Exhibit 1.1
Everest Re Group,
Ltd.
Common Shares
Underwriting
Agreement
December 1, 2005
To the Underwriters named in the
respective
Pricing Agreements hereinafter
described.
Ladies and Gentlemen:
From time to time Everest Re Group,
Ltd., a Bermuda company (the “Company”), and Everest
Reinsurance Holdings, Inc., a Delaware corporation (the
“Selling Stockholder”), propose to enter into one or
more Pricing Agreements (each a “Pricing Agreement”) in
the form of Annex I hereto, with such additions and deletions as
the parties thereto may determine, and, subject to the terms and
conditions stated herein and therein, which shall provide that the
Company shall issue and sell, and the Selling Stockholder shall
deliver and sell, to the firm(s) named in Schedule I to the
applicable Pricing Agreement (such firm(s) constituting the
“Underwriters” with respect to such Pricing Agreement
and the securities specified therein) certain of the
Company’s common shares, par value $0.01 per share (the
“Shares”), specified in Schedule I to such Pricing
Agreement (with respect to such Pricing Agreement, the “Firm
Shares”), upon the terms and conditions set forth in Schedule
II to such Pricing Agreement. If specified in such Pricing
Agreement, the Company may grant to the Underwriters the right to
purchase at their election an additional number of Shares as
provided in Section 3 hereof (the “Optional
Shares”). The Firm Shares and the Optional Shares, if any,
which the Underwriters elect to purchase pursuant to Section 3
hereof are herein collectively called the “Designated
Shares”.
1. Particular sales of Designated
Shares may be made from time to time to the Underwriters of such
Shares, for whom the firm(s) designated as representative(s) of the
Underwriters of such Shares in the Pricing Agreement relating
thereto will act as representative(s) (the
“Representatives”), if any. The term
“Representatives” also refers to a single firm acting
as sole representative of the Underwriters and to an Underwriter or
Underwriters who act on its or their own behalf without any firm
being designated as its or their representatives. This
Underwriting Agreement shall not be construed as
an obligation of the Company or the Selling Stockholder to sell any
of the Shares or as an obligation of any of the Underwriters to
purchase any of the Shares. The obligation of the Company to issue
and sell any of the Shares, the obligation of the Selling
Stockholder to deliver and sell any of the Shares and the
obligation of any of the Underwriters to purchase any of the Shares
shall be evidenced by the Pricing Agreement with respect to the
Designated Shares specified therein. Each Pricing Agreement shall
specify the aggregate number of the Firm Shares (and the number of
such Firm Shares to be delivered and sold by the Selling
Stockholder), the maximum number of Optional Shares, if any, the
initial public offering price of such Firm Shares and Optional
Shares or the manner of determining such price, the purchase price
to the Underwriters of such Designated Shares, the names of the
Underwriters of such Designated Shares, the names of the
Representatives of such Underwriters, the number of such Designated
Shares to be purchased by each Underwriter and the commission, if
any, payable to the Underwriters with respect thereto and shall set
forth the date, time and manner of delivery of such Firm Shares and
Optional Shares, if any, and payment therefor. The Pricing
Agreement shall also specify (to the extent not set forth in the
registration statement and prospectus with respect thereto) the
terms of such Designated Shares. A Pricing Agreement shall be in
the form of an executed writing (which may be in counterparts), and
may be evidenced by an exchange of telegraphic communications or
any other rapid transmission device designed to produce a written
record of communications transmitted. If there is more than one
Underwriter, the obligations of such Underwriters under this
Agreement and each Pricing Agreement shall be several and not
joint.
2. (A) The Company represents
and warrants to, and agrees with, each of the Underwriters
that:
(a) An “automatic shelf
registration statement” as defined under Rule 405 under the
Securities Act of 1933, as amended (the “Act”), on Form
S-3 (File No. 333-130044) in respect of the Shares and other
securities (the “Securities”) has been filed with the
Securities and Exchange Commission (the “Commission”)
not earlier than three years prior to the date hereof; such
registration statement, and any post-effective amendment thereto,
became effective on filing; and no stop order suspending the
effectiveness of such registration statement or any part thereof
has been issued and no proceeding for that purpose has been
initiated or, to the best of the Company’s knowledge,
threatened by the Commission, and no notice of objection of the
Commission to the use of such registration statement or any
post-effective amendment thereto pursuant to Rule 401(g)(2) under
the Act has been received by the Company (the base prospectus filed
as part of such registration statement, in the form in which it has
most recently been filed with the Commission on or prior to the
date of this Agreement, is hereinafter called the “Basic
Prospectus”; any preliminary prospectus (including any
preliminary prospectus supplement) relating to the Securities filed
with the Commission pursuant to Rule 424(b) under the Act is
hereinafter called a “Preliminary Prospectus”; the
various parts of such registration statement, including all
exhibits thereto but excluding Form T-1 and including any
prospectus supplement relating to the Securities that is filed with
the Commission and deemed by virtue of Rule 430B to be part of such
registration statement, each as amended at the time such part of
the registration statement became effective, are hereinafter
collectively called the “Registration Statement”; the
Basic Prospectus, as amended and supplemented immediately prior to
the Applicable Time (as defined in Section 2(A)(c)
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hereof), is hereinafter called the
“Pricing Prospectus”; the form of the final prospectus
relating to the Designated Shares filed with the Commission
pursuant to Rule 424(b) under the Act in accordance with
Section 5(a) hereof is hereinafter called the
“Prospectus”; any reference herein to the Basic
Prospectus, the Pricing Prospectus, any Preliminary Prospectus or
the Prospectus shall be deemed to refer to and include the
documents incorporated by reference therein pursuant to
Item 12 of Form S-3 under the Act, as of the date of such
prospectus; any reference to any amendment or supplement to the
Basic Prospectus, any Preliminary Prospectus or the Prospectus
