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Exhibit 1.1
REX ENERGY
CORPORATION
UNDERWRITING
AGREEMENT
April 30,
2008
KeyBanc Capital Markets Inc.
As Representative of the several
Underwriters
KeyBank Center
800 Superior Avenue
Cleveland, Ohio 44114
Ladies and Gentlemen:
Rex Energy Corporation, a
Delaware corporation (the “ Company ”), together
with certain stockholders of the Company listed in
Schedule A hereto (the “ Selling
Stockholders ”), severally propose, subject to the terms
and conditions stated herein, to sell an aggregate of 8,500,000
shares (the “ Firm Securities ”) of common stock
of the Company, par value $0.001 per share (the “ Common
Stock ”), to the several underwriters named in
Schedule B hereto (the “ Underwriters
”), for whom KeyBanc Capital Markets, Inc. (“you”
or “ KBCM ”) is acting as representative. The
Firm Securities consist of 4,500,000 authorized but
unissued shares of Common Stock to be issued and sold by the
Company and 4,000,000 outstanding shares of Common
Stock to be sold by the Selling Stockholders.
In addition, the Company also
proposes to grant the Underwriters an option to purchase up to an
aggregate of 1,275,000 additional shares of Common
Stock (the “ Optional Securities ”). The Firm
Securities and the Optional Securities are hereinafter collectively
referred to as the “ Securities .” The Company
and the Selling Stockholders hereby confirm the agreement with you,
acting as representative of the Underwriters, concerning the
purchase of the Securities from the Company and the Selling
Stockholders by the Underwriters.
It is understood and agreed
by all parties that on July 30, 2007, in connection with the
Company’s initial public offering:
(a) Each of Douglas
Oil & Gas Limited Partnership, a Delaware limited
partnership (“ Douglas Oil & Gas ”),
Douglas Westmoreland Limited Partnership, a Delaware limited
partnership (“ Douglas Westmoreland ”), Midland
Exploration Limited Partnership, a Delaware limited partnership
(“ Midland Exploration ”), New Albany-Indiana,
LLC, a Delaware limited liability company (“ New
Albany ”), Rex Energy Limited Partnership, a Delaware
limited partnership (“ Rex I ”), Rex Energy II
Limited Partnership, a Delaware limited partnership (“
Rex II ”), Rex Energy III LLC, a Delaware limited
liability company (“ Rex III ”), Rex
Energy II Alpha Limited Partnership, a Delaware limited
partnership (“ Rex II Alpha ”), and Rex
Energy Royalties Limited Partnership, a Delaware limited
partnership (“ Rex Royalties ”), were merged
with and into Rex Energy I, LLC, a Delaware limited liability
company (“ Rex Energy I, LLC ”), with Rex
Energy I, LLC being the surviving entity of such mergers (the
“ Mergers ”); and
(b) Holders of equity
interests in PennTex Resources Illinois, Inc., a Delaware
corporation (“ PennTex Illinois ”), PennTex
Resources, L.P., a Texas limited partnership (“ PennTex
Resources ”), Penn Tex Energy, Inc., a Delaware
corporation (“ PennTex Energy ”), Rex
Energy IV, LLC, a Delaware limited liability company (“
Rex IV ”) and Rex Energy Operating Corp., a
Delaware corporation (“ Rex Operating ”),
contributed their equity interests (a “ Founding Company
Equity Interest ”) in such entities for shares of Common
Stock (the “ Contributions ” and, collectively
with the Mergers, the “ Reorganization Transactions
”).
Douglas Oil & Gas,
Douglas Westmoreland, Midland Exploration, New Albany, Rex I,
Rex II, Rex III, Rex II Alpha, Rex Royalties,
PennTex Illinois, PennTex Resources, PennTex Energy, Rex IV
and Rex Operating are collectively referred to herein as the
“ Founding Companies ” and Rex Energy I,
LLC, PennTex Illinois, PennTex Resources, PennTex Energy,
Rex IV, R.E. Gas Development, LLC, a Delaware limited
liability company, Rex Energy Marketing, LLC, a Delaware limited
liability company, and Rex Operating are collectively referred to
herein as the “ Subsidiaries .”
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Representations and Warranties of the Company . The
Company represents and warrants to, and agrees with, each of the
Underwriters that: |
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(a) |
A registration statement on Form S-1 relating to the Securities
has (i) been prepared by the Company in conformity with the
requirements of the Securities Act of 1933, as amended (the “
Securities Act ”), and the rules and regulations (the
“ Securities Act Regulations ”) of the
Securities and Exchange Commission (the “ Commission
”) thereunder; (ii) been filed with the Commission under
the Securities Act; and (iii) become effective under the
Securities Act. Copies of such registration statement and any
amendment thereto have been delivered by the Company to you as
representative of the Underwriters. As used in this
Agreement: |
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(i) |
“ Applicable Time ” means 7:00 a.m. (Eastern
time) on April 30, 2008; |
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(ii) |
“ Effective Date ” means the date and time
as of which such registration statement, or the most recent
post-effective amendment thereto, was declared effective by the
Commission; |
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(iii) |
“ Issuer Free Writing Prospectus ” means
each “free writing prospectus” (as defined in
Rule 405 of the Securities Act Regulations) prepared by or on
behalf of the Company or used or referred to by the Company in
connection with the offering of the Securities; |
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(iv) |
“ Material Adverse Effect ” means a material
adverse effect on the condition (financial or otherwise), business,
properties, prospects, results of operations or stockholders’
equity, in each case other than as a result of an event,
circumstance or condition applicable to the oil and gas industry as
a whole, of the Company and the Subsidiaries, taken as a
whole; |
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(v) |
“ Preliminary Prospectus ” means any
preliminary prospectus relating to the Securities included in such
registration statement or filed with the Commission pursuant to
Rule 424(b) of the Securities Act Regulations; |
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(vi) |
“ Pricing Disclosure Package ” means, as of
the Applicable Time, the most recent Preliminary Prospectus,
together with the information included in Schedule C
hereto, and each Issuer Free Writing Prospectus filed or used by
the Company on or before the Applicable Time, other than a road
show that is an Issuer Free Writing Prospectus but is not required
to be filed under Rule 433 of the Securities Act
Regulations; |
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(vii) |
“ Prospectus ” means the final prospectus
relating to the Securities filed with the Commission pursuant to
Rule 424(b) of the Securities Act Regulations; |
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(viii) |
“ Registration Statement ” means the
registration statement relating to the Securities on Form S-1
(File No. 333-150120), as amended as of the Effective Date,
including any Preliminary Prospectus or the Prospectus and all
exhibits to such registration statement; and |
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(ix) |
“ Selling Stockholder Material Adverse Effect
” means a material adverse effect on the ability of a Selling
Stockholder to consummate the offering of the Securities to be sold
by such Selling Stockholder or any transaction contemplated by this
Agreement or the Irrevocable Power of Attorney. |
Any reference to any
Preliminary Prospectus or the Prospectus shall be deemed to refer
to and include any documents incorporated by reference therein
pursuant to General Instruction VII of Form S-1 under the
Securities Act as of the date of such Preliminary Prospectus or the
Prospectus, as the case may be. Any reference herein to the term
“Registration Statement” shall be deemed to include an
abbreviated registration statement to register additional shares of
Common Stock under Rule 462(b) of the Securities Act
Regulations, if any (the “ Rule 462(b) Registration
Statement ”).
