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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Schedule 13D
Under the Securities Exchange Act of 1934
Amendment No. 13
SOUTHDOWN, INC.
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(Name of Issuer)
Common Stock
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(Title of Class of Securities)
84-129710
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(CUSIP Number)
N. Colin Lind
Richard C. Blum & Associates, Inc.
909 Montgomery St., Suite 400
San Francisco, CA 94133
(415) 434-1111
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(Name, Address and telephone Number of Persons
Authorized to Receive Notices and Communications)
January 20, 1994
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(Date of Event which Requires
Filing of this Statement)
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CUSIP No. 84-129710 13D
1. NAME OF REPORTING PERSON
RICHARD C. BLUM & ASSOCIATES, INC.
I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
IRS I.D. #94-2967812
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [ ]
3. SEC USE ONLY
4. SOURCE OF FUNDS N/A
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS
REQUIRED PURSUANT TO ITEMS 2(d) OR 2 (e) [ ]
6. CITIZENSHIP OR PLACE OF ORGANIZATION CALIFORNIA
7. SOLE VOTING POWER COMMON STOCK 2,521,600*
8. SHARED VOTING POWER
NUMBER OF SHARES
BENEFICIALLY OWNED BY
EACH REPORTING PERSON 9. SOLE DISPOSITIVE POWER COMMON STOCK 2,521,600*
WITH
10. SHARED DISPOSITIVE POWER
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH
REPORTING PERSON COMMON STOCK 2,521,600*
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES [ ]
13. PERCENT OF CLASS REPRESENTED BY AMOUNT
IN ROW (11) 14.7%
14. TYPE OF REPORTING PERSON IA
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* As investment adviser with discretion over the account of The
Carpenters Pension Trust for Southern California. The amount
reported includes 158,000 shares that could be acquired upon
conversion of 63,200 shares of Series B Convertible Exchangeable
Preferred Stock. The amount reported does not include options to
acquire up to 2,500 shares of Common Stock issued to Ronald N. Tutor,
a Co-Chairman of the Trust who has been a director of the Issuer
since July 1992, because it is not clear whether such options could
be issued or transferred to the Trust under the terms of the Issuer's
option plan. Mr. Tutor is holding such options for the benefit of
the Trust, which would ultimately be the beneficiary of any profits
earned on such options under ERISA.
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CUSIP No. 84-129710 13D
1. NAME OF REPORTING PERSON
CARPENTERS PENSION TRUST FOR SOUTHERN CALIFORNIA
I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
IRS I.D. #95-6042875
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [ ]
3. SEC USE ONLY
4. SOURCE OF FUNDS WC
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS
REQUIRED PURSUANT TO ITEMS 2(d) OR 2 (e) [ ]
6. CITIZENSHIP OR PLACE OF ORGANIZATION CALIFORNIA
7. SOLE VOTING POWER
8. SHARED VOTING POWER COMMON STOCK 2,521,600*
NUMBER OF SHARES
BENEFICIALLY OWNED BY
EACH REPORTING PERSON 9. SOLE DISPOSITIVE POWER
WITH
10. SHARED DISPOSITIVE POWER COMMON STOCK 2,521,600*
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH
REPORTING PERSON COMMON STOCK 2,521,600*
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES [ ]
13. PERCENT OF CLASS REPRESENTED BY AMOUNT
IN ROW (11) 14.7%
14. TYPE OF REPORTING PERSON EP
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* Carpenter's Pension Trust possesses economic beneficial ownership.
Full discretion, voting and acquisition and disposition
authority has been granted to its investment adviser, Richard C. Blum
& Associates, Inc. but the Trust has the power to terminate the
advisory agreement. Shares include 158,000 shares that could be
acquired upon conversion of its shares of Series B Convertible
Preferred Stock. The amount reported does not include options to
acquire up to 2,500 shares of Common Stock issued to Ronald N. Tutor,
a Co-Chairman of the Trust who has been a director of the Issuer since
July 1992, because it is not clear whether such options could be
issued or transferred to the Trust under the terms of the Issuer's
option plan. Mr. Tutor is holding such options for the benefit of the
Trust, which would ultimately be the beneficiary of any profits earned
on such options under ERISA.
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ITEM 1. SECURITY AND ISSUER
This Schedule 13D relates to shares of the common stock, $1.25 par value, ("the
Stock") of Southdown, Inc., a Louisiana Corporation, ("the issuer"). The
principal executive office and mailing address of the Issuer is 1200 Smith
Street, Suite 2400, Houston, TX 77002.
ITEM 2. IDENTITY AND BACKGROUND
This Amendment 13 to Schedule 13D is filed by The Carpenters Pension Trust of
Southern California (the "Trust"), a pension fund governed by the provisions of
ERISA, and Richard C. Blum & Associates, Inc. ("RCBA").
RCBA is a California corporation whose principal business is acting as general
partner for investment partnerships and providing investment advisory and
financial consulting services. RCBA is a registered investment adviser. Its
principal business office address is 909 Montgomery Street, Suite 400, San
Francisco, California 94133.
The names of the executive officers and directors of RCBA, their addresses,
citizenship, and principal occupations are as follows:
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NAME AND PRINCIPAL OCCUPATION
OFFICE HELD BUSINESS ADDRESS CITIZENSHIP OR EMPLOYMENT
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Richard C. Blum 909 Montgomery St. USA Chairman and Director,
Chairman and Suite 400 Richard C. Blum
Director San Francisco, CA & Associates, Inc.
94133
Thomas L. Kempner 40 Wall Street USA Chairman, Loeb Partners
Director New York, NY 10005 Corporation, Investment
Banking Business
N. Colin Lind 909 Montgomery St. NORWAY Managing Director,
Managing Director, Suite 400 and Director,
and Director San Francisco, CA Richard C. Blum &
94133 Associates, Inc.
Alexander L. Dean 909 Montgomery St. USA Managing Director,
Managing Director, Suite 400 Investments, and
Investments and San Francisco, CA Director, Richard C.
Director 94133 Blum & Associates, Inc.
George A. Pavlov 909 Montgomery St. USA Managing Director,
Managing Director, Suite 400 Chief Financial Officer,
Chief Financial San Francisco, CA Richard C. Blum
Officer 94133 & Associates, Inc.
Peter E. Rosenberg 909 Montgomery St. USA Managing Director,
Managing Director, Suite 400 Investments and
Investments and San Francisco, CA Director, Richard C.
Director 94133 Blum & Associates
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The information concerning The Carpenters Pension Trust of Southern California,
which is governed by a board of trustees is as follows:
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<CAPTION>
NAME AND PRINCIPAL OCCUPATION
OFFICE HELD BUSINESS ADDRESS CITIZENSHIP OR EMPLOYMENT
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Kim Fromer 22225 Acorn Street USA President, Fromer, Inc.
Trustee Chatsworth, CA 91311
Curtis Conyers, Jr. 4719 Exposition Blvd. USA President
Trustee Los Angeles, CA 90016 Richard Lane Company
Richard Harris 1717 W. Lincoln Ave. USA General Manager
Trustee Anaheim, CA 92801 Wesseln Construction
Co., Inc.
Ralph Larison 1925 Water Street USA President
Trustee Long Beach, CA 90802 Connolly-Pacific Co.
Bert Lewitt 2901 28th Street USA President
Trustee Santa Monica, CA 90405 Morley Construction Co.
Ronald N. Tutor 15901 Olden Street USA President, Tutor-
Co-Chairman Sylmar, CA 91342 Saliba Corporation
J.D. Butler 412 Dawson Drive USA Executive Secretary
Trustee Camarillo, CA 93010 Gold Coast District
Council of Carpenters
Steve Graves 520 So. Virgil Ave. USA Administrative
Trustee Los Angeles, CA 90020 Assistant, Southern
California District
Council of Carpenters
Douglas J. McCarron 520 So. Virgil Ave. USA Secretary-Treasurer
Chairman Los Angeles, CA 90020 Southern California
District Council
of Carpenters
Bill Perry 520 So. Virgil Ave. USA Administrative
Trustee Los Angeles, CA 90020 Assistant, Southern
California District
Council of Carpenters
Buddy Self 911 20th Street USA Financial Secretary
Trustee Bakersfield, CA 93301 Carpenters Local
Union 743
Fred Taylor 341 E. Wardlow Rd. USA Financial Secretary
Trustee Long Beach, CA 90807 Carpenters Local
Union 680
</TABLE>
To the best knowledge of the Reporting Persons, none of the entities or persons
identified in this Item 2 has, during the past five years, been convicted of
any criminal proceeding (excluding traffic violations or similar misdemeanors),
nor been a party to a civil proceeding of a judicial or administrative body of
competent jurisdiction and as a result of such proceeding was or is subject to
a judgment, decree or final order enjoining future violations of, or
prohibiting or mandating activities subject to, federal or state securities
laws or finding any violation with respect to such laws.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION
The funds to purchase shares of common stock of the Issuer were from the assets
held by the Trust.
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ITEM 4. PURPOSE OF TRANSACTION
The Carpenters Pension Trust acquired the stock for investment purposes. The
Reporting Persons have agreed to sell some of the shares of the stock pursuant
to the Purchase Agreement described below. The Reporting Persons may sell some
or all of the remaining shares of stock, depending on market conditions and
other factors.
Southdown filed on November 22, 1993, a registration statement with respect to
a proposed underwritten offering by Southdown of $75 million of cumulative
convertible preferred stock, and pursuant to a Registration Rights and Lock Up
Agreement ("Rights Agreement") executed on November 22, 1993, Southdown filed
on November 22, 1993 a registration statement with respect to a proposed
underwritten offering by the Reporting Persons of 1,250,000 shares of Southdown
Common Stock (excluding 187,500 shares solely to cover over-allotments). On
January 20, 1994, Southdown filed an amended registration statement reflecting
an increase in the underwritten offering by the Reporting Persons to 1,550,000
shares of Southdown Common Stock (excluding 232,500 shares solely to cover
over-allotments).
On January 20, 1994, the Reporting Persons entered into a underwriting
agreement ("Purchase Agreement") with Southdown, Inc. and Merrill Lynch & Co.,
Merrill Lynch, Pierce, Fenner & Smith Incorporated, Kidder Peabody & Co.
Incorporated, and Lehman Brothers Inc. as representatives of the Underwriters
listed in Schedule A thereto, pursuant to which the Reporting Persons agreed to
sell 1,550,000 shares of Southdown common stock to the Underwriters (excluding
232,500 shares solely to cover over- allotments) for $ 25.635 per share. The
complete terms of the Purchase Agreement are set forth in Exhibit 4.5 to this
Schedule 13D Amendment.
Pursuant to the Rights Agreement, Southdown has agreed that, if RCBA so
requests, it will file a subsequent registration statement to allow RCBA and
the Trust to sell any of the shares they now own beneficially that are not sold
in their underwritten offering. In consideration for these registration
rights, RCBA and the Trust have agreed not to directly or indirectly sell or
otherwise dispose of any of their shares until 90 days after the effective date
of the registration statement for Southdown's proposed preferred stock offering
(except in a contemporaneous sale in the underwritten offering of their shares
noted above). The complete terms of the Rights Agreement are set forth in
Exhibit 4.4 to this Schedule 13D Amendment.
RCBA, the Trust, and Southdown, Inc. are parties to a Settlement Agreement
dated April 16, 1993, pursuant to which a proxy contest was settled and three
additional non-management directors were nominated for election to Southdown's
Board of Directors. The complete terms of the Settlement Agreement were set
forth in Exhibit 4.3 to the Reporting Persons' Amendment No. 10 to Schedule
13D.
Other than such influence on management of the Issuer that would be made by the
addition of new independent directors, the Reporting Persons have no other
present plans or proposals that relate to or would result in any of the actions
set forth in clauses (a) through (j) of Item 4.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER
(a) & (b) Based on the 17,045,809 shares of Common Stock reported by the
Issuer as being issued and outstanding (plus the common shares into which the
Trust's Series B Shares are convertible), the foregoing holdings represent
14.7% of the total.
(c) During the last sixty days, the Reporting Persons have not effected any
transactions in the Issuer's securities.
(d) and (e) not applicable.
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ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT
TO SECURITIES OF THE ISSUER
Southdown filed on November 22, 1993, a registration statement with respect to
a proposed underwritten offering by Southdown of $75 million of cumulative
convertible preferred stock, and pursuant to a Registration Rights and Lock Up
Agreement ("Rights Agreement") executed on November 22, 1993, Southdown filed
on November 22, 1993 a registration statement with respect to a proposed
underwritten offering by the Reporting Persons of 1,250,000 shares of Southdown
Common Stock (excluding 187,500 shares solely to cover over-allotments). On
January 20, 1994, Southdown filed an amended registration statement reflecting
an increase in the underwritten offering by the Reporting Persons to 1,550,000
shares of Southdown Common Stock (excluding 232,500 shares solely to cover
over-allotments).
On January 20, 1994, the Reporting Persons entered into a underwriting
agreement ("Purchase Agreement") with Southdown, Inc. and Merrill Lynch & Co.,
Merrill Lynch, Pierce, Fenner & Smith Incorporated, Kidder Peabody & Co.
Incorporated, and Lehman Brothers Inc. as representatives of the Underwriters
listed in Schedule A thereto, and entered into a pricing agreement ("Pricing
Agreement") with Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith
Incorporated, Kidder Peabody & Co. Incorporated, and Lehman Brothers Inc. as
representatives of the Underwriters listed in Schedule A to the Purchase
Agreement, pursuant to which the Reporting Persons agreed to sell 1,550,000
shares of Southdown common stock (excluding 232,500 shares solely to cover
over-allotments) to the Underwriters for $ 25.635 per share. The complete
terms of the Purchase Agreement and Pricing Agreement are set forth in Exhibit
4.5 to this Schedule 13D Amendment.
