<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON DECEMBER 11, 1995
REGISTRATION STATEMENT NO. 33-
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- -------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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LEHMAN BROTHERS HOLDINGS INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE 13-3216325
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER IDENTIFICATION NUMBER)
INCORPORATION OR ORGANIZATION)
---------------
THOMAS A. RUSSO, ESQ.
3 WORLD FINANCIAL CENTER 3 WORLD FINANCIAL CENTER
NEW YORK, NEW YORK 10285 NEW YORK, NEW YORK 10285
(212) 526-7000 (212) 526-7000
(ADDRESS, INCLUDING ZIP CODE, AND (NAME, ADDRESS, INCLUDING ZIP CODE, AND
TELEPHONE NUMBER, INCLUDING AREA TELEPHONE
CODE, OF REGISTRANT'S PRINCIPAL NUMBER, INCLUDING AREA CODE, OF AGENT
EXECUTIVE OFFICES) FOR SERVICE)
Copy to:
RAYMOND W. WAGNER, ESQ. LOUISE PARENT, ESQ. JENNIFER MARRE, ESQ.
SIMPSON THACHER & AMERICAN EXPRESS COMPANY LEHMAN BROTHERS INC. 3
BARTLETT 3 WORLD FINANCIAL CENTER WORLD FINANCIAL CENTER
425 LEXINGTON AVENUE NEW NEW YORK, NEW YORK 10285 NEW YORK, NEW YORK 10285
YORK, NEW YORK 10017
---------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE AND DISTRIBUTION TO THE
PUBLIC: From time to time after the effective date of this Registration
Statement, as determined by market conditions.
IF THE ONLY SECURITIES BEING REGISTERED ON THIS FORM ARE BEING OFFERED
PURSUANT TO DIVIDEND OR INTEREST REINVESTMENT PLANS, PLEASE CHECK THE
FOLLOWING BOX. [_]
IF ANY OF THE SECURITIES BEING REGISTERED ON THIS FORM ARE TO BE OFFERED ON
A DELAYED OR CONTINUOUS BASIS PURSUANT TO RULE 415 UNDER THE SECURITIES ACT OF
1933 OTHER THAN SECURITIES OFFERED ONLY IN CONNECTION WITH DIVIDEND OR
INTEREST REINVESTMENT PLANS, CHECK THE FOLLOWING BOX. [X]
IF THIS FORM IS FILED TO REGISTER ADDITIONAL SECURITIES FOR AN OFFERING
PURSUANT TO RULE 462(B) UNDER THE SECURITIES ACT, PLEASE CHECK THE FOLLOWING
BOX AND LIST THE SECURITIES ACT REGISTRATION STATEMENT NUMBER OF THE EARLIER
EFFECTIVE REGISTRATION STATEMENT FOR THE SAME OFFERING. [_]
IF THIS FORM IS A POST-EFFECTIVE AMENDMENT FILED PURSUANT TO RULE 462(C)
UNDER THE SECURITIES ACT, CHECK THE FOLLOWING BOX AND LIST THE SECURITIES ACT
REGISTRATION STATEMENT NUMBER OF THE EARLIER EFFECTIVE REGISTRATION STATEMENT
FOR THE SAME OFFERING. [_]
IF DELIVERY OF THE PROSPECTUS IS EXPECTED TO BE MADE PURSUANT TO RULE 434,
PLEASE CHECK THE FOLLOWING BOX. [_]
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CALCULATION OF REGISTRATION FEE
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<TABLE>
<CAPTION>
PROPOSED
PROPOSED MAXIMUM
MAXIMUM AGGREGATE AMOUNT OF
TITLE OF EACH CLASS OF SECURITIES AMOUNT TO BE OFFERING PRICE OFFERING REGISTRATION
TO BE REGISTERED REGISTERED PER SHARE PRICE(1) FEE
- ---------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
8.44% Cumulative Voting
Preferred Stock, par
value $1.00 per
share................. 8,000,000 shares $25(1) $200,000,000 U.S. $68,966
</TABLE>
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- -------------------------------------------------------------------------------
(1) Estimated solely for the purpose of calculating the registration fee.
---------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT
SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS
REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH
SECTION 8(A) OF THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT
SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID
SECTION 8(A), MAY DETERMINE.
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- -------------------------------------------------------------------------------
<PAGE>
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A +
+REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE +
+SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY +
+OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT +
+BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR +
+THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE +
+SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE +
+UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF +
+ANY SUCH STATE. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
Subject to Completion, dated December 11, 1995
PROSPECTUS
LEHMAN BROTHERS HOLDINGS INC.
8.44% CUMULATIVE VOTING PREFERRED STOCK
(LIQUIDATION PREFERENCE $25.00 PER SHARE)
-----------
This Prospectus relates to 8,000,000 shares of 8.44% Cumulative Voting
Preferred Stock, $1.00 par value per share (the "8.44% Preferred Stock"), of
Lehman Brothers Holdings Inc. ("Holdings") to be offered and sold by American
Express Travel Related Services Company, Inc. (the "Selling Stockholder").
Holdings will not receive any of the proceeds from the sale of the 8.44%
Preferred Stock by the Selling Stockholder.
Dividends with respect to the 8.44% Preferred Stock are payable in cash,
when, as and if declared by the Board of Directors of Holdings, at a rate of
8.44% per annum per share on the 15th day of March, June, September and
December of each year. Dividends are cumulative and have accrued and been paid
on each share of the 8.44% Preferred Stock from the date of original issuance
thereof.
The Company may, in its discretion, redeem for cash the 8.44% Preferred Stock
as a whole, or from time to time in part, at any time, on or after June 1, 2002
upon not less than 30 days' prior notice at $25.00 per share plus dividends
accrued and accumulated but unpaid to, but excluding, the date fixed for
redemption.
Holders of the 8.44% Preferred Stock are entitled to vote, together with the
holders of Holdings' common stock (the "Common Stock"), as one class on all
matters to be voted on by stockholders of Holdings. Each share of the 8.44%
Preferred Stock is entitled to 0.295 votes per share.
Application will be made to list the 8.44% Preferred Stock on the New York
Stock Exchange under the symbol " ".
-----------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
-----------
The 8.44% Preferred Stock will be sold by the Selling Stockholder in
secondary market transactions that will be either privately negotiated or
effected through underwriters or agents who may be registered broker-dealers
(which may include Lehman Brothers Inc., a subsidiary of Holdings ("Lehman
Brothers")). Each Prospectus Supplement will set forth the names of any
underwriters or agents involved in the sale of the Securities in respect of
which this Prospectus is being delivered, the number of shares, if any, to be
purchased by underwriters or sold through agents and the compensation, if any,
of such underwriters or agents. The Selling Stockholder will be responsible for
all discounts or commissions incurred in the sale of the 8.44% Preferred Stock.
See "Plan of Distribution."
-----------
<PAGE>
AVAILABLE INFORMATION
Holdings is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files reports and other information with the Securities and Exchange
Commission (the "SEC"). Such reports and information may be inspected and
copied at the public reference facilities maintained by the SEC at 450 Fifth
Street, N.W., Washington, D.C. 20549, and at the following Regional Offices of
the SEC: New York Regional Office, 7 World Trade Center, New York, New York
10048; and Chicago Regional Office, Suite 1400, Northwestern Atrium Center,
500 W. Madison Street, Chicago, Illinois 60661-2511; and copies of such
material can be obtained from the Public Reference Section of the SEC,
Washington, D.C. 20549, at prescribed rates. The Common Stock is listed on the
New York Stock Exchange, Inc. (the "Exchange") and the Pacific Stock Exchange
Inc. (the "PSE"). Holdings' 8 3/4% Notes Due 2002 and Holdings Medium-Term
Note, Series E, Due September 20, 1996 are listed on the Exchange. Holdings'
$55 Million Serial Zero Coupon Senior Notes Due May 16, 1998, FT-SE Eurotrack
200 Index Call Warrants expiring June 4, 1996, 7 1/4% Oracle Yield Enhanced
Equity Linked Debt Securities SM due 1996, 6 1/2% Amgen Yield Enhanced Equity
Linked Debt Securities Due 1997, Japanese Yen Bear Warrants Expiring March 5,
1996, Global Telecommunications Stock Upside Note Securities SM Due 2000, 9
1/8% Micron Yield Enhanced Equity Linked Debt Securities Due 1997, AMEX Hong
Kong 30 Index Call Warrants and Regional Bank Stock Upside Note Securities SM
Due 1996 are listed on the American Stock Exchange, Inc. (the "ASE"). Reports
and other information concerning Holdings may also be inspected at the offices
of the Exchange at 20 Broad Street, New York, New York 10005, at the offices
of the ASE, 86 Trinity Place, New York, New York 10006 and at the offices of
the PSE, 301 Pine Street, San Francisco, California 94104.
Holdings has filed with the SEC a registration statement on Form S-3
(herein, together with all amendments and exhibits, referred to as the
"Registration Statement") under the Securities Act of 1933, as amended (the
"Securities Act"). This Prospectus does not contain all of the information set
forth in the Registration Statement, certain parts of which are omitted in
accordance with the rules and regulations of the SEC. For further information,
reference is hereby made to the Registration Statement.
----------------
DOCUMENTS INCORPORATED BY REFERENCE
The following documents previously filed by Holdings with the SEC pursuant
to the Exchange Act are hereby incorporated by reference in this Prospectus:
(1) Holdings' Transition Report on Form 10-K for the eleven months ended
November 30, 1994.
