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$100,000,000 PRINCIPAL AMOUNT
SNYDER OIL CORPORATION
____% CONVERTIBLE SUBORDINATED NOTES DUE 2001
UNDERWRITING AGREEMENT
May __, 1994
CS FIRST BOSTON CORPORATION
PAINEWEBBER INCORPORATED
PETRIE PARKMAN & CO., INC.
SMITH BARNEY, SHEARSON INC.
c/o CS First Boston Corporation
Park Avenue Plaza
New York, N.Y. 10055
Dear Sirs:
1. Introductory. Snyder Oil Corporation, a Delaware corporation
("Company"), proposes to issue and sell $100,000,000 aggregate principal amount
of its ___% Convertible Subordinated Notes Due 2001 (the "Firm Securities") to
be issued under an indenture, dated as of April 1, 1994 ("Indenture"), between
the Company and Texas Commerce Bank National Association, as trustee (the
"Trustee"). The Company also proposes to issue and sell not more than
$15,000,000 aggregate principal amount of such securities (the "Optional
Securities"), if and to the extent that the right to purchase such Optional
Securities is exercised as herein described. The Firm Securities and the
Optional Securities are hereinafter collectively referred to as the
"Securities." The Securities are convertible into shares of the Company's
common stock, par value $.01 per share ("Common Stock"), at any time prior to
the maturity of the Securities, unless the Securities have been previously
redeemed or otherwise acquired by the Company, upon the terms and subject to
the conditions set forth in the Indenture. The shares of Common Stock issuable
upon conversion of the Securities are hereinafter
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referred to as the "Shares." The Company hereby agrees with the several
Underwriters named in Schedule A hereto (the "Underwriters") as follows:
2. Representations and Warranties of the Company. The Company
represents and warrants to, and agrees with, the several Underwriters that:
(a) The Company meets the requirements for use of Form S-3
under the Securities Act of 1933, as amended (the "Act"), and a
registration statement (No. 33-52807) on such Form, including a form of
prospectus relating to the Securities and the Shares, has been filed with
the Securities and Exchange Commission ("Commission") and either (i) has
been declared effective under the Act and is not proposed to be amended or
(ii) is proposed to be amended by amendment or post-effective amendment.
If the Company does not propose to amend such registration statement and
if any post-effective amendment to such registration statement has been
filed with the Commission prior to the execution and delivery of this
Agreement, the most recent such amendment has been declared effective by
the Commission. For purposes of this Agreement, "Effective Time" means
(i) if the Company has advised you that it does not propose to amend such
registration statement, the date and time as of which such registration
statement, or the most recent post-effective amendment thereto (if any)
filed prior to the execution and delivery of this Agreement, was declared
effective by the Commission, or (ii) if the Company has advised you that
it proposes to file an amendment or post-effective amendment to such
registration statement, the date and time as of which such registration
statement, as amended by such amendment or post-effective amendment, as
the case may be, is declared effective by the Commission. The term
"Effective Date" means the date of the Effective Time. Such registration
statement, as amended at the Effective Time, including all material
incorporated by reference therein and information (if any) deemed to be a
part of such registration statement as of the Effective Time pursuant to
Rule 430A(b) under the Act, is hereinafter referred to as the
"Registration Statement," and the form of prospectus relating to the
Securities and the Shares, as first filed with the Commission pursuant to
and in accordance with Rule 424(b) ("Rule 424(b)") under the Act or (if no
such filing is required) as included in the Registration Statement,
including all material incorporated by reference in such prospectus, is
hereinafter referred to as the "Prospectus."
(b) If the Effective Time is prior to the execution and
delivery of this Agreement: (i) on the Effective Date, the Registration
Statement conformed in all material respects to the requirements of the
Act, the Trust Indenture Act of 1939, as amended (the "Trust Indenture
Act"), and the rules and regulations of the
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Commission ("Rules and Regulations") and did not include 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, (ii) on the date of this Agreement and at the time of filing
of the Prospectus pursuant to Rule 424(b), the Registration Statement
conforms, and will conform, in all material respects to the requirements
of the Act, the Trust Indenture Act and the Rules and Regulations, and
does not include, and will not include, any untrue statement of a material
fact and does not omit, and will not omit, to state any material fact
required to be stated therein or necessary to make the statements therein
not misleading and (iii) at the time of filing of the Prospectus pursuant
to Rule 424(b), the Prospectus will conform in all material respects to
the requirements of the Act and the Rules and Regulations and will not
include any untrue statement of a material fact or omit 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. If the
Effective Time is subsequent to the execution and delivery of this
Agreement: on the Effective Date, the Registration Statement and the
Prospectus will conform in all material respects to the requirements of
the Act, the Trust Indenture Act and the Rules and Regulations, the
Registration Statement will not include 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, and the
Prospectus will not include any untrue statement of a material fact or
omit 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. The two preceding sentences do not apply to statements in or
omissions from the Registration Statement or Prospectus based upon written
information furnished to the Company by any Underwriter through you
specifically for use therein or contained in the Statement of Eligibility
and Qualification on Form T-1 furnished by the Trustee and filed as an
exhibit to the Registration Statement.
(c) The documents which are incorporated by reference in the
Registration Statement and the Prospectus, and any amendments or
supplements thereto, when they were filed with the Commission or were or
hereafter are last amended, complied in all material respects with the
requirements of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), and the Rules and Regulations promulgated under the
Exchange Act, and when read together with the information in the
Prospectus, no such document, when it was filed with the Commission or was
or hereafter is last amended, 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.
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(d) All the outstanding shares of Common Stock of the
Company have been duly authorized and validly issued, are fully paid and
nonassessable and are free of any preemptive or similar rights. The
Shares have been duly authorized and reserved for issuance upon the
conversion of the Securities and, if and when issued upon such conversion
in accordance with the provisions of the Indenture, will be validly
issued, fully paid, nonassessable and free of any preemptive or other
similar rights. The capital stock of the Company conforms to the
description thereof contained in the Registration Statement and the
Prospectus in all material respects. There are no outstanding options,
warrants or other rights to acquire from the Company any capital stock
except pursuant to the stock option plans and agreements referred to and
otherwise described in the Registration Statement or the Prospectus.
(e) The Company is a corporation duly organized and
validly existing in good standing under the laws of the State of Delaware,
and is duly registered and qualified to conduct its business and is in
good standing in each jurisdiction or place where the nature of its
properties or the conduct of its business requires such registration or
qualification, except where the failure so to register or qualify will not
have a material adverse effect on the condition (financial or other),
business, properties, net worth or results of operations of the Company
and the Subsidiaries (as hereinafter defined) taken as a whole.
(f) All the Company's subsidiaries that are required to be
listed in an exhibit to the Registration Statement or to any document
incorporated by reference therein are so listed (collectively, the
"Subsidiaries"). Each Subsidiary is a corporation or limited partnership
duly organized, validly existing and in good standing in the jurisdiction
of its organization, and is duly registered and qualified to conduct its
business and is in good standing in each jurisdiction or place where the
nature of its properties or the conduct of its business requires such
registration or qualification, except where the failure to so register or
qualify will not have a material adverse effect on the condition
(financial or other), business, properties, net worth or results of
operations of the Company and the Subsidiaries taken as a whole. All the
outstanding shares of capital stock of, or other equity interests in, each
of the Subsidiaries have been duly authorized and validly issued, are
fully paid and nonassessable and are owned by the Company directly, or
indirectly through one of the other Subsidiaries, free and clear of any
lien, adverse claim, security interest, equity or other encumbrance,
except for the lien granted pursuant to the bank credit facility
referenced in the Registration Statement.
