Exhibit 1.1
Legg Mason, Inc.
20,000,000 Equity Units
(Initially Consisting of 20,000,000 Corporate Units)
Underwriting Agreement
May 6, 2008
Citigroup Global Markets Inc.
388
Greenwich Street
New
York, New York 10013
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
4 World Financial Center
New York, New York 10080
As
Representatives of the several Underwriters
named in Schedule I hereto
Ladies and Gentlemen:
Legg Mason, Inc., a Maryland corporation
(the “Company”), proposes, subject to the terms and
conditions stated herein, to issue and sell to the Underwriters
named in Schedule I hereto (the “Underwriters”), for
which Citigroup Global Markets Inc. and Merrill Lynch, Pierce,
Fenner & Smith Incorporated are acting as representatives
(the “Representatives”), an aggregate of 20,000,000
Equity Units of the Company (the “Firm Securities”)
and, at the election of the Underwriters, up to an aggregate of
3,000,000 additional Equity Units (the “Optional
Securities”) (the Firm Securities and the Optional Securities
which the Underwriters elect to purchase pursuant to Section 2
hereof are herein collectively called the
“Securities”). Each Equity Unit will have a
stated amount of $50.00 and initially consist of (i) a stock
purchase contract (each, a “Purchase Contract”) under
which the holder will agree to purchase and the Company will agree
to sell on June 30, 2011 (the “Settlement Date”),
subject to acceleration in connection with any early settlement of
such Purchase Contract pursuant to the provisions of the Purchase
and Pledge Agreement (as defined below), for a price of $50.00 per
Security, a number of shares of common stock (the “Issuable
Common Stock”) of the Company, par value $0.10 per share (the
“Common Stock”), determined pursuant to the terms of
the Purchase
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and
Pledge Agreement and (ii) a 1/20, or 5.0%, undivided
beneficial ownership interest in a $1,000 principal amount senior
note due June 30, 2021 (the “Notes”).
A
holder’s ownership interest in the Notes initially will be
pledged to secure such holder’s obligation to purchase the
Issuable Common Stock on the Settlement Date, such pledge to be on
the terms and conditions set forth in the Purchase Contract and
Pledge Agreement (the “Purchase and Pledge Agreement”),
to be dated as of the First Time of Delivery (as defined herein),
among the Company, The Bank of New York, as collateral agent (the
“Collateral Agent”), custodial agent (the
“Custodial Agent”) and securities intermediary (the
“Securities Intermediary”), and The Bank of New York,
as stock purchase contract agent (the “Stock Purchase
Contract Agent”).
The
Purchase Contracts will be issued pursuant to the Purchase and
Pledge Agreement. The Purchase Contracts together with the related
Notes are herein referred to as the “Corporate
Units.”
A
holder of Corporate Units, at its option, may elect to create
“Treasury Units” by substituting pledged U.S. treasury
securities for any pledged ownership interests in the Notes. Unless
otherwise indicated, the term “Equity Units” includes
both Corporate Units and Treasury Units.
The
Notes will be issued pursuant to the Indenture, as amended by
Supplemental Indenture No. 1, each to be dated as of the First
Time of Delivery (the “Indenture”), between the Company
and The Bank of New York as trustee (the
“Trustee”).
Pursuant to a remarketing agreement (the
“Remarketing Agreement”) to be entered into among the
Company, the Purchase Contract Agent and a reset agent and
remarketing agent to be designated by the Company (together, the
“Remarketing Agent”), the Notes will be remarketed,
subject to certain terms and conditions.
The
“Component Securities” means, collectively, the
Purchase Contracts, the Notes and the Issuable Common
Stock.
The
terms and rights of any particular issuance of Securities
(including the Component Securities) shall be as specified in
(i) the Indenture or (ii) the Contract and Pledge
Agreement (each document listed in clauses (i) through (ii),
together with the Remarketing Agreement, each, a “Securities
Agreement” and collectively, the “Securities
Agreements”).
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1.