(2) Holdings' Quarterly Reports on Form 10-Q for the fiscal quarters
ended February 28, 1995, May 31, 1995 and August 31, 1995.
(3) Holdings' Current Reports on Form 8-K dated January 6, 1995, March
24, 1995, June 28, 1995 and September 21, 1995.
Each document filed by Holdings pursuant to Section 13(a), 13(c), 14 or
15(d) of the Exchange Act after the date of this Prospectus and prior to the
termination of the offering of the 8.44% Preferred Stock offered by an
applicable Prospectus Supplement shall be deemed to be incorporated by
reference into this Prospectus from the date of filing of such document. Any
statement contained in a document incorporated or deemed to be incorporated by
reference herein shall be deemed to be modified or superseded for purposes of
this Registration Statement and this Prospectus to the extent that a statement
contained herein, in an applicable Prospectus Supplement or in any
subsequently filed document which also is or is deemed to be incorporated by
reference herein modifies or supersedes such statement. Any such statement so
modified or superseded shall not be deemed, except as so modified or
superseded, to constitute a part of the Registration Statement or this
Prospectus.
Holdings will provide without charge to each person, including any
beneficial owner of any of the 8.44% Preferred Stock, to whom a copy of this
Prospectus is delivered, upon the written or oral request of any such person,
a copy of any or all of the documents which are incorporated herein by
reference, other than exhibits to such documents (unless such exhibits are
specifically incorporated by reference into such documents). Requests should
be directed to Mary Jo Capko, the Controller's Office, Lehman Brothers
Holdings Inc., 3 World Financial Center, 27th Floor, New York, New York 10285
(telephone (212) 526-0660).
2
<PAGE>
THE COMPANY
Lehman Brothers Holdings Inc. (together with its consolidated subsidiaries,
hereinafter referred to as the "Company" unless the context otherwise requires)
is one of the leading global investment banks serving institutional, corporate,
government and high net worth individual clients and customers. The Company's
worldwide headquarters in New York and regional headquarters in London, Tokyo,
Hong Kong and Singapore are complemented by offices in additional locations in
the United States, Europe, the Middle East, Latin and South America.
The Company's business includes capital raising for clients through
securities underwriting and direct placements; corporate finance and strategic
advisory services; merchant banking; securities sales and trading; asset
management; research; and the trading of foreign exchange, derivative products
and certain commodities. The Company acts as a market marker in all major
equity and fixed income products in both the domestic and international
markets. The Company is a member of all principal securities and commodities
exchanges in the United States, as well as the National Association of
Securities Dealers, Inc. ("NASD"), and holds memberships or associate
memberships on several principal international securities and commodities
exchanges, including the London, Tokyo, Hong Kong, Frankfurt and Milan stock
exchanges.
Holdings was incorporated in Delaware on December 29, 1983. Holdings'
principal executive offices are located at 3 World Financial Center, New York,
New York 10285 (telephone (212) 526-7000).
RATIO OF EARNINGS TO COMBINED FIXED CHARGES AND PREFERRED STOCK DIVIDENDS
The following table sets forth the ratio of earnings to combined fixed
charges and preferred stock dividends of the Company for each of the four years
in the period ended December 31, 1993, the eleven months ended November 30,
1994 and the nine months ended August 31, 1995:
<TABLE>
<CAPTION>
ELEVEN MONTHS NINE MONTHS
YEAR ENDED DECEMBER 31 ENDED ENDED
------------------------------------------ NOVEMBER 30, AUGUST 31,
1990 1991 1992 1993 1994 1995
---- ------ ----- ----- ------------- -----------
<S> <C> <C> <C> <C> <C>
* 1.02 * * 1.02 1.03
</TABLE>
* Earnings were inadequate to cover fixed charges and would have had to
increase approximately $814 million in 1990, $295 million in 1992 and $27
million in 1993 in order to cover the deficiencies for the respective
periods.
In computing the ratio of earnings to combined fixed charges and preferred
stock dividends, "earnings" consist of earnings from continuing operations
before income taxes and fixed charges. "Fixed charges" consist principally of
interest expense and one-third of office rentals and one-fifth of equipment
rentals, which are deemed to be representative of the interest factor.
SELLING STOCKHOLDER
Prior to May 31, 1994, American Express Company ("American Express") owned
100% of the Common Stock, which represented approximately 93% of Holdings'
voting stock. On May 31, 1994, American Express paid a special dividend to its
common shareholders consisting of all of the Common Stock it then held (the
"Distribution") and Holdings became a widely-held public company with the
Common Stock traded on the New York Stock Exchange. Prior to the Distribution,
on April 28, 1994, Holdings issued and sold to American Express 8,000,000
shares of the 8.44% Preferred Stock, which constitutes all of the issued and
outstanding shares of the 8.44% Preferred Stock.
3
<PAGE>
The Company has certain continuing relationships with American Express and
certain of its subsidiaries (including the Selling Stockholder) arising out of
American Express' prior ownership of the Company. These include an agreement
providing for the allocation and settlement of the companies' respective tax
liabilities for periods for which the Company was included in consolidated tax
returns with American Express, the co-tenancy of the leasehold interest in 3
World Financial Center in New York City (the "Property") and shared liability
on the long-term debt issued to finance the Property (the "WFC Indebtedness").
The WFC Indebtedness is guaranteed by American Express, which in turn is
indemnified by Holding for all payments that American Express may be required
to make on behalf of the Company. In addition, American Express owns 92.8% of
the outstanding shares of Holdings' Redeemable Preferred Stock. See "The Other
Outstanding Preferred Stock--Redeemable Preferred Stock" below.
The Company also provides various financial services to American Express and
its subsidiaries, including acting as placement agent for medium-term notes,
dealer for commercial paper and advisor regarding certain transactions. The
Company, American Express and its subsidiaries also engage in the ordinary
course of business in various trading and short-term funding transactions. All
of these transactions are done on an arms' length basis with customary fees.
On May 27, 1994, American Express transferred and assigned all of its rights
in the 8.44% Preferred Stock to American Express Travel Related Services
Company, Inc., a wholly owned subsidiary of American Express (the "Selling
Stockholder"). The shares of 8.44% Preferred Stock being offered hereby are
owned by the Selling Stockholder. Holdings will not receive any proceeds from
the sale of the 8.44% Preferred Stock by the Selling Stockholder.
DESCRIPTION OF THE 8.44% PREFERRED STOCK
The summary of terms of the 8.44% Preferred Stock set forth below contains
all material terms of the 8.44% Preferred Stock but does not purport to be
complete and is subject to, and qualified in its entirety by, the provisions of
Holdings' Restated Certificate of Incorporation (the "Restated Certificate of
Incorporation"), filed as an exhibit to the Registration Statement of which
this Prospectus is a part.
The Restated Certificate of Incorporation authorizes the issuance of
38,000,000 shares of Preferred Stock, $1.00 par value per share (the "Preferred
Stock"). As of October 30, 1995, there were 8,000,000 shares of the 8.44%
Preferred Stock, 13,000,000 shares of Cumulative Convertible Voting Preferred
Stock, Series A (the "Series A Preferred Stock"), and 1,000 shares of
Redeemable Voting Preferred Stock (the "Redeemable Preferred Stock") issued and
outstanding. The 8.44% Preferred Stock ranks, as to dividends and upon
liquidation, dissolution or winding up, on a parity with the Series A Preferred
Stock and the Redeemable Preferred Stock. The term "Parity Preferred Stock"
used herein means any stock on a parity with the 8.44% Preferred Stock, either
as to dividends or upon liquidation, dissolution or winding up, or both, as the
context may require.
Subject to the Restated Certificate of Incorporation and to any limitations
contained in then outstanding Preferred Stock, Holdings may issue additional
classes or series of Preferred Stock, at any time or from time to time, with
such powers, preferences and relative, participating, optional or other special
rights and qualifications, limitations or restrictions thereof, as the Board of
Directors or any duly authorized committee thereof shall determine, all without
further action of the stockholders, including holders of then outstanding
Preferred Stock, of Holdings.
THE 8.44% PREFERRED STOCK
Dividends. Holders of the 8.44% Preferred Stock are entitled to receive,
when, as and if declared by the Board of Directors or a duty authorized
committee thereof out of assets legally available therefor, cumulative cash
dividends at a rate of 8.44% per annum, payable quarterly on March 15, June 15,
September
4
<PAGE>
15 and December 15 of each year. Dividends will be payable in arrears to
holders of record as they appear on the stock books of Holdings on such record
dates, not more than 60 days or less than 10 days preceding the payment dates
thereof, as shall be fixed by the Board of Directors.
No dividends may be declared or paid or set apart for payment on any Parity
Preferred Stock with regard to the payment of dividends unless there shall also
be or have been declared and paid or set apart for payment on the 8.44%
Preferred Stock, dividends for all dividend payment periods of the 8.44%
Preferred Stock ending on or before the dividend payment date of such Parity
Preferred Stock, ratably in proportion to the respective amounts of dividends
(x) accumulated and unpaid or payable on such Parity Preferred Stock, on the
one hand, and (y) accumulated and unpaid through the dividend payment period or
periods of the 8.44% Preferred Stock next preceding such dividend payment date,
on the other hand.
