EXHIBIT 1.1
Companhia Vale do Rio Doce
Debt Securities
UNDERWRITING AGREEMENT
BASIC PROVISIONS
[Date]
To the Underwriters
named in the
Terms Agreement
supplemental hereto
Ladies and Gentlemen:
Companhia Vale do Rio Doce, a company organized under the laws of
Brazil (the "Company"), proposes, subject to the terms and conditions stated
herein, to issue and sell from time to time certain of its debt securities
specified in the Terms Agreement described below. Unless otherwise specified in
the Terms Agreement, such debt securities will be issued under an Indenture
dated as of (the "Indenture"), as amended or supplemented from time to time,
between the Company and , as trustee (the "Trustee"). Such debt securities
may have varying designations, denominations, currencies, interest rates and
payment dates, maturities, redemption provisions and selling prices.
Whenever the Company determines to make an offering of debt securities
through one or more investment banking firms, it will enter into a terms
agreement (the "Terms Agreement") with such firm or firms (such firms
constituting the "Underwriters") named therein providing for the sale of the
specific series of debt securities to be issued and sold by the Company pursuant
thereto (the "Securities"), and the purchase and offering thereof by such
Underwriters. The Terms Agreement shall be substantially in the form of Exhibit
A hereto and shall incorporate by reference the basic provisions set forth
herein.
Unless the context otherwise requires, as used hereinafter, (a) the
term "Agreement" shall refer to the Terms Agreement duly executed by the parties
thereto applicable to a specific offering incorporating the basic provisions set
forth herein; (b) the term "Underwriter" or "Underwriters" shall each refer to
the one or more investment banking firms which are parties to the Agreement; (c)
"you" or "your" or the "Representatives" shall refer to any manager or
co-managers of an underwriting syndicate so specified in the Agreement, or, if
none is or are so named, to the
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Underwriter or Underwriters; (d) "Registration Statement" shall mean the
registration statement referred to in the first sentence of Section 1(a),
including exhibits and financial statements, as amended or supplemented at the
Execution Time and, in the event any post-effective amendment thereto or any
Rule 462(b) Registration Statement becomes effective prior to the Closing Date,
shall also mean such registration statement as so amended or such Rule 462(b)
Registration Statement, as the case may be; (e) "Prospectus" shall mean the
prospectus supplement relating to the Securities that was first filed pursuant
to Rule 424(b) after the Execution Time (the "Prospectus Supplement"), together
with the prospectus contained in the Registration Statement at the Effective
Date including, any preliminary prospectus (the "Basic Prospectus"); (f)
"Execution Time" shall mean the date and time that the Agreement is executed and
delivered by the parties thereto; and (g) "Effective Date" shall mean each date
and time that the Registration Statement, any post-effective amendment or
amendments thereto and any Rule 462(b) Registration Statement became or become
effective. Any reference herein to the Registration Statement or the Prospectus
shall be deemed to refer to and include the documents incorporated by reference
therein which were filed with or furnished to the Commission under the
Securities Exchange Act of 1934, as amended, and the rules and regulations of
the Securities and Exchange Commission (the "Commission") thereunder (the
"Exchange Act") on or before the Effective Date of the Registration Statement or
the issue date of the Prospectus; and any reference herein to the terms "amend,"
"amendment" or "supplement" with respect to the Registration Statement or the
Prospectus shall be deemed to refer to and include the filing or furnishing of
any document under the Exchange Act after the Effective Date of the Registration
Statement or the issue date of the Prospectus that is incorporated therein by
reference.
SECTION 1. Representations and Warranties. The Company represents and
warrants to each Underwriter, as of the date hereof, as follows:
(a) A registration statement on Form F-3 (File No. 333-_____),
including a Basic Prospectus, relating to the Securities has
been prepared by the Company in conformity in all material
respects with the requirements of the Securities Act of 1933,
as amended, and the rules and regulations of the Commission
thereunder (the "Act"), the Trust Indenture Act of 1939, as
amended, and the rules and regulations of the Commission
thereunder (the "Trust Indenture Act"), and has been filed
with the Commission and has become effective. Such
registration statement may have been amended or supplemented
from time to time prior to the date of this Agreement; any
such amendment to the registration statement was so prepared
and filed and any such amendment has become effective. A
Prospectus Supplement relating to the Securities has been so
prepared and will be filed pursuant to Rule 424(b) under the
Act.
(b) On the Effective Date, the Registration Statement did or
will, and when the Prospectus is first filed (if required) in
accordance with Rule 424(b) and on the Closing Date (as
defined herein), the Prospectus (and any supplement thereto)
will, comply in all material respects with the
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applicable requirements of the Act and the Trust Indenture
Act; on the Effective Date and at the Execution Time, 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 applicable requirements of
the Trust Indenture Act; and, on the date of any filing
pursuant to Rule 424(b) and on the Closing Date, the
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 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 you expressly for inclusion in the Registration
Statement or the Prospectus (or any supplement thereto).
