Exhibit 1.1
EXECUTION COPY
Sonic Automotive, Inc.
9,000,000 Shares
Class A Common Stock
($0.01 par value)
Underwriting Agreement
September 17, 2009
J.P. Morgan Securities
Inc.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
As Representatives of the
several Underwriters
listed
in Schedule 1 hereto
c/o J.P. Morgan Securities Inc.
383 Madison Avenue
New York, New York 10179
Ladies and Gentlemen:
Sonic Automotive, Inc., a Delaware
corporation (the “Company”), proposes to issue and sell
to the several Underwriters listed in Schedule 1 hereto (the
“Underwriters”), for whom you are acting as
representatives (the “Representatives”), an aggregate
of 9,000,000 shares of Class A Common Stock, par value $0.01
per share, of the Company (the “Underwritten Shares”)
and, at the option of the Underwriters, up to an additional
1,350,000 shares of Class A Common Stock of the Company (the
“Option Shares”). The Underwritten Shares and the
Option Shares are herein referred to as the “Shares”.
The shares of Class A Common Stock of the Company, par value
$0.01 per share, and Class B Common Stock of the Company, par value
$0.10 per share, to be outstanding after giving effect to the sale
of the Shares are referred to herein as the
“Stock”.
The Company hereby confirms its
agreement with the several Underwriters concerning the purchase and
sale of the Shares, as follows:
1. Registration Statement .
The Company has prepared and filed with the Securities and Exchange
Commission (the “Commission”) under the Securities Act
of 1933, as amended, and the rules and regulations of the
Commission thereunder (collectively, the “Securities
Act”), a registration statement (File No. 333-161519 and
333-161519-01 through 333-161519-277), including a prospectus,
registering shares of Class A Common Stock, preferred stock,
warrants, debt securities and guarantees. Such registration
statement, as amended at the time it became effective, including
the information, if any, deemed pursuant to Rule 430A, 430B or 430C
under the Securities Act to be part of the registration statement
at the time of its effectiveness (“Rule 430
Information”), is referred to herein as the
“Registration Statement”; and as used herein, the term
“Preliminary Prospectus” means any preliminary
prospectus supplement relating to the Shares filed with the
Commission pursuant to Rule 424(b) under the Securities Act that
amends or supplements the Base Prospectus (as hereinafter defined)
and the prospectus
included in the Registration Statement at the
time of its effectiveness that omits Rule 430 Information (the
“Base Prospectus”), and the term
“Prospectus” means the prospectus supplement and the
Base Prospectus in the form first used (or made available upon
request of purchasers pursuant to Rule 173 under the Securities
Act) in connection with confirmation of sales of the Shares. Any
reference in this Agreement to the Registration Statement, 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 Securities Act, as
of the effective date of the Registration Statement or the date of
such Preliminary Prospectus or the Prospectus, as the case may be,
and any reference to “amend”, “amendment”
or “supplement” with respect to the Registration
Statement, any Preliminary Prospectus or the Prospectus shall be
deemed to refer to and include any documents filed after such date
under the Securities Exchange Act of 1934, as amended, and the
rules and regulations of the Commission thereunder (collectively,
the “Exchange Act”) that are deemed to be incorporated
by reference therein. Capitalized terms used but not defined herein
shall have the meanings given to such terms in the Registration
Statement and the Prospectus.
At or prior to the Applicable Time
(as defined below), the Company had prepared the following
information (collectively with the pricing information set forth on
Annex C, the “Pricing Disclosure Package”): a
Preliminary Prospectus dated September 14, 2009 and each
“free-writing prospectus” (as defined pursuant to Rule
405 under the Securities Act) listed on Annex B hereto.
“Applicable Time” means
9:00 A.M., New York City time, on September 18,
2009.
2. Purchase of the Shares by the
Underwriters .
(a) The Company agrees to issue and
sell the Underwritten Shares to the several Underwriters as
provided in this Agreement, and each Underwriter, on the basis of
the representations, warranties and agreements set forth herein and
subject to the conditions set forth herein, agrees, severally and
not jointly, to purchase from the Company the respective number of
Underwritten Shares set forth opposite such Underwriter’s
name in Schedule 1 hereto at a price per share (the “Purchase
Price”) of $10.10.