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(g) The Company and the Subsidiaries have all requisite
corporate power and authority, and have obtained all necessary
authorizations, approvals, orders, licenses, franchises, certificates and
permits of and from all governmental regulatory officials and bodies
("Permits"), to own, lease and operate their respective properties and
conduct their respective businesses as described in the Registration
Statement and the Prospectus, except where the failure to obtain such
Permits will not have a material adverse effect on the condition
(financial or other), business, properties, net worth or results of
operations of the Company and the Subsidiaries taken as a whole. Each of
the Company and the Subsidiaries has fulfilled and performed all its
current material obligations with respect to such Permits and no event has
occurred which allows, or after notice or lapse of time, or both, would
allow, revocation or termination thereof or result in any other material
impairment of the rights of the holder of any such Permit, subject in each
case to such qualification as may be set forth in the Registration
Statement and the Prospectus and except where the failure to do so will
not have a material adverse effect on the condition (financial or other),
business, properties, net worth or results of operations of the Company
and the Subsidiaries taken as a whole. Except as described in the
Registration Statement and the Prospectus and as is customary in the oil
and gas industry or in the areas where the properties of the Company or
the Subsidiaries are located, such Permits contain no restrictions that
are materially burdensome to the Company and the Subsidiaries taken as a
whole. The Company and the Subsidiaries own, or possess adequate rights
to use, all trademarks, service marks and other rights necessary for the
conduct of their business as presently conducted and described in the
Registration Statement and the Prospectus, and neither the Company nor any
of the Subsidiaries has received any notice of conflict with the asserted
rights of others in any such respect that would materially adversely
affect their business and neither the Company nor any Subsidiary knows of
any basis therefor. The property and business of the Company and the
Subsidiaries taken as a whole conform in all material respects to the
descriptions thereof contained in the Registration Statement and the
Prospectus.
(h) There are no legal or governmental proceedings pending
or, to the knowledge of the Company, threatened, against the Company or
any of the Subsidiaries, or to which the Company or any of the
Subsidiaries, or to which any of their respective properties, is subject
that are required to be described in the Registration Statement or the
Prospectus but are not described as required, and there are no agreements,
contracts, indentures, leases or other instruments that are required to be
described in the Registration Statement or the Prospectus or to be filed
as an exhibit to the Registration Statement that are not described or
filed as required by the Act.
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(i) Neither the Company nor any of the Subsidiaries is (i)
in violation of any term or provision of its certificate or articles of
incorporation or bylaws, or other organizational documents, or of any law,
ordinance, administrative or governmental rule or regulation applicable to
the Company or any of the Subsidiaries or of any franchise, license,
permit, judgment or any decree of any court or governmental agency or body
having jurisdiction over the Company or any of the Subsidiaries or (ii) in
default (and no event has occurred that with notice or lapse of time, or
both, would constitute a default) in any respect in the due performance of
any obligation, agreement or condition contained in any bond, debenture,
note or any other evidence of indebtedness or in any agreement, indenture,
lease or other instrument to which the Company or any of the Subsidiaries
is a party or by which any of them or any of their respective properties
may be bound, which default would have a material adverse effect on the
condition (financial or other) business, properties, net worth or results
of operations of the Company and the Subsidiaries taken as a whole.
(j) Neither the execution, delivery or performance of this
Agreement or the Indenture by the Company, the issuance, offer, sale or
delivery of the Securities, or the issuance of the Shares, nor the
consummation by the Company of the transactions contemplated by this
Agreement or the Indenture (i) requires any consent, approval,
authorization or other order of, or registration or filing with, any
court, regulatory body, administrative agency or other governmental body,
agency or official (other than (A) the registration of the Securities and
the Shares under the Act, (B) qualification of the Indenture under the
Trust Indenture Act and (C) compliance with the securities or Blue Sky
laws of various jurisdictions, all of which will be, or have been,
effected in accordance with this Agreement) or conflicts or will conflict
with or constitutes or will constitute a breach of, or a default under,
the certificate or articles of incorporation or bylaws, or other
organizational documents, of the Company or any of the Subsidiaries or
(ii) conflicts or will conflict with or constitutes or will constitute a
breach of, or a default under, any agreement, indenture, lease or other
instrument to which the Company or any of the Subsidiaries is a party or
by which any of them or any of their respective properties may be bound,
or violates or will violate any statute, law, regulation or filing or
judgment, injunction, order or decree applicable to the Company or any of
the Subsidiaries or any of their respective properties or (iii) results or
will result in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of the Company or any of the
Subsidiaries pursuant to the terms of any agreement or instrument to which
any of them is a party or by which any of them may be bound or to which
any of the property or assets of any of them is subject.
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(k) Arthur Andersen & Co., the accountants for the Company
who have certified the financial statements and the related financial
statement schedules included in the Company's most recent Annual Report on
Form 10-K, which is incorporated by reference in the Prospectus, are
independent public accountants with respect to the Company and the
Subsidiaries as required by the Act.
(l) Netherland, Sewell & Associates, Inc. ("Netherland
Sewell"), whose reserve reports and audits are filed as exhibits to the
Company's most recent Annual Report on Form 10-K, are independent
petroleum engineers with respect to the Company and the Subsidiaries.
(m) The consolidated financial statements, together with
related schedules and notes, included in or incorporated by reference in
the Registration Statement and the Prospectus present fairly the
consolidated financial position, results of operations and cash flows of
the Company and the Subsidiaries on the basis stated in the Company's most
recent Annual Report on Form 10-K at the respective dates or for the
respective periods to which they apply. Such statements and related
schedules and notes have been prepared in accordance with generally
accepted accounting principles consistently applied throughout the periods
involved, except as disclosed therein. The reserve reports and audits of
Netherland Sewell present the proved reserves, future net revenues
therefrom and discounted present value thereof in compliance with the
applicable Rules and Regulations, and all of the information furnished by
the Company to Netherland Sewell and used in connection with the
preparation of such reports and audits (including, but not limited to,
information regarding working interests, net revenue interests and
pricing) was true and correct in all material respects as of the
applicable effective date of such reports and audits and conformed with
the applicable Rules and Regulations. The other financial and statistical
information and data set forth in the Registration Statement and the
Prospectus are accurately presented and prepared on a basis consistent
with such financial statements or reserve reports or audits and the books
and records of the Company.
(n) The Company has all corporate power and authority
necessary to execute and deliver this Agreement and the Indenture to
perform its obligations under this Agreement and the Indenture. The
execution and delivery of, and the performance by the Company of its
obligations under, this Agreement has been duly and validly authorized by
the Company, and this Agreement has been duly executed and delivered by
the Company and constitutes a valid and legally binding agreement of the
Company, enforceable against the Company in accordance with its terms,
except as rights to indemnity and contribution hereunder may be limited
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by federal or state securities laws and except as such enforceability may
be limited by bankruptcy, insolvency, reorganization, moratorium, or other
laws relating to or affecting creditors' rights generally and by general
equitable principles. The Indenture and the Securities, the execution and
delivery by the Company of the Indenture and the Securities and the
consummation of the transactions contemplated by the Indenture and the
Securities have been duly authorized by the Company. If the Securities
are issued in accordance with the provisions of the Indenture (when the
Indenture has been executed and delivered by the Company and assuming due
authorization, execution and delivery by the Trustee), the Securities and
the Indenture will be valid and legally binding obligations of the Company
enforceable in accordance with their respective terms, except as such
enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium and other laws relating to or affecting creditors' rights
generally and by general equitable principles.