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(b) |
The Company was not at the time of initial filing of the
Registration Statement and at the earliest time thereafter that the
Company or another offering participant made a bona fide
offer (within the meaning of Rule 164(h)(2) of the Securities
Act Regulations) of the Securities, is not on the date hereof and
will not be on the applicable Delivery Date (as defined in
Section 3 ) an “ineligible issuer” (as
defined in Rule 405). The Company is eligible to incorporate
information by reference pursuant to the General Instruction VII to
Form S-1. |
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(c) |
The Commission has not issued any order preventing or
suspending the use of any Preliminary Prospectus or the Prospectus
or suspending the effectiveness of the Registration Statement, and
no proceeding or examination for such purpose has been instituted
or threatened by the Commission. |
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(d) |
The Registration Statement conformed and will conform in all
material respects on the Effective Date and on the applicable
Delivery Date, and any amendment to the Registration Statement
filed after the date hereof will conform in all material respects
when filed, to the requirements of the Securities Act and the
Securities Act Regulations. Each Preliminary Prospectus conformed,
and the Prospectus will conform, in all material respects when
filed with the Commission pursuant to Rule 424(b) of the
Securities Act Regulations and on the applicable Delivery Date to
the requirements of the Securities Act and the Securities Act
Regulations. The documents incorporated by reference in any
Preliminary Prospectus or the Prospectus conformed, when filed with
the Commission, in all material respects to the requirements of the
Exchange Act of 1934, as amended (the “ Exchange Act
”) or the Securities Act, as applicable, and the rules and
regulations of the Commission thereunder. |
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(e) |
The Registration Statement did not, as of the Effective Date,
contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make
the statements therein not misleading; provided , that no
representation or warranty is made as to information contained in
or omitted from the Registration Statement in reliance upon and in
conformity with written information furnished to the Company
through KBCM by or on behalf of any Underwriter specifically for
inclusion therein, which information is specified in
Section 8(f). |
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(f) |
The Prospectus will not, as of its date and on the applicable
Delivery Date, contain an untrue statement of a material fact or
omit to state a material fact required to be stated therein or
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading;
provided , that no representation or warranty is made as to
information contained in or omitted from the Prospectus in reliance
upon and in conformity with written information furnished to the
Company through KBCM by or on behalf of any Underwriter
specifically for inclusion therein, which information is specified
in Section 8(f). |
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(g) |
The documents incorporated by reference in any Preliminary
Prospectus or the Prospectus did not, when filed with the
Commission, contain an untrue statement of a material fact or omit
to state a material fact required to be stated therein or necessary
to make the statements therein, in the light of the circumstances
under which they were made, not misleading. |
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(h) |
The Pricing Disclosure Package did not, as of the Applicable
Time, contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to
make the statements therein, in the light of the circumstances
under which they were made, not misleading; provided , that
no representation or warranty is made as to information contained
in or omitted from the Pricing Disclosure Package in reliance upon
and in conformity with written information furnished to the Company
through KBCM by or on behalf of any Underwriter specifically for
inclusion therein, which information is specified in
Section 8(f). |
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(i) |
Each Issuer Free Writing Prospectus (including, without
limitation, any road show that is a free writing prospectus under
Rule 433), when considered together with the Pricing Disclosure
Package as of the Applicable Time, did not contain an untrue
statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were
made, not misleading. |
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(j) |
Each Issuer Free Writing Prospectus conformed or will conform
in all material respects to the requirements of the Securities Act
and the Securities Act Regulations on the date of first use, and
the Company has complied with all prospectus delivery and any
filing requirements applicable to such Issuer Free Writing
Prospectus pursuant to the Securities Act Regulations. The Company
has not made any offer relating to the Securities that would
constitute an Issuer Free Writing Prospectus without the prior
written consent of KBCM. The Company has retained in accordance
with the Securities Act Regulations all Issuer Free Writing
Prospectuses that were not required to be filed pursuant to the
Securities Act Regulations. The Company has taken all actions
necessary so that any “road show” (as defined in Rule
433 of the Securities Act Regulations) in connection with the
offering of the Securities will not be required to be filed
pursuant to the Securities Act Regulations. |
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(k) |
The Company has been duly incorporated and is validly existing
and in good standing as a corporation under the laws of the State
of Delaware, with the requisite power and authority to own and
lease its properties and conduct its business as described in each
of the Preliminary Prospectus and the Prospectus. The Company is
duly qualified to do business and in good standing as a foreign
corporation in all jurisdictions in which its ownership or lease of
property or the conduct of its business requires such
qualification, except where the failure to be so qualified or in
good standing could not, individually or in the aggregate,
reasonably be expected to have a Material Adverse
Effect. |
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(l) |
As of each Delivery Date, the Company will not own or control,
directly or indirectly, any corporation, association or other
entity other than the Subsidiaries. All of the outstanding capital
stock or other equity interests, as applicable, of each Subsidiary
have been duly authorized and validly issued, are fully paid and
nonassessable and, as of each Delivery Date, will be owned by the
Company, directly or indirectly through subsidiaries, free and
clear of all liens, encumbrances, equities or claims. |
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(m) |
Each
Subsidiary has been duly organized, is validly existing and in good
standing as a corporation, limited liability company or limited
partnership, as applicable, under the laws of the jurisdiction of
its organization, as applicable, with the requisite power and
authority (corporate, limited liability company or limited
partnership, as applicable) to own and lease its properties and
conduct its business
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as described in each of
the most recent Preliminary Prospectus and the Prospectus. Each
Subsidiary is duly qualified to do business as a foreign
corporation, limited liability company or limited partnership, as
applicable, in good standing in all jurisdictions in which its
ownership or lease of property or the conduct of its business
requires such qualification, except where the failure to be so
qualified could not, individually or in the aggregate, reasonably
be expected to have a Material Adverse Effect.
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(n) |
The Company has all requisite corporate power and authority to
execute, deliver and perform its obligations under this Agreement.
This Agreement has been duly and validly authorized, executed and
delivered by the Company. |
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(o) |
The duly authorized, issued and outstanding capitalization of
the Company is as set forth under the caption
“Capitalization” in each of the most recent Preliminary
Prospectus and the Prospectus as of the date set forth therein; all
of the issued and outstanding shares of capital stock of the
Company (including the Securities to be sold by the Selling
Stockholders to the Underwriters hereunder), on the date hereof are
duly authorized and validly issued, fully paid and nonassessable,
are free of any preemptive rights, rights of first refusal or
similar rights, were issued and sold in compliance with applicable
federal and state securities laws and conform in all material
respects to the description thereof in the most recent Preliminary
Prospectus and the Prospectus; except as described in the most
recent Preliminary Prospectus and the Prospectus, there are no
outstanding options, warrants or other rights calling for the
issuance of, and there are no commitments, plans or arrangements to
issue any shares of capital stock of the Company or any security
convertible or exchangeable or exercisable for capital stock of the
Company. |
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(p) |
The Securities to be issued and sold by the Company to the
Underwriters hereunder have been duly authorized, will be validly
issued, fully paid and non-assessable, will conform to the
description thereof contained in the most recent Preliminary
Prospectus and the Prospectus, will be issued in compliance with
federal and state securities laws and will be free of statutory and
contractual preemptive rights, rights of first refusal and similar
rights. |
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(q) |
The
execution, delivery and performance of this Agreement by the
Company, the consummation of the transactions contemplated hereby,
the application of the proceeds from the sale of the Securities as
described under “Use of Proceeds” in the most recent
Preliminary Prospectus and the Prospectus will not
(i) conflict with or result in a breach or violation of any of
the terms or provisions of, impose any lien, charge or encumbrance
upon any property or assets of the Company and its Subsidiaries, or
constitute a default under, any indenture, mortgage, deed of trust,
loan agreement, license or other agreement or instrument to which
the Company or any of its Subsidiaries is a party or by which the
Company or any of its Subsidiaries is bound or to which any of the
property or assets of the Company or any of its Subsidiaries is
subject; (ii) result in any violation of the provisions of the
charter or by-laws (or similar organizational documents) of the
Company or
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any of its Subsidiaries;
or (iii) result in any violation of any statute or any order,
rule or regulation of any court or governmental agency or body
having jurisdiction over the Company or any of its Subsidiaries or
any of their respective properties or assets, except with respect
to clauses (i) and (iii), for such conflicts, breaches,
violations or defaults that would not, individually or in the
aggregate, have a Material Adverse Effect.