The Company represents and warrants to, and agrees with, each of
the Underwriters that:
(a)
An automatic shelf registration statement (as defined in
Rule 405) on Form S-3 (File No. 333-150653) (the
“Initial Registration Statement”) in respect of the
Securities and the Component Securities has been filed with the
Securities and Exchange Commission (the “Commission”)
under the Securities Act of 1933, as amended (the
“Act”), and the rules and regulations of the
Commission thereunder; the Initial Registration Statement and any
post effective amendment thereto, each in the form heretofore
delivered to the Representatives, and excluding exhibits to the
Initial Registration Statement, became effective upon filing; no
other document with respect to the Initial Registration Statement
or document incorporated by reference therein has heretofore been
filed, or transmitted for filing, with the Commission (other than
prospectuses filed pursuant to Rule 424(b) of the
rules and regulations of the Commission under the Act, each in
the form heretofore delivered to the Representatives); and no stop
order suspending the effectiveness of the Initial Registration
Statement, any post-effective amendment thereto or any part thereof
has been issued and no proceeding for that purpose has been
initiated or threatened by the Commission; the base prospectus
filed as part of the Initial 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 relating to the Securities, 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
the Initial Registration Statement including all exhibits thereto
and including any prospectus supplement relating to the Securities
that is filed with the Commission and deemed by virtue of
Rule 430B under the Act to be part of the Initial Registration
Statement, each as amended at the time such part of the Initial
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 1(c) hereof),
is hereinafter called the “Pricing Prospectus”; the
form of the final prospectus relating to the Securities 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, 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
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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 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 8:00 p.m. (Eastern time) on the date of this
Agreement; the Pricing Prospectus as supplemented by the final term
sheet prepared and filed pursuant to Section 5(a) hereof,
taken together (collectively, the “Pricing Disclosure
Package”) 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 II(a) hereto 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
Disclosure Package 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 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
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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; and 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 an Underwriter
through the Representatives expressly for use therein; 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, except as set forth on Schedule
II(b) hereto;
(e)
The Registration Statement conforms, and the Prospectus and any
further amendments or supplements to the Registration Statement and
the Prospectus will conform, in all material respects to the
requirements of the Act, the rules and regulations of the
Commission thereunder and the Trust Indenture Act of 1939, as
amended (the “Trust Indenture Act”) and do not and will
not, as of the applicable effective date as to each part of the
Registration Statement 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 an Underwriter
through the Representatives expressly for use therein;
(f)
(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 Sections 13 or 15(d) of
the Exchange Act or form of prospectus), (iii) at the time the
Company or any person acting on its behalf (within the meaning, for
this clause only, of Rule 163(c)) made any offer relating to
the Securities in reliance on the exemption in Rule 163, and
(iv) at the Applicable Time (with such date being used as the
determination date for purposes of this clause (iv)), the Company
was or is (as the case may be) a “well-known seasoned
issuer” as defined in Rule 405. The Company agrees
to pay the fees required by the Commission relating to the
Securities within the time required by
Rule 456(b)(1) without regard to the proviso therein and
otherwise in accordance with Rules 456(b) and
457(r);
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(g)
(i) At the earliest time after the filing of the Initial
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 and
(ii) as of the Applicable Time (with such date being used as
the determination date for purposes of this clause (ii)), the
Company was not and is not an “ineligible issuer” (as
defined in Rule 405 under the Act), without taking account of
any determination by the Commission pursuant to Rule 405 that
it is not necessary that the Company be considered an
“ineligible issuer”;
(h)
The Company has been duly incorporated or organized and is validly
existing in good standing under the laws of the State of Maryland
with all requisite power and authority to own or lease, as the case
may be, and to operate its properties and conduct its business as