(c) The documents incorporated by reference in the
Registration Statement pursuant to Item 6 of Form F-3 under
the Act, at the time they were filed with the Commission,
complied in all material respects with the requirements of the
Exchange Act and, the Registration Statement, when it became
effective, or at the time of filing of the latest Annual
Report on Form 20-F, if later, complied in all material
respects with the requirements of the Act and did not contain
an untrue statement of a material fact or omit to state a
material fact necessary to make the statements therein, in
light of the circumstances under which they were made, not
misleading and any further documents deemed to be or, in the
case of a Report on Form 6-K, designated as being incorporated
by reference in the Registration Statement after the date of
this Agreement but prior to the termination of the offering of
Securities, will, when they are filed with or furnished to the
Commission, comply in all material respects with the
requirements of the Act, and when read together with the other
information included or incorporated in the Registration
Statement, will not contain an untrue statement of a material
fact or omit to state a material fact necessary to make the
statements therein, in light of the circumstances under which
they were made, not misleading, and the Company has not
distributed any offering material in connection with the
offering or sale of the Securities other than the Registration
Statement, the Basic Prospectus, the Prospectus or any other
materials, if any, permitted by the Act;
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(d) The Company has been duly organized and is validly
existing as a company in good standing under the laws of
Brazil, with corporate power and authority to own its
properties and conduct its business as described in the
Prospectus;
(e) The Indenture has been duly authorized, executed and
delivered, has been duly qualified under the Trust Indenture
Act, and constitutes a legal, valid and binding instrument
enforceable against the Company in accordance with its terms
(subject, as to enforcement of remedies, to applicable
bankruptcy, reorganization, insolvency, moratorium or other
laws affecting creditors' rights generally from time to time
in effect and to general principles of equity, including,
without limitation, concepts of materiality, reasonableness,
good faith and fair dealing, regardless of whether considered
in a proceeding in equity or at law (collectively referred to
as the "Enforceability Exceptions")); and the Securities have
been duly authorized and, when executed and authenticated in
accordance with the provisions of the Indenture and delivered
to and paid for by the Underwriters pursuant to this
Agreement, will constitute legal, valid and binding
obligations of the Company entitled to the benefits of the
Indenture, subject to the Enforceability Exceptions;
(f) The Indenture and the Securities conform in all material
respects to the descriptions thereof contained in the
Prospectus;
(g) Neither 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 or result in a breach or violation of (i) the
bylaws of the Company, (ii) the terms of any indenture,
contract, lease, mortgage, deed of trust, note agreement, loan
agreement or other agreement, obligation, condition, covenant
or instrument to which the Company is a party or bound or to
which its property is subject, or (iii) any existing statute,
law, rule, regulation, judgment, order or decree applicable to
the Company of any court, regulatory body, administrative
agency, governmental body, arbitrator or other authority
having jurisdiction over the Company or any of its properties,
except in the case of (ii) and (iii) as would not,
individually or in the aggregate, have a material adverse
effect on the performance of this Agreement or on the
condition (financial or otherwise), prospects, earnings,
business or properties of the Company and its subsidiaries,
taken as a whole.
(h) No consent, approval, authorization, filing with or order
of any court or governmental agency or body is required in
connection with the transactions contemplated in the Agreement
except for (i) such as have been obtained under the Act and
the Trust Indenture Act, such as may be required under the
blue sky laws of any jurisdiction in connection with the
purchase and distribution of the Securities by the
Underwriters in the
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manner contemplated herein and in the Prospectus and such as
may be set forth in the Terms Agreement and (ii) authorization
given by the Central Bank of Brazil.
(i) The consolidated historical financial statements and
schedules of the Company and its consolidated subsidiaries
included in the Prospectus and the Registration Statement
present fairly in all material respects the financial
condition, results of operations and cash flows of the Company
as of the dates and for the periods indicated, comply as to
form with the applicable accounting requirements of the Act
and have been prepared in conformity with generally accepted
accounting principles applied on a consistent basis throughout
the periods involved (except as otherwise noted therein);
(j) The Company and each of its subsidiaries maintain a system
of internal accounting sufficient to provide reasonable
assurance that (i) transactions are executed in accordance
with management's general or specific authorizations; (ii)
transactions are recorded as necessary to permit preparation
of financial statement in conformity with generally accepted
accounting principles and to maintain asset accountability;
(iii) access to assets is permitted only in accordance with
management's general or specific authorization; and (iv) the
recorded accountability for assets is compared with the
exiting assets at reasonable intervals and appropriate action
is taken with respect to any differences; and,
(k) This Agreement has been duly authorized, executed and
delivered by the Company.
Any certificate signed by any two officers of the Company and delivered
to you or counsel for the Underwriters in connection with the offering of
Securities shall be deemed a representation and warranty by the Company to each
Underwriter as to the matters covered thereby on the date of such certificate.