Pursuant to the Rights Agreement, Southdown has agreed that, if RCBA so
requests, it will file a subsequent registration statement to allow RCBA and
the Trust to sell any of the shares they now own beneficially that are not sold
in their underwritten offering. In consideration for these registration
rights, RCBA and the Trust have agreed not to directly or indirectly sell or
otherwise dispose of any of their shares until 90 days after the effective date
of the registration statement for Southdown's proposed preferred stock offering
(except in a contemporaneous sale in the underwritten offering of their shares
noted above). The complete terms of the Rights Agreement are set forth in
Exhibit 4.4 to this Schedule 13D Amendment.
RCBA, the Trust, and Southdown, Inc. are parties to a Settlement Agreement
dated April 16, 1993, pursuant to which a proxy contest was settled and three
additional non-management directors were nominated for election to Southdown's
Board of Directors. The complete terms of the Settlement Agreement were set
forth in Exhibit 4.3 to the Reporting Persons' Amendment No. 10 to Schedule
13D.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS
Exhibit 4.4 Registration Rights and Lock Up Agreement, dated November 22,
1993, by and among Southdown, RCBA, and the Trust.
Exhibit 4.5 Purchase Agreement and Pricing Agreement, dated January 20, 1994,
by and among Southdown, the Reporting Persons, and several underwriters named
in Schedule A thereto.
No additional exhibits.
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SIGNATURE
After reasonable inquiry and to the best of the knowledge and belief of the
undersigned, the undersigned certifies that the information set forth in this
statement is true, complete and correct.
DATED: January 21, 1994
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CARPENTERS PENSION TRUST OF
RICHARD C. BLUM & ASSOCIATES, INC. SOUTHERN CALIFORNIA
By: N. Colin Lind By: Richard C. Blum & Associates, Inc.,
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N. Colin Lind
Managing Director
By: N. Colin Lind
------------------------
N. Colin Lind
Managing Director
</TABLE>
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REGISTRATION RIGHTS AND LOCK UP AGREEMENT
REGISTRATION RIGHTS AND LOCK UP AGREEMENT, dated November 22, 1993
(the "Agreement"), by and among Southdown, Inc. (the "Company"), Richard C.
Blum & Associates, Inc. ("RCBA") and The Carpenters Pension Trust for Southern
California (the "Trust") (collectively, the "Parties").
WHEREAS, RCBA is the beneficial owner, on behalf of the Trust, of
2,521,600 shares of common stock, par value $1.25 of the Company ("Common
Stock"), including 2,363,600 shares of Common Stock (the "Common Shares") and
63,200 shares of the Company's Preferred Stock, $3.75 Convertible Exchangeable
Series B (the "Series B Shares") which are convertible into 158,000 shares of
Common Stock; and
WHEREAS, RCBA and the Trust have expressed their desire to sell the
Common Shares and the Series B Shares; and
WHEREAS, the Company is considering the public offering of a newly
created series of convertible preferred stock (the "Preferred Stock Offering");
and
WHEREAS, the Company is willing to prepare and file a registration
statement with respect to a firm commitment public offering of the Common
Shares and the shares of Common Stock into which the Series B Shares are
convertible (collectively, the "Shares"); and
WHEREAS, in connection with such registration statement and to
facilitate the Preferred Stock Offering, RCBA and the Trust are willing to
"lock up" the Shares and the Series B Shares for a period of time set forth
herein, in partial consideration for which the Company will grant them the
certain registration rights set forth herein.
NOW, THEREFORE, for and in consideration of the recitals set forth
above and the mutual agreements and transactions contemplated by this
Agreement, the Parties hereby agree as follows:
1. Registration Rights.
a. As promptly as practicable after the date of this
Agreement, the Company will prepare and file with the Securities and Exchange
Commission (the "Commission") a registration statement on Form S-3 (or such
other form as shall then be in use and which the Company is eligible to file)
covering a firm
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commitment underwritten public offering (the "Offering") of such number of the
Shares as shall be specified in writing by RCBA, and, subject to the other
provisions of this Agreement, will use its best efforts to cause the
registration statement to become effective under the Securities Act of 1933, as
amended (the "Act") . The representatives of the underwriters of the Offering
shall be Merrill Lynch & Co., Kidder, Peabody & Co. Incorporated, Lehman
Brothers, or such additional or different underwriters of national stature as
shall be determined by the Company. If RCBA and the Trust include all of their
Shares in the Offering, the Company will include in the registration statement
relating to the Offering 378,240 shares of Common Stock to be sold by the
Company, solely to cover over-allotments, if any. The Company shall have no
obligation to request that the registration statement relating to the Offering
be declared effective until such time as either (i) the Company and any
underwriters of the Preferred Stock Offering are prepared to have any
registration statement with respect to the Preferred Stock Offering declared
effective, to price the Preferred Stock Offering and to sign an underwriting
agreement with respect thereto or (ii) the Company determines to abandon the
Preferred Stock Offering, in which event it will promptly give written notice
to RCBA.
b. If less than all of the Shares have been sold in the
Offering prior to the expiration of the period set forth in Section 3, then
after that date and prior to March 1, 1995, RCBA and the Trust may give written
notice to the Company of the exercise of their one demand registration right
under this Agreement. Upon receipt of such notice, the Company will, as
promptly as practicable, prepare and file with the Commission a registration
statement with respect to the public offering of the remaining Shares (the
"Demand Offering"); provided that after March 1, 1995, the Company shall have
no obligation to file such a registration statement, shall not be obligated to
use its efforts to cause any such registration statement to become effective,
may deregister any securities covered by any such registration statement
previously declared effective and terminate the related registration statement,
and may withdraw any such registration statement previously filed which has not
become effective.
2. General Registration Procedures.
a. When the Company is required to file a registration
statement under this Agreement with respect to the Offering or the Demand
Offering, the Company, subject to Section 1.a and the last provision of Section
1.b, will:
(i) as promptly as practicable, prepare and file
with the Commission a registration statement (which shall be on Form S-3 to the
extent the Company is entitled to use such form) with respect to such offering,
and use its best efforts to cause
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such registration statement to become effective as promptly as practicable
thereafter and remain effective for such period ending on or prior to March 1,
1995 (A) as may be required by the Underwriting Agreement or (B) if the Demand
Offering is not underwritten, as may be required for the period of the
distribution contemplated thereby;
(ii) prepare and file with the Commission such
amendments and supplements to such registration statement and the prospectus
used in connection therewith as may be necessary to keep such registration
statement effective for such period ending on or prior to March 1, 1995 (A) as
may be required by the Underwriting Agreement or (B) if the Demand Offering is
not underwritten, as may be required for the period of the distribution
contemplated thereby;
(iii) furnish to RCBA and the Trust and to each
underwriter such number of copies of such registration statement and the
prospectus included therein (including each preliminary prospectus and each
document incorporated by reference therein to the extent then required by the
rules and regulations of the Commission) as such persons may reasonably request
in order to facilitate the Offering or the Demand Offering, as the case may be;
(iv) use its best efforts to register or qualify
the shares covered by such registration statement under the securities or blue
sky laws of such jurisdictions as may be required by the Underwriting Agreement
or, if the Demand Offering is not underwritten, as may be reasonably requested
by RCBA and the Trust;
(v) immediately notify RCBA and the Trust and
such underwriters as may be required under the Underwriting Agreement, at any
time when a prospectus relating to the Shares is required to be delivered under
the Act, of the happening of any event as a result of which the prospectus
contained in such registration statement, as then in effect, includes an untrue
statement of a material fact or omits to state any material fact required to be
stated therein or necessary to make the statements therein not misleading in
the light of the circumstances then existing;
(vi) cause to be delivered to the underwriters
under the Underwriting Agreement such opinions of counsel and letters of
independent public accountants as are reasonably required by the Underwriting
Agreement;
(vii) make available for inspection by
representatives of RCBA and the Trust, any underwriter participating in the
Offering or the Demand Offering and any attorney, accountant or other agent
retained by such
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representative of RCBA and the Trust or underwriter, all reasonably requested
financial and other records, pertinent corporate documents and properties of
the Company, and cause the Company's officers, directors and employees to
supply all information reasonably requested by any such representative of RCBA
and the Trust, underwriter, attorney, accountant or agent in connection with
such registration statement; and
(viii) make every reasonable effort to obtain the
withdrawal of any order suspending the effectiveness of such registration
statement at the earliest possible time.
b. In connection with any such registration statement,
RCBA and the Trust will furnish promptly to the Company in writing such
information with respect to themselves and the related offering as shall be
necessary in order to ensure compliance with federal and applicable state
securities laws.
c. Subject to the other provisions of this Agreement, in
connection with the Offering or an underwritten Demand Offering, RCBA, the
Trust and the Company agree to enter into a written underwriting agreement with
the managing underwriter or underwriters in such form and containing such
provisions as are customary in the securities business for such an arrangement
between major underwriters, selling shareholders and companies of the Company's
size and investment stature (the "Underwriting Agreement"); provided that (i)
such agreement shall not contain any such provision applicable to the Company
that is inconsistent with the provisions hereof; (ii) the time and place of the
closing under such agreement shall be as mutually agreed upon among the
Company, RCBA and the Trust and such managing underwriter; and (iii) if the
Company elects to sell no shares of Common Stock in the Offering, such
agreement shall not call for the sale of any such shares by the Company. The
Underwriting Agreement shall contain customary provisions pursuant to which the
Company, RCBA and the Trust, and the underwriters each indemnify the others for
customary matters, as well as related contribution provisions.
d. In connection with the Offerings, any Demand Offering
and the related registration statements, the Company shall pay all fees and
disbursements of its counsel and independent public accountants. The Company
and RCBA and the Trust shall each bear the federal and state registration and
filing fees and the underwriting discounts and selling commissions with respect
to the shares to be sold by them. RCBA and the Trust shall promptly pay (or,
if the Company has paid, reimburse the Company for), upon request, all other
third party expenses incurred by the Company in connection with the Offering,
any Demand Offering, and the related registration statements, including,
without limitation, blue sky fees and expenses, printing expenses, listing
fees, fees of the National Association
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of Securities Dealers, Inc. and fees of transfer agents and registrars. RCBA
and the Trust shall pay for the fees and disbursements of their counsel and any
transfer taxes on the Shares.
e. (i) In the event of a registration of any Shares
under the Act pursuant to this Agreement, the Company will indemnify and hold
harmless RCBA and the Trust and each underwriter of Shares thereunder and each
person who controls RCBA and the Trust or such underwriter within the meaning
of the Act and the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), against any losses, claims, damages or liabilities (including reasonable
attorneys' fees), joint or several, to which RCBA and the Trust or such
underwriter or controlling person may become subject under the Act, the
Exchange Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon any
untrue statement or alleged untrue statement of any material fact contained in
a registration statement under which such Shares were registered under the Act
pursuant to this Agreement, any preliminary or final prospectus contained
therein, or any amendment or supplement thereof, or arise out of or are based
upon the omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not
misleading, and will reimburse RCBA or the Trust, each such underwriter and
each such controlling person for any legal or other expenses reasonably
incurred by them in connection with investigating or defending any such loss,
claim, damage, liability or action; provided, however, that the Company will
not be liable in any such case if and to the extent that any such loss, claim,
damage or liability arises out of or is based upon an untrue statement or
alleged untrue statement or omission or alleged omission so made in conformity
with information furnished by RCBA or the Trust, such underwriter or such
controlling person in writing specifically for use in such registration
statement or prospectus.
(ii) RCBA and the Trust will indemnify and hold
harmless the Company and each person who controls the Company within the
meaning of the Act and the Exchange Act, each officer of the Company who signs
a registration statement under which Shares were registered under the Act
pursuant to this Agreement, each director of the Company, each underwriter and
each person who controls any underwriter within the meaning of the Act and the
Exchange Act, against any losses, claims, damages or liabilities (including
reasonable attorney's fees), joint or several, to which the Company or such
officer or director or underwriter or controlling person may become subject
under the Act, the Exchange Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are
based upon any untrue statement or alleged untrue statement of any material
fact contained in a registration
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statement under which Shares were registered under the Act pursuant to this
Agreement, any preliminary or final prospectus contained therein, or any
amendment or supplement thereof, or arise out of or are based upon the omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, and will
reimburse the Company and each such officer, director, underwriter and
controlling person for any legal or other expenses reasonably incurred by them
in connection with investigating or defending any such loss, claim, damage,
liability or action; provided, however, that RCBA and the Trust will be liable
hereunder in any such case if and only to the extent that any such loss, claim,
damage or liability arises out of or is based upon an untrue statement or
alleged untrue statement or omission or alleged omission made in reliance upon
and in conformity with information pertaining to RCBA or the Trust, furnished
in writing to the Company by RCBA or the Trust specifically for use in such
registration statement or prospectus; and provided further that the liability
of RCBA and the Trust hereunder shall be limited to the proportion of any such
loss, claim, damage, liability or expense which is equal to the proportion that
the public offering price of Shares sold by RCBA and the Trust under such
registration statement bears to the total public offering price of all
securities sold thereunder, but not to exceed the amount of the proceeds
received by RCBA and the Trust from the sale of the Shares covered by such
registration statement.
(iii) Promptly after receipt by an indemnified party
hereunder of notice of the commencement of any action, such indemnified party
shall, if a claim in respect thereof is to be made against the indemnifying
party hereunder, notify the indemnifying party in writing thereof, but the
omission so to notify the indemnifying party shall not relieve it from any
liability which it may have to any indemnified party other than under this
Section 2.e. In case any such action shall be brought against any indemnified
party and it shall notify the indemnifying party of the commencement thereof,
the indemnifying party shall be entitled to participate in and, to the extent
it shall wish, to assume and undertake the defense thereof with counsel
reasonably satisfactory to such indemnified party (who shall not, except with
the consent of the indemnified party, be counsel to the indemnifying party)
and, after notice from the indemnifying party to such indemnified party of its
election so to assume and undertake the defense thereof, the indemnifying party
shall not be liable to such indemnified party under this Section 2.e for any
legal expenses subsequently incurred by such indemnified party in connection
with the defense thereof other than reasonable costs of investigation.