described in the Pricing Disclosure Package and the Prospectus, and
is duly qualified to do business as a foreign corporation or
organization and is in good standing under the laws of each
jurisdiction which requires such qualification, whether by reason
of the ownership or leasing of property or the conduct of business,
except where the failure so to qualify or to be in good standing
would not result in a material adverse change in the condition,
financial or otherwise, or in the earnings, business affairs or
business prospects of the Company and its subsidiaries considered
as one enterprise, whether or not arising in the ordinary course of
business (a “Material Adverse Effect”);
(i)
Except as would not result in a Material Adverse Effect, each of
the Company’s subsidiaries: (i) has been duly
incorporated or organized, (ii) is validly existing in good
standing under the laws of the jurisdiction in which it is
chartered or organized with all requisite power and authority to
own or lease, as the case may be, and to operate its properties and
conduct its business as described in the Pricing Disclosure Package
and the Prospectus, and (iii) is duly qualified to do business
as a foreign corporation or organization and is in good standing
under the laws of each jurisdiction which requires such
qualification, whether by reason of the ownership or leasing of
property or the conduct of business;
(j)
Except as would not result in a Material Adverse Effect,
(A) all the outstanding shares of capital stock of each of the
Company’s subsidiaries have been duly and validly authorized
and issued and are fully paid and nonassessable, and
(B) except as may be otherwise set forth in the Pricing
Disclosure Package and the Prospectus, all outstanding shares of
capital stock of such subsidiaries are owned by the Company either
directly or through wholly-owned subsidiaries free and clear of any
perfected security interest or any other security interest,
mortgage, pledge, lien, encumbrance or claim;
(k)
The Company’s authorized equity capitalization is as set
forth in the Pricing Disclosure Package and the Prospectus; the
capital stock of the
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Company conforms in all material respects to
the description thereof contained in the Pricing Disclosure Package
and the Prospectus; the outstanding shares of capital stock of the
Company have been duly and validly authorized and issued and are
fully paid and nonassessable; and the holders of outstanding shares
of capital stock of the Company are not entitled to preemptive or
other rights to subscribe for the Securities;
(l)
The Indenture has been duly authorized by the Company and, at the
Time of Delivery will have been duly executed and delivered by the
Company; at the Time of Delivery, when validly executed and
delivered by the Company and the Trustee, the Indenture will
constitute a valid and legally binding instrument, enforceable in
accordance with its terms, subject, as to enforcement, to
bankruptcy, insolvency, reorganization and other similar laws of
general applicability relating to or affecting creditors’
rights and to general equity principles (collectively, the
“Enforceability Exceptions”); and at the Time of
Delivery, the Indenture will be qualified under and conform in all
material respects to the requirements of the Trust Indenture Act
and the rules and regulations of the Commission applicable to
an indenture that is qualified thereunder;
(m)
The Notes have been duly authorized by the Company and, at the Time
of Delivery will have been duly executed and delivered by the
Company; at the Time of Delivery, when executed and authenticated
in accordance with the provisions of the Indenture and delivered to
and paid for by the Underwriters in accordance with the terms of
the Transaction Documents (as defined below), the Notes will be
valid and legally binding instruments, enforceable in accordance
with their terms, subject, as to enforcement, to the Enforceability
Exceptions, and will be entitled to the benefits of the Indenture
pursuant to which the Notes are to be issued;
(n)
The Securities have been duly authorized by the Company and, at the
Time of Delivery will have been duly executed and delivered by the
Company; at the Time of Delivery, when executed and authenticated
in accordance with the provisions of the Purchase and Pledge
Agreement and delivered to and paid for in accordance with the
terms of the Transaction Documents, the Securities will be valid
and legally binding instruments, enforceable in accordance with
their terms, subject, as to enforcement, to the Enforceability
Exceptions;
(o)
The shares of Issuable Common Stock have been duly and validly
authorized and reserved for issuance and, when issued and delivered
in accordance with the provisions of the Purchase and Pledge
Agreement, will be duly and validly issued, fully paid and
non-assessable and will conform in all material respects to the
description thereof contained in the Pricing Disclosure Package and
the Prospectus or to any amended or supplemented description of
the
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Issuable Common Stock contained in a then
effective report or registration statement filed pursuant to the
