<PAGE>
EXHIBIT 1.1
10,000,000
DELEK US HOLDINGS, INC.
COMMON STOCK
UNDERWRITING AGREEMENT
_______ __, 2006
LEHMAN BROTHERS INC.
CITIGROUP GLOBAL MARKETS INC.,
As Representatives of the several
Underwriters named in
Schedule 1 attached hereto,
c/o Lehman Brothers Inc.
745 Seventh Avenue
New York, New York 10019
Ladies and Gentlemen:
Delek US Holdings, Inc., a Delaware corporation (the
"COMPANY"),
proposes to sell 10,000,000 shares (the "FIRM STOCK") of the
Company's common
stock, par value $0.01 per share (the "COMMON STOCK"). In addition,
the Company
proposes to grant to the underwriters (the "UNDERWRITERS") named in
Schedule 1
attached to this agreement (this "AGREEMENT") an option to purchase
up to
1,500,000 additional shares of the Common Stock on the terms set
forth in
Section 2 (the "OPTION STOCK"). The Firm Stock and the Option
Stock, if
purchased, are hereinafter collectively called the "STOCK." This is
to confirm
the agreement concerning the purchase of the Stock from the Company
by the
Underwriters.
1. Representations, Warranties and Agreements of the Company.
The
Company represents, warrants and agrees that:
(a) A registration statement on Form S-1 relating to the Stock
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 "RULES AND 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 the
representatives (the "REPRESENTATIVES") of the Underwriters. As
used in
this
Agreement:
(i) "APPLICABLE TIME" means [ ] [a.m.][p.m.] (New York City
time) on the date of this Agreement;
(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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2
(iii) "ISSUER FREE WRITING PROSPECTUS" means each "free
writing prospectus" (as defined in Rule 405 of the Rules and
Regulations) prepared by or on behalf of the Company or used or
referred to by the Company in connection with the offering of
the
Stock;
(iv) "PRELIMINARY PROSPECTUS" means any preliminary prospectus
relating to the Stock included in such registration statement
or
filed with the Commission pursuant to Rule 424(b) of the Rules
and
Regulations;
(v) "PRICING DISCLOSURE PACKAGE" means, as of the Applicable
Time, the most recent Preliminary Prospectus, together with
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 Rules and Regulations;
(vi) "PROSPECTUS" means the final prospectus relating to the
Stock, as filed with the Commission pursuant to Rule 424(b) of
the
Rules and Regulations; and
(vii) "REGISTRATION STATEMENT" means such registration
statement, as amended as of the Effective Date, including any
Preliminary Prospectus or the Prospectus and all exhibits to
such
registration statement.
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, to the
Company's
knowledge,
threatened by the Commission.
(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 Rules and Regulations) of the Stock, is
not on the
date hereof and will not be on the applicable Delivery Date (as
defined in
Section 4) an "ineligible issuer" (as defined in Rule 405).
(c) 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 Rules and Regulations.
The
Preliminary Prospectus conformed, and the Prospectus will conform,
in all
material
respects when filed with the Commission pursuant to Rule 424(b)
and on the
applicable Delivery Date to the requirements of the Securities
Act and
the Rules and Regulations.
(d) 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
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3
furnished
to the Company through the Representatives by or on behalf of
any
Underwriter specifically for inclusion therein, which information
is
specified
in Section 8(e).
(e) 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 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 the
Representatives by or on behalf of any Underwriter specifically
for
inclusion
therein, which information is specified in Section 8(e).
(f) The Pricing Disclosure Package, when considered together
with
the public
offering price of the Stock, number of shares of Stock and the
underwriting discount included on the cover page of the Prospectus,
as of
the
Applicable Time, did not contain an untrue statement of a
material
fact or
omit to state a material fact 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 the Representatives by or on behalf of any Underwriter
specifically for inclusion therein, which information is specified
in
Section
8(e).
(g) 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 public offering price of the
Stock,
number of shares of Stock and the underwriting discount included
on
the cover
page of the Prospectus and 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 necessary to make the statements
therein,
in the light of the circumstances under which they were made,
not
misleading.