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(r) |
Other than as identified and described in the Registration
Statement and the most recent Preliminary Prospectus and the
Prospectus, there are no contracts, agreements or understandings
between the Company and any person granting such person the right
(other than rights which have been waived in writing or otherwise
satisfied) to require the Company to file a registration statement
under the Securities Act with respect to any shares of Common Stock
or any other securities of the Company owned or to be owned by such
person or to require the Company to include such Common Stock or
other securities in the Registration Statement. |
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(s) |
No consent, approval, authorization, or order of, or filing or
registration with, any governmental agency or body or any court is
required for the execution, delivery and performance of this
Agreement by the Company and the application of the proceeds from
the sale of the Securities as described under “Use of
Proceeds” in each of the most recent Preliminary Prospectus
and the Prospectus, except such as (i) has been obtained or
made under the Securities Act or the Exchange Act or as may be
required by state securities or “blue sky” laws or
(ii) may be required by the bylaws and rules of the Financial
Industry Regulatory Authority (“ FINRA
”). |
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(t) |
None of the Company or any of the Subsidiaries (i) is in
violation of its certificate of incorporation, by-laws, certificate
of limited partnership, limited partnership agreement, certificate
of formation, limited liability company agreement or similar
organizational documents, as applicable, (ii) is in default
(or, with the giving of notice or lapse of time or both, would be
in default) under any indenture, mortgage, deed of trust, lease,
loan agreement or other agreement or instrument to which the
Company or any of the Subsidiaries is a party or by which the
Company or any of the Subsidiaries is bound or to which any of the
property or assets of the Company or any of the Subsidiaries is
subject, or (iii) is in violation of any statute or any order,
rule or regulation of any court or governmental agency or body
having jurisdiction over it or its property or assets or has failed
to obtain any license, permit, certificate, franchise or other
governmental authorization or permit necessary to the ownership of
its property or to the conduct of its business, except in the cases
of clauses (ii) and (iii), to the extent any such
conflict, breach, violation or default could not, individually or
in the aggregate, have a Material Adverse Effect. |
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(u) |
The Company
and the Subsidiaries have good and marketable title in fee simple
to all real property owned by them, and good and marketable title
to all other property owned by them, in each case free from
mortgages, pledges, liens, security interests, claims,
restrictions, encumbrances and defects of any kind
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(each a “
Lien ”), except Liens that (i) are described in
each of the most recent Preliminary Prospectus and the Prospectus,
including Liens under our senior credit facility dated as of
September 28, 2007 (the “ Senior Credit Facility
”), or (ii) such would not, individually or in the
aggregate, have a Material Adverse Effect. All of the leases and
subleases material to the business of the Company and the
Subsidiaries, and under which the Company or any of its
Subsidiaries holds the properties described in each of the most
recent Preliminary Prospectus and the Prospectus, are in full force
and effect, and none of the Company or any Subsidiary has any
notice of any material claim of any sort that has been asserted by
anyone adverse to the rights of the Company or any of its
Subsidiaries under any such leases or subleases, or affecting or
questioning the rights of the Company or such Subsidiary to the
continued possession of the leased or subleased property under any
such lease or sublease.
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(v) |
The Company and the Subsidiaries possess such certificates,
permits, licenses, approvals, consents and other authorizations
(collectively, “ Governmental Licenses ”) issued
by appropriate federal, state or local governmental or regulatory
agencies or bodies necessary to conduct the businesses in the
manner described in each of the most recent Preliminary Prospectus
and the Prospectus; and the Company and the Subsidiaries are in
compliance with the terms and conditions of all such Governmental
Licenses, except where the failure to so possess or comply would
not, individually or in the aggregate, have a Material Adverse
Effect; all of the Governmental Licenses are valid in full force
and effect, except where the invalidity of such Governmental
Licenses or the failure of such Governmental Licenses to be in full
force and effect would not have a Material Adverse Effect; and
neither the Company nor any of the Subsidiaries have received any
notice of proceedings relating to the revocation or modification of
any such Governmental Licenses that, if determined adversely to the
Company or any of the Subsidiaries, would, individually or in the
aggregate, have a Material Adverse Effect. |
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(w) |
Except as described in each of the most recent Preliminary
Prospectus and the Prospectus, there are no legal or governmental
actions, suits, arbitrations or other proceedings pending as to
which the Company or any of the Subsidiaries is a party or of which
any property of the Company or any of the Subsidiaries is the
subject that, if determined adversely to the Company or any of the
Subsidiaries, could reasonably be expected to individually or in
the aggregate, have a Material Adverse Effect or could reasonably
be expected to adversely affect the ability of the Company to
perform its obligations under this Agreement; and no such actions,
suits or proceedings are, to the Company’s knowledge,
threatened. No labor dispute with the employees of the Company or
any of the Subsidiaries exists or, to the knowledge of the Company,
is threatened or imminent that could reasonably be expected to
have, individually or in the aggregate, a Material Adverse
Effect. |
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(x) |
There are no
legal or governmental proceedings or contracts or other documents
of a character required to be described in the Registration
Statement, the most recent Preliminary Prospectus or, in the case
of documents, to be filed as exhibits
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to the Registration
Statement that are not described and filed as required. None of the
Company or any of its Subsidiaries has knowledge that any other
party to any such contract, agreement or arrangement has any
intention not to render full performance as contemplated by the
terms thereof; and that statements made in each of the most recent
Preliminary Prospectus and the Prospectus under the captions
“Management’s Discussion and Analysis of Financial
Condition and Results of Operations,” and
“Business” insofar as they purport to constitute
summaries of the terms of statutes, rules or regulations, legal or
governmental proceedings or contracts and other documents,
constitute accurate summaries of the terms of such statutes, rules
and regulations, legal and governmental proceedings and contracts
and other documents in all material respects.
