivery of and payment for the Stock and shall remain in full
force and effect, regardless of any investigation made by or on behalf of any
of them or any person controlling any of them.
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15. Definition of the Terms "Business Day" and "Subsidiary". For purposes
of this Agreement, (a) "business day" means any day on which the New York Stock
Exchange, Inc. is open for trading and (b) "subsidiary" has the meaning set
forth in Rule 405 of the Rules and Regulations.
16. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF NEW YORK.
17. Counterparts. This Agreement may be executed in one or more
counterparts and, if executed in more than one counterpart, the executed
counterparts shall each be deemed to be an original but all such counterparts
shall together constitute one and the same instrument.
18. Headings. The headings herein are inserted for convenience of reference
only and are not intended to be part of, or to affect the meaning or
interpretation of, this Agreement.
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If the foregoing correctly sets forth the agreement between the Company and
the Underwriters, please indicate your acceptance in the space provided for
that purpose below.
Very truly yours,
RMI TITANIUM COMPANY
By ________________________________________
Name:
Title:
Accepted:
LEHMAN BROTHERS INC.
SALOMON BROTHERS INC
For themselves as Underwriters
and as Representatives of the
several Underwriters named
in Schedule 1 hereto
By LEHMAN BROTHERS INC.
By ________________________________________
Authorized Representative
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SCHEDULE 1
Number of
Underwriters Shares
------------ ---------
Lehman Brothers Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Salomon Brothers Inc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
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Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,000,000
=========