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EXHIBIT 1.1
Union Texas Petroleum Holdings, Inc.
Common Stock
(par value $.05 per share)
Underwriting Agreement
(U.S. Version)
________ __, 199_
SALOMON BROTHERS INC
CS FIRST BOSTON CORPORATION
GOLDMAN, SACHS & CO.
MERRILL LYNCH & CO.
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
As representatives of the
several Underwriters named
in Schedule I hereto
c/o SALOMON BROTHERS INC
Seven World Trade Center
New York, New York 10048
Dear Sirs:
Petroleum Associates, L.P. and KKR Partners II, L.P.
(together, the "Selling Stockholders"), propose, subject to the terms and
conditions stated herein, to sell to the Underwriters named in Schedule I
hereto (the "Underwriters") an aggregate of 8,000,000 shares (the "Firm
Shares") and, at the election of the Underwriters, up to 1,200,000 additional
shares (the "Optional Shares") of Common Stock, par value $.05 per share (the
"Stock"), of Union Texas Petroleum Holdings, Inc., a Delaware corporation (the
"Company"). The Firm Shares and the Optional Shares which the Underwriters
elect to purchase pursuant to Section 2 hereof are collectively referred to
herein as the "Shares".
It is understood and agreed to by all parties that the Company
and the Selling Stockholders are concurrently entering into an agreement (the
"International Underwriting Agreement") providing for the sale by the Selling
Stockholders of up to a total of 2,300,000 shares of Stock (the "International
Shares"), including the over-allotment option thereunder, through arrangements
with certain underwriters outside the United States (the "International
Underwriters"), for whom Salomon Brothers International Limited, CS First
Boston Limited, Goldman Sachs International and Merrill Lynch
International Limited are acting as representatives. Anything herein or
therein to the contrary notwithstanding, the respective closings under this
Agreement and the International Underwriting Agreement are hereby expressly
made conditional on one another. The Underwriters hereunder and the
International Underwriters are simultaneously entering into an Agreement
between U.S. and International Underwriting Syndicates (the "Agreement between
Syndicates") which provides, among other things, for the transfer of shares of
Stock between the two syndicates. Two forms of prospectus are to be used in
connection with the offering and sale of shares of Stock contemplated by the
foregoing, one relating to the Shares hereunder and the other relating to the
International Shares. The latter form of prospectus will be identical
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to the former except for certain substitute pages as included in the
registration statement and amendments thereto as mentioned below. Except as
used in Sections 2, 3, 4, 9 and 11 herein, and except as the context may
otherwise require, references hereinafter to the Shares shall include all the
shares of Stock which may be sold pursuant to either this Agreement or the
International Underwriting Agreement, and references herein to any prospectus
whether in preliminary or final form, and whether as amended or supplemented,
shall include both the U.S. and the international versions thereof.
1. (a) The Company represents and warrants to, and agrees
with, each of the Underwriters that:
(i) A registration statement in respect of the Shares
has been filed with the Securities and Exchange Commission (the
"Commission"); such registration statement and any post-effective
amendment thereto, each in the form heretofore delivered to you, and,
excluding exhibits thereto but including all documents incorporated by
reference in the prospectus contained therein, to you for each of the
other Underwriters, have been declared effective by the Commission in
such form; no other document with respect to such registration
statement or document incorporated by reference therein has heretofore
been filed with the Commission; and no stop order suspending the
effectiveness of such registration statement has been issued and no
proceeding for that purpose has been initiated or threatened by the
Commission (any preliminary prospectus included in such registration
statement or filed with the Commission pursuant to Rule 424(a) of the
rules and regulations of the Commission under the Securities Act of
1933, as amended (the "Act"), being hereinafter called a "Preliminary
Prospectus"; the various parts of such registration statement,
including all exhibits thereto and including (i) the information
contained in the form of final prospectus filed with the Commission
pursuant to Rule 424(b) under the Act in accordance with Section 5(a)
hereof and deemed by virtue of Rule 430A under the Act to be part of
the registration statement at the time it was declared effective and
(ii) the documents incorporated by reference in the prospectus
contained in the registration statement at the time such part of the
registration statement became effective, each as amended at the time
such part of the registration statement became effective, being
hereinafter called the "Registration Statement"; the final
prospectus, in the form first filed with the Commission pursuant to
Rule 424(b) under the Act, being hereinafter called the "Prospectus";
any reference herein to any Preliminary Prospectus or the Prospectus
being deemed to refer to and include the documents incorporated by
reference therein pursuant to Item 12 of Form S-3 under the Act, as of
the date of such Preliminary Prospectus or Prospectus, as the case may
be; any reference to any amendment or supplement to any Preliminary
Prospectus or the Prospectus being deemed to refer to and include any
documents filed after the date of such Preliminary Prospectus or
Prospectus, as the case may be, under the Securities Exchange Act of
1934, as amended (the "Exchange Act"), and incorporated by reference
in such Preliminary Prospectus or Prospectus, as the case may be; and
any reference to any amendment to the Registration Statement shall
be deemed to refer to and include any annual report of the Company
filed pursuant to Section 13(a) or 15(d) of the Exchange Act after the
effective date of the Registration Statement that is incorporated by
reference in the Registration Statement);
(ii) No order preventing or suspending the use of any
Preliminary Prospectus has been issued by the Commission, and each
Preliminary Prospectus, at the time of filing thereof, conformed in
all material respects to the requirements of the Act and the published
rules and regulations of the Commission thereunder, and did 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, in the light of the circumstances under which they
were made, not misleading; provided, however, that this representation
and warranty shall not apply to any statements or omissions made in
reliance upon and in conformity with information furnished in writing
to the Company by an Underwriter through you expressly for use therein
or by either Selling Stockholder expressly for use in the preparation
of the answers therein to Item 7 of Form S-3;
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(iii) The documents incorporated by reference in the
Prospectus, 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 Act or the Exchange Act, as applicable, and
the published rules and regulations of the Commission thereunder, and
none of such documents contained an untrue statement of a material
fact or omitted to state a material fact required to be stated therein
or necessary to make the statements therein not misleading; and any
further documents so filed and incorporated by reference in the
Prospectus or any further amendment or supplement thereto, when such
documents become effective or are filed with the Commission, as the
case may be, will conform in all material respects to the requirements
of the Act or the Exchange Act, as applicable, and the rules and
regulations of the Commission thereunder and will not contain an
untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading;
(iv) The Registration Statement conforms, and the
Prospectus and any further amendments or supplements to the
Registration Statement or the Prospectus will conform, in all material
respects to the requirements of the Act and the published rules and
regulations of the Commission thereunder and do not and will not, as
of the applicable effective date as to the Registration Statement and
any amendment thereto and as of the applicable filing date as to the
Prospectus and any amendment or supplement thereto, 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; provided, however, that this representation and warranty
shall not apply to any statements or omissions made in reliance upon
and in conformity with information furnished in writing to the Company
by an Underwriter through you expressly for use therein or by either
Selling Stockholder expressly for use in the preparation of the
answers therein to Item 7 of Form S-3;
(v) None of the Company or any of its subsidiaries or,
to the best of the Company's knowledge, Unimar Company, a Texas
general partnership ("Unimar"), has sustained since the date of the
latest audited financial statements included or incorporated by
reference in the 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, which loss or interference is material to the
Company and its subsidiaries taken as a whole; and, since the
respective dates as of which information is given in the Registration
Statement and the Prospectus, there has not been any change in the
capital stock (other than (i) any shares of capital stock of the
Company sold upon exercise of a subscription, option or warrant or the
conversion of a security outstanding on the date of this Agreement,
(ii) any shares of such capital stock, or other securities convertible
or exercisable or exchangeable for such shares, in either case issued
pursuant to any employee stock option or benefit plan of the Company
existing on the date of this Agreement and (iii) stock repurchases in
accordance with the Company's publicly announced stock repurchase
program) or any increase of more than $35,000,000 in the consolidated
short-term or long-term debt of the Company or any material adverse
change, or any development involving a prospective material adverse
change, in or affecting the general affairs, management, financial
position, stockholders' equity or results of operations of the Company
and its subsidiaries taken as a whole, otherwise than as set forth or