Exchange Act; and the issuance of the Issuable Common Stock will
not be subject to any preemptive or similar rights;
(p)
The Purchase and Pledge Agreement has been duly authorized by the
Company and, at the Time of Delivery, will be validly executed and
delivered by the Company; at the Time of Delivery, when validly
executed and delivered by the Company and the other parties
thereto, the Purchase and Pledge Agreement will constitute a valid
and legally binding instrument, enforceable in accordance with its
terms, except to the extent that enforceability thereof may be
limited by the Enforceability Exceptions;
(q)
The Remarketing Agreement has been duly authorized by the Company
and, at the Time of Delivery, will be duly executed and delivered
by the Company; and the Remarketing Agreement will conform in all
material respects to the description thereof contained in the
Pricing Disclosure Package and the Prospectus;
(r)
The Company has the full right, power and authority to execute and
deliver each of this Agreement, the Notes, the Securities and each
Securities Agreement (collectively, the “Transaction
Documents”) to which it is a party and perform its respective
obligations thereunder; and all corporate action required to be
taken for the due and proper authorization, execution and delivery
of each of the Transaction Documents and the consummation of the
transactions contemplated thereby has been duly and validly
taken;
(s)
The statements set forth in the Pricing Prospectus and the
Prospectus under the captions “Description of the Equity
Units,” “Description of the Purchase Contracts,”
“Description of the Notes” and “Certain
Provisions of the Purchase Contract and Pledge Agreement”,
insofar as they purport to constitute a summary of the terms of the
Securities, under the caption “United States Federal Income
Tax Consequences” and under the caption
“Underwriting”, in each case insofar as they purport to
describe the provisions of the laws and documents referred to
therein, are accurate, complete and fair;
(t)
There is no franchise, contract or document which is required to be
described in the Registration Statement, the Pricing Prospectus or
the Prospectus to be filed as exhibits thereto which has not been
so described and filed as required;
(u)
This Agreement has been duly authorized, executed and delivered by
the Company;
(v)
The Company is not and, after giving effect to the offering and
sale of the Securities, will not be an “investment
company” as defined in the Investment Company Act of 1940, as
amended (the “Investment Company Act”);
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(w)
No consent, approval, authorization, filing with or order of any
court or governmental agency or body is required by the Company in
connection with the transactions contemplated by the Transaction
Documents, except the filing of this Agreement on a Report on
Form 8-K or such as have been already obtained or will have
been obtained by the Company under the Act prior to the First Time
of Delivery and such as may be required by the Company under the
blue sky laws of any jurisdiction in connection with the purchase
and distribution of the Securities by the Underwriters in the
manner contemplated herein and in the Pricing Disclosure Package
and the Prospectus;
(x)
Neither the sale of the Securities nor the consummation of any
other of the transactions contemplated herein nor the fulfillment
of the terms hereof by the Company will conflict with, result in a
breach or violation of, or imposition of any lien, charge or
encumbrance upon any property or assets of the Company or any of
its subsidiaries pursuant to (i) the charter or by-laws of the
Company or any of its subsidiaries; (ii) the terms of any
indenture, contract, lease, mortgage, deed of trust, note
agreement, loan agreement or other agreement, obligation,
condition, covenant or instrument to which the Company or any of
its subsidiaries is a party or bound or to which its or their
property is subject; or (iii) any statute, law, rule,
regulation, judgment, order or decree applicable to the Company or
any of its subsidiaries of any court, regulatory body,
administrative agency, governmental body, arbitrator or other
authority having jurisdiction over the Company or any of its
subsidiaries or any of its or their assets, properties, or
operations; except in the cases of clause (i) (solely with
respect to the Company’s subsidiaries) and clauses
(ii) through (iii) as would not result in a Material
Adverse Effect;
(y)
The financial statements included in the Registration Statement,
the Pricing Disclosure Package and the Prospectus, together with
the related schedules and notes, present fairly, in all material
respects, the financial position of the Company and its
consolidated subsidiaries at the dates indicated and the statement
of operations, stockholders’ equity and cash flows of the
Company and its consolidated subsidiaries for the periods
specified; said financial statements have been prepared in
conformity with generally accepted accounting principles
(“GAAP”) applied on a consistent basis throughout the
periods involved and comply as to form with the applicable
accounting requirements of the 1933 Act and the 1933 Act