shall be deemed to refer to and include any post-effective
amendment to the Registration Statement, any prospectus supplement
relating to the Securities filed with the Commission pursuant to
Rule 424(b) under the Act and any documents filed under the
Securities Exchange Act of 1934, as amended (the “Exchange
Act”), and incorporated therein, in each case after the date
of the Basic Prospectus, such Preliminary Prospectus, or the
Prospectus, as the case may be; any reference to any amendment to
the Registration Statement shall be deemed to refer to and include
any annual report of the Company filed pursuant to
Section 13(a) or 15(d) of the Exchange Act after the effective
date of the Registration Statement that is incorporated by
reference in the Registration Statement; and any “issuer free
writing prospectus” as defined in Rule 433 under the Act
relating to the Securities is hereinafter called an “Issuer
Free Writing Prospectus”);
(b) No order preventing or
suspending the use of any Preliminary Prospectus or any Issuer Free
Writing Prospectus has been issued by the Commission, and each
Preliminary Prospectus, at the time of filing thereof, conformed in
all material respects to the requirements of the Act and the rules
and regulations of the Commission thereunder, and 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; provided, however, that this
representation and warranty shall not apply to any statements or
omissions made in reliance upon and in conformity with information
furnished in writing to the Company by an Underwriter through the
Representatives expressly for use therein;
(c) For the purposes of this
Agreement, the “Applicable Time” is 4:05 p.m. (Eastern
time) on the date of this Agreement. The Pricing Prospectus, as of
the Applicable Time, did not include any 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; and each Issuer Free
Writing Prospectus listed on Schedule III to the applicable
Pricing Agreement does not conflict with the information contained
in the Registration Statement, the Pricing Prospectus or the
Prospectus and each such Issuer Free Writing Prospectus, as
supplemented by and taken together with the Pricing Prospectus as
of the Applicable Time, did not include any 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; provided, however, that
this representation and warranty shall not apply to statements or
omissions made in an Issuer Free Writing Prospectus in reliance
upon and in conformity with information furnished in writing to the
Company by an Underwriter through the Representatives expressly for
use therein;
(d) The documents incorporated by
reference in the Pricing Prospectus and the Prospectus, when they
became effective or were filed with the Commission, as the
case
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may be, conformed in all material
respects to the requirements of the Act or the Exchange Act, as
applicable, and the rules and regulations of the Commission
thereunder, and none of such documents contained an untrue
statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading; any further documents so filed and
incorporated by reference in the Prospectus or any further
amendment or supplement thereto, when such documents become
effective or are filed with the Commission, as the case may be,
will conform in all material respects to the requirements of the
Act or the Exchange Act, as applicable, and the rules and
regulations of the Commission thereunder and will 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 not misleading; provided , however
, that this representation and warranty shall not apply to any
statements or omissions made in reliance upon and in conformity
with information furnished in writing to the Company by any
Underwriter of Designated Shares through the Representatives
expressly for use in the Pricing Prospectus or the Prospectus as
amended or supplemented relating to such Shares; and no such
documents were filed with the Commission since the
Commission’s close of business on the business day
immediately prior to the date of this Agreement and prior to the
execution of this Agreement;
(e) The Registration Statement and
the Prospectus conform, and any further amendments or supplements
to the Registration Statement or the Prospectus will conform, in
all material respects to the requirements of the Act and the rules
and regulations of the Commission thereunder and do not and will
not, as of the applicable effective date as to the Registration
Statement and any amendment thereto and as of the applicable filing
date as to the Prospectus and any amendment or supplement thereto,
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 ,
however , that this representation and warranty shall not
apply to any statements or omissions made in reliance upon and in
conformity with information furnished in writing to the Company by
any Underwriter of Designated Shares through the Representatives
expressly for use in the Prospectus as amended or supplemented
relating to the Designated Shares;
(f) Neither the Company nor any of
its subsidiaries has sustained since the date of the latest audited
financial statements included or incorporated by reference in the
Pricing Prospectus any material loss or material 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 material to the Company and
its subsidiaries taken as a whole, otherwise than as set forth or
contemplated in the Pricing Prospectus; and, since the respective
dates as of which information is given in the Registration
Statement and the Pricing Prospectus, there has not been any
material change in the capital stock or any material change in the
long-term debt of the Company or any of its subsidiaries or any
material adverse change, or any development involving a prospective
material adverse change, in or affecting the general affairs,
management, financial position, shareholders’ equity or
results of operations of the Company and its subsidiaries,
otherwise than as set forth or contemplated in the Pricing
Prospectus;
(g) The Company and each of its
subsidiaries have been duly incorporated and are validly existing
as corporations in good standing (to the extent such concept
is
4
relevant) under the laws of the
jurisdiction of its incorporation, with corporate power and
authority to own their respective properties and conduct their
respective businesses as described in the Prospectus, and each of
them has been duly qualified as a foreign corporation for the
transaction of business and is in good standing (to the extent such
concept is relevant) under the laws of each other jurisdiction in
which it owns or leases properties or conducts any business so as
to require such qualification, except where the failure to be so