(o) The respective forms of the Indenture and the
Securities filed as exhibits to the Registration Statement conform, and,
if and when executed by the Company, the Indenture and the Securities so
executed will conform, to the respective descriptions thereof contained in
the Prospectus in all material respects.
(p) Except as disclosed in the Registration Statement and
the Prospectus, subsequent to the respective dates as of which such
information is given in the Registration Statement and the Prospectus,
neither the Company nor any of the Subsidiaries has incurred any liability
or obligation, direct or contingent, or entered into any transaction, not
in the ordinary course of business, that is material to the Company and
the Subsidiaries taken as a whole, and there has not been any material
change in the capital stock, or material increase in the short-term debt
or long-term debt, of the Company or any of the Subsidiaries, or any
material adverse change, or any development involving or which may
reasonably be expected to involve a prospective material adverse change,
in the condition (financial or other), business, net worth or results of
operations of the Company and the Subsidiaries taken as a whole.
(q) Each of the Company and the Subsidiaries, except with
respect to its respective interests in oil and gas leases, has good and
marketable title in fee simple to all material real property owned by it,
valid and defensible title to all material personal property owned by it
and valid and enforceable interests in leases of all material real and
personal property leased by it, in each case free and clear of all
security interests, mortgages, pledges, liens, encumbrances, charges and
defects (collectively, "encumbrances"), except for those encumbrances
granted to
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secure indebtedness specified in the Registration Statement and those that
do not materially and adversely affect the value of such property or
materially interfere with the intended use of such property by it. Each
of the Company and the Subsidiaries has good and defensible title to all
of its respective interests in oil and gas leases, free and clear of any
encumbrances, except encumbrances granted to secure the indebtedness
specified in the Registration Statement, subject only to liens for taxes
or charges of mechanics or materialmen not yet due and to encumbrances
under gas sales contracts, operating agreements, unitization and pooling
agreements and other similar agreements customarily found in connection
with comparable drilling and producing operations and to title defects
that are, singly and in the aggregate, not material in amount and do not
interfere with its use or enjoyment of its oil and gas properties. Each
of the Company and the Subsidiaries has conducted such title
investigations and has acquired its respective interests in oil and gas
leases in such manner as is customary in the oil and gas industry. Each
of the Company and the Subsidiaries has complied in all material respects
with the terms of the oil and gas leases in which it purports to own an
interest, and all of such leases are in full force and effect (except
where the failure so to comply or to be in full force and effect would not
have a material adverse effect on the condition (financial or other),
business, properties, net worth or results of operations of the Company
and its Subsidiaries taken as a whole).
(r) The Company has not distributed and, prior to the
latest to occur of (i) the First Closing Date (as defined below), (ii) the
Second Closing Date (as defined below) and (iii) the completion of the
Company's distribution of the Securities, will not distribute any offering
material in connection with the offering and sale of the Securities other
than the Registration Statement, the Prospectus or other materials
permitted by the Act.
(s) The Company is not an "investment company" within the
meaning of the Investment Company Act of 1940, as amended.
(t) To the Company's knowledge, neither the Company nor
any of the Subsidiaries nor any employee or agent of the Company or any
Subsidiary has made any payment of funds of the Company or any Subsidiary
or received or retained any funds in violation of any law, rule or
regulation, which payment, receipt or retention of funds is of a character
required to be disclosed in the Prospectus.
(u) There are no contracts, agreements or understandings
between the Company and any person granting such person the right to
require the Company
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to file a registration statement under the 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 Statement or in any securities
being registered pursuant to any other registration statement filed by the
Company under the Act.
(v) Neither the Company nor any of the Subsidiaries is
involved in any labor dispute nor, to the knowledge of the Company, is any
such dispute threatened.
(w) Each of the Company and the Subsidiaries has filed all
federal, state and local tax returns that are required to be filed or has
obtained extensions thereof, and has paid all taxes shown on such returns
and all assessments received by it to the extent that the same have become
due or is contesting such taxes in good faith by appropriate proceedings.
(x) Except for the shares of capital stock of each of the
Subsidiaries, neither the Company nor any of the Subsidiaries owns any
share of stock or any other securities of any corporation or has any
equity interest in any firm, partnership, association or other entity
material in amount in relation to the net assets of the Company and the
Subsidiaries taken as a whole, other than as disclosed in the Prospectus
or as reflected in the consolidated financial statements included or
incorporated by reference in the Registration Statement and the
Prospectus.
(y) The Company has complied with all of the provisions of
Florida H.B. 1771, codified as Section 517.075 of the Florida statutes,
and all regulations promulgated thereunder relating to issuers doing
business with the Government of Cuba or with any person or any affiliate
located in Cuba.
(z) The Company has caused each of John C. Snyder, Thomas
J. Edelman and John A. Fanning to enter into an agreement with the
Underwriters providing that for a period of 90 days after the effective
date of the Registration Statement they will not without the prior written
consent of CS First Boston Corporation sell, contract to sell, cause or in
any way permit to be sold, or otherwise dispose of any shares of Common
Stock or any shares of preferred stock, par value $.01 per share
("Preferred Stock"), of the Company or any depositary shares representing
an interest in Preferred Stock (or any securities convertible into or
exercisable for any such shares of Common Stock or Preferred Stock or
depositary shares), except that each such person may dispose of Common
Stock
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with a value not to exceed in the aggregate $100,000 owned by such person
on the date hereof as a gift.
3. Purchase, Sale and Delivery of Securities. On the basis of the
representations, warranties and agreements contained herein, but subject to the
terms and conditions set forth herein, the Company agrees to sell to each
Underwriter, and each Underwriter agrees, severally and not jointly, to
purchase from the Company, at a purchase price of 100% of the principal amount
thereof, plus accrued interest, if any, from May ___, 1994 to the First Closing
Date (as defined below), the respective principal amounts of Firm Securities
set forth opposite the name of such Underwriter in Schedule A hereto.
The Company will deliver the Firm Securities to you at the office of
CS First Boston Corporation, Park Avenue Plaza, 55 East 52nd Street, New York,
New York, 10055 or such other place as you and the Company determine, against
payment of the purchase price, by certified or official bank check or checks
payable in New York Clearing House (next day) funds drawn to the order of the
Company, at the above office of CS First Boston Corporation, at 10:00 A.M., New
York time, on May ___, 1994, or at such other place and at such other time not
later than seven full business days thereafter as you and the Company
determine, such time being hereinafter referred to as the "First Closing Date."
The certificates evidencing the Firm Securities to be so delivered will be in
definitive form, in such denominations and registered in such names as you
request, and will be made available for checking and packaging at the above
office of CS First Boston Corporation at least 24 hours prior to the First
Closing Date.
In addition, upon written notice from you given to the Company not
more than 30 days subsequent to the date of the initial public offering of the
Firm Securities, the Underwriters may purchase all or less than all of the
Optional Securities at a purchase price of 100% of the principal amount
thereof, plus accrued interest, if any, from May __, 1994 to the Second Closing
Date (as defined below). The Company agrees to sell to the Underwriters the
principal amount of Optional Securities specified in such notice and the
Underwriters agree, severally and not jointly, to purchase such Optional
Securities. Such Optional Securities shall be purchased from the Company for
the account of each Underwriter in the same proportion as the principal amount
of Firm Securities set forth opposite such Underwriter's name in Schedule A
hereto bears to the total principal amount of Firm Securities (subject to
adjustment by you to round purchases to the nearest $1,000 principal amount)
and may be purchased by the Underwriters only for the purpose of covering
over-allotments made in connection with the sale of the Firm Securities. No
Optional Securities shall be sold or delivered unless
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the Firm Securities previously have been, or simultaneously are, sold and
delivered. The right to purchase the Optional Securities, or any portion
thereof, may be surrendered and terminated at any time upon notice by you to
the Company.