Regulations. The supporting schedules, if any, included in
the Registration Statement present fairly in accordance with GAAP
the information required to be stated therein; and the selected
financial data and the summary financial information included in
the Pricing Disclosure Package and the Prospectus present fairly
the information shown therein and have been compiled on a basis
consistent with that of the audited financial statements included
in the Registration Statement;
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(z)
There is no action, suit,
proceeding, inquiry or investigation before or brought by any court
or governmental agency or body or before any arbitrator, now
pending, or, to the knowledge of the Company, threatened, against
or affecting the Company or any subsidiary that (i) could
reasonably be expected to result in a material adverse effect on
the performance of this Agreement or the consummation of any of the
transactions contemplated hereby or (ii) could reasonably be
expected to result in a Material Adverse Effect;
(aa)
The Company and each of
its subsidiaries own or lease all such properties as are necessary
to the conduct of its operations as presently
conducted;
(bb)
Neither the Company nor
any of its subsidiaries is in violation or default of (i) any
provision of its charter or by-laws, (ii) the terms of any
indenture, contract, lease, mortgage, deed of trust, note
agreement, loan agreement or other agreement, obligation,
condition, covenant or instrument to which it is a party or bound
or to which its property is subject, or (iii) except as set
forth in the Pricing Disclosure Package and the Prospectus, any
statute, law, rule, regulation, judgment, order or decree of any
Federal, state, local or foreign court, regulatory body,
administrative agency, governmental body, arbitrator or other
authority having jurisdiction over the Company or such subsidiary
or any of its or their properties; except, in the case of clauses
(i) (with respect to subsidiaries only) (ii) or (iii),
for any such violations or default that would not have a Material
Adverse Effect;
(cc)
PricewaterhouseCoopers
LLP, who have certified certain financial statements of the Company
and its subsidiaries, and have audited the Company’s internal
control over financial reporting and management’s assessment
thereof, is an independent registered public accounting firm within
the meaning of the Act and the rules and regulations
thereunder;
(dd)
Each of the Company and
the subsidiaries listed on Schedule III hereto (the
“Significant Subsidiaries”) has filed all foreign,
federal, state and local tax returns that are required to be filed
or has requested extensions thereof (except in any case in which
the failure so to file would not have a Material Adverse Effect)
and has paid all taxes required to be paid by it and any other
assessment, fine or penalty levied against it, to the extent that
any of the foregoing is due and payable, except for any such
assessment, fine or penalty that is currently being contested in
good faith or as would not have a Material Adverse Effect, except
as set forth in or contemplated in the Pricing Disclosure Package
and the Prospectus (exclusive of any supplement thereto); the
Company does not have any significant subsidiaries as defined by
Rule 1-02 of Regulation S-X that are not listed on Schedule
II;
(ee)
The Company and its
subsidiaries, as an entity, are insured by insurers of recognized
financial responsibility against such losses and risks and in such
amounts as are prudent and customary in the businesses in which
they are
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engaged; and there are no 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 that could reasonably be
expected to have a Material Adverse Effect; neither the Company nor
any such subsidiary has been refused any insurance coverage sought
or applied for; and the Company and each such subsidiary believes
that it will be able to renew its existing insurance coverage as
and when such coverage expires, should it elect to do so, or to
obtain similar coverage from similar insurers as may be necessary
to continue its business at a cost that would not have a Material
Adverse Effect, except as set forth in or contemplated in the
Pricing Disclosure Package and the Prospectus (exclusive of any
supplement thereto);
(ff)
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, except as may be described in or
contemplated by the Pricing Disclosure Package and the Prospectus
and except as would not reasonably be expected to result in a
Material Adverse Effect;
(gg)
The Company maintains a
system of internal accounting controls sufficient to provide
reasonable assurance that (i) transactions are executed in
accordance with management’s general or specific
authorizations; (ii) transactions are recorded as necessary to
permit preparation of financial statements in conformity with
generally accepted accounting principles and to maintain asset
accountability; (iii) access to assets is permitted only in
accordance with management’s general or specific
authorization; and (iv) the recorded accountability for assets
is compared with the existing assets at reasonable intervals and
appropriate action is taken with respect to any differences.