SECTION 2. Purchase and Sale. Subject to the terms and conditions and
in reliance upon the representations and warranties set forth in the Agreement,
the Company agrees to sell to each Underwriter, and each Underwriter agrees,
severally and not jointly, to purchase from the Company, at the purchase price
set forth in Terms Agreement the principal amount of the Securities set forth
opposite such Underwriter's name in the Terms Agreement.
Delivery of and payment for the Securities shall be made on the date
and at the time specified in the Terms Agreement or at such time on such later
date not more than three Business Days after the foregoing date as you shall
designate, which date and time may be postponed by agreement between the
Representatives and the Company or as provided in Section 9 hereof (such date
and time of delivery and payment for the Securities being herein called the
"Closing Date"). Delivery of the Securities shall be
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made to you for the respective accounts of the several Underwriters against
payment by the several Underwriters through you of the purchase price thereof to
or upon the order of the Company by wire transfer payable in same-day funds to
an account specified by the Company. Delivery of the Securities shall be made
through the facilities of The Depository Trust Company unless you shall
otherwise instruct.
SECTION 3. Covenants of the Company. The Company covenants with each
Underwriter as follows:
(a) Immediately following the execution of the Terms
Agreement, the Company will prepare a Prospectus Supplement
setting forth the principal amount of Securities covered
thereby and their terms not otherwise specified in the Basic
Prospectus, the names of the Underwriters participating in the
offering and the principal amount of Securities which each
severally has agreed to purchase, the names of the
Underwriters acting as co-managers in connection with the
offering, if any, the price at which the Securities are to be
purchased by the Underwriters from the Company, the initial
public offering price, the selling concession and reallowance,
if any, and such other information as you and the Company deem
appropriate in connection with the offering of the Securities.
The Company will promptly transmit copies of the Prospectus
Supplement to the Commission for filing pursuant to Rule
424(b) of the Regulations and will furnish to the Underwriters
as many copies of the Prospectus and such Prospectus
Supplement as you shall reasonably request.
(b) Prior to the termination of the offering of the
Securities, the Company will not file any amendment of the
Registration Statement or supplement to the Prospectus or any
Rule 462(b) Registration Statement 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. The Company will promptly advise you
(1) when the Prospectus, and any supplement thereto, shall
have been filed (if required) with the Commission pursuant to
Rule 424(b) or when any Rule 462(b) Registration Statement
shall have been filed with the Commission, (2) when, prior to
termination of the offering of the Securities, any amendment
to the Registration Statement shall have been filed or become
effective, (3) of any request by the Commission or its staff
for any amendment of the Registration Statement, or any Rule
462(b) Registration Statement, or for any supplement to the
Prospectus or for any additional information, (4) 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 (5) 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 institution or threatening of any
proceeding for such purpose. The Company will use its
commercially reasonable efforts to prevent the
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issuance of any such stop order or the suspension of any such
qualification and, if issued, to obtain as soon as possible
the withdrawal thereof.
(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
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 Prospectus to comply with the Act or the Exchange Act, the
Company promptly will (1) notify you of such event, (2)
prepare and file with the Commission an amendment or
supplement which will correct such statement or omission or
effect such compliance and (3) supply any supplemented
Prospectus to you in such quantities as you may reasonably
request.
(d) As soon as practicable, the Company will make generally
available to its security holders and to the Representatives
an earnings statement or statements of the Company and its
subsidiaries which will satisfy the provisions of Section
11(a) of the Act and Rule 158 under the Act.
(e) The Company will furnish to the Representatives and to
counsel for the Underwriters, without charge, signed or
conformed copies of the Registration Statement (including
exhibits thereto) and to each other Underwriter a copy of the
Registration Statement (without exhibits thereto) and, so long
as delivery of a prospectus by an Underwriter or dealer may be
required by the Act, as many copies of each preliminary
Prospectus and the Prospectus and any supplement thereto as
the Representatives may reasonably request.
(f) The Company will arrange, if necessary, for the
qualification of the Securities for sale under the laws of
such jurisdictions as you may designate, will maintain such
qualifications in effect so long as required for the
distribution of the Securities; provided that in no event
shall the Company be obligated to qualify to do business in
any jurisdiction where it is not now so qualified or to take
any action that would subject it to service of process in
suits, other than those arising out of the offering or sale of
the Securities, in any jurisdiction where it is not now so
subject.
(g) The Company will furnish, upon request of an Underwriter,
for a period of two years from the date of this Agreement
(unless otherwise publicly available on the Commission's EDGAR
website or the Company's website) (i) copies of any reports or
other communications which the Company shall send to its
shareholders or otherwise from time to time publish or
publicly disseminate, (ii) copies of all annual and other
reports filed with the Commission on Forms 20-F and 6-K, or
such other
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similar form as may be designated by the Commission, (iii)
copies of documents or reports filed with any securities
exchange on which any class of securities of the Company is
listed, and (iv) such other information as the Underwriters
may reasonably request regarding the Company and its
subsidiaries, in each case, as soon as such communications,
documents or information become available.
