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EXHIBIT 1.2
VALERO ENERGY CORPORATION
DEBT SECURITIES
Underwriting Agreement
June __, 2000
To the Representatives named in
Schedule I hereto of the
Underwriters named in Schedule II
hereto
Ladies and Gentlemen:
Valero Energy Corporation, a Delaware corporation (the "COMPANY"),
proposes to issue and sell to the underwriters named in Schedule II hereto (the
"UNDERWRITERS"), for whom you are acting as representatives (the
"REPRESENTATIVES"), the principal amount of its debt securities identified in
Schedule I hereto (the "SECURITIES"), to be issued under the indenture
specified in Schedule I hereto (the "INDENTURE") between the Company and the
Trustee identified in such Schedule (the "TRUSTEE"). If the firm or firms
listed in Schedule II hereto include only the firm or firms listed in Schedule
I hereto, then the terms "Underwriters" and "Representatives," as used herein,
shall each be deemed to refer to such firm or firms.
The Company has prepared and filed with the Securities and Exchange
Commission (the "COMMISSION") in accordance with the provisions of Securities
Act of 1933, as amended, and the rules and regulations of the Commission
thereunder (collectively, the "SECURITIES ACT"), a registration statement (the
file number of which is set forth in Schedule I hereto) on Form S-3, relating
to certain debt securities (the "SHELF SECURITIES") to be issued from time to
time by the Company. The Company also has filed with, or proposes to file with,
the Commission pursuant to Rule 424 under the Securities Act a prospectus
supplement specifically relating to the Securities. The registration statement
as amended to the date of this Agreement is hereinafter referred to as the
"REGISTRATION STATEMENT" and the related prospectus covering the Shelf
Securities in the form first used to confirm sales of the Securities is
hereinafter referred to as the "BASIC PROSPECTUS". The Basic Prospectus as
supplemented by
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the prospectus supplement specifically relating to the Securities in the form
first used to confirm sales of the Securities is hereinafter referred to as the
"PROSPECTUS". If the Company has filed an abbreviated registration statement
pursuant to Rule 462(b) under the Securities Act (the "RULE 462 REGISTRATION
STATEMENT"), then any reference herein to the term "Registration Statement"
shall be deemed to include such Rule 462 Registration Statement. Any reference
in this Agreement to the Registration Statement, the Basic Prospectus, any
preliminary form of prospectus (a "PRELIMINARY PROSPECTUS") previously filed
with the Commission pursuant to Rule 424 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 which were filed under the
Securities Exchange Act of 1934, as amended, and the rules and regulations of
the Commission thereunder (collectively, the "EXCHANGE ACT") on or before the
date of this Agreement or the date of the Basic Prospectus, any preliminary
prospectus or the Prospectus, as the case may be; and any reference to "amend",
"amendment" or "supplement" with respect to the Registration Statement, the
Basic Prospectus, any preliminary prospectus or the Prospectus shall be deemed
to refer to and include any documents filed under the Exchange Act after the
date of this Agreement, or the date of the Basic Prospectus, any preliminary
prospectus or the Prospectus, as the case may be, which are deemed to be
incorporated by reference therein.
Concurrently with the offering of the Securities, the Company intends
to offer an aggregate of 5,000,000 shares of its common stock (the "SHARES")
and $150,000,000 aggregate stated amount of Premium Equity Participating
Security Units (the "PEPS UNITS"). The offerings of the Shares and PEPS Units
are referred to herein as the "EQUITY OFFERING" and "PEPS UNITS OFFERING,"
respectively.
It is understood that on March 2, 2000, the Company entered into an
agreement, as amended on May 14, 2000 (the "PURCHASE AGREEMENT") with
ExxonMobil Corporation ("EXXONMOBIL") to purchase ExxonMobil's refinery and
truck terminal located in Benicia, California and all Exxon-branded California
retail assets (the "ACQUISITION"). It is also understood that the closing of
the purchase of the refinery and certain of the retail assets took place on May
15, 2000 and that the closing of the purchase of the remaining retail assets
took place on June 15, 2000.
The Company hereby agrees with the Underwriters as follows:
1. The Company agrees to issue and sell the Securities to the several
Underwriters as hereinafter provided, and each Underwriter, on the basis of the
representations and warranties herein contained, but subject to the conditions
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hereinafter stated, agrees to purchase, severally and not jointly, from the
Company the respective principal amount of Securities set forth opposite such
Underwriter's name in Schedule II hereto at the purchase price set forth in
Schedule I hereto plus accrued interest, if any, from the date specified in
Schedule I hereto to the date of payment and delivery.
2. The Company understands that the several Underwriters intend (i)
to make a public offering of their respective portions of the Securities and
(ii) initially to offer the Securities upon the terms set forth in the
Prospectus.
3. Payment for the Securities shall be made by wire transfer in
immediately available funds to the account specified by the Company to the
Representatives, no later than noon the Business Day (as defined below) prior
to the Closing Date (as defined below), on the date and at the time and place
set forth in Schedule I hereto (or at such other time and place on the same or
such other date, not later than the fifth Business Day (as defined below)
thereafter, as you and the Company may agree in writing). As used herein, the
term "BUSINESS DAY" means any day other than a day on which banks are permitted
or required to be closed in New York City. The time and date of such payment
and delivery with respect to the Securities are referred to herein as the
"CLOSING DATE".
Payment for the Securities shall be made against delivery to the
nominee of The Depository Trust Company for the respective accounts of the
several Underwriters of the Securities of one or more global notes (the "GLOBAL
NOTE") representing the Securities, with any transfer taxes payable in
connection with the transfer to the Underwriters of the Securities duly paid by
the Company. The Global Note will be made available for inspection by the
Representatives at such place as the Representatives and the Company shall
agree not later than 1:00 P.M., New York City time, on the Business Day prior
to the Closing Date.
4. The Company represents and warrants to and agrees with each of the
Underwriters that:
(a) The Registration Statement has become effective; no stop
order suspending the effectiveness of the Registration Statement is in
effect, and no proceedings for such purpose are pending before or
threatened by the Commission.