In addition, the Company agrees to
issue and sell the Option Shares to the several Underwriters as
provided in this Agreement, and the Underwriters, on the basis of
the representations, warranties and agreements set forth herein and
subject to the conditions set forth herein, shall have the option
to purchase, severally and not jointly, from the Company the Option
Shares at the Purchase Price less an amount per share equal to any
dividends or distributions declared by the Company and payable on
the Underwritten Shares but not payable on the Option
Shares.
If any Option Shares are to be
purchased, the number of Option Shares to be purchased by each
Underwriter shall be the number of Option Shares which bears the
same ratio to the aggregate number of Option Shares being purchased
as the number of Underwritten Shares set forth opposite the name of
such Underwriter in Schedule 1 hereto (or such number increased as
set forth in Section 10 hereof) bears to the aggregate number
of Underwritten Shares being purchased from the Company by the
several Underwriters, subject, however, to such adjustments to
eliminate any fractional Shares as the Representatives in its sole
discretion shall make.
The Underwriters may exercise the
option to purchase Option Shares at any time in whole, or from time
to time in part, on or before the thirtieth day following the date
of the Prospectus, by written notice from the Representatives to
the Company. Such notice shall set forth the aggregate number of
Option Shares as to which the option is being exercised and the
date and time when the Option Shares are
to be delivered and paid for, which may be the
same date and time as the Closing Date (as hereinafter defined) but
shall not be earlier than the Closing Date or later than the tenth
full business day (as hereinafter defined) after the date of such
notice (unless such time and date are postponed in accordance with
the provisions of Section 10 hereof). Any such notice shall be
given at least one business day prior to the date and time of
delivery specified therein.
(b) The Company understands that the
Underwriters intend to make a public offering of the Shares as soon
after the effectiveness of this Agreement as in the judgment of the
Representatives is advisable, and initially to offer the Shares on
the terms set forth in the Prospectus. The Company acknowledges and
agrees that the Underwriters may offer and sell Shares to or
through any affiliate of an Underwriter and that any such affiliate
may offer and sell Securities purchased by it or through any
Underwriter.
(c) Payment for the Shares shall be
made by wire transfer in immediately available funds to an account
with U.S. Bank National Association as Escrow Agent pursuant to the
Escrow Agreement (each as defined below) in the case of the
Underwritten Shares, at the offices of Fried, Frank, Harris,
Shriver & Jacobson LLP at 10:00 A.M., New York City time,
on September 23, 2009, or at such other time or place on the
same or such other date, not later than the fifth business day
thereafter, as the Representatives and the Company may agree upon
in writing or, in the case of the Option Shares, on the date and at
the time and place specified by the Representatives in the written
notice of the Underwriters’ election to purchase such Option
Shares. The time and date of such payment for the Underwritten
Shares is referred to herein as the “Closing Date”, and
the time and date for such payment for the Option Shares, if other
than the Closing Date, is herein referred to as the
“Additional Closing Date”.
Payment for the Shares to be
purchased on the Closing Date or the Additional Closing Date, as
the case may be, shall be made against delivery to the
Representatives for the respective accounts of the several
Underwriters of the Shares to be purchased on the Closing Date or
the Additional Closing Date, as the case may be, with any transfer
taxes payable in connection with the sale of such Shares duly paid
by the Company. Delivery of the Shares shall be made through the
facilities of The Depository Trust Company (“DTC”)
unless the Representatives shall otherwise instruct. The
certificates for the Shares will be made available for inspection
and packaging by the Representatives at the office of DTC or its
designated custodian not later than 1:00 P.M., New York City time,
on the business day prior to the Closing Date or the Additional
Closing Date, as the case may be.
(d) As compensation to the
Underwriters for their commitments hereunder, the Company will pay,
or cause to be paid, to the Representatives, for the accounts of
the several Underwriters, an amount equal to $0.49652 per share for
the Shares to be delivered by the Company hereunder on the Closing
Date or the Additional Closing Date, as the case may be. On
September 23, 2009, or on such other date, not later than the
fifth business day thereafter, as the Representatives and the
Company may agree upon in writing, or, in the case of the Option
Shares, on the date and time specified by the Representatives in
the written notice of the Underwriters’ election to purchase
such Option Shares, the Company will pay or cause to be paid by
wire transfer, in immediate available funds, such commission to the
account specified by the Representatives.