Except as set forth in the preceding sentence, unless full cumulative
dividends on the 8.44% Preferred Stock have been paid through the most recently
completed quarterly dividend period for the 8.44% Preferred Stock, no dividends
(other than in the Common Stock) may be paid or declared and set aside for
payment or other distribution made upon the Common Stock or on any other stock
of Holdings ranking junior to or on a parity with the 8.44% Preferred Stock as
to dividends, nor may any of the Common Stock or shares of any other stock of
Holdings ranking junior to or on a parity with the 8.44% Preferred Stock as to
dividends be redeemed, purchased or otherwise acquired for any consideration
(or any payment be made to or available for a sinking fund for the redemption
of any shares of such stock; provided, however, that any moneys theretofore
deposited in any sinking fund with respect to any preferred stock of Holdings
in compliance with the provisions of such sinking fund may thereafter be
applied to the purchase or redemption of such preferred stock in accordance
with the terms of such sinking fund, regardless of whether at the time of such
application full cumulative dividends upon shares of the 8.44% Preferred Stock
outstanding to the last dividend payment date shall have been paid or declared
and set apart for payment), provided that any such junior or parity stock or
the Common Stock may be converted into or exchanged for shares of stock ranking
junior to the 8.44% Preferred Stock as to dividends.
Redemption. The 8.44% Preferred Stock may be redeemed at the option of
Holdings, as a whole, or from time to time in part, at any time, upon not less
than 30 days' prior notice mailed to the holders of the shares to be redeemed
at their addresses as shown on the stock books of Holdings; provided, however,
that shares of the 8.44% Preferred Stock shall not be redeemable prior to June
1, 2001. Subject to the foregoing, on or after such date, shares of the 8.44%
Preferred Stock are redeemable at a redemption price equal to $25.00 per share
together with an amount equal to all dividends (whether or not earned or
declared) accrued and accumulated and unpaid to, but excluding, the date fixed
for redemption.
If full cumulative dividends on the 8.44% Preferred Stock have not been paid,
the 8.44% Preferred Stock may not be redeemed in part and Holdings may not
purchase or acquire any shares of the 8.44% Preferred Stock otherwise than
pursuant to a purchase or exchange offer made on the same terms to all holders
of the 8.44% Preferred Stock. If fewer than all the outstanding shares of 8.44%
Preferred Stock are to be redeemed, Holdings will select those to be redeemed
by lot or a substantially equivalent method.
Voting Rights. Holders of the 8.44% Preferred Stock, in addition to any
voting rights to which they may be entitled under Delaware law, are entitled to
vote, together with the holders of the Common Stock, as one class on all
matters voted on by holders of the Common Stock. Each share of the 8.44%
Preferred Stock is entitled to 0.295 votes per share. In addition, if the
equivalent of six quarterly dividends or more (whether or not consecutive) on
the 8.44% Preferred Stock or any Parity Preferred Stock shall be in arrears,
then the authorized number of directors of Holdings shall be increased by two
and the holders of the 8.44% Preferred Stock have the right (voting as a class
with the holders of any other Parity Preferred Stock of Holdings upon which
like voting rights have been conferred and are exercisable) the ("Voting Parity
Preferred Stock") to elect such two directors (the "Preferred Directors") to
fill such newly created directorships at Holdings' next annual meeting of
stockholders and at each subsequent annual meeting of stockholders until such
arrears have been paid or set aside for payment, at which time such right shall
terminate except as herein or by law
5
<PAGE>
expressly provided, subject to revesting in the event of each and every
subsequent default of the character above mentioned. Upon any termination of
the right of the holders of shares of the 8.44% Preferred Stock and Voting
Parity Stock as a class to vote for directors as provided above, the term of
office of all Preferred Directors then in office shall terminate immediately
and the authorized number of directors shall be reduced by the number of
Preferred Directors elected pursuant hereto. Any Preferred Director may be
removed at any time, with or without cause. Any vacancy created thereby may be
filled only by the affirmative vote of the holders of shares of the 8.44%
Preferred Stock voting separately as a class (together with the holders of
shares of Voting Parity Stock). If the office of any Preferred Director becomes
vacant for any reason other than removal from office as aforesaid, the
remaining Preferred Director may choose a successor who shall hold office for
the unexpired term in respect of which such vacancy occurred. At elections for
Preferred Directors, each holder of shares of the 8.44% Preferred Stock shall
be entitled to one vote for each share held (the holders of shares of any other
class or series of Voting Parity Stock being entitled to such number of votes,
if any, for each share of such stock held as may be granted to them).
So long as any shares of the 8.44% Preferred Stock remain outstanding,
Holdings shall not, without the consent of the holders of at least two-thirds
of such shares of the 8.44% Preferred Stock, either in writing or at a meeting,
(i) issue or increase the authorized amount of shares of any stock of Holdings
ranking, as to dividends or upon liquidation, dissolution or winding up, prior
to such shares of the 8.44% Preferred Stock or (ii) amend, alter or repeal,
whether by merger, consolidation or otherwise, any provisions of the Restated
Certificate of Incorporation that would materially and adversely affect any
power, preference or special right of such shares of the 8.44% Preferred Stock,
provided that any increase in the amount of authorized Common Stock or
authorized preferred stock, or any increase or decrease in the number of shares
of any series of preferred stock or the authorization, creation and issuance of
other classes or series of the Common Stock or other stock, in each case
ranking on a parity with or junior to the shares of the 8.44% Preferred Stock
with respect to the payment of dividends and the distribution of assets upon
liquidation, dissolution or winding up, shall not be deemed to materially and
adversely affect such powers, preferences or special rights.
Authorization and Issuance of Other Securities. No consent of the holders of
the 8.44% Preferred Stock shall be required for (i) the creation of any
indebtedness of any kind of Holdings, (ii) the authorization, creation or
increase, or decrease in the amount, of any class or series of stock of
Holdings not ranking prior as to dividends or upon liquidation, dissolution or
winding up to the 8.44% Preferred Stock or (iii) any increase or decrease in
the amount of authorized Common Stock or any increase, decrease or change in
the par value thereof or in any other terms thereof.
Liquidation. Upon any voluntary or involuntary liquidation, dissolution or
winding up of Holdings, holders of the 8.44% Preferred Stock then outstanding
shall be entitled to receive out of the assets of Holdings available for
distribution to its stockholders, after any distribution is made to or set
aside for holders of senior securities and before any distribution is made to
holders of the Common Stock or any other stock of Holdings ranking junior to
the 8.44% Preferred Stock as to rights upon liquidation, dissolution or winding
up of Holdings, the liquidation preference of $25.00 per share, together with
any accumulated and unpaid dividends. After payment of the full amount of the
liquidation preference and such dividends, the holders of shares of the 8.44%
Preferred Stock will not be entitled to any further participation in any
distribution of assets by Holdings. If, upon any liquidation, dissolution or
winding up of the assets of Holdings, the assets of Holdings, or proceeds
thereof, distributable among the holders of shares of Parity Preferred Stock
shall be insufficient to pay in full the preferential amount aforesaid, then
such assets, or the proceeds thereof, shall be distributable among such holders
ratably in accordance with the respective amounts which would be payable on
such shares if all amounts payable thereon were paid in full. Neither a
consolidation or merger of Holdings with or into any other corporation, nor a
merger of any other corporation with or into Holdings, nor a sale or transfer
of all or any part of Holdings' assets shall be considered a liquidation,
dissolution or winding up of Holdings.
The Restated Certificate of Incorporation does not contain any language
requiring funds to be set aside to protect the liquidation preference of the
8.44% Preferred Stock, although such liquidation preference is
6
<PAGE>
substantially in excess of the par value of the 8.44% Preferred Stock. In
addition, Holdings is not aware of any provision of Delaware law or any
controlling decision of the courts of the State of Delaware (the state of
incorporation of Holdings) that requires a restriction upon the surplus of
Holdings solely because the liquidation preference of the 8.44% Preferred Stock
exceeds its par value. Consequently, there will be no restriction upon surplus
of Holdings solely because the liquidation preference of the the 8.44%
Preferred Stock exceeds the par value and there will be no remedies available
to holders of the 8.44% Preferred Stock before or after the payment of any
dividend, other than in connection with the liquidation of Holdings, solely by
reason of the fact that such dividend would reduce the surplus of Holdings to
an amount less than the difference between the liquidation preference of the
8.44% Preferred Stock and its par value.
Convertibility. The 8.44% Preferred Stock is not convertible into, or
exchangeable for, other shares of any other class or series of stock of
Holdings.
MISCELLANEOUS. The holders of the 8.44% Preferred Stock will have no
preemptive rights. Shares of the 8.44% Preferred Stock redeemed or otherwise
reacquired by Holdings shall be retired and, upon the taking of any action
required by applicable law, resume the status of authorized and unissued shares
of the 8.44% Preferred Stock undesignated as to series, and shall be available
for subsequent issuance. The 8.44% Preferred Stock will not have any
preferences, voting powers or relative, participating, optional or other
special rights except as set forth above or as otherwise required by law.
TRANSFER AGENT AND REGISTRAR. The transfer agent and registrar for the 8.44%
Preferred Stock will be The First National Bank of Boston.
THE OTHER OUTSTANDING PREFERRED STOCK
SERIES A PREFERRED STOCK. As of the date of this Prospectus, Nippon Life
Insurance Company ("Nippon Life") owns all of the issued and outstanding shares
of the Series A Preferred Stock.
