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Exhibit 1(b)(1)
Union Tank Car Company
$150,000,000
7.45% Notes Due 2009
Underwriting Agreement
New York, New York
May 28, 1997
Salomon Brothers Inc
7 World Trade Center
New York, New York 10048
Morgan Stanley & Co. Incorporated
1585 Broadway
New York, New York 10036
Dear Ladies and Gentlemen:
Union Tank Car Company, a Delaware corporation (the "Company"),
proposes to sell to the underwriters named in Schedule II hereto (the
"Underwriters"), for whom you (the "Representatives") are acting as
representatives, the principal amount of its securities identified in Schedule
I hereto (the "Securities"), to be issued under an indenture dated as of
January 16, 1997 (as supplemented by the Second Supplemental Indenture, dated
as of May 28, 1997, the "Indenture"), between the Company and Harris Trust and
Savings Bank, as trustee (the "Trustee"). If the firm or firms listed in
Schedule II hereto include only the firm or firms listed in Schedule I hereto,
then the terms "Underwriters" and "Representatives", as used herein, shall each
be deemed to refer to such firm or firms.
1. Representations and Warranties. The Company represents and
warrants to, and agrees with you, that:
(a) The Company meets the requirements for the use of Form S-3
under the Securities Act of 1933 (the "Act") and has filed with the
Securities and Exchange Commission (the "Commission") a registration
statement (File No. 333-17121) on such Form, including a basic
prospectus, for registration under the Act of the offering and sale
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of the Securities. The Company may have filed one or more amendments
thereto, and may have used a Preliminary Final Prospectus, each of which
has previously been furnished to you. Such registration statement, as so
amended, has become effective. The offering of the Securities is a Delayed
Offering (as specified in Schedule I hereto) and, although the Basic
Prospectus may not include all the information with respect to the
Securities and the offering thereof required by the Act and the rules
thereunder to be included in the Final Prospectus, the Basic Prospectus
includes all such information required by the Act and the rules thereunder
to be included therein as of the Effective Date. The Company will next
file with the Commission pursuant to Rules 415 and 424(b)(2) or (5) a final
supplement to the form of prospectus included in such registration
statement relating to the Securities and the offering thereof. As filed,
such final prospectus supplement shall include all required information
with respect to the Securities and the offering thereof and, except to the
extent the Representatives shall agree in writing to a modification, shall
be in all substantive respects in the form furnished to you prior to the
Execution Time or, to the extent not completed at the Execution Time, shall
contain only such specific additional information and other changes (beyond
that contained in the Basic Prospectus and any Preliminary Final
Prospectus) as the Company has advised you, prior to the Execution Time,
will be included or made therein.
(b) On the Effective Date, the Registration Statement did or
will, and when the Final Prospectus is first filed (if required) in
accordance with Rule 424(b) and on the Closing Date, the Final Prospectus
(and any supplement thereto) will, comply in all material respects with the
applicable requirements of the Act, the Securities Exchange Act of 1934
(the "Exchange Act") and the Trust Indenture Act of 1939 (the "Trust
Indenture Act") and the respective rules thereunder; on the Effective Date,
the Registration Statement did not or will not contain any untrue statement
of a material fact or omit to state any material fact required to be stated
therein or necessary in order to make the statements therein not
misleading; on the Effective Date and on the Closing Date the Indenture did
or will comply in all material respects with the requirements of the Trust
Indenture Act and the rules thereunder; and, on the Effective Date, the
Final Prospectus, if not filed pursuant to Rule 424(b), did not or will
not, and on the date of any filing pursuant to Rule 424(b) and on the
Closing Date, the Final Prospectus (together with any supplement thereto)
will not, include any untrue statement of a material fact or omit to state
a material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading;
provided, however, that the Company makes no representations or warranties
as to (i) that part of the Registration Statement which shall constitute
the Statement of Eligibility and Qualification (Form T-1) under the Trust
Indenture Act of the Trustee or (ii) the information contained in or
omitted from the Registration Statement or the Final Prospectus (or any
supplement thereto) in reliance upon and in conformity with information
furnished in writing to the Company by or on behalf of any Underwriter
through the Representatives specifically for inclusion in the Registration
Statement or the Final Prospectus (or any supplement thereto), it being
understood and agreed that the only information furnished by the
Representatives consists of (i) the stabilization language
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appearing on the top of page S-2 and (ii) the information relating to the
Underwriters set forth under the caption "Underwriting," each as contained
in the Preliminary Final Prospectus and the Final Prospectus.
(c) The terms which follow, when used in this Agreement, shall
have the meanings indicated. The term "the Effective date" shall mean each
date that the Registration Statement and any post-effective amendment or
amendments thereto became or become effective and each date after the date
hereof on which a document incorporated by reference in the Registration
Statement is filed. "Execution Time" shall mean the date and time that
this Agreement is executed and delivered by the parties hereto. "Basic
Prospectus" shall mean the prospectus referred to in paragraph (a) above
contained in the Registration Statement at the Effective Date including, in
the case of a Non-Delayed Offering, any Preliminary Final Prospectus.
"Preliminary Final Prospectus" shall mean any preliminary prospectus
supplement to the Basic Prospectus which describes the Securities and the
offering thereof and is used prior to filing of the Final Prospectus.