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(y) |
The Company and the Subsidiaries own, possess or can acquire on
reasonable terms, adequate trademarks, trade names and other rights
to inventions, know-how, patents, copyrights, confidential
information and other intellectual property (collectively, “
intellectual property rights ”) necessary to conduct
the business now operated by them, or presently employed by them,
and have not received any notice of infringement of or conflict
with asserted rights of others with respect to any intellectual
property rights that, if determined adversely to the Company or any
of the Subsidiaries, could reasonably be expected to, individually
or in the aggregate, have a Material Adverse Effect. |
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(z) |
Except as
would not, individually or in the aggregate, have a Material
Adverse Effect, or as described in each of the most recent
Preliminary Prospectus and the Prospectus, (i) none of the
Company or any of the Subsidiaries is in violation of any federal,
state or local statute, rule, regulation, ordinance, code, policy
or rule of common law or any judicial or administrative
interpretation thereof, including any judicial or administrative
order, consent, decree or judgment, of any governmental agency or
body or any court relating to the pollution or protection of human
health, the environment (including, without limitation, ambient
air, surface water, groundwater, land surface, or subsurface
strata) or wildlife, including, without limitation, laws and
regulations relating to the release or threatened release of
chemicals, pollutants, contaminants, wastes, toxic substances,
hazardous substances, petroleum or petroleum products
(collectively, “ Hazardous Materials ”) or to
the manufacture, processing, distribution, use, treatment, storage,
disposal, transport or handling of Hazardous Materials
(collectively, “ Environmental Laws ”) and
(ii) the Company and its Subsidiaries have all permits,
authorizations and approvals required under any applicable
Environmental Laws and are each in compliance with their
requirements. Except as disclosed in each of the most recent
Preliminary Prospectus and the Prospectus, there are no pending or,
to the knowledge of the Company, threatened administrative,
regulatory or judicial actions, suits, demands, demand letters,
claims, liens, notices of noncompliance or violation, investigation
or proceedings relating to any Environmental Law that, if
determined adversely to the Company or any of its Subsidiaries,
could reasonably be expected to, individually or in the aggregate,
have a Material Adverse Effect. To the knowledge of the Company,
and except as described in each of the most recent Preliminary
Prospectus and the
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Prospectus, there are no
events or circumstances that might reasonably be expected to form
the basis of an order for clean-up or remediation, or an action,
suit or proceeding by any private party or governmental body or
agency, against or affecting the Company or any of its Subsidiaries
relating to any Hazardous Materials or the violation of any
Environmental Laws that would, individually or in the aggregate,
have a Material Adverse Effect.
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(aa) |
In each case except as would, individually or in the aggregate,
have a Material Adverse Effect (i) each “employee
benefit plan” (within the meaning of Section 3(3) of the
Employee Retirement Security Act of 1974, as amended (“
ERISA ”)) for which the Company or any member of the
Company’s “ Controlled Group ” (defined as
any organization which is a member of a controlled group of
corporations within the meaning of Section 414 of the Internal
Revenue Code of 1986, as amended (the “ Code ”))
would have any liability (each a “ Plan ”) has
been maintained in compliance with its terms and with the
requirements of all applicable statutes, rules and regulations
including ERISA and the Code; (ii) with respect to each Plan
subject to Title IV of ERISA (a) no “reportable
event” (within the meaning of Section 4043(c) of ERISA)
has occurred or is reasonably expected to occur, (b) no
“accumulated funding deficiency” (within the meaning of
Section 302 of ERISA or Section 412 of the Code), whether
or not waived, has occurred or is reasonably expected to occur,
(c) the fair market value of the assets under each Plan
exceeds the present value of all benefits accrued under such Plan
(determined based on those assumptions used to fund such Plan) and
(d) none of the Company or any member of the Company’s
Controlled Group has incurred, or reasonably expects to incur, any
liability under Title IV of ERISA (other than contributions to
the Plan or premiums to the PBGC in the ordinary course and without
default) in respect of a Plan (including a “multiemployer
plan,” within the meaning of Section 4001(c)(3) of
ERISA); and (iii) each Plan that is intended to be qualified
under Section 401(a) of the Code is so qualified and nothing
has occurred, whether by action or by failure to act, which would
cause the loss of such qualification. |
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(bb) |
The Company and the Subsidiaries have (i) filed on a
timely basis all necessary federal, state, local and foreign income
and franchise tax returns required to be filed or have duly
requested extensions thereof; and (ii) paid all taxes shown as
due on such tax returns (including any related assessments, fines
or penalties), except for taxes being contested in good faith for
which reserves in accordance with the generally accepted accounting
principles have been provided. No tax deficiency has been asserted
against the Company or any of the Subsidiaries which has had, nor
does the Company know of any tax deficiency that is likely to be
asserted against the Company or any of the Subsidiaries which, if
determined adversely to the Company or any of the Subsidiaries,
could have, a Material Adverse Effect. |
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(cc) |
There are no transfer taxes or other similar fees or charges
under Federal law or the laws of any state, or any political
subdivision thereof, required to be paid in connection with the
execution and delivery of this Agreement or the issuance by the
Company or sale by the Company of the Securities. |
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(dd) |
The Company and each of the Subsidiaries carry, or are covered
by, insurance from insurers of recognized financial responsibility
in such amounts and covering such risks as is adequate for the
conduct of their respective businesses and the value of their
respective properties and as is customary for companies engaged in
similar businesses in similar industries. All policies of insurance
of the Company and the Subsidiaries are in full force and effect;
the Company and the Subsidiaries are in compliance with the terms
of such policies in all material respects; and none of the Company
and the Subsidiaries has received notice from any insurer or agent
of such insurer that capital improvements or other expenditures are
required or necessary to be made in order to continue such
insurance; there are no claims by the Company and the Subsidiaries
under any such policy or instrument as to which any insurance
company is denying liability or defending under a reservation of
rights clause; and none of the Company and the Subsidiaries has any
reason to believe that it will not be able to renew its existing
insurance coverage as and when such coverage expires or to obtain
similar coverage from similar insurers as may be necessary to
continue its business at a cost that could not reasonably be
expected to have a Material Adverse Effect. |
| |
(ee) |
The Company and each of the Subsidiaries are in compliance in
all respects with all applicable provisions of the Occupational
Safety and Health Act of 1970, as amended, including all applicable
regulations thereunder, except for such noncompliance as would not,
individually or in the aggregate, have a Material Adverse
Effect. |
| |
(ff) |
None of the Company or any Subsidiary is in violation of or has
received notice of any violation with respect to any federal or
state law relating to discrimination in the hiring, promotion or
pay of employees, nor any applicable federal or state wage and hour
laws, nor any state law precluding the denial of credit due to the
neighborhood in which a property is situated, the violation of any
of which could reasonably be expected to have a Material Adverse
Affect. |
| |
(gg) |
None of the Company or any of the Subsidiaries, nor, to the
knowledge of the Company, any director, officer, agent, employee or
other person associated with or acting on behalf of the Company or
any of the Subsidiaries, has (i) used any corporate funds for
any unlawful contribution, gift, entertainment or other unlawful
expense relating to political activity; (ii) made any direct
or indirect unlawful payment to any foreign or domestic government
official or employee from corporate funds; (iii) violated or
is in violation of any provision of the U.S. Foreign Corrupt
Practices Act of 1977 or (iv) made any bribe, rebate, payoff,
influence payment, kickback or other unlawful payment. |
| |
(hh) |
The
operations of the Company and any of the Subsidiaries, are and have
been conducted at all times in compliance with applicable financial
recordkeeping and reporting requirements of the Currency and
Foreign Transactions Reporting Act
|
11
| |
of 1970, as amended, the
money laundering statutes of all jurisdictions, the rules and
regulations thereunder and any related or similar rules,
regulations or guidelines, issued, administered or enforced by any
governmental agency (collectively, the “ Money Laundering
Laws ”) and no action, suit or proceeding by or before
any court or governmental agency, authority or body or any
arbitrator involving the Company or any of the Subsidiaries with
respect to the Money Laundering Laws is pending or, to the
knowledge of the Company, threatened, except, in each case, as
would not reasonably be expected to have a Material Adverse
Effect.