(e) The Company acknowledges and
agrees that the Underwriters are acting solely in the capacity of
an arm’s length contractual counterparty to the Company with
respect to the offering of Shares contemplated hereby (including in
connection with determining the terms of the offering) and not as a
financial advisor or a fiduciary to, or an agent of, the Company or
any other person. Additionally, neither the Representatives nor any
other Underwriter is advising the Company or any other person as to
any legal, tax, investment, accounting or regulatory matters in any
jurisdiction. The Company shall
consult with its own advisors concerning such
matters and shall be responsible for making its own independent
investigation and appraisal of the transactions contemplated
hereby, and the Underwriters shall have no responsibility or
liability to the Company with respect thereto. Any review by the
Underwriters of the Company, the transactions contemplated hereby
or other matters relating to such transactions will be performed
solely for the benefit of the Underwriters and shall not be on
behalf of the Company.
3. Representations and Warranties
of the Company . The Company represents and warrants to each
Underwriter as of the Applicable Time and as of the Closing Date
that:
(a) Preliminary Prospectus.
No order preventing or suspending the use of any Preliminary
Prospectus has been issued by the Commission, and each Preliminary
Prospectus included in the Pricing Disclosure Package, at the time
of filing thereof, complied in all material respects with the
Securities Act, and no Preliminary Prospectus, at the time of
filing thereof, contained any untrue statement of a material fact
or omitted to state a material fact required to be stated therein
or necessary in order to make the statements therein, in the light
of the circumstances under which they were made, not misleading;
provided that the Company makes no representation and
warranty with respect to any statements or omissions made in
reliance upon and in conformity with information relating to any
Underwriter furnished to the Company in writing by such Underwriter
through the Representatives expressly for use in any Preliminary
Prospectus, it being understood and agreed that the only such
information furnished by any Underwriter consists of the
information described as such in Section 7(b)
hereof.
(b) Pricing Disclosure
Package . The Pricing Disclosure Package as of the Applicable
Time did not, and as of the Closing Date and as of the Additional
Closing Date, as the case may be, will not, contain any untrue
statement of a material fact or omit to state a material fact
required to be stated therein or necessary in order to make the
statements therein, in the light of the circumstances under which
they were made, not misleading; provided that the Company
makes no representation and warranty with respect to any statements
or omissions made in reliance upon and in conformity with
information relating to any Underwriter furnished to the Company in
writing by such Underwriter through the Representatives expressly
for use in such Pricing Disclosure Package, it being understood and
agreed that the only such information furnished by any Underwriter
consists of the information described as such in Section 7(b)
hereof. No statement of material fact included in the Prospectus
has been omitted from the Pricing Disclosure Package and no
statement of material fact included in the Pricing Disclosure
Package that is required to be included in the Prospectus has been
omitted therefrom.
(c) Issuer Free Writing
Prospectus. Other than the Registration Statement, the
Preliminary Prospectus and the Prospectus, the Company (including
its agents and representatives, other than the Underwriters in
their capacity as such) has not prepared, used, authorized,
approved or referred to and will not prepare, use, authorize,
approve or refer to any “written communication” (as
defined in Rule 405 under the Securities Act) that constitutes an
offer to sell or solicitation of an offer to buy the Shares (each
such communication by the Company or its agents and representatives
(other than a communication referred to in clause (i) below,
but including a communication referred to in clause
(ii) below) an “Issuer Free Writing Prospectus”)
other than (i) any document not constituting a prospectus
pursuant to Section 2(a)(10)(a) of the Securities Act or Rule
134 under the Securities Act or (ii) the documents listed on
Annex B hereto, each electronic road show and any other written
communications approved in writing in advance by the
Representatives. Each such Issuer Free Writing Prospectus complied
in all material respects with the Securities Act, has been or will
be (within the time period specified
in Rule 433) filed in accordance
with the Securities Act (to the extent required thereby) and, when
taken together with the Preliminary Prospectus filed prior to the
first use of such Issuer Free Writing Prospectus, did not, and as
of the Closing Date and as of the Additional Closing Date, as the
case may be, will not, contain any untrue statement of a material
fact or omit to state a material fact necessary in order to make
the statements therein, in the light of the circumstances under
which they were made, not misleading; provided that the
Company makes no representation and warranty with respect to any
statements or omissions made in each such Issuer Free Writing
Prospectus or Preliminary Prospectus in reliance upon and in
conformity with information relating to any Underwriter furnished
to the Company in writing by such Underwriter through the
Representatives expressly for use in such Issuer Free Writing
Prospectus or Preliminary Prospectus, it being understood and
agreed that the only such information furnished by any Underwriter
consists of the information described as such in Section 7(b)
hereof.
