Exhibit 1.3
25,000,000 Shares
DYNCORP INTERNATIONAL
INC.
Class A Common
Stock
UNDERWRITING
AGREEMENT
May [ ],
2006
C REDIT S UISSE S ECURITIES (USA) LLC
G OLDMAN ,
S ACHS & C O .
As Representatives of the Several
Underwriters,
c/o Credit Suisse Securities (USA)
LLC,
Eleven Madison Avenue,
New York, N.Y. 10010-3629
Dear Sirs:
1. Introductory . DynCorp
International Inc., a Delaware corporation (the “
Company ”) proposes to issue and sell 25,000,000
shares of its Class A common stock (“ Securities
”) (such 25,000,000 shares of Securities being hereinafter
referred to as the “ Firm Securities ”). The
Company also proposes to issue and sell to the Underwriters, at the
option of the Underwriters, not more than 3,750,000 additional
outstanding shares of the Company’s Securities, as set forth
below (such 3,750,000 additional shares being hereinafter
referred to as the “ Optional Securities ”). The
Firm Securities and the Optional Securities are herein collectively
called the “ Offered Securities .” As part of
the offering contemplated by this Agreement, Credit Suisse
Securities (USA) LLC (the “ Designated Underwriter
”) has agreed to reserve out of the Firm Securities purchased
by it under this Agreement, up to 1,250,000 shares, for sale to the
Company’s directors, officers, employees and other parties
associated with the Company (collectively, “
Participants ”), as set forth in the Prospectus (as
defined herein) under the heading “Underwriting” (the
“ Directed Share Program ”). The Firm Securities
to be sold by the Designated Underwriter pursuant to the Directed
Share Program (the “ Directed Shares ”) will be
sold by the Designated Underwriter pursuant to this Agreement at
the public offering price. Any Directed Shares not subscribed for
by the end of the business day on which this Agreement is executed
will be offered to the public by the Underwriters as set forth in
the Prospectus. The Company hereby agrees with Credit Suisse
Securities (USA) LLC and Goldman, Sachs & Co. as
representatives (together, the “ Representatives
”) of the several underwriters named in Schedule A hereto
(“ Underwriters ”) as follows:
2. Representations and Warranties
of the Company . The Company represents and warrants to, and
agrees with, the several Underwriters that:
(i) A registration statement
(No. 333-128637) (“ initial registration
statement ”) relating to the Offered Securities,
including a form of prospectus, has been filed with the Securities
and Exchange Commission (“ Commission ”) and an
additional registration statement (“ additional
registration statement ”) relating to the Offered
Securities may have been or may be filed with the Commission
pursuant to Rule 462(b) (“ Rule 462(b) ”) under
the Securities Act of 1933 (“ Act ”). “
Initial Registration Statement ” as of any time means
the initial registration statement, in the form then filed with the
Commission, including all information contained in the additional
registration statement (if any) and then deemed to be a part of the
initial registration statement pursuant to the General Instructions
of the Form on which it is filed and all information (if any)
included in a prospectus then deemed to be a part of the initial
registration statement pursuant to Rule 430C (“
Rule 430C ”) under the Act or retroactively
deemed to be a part of the initial registration statement pursuant
to Rule 430A(b) (“ Rule 430A(b) ”) under
the Act and that in any case has not then been superseded or
modified. “ Additional Registration Statement ”
as of any time means the additional registration statement, in the
form then filed with the Commission, including the
contents of the Initial Registration
Statement incorporated by reference therein and including all
information (if any) included in a prospectus then deemed to be a
part of the additional registration statement pursuant to Rule 430C
or retroactively deemed to be a part of the additional registration
statement pursuant to Rule 430A(b) and that in any case has not
then been superseded or modified. The Initial Registration
Statement and the Additional Registration Statement are herein
referred to collectively as the “ Registration
Statements ” and individually as a “
Registration Statement ”. “ Registration
Statement ” as of any time means the Initial Registration
Statement and any Additional Registration Statement as of such
time. For purposes of the foregoing definitions, information
contained in a form of prospectus that is deemed retroactively to
be a part of a Registration Statement pursuant to Rule 430A shall
be considered to be included in such Registration Statement as of
the time specified in Rule 430A. As of the time of execution and
delivery of this Agreement, the Initial Registration Statement has
been declared effective under the Act and is not proposed to be
amended. Any Additional Registration Statement has or will become
effective upon filing with the Commission pursuant to Rule 462(b)
and is not proposed to be amended. The Offered Securities all have
