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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) May 11, 1995
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CYPRUS AMAX MINERALS COMPANY
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(Exact name of registrant as specified in its charter)
Delaware 1-10040 36-2684040
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(State or other juris- (Commission I.R.S. Employer
diction of incorporation File Number) (Identification No.)
9100 East Mineral Circle, P.O. Box 3299, Englewood, CO 80155
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(Address of principal executive offices) (Zip Code)
(303) 643-5000
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(Registrant's telephone number, including area code)
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Item 7. Financial Statements and Exhibits
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(c) Exhibits
1. Underwriting Agreement, dated May 10, 1995, between the Company and
Smith Barney Inc., Bear, Sterns & Co. Inc., PaineWebber Incorporated,
Chemical Securities Inc. and Citicorp Securities, Inc.
12. Computation of Ratio of Earnings to Fixed Charges and Ratio of Earnings to
Combined Fixed Charges and Preferred Stock Dividend Requirements.
1
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Date: May 11, 1995 CYPRUS AMAX MINERALS COMPANY
By: /s/ John Taraba
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Name: John Taraba
Vice President
and Controller
2
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Exhibits
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1. Underwriting Agreement, dated May 10, 1995, between the Company and
Smith Barney Inc., Bear, Sterns & Co. Inc., PaineWebber Incorporated,
Chemical Securities Inc. and Citicorp Securities, Inc.
12. Computation of Ratio of Earnings to Fixed Charges and Ratio of
Earnings to Combined Fixed Charges and Preferred Stock Dividend
Requirements.
3
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EXHIBIT 1
UNDERWRITING AGREEMENT
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May 10, 1995
Smith Barney Inc.
Bear, Stearns & Co. Inc.
PaineWebber Incorporated
Chemical Securities Inc.
Citicorp Securities, Inc.
c/o Smith Barney Inc.
388 Greenwich Street
New York, New York 10013
Gentlemen:
From time to time Cyprus Amax Minerals Company, a Delaware corporation
(the "Company") proposes to enter into one or more Pricing Agreements (each a
"Pricing Agreement") in the form of Annex I hereto, with such additions and
deletions as the parties thereto may determine, and, subject to the terms and
conditions stated herein and therein, to issue and sell to the firms named in
Schedule I to the applicable Pricing Agreement (such firms constituting the
"Underwriters" with respect to such Pricing Agreement and the securities
specified therein) the principal amount of debt securities of the Company (the
"Securities") specified in Schedule II to such Pricing Agreement with respect to
such Pricing Agreement, the "Firm Securities"). If specified in such Pricing
Agreement, the Company may grant to the Underwriters the right to purchase at
their election an additional aggregate principal amount of Securities specified
in such Pricing Agreement as provided in Section 3 hereof (the "Optional
Securities"). The Firm Securities and the Optional Securities, if any, which
the Underwriters elect to purchase pursuant to Section 3 hereof are herein
collectively called the "Designated Securities."
The terms and rights of any particular issuance of Designated
Securities shall be as specified in the Pricing Agreement relating thereto and
in or pursuant to the indenture (the "Indenture") identified in such Pricing
Agreement.
1. Particular sales of Designated Securities may be made from time
to time to the Underwriters of such Securities, for whom the firms designated as
representatives of the Underwriters of such Securities in the Pricing Agreement
relating thereto will act as representatives (the "Representatives"). The term
"Representatives" also refers to a single firm acting as sole representative of
the Underwriters and to Underwriters who act without any firm being designated
as their representative.
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May 10, 1995
Page 2
This Underwriting Agreement shall not be construed as an obligation of the
Company to sell any of the Securities or as an obligation of any of the
Underwriters to purchase any of the Securities. The obligation of the Company
to issue and sell any of the Securities and the obligation of any of the
Underwriters to purchase any of the Securities shall be evidenced by the Pricing
Agreement with respect to the Designated Securities specified therein. Each
Pricing Agreement shall specify the aggregate principal amount of Firm
Securities, the maximum principal amount of Optional Securities, if any, the
initial public offering price of such Firm and Optional Securities or the manner
of determining such price, the purchase price to the Underwriters of such
Designated Securities, the names of the Underwriters of such Designated
Securities, the names of the Representatives of such Underwriters, the number of
such Designated Securities to be purchased by each Underwriter and the
commission, if any, payable to the Underwriters with respect thereto and shall
set forth the date, time and manner of delivery of such Firm and Optional
Securities, if any, and payment therefor. The Pricing Agreement shall also
specify (to the extent not set forth in the Indenture and the registration
statement and prospectus with respect thereto) the terms of such Designated
Securities. A Pricing Agreement shall be in the form of an executed writing
(which may be in counterparts), and may be evidenced by an exchange of
telegraphic communications or any other rapid transmission device designated to
produce a written record of communications transmitted. The obligations of the
Underwriters under this Agreement and each Pricing Agreement shall be several
and not joint.
2. Representations and Warranties of the Company. The Company
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represents and warrants to, and agrees with, each Underwriter that:
(a) A registration statement (No. 33-54097), including a
prospectus, relating to the Securities has been filed with the Securities and
Exchange Commission ("Commission") and has become effective. Such registration
statement, as amended at the time of this Agreement, is hereinafter referred to
as the "Registration Statement," and the prospectus included in such
Registration Statement, as supplemented to reflect the terms of the Securities
and the terms of the offering hereof, as first filed with the Commission
pursuant to and in accordance with Rule 424(b) ("Rule 424(b)") under the
Securities Act of 1933 ("Act"), including all material incorporated by reference
therein, is hereinafter referred to as the "Prospectus."