(d) Registration Statement and
Prospectus. The Registration Statement has been declared
effective by the Commission. No order suspending the effectiveness
of the Registration Statement has been issued by the Commission,
and no proceeding for that purpose or pursuant to Section 8A
of the Securities Act against the Company or related to the
offering of the Shares has been initiated or, to the
Company’s knowledge, threatened by the Commission; as of the
applicable effective date of the Registration Statement and any
post-effective amendment thereto, the Registration Statement and
any such post-effective amendment complied and will comply in all
material respects with the Securities Act, and did not and will not
contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary in order
to make the statements therein not misleading; and as of the date
of the Prospectus and any amendment or supplement thereto and as of
the Closing Date and as of the Additional Closing Date, as the case
may be, the Prospectus will not contain any untrue statement of a
material fact or omit to state a material fact required to be
stated therein or necessary in order to make the statements
therein, in the light of the circumstances under which they were
made, not misleading; provided that the Company makes no
representation and warranty with respect to any statements or
omissions made in reliance upon and in conformity with information
relating to any Underwriter furnished to the Company in writing by
such Underwriter through the Representatives expressly for use in
the Registration Statement and the Prospectus and any amendment or
supplement thereto, it being understood and agreed that the only
such information furnished by any Underwriter consists of the
information described as such in Section 7(b)
hereof.
(e) Incorporated Documents.
The documents incorporated by reference in the Registration
Statement, the Prospectus and the Pricing Disclosure Package, when
they were filed with the Commission complied in all material
respects to the requirements of the Exchange Act, and, when read
together, none of such documents contained any 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, in the
light of the circumstances under which they were made, not
misleading; and any further documents so filed and incorporated by
reference in the Registration Statement, the Prospectus or the
Pricing Disclosure Package, when such documents are filed with the
Commission, will comply in all material respects to the
requirements of the Exchange Act and, when read together, will not
contain any 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 that the Company
makes no representation and warranty with respect to any statements
or omissions made in reliance upon and in conformity with
information relating to any Underwriter furnished to the Company in
writing by such Underwriter through the Representatives expressly
for use in the
Registration Statement, the Pricing
Disclosure Package or the Prospectus and any amendment or
supplement thereto, it being understood and agreed that the only
such information furnished by any Underwriter consists of the
information described as such in Section 7(b)
hereof.
(f) Financial Statements. The
financial statements (including the related notes thereto) of the
Company and its consolidated subsidiaries included or incorporated
by reference in the Registration Statement, the Pricing Disclosure
Package and the Prospectus comply in all material respects with the
applicable requirements of the Securities Act and the Exchange Act,
as applicable, and present fairly in all material respects the
financial position of the Company and its consolidated subsidiaries
as of the dates indicated and the results of their operations and
the changes in their cash flows for the periods specified; such
financial statements have been prepared in conformity with
generally accepted accounting principles in the United States
applied on a consistent basis throughout the periods covered
thereby except as otherwise noted therein, and any supporting
schedules included or incorporated by reference in the Registration
Statement present fairly in all material respects the information
required to be stated therein; and the other financial information
of the Company and its consolidated subsidiaries included or
incorporated by reference in the Registration Statement, the
Pricing Disclosure Package and the Prospectus has been derived from
the accounting records of the Company and its consolidated
subsidiaries and presents fairly in all material respects the
information shown thereby.