- 6 -
<PAGE> 7
(iv) If the indemnification provided for in this
Section 2.e is unavailable or insufficient to hold harmless an indemnified
party under subparagraph (i) or (ii) thereof in respect of any losses, claims,
damages or liabilities or actions in respect thereof, referred to therein, then
each indemnifying party shall in lieu of indemnifying such indemnified party
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages, liabilities or actions in such proportion as
is appropriate to reflect the relative fault of the Company, on the one hand,
and RCBA and the Trust, on the other, in connection with the statements or
omission which resulted in such losses, claims, damages, liabilities or actions
as well as any other relevant equitable considerations, including the failure
to give any required notice. The relative fault 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, on the one hand,
or RCBA or the Trust on the other, and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission. The Company and RCBA and the Trust agree that it would not be just
and equitable if contribution pursuant to this subparagraph 2.e(iv) were
determined by pro rata allocation or by any other method of allocation which
does not take account of the equitable considerations referred to above in this
subparagraph 2.e(iv). The amount paid or payable by an indemnified party as a
result of the losses, claims, damages, liabilities or actions in respect
thereof referred to above in this subparagraph 2.e(iv) shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified
party in connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this subparagraph 2.e(iv), the amount that
RCBA and the Trust shall be required to contribute shall not exceed the total
price at which the securities sold by them were offered to the public. No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation.
3. No Other Offers or Sales. RCBA and the Trust agree that until
(A) the earlier of (i) 90 days after the effective date of the registration
statement with respect to the Preferred Stock Offering or (ii) the date on
which the Company gives written notice to RCBA that it has abandoned the
Preferred Stock Offering or (B) March 1, 1994 (but only if neither the
registration statement relating to the Preferred Stock Offering has become
effective nor has the Company given to RCBA written notice that it has
abandoned the Preferred Stock Offering prior to March 1, 1994), neither RCBA
nor the Trust nor any of their "affiliates" or "associates" (as such terms are
defined in Rule 12b-2 of the Exchange Act) will, directly or indirectly, sell,
- 7 -
<PAGE> 8
contract or agree to sell, offer to sell or solicit any offer to purchase or
otherwise dispose of any of the Shares or the Series B Shares or any right or
option to purchase or acquire the same (except a sale of Shares by RCBA and the
Trust to the underwriters of the Offering pursuant to the Underwriting
Agreement contemporaneously with the sale of shares of a newly created series
of preferred stock by the Company to the underwriters of the Preferred Stock
Offering).
4. Expenses. Each of the Parties shall bear its own expenses in
connection with the negotiation, execution and delivery of this Agreement. The
fees and expenses in connection with the Offering, the Demand Offering and the
related registration statements shall be borne by the Parties as set forth in
Section 2.d.
5. Representations and Warranties.
a. RCBA and the Trust. RCBA and the Trust represent and
warrant to, and covenant and agree with, the Company that:
(i) They have full corporate and trust power and
authority to enter into this Agreement and to consummate the transactions
contemplated hereby, and RCBA has full power and authority to bind the Trust
and the Shares hereto by RCBA's execution of this Agreement for and on behalf
of the Trust;
(ii) The execution, delivery and performance of
this Agreement by them (A) has been duly authorized by all necessary corporate
or trust action, as the case may be, (B) will not conflict with or result in a
breach, default or violation of (1) any of the terms or provisions of the
charter or bylaws or other organizational documents of RCBA or the Trust or (2)
any judgment, decree, order, permit, certificate, applicable law or regulation
or material agreement, instrument or license, to which either of them is a
party or by which either of them or their property is bound, and (C) will not
require any consent or approval of any third party which has not been obtained;
and
(iii) Neither RCBA nor the Trust owns of record or
beneficially, directly or indirectly, any shares of Common Stock or any other
equity security of the Company or any option or warrant or other right to
acquire any such equity security, or any security convertible into or
exchangeable for any such equity security, except for the Common Shares and the
Series B Shares and except for options to purchase 15,000 shares of Common
Stock granted to Ronald N. Tutor, a director of the Company and Co-Chairman of
the Trust, pursuant to the Company's 1991 Non-Qualified Stock Option Plan for
NonEmployee Directors.
- 8 -
<PAGE> 9
b. The Company. The Company represents and warrants to,
and covenants and agrees with, RCBA and the Trust that:
(i) It has full corporate power and authority to
enter in to this Agreement and to consummate the transactions contemplated
hereby; and
(ii) The execution, delivery and performance of
this Agreement by it (A) has been duly authorized by all necessary corporate
action, (B) will not conflict with or result in a breach, default or violation
of (1) any of the terms or provisions of its charter or bylaws or (2) any
judgment, decree, order, permit, certificate, applicable law or regulation or
material agreement, instrument or license, to which it is a party or by which
it or its property is bound, and (C) will not require any consent or approval
of any third party which has not been obtained, other than the Securities and
Exchange Commission and applicable state securities commissions.
6. Miscellaneous Provisions
a. Notices. Any notice, consent or other communication
required or permitted hereunder must be in writing to be effective and shall be
deemed delivered and received (i) if personally delivered, delivered by
overnight courier, or delivered by telex or telecopy with electronic
confirmation, when actually received by the Party to whom sent, or (ii) if
delivered by mail (whether actually received or not) , at the close of business
on the third business day next following the day when placed in the federal
mail, postage prepaid, certified or registered mail, return receipt requested,
addressed as follows:
If to the Company:
Southdown, Inc.
Attn: Edgar J. Marston III
1200 Smith Street
Suite 2400
Houston, Texas 77002
Facsimile: 713-653-8010
with a copy to:
Bracewell & Patterson, L.L.P.
Attn: R. Daniel Witschey, Jr.
711 Louisiana Street, Suite 2900
Houston, Texas 77002-2781
Facsimile: 713-221-1212
- 9 -
<PAGE> 10
If to RCBA:
Richard C. Blum & Associates, Inc.
Attn: Susan Barnes
909 Montgomery Street
Suite 400
San Francisco, California 94132
Facsimile: 415-434-3130
with a copy to:
Wilmer, Cutler & Pickering
Attn: Michael R. Klein
2445 M Street, N.W.
Washington, D.C. 20037-1420
Facsimile: 202-663-6454
If to the Trust:
Carpenters Pension Trust
for Southern California
Attn: Ron Schoen
520 South Virgil Avenue
Los Angeles, California 90020
Facsimile: 213-739-9318
with a copy to:
DeCarlo, Connor & Selvo
Attn: Mr. John DeCarlo
500 South Virgil Avenue
Suite 320
Los Angeles, California 90020
Facsimile: 213-738-1813
(or to such other address as either Party shall specify by written notice so
given)
b. Binding Effect; Benefits. This Agreement shall be
binding upon and shall inure to the benefit of the Parties hereto, and may not
be assigned. Section 3 of this Agreement shall also inure to the benefit of
and be enforceable by any underwriters of the Preferred Stock Offering.
c. Entire Agreement. This Agreement constitutes the
final written expression of all of the agreements between the Parties with
respect to the subject matter hereof, and is a complete and exclusive statement
of those terms. Except as specifically included or referred to herein, this
Agreement supersedes all understandings and negotiations concerning the matters
specified herein. Any promises or statements made by any Party that differ in
any way from the terms of this written
- 10 -
<PAGE> 11
agreement shall be given no force or effect (except as specifically included or
referred to herein). The Parties specifically represent, each to the other,
that there are no additional or supplemental agreements between them related in
any way to the matters herein contained unless specifically included or
referred to herein. No addition to or modification of any provision hereof
shall be binding upon any Party unless made in writing and signed by all
Parties.
d. Governing Law. This Agreement shall be governed by
and construed in accordance with the laws of the State of Texas (exclusive of
the conflict of law provisions thereof).
e. Counterparts. This Agreement may be executed in any
number of counterparts, each of which shall be deemed an original but all of
which shall constitute one and the same instrument.
f. Headings. The headings of the Sections of this
Agreement are for the convenience of the Parties only, and shall be given no
substantive or interpretive effect whatsoever.
g. Waivers. The Company, on the one hand, and RCBA and
the Trust, on the other, may, by written notice to the other: (1) waive any
inaccuracies in the representations or warranties of the other contained herein
or in any document delivered pursuant hereto; (2) waive compliance with any of
the conditions or covenants of the other contained herein; or (3) waive
performance of any of the obligations of the other hereunder. Except as
provided in the preceding sentence, no action taken pursuant hereto, including
without limitation any investigation by or on behalf of any Party, shall be
deemed to constitute a waiver by the Party taking such action of compliance
with any representations, warranties, covenants or agreements contained herein.
No failure or delay on the part of any Party in exercising any right,
privilege, power, or remedy under this Agreement, and no course of dealing
among the Parties, shall operate as a waiver of such right, privilege, power,
or remedy; nor shall any single or partial exercise of any right, privilege,
power or remedy under this Agreement preclude any other or further exercise of
such right, privilege, power, or remedy, or the exercise of any other right,
privilege, power or remedy. No notice to or demand on any Party in any case
shall entitle such party to any other or further notice or demand in any
similar or other circumstances or constitute a waiver of the right of the Party
giving such notice or making such demand to take any other or further action in
any circumstances without notice or demand.
h. Severability. If any provision of this Agreement
or the application thereof to any person or circumstance shall be invalid or
unenforceable to any extent, the remainder of this Agreement and the
application of such provisions to other persons
- 11 -
<PAGE> 12
or circumstances shall not be affected thereby, and the intent of this
Agreement shall be enforced to the greatest extent permitted by law.
i. Drafting. Each Party acknowledges that its legal
counsel participated in the preparation of this Agreement. The Parties
therefore stipulate and agree that the rule of construction that ambiguities
are to be resolved against the drafting party shall not be employed in the
interpretation of this Agreement to favor either Party against the other.
j. References. The use of the words "hereof," "herein,"
"hereunder, " "herewith," "hereto," "hereby," and words of similar import shall
refer to this entire Agreement, and not to any particular article, section,
subsection, clause, or paragraph of this Agreement, unless the context clearly
indicates otherwise.
k. Cumulative Rights. All rights and remedies specified
herein are cumulative and are in addition to, not in limitation of, any rights
or remedies the Parties may have by statute, at law, in equity, or otherwise,
and all such rights and remedies may be exercised singularly or concurrently.
l. Enforcement; Proper Court. Each of the Parties
acknowledges and agrees that irreparable harm would occur if any provision of
this Agreement were not performed in accordance with the terms thereof, or were
otherwise breached, and that such harm could not be remedied by an award of
money damages. Accordingly, the Parties hereto agree that any non-breaching
Party shall be entitled to an injunction to prevent breaches of this Agreement
and to enforce specifically the terms and provisions hereof in any court of
competent jurisdiction, within the State of Texas. More specifically, each of
the Parties hereto hereby consents to the personal jurisdiction and venue of
the United States District Court for the Southern District of Texas, Houston
Division or any other court of competent jurisdiction in the State of Texas,
for and in respect of any action, suit or proceeding arising under this
Agreement, and each Party hereto agrees further that service of process or
notice in any action, suit or proceeding shall be effective if given in the
manner set forth in Section 6.a hereof.
- 12 -
<PAGE> 13
IN WITNESS WHEREOF, the Parties have caused this Agreement to be duly
executed by their respective duly authorized officers or signatories, to be
effective as of the date first above written.
<TABLE>
<S> <C>
SOUTHDOWN, INC. RICHARD C. BLUM & ASSOCIATES, INC.
By: /s/ Edgar J. Marston By: /s/ N. Colin Lind
---------------------- ---------------------
Authorized Officer Authorized Officer
THE CARPENTERS PENSION TRUST
FOR SOUTHERN CALIFORNIA
By: /s/ N. Colin Lind
---------------------
Authorized Signatory
</TABLE>
- 13 -
<PAGE> 1
- --------------------------------------------------------------------------------
SOUTHDOWN, INC.
1,550,000 SHARES
COMMON STOCK
PURCHASE AGREEMENT
MERRILL LYNCH & CO.
KIDDER, PEABODY & CO. INCORPORATED
LEHMAN BROTHERS INC.
- --------------------------------------------------------------------------------
<PAGE> 2
1,550,000 SHARES
SOUTHDOWN, INC.
(A LOUISIANA CORPORATION)
COMMON STOCK
(PAR VALUE $1.25 PER SHARE)
PURCHASE AGREEMENT
January 20, 1994
MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
KIDDER, PEABODY & CO. INCORPORATED
LEHMAN BROTHERS INC.
as Representatives of the
several Underwriters
c/o MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith Incorporated
Merrill Lynch World Headquarters
World Financial Center
North Tower
250 Vesey Street
New York, New York 10281
Dear Sirs:
Southdown, Inc., a Louisiana corporation (the "Company"), and
Carpenters Pension Trust for Southern California, a California pension fund,
and Richard C. Blum and Associates, Inc., a California corporation
(collectively, the "Selling Shareholder"), confirm their respective agreements
with you and each of the other underwriters named in Schedule A hereto
(collectively, the "Underwriters," which term shall also include any
underwriters substituted as hereinafter provided in Section 10 hereof), for
whom Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated
("Merrill Lynch"), Lehman Brothers Inc. ("Lehman Brothers") and Kidder, Peabody
& Co. Incorporated ("Kidder, Peabody") are acting as representatives (in such
capacity, Merrill Lynch, Lehman Brothers and Kidder, Peabody shall hereinafter
be collectively referred to as the "Representatives") with respect to the sale
by the Selling Shareholder of 1,550,000 shares of Common Stock, par value $1.25
per share, of the Company ("Common Stock") and the purchase by the
Underwriters, acting severally and not jointly, of the respective number of
shares of Common Stock set forth in Schedule A hereto and with respect to the
grant by the Selling Shareholder to the Underwriters of the option described in
Section 2 hereof to purchase all or any part of up
<PAGE> 3
to an additional 232,500 shares of Common Stock to cover over-allotments, in
each case except as may otherwise be provided in the Pricing Agreement, as
hereinafter defined. The 1,550,000 shares of Common Stock to be sold by the
Selling Shareholder ("Initial Securities"), together with all or any part of
the 232,500 shares of Common Stock subject to the option described in Section 2
hereof (the "Option Securities"), are collectively hereinafter called the
"Securities."
