Exhibit 1.1
American Water Works Company,
Inc.
Common Stock, Par Value $0.01 Per
Share
Underwriting
Agreement
June 4, 2009
Merrill Lynch, Pierce, Fenner &
Smith
Incorporated
Citigroup Global Markets Inc.
Goldman, Sachs & Co.
As representatives of the several
Underwriters
named in Schedule I hereto,
c/o Merrill Lynch, Pierce, Fenner &
Smith
Incorporated,
4 World Financial Center,
New York, New York 10080.
Ladies and Gentlemen:
American Water Works Company, Inc.,
a Delaware 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 ”) an aggregate of
14,500,000 shares of common stock, par value $0.01 per share
(“ Stock ”) of the Company and RWE Aqua Holdings
GmbH, a limited liability company organized under the laws of the
Federal Republic of Germany (the “ Selling Stockholder
”) proposes, subject to the terms and conditions stated
herein, to sell to the Underwriters an aggregate of 11,500,000
shares and, at the election of the Underwriters, up to 3,900,000
additional shares of Stock (the “ Offering ”).
The aggregate of 26,000,000 shares to be sold by the Company
and the Selling Stockholder is herein called the “ Firm
Shares ” and the aggregate of 3,900,000 additional shares
to be sold by the Selling Stockholder is herein called the “
Optional Shares ”. The Firm Shares and the Optional
Shares that the Underwriters elect to purchase pursuant to
Section 3 hereof are herein collectively called the “
Shares ”.
The Company represents and warrants
to, and agrees with, each of the Underwriters that:
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. 333-158949) in respect of the Shares 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, each in a form heretofore delivered to the
Representatives, and, excluding exhibits thereto but including all
documents incorporated by reference in the prospectus contained
therein, to the Representatives for each of the other Underwriters,
became effective on filing; and no stop order suspending the
effectiveness of such registration statement or any part thereof
has been issued and, to the Company’s knowledge, no
proceeding for that purpose has been initiated or 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 Shares 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 Shares 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 1(c) hereof), is hereinafter called the “
Pricing Prospectus ”; the form of the final prospectus
relating to the Shares filed with the Commission pursuant to Rule
424(b) under the Act in accordance with Section 6(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 Shares 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 Shares is hereinafter called an
“ Issuer Free Writing Prospectus ”);
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
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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
Merrill Lynch, Pierce, Fenner & Smith Incorporated,
Citigroup Global Markets Inc. or Goldman, Sachs & Co.
(collectively, the “ Representatives ”)
expressly for use therein (the “ Underwriter
Information ”), or by the Selling Stockholder expressly
for use in the preparation of the answers therein to Item 7 of
Form S-3, it being agreed upon that such information consists
solely of the information concerning the Selling Stockholder under
the caption “Principal and Selling Stockholder” in the
Prospectus (the “ Selling Stockholder Information
”);
For the purposes of this Agreement,
the “ Applicable Time ” is 5:15 p.m. (Eastern
time) on the date of this Agreement. The Pricing Prospectus, when
considered together with the price to the public of the Shares and
the number of Shares as set forth on the cover page of the
Prospectus (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 III 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 the representations and warranties
in this clause (c) shall not apply to statements or omissions
made in an Issuer Free Writing Prospectus in reliance upon and in
conformity with the Underwriter Information;
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 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,
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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 the Underwriter Information;
(i) 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
and the rules and regulations of the Commission thereunder and
(ii) the Registration Statement and the Prospectus and any
further amendments or supplements to the Registration Statement and
the Prospectus 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 the Underwriter Information or, solely
with respect to clause (e)(ii), the Selling Stockholder
Information;
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 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, 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 change in the capital stock or increase in 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, stockholders’ equity or results of operations of
the Company and its subsidiaries, taken as a whole, otherwise than
as set forth or contemplated in the Pricing Prospectus;
The Company and its subsidiaries
have good and marketable title in fee simple to all real property
and good and marketable title to all personal property owned by
them, in each case free and clear of all liens, encumbrances and
defects except such as are described in the Pricing Prospectus or
such as do not affect the value of such property and do not
interfere with the use made and proposed to be made of such
property by the Company and its subsidiaries except, in each case,