been or will be duly registered under the Act pursuant to the
Initial Registration Statement and, if applicable, the Additional
Registration Statement. For purposes of this Agreement, “
Effective Time ” with respect to the Initial
Registration Statement or, if filed prior to the execution and
delivery of this Agreement, the Additional Registration Statement
means the date and time as of which such Registration Statement was
declared effective by the Commission or has become effective upon
filing pursuant to Rule 462(c) (“ Rule 462(c)
”) under the Act. If an Additional Registration Statement has
not been filed prior to the execution and delivery of this
Agreement but the Company has advised the Representatives that it
proposes to file one, “ Effective Time ” with
respect to such Additional Registration Statement means the date
and time as of which such Registration Statement is filed and
becomes effective pursuant to Rule 462(b). “ Effective
Date ” with respect to the Initial Registration Statement
or the Additional Registration Statement (if any) means the date of
the Effective Time thereof. A “ Registration Statement
” without reference to a time means such Registration
Statement as of its Effective Time. “ Statutory
Prospectus ” as of any time means the prospectus included
in a Registration Statement immediately prior to that time,
including any information in a prospectus deemed to be a part
thereof pursuant to Rule 430A or 430C that has not been superseded
or modified. For purposes of the preceding sentence, information
contained in a form of prospectus that is deemed retroactively to
be a part of a Registration Statement pursuant to Rule 430A shall
be considered to be included in the Statutory Prospectus as of the
actual time that form of prospectus is filed with the Commission
pursuant to Rule 424(b) (“ Rule 424(b) ”)
under the Act. “ Prospectus ” means the
Statutory Prospectus that discloses the public offering price and
other final terms of the Offered Securities and otherwise satisfies
Section 10(a) of the Act. “ Issuer Free Writing
Prospectus ” means any “issuer free writing
prospectus,” as defined in Rule 433, relating to the
Offered Securities in the form filed or required to be filed with
the Commission or, if not required to be filed, in the form
retained in the Company’s records pursuant to Rule 433(g).
“ General Use Issuer Free Writing Prospectus ”
means any Issuer Free Writing Prospectus that is intended for
general distribution to prospective investors, as evidenced by its
being specified on Schedule B to this Agreement. “ Limited
Use Issuer Free Writing Prospectus ” means any Issuer
Free Writing Prospectus that has been consented to by the Company
in accordance with Section 6 hereto and that is not a General
Use Issuer Free Writing Prospectus. “ Applicable Time
” means [
]:00 [a/p]m (Eastern time) on the date of this
Agreement.
(ii) (A) On the Effective Date of
the Initial Registration Statement, the Initial Registration
Statement conformed in all material respects to the requirements of
the Act and the rules and regulations of the Commission (“
Rules and Regulations ”) and did not include any
untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the
statements therein not misleading, (B) on the Effective Date
of the Additional Registration Statement (if any), each
Registration Statement conformed or will conform, in all material
respects to the requirements of the Act and the Rules and
Regulations and did not include, or will not include, any untrue
statement of a material fact and did not omit, or will not omit, to
state any material fact required to be stated therein or necessary
to make the statements therein not misleading, and (C) on the
date of this Agreement, the Initial Registration Statement and, if
the Effective Time of the Additional Registration Statement is
prior to the execution and delivery of this Agreement, the
Additional Registration Statement (if any) each conforms, and at
the time of filing of the Prospectus pursuant to Rule 424(b)
or (if no such filing is required) at the Effective Date of the
Additional Registration Statement in which the Prospectus is
included, each Registration Statement and the
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Prospectus will conform, in all
material respects to the requirements of the Act and the Rules and
Regulations, and neither of such documents includes, or will
include, any untrue statement of a material fact or omits, or will
omit, to state any material fact required to be stated therein or
necessary to make the statements therein not misleading. The
preceding sentence does not apply to statements in or omissions
from a Registration Statement or the Prospectus based upon written
information furnished to the Company by any Underwriter through the
Representatives specifically for use therein, it being understood
and agreed that the only such information is that described as such
in Section 8(b) hereof.