The time for the delivery of and payment for the Optional Securities,
being hereinafter referred to as the "Second Closing Date" (which may be the
First Closing Date), shall be determined by you but shall not be later than 10
days after written notice of election to purchase the Optional Securities is
given. The Company will deliver the Optional Securities to you at the above
office of CS First Boston Corporation or such other place as you and the
Company determine, against payment of the purchase price therefor by certified
or official bank check or checks in New York Clearing House (next day) funds
drawn to the order of the Company at the above office of CS First Boston
Corporation or such other place you and the Company determine. The
certificates evidencing the Optional Securities will be in definitive form, in
such denominations and registered in such names as you request, and will be
made available for checking and packaging at the above office of CS First
Boston Corporation at least 24 hours prior to the Second Closing Date.
4. Offering by Underwriters. It is understood that the several
Underwriters propose to offer the Securities for sale to the public as set
forth in the Prospectus.
5. Certain Agreements of the Company. The Company agrees with the
several Underwriters that:
(a) If the Effective Time is prior to the execution and
delivery of this Agreement, the Company will file the Prospectus with the
Commission pursuant to and in accordance with subparagraph (1) (or, if
applicable and if consented to by you, subparagraph (3) or (4)) of Rule
424(b) not later than the earlier of (i) the second business day following
the execution and delivery of this Agreement or (ii) the fifth business
day after the Effective Date. The Company will advise you promptly of any
such filing pursuant to Rule 424(b).
(b) The Company will advise you promptly of any proposal
to amend or supplement the registration statement as filed or the related
prospectus or the Registration Statement or the Prospectus and will not
effect any such amendment or supplementation to which you shall reasonably
object after being so advised or which is not in compliance with the Rules
and Regulations. So long as a prospectus relating to the Securities is
required to be delivered under the Act, the Company will not file any
information, documents or reports pursuant to the Exchange Act without
delivering a copy of such information, documents or reports
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to you prior to or concurrently with such filings. The Company will also
advise you promptly of the effectiveness of the Registration Statement (if
the Effective Time is subsequent to the execution and delivery of this
Agreement) and of any amendment or supplementation of the Registration
Statement or the Prospectus and of the institution by the Commission of
any stop order proceedings in respect of the Registration Statement and
will make every reasonable effort to prevent the issuance of any such stop
order and to obtain as soon as possible its lifting, if issued.
(c) If, at any time when a prospectus relating to the
Securities is required to be delivered under the Act, any event occurs 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 to make the statements therein, in the light of
the circumstances under which they were made, not misleading, or if it is
necessary at any time to amend the Prospectus to comply with the Act, the
Company will promptly prepare and file with the Commission an amendment or
supplement which will correct such statement or omission or an amendment
which will effect such compliance. Neither your consent to, nor the
Underwriters' delivery of, any such amendment or supplement shall
constitute a waiver of any of the conditions set forth in Section 6.
(d) As soon as practicable, but not later than the
Availability Date (as defined below), the Company will make generally
available to its security holders an earnings statement covering a period
of at least 12 months beginning after the Effective Date which will
satisfy the provisions of Section 11(a) of the Act and Rule 158 under the
Act. For the purpose of the preceding sentence, "Availability Date" means
the 45th day after the end of the fourth fiscal quarter following the
fiscal quarter that includes the Effective Date, except that, if such
fourth fiscal quarter is the last quarter of the Company's fiscal year,
"Availability Date" means the 90th day after the end of such fourth fiscal
quarter.
(e) The Company will furnish to you copies of the
Registration Statement (five of which will be signed and will include all
exhibits), each related preliminary prospectus, the Prospectus and all
amendments and supplements to such documents (including any document filed
under the Exchange Act and deemed to be incorporated by reference
therein), in each case as soon as available and in such quantities as you
reasonably request.
(f) The Company will arrange for the registration and
qualification of the Securities for sale and the determination of their
eligibility for investment
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under the laws of such jurisdictions as you may reasonably designate and
will continue such qualifications in effect so long as required for the
distribution.
(g) During the period of three years hereafter, the
Company will furnish to you, as soon as practicable after the end of each
fiscal year, a copy of its annual report to stockholders for such year;
and the Company will furnish to you (i) as soon as available, a copy of
each report or definitive proxy statement of the Company filed with the
Commission under the Exchange Act or mailed to stockholders, and (ii) from
time to time, such other information concerning the Company as you may
reasonably request.
(h) The Company agrees to pay the following costs and
expenses and all other costs and expenses incident to the performance by
it of its obligations hereunder: (i) the preparation, printing and filing
with the Commission of the Registration Statement (including financial
statements and schedules and exhibits thereto) and the Prospectus, and
each amendment or supplement to either of them, (ii) the printing and
delivery (including postage, air freight charges and charges for counting
and packaging) of such copies of the Registration Statement, the
Prospectus, and all amendments or supplements to either of them as may be
reasonably requested for use in connection with the offering and sale of
the Securities, (iii) the preparation, printing, authentication, issuance
and delivery of certificates for the Securities, and, if and when issued,
the Shares, including any stamp taxes and any transfer agent's, trustee's
or registrar's fees and expenses payable in connection with the original
issuance of any of the foregoing, (iv) the printing and delivery of the
Indenture, the preliminary and supplemental Blue Sky Memoranda and all
other agreements, memoranda, correspondence and other documents printed
and delivered in connection with the offering of the Securities, (v) the
registration or qualification of the Securities for offer and sale under
the securities or Blue Sky laws of the several states as provided in
Section 5(f) (including the reasonable fees, expenses and disbursements of
Baker & Botts, L.L.P. relating to the preparation, printing or
reproduction, and delivery of the preliminary and supplemental Blue Sky
Memoranda and such registration and qualification), (vi) the filing fees
and the fees and expenses of Baker & Botts, L.L.P. in connection with any
filings required to be made with the National Association of Securities
Dealers, Inc. in connection with the offering, (vii) the fees and expenses
of the Company's accountants and petroleum engineers and the fees and
expenses of counsel (including local and special counsel) for the Company,
(viii) any fees charged by any rating agency in connection with a rating
of the Securities, (ix) the registration of the Securities under the
Exchange Act, (x)
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the fees and expenses of listing the Securities and the Shares on the New
York Stock Exchange and (xi) the performance by the Company of its other
obligations under this Agreement, including the fees of the Trustee.
(i) The Company has not taken, nor will it take, directly
or indirectly, any action designed to or that might reasonably be expected
to cause or result in stabilization or manipulation of the price of its
capital stock or debt securities to facilitate the sale or resale of the
Securities.
(j) The Company will reserve and keep available at all
times, free of any preemptive or other similar rights, a sufficient number
of shares of Common Stock to provide for the issuance of such shares upon
conversion of the Securities.
(k) The Company will use its best efforts to effect and
maintain the listing of the Securities and the Shares on the New York
Stock Exchange as promptly as possible and to cause the Securities to be
registered under the Exchange Act at the Effective Time.