"Final Prospectus" shall mean the prospectus supplement relating to the
Securities that is first filed pursuant to Rule 424(b) after the Execution
Time, together with the Basic Prospectus or, if, in the case of a
Non-Delayed Offering, no filing pursuant to Rule 424(b) is required, shall
mean the form of final prospectus relating to the Securities, including the
Basic Prospectus, included in the Registration Statement at the Effective
Date. "Registration Statement" shall mean the registration statement
referred to in paragraph (a) above, including incorporated documents,
exhibits and financial statements, as amended at the Execution Time (or, if
not effective at the Execution Time, in the form in which it shall become
effective) and, in the event any post-effective amendment thereto becomes
effective prior to the Closing Date (as hereinafter defined), shall also
mean such registration statement as so amended. Such term shall include
any Rule 430A Information deemed to be included therein at the Effective
Date as provided by Rule 430A. "Rule 415", "Rule 424", "Rule 430A" and
"Regulation S-K" refer to such rules or regulation under the Act. "Rule
430A Information" means information with respect to the Securities and the
offering thereof permitted to be omitted from the Registration Statement
when it becomes effective pursuant to Rule 430A. Any reference herein to
the Registration Statement, the Basic Prospectus, any Preliminary Final
Prospectus or the Final Prospectus shall be deemed to refer to and include
the documents incorporated by reference therein pursuant to Item 12 of Form
S-3 which were filed under the Exchange Act on or before the Effective Date
of the Registration Statement or the issue date of the Basic Prospectus,
any Preliminary Final Prospectus or the Final Prospectus, as the case may
be; and any reference herein to the terms "amend", "amendment" or
"supplement" with respect to the Registration Statement, the Basic
Prospectus, any Preliminary Final Prospectus or the Final Prospectus shall
be deemed to refer to and include the filing of any document under the
Exchange Act after the Effective Date of the Registration Statement or the
issue date of the Basic Prospectus, any Preliminary Final Prospectus or the
Final Prospectus, as the case may be, deemed to be incorporated therein by
reference. A "Non-Delayed Offering" shall mean an offering of securities
which is intended to commence promptly
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after the effective date of a registration statement, with the result that,
pursuant to Rules 415 and 430A, all information (other than Rule 430A
Information) with respect to the securities so offered must be included in
such registration statement at the effective date thereof. A "Delayed
Offering" shall mean an offering of securities pursuant to Rule 415 which
does not commence promptly after the effective date of a registration
statement, with the result that only information required pursuant to Rule
415 need be included in such registration statement at the effective date
thereof with respect to the securities so offered. Whether the offering of
the Securities is a Non-Delayed Offering or a Delayed Offering shall be set
forth in Schedule I hereto.
(d) The consolidated financial statements incorporated by
reference in the Registration Statement and Final Prospectus present fairly
the consolidated financial position of the Company and its subsidiaries as
at the dates indicated and the consolidated results of their operations and
cash flows for the periods specified and have been prepared in conformity
with generally accepted accounting principles applied on a consistent basis
during the periods involved, except as indicated therein, and the
supporting schedules incorporated by reference in the Registration
Statement present fairly the information required to be stated therein.
(e) The documents incorporated by reference in the Final
Prospectus, at the time they were or hereafter are filed with the
Commission, complied and will comply in all material respects with the
requirements of the Exchange Act, and the rules and regulations thereunder.
(f) Since the respective dates as of which information is given
in the Registration Statement and the Final Prospectus, except as otherwise
stated therein or contemplated thereby, there has been no material adverse
change in the condition, financial or otherwise, results of operations or
general affairs of the Company and its subsidiaries, taken as a whole.
(g) The Company and each Significant Subsidiary (with such term
having the meaning attributed to it under Rule 405 under the Act) of the
Company has been duly incorporated and is validly existing as a corporation
in good standing under the laws of the jurisdiction in which it is
chartered or organized, with full corporate power and authority to own its
properties and conduct its business as described in the Final Prospectus,
and is duly qualified to do business as a foreign corporation and is in
good standing under the laws of each jurisdiction which requires such
qualification wherein it owns or leases material properties or conducts
material business, except in such jurisdictions in which the failure to so
qualify would not have a material adverse effect on the Company and its
subsidiaries taken as a whole. The Company owns either directly or
indirectly, all of the issued and outstanding capital stock of its
subsidiaries, free and clear of any lien, adverse claim, security interest
or other encumbrance.
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(h) The execution and delivery by the Company of this Agreement,
the Indenture and the Securities, the consummation by the Company of the
transactions herein and therein contemplated, and the compliance by the
Company with the terms hereof and thereof do not and will not conflict
with, or result in a breach of any of the terms or provisions of, or
constitute a default under, the Certificate of Incorporation or By-Laws, as
amended, of the Company, or any of its subsidiaries, or any material
indenture, mortgage, or other agreement or instrument to which the Company
or any of its subsidiaries is a party or by which any of its properties are
bound, or any applicable law, rule, regulation, judgment, order or decree
of any government, governmental instrumentality or court, domestic or
foreign, having jurisdiction over the Company or any of its subsidiaries or
any of its properties; and, assuming due authorization, execution and
delivery by all parties thereto other than the Company, no consent,
approval, authorization, order or license of, or filing with or notice to
any government, governmental instrumentality, regulatory body or authority
or court, domestic or foreign, is required for the valid authorization,
issuance and delivery of the Securities, the valid authorization,
execution, delivery and performance by the Company of this Agreement and
the Indenture or the consummation by the Company of the transactions
contemplated by this Agreement, the Indenture and the Securities, except
(w) such as are required under the Act, the Trust Indenture Act and the
securities or Blue Sky laws of the various states.