qualified would not have a material adverse effect on the
consolidated financial position, shareholders’ equity or
results of operations of the Company and its subsidiaries taken as
a whole (a “Material Adverse Effect”); the Company has
full corporate power and authority to enter into this Agreement and
the Pricing Agreement and to carry out all the terms and provisions
hereof and thereof to be carried out by it; and this Agreement and
the Pricing Agreement have been duly authorized, executed and
delivered by the Company;
(h) The Company has an authorized
capitalization as set forth in the Pricing Prospectus, and all of
the issued and outstanding shares of capital stock of the Company
have been duly and validly authorized and issued and are fully paid
and non-assessable;
(i) The Shares have been duly and
validly authorized, and in the case of the Designated Shares to be
delivered and sold by the Selling Stockholder, are fully paid and
non-assessable; when the Designated Shares to be sold by the
Company are issued and delivered pursuant to this Agreement and the
Pricing Agreement with respect to such Designated Shares and, in
the case of any Optional Shares, pursuant to Over-allotment Options
(as defined in Section 3 hereof) with respect to such Optional
Shares, such Designated Shares will be duly and validly issued and
fully paid and non-assessable; the Shares conform to the
description thereof contained in the Registration Statement and the
Designated Shares will conform to the description thereof contained
in the Prospectus as amended or supplemented with respect to such
Designated Shares;
(j) The issue and sale of the Shares
and the compliance by the Company with all of the provisions of
this Agreement, any Pricing Agreement and each Over-allotment
Option, if any, and the consummation of the transactions herein and
therein contemplated will not conflict with or result in a breach
or violation of any of the terms or provisions of, or constitute a
default under, any indenture, mortgage, deed of trust, loan
agreement or other material 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, except for such conflicts, breaches, violations or
defaults as would not, individually or in the aggregate, have a
Material Adverse Effect or a material adverse effect on the
consummation by the Company of the transactions contemplated by
this Agreement or the Pricing Agreement, nor will such action
result in any violation of the provisions of (A) the
Memorandum of Association or Bye-Laws of the Company or the
organizational documents of any of its subsidiaries or (B) any
statute or any order, rule or regulation of any court or
governmental agency or body (including, without limitation, any
insurance regulatory agency or body) having jurisdiction over the
Company or any of its subsidiaries or any of their properties,
except, in the case of this clause (B), for any such violation
which, individually or in the aggregate, would not have a Material
Adverse Effect; and no consent, approval, authorization, order,
registration or qualification of or with any such court or
governmental
5
agency or body is required for the
issue and sale of the Shares or the consummation by the Company of
the transactions contemplated by this Agreement or any Pricing
Agreement or any Over-allotment Option, except such as have been,
or will have been prior to the Time of Delivery (as defined in
Section 4 hereof), obtained under the Act and such consents,
approvals, authorizations, registrations or qualifications as may
be required under state securities or Blue Sky laws in connection
with the purchase and distribution of the Shares by the
Underwriters;
(k) The statements set forth
(A) in the Pricing Prospectus under the caption
“Description of Our Capital Stock”, insofar as they
purport to constitute a summary of the terms of the Shares, are
accurate and complete in all material respects; and (B) in the
Prospectus under the captions “Material Tax
Considerations” and “Underwriting”, insofar as
they purport to describe the provisions of the laws and documents
referred to therein, will be accurate and complete in all material
respects;
(l) Neither the Company nor any of
its subsidiaries is in violation of its Memorandum of Association
or Bye-Laws or other organizational documents, as applicable, or in
default in the performance or observance of any material
obligation, agreement, covenant or condition contained in any
indenture, mortgage, deed of trust, loan agreement, lease or other
material agreement or instrument to which it is a party or by which
it or any of its properties may be bound, except for such as
individually or in the aggregate would not have a Material Adverse
Effect;
(m) Other than as set forth in the
Pricing Prospectus, 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 of the Company or any of its subsidiaries
is the subject, which, individually or in the aggregate might
reasonably be expected to result in a Material Adverse Effect; and,
to the best of the Company’s knowledge, no such proceedings
are threatened or contemplated by governmental authorities or
threatened by others;
(n) Other than as set forth in the
Prospectus, all dividends and other distributions declared and
payable on the shares of capital stock of the Company will not be
subject to withholding or other taxes under the laws and
regulations of Bermuda and are otherwise free and clear of any
other tax, withholding or deduction in Bermuda and without the
necessity of obtaining any consent, approval, authorization, order,
registration, clearance and qualification of or with any court or
governmental agency or body having jurisdiction over the Company or
any of its significant subsidiaries (as defined in Rule 1-02(w) of
Regulation S-X) or any of their properties or any stock exchange
authorities in Bermuda;
(o) The Company is not and, after
giving effect to the offering and sale of the Shares, will not be
an “investment company”, as such term is defined in the
Investment Company Act of 1940, as amended (the “Investment
Company Act”);
(p) (A) (i) At the time of
filing the Registration Statement, (ii) at the time of the
most recent amendment thereto for the purposes of complying with
Section 10(a)(3) of the Act (whether such amendment was by
post-effective amendment, incorporated report filed pursuant to
Section 13 or 15(d) of the Exchange Act or form of
prospectus), and (iii) at the time the Company or any person
acting on its behalf (within the meaning, for this clause only, of
Rule 163(c) under the Act) made any offer relating to the
Securities in reliance on the exemption of Rule 163 under the Act,
the Company was a “well-known seasoned issuer”
as
6
defined in Rule 405 under the Act;
and (B) at the earliest time after the filing of the