(h) Each Issuer Free Writing Prospectus conformed or will conform
in
all
material respects to the requirements of the Securities Act and
the
Rules and
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 Rules
and
Regulations. The Company has not made any offer relating to the
Stock
that would
constitute an Issuer Free Writing Prospectus without the prior
written
consent of the Representatives. The Company has retained in
accordance
with the Rules and Regulations all Issuer Free Writing
Prospectuses that were not required to be filed pursuant to the
Rules and
Regulations. The Company has taken all actions necessary so that
any "road
show" (as
defined in Rule 433 of the Rules and Regulations) in connection
with the
offering of the Stock will not be required to be filed pursuant
to the
Rules and Regulations.
(i) Each of the Company and its subsidiaries (as defined in
Section
17) has
been duly organized, is validly existing and, except for
subsidiaries that are partnerships,
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4
in good
standing as a corporation or other business entity under the
laws
of its
jurisdiction of organization and is duly qualified to do
business
and,
except for subsidiaries that are partnerships, in good standing as
a
foreign
corporation or other business entity in each jurisdiction in
which
its
ownership or lease of property or the conduct of its businesses
requires
such qualification, except where the failure to be so qualified
or in good
standing would not, individually or in the aggregate,
reasonably
be expected to have a material adverse effect on the business,
financial
condition, results of operations or prospects of the Company
and
its
subsidiaries, taken as a whole (a "MATERIAL ADVERSE EFFECT"). Each
of
the
Company and its subsidiaries has all corporate, partnership or
limited
liability
company power and authority necessary to own or hold its
properties
and to conduct the businesses in which it is engaged, except as
would not
reasonably be expected to have, individually or in the
aggregate,
a Material Adverse Effect. The Company does not own or control,
directly
or indirectly, any corporation, association or other entity
other
than the
subsidiaries listed in Exhibit 21.1 to the Registration
Statement.
None of the subsidiaries of the Company other than MAPCO
Express,
Inc. and Delek Refining, Inc. is a "significant subsidiary" (as
defined in
Rule 405).
(j) The Company has an authorized capitalization as set forth
in
each of
the most recent Preliminary Prospectus and the Prospectus, and
all
of the
issued shares of capital stock of the Company have been duly
authorized
and validly issued, are fully paid and non-assessable, conform
in all
material respects to the description thereof contained in each
of
the most
recent Preliminary Prospectus and the Prospectus and were
issued
in
compliance with federal and state securities laws and not in
violation
of any
preemptive right, resale right, right of first refusal or
similar
right. All
of the Company's outstanding options, warrants and other rights
to
purchase or exchange any securities for shares of the Company's
capital
stock have
been duly authorized and validly issued, conform in all
material
respects to the description thereof contained in each of the
most
recent
Preliminary Prospectus and the Prospectus and were issued in
compliance
with federal and state securities laws. All of the issued
shares of
capital stock of each subsidiary of the Company that is a
corporation have been duly authorized and validly issued and are
fully
paid and
non-assessable; all of the outstanding partnership interests of
Delek
Refining, Ltd. have been duly authorized and validly issued; all
of
the
outstanding membership interests of Delek U.S. Refining GP, LLC
have
been duly
authorized and validly issued; and all of the issued shares of
capital
stock, partnership interests and membership interests of each
subsidiary
of the Company are owned directly or indirectly by the Company,
free and
clear of all liens, encumbrances, equities or claims, except
for
such
liens, encumbrances, equities or claims (i) created under debt
agreements
referred to or described in the most recent Preliminary
Prospectus
and the Prospectus or filed as exhibits to the Registration
Statement,
or (ii) as would not reasonably be expected to have,
individually or in the aggregate, a Material Adverse Effect.
(k) The shares of the Stock to be issued and sold by the Company
to
the
Underwriters hereunder have been duly authorized and, upon payment
and
delivery
in accordance with this Agreement, will be validly issued,
fully
paid and
non-assessable, will conform to the description thereof
contained
in each of
the most recent Preliminary Prospectus and the Prospectus, will
be issued
in compliance with federal and state
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5
securities
laws and will be free of statutory and contractual preemptive
rights,
rights of first refusal and similar rights.
(l) 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.
(m) The execution, delivery and performance of this Agreement by
the
Company,
the consummation of the transactions contemplated hereby and
the
application of the proceeds from the sale of the Stock as described
under
"Use of
Proceeds" in each of 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 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
properties or assets, except, in the case of clause (i) or
(iii),
where such
conflict, breach, violation, imposition of a lien, charge or
encumbrance or default would not reasonably be expected to
have,
individually or in the aggregate, a Material Adverse Effect.