contemplated in the Prospectus;
(vi) The Company has been duly incorporated and is
validly existing as a corporation in good standing under the laws of
the State of Delaware, with power and authority (corporate and other)
to own its properties and conduct its business as described in the
Prospectus, and has been duly qualified as a foreign corporation for
the transaction of business and is in good standing under the laws of
each other jurisdiction in which it owns or leases properties, or
conducts any business, so as to require such qualification, or is
subject to no material liability or disability by reason of the
failure to be so qualified in any such jurisdiction; each subsidiary
of the Company identified in Annex II hereto (collectively, the
"Material Subsidiaries") has been duly incorporated and is validly
existing as a corporation in good standing under the laws of its
jurisdiction of incorporation; Unimar has been duly formed and is
validly existing as a partnership under the laws of the State of
Texas;
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and the Company does not have any subsidiary that is a "significant
subsidiary" (within the meaning of the published rules and regulations
of the Commission under the Act) that is not identified in Annex II
hereto;
(vii) 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 Material Subsidiary have been duly and validly
authorized and issued and are fully paid and non-assessable, and all
of such shares of capital stock and 50% of the equity interests in
Unimar (except for directors' qualifying shares and shares held by
third parties solely to satisfy local law requirements and except as
set forth in the Prospectus) are owned directly or indirectly by the
Company, free and clear of all liens, encumbrances, equities or
claims;
(viii) The Shares have been duly and validly authorized
and issued, are fully paid and non-assessable and conform to the
description of the Stock contained in the Prospectus;
(ix) The compliance by the Company with all of the
provisions of this Agreement and the International Underwriting
Agreement and the consummation of the transactions herein and therein
contemplated 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 or, to the best of the Company's knowledge, Unimar is a
party or by which the Company or any of its subsidiaries or, to the
best of the Company's knowledge, Unimar is bound or to which any
of the property or assets of the Company or any of its subsidiaries
or, to the best of the Company's knowledge, Unimar is subject, or
any statute or any order, rule or regulation of any court or
governmental agency or body having jurisdiction over the Company, any
of its subsidiaries or, to the best of the Company's knowledge, Unimar
or any of their properties (excluding conflicts, breaches, violations
and defaults that, individually or in the aggregate, will not have any
material adverse effect on the general affairs, management, financial
position, stockholders' equity, results of operations or prospects of
the Company and its subsidiaries taken as a whole), nor will any such
action result in any violation of the provisions of the Restated
Certificate of Incorporation or By-laws of the Company; and no
consent, approval, authorization, order, registration or qualification
of or with any such court or governmental agency or body is required
for the consummation by the Company of the transactions contemplated
by this Agreement and the International Underwriting Agreement, except
the registration under the Act of the Shares and such consents,
approvals, authorizations, registrations or qualifications as may be
required under state or foreign securities or Blue Sky laws in
connection with the purchase and distribution of the Shares by the
Underwriters and the International Underwriters;
(x) 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 or, to the best of the Company's knowledge,
Unimar is a party or of which any property of the Company or any of
its subsidiaries or, to the best of the Company's knowledge, Unimar is
the subject which, if determined adversely to the Company or any of
its subsidiaries or Unimar, would individually or in the aggregate
have a material adverse effect on the consolidated financial
position, stockholders' equity or results of operations of the Company
and its subsidiaries taken as a whole; and, to the best of the
Company's knowledge, no such proceedings are threatened or
contemplated by governmental authorities or threatened by others;
(xi) Price Waterhouse LLP, who have certified certain
financial statements of the Company and its subsidiaries, are
independent public accountants as required by the Act and the rules
and regulations of the Commission thereunder;
(xii) The Shares have been approved for listing on the
New York Stock Exchange and the Pacific Stock Exchange;
(xiii) The Company is not an "investment company" within
the meaning of the Investment Company Act of 1940, as amended (the
"Investment Company Act"), and the published rules and regulations of
the Commission thereunder, and the offer and sale of the Shares will
not subject the Company to registration under, or result in a
violation of, the Investment Company Act;
(xiv) Neither the Company nor any of its affiliates does
business with the government of Cuba or with any person or affiliate
located in Cuba within the meaning of Section 517.075, Florida
Statutes.
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(b) Each Selling Stockholder represents and warrants to, and
agrees with, each of the Underwriters and the Company that:
(i) No consent, approval, authorization, order,
registration or qualification of or with any court or governmental
agency or body is required for the consummation by such Selling
Stockholder of the transactions contemplated by this Agreement and the
International Underwriting Agreement, except the registration under
the Act of the Shares and such consents, approvals, authorizations,
registrations or qualifications as may be required under state or
foreign securities or Blue Sky laws in connection with the purchase
and distribution of the Shares by the Underwriters and the
International Underwriters; and such Selling Stockholder has full
power and authority to enter into this Agreement and the International
Underwriting Agreement and to sell, assign, transfer and deliver the
Shares hereunder and under the International Underwriting Agreement;
(ii) The sale of the Shares hereunder and under the
International Underwriting Agreement and the compliance by such
Selling Stockholder with all of the provisions of this Agreement and
the International Underwriting Agreement and the consummation of the
transactions herein and therein contemplated 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 statute, any indenture, mortgage,
deed of trust, loan agreement or other agreement or instrument to
which such Selling Stockholder is a party or by which such Selling
Stockholder is bound, or to which any of the property or assets of
such Selling Stockholder is subject, or any statute or any order,
rule or regulation of any court or governmental agency having
jurisdiction over such Selling Stockholder or its property (excluding
conflicts, breaches, violations and defaults that, individually or in
the aggregate, will not materially adversely affect such Selling
Stockholder's ability to perform its obligations under this Agreement
or the International Underwriting Agreement), nor will any such action
result in any violation of the provisions of the partnership agreement
or other constituent documents, if any, relating to such Selling
Stockholder;
(iii) Such Selling Stockholder has, and immediately prior
to each Time of Delivery (as defined in Section 4 hereof) such Selling
Stockholder will have, good and valid title to the Shares to be sold
at such Time of Delivery hereunder and under the International
Underwriting Agreement, free and clear of all liens, encumbrances,
equities or claims (other than the interests of the several
Underwriters under this Agreement and of the International
Underwriters under the International Underwriting Agreement); and, upon
delivery of such Shares and payment therefor pursuant hereto and
thereto, good and valid title to such Shares, free and clear of all
liens, encumbrances, equities or claims, will pass to the several
Underwriters and the International Underwriters;
(iv) No offering, sale, contract to sell, or other
disposition of any Stock or any securities exchangeable or convertible
into or exercisable for any Stock will be made within 90 days after
the date of the Prospectus, directly or indirectly, by such Selling
Stockholder, otherwise than hereunder or under the International
Underwriting Agreement or with your written consent or as described in
the Prospectus;
(v) Such Selling Stockholder has not taken and will not
take, directly or indirectly, any action which is designed to or which
has constituted or which might reasonably be expected to cause or
result in stabilization or manipulation of the price of any security
of the Company to facilitate the sale or resale of the Shares; and
(vi) To the extent that any statements or omissions made
in the Registration Statement, any Preliminary Prospectus, the
Prospectus or any amendment or supplement thereto are made in reliance
upon and in conformity with written information furnished to the
Company by such Selling Stockholder expressly for use therein, such
Preliminary Prospectus and the Registration Statement did not, and the
Prospectus and any further amendments or supplements to the
Registration Statement and the Prospectus, when they become effective
or are filed with the Commission, as the case may be, will not,
contain any untrue statement of a material fact or omit
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to state any material fact required to be stated therein or necessary
to make the statements therein not misleading.
In order to document the Underwriters' compliance with the
reporting and withholding provisions of the Tax Equity and Fiscal
Responsibility Act of 1982 with respect to the transactions herein
contemplated, each Selling Stockholder agrees to deliver to you prior to or at
the First Time of Delivery (as hereinafter defined) a properly completed and
executed United States Treasury Department Form W-9 (or other applicable form
or statement specified by Treasury Department regulations in lieu thereof).