Holders of the Series A Preferred Stock are entitled to receive preferential
dividends, as and when declared by the Board of Directors out of funds legally
available therefor, in an amount equal to 5% per annum of the price per share
paid by Nippon Life ($39.10) upon purchase of the Series A Preferred Stock
payable quarterly on a cumulative basis. The liquidation preference of the
Series A Preferred Stock is equal to $39.10 plus accumulated and unpaid
dividends. Holdings may redeem shares of the Series A Preferred Stock in
cumulative annual increments of 2,600,000 shares, subject to adjustment for
shares theretofore converted, at a price per share equal to $39.10, but only if
there is a public market for the Common Stock and the average market price of
the Common Stock exceeds the conversion price on the date notice of redemption
is given.
Each share of the Series A Preferred Stock is convertible, at any time prior
to the date of redemption, into 0.3178313, subject to adjustment, of a share of
the Common Stock, provided that at least 250,000 shares of the Series A
Preferred Stock (or such lesser number of shares then outstanding) must be
converted each time. Holders of the Series A Preferred Stock are entitled to
vote, together with the holders of the Common Stock as one class (except as
otherwise required by law), on all matters to be voted on by stockholders of
Holdings. Each share of the Series A Preferred Stock is entitled to the number
of votes per share equal to the quotient obtained by dividing $39.10 by the
conversion price then in effect. In addition, the holders of the Series A
Preferred Stock have voting rights in certain other circumstances.
Nippon Life has the non-transferable right to exchange the Series A Preferred
Stock for common shares of American Express. In addition, Holdings has the
right to redeem the Series A Preferred Stock if the average market price of
American Express' common shares exceeds the exchange price on the date notice
of redemption is given.
REDEEMABLE PREFERRED STOCK. As of the date of this Prospectus, American
Express and Nippon Life together own all of the issued and outstanding shares
of the Redeemable Preferred Stock.
7
<PAGE>
Holders of the Redeemable Preferred Stock are entitled to receive
preferential dividends, as and when declared by the Board of Directors out of
funds legally available therefor, on a cumulative basis. For each of eight
annual dividend periods following May 31, 1994, the holders of the Redeemable
Preferred Stock are entitled to receive dividends in an amount equal to, in the
aggregate, 50% of the amount, if any, by which Holdings' net income for the
applicable dividend period exceeds $400 million, up to a maximum of $50 million
for any such period (the "Dividend Formula"). The liquidation preference per
share of the Redeemable Preferred Stock is $1.00 plus accumulated and unpaid
dividends and accrued interest, if any, thereon at a specified rate.
Subject to funds being legally available therefor, Holdings is required to
redeem all of the Redeemable Preferred Stock on the final dividend payment date
therefor, or as soon as practicable thereafter when funds become legally
available, at a price per share equal to the liquidation preference referred to
above. In addition, if a Designated Event (as defined in the Restated
Certificate of Incorporation) occurs, the holders of the Redeemable Preferred
Stock have the right to require Holdings to redeem, out of funds legally
available therefor, all of the Redeemable Preferred Stock for an aggregate
redemption price equal to $350 million if such Designated Event takes place
prior to November 30, 1995, declining $50 million per year in each of the next
seven years thereafter.
Holders of the Redeemable Preferred Stock are entitled to vote, together with
the holders of the Common Stock as one class, on all matters to be voted on by
stockholders of Holdings. Notwithstanding the foregoing, American Express has
agreed that so long as it or any of its subsidiaries holds any shares of the
Redeemable Preferred Stock, it will vote such shares in the same proportion as
the votes cast by the holders of shares of the Common Stock on matters to be
voted on by stockholders of Holdings generally. Each share of the Redeemable
Preferred Stock is entitled to 1,059 votes. In addition, if the equivalent of
six quarterly dividends (whether or not consecutive) to which the holders of
the Redeemable Preferred Stock are entitled in accordance with the Dividend
Formula, or to which the holders of any Parity Preferred Stock are entitled
pursuant to the terms of such Parity Preferred Stock, are in arrears, then the
authorized number of directors of Holdings shall be increased by two and the
holders of the Redeemable Preferred Stock will have the right (voting as a
class with the holders of any other Parity Preferred Stock of Holdings upon
which like voting rights have been conferred and are exercisable) to elect such
two directors until such time as all accumulated dividends have been paid. In
addition, the holders of the Redeemable Preferred Stock have voting rights in
certain other circumstances.
CAPITAL REQUIREMENTS
As registered broker-dealers, Lehman Brothers and certain of Holdings' other
subsidiaries (the "Regulated Subsidiaries") are subject to the SEC's net
capital rule (Rule 15c3-1, the "Net Capital Rule"), promulgated under the
Exchange Act. The Exchange monitors the application of the Net Capital Rule by
Lehman Brothers. The Exchange or the NASD, as the case may be, monitors the
application of the Net Capital Rule by the Regulated Subsidiaries. Lehman
Brothers and such Regulated Subsidiaries compute net capital under the
alternative method of the Net Capital Rule which requires the maintenance of
minimum net capital, as defined. A broker-dealer may be required to reduce its
business if its net capital is less than 4% of aggregate debit balances and may
also be prohibited from expanding its business or paying cash dividends if
resulting net capital would be less than 5% of aggregate debit balances. In
addition, the Net Capital Rule does not allow withdrawal of subordinated
capital if net capital would be less than 5% of such debit balances.
The Net Capital Rule also limits the ability of broker-dealers to transfer
large amounts of capital to parent companies and other affiliates. Under the
Net Capital Rule equity capital can not be withdrawn from a broker-dealer
without the prior approval of the SEC when net capital after the withdrawal
would be less than 25% of its securities positions haircuts (which are
deductions from capital of certain specified percentages of the market value of
securities to reflect the possibility of a market decline prior to
disposition).
8
<PAGE>
In addition, the Net Capital Rule requires broker-dealers to notify the SEC and
the appropriate self-regulatory organization two business days before a
withdrawal of excess net capital if the withdrawal would exceed the greater of
$500,000 or 30% of the broker-dealer's excess net capital, and two business
days after a withdrawal that exceeds the greater of $500,000 or 20% of excess
net capital. Finally, the Net Capital Rule authorizes the SEC to order a freeze
on the transfer of capital if a broker-dealer plans a withdrawal of more than
30% of its excess net capital and the SEC believes that such a withdrawal would
be detrimental to the financial integrity of the firm or would jeopardize the
broker-dealer's ability to pay its customers.
Compliance with the Net Capital Rule could limit those operations of Lehman
Brothers and the Regulated Subsidiaries that require the intensive use of
capital, such as underwriting and trading activities and the financing of
customer account balances, and also could restrict Holdings' ability to
withdraw capital from Lehman Brothers and the Regulated Subsidiaries which in
turn could limit Holdings' ability to pay dividends, repay debt and redeem or
purchase shares of its outstanding capital stock. The Company is subject to
other domestic and international regulatory requirements with which it is
required to comply.
PLAN OF DISTRIBUTION
The Company has been advised that the shares of the 8.44% Preferred Stock
being offered hereby may be sold by or on behalf of the Selling Stockholder in
any one or more of the following ways: (i) through one or more underwriters;
(ii) through one or more dealers or agents; or (iii) directly to one or more
purchasers. The specific managing underwriter or underwriters or agent or
agents (which, in each case, may include Lehman Brothers) with respect to the
offer and sale of the shares of the 8.44% Preferred Stock are set forth on the
cover of the Prospectus Supplement relating to such shares of the 8.44%
Preferred Stock, and the members of the underwriting syndicate, if any, are
named in such Prospectus Supplement. Only the underwriters or agents so named
in such Prospectus Supplement are underwriters or agents, respectively, in
connection with such shares of the 8.44% Preferred Stock. The applicable
Prospectus Supplement also describes the discounts and commissions to be
allowed or paid to the underwriters or agents, all other items constituting
underwriting or agency compensation and the discounts and commissions to be
allowed or paid to dealers, if any. Shares of the 8.44% Preferred Stock
acquired by any underwriter will be acquired for its own account and may be
resold from time to time in one or more transactions, including negotiated
transactions, at a fixed public offering price or at varying prices determined
at the time of sale. The obligations of the underwriters to purchase shares of
the 8.44% Preferred Stock will be subject to certain conditions precedent, and
the underwriters will be obligated to purchase all such shares if any of such
shares are purchased. Any initial public offering price and any discounts or
concessions allowed or reallowed or paid to dealers may be changed from time to
time.
Holdings will not receive any of the proceeds from the sales of the 8.44%
Preferred Stock. Holdings has agreed to bear the expenses of registering the
8.44% Preferred Stock, including legal and accounting fees. The Selling
Stockholders will be responsible for all discounts or commissions incurred in
the sale of the 8.44% Preferred Stock.
The underwriting and agency arrangements for any offering of the 8.44%
Preferred Stock will comply with the requirements of Schedule E of the By-laws
of the NASD regarding an NASD member firm participating in distributing its
affiliate's securities.
LEGAL OPINIONS
Unless otherwise indicated in an applicable Prospectus Supplement, the
validity of the securities offered hereby will be passed upon for Holdings by
Karen M. Muller, Esq., Deputy General Counsel of Holdings, and for the
underwriters or agents by Simpson Thacher & Bartlett (a partnership which
includes professional corporations), 425 Lexington Avenue, New York, New York
10017. Simpson Thacher & Bartlett acts as counsel in various matters for
Holdings, Lehman Brothers and certain of their subsidiaries.