(l) For a period of 90 days after the date of the
commencement of the public offering of the Securities by you, the Company
will not issue, sell, contract to sell, grant any option for the sale of
or otherwise dispose of, directly or indirectly, any capital stock,
including, but not limited to, any Common Stock or Preferred Stock or any
depositary shares representing an interest in Preferred Stock (or any
securities convertible into or exercisable for any such shares of Common
Stock or Preferred Stock or depositary shares), other than the Securities
or the Shares (if any are issued upon conversion of the Securities),
without the prior written consent of CS First Boston Corporation, except
that the Company may sell or issue, or grant options with respect to,
shares of the Common Stock in connection with the Company's stock option
plans or other outstanding options or with the conversion of its
outstanding convertible instruments.
6. Conditions of the Obligations of the Underwriters. The
obligations of the several Underwriters to purchase and pay for the Firm
Securities on the First Closing Date and the Optional Securities on the Second
Closing Date will be subject to the accuracy of the representations and
warranties on the part of the Company herein, to the accuracy of the statements
of the Company's officers made pursuant to the provisions hereof, to the
performance by the Company of its obligations hereunder and to the following
additional conditions precedent:
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(a) You shall have received a letter, dated the date of
delivery thereof (which, if the Effective Time is prior to the execution
and delivery of this Agreement, shall be on or prior to the date of this
Agreement or, if the Effective Time is subsequent to the execution and
delivery of this Agreement, shall be prior to the filing of the amendment
or post-effective amendment to the registration statement to be filed
shortly prior to the Effective Time), of Arthur Andersen & Co. confirming
that they are independent public accountants with respect to the Company
within the meaning of the Act and the applicable published Rules and
Regulations thereunder and stating in effect that:
(i) in their opinion the financial statements
and schedules examined by them and incorporated by reference in the
Registration Statement comply in form in all material respects with
the applicable accounting requirements of the Act and the related
published Rules and Regulations;
(ii) on the basis of a reading of the latest
available interim financial statements of the Company, inquiries of
officials of the Company who have responsibility for financial and
accounting matters and other specified procedures, nothing came to
their attention that caused them to believe that:
(A) at the date of the latest available balance
sheet read by such accountants, or at a subsequent specified
date not more than five days prior to the date of this
Agreement, there was any change greater than five percent in
the consolidated capital stock or the consolidated long-term
debt of the Company or any decrease greater than five percent
in consolidated working capital or net long-term assets, as
compared with amounts shown on the latest balance sheet
included in the Prospectus; or
(B) for the period from the closing date of the
latest income statement included in the Prospectus to the
closing date of the latest available income statement read by
such accountants, or to the subsequent specified date referred
to in clause (A), there were any decreases greater than five
percent, as compared with the period of corresponding length
ended the date of the latest income statement included in the
Prospectus, in consolidated oil and gas sales revenues or
increases greater than five percent in consolidated direct
operating expenses;
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except in all cases set forth in clauses (A) and (B) above for
changes, increases or decreases which the Prospectus discloses have
occurred or may occur or which are described in such letter; and
(iii) they have compared specified dollar amounts
(or percentages derived from such dollar amounts) and other financial
information contained in the Registration Statement (in each case to
the extent that such dollar amounts, percentages and other financial
information are derived from the general accounting records of the
Company and its subsidiaries subject to the internal controls of the
Company's accounting system or are derived directly from such records
by analysis or computation) with the results obtained from inquiries,
a reading of such general accounting records and other procedures
specified in such letter and have found such dollar amounts,
percentages and other financial information to be in agreement with
such results, except as otherwise specified in such letter.
For purposes of this subsection, if the Effective Time is subsequent to
the execution and delivery of this Agreement, "Registration Statement"
shall mean the registration statement as proposed to be amended by the
amendment or post-effective amendment to be filed shortly prior to the
Effective Time, and "Prospectus" shall mean the prospectus included in the
Registration Statement. All financial statements and schedules included
in material incorporated by reference into the Prospectus shall be deemed
included in the Registration Statement for purposes of this subsection.
(b) If the Effective Time is not prior to the execution
and delivery of this Agreement, the Effective Time shall have occurred not
later than 10:00 P.M., New York time, on the date of this Agreement or
such later date as shall have been consented to by you. If the Effective
Time is prior to the execution and delivery of this Agreement, the
Prospectus shall have been filed with the Commission in accordance with
the Rules and Regulations and Section 5(a) of this Agreement. Prior to
such Closing Date, no stop order suspending the effectiveness of the
Registration Statement shall have been issued and no proceedings for that
purpose shall have been instituted or, to the knowledge of the Company or
you, shall be contemplated by the Commission.
(c) Subsequent to the execution and delivery of this
Agreement, there shall not have occurred (i) any change, or any
development involving a prospective change, in or affecting particularly
the business or properties of the Company or its subsidiaries which, in
the judgment of a majority in interest of the
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Underwriters, materially impairs the investment quality of the Securities;
(ii) any downgrading in the rating of any debt securities or Preferred
Stock of the Company by any "nationally recognized statistical rating
organization" (as defined for purposes of Rule 436(g) under the Act), or
any public announcement that any such organization has under surveillance
or review its rating of any debt securities or Preferred Stock of the
Company (other than an announcement with positive implications of a
possible upgrading, and no implication of a possible downgrading, of such
rating); (iii) any suspension or limitation of trading in securities
generally on the New York Stock Exchange, or any setting of minimum prices
for trading on such exchange, or any suspension of trading of any
securities of the Company on any exchange or in the over-the-counter
market; (iv) any banking moratorium declared by Federal or New York
authorities; or (v) any outbreak or escalation of major hostilities in
which the United States is involved, any declaration of war by Congress or
any other substantial national or international calamity or emergency if,
in the judgment of a majority in interest of the Underwriters, the effect
of any such outbreak, escalation, declaration, calamity or emergency makes
it impractical or inadvisable to proceed with completion of the sale of
and payment for the Securities.
(d) You shall have received an opinion, dated such Closing
Date, of Peter E. Lorenzen, General Counsel for the Company, to the effect
that:
(i) The Company is a corporation duly
incorporated and validly existing in good standing under the laws of
the State of Delaware, with full corporate power and authority to
own, lease and operate its properties and to conduct its business as
described in the Registration Statement and the Prospectus, and is
duly registered and qualified to conduct its business and is in good
standing in each jurisdiction or place where the nature of its
properties or the conduct of its business requires such registration
or qualification, except where the failure so to register or qualify
will not have a material adverse effect on the condition (financial
or other), business, properties, net worth or results of operations
of the Company and the Subsidiaries taken as whole;
(ii) Each of the Subsidiaries is a corporation
or limited partnership duly organized and validly existing in good
standing under the laws of the jurisdiction of its organization, with
full corporate or partnership power and authority to own, lease and
operate its properties and to conduct its business as described in
the Registration Statement and the Prospectus, and is duly registered
and qualified to conduct its business and is in good standing in each
jurisdiction or place where the nature of its properties or the
conduct of
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its business requires such registration or qualification, except
where the failure so to register or qualify will not have a material
adverse effect upon the Company and the Subsidiaries taken as a
whole; and all of the outstanding shares of capital stock of, or
other equity securities in, each of the Subsidiaries have been duly
authorized and validly issued, are fully paid and nonassessable, and
are owned by the Company directly, or indirectly through one of the
other Subsidiaries, free and clear of any perfected security
interest, or, to the best knowledge of such counsel, any other
security interest, lien, adverse claim, equity or other encumbrance
except for the lien granted pursuant to the bank credit facility
referenced in the Registration Statement;
(iii) The authorized and outstanding capital
stock of the Company is as set forth under the caption
"Capitalization" in the Prospectus; the authorized capital stock of
the Company conforms in all material respects as to legal matters to
the description thereof contained in the Prospectus under the caption
"Description of Capital Stock;" and the Securities, the Shares and
the Indenture conform in all material respects to the respective
descriptions thereof contained in the Prospectus under the captions
"Description of Notes" and "Description of Capital Stock;"
(iv) All the outstanding shares of capital stock
of the Company have been duly authorized and validly issued and are
fully paid and nonassessable;
(v) The Securities have been duly authorized
and executed by the Company and, when certificates for the Securities
are issued and delivered to you against payment therefor in
accordance with the terms hereof, will be valid and legally binding
obligations of the Company, enforceable in accordance with the
provisions thereof (except as such enforceability may be limited by
bankruptcy, insolvency, reorganization, moratorium and other laws
relating to or affecting creditors' rights generally and by general
equitable principles), and will entitle the holders thereof to the
rights specified therein and in the Indenture; and, to the best
knowledge of such counsel, there are no preemptive or similar rights
that entitle any person to acquire any Securities upon the issuance
thereof by the Company;
(vi) The Indenture has been duly authorized,
executed and delivered by the Company and is a valid and legally
binding obligation of the Company, enforceable in accordance with the
provisions thereof (except as such enforceability may be limited by
bankruptcy, insolvency, reorganization,
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moratorium and other laws relating to or affecting creditors' rights
generally and by general equitable principles);
(vii) The Shares have been duly authorized by the
Company and reserved for issuance upon conversion of the Securities
and, if and when issued upon such conversion, will be validly issued,
fully paid and nonassessable; and, to the best knowledge of such
counsel, there are no preemptive or similar rights that will entitle
any person to acquire any Shares upon the issuance thereof by the
Company.