(h) The Company will apply the net proceeds from the sale of
the Securities in the manner set forth under the caption "Use
of Proceeds" in the Prospectus Supplement.
SECTION 4. Conditions of Underwriters' Obligation. The obligations of
the Underwriters to purchase Securities pursuant to the Terms Agreement are
subject to the accuracy of the representations and warranties on the part of the
Company herein contained, to the accuracy of the statements of the Company's
officers made in any certificate furnished pursuant to the provisions hereof, to
the performance by the Company of all of its covenants and other obligations
hereunder and to the following further conditions:
(a) The Company shall have requested and caused the General
Counsel of the Company to have furnished to you his opinion dated the
Closing Date and addressed to the Representatives, to the effect that:
(i) The Company (1) is a duly organized and validly existing
company under the laws of Brazil, (2) has the full corporate
power and authority necessary to own its property and assets
and to conduct its business as now being conducted, (3) is
duly qualified and authorized to do business in Brazil and (4)
has all power and authority necessary to own or hold its
respective properties and to conduct the businesses in which
it is engaged, except where the failure to be so qualified or
have such power or authority would not, individually or in the
aggregate, have a material adverse effect on the performance
of its obligations under the Securities or on the condition
(financial or otherwise), prospects, earnings, business or
properties of the Company and its subsidiaries, taken as a
whole.
(ii) the Company has full right, power and authority to
execute and deliver each of the Indenture, the Agreement and
the Securities and to perform its respective obligations
thereunder, and all corporate action required to be taken for
the due and proper authorization, execution and delivery of
the Indenture, the Agreement and the Securities and the
consummation of the transactions contemplated thereby has been
duly and validly taken;
(iii) Each of the Agreement and the Indenture has been duly
authorized, executed and delivered by the Company, and the
Securities have been duly authorized by the Company;
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(iv) The execution, delivery and performance by the Company of
each of the Agreement and the Indenture, the issuance and sale
of the Securities and compliance by the Company with the terms
thereof and the consummation of the transactions contemplated
by each of the Agreement and the Indenture will not conflict
with or result in a breach or violation of (i) the bylaws of
the Company, (ii) the terms of any indenture, contract, lease,
mortgage, deed of trust, note agreement, loan agreement or
other agreement, obligation, condition, covenant or instrument
to which the Company or any of its subsidiaries is a party or
bound or to which its or their property is subject, or (iii)
any existing statute, law, rule, regulation, judgment, order
or decree applicable to the Company of any court, regulatory
body, administrative agency, governmental body, arbitrator or
other authority in Brazil having jurisdiction over the Company
or any of its properties, except in the case of (ii) and (iii)
as would not, individually or in the aggregate, have a
material adverse effect on the performance of the Agreement or
the Indenture or on the condition (financial or otherwise),
prospects, earnings, business or properties of the Company and
its subsidiaries, taken as a whole, whether or not arising
from transactions in the ordinary course of business.
(v) To the best of such counsel's knowledge, except as
described in the Prospectus, there are no legal, governmental
or regulatory investigations, actions, suits or proceedings
pending in Brazil to which the Company or any of its
subsidiaries is a party which could reasonably be expected to
result in a material adverse change in the financial position,
stockholders' equity, results of operations, business
operations or properties of the Company and its subsidiaries
taken as a whole or on the performance by the Company of its
obligations under the Securities and the Agreement and the
Indenture; and to the best of his knowledge, no such
investigations, actions, suits or proceedings are threatened
or contemplated by any Brazilian governments or regulatory
authority or threatened by others in Brazil.
In rendering the above opinion, such counsel shall
additionally state that, based on his examination of the
Registration Statement, the Prospectus and each amendment
thereof or supplement thereto, although he is not passing upon
and does not assume any responsibility for the accuracy,
completeness or fairness of the statements contained in the
Registration Statement and the Prospectus and any amendment or
supplement thereto, on the basis of the foregoing, nothing has
come to his attention that would lead him to believe that on
the Effective Date the Registration Statement contained any
untrue statement of a material fact or omitted to state any
material fact required to be stated therein or necessary to
make the statements therein not misleading or that the
Prospectus as of its date and on the Closing Date included or
includes any untrue statement of a material fact or omitted or
omits to state a material fact necessary to make
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the statements therein, in the light of the circumstances
under which they were made, not misleading (except that no
such statement need be made by such counsel with respect to
the financial statements and other financial and statistical
data or information concerning mineral reserves included in
the Registration Statement, the Prospectus or in any amendment
or supplement thereto).
(b) The Company shall have requested and caused Cleary, Gottlieb,
Steen & Hamilton, special United States counsel to the Company, or such
other firm as may be reasonably acceptable to you, to the effect that:
(i) The Indenture has been duly executed and delivered by the Company
under the law of the State of New York and qualified under the Trust
Indenture Act, and is a valid, binding and enforceable agreement of
the Company.