Each form of prospectus, or prospectus and prospectus supplement, if
any, heretofore made available for use in offering
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May 10, 1995
Page 3
the Securities is referred to herein as a "preliminary prospectus." Any
reference herein to the Registration Statement, the Prospectus, any amendment or
supplement thereto or any preliminary prospectus shall be deemed to refer to and
include the documents incorporated by reference therein, and any reference
herein to the terms "amend," "amendment" or "supplement," or similar terms, with
respect to the Registration Statement or Prospectus shall be deemed to refer to
and include the filing after the execution hereof of any document with the
Commission deemed to be incorporated by reference therein.
(b) On the effective date of the registration statement relating
to the Securities, such registration statement conformed in all material
respects to the requirements of the Act, the Trust Indenture Act of 1939 ("Trust
Indenture Act") and the rules and regulations of the Commission ("Rules and
Regulations") and did not include any untrue statement of a material fact or
omit to state any material fact required to be stated therein or necessary to
make the statements therein not misleading, and on the date of the Pricing
Agreement or date of filing of the Prospectus as referred to above, the
Registration Statement and the Prospectus conformed or will conform in all
material respects to the requirements of the Act, the Trust Indenture Act and
the Rules and Regulations, and neither of such documents included or will
include any untrue statement of a material fact or omitted or will omit to state
any material fact required to be stated therein or necessary to make the
statements therein not misleading, except that the foregoing does not apply to
statements in or omissions from any of such documents based upon written
information furnished to the Company by any Underwriter through the
Representative or Representatives, if any, of the Underwriters as identified
above specifically for use therein.
(c) The documents incorporated by reference in the Registration
Statement, the Prospectus, any amendment or supplement thereto, when they became
or become effective under the Act or were or are filed with the Commission under
the Securities Exchange Act of 1934, as amended ("Exchange Act"), as the case
may be, conformed or will conform in all material respects with the requirements
of the Act or the Exchange Act, as applicable, and the rules and regulations of
the Commission thereunder.
(d) The consolidated financial statements of the Company,
together with the related notes and schedules, set forth or incorporated by
reference in the Registration Statement and Prospectus for the periods therein
specified have been prepared in conformity with generally accepted accounting
principles
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May 10, 1995
Page 4
consistently applied throughout the periods involved (except as otherwise stated
therein).
3. Purchase, Sale and Delivery of Securities. Upon the execution of
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the Pricing Agreement applicable to any Designated Securities and authorization
by the Representatives of the release of the Firm Securities, the several
Underwriters propose to offer the Firm Securities for sale upon the terms and
conditions set forth in the Prospectus as amended or supplemented.
The Company may specify in the Pricing Agreement applicable to any
Designated Securities that the Company thereby grants to the Underwriters the
right (an "Over-allotment Option") to purchase at their election up to the
principal amount of Optional Securities set forth in such Pricing Agreement, at
the terms set forth in the paragraph above, for the sole purpose of covering
over-allotments in the sale of the Firm Securities. Any such election to
purchase Optional Securities may be exercised by written notice from the
Representatives to the Company, given within a period specified in the Pricing
Agreement, setting forth the aggregate principal amount of Optional Securities
to be purchased and the date on which such Optional Securities are to be
delivered, as determined by the Representatives but in no event earlier than the
Closing Date (as defined below) or, unless the Representatives and the Company
otherwise agree in writing, earlier than or later than the respective number of
business days after the date of such notice set forth in such Pricing Agreement.
The principal amount of Optional Securities to be added to the number
of Firm Securities to be purchased by each Underwriter as set forth in Schedule
I to the Pricing Agreement applicable to such Designated Securities shall be, in
each case, the principal amount of Optional Securities which the Company has
been advised by the Representatives have been attributed to such Underwriter,
provided that, if the Company has not been so advised, the principal amount of
Optional Securities to be so added shall be, in each case, that proportion of
Optional Securities which the principal amount of Firm Securities to be
purchased by such Underwriter under such Pricing Agreement bears to the
aggregate principal amount of Firm Securities. The total principal amount of
Designated Securities to be purchased by all the Underwriters pursuant to such
Pricing Agreement shall be the aggregate principal amount of Firm Securities set
forth in Schedule I to such Pricing Agreement plus the aggregate principal
amount of the Optional Securities which the Underwriters elect to purchase.
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May 10, 1995
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The Designated Securities to be purchased by the Underwriters will be
delivered by the Company to you for the accounts of the several Underwriters at
the office specified by the Representatives against payment of the purchase
price therefor by wire transfer or certified or official bank check or checks in
New York Clearing House (next day) funds payable to the order of the Company at
the office, on the date and at the times specified in such Schedule I, or at
such other time not later than eight full business days thereafter as you and
the Company determine, such time being herein referred to as the "Closing Date."
Such Designated Securities will be prepared in definitive form and in such
authorized denominations and registered in such names as you may request upon at
least two business days' prior notice to the Company and will be made available
for checking and packaging at the office at which they are to be delivered at
the Closing Date (or such other office as may be specified for that purpose by
the Representatives) at least one business day prior to the Closing Date.
It is understood that the Underwriters propose to offer the Designated
Securities for sale as set forth in the Prospectus. It is also understood that
you, acting individually and not in a representative capacity, may (but shall
not be obligated to) make payment to the Company on behalf of any other
Underwriter for Designated Securities to be purchased by such Underwriter. Any
such payment by you shall not relieve any such Underwriter of any of its
obligations hereunder.
The Company will pay to you, at the Closing Date, for the account of
each Underwriter any commission or other compensation that is specified in
Schedule I to the Pricing Agreement. Such payment will be made by wire transfer
or certified or official bank check or checks in New York Clearing House (next
day) funds.