(iii) At the time of the initial
filing of the Initial Registration Statement and (ii) at the
date of this Agreement, the Company was not and is not an
“ineligible issuer,” as defined in Rule 405.
(iv) As of the Applicable Time,
neither (i) the General Use Issuer Free Writing Prospectus(es)
issued at or prior to the Applicable Time, the preliminary
prospectus dated April 17, 2006 (which is the most recent
Statutory Prospectus distributed to investors generally), and the
price to the public on the cover page of the Prospectus and the
statements under the caption “Description of Capital
Stock” in the Prospectus, all considered together
(collectively, the “ General Disclosure Package
”), nor (ii) any individual Limited Use Issuer Free
Writing Prospectus, when considered together with the General
Disclosure Package, included any untrue statement of a material
fact or omitted 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. The preceding sentence
does not apply to statements in or omissions from any prospectus
included in the Registration Statement or any Issuer Free Writing
Prospectus in reliance upon and in conformity with written
information furnished to the Company by any Underwriter through the
Representatives specifically for use therein, it being understood
and agreed that the only such information furnished by any
Underwriter consists of the information described as such in
Section 8(b) hereof.
(v) Each Issuer Free Writing
Prospectus, as of its issue date and at all subsequent times
through the completion of the public offer and sale of the Offered
Securities or until any earlier date that the Company notified or
notifies Credit Suisse as described in the next sentence, did not,
does not and will not include any information that conflicted,
conflicts or will conflict with the information then contained in
the Registration Statement. If at any time following issuance of an
Issuer Free Writing Prospectus there occurred or occurs an event or
development as a result of which such Issuer Free Writing
Prospectus conflicted or would conflict with the information then
contained in the Registration Statement or included or would
include an untrue statement of a material fact or omitted or would
omit to state a material fact necessary in order to make the
statements therein, in the light of the circumstances prevailing at
that subsequent time, not misleading, (i) the Company has
promptly notified or will promptly notify Credit Suisse and
(ii) the Company has promptly amended or will promptly amend
or supplement such Issuer Free Writing Prospectus to eliminate or
correct such conflict, untrue statement or omission. The foregoing
two sentences do not apply to statements in or omissions from any
Issuer Free Writing Prospectus in reliance upon and in conformity
with written information furnished to the Company by any
Underwriter through the Representatives specifically for use
therein, it being understood and agreed that the only such
information furnished by any Underwriter consists of the
information described as such in Section 8(b)
hereof.
(vi) The Company has been duly
incorporated and is an existing corporation in good standing under
the laws of the State of Delaware, with power and authority
(corporate and other) to own its properties and conduct its
business as described in the General Disclosure Package; and the
Company is duly qualified to do business as a foreign corporation
in good standing in all other 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 in any such jurisdiction would not individually or in
the aggregate, result in a material adverse effect on the condition
(financial or other), business, properties or results of operations
of the Company and its subsidiaries taken as a whole (“
Material Adverse Effect ”).