(i) This Agreement and the Indenture, assuming due authorization,
execution and delivery by the other parties thereto, have each been duly
authorized by the Company and, when executed and delivered by the Company,
will constitute valid and binding obligations of the Company. The
Securities and the Indenture will conform in all material respects to the
descriptions thereof in the Final Prospectus.
(j) Ernst & Young LLP, who reported on the consolidated financial
statements of the Company for the year ended December 31, 1996, which
statements are incorporated by reference in the Registration Statement and
Final Prospectus, were, as of the date of its report on such consolidated
financial statements, and are, as of the date hereof, independent auditors
as required by the Act and the rules and regulations thereunder.
(k) The Securities have been duly authorized by the Company and
when duly executed and delivered by the Trustee and the Company in
accordance with the terms of the Indenture and this Agreement, will be duly
issued under such Indenture and will constitute valid and binding
obligations of the Company, and the holders thereof will be entitled to the
benefits of the Indenture.
2. Purchase and Sale. Subject to the terms and conditions and in reliance
upon the representations and warranties herein set forth, the Company agrees to
sell each Underwriter, and each Underwriter agrees, severally and not jointly,
to purchase from the Company, at the purchase price set forth in Schedule I
hereto the principal amount of the Securities set forth
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opposite such Underwriter's name in Schedule II hereto, except that, if
Schedule I hereto provides for the sale of Securities pursuant to delayed
delivery arrangements, the respective principal amounts of Securities to be
purchased by the Underwriters shall be as set forth in Schedule II hereto.
Securities to be purchased by the Underwriters are herein called the
"Underwriters' Securities".
3. Delivery and Payment. Delivery of and payment for the Underwriters'
Securities shall be made on the date and at the time specified in Schedule I
hereto (or such later date not later than five business days after such
specified date as the Representatives shall designate), which date and time may
be postponed by agreement between the Representatives and the Company (such
date and time of delivery and payment for the Underwriters' Securities being
herein called the "Closing Date"). Delivery of the Underwriters' Securities
shall be made to the Representatives for the respective accounts of the several
Underwriters against payment by the several Underwriters through the
Representatives of the purchase price thereof to or upon the order of the
Company by certified or official bank check or checks drawn on or by a New York
Clearing House bank and payable in next day funds. Delivery of the
Underwriters' Securities shall be made at such location as the Representatives
shall reasonably designate at least one business day in advance of the Closing
Date and payment for the Securities shall be made at the office specified in
Schedule I hereto. Certificates for the Underwriters' Securities shall be
registered in such names and in such denominations as the Representatives may
request not less than three full business days in advance of the Closing Date.
The Company agrees to have the Underwriters' Securities available for
inspection, checking and packaging by the Representatives in New York, New
York, not later than 1:00 PM on the business day prior to the Closing Date.
4. Agreements. The Company agrees with you that:
(a) The Company will use its best efforts to cause the Registration
Statement, if not effective at the Execution Time, and any amendment
thereto, to become effective. Prior to the termination of the offering of
the Securities, the Company will not file any amendment of the Registration
Statement or supplement (including the Final Prospectus or any Preliminary
Final Prospectus) to the Basic Prospectus unless the Company has furnished
you a copy for your review prior to filing and will not file any such
proposed amendment or supplement to which you reasonably object. Subject
to the foregoing sentence, the Company will cause the Final Prospectus,
properly completed and any supplement thereto to be filed with the
Commission pursuant to the applicable paragraph of Rule 424(b) within the
time period prescribed and will provide evidence satisfactory to the
Representatives of such timely filing. The Company will promptly advise
the Representatives (i) when the Registration Statement, if it is not
effective at the Execution Time, and any amendment thereto, shall have
become effective, (ii) when the Final Prospectus, and any supplement
thereto, shall have been filed with the Commission pursuant to Rule 424(b),
(iii) when, prior to termination of the offering of the Securities, any
amendment to the Registration Statement shall have been filed or become
effective,
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(iv) of any request by the Commission for any amendment of the Registration
Statement or supplement to the Final Prospectus or for any additional
information, (v) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or the
institution or threatening of any proceeding for that purpose and (vi) of
the receipt by the Company of any notification with respect to the
suspension of the qualification of the Securities for sale in any
jurisdiction or the initiation or threatening of any proceeding for such
purpose. The Company will use its best efforts to prevent the issuance of
any such stop order and, if issued, to obtain as soon as possible the
withdrawal thereof.
(b) 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 Final Prospectus as then supplemented would include any 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 shall be necessary to amend
the Registration Statement or supplement the Final Prospectus to comply
with the Act or the Exchange Act or the respective rules and regulations
thereunder, the Company promptly will (i) prepare and file with the
Commission, subject to paragraph (a) of this Section 4, an amendment or
supplement which will correct such statement or omission or an amendment
which will effect such compliance and (ii) supply any supplemented
Prospectus to you in such quantities as you may reasonably request.
(c) As soon as practicable, the Company will make generally
available to its security holders and to the Underwriters an earnings
statement or statements of the Company and its subsidiaries which will
satisfy the provisions of Section 11(a) of the Act and the applicable rules
and regulations thereunder.
(d) The Company will furnish to you and your counsel, without charge,
signed copies of the Registration Statement (including exhibits thereto)
and, so long as delivery of a prospectus by an Underwriter or a dealer may
be required by the Act, as many copies of each Preliminary Final Prospectus
and the Final Prospectus and any amendments thereof and supplements thereto
as you may reasonably request. The Company will pay the expenses of
printing all documents relating to the offering.