9
<PAGE>
INDEPENDENT ACCOUNTANTS
The consolidated financial statements and schedules of the Company for the
eleven months ended November 30, 1994 and for the years ended December 31, 1993
and December 31, 1992, appearing in the Company's Transition Report on Form 10-
K for the eleven months ended November 30, 1994, have been audited by Ernst &
Young LLP, independent auditors, as set forth in their report thereon included
therein and incorporated herein by reference. Such consolidated financial
statements and schedules are, and audited financial statements included in
subsequently filed documents will be, incorporated herein by reference in
reliance upon the reports of Ernst & Young LLP pertaining to such financial
statements (to the extent covered by consents filed with the SEC) given upon
the authority of such firm as experts in accounting and auditing.
10
<PAGE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
NO DEALER, SALESPERSON OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATION NOT CONTAINED IN THIS PROSPECTUS
AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION MUST NOT BE RELIED
UPON AS HAVING BEEN AUTHORIZED BY HOLDINGS OR ANY AGENT OR UNDERWRITER. THIS
PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER
TO BUY ANY OF THE SECURITIES OFFERED HEREBY IN ANY JURISDICTION TO ANY PERSON
TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER IN SUCH JURISDICTION. NEITHER THE
DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL, UNDER ANY
CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE
AFFAIRS OF HOLDINGS SINCE THE DATE OF THIS PROSPECTUS.
------------------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
AVAILABLE INFORMATION...................................................... 2
DOCUMENTS INCORPORATED BY
REFERENCE................................................................. 2
THE COMPANY................................................................ 3
RATIO OF EARNINGS TO COMBINED
FIXED CHARGES AND PREFERRED
STOCK DIVIDENDS........................................................... 3
SELLING STOCKHOLDER........................................................ 3
DESCRIPTION OF THE 8.44% PREFERRED STOCK................................... 4
CAPITAL REQUIREMENTS....................................................... 8
PLAN OF DISTRIBUTION....................................................... 8
LEGAL OPINIONS............................................................. 9
INDEPENDENT ACCOUNTANTS.................................................... 9
</TABLE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
LEHMAN BROTHERS HOLDINGS INC.
8.44% CUMULATIVE VOTING PREFERRED STOCK
------------------
PROSPECTUS
, 1995
------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following are the estimated expenses to be incurred and paid by the
Registrant in connection with the offering described in this Registration
Statement other than underwriting discounts and commissions. All of such
expenses are to be paid by the Registrant.
<TABLE>
<S> <C>
SEC registration fee............................................. $ 68,966
NASD Listing Fee................................................. 20,500
New York Stock Exchange Listing Fee.............................. 7,500*
Legal fees and expenses.......................................... 10,000*
Accounting fees and expenses..................................... 10,000*
Fees and expenses of Transfer Agent.............................. 25,000*
Blue Sky qualification fees and expenses......................... 5,000*
Printing and engraving fees...................................... 10,000*
Miscellaneous.................................................... 3,034*
--------
Total.......................................................... $160,000
========
</TABLE>
- --------
* Estimated and subject to future contingencies.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Restated Certificate of Incorporation of the Registrant requires the
Registrant to indemnify its directors and officers to the fullest extent
permitted by Delaware General Corporation Law. In addition, the directors of
the Registrant are insured under officers' and directors' liability insurance
policies purchased by the Company. The directors, officers and employees of the
Registrant are also insured against fiduciary liabilities under the Employee
Retirement Income Security Act of 1974.
Any underwriting agreement or agency agreement with respect to an offering of
securities registered hereunder will provide for indemnification of the
Registrant and its officers and directors and the Selling Stockholder by the
underwriters or agents, as the case may be, against certain liabilities
including liabilities under the Securities Act of 1933.
ITEM 16. EXHIBITS
The Exhibit Index beginning on page E-1 is hereby incorporated by reference.
ITEM 17. UNDERTAKINGS
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement:
(i) To include any prospectus required by section 10(a)(3) of the
Securities Act of 1933 (the "Act");
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the Registration Statement. Notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the total
dollar value of securities offered would not exceed that which has
registered) and any deviation from the low or high end of the estimated
maximum offering range may be reflected in the form of prospectus filed
with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than a 20 percent change
in the maximum aggregate offering price set forth in the "Calculation
of Registration Fee" table in the effective registration statement;
II-1
<PAGE>
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the Registration Statement or
any material change to such information in the Registration Statement;
provided, however, that the undertakings set forth in paragraphs (i) and (ii)
above do not apply if the information required to be included in a post-
effective amendment by those paragraphs is contained in periodic reports filed
by the Registrant pursuant to Section 13 or Section 15(d) of the Securities
Exchange Act of 1934 that are incorporated by reference in the Registration
Statement.
(2) That, for the purposes of determining any liability under the Act,
each such post-effective amendment shall be deemed to be a new Registration
Statement relating to the securities offered therein, and the offering of
such securities at that time shall be deemed to be the initial bona fide
offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(b) That, for purposes of determining any liability under the Act, each
filing of the Registrant's annual report pursuant to Section 13(a) or Section
15(d) of the Securities Exchange Act of 1934 that is incorporated by reference
in the Registration Statement shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Registrant of expenses incurred
or paid by a director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the
matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Act and will be governed by the final
adjudication of such issue.
II-2
<PAGE>
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
HAS DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN THE CITY OF NEW YORK, STATE OF NEW
YORK, ON THE 11TH DAY OF DECEMBER, 1995.
Lehman Brothers Holdings Inc.
/s/ Michael R. Milversted
By___________________________________
Name: Michael R. Milversted
Title:Treasurer
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS REGISTRATION
STATEMENT HAS BEEN SIGNED BELOW BY THE FOLLOWING PERSONS IN THE CAPACITIES AND
ON THE DATES INDICATED.
SIGNATURES TITLE DATE
* Chief Executive December 11,
- ------------------------------------- Officer and, 1995
RICHARD S. FULD, JR. Chairman of the
Board of Directors
(principal
executive officer)
* Chief Operating December 11,
- ------------------------------------- Officer, President 1995
T. CHRISTOPHER PETTIT and Director
* Chief Financial December 11,
- ------------------------------------- Officer, (principal 1995
ROBERT MATZA financial officer)
* Controller December 11,
- ------------------------------------- (principal 1995
DAVID GOLDFARB accounting officer)
* Director December 11,
- ------------------------------------- 1995
ROGER S. BERLIND
* Director December 11,
- ------------------------------------- 1995
KATSUMI FUNAKI
* Director December 11,
- ------------------------------------- 1995
HENRY KAUFMAN
II-3
<PAGE>
SIGNATURES TITLE DATE
* Director December 11,
- ------------------------------------- 1995
JOHN D. MACOMBER
* Director December 11,
- ------------------------------------- 1995
DINA MERRILL
* Director December 11,
- ------------------------------------- 1995
MASATAKA SHIMASAKI
* Director December 11,
- ------------------------------------- 1995
MALCOLM WILSON
/s/ Michael R. Milversted
*By: ________________________________
Michael R. Milversted
Attorney-in-Fact
December 11, 1995
II-4
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
PAGE NUMBER
FILED HEREWITH (--) IN SEQUENTIAL
XHIBITE OR INCORPORATED BY NUMBERING
NUMBER DESCRIPTION REFERENCE TO SYSTEM
- ------- ----------- ------------------- -------------
<S> <C> <C> <C>
1 -- Form of Underwriting Agreement --
3(a) -- Restated Certificate of Exhibit 3.1 to Holdings'
Incorporation dated May 27, 1994 Transition Report on Form
10-K for the eleven months
ended November 30, 1994
3(b) -- By-Laws of the Corporation, --
amended as of October 24, 1995
5 -- Opinion and consent of Karen M. --
Muller, Esq.
12 -- Computation of ratio of earnings Exhibit 12(b) to Registra-
to combined fixed charges and tion Statement No. 33-62085
preferred dividends filed October 25, 1995
23(a) -- Consent of Karen M. Muller, Esq. --
(included in Exhibit 5)
23(b) -- Consent of Ernst & Young LLP, --
Independent Auditors
24 -- Power of Attorney --
</TABLE>
E-1
<PAGE>
EXHIBIT 1
Preferred Stock
LEHMAN BROTHERS HOLDINGS INC.
UNDERWRITING AGREEMENT
----------------------
New York, New York
Dated the date set forth
In Schedule I hereto
To the Representative(s)
named in Schedule I
hereto, of the Underwriters
named in Schedule II hereto
Ladies and Gentlemen:
American Express Travel Related Services Company, Inc., a New York company
(the "Selling Stockholder"), proposes to issue and sell to you and the other
underwriters named in Schedule II hereto (the "Underwriters"), for whom you are
acting as representatives (the "Representatives"), the number of shares
identified in Schedule I hereto (the "Firm Stock") of the Company's Cumulative
Voting Preferred Stock, $1.00 par value per share (the "Preferred Stock"), of
Lehman Brothers Holdings Inc., a Delaware corporation (the "Company"). In
addition, the Selling Stockholder proposes to grant to the Underwriters an
option to purchase up to an additional number of shares of the Preferred Stock
identified in Schedule I hereto on the terms and for the purposes set forth in
Section 3 (the "Option Stock"). The Firm Stock and the Option Stock, if
purchased, are hereinafter collectively called the "Stock". If the firm or
firms listed in Schedule II hereto include only the firm or firms listed in
Schedule I hereto, then the terms "Underwriters" and "Representatives" shall
each be deemed to refer to such firm or firms. This is to confirm the agreement
concerning the purchase of the Stock from the Selling Stockholder by the
Underwriters named in Schedule II hereto.