4. Certain Agreements of the Company. The Company agrees with the
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several Underwriters of any Designated Securities that it will furnish to
Simpson Thacher & Bartlett, counsel for the Underwriters, one signed copy of the
registration statement relating to the Securities, including all exhibits, in
the form it became effective and of all amendments thereto and that, in
connection with each offering of Securities:
(a) The Company will file the Prospectus with the Commission
pursuant to and in accordance with Rule 424(b)(2) (or, if applicable and if
consented to by the Representatives, subparagraph (5)) not later than the second
business day following the execution and delivery of this Agreement.
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May 10, 1995
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(b) The Company will advise the Representatives promptly of any
proposal to amend or supplement the Registration Statement or the Prospectus and
will afford the Representatives a reasonable opportunity to comment on any such
proposed amendment or supplement; and the Company will also advise the
Representatives promptly of the filing of any such amendment or supplement and
of the institution by the Commission of any stop order proceedings in respect of
the Registration Statement or of any part thereof and will use its best efforts
to prevent the issuance of any such stop order and to obtain as soon as possible
its lifting, if issued.
(c) If, at any time when a prospectus relating to the Securities
is required to be delivered under the Act, any event occurs as a result of which
the Prospectus as then amended or supplemented would include an untrue statement
of a material fact or omit to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, or if it is necessary at any time to amend the Prospectus
to comply with the Act, the Company promptly will prepare and file with the
Commission an amendment or supplement which will correct such statement or
omission or an amendment which will effect such compliance. Neither the
Representatives' consent to, nor the Underwriters' delivery of, any such
amendment or supplement shall constitute a waiver of any of the conditions set
forth in Section 5.
(d) As soon as practicable, but not later than 16 months, after
the date of this Agreement, the Company will make generally available to its
securityholders an earning statement covering a period of at least 12 months
beginning after the later of (i) the effective date of this registration
statement relating to the Securities, (ii) the effective date of the most recent
post-effective amendment to the Registration Statement to become effective prior
to the date of this Agreement and (iii) the date of the Company's most recent
Annual Report on Form 10-K filed with the Commission prior to the date of this
Agreement, which will satisfy the provisions of Section 11(a) of the Act.
(e) The Company will furnish to the Representatives copies of the
Registration Statement, including all exhibits, any related preliminary
prospectus, any related preliminary prospectus supplement, the Prospectus and
all amendments and supplements to such documents, in each case as soon as
available and in such quantities as are reasonably requested.
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May 10, 1995
Page 7
(f) The Company will arrange for the qualification of the
Designated Securities for sale and the determination of their eligibility for
investment under the laws of such jurisdictions as the Representatives designate
and will continue such qualifications in effect so long as required for the
distribution.
(g) During the period of five years after the date of this
Agreement, the Company will furnish to the Representatives and, upon request, to
each of the other Underwriters, if any, as soon as practicable after the end of
each fiscal year, a copy of its annual report to stockholders for such year; and
the Company will furnish to the Representatives (i) as soon as available, a copy
of each report or definitive proxy statement of the Company filed with the
Commission under the Securities Exchange Act of 1934 (the "Exchange Act") or
mailed to stockholders, and (ii) from time to time, such other information
concerning the Company as the Representatives may reasonably request.
(h) The Company will pay all expenses incident to the performance
of its obligations under this Agreement and will reimburse the Underwriters for
any expenses (including fees and disbursements of counsel) incurred by them in
connection with qualification of the Securities for sale and determination of
their eligibility for investment under the laws of such jurisdictions as the
Representatives may designate and the printing of memoranda relating thereto for
any fees charged by investment rating agencies for the rating of the Securities,
for the filing fee of the National Association of Securities Dealers, Inc.
relating to the Securities and for expenses incurred in distributing the
Prospectus, and preliminary prospectuses and any preliminary prospectus
supplements to Underwriters.
(i) For a period beginning at the time of execution of the date
of the Pricing Agreement for such Designated Securities and ending 30 days after
the Closing Date, without the prior consent of the Representatives, the Company
will not offer, sell, contract to sell or otherwise dispose of any United States
dollar-denominated debt securities issued or guaranteed by the Company and
having a maturity of more than one year from the date of issue.
5. Conditions to the Obligations of the Underwriters. The
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obligations of the several Underwriters to purchase and pay for the Designated
Securities will be subject to the accuracy of the representations and warranties
on the part of the Company herein, to the accuracy of the statements of Company
officers made pursuant to the provisions hereof, to the performance by the
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May 10, 1995
Page 8
Company of its obligations hereunder and to the following additional conditions
precedent:
(a) On or prior to the date of the Pricing Agreement, or as
promptly thereafter as practicable, the Representatives shall have received a
letter, dated the date of delivery thereof, of Price Waterhouse, LLP, confirming
that they are independent public accountants with respect to the Company under
Rule 101 of the AICPA's Code of Professional Conduct, and its rulings and
interpretations and stating in effect that:
(i) in their opinion, the financial statements and schedules
examined by them and included in the prospectus contained in the
registration statement relating to the Securities, as amended at the date
of such letter, comply in form in all material respects with the applicable
accounting requirements of the Act and the Exchange Act, as applicable, and
the related published Rules and Regulations;
(ii) they have performed a review of unaudited interim
financial information included in such prospectus in accordance with
standards established by the America Institute of Certified Public
Accountants in Statement on Auditing Standards No. 71, Interim Financial
Information, as indicated in their report or reports included in the
Company's Quarterly Reports on Form 10-Q;
(iii) on the basis of the review referred to in (ii) above, a
reading of the latest available interim financial statements of the
Company, inquiries of officials of the Company who have responsibility for
financial and accounting matters and other specified procedures, nothing
came to their attention that caused them to believe that (A) the unaudited
financial statements, if any, included in such prospectus do not comply in
form in all material respects with the applicable accounting requirements
of the Act or the Exchange Act, as applicable, and the related published
Rules and Regulations or are not in conformity with generally accepted
accounting principles applied on a basis substantially consistent with that
of the audited financial statements included in such prospectus or (B) the
unaudited pro forma condensed consolidated financial statements included or
incorporated by reference in such prospectus do not comply as to form in
all material respects with the applicable accounting requirements of the
Act and the related published Rules and Regulations or the pro forma
adjustments have not been properly applied to the historical amounts in the
compilation of those statements; and
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May 10, 1995
Page 9
(iv) they have compared specified dollar amounts (or
percentages derived from such dollar amounts) and other financial
information contained in such prospectus (in each case to the extent that
such dollar amounts, percentages and other financial information are
derived from the general accounting records of the Company and its
subsidiaries subject to the internal controls of the Company's accounting
system or are derived directly from such records by analysis or
computation) with the results obtained from inquiries, a reading of such
general accounting records and other procedures specified in such letter
and have found such dollar amounts, percentage and other financial
information to be in agreement with such results, except as otherwise
specified in such letter.