|
| |
(ii) |
None of the Company or any of the Subsidiaries, nor, to the
knowledge of the Company, any director, officer, agent, employee or
affiliate of the Company and any of the Subsidiaries is currently
subject to any U.S. sanctions administered by the Office of
Foreign Assets Control of the U.S. Treasury Department
(“ OFAC ”); and the Company will not directly or
indirectly use the proceeds of the offering, or lend, contribute or
otherwise make available such proceeds to any subsidiary, joint
venture partner or other person or entity, for the purpose of
financing the activities of any person currently subject to any
U.S. sanctions administered by OFAC. |
| |
(jj) |
Except as described in each of the most recent Preliminary
Prospectus and the Prospectus, and except as pursuant to the Senior
Credit Facility, upon consummation of this offering, including the
application of the use of proceeds of the offering, none of the
Subsidiaries will be restricted, directly or indirectly, from
(i) paying any dividends or distributions to the Company,
(ii) repaying to the Company any loans or advances to such
Subsidiary from the Company or (iii) transferring any property
or assets to the Company or any other Subsidiary of the
Company. |
| |
(kk) |
The
historical combined and consolidated financial statements of the
Company, the balance sheet of the Company, the historical combined
financial statements of the Founding Companies and the historical
combined balance sheet of the Founding Companies included or
incorporated by reference in each of the Registration Statement,
the most recent Preliminary Prospectus and the Prospectus, together
with the related schedules and notes, fairly present in all
material respects the financial condition of the Company and the
Founding Companies on a historical consolidated and combined, a
historical combined or historical basis, as applicable, as of the
respective dates indicated and the historical and combined and
consolidated statements of operations, cash flows and changes in
owners’ equity (deficit and minority interests) of the
Company and the combined statements of income, cash flows and
changes in partners’ capital of the Founding Companies, for
the respective periods specified, in each case in conformity with
generally accepted accounting principles applied on a consistent
basis throughout the periods involved (except as otherwise
indicated in the notes thereto) and in accordance with Regulation
S-X promulgated by the Commission. No other financial statements or
supporting schedules are required to be included or incorporated by
reference in the Registration Statement. The summary and
|
12
| |
selected historical
combined and consolidated financial data of the Company and
historical combined financial data of the Founding Companies
included in each of the Registration Statement, the most recent
Preliminary Prospectus and the Prospectus fairly present in all
material respects the information shown therein and have been
compiled on a basis consistent with that of the historical combined
and consolidated financial statements of the Company and the
combined audited financial statements of the Founding Companies
included or incorporated by reference in each of the Registration
Statement, the most recent Preliminary Prospectus and the
Prospectus. The other financial information included or
incorporated by reference in the Registration Statement, the most
recent Preliminary Prospectus and the Prospectus has been derived
from the accounting records of the Company, the Subsidiaries and
the Founding Companies, as the case may be, and present fairly, in
all material respects, the information shown thereby. The Company
and the Subsidiaries do not have any material liabilities or
obligations, direct or contingent (including any off-balance sheet
obligations), not disclosed or incorporated by reference in each of
the Registration Statement, the most recent Preliminary Prospectus
and the Prospectus.
|
| |
(ll) |
The statistical and market-related data included in each of the
Registration Statement, the most recent Preliminary Prospectus and
the Prospectus are based on or derived from sources that the
Company believes to be reliable and accurate or represent the
Company’s good faith estimates that are made on the basis of
data derived from such sources. |
| |
(mm) |
None of the Company or any of the Subsidiaries have sustained
since the date of the last audited financial statements included or
incorporated by reference in each of the Registration Statement,
the most recent Preliminary Prospectus and the Prospectus any loss
or interference with its business material to the Company and the
Subsidiaries considered as a whole, otherwise than as set forth or
contemplated in each of the most recent Preliminary Prospectus and
the Prospectus. Since the respective dates as of which information
is given in each of the Registration Statement, the most recent
Preliminary Prospectus and the Prospectus, there has not been any
(i) material change in the capitalization of the Company or
the Subsidiaries, (ii) material increase in the aggregate in
the consolidated short-term or long-term debt of the Company,
(iii) any transaction that is material to the Company and the
Subsidiaries contemplated or entered into by the Company or any of
the Subsidiaries, (iv) any obligation, contingent or
otherwise, directly or indirectly incurred by the Company or any
Subsidiary that is material to the Company and its Subsidiaries
taken as a whole or (v) any dividend or distribution of any
kind declared, paid or made by the Company on any class of its
capital stock, in each case otherwise than as set forth or
contemplated in each of the Registration Statement, the most recent
Preliminary Prospectus and the Prospectus. |
| |
(nn) |
The section
entitled “Management’s Discussion and Analysis of
Financial Condition and Results of Operations – Critical
Accounting Policies and Recently Adopted Accounting
Pronouncements” in each of the most recent
Preliminary
|
13
| |
Prospectus and the
Prospectus accurately and fully describes (A) the accounting
policies that the Company believes are the most important in the
portrayal of the Company’s financial condition and results of
operations and that require management’s most difficult,
subjective or complex judgments (“ Critical Accounting
Policies ”); (B) the judgments and uncertainties
affecting the application of critical accounting policies and
(C) the likelihood that materially different amounts would be
reported under different conditions or using different assumptions
and an explanation thereof.
|
| |
(oo) |
Malin, Berquist & Company, LLP, as of
December 31, 2007 and during the periods covered by the
balance sheet of the Company, the consolidated and combined
financial statements of the Company, the combined financial
statements of the Founding Companies and the related schedules and
notes thereto included or incorporated by reference in each of the
Registration Statement, the most recent Preliminary Prospectus and
the Prospectus on which they reported are independent public
accountants as required by the Securities Act and the Securities
Act Regulations. |
| |
(pp) |
Netherland Sewell & Associates, Inc., whose summary
reserve report dated January 18, 2008 is included as an annex
to each of the most recent Preliminary Prospectus and the
Prospectus (the “ Reserve Report Letter ”), was,
as of the date of such Reserve Report Letter, and is, as of the
date hereof, an independent petroleum engineer with respect to the
Company and the Subsidiaries. The information underlying the
estimates of reserves of the Company and the Subsidiaries used in
the preparation of the reserve reports and other estimates,
including, without limitation, production, costs of operation and
development, current prices for production, agreements relating to
current and future operations and sales of production, was true and
correct in all material respects on the dates such estimates were
made and such information was supplied and was prepared in
accordance with customary industry practices; other than normal
production of the reserves and intervening market commodity price
fluctuations described in each of the most recent Preliminary
Prospectus and the Prospectus, the Company is not aware of any
facts or circumstances that would result in a material adverse
change in the reserves, or the present value of future net cash
flows therefrom, as described in each of the most recent
Preliminary Prospectus and the Prospectus and as reflected in the
Reserve Report Letter; estimates of such reserves and present
values as described in each of the most recent Preliminary
Prospectus and the Prospectus and reflected in the Reserve Report
Letter comply in all material respects with the applicable
requirements of Regulation S-X and Industry Guide 2 under
the Securities Act. |
| |
(qq) |
Each of the
Company and the Subsidiaries maintain a system of internal
accounting controls sufficient to provide reasonable assurances
that (i) transactions are executed in accordance with
management’s general or specific authorization,
(ii) transactions are recorded as necessary to permit
preparation of financial statements in accordance with generally
accepted accounting principles and to maintain accountability for
assets, (iii) access to its assets is permitted
only
|
14
| |
in accordance with
management’s general or specific authorization and
(iv) the recorded accountability for assets is compared with
the existing assets at reasonable intervals and appropriate action
is taken with respect to any differences.