(vii) Each subsidiary of the Company
has been duly incorporated or formed, as the case may be, and is an
existing corporation or limited liability company, as the case may
be, in good standing under the laws of the jurisdiction of its
incorporation or formation, as the case may be, with power and
authority (corporate and other) to own its properties and conduct
its business as described in the General Disclosure Package; and
each subsidiary of the Company is duly qualified to do business as
a foreign corporation or
3
limited liability company in good
standing in all other 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 in any such jurisdiction would not individually or in
the aggregate, result in a Material Adverse Effect; all of the
issued and outstanding capital stock or membership interests, as
the case may be, of each subsidiary of the Company has been duly
authorized and validly issued and is fully paid and nonassessable;
and the capital stock or membership interests, as the case may be,
of each subsidiary owned by the Company, directly or through
subsidiaries, is owned free from liens, encumbrances and defects,
except where the existence of such liens, encumbrances or claims
would not have a Material Adverse Effect.
(viii) The Offered Securities and
all other outstanding shares of capital stock of the Company have
been duly authorized and, when the Offered Securities have been
delivered and paid for in accordance with this Agreement on each
Closing Date (as defined below), such Offered Securities will have
been validly issued, fully paid and nonassessable, will be
consistent with the information in the General Disclosure Package
and will conform in all material respects to the description
thereof contained in the Prospectus; and the stockholders of the
Company have no preemptive rights with respect to the
Securities.
(ix) Except as disclosed in the
General Disclosure Package, there are no contracts, agreements or
understandings between the Company and any person that would give
rise to a valid claim against the Company or any Underwriter for a
brokerage commission, finder’s fee or other like payment in
connection with this offering.
(x) No consent, approval,
authorization, or order of, or filing with, any governmental agency
or body or any court is required to be obtained or made by the
Company for the consummation of the transactions contemplated by
this Agreement in connection with the sale of the Offered
Securities, except (i) such as have been obtained or will be
obtained prior to the consummation of the offering and made under
the Act, (ii) such as may be required under state securities
laws, (iii) such as may be required under the rules and
regulations of the National Association of Securities Dealers, Inc.
(the “ NASD ”) and (iv) the filing of the
Prospectus with the Commission.
(xi) Except as disclosed in the
Prospectus, there are no contracts, agreements or understandings
between the Company and any person granting such person the right
to require the Company to file a registration statement under the
Act with respect to any securities of the Company owned or to be
owned by such person or to require the Company to include such
securities in the securities registered pursuant to a Registration
Statement or in any securities being registered pursuant to any
other registration statement filed by the Company under the
Act.
(xii) The execution, delivery and
performance of this Agreement, and the consummation of the
transactions herein contemplated will not result in a breach or
violation of any of the terms and provisions of, or constitute a
default under (assuming compliance with all applicable “Blue
Sky” laws), (i) any statute, any rule, regulation or
order of any governmental agency or body or any court, domestic or
foreign, having jurisdiction over the Company or any subsidiary of
the Company or any of their properties, (ii) any agreement or
instrument to which the Company or any such subsidiary is a party
or by which the Company or any such subsidiary is bound or to which
any of the properties of the Company or any such subsidiary is
subject, or (iii) the charter or by-laws of the Company or any
such subsidiary (except, in the case of clauses (i) and (ii),
where any such breach, violation or default would not, individually
or in the aggregate, have a Material Adverse Effect).
(xiii) This Agreement has been duly
authorized, executed and delivered by the Company.
(xiv) Except as disclosed in the
General Disclosure Package, the Company and its subsidiaries have
good and marketable title to all personal property and assets owned
by them, in each case free from liens, encumbrances and defects
that would materially affect the value thereof or materially
interfere with the use made or to be made thereof by them; and
except as disclosed in the General Disclosure Package, the Company
and its subsidiaries hold any leased real or personal property
under valid and enforceable leases with such exceptions as would
not individually or in the aggregate have a Material Adverse
Effect.
4
(xv) Neither the Company or any of
its subsidiaries own any real property.