as would not, individually or in the aggregate, have a material
adverse effect on the financial condition, stockholders’
equity, properties or results of operations of the Company and its
subsidiaries, taken as a whole (a “ Material Adverse
Effect ”); and any real property and buildings held under
lease by the Company and its subsidiaries are held by them under
valid, subsisting and enforceable leases with such exceptions as
are not material and do not interfere with the use made and
proposed to be made of such property and buildings by the Company
and its subsidiaries, otherwise than as set forth or contemplated
in the Pricing Prospectus or as would not, individually or in the
aggregate, have a Material Adverse Effect;
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The Company has been duly
incorporated and is validly existing as a corporation in good
standing under the laws of Delaware, with power and authority
(corporate and other) to own its properties and conduct its
business as described in the Pricing Prospectus, and has been duly
qualified as a foreign corporation for the transaction of business
and is in good standing 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 or in good standing would not, individually or in the
aggregate, have a Material Adverse Effect; and each subsidiary of
the Company listed on Schedule V hereto (each a “
Significant Subsidiary ”) has been duly incorporated
and is validly existing as a corporation in good standing under the
laws of its jurisdiction of incorporation, except where the failure
to be in good standing would not, individually or in the aggregate,
have a Material Adverse Effect;
All of the issued shares of capital
stock of the Company have been duly and validly authorized and
issued and are fully paid and non-assessable and conform to the
description of the Stock contained in the Pricing Prospectus and
Prospectus; and all of the issued shares of capital stock of each
Significant Subsidiary have been duly and validly authorized and
issued, are fully paid and non-assessable and (except for
directors’ qualifying shares and except as otherwise set
forth in the Pricing Prospectus) are owned directly or indirectly
by the Company, free and clear of all liens, encumbrances, equities
or claims, except for liens, encumbrances, equities or claims that
would not, individually or in the aggregate, have a Material
Adverse Effect;
The Shares to be issued and sold by
the Company to the Underwriters hereunder have been duly and
validly authorized and, when issued and delivered against payment
therefor as provided herein, will be duly and validly issued and
fully paid and non-assessable and will conform to the description
of the Stock contained in the Pricing Prospectus and
Prospectus;
The issue and sale of the Shares and
the compliance by the Company with this Agreement and the
consummation of the transactions herein contemplated (i) 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
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, and
(ii) will not result in any violation of (A) the
provisions of the Restated Certificate of Incorporation of the
Company (the “ Certificate of Incorporation ”)
or the Amended and Restated By-laws of the Company (the “
By-laws ”) or (B) any statute or any order, rule
or regulation of any court or governmental agency or body having
jurisdiction over the Company or any of its subsidiaries or any of
their properties, except in the case of clauses (i) and
(ii)(B) for any conflict, breach or violation that would not,
individually or in the aggregate, have a Material Adverse Effect or
impair the ability of the Company to consummate the
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transactions contemplated by this 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 issue and sale of the Shares or the
consummation by the Company of the transactions contemplated by
this Agreement, except (i) approval by each of the regulatory
bodies listed in Schedule IV(a) (the “ Regulatory
Approvals ”), each of which has been obtained and is in
full force and effect, (ii) the registration under the Act of
the Shares, (iii) 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
approval of the Financial Industry Regulatory Authority (“
FINRA ”) of the underwriting terms and arrangements in
connection with the purchase and distribution of the Shares by the
Underwriters and (v) such consents, approvals, authorizations,
orders, registrations or qualifications that have already been
obtained or the failure of which to obtain would not, individually
or in the aggregate, reasonably be expected to have a Material
Adverse Effect or impair the ability of the Company to consummate
the transactions contemplated by this Agreement;
Neither the Company nor any of its
subsidiaries is (A) in violation of the Certificate of
Incorporation or By-laws, in the case of the Company, or similar
organizational documents, in the case of its subsidiaries, or
(B) 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 agreement or instrument to which it is a party or by which it
or any of its properties may be bound, except in the case of clause
(A) (with respect to subsidiaries of the Company other than
the Significant Subsidiaries) and clause (B), for violations or
defaults that would not, individually or in the aggregate, have a
Material Adverse Effect;
The statements set forth in the
Pricing Prospectus and Prospectus under the caption
“Description of Capital Stock”, insofar as they purport