(b) (i) Each document, if any, filed or to be filed pursuant
to the Exchange Act and incorporated by reference in the Prospectus
complied or will comply when so filed in all material respects with
the Exchange Act and the applicable rules and regulations of the
Commission thereunder, (ii) the Registration Statement, when it became
effective, did not contain and,
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as amended or supplemented, if applicable, 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 not misleading, (iii) the Registration Statement and the
Prospectus comply and, as amended or supplemented, if applicable, will
comply in all material respects with the Securities Act and the Trust
Indenture Act of 1939, as amended, and the applicable rules and
regulations of the Commission thereunder and (iv) the Prospectus does
not contain and, as amended or supplemented, if applicable, will not
contain any untrue statement of a material fact or omit to state a
material fact necessary to make the statements therein, in the light
of the circumstances under which they were made, not misleading,
except that the representations and warranties set forth in this
paragraph do not apply to (i) that part of the Registration Statement
which constitutes the Statement of Eligibility and Qualification (Form
T-1) under the Trust Indenture Act of the Trustee, and (ii) statements
or omissions in the Registration Statement or the Prospectus based
upon information relating to any Underwriter furnished to the Company
in writing by such Underwriter or its counsel through you expressly
for use therein.
(c) The Company (i) has been duly incorporated, is validly
existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, (ii) has the corporate power and
authority to own its property and to conduct its business as described
in the Prospectus and (iii) is duly qualified to transact business and
is in good standing in each jurisdiction in which the conduct of its
business or its ownership or leasing of property requires such
qualification, except to the extent that the failure to be so
qualified or be in good standing would not have a material adverse
effect on the Company and its subsidiaries, taken as a whole.
(d) Each subsidiary of the Company (i) has been duly
incorporated, is validly existing as a corporation in good standing
under the laws of the jurisdiction of its incorporation, (ii) has the
corporate power and authority to own its property and to conduct its
business as described in the Prospectus and is duly qualified to
transact business and (iii) is in good standing in each jurisdiction
in which the conduct of its business or its ownership or leasing of
property requires such qualification, except to the extent that the
failure to be so qualified or be in good standing would not have a
material adverse effect on the Company and its subsidiaries, taken as
a whole; all of the issued shares of capital stock of each subsidiary
of the Company have been duly and validly authorized and issued, are
fully paid and non-assessable and are owned directly or
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indirectly by the Company, free and clear of all liens, encumbrances,
equities or claims.
(e) This Agreement has been duly authorized, executed and
delivered by the Company.
(f) The Purchase Agreement has been duly authorized, executed
and delivered by, and constitutes a valid and binding obligation of,
the Company and, to the knowledge of the Company, ExxonMobil; the
Purchase Agreement is in full force and effect as of the date hereof
and neither the Company, nor, to the knowledge of the Company,
ExxonMobil, is, or with the giving of notice or lapse of time or both
would be, in violation of or in default under the Purchase Agreement,
except for violations and defaults which individually or in the
aggregate would not be material to the Company and its subsidiaries,
taken as a whole.
(g) The authorized capital stock of the Company conforms as
to legal matters to the description thereof contained in the
Prospectus.
(h) The Securities have been duly authorized, and, when
issued and delivered pursuant to this Agreement, will have been duly
executed, authenticated, issued and delivered and will constitute
valid and binding obligations of the Company entitled to the benefits
provided by the Indenture; the Indenture has been duly authorized,
executed and delivered by the Company and is duly qualified under the
Trust Indenture Act and constitutes a valid and binding instrument,
enforceable in accordance with its terms, except as the enforceability
thereof is subject to the effect of (i) bankruptcy, insolvency,
reorganization, moratorium, fraudulent conveyance or other laws
relating to or affecting creditors' rights generally and (ii) general
principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law); the Securities and
the Indenture will conform to the descriptions thereof in the
Prospectus.
(i) The execution and delivery by the Company of, and the
performance by the Company of its obligations under, this Agreement,
the Purchase Agreement, the Indenture and the Securities will not
contravene any provision of applicable law or the certificate of
incorporation or by-laws of the Company or any agreement, indenture or
instrument binding upon the Company or any of its subsidiaries that is
material to the Company and its subsidiaries, taken as a whole, or any
judgment, order or decree of any governmental body, agency or court
having jurisdiction over the Company or any subsidiary, and no
consent, approval, authorization or
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order of, or qualification with, any governmental body or agency that
has not already been obtained is required for the performance by the
Company of its obligations under this Agreement, the Purchase
Agreement, the Indenture or the Securities, except such as may be
required by the securities or Blue Sky laws of the various states in
connection with the offer and sale of the Securities.
(j) Neither the Company nor any of its subsidiaries is in
violation of its corporate charter or by-laws or other constitutive
document or in default under any agreement, indenture or instrument,
which default could reasonably be expected to have a material adverse
effect on the business, properties, financial condition or results of
operations of the Company and its subsidiaries, taken as a whole, and
no event or condition has occurred or exists which, with the giving of
notice or the lapse of time or both, would result in any such
violation or default which would have such an effect. Neither the
Company nor any of its subsidiaries is in violation of any law,
ordinance, governmental rule or regulation or court decree to which it
may be subject, which violation could reasonably be expected to have a
material adverse effect on the business, properties, financial
condition or results of operations of the Company and its
subsidiaries, taken as a whole.
(k) There has not occurred any material adverse change, or
any development involving a prospective material adverse change in the
condition, financial or otherwise, or in the earnings, business or
operations of the Company and its subsidiaries, taken as a whole, from
that set forth in the Prospectus (exclusive of any amendments or
supplements thereto subsequent to the date of this Agreement).
(l) There are no legal or governmental investigations or
proceedings pending or threatened to which the Company or any of its
subsidiaries is a party or to which any of the properties of the
Company or any of its subsidiaries is subject, that are required to be
described in the Registration Statement or the Prospectus and are not
so described or any statutes, regulations, contracts or other
documents that are required to be described in the Registration
Statement or the Prospectus or to be filed as exhibits to the
Registration Statement that are not described or filed as required.
(m) Each preliminary prospectus filed as part of the
registration statement as originally filed or as part of any amendment
thereto, or filed pursuant to Rule 424 under the Securities Act,
complied when so filed in
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all material respects with the Securities Act and the applicable rules
and regulations of the Commission thereunder.