(e) The Company will cooperate with you and your counsel to arrange
for the qualification of the Securities for sale under the laws of such
jurisdictions as you may reasonably designate, will maintain such
qualifications in effect so long as required for the distribution of the
Securities and will cooperate with you and your counsel to arrange for the
determination of the legality of the Securities for purchase by
institutional investors; provided, however, that the Company will not be
required to qualify to do business in any jurisdiction in order to effect
such qualification.
(f) Between the date of this Agreement and the Closing Date, the
Company will not, without the consent of the Representatives, offer, sell
or contract to sell, or
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otherwise dispose of, directly or indirectly, or announce the offering of,
any debt securities issued or guaranteed by the Company (other than the
Securities).
(g) The Company confirms as of the date hereof that it is in
compliance with all provisions of Section 1 of Laws of Florida, Chapter 92-
198, An Act Relating to Disclosure of Doing Business with Cuba, and the
Company further agrees, if necessary, that if the Company commences
engaging in business with the government of Cuba or with any person or
affiliate located in Cuba after the date the Registration Statement becomes
or has become effective with the Commission or with the Florida Department
of Banking and Finance (the "Department"), whichever date is later, or if
the information reported in the Final Prospectus, if any, concerning the
Company's business with Cuba or with any person or affiliate located in
Cuba changes in any material way, the Company will provide the Department
notice of such business or change, as appropriate, in a form acceptable to
the Department.
5. Conditions to the Obligations of Salomon Brothers Inc and Morgan
Stanley & Co. Incorporated. Your obligations to purchase the Securities shall
be subject to the accuracy of the representations and warranties on the part of
the Company contained herein as of the Execution Time and the Closing Date, to
the accuracy of the statements of the Company made in any certificates
delivered pursuant to the provisions hereof, to the performance by the Company
of its obligations hereunder and to the following additional conditions:
(a) The Registration Statement shall have become effective not
later than (i) 5:00 p.m., New York City time, on the date of determination
of the public offering price, if such determination occurred at or prior to
3:00 p.m., New York City time, on such date or (ii) 12:00 noon, New York
City time, on the business day following the day on which the public
offering price was determined, if such determination occurred after 3:00
p.m., New York City time, on such date; if filing of the Final Prospectus,
or any supplement thereto, is required pursuant to Rule 424(b), the Final
Prospectus, and any such supplement, will be filed in the manner and within
the time period required by Rule 424(b); and 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 threatened.
(b) The Company shall have furnished to the Representatives the
opinion of Neal, Gerber & Eisenberg, counsel to the Company (incorporating
and relying upon the opinion of Robert W. Webb, Esq., general counsel of
the Company, and Osler, Hoskin & Harcourt, special Canadian counsel to the
Company, as to Canadian law matters), dated the Closing Date, to the effect
that:
(i) the Company and each of its Significant Subsidiaries has
been duly incorporated and is validly existing as a corporation in
good standing under the laws of the jurisdiction in which it is
chartered or organized, with full corporate power and authority to
own its properties and conduct its business as described
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in the Final Prospectus, and is duly qualified to do business as a foreign
corporation and is in good standing under the laws of each jurisdiction
which requires such qualification wherein it owns or leases material
properties or conducts material business, except in such jurisdictions in
which the failure to so qualify would not have a material adverse effect on
the Company and its subsidiaries taken as a whole;
(ii) all the outstanding shares of capital stock of each of the
Company's subsidiaries have been duly and validly authorized and issued and
are fully paid and nonassessable, and, all such capital stock is owned
directly or indirectly by the Company, free and clear of any perfected
security interest and, to the knowledge of such counsel, after due inquiry,
any other security interest, claims, liens or encumbrances;
(iii) the Indenture has been duly authorized, executed and delivered
by the Company, has been duly qualified under the Trust Indenture Act, and
assuming due authorization, execution and delivery thereof by the Trustee,
the Indenture constitutes a legal, valid and binding obligation of the
Company enforceable against the Company in accordance with its terms,
except as may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting enforcement of creditors' rights
generally and by general principles of equity (regardless of whether
enforcement is considered in a proceeding in equity or at law);
(iv) to the best knowledge of such counsel, there is no pending or
threatened action, suit or proceeding before any court or governmental
agency, authority or body or any arbitrator involving the Company or any of
its subsidiaries, of a character required to be disclosed in the
Registration Statement which is not adequately disclosed in the Final
Prospectus, and there is no franchise, contract or other document of a
character required to be described in the Registration Statement or Final
Prospectus, or to be filed as an exhibit, which is not described or filed
as required; and the statements included or incorporated in the Final
Prospectus describing any legal proceedings or material contracts or
agreements relating to the Company fairly summarize such matters;
(v) the Registration Statement has become effective under the Act; any
required filing of the Basic Prospectus, any Preliminary Final Prospectus
and the Final Prospectus, and any supplements thereto, pursuant to Rule
424(b) has been made in the manner and within the time period required by
Rule 424(b); to the best knowledge of such counsel, no stop order
suspending the effectiveness of the Registration Statement has been issued,
no proceedings for that purpose have been instituted or threatened, and the
Registration Statement and the Final Prospectus (other than the financial
statements and other financial and statistical information contained
therein as to which such counsel need express no opinion) comply as