All financial statements and schedules included in material incorporated by
reference into such prospectus shall be deemed included in such prospectus for
purposes of this subsection.
(b) The Prospectus shall have been filed with the Commission in
accordance with the Rules and Regulations and Section 4(a) of this Agreement.
No stop order suspending the effectiveness of the Registration Statement or of
any part thereof shall have been issued and no proceedings for that purpose
shall have been instituted or, to the knowledge of the Company or any
Underwriter, shall be contemplated by the Commission.
(c) Subsequent to the execution of this Agreement, there shall
not have occurred (i) any change, or any development involving a prospective
change, in or affecting particularly the business or properties of the Company
or its subsidiaries which, in the judgment of a majority in interest of the
Underwriters, including any Representatives, materially impairs the investment
quality of the Designated Securities or the Securities; (ii) any downgrading in
the rating of any debt securities of the Company by any "nationally recognized
statistical rating organization" (as defined for purposes of Rule 436(g) under
the Act), or any public announcement that any such organization has under
surveillance or review of its rating of any debt securities of the Company
(other than an announcement with positive implications of a possible upgrading,
and no implication of a possible downgrading, of such rating); (iii) any
suspension or limitation of trading in securities generally on the New York
Stock Exchange, or any setting of minimum prices for trading on such exchange,
or any suspension of trading of any securities of the Company on any exchange or
in the over-the-counter market (excluding any coordinated trading halt triggered
solely as a result of a specified decrease in a market index);
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May 10, 1995
Page 10
(iv) any banking moratorium declared by Federal or New York
authorities; or (v) any outbreak or escalation of major hostilities in which the
United States is directly involved, any declaration of war by Congress or any
other substantial national or international calamity or emergency if, in the
judgment of a majority in interest of the Underwriters, including any
Representatives, the effect of any such outbreak, escalation, declaration,
calamity or emergency makes it impractical or inadvisable to proceed with
completion of the sale of and payment for the Designated Securities.
(d) The Representatives shall have received opinions, dated the
Closing Date, of Davis, Graham & Stubbs, counsel for the Company (as to
paragraphs (i), (iv), (v), (vi)(A) and (B), (viii) and (x)) and Kathleen J.
Gormley, Esq., General Attorney of the Company (as to paragraphs (i), (ii),
(iii), (v), (vi)(A), (B) and (C), (vii) and (ix)), to the effect that:
(i) The Company has been duly incorporated and is an existing
corporation in good standing under the laws of the State of Delaware and
has full corporate power and authority to conduct its business as described
in the Registration Statement and Prospectus;
(ii) The Company has been duly qualified to do business in
each jurisdiction in which it owns or leases real property or in which the
conduct of its business requires such qualification except where the
failure to be so qualified, considering all such cases in the aggregate,
does not involve a material risk to the business, properties, financial
position or results of operations of the Company and its subsidiaries;
(iii) To the knowledge of such counsel, all of the outstanding
shares of capital stock of each United States subsidiary of the Company
named in the Prospectus (except for directors' qualifying shares and except
as otherwise stated in the Registration Statement) are owned beneficially
by the Company subject to no security interest, other encumbrance or
adverse claim (with such exceptions as would not have a material adverse
effect on the financial position, stockholders' equity or results of
operations of the Company and its subsidiaries);
(iv) The Indenture and the Designated Securities have been
duly authorized, the Indenture has been duly qualified under the Trust
Indenture Act, executed and delivered, the Designated Securities purchased
by the Underwriters have been duly executed, authenticated, issued
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May 10, 1995
Page 11
and delivered, and the Indenture and such Designated Securities constitute,
will constitute, valid and legally binding obligations of the Company,
enforceable in accordance with their terms subject to bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium and similar
laws of general applicability relating to or affecting creditors' rights
and to general equity principles;
(v) The Registration Statement has become effective under the
Act; the Prospectus Supplement has been filed as required by Section 2(a)
hereof; and to the knowledge of such counsel no stop order suspending the
effectiveness of the Registration Statement has been issued and no
proceeding for the purpose has been instituted or threatened by the
Commission;
(vi) (A) Each part of the Registration Statement, when such
part became effective, and the Prospectus and any amendment or supplement
thereto, on the date of filing thereof with the Commission and at the
Closing Date, complied as to form in all material respects with the
requirements of the Act, the Trust Indenture Act and the Rules and
Regulations; and (B) (note: the remainder of this clause (vi) and of clause
(vii) may be expressed as a statement rather than an opinion and in a
separate letter or paragraph in the standard form of such counsel), such
counsel have no reason to believe that either any part of the Registration
Statement, when such part 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 and any amendment or supplement thereto, on the date
of filing thereof with the Commission or at the Closing Date, included an
untrue statement of a material fact or omitted to state a material fact
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading; and (C) the documents
incorporated by reference in the Registration Statement or Prospectus or
any amendment or supplement thereto, when they became effective under the
Act or were filed with the Commission under the Exchange Act, as the case
may be, complied as to form in all material respects with the requirements
of the Act or the Exchange Act, as applicable, and the rules and
regulations of the Commission thereunder; it being understood that such
counsel need express no opinion as to the financial statements or other
financial, statistical or reserve data included in any of the documents
mentioned in this clause;
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May 10, 1995
Page 12
(vii) The description in the Registration Statement and
Prospectus of statutes, legal and governmental proceedings, contracts and
other documents are accurate and fairly present the information required to
be shown; and such counsel do not know of any statutes or legal or
governmental proceedings required to be described in the Prospectus that
are not described as required, or of any contracts or documents of a
character required to be described in the Registration Statement or
Prospectus (or required to be filed under the Exchange Act if upon such
filing they would be incorporated by reference therein) or to be filed as
exhibits to the Registration Statement that are not described and filed as
required;
(viii) This Agreement and the Pricing Agreement have been duly