(ii) The Securities have been duly executed and delivered by the
Company under the law of the State of New York and are the valid,
binding and enforceable obligations of the Company, entitled to the
benefits of the Indenture.
(iii) The statements set forth in the Prospectus under the heading
"Description of Debt Securities" and the description of the Securities
in the Prospectus, insofar as such statements purport to summarize
certain provisions of the Securities and the Indenture, provide a fair
summary of such provisions, and the statements (if any) set forth in
the Prospectus under the heading "Taxation-Certain United States Tax
Considerations," insofar as such statements purport to summarize
certain federal income tax laws of the United States, constitute a
fair summary of the principal U.S. federal income tax consequences of
an investment in the Securities.
(iv) The Agreement has been duly executed and delivered by the Company
under the law of the State of New York.
(v) The issuance and sale of the Securities to Underwriters pursuant
to this Agreement, and the performance by the Company of its
obligations in the Agreement, the Indenture and the Securities, do not
require any consent, approval, authorization, registration or
qualification of or with any governmental authority of the United
States or the State of New York, except such as have been obtained or
effected under the Act, the Exchange Act and the Trust Indenture Act
(but such counsel need not express any opinion as to any consent,
approval, authorization, registration or qualification that may be
required under state securities or Blue Sky laws).
(vi) The Company is not and, after giving effect to the offering and
sale of the Securities and the application of the proceeds thereof as
described in the Prospectus will not be an "investment company" within
the meaning of the Investment Company Act of 1940, as amended.
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(vii) Under the laws of the State of New York relating to submission to
jurisdiction, the Company, pursuant to Section 11 of this Agreement,
(i) has validly and irrevocably submitted to the personal jurisdiction
of any state or federal court located in the City, County and State of
New York in any action arising out of or related to the Purchase
Agreement, (ii) to the fullest extent permitted by law, has validly and
irrevocably waived any objection to the venue of a proceeding in any
such court, and (iii) has validly appointed Rio Doce America, Inc. as
its initial authorized agent for the purpose described in Section 11 of
this Agreement.
Such counsel shall additionally state in such opinion or in a separate letter
that, although it is not passing upon and does not assume any responsibility for
the accuracy, completeness or fairness of the statements contained in the
Registration Statement and the Prospectus (except to the extent provided in
subsection (iii) of this Section (b)), (A) nothing has come to the attention of
such counsel that would lead such counsel to believe that on the Effective Date
the Registration Statement contained any untrue statement of a material fact or
omitted to state any material fact required to be stated therein or necessary to
make the statements therein not misleading or that the Prospectus as of its date
and on the Closing Date included or includes any untrue statement of a material
fact or omitted or omits to state a material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading (except that no such statement need be made by such counsel
with respect to the financial statements and other financial and statistical
data or information concerning mineral reserves included in the Registration
Statement, the Prospectus or in any amendment or supplement thereto), (ii) no
information has come to such counsel's attention that causes it to believe that
the documents incorporated by reference in the Registration Statement and the
Prospectus (except the financial statements and schedules and other financial
and statistical data or information concerning mineral reserves included
therein, as to which such counsel need express no view), as of the Execution
Time, were not appropriately responsive in all material respects to the
requirements of the Exchange Act, (iii) such counsel does not know of any
contracts or other documents of a character required to be filed as exhibits to
the Registration Statement or required to be described in the Registration
Statement or the Prospectus that are not filed or described as required and (iv)
such counsel confirms that (based solely upon a telephonic confirmation from a
representative of the Commission) the Registration Statement is effective under
the Act and, to the best of such counsel's knowledge, no stop order with respect
thereto has been issued, and no proceeding for that purpose has been instituted
or threatened, by the Commission.
In rendering such opinion, such counsel may rely (A) as to matters involving the
application of laws of any jurisdiction other than the State of New York or the
Federal laws of the United States, to the extent they deem proper and specified
in such opinion, upon the opinion of other counsel of good standing whom they
believe to be reliable and who are satisfactory to counsel for the Underwriters
and (B) as to matters of fact, to the extent they deem proper, on certificates
of responsible officers of the Company and public officials.
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(3) The opinion, dated as of the Closing Date of Pinheiro Neto
Advogados, special Brazilian counsel to the Company, or such other firm or
attorney as may be reasonably acceptable to you, in form and substance
satisfactory to you, to the effect that:
(i) No consent, approval, authorization, notice, filing or
registration with any court or governmental agency or commission or
public body or authority in Brazil is required for (i) the execution,
delivery and performance by the Company of the Indenture, the Agreement
and the Securities, or (ii) the validity and enforceability of any of
the Indenture, the Agreement and the Securities, except as have been
obtained and are in full force and effect; provided, however, that the
remittance abroad by the Company of any payments in foreign currency
under the Indenture, the Agreement and the Securities, which are not
contemplated in a specific authorization issued by the Central Bank of
Brazil shall require a prior approval from the Central Bank of Brazil.