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to form in all material respects with the applicable requirements of the
Act, the Exchange Act and the Trust Indenture Act and the respective rules
thereunder; respective rules thereunder;
(vi) this Agreement has been duly authorized, executed and delivered
by the Company and, assuming due authorization, execution and delivery by
you, constitutes a valid and binding obligation of the Company, enforceable
against the Company in accordance with its terms, except (i) as may be
limited by bankruptcy, insolvency, reorganization, moratorium or other
similar laws affecting enforcement of creditors' rights generally and by
general principles of equity (regardless of whether enforcement is
considered in a proceeding in equity or at law) and (ii) as to provisions
of this Agreement relating to indemnification or contribution for
liabilities arising under the Act, as to which such counsel need express no
opinion;
(vii) no authorization, approval, consent, order or license of or
filing with or notice to any government, governmental instrumentality,
regulatory body or authority or court is required for the valid
authorization, execution, delivery and performance by the Company of the
Securities, this Agreement and the Indenture or the consummation by the
Company of the transactions contemplated by this Agreement and the
Indenture, except such as have been obtained under the Act and the Trust
Indenture Act and such as may be required under the blue sky laws of any
jurisdiction in connection with the purchase and distribution of the
Securities by you and such other approvals (specified in such opinion) as
have been obtained;
(viii) neither the execution and delivery of the Indenture, the
issue and sale of the Securities, nor the consummation of any other of the
transactions herein contemplated nor the fulfillment of the terms hereof
will conflict with, result in a breach or violation of, or constitute a
default under any law or the charter or by-laws of the Company or the terms
of any indenture or other agreement or instrument known to such counsel and
to which the Company or any of its subsidiaries is a party or bound or any
judgment, order or decree known to such counsel to be applicable to the
Company or any of its subsidiaries of any court, regulatory body,
administrative agency, governmental body or arbitrator having jurisdiction
over the Company or any of its subsidiaries;
(ix) the Company is not an "investment company" or a company
"controlled" by an "investment company" within the meaning of the
Investment Company Act of 1940, as amended;
(x) on the Closing Date, assuming due execution and delivery of the
Securities by the Trustee and the Company, the Securities when issued
against payment therefor as provided herein will constitute valid and
binding obligations of the Company, enforceable against the Company, in
accordance with their
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terms, except as may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting enforcement of creditors' rights
generally and by general principles of equity (regardless of whether
enforcement is considered in a proceeding in equity or at law), and the
holders of the Securities will be entitled to the benefits of the
Indenture; and
(xi) the Indenture and the Securities conform in all material
respects to the descriptions thereof contained in the Final Prospectus.
In passing on the form of the Registration Statement and the Final Prospectus
and each amendment and supplement thereto, such counsel may state that it has
not independently verified the accuracy, completeness or fairness of the
statements made or included therein and takes no responsibility therefor and
that such opinion is based upon such counsel's examination of the Registration
Statement, the Final Prospectus as amended or supplemented, its activities in
connection with the preparation thereof and its participation in conferences
with certain officers and employees of the Company, its subsidiaries and its
affiliates and with representatives of Ernst & Young LLP and any others
referred to in such opinion, and subject to the same qualifications, such
counsel may also state that, although they are not passing upon, and do not
assume any responsibility for, the accuracy, completeness or fairness of the
statements contained in the Registration Statement and Final Prospectus and
have not made any independent check or verification thereof, nothing has come
to their attention in their examination of the Registration Statement, their
participation in the preparation thereof and participation in the
above-referenced conferences that has caused them to believe that the
Registration Statement, 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
the Final Prospectus, as of its date and as of the Closing Date, 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.
(c) You shall have received from Mayer, Brown & Platt, your special
counsel, such opinion or opinions, dated the Closing Date, with respect to the
issuance and sale of the Securities, the Indenture, the Registration Statement,
the Final Prospectus and other related matters as you may reasonably require,
and the Company shall have furnished to such counsel such documents as they
request for the purpose of enabling them to pass upon such matters.
(d) The Company shall have furnished to you a certificate of the Company,
signed by the President or any Vice President and the principal financial
officer of the Company, dated the Closing Date, to the effect that the signers
of such certificate have carefully examined the Registration Statement, the
Final Prospectus, any supplement to the Final Prospectus and this Agreement and
that:
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(i) the representations and warranties of the Company in this
Agreement are true and correct in all material respects on and as of
the Closing Date with the same effect as if made on the Closing Date
and the Company has complied with all the agreements and satisfied
all the conditions on its part to be performed or satisfied at or
prior to the Closing Date;
(ii) no stop order suspending the effectiveness of the
Registration Statement has been issued and, to the Company's
knowledge, no proceedings for that purpose have been instituted or
threatened; and
(iii) since the date of the most recent financial statements
included and/or incorporated by reference in the Final Prospectus,
there has been no material adverse change in the condition (financial
or other), earnings, business or properties of the Company and its
subsidiaries, whether or not arising from transactions in the
ordinary course of business, except as set forth in or contemplated
in the Final Prospectus (exclusive of any supplement thereto).