Prior to the purchase and public offering of the Securities by
the several Underwriters, the Selling Shareholder and the Representatives,
acting on behalf of the several Underwriters, shall enter into an agreement
substantially in the form of Exhibit A hereto (the "Pricing Agreement"). The
Pricing Agreement may take the form of an exchange of any standard form of
written telecommunication between the Selling Shareholder and the
Representatives and shall specify such applicable information as is indicated
in Exhibit A hereto. The offering of the Securities will be governed by this
Agreement, as supplemented by the Pricing Agreement. From and after the date
of the execution and delivery of the Pricing Agreement, this Agreement shall be
deemed to incorporate, and all references to "this Agreement" shall be deemed
to include, the Pricing Agreement.
The Company has filed with the Securities and Exchange
Commission (the "Commission") a registration statement on Form S-3 (No.
33-51131) and a related preliminary prospectus for the registration of the
Securities and associated rights to purchase preferred stock (the "Rights")
under the Securities Act of 1933, as amended (the "1933 Act"), and has filed
such amendments thereto, if any, and such amended preliminary prospectuses as
may have been required to the date hereof, and will file such additional
amendments thereto and such amended prospectuses as may hereafter be required.
Such registration statement (as amended, if applicable) and the prospectus
constituting a part thereof at the time such registration statement becomes
effective (including in each case all documents incorporated by reference
therein and the information, if any, deemed to be part thereof pursuant to Rule
430A(b) of the rules and regulations of the Commission under the 1933 Act (the
"1933 Act Regulations")), as from time to time amended or supplemented pursuant
to the 1933 Act, the Securities Exchange Act of 1934, as amended (the "1934
Act"), or otherwise, are hereinafter referred to as the "Registration
Statement" and the "Prospectus," respectively, except that if any revised
prospectus shall be provided to the Underwriters by the Company for use in
connection with the offering of the Securities and the associated Rights which
differs from the Prospectus on file at the Commission at the time the
Registration Statement becomes effective (whether or not such revised
prospectus is required to be filed by the Company pursuant to Rule 424(b) of
the 1933 Act Regulations), the terms "Prospectus" shall refer to each such
revised prospectus from and after the time it is first provided to the
Underwriters for such use. All references in this Agreement to financial
statements and schedules and other information which is "contained,"
"included," "described" or "stated" in the Registration Statement or the
Prospectus (and all other references of like import) shall be deemed to mean
and include all such financial statements and schedules and other information
which is or is deemed to be incorporated by reference in the Registration
Statement or the Prospectus, as the case may be; and all references in
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<PAGE> 4
this Agreement to amendments or supplements to the Registration Statement or
the Prospectus shall be deemed to mean and include the filing of any document
under the 1934 Act which is or is deemed to be incorporated by reference in the
Registration Statement or the Prospectus, as the case may be.
The Company and the Selling Shareholder understand that the
Underwriters propose to make a public offering of the Securities as soon as the
Representatives deem advisable after the Registration Statement becomes
effective and the Pricing Agreement has been executed and delivered.
SECTION 1. Representations and Warranties.
(a) The Company represents and warrants to each of the
Underwriters as of the date hereof and as of the date of the Pricing Agreement
(such latter date being hereinafter referred to as the "Representation Date")
as follows:
(i) At the time the Registration Statement
becomes effective and at the Representation Date, the Registration
Statement will comply in all material respects with the requirements of
the 1933 Act and the 1933 Act Regulations and will not contain an
untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading. The Prospectus, at the Representation Date
(unless the term "Prospectus" refers to a prospectus which has been
provided to the Underwriters by the Company for use in connection with
the offering of the Securities and the associated Rights which differs
from the Prospectus on file at the Commission at the time the
Registration Statement becomes effective, in which case at the time it
is first provided to the Underwriters for such use) and at Closing Time
and each Date of Delivery referred to in Section 2 hereof, will not
include an 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, however, that the representations and warranties in this
subsection shall not apply to statements in or omissions from the
Registration Statement or Prospectus made in reliance upon and in
conformity with information furnished to the Company in writing by the
Underwriters expressly for use in the Registration Statement or
Prospectus. The Company meets all conditions required for the use of
Form S-3 to effect the registration of the Securities and the
associated Rights under the Securities Act.
(ii) The accountants who audited the financial
statements and supporting schedules included in the Registration
Statement or incorporated by reference therein are independent public
accountants with respect to the Company and its subsidiaries as
required by the 1933 Act and the 1933 Act Regulations.
-3-
<PAGE> 5
(iii) The consolidated financial statements,
including the notes thereto, and supporting schedules included in the
Registration Statement or incorporated by reference therein present
fairly the consolidated financial position of the Company and its
subsidiaries as at the dates indicated and the consolidated results of
their operations and cash flows for the periods specified; except as
otherwise stated in the Registration Statement, said financial
statements have been prepared in conformity with generally accepted
accounting principles applied on a consistent basis throughout the
periods involved; and the supporting schedules included in the
Registration Statement or incorporated by reference therein present
fairly the information required to be stated therein. The selected
financial data included in the Registration Statement present fairly
the information shown therein and have been compiled on a basis
consistent with that of the audited consolidated financial statements
from which it was derived.
(iv) Since the respective dates as of which
information is given in the Registration Statement and the Prospectus,
except as otherwise stated therein, (A) there has been no material
adverse change in the condition, financial or otherwise, or in the
earnings, affairs or business prospects of the Company and its
subsidiaries considered as one enterprise, whether or not arising in
the ordinary course of business, and (B) there have been no
transactions entered into by the Company or any of its subsidiaries
other than those in the ordinary course of business, which are material
to the Company and its subsidiaries considered as one enterprise.
(v) The Company has been duly incorporated and is
validly existing as a corporation in good standing under the laws of
the State of Louisiana with corporate power and authority to own, lease
and operate its properties and conduct its business as described in the
Prospectus; and the Company is duly qualified as a foreign corporation
to transact business and is in good standing in all jurisdictions in
which such qualification is required, whether by reason of the
ownership or leasing of property or the conduct of business, except
where the failure so to qualify would not have a material adverse
effect on the condition, financial or otherwise, or the earnings,
business affairs or business prospects of the Company and its
subsidiaries considered as one enterprise.
(vi) No corporation in which the Company has an
interest constitutes a "significant subsidiary" of the Company as
defined in the 1933 Act Regulations.
(vii) Each partnership in which the Company has an
interest that constitutes a "significant subsidiary" of the Company as
defined in the 1933 Act Regulations is specified in Schedule B hereto
(the subsidiaries so specified being hereinafter collectively referred
to as the "Partnership Subsidiaries"). Each Partnership Subsidiary has
been duly formed and is validly existing as a partnership in good
standing under the laws of the jurisdiction of its formation and is
duly qualified as a foreign partnership to transact business and is in
good standing in all
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<PAGE> 6
jurisdictions in which such qualification is required, whether by
reason of the ownership or leasing of property or the conduct of
business, except where the failure so to qualify would not have a
material adverse effect on the condition, financial or otherwise, or
the earnings or business affairs of the Company and its subsidiaries
considered as one enterprise; all the outstanding partnership interests
in each Partnership Subsidiary have been duly authorized and validly
issued; and 75% of the general partnership interests in Kosmos Cement
Company are owned by the Company, directly or indirectly, free and
clear of any pledge, lien, encumbrance, claim or equity (except as
described in the Prospectus and except for liens granted to the lending
banks under the Company's Second Amended and Restated Credit Facility
dated as of November 19, 1993).
(viii) The Company had, at the date indicated, the
authorized, issued and outstanding capital stock as set forth in the
Prospectus under "Capitalization"; the shares of issued and outstanding
Common Stock, including the Securities to be sold by the Selling
Shareholder hereunder, have been duly authorized and validly issued and
are fully paid and nonassessable; the Rights associated with such
shares of Common Stock have been duly and validly issued by the Company
in accordance with the Rights Agreement dated as of March 4, 1991 (the
"Rights Agreement") between the Company and Chemical Shareholder
Services Group, Inc., successor to First City, Texas-Houston, N.A., as
Rights Agent; and the Common Stock and associated Rights conform to the
descriptions thereof contained in the Prospectus.
(ix) This Agreement has been duly and validly
authorized, executed and delivered by the Company.
(x) Neither the Company nor any of its
subsidiaries is in violation of its charter or by-laws or in default in
the performance or observance of any obligation, agreement, covenant or
condition contained in any contract, indenture, mortgage, loan
agreement, note, lease or other agreement or instrument to which it is
a party or by which it may be bound or to which any of its properties
may be subject, except for such defaults that would not have a material
adverse effect on the condition (financial or otherwise), earnings,
business affairs or business prospects of the Company and its
subsidiaries, considered as one enterprise. The execution and delivery
by the Company of this Agreement, the consummation by the Company of
the transactions contemplated herein and the transactions contemplated
in the Registration Statement relating to the sale of the Securities
and compliance by the Company with the terms of this Agreement have
been duly authorized by all necessary corporate action on the part of
the Company and do not and will not result in any violation of the
charter or by-laws of the Company or any of its subsidiaries, and do
not and will not conflict with, or result in a breach 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 under (A)
any indenture, mortgage, loan agreement, note, lease or
-5-
<PAGE> 7
other agreement or instrument to which the Company or any of its
subsidiaries is a party or by which it may be bound or to which any of
its properties may be subject (except for such conflicts, breaches or
defaults or liens, charges or encumbrances that would not have a
material adverse effect on the condition (financial or otherwise),
earnings, business affairs or business prospects of the Company and its
subsidiaries, considered as one enterprise) or (B) any existing
applicable law, rule, regulation, judgment, order or decree of any
government, governmental instrumentality or court, domestic or foreign,
having jurisdiction over the Company or any of its subsidiaries or any
of its properties (except for such violations, defaults, breaches or
liens that would not have a material adverse effect on the condition
(financial or otherwise), earnings, business affairs or business
prospects of the Company and its subsidiaries, considered as one
enterprise).
(xi) No labor dispute exists or to the knowledge
of the Company is imminent with the Company's employees or with
employees of any of its subsidiaries that reasonably could be expected
to materially and adversely affect the condition (financial or
otherwise), earnings, business affairs or business prospects of the
Company and its subsidiaries, considered as one enterprise.
(xii) Except as described in the Prospectus, there
is no action, suit or proceeding before or by any court or governmental
agency or body, domestic or foreign, now pending, or, to the knowledge
of the Company, threatened against the Company or any of its
subsidiaries that is required to be disclosed in the Registration
Statement, or that might reasonably be expected to (A) result in any
material adverse change in the condition, financial or otherwise, or
the earnings or business affairs of the Company and its subsidiaries,
considered as one enterprise, (B) materially and adversely affect the
properties or assets thereof or (C) materially and adversely affect the
consummation by the Company of its obligations pursuant to this
Agreement; and there are no contracts or documents of the Company or
any of its subsidiaries that are required to be filed as exhibits to
the Registration Statement by the 1933 Act or the 1933 Act Regulations
that have not been so filed.
(xiii) The documents incorporated by reference into
the Registration Statement (in whole or in part) or deemed to be
incorporated therein, when they were or hereafter are filed with the
Commission, complied with or will comply with the requirements of the
1934 Act, and the rules and regulations of the Commission under the
1934 Act (the "1934 Act Regulations"); such documents incorporated by
reference into the Registration Statement or deemed to be incorporated
therein, at the time such documents were filed with the Commission did
not contain an untrue statement of material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein in light of the circumstances in which they were
made not misleading, and no further documents hereafter incorporated by
reference into the Registration Statement or deemed to be incorporated
therein will contain an untrue statement of material fact or omit to
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<PAGE> 8
state a material fact required to be stated therein or necessary to
make the statements therein in light of the circumstances in which they
were made not misleading.
(xiv) No authorization, approval, consent or
license of any domestic government, governmental instrumentality or
court is necessary in connection with the offering or the sale of the
Securities hereunder or the consummation of the transactions
contemplated by this Agreement, except such as may be required under
the 1933 Act, the 1933 Act Regulations, the 1934 Act, the 1934 Act
Regulations or state securities or blue sky laws.
(xv) Except as described in the Prospectus, the
Company and its subsidiaries possess such licenses, permits, consents,
orders, certificates or authorizations issued by the appropriate
federal, state, local or foreign regulatory agencies or bodies
currently necessary to conduct their respective businesses as now
operated by them, except where the lack thereof would not have a
material adverse effect on the Company and its subsidiaries considered
as one enterprise, and neither the Company nor its subsidiaries have
received any notice of proceedings relating to the revocation or
modification of any such licenses, permits, consents, orders,
certificates or authorizations in which the Company reasonably expects
decisions, rulings or findings that, individually or in the aggregate,
would have a material and adverse effect on the condition, financial or
otherwise, or the earnings, business affairs or business prospects of
the Company and its subsidiaries considered as one enterprise.