(viii) The form of certificate for the Securities
contemplated by the Indenture conforms to the requirements of New
York law; and the form of certificate for the Shares conforms to the
requirements of the Delaware General Corporation Law;
(ix) The Registration Statement and all
post-effective amendments, if any, have become effective under the
Act and, to the best knowledge of such counsel, no stop order
suspending the effectiveness of the Registration Statement has been
issued and no proceedings for that purpose are pending before or
contemplated by the Commission;
(x) The Indenture (A) conforms in all material
respects to the applicable requirements of the Trust Indenture Act
and (B) has been duly qualified under the Trust Indenture Act;
(xi) The Company has full corporate power and
authority to enter into this Agreement and to perform its obligations
(including the sale and delivery of the Securities) hereunder, and
this Agreement has been duly authorized, executed and delivered by
the Company and is a valid, legal and binding agreement of the
Company, enforceable in accordance with its terms, except as rights
to indemnification and contribution hereunder may be limited by
applicable securities laws and except as the enforceability of the
Company's obligations hereunder may be limited by bankruptcy,
insolvency, reorganization, moratorium and other laws relating to or
affecting creditors' rights generally and by general equitable
principles;
(xii) To the best knowledge of such counsel,
neither the Company nor any of the Subsidiaries (A) is in violation
of its certificate or articles of incorporation or bylaws, or other
organizational documents, (B) is in breach of, or in default (nor has
an event occurred that with notice, lapse
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of time or both would constitute such a default) under, any
indenture, mortgage, deed of trust, note, bond, debenture, bank loan
or credit agreement, or any other evidence of indebtedness, agreement
or instrument to which the Company or any of the Subsidiaries is a
party or by which any of them or any of their property is or may be
bound or affected, (C) is in violation of any law, ordinance,
administrative or governmental rule or regulation applicable to the
Company or any of the Subsidiaries or of any decree of any court or
governmental agency or body having jurisdiction over the Company or
any of the Subsidiaries or (D) has received any notice of conflict
with the asserted rights of others in respect of trademarks, service
marks or other rights necessary for the conduct of their business, in
each case in which such breach, default, violation or conflict would
have a material adverse effect on the business, properties or
operations of the Company and the Subsidiaries taken as a whole;
(xiii) None of the execution, delivery or
performance of this Agreement or the Indenture, the offer, sale or
delivery of the Securities, the issuance of the Shares upon
conversion of the Securities, compliance by the Company with all
provisions hereof or consummation by the Company of the transactions
contemplated hereby (A) conflicts or will conflict with or
constitutes or will constitute a breach of, or a default (or an event
that with notice or lapse of time, or both, would constitute a
default) under, the certificate or articles of incorporation or
bylaws, or other organizational documents, of the Company or any of
the Subsidiaries or, to the best knowledge of such counsel, any
agreement, indenture, lease or other instrument to which the Company
or any of the Subsidiaries is a party or by which any of them or any
of their respective properties is bound, or any of the documents or
agreements that are included or incorporated by reference as exhibits
to the Registration Statement; (B) will, to the best knowledge of
such counsel, result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the Company or
any of the Subsidiaries; or (C) will result in any violation of any
existing law, statute, regulation, ruling (assuming compliance with
all applicable state securities and Blue Sky laws) or, to the best
knowledge of such counsel, any existing judgment, injunction, order
or decree of any court or of any federal, state or other regulatory
authority or other governmental body having jurisdiction over the
Company, any of the Subsidiaries or any of their respective
properties;
(xiv) No consent, approval, authorization or
other order of, or registration or filing with, any court, regulatory
body, administrative agency
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or other governmental body, agency, or official is required on the
part of the Company for the valid issuance and delivery of the
Securities to you pursuant to this Agreement or the issuance of the
Shares upon conversion of the Securities, other than (A) the
registration of the Securities and the Shares, under the Act, (B)
qualification of the Indenture under the Trust Indenture Act, and (C)
compliance with the securities or Blue Sky laws of various
jurisdictions;
(xv) Under conflicts of law principles observed
by the courts of the State of Texas, the courts of the State of Texas
and the federal courts of the United States applying Texas law, if
called upon to do so, will give effect to the choice of laws of the
State of New York contained in the Securities and the Indenture,
including insofar as the same applies to the provisions of the
Securities and the Indenture relating to the amount or rate of
interest contracted for, charged or received in respect of the
Securities.