(ii) Subject to the translation of each of the Indenture, the
Agreement and the Securities into Portuguese, each of the Indenture,
the Agreement and the Securities is in proper legal form under the laws
of Brazil for the enforcement thereof in such jurisdiction.
(iii) The choice of New York law as the law in accordance with which
the Indenture, the Agreement and the Securities shall be governed is a
valid choice of law under the laws of Brazil and shall be recognized
and applied by the courts of Brazil, to the extent that such law does
not offend Brazilian national sovereignty, public order or good morals.
(iv) The submission of the Company to the non-exclusive jurisdiction
of any Federal or State Court in the City, County and State of New York
is a legal, valid and binding submission. Any judgment against the
Company issued by a court of the State of New York or a federal court
sitting in New York City of any sum payable by it under the Indenture,
the Agreement or Securities would be recognized and enforced in the
courts of Brazil without a substantive reexamination of the merits.
(v) Except as otherwise specified by such counsel in such opinion, no
stamp, registration, documentary transfer or similar taxes are payable
under the laws of Brazil by reason of any of the transactions
contemplated by the Indenture or the Agreement or in relation to the
execution, delivery or performance of, or any enforcement proceedings
in respect of the Indenture, the Agreement or Securities brought in the
courts of Brazil.
(vi) The statements contained under the headings "Taxation --
Brazilian Tax Considerations" in the Prospectus, which provide a
summary of the Brazilian tax considerations relating to an investment
in the Securities by a nonresident in Brazil and (ii) "Enforcement of
Civil Liabilities Against Non-U.S. Persons -- Brazil" in the
Prospectus, to the extent that they constitute summaries of existing
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Brazilian statutes, rules, regulations, legal, governmental and
regulatory proceedings and other matters of law fairly summarize the
matters described therein in all material respects.
(d) You shall have received from Clifford Chance, counsel for the
Underwriters, such opinion or opinions, dated the Closing Date and addressed to
you, with respect to the issuance and sale of the Securities, the Indenture, the
Registration Statement, the 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.
(e) The Company shall have requested and caused PricewaterhouseCoopers,
independent auditors for the Company, and such other independent auditors as may
be specified in the Terms Agreement, to have furnished to you, at the Execution
Time and at the Closing Date, letters, (which may refer to letters previously
delivered to one or more of you), 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 accountants within the meaning of the Act
and the Exchange Act and covering the matters that are ordinarily covered by
"comfort letters" drafted in accordance with Statement of Accounting Standards
No. 72.
(f) The Company shall have furnished to you a certificate, signed by
two executive officers of the Company with specific knowledge of the financial
matters of the Company, reasonably satisfactory to you, dated the Closing Date,
to the effect that the signers of such certificate have carefully examined the
Registration Statement, the Prospectus, and the Agreement and that:
(i) the representations and warranties of the Company in this
Agreement are true and correct 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 no proceedings for that purpose have been
instituted or, to the Company's knowledge, threatened; and
(iii) since the date of the most recent financial statements included
or incorporated by reference in the Prospectus (exclusive of any
supplement thereto), there has been no material adverse effect on the
condition (financial or otherwise), prospects, earnings, business or
properties of the Company and its subsidiaries, taken as a whole,
except as set forth in or contemplated in the Prospectus (exclusive of
any supplement thereto)
(g) 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)
13
and the Prospectus (exclusive of any supplement thereto), there shall not have
been any change, or any development involving a prospective change, in or
affecting the condition (financial or otherwise), earnings, business or
properties of the Company and its subsidiaries, taken as a whole, whether or not
arising from transactions in the ordinary course of business, except as set
forth in or contemplated in the Prospectus (exclusive of any supplement thereto)
the effect of which is, in your sole judgment, 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 Prospectus (exclusive of any supplement thereto).
(h) Subsequent to the Execution Time, there shall not have been any
decrease in the rating of any of the Company's debt securities by any
"nationally recognized statistical rating organization" (as defined for purposes
of Rule 436(g) under the Act) or any notice given of any intended or potential
decrease in any such rating or of a possible change in any such rating that does
not indicate the direction of the possible change.
(i) Prior to the Closing Date, the Company shall have furnished to the
Underwriters such further information, certificates and documents as the
Underwriters may reasonably request.
SECTION 5. Payment of Expenses. All expenses incident to the
performance of each party's obligations under this Agreement shall be paid in
the manner specified in the Terms Agreement.
SECTION 6. 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 existing
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 any preliminary prospectus or the 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 documented
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
expressly for inclusion therein; provided further, that with respect to any
untrue statement or omission
14
of material fact made in any preliminary prospectus, the indemnity agreement
contained in this Section 6(a) shall not inure to the benefit of any Underwriter
from whom the person asserting any such loss, claim, damage or liability
purchased the securities concerned, to the extent that any such loss, claim,
damage or liability of such Underwriter occurs under the circumstance where it
shall have been determined by a court of competent jurisdiction by final and
nonappealable judgment that (w) the Company had previously furnished copies of
the Prospectus to the Representatives, (x) delivery of the Prospectus was
required by the Act to be made to such person, (y) the untrue statement or
omission of a material fact contained in the preliminary prospectus was
corrected in the Prospectus and (z) 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. This indemnity agreement will be in addition
to any liability which the Company may otherwise have.