|
| |
(rr) |
(i) Each of the Company and the Subsidiaries have established
and maintain disclosure controls and procedures (as such term is
defined in Rule 13a-15 under the Exchange Act), (ii) such
disclosure controls and procedures are designed to ensure that the
information required to be disclosed by the Company and the
Subsidiaries in the reports they will file or submit under the
Exchange Act is accumulated and communicated to management of the
Company and the Subsidiaries, including their respective principal
executive officers and principal financial officers, as
appropriate, to allow timely decisions regarding required
disclosure to be made and (iii) such disclosure controls and
procedures are effective in all material respects to perform the
functions for which they were established. |
| |
(ss) |
As of the date hereof, and except as disclosed in each of the
most recent Preliminary Prospectus and the Prospectus, the Company
is not aware of (i) any “material weakness” (as
defined in Public Company Oversight Board Standard No. 2) in
the Company’s or any Subsidiary’s internal control over
financing reporting (as defined in Rule 13a-15(f)), whether or
not subsequently remediated, or (ii) any fraud, whether or not
material, that involves management or other employees who have a
significant role in the Company’s or any Subsidiary’s
internal control over financial reporting. |
| |
(tt) |
None of the Company or any Subsidiary, nor any of their
respective directors, manager, or partners, as applicable, or
officers, in their capacities as such, is in material breach or
violation of any provision of the Sarbanes Oxley Act of 2002 and
the rules and regulations promulgated in connection
therewith. |
| |
(uu) |
No relationship, direct or indirect, exists between or among
the Company, on the one hand, and the directors, officers,
stockholders, customers or suppliers of the Company, on the other
hand, that is required to be described by the Securities Act or the
Securities Act Regulations, in each of the most recent Preliminary
Prospectus and the Prospectus which is not so
described. |
| |
(vv) |
The Company’s class of common stock has been registered
under Section 12(b) of the Exchange Act, and the Securities
are listed or are approved for listing on the Nasdaq Global Market
(the “ Nasdaq ”). |
| |
(ww) |
None of the Company or the Subsidiaries or any of their
respective officers or directors has taken or will take, directly
or indirectly, any action designed to cause or result in, or which
has constituted or which might reasonably be expected to
constitute, the stabilization or manipulation of the price of the
Securities in order to facilitate the sale or resale of the
Securities or otherwise. |
15
| |
(xx) |
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 each of the most recent Preliminary Prospectus and
the Prospectus will not be, required to register as an
“investment company” as such term is defined under the
Investment Company Act of 1940, as amended (the “
Investment Company Act ”). |
| |
(yy) |
The Company has not distributed and, prior to the later to
occur of any Delivery Date and completion of the distribution of
the Securities, will not distribute any offering material in
connection with the offering and sale of the Securities other than
any Preliminary Prospectus, the Prospectus and any Issuer Free
Writing Prospectus to which KBCM has consented in accordance with
Section 4(f) hereto. |
| |
(zz) |
The Company has not sold or issued any securities that would be
integrated with the offering of the Securities contemplated by this
Agreement pursuant to the Securities Act, the Securities Act
Regulations or the interpretations thereof by the
Commission. |
Any certificate signed by any
officer of the Company and delivered to KBCM or counsel for the
Underwriters in connection with the offering of the Securities
shall be deemed a representation and warranty by the Company as to
matters covered thereby, to each Underwriter.
| 2. |
Representations and Warranties of the Selling
Stockholders . Each Selling Stockholder, severally and not
jointly, represents and warrants to, and agrees with, the several
Underwriters as follows: |
| |
(a) |
As of the First Delivery Date, such Selling Stockholder will be
the record and a beneficial owner of the Securities to be sold by
such Selling Stockholder under this Agreement, free and clear of
all adverse claims, except for those arising under this Agreement;
and upon delivery of and payment for such Securities hereunder in
accordance with the provisions of Section 3(d) hereof, the
several Underwriters will acquire a security entitlement (as that
term is defined in the Uniform Commercial Code as in effect in the
State of New York (the “ New York UCC ”) with
respect to the Securities, and no action based on an adverse claim
(as that term is defined under the New York UCC) to the Securities
may be asserted against any of the Underwriters, provided ,
that each such Underwriter does not have notice of any adverse
claim (within the meaning of Section 8-105 of the New York
UCC). Such Selling Stockholder is selling the Securities to be sold
by such Selling Stockholder for such Selling Stockholder’s
own account and is not selling such Securities, directly or
indirectly, for the benefit of the Company, and no part of the
proceeds of such sale received by such Selling Stockholder will
inure, either directly or indirectly, to the benefit of the Company
other than as described in each of the Registration Statement, the
most recent Preliminary Prospectus and Prospectus. |
| |
(b) |
Such Selling
Stockholder has duly authorized, executed and delivered an
Irrevocable Power of Attorney (“ Irrevocable Power of
Attorney ”), which Irrevocable Power of Attorney is a
valid and binding obligation of such Selling
|
16
| |
Stockholder, to
Benjamin W. Hulburt and Christopher K. Hulburt, each as
attorney-in-fact (the “ Attorneys-in-Fact ”);
pursuant to the Irrevocable Power of Attorney, the Selling
Stockholder has authorized and directed the Attorneys-in-Fact to
effect the sale and delivery of the Securities being sold by such
Selling Stockholder, to enter into this Agreement, to deliver in
accordance with this Agreement the certificates representing the
Securities to be sold by such Selling Stockholder and to take all
such other action as may be necessary hereunder and, as of the
First Delivery Date, such certificates will be duly and properly
endorsed in blank for transfer, or will be accompanied by all
documents duly and properly executed that are necessary to validate
the transfer of title thereto, to the Underwriters, free of any
legend, restriction on transferability, proxy, lien or claim,
whatsoever.
|
| |
(c) |
Such Selling Stockholder has the power and authority to enter
into this Agreement and to sell, transfer and deliver the
Securities to be sold by such Selling Stockholder pursuant to this
Agreement. |
| |
(d) |
This Agreement and the Irrevocable Power of Attorney have each
been duly authorized, executed and delivered by or on behalf of
such Selling Stockholder and constitutes a valid and binding
agreement of such Selling Stockholder, enforceable in accordance
with its terms, except as rights to indemnity thereunder may be
limited by federal or state securities laws and except as
enforceability hereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting enforcement of
creditors’ rights or by general equitable principles
(regardless of whether such enforceability is considered in a
proceeding in equity or at law). The execution and delivery of this
Agreement and the Irrevocable Power of Attorney and the performance
of the terms hereof and thereof and the consummation of the
transactions herein and therein contemplated will not
(A) conflict with, result in a breach or violation of, or
constitute a default (or an event that with notice or lapse of
time, or both, would constitute a default) under, or result in the
creation or imposition of any lien, charge or encumbrance upon any
property or assets of the Selling Stockholder pursuant to any law,
statute, rule or regulation or the terms of any indenture or other
agreement or instrument to which such Selling Stockholder is party
or bound, or to which any of the property or assets of such Selling
Stockholder is subject, or (B) if such Selling Shareholder is
not a natural person, result in any violation of the provisions of
any charter or bylaws or certificate of formation, trust agreement,
partnership agreement, articles of partnership or other
organizational documents, as applicable, of the Selling
Stockholder, or (C) result in any violation or breach of any
judgment, order, decree statute, rule or regulation applicable to
such Selling Stockholder of any court or any public, governmental
or regulatory agency or body, administrative agency or arbitrator
having jurisdiction over such Selling Stockholder, except in the
case of clauses (A) and (C) above as would not reasonably
be expected to result in a Selling Stockholder Material Adverse
Effect. |
| |
(e) |
To such
Selling Stockholder’s knowledge, no consent, approval,
authorization or order of, or filing with, any court or
governmental agency or body is required for
|
17
| |
the execution, delivery
and performance of this Agreement and the Irrevocable Power of
Attorney, including the sale of the Securities being sold by such
Selling Stockholder, except such as (i) has been obtained or
made under the Securities Act or the Exchange Act or as may be
required by state securities or “blue sky” laws or
(ii) may be required by the bylaws and rules of the
FINRA.