(xvi) The Registration Statement and the
Prospectus (except for the financial statements and the notes thereto
and the schedules and other financial and statistical data contained
therein, as to which such counsel need not express any opinion)
comply as to form in all material respects with the requirements of
the Act;
(xvii) To the best knowledge of such counsel, (A)
other than as described in the Registration Statement and the
Prospectus there are no legal or governmental proceedings pending or
threatened against the Company or any of the Subsidiaries, or to
which the Company or any of the Subsidiaries or any of their
respective properties is subject, that are required to be described
in the Registration Statement or Prospectus and (B) there are no
agreements, contracts, indentures, leases or other documents or
instruments, that are required to be described in the Registration
Statement or the Prospectus, or filed as an exhibit to the
Registration Statement, that are not described or filed as required;
(xviii) To the best knowledge of such counsel, each
of the Company and the Subsidiaries holds all necessary governmental
authorizations, approvals, orders, licenses, certificates, franchises
and permits of and from all governmental regulatory officials and
bodies for the conduct of the material businesses in which it is
engaged and owns, or possesses adequate rights to use, all material
rights necessary for the conduct of such businesses, and to such
counsel's knowledge, none of the Company or the Subsidiaries has
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received any notice of conflict with the asserted rights of others in
respect thereto, except where the failure to hold, or the conflict
with the asserted rights of others with respect to, such
authorizations, approvals, orders, licenses, certificates, franchises
or permits, would not have a material adverse effect on the condition
(financial or other), business, properties, net worth or results of
operations of the Company and the Subsidiaries taken as a whole;
(xix) To the best knowledge of such counsel,
there are no statutes or regulations relating to the exploration for,
development, production and marketing of oil and gas that are
required to be described in the Registration Statement or Prospectus
that are not described as required;
(xx) The statements in the Registration
Statement and Prospectus, insofar as they are descriptions of
contracts, agreements or other legal documents, are accurate in all
material respects and present fairly the information required to be
shown;
(xxi) Except as described in the Prospectus, such
counsel knows of no outstanding option, warrant or other right
calling for the issuance of, and such counsel knows of no commitment,
plan or arrangement to issue, any share of capital stock of the
Company or any security convertible into or exchangeable or
exercisable for capital stock of the Company; and except as described
in the Prospectus, such counsel does not know of any holder of any
securities of the Company or any other person who has the right,
contractual or otherwise, to cause the Company to issue to such
holder or such person, or permit such holder or such person to
underwrite the sale of, any shares of capital stock of the Company
upon and as the result of the issuance and sale of the Securities to
you hereunder or the right to require registration under the Act of
an offering of shares of capital stock of the Company as a result of
the filing of the Registration Statement; and
(xxii) Although such counsel is not passing upon
and does not assume any responsibility for the accuracy or
completeness of the statements contained in the Registration
Statement and Prospectus (except with respect to paragraphs (iii),
(xvi) and (xx) above), such counsel advises you that, on the basis of
his participation in conferences with other officers and employees of
the Company, representatives of the independent accountants and
independent petroleum consultants of the Company and representatives
of the Underwriters at which the contents of the Registration
Statement and the Prospectus and related matters were discussed
(relying as to materiality to a large extent upon
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other officers and representatives of the Company), no facts have
come to his attention that lead him to believe that the Registration
Statement or any amendment thereof (other than the financial
statements and the notes thereto and the schedules and other
financial, statistical and engineering data or information included
therein and the exhibits thereto), at the time it became effective,
contained an untrue statement of a material fact or omitted to state
a material fact required to be stated therein or necessary to make
the statements therein not misleading or that the Prospectus or any
supplement thereto (other than the financial statements and the notes
thereto and the schedules and other financial, statistical and
engineering data or information included therein), as of its date,
the First Closing Date or Second Closing Date, as the case may be,
contains an untrue statement of a material fact or omits to state a
material fact necessary in order to make the statements therein, in
the light of the circumstances under which they are made, not
misleading.
In rendering his opinion as aforesaid, such counsel may rely upon an
opinion or opinions, each dated such Closing Date, of other counsel retained by
him or the Company as to federal energy regulatory matters or as to laws of any
jurisdiction other than the United States, the State of Texas, the State of New
York and the corporate laws of the State of Delaware, provided that (1) each
such local counsel is acceptable to you, (2) such reliance is expressly
authorized by each opinion so relied upon and a copy of each such opinion is
delivered to you and is in form and substance satisfactory to you, and (3) such
counsel shall state in his opinion that he believes that he and you are
justified in relying thereon.
(e) You shall have received from Baker & Botts, L.L.P.,
counsel for the Underwriters, such opinion or opinions, dated such Closing
Date, with respect to the incorporation of the Company, the validity of
the Securities, the Registration Statement, the Prospectus and other
related matters as you may require, and the Company shall have furnished
to such counsel such documents as they reasonably request for the purpose
of enabling them to pass upon such matters.
(f) You shall have received a certificate on behalf of the
Company, dated such Closing Date, of the President or any Vice President
and a principal financial or accounting officer of the Company in which
such officers, to the best of their knowledge after reasonable
investigation, shall state that the representations and warranties of the
Company in this Agreement are true and correct, that the Company has
complied with all agreements and satisfied all conditions on its part to
be performed or satisfied hereunder at or prior to such Closing Date, that
no stop order suspending the effectiveness of the Registration Statement
has been
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issued and, to the best of such officer's knowledge, no proceedings for
that purpose have been instituted or are contemplated by the Commission
and that, subsequent to the date of the most recent financial statements
in the Prospectus, there has been no material adverse change in the
financial position or results of operations of the Company and the
Subsidiaries except as set forth in or contemplated by the Prospectus or
as described in such certificate.
(g) You shall have received a letter, dated such Closing
Date, of Arthur Andersen & Co. which meets the requirements of subsection
(a) of this Section, except that the specified date referred to in such
subsection will be a date not more than five days prior to such Closing
Date for the purposes of this subsection.
(h) You shall have received a letter addressed to you and
dated the date hereof from Netherland Sewell, independent petroleum
consultants, substantially in the form heretofore approved by you.
(i) The Securities and the Shares shall have been
qualified or registered for offering and sale by you or dealers under the
securities or Blue Sky laws of such jurisdictions as you shall have
requested prior to the date hereof, and no order suspending the sale of
the Securities in any such jurisdiction shall have been issued as of or on
the Closing Date, and no proceedings for that purpose shall have been
instituted or, to your knowledge or to the knowledge of the Company, shall
be contemplated.
(j) At such Closing Date, the Securities and the Shares
shall have been approved for listing on the New York Stock Exchange,
subject to official notice of issuance.
(k) You shall have received copies of the agreements
between the Underwriters and each of John C. Snyder, Thomas J. Edelman and
John A. Fanning specified in Section 2(z).
The Company will furnish you with such conformed copies of such opinions,
certificates, letters and documents as you reasonably request.
7. Indemnification and Contribution. (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
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out of or are based upon any untrue statement or alleged untrue statement of
any material fact contained in the Registration Statement, the Prospectus, or
any amendment or supplement thereto, or any related preliminary prospectus, 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 loss, claim, damage, liability or
action as such expenses are incurred; provided, however, that the Company will
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 in or omission or alleged omission from any of such documents
in reliance upon and in conformity with written information furnished to the
Company by any Underwriter through you specifically for use therein; and
provided, further, that with respect to any untrue statement or omission or
alleged untrue statement or omission made in any preliminary prospectus, the
indemnity agreement contained in this subsection (a) shall not inure to the
benefit of any Underwriter (or any person who controls such Underwriter) from
whom the person asserting any such losses, claims, damages or liabilities
purchased the Securities concerned, to the extent that any such loss, claim,
damage or liability of such Underwriter results from the fact that there was
not sent or given to such person, at or prior to the written confirmation of
the sale of such Securities to such person, a copy of the Prospectus if the
Company had previously furnished copies thereof to such Underwriter and such
untrue statement or omission or alleged untrue statement or omission made in a
preliminary prospectus was corrected in the Prospectus.
(b) Each Underwriter will severally and not jointly indemnify and
hold harmless the Company against any losses, claims, damages or liabilities to
which the Company 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 any untrue statement or alleged untrue statement
of any material fact contained in the Registration Statement, the Prospectus,
or any amendment or supplement thereto, or any related preliminary prospectus,
or arise out of or are based upon the omission or the 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 reliance upon and in conformity with written
information furnished to the Company by such Underwriter through you
specifically for use therein, and will reimburse any legal or other expenses
reasonably incurred by the Company in connection with investigating or
defending any such loss, claim, damage, liability or action as such expenses
are incurred.