(n) No consent, approval, authorization or order of, or filing
or
registration with, any court or governmental agency or body
having
jurisdiction over the Company or any of its subsidiaries or any of
their
properties
or assets is required for 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 Stock as described under "Use of Proceeds" in each of the
most
recent
Preliminary Prospectus and the Prospectus, except for the
registration of the Stock under the Securities Act and such
consents,
approvals,
authorizations, registrations or qualifications as may be
required
under the Securities Exchange Act of 1934, as amended (the
"EXCHANGE ACT"), and
applicable state securities laws in connection with
the
purchase and sale of the Stock by the Underwriters, and such
consents
as may be
required by the New York Stock Exchange or the by-laws and
rules
of the
National Association of Securities Dealers, Inc. (the "NASD")
in
connection
with the purchase and distribution of the Stock by the
Underwriters.
(o) Except as identified in the most recent Preliminary
Prospectus
and the
Prospectus or filed as exhibits to the Registration Statement,
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 Securities Act with respect to
any
securities
of the Company owned or to be owned by such person or to
require
the Company to include such securities in the securities
registered
pursuant to the Registration Statement or in any securities
being
registered
<PAGE>
6
pursuant
to any other registration statement filed by the Company under
the
Securities Act.
(p) The Company has not sold or issued any securities that would
be
integrated
with the offering of the Stock contemplated by this Agreement
pursuant
to the Securities Act, the Rules and Regulations or the
interpretations thereof by the Commission.
(q) (i) Neither the Company nor any of its subsidiaries has
sustained,
since the date of the latest audited financial statements
included
in the most recent Preliminary Prospectus, any loss or
interference with its business from fire, explosion, flood or
other
calamity,
whether or not covered by insurance, or from any labor dispute
or court
or governmental action, order or decree, and (ii) since such
date,
there has not been any change in the capital stock or increase
in
the long-term
debt of the Company or any of its subsidiaries or any
adverse
change, or any development involving a prospective adverse
change,
in or
affecting the business, financial condition, results of
operations
or
prospects of the Company and its subsidiaries taken as a whole, in
the
case of
clause (i) or (ii), except as would not, individually or in the
aggregate,
reasonably be expected to have a Material Adverse Effect.
(r) Since the date as of which information is given in the most
recent
Preliminary Prospectus and except as may otherwise be described
in
the most
recent Preliminary Prospectus, the Company has not (i) incurred
any
material liability or obligation, direct or contingent, other
than
liabilities and obligations that were incurred in the ordinary
course of
business,
(ii) entered into any material transaction not in the ordinary
course of
business or (iii) declared or paid any dividend on its capital
stock.
(s) The historical financial statements (including the related
notes
and
supporting schedules) of the Company and, to the Company's
knowledge,
the
historical financial statements (including the related notes
and
supporting
schedules) of the Tyler Refinery and McMurrey Pipeline and
Williamson
Oil Co., Inc. and Subsidiaries included in the most recent
Preliminary Prospectus comply as to form in all material respects
with the
applicable
requirements of Regulation S-X under the Securities Act and
present
fairly the financial condition, results of operations and cash
flows of
the entities purported to be shown thereby at the dates and for
the
periods indicated and have been prepared in conformity with
accounting
principles
generally accepted in the United States applied on a consistent
basis
throughout the periods involved.
(t) The pro forma financial statements included in the most
recent
Preliminary Prospectus include assumptions that provide a
reasonable basis
for
presenting the significant effects directly attributable to the
transactions and events described therein, the related pro
forma
adjustments give appropriate effect to those assumptions, and the
pro
forma
adjustments reflect the proper application of those adjustments
to
the
historical financial statement amounts in the pro forma
financial
statements
included in the most recent Preliminary Prospectus. The pro
forma
financial statements included in the most recent Preliminary
Prospectus
comply as to form in all material respects with the applicable
requirements of Regulation S-X under the Act.
<PAGE>
7
(u) Ernst & Young LLP, who have audited certain financial
statements
of the
Company and its consolidated subsidiaries, whose report appears
in
the most
recent Preliminary Prospectus and who have delivered the
initial
letter
referred to in Section 7(g) hereof, are an independent
registered
public
accounting firm with respect to the Company for the fiscal
years
ended
December 31, 2002, 2003 and 2005 as required by the Securities
Act
and the
Rules and Regulations; and Mayer Hoffman McCann P.C., whose
report
appears in
the most recent Preliminary Prospectus and who have delivered
the
initial letter referred to in Section 7(i) hereof, are an
independent
registered
public accounting firm with respect to the Company for the year
ended
December 31, 2004 as required by the Securities Act and the
Rules
and
Regulations.