(xvi) The Company and its
subsidiaries possess adequate certificates, authorities or permits
issued by appropriate governmental agencies or bodies necessary to
conduct the business now operated by them and have not received any
notice of proceedings relating to the revocation or modification of
any such certificate, authority or permit that, if determined
adversely to the Company or any of its subsidiaries, would
individually or in the aggregate have a Material Adverse
Effect.
(xvii) No labor dispute with the
employees of the Company or any subsidiary exists or, to the
knowledge of the Company, is imminent that would reasonably be
expected to have a Material Adverse Effect.
(xviii) The Company and its
subsidiaries own, possess or reasonably believe they 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
(except such as will not individually or in the aggregate
reasonably be expected to have a Material Adverse Effect), 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 its
subsidiaries, would individually or in the aggregate have a
Material Adverse Effect.
(xix) Except as disclosed in the
General Disclosure Package, neither the Company nor any of its
subsidiaries is in violation of any statute, any rule, regulation,
decision or order of any governmental agency or body or any court,
domestic or foreign, relating to the use, disposal or release of
hazardous or toxic substances or relating to the protection or
restoration of the environment or human exposure to hazardous or
toxic substances (collectively, “ environmental laws
”), owns or operates any real property contaminated with any
substance that is subject to any environmental laws, is liable for
any off-site disposal or contamination pursuant to any
environmental laws, or is subject to any claim relating to any
environmental laws, which violation, contamination, liability or
claim would individually or in the aggregate have a Material
Adverse Effect; and the Company is not aware of any pending
investigation which might lead to such a claim.
(xx) Except as disclosed in the
General Disclosure Package, there are no pending actions, suits or
proceedings against or affecting the Company, any of its
subsidiaries or any of their respective properties that, if
determined adversely to the Company or any of its subsidiaries,
would individually or in the aggregate have a Material Adverse
Effect, or would materially and adversely affect the ability of the
Company to perform its obligations under this Agreement, or which
are otherwise material in the context of the sale of the Offered
Securities; and, to the Company’s knowledge, no such actions,
suits or proceedings are threatened or contemplated.
(xxi) The financial statements
included in each Registration Statement and the General Disclosure
Package present fairly and in all material respects the financial
position of the Company and its consolidated subsidiaries as of the
dates shown and their results of operations and cash flows for the
periods shown, and, except as otherwise disclosed in the
Prospectus, such financial statements have been prepared in
conformity with the generally accepted accounting principles in the
United States applied on a consistent basis and the schedules
included in each Registration Statement present fairly and in all
material respects the information required to be stated therein and
the assumptions used in preparing the pro forma financial
statements included in each Registration Statement and the General
Disclosure Package provide a reasonable basis for presenting the
significant effects directly attributable to the transactions or
events described therein, the related pro forma adjustments give
appropriate effect to those assumptions, and the pro forma columns
therein reflect the proper application of those adjustments to the
corresponding historical financial statement amounts.
(xxii) Except as disclosed in the
General Disclosure Package, since the date of the latest audited
financial statements included in the General Disclosure Package
there has been no material adverse change, nor any development or
event involving a prospective material adverse change, in the
condition (financial
5
or other), business, properties or
results of operations of the Company and its subsidiaries taken as
a whole, and, except as disclosed in or contemplated by the General
Disclosure Package, there has been no dividend or distribution of
any kind declared, paid or made by the Company on any class of its
capital stock.
(xxiii) Except as disclosed in the
General Disclosure Package, the Company is not aware of
(A) any material weaknesses in its internal control over
financial reporting or (B) change in the Company’s
internal control over financial reporting that has materially
adversely affected, or is reasonably likely to materially adversely
affect, the Company’s internal control over financial
reporting;
(xxiv) Solely to the extent that the
Sarbanes-Oxley Act has been applicable to the Company, there is and
has been no failure on the part of the Company to comply in all
material respects with any provision of the Sarbanes-Oxley Act of
2002 and the rules and regulations promulgated in connection
therewith;
(xxv) The Company is not and, after
giving effect to the offering and sale of the Offered Securities
and the application of the proceeds thereof as described in the
General Disclosure Package, will not be an “investment
company” as defined in the Investment Company Act of
1940.