(n) The Company is not, and after giving effect to the
offering and sale of the Securities and the application of the
proceeds thereof as described in the Prospectus will not be, required
to register as an "investment company" as such term is defined in the
Investment Company Act of 1940, as amended.
(o) All licenses, permits, consents, certificates of need,
authorizations, certifications, accreditations, franchises, approvals,
grants of rights by, or filings or registrations with, any federal,
state, local or foreign court or governmental or public body,
authority, or other instrumentality or third person (including without
limitation the Federal Energy Regulatory Commission ("FERC")) (any of
the foregoing a "LICENSE") necessary for the Company and its
subsidiaries to own, build, maintain or operate their respective
businesses or properties have been duly authorized and obtained, and
are in full force and effect, except where the failure to so be
obtained or in effect would not, individually or in the aggregate,
have a material adverse effect on the Company and its subsidiaries,
taken as a whole; and the Company and its subsidiaries are in
compliance in all material respects with all provisions thereof; no
event has occurred which permits (or with the passage of time would
permit) the revocation or termination of any License, or which could
result in the imposition of any restriction thereon, which is of such
a nature or the effect of which would reasonably be expected to have a
material adverse effect on the Company and its subsidiaries, taken as
a whole; no material License is the subject of any pending or, to the
best of the Company's knowledge, threatened challenge or revocation
which, if such License were revoked, would reasonably be expected to
have a material adverse effect on the Company and its subsidiaries,
taken as a whole; the Company and its subsidiaries are required to
obtain any material License that has not already been obtained from,
or effect any material filing or registration that has not already
been effected with, the FERC or any other federal, state or local
regulatory authority in connection with the execution and delivery of
this Agreement, the Purchase Agreement, the Indenture or the
Securities; and except, in each case, as described in the Prospectus
(exclusive of any amendments or supplements thereto subsequent to the
date of this Agreement).
(p) 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
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environment or hazardous or toxic substances or wastes, pollutants or
contaminants ("ENVIRONMENTAL LAWS"), (ii) have received all permits,
licenses or other approvals required of them under applicable
Environmental Laws to conduct their respective businesses and (iii)
are in compliance with all terms and conditions of any such permit,
license or approval, except where such noncompliance with
Environmental Laws, failure to receive required permits, licenses or
other approvals or failure to comply with the terms and conditions of
such permits, licenses or approvals would not, singly or in the
aggregate, have a material adverse effect on the Company and its
subsidiaries, taken as a whole; and except, in each case, as described
in the Prospectus (exclusive of any amendments or supplements thereto
subsequent to the date of this Agreement).
(q) Except as described in the Prospectus (exclusive of any
amendments or supplements thereto subsequent to the date of this
Agreement), there are no costs or liabilities associated with
Environmental Laws (including, without limitation, any capital or
operating expenditures required for clean-up, closure of properties or
compliance with Environmental Laws or any permit, license or approval,
any related constraints on operating activities and any potential
liabilities to third parties) which would, singly or in the aggregate,
have a material adverse effect on the Company and its subsidiaries,
taken as a whole.
(r) The statements, (including the assumptions described
therein) included in the Company's filing on Form 8-K dated as of
March 17, 2000 (i) are within the coverage of Rule 175(b) under the
Act to the extent such data constitute forward looking statements as
defined in Rule 175(c) and (ii) were made by the Company with a
reasonable basis and reflect the Company's good faith estimate of the
matters described above.
(s) The Company has prepared its financial statements on a
consistent basis in accordance with generally accepted accounting
principles. The pro forma financial statements of the Company, and the
related notes thereto, included in the Prospectus present fairly in
all material respects the pro forma financial position of the Company,
as of the dates indicated and the results of its operations for the
periods specified; the pro forma financial information, and the
related notes thereto, included in the Prospectus has been prepared in
accordance with the applicable requirements of the Exchange Act and is
based upon good faith estimates and assumptions believed by the
Company to be reasonable.
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(t) Neither the Company nor any of its subsidiaries is a
"holding company", a "subsidiary company" or a "holding company", an
"affiliate" of a "holding company" or of a "subsidiary company" of a
"holding company", or a "public utility", as each of such terms is
defined in the Public Utility Holding Company Act of 1935, as amended,
and the rules and regulations thereunder.
(u) The Company and its subsidiaries have good and
indefeasible title to all items of real property and good and
defensible title to all personal property owned by them and the right
to use all other property used or proposed to be used by them in the
ordinary course of business, in each case free and clear of all liens,
encumbrances and defects except such as are described or referred to
in the Prospectus or such as do not materially adversely affect the
value of such property and do not unreasonably interfere with the use
made or proposed to be made of such property by the Company and its
subsidiaries; and any real property and buildings held under lease by
the Company and its subsidiaries are held by them under valid,
existing and enforceable leases with such exceptions as are not
material and do not unreasonably interfere with the use made or
proposed to be made of such property and buildings by the Company or
its subsidiaries.