(v) The Company and each of its subsidiaries have good and
marketable
title in fee simple to all real property used in the ordinary
course of
business by the Company or its subsidiaries and good and
marketable
title to all personal property owned by them, in each case free
and clear
of all monetary liens (other than for real property taxes and
assessments not yet due and payable), except such as are described
in the
most
recent Preliminary Prospectus or such as do not materially
interfere
with the
use made of such property by the Company and its subsidiaries,
and all
assets held under lease by the Company and its subsidiaries are
held by
them under valid, subsisting and enforceable leases, with such
exceptions
as do not materially interfere with the use made of such assets
by the
Company and its subsidiaries.
(w) The Company and each of its subsidiaries carry, or are
covered
by,
insurance from insurers of recognized financial responsibility in
such
amounts
and covering such risks as the Company and its subsidiaries
reasonably
consider adequate for the conduct of their respective
businesses
and the value of their respective properties. All such policies
of
insurance of the Company and its subsidiaries are in full force
and
effect.
There are no material claims by the Company or any of its
subsidiaries under any such policy or instrument as to which any
insurance
company is
denying liability or defending under a reservation of rights
clause.
The Company and its subsidiaries reasonably believe that they
will
be able to
renew their existing insurance coverage as and when such
coverage
expires or to obtain replacement coverage adequate for the
conduct of
their respective businesses at a cost that would not reasonably
be
expected to have a Material Adverse Effect.
(x) The statistical and market-related data included under the
captions
"Prospectus Summary," "Management's Discussion and Analysis of
Financial
Condition and Results of Operations," "Our Industry" and
"Business"
in the most recent Preliminary Prospectus are based on or
derived
from sources that the Company believes to be reliable and
accurate
in all
material respects.
(y) Neither the Company nor any subsidiary is, and as of the
applicable
Delivery Date and, after giving effect to the offer and sale of
the Stock
and the application of the net proceeds therefrom as described
under "Use
of Proceeds" in the most recent Preliminary Prospectus and the
Prospectus, none of them will be, (i) an "investment company"
within the
meaning of
such term under the Investment Company Act of 1940, as amended
(the
"INVESTMENT COMPANY ACT"), and the rules and
<PAGE>
8
regulations of the Commission thereunder or (ii) a "business
development
company"
(as defined in Section 2(a)(48) of the Investment Company Act).
(z) There are no legal or governmental proceedings pending to
which
the
Company or any of its subsidiaries is a party or of which any
property
or assets
of the Company or any of its subsidiaries is the subject that
would,
individually or in the aggregate, reasonably be expected to have
a
Material
Adverse Effect or would, individually or in the aggregate,
reasonably
be expected to have a material adverse effect on the
performance of this Agreement by the Company or the consummation of
the
transactions contemplated hereby by the Company; and to the
Company's
knowledge,
no such proceedings are threatened or contemplated by
governmental authorities or others.
(aa) There are no legal or governmental proceedings or contracts
or
other
documents of a character required to be described in the
Registration Statement or the most recent Preliminary Prospectus
or, in
the case
of documents, to be filed as exhibits to the Registration
Statement,
that are not described and filed as required. Neither the
Company
nor any of its subsidiaries has knowledge that any other party
to
any such
contract, agreement or arrangement has any intention not to
perform in
all material respects as contemplated by the terms thereof; and
that
statements made in the most recent Preliminary Prospectus under
the
caption
"Business - Government Regulation and Environmental Matters"
insofar as
they describe the terms of statutes, rules or regulations,
legal or
governmental proceedings or contracts and other documents,
accurately
describe the terms of such statutes, rules and regulations,
legal and
governmental proceedings and contracts and other documents in
all
material respects.
(bb) Except as described in the most recent Preliminary
Prospectus,
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
in the most recent Preliminary Prospectus or the Prospectus
which is
not so described.
(cc) No labor disturbance by the employees of the Company or
its
subsidiaries exists or, to the knowledge of the Company, is
imminent that
would
reasonably be expected to have a Material Adverse Effect.