to constitute a summary of the terms of the Stock, under the
caption “Underwriting” insofar as they purport to
describe the provisions of the documents described therein, under
the caption “Material United States Federal Tax Consequences
to Non-U.S. Stockholders”, in the Company’s most recent
Annual Report on Form 10-K under the captions “Item 1A. Risk
Factors—Risks Related to Our Industry and Business—Our
utility operations are heavily regulated. Decisions by state PUCs
and other regulatory agencies can significantly affect our business
and results of operations”, “Item 1A. Risk
Factors—Risks Related to Our Industry and Business—In
order to consummate the proposed RWE Divestiture, we and RWE were
required to obtain approvals from thirteen state PUCs. There can be
no guarantee that some state PUC approvals already granted to us
will not be appealed, withdrawn, modified or stayed”;
“Item 1A. Risk Factors—Risks Related to our Industry
and Business—In order to obtain the state PUC approvals to
consummate the proposed RWE Divestiture we were required to accept
certain conditions and restrictions that could increase our
costs”; and in the Pricing Prospectus under the caption
“Business—Our Regulated
Businesses—Regulation—Economic Regulation”
insofar as they purport to describe the provisions of the laws and
documents referred to therein, are accurate, complete and fair in
all material respects;
6
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 would reasonably be expected to, individually
or in the aggregate, have 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;
The Company is not and, after giving
effect to the sale of the Shares and the application of the
proceeds thereof, will not be an “investment company”,
as such term is defined in the Investment Company Act of 1940, as
amended (the “ Investment Company Act
”);
(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 Shares in
reliance on the exemption of Rule 163 under the Act, the Company
was a “well-known seasoned issuer” as 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 Shares, the Company was not
and is not an “ineligible issuer” as defined in Rule
405 under the Act;
PricewaterhouseCoopers LLP, which
has certified certain financial statements of the Company and its
subsidiaries, is an independent registered public accounting firm
with respect to the Company as required by the Act and the rules
and regulations of the Commission thereunder;
Except as disclosed in the Pricing
Prospectus, the Company maintains a system of internal control over
financial reporting (as such term is defined in Rule 13a-15(f)
under the Exchange Act) that complies in all material respects 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. Except as
disclosed in the Pricing Prospectus, 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;
Except as disclosed in the Pricing
Prospectus, 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;
7
The Company maintains disclosure
controls and procedures (as such term is defined in Rule 13a-15(e)
under the Exchange Act) that comply in all material respects 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; and, except as disclosed
in the Pricing Prospectus, such disclosure controls and procedures
are effective;
The Company and its subsidiaries
possess all permits, licenses, franchises, authorizations,
registrations, qualifications and approvals of governmental or
regulatory authorities as may be required of them to own their
properties and conduct their businesses in the manner described in
the Pricing Prospectus (collectively, “ Permits
”), except where the failure to possess such Permits would
not, individually or in the aggregate, have a Material Adverse
Effect; and the Company and its subsidiaries have fulfilled and
performed all of their obligations with respect to such Permits,
and no event has occurred which allows or, after notice or lapse of
time or both, would allow revocation or termination thereof or
result in any other material impairment of the rights of the holder
of any such Permit, except, in each case, as would not,
individually or in the aggregate, have a Material Adverse
Effect;
To the Company’s knowledge,
the Company and each of its subsidiaries own, possess or have the
right to employ sufficient patents, patent rights, licenses,
inventions, copyrights, know how (including trade secrets and other
unpatented and/or unpatentable proprietary or confidential
information, software, systems or procedures), trademarks, service
marks and trade names, inventions, computer programs, technical
data and information (collectively, the “ Intellectual
Property Rights ”) reasonably necessary to conduct their
businesses as now conducted, except where the failure to own,
possess or have the right would not, individually or in the
aggregate, have a Material Adverse Effect. Neither the Company nor
any of its subsidiaries has received any notice of infringement or
conflict with asserted rights of others with respect to any of the
Intellectual Property Rights, whether or not arising from
transactions in the ordinary course of business, except for such
infringements or conflicts that would not, individually or in the
aggregate, have a Material Adverse Effect. To the Company’s
knowledge, the use of the Intellectual Property Rights in
connection with the business and operations of the Company and its
subsidiaries does not infringe on the rights of any
person;
Except as disclosed in the Pricing
Prospectus, neither the Company nor any of its subsidiaries
(i) is in violation of any law, statute, or any rule,