(e) At the Execution Time and at the Closing Date, Ernst & Young LLP shall
have furnished to you a letter or letters, dated, respectively, as of the
Execution Time and as of the Closing Date, in form and substance satisfactory
to you, confirming that they are independent auditors within the meaning of the
Act and the applicable published rules and regulations thereunder and stating
in effect that:
(i) in their opinion the audited financial statements and financial
statement schedules included or incorporated in the Registration Statement
and the Final Prospectus and reported on by them comply in form in all
material respects with the applicable accounting requirements of the Act and
the Exchange Act and the related published rules and regulations;
(ii) on the basis of a reading of the latest unaudited financial
statements made available by the Company and its subsidiaries; carrying out
certain specified procedures (but not an examination in accordance with
generally accepted auditing standards) which would not necessarily reveal
matters of significance with respect to the comments set forth in such
letter; a reading of the minutes of the meetings of the stockholders,
directors and executive committees of the Company and the Subsidiaries; and
inquiries of certain officials of the Company who have responsibility for
financial and accounting matters of the Company and its subsidiaries as to
transactions and events subsequent to the date of the most recent audited
financial statements in or incorporated in the Final Prospectus, nothing
came to their attention which caused them to believe that:
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(1) any unaudited financial statements included or incorporated in
the Registration Statement and the Final Prospectus do not comply in form
in all material respects with applicable accounting requirements and with
the published rules and regulations of the Commission with respect to
financial statements included or incorporated in quarterly reports on
Form-10-Q under the Exchange Act; and said unaudited financial statements
are not in conformity with generally accepted accounting principles applied
on a basis substantially consistent with that of the audited financial
statements included or incorporated in the Registration Statement and the
Final Prospectus;
(2) with respect to the period subsequent to the date of the most
recent financial statements (other than any capsule information), audited
or unaudited, in or incorporated in the Registration Statement and the
Final Prospectus, there were any changes, at a specified date not more than
five business days prior to the date of the letter, in the borrowed debt of
the Company and its subsidiaries or capital stock of the Company, decreases
in the stockholders' equity of the Company and its subsidiaries as compared
with the amounts shown on the most recent consolidated balance sheet
included or incorporated in the Registration Statement and the Final
Prospectus, or for the period from the date of the most recent financial
statements included or incorporated in the Registration Statement and the
Final Prospectus to such specified date there were any decreases, as
compared with the corresponding period in the preceding year or quarter, as
the case may be in total revenues from net sales and services, or in income
before income taxes or net income, of the Company and its subsidiaries,
except in all instances for changes or decreases set forth in such letter,
in which case the letter shall be accompanied by an explanation by the
Company as to the significance thereof unless said explanation is not
deemed necessary by the Representatives; or
(3) the amounts included in any unaudited "capsule" information
included or incorporated in the Registration Statement and the Final
Prospectus do not agree with the amounts set forth in the unaudited
financial statements for the same periods or were not determined on a basis
substantially consistent with that of the corresponding amounts in the
audited financial statements included or incorporated in the Registration
Statement and the Final Prospectus; and
(iii) they have performed certain other specified procedures as a result
of which they determined that certain information of an accounting, financial
or statistical nature (which is limited to accounting, financial or statistical
information derived from the general accounting records of the Company and its
subsidiaries) set forth in the Registration Statement and the Final Prospectus
and
-13-
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in Exhibit 12 to the Registration Statement, including the information
included or incorporated in the Company's Annual Report on Form 10-K,
incorporated in the Registration Statement and the Prospectus, and the
information included in the "Management's Discussion and Analysis of
Financial Condition and Results of Operations" included or
incorporated in the Company's Quarterly Reports on Form 10-Q,
incorporated in the Registration Statement and the Final Prospectus,
agrees with the accounting records of the Company and its
subsidiaries, excluding any questions of legal interpretation.
References to the Final Prospectus in this paragraph (e) include any
supplement thereto at the date of the letter.
(f) Subsequent to the Execution Time or, if earlier, the dates as of
which information is given in the Registration Statement (exclusive of any
amendment thereof) and the Final Prospectus (exclusive of any supplement
thereto), there shall not have been (i) any change or decrease specified in
the letter or letters referred to in paragraph (e) of this Section 5 or
(ii) any change, or any development involving a prospective change, in or
affecting the business or properties of the Company and its subsidiaries
the effect of which, in any case referred to in clause (i) or (ii) above,
is, in the judgment of the Representatives, so material and adverse as to
make it impractical or inadvisable to proceed with the offering or delivery
of the Securities as contemplated by the Registration Statement (exclusive
of any amendment thereof) and the Final Prospectus (exclusive of any
supplement thereto).
(g) On the Closing Date, the Securities shall be rated at least "A3"
by Moody's Investor's Service Inc. and "A" by Standard & Poor's
Corporation, and the Company shall have delivered to the Representatives a
letter, dated the Closing Date, from each such rating agency, or other
evidence satisfactory to the Representatives, confirming that the
Securities have such ratings.
(h) Subsequent to the Execution Time and prior to the Closing Date,
there shall not have occurred any downgrading nor shall any notice have
been given of (i) any intended or potential downgrading or (ii) any review
or possible change in the rating accorded the Company's debt securities by
the above-mentioned rating agencies as of the Execution Time.
(i) The Company shall have entered into the Indenture and the
Representatives shall have received original counterparts thereof and of
all other documents and agreements entered into in connection therewith.
(j) Prior to the Closing Date, the Company shall have furnished to
you such further information, certificates and documents as you may
reasonably request.
-14-
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If any of the conditions specified in this Section 5 shall not have been
fulfilled in all material respects when and as provided in this Agreement, or if
any of the opinions and certificates mentioned above or elsewhere in this
Agreement shall not be in all material respects reasonably satisfactory in form
and substance to you and your counsel, this Agreement and all your obligations
hereunder may be canceled at, or at any time prior to, the Closing Date by you.