(dd) (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 its "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 all material respects 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
<PAGE>
9
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)
neither the Company or any member of its 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 has received a favorable determination or opinion letter
from
the
Internal Revenue Service that it is so qualified and nothing
has
occurred,
whether by action or by failure to act, which would cause the
loss of
such qualification.
(ee) (i) The Company and each of its subsidiaries have filed
all
federal,
state, local and foreign income and franchise tax returns
required
to be filed through the date hereof, subject to permitted
extensions, and have paid all taxes due thereon, and (ii) no
tax
deficiency has
been determined adversely to the Company or any of its
subsidiaries which is currently outstanding, except, in the case of
clause
(i) or
(ii), as would not, individually or in the aggregate, reasonably
be
expected
to have a Material Adverse Effect.
(ff) 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
Stock.
(gg) Neither the Company nor any of its subsidiaries (i) is in
violation
of its charter or by-laws (or similar organizational
documents),
(ii) is in
default, and no event has occurred that, with notice or lapse
of time or
both, would constitute such a default, in the due performance
or
observance of any term, covenant or condition contained in any
indenture,
mortgage, deed of trust, loan agreement, license or other
agreement
or instrument to which it is a party or by which it is bound or
to which
any of its properties or assets 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 case
of
clauses
(ii) and (iii), to the extent any such conflict, breach,
violation
or default
would not, individually or in the aggregate, reasonably be
expected
to have a Material Adverse Effect.
(hh) The Company and each of its subsidiaries (i) maintain
records
that in
reasonable detail accurately and fairly reflect transactions
and
dispositions of assets and (ii) maintain a system of internal
accounting
controls
sufficient to provide reasonable assurance that (A)
transactions
are
executed in accordance with management's general or specific
authorizations, (B) transactions are recorded as necessary to
permit
preparation of financial statements in conformity with generally
accepted
accounting
principles and to maintain asset accountability, (C) access to
assets is
permitted only in accordance with management's general or
specific
authorization and (D) the recorded accountability for
<PAGE>
10
assets is
compared with the existing assets at reasonable intervals and
appropriate action is taken with respect to any material
differences.
(ii) Except as disclosed in the most recent Preliminary
Prospectus,
since the
date of the most recent balance sheet of the Company and its
consolidated subsidiaries reviewed or audited by Ernst & Young
LLP, the
Company
has not been advised of (A) any significant deficiencies in the
design or
operation of internal controls that would reasonably be
expected
to
adversely affect the ability of the Company and each of its
subsidiaries to record, process, summarize and report financial
data, or
any
material weaknesses in internal controls and (B) any fraud, whether
or
not
material, that involves management or other employees who have
a
significant role in the internal controls of the Company and each
of its
subsidiaries.
(jj) The Company and its directors or officers, in their
capacities
as such,
are in compliance, in all material respects, with the
applicable
provisions
of the Sarbanes-Oxley Act of 2002 and the rules and regulations
promulgated in connection therewith.
(kk) The section entitled "Management's Discussion and Analysis
of
Financial
Condition and Results of Operations - Critical Accounting
Policies" in the
most recent Preliminary 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.
(ll) The Company and each of its subsidiaries have such
permits,
licenses,
patents, franchises, certificates of need and other approvals
or
authorizations of governmental or regulatory authorities
("PERMITS") as
are
necessary under applicable law to own their properties and
conduct
their
businesses in the manner described in the most recent
Preliminary
Prospectus, except for any of the foregoing that would not,
individually
or in the
aggregate, reasonably be expected to have a Material Adverse
Effect or
except as described in the most recent Preliminary Prospectus;
each of
the Company and its subsidiaries has fulfilled and performed
all
of its
material obligations with respect to the Permits, and no event
has
occurred
that allows, or after notice or lapse of time would allow,
revocation
or termination thereof or results in any other impairment of
the rights
of the holder or any such Permits, except for any of the
foregoing
that would not, individually or in the aggregate, reasonably be
expected
to have a Material Adverse Effect or except as described in the
most
recent Preliminary Prospectus.