(v) Immediately after any sale of Securities by the Company
hereunder, the aggregate amount of Securities which have been issued
and sold by the Company hereunder and of any securities of the Company
(other than the Securities) that shall have been issued and sold
pursuant to the Registration Statement will not exceed the amount of
securities registered under the Registration Statement;
5. The Company covenants and agrees with each of the several
Underwriters as follows:
(a) to file the Prospectus in a form approved by you pursuant
to Rule 424 under the Securities Act not later than the Commission's
close of business on the second Business Day following the date of
determination of the offering price of the Securities or, if
applicable, such earlier time as may be required by Rule 424(b);
(b) to furnish to you, without charge, 5 conformed copies of
the Registration Statement (including exhibits thereto) and for
delivery to each other Underwriter a conformed copy of the
Registration Statement (without exhibits thereto) and to furnish to
you in New York City, without charge, prior to 10:00 a.m. New York
City time on the business day next
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succeeding the date of this Agreement and during the period mentioned
in Section 5(e) below, as many copies of the Prospectus and any
supplements and amendments thereto or to the Registration Statement as
you may reasonably request;
(c) from the date hereof and prior to the Closing Date, to
furnish to you a copy of any proposed amendment or supplement to the
Registration Statement or the Prospectus, for your review, and not to
file any such proposed amendment or supplement to which you reasonably
object;
(d) to file promptly all reports and any definitive proxy or
information statements required to be filed by the Company with the
Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the
Exchange Act for so long as the delivery of a prospectus is required
in connection with the offering or sale of the Securities, and during
such same period, to advise you promptly, and to confirm such advice
in writing, (i) when any amendment to the Registration Statement shall
have become effective, (ii) of any request by the Commission for any
amendment to the Registration Statement or any amendment or supplement
to the Prospectus or for any additional information, (iii) of the
issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or the initiation or
threatening of any proceeding for that purpose, and (iv) of the
receipt by the Company of any notification with respect to any
suspension of the qualification of the Securities for offer and sale
in any jurisdiction or the initiation or threatening of any proceeding
for such purpose; and to use its best efforts to prevent the issuance
of any such stop order or notification and, if issued, to obtain as
soon as possible the withdrawal thereof;
(e) if, during such period after the first date of the public
offering of the Securities as in the opinion of counsel for the
Underwriters a prospectus relating to the Securities is required by
law to be delivered in connection with sales by an Underwriter or
dealer, any event shall occur as a result of which it is necessary to
amend or supplement the Prospectus in order to make the statements
therein, in the light of the circumstances when the Prospectus is
delivered to a purchaser, not misleading, or if it is necessary to
amend or supplement the Prospectus to comply with law, forthwith to
prepare and furnish, at the expense of the Company, to the
Underwriters and to the dealers (whose names and addresses you will
furnish to the Company) to which Securities may have been sold by you
on behalf of the Underwriters and to any other dealers upon request,
such amendments or supplements to the Prospectus as may be necessary
so that
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the statements in the Prospectus as so amended or supplemented will
not, in the light of the circumstances when the Prospectus is
delivered to a purchaser, be misleading or so that the Prospectus will
comply with law;
(f) To endeavor to qualify the Securities for offer and sale
under the securities or Blue Sky laws of such jurisdictions as you
shall reasonably request and to continue such qualification in effect
so long as reasonably required for distribution of the Securities;
(g) to make generally available to the Company's security
holders and to you as soon as practicable an earning statement
covering the twelve-month period ending June 30, 2001 that satisfies
the provisions of Section 11(a) of the Securities Act and the rules
and regulations of the Commission thereunder;
(h) during the period beginning on the date hereof and
continuing to and including the Business Day following the Closing
Date, not to offer, sell, contract to sell or otherwise dispose of any
debt securities of or guaranteed by the Company which are
substantially similar to the Securities;
(i) to use the net proceeds received by the Company from the
sale of the Securities pursuant to this Agreement in the manner
specified in the Prospectus under the caption "Use of Proceeds";
(j) whether or not the transactions contemplated in this
Agreement are consummated or this Agreement is terminated, to pay or
cause to be paid all costs and expenses incident to the performance of
its obligations hereunder, including without limiting the generality of
the foregoing, all costs and expenses (i) incident to the preparation,
issuance, execution, authentication and delivery of the Securities,
including any expenses of the Trustee, (ii) incident to the
preparation, printing and filing under the Securities Act of the
Registration Statement, the Prospectus and any preliminary prospectus
(including in each case all exhibits, amendments and supplements
thereto), (iii) incurred in connection with the registration or
qualification and determination of eligibility for investment of the
Securities under the laws of such jurisdictions as the Underwriters may
designate (including fees of counsel for the Underwriters and their
disbursements), (iv) related to any filing with National Association of
Securities Dealers, Inc., (v) in connection with the printing
(including word processing and duplication costs) and delivery of this
Agreement, the Indenture, the Preliminary and Supplemental Blue Sky
Memoranda and the furnishing to Underwriters and dealers of copies of
the Registration
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Statement and the Prospectus, including mailing and shipping, as
herein provided, (vi) payable to rating agencies in connection with
the rating of the Securities, (vii) any expenses incurred by the
Company in connection with a "road show" presentation to potential
investors and (viii) the cost and charges of any transfer agent.
6. The several obligations of the Underwriters hereunder shall be
subject to the following conditions:
(a) the representations and warranties of the Company
contained herein are true and correct on and as of the Closing Date as
if made on and as of the Closing Date and the Company shall have
complied with all agreements and all conditions on its part to be
performed or satisfied hereunder at or prior to the Closing Date;
(b) the Prospectus shall have been filed with the Commission
pursuant to Rule 424 within the applicable time period prescribed for
such filing by the rules and regulations under the Securities Act; no
stop order suspending the effectiveness of the Registration Statement
shall be in effect, and no proceedings for such purpose shall be
pending before or threatened by the Commission; and all requests for
additional information on the part of the Commission shall have been
complied with to your satisfaction;
(c) subsequent to the execution and delivery of this
Agreement and prior to the Closing Date, there shall not have occurred
any downgrading, nor shall any notice have been given of any intended
or potential downgrading or of any review for a possible change that
does not indicate an improvement in the rating accorded any of the
Company's securities by any "nationally recognized statistical rating
organization," as such term is defined for purposes of Rule 436(g)(2)
under the Securities Act;
(d) The Purchase Agreement shall be in full force and effect
and no amendment thereto shall have been entered into and none of the
conditions to closing set forth thereon shall have been waived (except
in either case prior to the date hereof, with your consent or such
thereof as would not be reasonably likely to have a material adverse
effect on the Company and its subsidiaries taken as a whole).
(e) the closings of the Equity Offering and the PEPS Units
Offering shall have occurred;
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(f) since the respective dates as of which information is
given in the Prospectus there shall not have been any change in the
capital stock or long-term debt of the Company or any of its
subsidiaries or any prospective material adverse change, or any
development involving a material adverse change, in or affecting the
general affairs, business, prospects, 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 Prospectus, the effect of which in the judgment of
the Representatives makes it impracticable or inadvisable to proceed
with the public offering or the delivery of the Securities on the
terms and in the manner contemplated in the Prospectus.
(g) the Representatives shall have received on and as of the
Closing Date a certificate of an executive officer of the Company,
with specific knowledge about the Company's financial matters,
satisfactory to you to the effect set forth in Sections 6(a), 6(b),
6(c), 6(d) and 6(e) (with respect to the respective representations,
warranties, agreements and conditions of the Company) and to the
further effect that there has not occurred any prospective material
adverse change, or any development involving a prospective material
adverse change, in or affecting the general affairs, business,
prospects, management, financial position, stockholders' equity or
results of operations of the Company and its subsidiaries, taken as a
whole, from that set forth or contemplated in the Registration
Statement.