|
| |
(f) |
Such Selling Stockholder has not distributed and will not
distribute any prospectus or other offering material in connection
with the offering and sale of the Securities other than any
Preliminary Prospectus or the Prospectus or other materials
permitted by the Securities Act to be distributed by such Selling
Stockholder. Neither such Selling Stockholder nor any person acting
on behalf of Selling Stockholder (other than, if applicable, the
Company and the Underwriters) has used or referred to any
“free writing prospectus” (as defined in
Rule 405), relating to the Securities. |
| |
(g) |
Other than as contemplated by this Agreement and except as
disclosed in each of the Registration Statement, the most recent
Preliminary Prospectus and Prospectus, there is no broker, finder
or other party that is entitled to receive from such Selling
Stockholder any brokerage or finder’s fee or any other fee,
commission or payment as a result of the transactions contemplated
by this Agreement. |
| |
(h) |
To the knowledge of such Selling Stockholder, the Registration
Statement did not, as of the Effective Date, contain an untrue
statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading; provided , that no representation or
warranty is made as to information contained in or omitted from the
Registration Statement in reliance upon and in conformity with
written information furnished to the Company through KBCM by or on
behalf of any Underwriter specifically for inclusion therein, which
information is specified in Section 8(f). |
| |
(i) |
To the knowledge of such Selling Stockholder, each of the most
recent Preliminary Prospectus and the Prospectus will not, as of
its date and on the applicable Delivery Date, contain an untrue
statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were
made, not misleading; provided , that no representation or
warranty is made as to information contained in or omitted from the
Prospectus in reliance upon and in conformity with written
information furnished to the Company through KBCM by or on behalf
of any Underwriter specifically for inclusion therein, which
information is specified in Section 8(f). |
| |
(j) |
To the knowledge of such Selling Stockholder, the documents
incorporated by reference in any Preliminary Prospectus or the
Prospectus did not, and any further documents filed and
incorporated by reference therein will not, when filed with the
Commission, contain an untrue statement of a material fact or omit
to state a material fact required to be stated therein or necessary
to make the statements therein, in the light of the circumstances
under which they were made, not misleading. |
18
| |
(k) |
Such Selling Stockholder has not taken and will not take,
directly or indirectly, any action that is designed to or that has
constituted or that could reasonably be expected to cause or result
in the stabilization or manipulation of the price of any security
of the Company to facilitate the sale or resale of the shares of
the Securities. |
| |
(l) |
The representations and warranties of the Selling Stockholder
in its Irrevocable Power of Attorney are, and on the First Delivery
Date will be, true and correct. |
Any certificate signed by a
Selling Stockholder (if such Selling Stockholder is a natural
person) or any officer of any Selling Stockholder (if such Selling
Stockholder is an entity) and delivered to KBCM or counsel for the
Underwriters in connection with the offering of the Securities
shall be deemed a representation and warranty by such Selling
Stockholder, as to matters covered thereby, to each
Underwriter.
| 3. |
Sale, Purchase and Delivery of Securities . |
| |
(a) |
On the basis of the representations, warranties and agreements
herein contained, but subject to the terms and conditions herein
set forth, (i) the Company agrees to issue and sell 4,500,000
Firm Securities, and each Selling Stockholder agrees,
severally and not jointly, to sell the number of Firm Securities
set forth opposite the name of such Selling Stockholder in
Schedule A hereto (which in the aggregate shall be
4,000,000 Firm Securities), to the several
Underwriters, and each Underwriter agrees, severally and not
jointly, to purchase from the Company and the Selling Stockholders
the respective number of Firm Securities set forth opposite the
Underwriter’s name in Schedule B hereto, at a
purchase price per share of $19.66, and (ii) in the event and
to the extent that the Underwriters shall exercise their option to
purchase Optional Securities as provided in Section 3(b)
below, the Company agrees to sell up to an aggregate of 1,275,000
Optional Securities to the several Underwriters. The
number of Optional Securities to be purchased by each Underwriter
shall be the same percentage of the total number of Optional
Securities to be purchased by the several Underwriters as the
number of Firm Securities to be purchased by such Underwriter is of
the total number of Firm Securities to be purchased by the several
Underwriters, as adjusted by KBCM in such manner as KBCM deem
advisable to avoid fractional shares. The purchase price per share
of the Optional Securities shall be the same as that of the Firm
Securities. |
| |
(b) |
The Company
hereby grants to the Underwriters the right to purchase at their
election, up to an aggregate of 1,275,000 Optional
Securities at a purchase price per share equal to the purchase
price per share of the Firm Securities set forth in
Section 3(a) above, for the sole purpose of covering any
over-allotments in connection with the sale and distribution of the
Firm Securities. Any such election to purchase Optional Securities
may be exercised only by written notice
|
19
| |
from KBCM to the Company,
given within a period of 30 calendar days after the date of this
Agreement and setting forth the aggregate number of Optional
Securities to be purchased and the date on which such Optional
Securities are to be delivered, as determined by KBCM but in no
event earlier than the First Delivery Date (as defined below) or,
unless KBCM and the Company otherwise agree in writing, no earlier
than two or later than ten business days after the date of such
notice.