1. Representations and Warranties of the Company. The Company represents
and warrants to each Underwriter and the Selling Stockholder that:
(a) The Company meets the requirements for the use of Form S-3 under
the Securities Act of 1933, as amended (the "Securities Act"), and the
rules and regulations promulgated thereunder (the "Rules"), and has
carefully prepared and filed with the Securities and Exchange Commission
(the "Commission") a registration statement on Form S-3 (the file
<PAGE>
2
number of which is set forth in Schedule I hereto), which has become
effective, for the registration of the Stock under the Securities Act. The
registration statement, as amended at the date of this Agreement, meets the
requirements set forth in Rule 415(a)(1)(i) under the Securities Act and
complies in all other material respects with such rule. The Company
proposes to file with the Commission pursuant to Rule 424 under the
Securities Act ("Rule 424") a supplement to the form of prospectus included
in the registration statement relating to the offering of the Stock
contemplated thereby and the plan of distribution thereof and has
previously advised you of all further information (financial and other)
with respect to the Company to be set forth therein. The term
"Registration Statement" means the registration statement, as amended at
the date of this Agreement, including the exhibits thereto, financial
statements, and all documents incorporated therein by reference pursuant to
Item 12 of Form S-3 (the "Incorporated Documents"); such prospectus as then
amended, including the Incorporated Documents, is hereinafter referred to
as the "Basic Prospectus"; and such supplemented form of prospectus, in the
form in which it shall be filed with the Commission pursuant to Rule 424
(including the Basic Prospectus as so supplemented), is hereinafter called
the "Final Prospectus". Any preliminary form of the Basic Prospectus which
has heretofore been filed pursuant to Rule 424 is hereinafter called the
"Interim Prospectus". Any reference herein to the Registration Statement,
the Basic Prospectus, any Interim Prospectus or the Final Prospectus shall
be deemed to refer to and include the Incorporated Documents which were
filed under the Securities Exchange Act of 1934 (the "Exchange Act"), on or
before the date of this Agreement or the issue date of the Basic
Prospectus, any Interim Prospectus or the Final Prospectus, as the case may
be; and any reference herein to the terms "amend", "amendment" or
"supplement" with respect to the Registration Statement, the Basic
Prospectus, any Interim Prospectus or the Final Prospectus shall be deemed
to refer to and include the filing of any Incorporated Documents under the
Exchange Act after the date of this Agreement or the issue date of the
Basic Prospectus, any Interim Prospectus or the Final Prospectus, as the
case may be, and deemed to be incorporated therein by reference.
(b) As of the date hereof, when the Final Prospectus is first filed
with the Commission pursuant to Rule 424, when, before either Delivery Date
(hereinafter defined), any amendment to the Registration Statement becomes
effective, when, before either Delivery Date, any Incorporated Document is
filed with the Commission, when any supplement to the Final Prospectus is
filed with the Commission and at each Delivery Date, the Registration
Statement, the Final Prospectus and any such amendment or supplement will
comply in all material respects with the applicable requirements of
<PAGE>
3
the Securities Act and the Rules, and the Incorporated Documents will
comply in all material respects with the requirements of the Exchange Act
or the Securities Act, as applicable, and the rules and regulations adopted
by the Commission thereunder; on the date it became effective, the
Registration Statement did not, and, on the date that any post-effective
amendment to the Registration Statement becomes effective, the Registration
Statement as amended by such post-effective amendment did not or will not,
as the case may be, 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; on the date the Final Prospectus is
filed with the Commission pursuant to Rule 424 and on each Delivery Date,
the Final Prospectus, as it may be amended or supplemented, 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 are made, not misleading; and on said dates,
the Incorporated Documents will comply in all material respects with the
applicable provisions of the Exchange Act and rules and regulations of the
Commission thereunder, and, when read together with the Final Prospectus,
or the Final Prospectus as it may be then amended or supplemented, 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, in light of the circumstances under which they are made, not
misleading; provided that the foregoing representations and warranties in
this paragraph (b) shall not apply to statements or omissions made in
reliance upon and in conformity with written information furnished to the
Company by or through the Representatives on behalf of any Underwriter or
the Selling Stockholder specifically for use in connection with the
preparation of the Registration Statement or the Final Prospectus, as they
may be amended or supplemented.
(c) The Basic Prospectus and any Interim Prospectus, as of their
respective dates, complied in all material respects with the requirements
of the Securities Act and of the Rules and did not include any untrue
statement of a material fact or omit to state a material fact necessary in
order to make the statements therein, in the light of the circumstances
under which they were made, not misleading. The Commission has not issued
an order preventing or suspending the use of the Basic Prospectus, any
Interim Prospectus or the Final Prospectus.
(d) The nationally recognized firm of independent public accountants
whose report appears in the Company's most recent Annual Report on Form 10-
K, which is incorporated by reference in the Final Prospectus, are
<PAGE>
4
independent public accountants as required by the Securities Act and the
Rules.
(e) In the event that a report of a nationally recognized firm of
independent public accountants regarding historical financial information
with respect to any entity acquired by the Company is required to be
incorporated by reference in the Final Prospectus, such independent public
accountants were independent public accountants, as required by the
Securities Act and the Rules, during the period of their engagement to
examine the financial statements being reported on and at the date of their
report.
(f) The audited consolidated financial statements of the Company in
the Final Prospectus and the Registration Statement present fairly on a
consolidated basis the financial position, the results of operations,
changes in common stock and other stockholder's equity and cash flows of
the Company and its subsidiaries, as of the respective dates and for the
respective periods indicated, all in conformity with generally accepted
accounting principles applied on a consistent basis throughout the periods
involved. The unaudited consolidated financial statements of the Company,
if any, included in the Final Prospectus and the Registration Statement and
the related notes are true, complete and correct, subject to normally
recurring changes resulting from year-end audit adjustments, and have been
prepared in accordance with the instructions to Form 10-Q.
(g) Except as described in or contemplated by the Registration
Statement and the Final Prospectus, there has not been any material adverse
change in or any adverse development which materially affects the business,
properties, financial condition or results of the Company or the Company
and its subsidiaries taken as whole, from the dates as of which information
is given in the Registration Statement and Final Prospectus.
(h) The Stock conforms to the description thereof contained in the
Final Prospectus, has been duly and validly authorized and is validly
issued, fully paid and non-assessable.
(i) The Company does not have any subsidiaries having business or
properties that are material to the business and properties of the Company
and its subsidiaries taken as a whole with the exception of Lehman Brothers
Inc. ("Lehman") and the possible exception of Lehman Commercial Paper Inc.
(the "Named Subsidiaries"). Neither the Company nor any of the Named
Subsidiaries is in violation of its corporate charter or by-laws or in
default under any agreement, indenture or instrument, the effect of which
violation or default would be material to the Company and its subsidiaries
taken as a whole. The execution, delivery and
<PAGE>
5
performance of this Agreement will not constitute a breach of, result in
the creation or imposition of any material lien, charge or encumbrance upon
any of the assets of the Company or any of its subsidiaries pursuant to the
terms of, or constitute a default under, any material agreement, indenture
or instrument, or result in a violation of the corporate charter or by-laws
of the Company or any of its subsidiaries or any order, rule or regulation
of any court or governmental agency having jurisdiction over the Company,
any of the Named Subsidiaries or their property. Except as set forth in
the Final Prospectus or as required by the Securities Act, the Exchange Act
and applicable state securities laws, no consent, authorization or order
of, or filing or registration with, any court or governmental agency is
required for the execution, delivery and performance of this Agreement.
(j) The Company and each of the Named Subsidiaries have been duly
organized, are validly existing and in good standing under the laws of
their respective jurisdictions of incorporation, are duly qualified to do
business and in good standing as foreign corporations and are fully
registered as a broker-dealer, broker, dealer or investment advisor, as the
case may be, in each jurisdiction in which their respective ownership of
property or the conduct of their respective businesses requires such
qualification or registration and in which the failure to qualify or
register would be reasonably likely, individually or in the aggregate, to
have a material adverse effect on the business, condition or properties of
the Company and its subsidiaries taken as a whole. Each of the Company and
its Named Subsidiaries holds all material licenses, permits, and
certificates from governmental authorities necessary for the conduct of its
business and owns, or possesses adequate rights to use, all material rights
necessary for the conduct of such business and has not received any notice
of conflict with the asserted rights of others in respect thereof; and each
of the Company and its Named Subsidiaries has the corporate power and
authority necessary to own or hold its properties and to conduct the
businesses in which it is engaged. Except as may be disclosed in the
Registration Statement and the Final Prospectus, all outstanding shares of
capital stock of the Named Subsidiaries are owned by the Company, directly
or indirectly through subsidiaries, free and clear of any lien, pledge and
encumbrance or any claim of any third party and are duly authorized,
validly issued and outstanding, fully paid and non-assessable.
(k) Except as described in the Registration Statement and the Final
Prospectus, there is no material litigation or governmental proceeding
pending or, to the knowledge of the Company, threatened against the Company
or any of its subsidiaries which might reasonably be expected to result in
any material adverse change in the business, properties,
<PAGE>
6
financial condition or results of operations of the Company and its
subsidiaries taken as a whole or which is required to be disclosed in the
Registration Statement and the Final Prospectus.