regulation, decision or order of any governmental agency or body or
any court relating to the use, disposal or release of hazardous or
toxic substances or relating to the protection or restoration of
the environment or human exposure to hazardous or toxic substances
(collectively, “ Environmental Laws ”),
(ii) owns or operates any real property which, to its
knowledge, is contaminated with any substance that is regulated
under any Environmental Laws, (iii) is, to its knowledge,
liable for any off-site disposal or contamination pursuant to any
Environmental Laws, or (iv) has received any written notice of
any claim under any Environmental Laws, and the Company is not
aware of any pending investigation which could reasonably be
expected to lead to such a claim, in the case of clauses (i),
(ii), (iii) and (iv), which could have, individually or in the
aggregate, a Material Adverse Effect;
8
The Company and each of its
subsidiaries are insured by insurers of recognized financial
responsibility against such losses and risks and in such amounts as
are, in management’s judgment, prudent and customary in the
businesses in which they are engaged; neither the Company nor any
such subsidiary has been refused any insurance coverage sought or
applied for; and neither the Company nor any such subsidiary has
any reason to believe that it will not be able to renew its
existing insurance coverage as and when such coverage expires or to
obtain similar coverage from similar insurers as may be necessary
to continue its business at a cost that would not, individually or
in the aggregate, have a Material Adverse Effect, except, in each
case, as set forth in or contemplated in the Pricing
Prospectus;
The Company 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;
Except as described in the Pricing
Prospectus, there are no persons with registration rights or other
similar rights to have any securities registered pursuant to the
Registration Statement or otherwise registered by the Company under
the Act;
a) The Company is in compliance in
all material respects with all provisions of the Sarbanes-Oxley Act
of 2002 that are effective and applicable to the Company as of the
date hereof;
The Company and each of its
subsidiaries have filed all required federal, state and foreign tax
returns, and have paid all taxes shown as due thereon except where
the failure to so file such returns would not, individually or in
the aggregate, have a Material Adverse Effect; and other than tax
deficiencies which the Company or any of its subsidiaries is
contesting in good faith and for which the Company or any of its
subsidiaries has provided adequate reserves, there is no tax
deficiency that has been asserted in writing against the Company or
any of its subsidiaries that would, individually or in the
aggregate, have a Material Adverse Effect; and the United States
federal income tax returns of the Company and its subsidiaries
through the fiscal year ended December 31, 2007 have been
settled and no assessment in connection therewith has been made
against the Company or any of its subsidiaries that would,
individually or in the aggregate, have a Material Adverse Effect;
and
None of the following events has
occurred or exists: (i) a failure to fulfill the obligations,
if any, under the minimum funding standards of Section 302 of
the United States Employee Retirement Income Security Act of 1974,
as amended (“ ERISA ”), and the regulations and
published interpretations thereunder with respect to a Plan,
determined without regard to any waiver of such obligations or
extension of any
9
amortization period; (ii) an audit or
investigation by the Internal Revenue Service, the U.S. Department
of Labor, the Pension Benefit Guaranty Corporation or any other
federal or state governmental agency or any foreign regulatory
agency with respect to the employment or compensation of employees
by any of the Company or any of its subsidiaries that could,
individually or in the aggregate, have a Material Adverse Effect;
(iii) any breach of any contractual obligation, or any
violation of law or applicable qualification standards, with
respect to the employment or compensation of employees by the
Company or any of its subsidiaries that could, individually or in
the aggregate, have a Material Adverse Effect. None of the
following events has occurred or is reasonably likely to occur:
(i) an increase in the aggregate amount of contributions
required to be made to all Plans in the current fiscal year of the
Company and its subsidiaries compared to the amount of such
contributions made in the most recently completed fiscal year of
the Company and its subsidiaries; (ii) an increase in the
“accumulated post-retirement benefit obligations”
(within the meaning of Statement of Financial Accounting
Standards 106) of the Company and its subsidiaries compared to
the amount of such obligations in the most recently completed
fiscal year of the Company and its subsidiaries; (iii) any
event or condition giving rise to a liability under Title IV of
ERISA; or (iv) the filing of a claim by one or more employees
or former employees of the Company or any of its subsidiaries
related to their employment, in the case of clauses (i), (ii),
(iii) and (iv), that could, individually or in the aggregate,
have a Material Adverse Effect. For purposes of this paragraph, the
term “ Plan ” means a plan (within the meaning
of Section 3(3) of ERISA) subject to Title IV of ERISA with
respect to which the Company or any of its subsidiaries may have
any liability.