2. Subject to the terms and conditions herein set forth, (a)
each Selling Stockholder agrees, severally and not jointly, to sell to the
several Underwriters the number of Firm Shares set forth opposite such Selling
Stockholder's name in Schedule II hereto, and each of the Underwriters agrees,
severally and not jointly, to purchase from the Selling Stockholders at a
purchase price per share of $_____ the number of Firm Shares set forth opposite
the name of such Underwriter in Schedule I hereto; each Underwriter shall be
obligated to purchase from each Selling Stockholder at a purchase price per
share of $_____, that number of Firm Shares (to be adjusted by you so as to
eliminate fractional shares) determined by multiplying the aggregate number of
Firm Shares to be sold by such Selling Stockholder as set forth opposite its
name in Schedule II hereto by a fraction, the numerator of which is the
aggregate number of Firm Shares to be purchased by such Underwriter as set
forth opposite the name of such Underwriter in Schedule I hereto and the
denominator of which is the aggregate number of Firm Shares to be purchased by
all of the Underwriters from both of the Selling Stockholders hereunder and (b)
in the event and to the extent that the Underwriters shall exercise the
election to purchase Optional Shares as provided below, each Selling
Stockholder agrees, severally and not jointly, to sell to each of the
Underwriters, and each of the Underwriters agrees, severally and not jointly,
to purchase from the Selling Stockholders, at the purchase price per share set
forth in clause (a) of this Section 2, that portion of the number of Optional
Shares as to which such election shall have been exercised (to be adjusted by
you so as to eliminate fractional shares) determined by multiplying the number
of Optional Shares set forth opposite such Selling Stockholder's name on
Schedule II hereto by a fraction the numerator of which is the maximum number
of Optional Shares which such Underwriter is entitled to purchase as set forth
opposite the name of such Underwriter in Schedule I hereto and the denominator
of which is the maximum number of the Optional Shares which all of the
Underwriters are entitled to purchase hereunder.
The Selling Stockholders hereby grant to the Underwriters the
right to purchase at their election up to 1,200,000 Optional Shares, at the
purchase price per share set forth in the paragraph above, for the sole purpose
of covering over-allotments in the sale of the Firm Shares. Any such election
to purchase Optional Shares may be exercised by written notice from you to the
Selling Stockholders, given within a period of 30 calendar days after the date
of this Agreement and setting forth the aggregate number of Optional Shares to
be purchased and the date on which such Optional Shares are to be delivered, as
determined by you but in no event earlier than the First Time of Delivery (as
defined in Section 4 hereof) or, unless you and the Selling Stockholders
otherwise agree in writing, earlier than two or later than ten business days
after the date of such notice.
3. Upon the authorization by you of the release of the Firm
Shares, the several Underwriters propose to offer the Firm Shares for sale upon
the terms and conditions set forth in the Prospectus.
4. Certificates in definitive form for the Shares to be
purchased by each Underwriter hereunder, and in such denominations and
registered in such names as Salomon Brothers Inc may request upon at least
forty-eight hours' prior notice to the Company and the Selling Stockholders,
shall be delivered by or on behalf of each Selling Stockholder to you for the
account of such Underwriter, against payment by such Underwriter or on its
behalf of the purchase price therefor by certified or official bank check or
checks, payable to the order of such Selling Stockholder, in New York Clearing
House funds, all at the office of Salomon Brothers Inc, Seven World Trade
Center, New York, New York, or through the facilities of The Depository Trust
Company. The time and date of such delivery and payment shall be, with respect
to the Firm Shares, 9:30 a.m., New York time, on ________ __, 199_ or such
other time and date as you, the Company and the Selling Stockholders may agree
upon in writing, and, with respect to the Optional Shares, 9:30 a.m., New York
time, on the date specified by you in the written notice given by you of the
Underwriters' election to purchase such Optional Shares, or such other time and
date as you, the Company and the Selling
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Stockholders may agree upon in writing. Such time and date for delivery of the
Firm Shares is herein called the "First Time of Delivery," such time and date
for delivery of the Optional Shares, if not the First Time of Delivery, is
herein called the "Second Time of Delivery", and each such time and date for
delivery is herein called a "Time of Delivery." Such certificates will be made
available for checking and packaging at least twenty-four hours prior to each
Time of Delivery at such office of Salomon Brothers Inc.
5. The Company agrees with each of the Underwriters and each
of the Selling Stockholders:
(a) To prepare the Prospectus in a form approved by you and
the Selling Stockholders and to file such Prospectus pursuant to Rule
424(b) under the Act not later than the Commission's close of business
on the second business day following the execution and delivery of
this Agreement, or, if applicable, such earlier time as may be
required by Rule 430A(a)(3) under the Act; to make no further
amendment or any supplement to the Registration Statement or
Prospectus after the date of this Agreement and prior to the Second
Time of Delivery (or, if there is no Second Time of Delivery, the
expiration of the Underwriters' option pursuant to Section 2 hereof)
which shall be reasonably disapproved by you or the Selling
Stockholders promptly after reasonable notice thereof; to advise you
and the Selling Stockholders, promptly after it receives notice
thereof, of the time when the Registration Statement, or any amendment
thereto, has been filed or becomes effective or any supplement to the
Prospectus or any amended Prospectus has been filed and to furnish you
and the Selling Stockholders 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 Shares; to advise you
and the Selling Stockholders, promptly after it receives notice
thereof, of the issuance by the Commission of any stop order or of any
order preventing or suspending the use of any Preliminary Prospectus
or prospectus, of the suspension of the qualification of the Shares
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 Statement or 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
prospectus or suspending any such qualification, to use promptly its
best efforts to obtain its withdrawal;
(b) Promptly from time to time to take such action as you may
reasonably request to qualify the Shares for offering and sale under
the securities laws of such jurisdictions as you 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 Shares, provided that in
connection therewith the Company shall not be required to qualify as a
foreign corporation or to file a general consent to service of process
in any jurisdiction;
(c) To furnish the Underwriters with copies of the Prospectus
in such quantities as you may from time to time reasonably request,
and, if the delivery of a prospectus is required in the judgment of
counsel for the Underwriters at any time prior to the expiration of
nine months after the time of issue of the Prospectus in
connection with the offering or sale of the Shares and if at such time
any event shall have occurred as a result of which the Prospectus as
then amended or supplemented would include an 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 during
such same period 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 Act or the Exchange Act, to
notify you and upon your request to file such document and to prepare
and furnish without charge to each Underwriter and to any dealer in
securities as many copies as you may from time to time reasonably
request of an amended Prospectus or a supplement to the 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 Shares at any time
nine months or more after the time of issue of the Prospectus, upon
your request but at the expense
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of such Underwriter, to prepare and deliver to such Underwriter as
many copies as you may request of an amended or supplemented
Prospectus complying with Section 10(a)(3) of the Act;
(d) To make generally available to its securityholders as
soon as practicable, but in any event not later than eighteen months
after the effective date of the Registration Statement (as defined in
Rule 158(c) under the Act), an earnings statement of the Company and
its subsidiaries (which need not be audited) complying with Section
11(a) of the Act and the rules and regulations of the Commission
thereunder (including at the option of the Company Rule 158);
(e) During the period beginning from the date hereof and
continuing to and including the date 90 days after the date of the
Prospectus, the Company will not, and will obtain the agreement of
each of its executive officers that they will not, offer, sell,
contract to sell or otherwise dispose of (other than pursuant to stock
option, other incentive benefit or savings plans existing, or on the
conversion, exchange or exercise of convertible, exchangeable or
exercisable securities outstanding, on the date of this Agreement) any
Stock or securities convertible or exchangeable into or exercisable
for Stock, without your prior written consent or as described in the
Prospectus;
(f) To furnish to its stockholders as soon as practicable
after the end of each fiscal year an annual report (including a
balance sheet and statements of income, stockholders' equity and cash
flows of the Company and its consolidated subsidiaries certified by
independent public accountants) and, as soon as practicable after the
end of each of the first three quarters of each fiscal year (beginning
with the fiscal quarter ending after the effective date of the
Registration Statement), consolidated summary financial information of
the Company and its subsidiaries for such quarter in reasonable
detail; and
(g) During a period of three years from the effective date of
the Registration Statement, to furnish to you copies of all reports or
other communications (financial or other) furnished to stockholders,
and deliver to you (i) as soon as they are available, copies of any
reports and financial statements furnished to or filed with the
Commission or any national securities exchange on which any class of
securities of the Company is listed; and (ii) such additional
information concerning the business and financial condition of the
Company as you may from time to time reasonably request (such
financial statements to be on a consolidated basis to the extent the
accounts of the Company and its subsidiaries are consolidated in
reports furnished to its stockholders generally or to the Commission).