(xvi) The Company, has not taken, directly or
indirectly, any action designed to cause or result in, or which has
constituted, stabilization or manipulation of the price of any security
of the Company in order to facilitate the sale or resale of the
Securities and the associated Rights.
(xvii) Except as described in the Registration
Statement, no holder of securities of the Company has any rights to
require the registration of such securities under the 1933 Act as a
result of the filing of the Registration Statement or in connection
with the offering of the Securities and the associated Rights.
(xviii) Except as described in the Prospectus, there
has been no storage, disposal, generation, manufacture, spill,
discharge, refinement, transportation, handling or treatment of toxic
wastes, medical wastes, hazardous wastes or hazardous substances by the
Company or any of its subsidiaries at, upon or from any of the property
now or previously owned or leased or under contract for purchase by the
Company or any of its subsidiaries in violation of any applicable law,
ordinance, rule, regulation, order, judgment, decree or permit or which
would require remedial action under any applicable law, ordinance,
rule, regulation, order, judgment, decree or permit, except for any
violation or remedial action which the Company reasonably
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<PAGE> 9
believes would not be reasonably likely to result in, individually or
in the aggregate with all such violations and remedial actions, a
material and adverse effect on the condition, financial or otherwise,
or the earnings or business affairs of the Company and its subsidiaries
considered as one enterprise; and the terms "hazardous wastes," "toxic
wastes," "hazardous substances" and "medical wastes" shall have the
meanings specified in any applicable local, state, federal and foreign
laws or regulations with respect to environmental protection.
(b) The Selling Shareholder represents and warrants to,
and agrees with, each of the Underwriters as follows:
(i) The execution and delivery of this Agreement
and the consummation of the transactions herein contemplated will not
result in a breach by the Selling Shareholder of, or constitute a
default by the Selling Shareholder under, any indenture, deed of trust,
contract, or other agreement or instrument or any decree, judgment or
order to which Selling Shareholder is a party or by which the Selling
Shareholder may be bound.
(ii) The Selling Shareholder is, and immediately
prior to Closing Time, will be, the sole registered owner of the
Securities; the Selling Shareholder has good and marketable title to
the Securities, free and clear of any mortgage, pledge, lien, security
interest, encumbrance, claim or equity, and has full power, right and
authority to sell, transfer and deliver such Securities under this
Agreement; upon completion of the Closing, each of the Underwriters
will be the registered owner of the Securities purchased by it from the
Selling Shareholder and, assuming the Underwriters purchased the
Securities for value in good faith and without notice of any adverse
claim, the Underwriters will have acquired all rights of the Selling
Shareholder in the Securities free and clear of any pledge, lien,
security interest, encumbrance, claim or equity.
(iii) All authorizations, approvals and consents
necessary for the execution and delivery by the Selling Shareholder of
this Agreement and the sale and delivery of the Securities have been
obtained and are in full force and effect; and the Selling Shareholder
has the full right, power and authority to enter into this Agreement
and the Pricing Agreement and to sell, transfer and deliver the
Securities.
(iv) The Selling Shareholder has not taken, and
will not take, directly or indirectly, any action that is designed to
cause or result in, or which has constituted, stabilization or
manipulation of the price of any security of the Company to facilitate
the sale or resale of the Securities.
(v) The Selling Shareholder, having conducted no
inquiry in connection with the preparation of the Registration
Statement or the Prospectus, has
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<PAGE> 10
read the Registration Statement and the Prospectus contained therein
and has no knowledge of any fact, condition or information not
disclosed in the Prospectus that has materially adversely affected or
might be expected to materially adversely affect the condition,
financial or otherwise, or the earnings, business affairs or business
prospects of the Company and its subsidiaries considered as one
enterprise; and the Selling Shareholder is not prompted to sell the
Securities by any information concerning the Company or any subsidiary
of the Company that is not set forth in the Registration Statement or
the Prospectus.
(vi) The Selling Shareholder agrees with each of the
Underwriters that the Selling Shareholder shall not offer for sale,
sell, grant an option for the sale of, or otherwise dispose of,
directly or indirectly, without the prior written consent of Merrill
Lynch, any shares of Common Stock or any securities convertible into or
exchangeable into or exercisable for Common Stock owned by the Selling
Shareholder or with respect to which the Selling Shareholder has the
power of disposition, for a period of 90 days from the date of the
Pricing Agreement.
(c) Any certificate signed by any officer of the Company
or any of its subsidiaries, as the case may be, and delivered to the
Representatives or to counsel for the Underwriters in connection with the
closing of the sale of the Securities to the Underwriters hereunder shall be
deemed a representation and warranty by the Company or any such subsidiary, as
the case may be, to each Underwriter as to the matters covered thereby; and any
certificate signed by or on behalf of the Selling Shareholder and delivered to
the Representatives or to counsel for the Underwriters in connection with the
closing of the sale of the Securities to the Underwriters hereunder shall be
deemed a representation and warranty by the Selling Shareholder to each
Underwriter as to the matters covered thereby.
SECTION 2. Sale and Delivery to Underwriters; Closing.
(a) On the basis of the representations and warranties
herein contained and subject to the terms and conditions herein set forth, the
Selling Shareholder agrees to sell to each Underwriter, severally and not
jointly, and each Underwriter, severally and not jointly, agrees to purchase
from the Selling Shareholder, at the price per share set forth in the Pricing
Agreement, the number of Initial Securities set forth in Schedule A opposite
the name of such Underwriter (except as otherwise provided in the Pricing
Agreement) plus any additional number of Initial Securities that such
Underwriter may become obligated to purchase pursuant to the provisions of
Section 10 hereof, subject, in each case, to such adjustments as the
Representatives in their discretion shall make to eliminate any sales or
purchases of fractional securities.
In addition, on the basis of the representations and
warranties herein contained and subject to the terms and conditions herein set
forth, the Selling Shareholder hereby grants an option to the Underwriters,
severally and not jointly, to purchase from it up to an additional 232,500
shares of Common Stock, at the purchase price per share set
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<PAGE> 11
forth in the Pricing Agreement. The option hereby granted will expire on the
30th day after the date the Registration Statement becomes effective or, if the
Company has elected to rely on Rule 430A of the 1933 Act Regulations, the 30th
day after the Representation Date, and may be exercised in whole or in part
from time to time only for the purpose of covering over-allotments which may be
made in connection with the offering and distribution of the Initial
Securities, upon notice by the Representatives to the Selling Shareholder and
the Company setting forth the number of Option Securities as to which the
Underwriters are then exercising the option and the time, date, and place of
payment and delivery for such Option Securities. Any such time and date of
delivery for the Option Securities (a "Date of Delivery") shall be determined
by the Representatives but shall be not later than seven full business days
after the exercise of said option, nor in any event prior to Closing Time (as
hereinafter defined) unless otherwise agreed upon by the Representatives, the
Selling Shareholder and the Company. If the option is exercised as to all or
any portion of the Option Securities, each of the Underwriters, acting
severally and not jointly, will purchase from the Selling Shareholder that
proportion of the number of Option Securities that the number of Initial
Securities set forth in Schedule A opposite the name of such Underwriter (plus
any additional number of Initial Securities which such Underwriter may become
obligated to purchase pursuant to the provisions of Section 10 hereof) bears to
the total number of Initial Securities (except as otherwise provided in the
Pricing Agreement), subject, in each case, to such adjustments as the
Representatives in their discretion shall make to eliminate any sales or
purchases of fractional securities.
(i) If the Company has elected not to rely upon
Rule 430A of the 1933 Act Regulations, the initial public offering
price of the Securities and the purchase price per share to be paid by
the several Underwriters for the Securities shall have each been
determined and set forth in the Pricing Agreement, dated the date
hereof, and an amendment to the Registration Statement and the
Prospectus will be filed before the Registration Statement becomes
effective.
(ii) If the Company has elected to rely upon Rule
430A of the 1933 Act Regulations, the purchase price per share to be
paid by the several Underwriters for the Securities shall be an amount
equal to the initial public offering price, less an amount per share to
be determined by agreement between the Representatives and the Selling
Shareholder. The initial public offering price per share of the
Securities shall be a fixed price to be determined by agreement between
the Representatives and the Selling Shareholder. The initial public
offering price per share and the purchase price, when so determined,
shall be set forth in the Pricing Agreement. In the event that such
prices have not been agreed upon and the Pricing Agreement has not been
executed and delivered by the parties thereto by the close of business
on the fourth business day following the date of this Agreement, this
Agreement shall terminate forthwith, without liability of any party to
any other party, unless otherwise agreed to by the Company, the Selling
Shareholder and the Representatives.
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<PAGE> 12
(b) Payment of the purchase price for, and delivery of
certificates for, the Initial Securities to be purchased by the Underwriters,
shall be made at the office of Baker & Botts, L.L.P., 910 Louisiana, Houston,
Texas or at such other place as shall be agreed upon by the Representatives,
the Company and the Selling Shareholder, at 10:00 A.M., New York City time, on
the fifth business day (unless postponed in accordance with the provisions of
Section 10 hereof) following the date of the execution of the Pricing Agreement
or such other time not later than ten business days after such date as shall be
agreed upon by the Representatives, the Company and the Selling Shareholder
(such time and date of payment and delivery being herein called "Closing
Time"). In addition, in the event that any or all of the Option Securities are
purchased by the Underwriters, payment of the purchase price for, and delivery
of certificates for, such Option Securities shall be made at the
above-mentioned office of Baker & Botts, L.L.P. or at such other place as shall
be mutually agreed upon by the Representatives, the Selling Shareholder and the
Company, on each Date of Delivery as specified in the notice from the
Representatives to the Selling Shareholder and the Company. Payment shall be
made to the Selling Shareholder by certified or official bank check or checks
drawn in New York Clearing House funds or similar next-day funds payable to the
order of the Selling Shareholder against delivery to Representatives for the
respective accounts of the Underwriters of certificates for the Securities to
be purchased by them. Certificates for the Initial Securities and the Option
Securities shall be in such denominations and registered in such names as the
Representatives may request in writing at least two business days before
Closing Time or the Date of Delivery, as the case may be. It is understood
that each Underwriter has authorized the Representatives, for its account, to
accept delivery of, receipt for, and make payment of the purchase price for,
the Securities that it has agreed to purchase. Merrill Lynch, individually and
not as representative of the Underwriters, may (but shall not be obligated to)
make payment of the purchase price for the Securities to be purchased by any
Underwriter whose check has not been received by Closing Time or the Date of
Delivery, as the case may be, but such payment shall not relieve such
Underwriter from its obligations hereunder. The certificates for the Initial
Securities and the Option Securities to be purchased by the Underwriters will
be made available in New York City for examination and packaging by the
Representatives not later than 10:00 A.M. on the last business day prior to
Closing Time or the Date of Delivery, as the case may be.
SECTION 3. Covenants of the Company. The Company covenants
with each of the Underwriters as follows:
(a) The Company will notify the Representatives
immediately, and confirm the notice in writing, (i) of the effectiveness of the
Registration Statement and any amendment thereto (including any post-effective
amendment), (ii) of the receipt of any comments from the Commission, (iii) of
any request by the Commission for any amendment to the Registration Statement
or any amendment or supplement to the Prospectus or for additional information,
and (iv) of the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or the initiation of any
proceedings for that purpose. The Company will make every reasonable effort to
prevent
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<PAGE> 13
the issuance of any stop order and, if any stop order is issued, to obtain the
lifting thereof at the earliest possible moment.
(b) The Company will give the Representatives notice of
its intention to file or prepare any amendment to the Registration Statement
(including any post-effective amendment) or any amendment or supplement to the
Prospectus (including any revised prospectus which the Company proposes for use
by the Underwriters in connection with the offering of the Securities which
differs from the prospectus on file at the Commission at the time the
Registration Statement becomes effective, whether or not such revised
prospectus is required to be filed pursuant to Rule 424(b) of the 1933 Act
Regulations) whether pursuant to the 1933 Act, the 1934 Act or otherwise, will
furnish the Representatives with copies of any such amendment or supplement a
reasonable amount of time prior to such proposed filing or use, as the case may
be, and will not file any such amendment or supplement or use any such
prospectus to which the Underwriters shall reasonably object.
(c) The Company will deliver to the Representatives as
many signed copies of the Registration Statement as originally filed and each
amendment thereto (including exhibits filed therewith or incorporated by
reference therein and documents incorporated or deemed to be incorporated by
reference therein) as the Representatives may reasonably request and will also
deliver to the Representatives a conformed copy of the Registration Statement
as originally filed and of each amendment thereto (without exhibits) for each
of the Underwriters.
(d) The Company will furnish to each Underwriter, from
time to time during the period when the Prospectus is required to be delivered
under the 1933 Act or 1934 Act, such number of copies of the Prospectus (as
amended or supplemented) as such Underwriter may reasonably request for the
purposes contemplated by the 1933 Act, the 1933 Act Regulations, the 1934 Act
or the 1934 Act Regulations.
(e) If at any time any event shall occur as a result of
which it is necessary, in the opinion of the Underwriters, to amend or
supplement the Prospectus in order that the Prospectus not include an untrue
statement of a material fact or omit to state a material fact necessary to make
the statements therein not misleading in the light of the circumstances
existing at the time it is delivered to a purchaser, the Company will forthwith
amend or supplement the Prospectus (in form and substance satisfactory to the
Underwriters) and furnish to the Underwriters a reasonable number of copies of
any amendment or amendments of or supplement or supplements to, the Prospectus,
so that, as so amended or supplemented, the Prospectus will not contain such
untrue statement or omission.
(f) The Company, during the period when the Prospectus is
required to be delivered under the 1933 Act, will file promptly all documents
required to be filed with the Commission pursuant to Section 13, 14 or 15 of
the 1934 Act subsequent to the time the Registration Statement becomes
effective.