The Company and its subsidiaries’ internal controls over
financial reporting are effective and the Company and its
subsidiaries are not aware of any material weakness in their
internal control over financial reporting;
(hh)
The Company maintains
disclosure controls and procedures (as such term is defined in
Rule 13a-15(e) under the Exchange Act) that comply with
the requirements of the Exchange Act;
(ii)
The Company and its
subsidiaries possess all licenses, certificates, permits and other
authorizations issued by the appropriate federal, state or foreign
regulatory authorities necessary to conduct their respective
businesses, except for such licenses, certificates, permits and
other authorizations as to which the failure to so own, hold or
possess would not have a Material Adverse Effect, and neither the
Company nor any such subsidiary has received any notice of
proceedings relating to the revocation or modification of any such
license, certificate,
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authorization or permit which, singly or in the
aggregate, if the subject of an unfavorable decision, ruling or
finding, would reasonably be expected to result in a Material
Adverse Effect, except as set forth in or contemplated in the
Pricing Disclosure Package and the Prospectus (exclusive of any
supplement thereto);
(jj)
The Company has not taken,
directly or indirectly, any action designed to or that would
constitute or that 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 Securities in
violation of the Exchange Act or otherwise;
(kk)
The Company and its
subsidiaries (i) are in compliance with any and all applicable
foreign, federal, state and local laws and regulations relating to
the protection of human health and safety, the environment or
hazardous or toxic substances or wastes, pollutants or contaminants
(“Environmental Laws”), (ii) have received and are
in compliance with all permits, licenses or other approvals
required of them under applicable Environmental Laws to conduct
their respective businesses, (iii) have not received notice of
any actual or potential liability under any environmental law,
except where such non-compliance with Environmental Laws, failure
to receive required permits, licenses or other approvals, or
liability would not, individually or in the aggregate, result in a
Material Adverse Effect. Except as set forth in the Pricing
Disclosure Package and the Prospectus, neither the Company nor any
of the subsidiaries has been named as a “potentially
responsible party” under the Comprehensive Environmental
Response, Compensation, and Liability Act of 1980, as
amended;
(ll)
The minimum funding
standard under Section 302 of the Employee Retirement Income
Security Act of 1974, as amended, and the regulations and published
interpretations thereunder (“ ERISA ”), has been
satisfied by each “pension plan” (as defined in
Section 3(2) of ERISA) which has been established or
maintained by the Company and/or one or more of its subsidiaries,
and the trust forming part of each such plan which is intended to
be qualified under Section 401 of the Code is so qualified;
each of the Company and its subsidiaries has fulfilled its
obligations, if any, under Section 515 of ERISA; neither the
Company nor any of its subsidiaries maintains or is required to
contribute to a “welfare plan” (as defined in
Section 3(1) of ERISA) which provides retiree or other
post-employment welfare benefits or insurance coverage (other than
“continuation coverage” (as defined in Section 602
of ERISA)); each pension plan and welfare plan established or
maintained by the Company and/or one or more of its subsidiaries is
in compliance in all material respects with the currently
applicable provisions of ERISA; and neither the Company nor any of
its subsidiaries has incurred or could reasonably be expected to
incur any withdrawal liability under Section 4201 of ERISA,
any liability under Section 4062, 4063, or 4064 of ERISA, or
any other liability under Title IV of ERISA;
12
(mm)
Except as would not have a
Material Adverse Effect, there is and has been no failure on the
part of the Company, or, to the Company’s knowledge, any of
the Company’s directors or officers, in their capacities as
such, to comply with any provision of the Sarbanes-Oxley Act of
2002 and the rules and regulations promulgated in connection
therewith, including Section 402 relating to loans and
Sections 302 and 906 relating to certifications;
(nn)
The Company and its
subsidiaries own, possess, license or have other rights to use all