6. The Company covenants and agrees with the several
Underwriters that it will pay or cause to be paid the following: (i) the fees,
disbursements and expenses of the Company's counsel and accountants in
connection with the registration of the Shares under the Act and all other
expenses in connection with the preparation, printing and filing of the
Registration Statement, any Preliminary Prospectus and the Prospectus and
amendments and supplements thereto and the mailing and delivering of copies
thereof to the Underwriters and dealers; (ii) the cost of printing or producing
any Agreement among Underwriters, this Agreement, the International
Underwriting Agreement, the Agreement between Syndicates, any Selling
Agreements, the Blue Sky Memorandum and any other documents in connection with
the offering, purchase, sale and delivery of the Shares; (iii) all expenses in
connection with the qualification of the Shares for offering and sale under
state securities laws as provided in Section 5(b) hereof, including the fees
and disbursements of counsel for the Underwriters in connection with such
qualification and in connection with the Blue Sky survey; (iv) the filing fees
incident to securing any required review by the National Association of
Securities Dealers, Inc. of the terms of the sale of the Shares; (v) the cost
of preparing stock certificates; (vi) the cost and charges of any transfer
agent or registrar; (vii) all other costs and expenses incident to the
performance of its obligations hereunder which are not otherwise specifically
provided for in this Section, other than transfer taxes; and (viii) the
reasonable fees and expenses of Latham & Watkins, counsel to the Selling
Stockholders.
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Salomon Brothers Inc agrees to advance any applicable New York State stock
transfer tax, and each Selling Stockholder agrees to reimburse Salomon Brothers
Inc for associated carrying costs in respect of the Shares sold by such Selling
Stockholder if such tax payment is not rebated on the day of payment and for
any portion of such tax payment not rebated. It is understood, however, that,
except as provided in this Section, Section 8 and Section 11 hereof, the
Underwriters will pay all of their own costs and expenses, including the fees
of their counsel, stock transfer taxes on resale of any of the Shares by them,
and any advertising expenses connected with any offers they may make. It is
further understood that the Underwriters will not be responsible for any costs
or expenses incident to the performance of the Selling Stockholders'
obligations hereunder, including any fees or expenses of counsel for the
Selling Stockholders and, except as provided above in this Section 6, any
expenses or taxes incident to the sale and delivery of the Shares by each
Selling Stockholder to the Underwriters hereunder. The Company and the Selling
Stockholders agree that nothing contained in this Section 6 shall be construed
to modify or supersede such rights and obligations as set forth in the Amended
and Restated Registration Rights Agreement, dated as of September 30, 1987,
among Union Texas Petroleum Holdings, Inc., the predecessor to Allied Signal,
Inc., and the Selling Stockholders and the letter, dated April 20, 1995, from
the Selling Stockholders to the Company.
7. The obligations of each Selling Stockholder hereunder to
sell and deliver Shares at a Time of Delivery shall be subject, in its
discretion, to the conditions set forth in Clauses (a), (c), (e) and (i)
(with respect to, in the case of the condition set forth in clause (i) below,
the obligations of the Company thereunder) below. The obligations of the
Underwriters hereunder, as to the Shares to be delivered at each Time of
Delivery, shall be subject, in their discretion, to the condition that all
representations and warranties and other statements of the Company and of each
Selling Stockholder herein are, at and as of such Time of Delivery, true and
correct, the condition that the Company and each Selling Stockholder shall have
performed all of their respective obligations hereunder theretofore to be
performed, and the following additional conditions:
(a) The Prospectus shall have been filed with the Commission
pursuant to Rule 424(b) within the applicable time period prescribed
for such filing by the rules and regulations under the Act and in
accordance with Section 5(a) hereof; no stop order suspending the
effectiveness of the Registration Statement or any part thereof shall
have been issued and no proceeding for that purpose shall have been
initiated or threatened by the Commission; and all requests for
additional information on the part of the Commission shall have been
complied with to your reasonable satisfaction;
(b) Simpson Thacher & Bartlett, counsel for the Underwriters,
shall have furnished to you such opinion or opinions, dated such Time
of Delivery, with respect to the incorporation of the Company, the
validity of the Shares being delivered at such Time of Delivery, the
Registration Statement, the Prospectus, and other related matters as
you may reasonably request, and such counsel shall have received such
papers and information as they may reasonably request to enable them
to pass upon such matters;
(c) Andrews & Kurth L.L.P., counsel for the Company, shall
have furnished to you and each Selling Stockholder their written
opinion, dated such Time of Delivery, in form and substance
satisfactory to you, 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 Delaware, with requisite corporate
power and authority to own its properties and conduct its
business as described in the Prospectus;
(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 being delivered at such Time of Delivery) have been
duly and validly authorized and issued and are fully paid and
non-assessable; and the Shares conform to the description of
the Stock contained in the Prospectus;
(iii) The Company has been duly qualified as a
foreign corporation for the transaction of business and is in
good standing under the laws of each other jurisdiction
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in which it owns or leases a material amount of properties, or
conducts any material business, so as to require such
qualification, or is subject to no material liability or
disability by reason of failure to be so qualified in any such
jurisdiction (such counsel being entitled to rely in respect
of matters of fact upon certificates of public officials or
officers of the Company, provided that such counsel shall
state that they believe that both you and they are justified
in relying upon such certificates);
(iv) Each Material Subsidiary has been duly
incorporated and is validly existing as a corporation in good
standing under the laws of its jurisdiction of incorporation;
to the best of such counsel's knowledge after reasonable
investigation, Unimar has been duly formed and is validly
existing as a partnership under the laws of the State of
Texas; and all of the issued shares of capital stock of each
Material Subsidiary have been duly and validly authorized and
issued and are fully paid and non-assessable, and (except for
directors' qualifying shares and shares held by third parties
solely to satisfy local law requirements and except as
otherwise set forth in the Prospectus), to the best of such
counsel's knowledge after reasonable investigation and except
as set forth in a schedule to such counsel's opinion, all of
such shares of capital stock and 50% of the equity interests
in Unimar are owned directly or indirectly by the Company,
free and clear of all liens, encumbrances, equities or claims
within the meaning of the Uniform Commercial Code (such
counsel being entitled to (A) state that the opinion in this
clause relating to the ownership of capital stock and equity
interests is based solely on a review of the corporate records
of the Company and its subsidiaries and the records of Unimar,
the certificate or certificates representing such shares of
capital stock and evidence of such equity interests in Unimar
and a certificate or certificates in respect of matters of
fact as to ownership of and liens, encumbrances, equities or
claims on such shares of capital stock and equity interests,
provided that such counsel shall state that they believe that
both you and they are justified in relying upon such
certificate or certificates and (B) rely in respect of matters
of fact upon certificates of public officials or officers of
the Company or its subsidiaries furnished to you at such Time
of Delivery, provided that such counsel shall state that they
believe that both you and they are justified in relying upon
such certificates);
(v) To the best of such counsel's knowledge
after reasonable investigation, other than as set forth in the
Prospectus, there is no pending or threatened action, suit or
proceeding before any court or any governmental agency or body
or any arbitrator involving the Company, any Material
Subsidiary or Unimar required to be disclosed in the
Registration Statement that is not adequately disclosed
therein;
(vi) This Agreement and the International
Underwriting Agreement have been duly authorized, executed and
delivered by the Company;
(vii) The compliance by the Company with all of
the provisions of this Agreement and the International
Underwriting Agreement and the consummation of the
transactions herein and therein contemplated will not result
in any violation of the Restated Certificate of Incorporation
or By-laws of the Company and, to the best of such counsel's
knowledge after reasonable investigation, such action will not
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 Material
Subsidiaries or, to the best of the Company's knowledge,
Unimar is a party or by which the Company or any of its
Material Subsidiaries or, to the best of such counsel's
knowledge, Unimar is bound or to which any of the property or
assets of the Company or any of its Material Subsidiaries or,
to the best of such counsel's knowledge, Unimar is subject, or
any statute or any order, rule or regulation known to such
counsel
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of any court or governmental agency or body having
jurisdiction over the Company, any of its Material
Subsidiaries or, to the best of such counsel's knowledge,
Unimar or any of their properties (excluding breaches,
violations and defaults that, individually or in the
aggregate, will not have any material adverse effect on the
general affairs, management, financial position, stockholders'
equity, results of operations or prospects of the Company and
its subsidiaries taken as a whole);
(viii) No consent, approval, authorization, order,
registration or qualification of or with any such court or
governmental agency or body having jurisdiction over the
Company is required for the consummation by the Company of the
transactions contemplated by this Agreement and the
International Underwriting Agreement, except the registration
under the Act of the Shares, and such consents, approvals,
authorizations, registrations or qualifications as may be
required under state or foreign securities or Blue Sky laws in
connection with the purchase and distribution of the Shares by
the Underwriters and the International Underwriters;
(ix) The statements made in the Prospectus under
the captions "Description of Capital Stock" and "Certain
United States Tax Consequences to Non-U.S. Holders", insofar
as such statements constitute summaries of the legal matters
and documents referred to therein, fairly present the
information called for with respect to such legal matters and
documents and fairly summarize such legal matters and
documents;
(x) The documents incorporated by reference in
the Prospectus or any further amendment or supplement thereto
made by the Company prior to such Time of Delivery (other than
the financial statements and related schedules and engineering
and statistical data 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 Act or
the Exchange Act, as applicable, and the published rules and
regulations of the Commission thereunder; and
(xi) The Registration Statement and the
Prospectus and any further amendments and supplements thereto
made by the Company prior to such Time of Delivery (other than
the financial statements and related schedules and engineering
and statistical data therein, as to which such counsel need
express no opinion) comply as to form in all material respects
with the requirements of the Act and the published rules and
regulations of the Commission thereunder.