(mm) The Company and each of its subsidiaries own or possess
adequate
rights to use all material patents, patent applications,
trademarks, service marks, trade names, trademark registrations,
service
mark
registrations, copyrights, licenses, know-how, software, systems
and
technology
(including trade secrets and other unpatented and/or
unpatentable proprietary or confidential information, systems
or
procedures) necessary for the conduct of their respective
businesses, and,
to the
Company's knowledge, the
<PAGE>
11
conduct of
their respective businesses will not conflict with, and the
Company
and its subsidiaries have not received any notice of any claim
of
conflict
with, any such rights of others, except for any of the
foregoing
that would
not, individually or in the aggregate, reasonably be expected
to result
in a Material Adverse Effect.
(nn) The Company and each of its subsidiaries (i) are, and at
all
times
prior hereto were, in compliance with all applicable laws,
regulations, ordinances, rules, orders, judgments, decrees, permits
or
other
legal requirements of any governmental authority, including
without
limitation
any national, state, regional, or local authority, relating to
the
protection of human health or safety, the environment, or
natural
resources,
or to hazardous or toxic substances or wastes, pollutants or
contaminants ("ENVIRONMENTAL LAWS") applicable to such entity,
which
compliance
includes, without limitation, obtaining, maintaining and
complying with
all permits and authorizations and approvals required by
Environmental Laws to conduct their respective businesses, and (ii)
have
not
received notice of any actual or alleged violation of
Environmental
Laws, or
of any potential liability for or other obligation concerning
the
presence,
disposal or release of hazardous or toxic substances or wastes,
pollutants
or contaminants, except in the case of clause (i) or (ii) where
such
non-compliance, violation, liability, or other obligation would
not,
individually or in the aggregate, reasonably be expected to have
a
Material
Adverse Effect or has been described in the most recent
Preliminary Prospectus. Except as described in the most recent
Preliminary
Prospectus, (A) there are no proceedings that are pending, or, to
the
knowledge
of the Company, contemplated, against the Company or any of its
subsidiaries under Environmental Laws in which a governmental
authority is
also a
party, other than such proceedings regarding which it is
reasonably
believed
no monetary sanctions of $100,000 or more will be imposed, and
(B) the
Company and its subsidiaries have not received written notice
of
any
threatened action, claim or notice of non-compliance or
violation,
investigation or proceeding with respect to Environmental Laws,
or
liabilities or other obligations under Environmental Laws or
concerning
hazardous
or toxic substances or wastes, pollutants or contaminants, that
would
reasonably be expected, individually or in the aggregate, to have
a
Material
Adverse Effect.
(oo) Neither the Company nor 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, except for those violations that would not,
individually or in the aggregate, reasonably be expected to have
a
Material
Adverse Affect.
(pp) Except as described in or contemplated by the most recent
Preliminary Prospectus, no subsidiary of the Company is
currently
prohibited, directly or indirectly, from paying any dividends to
the
Company,
from making any other distribution on such subsidiary's capital
stock,
from repaying to the Company any loans or advances to such
subsidiary
from the Company or from transferring any of such subsidiary's
property
or assets to the Company or any other subsidiary of the
Company.
<PAGE>
12
(qq) Neither the Company nor any of its 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
its
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.
(rr) The operations of the Company and its 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 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 its 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.
(ss) Neither the Company nor any of its subsidiaries nor, to
the
knowledge
of the Company, any director, officer, agent, employee or
affiliate
of the Company or any of its 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.
(tt) Each Preliminary Prospectus, the Prospectus and each
Issuer
Free
Writing Prospectus comply, and any further amendments or
supplements
thereto
will comply, in all material respects, with any applicable laws
or
regulations of foreign jurisdictions in which such Preliminary
Prospectus,
Prospectus
or such Issuer Free Writing Prospectus, as amended or
supplemented, if applicable, are distributed in connection with
the
Directed
Share Program described in Section 3. No consent, approval,
authorization or order of, or filing or registration with, any
court or
governmental agency or body, other than such as have been obtained,
is
required
under the securities laws and regulations of any foreign
jurisdiction in which the Directed Shares are offered or sold
outside the
United
States.
(uu) The Company has not offered, or caused Lehman Brothers Inc.
to
offer,
Stock to any person pursuant to the Directed Share Program with
the
specific
intent to unlawfully influence (i) a customer or supplier of
the
Company to
alter the customer's or supplier's level or type of business
with the
Company or (ii) a trade journalist or
<PAGE>
13
publication to write or publish favorable information about the
Company,
its
business or its products.