(h) The Underwriters shall have received on the Closing Date
an opinion of Baker Botts L.L.P., outside counsel for the Company, to
the effect that:
(i) the Company has been duly incorporated, is
validly existing as a corporation in good standing under the
laws of the jurisdiction of its incorporation, has the
corporate power and authority to own its property and to
conduct its business as described in the Prospectus;
(ii) the authorized capital stock of the Company
conforms as to legal matters to the description thereof
contained in the Prospectus;
(iii) the Securities have been duly authorized and,
when issued and delivered by the Company and, when duly
authenticated in accordance with the terms of the Indenture
and delivered to and paid for by the Underwriters in
accordance with the terms of this
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Agreement, will constitute valid and binding obligations of
the Company entitled to the benefits provided by the
Indenture subject to the effect of (A) bankruptcy,
insolvency, reorganization, moratorium, fraudulent conveyance
or other laws relating to or affecting creditors' rights
generally and (B) general principles of equity (regardless of
whether such enforceability is considered in a proceeding in
equity or at law);
(iv) the Indenture has been duly authorized,
executed and delivered by the Company and constitutes a valid
and binding instrument of the Company subject to the effect
of (A) bankruptcy, insolvency, reorganization, moratorium,
fraudulent conveyance or other laws relating to or affecting
creditors' rights generally and (B) general principles of
equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law); and the
Indenture has been duly qualified under the Trust Indenture
Act;
(v) this Agreement has been duly authorized,
executed and delivered by the Company;
(vi) the Purchase Agreement has been duly
authorized, executed and delivered by the Company and
represents a valid and binding agreement of the Company,
enforceable in accordance with its terms, except as the
enforceability thereof is subject to the effect of (A)
bankruptcy, insolvency, reorganization, moratorium,
fraudulent conveyance or other laws relating to or affecting
creditors' rights generally and (B) general principles of
equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law);
(vii) the execution and delivery by the Company of,
and the performance by the Company of its obligations under,
this Agreement, the Purchase Agreement, the Indenture and the
Securities will not contravene any provision of applicable
law or the certificate of incorporation or by-laws of the
Company;
(viii) the statements (A) in the Basic Prospectus
under the caption "Description of the Debt Securities", (B)
in the Prospectus Supplement under the caption "Description
of the Notes", and (C) in the Registration Statement in Item
15, in each case insofar as such statements constitute
summaries of legal matters, accurately present the
information called for with respect to such legal
14
<PAGE> 15
matters, documents and proceedings and accurately summarize
the matters referred to therein; and
(x) the Company is not, and after giving effect to
the offering and sale of the Securities and the application
of the proceeds thereof as described in the Prospectus will
not be, required to register as an "investment company" as
such term is defined in the Investment Company Act of 1940,
as amended.
In addition, such counsel shall state that nothing has come
to such counsel's attention to cause such counsel to believe that (A)
the Registration Statement and Prospectus (except for financial
statements and schedules and other financial and statistical data
included therein as to which such counsel need not comment) do not
comply as to form in all material respects with the Securities Act and
the applicable rules and regulations of the Commission thereunder or
(B)(i) (except for financial statements and schedules and other
financial and statistical data as to which such counsel need not
express any belief) the Registration Statement and the prospectus
included therein at the time the Registration Statement became
effective or at the time of the execution of this Agreement 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 not misleading or (ii) (except for financial statements and
schedules and other financial and statistical data as to which such
counsel need not express any belief) the Prospectus contains any
untrue statement of a material fact or omits 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.
(i) The Underwriters shall have received on the Closing Date
an opinion of Jay D. Browning, Esq., Corporate Secretary and Managing
Attorney, Corporate Law for the Company, to the effect that:
(i) the Company is duly qualified to transact
business and is in good standing in each jurisdiction in
which the conduct of its business or its ownership or leasing
of property requires such qualification, except to the extent
that the failure to be so qualified or be in good standing
would not have a material adverse effect on the Company and
its subsidiaries, taken as a whole;
(ii) each subsidiary of the Company has been duly
incorporated, is validly existing as a corporation in good
standing under the laws of the jurisdiction of its
incorporation, has the
15
<PAGE> 16
corporate power and authority to own its property and to
conduct its business and is in good standing in each
jurisdiction in which the conduct of its business or its
ownership or leasing of property requires such qualification,
except to the extent that the failure to be so qualified or
be in good standing would not have a material adverse effect
on the Company and its subsidiaries, taken as a whole;
(iii) all of the issued shares of capital stock of
each subsidiary of 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 all liens, encumbrances, equities or claims;
(iv) the execution and delivery by the Company of,
and the performance by the Company of its obligations under,
this Agreement, the Purchase Agreement, the Indenture and the
Securities will not contravene any agreement, indenture or
instrument binding upon the Company or any of its
subsidiaries that is known to such counsel and material to
the Company and its subsidiaries, taken as a whole, or to the
best of such counsel's knowledge, any judgment, order or
decree of any governmental body, agency or court having
jurisdiction over the Company or any subsidiary, and no
consent, approval, authorization or order of, or
qualification with, any governmental body or agency that has
not already been obtained is required for the performance by
the Company of its obligations under this Agreement, the
Purchase Agreement, the Indenture or the Securities, except
such as may be required by the securities or Blue Sky laws of
the various states in connection with the offer and sale of
the Securities;
(v) the statements (A) in the Prospectus under the
captions "Summary-The Benicia Acquisition and Related
Financings," "The Benicia Acquisition and Related
Financings," "Business-Environmental Matters" and "-Legal
Proceedings" and "Risk Factors-Compliance with and changes in
environmental laws could adversely affect our performance"
and "-the outcome of the Unocal patent dispute may adversely
affect our business," (B) in the Registration Statement in
Item 15 and (C) incorporated by reference into the Prospectus
under the captions (i) "Item 1-Business-Environmental Matters
and "Item 2-Legal Proceedings" in the Company's Annual Report
on Form 10-K for the year ended December 31, 1999 and (ii)
"Item 1-Legal
16
<PAGE> 17
Proceedings" in the Company's quarterly report on Form 10-Q
for the quarter ended March 31, 2000, in each case insofar as
such statements constitute summaries of legal matters,
accurately present the information called for with respect to
such legal matters, documents and proceedings and accurately
summarize the matters referred to therein;
(vi) after due inquiry, such counsel does not know
of any legal or governmental investigations or proceedings
pending or threatened to which the Company or any of its
subsidiaries is a party or to which any of the properties of
the Company or any of its subsidiaries is subject that are
required to be described in the Registration Statement or the
Prospectus and are not so described or of any statutes,
regulations, contracts or other documents that are required
to be described in the Registration Statement or the
Prospectus or to be filed as exhibits to the Registration
Statement that are not described or filed as required;
(vii) nothing has come to such counsel's attention
to cause such counsel to believe that the Company and its
subsidiaries (A) are not in compliance with any and all
applicable Environmental Laws, (B) have not received all
permits, licenses or other approvals required of them under
applicable Environmental Laws to conduct their respective
businesses or (C) are not in compliance with all terms and
conditions of any such permit, license or approval, except
where such noncompliance with Environmental Laws, failure to
receive required permits, licenses or other approvals or
failure to comply with the terms and conditions of such
permits, licenses or approvals would not, singly or in the
aggregate, have a material adverse effect on the Company and
its subsidiaries, taken as a whole; and
(viii) the documents incorporated by reference in
the Prospectus (except for the consolidated financial
statements and other financial or statistical data included
therein or omitted therefrom, as to which such counsel need
express no opinion), as of the dates they were filed with the
Commission or to the extent such documents were subsequently
amended prior to the date hereof, at the time so amended,
complied as to form in all material respects with the
requirements of the Exchange Act and the regulations
thereunder.