Such counsel shall state that, although they do not assume any
responsibility for the accuracy, completeness or fairness of the
statements contained in any of the documents referred to in subclause
(x) of this Clause (c) or in the Registration Statement or the
Prospectus (except as and to the extent described in subclause (ix) of
this Clause (c)), they have no reason to believe that (i) any of the
documents referred to in subclause (x) of this Clause (c) when such
documents became effective or were so filed, as the case may be,
contained, in the case of a registration statement which became
effective under the Act, 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, in the
case of other documents which were filed under the Exchange Act with
the Commission, an untrue statement of a material fact, or omitted to
state a material fact required to be stated therein or necessary in
order to make the statements therein, in the light of the
circumstances under which they were made when such documents were so
filed, not misleading; or (ii) as of its effective date, the
Registration Statement
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or any further amendment thereto made by the Company prior to such
Time of Delivery (other than the financial statements and related
schedules therein, as to which such counsel need express no opinion or
belief) 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, as of its date,
the Prospectus or any further amendment or supplement thereto made by
the Company prior to such Time of Delivery (other than the financial
statements and related schedules therein, as to which such counsel
need express no opinion or belief) contained an untrue statement of a
material fact or omitted to state a material fact necessary to make
the statements therein, in the light of the circumstances under which
they were made, not misleading or that, as of such Time of Delivery,
either the Registration Statement or the Prospectus or any further
amendment or supplement thereto made by the Company prior to such Time
of Delivery (other than the financial statements and related schedules
therein, as to which such counsel need express no opinion or belief)
contains an untrue statement of a material fact or omits to state a
material fact necessary to make the statements therein, in the light
of the circumstances under which they were made, not misleading; and
they do not know of any amendment to the Registration Statement
required to be filed or of any contracts or other documents of a
character required to be filed as an exhibit to the Registration
Statement or required to be incorporated by reference into the
Prospectus or required to be described in the Registration Statement
or the Prospectus which are not filed or incorporated by reference or
described as required.
In rendering the opinions referred to in subclauses (ii)
(other than with respect to authorized capitalization), (iii), (iv),
(v), (vii) and (viii) of this Clause (c), such counsel may rely upon
an opinion of Newton W. Wilson, III, Esq., General Counsel, Vice
President-Administration and Secretary of the Company, furnished to
you at such Time of Delivery, provided that such counsel shall state
that they believe that both you and they are justified in relying upon
such opinion.
In rendering such opinion, such counsel may state that
they express no opinion as to the laws of any jurisdiction other than
the Federal laws of the United States, the laws of the State of New
York and the State of Texas and the General Corporation Law of the
State of Delaware.
(d) Latham & Watkins, counsel for each of the Selling
Stockholders, shall have furnished to you their written opinion, dated
such Time of Delivery, in form and substance satisfactory to you, to
the effect that:
(i) Each Selling Stockholder has been duly
formed and is validly existing as a partnership under the laws
of the State of Delaware; this Agreement and the International
Underwriting Agreement have been duly executed and delivered
by each Selling Stockholder; and the sale of the Shares
hereunder and thereunder and the compliance by each Selling
Stockholder with all of the provisions of this Agreement and
the International Underwriting Agreement and the consummation
of the transactions herein and therein contemplated will not
result in any violation of the respective Partnership
Agreement or other constituent documents, if any, relating to
each Selling Stockholder nor will such action result in a
breach or violation of any terms or provisions of, or
constitute a default under, any statute, any indenture,
mortgage, deed of trust, loan agreement or other agreement or
instrument known to such counsel to which either Selling
Stockholder is a party or by which either Selling Stockholder
is bound or to which any of the property or assets of either
Selling Stockholder is subject, or any order, rule or
regulation known to such counsel of any court or governmental
agency or body having jurisdiction over either Selling
Stockholder or the property of either Selling Stockholder
(excluding breaches, violations and defaults that,
individually or in the aggregate, will not materially
adversely affect such Selling Stockholder's ability to perform
its obligations under this Agreement or the International
Underwriting Agreement);
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(ii) No consent, approval, authorization or
order of any court or governmental agency or body is required
for the consummation of the transactions contemplated by this
Agreement and the International Underwriting Agreement in
connection with the sale of the Shares hereunder and under the
International Underwriting Agreement except such as have been
obtained under the Act and such as may be required under state
or foreign securities or Blue Sky laws in connection with the
purchase and distribution of such Shares by the Underwriters
and the International Underwriters;
(iii) Immediately prior to such Time of Delivery
each Selling Stockholder had good and valid title to the
Shares to be sold at such Time of Delivery by such Selling
Stockholder under this Agreement and the International
Underwriting Agreement, free and clear of all liens,
encumbrances, equities or adverse claims, within the meaning
of the Uniform Commercial Code (such counsel being entitled
to state that the opinion in this clause is based solely on a
review of the partnership records of such Selling Stockholder,
the certificate or certificates representing such Shares and a
certificate in respect of matters of fact as to ownership of
and liens, encumbrances, equities or claims on the Shares,
provided that such counsel shall state that they believe that
both you and they are justified in relying upon such
certificate or certificates) and full right, power and
authority to sell, assign, transfer and deliver the Shares
hereunder and thereunder; and
(iv) Assuming that each of the several
Underwriters purchasing Shares to be sold pursuant to this
Agreement and the International Underwriting Agreement have
purchased such Shares in good faith and without notice of any
lien, encumbrance, equity or any other adverse claim within
the meaning of the Uniform Commercial Code, the delivery of
certificates for the Shares pursuant to this Agreement and the
International Underwriting Agreement will pass valid and
marketable title to such Shares to each of the several
Underwriters who have purchased such Shares, free and clear of
all liens, encumbrances, equities or adverse claims within the
meaning of the Uniform Commercial Code.
In rendering such opinion, such counsel may state that they
express no opinion as to the laws of any jurisdiction other than the
Federal laws of the United States, the laws of the State of New York
and the General Corporation Law of the State of Delaware.