(g) No Material Adverse
Change. Since the date of the most recent financial statements
of the Company included or incorporated by reference in the
Registration Statement, the Pricing Disclosure Package and the
Prospectus, (i) there has not been any change in the capital
stock (other than the issuance of shares of Common Stock upon
exercise of stock options and warrants described as outstanding in,
and the grant of options and awards under existing equity incentive
plans described in, the Registration Statement, the Pricing
Disclosure Package and the Prospectus and documents incorporated by
reference therein), material change in the short-term or long-term
debt of the Company or any of its subsidiaries, or any dividend or
distribution of any kind declared, set aside for payment, paid or
made by the Company on any class of capital stock, or any material
adverse change, or any development involving a prospective material
adverse change, in or affecting, individually or in the aggregate,
the business, properties, management, financial position,
stockholders’ equity, results of operations or prospects of
the Company and its subsidiaries taken as a whole;
(ii) neither the Company nor any of its subsidiaries has
entered into any transaction or agreement (other than those in the
ordinary course of business) that is material to the Company and
its subsidiaries taken as a whole or incurred any liability or
obligation, direct or contingent, that is material to the Company
and its subsidiaries taken as a whole; and (iii) neither the
Company nor any of its subsidiaries has sustained any loss or
interference with its business that is material to the Company and
its subsidiaries taken as a whole and that is either from fire,
explosion, flood or other calamity, whether or not covered by
insurance, or from any labor disturbance or dispute or any action,
order or decree of any court or governmental or regulatory
authority, except in each case as otherwise disclosed or
incorporated by reference into the Registration Statement, the
Pricing Disclosure Package and the Prospectus.
(h) Organization and Good
Standing. The Company and each of its subsidiaries have been
duly organized and are validly existing and in good standing under
the laws of their respective jurisdictions of organization, are
duly qualified to do business and are in good standing in each
jurisdiction in which their respective ownership or lease of
property or the conduct of their respective businesses requires
such qualification, and have all power and authority necessary to
own or hold their respective properties and to conduct the
businesses in which they are
engaged, except where the failure to
be so qualified or in good standing or have such power or authority
would not, individually or in the aggregate, have a material
adverse effect on the business, properties, management, financial
position, stockholders’ equity, results of operations or
prospects of the Company and its subsidiaries taken as a whole or
on the performance by the Company of its obligations under this
Agreement (a “Material Adverse Effect”). The Company
does not own or control, directly or indirectly, any Significant
Subsidiary other than the subsidiaries listed in Exhibit 21 to the
Company’s 10-K for the year 2008.
(i) Capitalization. The
Company has an authorized capital stock as set forth in the
Registration Statement, the Pricing Disclosure Package and the
Prospectus under the heading “Capitalization”; all the
outstanding shares of capital stock of the Company have been duly
authorized and validly issued and are fully paid and non-assessable
and are not subject to any pre-emptive or similar rights; except as
described in or expressly contemplated by the Registration
Statement, Pricing Disclosure Package and the Prospectus, there are
no outstanding rights (including, without limitation, pre-emptive
rights), warrants or options to acquire, or instruments convertible
into or exchangeable for, any shares of capital stock or other
equity interest in the Company, or any contract, commitment,
agreement, understanding or arrangement of any kind relating to the
issuance of any capital stock of the Company, any such convertible
or exchangeable securities or any such rights, warrants or options
(other than those issued or issuable under the Company Stock Plans
or otherwise disclosed in the Registration Statement, Pricing
Disclosure Package and the Prospectus); the capital stock of the
Company conforms in all material respects to the description
thereof contained in the Registration Statement, the Pricing
Disclosure Package and the Prospectus; and all the outstanding
shares of capital stock or other equity interests of each
subsidiary owned, directly or indirectly, by the Company have been
duly and validly authorized and issued, are fully paid and
non-assessable and are owned directly or indirectly by the Company,
free and clear of any lien, charge, encumbrance, security interest,
restriction on voting or transfer or any other claim of any third
party, except as disclosed in the Registration Statement, Pricing
Disclosure Package and the Prospectus.