patents, patent applications, trade and service marks, trade and
service mark registrations, trade names, copyrights, licenses,
inventions, trade secrets, technology, know-how and other
intellectual property (collectively, the “Intellectual
Property”) necessary for the conduct of their business, taken
as a whole, as now conducted; and neither the Company nor any of
its subsidiaries has received any notice of infringement of or
conflict with asserted rights of others with respect to any
Intellectual Property, which infringement or conflict, individually
or in the aggregate, if the subject of an unfavorable decision,
ruling or finding, would result in a Material Adverse
Effect;
(oo)
Neither the Company nor
any of its subsidiaries have failed to file with applicable
regulatory authorities any statement, report, information or form
required by any applicable law, regulation or order, except where
the failure to file or to be so in compliance would not,
individually and in the aggregate, have a Material Adverse Effect.
No deficiencies have been asserted by any regulatory commission,
agency or authority with respect to any such filings or
submissions, except for any such failures to be in compliance or
deficiencies which would not, individually and in the aggregate,
have a Material Adverse Effect;
(pp)
The Company is subject to
the reporting requirements of Section 13 or
Section 15(d) of the Exchange Act;
(qq)
The Company has not taken,
and will not take, directly or indirectly, any action prohibited by
Regulation M under the Exchange Act in connection with the offering
of the Securities;
(rr)
The Company is not
required to be registered, licensed or qualified as an investment
adviser or a broker-dealer or as a commodity trading advisor, a
commodity pool operator or a future commission merchant or any or
all of the foregoing, as applicable; each of the Company’s
subsidiaries that is required to be registered, licensed or
qualified as an investment adviser or a broker-dealer or as a
commodity trading advisor, a commodity pool operator or a futures
commission merchant or any or all of the foregoing, as applicable,
is so registered, licensed or qualified in each jurisdiction where
the conduct of its business requires such registration, license or
qualification (and such registration, license or qualification is
in full force and effect), and is in compliance with all applicable
laws requiring any such registration, licensing or qualification,
except for any failures to be so registered, licensed or qualified
or to be in such compliance that, individually or
13
in
the aggregate, would not reasonably be expected to have a Material
Adverse Effect;
(ss)
The Company is not a party
as an investment advisor or distributor to any investment advisory
agreement or distribution agreement; each of the investment
advisory agreements and distribution agreements to which any of the
Company’s subsidiaries is a party is a valid and legally
binding obligation of such subsidiary which is a party thereto and
complies with the applicable provisions of the Investment Advisers
Act of 1940, as amended, except for any failures to be so valid and
legally binding and in compliance that, individually or in the
aggregate, would not reasonably be expected to have a Material
Adverse Effect; and none of the Company’s subsidiaries is in
breach or violation of or in default under any such agreement which
breach, violation, default or invalidity, individually or in the
aggregate, would reasonably be expected to have a Material Adverse
Effect;
(tt)
The Company does not
sponsor any funds; each fund sponsored by any of the
Company’s subsidiaries (a “Fund” or the
“Funds”) and which is required to be registered with
the Commission as an investment company under the Investment
Company Act is duly registered with the Commission as an investment
company under the Investment Company Act and the securities of each
fund have been issued and sold in accordance with applicable law,
except for any failures to be so registered or otherwise comply
with applicable law that, individually or in the aggregate, would
not reasonably be expected to have a Material Adverse
Effect;
(uu)
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 and the money laundering statutes and 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; and
(vv)
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 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.
14
Any
certificate signed by any officer of the Company and delivered to
the Representatives or counsel for the R
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