(e) On the effective date of the Registration Statement and
the effective date of the most recently filed post-effective
amendment to the Registration Statement and also at each Time of
Delivery, Price Waterhouse shall have furnished to you a letter or
letters, dated the respective date of delivery thereof, in form and
substance satisfactory to you, to the effect set forth in Annex I
hereto;
(f) (i) None of the Company or any of its subsidiaries or
Unimar shall have sustained since the date of the latest audited
financial statements included or incorporated by reference in the
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, which loss or interference is material to the Company and
its subsidiaries taken as a whole, and (ii) since the respective dates
as of which information is given in the Prospectus there shall not
have been any change in the capital stock (other than (i) any shares
of capital stock of the Company sold upon the exercise of a
subscription, option or warrant or the conversion of a security
outstanding on the date of this Agreement, (ii) any shares of such
capital stock, or other securities convertible or exercisable or
exchangeable for such shares, in either case issued pursuant to any
employee stock option or benefit plan of the Company existing on the
date of this Agreement and (iii) stock repurchases in accordance with
the Company's publicly announced stock repurchase program) or any
increase of more than $35,000,000 in the consolidated short-term or
long-term debt of the Company or any change, or any development
involving a prospective change, in or affecting the general affairs,
management, financial position, stockholders' equity or results of
operations of the Company and
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its subsidiaries taken as a whole, 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 your judgment so material and
adverse as to make it impracticable or inadvisable to proceed with the
public offering or the delivery of the Shares being delivered at such
Time of Delivery on the terms and in the manner contemplated in the
Prospectus;
(g) On or after the date hereof (i) no downgrading shall have
occurred in the rating accorded the Company's debt securities by any
"nationally recognized statistical rating organization," as that term
is defined by the Commission for purposes of Rule 436(g)(2) under the
Act and (ii) no such organization shall have publicly announced
that it has under surveillance or review, with possible negative
implications, its rating of any of the Company's debt securities
(other than Standard & Poor's Corporation's "negative outlook" on its
rating of the Company's debt securities, which outlook was publicly
announced prior to the date hereof);
(h) On or after the date hereof there shall not have occurred
any of the following: (i) a suspension or material limitation in
trading in securities generally on the New York Stock Exchange; (ii) a
general moratorium on commercial banking activities in New York
declared by either Federal or New York State authorities; or (iii) the
outbreak or escalation of hostilities involving the United States or
the declaration by the United States of a national emergency or war if
the effect of any such event specified in this Clause (iii) in your
judgment makes it impracticable or inadvisable to proceed with the
public offering or the delivery of the Shares being delivered at such
Time of Delivery on the terms and in the manner contemplated in the
Prospectus; and
(i) The Company and each Selling Stockholder shall have
furnished or caused to be furnished to you at such Time of Delivery
certificates of the Company (executed by appropriate officers of the
Company) and of such Selling Stockholder, respectively, satisfactory
to you as to the accuracy of the representations and warranties of the
Company and such Selling Stockholder, respectively, herein at and as
of such Time of Delivery, as to the performance by the Company and
such Selling Stockholder of all of their respective obligations
hereunder to be performed at or prior to such Time of Delivery, and as
to such other matters as you may reasonably request, and the Company
shall have furnished or caused to be furnished certificates as to the
matters set forth in subsections (a) and (f) of this Section, and as
to such other matters as you may reasonably request.
8. (a) The Company will indemnify and hold harmless each
Underwriter against any losses, claims, damages or liabilities, joint or
several, to which such Underwriter may become subject, under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions
in respect thereof) arise out of or are based upon an untrue statement or
alleged untrue statement of a material fact contained in any Preliminary
Prospectus, the Registration Statement or the Prospectus, or any amendment or
supplement thereto, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, and will reimburse
each Underwriter for any legal or other expenses reasonably incurred by such
Underwriter in connection with investigating or defending any such action or
claim 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
or liability arises out of or is based upon an untrue statement or alleged
untrue statement or omission or alleged omission made in any Preliminary
Prospectus, the Registration Statement or the Prospectus or any such amendment
or supplement in reliance upon and in conformity with written information
furnished to the Company by any Underwriter through you expressly for use
therein or by either Selling Stockholder expressly for use therein; and
provided, further, that the Company shall not be liable to any Underwriter
under the indemnity agreement in this subsection (a) with respect to any
Preliminary Prospectus to the extent that any such loss, claim, damage or
liability of such Underwriter results from the fact that such Underwriter sold
Shares to a person as to whom it shall be established that there was not sent
or given, at or prior to the written confirmation of such sale, a copy of the
Prospectus (excluding documents incorporated by reference) or of the Prospectus
as then amended or supplemented (excluding documents incorporated by reference)
in any case where such delivery is required by the Act if the Company has
previously furnished copies thereof to such Underwriter and the loss, claim,
damage
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or liability of such Underwriter results from an untrue statement or omission
of a material fact contained in the Preliminary Prospectus which was corrected
in the Prospectus (excluding documents incorporated by reference) or in the
Prospectus as then amended or supplemented (excluding documents incorporated by
reference).
(b) Each Selling Stockholder (subject to the limitation on
indemnity set forth in subsection (g)) will indemnify and hold harmless each
Underwriter against any losses, claims, damages or liabilities, joint or
several, to which such Underwriter may become subject, under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions
in respect thereof) arise out of or are based upon an untrue statement or
alleged untrue statement of a material fact contained in any Preliminary
Prospectus, the Registration Statement or the Prospectus, or any amendment or
supplement thereto, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statement therein not misleading, in each case to the
extent, but only to the extent, that such untrue statement or alleged untrue
statement or omission or alleged omission was made in any Preliminary
Prospectus, the Registration Statement or the Prospectus or any such amendment
or supplement in reliance upon and in conformity with written information
furnished by such Selling Stockholder to the Company, or to an Underwriter
through you, expressly for use therein; and will reimburse each Underwriter for
any legal or other expenses reasonably incurred by such Underwriter in
connection with investigating or defending any such action or claim as such
expenses are incurred; provided that such Selling Stockholder shall not be
liable to any Underwriter under the indemnity agreement in this subsection (b)
with respect to any Preliminary Prospectus to the extent that any such loss,
claim, damage or liability of such Underwriter results from the fact that such
Underwriter sold Shares to a person as to whom it shall be established that
there was not sent or given, at or prior to the written confirmation of such
sale, a copy of the Prospectus (excluding documents incorporated by reference)
or of the Prospectus as then amended or supplemented (excluding documents
incorporated by reference) in any case where such delivery is required by the
Act if the Company has previously furnished copies thereof to such Underwriter
and the loss, claim, damage or liability of such Underwriter results from an
untrue statement or omission of a material fact contained in the Preliminary
Prospectus which was corrected in the Prospectus (excluding documents
incorporated by reference) or in the Prospectus as then amended or supplemented
(excluding documents incorporated by reference).
(c) Each Underwriter will indemnify and hold harmless the
Company and each Selling Stockholder against any losses, claims, damages or
liabilities to which the Company or such Selling Stockholder may become
subject, under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon an
untrue statement or alleged untrue statement of a material fact contained in
any Preliminary Prospectus, the Registration Statement or the Prospectus, or
any amendment or supplement thereto, or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, in
each case to the extent, but only to the extent, that such untrue statement or
alleged untrue statement or omission or alleged omission was made in any
Preliminary Prospectus, the Registration Statement or the Prospectus or any
such amendment or supplement in reliance upon and in conformity with written
information furnished to the Company by such Underwriter through you expressly
for use therein; and will reimburse the Company and such Selling Stockholder
for any legal or other expenses reasonably incurred by the Company or such
Selling Stockholder in connection with investigating or defending any such
action or claim as such expenses are incurred.
(d) Promptly after receipt by a party entitled to
indemnification under subsection (a), (b) or (c) above (the "indemnified
party") of notice of the commencement of any action, such indemnified party
shall, if a claim in respect thereof is to be made against a party required to
provide indemnification to such indemnified party under such subsection (the
"indemnifying party"), notify the indemnifying party in writing of the
commencement thereof; but the omission so to notify the indemnifying party
shall not relieve it from any liability which it may have to any indemnified
party otherwise than under such subsection. In case any such action shall be
brought against any indemnified party and it shall notify the indemnifying
party of the commencement thereof, the indemnifying party shall be entitled to
participate therein and, to the extent that it shall wish, jointly with any
other indemnifying party similarly notified, to assume the defense thereof,
with
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counsel satisfactory to such indemnified party (which shall not, except with
the consent of the indemnified party, be counsel to the indemnifying party),
and, after notice from the indemnifying party to such indemnified party of its
election so to assume the defense thereof, the indemnifying party shall not be
liable to such indemnified party under such subsection for any legal expenses
of other counsel or any other expenses, in each case subsequently incurred by
such indemnified party, in connection with the defense thereof other than
reasonable costs of investigation. In no event shall an indemnifying party be
liable for the fees and expenses of more than one counsel (in addition to any
local counsel), apart from counsel to such indemnifying party, for all
indemnified parties in connection with any one action or separate but similar
or related actions arising out of the same general allegations or
circumstances. No indemnifying party shall be liable for any settlement of any
such action effected without its consent, provided that such consent is not
unreasonably withheld or delayed.