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<PAGE> 14
(g) The Company will use its best efforts to qualify the
Securities and the associated Rights for offering and sale under the applicable
securities laws of such states and other jurisdictions as the Representatives
may designate; provided, however, that the Company shall not be obligated to
file any general consent to service of process or to qualify as a foreign
corporation in any jurisdiction in which it is not so qualified or to subject
itself to taxation in respect of doing business in any jurisdiction in which it
is not otherwise so subject. The Company will file such statements and reports
as may be required by the laws of each jurisdiction in which the Securities and
the associated Rights have been qualified as above provided.
(h) The Company will make generally available to its
security holders as soon as practicable, but not later than 90 days after the
close of the period covered thereby, an earnings statement (in form complying
with the provisions of Rule 158 of the 1933 Act Regulations) covering a
12-month period beginning not later than the first day of the Company's fiscal
quarter next following the "effective date" (as defined in said Rule 158) of
the Registration Statement.
(i) If, at the time that the Registration Statement
becomes effective, any information shall have been omitted therefrom in
reliance upon Rule 430A of the 1933 Act Regulations, then immediately following
the execution of the Pricing Agreement, the Company will prepare, and file or
transmit for filing with the Commission in accordance with such Rule 430A and
Rule 424(b) of the 1933 Act Regulations, copies of an amended Prospectus, or,
if required by such Rule 430A, a post-effective amendment to the Registration
Statement (including an amended Prospectus), containing all information so
omitted.
(j) During a period of 90 days from the date of the
Pricing Agreement, the Company will not, without the prior written consent of
Merrill Lynch, directly or indirectly, sell, offer to sell, grant any option
for the sale of, or otherwise dispose of, any Common Stock and associated
Rights or any security convertible into, exchangeable into or exercisable for
Common Stock (except for the shares of Preferred Stock, Cumulative Convertible
Series D, of the Company to be issued and sold by the Company pursuant to the
Purchase Agreement of even date herewith between the Company and the
Representatives, shares of Common Stock and associated Rights issuable upon
conversion of convertible securities or exercise of currently outstanding
warrants to purchase Common Stock, securities issuable upon the exercise of
Rights, any shares of Common Stock and associated Rights issuable pursuant to
exercise of options or similar rights granted to directors, officers or
employees and any other interests in shares of Common Stock and associated
Rights granted in connection with any other employee benefit plans of the
Company).
SECTION 4. Payment of Expenses. As between the Company and
the Underwriters, the Company will pay or cause to be paid and bear or cause to
be borne all costs and expenses incident to the performance of its obligations
under this Agreement,
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<PAGE> 15
including (i) the printing and filing of the Registration Statement as
originally filed and of each amendment thereto and the cost of furnishing
copies thereof to the Underwriters, (ii) the preparation, issuance and delivery
of the Securities to the Underwriters, (iii) the fees and disbursements of the
Company's counsel and accountants, (iv) the expenses in connection with the
qualification of the Securities under state securities laws in accordance with
the provisions of Section 3(g) hereof, including filing fees and the fees and
disbursements of counsel for the Underwriters in connection therewith and in
connection with the preparation of the Blue Sky Memorandum, (v) the printing
and delivery to the Underwriters of copies of each of the preliminary
prospectuses, and of the Prospectus and any amendments or supplements thereto,
(vi) the delivery to the Underwriters of copies of Blue Sky Memorandum, and
(vii) the fees and expenses incurred in connection with any filings required to
be made by the Underwriters with the National Association of Securities
Dealers, Inc.
If this Agreement is terminated by the Representatives in
accordance with the provisions of Section 5 or Section 9(a)(i) hereof, the
Company shall reimburse the Underwriters for all of their out-of-pocket
expenses, including the reasonable fees and disbursements of counsel for the
Underwriters.
The provisions of this Section shall not affect any agreement
between the Company and the Selling Shareholder regarding the allocation or
sharing of such expenses and costs.
SECTION 5. Conditions of Obligations of the Underwriters.
The obligations of the Underwriters hereunder are subject to the accuracy of
the representations and warranties of the Company and the Selling Shareholder
herein contained at the date hereof and at Closing Time, to the performance by
the Company and the Selling Shareholder of their respective obligations
hereunder required to be performed prior to Closing Time, and to the following
further conditions:
(a) The Registration Statement shall have become effective
not later than 5:30 P.M. on the date hereof or at such later time and date as
may be approved by the Representatives; and at Closing Time and any Date of
Delivery, as the case may be, no stop order suspending the effectiveness of the
Registration Statement shall have been issued under the 1933 Act or proceedings
therefor initiated or threatened by the Commission. If the Company has elected
to rely upon Rule 430A of the 1933 Act Regulations, the initial public offering
price per share of the Securities, the purchase price per share to be paid by
the Underwriters, and any other price-related information previously omitted
from the effective Registration Statement pursuant to such Rule 430A shall have
been transmitted to the Commission for filing pursuant to Rule 424(b) of the
1933 Act Regulations within the prescribed time period, and prior to Closing
Time the Company shall have provided evidence satisfactory to the
Representatives of such timely filing, or a post-effective amendment providing
such information shall have been promptly filed and declared effective in
accordance with the requirements of Rule 430A of the 1933 Act Regulations.
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<PAGE> 16
(b) At Closing Time the Representatives shall have
received:
(1) The favorable opinion, dated as of Closing Time, of
Bracewell & Patterson, L.L.P, counsel for the Company, in form and
substance reasonably satisfactory to the Representatives, to the effect
that:
(i) The Company is a corporation duly
incorporated, validly existing and in good standing under the
laws of the State of Louisiana.
(ii) The Partnership Subsidiary identified on
Schedule B hereto (the "Designated Partnership Subsidiary") is
a general partnership duly formed and validly existing under
the laws of the Commonwealth of Kentucky.
(iii) Each of the Company and the Designated
Partnership Subsidiary has all requisite corporate or
partnership power, as the case may be, to own and lease its
properties and to conduct its business as described in the
Prospectus and, to the best of their knowledge after due
inquiry is duly qualified as a foreign corporation or
partnership, as the case may be, to transact business and is
in good standing in each jurisdiction in which such
qualification is required, except where the failure so to
qualify would not have a material adverse effect on the
condition, financial or otherwise, or the earnings, business
affairs or business prospects of the Company and its
subsidiaries considered as one enterprise; to the best of
their knowledge after due inquiry, the Company owns 75% of the
general partnership interests in the Designated Partnership
Subsidiary.
(iv) All of the issued and outstanding shares of
capital stock of the Company have been duly and validly
authorized and issued and are fully paid, nonassessable and
free of preemptive rights. The Company's authorized capital
stock is as set forth in the Prospectus. At the close of
business on December 31, 1993, 17,045,809 shares of Common
Stock were outstanding, 1,999,000 shares of Series A Preferred
Stock were outstanding, 959,000 shares of Series B Preferred
Stock were outstanding, no shares of Series C Preferred Stock
or Series D Preferred Stock were outstanding, and there were
outstanding options or warrants to acquire 2,728,022 shares of
Common Stock. The shares of Common Stock issuable upon
conversion of the Series A Preferred Stock, the Series B
Preferred Stock, the Series D Preferred Stock and such options
or warrants have been duly reserved for issuance upon exercise
or conversion thereof. Except for the Series A Preferred
Stock, the Rights, the Series B Preferred Stock, the 7 1/2%
Convertible Subordinated Debentures Due 2013 issuable in
exchange for the Series B Preferred Stock, the Series C
Preferred Stock, the Series D Preferred Stock, this Agreement,
the warrants to purchase Common Stock and options to purchase
Common Stock pursuant to various stock option plans of the
Company described in the
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<PAGE> 17
Prospectus or described in or attached as an exhibit to
a document that is incorporated by reference in the
Prospectus, to the best of their knowledge after due inquiry
there are no (i) outstanding securities convertible into or
exchangeable for shares of capital stock of the Company or
(ii) contracts, commitments, agreements, understandings or
arrangements of any kind to which the Company is a party
obligating the Company to issue any capital stock, any
securities convertible into or exchangeable for, or rights to
purchase or subscribe for capital stock of the Company.
(v) This Agreement has been duly authorized,
executed and delivered by the Company.
(vi) The Registration Statement has become
effective under the 1933 Act and, to the best of their
knowledge after due inquiry, no stop order suspending the
effectiveness of the Registration Statement has been issued
under the 1933 Act and no proceeding for that purpose has been
initiated or threatened by the Commission.
(vii) The Registration Statement, as of its
effective date, and the Prospectus, as of its date, and any
supplements or amendments thereto, as of their respective
dates, (other than the financial statements and schedules and
other financial and statistical data included or incorporated
by reference therein, as to which no opinion need be rendered)
appeared on their face to comply as to form in all material
respects with the requirements of the 1933 Act and the 1933
Act Regulations.
(viii) The Common Stock conforms as to legal matters
in all material respects to the description thereof contained
under the caption "Description of Capital Stock" in the
Prospectus, and the form of certificate used to evidence the
Common Stock is in due and proper form and complies with all
applicable statutory requirements of the Louisiana Business
Corporation Law.
(ix) To the best of their knowledge after due
inquiry, there are no legal or governmental proceedings
pending or threatened that are required to be disclosed in the
Registration Statement other than those disclosed therein (or
in a document incorporated by reference or deemed to be
incorporated by reference therein).
(x) Such counsel is not aware of any
authorization, approval, consent or order of any court or
governmental authority or agency that is required to be
obtained by the Company in connection with the offering of the
Securities to the Underwriters, except such as may be required
under the 1933 Act or the 1933 Act Regulations or the 1934 Act
or the 1934 Act Regulations or state securities law (or as
expressly contemplated in this
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<PAGE> 18
Agreement); and, to the best of their knowledge after due
inquiry, the execution, delivery and performance by the
Company of its obligations under this Agreement and the
consummation of the transactions contemplated herein and
compliance by the Company with its obligations hereunder will
not conflict with or constitute a breach of, or 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 contract, indenture,
mortgage, loan agreement, note, lease or other instrument to
which the Company or any of its subsidiaries is a party or by
which it or any of them may be bound, or to which any of the
property or assets of the Company or any of its subsidiaries
is subject, nor will such action result in any violation of
the provisions of the charter or by-laws of the Company, or
any applicable law, administrative regulation or
administrative or court decree which breach, default,
imposition or violation would have a material adverse effect
on the financial condition, business affairs or business
prospects of the Company and its subsidiaries considered as
one enterprise.
(xi) To the best of their knowledge after due
inquiry, there are no contacts, indentures, mortgages, loan
agreements, notes, leases or other instruments required to be
described or referred to in the Registration Statement or to
be filed or incorporated by reference as exhibits thereto
other than those described or referred to in the Registration
Statement or filed as exhibits thereto; and the descriptions
thereof or references thereto are correct in all material
respects.
(xii) To the best their knowledge after due
inquiry, no holder of securities of the Company has rights to
the registration under the 1933 Act of securities of the
Company because of the filing of the Registration Statement
that have not been waived.
In rendering the foregoing opinion or opinions, Bracewell &
Patterson, L.L.P. may state that such opinion or opinions are limited
to the federal laws of the United States, the laws of the State of
Texas and the Louisiana Business Corporation Law, and that they are
relying (i) as to matters governed by the laws of the State of
Louisiana, upon the favorable opinion, dated as of Closing Time, of
Stone, Pigman, Walther, Wittmann & Hutchinson, Louisiana counsel to the
Company, in form and substance satisfactory to the Representatives, and
(ii) as to matters governed by the laws of any other jurisdiction upon
the favorable opinion, dated as of Closing Time, of other counsel
acceptable to the Representatives, in form and substance satisfactory
to the Representatives; provided in each case that the Representatives
shall have been delivered original signed copies of each such opinion.
(2) The favorable opinion, dated as of the Closing Time,
of Wilmer, Cutler & Pickering, counsel for the Selling Shareholder, in
form and substance reasonably
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<PAGE> 19
satisfactory to the Representatives, to the effect that this Agreement
and the Pricing Agreement have each been duly and validly authorized,
executed and delivered by the Selling Shareholder and, to the best
knowledge and information of such counsel after due inquiry, the
Selling Shareholder has good and marketable title to the Initial
Securities to be sold by the Selling Shareholder hereunder, free and
clear of any mortgage, pledge, lien, security interest, encumbrance or
claim and full power, right and authority to sell such Securities
without breach or violation of or default under any applicable law,
administrative regulation or any administrative or court decree or
agreement to which the Selling Shareholder is subject.
(3) The favorable opinion, dated as of Closing Time, of
Baker & Botts, L.L.P., counsel for the Underwriters, with respect to
the matters set forth in (i), (v), (vi), (vii) and (viii) of subsection
(b)(1) of this Section. In rendering such opinion or opinions, Baker &
Botts, L.L.P. may state that such opinion or opinions are limited to
the federal laws of the United States, the laws of the State of Texas
and the Louisiana Business Corporation Law, and may state that they are
relying as to matters governed by the laws of any other jurisdiction
upon the favorable opinion of other counsel in substantially the same
manner as described in subsection (b)(1) of this Section.
(4) The written advice of Bracewell & Patterson, L.L.P. to
the effect that nothing has come to their attention that causes them to
believe that the Registration Statement, at the time it became
effective, contained an untrue statement of a material fact or omitted
to state a material fact required to be stated therein or necessary to
make the statements therein not misleading or that the Prospectus, at
the Representation Date (unless the term "Prospectus" refers to a
prospectus which has been provided to the Underwriters by the Company
for use in connection with the offering of the Securities which differs
from the Prospectus on file at the Commission at the time the
Registration Statement becomes effective, in which case at the time it
is first provided to the Underwriters for such use) or at Closing Time,
contained or contains an untrue statement of a material fact or omitted
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; it being understood that such counsel need
give no such advice as to the financial statements and schedules or
other financial or statistical data contained or incorporated by
reference in the Registration Statement or the Prospectus.