(vv) The Company has not distributed and, prior to the later to
occur of
any Delivery Date and completion of the distribution of the
Stock,
will not distribute any offering material in connection with
the
offering
and sale of the Stock other than any Preliminary Prospectus,
the
Prospectus, any Issuer Free Writing Prospectus to which the
Representatives have consented in accordance with Section 1(h) or
5(a)(vi)
and any
Issuer Free Writing Prospectus set forth on Schedule 3 hereto
and,
in
connection with the Directed Share Program described in Section 3,
the
enrollment
materials prepared by Lehman Brothers Inc.
(ww) The Company has not taken and will not take, directly or
indirectly, any action designed to or that has constituted or that
would
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 Stock.
(xx) The Stock has been approved for listing, subject to
official
notice of
issuance and evidence of satisfactory distribution, on the New
York Stock
Exchange.
Any certificate signed by any two officers of the Company and
delivered to the Representatives or counsel for the Underwriters in
connection
with the offering of the Stock shall be deemed a representation and
warranty by
the Company, as to matters covered thereby, to each
Underwriter.
2. Purchase of the Stock by the Underwriters. On the basis of
the
representations and warranties contained in, and subject to the
terms and
conditions of, this Agreement, the Company agrees to sell
10,000,000 shares of
the Firm Stock to the several Underwriters, and each of the
Underwriters,
severally and not jointly, agrees to purchase the number of shares
of the Firm
Stock set forth opposite that Underwriter's name in Schedule 1
hereto. The
respective purchase obligations of the Underwriters with respect to
the Firm
Stock shall be rounded among the Underwriters to avoid fractional
shares, as the
Representatives may determine.
In addition, the Company grants to the Underwriters an option
to
purchase up to 1,500,000 additional shares of Option Stock. Such
option is
exercisable in the event that the Underwriters sell more shares of
Common Stock
than the number of shares of Firm Stock in the offering and as set
forth in
Section 4 hereof. Each Underwriter agrees, severally and not
jointly, to
purchase the number of shares of Option Stock (subject to such
adjustments to
eliminate fractional shares as the Representatives may determine)
that bears the
same proportion to the total number of shares of Option Stock to be
sold on such
Delivery Date as the number of shares of Firm Stock set forth in
Schedule 1
hereto opposite the name of such Underwriter bears to the total
number of shares
of Firm Stock.
The price of both the Firm Stock and any Option Stock purchased
by
the Underwriters shall be $- per share.
<PAGE>
14
The Company shall not be obligated to deliver any of the Firm
Stock
or Option Stock to be delivered on the applicable Delivery Date,
except upon
payment for all such Stock to be purchased on such Delivery Date as
provided
herein.
3. Offering of Stock by the Underwriters. Upon authorization by
the
Representatives of the release of the Firm Stock, the several
Underwriters
propose to offer the Firm Stock for sale upon the terms and
conditions to be set
forth in the Prospectus.
It is understood that approximately 500,000 shares of the Firm
Stock
(the "DIRECTED SHARES") will initially be reserved by the several
Underwriters
for offer and sale upon the terms and conditions to be set forth in
the
Prospectus and in accordance with the rules and regulations of the
NASD to
employees of the Company and its subsidiaries and persons having
business
relationships with the Company and its subsidiaries who have
heretofore
delivered to Lehman Brothers Inc. indications of interest to
purchase shares of
Firm Stock in form satisfactory to Lehman Brothers Inc. (such
program, the
"DIRECTED SHARE PROGRAM") and that any allocation of such Firm
Stock among such
persons will be made in accordance with timely directions received
by Lehman
Brothers Inc. from the Company; provided that under no
circumstances will Lehman
Brothers Inc. or any Underwriter be liable to the Company or to any
such person
for any action taken or omitted in good faith in connection with
such Directed
Share Program. It is further understood that any Directed Shares
not
affirmatively reconfirmed for purchase by any participant in the
Directed Share
Program by 10:00 A.M., New York City time, on the date hereof or
otherwise not
purchased by such persons will be offered by the Underwriters to
the public upon
the terms and conditions set forth in the Prospectus.
The Company agrees to pay all reasonable fees and disbursements
incurred by the Underwriters in connection with the Directed Share
Program and
any stamp duties or other taxes incurred by the Underwriters in
connection with
the Directed Share Program.