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(c) Promptly after receipt by an indemnified party under this
Section of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against the indemnifying
party under subsection (a) or (b) above, notify the indemnifying party of the
commencement thereof; but the omission so to notify the indemnifying party will
not relieve it from any liability which it may have to any indemnified party
otherwise than under subsection (a) or (b) above. In case any such action is
brought against any indemnified party and it notifies the indemnifying party of
the commencement thereof, the indemnifying party will be entitled to
participate therein and, to the extent that it may wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof, with
counsel satisfactory to such indemnified party (who 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 will not be
liable to such indemnified party under this Section for any legal or other
expenses subsequently incurred by such indemnified party in connection with the
defense thereof other than reasonable costs of investigation unless (i) the
employment of separate counsel has been specifically authorized in writing by
the indemnifying party, (ii) the indemnifying party has failed to assume the
defense and employ counsel reasonably satisfactory to the indemnified party
within a reasonable time after commencement of such action or (iii) the named
parties to any such action (including any impleaded parties) include an
indemnified and an indemnifying party and the indemnified party has been
advised in writing by separate counsel that there may be one or more legal
defenses available to such indemnified party that are different from or
additional to those available to the indemnifying party (in which case the
indemnifying party shall not have the right to assume the defense of such
action or proceeding on behalf of the indemnified party). In no event shall
the indemnifying party be liable for fees and expenses of more than one counsel
for all indemnified parties in connection with any one action or separate but
similar or related actions in the same jurisdiction arising out of the same
general allegations or circumstances.
(d) No indemnifying party shall, without the prior written consent
of the indemnified party, effect any settlement of any pending or threatened
action in respect of which any indemnified party is or could have been a party
and indemnity could have been sought hereunder by such indemnified party unless
such settlement includes an unconditional release of such indemnified party
from all liability on any claims that are the subject matter of such action.
(e) If the indemnification provided for in this Section is
unavailable or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above, then each indemnifying party shall contribute to
the amount paid or payable by such
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indemnified party as a result of the losses, claims, damages or liabilities
referred to in subsection (a) or (b) above (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company on the one
hand and the Underwriters on the other from the offering of the Securities 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 in connection
with the statements or omissions which resulted in such losses, claims, damages
or liabilities 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 shall be deemed to be in the same proportion as the total net
proceeds from the offering (before deducting expenses) received by the Company
bear to the total underwriting discounts and commissions received by the
Underwriters. 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 the Underwriters and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such untrue statement or omission. The amount paid by an indemnified
party as a result of the losses, claims, damages or liabilities referred to in
the first sentence of 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 action or claim which is the subject of
this subsection (e). Notwithstanding the provisions of this subsection (e), no
Underwriter shall be required to contribute any amount in excess of the amount
by which the total price at which the Securities underwritten by it and
distributed to the public was 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. 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 under this Section shall be in
addition to any liability which the Company may otherwise have and shall
extend, upon the same terms and conditions, to each person, if any, who
controls any Underwriter within the meaning of the Act or the Exchange Act; and
the obligations of the Underwriters under this Section 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 director of the Company, to
each officer of the Company who has signed the Registration
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Statement and to each person, if any, who controls the Company within the
meaning of the Act or the Exchange Act.
8. Default of Underwriters. If any Underwriter or Underwriters
default in their obligations to purchase Securities hereunder on either the
First Closing Date or Second Closing Date and the aggregate principal amount of
Securities that such defaulting Underwriter or Underwriters agreed but failed
to purchase does not exceed 10% of the total principal amount of Securities
that the Underwriters are obligated to purchase on such Closing Date, you may
make arrangements satisfactory to the Company for the purchase of such
Securities by other persons, including any of the Underwriters, but if no such
arrangements are made by such Closing Date, the non-defaulting Underwriters
shall be obligated severally, in proportion to their respective commitments
hereunder, to purchase the Securities that such defaulting Underwriters agreed
but failed to purchase on such Closing Date. If any Underwriter or
Underwriters so default and the aggregate principal amount of Securities with
respect to which such default or defaults occurs exceeds 10% of the total
principal amount of Securities that the Underwriters are obligated to purchase
on such Closing Date, and arrangements satisfactory to you and the Company for
the purchase of such Securities by other persons are not made within 36 hours
after such default, this Agreement will terminate without liability on the part
of any non-defaulting Underwriter or the Company, except as provided in Section
9 (provided that if such default occurs with respect to Optional Securities
after the First Closing Date, this Agreement will not terminate as to the Firm
Securities). As used in this Agreement, the term "Underwriter" includes any
person substituted for an Underwriter under this Section. Nothing herein will
relieve a defaulting Underwriter from liability for its default.
9. Survival of Certain Representations and Obligations. The
respective indemnities, agreements, representations, warranties and other
statements of the Company or its officers and of the several Underwriters set
forth in or made pursuant to this Agreement will remain in full force and
effect, regardless of any investigation, or statement as to the results
thereof, made by or on behalf of any Underwriter, the Company or any of their
respective representatives, officers or directors or any controlling person,
and will survive delivery of and payment for the Securities. If this Agreement
is terminated pursuant to Section 8 or if for any reason the purchase of the
Securities by the Underwriters is not consummated, the Company shall remain
responsible for the expenses to be paid or reimbursed by it pursuant to Section
5 and the respective obligations of the Company and the Underwriters pursuant
to Section 7 shall remain in effect, and if any Securities have been purchased
hereunder the representations and warranties in Section 2 and all obligations
under Section 5 shall also remain in effect. If the purchase of the Securities
by the Underwriters is not
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consummated for any reason other than solely because of the termination of this
Agreement pursuant to Section 8 or the occurrence of any event specified in
clause (iii), (iv) or (v) of Section 6(c), the Company will reimburse the
Underwriters for all out-of-pocket expenses (including fees and disbursements
of counsel) reasonably incurred by them in connection with the offering of the
Securities.
10. Notices. All communications hereunder will be in writing and,
if sent to the Underwriters, will be mailed, delivered or telegraphed and
confirmed to you, c/o CS First Boston Corporation, Park Avenue Plaza, 55 East
52nd Street, New York, N.Y. 10055, Attention: Investment Banking Department --
New Issue Processing Group, or, if sent to the Company, will be mailed,
delivered or telegraphed and confirmed to it at 777 Main Street, Suite 2500,
Fort Worth, Texas 76102, Attention: Peter E. Lorenzen, General Counsel;
provided, however, that any notice to an Underwriter pursuant to Section 7 will
be mailed, delivered or telegraphed and confirmed to such Underwriter.
11. Successors. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective successors and the
officers and directors and controlling persons referred to in Section 7, and no
other person will have any right or obligation hereunder.
12. Counterparts. This Agreement may be executed 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 Agreement.
13. Applicable Law. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of New York.
* * * * *
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If the foregoing is in accordance with your understanding of our
agreement, kindly sign and return to us one of the counterparts hereof,
whereupon it will become a binding agreement among the Company and the several
Underwriters in accordance with its terms.
Very truly yours,
SNYDER OIL CORPORATION
By:_______________________
President
The foregoing Underwriting Agreement is hereby
confirmed and accepted as of the date first
above written.
CS FIRST BOSTON CORPORATION
PAINEWEBBER INCORPORATED
PETRIE PARKMAN & CO., INC.
SMITH BARNEY SHEARSON INC.
BY: CS FIRST BOSTON CORPORATION
By:_________________________
Vice President
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SCHEDULE A
PRINCIPAL
UNDERWRITER AMOUNT
----------- ------------
CS First Boston Corporation . . . . . . . . . . . . . . . . . .
PaineWebber Incorporated . . . . . . . . . . . . . . . . . . .
Petrie Parkman & Co., Inc. . . . . . . . . . . . . . . . . . .
Smith Barney Shearson Inc. . . . . . . . . . . . . . . . . . .
------------
Total . . . . . . . . . . . . . . . . . . . . . . . . $100,000,000
============
A-1