authorized, executed and delivered by the Company;
(ix) The performance of this Agreement and the Pricing
Agreement and the consummation of the transactions herein contemplated will
not result in a breach or violation of any of the terms and provisions of,
or constitute a default under, any statute, any agreement or instrument
known to such counsel to which the Company is a party or by which it is
bound or to which any of the property of the Company is subject, the
Company's charter or bylaws, or any order, rule or regulation known to such
counsel of any court or governmental agency or body having jurisdiction
over the Company or any of its properties; and
(x) No consent, approval, authorization or order of, or
filing with, any court or governmental agency or body is required for the
consummation of the transactions contemplated by this Agreement and the
Pricing Agreement in connection with the issuance or sale of the Designated
Securities by the Company, except such as have been obtained under the Act
and the Trust Indenture Act and such as may be required under state
securities laws in connection with the purchase and distribution of the
Designated Securities by the Underwriters.
(e) The Representatives shall have received from Simpson Thacher
& Bartlett, counsel for the Underwriters, such opinion or opinions, dated
the Closing Date, with respect to the incorporation of the Company, the
validity of the Designated Securities, the Registration Statement, the
Prospectus and other related matters as they may require, and the Company
shall have furnished to such counsel such
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May 10, 1995
Page 13
documents as they request for the purpose of enabling them to pass upon
such matters.
(f) The Representatives shall have received a certificate, dated
the Closing Date, of the President or any Vice President and a principal
financial or accounting officer of the Company in which such officers, to
the best of their knowledge after reasonable investigation, shall state
that the representations and warranties of the Company in this Agreement
are true and correct, that the Company has complied with all agreements and
satisfied all conditions on its part to be performed or satisfied hereunder
at or prior to the Closing Date, that no stop order suspending the
effectiveness of the Registration Statement or of any part thereof has been
issued and no proceedings for that purpose have been instituted or are
contemplated by the Commission and that, subsequent to the date of the most
recent financial statements in the Prospectus, there has ben no material
adverse change in the financial position or results of operation of the
Company and its subsidiaries except as set forth in or contemplated by the
Prospectus or as described in such certificate.
(g) The Representatives shall have received a letter, dated the
Closing Date, of Price Waterhouse, LLP, which reconfirms the matters set
forth in their letter delivered pursuant to subsection (a) of this Section
and states in effect that:
(i) in their opinion, any financial statements or schedules
examined by them and included in the Prospectus and not covered by their
letter delivered pursuant to subsection (a) of this Section comply in form
in all material respects with the applicable accounting requirements of the
Act or the Exchange Act, as applicable, and the related published Rules and
Regulations;
(ii) they have performed a review of unaudited interim
financial information included in the Prospectus and not covered by their
letter delivered pursuant to subsection (a) of this Section in accordance
with standards established by the American Institute of Certified Public
Accountants in Statement on Auditing Standards No. 71, Interim Financial
Information, as indicated in their report or reports included in the
Company's Quarterly Reports on Form 10-Q;
(iii) on the basis of the review referred to in (ii) above, a
reading of the latest available interim
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May 10, 1995
Page 14
financial statements of the Company, inquiries of officials of the Company
who have responsibility for financial and accounting matters and other
specified procedures, nothing came to their attention that caused them to
believe that:
a. the unaudited financial statements, if any, included
in the Prospectus and not covered by their letter delivered pursuant
to subsection (a) of this Section do not comply in form in all
material respects with the applicable accounting requirements of the
Act or the Exchange Act, as applicable, and the related published
Rules and Regulations or are not in conformity with generally accepted
accounting principles applied on a basis substantially consistent with
that of the audited financial statements included in the Prospectus;
b. to the extent not covered by their letter delivered
pursuant to subsection (a) of this Section, the unaudited pro forma
condensed consolidated financial statements included or incorporated
by reference in the Prospectus do not comply as to form in all
material respects with the applicable accounting requirements of the
Act and the related published Rules and Regulations or the pro forma
adjustments have not been properly applied to the historical amounts
in the compilation of those statements;
c. the unaudited capsule information, if any, included in
the Prospectus does not agree with the amounts set forth in the
unaudited consolidated financial statements from which it was derived
or was not determined on a basis substantially consistent with that of
the audited financial statements included in the Prospectus;
d. at the date of the latest available balance sheet read
by such accountants, or at a subsequent specified date not more than
five days prior to the Closing Date, there was any change in the
capital stock or any increase in short term indebtedness or long term
debt of the Company and consolidated subsidiaries or, at the date of
the latest available balance sheet read by such accountants, there was
any decrease in consolidated net current assets or, as compared with
amounts shown on the latest balance sheet included in the Prospectus;
or
<PAGE>
May 10, 1995
Page 15
e. for the period from the date of the latest income
statement included in the Prospectus to the closing date of the latest
available income statement read by such accountants there were any
decreases, as compared with the corresponding period of the previous
year, in consolidated net sales, net operating income or in the ratio
of earnings to fixed charges;
except in all cases set forth in clauses (D) and (E) above for changes,
increases or decreases which the Prospectus discloses have occurred or may
occur or which are described in such letter; and
(iv) they have compared specified dollar amounts (or
percentages derived from such dollar amounts) and other financial
information included in the Prospectus and not covered by their letter
delivered pursuant to subsection (a) of this Section (in each case to the
extent that such dollar amounts, percentages and other financial
information are derived from the general accounting records of the Company
and its subsidiaries subject to the internal controls of the Company's
accounting system or are derived directly from such records by analysis or
computation) with the results obtained from inquiries, a reading of such
general accounting records and other procedures specified in such letter
and have found such dollar amounts, percentages and other financial
information to be in agreement with such results, except as otherwise
specified in such letter.