17
<PAGE> 18
In addition, such counsel shall state that nothing has come
to such counsel's attention to cause such counsel to believe that (A)
the Registration Statement and Prospectus (except for financial
statements and schedules and other financial and statistical data
included therein as to which such counsel need not comment) do not
comply as to form in all material respects with the Securities Act and
the applicable rules and regulations of the Commission thereunder or
(B)(i) (except for financial statements and schedules and other
financial and statistical data as to which such counsel need not
express any belief) the Registration Statement and the prospectus
included therein at the time the Registration Statement became
effective or at the time of the execution of this Agreement 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 not misleading or (ii) (except for financial statements and
schedules and other financial and statistical data as to which such
counsel need not express any belief) the Prospectus contains any
untrue statement of a material fact or omits 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.
The opinions of Baker Botts L.L.P. and Jay D. Browning, Esq.
referred to in paragraphs 6(h) and 6(i) above shall be rendered to the
Underwriters at the request of the Company and shall so state therein.
(j) on the date hereof and on the Closing Date, (i) Arthur
Andersen LLP (with respect to the financial statements of the Company)
and (ii) PricewaterhouseCoopers (with respect to the financial
statements of the assets acquired pursuant to the Acquisition) shall
have furnished to you letters, dated such date, in form and substance
satisfactory to you, containing statements and information of the type
customarily included in accountants "comfort letters" to underwriters
with respect to the financial statements and certain financial
information contained in the Registration Statement and the
Prospectus; and
(k) you shall have received on and as of the Closing Date an
opinion of Davis Polk & Wardwell, counsel to the Underwriters, in form
and substance satisfactory to you.
7. The Company agrees to indemnify and hold harmless each
Underwriter, each affiliate of any Underwriter which assists such Underwriter
in the distribution of the Securities and each person, if any, who controls any
Underwriter within the meaning of either Section 15 of the Securities Act or
Section 20 of the Exchange Act, from and against any and all losses, claims,
18
<PAGE> 19
damages and liabilities (including without limitation the legal fees and other
expenses reasonably incurred in connection with any suit, action or proceeding
or any claim asserted) caused by any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement or the
Prospectus (as amended or supplemented if the Company shall have furnished any
amendments or supplements thereto) or any preliminary prospectus, or caused by
any omission or alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein not misleading,
except insofar as such losses, claims, damages or liabilities are caused by any
untrue statement or omission or alleged untrue statement or omission 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 therein; provided, however, that the
foregoing indemnity agreement with respect to any preliminary prospectus shall
not inure to the benefit of any Underwriter from whom the person asserting any
such losses, claims, damages or liabilities purchased Securities, or any person
controlling such Underwriter, if a copy of the Prospectus (as then amended or
supplemented if the Company shall have furnished any amendments or supplements
thereto) was not sent or given by or on behalf of such Underwriter to such
person, if required by law so to have been delivered, at or prior to the
written confirmation of the sale of the Securities to such person, and if the
Prospectus (as so amended or supplemented) would have cured the defect giving
rise to such losses, claims, damages or liabilities, unless such failure is the
result of noncompliance by the Company with Section 5(b) hereof.
Each Underwriter agrees, severally and not jointly, to indemnify and
hold harmless the Company, its directors, its officers who sign the
Registration Statement and each person who controls the Company within the
meaning of Section 15 of the Securities Act and Section 20 of the Exchange Act,
to the same extent as the foregoing indemnity from the Company to each
Underwriter, but only with reference to information relating to such
Underwriter furnished to the Company in writing by such Underwriter through the
Representatives expressly for use in the Registration Statement, the
Prospectus, any amendment or supple ment thereto, or any preliminary
prospectus.