Any certificate signed by any
authorized officer of the Company and delivered to the
Representatives or counsel for the Underwriters in connection with
the offering of the Shares shall be deemed a representation and
warranty by the Company, as to matters covered thereby, to each
Underwriter.
The Selling Stockholder represents
and warrants to, and agrees with, each of the Underwriters and the
Company that:
All consents, approvals,
authorizations and orders necessary for the execution and delivery
by the Selling Stockholder of this Agreement, and for the sale and
delivery of the Shares to be sold by the Selling Stockholder
hereunder, have been obtained; and the Selling Stockholder has full
right, power and authority to enter into this Agreement and to
sell, assign, transfer and deliver the Shares to be sold by the
Selling Stockholder hereunder;
The sale of the Shares to be sold by
the Selling Stockholder hereunder and the compliance by the Selling
Stockholder with all of the provisions of this Agreement and the
consummation of the transactions herein contemplated will not
(A) 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
agreement or instrument to which the Selling Stockholder is a party
or by which the Selling Stockholder is bound or to which any of the
property or assets of the Selling Stockholder
10
is subject, (B) result in any violation of
the provisions of the articles ( Gesellschaftsvertrag ) of
the Selling Stockholder or (C) result in any violation of any
statute or any order, rule or regulation of any court or
governmental agency or body having jurisdiction over the Selling
Stockholder or the property of the Selling Stockholder, except in
the case of clauses (A) and (C), for such conflicts, breaches
or violations that do not impair the ability of the Selling
Stockholder to consummate the transactions contemplated by this
Agreement;
Upon payment for the Shares to be
sold by the Selling Stockholder pursuant to this Agreement,
delivery of such Shares, as directed by the Underwriters, to
Cede & Co. (“ Cede ”) or such other
nominee as may be designated by the Depository Trust Company
(“ DTC ”), registration of such Shares in the
name of Cede or such other nominee and the crediting of such Shares
on the books of DTC to securities accounts of the Underwriters
(assuming that neither DTC nor any such Underwriter has notice of
any adverse claim (within the meaning of Section 8-105 of the
UCC)), (1) DTC shall be a “ protected purchaser
” of such Shares within the meaning of Section 8-303 of
the UCC, (2) under Section 8-501 of the UCC, the
Underwriters will acquire a valid security entitlement in respect
of such Shares and (3) no action based on any “adverse
claim”, within the meaning of Section 8-102 of the UCC,
to such Shares may be asserted against the Underwriters with
respect to such security entitlement; for purposes of this
representation, the Selling Stockholder may assume that when such
payment, delivery and crediting occur, (i) such Shares will
have been registered in the name of Cede or another nominee
designated by DTC, (ii) DTC will be registered as a “
clearing corporation ” within the meaning of
Section 8-102 of the UCC and (iii) appropriate entries to
the accounts of the several Underwriters on the records of DTC will
have been made pursuant to the UCC;
During the period beginning from the
date hereof and continuing to and including the date 90 days after
the date of the Prospectus (the initial “ Lock-Up
Period ”), the Selling Stockholder agrees 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 convertible into or exchangeable for, or that represent
the right to receive, Stock 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 the prior written consent of the
Representatives; provided, however, that if (1) during
the last 17 days of the initial Lock-Up Period, the Company
releases earnings results or announces material news or a material
event or (2) prior to the expiration of the initial Lock-Up
period, the Company announces that it will release earnings results
during the 15-day period following the last day of the initial
Lock-Up Period, then in each case the Lock-Up Period will be
automatically extended until the expiration of the 18-day period
beginning on the date of release of the earnings results or the
announcement of the material news or material event, as applicable,
unless the Representatives waive, in writing, such extension; the
Selling Stockholder hereby acknowledges that the Company has agreed
herein to provide written notice of any event that would result in
an extension of the Lock-Up Period pursuant to the previous
sentence
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to the Selling Stockholder, the Representatives
and each stockholder subject to the Lock-Up Period pursuant to the