Registration Statement that the Company or another offering
participant made a bona fide offer (within the meaning of Rule
164(h)(2) under the Act) of the Securities, the Company was not an
“ineligible issuer” as defined in Rule 405 under the
Act;
(q) The Company is not a Passive
Foreign Investment Company (“PFIC”) within the meaning
of Section 1297 of the United States Internal Revenue Code of
1986, as amended, and, assuming it conducts its business as
described in the Prospectus, does not expect to become a PFIC. The
Company has no current plans to conduct its business in a manner
that would cause it to become a PFIC;
(r) No stamp or other issuance or
transfer taxes or duties and no capital gains, income, withholding
or other taxes are payable by or on behalf of the Underwriters to
Bermuda or any political subdivision or taxing authority thereof or
therein in connection with (A) the sale and delivery by the
Company of the Shares to or for the respective accounts of the
Underwriters or (B) the sale and delivery outside Bermuda by
the Underwriters of the Shares to the initial purchasers
thereof;
(s) Neither the Company nor any of
its subsidiaries has taken, directly or indirectly, any action
which was designed to or which has constituted or which might
reasonably be expected to cause or result in stabilization or
manipulation of the price of any security of the Company to
facilitate the sale or resale of the Shares;
(t) PricewaterhouseCoopers LLP, who
have certified certain financial statements of the Company and its
subsidiaries, and of Everest Reinsurance Holdings, Inc., a Delaware
corporation (“Holdings”), and have audited each of the
Company’s and Holdings’ internal control over financial
reporting and management’s assessment thereof are independent
public accountants as required by the Act and the rules and
regulations of the Commission thereunder;
(u) The Company maintains a system
of internal control over financial reporting (as such term is
defined in Rule 13a-15(f) of the Exchange Act) that complies with
the requirements of the Exchange Act and has been designed by the
Company’s principal executive officer and principal financial
officer, or under their supervision, to provide reasonable
assurance regarding the reliability of financial reporting and the
preparation of financial statements for external purposes in
accordance with generally accepted accounting principles. The
Company’s internal control over financial reporting is
effective and the Company is not aware of any material weaknesses
in its internal control over financial reporting;
(v) Since the date of the latest
audited financial statements included or incorporated by reference
in the Pricing Prospectus, there has been no change in the
Company’s internal control over financial reporting that has
materially affected, or is reasonably likely to materially affect,
the Company’s internal control over financial
reporting;
(w) The Company maintains disclosure
controls and procedures (as such term is defined in Rule 13a-15(e)
of the Exchange Act) that comply with the requirements of the
Exchange Act; such disclosure controls and procedures have been
designed to ensure that material information relating to the
Company and its subsidiaries is made known to the Company’s
principal executive officer and principal financial officer by
others within those entities; such disclosure controls and
procedures are effective;
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(x) The consolidated financial
statements and financial statement schedules of the Company and its
consolidated subsidiaries included in the Registration Statement
and the Pricing Prospectus fairly present in all material respects
the financial position of the Company and its consolidated
subsidiaries and the results of operations and changes in financial
condition and cash flows as of the dates and periods therein
specified. Such financial statements and financial statement
schedules have been prepared in accordance with generally accepted
accounting principles in the United States consistently applied
throughout the periods involved (except as otherwise noted
therein);
(y) Each of the Company and its
subsidiaries, when necessary, is duly licensed to conduct an
insurance or a reinsurance business, as the case may be, under the
insurance statutes of each jurisdiction in which the conduct of its
business requires such licensing, except for such jurisdictions in
which the failure of any of them to be so licensed would not,
individually or in the aggregate, have a Material Adverse Effect.
The Company and each of its subsidiaries have made all required
filings under applicable insurance holding company statutes in each
jurisdiction where such filings are required, except for such
jurisdictions in which the failure to make such filings would not,
individually or in the aggregate, have a Material Adverse Effect.
Each of the Company and its subsidiaries has all other necessary
authorizations, approvals, orders, consents, certificates, permits,
registrations and qualifications of and from all insurance
regulatory authorities necessary to conduct their respective
businesses as described in the Prospectus, except where the failure
to have such authorizations, approvals, orders, consents,
certificates, permits, registrations or qualifications would not,
individually or in the aggregate, have a Material Adverse Effect,
and neither the Company nor any of its subsidiaries has received
any notification from any insurance regulatory authority to the
effect that any additional authorization, approval, order, consent,
certificate, permit, registration or qualification needs to be
obtained by any of them, in any case, where it could be reasonably
expected that (x) any of them would be required either to
obtain such additional authorization, approval, order, consent,
certificate, permit, registration or qualification or to cease or
otherwise limit the writing of certain business and (y) the
failure to obtain such additional authorization, approval, order,
consent, certificate, permit, registration or qualification or the
limiting of the writing of such business would have a Material
Adverse Effect; and no insurance regulatory authority having
jurisdiction over the Company or any of its subsidiaries has issued
any order or decree impairing, restricting or prohibiting the
payment of dividends by or to any of them; and
(z) Each certificate signed by any
officer of the Company and delivered to the Representatives or
counsel for the Underwriters pursuant to this Agreement shall be
deemed to be a representation and warranty by the Company, and not
by such officer in an individual capacity, to each Underwriter as
to the matters covered thereby.