All financial statements and schedules included in material incorporated by
reference into the Prospectus shall be deemed included in the Prospectus for the
purposes of this subsection.
The Company will furnish the Representatives with such conformed
copies of such opinions, certificates, letters and documents as they reasonably
request.
6. Indemnification and Contribution.
--------------------------------
(a) The Company will indemnify and hold harmless each Underwriter
against any losses, claims, damages or liabilities, joint or several, to which
such Underwriter may become subject, under the 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 the Registration Statement, the Prospectus, or any
amendment or supplement thereto, or arise out of or are based upon the
<PAGE>
May 10, 1995
Page 16
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 each Underwriter for any legal or other expenses reasonably
incurred by such Underwriter in connection with investigating or defending any
such loss, claim, damage, liability or action as such expenses are incurred;
provided, however, that the Company will not be liable in any such case 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 in or omission or alleged
omission from any of such documents in reliance upon and in conformity with
written information furnished to the Company by such Underwriter through the
Representatives, if any, specifically for use therein.
(b) Each Underwriter will indemnify and hold harmless the Company
against any losses, claims, damages or liabilities to which the Company may
become subject, under the 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 the Registration Statement, the Prospectus, or any amendment or
supplement thereto, or arise out of or are based upon the omission or the
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, in each case to the
extent, but only to the extent, that such untrue statement or alleged untrue
statement or omission or alleged omission was made in reliance upon and in
conformity with written information furnished to the Company by such Underwriter
through the Representatives, if any, specifically for use therein, and will
reimburse any legal or other expenses reasonably incurred by the Company in
connection with investigating or defending any such loss, claim, damage,
liability or action as such expenses are incurred.
(c) Promptly after receipt by an indemnified party under this
Section of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against the indemnifying party
under subsection (a) or (b) above, notify the indemnifying party of the
commencement thereof; but the omission so to notify the indemnifying party will
not relieve it from any liability which it may have to any indemnified party
otherwise than under subsection (a) or (b) above unless the omission to so
notify materially prejudices such indemnifying party. In case any such action is
brought against any indemnified party and it notifies the indemnifying party of
the commencement thereof, the indemnifying party will be entitled to participate
therein and,
<PAGE>
May 10, 1995
Page 17
to the extent that it may wish, jointly with any other indemnifying party
similarly notified, to assume 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 the defense thereof, the indemnifying party will not be liable to such
indemnified party under this Section for any legal or other expenses
subsequently incurred by such indemnified party in connection with the defense
thereof other than reasonable costs of investigation.
(d) If the indemnification provided for in this Section is
unavailable or insufficient as a result of legal unavailability to hold harmless
an indemnified party under subsection (a) or (b) above, then each indemnifying
party shall contribute to the amount paid or payable by such indemnified party
as a result of the losses, claims, damages or liabilities referred to in
subsection (a) or (b) above (i) in such proportion as is appropriate to reflect
the relative benefits received by the Company on the one hand and the
Underwriters on the other from the offering of the Securities or (ii) if the
allocation provided by clause (i) above is not permitted by applicable law, in
such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault of the Company on
the one hand and the Underwriters on the other in connection with the statements
or omissions which resulted in such losses, claims, damages or liabilities as
well as any other relevant equitable considerations. The relative benefits
received by the Company on the one hand and the Underwriters on the other shall
be deemed to be in the same proportion as the total net proceeds from the
offering (before deducting expenses) received by the Company bear to the total
underwriting discounts and commissions received by the Underwriters. 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 or the Underwriters and the parties' relative intent, knowledge, access
to information and opportunity to correct or prevent such untrue statement or
omission. The amount paid by an indemnified party as a result of the losses,
claims, damages or liabilities referred to in the first sentence of this
subsection (d) shall be deemed to include any legal or other expenses reasonably
incurred by such indemnified party in connection with investigating or defending
any action or claim which is the subject of this subsection (d). Notwithstanding
the provisions of this subsection (d), no Underwriter shall be required to
contribute any amount in excess of the amount by
<PAGE>
May 10, 1995
Page 18
which the total price at which the Securities underwritten by it and distributed
to the public were offered to the public exceeds the amount of any damages which
such Underwriter has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Underwriters' obligations in this subsection
(d) to contribute are several in proportion to their respective underwriting
obligations and not joint.