lockup letters described in Section 9(l) (in accordance with
Section 14 herein) and agrees that any such notice properly
delivered will be deemed to have been given to, and received by,
the Selling Stockholder; the Selling Stockholder hereby further
agrees that, prior to engaging in any transaction or taking any
other action that is subject to the terms of this provision during
the period from the date hereof to and including the 34th day
following the expiration of the initial Lock-Up Period, it will
give notice thereof to the Company and will not consummate such
transaction or take any such action unless it has received
confirmation from the Company that the Lock-Up Period (as such may
have been extended pursuant to the previous paragraph) has
expired;
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;
To the extent that any statements or
omissions made in the Registration Statement, the Prospectus, any
Preliminary Prospectus, the Pricing Prospectus or the Prospectus,
or any amendment or supplement thereto, or any Issuer Free Writing
Prospectus are made in reliance upon and in conformity with the
Selling Stockholder Information, such Preliminary Prospectus and
the Registration Statement did, and the Prospectus and any further
amendments or supplements to the Registration Statement and the
Prospectus, when they become effective or are filed with the
Commission, as the case may be, will not contain any untrue
statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements
therein not misleading; and the sale of Shares by the Selling
Stockholder pursuant hereto is not prompted by any material
information concerning the Company or any of its subsidiaries which
is not set forth in the Pricing Prospectus;
The Selling Stockholder will deliver
to the Representatives prior to or at the Time of Delivery (as
hereinafter defined) a properly completed and executed United
States Treasury Department Form W-8 (or other applicable form or
statement specified by Treasury Department regulations in lieu
thereof).
Any certificate signed by any
authorized officer of the Selling Stockholder and delivered to the
Representatives or counsel for the Underwriters in connection with
the offering of the Shares shall be deemed a representation and
warranty by the Selling Stockholder, as to matters covered thereby,
to each Underwriter.
Subject to the terms and conditions
herein set forth, (a) the Company and the Selling Stockholder
agree, severally and not jointly, to sell to each of the
Underwriters, and each of the Underwriters agrees, severally and
not jointly, to purchase from the Company and the Selling
Stockholder, at a purchase price per share of $16.7325, the number
of Firm Shares (to be adjusted by the Representatives so as to
eliminate fractional shares) determined by multiplying the
aggregate number of Firm Shares to be sold by the Company and the
Selling Stockholder as set forth opposite their respective names
in
12
Schedule II hereto by a fraction, the
numerator of which is the aggregate number of Firm Shares to be
purchased by such Underwriter as set forth opposite the name of
such Underwriter in Schedule I hereto and the denominator of
which is the aggregate number of Firm Shares to be purchased by all
of the Underwriters from the Company and the Selling Stockholder
hereunder; and (b) in the event and to the extent that the
Underwriters shall exercise the election to purchase Optional
Shares as provided below, the Selling Stockholder agrees to sell to
each of the Underwriters, and each of the Underwriters agrees,
severally and not jointly, to purchase from the Selling
Stockholder, at the purchase price per share set forth in clause
(a) of this Section 3, that portion of the number of
Optional Shares as to which such election shall have been exercised
(to be adjusted by the Representatives so as to eliminate
fractional shares) determined by multiplying such number of
Optional Shares as to which such election shall have been exercised
by a fraction, the numerator of which is the maximum number of
Optional Shares which such Underwriter is entitled to purchase as
set forth opposite the name of such Underwriter in Schedule I
hereto and the denominator of which is the maximum number of
Optional Shares that all of the Underwriters are entitled to
purchase hereunder.
The Selling Stockholder, as and to
the extent indicated in Schedule I hereto, hereby grants,
severally and not jointly, to the Underwriters the right to
purchase at their election up to 3,900,000 Optional Shares, at the
purchase price per share set forth in the paragraph above, for the
sole purpose of covering sales of shares in excess of the number of
Firm Shares, provided that the purchase price per Optional Share
shall be reduced by an amount per share equal to any dividends or
distributions declared by the Company and payable on the Firm
Shares