(j) Stock Options. With
respect to the stock options (the “Stock Options”)
granted pursuant to the stock-based compensation plans of the
Company and its subsidiaries (the “Company Stock
Plans”), (i) each such grant was made in material
compliance with the terms of the Company Stock Plans, the Exchange
Act and all other applicable laws and regulatory rules or
requirements, including the rules of the New York Stock Exchange
and any other exchange on which Company securities are traded, and
(ii) each such grant has been properly accounted for in
accordance with GAAP in the financial statements (including the
related notes) of the Company and disclosed in the Company’s
filings with the Commission in accordance with the Exchange Act and
all other applicable laws. The Company has not knowingly granted,
and there is no and has been no policy or practice of the Company
of granting, Stock Options prior to the release or other public
announcement of material information regarding the Company or its
subsidiaries or their results of operations or prospects in a
manner designed to manipulate the exercise price of Stock
Options.
(k) Due Authorization. The
Company has full right, power and authority to execute and deliver
this Agreement and to perform its obligations hereunder; and all
action required to be taken for the due and proper authorization,
execution and delivery by it of this Agreement and the consummation
by it of the sale of the Shares contemplated hereby has been duly
and validly taken.
(l) Underwriting Agreement.
This Agreement has been duly authorized, executed and delivered by
the Company.
(m) The Shares. The Shares to
be issued and sold by the Company hereunder have been duly
authorized and, when issued and delivered and paid for as provided
herein, will be duly and validly issued, will be fully paid and
nonassessable and will conform in all material respects to the
descriptions thereof in the Registration Statement, the Pricing
Disclosure Package and the Prospectus; and the issuance of the
Shares is not subject to any preemptive or similar
rights.
(n) The Escrow Agreement. The
escrow securities account agreement by and among the Company and
U.S. Bank National Association, as Escrow Agent (the “Escrow
Agent”), to be dated as of the Closing Date (the
“Escrow Agreement”), has been duly authorized by the
Company and, when executed and delivered by the Company, will
constitute a legal, valid and binding instrument enforceable
against the Company in accordance with its terms, subject, as to
enforcement, to bankruptcy, insolvency, reorganization and other
laws of general applicability relating to or affecting
creditors’ rights and to general equity principles; the
Escrow Agreement will conform in all material respects to the
description thereof in the Pricing Disclosure Package and the
Prospectus.
(o) No Violation or Default.
Neither the Company nor any of its subsidiaries is (i) in
violation of its charter or by-laws or similar organizational
documents; (ii) in default, and no event has occurred that,
with notice or lapse of time or both, would constitute such a
default, in the performance or observance of any term, covenant or
condition contained in 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; or
(iii) in violation of any applicable law or statute or any
applicable judgment, order, rule or regulation of any court or
governmental or regulatory authority, except, in the case of
clauses (ii) and (iii) above, for any such default or
violation that would not, individually or in the aggregate, have a
Material Adverse Effect.
(p) No Conflicts. The
execution, delivery and performance by the Company of the Escrow
Agreement, the issuance and sale of the Shares and the consummation
of the transactions herein will not (i) conflict with or
result in a breach or violation of any of the terms or provisions
of, or constitute a default under, or result in the creation or
imposition of any lien, charge or encumbrance upon any property or
assets of the Company or any of its subsidiaries pursuant to, 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, (ii) result
in any violation of the provisions of the charter or by-laws or
similar organizational documents of the Company or any of its
subsidiaries or (iii) result in the violation of any
applicable law or statute or any applicable judgment, order, rule
or regulation of any court or governmental or regulatory authority,
except, in the case of clauses (i) and (iii) above, for
any such conflict, breach, violation, default, lien, charge or
encumbrance that would not, individually or in the aggregate, have
a Material Adverse Effect.
(q) No Consents Required. No
consent, approval, authorization, order, license, registration or
qualification of or with any court or governmental or regulatory
authority is required for the execution, delivery and performance
by the Company of this Agreement, the issuance and sale of the
Shares and the consummation of the transactions contemplated,
except for those which have been obtained, for the registration of
the Shares under the Securities Act, listing of
the Shares on the New York Stock
Exchange and such consents, approvals, authorizations, orders and
registrations or qualifications as may be required by the Financial
Industry Regulatory Authority, Inc. (“FINRA”) and under
applicable state securities laws in connection with the purchase
and distribution of the Shares by the Underwriters.