(b) Each Underwriter severally and not jointly 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
expressly 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. The Company acknowledges that the statements
identified in the Terms Agreement as "Information Furnished by the Underwriters"
constitute the only information furnished in writing by or on behalf of the
several Underwriters for inclusion in any preliminary prospectus or the
Prospectus.
(c) Promptly after receipt by an indemnified party under this Section 6
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 6, 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
15
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. It is understood, however,
that the indemnifying party shall, in connection with any one such action or
separate but substantially similar or related actions in the same jurisdiction
arising out of the same general allegations or circumstances, be liable for the
reasonable fees and expenses of only one separate firm of attorneys (in addition
to any local counsel) at any time for all such indemnified parties. The
indemnifying party shall not be liable for any settlement of any proceeding
effected without its written consent, but if settled with such consent or if
there be a final judgment for the plaintiff, the indemnifying party agrees to
indemnify each indemnified party from and against any loss or liability by
reason of such settlement or judgment. 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
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 6 is unavailable to or insufficient to hold harmless an indemnified
party for any reason, the Company and the Underwriters severally agree to
contribute to the aggregate losses, claims, damages and liabilities (including
legal or other documented 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 on the one
hand and by the Underwriters on the other 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 severally shall
contribute in such proportion as is appropriate to reflect not only such
relative benefits but also the relative fault of the Company on the one hand and
of the Underwriters on the other 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) received by
it, 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
16
the Prospectus. Relative fault shall be determined by reference to, among other
things, whether any untrue or any alleged untrue statement of a material fact or
the omission or alleged omission to state a material fact relates to information
provided by the Company on the one hand or the Underwriters on the other, the
intent of the parties and their relative knowledge, access to information and
opportunity to correct or prevent such untrue statement or omission. 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 6, 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).
SECTION 7. Representations, Warranties and Agreements to Survive
Delivery. All representations, warranties and agreements, including the
agreement of the Company in Section 6 hereof with respect to indemnity and
contribution, contained in this Agreement or contained in certificates issued by
the Company submitted pursuant hereto, shall remain operative and in full force
and effect, regardless of any termination of this Agreement, or any
investigation made by or on behalf of any Underwriter or controlling person, or
by or on behalf of the Company, and shall survive delivery of any Securities to
the Underwriters, provided, however, that no such representations, warranties or
agreements shall be deemed to have been given as to any point in time other than
the date hereof or as otherwise expressly provided herein. The provisions in
Sections 5 and 6 shall survive the termination or cancellation of this
Agreement.
SECTION 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 at any time prior to such time (i) trading in
the Company's American Depositary Receipts shall have been suspended by the
Commission or the New York Stock Exchange or 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) there shall have
occurred a material disruption in securities settlement, payment or clearance
services in the United States, (iii) a banking moratorium shall have been
declared either by Federal or New York State authorities or (iv) there shall
have occurred any outbreak or escalation of hostilities, declaration by the
United States of a national emergency or war, or other calamity or crisis the
effect of which on financial markets is such as to make it, in the sole judgment
of the Representatives, impractical or inadvisable to proceed with the offering
or delivery of the Securities as contemplated by the Prospectus (exclusive of
any supplement thereto).
17
SECTION 9. Default by an Underwriter. If one or more of the
Underwriters shall fail at the Closing Date to purchase the Securities which it
or they are obligated to purchase under the Agreement (the "Defaulted
Securities"), then you shall have the right, within 36 hours thereafter, to make
arrangements for one or more of the non-defaulting Underwriters, or any other
underwriters, to purchase all, but not less than all, of the Defaulted
Securities in such amounts as may be agreed upon and upon the terms herein set
forth. If, however, by the end of such 36 hours you shall not have completed
such arrangements for the purchase of all the Defaulted Securities then:
(a) if the aggregate amount of Defaulted Securities does not exceed 10%
of the aggregate amount of the Securities to be purchased pursuant to
the Terms Agreement, the non-defaulting Underwriters shall be obligated
to purchase the full amount thereof in the proportions that their
respective underwriting obligations hereunder bear to the underwriting
obligations of all such non-defaulting Underwriters, or
(b) if the aggregate amount of Defaulted Securities exceeds 10% of the
aggregate amount of the Securities to be purchased pursuant to the
Terms Agreement, this Agreement shall terminate, without any liability
on the part of any non-defaulting Underwriter or the Company.