(l) The certificates delivered pursuant to paragraph (g) of Section 8
hereof and all other documents delivered by the Company or its
representatives in connection with the issuance and sale of the Stock were
on the dates on which they were delivered, or will be on the dates on which
they are to be delivered, in all material respects true and complete.
2. Representations and Warranties of the Selling Stockholder. The
Selling Stockholder represents and warrants to each Underwriter and the Company
that:
(a) The Selling Stockholder has, and immediately prior to each
Delivery Date (as defined in Section 4 hereof) the Selling Stockholder will
have, good and valid title to the shares of Stock to be sold by the Selling
Stockholder hereunder on such date, free and clear of all liens,
encumbrances, equities or claims (other than the interest of the
Underwriters referred to in Section 7(b)); and upon delivery of such shares
and payment therefor pursuant hereto, good and valid title to such shares,
free and clear of all liens, encumbrances, equities or claims, will pass to
the several Underwriters.
(b) The Selling Stockholder has full right, power and authority to
enter into this Agreement. The Selling Stockholder is not in violation of
its corporate charter or by-laws or in default under any agreement,
indenture or instrument, the effect of which violation or default would be
material to the Selling Stockholder. The execution, delivery and
performance of this Agreement will not constitute a breach of, result in
the creation or imposition of any material lien, charge or encumbrance upon
any of the assets of the Selling Stockholder pursuant to the terms of, or
constitute a default under, any material agreement, indenture or
instrument, or result in a violation of the corporate charter or by-laws of
the Selling Stockholder or any order, rule or regulation of any court or
governmental agency having jurisdiction over the Selling Stockholder or its
property. Except as set forth in the Final Prospectus or as required by
the Securities Act, the Exchange Act and applicable state securities laws,
no consent, authorization or order of, or filing or registration with, any
court or governmental agency is required for the execution, delivery and
performance by the Selling Stockholder of this Agreement.
(c) To the extent, but only to the extent, that any statements or
omissions made in the Registration Statement,
<PAGE>
7
any post-effective amendment thereto, the Final Prospectus or any amendment
or supplement thereto are made in reliance upon and in conformity with
written information furnished to the Company by the Selling Stockholder
specifically for use therein, on the date it became effective, the
Registration Statement did not, and, on the date that any post-effective
amendment to the Registration Statement becomes effective, the Registration
Statement as amended by such post-effective amendment did not or will not,
as the case may be, 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; on the date the Final Prospectus is
filed with the Commission pursuant to Rule 424 and on each Delivery Date,
the Final Prospectus, as it may be amended or supplemented, 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 are made, not misleading.
(d) To the extent, but only to the extent, that any statements or
omissions made in the Basic Prospectus or any Interim Prospectus are made
in reliance upon and conformity with written information furnished to the
Company by the Selling Stockholders specifically for use therein, the Basic
Prospectus and any Interim Prospectus, as of their respective dates, did
not include any untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading.
(e) The Selling Stockholder has not taken and will not take, directly
or indirectly, any action which is designed to or which has constituted or
which might reasonably be expected to cause or result in the stabilization
or manipulation of the price of any security of the Company to facilitate
the sale or resale of the shares of the Stock.
3. Sale and Purchase of the Stock. On the basis of the
representations, warranties and agreements herein contained, but subject to the
terms and conditions herein stated, the Selling Stockholder agrees to sell to
each Underwriter, and each Underwriter agrees to purchase from the Selling
Stockholder, the number of shares of Firm Stock set forth opposite the name of
such Underwriter in Schedule II hereto. The obligations of the Underwriters
under this Agreement are several and not joint.
In addition, the Selling Stockholder grants to the Underwriters an
option to purchase up to an additional number of shares of Option Stock
indicated in Schedule I hereto. Such option is granted solely for the purpose of
covering over-allotments in the sale of Firm Stock and is exercisable as
provided in Section 4 hereof. Shares of Option Stock shall be purchased
severally for the account of the Underwriters in
<PAGE>
8
proportion to the number of shares of Firm Stock set forth opposite the name of
such Underwriters in Schedule II hereto. The respective purchase obligations of
each Underwriter with respect to the Option Stock shall be adjusted by the
Representatives so that no Underwriter shall be obligated to purchase Option
Stock other than in 100 share amounts. The price of both the Firm Stock and any
Option Stock shall be the price per share indicated in Schedule I hereto.
4. Delivery and Payment. Delivery by the Selling Stockholder of the
Firm Stock to the Representatives for the respective accounts of the several
Underwriters and payment by the Underwriters therefor by certified or official
bank check or checks payable in, or by wire transfer of, immediately available
funds to or upon the order of the Selling Stockholder shall take place at the
office, on the date and at the time specified in Schedule I hereto, which date
and time may be postponed by agreement between the Representatives, the Company
and the Selling Stockholder or as provided in Section 12 hereof (such date and
time of delivery and payment for the Firm Stock being herein called the "First
Delivery Date").
The Firm Stock will be registered in such names and in such authorized
denominations as the Representatives may request no less than two full business
days in advance of the First Delivery Date. The Selling Stockholder and the
Company agree to have the Firm Stock available for inspection, checking and
packaging by the Representatives at such place as is designated by the
Representatives, not later than 1:00 p.m., New York City time, on the business
day prior to the First Delivery Date.
At any time on or before the thirtieth day after the First Delivery
Date, the option granted in Section 3 may be exercised by written notice being
given to the Selling Stockholder by the Representatives. Such notice shall set
forth the aggregate number of shares of Option Stock as to which the option is
being exercised, the names in which the shares of Option Stock are to be
registered, the denominations in which the shares of Option Stock are to be
issued and the date and time, as determined by the Representatives, when the
shares of Option Stock are to be delivered; provided, however, that this date
and time shall not be earlier than the First Delivery Date nor earlier than the
second business day after the date on which the option shall have been exercised
nor later than the third business day after the date on which the option shall
have been exercised. The date and time the shares of Option Stock are delivered
are sometimes referred to as the "Second Delivery Date" and the First Delivery
Date and the Second Delivery Date are sometimes referred to as a "Delivery
Date".
Delivery by the Selling Stockholder of the Option Stock to the
Representatives for the respective accounts of the several Underwriters and
payment by the Underwriters therefor by certified or official bank check or
checks payable in, or by wire
<PAGE>
9
transfer of, New York Clearing House (next-day) funds to or upon the order of
the Selling Stockholder shall take place at the office and at the time specified
in Schedule I hereto, on the Second Delivery Date, which date and time may be
postponed by agreement between the Representatives, the Company and the Selling
Stockholder or as provided in Section 12 hereof.
The Option Stock will be registered in such names and in such
authorized denominations as the Representatives may request in the aforesaid
written notice. The Selling Stockholder and the Company agree to have the
Option Stock available for inspection, checking and packaging by the
Representatives at such place as is designated by the Representatives, not later
than 1:00 p.m., New York City time, on the business day prior to the Second
Delivery Date.
5. Offering by Underwriters. The Company hereby confirms that the
Underwriters and dealers have been authorized to distribute or cause to be
distributed any Interim Prospectus and are authorized to distribute the Final
Prospectus (as from time to time amended or supplemented if the Company
furnishes amendments or supplements thereto to the Underwriters). The
Representatives agree that, as soon as the Representatives believe the offering
of the Stock has been terminated, the Representatives will so advise the
Company.
6. Agreements of the Company. The Company agrees with the several
Underwriters and the Selling Stockholder that:
(a) The Company will cause the Final Prospectus to be filed with the
Commission pursuant to Rule 424 not later than 10:00 a.m., New York City
time, on the business day following the date of this Agreement and will
promptly advise the Representatives and the Selling Stockholder (A) when
the Final Prospectus shall have been filed with the Commission pursuant to
Rule 424, (B) when any amendment to the Registration Statement relating to
the Stock shall have become effective, (C) of any request by the Commission
for any amendment of the Registration Statement, the Final Prospectus, the
Basic Prospectus or any Interim Prospectus, or for any additional
information, (D) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or the
institution or threatening of any proceedings for that purpose and (E) of
the receipt by the Company of any notification with respect to the
suspension of the qualification of the Stock for sale in any jurisdiction
or the initiation or threatening of any proceeding for such purpose. After
the date of this Agreement and prior to the termination of the offering of
the Stock, the Company will not file any amendment of the Registration
Statement or amendment or supplement to the Final Prospectus (except an
amendment or supplement to the Final Prospectus that is deemed to be
incorporated by reference in the Final
<PAGE>
10
Prospectus pursuant to Item 12 of Form S-3) without the consent of the
Selling Stockholder and the Representatives and will use its best efforts
to prevent the issuance of any such stop order and, if issued, to obtain as
soon as possible the withdrawal thereof. Prior to receipt of the advice to
be given by the Selling Stockholder and the Representatives pursuant to
Section 5, the Company will not file any document that would be deemed to
be incorporated by reference in the Final Prospectus pursuant to Item 12 of
Form S-3 without delivering to the Selling Stockholder and the
Representatives a copy of the document proposed to be so filed, such
delivery to be made at least twenty-four hours prior to such filing, and
the Company will consult with the Selling Stockholder and the
Representatives as to any comments which the Selling Stockholder and the
Representatives make in a timely manner with respect to the document so
delivered.