(xxvi) Neither the Company nor any
of its affiliates does business with the government of Cuba or with
any person or affiliate located in Cuba within the meaning of
Section 517.075, Florida Statutes and the Company agrees to
comply with such Section if prior to the completion of the
distribution of the Offered Securities it commences doing such
business.
(xxvii) Neither the Company nor any
of its subsidiaries nor, to its knowledge, any director, officer,
employee or other person associated with or acting on behalf of the
Company or any of its subsidiaries has (A) used any corporate
funds for any unlawful contribution, gift, entertainment or other
unlawful expense relating to political activity, (B) made any
direct or indirect unlawful payment to any foreign or domestic
government official or employee from corporate funds,
(C) caused the Company or any of its subsidiaries to be in
violation of any provision of the U.S. Foreign Corrupt Practices
Act of 1977 when such regulation becomes applicable to the Company
or any of its subsidiaries, or (iv) made any bribe, rebate,
payoff, influence payment, kickback or other unlawful
payment;
(xxviii) The Company represents and
warrants to the Underwriters that (A) the Registration
Statement, the Prospectus, and, at the Applicable Time, any
Statutory Prospectus and any Issuer Free Writing Prospectus comply,
and any further amendments or supplements thereto will comply with
any applicable laws or regulations of foreign jurisdictions in
which the Prospectus, any Statutory Prospectus or any Issuer Free
Writing Prospectus, as amended or supplemented, if applicable, are
distributed in connection with the Directed Share Program, and that
(B) no authorization, approval, consent, license, order,
registration or qualification of or with any government,
governmental instrumentality or court, other than such as have been
obtained, is necessary under the securities law and regulations of
foreign jurisdictions in which the Directed Shares are offered
outside the United States.
(xxix) The Company has not offered,
or caused the Underwriters to offer, any offered Securities to any
person pursuant to the Directed Share Program with the specific
intent to unlawfully influence (A) a customer or supplier of
the Company to alter the customer’s or supplier’s level
or type of business with the Company or (B) a trade journalist
or publication to write or publish favorable information about the
Company or its products.
(xxx) DIV Holding LLC owns one
hundred percent (100%) of the issued and outstanding
Securities.
3. Purchase, Sale and Delivery of
Offered Securities . On the basis of the representations,
warranties and agreements and subject to the terms and conditions
set forth herein, the Company agrees to sell to each Underwriter,
and each Underwriter agrees, severally and not jointly, to purchase
from the Company, at a purchase
6
price of $[ ] per share,
the number of Firm Securities set forth below the caption
“Company” and opposite the name of such Underwriter in
Schedule A hereto.
The Company will deliver the Firm
Securities to the Representatives for the accounts of the
Underwriters, against payment of the purchase price in Federal
(same day) funds by wire transfer to an account at a bank
acceptable to Credit Suisse Securities (USA) LLC (“ Credit
Suisse ”), at the office of Schulte Roth & Zabel
LLP, 919 Third Avenue, New York, New York 10022, at 9:30 A.M., New
York City time, on
[ ],
2006, or at such other time not later than seven full business days
thereafter as Credit Suisse and the Company determine, such time
being herein referred to as the “ First Closing Date.
” For purposes of Rule 15c6-1 under the Securities Exchange
Act of 1934, the First Closing Date (if later than the otherwise
applicable settlement date) shall be the settlement date for
payment of funds and delivery of securities for all the Offered
Securities sold pursuant to the offering. The certificates for the
Firm Securities so to be delivered will be in such denominations
and registered in such names as Credit Suisse requests and will be
made available for checking and packaging at the above office of
Schulte Roth & Zabel LLP at least 24 hours prior to
the First Closing Date.
In addition, upon written notice
from Credit Suisse given to the Company from time to time not more
than 30 days subsequent to the date of the Prospectus, the
Underwriters may purchase all