(r) Legal Proceedings. Except
as described in the Registration Statement, the Pricing Disclosure
Package and the Prospectus, there are no legal, governmental or
regulatory investigations (as to which the Company has been given
notice), actions, suits or proceedings pending to which the Company
or any of its subsidiaries is a party or to which any property of
the Company or any of its subsidiaries is subject that,
individually or in the aggregate, if determined adversely to the
Company or any of its subsidiaries, could reasonably be expected to
have a Material Adverse Effect; no such investigations (without
giving effect to the notice qualifier set forth above), actions,
suits or proceedings are, to the knowledge of the Company,
threatened or contemplated; and (i) there are no current or
pending legal, governmental or regulatory actions, suits or
proceedings that are required under the Securities Act to be
described in the Registration Statement, the Pricing Disclosure
Package or the Prospectus that are not so described in the
Registration Statement, the Pricing Disclosure Package and the
Prospectus and (ii) there are no statutes, regulations or
contracts or other documents that are required under the Securities
Act to be filed as exhibits to the Registration Statement or
described in the Registration Statement, the Pricing Disclosure
Package or the Prospectus that are not so filed as exhibits to the
Registration Statement or described in the Registration Statement,
the Pricing Disclosure Package and the Prospectus.
(s) Independent Accountants .
Ernst and Young LLP and Deloitte & Touche LLP, who have
certified certain financial statements of the Company and its
subsidiaries are or were independent registered public accounting
firms with respect to the Company and its subsidiaries within the
applicable rules and regulations adopted by the Commission and the
Public Company Accounting Oversight Board (United States) and as
required by the Securities Act.
(t) Title to Real and Personal
Property . The Company and its subsidiaries have good and
marketable title in fee simple (in the case of real property) to,
or have valid and marketable rights to lease or otherwise use, all
items of real and personal property and assets that are material to
the respective businesses of the Company and its subsidiaries, in
each case free and clear of all liens, encumbrances, claims and
defects and imperfections of title except those that (i) do
not materially interfere with the use made and proposed to be made
of such property by the Company and its subsidiaries,
(ii) would not, individually or in the aggregate, have a
Material Adverse Effect or (iii) are described in the
Registration Statement, Pricing Disclosure Package and
Prospectus.
(u) Title to Intellectual
Property . The Company and its subsidiaries own or possess
adequate rights to use all material patents, patent applications,
trademarks, service marks, trade names, trademark registrations,
service mark registrations, copyrights, licenses and know-how
(including trade secrets and other unpatented and/or unpatentable
proprietary or confidential information, systems or procedures)
necessary for the conduct of their respective businesses as
currently conducted and as currently proposed to be conducted
except as would not reasonably be expected to have a Material
Adverse Effect. The conduct of the respective businesses of the
Company and its subsidiaries will not conflict with any of the
foregoing rights of others except as would not, individually or in
the aggregate, have a Material Adverse Effect. Neither the Company
nor its subsidiaries has received a notice of infringement with
respect any of these rights. The Company and its subsidiaries have
not received any notice of any claim of infringement,
misappropriation or conflict with
any such rights of others in connection with its patents, patent
rights, licenses, inventions, trademarks, service marks, trade
names, copyrights and know-how, which could reasonably be expected,
individually or in the aggregate, to result in a Material Adverse
Effect.
(v) No Undisclosed
Relationships . No relationship, direct or indirect, exists
between or among the Company or any of its subsidiaries, on the one
hand, and the directors, officers, stockholders, customers or
suppliers of the Company or any of its subsidiaries, on the other,
that is required by the Securities Act to be described in the
Registration Statement, the Pricing Disclosure Package and the
Prospectus and that is not so described in such
documents.
(w) Investment Company Act .
The Company is not and, after giving effect to the offering and
sale of the Shares and the application of the proceeds thereof as
described in the Registration Statement, the Pricing Disclosure
Package and the Prospectus, will not be required to register as an
“investment company” or an entity
“controlled” by an “investment company”
within the meaning of the Investment Company Act of 1940, as
amended, and the rules and regulations of the Commission thereunder
(collectively, the “Investment Company
Act”).
(x) Taxes. The Company and
its subsidiaries have paid all federal, state, local and foreign
taxes and filed (taking into account applicable extensions) all tax
returns required to be paid or filed through the date hereof
(except those being disputed in good faith and for which adequate
reserve has been established and maintained); and except as
otherwise disclosed in the Registration Statement, the Pricing
Disclosure Package and the Prospectus, there is no material tax
deficiency that has been, or could reasonably be expected to be,
asserted against the Company or any of its subsidiaries or any of
their respective properties or assets.