(B) The Selling Stockholder
represents and warrants to, and agrees with, each of the
Underwriters and the Company that:
(i) The Selling Stockholder has full
corporate power and authority to enter into this Agreement and the
Pricing Agreement and to carry out all the terms and provisions
hereof and thereof to be carried out by it; and this Agreement and
the Pricing Agreement have been duly authorized, executed and
delivered by the Selling Stockholder;
8
(ii) All consents, approvals,
authorizations and orders necessary for the execution and delivery
by the Selling Stockholder of this Agreement and the Pricing
Agreement, and for the sale and delivery of the Shares to be sold
by the Selling Stockholder hereunder and thereunder, have been
obtained; and the Selling Stockholder has full right, power and
authority to enter into this Agreement and the Pricing Agreement
and to sell, assign, transfer and deliver the Shares to be sold by
the Selling Stockholder hereunder and thereunder;
(iii) The delivery and sale of the
Shares to be delivered and sold by the Selling Stockholder and the
compliance by the Selling Stockholder with all of the provisions of
this Agreement, any Pricing Agreement and the consummation of the
transactions herein and therein contemplated will not conflict with
or result in a breach or violation of any of the terms or
provisions of, or constitute a default under, any indenture,
mortgage, deed of trust, loan agreement or other material agreement
or instrument to which the Selling Stockholder or any of its
subsidiaries is a party or by which the Selling Stockholder or any
of its subsidiaries is bound or to which any of the property or
assets of the Selling Stockholder or any of its subsidiaries is
subject, except for such conflicts, breaches, violations or
defaults as would not, individually or in the aggregate, have a
material adverse effect on the consummation by the Selling
Stockholder of the transactions contemplated by this Agreement or
the Pricing Agreement, nor will such action result in any violation
of the provisions of (A) the Certificate of Incorporation or
By-Laws of the Selling Stockholder or the organizational documents
of any of its subsidiaries or (B) any statute or any order,
rule or regulation of any court or governmental agency or body
(including, without limitation, any insurance regulatory agency or
body) having jurisdiction over the Selling Stockholder or any of
its subsidiaries or any of their properties; except, in the case of
clause (B), for any violation which, individually or in the
aggregate, would not have a material adverse effect on the
consummation by the Selling Stockholder of the transactions
contemplated by this Agreement or the Pricing Agreement; and no
consent, approval, authorization, order, registration or
qualification of or with any such court or governmental agency or
body is required for the delivery and sale of the Shares to be sold
by the Selling Stockholder or the consummation by the Selling
Stockholder of the transactions contemplated by this Agreement or
any Pricing Agreement, except such as have been, or will have been
prior to the Time of Delivery, obtained under the Act and such
consents, approvals, authorizations, registrations or
qualifications as may be required under state securities or Blue
Sky laws in connection with the purchase and distribution of the
Shares by the Underwriters;
(iv) The Selling Stockholder has,
and immediately prior to each Time of Delivery the Selling
Stockholder will have, good and valid title to the Shares to be
sold by the Selling Stockholder hereunder, free and clear of all
liens, encumbrances, equities or claims; and, upon delivery of such
Shares and payment therefor pursuant hereto, good and valid title
to such Shares, free and clear of all liens, encumbrances, equities
or claims, will pass to the several Underwriters;
(v) During the period beginning from
the date hereof and continuing to and including the date 45 days
after the date of the Pricing Prospectus, not to offer, sell
contract to sell or otherwise dispose of, except as provided
hereunder, any securities of the Company that are substantially
similar to the Shares, including but not limited to any securities
that are
9
convertible into or exchangeable
for, or that represent the right to receive, Shares or any such
substantially similar securities (other than pursuant to employee
stock option plans existing on, or upon the conversion or exchange
of convertible or exchangeable securities outstanding as of, the
date of this Agreement), without your prior written
consent;
(vi) The Selling Stockholder has not
taken and will not take, directly or indirectly, any action which
is designed to or which has constituted or which might reasonably
be expected to cause or result in stabilization or manipulation of
the price of any security of the Company to facilitate the sale or
resale of the Shares;
(vii) In order to document the
Underwriters’ compliance with the reporting and withholding
provisions of the Tax Equity and Fiscal Responsibility Act of 1982
with respect to the transactions herein contemplated, the Selling
Stockholder will deliver to you prior to or at the Time of Delivery
(as hereinafter defined) a properly completed and executed United
States Treasury Department Form W-9 (or other applicable form or
statement specified by Treasury Department regulations in lieu
thereof);
(viii) As of the date hereof, the
date of the Pricing Agreement and immediately prior to the Time of
Delivery, the Selling Stockholder is the holder of a securities
entitlement (as defined in the Uniform Commercial Code) to the
Shares to be delivered and sold by it at the Time of Delivery. The
Selling Stockholder will give an entitlement order (as defined in
the Uniform Commercial Code) to the securities intermediary (as
defined in the Uniform Commercial Code) in respect of such Shares
to transfer at the Time of Delivery the securities entitlement in
respect thereof to the accounts of the Underwriters with The
Depositary Trust Company (“DTC”) or its agent and the
crediting of such Shares to the Underwriters’ accounts with
DTC, Cede & Co. or such other nominee designated by DTC
will be a “protected purchaser” of the Shares (as
defined in Section 8-303 of the Uniform Commercial Code), the
Underwriters will acquire a valid security entitlement to the
Shares, and no action based on an “adverse claim” (as
defined in Section 8-102 of the Uniform Commercial Code) may
be asserted against the Underwriters with respect to such security
entitlement (assuming that the Underwriters are without notice of
such adverse claim); and
(ix) The securities entitlement
referred to above to be delivered to the Representatives, and the
Shares represented thereby, are subject to the interests of the
Underwriters hereunder and the obligations of the Selling
Stockholder hereunder shall not be terminated by operation of law,
whether by dissolution or by the occurrence of any other
event.