|
| |
(c) |
The several Underwriters propose to offer the Securities for
sale upon the terms and conditions and in the manner set forth in
each of the most recent Preliminary Prospectus and the
Prospectus. |
| |
(d) |
The Securities to be purchased by each Underwriter hereunder,
in definitive form, and in such authorized denominations and
registered in such names as KBCM may request upon at least
forty-eight hours’ prior notice to the Company and the
Attorneys-in-Fact, shall be delivered by or on behalf of the
Company and the Attorneys-in-Fact to the Underwriters, through the
facilities of the Depository Trust Company (“ DTC
”), for the accounts of such Underwriters, against payment by
or on behalf of the Underwriter of the purchase price therefor by
wire transfer of federal (same-day) funds to the account specified
by the Company and the Attorneys-in-Fact to KBCM at least
forty-eight hours in advance. The Company and the Attorneys-in-Fact
will cause the certificates representing the Securities to be made
available for checking and packaging at least twenty-four hours
prior to the Delivery Date (as defined below) with respect thereto
at a location in New York, New York as may be designated by you or
at the office of DTC or its designated custodian. The date of such
delivery and payment shall be, with respect to the Firm Securities,
May 5, 2008 or such other time and date as KBCM, the Company
and the Attorneys-in-Fact may agree upon in writing, and, with
respect to the Optional Securities, on the date specified by KBCM
in the written notice given by KBCM of its election to purchase
such Optional Securities, or such date as KBCM and the Company may
agree upon in writing. Such date for delivery of the Common Stock
is herein called the “ First Delivery Date ,”
such date for delivery of the Optional Securities, if not the First
Delivery Date, is herein called an “ Optional Delivery
Date ,” and each such time and date for delivery is
herein called a “ Delivery Date .” |
| |
(e) |
Time shall be of the essence, and delivery at the time and
place specified pursuant to this Agreement is a further condition
of the obligations of the Underwriters hereunder. |
| 4. |
Certain Agreements of the Company . The Company
covenants and agrees with each of the Underwriters: |
| |
(a) |
To prepare
the Prospectus in a form approved by KBCM and to file such
Prospectus pursuant to Rule 424(b) under the Securities Act
not later than the Commission’s close of business on the
second business day following the execution and delivery of this
Agreement; to make no further amendment or any
|
20
| |
supplement to the
Registration Statement or the Prospectus prior to the last Delivery
Date except as provided herein; to advise KBCM, promptly after it
receives notice thereof, of the time when any amendment or
supplement to the Registration Statement or the Prospectus has been
filed and to furnish KBCM with copies thereof; to advise KBCM,
promptly after it receives notice thereof, of the issuance by the
Commission of any stop order or of any order preventing or
suspending the use of the Prospectus or any Issuer Free Writing
Prospectus, of the suspension of the qualification of the
Securities for offering or sale in any jurisdiction, of the
initiation or threatening of any proceeding or examination for any
such purpose or of any request by the Commission for the amending
or supplementing of the Registration Statement, the Prospectus or
any Issuer Free Writing Prospectus or for additional information;
and, in the event of the issuance of any stop order or of any order
preventing or suspending the use of the Prospectus or any Issuer
Free Writing Prospectus or suspending any such qualification, to
use promptly its best efforts to obtain its withdrawal;
|
| |
(b) |
To furnish promptly to KBCM and to counsel for the Underwriters
a signed copy of the Registration Statement as originally filed
with the Commission, and each amendment thereto filed with the
Commission, including all consents and exhibits filed
therewith; |
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(c) |
To deliver promptly to KBCM such number of the following
documents as KBCM shall reasonably request: (A) conformed
copies of the Registration Statement as originally filed with the
Commission and each amendment thereto (in each case excluding
exhibits other than this Agreement and the computation of per share
earnings), (B) each Preliminary Prospectus, the Prospectus and
any amended or supplemented Prospectus, (C) each Issuer Free
Writing Prospectus and (D) any document incorporated by
reference in any Preliminary Prospectus or the Prospectus; and, if
the delivery of a prospectus is required at any time after the date
hereof in connection with the offering or sale of the Securities or
any other securities relating thereto and if at such time any
events shall have occurred as a result of which the Prospectus as
then amended or supplemented would include an untrue statement of a
material fact or omit to state any material fact necessary in order
to make the statements therein, in the light of the circumstances
under which they were made when such Prospectus is delivered, not
misleading, or, if for any other reason it shall be necessary to
amend or supplement the Prospectus in order to comply with the
Securities Act, to notify KBCM and, upon its request, to file such
document and to prepare and furnish without charge to each
Underwriter and to any dealer in securities as many copies as KBCM
may from time to time reasonably request of an amended or
supplemented Prospectus that will correct such statement or
omission or effect such compliance; |
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(d) |
To file promptly with the Commission any amendment or
supplement to the Registration Statement or the Prospectus that
may, in the judgment of the Company or KBCM, be required by the
Securities Act or requested by the Commission; |
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(e) |
Prior to filing with the Commission any amendment or supplement
to the Registration Statement, the Prospectus or any document
incorporated by reference in the Prospectus or any amendment to any
document incorporated by reference in the Prospectus, to furnish a
copy thereof to KBCM and counsel for the Underwriters and obtain
the consent of KBCM to the filing, which consent will not be
unreasonably withheld; |
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(f) |
Not to make any offer relating to the Securities that would
constitute an Issuer Free Writing Prospectus without the prior
consent of KBCM; |
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(g) |
To retain in accordance with the Securities Act Regulations all
Issuer Free Writing Prospectuses not required to be filed pursuant
to the Securities Act Regulations; and if at any time after the
date hereof any events shall have occurred as a result of which any
Issuer Free Writing Prospectus, as then amended or supplemented,
would conflict with the information in the Registration Statement,
the most recent Preliminary Prospectus or the Prospectus or would
include an untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not
misleading, or, if for any other reason it shall be necessary to
amend or supplement any Issuer Free Writing Prospectus, to notify
KBCM and, upon its request, to file such document and to prepare
and furnish without charge to each Underwriter as many copies as
KBCM may from time to time reasonably request of an amended or
supplemented Issuer Free Writing Prospectus that will correct such
conflict, statement or omission or effect such
compliance; |
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(h) |
As soon as practicable after the Effective Date (it being
understood that the Company shall have until at least 410 or, if
the fourth quarter following the fiscal quarter that includes the
Effective Date is the last fiscal quarter of the Company’s
fiscal year, 455 days after the end of the Company’s
current fiscal quarter), to make generally available to the
Company’s security holders and to deliver to KBCM an earnings
statement of the Company and the Subsidiaries (which need not be
audited) complying with Section 11(a) of the Securities Act
and the Securities Act Regulations (including, at the option of the
Company, Rule 158); |
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(i) |
Promptly from time to time to take such action as KBCM may
reasonably request to qualify the Securities for offering and sale
under the securities laws of such jurisdictions as KBCM may request
and to comply with such laws so as to permit the continuance of
sales and dealings therein in such jurisdictions for as long as may
be necessary to complete the distribution of the Securities;
provided , that in connection therewith the Company shall
not be required to (i) qualify as a foreign corporation in any
jurisdiction in which it would not otherwise be required to so
qualify, (ii) file a general consent to service of process in
any such jurisdiction or (iii) subject itself to taxation in
any jurisdiction in which it would not otherwise be
subject; |
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(j) |
For a period commencing on the date hereof and ending on the
90th day after the date of the Prospectus (the “
Lock-Up Period ”), not to, directly or indirectly,
(1) offer for sale, sell, pledge or otherwise dispose of (or
enter into any transaction or device that is designed to, or could
be expected to, result in the disposition by any person at any time
in the future of) any shares of Common Stock or securities
convertible into or exchangeable for Common Stock (other than the
Securities), or sell or grant options, rights or warrants with
respect to any shares of Common Stock or securities convertible
into or exchangeable for Common Stock (other than options or rights
granted or sold pursuant to the terms of the Company’s 2007
Long-Term Incentive Plan (the “ LTIP ”),
(2) enter into any swap or other derivatives transaction that
transfers to another, in whole or in part, any of the economic
benefits or risks of ownership of such shares of Common Stock,
whether any such transaction described in clause (1)
or (2) above is to be settled by delivery of Common Stock or
other securities, in cash or otherwise, (3) file or cause to
be filed a registration statement, including any amendments, with
respect to the registration of any shares of Common Stock or
securities convertible, exercisable or exchangeable into Common
Stock or any other securities of the Company or (4) publicly
disclose the intention to |
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