(y) Licenses and Permits. The
Company and its subsidiaries possess all licenses, certificates,
permits and other authorizations issued by, and have made all
declarations and filings with, the appropriate federal, state,
local or foreign governmental or regulatory authorities that are
necessary for the ownership or lease of their respective properties
or the conduct of their respective businesses as described in the
Registration Statement, the Pricing Disclosure Package and the
Prospectus, except where the failure to possess or make the same
would not, individually or in the aggregate, have a Material
Adverse Effect; and except as described in the Registration
Statement, the Pricing Disclosure Package and the Prospectus,
neither the Company nor any of its subsidiaries has received notice
of any revocation or modification of any such license, certificate,
permit or authorization or has any reason to believe that any such
license, certificate, permit or authorization will not be renewed
in the ordinary course except where any such revocation,
modification or non-renewal would not, individually or in the
aggregate, have a Material Adverse Effect.
(z) No Labor Disputes. No
labor disturbance by or dispute with employees of the Company or
any of its subsidiaries exists or, to the knowledge of the Company,
is contemplated or threatened, and the Company is not aware of any
existing or imminent labor disturbance by, or dispute with, the
employees of any of its or its subsidiaries’ principal
suppliers or contractors, except as would not, individually or in
the aggregate, have a Material Adverse Effect.
(aa) Environmental Matters.
Except as described in the Registration Statement, the Pricing
Disclosure Package and the Prospectus and except for matters that
would not, individually or in the aggregate, have a Material
Adverse Effect, (i) the Company and its subsidiaries
(a) are in compliance with any and all applicable federal,
state, local and foreign laws, rules, regulations,
requirements, decisions, judgments,
decrees, orders and the common law relating to pollution or the
protection of the environment, natural resources or human health or
safety, including those relating to the generation, storage,
treatment, use, handling, transportation, Release or threat of
Release of Hazardous Materials (collectively, “Environmental
Laws”), (b) have received and are in compliance with all
permits, licenses, certificates or other authorizations or
approvals required of them under applicable Environmental Laws to
conduct their respective businesses, (c) have not received
notice of any actual or potential liability under or relating to,
or actual or potential violation of, any Environmental Laws,
including for the investigation or remediation of any Release or
threat of Release of Hazardous Materials, and have no knowledge of
any event or condition that would reasonably be expected to result
in any such notice and (d) are not a party to any order,
decree or agreement that imposes any obligation or liability under
any Environmental Law; (ii) there are no costs or liabilities
associated with Environmental Laws of or relating to the Company or
its subsidiaries; (iii) there are no proceedings that are
pending, or that are known to be contemplated, against the Company
or any of its subsidiaries under any Environmental Laws in which a
governmental entity is also a party; (iv) the Company and its
subsidiaries are not aware of any facts or issues regarding
compliance with Environmental Laws, or liabilities or other
obligations under Environmental Laws, including the Release or
threat of Release of Hazardous Materials; and (v) none of the
Company and its subsidiaries anticipates capital expenditures
relating to any Environmental Laws; and (vi) there has been no
storage, generation, transportation, use, handling, treatment,
Release or threat of Release of Hazardous Materials by, relating to
or caused by the Company or any of its subsidiaries (or, to the
knowledge of the Company and its subsidiaries, any other entity
(including any predecessor) for whose acts or omissions the Company
or any of its subsidiaries is or could reasonably be expected to be
liable) at, on, under or from (A) any property or facility now
or previously owned, operated or leased by the Company or any of
its subsidiaries or (B) any other property or facility, in
each case in violation of any Environmental Laws or in a manner or
amount or to a location that could reasonably be expected,
individually or in the aggregate, to result in liability under any
Environmental Law. “Hazardous Materials” means any
material, chemical, substance, waste, pollutant, contaminant,
compound, mixture, or constituent thereof, in any form or amount,
including petroleum (including crude oil or any fraction thereof)
and petroleum products, natural gas liquids, asbestos and asbestos
containing materials, naturally occurring radioactive materials,
brine, and