3. Upon the execution of the Pricing
Agreement applicable to any Designated Shares and authorization by
the Representatives of the release of the Firm Shares, the several
Underwriters propose to offer the Firm Shares for sale upon the
terms and conditions set forth in the Prospectus as amended or
supplemented.
The Company may specify in the
Pricing Agreement applicable to any Designated Shares that the
Company thereby grants to the Underwriters the right (an
“Over-allotment Option”) to purchase at their election
up to the number of Optional Shares set forth in such Pricing
Agreement, on the terms set forth in the Prospectus as amended or
supplemented, for the sole purpose of covering over-allotments in
the sale of the Firm Shares. Any such election to purchase Optional
Shares may be exercised by written notice from the Representatives
to the Company,
10
given within a period specified in the Pricing
Agreement, setting forth the aggregate number of Optional Shares to
be purchased and the date on which such Optional Shares are to be
delivered, as determined by the Representatives but in no event
earlier than the First Time of Delivery (as defined in
Section 4 hereof) or, unless the Representatives and the
Company otherwise agree in writing, earlier than or later than the
respective number of business days after the date of such notice
set forth in such Pricing Agreement.
The number of Optional Shares, if
any, to be added to the number of Firm Shares to be purchased by
each Underwriter (as set forth in Schedule I to the applicable
Pricing Agreement) shall be, in each case, the number of Optional
Shares set forth in the applicable Pricing Agreement; provided
that , if such number of Optional Shares is not set forth in
the applicable Pricing Agreement, the number of Optional Shares to
be so added shall be, in each case, that proportion of Optional
Shares which the number of Firm Shares to be purchased by such
Underwriter under such Pricing Agreement bears to the aggregate
number of Firm Shares (rounded as the Representatives may determine
to the nearest 100 shares). The total number of Designated Shares
to be purchased by all the Underwriters pursuant to such Pricing
Agreement shall be the aggregate number of Firm Shares set forth in
Schedule I to such Pricing Agreement plus the aggregate number of
Optional Shares which the Underwriters elect to purchase pursuant
to such Pricing Agreement.
4. Certificates for the Firm Shares
and the Optional Shares, if any, to be purchased by each
Underwriter pursuant to the Pricing Agreement relating thereto, in
definitive form and in such authorized denominations and registered
in such names as the Representatives may request upon at least 48
hours’ prior notice to the Company and the Selling
Stockholder, shall be delivered by or on behalf of the Company and
the Selling Stockholder to the Representatives for the account of
each such Underwriter, against payment by each such Underwriter or
on its behalf of the purchase price therefor by wire transfer of
Federal (same-day) funds to the accounts specified by the Company
and the Selling Stockholder, as applicable, to the Representatives
at least forty-eight hours in advance of the Time of Delivery (as
defined in this Section 4) as specified in such Pricing
Agreement, (i) with respect to the Firm Shares, all in the
manner and at the place and time and date specified in such Pricing
Agreement or at such other place and time and date as the
Representatives and the Company may agree upon in writing, such
time and date being herein called the “First Time of
Delivery” and (ii) with respect to the Optional Shares,
if any, in the manner and at the time and date specified by the
Representatives in the written notice given by the Representatives
of the Underwriters’ election to purchase such Optional
Shares, or at such other time and date as the Representatives and
the Company may agree upon in writing, such time and date, if not
the First Time of Delivery, herein called the “Second Time of
Delivery”. Each such time and date for delivery is herein
called a “Time of Delivery”.