(e) The obligations of the Company under this Section shall be in
addition to any liability which the Company may otherwise have and shall extend,
upon the same terms and conditions, to each person, if any, who controls any
Underwriter within the meaning of the Act; and the obligations of the
Underwriters under this Section shall be in addition to any liability which the
respective Underwriters may otherwise have and shall extend, upon the same terms
and conditions, to each director of the Company, to each officer of the Company
who has signed the Registration Statement and to each person, if any, who
controls the Company within the meaning of the Act.
7. Default of Underwriters. If any Underwriter or Underwriters
-----------------------
default in their obligations to purchase Designated Securities under this
Agreement and the Pricing Agreement and the aggregate principal amount of the
Designated Securities that such defaulting Underwriter or Underwriters agreed
but failed to purchase does not exceed 10% of the total principal amount of the
Designated Securities, the Representatives may make arrangements satisfactory to
the Company for the purchase of such Designated Securities by other persons,
including any of the Underwriters, but if no such arrangements are made by the
Closing Date, the non-defaulting Underwriters shall be obligated severally, in
proportion to their respective commitments under this Agreement, to purchase the
Designated Securities that such defaulting Underwriters agreed but failed to
purchase. If any Underwriter or Underwriters so default and the aggregate
principal amount of the Designated Securities with respect to which such default
or defaults occur exceeds 10% of the total principal amount of the Designated
Securities and arrangements satisfactory to the Representatives and the Company
for the purchase of such Designated Securities by other persons are not made
within 36 hours after such default, this Agreement will terminate without
liability on the part of any non-defaulting Underwriter or the Company, except
as provided in Section 8. As used in this Agreement, the term "Underwriter"
includes any person substituted for an Underwriter under this Section. Nothing
herein will
<PAGE>
May 10, 1995
Page 19
relieve a defaulting Underwriter from liability for its default. The respective
commitments of the several Underwriters for the purposes of this Section shall
be determined without regard to reduction in the respective Underwriters'
obligations to purchase the principal amounts of the Designated Securities set
forth opposite their names in Schedule I to the Pricing Agreement.
8. Survival of Certain Representations and Obligations. The
---------------------------------------------------
respective indemnities, agreements, representations, warranties and other
statements of the Company or its officers and of the several Underwriters set
forth in or made pursuant to this Agreement will remain in full force and
effect, regardless of any investigation, or statement as to the results thereof,
made by or on behalf of any Underwriter, the Company or any of their respective
representatives, officers or directors or any controlling person and will
survive delivery of and payment for the Securities. If this Agreement is
terminated pursuant to Section 7 or if for any reason the purchase of the
Designated Securities by the Underwriters under this Agreement is not
consummated, the Company shall remain responsible for the expenses to be paid or
reimbursed by it pursuant to Section 4 and the respective obligations of the
Company and the Underwriters pursuant to Section 6 shall remain in effect. If
the purchase of the Designated Securities by the Underwriters is not consummated
for any reason other than solely because of the termination of this Agreement
pursuant to Section 7 or the occurrence of any event specified in clause (iii),
(iv) or (v) of Section 5(c), the Company will reimburse the Underwriters for all
out-of-pocket expenses (including fees and disbursements of counsel) reasonably
incurred by them in connection with the offering of the Designated Securities.
9. Notices. All communications hereunder will be in writing and, if
-------
sent to the Underwriters, will be mailed, delivered or telegraphed and confirmed
to them at their addresses furnished to the Company in writing for the purpose
of communications hereunder or, if sent to the Company, will be mailed,
delivered or telegraphed and confirmed to it at its address set forth in the
Prospectus, Attention: Chief Financial Officer.
In all dealings with the Company under this Agreement, you shall act
on behalf of each of the several Underwriters, and any action under this
Agreement taken by you or by any one of you designated in Schedule I to the
Pricing Agreement will be binding upon all the Underwriters.
10. Successors. This Agreement will inure to the benefit of and be
----------
binding upon the Company and such Underwriters
<PAGE>
May 10, 1995
Page 20
as are identified in Schedule I to the Pricing Agreement and their respective
successors and the officers and directors and controlling persons referred to in
Section 6, and no other person will have any right or obligation hereunder.
11. APPLICABLE LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
--------------
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
If the foregoing correctly sets forth the understanding between the
Company and the several Underwriters, please so indicate in the space provided
below for that purpose, whereupon this letter shall constitute a binding
agreement between the Company and the several Underwriters purpose, whereupon
this letter shall constitute a binding agreement between the Company and the
several Underwriters. Alternatively, the execution of this Agreement by the
Company and its acceptance by or on behalf of the Underwriters may be evidenced
by an exchange of telegraphic or other written communications.
Very truly yours,
CYPRUS AMAX MINERALS COMPANY
By /s/ FRANCIS J. KANE
---------------------------------
<PAGE>
May 10, 1995
Page 21
ACCEPTED as of the date first above written on behalf of ourselves and as
Representative of the other Underwriters.
SMITH BARNEY INC.
By /s/ CHRISTOPHER LYNCH
---------------------------------
<PAGE>
ANNEX I
Pricing Agreement
-----------------
May 10, 1995
Smith Barney Inc.