4. Delivery of and Payment for the Stock. Delivery of and
payment
for the Firm Stock shall be made at 10:00 A.M., New York City time,
on the third
full business day following the date of this Agreement or at such
other date or
place as shall be determined by agreement between the
Representatives and the
Company. This date and time are sometimes referred to as the
"INITIAL DELIVERY
DATE." Delivery of the Firm Stock shall be made to the
Representatives for the
account of each Underwriter against payment by the several
Underwriters through
the Representatives and of the respective aggregate purchase prices
of the Firm
Stock being sold by the Company to or upon the order of the Company
of the
purchase price by wire transfer in immediately available funds to
the accounts
specified by the Company. Time shall be of the essence, and
delivery at the time
and place specified pursuant to this Agreement is a further
condition of the
obligation of each Underwriter hereunder. The Company shall deliver
the Firm
Stock through the facilities of The Depository Trust Company
("DTC") unless the
Representatives shall otherwise instruct.
The option granted in Section 2 will expire 30 days after the
date
of this Agreement and may be exercised in whole or from time to
time in part by
written notice being given to the Company by the Representatives;
provided that
if such date falls on a day that is not a business day, the option
granted in
Section 2 will expire on the next succeeding business day. Such
notice shall set
forth the aggregate number of shares of Option Stock as to which
the option
<PAGE>
15
is being exercised, the names in which the shares of Option Stock
are to be
registered, the denominations in which the shares of Option Stock
are to be
issued and the date and time, as determined by the Representatives,
when the
shares of Option Stock are to be delivered; provided, however, that
this date
and time shall not be earlier than the Initial Delivery Date nor
earlier than
the second business day after the date on which the option shall
have been
exercised nor later than the fifth business day after the date on
which the
option shall have been exercised. Each date and time the shares of
Option Stock
are delivered is sometimes referred to as an "OPTION STOCK DELIVERY
DATE," and
the Initial Delivery Date and any Option Stock Delivery Date are
sometimes each
referred to as a "DELIVERY DATE."
Delivery of the Option
Stock by the Company and payment for the
Option Stock by the several Underwriters through the
Representatives shall be
made at 10:00 A.M., New York City time, on the date specified in
the
corresponding notice described in the preceding paragraph or at
such other date
or place as shall be determined by agreement between the
Representatives and the
Company. On the Option Stock Delivery Date, the Company shall
deliver or cause
to be delivered the Option Stock to the Representatives for the
account of each
Underwriter against payment by the several Underwriters through
the
Representatives and of the respective aggregate purchase prices of
the Option
Stock being sold by the Company to or upon the order of the Company
of the
purchase price by wire transfer in immediately available funds to
the accounts
specified by the Company. Time shall be of the essence, and
delivery at the time
and place specified pursuant to this Agreement is a further
condition of the
obligation of each Underwriter hereunder. The Company shall deliver
the Option
Stock through the facilities of DTC unless the Representatives
shall otherwise
instruct.
5. Further Agreements of the Company and the Underwriters. (a)
The
Company agrees:
(i) To prepare the Prospectus in a form approved by the
Representatives 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 supplement to the
Registration Statement or the Prospectus prior to the last Delivery
Date
except as
provided herein; to advise the Representatives, 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
the Representatives with copies thereof; to advise the
Representatives, 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 Stock
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 reasonable best efforts to
obtain its
withdrawal;
<PAGE>
16
(ii) To furnish promptly to each of the Representatives 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;
(iii) To deliver promptly to the Representatives such number of
the
following
documents as the Representatives 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 and (C) each Issuer Free Writing
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 Stock 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 the Representatives and,
upon
their
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 the
Representatives may from time to time reasonably request of an
amended or
supplemented Prospectus that will correct such statement or
omission
or effect such compliance;
(iv) 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 the Representatives, be required by
the
Securities
Act or requested by the Commission;
(v) Prior to filing with the Commission any amendment or
supplement
to the
Registration Statement or the Prospectus, to furnish a copy
thereof
to the
Representatives and counsel for the Underwriters and obtain the
consent of
the Representatives to the filing;
(vi) Not to make any offer relating to the Stock that would
constitute
an Issuer Free Writing Prospectus without the prior written
consent of
the Representatives;
(vii) To retain in accordance with the Rules and Regulations
all
Issuer
Free Writing Prospectuses not required to be filed pursuant to
the
Rules and
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 the
Representatives and, upon their request, to file such document
and to
prepare and furnish without charge to eac