If any suit, action, proceeding (including any governmental or
regulatory investigation), claim or demand shall be brought or asserted against
any person in respect of which indemnity may be sought pursuant to either of
the two preceding paragraphs, such person (the "INDEMNIFIED PERSON") shall
promptly notify the person against whom such indemnity may be sought (the
"INDEMNIFYING PERSON") in writing, and the Indemnifying Person, upon request of
the Indemnified Person, shall retain counsel reasonably satisfactory to the
Indemnified Person to represent the Indemnified Person and any others the
19
<PAGE> 20
Indemnifying Person may designate in such proceeding and shall pay the fees and
expenses of such counsel related to such proceeding. In any such proceeding,
any Indemnified Person shall have the right to retain its own counsel, but the
fees and expenses of such counsel shall be at the expense of such Indemnified
Person unless (i) the Indemnifying Person and the Indemnified Person shall have
mutually agreed to the contrary, (ii) the Indemnifying Person has failed within
a reasonable time to retain counsel reasonably satisfactory to the Indemnified
Person or (iii) the named parties in any such proceeding (including any
impleaded parties) include both the Indemnifying Person and the Indemnified
Person and representation of both parties by the same counsel would be
inappropriate due to actual or potential differing interests between them. It
is understood that the Indemnifying Person shall not, in connection with any
proceeding or related proceeding in the same jurisdiction, be liable for the
fees and expenses of more than one separate firm (in addition to any local
counsel) for all Indemnified Persons, and that all such fees and expenses shall
be reimbursed as they are incurred. Any such separate firm for the
Underwriters, each affiliate of any Underwriter which assists such Underwriter
in the distribution of the Securities and such control persons of Underwriters
shall be designated in writing by the first of the named Representatives on
Schedule I hereto and any such separate firm for the Company, its directors,
its officers who sign the Registration Statement and such control persons of
the Company or authorized representatives shall be designated in writing by the
Company. The Indemnifying Person shall not be liable for any settlement of any
proceeding effected without its written consent, but if settled with such
consent or if there be a final judgment for the plaintiff, the Indemnifying
Person agrees to indemnify any Indemnified Person from and against any loss or
liability by reason of such settlement or judgment. Notwithstanding the
foregoing sentence, if at any time an Indemnified Person shall have requested
an Indemnifying Person to reimburse the Indemnified Person for fees and
expenses of counsel as contemplated by the third sentence of this paragraph,
the Indemnifying Person agrees that it shall be liable for any settlement of
any proceeding effected without its written consent if (i) such settlement is
entered into more than 30 days after receipt by such Indemnifying Person of the
aforesaid request and (ii) such Indemnifying Person shall not have reimbursed
the Indemnified Person in accordance with such request prior to the date of
such settlement. No Indemnifying Person shall, without the prior written
consent of the Indemnified Person, effect any settlement of any pending or
threatened proceeding in respect of which any Indemnified Person is or could
have been a party and indemnity could have been sought hereunder by such
Indemnified Person, unless such settlement includes an unconditional release of
such Indemnified Person from all liability on claims that are the subject
matter of such proceeding.
If the indemnification provided for in the first and second paragraphs
of this Section 7 is unavailable to an Indemnified Person or insufficient in
respect of
20
<PAGE> 21
any losses, claims, damages or liabilities referred to therein, then each
Indemnifying Person under such paragraph, in lieu of indemnifying such
Indemnified Person thereunder, shall contribute to the amount paid or payable
by such Indemnified Person as a result of such losses, claims, damages or
liabilities (i) in such proportion as is appropriate to reflect the relative
benefits received by the Company on the one hand and the Underwriters on the
other hand from the offering of the Securities or (ii) if the allocation
provided by clause (i) above is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits referred
to in clause (i) above but also the relative fault of the Company on the one
hand and the Underwriters on the other in connection with the statements or
omissions that resulted in such losses, claims, damages or liabilities, as well
as any other relevant equitable considerations. The relative benefits received
by the Company on the one hand and the Underwriters on the other shall be
deemed to be in the same respective proportions as the net proceeds from the
offering of such Securities (before deducting expenses) received by the Company
and the total underwriting discounts and the commissions received by the
Underwriters bear to the aggregate public offering price of the Securities. The
relative fault of the Company on the one hand and the Underwriters on the other
shall be determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged omission
to state a material fact relates to information supplied by the Company or by
the Underwriters and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 7 were determined by pro
rata allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation that does not take account of the
equitable considerations referred to in the immediately preceding paragraph.
The amount paid or payable by an Indemnified Person as a result of the losses,
claims, damages and liabilities referred to in the immediately preceding
paragraph shall be deemed to include, subject to the limitations set forth
above, any legal or other expenses reasonably incurred by such Indemnified
Person in connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 7, in no event shall an
Underwriter be required to contribute any amount in excess of the amount by
which the total price at which the Securities underwritten by it and
distributed to the public were offered to the public exceeds the amount of any
damages that such Underwriter has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation. The Underwriters'
obligations to contribute pursuant to this
21
<PAGE> 22
Section 7 are several in proportion to the respective principal amount of the
Securities set forth opposite their names in Schedule I hereto, and not joint.
The remedies provided for in this Section 7 are not exclusive and
shall not limit any rights or remedies which may otherwise be available to any
indemnified party at law or in equity.
The indemnity and contribution agreements contained in this Section 7
and the representations and warranties of the Company set forth in this
Agreement shall remain operative and in full force and effect regardless of (i)
any termination of this Agreement, (ii) any investigation made by or on behalf
of any Underwriter or any person controlling any Underwriter or by or on behalf
of the Company, its officers or directors or any other person controlling the
Company and (iii) acceptance of and payment for any of the Securities.
For purposes of this Section 7 only, references to the Registration
Statement and Prospectus shall include the information included in the
Company's Form 8-K dated March 17, 2000, notwithstanding the fact that such
information was amended and superceded by the Company's Form 8-K/A dated May
15, 2000.
8. Notwithstanding anything herein contained, this Agreement may be
terminated in the absolute discretion of the Representatives, by notice given
to the Company, if after the execution and delivery of this Agreement and prior
to the Closing Date (i) trading generally shall have been suspended or
materially limited on or by, as the case may be, any of the New York Stock
Exchange, the American Stock Exchange or the National Association of Securities
Dealers, Inc., (ii) trading of any securities of or guaranteed by the Company
shall have been suspended on any exchange or in any over-the-counter market,
(iii) a general moratorium on commercial banking activities in New York shall
have been declared by either Federal or New York State authorities, or (iv)
there shall have occurred any outbreak or escalation of hostilities or any
change in financial markets or any calamity or crisis that, in the judgment of
the Representatives, is material and adverse and which, in the judgment of the
Representatives, makes it impracticable to market the Securities on the terms
and in the manner contemplated in the Prospectus.