As Representatives of the several
Underwriters named in Schedule I
hereto,
388 Greenwich Street
New York, New York 10013
Dear Sirs:
Cyprus Amax Minerals Company, a Delaware corporation (the "Company")
proposes, subject to the terms and conditions stated herein and in the
Underwriting Agreement, dated May 10, 1995 (the "Underwriting Agreement"),
between the Company on the one hand and you on the other hand, to issue and sell
to the Underwriters named in Schedule I hereto (the "Underwriters") the
Securities specified in Schedule II hereto (the "Designated Securities"). Each
of the provisions of the Underwriting Agreement is incorporated herein by
reference in its entirety, and shall be deemed to be a part of this Pricing
Agreement to the same extent as if such provisions had been set forth in full
herein; and each of the representations and warranties set forth therein shall
be deemed to have been made at and as of the date of this Pricing Agreement,
except that each representation and warranty which refers to the Prospectus in
Section 2 of the Underwriting Agreement shall be deemed to be a representation
or warranty as of the date of the Underwriting Agreement in relation to the
Prospectus (as therein defined), and also a representation and warranty as of
the date of this Pricing Agreement in relation to the Prospectus as amended or
supplemented relating to the Designated Securities which are the subject of this
Pricing Agreement. Each reference to the Representatives herein and in
<PAGE>
Smith Barney, Inc.
May 10, 1995
Page 2
the provisions of the Underwriting Agreement so incorporated by reference shall
be deemed to refer to you. Unless otherwise defined herein, terms defined in
the Underwriting Agreement are used herein as therein defined.
An amendment to the Registration Statement, or a supplement to the
Prospectus, as the case may be, relating to the Designated Securities, in the
form heretofore delivered to you is now proposed to be filed with the
Commission.
Subject to the terms and conditions set forth herein and in the
Underwriting Agreement incorporated herein by reference, the Company agrees to
issue and sell to each of the Underwriters, and each of the Underwriters agrees,
severally and not jointly, to purchase from the Company, at the time and place
and at the purchase price to the Underwriters set forth in Schedule II hereto,
the number of Firm Securities set forth opposite the name of such Underwriter in
Schedule I hereto.
If the foregoing is in accordance with your understanding, please sign
and return to us 7 counterparts hereof, and upon acceptance hereof by you, on
behalf of each of the Underwriters, this letter and such acceptance hereof,
including the provisions of the Underwriting Agreement incorporated herein by
reference, shall constitute a binding agreement between each of the Underwriters
and the Company. It is understood that your acceptance of this letter on behalf
of each of the Underwriters is or will be pursuant to the authority set forth in
a form of Agreement among Underwriters, the form of which shall be submitted to
the Company for examination, upon request, but without warranty on the part of
the Representatives as to the authority of the signers thereof.
Very truly yours,
CYPRUS AMAX MINERALS COMPANY
By: /s/ FRANCIS J. KANE
---------------------------------
Name: Francis J. Kane
Title: Vice President Invsestor
Relations and Treasurer
<PAGE>
Smith Barney, Inc.
May 10, 1995
Page 3
Accepted as of the date hereof:
SMITH BARNEY INC.
By: /s/ CHRISTOPHER LYNCH
---------------------------------
On behalf of each of the Underwriters
<PAGE>
Schedule I
to
Pricing Agreement
<TABLE>
<CAPTION>
Amount of Firm Securities
-------------------------
<S> <C>
Smith Barney Inc. $80,000,000
Bear, Stearns & Co. Inc. $80,000,000
PaineWebber Incorporated $80,000,000
Chemical Securities Inc. $ 5,000,000
Citicorp Securities, Inc. $ 5,000,000
Closing Date and Time: May 17, 1995
9:30 a.m. (Eastern Time)
</TABLE>
<PAGE>
Schedule II
to
Pricing Agreement
Title: 7 3/8% Notes due 2007
Principal Amount: $250,000,000
Price to Public: 99.372%
Underwriting Discount: 0.650%
Ranking: Senior
Terms: Unsecured: Unsubordinated
No sinking fund provision.
No redemption provision.
<PAGE>
EXHIBIT 12
CYPRUS AMAX MINERALS COMPANY
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES AND
RATIO OF EARNINGS TO COMBINED FIXED CHARGES AND PREFERRED
STOCK DIVIDEND REQUIREMENTS
(in millions)
<TABLE>
<CAPTION>
Three months Year ended December 31,
ended March 31, ----------------------------------------------------------------------------
1995 1994 1993 1992 1991 1990
--------------- ------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
Income (Loss) before Discontinued
Operations and Cumulative Effect
of Accounting Changes 97 166 100 (246) 43 111
Income Tax Provision (Benefit) 25 55 31 (83) 11 13
--------------- ------------ ------------ ------------ ------------ ------------
122 221 131 (329) 54 124
Fixed Charges
Interest 28 107 42 19 22 19
Interest Portion of Rental
Expense 4 18 12 12 10 8
--------------- ------------ ------------ ------------ ------------ ------------
Total Fixed Charges 32 125 54 31 32 27
Preferred Stock Dividend
Requirements 6 24 3 15 18 17
--------------- ------------ ------------ ------------ ------------ ------------
Combined Fixed Charges and
Preferred Stock Dividend
Requirements 38 149 57 46 50 44
=============== ============ ============ ============ ============ ============
Earnings (Loss) Before Income Taxes
and Fixed Charges 151 343 178 (300) 81 152
=============== ============ ============ ============ ============ ============
Ratio of Earnings to Fixed Charges 4.7 2.7 3.3 (1) 2.5 5.5
=============== ============ ============ ============ ============ ============
Ratio of Earnings to Combined
Fixed Charges and Preferred
Stock Dividend Requirements 4.0 2.3 3.1 (2) 1.6 3.4
=============== ============ ============ ============ ============ ============
</TABLE>
(1) Earnings for the year ended December 31, 1992, were inadequate to cover
fixed charges by $331 million.
(2) Earnings for the year ended December 31, 1992, were inadequate to cover
combined fixed charges and preferred stock dividend requirements by $346
million.