Notice of such cancellation shall be given to the Company in writing or by
telephone or telegraph confirmed in writing.
6. Reimbursement of the Underwriters' Expenses. If the sale of the
Securities provided for herein is not consummated because any condition to your
obligation set forth in Section 5 hereof is not satisfied, because of any
termination pursuant to Section 9 hereof or because of any refusal, inability or
failure on the part of the Company to perform any agreement herein or comply
with any provision hereof other than by reason of a default by you, the Company
will reimburse you upon demand for all out-of-pocket expenses (including
reasonable fees and disbursements of counsel) that shall have been incurred by
you in connection with the proposed purchase and sale of the Securities.
7. Indemnification and Contribution. (a) The Company agrees to indemnify
and hold harmless each Underwriter, the directors, officers, employees and
agents of each Underwriter and each person who controls any Underwriter within
the meaning of either the Act or the Exchange Act against any and all losses,
claims, damages or liabilities, joint or several, to which they or any of them
may become subject under the Act, the Exchange Act or other Federal or state
statutory law or regulation, at common law 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 a material
fact contained in the registration statement for the registration of the
Securities as originally filed or in any amendment thereof, or in the Basic
Prospectus, any Preliminary Final Prospectus or the Final Prospectus, or in any
amendment thereof 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
agrees to reimburse each such indemnified party, as incurred, for any legal or
other expenses reasonably incurred by them in connection with investigating or
defending any such loss, claim, damage, liability or action; 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 any such untrue
statement or alleged untrue statement or omission or alleged omission made
therein in reliance upon and in conformity with written information furnished to
the Company by or on behalf of any Underwriter through the Representatives
specifically for inclusion therein, it being understood and agreed that the only
information furnished by the Representatives consists of (i) the stabilization
language appearing on the top of page S-2 and (ii) the information relating to
the Underwriters set forth under the caption "Underwriting," each as contained
in the Preliminary Final Prospectus and the Final Prospectus; provided, further
that such indemnity with respect to any Preliminary Final Prospectus shall not
inure to your benefit (or to the benefit of any person controlling you) if the
person asserting any such loss, claim, damage or liability purchased the
securities which are the subject thereof did not receive a copy of the Final
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Prospectus (or any amendments thereof or supplements thereto), excluding
documents incorporated therein by reference, at or prior to the confirmation of
the sale of such Securities to such person in any case where such delivery is
required by the Act and the untrue statement or omission of a material fact in
such Preliminary Final Prospectus was corrected in the Final Prospectus (or any
amendments thereof or supplements thereto). This indemnity agreement will be
in addition to any liability which the Company may otherwise have.
(b) Each Underwriter severally agrees to indemnify and hold harmless
the Company, each of its directors, each of its officers who signs the
Registration Statement, and each person who controls the Company within the
meaning of either the Act or the Exchange Act, to the same extent as the
foregoing indemnity from the Company to each Underwriter, but only with
reference to written information relating to such Underwriter furnished to the
Company by or on behalf of such Underwriter through the Representatives
specifically for inclusion in the documents referred to in the foregoing
indemnity. This indemnity agreement will be in addition to any liability which
any Underwriter may otherwise have.
(c) Promptly after receipt by an indemnified party under this Section
7 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 this
Section 7, notify the indemnifying party in writing of the commencement thereof;
but the failure so to notify the indemnifying party (i) will not relieve it from
liability under paragraph (a) or (b) above unless and to the extent it did not
otherwise learn of such action and such failure results in the forfeiture by the
indemnifying party of substantial rights and defenses and (ii) will not, in any
event, relieve the indemnifying party from any obligations to any indemnified
party other than the indemnification obligation provided in paragraph (a) or (b)
above. The indemnifying party shall be entitled to appoint counsel of the
indemnifying party's choice at the indemnifying party's expense to represent the
indemnified party in any action for which indemnification is sought (in which
case the indemnifying party shall not thereafter be responsible for the fees and
expenses of any separate counsel retained by the indemnified party or parties
except as set forth below); provided, however, that such counsel shall be
satisfactory to the indemnified party. Notwithstanding the indemnifying party's
election to appoint counsel to represent the indemnified party in an action, the
indemnified party shall have the right to employ separate counsel (including
local counsel), and the indemnifying party shall bear the reasonable fees, costs
and expenses of such separate counsel if (i) the use of counsel chosen by the
indemnifying party to represent the indemnified party would present such counsel
with a conflict of interest, (ii) the actual or potential defendants in, or
targets of, any such action include both the indemnified party and the
indemnifying party and the indemnified party shall have reasonably concluded
that there may be legal defenses available to it and/or other indemnified
parties which are different from or additional to those available to the
indemnifying party, (iii) the indemnifying party shall not have employed counsel
satisfactory to the indemnified party to represent the indemnified party within
a reasonable time after notice of the institution of such action or (iv) the
indemnifying party shall authorize the indemnified party to employ separate
counsel at the expense of the indemnifying party. An indemnifying party will
not, without the prior written consent of the indemnified parties, settle or
compromise or consent to the entry of any judgment with respect to any pending
or threatened
-16-
17
claim, action, suit or proceeding in respect of which indemnification or
contribution may be sought hereunder (whether or not the indemnified parties
are actual or potential parties to such claim or action) unless such
settlement, compromise or consent includes an unconditional release of each
indemnified party from all liability arising out of such claim, action, suit or
proceeding.