In the event of a default by any Underwriter or Underwriters as set forth in
this Section, either you or the Company shall have the right to postpone the
Closing Date for a period not exceeding seven days in order that any required
changes in the Registration Statement or Prospectus or in any other documents or
arrangements may be effected. Any action taken under this Section shall not
relieve any defaulting Underwriter from liability in respect of any default of
such Underwriter under this Agreement
SECTION 10. Notices. All notices and other communications hereunder
shall be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the
Underwriters shall be directed to you at the address indicated in the Terms
Agreement; notices to the Company shall be directed to it at Diretoria
Financeira, Avenida Graca Aranha, No. 26, 20030-900 Rio de Janeiro, RJ, Brazil
(telefax: 5521-3814-4679), Attention: Finance Department.
SECTION 11. Governing Law; Submission to Jurisdiction. This Agreement
and each Terms Agreement shall be governed by and construed in accordance with
the laws of the State of New York applicable to agreements made and to be
performed in such State. The Company submits to the non-exclusive jurisdiction
of any Federal or State court in the City, County and State of New York, United
States of America, in any legal suit, action or proceeding based on or arising
under this Agreement and agrees that all claims in respect of such suit or
proceeding may be determined in any such court. The Company waives, to the
extent permitted by law, the defense of an inconvenient forum or objections to
personal jurisdiction with respect to the maintenance of such legal suit, action
or proceeding. The Company hereby designates and appoints Rio Doce America,
18
Inc. (the "Process Agent"), as its authorized agent, upon whom process may be
served in any such legal suit, action or proceeding, it being understood that
the designation and appointment of the Process Agent as such authorized agent
shall become effective immediately without any further action on the part of the
Company. Such appointment shall be irrevocable to the extent permitted by
applicable law and subject to the appointment of a successor agent in the United
States on terms substantially similar to those contained in this Section 11 and
reasonably satisfactory to you. If the Process Agent shall cease to act as agent
for services of process, the Company shall appoint, without unreasonable delay,
another such agent, and notify you of such appointment. The Company represents
to the Underwriters that it has notified the Process Agent of such designation
and appointment and that the Process Agent has accepted the same in writing. The
Company hereby authorizes and directs the Process Agent to accept such service.
The Company further agrees that service of process upon the Process Agent and
written notice of said service to such party shall be deemed in every respect
effective service of process upon the Company in any such legal suit, action or
proceeding. Nothing herein shall affect the right of any Underwriter or any
person controlling any Underwriter to serve process in any other manner
permitted by law.
SECTION 12. Parties. This Agreement shall inure to the benefit of and
be binding upon you and the Company, and their respective successors. Nothing
expressed or mentioned in this Agreement is intended or shall be construed as
given to any person, firm or corporation, other than the parties hereto and
their respective successors and the controlling persons and officers and
directors referred to in Section 6 and their heirs and legal representatives,
any legal or equitable right, remedy or claim under or in respect of this
Agreement or any provision herein contained. This Agreement and all conditions
and provisions hereof are intended to be for the sole and exclusive benefit of
the parties and their respective successors and said controlling persons and
officers and directors and their heirs and legal representatives, and for the
benefit of no other person, firm or corporation. No purchaser of Securities from
any Underwriter shall be deemed to be a successor by reason merely of such
purchase.
19
Exhibit A
COMPANHIA VALE DO RIO DOCE
TERMS AGREEMENT
Debt Securities
[Date]
To: The Underwriters identified herein
Ladies and Gentlemen:
Companhia Vale do Rio Doce (the "Company") agrees to sell to the
several Underwriters named in Schedule I hereto for their respective accounts,
on and subject to the terms and conditions of the Underwriting Agreement Basic
Provisions attached hereto as Exhibit I (the "Agreement"), the following
securities (the "Securities") on the following terms:
Title:
Principal Amount:
Interest:
Maturity:
Optional Redemption:
Listing:
Purchase Price: ____% of the principal amount, plus accrued interest, if
any, from ____________.
Closing: 9:30 a.m. on ____________, at the offices of Cleary, Gottlieb,
Steen & Hamilton, One Liberty Plaza, New York, New York, in Federal (same day)
funds.
Lead Underwriter:
Payment of Expenses:
Qualifications to Any Covenants or Representations Made by the Company:
20
Information Furnished by the Underwriters (for purposes of Section 6(b) of
the Underwriting Agreement Basic Provisions):
The respective principal amounts of the Securities to be purchased by each
of the Underwriters are set forth opposite their names in Schedule A hereto.
The provisions of the Underwriting Agreement Basic Provisions are
incorporated herein by reference.
If the foregoing is in accordance with your understanding of our agreement,
kindly sign and return to the Company one of the counterparts hereof, whereupon
it will become a binding agreement between the Company and the several
Underwriters in accordance with its terms.
Very truly yours,
COMPANHIA VALE DO RIO DOCE
By_________________________________
Name:
Title:
By_________________________________
Name:
Title:
The foregoing Terms Agreement is hereby
confirmed and accepted as of the date
first above written.
[ ]
acting on behalf of itself and as
representative of the
several Underwriters
By__________________________________
Name:
Title:
21
SCHEDULE I
Principal Amount of
Underwriter Securities
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22