(e) If the indemnification provided for in this Section 8 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a), (b) or (c) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities
(or actions in respect thereof) in such proportion as is appropriate to reflect
the relative benefits received by the Company and the Selling Stockholders on
the one hand and the Underwriters on the other from the offering of the Shares.
If, however, the allocation provided by the immediately preceding sentence is
not permitted by applicable law or if the indemnified party failed to give the
notice required under subsection (d) above, then each indemnifying party shall
contribute to such amount paid or payable by such indemnified party in such
proportion as is appropriate to reflect not only such relative benefits but
also the relative fault of the Company and the Selling Stockholders on the one
hand and the Underwriters on the other in connection with the statements or
omissions which resulted in such losses, claims, damages or liabilities (or
actions in respect thereof), as well as any other relevant equitable
considerations. The relative benefits received by the Company and the Selling
Stockholders on the one hand and the Underwriters on the other shall be deemed
to be in the same proportion as the total net proceeds from the offering of the
Shares purchased under this Agreement (before deducting expenses) received by
the Company and the Selling Stockholders on the one hand bear to the total
underwriting discounts and commissions received by the Underwriters on the
other with respect to the Shares purchased under this Agreement, in each case
as set forth in the table on the cover page of the Prospectus. The relative
fault shall be determined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information supplied by
the Company or either Selling Stockholder on the one hand or the Underwriters
on the other and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission. The Company,
the Selling Stockholders and the Underwriters agree that it would not be just
and equitable if contributions pursuant to this subsection (e) were 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 account
of the equitable considerations referred to above in this subsection (e). The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages or liabilities (or actions in respect thereof) referred to
above in this subsection (e) shall be deemed to include 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 subsection (e), (i) no Underwriter shall be required to
contribute any amount in excess of the amount by which the total price at which
the Shares underwritten by it and distributed to the public were offered to the
public exceeds the amount of any damages which such Underwriter has otherwise
been required to pay by reason of such untrue or alleged untrue statement or
omission or alleged omission and (ii) neither Selling Stockholder shall be
required to contribute any amount in excess of the amount by which proceeds
received by such Selling Stockholder from the Shares sold by it pursuant to
this Agreement exceeds that amount of any damages which such Selling
Stockholder has otherwise paid or become liable to pay by reason of any untrue
statement or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The Underwriters' obligations in
this subsection (e) to contribute are several in proportion to their respective
underwriting obligations and not joint.
(f) The obligations of the Company and each Selling
Stockholder under this Section 8 shall be in addition to any liability which
the Company and such Selling Stockholder may otherwise have and shall extend,
upon the same terms and conditions, to each person, if any, who controls any
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Underwriter within the meaning of the Act; and the obligations of the
Underwriters under this Section 8 shall be in addition to any liability which
the respective Underwriters may otherwise have and shall extend, upon the same
terms and conditions, to each officer and director of the Company and to each
partner of each Selling Stockholder and to each person, if any, who controls
the Company and each Selling Stockholder within the meaning of the Act.
(g) Notwithstanding the foregoing, in no event shall either
Selling Stockholder be required to pay an amount in indemnification and
contribution under subsection (b) above in excess of the total proceeds
received by such Selling Stockholder from the Shares sold by it pursuant to
this Agreement.
(h) With respect to rights and obligations of the Company and
the Selling Stockholders vis a vis each other, nothing in this Section 8 shall
be construed to modify or supersede such rights and obligations as set forth in
the Amended and Restated Registration Rights Agreement dated as of September
30, 1987 among the Company, the predecessor to Allied Signal, Inc. and the
Selling Stockholders and the letter dated April 20, 1995 from the Selling
Stockholders to the Company.
9. (a) If any Underwriter shall default in its obligation to
purchase the Shares which it has agreed to purchase hereunder at a Time of
Delivery, you may in your discretion arrange for you or another party or other
parties to purchase such Shares on the terms contained herein. If within
thirty-six hours after such default by any Underwriter you do not arrange for
the purchase of such Shares, then the Selling Stockholders shall be entitled to
a further period of thirty-six hours within which to procure another party or
other parties satisfactory to you to purchase such Shares on such terms. In
the event that, within the respective prescribed periods, you notify the
Selling Stockholders that you have so arranged for the purchase of such Shares,
or the Selling Stockholders notify you that they have so arranged for the
purchase of such Shares, you or the Selling Stockholders shall have the right
to postpone such Time of Delivery for a period of not more than seven days, in
order to effect whatever changes may thereby be made necessary in the
Registration Statement or the Prospectus, or in any other documents or
arrangements, and the Company agrees to file promptly any amendments to the
Registration Statement or the Prospectus which in your opinion and the opinion
of the Company may thereby be made necessary. The term "Underwriter" as used
in this Agreement shall include any person substituted under this Section 9 with
like effect as if such person had originally been a party to this Agreement
with respect to such Shares.
(b) If, after giving effect to any arrangements for the
purchase of the Shares of a defaulting Underwriter or Underwriters by you and
the Selling Stockholders as provided in subsection (a) above, the aggregate
number of such Shares which remains unpurchased does not exceed one-eleventh of
the aggregate number of all the Shares to be purchased at such Time of
Delivery, then the Selling Stockholders shall have the right to require each
non-defaulting Underwriter to purchase the number of Shares which such
Underwriter agreed to purchase hereunder at such Time of Delivery and, in
addition, to require each non-defaulting Underwriter to purchase its pro rata
share (based on the number of Shares which such Underwriter agreed to purchase
hereunder) of the Shares of such defaulting Underwriter or Underwriters for
which such arrangements have not been made; but nothing herein shall relieve a
defaulting Underwriter from liability for its default.
(c) If, after giving effect to any arrangements for the
purchase of the Shares of a defaulting Underwriter or Underwriters by you and
the Selling Stockholders as provided in subsection (a) above, the aggregate
number of such Shares which remains unpurchased exceeds one-eleventh of the
aggregate number of all the Shares to be purchased at such Time of Delivery, or
if the Selling Stockholders shall not exercise the right described in
subsection (b) above to require non-defaulting Underwriters to purchase Shares
of a defaulting Underwriter or Underwriters, then this Agreement (or, with
respect to the Second Time of Delivery, the obligations of the Underwriters to
purchase and of the Selling Stockholders to sell the Optional Shares) shall
thereupon terminate, without liability on the part of any non-defaulting
Underwriter or the Company or the Selling Stockholders, except for the expenses
to be borne by the Company, the Selling Stockholders and the Underwriters as
provided in Section 6 hereof and the
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indemnity and contribution agreements in Section 8 hereof; but nothing herein
shall relieve a defaulting Underwriter from liability for its default.
10. The respective indemnities, agreements, representations,
warranties and other statements of the Company, each Selling Stockholder and
the several Underwriters, as set forth in this Agreement or made by or on
behalf of them, respectively, pursuant to this Agreement, shall remain in full
force and effect, regardless of any investigation (or any statement as to the
results thereof) made by or on behalf of any Underwriter or any controlling
person of any Underwriter, or the Company or the Selling Stockholders, or any
officer or director or controlling person of the Company or the Selling
Stockholders, and shall survive delivery of and payment for the Shares.
11. If this Agreement shall be terminated pursuant to Section
9 hereof, neither the Company nor the Selling Stockholders shall then be under
any liability to any Underwriter except as provided in Section 6 and Section 8
hereof; but, if for any other reason any Shares are not delivered by or on
behalf of either Selling Stockholder as provided herein, the Company will
reimburse the Underwriters through you for all of their out-of-pocket
expenses approved in writing by you, including fees and disbursements of
counsel, reasonably incurred by the Underwriters in making preparations for the
purchase, sale and delivery of the Shares not so delivered, but the Company and
the Selling Stockholders shall then be under no further liability to any
Underwriter in respect of the Shares not so delivered except as provided in
Section 6 and Section 8 hereof.
12. In all dealings hereunder, you shall act on behalf of
each of the Underwriters, and the parties hereto shall be entitled to act and
rely upon any statement, request, notice or agreement on behalf of any
Underwriter made or given by you.