5. The Company agrees with each of
the Underwriters of any Designated Shares:
(a) To prepare the Prospectus as
amended or supplemented in relation to the applicable Designated
Shares in a form approved by the Representatives and to file such
Prospectus pursuant to Rule 424(b) under the Act not later than the
Commission’s close of business on the second business day
following the execution and delivery of the Pricing Agreement
relating to the applicable Designated Shares or, if applicable,
such earlier time as may be required by Rule 424(b); to make no
further amendment or any supplement to
11
the Registration Statement or
Prospectus as amended or supplemented after the date of the Pricing
Agreement relating to such Shares and prior to the Time of Delivery
for such Shares which shall be disapproved by the Representatives
for such Shares promptly after reasonable notice thereof; to advise
the Representatives promptly of any such amendment or supplement
after such Time of Delivery and furnish the Representatives with
copies thereof; to file promptly all reports and any definitive
proxy or information statements required to be filed by the Company
with the Commission pursuant to Sections 13(a), 13(c), 14 or 15(d)
of the Exchange Act for so long as the delivery of a prospectus (or
in lieu thereof, the notice referred to in Rule 173(a) under the
Act) is required in connection with the offering or sale of such
Shares, and during such same period to advise the Representatives,
promptly after it receives notice thereof, of the time when any
amendment to the Registration Statement has been filed or becomes
effective or any supplement to the Prospectus or any amended
Prospectus has been filed with the Commission, of the issuance by
the Commission of any stop order or of any order preventing or
suspending the use of any prospectus relating to the Shares, of any
notice of objection of the Commission to the use of the
Registration Statement or any post-effective amendment thereto
pursuant to Rule 401(g)(2) under the Act, of the suspension of the
qualification of such Shares for offering or sale in any
jurisdiction, of the initiation or threatening of any proceeding
for any such purpose, or of any request by the Commission for the
amending or supplementing of the Registration Statement or
Prospectus or for additional information; and, in the event of the
issuance of any such stop order or of any such order preventing or
suspending the use of any prospectus relating to the Shares or
suspending any such qualification, to promptly use its best efforts
to obtain the withdrawal of such order;
(b) If required by Rule 430B(h)
under the Act, to prepare a form of prospectus in a form approved
by you and to file such form of prospectus pursuant to Rule 424(b)
under the Act not later than may be required by Rule 424(b) under
the Act; and to make no further amendment or supplement to such
form of prospectus which shall be disapproved by you promptly after
reasonable notice therereof;
(c) Promptly from time to time to
take such action as the Representatives may reasonably request to
qualify such Shares for offering and sale under the securities laws
of such jurisdictions in the United States as the Representatives
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 such
Shares, provided that in connection therewith the Company shall not
be required to qualify as a foreign corporation or as a dealer in
securities or to file a general consent to service of process in
any jurisdiction or to subject itself to taxation in respect of
doing business in any jurisdiction in which it is not otherwise
subject;
(d) Prior to 10:00 A.M., New York
City time, on the second New York Business Day (as defined in
Section 17 hereof) next succeeding the date of this Agreement
and from time to time, to furnish the Underwriters with written and
electronic copies of the Prospectus as amended or supplemented in
New York City in such quantities as the Representatives may
reasonably request, and, if the delivery of a prospectus (or in
lieu thereof, the notice referred to in Rule 173(a) under the Act)
is required at any time in connection with the offering or sale of
the Shares and if at such time any event shall have
12
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
(or in lieu thereof, the notice referred to in Rule 173(a) under
the Act) is delivered, not misleading, or, if for any other reason
it shall be necessary during such same period to amend or
supplement the Prospectus or to file under the Exchange Act any
document incorporated by reference in the Prospectus in order to
comply with the Act or the Exchange 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 written and electronic copies as the
Representatives may from time to time reasonably request of an
amended Prospectus or a supplement to the Prospectus which will
correct such statement or omission or effect such compliance,
provided that any such amended Prospectus or supplement to the
Prospectus required to be delivered (or in lieu thereof, the notice
referred to in Rule 173(a) under the Act) following the expiration
of nine months after the time of issue of the Prospectus shall be
prepared and furnished at the expense of the
Underwriters;
(e) To make generally available to
its securityholders as soon as practicable, but in any event not
later than eighteen months after the effective date of the
Registration Statement, an earnings statement (as defined in Rule
158(c) under the Act) of the Company and its subsidiaries (which
need not be audited) complying with Section 11(a) of the Act
and the rules and regulations of the Commission thereunder
(including, at the option of the Company, Rule 158);
(f) During the period beginning from
the date hereof and continuing until the date 45 days after the
date of this Agreement, not to offer, sell, contract to sell or
otherwise dispose of, except as provided hereunder, any Shares or
securities of the Company that are convertible into or exchangeable
for, or that represent the right to receive, Shares or any such
convertible or exchangeable securities (other than
(i) pursuant to stock option or other similar plans existing
on the date of this Agreement, (ii) pursuant to this
Agreement, or (iii) any Shares issued, or options awarded, to
non-employee directors), without the prior written consent of the
Representatives;
(g) To pay the required Commission
filing fees relating to the Securities within the time required by
Rule 456(b)(1) under the Act without regard to the proviso therein
and otherwise in accordance with Rules 456(b) and 457(r) under the
Act;
(h) That the Underwriters shall have
received letters, dated the date of the Pricing Agreement, from
Joseph V. Taranto, Thomas J. Gallagher, Stephen L. Limauro, Keith
T. Shoemaker and Mark S. de Saram (together, the “Applicable
Officers”), whereby each such Applicable Officer agrees, for
the period commencing on the date of this Agreement and ending 5
business days after the date of this Agreement, not to offer, sell,
contract to sell, pledge or otherwise dispose of, directly or
indirectly, any Shares, or publicly disclose the intention to make
any such offer, sale, pledge or disposal without the prior written
consent of the Representatives (other than any trade executed
pursuant to a trading plan of the type described in Rule 10b5-1(c)
under the Exchange Act).
(i) To use its reasonable best
efforts to remain eligible to use Form S-3 under the
Act;
13
(j) To use its best efforts to cause
the Designated Shares to be listed on the New York Stock
Exchange;
(k) To use the net proceeds received
by it from the sale of the Designated Shares pursuant to this
Agreement and the Pricing Agreement in the manner set forth in the
Prospectus as amended or supplemented under the caption “Use
of Proceeds”; and
(l) Upon request of any Underwriter,
to furnish, or cause to be furnished, to such Underwriter an
electronic version of the Company’s trademarks, servicemarks
and corporate logo for use on the website, if any, operated by such
Underwriter for the purpose of facilitating the on-line offering of
the Shares (the “License”); provided, however, that the
License shall be used solely for the purpose described above, is
granted without any fee and may not be assigned or
transferred.