9. If, on the Closing Date, any one or more of the Underwriters
shall fail or refuse to purchase Securities which it or they have agreed to
purchase under this Agreement, and the aggregate principal amount of Securities
which such defaulting Underwriter or Underwriters agreed but failed or refused
to purchase is not more than one-tenth of the aggregate principal amount of the
Securities, the other Underwriters shall be obligated severally in the
proportions that the
22
<PAGE> 23
principal amount of Securities set forth opposite their respective names in
Schedule II hereto bears to the aggregate principal amount of Securities set
forth opposite the names of all such non-defaulting Underwriters, or in such
other proportions as the Representatives may specify, to purchase the
Securities which such defaulting Underwriter or Underwriters agreed but failed
or refused to purchase on such date; provided that in no event shall the
principal amount of Securities that any Underwriter has agreed to purchase
pursuant to Section 1 be increased pursuant to this Section 9 by an amount in
excess of one-tenth of such principal amount of Securities without the written
consent of such Underwriter. If, on the Closing Date, any Underwriter or
Underwriters shall fail or refuse to purchase Securities and the aggregate
principal amount of Securities with respect to which such default occurs is
more than one-tenth of the aggregate principal amount of Securities to be
purchased, and arrangements satisfactory to you and the Company for the
purchase of such Securities are not made within 36 hours after such default,
this Agreement shall terminate without liability on the part of any
non-defaulting Underwriter or the Company. In any such case either you or the
Company shall have the right to postpone the Closing Date, but in no event for
longer than seven days, in order that the required changes, if any, in the
Registration Statement and in the Prospectus or in any other documents or
arrangements may be effected. Any action taken under this paragraph shall not
relieve any defaulting Underwriter from liability in respect of any default of
such Underwriter under this Agreement.
10. If this Agreement shall be terminated by the Underwriters, or any
of them, because of any failure or refusal on the part of the Company to comply
with the terms or to fulfill any of the conditions of this Agreement, or if for
any reason the Company shall be unable to perform its obligations under this
Agreement or any condition of the Underwriters' obligations cannot be
fulfilled, the Company agrees to reimburse the Underwriters or such
Underwriters as have so terminated this Agreement with respect to themselves,
severally, for all out-of-pocket expenses (including the fees and expenses of
their counsel) reasonably incurred by such Underwriters in connection with this
Agreement or the offering of Securities.
11. This Agreement shall inure to the benefit of and be binding upon
the Company, each affiliate of any Underwriter which assists such Underwriter
in the distribution of the Securities, the Underwriters, any controlling
persons referred to herein and their respective successors and assigns. Nothing
expressed or mentioned in this Agreement is intended or shall be construed to
give any other person, firm or corporation any legal or equitable right, remedy
or claim under or in respect of this Agreement or any provision herein
contained. No purchaser of Securities from any Underwriter shall be deemed to
be a successor by reason merely of such purchase.
23
<PAGE> 24
12. Any action by the Underwriters hereunder may be taken by you
jointly or by the first of the named Representatives set forth in Schedule I
hereto alone on behalf of the Underwriters, and any such action taken by you
jointly or by the first of the named Representatives set forth in Schedule I
hereto alone shall be binding upon the Underwriters. All notices and other
communications hereunder shall be in writing and shall be deemed to have been
duly given if mailed or transmitted by any standard form of telecommunication.
Notices to the Underwriters shall be given at the address set forth in Schedule
I hereto. Notices to the Company shall be given to it at Valero Energy
Corporation, One Valero Place, San Antonio, Texas 78212 (telex: (210)
370-2000); Attention: Corporate Secretary.
13. This Agreement may be signed in counterparts, each of which shall
be an original and all of which together shall constitute one and the same
instrument.
14. This Agreement shall be governed by and construed in accordance
with the laws of the State of New York, without giving effect to the conflicts
of laws provisions thereof.
Very truly yours,
VALERO ENERGY CORPORATION
By:
---------------------------------
Name:
Title:
24
<PAGE> 25
Accepted: __________, 2000
J.P. MORGAN SECURITIES INC.
MORGAN STANLEY & CO.
INCORPORATED
CREDIT SUISSE FIRST BOSTON
CORPORATION
Acting severally on behalf of themselves
and the several Underwriters listed
in Schedule II hereto.
By: J.P. MORGAN SECURITIES INC.
By:
-------------------------------
Name:
Title:
25
<PAGE> 26
SCHEDULE I
<TABLE>
<S> <C>
Representatives: J.P. Morgan Securities Inc.
Morgan Stanley & Co. Incorporated
Credit Suisse First Boston Corporation
--------------------------------------
Underwriting Agreement dated: _____________, 2000
--------------------------------------
Registration Statement No.: 333-33846-01
--------------------------------------
Title of Securities:
--------------------------------------
Aggregate principal amount: $
--------------------------------------
Price to Public: __% of the principal amount of the
Securities, plus accrued interest, if any,
from _____________, 2000 to the Closing
Date.
Indenture: Indenture dated as of December 12, 1997
between the Company and The Bank of
New York, as Trustee.
Maturity:
----------------------------------------
Interest Rate: __.__%
----------------------------------------
Interest Payment Dates:
----------------------------------------
Optional Redemption Provisions:
----------------------------------------
Sinking Fund Provisions: NONE
----------------------------------------
Other Provisions: NONE
----------------------------------------
Closing Date and Time of Delivery: ________, 2000
----------------------------------------
Address for Notices to Underwriters: J.P. Morgan Securities Inc.
60 Wall Street
New York, NY 10260-0060
---------------------------------------
</TABLE>
<PAGE> 27
SCHEDULE II
<TABLE>
<CAPTION>
PRINCIPAL AMOUNT
OF SECURITIES
UNDERWRITER PURCHASED
------------ ---------------
<S> <C>
J.P. Morgan Securities Inc. ...........................................
Morgan Stanley & Co. Incorporated......................................
Credit Suisse First Boston Corporation.................................
BMO Nesbitt Burns Corp. ...............................................
Banc One Capital Markets, Inc. ........................................
Barclays Capital Inc. .................................................
Paribas Corporation....................................................
CIBC World Markets Corp. ..............................................
Credit Lyonnais Securities (USA) Inc. .................................
Fleet Boston Robertson Stephens Inc. ..................................
RBC Dominion Securities Corporation....................................
Scotia Capital (USA) Inc. .............................................
SG Cowen Securities Corporation........................................
TD Securities (USA) Inc. ..............................................
Total.........................................................
</TABLE>