All statements, requests, notices and agreements hereunder
shall be in writing, and if to the Underwriters shall be delivered or sent by
mail, telex or facsimile transmission to you as the representatives at Seven
World Trade Center, New York, N.Y. 10048, Attention: Registration Department;
if to either Selling Stockholder shall be delivered or sent by mail, telex or
facsimile transmission to such Selling Stockholder at _____________, Attention:
______________; and 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
Registration Statement, Attention: Secretary; provided, however, that any
notice to an Underwriter pursuant to Section 8(d) hereof shall be delivered or
sent by mail, telex or facsimile transmission to such Underwriter at its
address set forth in its Underwriters' Questionnaire or telex constituting such
Questionnaire, which address will be supplied to the Company or either Selling
Stockholder by you upon request. Any such statements, requests, notices or
agreements shall take effect upon receipt thereof.
13. This Agreement shall be binding upon, and inure solely to
the benefit of, the Underwriters, the Company and the Selling Stockholders and,
to the extent provided in Sections 8 and 10 hereof, the officers and directors
of the Company and the partners of either Selling Stockholder and each person
who controls the Company, either Selling Stockholder or any Underwriter, and
their respective heirs, executors, administrators, successors and assigns,
and no other person shall acquire or have any right under or by virtue of this
Agreement. No purchaser of any of the Shares from any Underwriter shall be
deemed a successor or assign by reason merely of such purchase.
14. No partner of either Selling Stockholder or any successor
general partner of such Selling Stockholder shall have any personal liability
for the performance of any of such Selling Stockholder's obligations hereunder,
and any liability or obligation of such Selling Stockholder arising hereunder
shall be limited to and satisfied only out of the property of such Selling
Stockholder.
15. Time shall be of the essence of this Agreement. As used
herein, the term "business day" shall mean any day when the Commission's office
in Washington, D.C. is open for business.
16. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
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17. This Agreement may be executed by any one or more of the
parties hereto in any number of counterparts, each of which shall be deemed to
be an original, but all such counterparts shall together constitute one and the
same instrument.
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If the foregoing is in accordance with your understanding,
please sign and return to us nine counterparts hereof, and upon the acceptance
hereof by you, on behalf of each of the Underwriters, this letter and such
acceptance hereof shall constitute a binding agreement among each of the
Underwriters, the Company and the Selling Stockholders.
Very truly yours,
UNION TEXAS PETROLEUM
HOLDINGS, INC.
By:___________________________________________________
___________________________________________________
Name:
Title:
PETROLEUM ASSOCIATES, L.P.
By:___________________________________________________
___________________________________________________
Name:
Title:
KKR PARTNERS II, L.P.
By:___________________________________________________
___________________________________________________
Name:
Title:
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Accepted as of the date hereof
at New York, New York:
SALOMON BROTHERS INC
CS FIRST BOSTON CORPORATION
GOLDMAN, SACHS & CO.
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
By: SALOMON BROTHERS INC
By:_____________________________________
Name:
Title:
For themselves and the other several
Underwriters named in Schedule I to
the foregoing Agreement.
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SCHEDULE I
Number of
Optional Shares
Total Number to be Purchased
of Firm Shares if Maximum
Underwriter to be Purchased Option Exercised
----------- --------------- ----------------
Salomon Brothers Inc . . . . . . . . . . . . . . . .
CS First Boston Corporation . . . . . . . . . . . .
Goldman, Sachs & Co. . . . . . . . . . . . . . . . .
Merrill Lynch, Pierce, Fenner & Smith . . . . . . . .
Incorporated . . . . . . . . . . . . . .
Total . . . . . . . . . . . . . . . . . . 8,000,000 1,200,000
=================================================
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SCHEDULE II
Number of
Optional Shares
Total Number to be Sold
of Firm Shares if Maximum
SELLING STOCKHOLDER to be Sold Option Exercised
- ------------------- -------------- ----------------
Petroleum Associates, L.P. . . . . . . . . . . . . .
KKR Partners II, L.P. . . . . . . . . . . . . . . .
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ANNEX I
Pursuant to Section 7(e) of the Underwriting Agreement, the
accountants shall furnish letters to the Underwriters to the effect that:
(i) They are independent certified public accountants with respect
to the Company and its subsidiaries within the meaning of the Act and the
applicable published rules and regulations thereunder;
(ii) In their opinion, the financial statements and financial
statement schedules provided pursuant to Article 12 of Regulation S-X audited
by them and incorporated by reference in the Registration Statement or the
Prospectus comply as to form in all material respects with the applicable
accounting requirements of the Act or the Exchange Act, as applicable, and the
applicable related published rules and regulations thereunder with respect to
Registration Statements on Form S-3; and they have made a review in accordance
with standards established by the American Institute of Certified Public
Accountants of the consolidated interim financial statements for the periods
specified in such letter, as indicated in their reports thereon, copies of
which have been furnished to the representatives of the Underwriters (the
"Representatives");
(iii) On the basis of limited procedures, not constituting an audit
in accordance with generally accepted auditing standards, consisting of a
reading of the unaudited financial statements referred to below, a reading of
the latest available interim financial data of the Company and its
subsidiaries, a reading of the minute books of the Company and its subsidiaries
since the date of the latest audited financial statements included or
incorporated by reference in the Prospectus, inquiries of officials of the
Company and its subsidiaries responsible for financial and accounting matters
regarding the specified items for which representations are requested below,
nothing came to their attention as a result of the foregoing procedures that
caused them to believe that:
(A) the unaudited condensed consolidated statements of
operations, consolidated balance sheets and consolidated statements of
cash flows included in the Company's Quarterly Reports on Form 10-Q
incorporated by reference in the Prospectus do not comply as to form in
all material respects with the applicable accounting requirements of the
Exchange Act as it applies to Form 10-Q and the related published rules
and regulations thereunder or are not in conformity with generally
accepted accounting principles, when read in conjunction with the audited
financial statements and notes thereto incorporated by reference in the
Registration Statement, applied on a basis substantially consistent with
the basis for the audited consolidated statements of operations,
consolidated balance sheets and consolidated statements of cash flows
included in the Company's Annual Report on Form 10-K for the most recent
fiscal year;
(B) at the date of the latest available interim financial data
and at a specified date not more than five days prior to the date of such
letter, there have been any changes in the consolidated capital stock
(other than issuances of capital stock upon exercise of options and stock
appreciation rights, upon earn-outs of performance shares and upon
conversions of convertible securities, in each case which were
outstanding on the date of the latest balance sheet included or
incorporated by reference in the Prospectus) or any increase in the
consolidated short-term or long-term debt of the Company and its
subsidiaries, or any decreases in consolidated net current assets
(working capital) or stockholders' equity or other items heretofore
determined with the Representatives, or any increases in any items
heretofore determined with the Representatives, in each case as compared
with amounts shown in the latest balance sheet included or incorporated
by reference in the Prospectus, except in each case for changes,
increases or decreases which the Prospectus discloses have occurred or
may occur or which are described in such letter; and
(C) for the period from the date of the latest financial
statements included or incorporated by reference in the Prospectus to the
specified date referred to in Clause (B) there were any decreases in
consolidated net revenues or operating profit or the total or per share
amounts of consolidated net income or other items heretofore determined
with the Representatives, or any increases in any items heretofore
determined with the Representatives, in each case as compared with the
comparable period of the preceding year, except in each case for
increases or decreases which the Prospectus discloses have occurred or
may occur or which are described in such letter; and
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(iv) In addition to the audit referred to in their report(s)
included or incorporated by reference in the Prospectus and the limited
procedures, inspection of minute books, inquiries and other procedures referred
to in paragraphs (ii) and (iii) above, they have carried out certain specified
procedures, not constituting an audit in accordance with generally accepted
auditing standards, with respect to certain amounts, percentages and financial
information specified by the Representatives which are derived from the general
accounting records of the Company and its subsidiaries, which appear in the
Prospectus (excluding documents incorporated by reference) or in Part II of, or
in exhibits and schedules to, the Registration Statement specified by the
Representatives or in documents incorporated by reference in the Prospectus
specified by the Representatives, and have compared certain of such amounts,
percentages and financial information with the accounting records of the
Company and its subsidiaries and have found them to be in agreement.
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ANNEX II
MATERIAL SUBSIDIARIES
Union Texas Petroleum Energy Corporation
Union Texas International Corporation
Union Texas East Kalimantan Limited
Union Texas Pakistan, Inc.
Union Texas Petroleum Limited
Unistar, Inc.
Union Texas Britannia Limited
Union Texas Finance, Inc.