6. (a) The Company represents
and agrees that, without the prior consent of the Representatives,
neither it nor any of its subsidiaries has made, or will make, any
offer relating to the Designated Shares that would constitute a
“free writing prospectus” as defined in Rule 405 under
the Act; each Underwriter represents and agrees that, without the
prior consent of the Company and the Representatives, it has not
made and will not make any offer relating to the Securities that
would constitute a free writing prospectus; any such free writing
prospectus the use of which has been consented to by the Company
and the Representatives is listed on Schedule III to the applicable
Pricing Agreement;
(b) The Company has complied and
will comply with the requirements of Rule 433 under the Act
applicable to any Issuer Free Writing Prospectus, including timely
filing with the Commission or retention where required and
legending; and
(c) The Company agrees that if at
any time following issuance of an Issuer Free Writing Prospectus
any event occurred or occurs as a result of which such Issuer Free
Writing Prospectus would conflict with the information in the
Registration Statement, the Pricing 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 then prevailing, not
misleading, the Company will give prompt notice thereof to the
Representatives and, if requested by the Representatives, will
prepare and furnish without charge to each Underwriter an Issuer
Free Writing Prospectus or other document which will correct such
conflict, statement or omission; provided, however, that this
representation and warranty shall not apply to any statements or
omissions in an Issuer Free Writing Prospectus made in reliance
upon and in conformity with information furnished in writing to the
Company by an Underwriter through the Representatives expressly for
use therein.
7. The Company and the Selling
Stockholder covenant and agree with the several Underwriters that
the Company and the Selling Stockholder will pay or cause to be
paid the following: (i) the fees, disbursements and expenses
of the Company’s counsel and accountants in connection with
the registration of the Designated Shares under the Act and all
other out-of-pocket expenses in connection with the preparation,
printing and filing of the Registration Statement, the Basic
Prospectus, any Preliminary Prospectus, any Issuer Free Writing
Prospectus, the Pricing Prospectus and the Prospectus and
amendments and supplements thereto and the mailing and delivering
of copies thereof to the Underwriters and dealers;
(ii) the
14
cost of printing or producing (excluding any
related legal fees) any Agreement among Underwriters, this
Agreement, the Pricing Agreement, any Blue Sky or similar
investment memoranda, closing documents (including any compilations
thereof) and any other documents in connection with the offering,
purchase, sale and delivery of the Designated Shares;
(iii) all expenses in connection with the qualification of the
Designated Shares for offering and sale under state securities laws
as provided in Section 5(c) hereof, including the reasonable
fees and disbursements of counsel for the Underwriters in
connection with such qualification and in connection with any Blue
Sky memoranda; (iv) any filing fees incident to, and the
reasonable fees and disbursements of counsel for the Underwriters
in connection with, any required review by the National Association
of Securities Dealers, Inc. of the terms of the sale of the
Designated Shares; (v) the cost of preparing certificates for
the Designated Shares; (vi) the cost and charges of any
transfer agent or registrar or dividend disbursing agent;
(vii) all expenses and taxes arising as a result of the
issuance, sale and delivery of the Designated Shares to or for the
respective accounts of the Underwriters, and all Bermuda taxes,
duties or similar expenses arising as a result of the sale and
delivery outside of Bermuda of the Designated Shares by the
Underwriters to the initial purchasers thereof, in the manner
contemplated under this Agreement and the Pricing Agreement
including, in any such case, any Bermuda income, capital gains,
withholding, transfer or other tax asserted against an Underwriter
by reason of the purchase and sale of the Designated Shares
pursuant to the Underwriting Agreement and the Pricing Agreement;
and (viii) all other costs and expenses incident to the
performance of its obligations hereunder and under any
Over-allotment Options which are not otherwise specifically
provided for in this Section. It is understood, however, that,
except as provided in this Section and Sections 9 and 12 hereof,
the Underwriters will pay all of their own costs and expenses,
including the fees of their counsel, transfer taxes on resale of
any of the Shares by them (other than any imposed by Bermuda or any
political subdivision or taxing authority thereof or therein), and
any advertising expenses connected with any offers they may
make.
8. The obligations of the
Underwriters of any Designated Shares under the Pricing Agreement
relating to such Designated Shares shall be subject, in the
discretion of the Representatives, to the condition that all
representations and warranties and other statements of the Company
and of the Selling Stockholder in or incorporated by reference in
the Pricing Agreement relating to such Designated Shares are, at
and as of the Time of Delivery for such Designated Shares, true and
correct, the condition that the Company and the Selling Stockholder
shall have performed all of their obligations hereunder theretofore
to be performed, and the following additional
conditions:
(a) The Prospectus as amended or
supplemented in relation to such Designated Shares shall have been
filed with the Commission pursuant to Rule 424(b) within the
applicable time period prescribed for such filing by the rules and
regulations under the Act and in accordance with Section 5(a)
hereof; if the Company has elected to rely upon Rule 462(b), the
Rule 462(b) Registration Statement shall have become effective by
10:00 P.M., Washington, D.C. time, on the date of this Agreement;
all material required to be filed by the Company pursuant to Rule
433(d) under the Act shall have been filed with the Commission
within the applicable time period prescribed for such filings by
Rule 433; no stop order suspending the effectiveness of the
Registration Statement or any part thereof shall have been issued
and no proceeding for that purpose shall have been initiated
or
15