(5) The written advice of Wilmer, Cutler & Pickering to
the effect that nothing has come to its attention that causes it to
believe that any information about the Selling Shareholder in the
Registration Statement, at the time it became effective or at the
Representation Date, or the Prospectus, at the Representation Date
(unless the term "Prospectus" refers to a prospectus which has been
provided to the Underwriters by the Company for use in connection with
the offering of the Securities which differs from the Prospectus on
file at the Commission at the time
-18-
<PAGE> 20
the Registration Statement becomes effective, in which case at the time
it is first provided to the Underwriters for such use) or at Closing
Time, contained an untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which
they were made, not misleading.
(c) At Closing Time, except as described in or
contemplated by the Prospectus, there shall not have been, since the date
hereof or since the respective dates as of which information is given in the
Registration Statement and the Prospectus, any material adverse change in the
condition, financial or otherwise, or the earnings, business affairs or
business prospects of the Company or its subsidiaries considered as one
enterprise, whether or not in the ordinary course of business, and the
Representatives shall have received a certificate of the President or any Vice
President of the Company and of the chief financial or chief accounting officer
of the Company, dated as of Closing Time, to the effect that (i) there has been
no such material adverse change, (ii) the representations and warranties of the
Company contained in Section 1(a) of this Agreement are true and correct with
the same force and effect as though expressly made at and as of Closing Time,
(iii) the Company has complied with all agreements and satisfied all conditions
on its part to be performed or satisfied at or prior to Closing Time, and (iv)
no stop order suspending the effectiveness of the Registration Statement has
been issued and no proceedings for that purpose have been initiated or
threatened by the Commission.
(d) At the time of the execution of this Agreement, the
Representatives shall have received from Deloitte & Touche a letter dated such
date, in form and substance satisfactory to the Representatives, to the effect
that (i) they are independent public accountants with respect to the Company
and its subsidiaries within the meaning of the 1933 Act and the 1933 Act
Regulations; (ii) it is their opinion that the consolidated financial
statements and supporting schedules included in the Registration Statement and
covered by their opinions therein comply as to form in all material respects
with the applicable accounting requirements of the 1933 Act and the 1933 Act
Regulations; (iii) based upon limited procedures set forth in detail in such
letter, nothing has come to their attention that causes them to believe that
(A) the unaudited and other financial information of the Company and its
subsidiaries included in the Registration Statement or incorporated by
reference therein does not comply as to form in all material respects with the
applicable accounting requirements of the 1933 Act and the 1933 Act Regulations
or is not presented in conformity with generally accepted accounting principles
applied on a basis substantially consistent with that of the audited
consolidated financial statements included in the Registration Statement or
incorporated by reference therein, or (B) at a specified date not more than
five days prior to the date of the Pricing Agreement, there has been any change
in the capital stock of the Company or any increase in the consolidated long
term debt of the Company and its subsidiaries or any decrease in consolidated
net current assets or net assets as compared with the amounts shown in the
September 30, 1993 balance sheet included in the Registration Statement or
incorporated by reference therein or, during the period from September 30, 1993
to a specified date not more than five days prior to the
-19-
<PAGE> 21
date of the Pricing Agreement, there were any decreases, as compared with the
corresponding period in the preceding year, in consolidated revenues, net
income or net income per share of the Company and its subsidiaries, except in
all instances for changes, increases or decreases which the Registration
Statement and the Prospectus disclose have occurred or may occur and for
changes, increases or decreases set forth in such letter, in which case the
letter shall be accompanied by an explanation by the Company as to the
significance thereof unless said explanation is not deemed necessary by the
Representatives; and (iv) in addition to the examination referred to in their
opinions and the limited procedures referred to in clause (iii) above, they
have carried out certain specified procedures, not constituting an audit, with
respect to certain amounts, percentages and financial information which are
included in the Registration Statement and Prospectus and which are specified
by the Representatives, and have found such amounts, percentages and financial
information to be in agreement with the relevant accounting, financial and
other records of the Company and its subsidiaries identified in such letter.
(e) At Closing Time the Representatives shall have
received from Deloitte & Touche a letter, dated as of Closing Time to the
effect that they confirm the statements made in the letter furnished pursuant
to subsection (d) of this Section, except that the specified date referred to
in such letter shall be a date not more than five days prior to Closing Time.
(f) At Closing Time counsel for the Underwriters shall
have been furnished with such documents and opinions as they may require for
the purpose of enabling them to pass upon the issuance and sale of the
Securities as herein contemplated and related proceedings, or in order to
evidence the accuracy of any of the representations or warranties, or the
fulfillment of any of the conditions, herein contained; and all proceedings
taken by the Company and the Selling Shareholder in connection with the
issuance and sale of the Securities as herein contemplated shall be reasonably
satisfactory in form and substance to the Representatives.
(g) At Closing Time all actions, proceedings, instruments,
opinions and documents required in connection with the consummation of the
transactions contemplated by this Agreement shall be reasonably satisfactory to
the Representatives, and the Company shall have delivered to the
Representatives such other certificates and documents as the Representatives
shall reasonably request.
(h) At Closing Time the Representatives shall have
received a certificate from the Selling Shareholder, dated as of the Closing
Time, to the effect that (i) the representations and warranties of the Selling
Shareholder contained in Section 1(b) are true and correct with the same force
and effect as though expressly made at and as of Closing Time and (ii) the
Selling Shareholder has complied with all agreements and satisfied all
conditions on its part to be performed or satisfied at or prior to Closing
Time.
-20-
<PAGE> 22
(i) At Closing Time, the Company shall have furnished to
the Representatives "lock-up" letters, in form and substance reasonably
satisfactory to the Representatives, signed by each of the directors and
officers of the Company whose names are set forth in Schedule C hereto,
pursuant to which each such person shall agree not to offer for sale, sell,
grant an option for the sale of, or otherwise dispose of, directly or
indirectly, without the prior written consent of Merrill Lynch, any shares of
Common Stock or any securities convertible into or exchangeable into or
exercisable for Common Stock owned by such person or with respect to which such
person has the power of disposition, for a period of 90 days from the date of
the Pricing Agreement (except for shares of Common Stock and the associated
Rights issuable upon the exercise of options or similar rights granted by the
Company to such person as a director, officer or employee and any other
interests in shares of Common Stock and the associated Rights granted to such
person in connection with any other employee benefit plans of the Company).
(j) In the event the Underwriters exercise their option
provided in Section 2 hereof to purchase all or any part of the Option
Securities, and the Date of Delivery specified by the Representatives for any
such purchase is a date other than Closing Time, the obligation of the
Underwriters to purchase all or any such portion of the Option Securities shall
be subject, in addition to the foregoing conditions, to the accuracy of the
representations and warranties of the Company and the Selling Shareholder,
respectively, at each Date of Delivery, to the performance by the Company and
the Selling Shareholder, respectively, of its obligations hereunder required to
be performed prior to each Date of Delivery, and to the receipt by the
Representatives of the following:
(1) A certificate, dated such Date of Delivery, of the
President or any Vice President of the Company and of the chief
financial or chief accounting officer of the Company confirming that
the certificate delivered at Closing Time pursuant to subsection (c) of
this Section remains true as of such Date of Delivery.
(2) A certificate from the Selling Shareholder, dated such
Date of Delivery, confirming that the certificate delivered at the
Closing Time pursuant to subsection (h) of this Section remains true as
of such Date of Delivery.
(3) The favorable opinion of Bracewell & Patterson,
L.L.P., counsel for the Company, in form and substance reasonably
satisfactory to the Representatives, dated such Date of Delivery, to
the same effect as the opinion required by Section 5(b)(1) hereof and
the written advice required by Section 5(b)(4) hereof, together with
original signed copies of any opinion of other counsel whose opinion
has been relied upon by Bracewell & Patterson, L.L.P.
(4) The favorable opinion of Wilmer, Cutler & Pickering,
counsel for the Selling Shareholder, in form and substance reasonably
satisfactory to the Representatives, dated such Date of Delivery,
relating to the Option Securities and
-21-
<PAGE> 23
otherwise to the same effect as the opinion required by Section 5(b)(2)
hereof and the written advice required by Section 5(b)(5) hereof.
(5) The favorable opinion of Baker & Botts, L.L.P.,
counsel for the Underwriters, dated such Date of Delivery, relating to
the Option Securities and otherwise to the same effect as the opinion
required by Section 5(b)(3) hereof.
(6) A letter, dated as of such Date of Delivery, from
Deloitte & Touche, in form and substance satisfactory to the
Representatives, substantially the same in scope and substance as the
letter furnished pursuant to Section 5(d) hereof, except that the
"specified date" in such letter shall be a date not more than five days
prior to such Date of Delivery.
If any condition specified in this Section shall not have been
fulfilled when and as required to be fulfilled, this Agreement may be
terminated by the Underwriters by notice to the Company and the Selling
Shareholder at any time at or prior to Closing Time and such termination shall
be without liability of any party to any other party except as provided in
Section 4 hereof.
SECTION 6. Indemnification.
(a) The Company agrees to indemnify and hold harmless each
Underwriter and each person, if any, who controls any Underwriter within the
meaning of Section 15 of the 1933 Act as follows:
(i) against any and all loss, liability, claim,
damage and expense whatsoever, as incurred, arising out of any untrue
statement or alleged untrue statement of a material fact contained in
the Registration Statement (or any amendment thereto), including
information deemed to be part of the Registration Statement pursuant to
Rule 430A(b) of the 1933 Act Regulations, if applicable, or the
omission or alleged omission therefrom of a material fact required to
be stated therein or necessary to make the statements therein not
misleading or arising out of any untrue statement or alleged untrue
statement of a material fact contained in any preliminary prospectus or
the Prospectus (or any amendment or supplement thereto) or the omission
or alleged omission therefrom of a material fact necessary in order to
make the statements therein, in the light of the circumstances under
which they were made, not misleading, unless in each case such untrue
statement or omission or such alleged untrue statement or omission was
made in reliance upon and in conformity with written information
furnished to the Company by an Underwriter through the Representatives
expressly for use in the Registration Statement (or any amendment
thereto) or such preliminary prospectus or the Prospectus (or any
amendment or supplement thereto); provided, however, that with respect
to any untrue statement or omission or alleged untrue statement or
omission made in any preliminary prospectus or the Prospectus the
indemnity agreement contained in this
-22-
<PAGE> 24
subsection (a) shall not inure to the benefit of any Underwriter from
whom the person asserting any such loss, liability, claim, damage or
expense purchased the Securities concerned, to the extent that any such
loss, liability, claim, damage or expense of such Underwriter results
from the fact that there was not sent or given to such person, at or
prior to the written confirmation of the sale of such Securities to
such person, a copy of the Prospectus (exclusive of material
incorporated by reference) if the Company had previously furnished
copies thereof to such Underwriter;
(ii) against any and all loss, liability, claim,
damage and expense whatsoever, as incurred, to the extent of the
aggregate amount paid in settlement of any litigation, or any
investigation or proceeding by any governmental agency or body,
commenced or threatened, or of any claim whatsoever based upon any such
untrue statement or omission, or any such alleged untrue statement or
omission, if such settlement is effected with the written consent of
the Company; and
(iii) against any and all expense whatsoever, as
incurred (including the fees and expenses of counsel chosen by the
Representatives), reasonably incurred in investigating, preparing or
defending against any litigation, or any investigation or proceeding by
any governmental agency or body, commenced or threatened, or any claim
whatsoever based upon any such untrue statement or omission, or any
such alleged untrue statement or omission, to the extent that (x) the
Company is required to do so under subsection (e) of this Section below
and (y) any such expense is not paid under (i) or (ii) above.
Insofar as this indemnity may permit indemnification for
liabilities under the 1933 Act of any person who is a partner of an Underwriter
or who controls an Underwriter within the meaning of Section 15 of the 1933 Act
and who, at the date of this Agreement, is a director, officer or controlling
person of the Company, such indemnity is subject to the undertaking of the
Company in the Registration Statement.
(b) The Company and the Selling Shareholder each agree to
indemnify and hold harmless the other pursuant to the terms set forth in the
Registration Rights and Lock-Up Agreement dated November 22, 1993 ("Lock-up
Agreement") by and among the Company and the Selling Shareholder.
(c) Each Underwriter severally agrees to indemnify and
hold harmless the Company, its directors, each of its officers who signed the
Registration Statement, and each person, if any, who controls the Company
within the meaning of Section 15 of the 1933 Act and the Selling Shareholder
against any and all loss, liability, claim, damage and expense described in the
indemnity contained in subsection (a) of this Section, but only with respect to
untrue statements or omissions, or alleged untrue statements or omissions, made
in the Registration Statement (or any amendment thereto) or any preliminary
prospectus or the Prospectus (or any amendment or supplement thereto) in
reliance upon and in conformity
-23-
<PAGE> 25
with written information furnished to the Company by such Underwriter through
the Representatives expressly for use in the Registration Statement (or any
amendment thereto) or such preliminary prospectus or the Prospectus (or any
amendment or supplement thereto).
(d) The Selling Shareholder agrees to indemnify and hold
harmless each Underwriter and each person, if any, who controls any Underwriter
within the meaning of Section 15 of the 1933 Act against any and all loss,
liability, claim, damage, and expense described in the indemnity contained in
subsection (a) of the Section, but only with respect to untrue statements or
omissions, or alleged untrue statements or omissions, made in the Registration
Statement (or any amendment thereto) or any preliminary prospectus or the
prospectus (or any amendment or supplement thereto) in reliance upon and in
conformity with written information furnished to the Company by the Selling
Shareholder expressly for use in the Registration Statement (or any amendment
thereto) or such preliminary prospectus or the Prospectus.