(d) In the event that the indemnity provided in paragraph (a) or (b)
of this Section 7 is unavailable to or insufficient to hold harmless an
indemnified party for any reason, the Company and the Underwriters agree to
contribute to the aggregate losses, claims, damages and liabilities (including
legal or other expenses reasonably incurred in connection with investigating or
defending same) (collectively "Losses") to which the Company and one or more of
the Underwriters may be subject in such proportion as is appropriate to reflect
the relative benefits received by the Company and by the Underwriters from the
offering of the securities; provided, however, that in no case shall any
Underwriter (except as may be provided in any agreement among underwriters
relating to the offering of the Securities) be responsible for any amount in
excess of the underwriting discount or commission applicable to the Securities
purchased by such Underwriter hereunder. If the allocation provided by the
immediately preceding sentence is unavailable for any reason, the Company and
the Underwriters shall contribute in such proportion as is appropriate to
reflect not only such relative benefits but also the relative fault of the
Company and of the Underwriters in connection with the statements or omissions
which resulted in such Losses as well as any other relevant equitable
considerations. Benefits received by the Company shall be deemed to be equal to
the total net proceeds from the Offering (before deducting expenses), and
benefits received by the Underwriters shall be deemed to be equal to the total
underwriting discounts and commissions, in each case as set forth on the cover
page of the Final Prospectus. Relative fault shall be determined by reference
to whether any alleged untrue statement or omission relates to information
provided by the Company or the Underwriters. The Company and the Underwriters
agree that it would not be just and equitable if contribution were determined by
pro rata allocation or any other method of allocation which does not take
account of the equitable considerations referred to above. Notwithstanding the
provisions of this paragraph (d), 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. For purposes of this Section 7, each person who controls an
Underwriter within the meaning of either the Act or the Exchange Act and each
director, officer, employee and agent of an Underwriter shall have the same
rights to contribution as such Underwriter, and each person who controls the
Company within the meaning of either the Act or the Exchange Act, each officer
of the Company who shall have signed the Registration Statement and each
director of the Company shall have the same rights to contribution as the
Company, subject in each case to the applicable terms and conditions of this
paragraph (d).
8. Termination. This Agreement shall be subject to termination in your
absolute discretion by notice given to the Company prior to delivery of and
payment for the Securities, if prior to such time (i) trading in securities
generally on the New York Stock Exchange shall have been suspended or limited or
minimum prices shall have been established on such Exchange, (ii) a banking
moratorium shall have been declared either by Federal, New York State
-17-
18
or Illinois State authorities or (iii) there shall have occurred any outbreak
or material escalation of hostilities or other calamity or crisis the effect of
which on the financial markets of the United States is such as to make it, in
your judgment, impracticable to market the Securities.
9. Representations and Indemnities to Survive. The respective agreements,
representations, warranties, indemnities and other statements of the Company or
its officers and of you set forth in or made pursuant to this Agreement will
remain in full force and effect, regardless of any investigation made by or on
behalf of you or the Company or any of its officers, directors or controlling
persons referred to in Section 7 hereof, and will survive delivery of and
payment for the Securities. The provisions of Sections 6 and 7 hereof shall
survive the termination or cancellation of this Agreement.
10. Notices. All communications hereunder will be in writing and
effective only on receipt, and, if sent to you, will be mailed, delivered or
telegraphed and confirmed in the case of Solomon Brothers Inc at 7 World Trade
Center, New York, New York 10048, Attention: Legal Department; in the case of
Morgan Stanley & Co. Incorporated at 1585 Broadway, New York, New York 10036,
Attention: Legal Department; or, if sent to the Company, will be mailed,
delivered or telegraphed and confirmed to it at 225 West Washington Street,
Chicago, Illinois 60606, Attention: Secretary.
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 hereof, and no
other person will have any right or obligation hereunder.
12. Applicable Law. This Agreement will 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,
please sign and return to us the enclosed duplicate hereof, whereupon this
letter and your acceptance shall represent a binding agreement between the
Company and you.
Very truly yours,
UNION TANK CAR COMPANY
By:________________________________
Name: Kenneth P. Fischl
Title: Vice President
The foregoing Agreement is
hereby confirmed and accepted
as of the date first written
above:
SALOMON BROTHERS INC
MORGAN STANLEY & CO. INCORPORATED
By SALOMON BROTHERS INC
Acting on behalf of itself and
Morgan Stanley & Co. Incorporated
By:_______________________________
Name:
Title:
20
SCHEDULE I
Underwriting Agreement Dated: May 28, 1997
Registration Statement No.: 333-17121
Representative(s): Salomon Brothers Inc and Morgan Stanley & Co. Incorporated
Title, Purchase Price and Description of Securities:
Title: 7.45% Notes Due 2009
Principal amount: $150,000,000
Purchase price (include accrued interest or amortization, if any):
price to public: 100.000%
underwriting discount: 0.675%
proceeds to Company: 99.325%
Sinking fund provisions: None.
Redemption provisions: None.
Other provisions: None.
Closing Date, Time and Location: June 2, 1997, 9 AM (Chicago time), Law
Offices Neal, Gerber & Eisenberg, Two North LaSalle Street, Chicago, Illinois
Type of Offering: Delayed Offering
Delayed Delivery Arrangements: None.
21
Schedule II
Principal Amount
of Securities to
Underwriters be Purchased
---------------------- -----------------------
Salomon Brothers Inc $ 75,000,000
Morgan Stanley & Co. 75,000,000
Incorporated ----------
Total . . . . . . . . . . . . . . . . . . . . . $150,000,000
============