(e) Each indemnified party shall give notice as promptly
as reasonably practicable to each indemnifying party of any action commenced
against it in respect of which indemnity may be sought hereunder but failure to
so notify any indemnifying party shall not relieve it from any liability which
it may have otherwise than on account of this indemnity agreement. An
indemnifying party may participate at its own expense in the defense of such
action. If it so elects within a reasonable time after receipt of such notice,
an indemnifying party, jointly with any other indemnifying parties receiving
such notice, may assume the defense of such action with counsel chosen by it
and approved by the indemnified parties defendant in such action, except to the
extent such indemnified parties retain separate counsel (the "Separate
Counsel") with respect to legal defenses available to them that are different
from or in addition to those available to such indemnifying party and such
defenses are in conflict with the interests of the indemnifying parties. If an
indemnifying party assumes the defense of such action, the indemnifying parties
shall not be liable for any fees and expenses of counsel for the indemnified
parties incurred thereafter in connection with such action. In no event shall
the indemnifying parties be liable for the reasonable fees and expenses of more
than the Separate Counsel (in addition to any local counsel) separate from
their own counsel for all indemnified parties in connection with any one action
or separate but similar or related actions in the same jurisdiction arising out
of the same general allegations or circumstances.
(f) This Agreement supersedes the provisions of the
Lock-Up Agreement providing for indemnification of the Underwriters by the
Company and the Selling Shareholder in connection with the offering and sale of
the Securities.
SECTION 7. Contribution. In order to provide for just
and equitable contribution in circumstances in which the indemnity agreement
provided for in Section 6 hereof is for any reason held to be unenforceable by
the indemnified parties although applicable in accordance with its terms, the
Company and the Selling Shareholder and the
-24-
<PAGE> 26
Underwriters shall contribute to the aggregate losses, liabilities, claims,
damages and expenses of the nature contemplated by said indemnity agreement
incurred by the Company and the Selling Shareholder and one or more of the
Underwriters in such proportions that the Underwriters are responsible for that
portion represented by the percentage that the underwriting discount appearing
on the cover page of the Prospectus bears to the initial public offering price
appearing thereon and the Company and the Selling Shareholder are responsible
for the balance; provided, however, that no person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the 1933 Act) shall
be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. For purposes of this Section, each person, if
any, who controls an Underwriter or the Selling Shareholder within the meaning
of Section 15 of the 1933 Act shall have the same rights to contribution as
such Underwriter or Selling Shareholder, as the case may be, and each director
of the Company, each officer of the Company who signed the Registration
Statement, and each person, if any, who controls the Company within the meaning
of Section 15 of the 1933 Act shall have the same rights to contribution as the
Company.
SECTION 8. Representations, Warranties and Agreements to
Survive Delivery. All representations, warranties and agreements contained in
this Agreement and the Pricing Agreement, or contained in certificates of
officers of the Company or the Selling Shareholder submitted pursuant hereto,
shall remain operative and in full force and effect, regardless of any
investigation made by or on behalf of any Underwriter or controlling person, or
by or on behalf of the Company or the Selling Shareholder, and shall survive
delivery of the Securities to the Underwriters.
SECTION 9. Termination of Agreement.
(a) The Representatives may terminate this Agreement, by
notice to the Company and the Selling Shareholder, at any time at or prior to
Closing Time (i) if there has been, since the date of this Agreement or since
the respective dates as of which information is given in the Prospectus any
material adverse change in the condition, financial or otherwise, or the
earnings, business affairs or business prospects of the Company and its
subsidiaries considered as one enterprise, whether or not arising in the
ordinary course of business, or (ii) if there has occurred any material adverse
change in the financial markets of the United States or elsewhere or any
outbreak or escalation of hostilities or other calamity or crisis the effect of
which is such as to make it, in the judgment of the Representatives,
impracticable to market the Securities or enforce contracts for the sale of the
Securities, or (iii) if trading in the Common Stock has been suspended by the
Commission, or if trading generally on either the New York Stock Exchange or
the American Stock Exchange has been suspended, or minimum or maximum prices
for trading have been fixed, or maximum ranges for prices for securities have
been required, by either of said exchanges or by order of the Commission or any
other governmental authority, or if a banking moratorium has been declared by
either federal or New York authorities.
-25-
<PAGE> 27
(b) If this Agreement is terminated pursuant to this
Section, such termination shall be without liability of any party except as
provided in Section 4 hereof and except that the provisions of Sections 6 and 7
shall remain in effect. As used in Section 9(a), the term "Prospectus" means
the Prospectus in the form first used to confirm sales of the Securities.
SECTION 10. Default by an Underwriter. If any one of the
Underwriters shall fail to purchase and pay for any of the Initial Securities
agreed to be purchased by such Underwriter under this Agreement and the
Pricing Agreement and such failure to purchase shall constitute a default in
the performance of its obligations hereunder and thereunder, the remaining
Underwriters shall have the right, within 24 hours thereafter, to make
arrangements for one or more of the non-defaulting Underwriters or any other
underwriters to purchase all, but not less than all, of Initial Securities not
so purchased in such amounts as may be agreed upon and upon the terms herein
set forth; if, however, the Underwriters shall not have completed such
arrangements within said 24-hour period, then:
(1) if the number of Initial Securities not so purchased
does not exceed 10% of the Initial Securities, the non-defaulting
Underwriters shall be obligated to purchase the full amount thereof in
the proportions that their respective underwriting obligations
hereunder bear to the underwriting obligations of all non-defaulting
Underwriters, or
(2) if the number of Initial Securities not so purchased
exceeds 10% of the Initial Securities, the Selling Shareholder will be
entitled to an additional period of 24 hours within which to find one
or more substitute underwriters reasonably satisfactory to the
Representatives to purchase such Securities on the terms set froth in
this Agreement. A substitute underwriter will become an Underwriter
for all purposes of this Agreement.
(3) if the number of Initial Securities not so purchased
exceeds 10% of the Initial Securities and the Selling Shareholder does
not find one or more substitute underwriters pursuant to subsection (2)
of this Section, this Agreement shall terminate without liability on
the part of any non-defaulting Underwriter.
No action taken pursuant to this Section shall relieve any defaulting
Underwriter from any liability it may have hereunder in respect of its default.
In the event of any such default that does not result in a termination
of this Agreement, each of the Representatives and the Company shall have the
right to postpone Closing Time for such period, not exceeding seven days, as
they shall determine in order that the required changes in Registration
Statement and the Prospectus or in any other documents or arrangements may be
effected.
-26-
<PAGE> 28
SECTION 11. Notices. 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 directed to the Representatives c/o Merrill Lynch &
Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated at World Financial
Center, North Tower, 250 Vesey Street, New York, New York 10281, to the
attention of Lee R. Cole; notices to the Company shall be directed to it at
1200 Smith Street, Suite 2400, Houston, Texas 77002 to the attention of James
L. Persky; and notices to the Selling Shareholder shall be directed to Richard
C. Blum & Associates, Inc., 909 Montgomery Street, Suite 400, San Francisco,
California 94133 to the attention of N. Colin Lind.
SECTION 12. Parties. This Agreement and the Pricing Agreement
shall each inure to the benefit of and be binding upon the Underwriters, the
Company and the Selling Shareholder and their respective successors. Nothing
expressed or mentioned in this Agreement or the Pricing Agreement is intended
or shall be construed to give any person, firm or corporation, other than the
Underwriters, the Company and the Selling Shareholder and their respective
successors and the controlling persons and officers and directors referred to
in Sections 6 and 7 hereof and their heirs and legal representatives, any legal
or equitable right, remedy or claim under or in respect of this Agreement or
the Pricing Agreement or any provision herein or therein contained. This
Agreement and the Pricing Agreement and all conditions and provisions hereof
and thereof are intended to be for the sole and exclusive benefit of the
Underwriters, the Company and the Selling Shareholder and their respective
successors, and said controlling persons and officers and directors and their
heirs and legal representatives, and for the benefit of no other person, firm
or corporation. No purchaser of Securities from any Underwriter shall be deemed
to be a successor by reason merely of such purchase.
SECTION 13. Governing Law and Time. This Agreement and the
Pricing Agreement shall be governed by the laws of the State of New York
applicable to agreements made and to be performed in said state. Except where
otherwise provided, specified times of day refer to New York City time.
-27-
<PAGE> 29
If the foregoing is in accordance with your understanding of
our agreement, please sign and return to us a counterpart hereof, whereupon
this instrument along with all counterparts will become a binding agreement
among the Company, the Selling Shareholder and each of the Underwriters in
accordance with its terms.
<TABLE>
<S> <C>
Very truly yours,
SOUTHDOWN, INC.
By: /S/ EDGAR J. MARSTON III
-----------------------
Name: Edgar J. Marston III
Title: Executive Vice President
and General Counsel
CARPENTERS PENSION TRUST
FOR SOUTHERN CALIFORNIA
By: Richard C. Blum and
Associates, Inc.,
Investment Adviser
By: /S/ N. COLIN LIND
-----------------------
Name: N. Colin Lind
Title: Managing Director
RICHARD C. BLUM
& ASSOCIATES, INC.
By: /S/ N. COLIN LIND
-----------------------
Name: N. Colin Lind
Title: Managing Director
CONFIRMED AND ACCEPTED,
as of the date first above written:
MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith Incorporated
KIDDER, PEABODY & CO. INCORPORATED
LEHMAN BROTHERS INC.
By: Merrill Lynch, Pierce, Fenner & Smith Incorporated
By: /S/ GEORGE C. MORRIS III
--------------------------
Name: George C. Morris III
Title: Director
</TABLE>
-28-
<PAGE> 30
SCHEDULE A
<TABLE>
<CAPTION>
Number of
Name of Initial Securities
Underwriter to be Purchased
- ----------- ---------------
<S> <C>
Merrill Lynch, Pierce, Fenner & Smith
Incorporated . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 340,000
Kidder, Peabody & Co. Incorporated . . . . . . . . . . . . . . . . . . . . . . . . . 340,000
Lehman Brothers Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 340,000
Bear, Stearns & Co. Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 125,000
CS First Boston Corporation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 125,000
Dillon, Read & Co. Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 125,000
Donaldson, Lufkin & Jenrette Securities Corporation . . . . . . . . . . . . . . . . . 125,000
Williams Mackay Jordan & Co., Inc. . . . . . . . . . . . . . . . . . . . . . . . . . 30,000
---------
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,550,000
---------
</TABLE>
-29-
<PAGE> 31
SCHEDULE B
Kosmos Cement Company, a Kentucky general partnership
-30-
<PAGE> 32
SCHEDULE C
G. Walter Loewenbaum II
Clarence C. Comer
Fentress Bracewell
W.J. Conway
Killian L. Huger Jr.
Edgar J. Marston III
Michael A. Nicolais
Frank J. Ryan
Robert J. Slater
Ronald N. Tutor
V. H. Van Horn III
Steven B. Wolitzer
J. Bruce Tompkins
James L. Persky
Dennis M. Thies
-31-
<PAGE> 33
EXHIBIT A
SOUTHDOWN, INC.
(a Louisiana corporation)
1,550,000 Shares
Common Stock
(Par Value $1.25 Per Share)
PRICING AGREEMENT
January 20, 1994
MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
KIDDER, PEABODY & CO. INCORPORATED
LEHMAN BROTHERS INC.
as Representatives of the
several Underwriters
c/o MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith Incorporated
Merrill Lynch World Headquarters
World Financial Center
North Tower
250 Vesey Street
New York, New York 10281
Dear Sirs:
Reference is made to the Purchase Agreement, dated January 20, 1994
(the "Purchase Agreement"), relating to the purchase by the several
Underwriters named in Schedule A thereto, for whom Merrill Lynch & Co., Merrill
Lynch, Pierce, Fenner & Smith Incorporated, Kidder, Peabody & Co. Incorporated
and Lehman Brothers Inc. are acting as representatives (collectively, the
"Underwriters") of the above-referenced shares of Common Stock of Southdown,
Inc., a Louisiana corporation, from Carpenters Pension Trust for Southern
California, a California pension fund, and Richard C. Blum & Associates, Inc.,
a California corporation (collectively, the "Selling Shareholder"), and the
grant by the Selling Shareholder to the Underwriters of options to purchase up
to an additional 232,500 shares of Common Stock to cover over-allotments.
Capitalized terms used herein and not otherwise defined shall have the
respective meanings assigned thereto in the Purchase Agreement.
Pursuant to Section 2 of the Purchase Agreement, the Selling
Shareholder agrees with each Underwriter as follows:
<PAGE> 34
1. The initial public offering price per share of the
Securities, determined as provided in said Section 2, shall be $27.125.
2. The purchase price per share for the Securities to be paid
by the several Underwriters shall be $25.635, being an amount equal to the
initial public offering price set forth above less $1.49 per share
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Selling Shareholder a counterpart
hereof, whereupon this instrument along with all counterparts will become a
binding agreement between the Selling Shareholder and each of the Underwriters
in accordance with its terms.
<TABLE>
<S> <C>
Very truly yours,
CARPENTERS PENSION TRUST
FOR SOUTHERN CALIFORNIA
By: Richard C. Blum and
Associates, Inc.
Investment Adviser
By: /S/ N. COLIN LIND
--------------------------
Name: N. Colin Lind
Title: Managing Director
RICHARD C. BLUM & ASSOCIATES, INC.
By: /S/ N. COLIN LIND
--------------------------
Name: N. Colin Lind
Title: Managing Director
CONFIRMED AND ACCEPTED,
as of the date first above written:
MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
KIDDER, PEABODY & CO. INCORPORATED
LEHMAN BROTHERS INC.
By: Merrill Lynch, Pierce, Fenner & Smith
Incorporated
By: /S/ GEORGE C. MORRIS III
-----------------------------------
Name: George C. Morris
Title: Director
</TABLE>