(b) Subject to the last sentence of the immediately preceding
paragraph, if, at any time when a prospectus relating to the Stock is
required to be delivered under the Securities Act, any event occurs as a
result of which the Final Prospectus as then amended or supplemented would
include any untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading, or
if it shall be necessary at any time to amend or supplement the Final
Prospectus to comply with the Securities Act or the Rules, 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 and will use its best efforts to cause
any amendment of the Registration Statement containing an amended Final
Prospectus to be made effective as soon as possible.
(c) The Company will deliver to the Representatives and the Selling
Stockholder, without charge, (i) signed copies of the Registration
Statement relating to the Stock and of any amendments thereto (including
all exhibits filed with, or incorporated by reference in, any such
document) and (ii) as many conformed copies of the Registration Statement
and of any amendments thereto which shall become effective on or before the
First Delivery Date (excluding exhibits) as the Representatives or the
Selling Stockholder may reasonably request.
(d) During such period as a prospectus is required by law to be
delivered by an Underwriter or dealer, the Company will deliver, without
charge to the Representatives and to Underwriters and dealers, at such
office or offices as the Representatives may designate, as many copies of
the Basic
<PAGE>
11
Prospectus, any Interim Prospectus and the Final Prospectus as the
Representatives may reasonably request.
(e) The Company will make generally available to its security holders
and to the Representatives as soon as practicable an earnings statement
(which need not be audited) of the Company and its subsidiaries, covering a
period of at least 12 months beginning after the date the Final Prospectus
is filed with the Commission pursuant to Rule 424, which will satisfy the
provisions of Section 11(a) of the Securities Act.
(f) The Company will furnish such information, execute such
instruments and take such actions as may be required to qualify the Stock
for offering and sale under the laws of such jurisdictions as the Selling
Stockholder and the Representatives may designate and will maintain such
qualifications in effect so long as required for the distribution of the
Stock; provided, however, that the Company shall not be required to qualify
to do business in any jurisdiction where it is not now so qualified or to
take any action which would subject it to general or unlimited service of
process in any jurisdiction where it is not now so subject.
(g) So long as any Stock is outstanding, the Company will furnish or
cause to be furnished to the Representatives copies of all annual reports,
quarterly reports and current reports filed with the Commission on Forms
10-K, 10-Q and 8-K, respectively, or such other similar forms as may be
designated by the Commission.
(h) If the Company has applied for the listing of the Stock on the New
York Stock Exchange Inc. (the "NYSE"), it will use its best efforts to
cause such listing to be approved as soon as possible.
(i) For a period of 30 days from the date of this Agreement, without
the prior consent of the Representatives, the Company will not offer, sell,
contract to sell or otherwise dispose of any shares of preferred stock, or
sell or grant options, rights or warrants with respect to any shares of
preferred stock covered by the Registration Statement or any other
registration statement filed under the Securities Act.
(j) The Company will use its best efforts to do and perform all things
to be done and performed hereunder prior to each Delivery Date and to
satisfy all conditions precedent to the delivery of the Stock to be
purchased hereunder.
<PAGE>
12
7. Agreements of the Selling Stockholder. The Selling Stockholder
agrees with the several Underwriters and the Company that:
(a) For a period of 30 days from the date of this Agreement, without
the prior consent of the Representatives, the Selling Stockholder will not
offer, sell, contract to sell or otherwise dispose of any shares of the
Preferred Stock (other than pursuant hereto), or sell or grant options,
rights or warrants with respect to any shares of the Preferred Stock.
(b) The Stock to be sold by the Selling Stockholder hereunder is
subject to the interest of the Underwriters and the obligations of the
Selling Stockholder hereunder shall not be terminated by any act of the
Selling Stockholder, by operation of law or the occurrence of any other
event not contemplated by this Agreement.
(c) To deliver to the Representatives prior to the First Delivery Date
a properly completed and executed United States Treasury Department Form W-
9 (or any successor form).
8. Conditions to the Obligations of the Underwriters. The
obligations of the Underwriters to purchase the Stock shall be subject to the
accuracy in all material respects of the representations and warranties on the
part of the Company and the Selling Stockholder contained herein as of the date
hereof and each Delivery Date, to the accuracy of any material statements made
in any certificates, opinions, affidavits, written statements or letters
furnished to the Representatives or to Simpson Thacher & Bartlett
("Underwriters' Counsel") pursuant to this Section 8, to the performance by the
Company and the Selling Stockholder of its respective obligations hereunder and
to the following additional conditions:
(a) The Final Prospectus shall have been filed with the Commission
pursuant to Rule 424 not later than 10:00 a.m., New York City time, on the
business day following the date of this Agreement or such later date and
time as shall be consented to in writing by the Representatives.
(b) No order suspending the effectiveness of the Registration
Statement, as amended from time to time, shall be in effect and no
proceedings for such purpose shall be pending before or threatened by the
Commission and any requests for additional information on the part of the
Commission (to be included in the Registration Statement or the Final
Prospectus or otherwise) shall have been complied with to the reasonable
satisfaction of the Representatives.
(c) Since the respective dates as of which information is given in the
Registration Statement and the Final Prospectus, there shall not have been
any change or decrease
<PAGE>
13
specified in the letter or letters referred to in paragraphs (i) or (j) of
this Section 8 which, in the judgment of the Representatives, makes it
impracticable or inadvisable to proceed with the offering and delivery of
the Stock as contemplated by the Registration Statement and the Final
Prospectus.
(d) The Company shall have furnished to the Representatives the
opinion of a Deputy General Counsel or the Chief Legal Officer for the
Company, dated the day of each Delivery Date to the effect that:
(i) The Company has been duly organized and is validly existing
and in good standing under the laws of the jurisdiction of its
incorporation with all requisite corporate power and authority to own
and operate its properties and to conduct its business as described in
the Final Prospectus.
(ii) The Stock conforms in all material respects to the
descriptions thereof contained in the Final Prospectus.
(iii) The Company has an authorized capitalization as set forth in
the Final Prospectus, and all of the issued shares of capital stock of
the Company (including the shares of Stock being delivered on such
Delivery Date) have been duly and validly authorized and issued, are
fully paid and non-assessable and conform to the description thereof
contained in the Prospectus;
(iv) There are no restrictions upon the voting or transfer of,
any shares of the Stock pursuant to the Company's charter or by-laws
or any agreement or other instrument known to such counsel;
(v) No consent, approval, authorization or order of any
court or governmental agency or body is required to be obtained by the
Company for the consummation of the transactions contemplated in this
Agreement, except for such consents, approvals, authorizations or
orders as have been obtained under the Securities Act and such as may
be required under the Exchange Act and the blue sky laws of any
jurisdiction in connection with the purchase and distribution of the
Stock by the Underwriters.
(vi) Such counsel does not know of any contracts or other
documents which are required to be filed as exhibits to the
Registration Statement by the Securities Act or by the Rules which
have not been filed as exhibits to the Registration Statement or
<PAGE>
14
incorporated therein by reference as permitted by the Rules.
(vii) To the best of such counsel's knowledge, neither the Company
nor any of its Named Subsidiaries is in violation of its corporate
charter or by-laws, or in default under any material agreement,
indenture or instrument known to such counsel, the effect of which
violation or default would be material to the Company and its
subsidiaries taken as a whole.
(viii) This Agreement has been duly authorized, executed and
delivered by the Company; the execution, delivery and performance of
this Agreement by the Company will not constitute a breach of, or
result in the creation or imposition of any material lien, charge or
encumbrance upon any of the assets of the Company or any of its Named
Subsidiaries pursuant to the terms of, or constitute a default under,
any material agreement, indenture or instrument known to such counsel
and to which the Company or any of its Named Subsidiaries is a party
or is bound, or result in a violation of the corporate charter or by-
laws of the Company or any of its Named Subsidiaries or any order,
rule or regulation known to such counsel of any court or governmental
agency having jurisdiction over the Company, any of its Named
Subsidiaries or any of their respective properties, the effect of
which would be material to the Company and its subsidiaries taken as a
whole.
(ix) The Registration Statement has become effective under the
Securities Act, and, to the best of the knowledge of such counsel, no
stop order suspending the effectiveness of the Registration Statement
has been issued and no proceeding for that purpose is pending or
threatened by the Commission.
(x) The Registration Statement, the Final Prospectus and each
amendment thereof or supplement thereto (except that no opinion need
be expressed as to the financial statements or other financial or
statistical data included or incorporated by reference therein) comply
as to form in all material respects with the requirements of the
Securities Act and the Rules.
(xi) If the Stock is to be listed on the NYSE, authorization
therefor has been given, subject to official notice of issuance and
evidence of satisfactory distribution, or the Company has filed a
preliminary listing application and all required supporting documents
with respect to the Stock with the NYSE, and such counsel has no
reason to believe that the Stock will not be authorized for listing,
subject
<PAGE>
15
to official notice of issuance and evidence of satisfactory
distribution.
(xii) Each of the Named Subsidiaries is a duly organized and
validly existing corporation in good standing under the laws of the
jurisdiction of its incorporation with all requisite corporate power
and authority to own and operate its properties and to conduct its
business as described in the Final Prospectus. Each of the Company
and its Named Subsidiaries is duly qualified to do business as a
foreign corporation, is in good standing and is duly registered as a
broker-dealer, broker, dealer or investment advisor, as the case may
be, in each jurisdiction in which the nature of the business conducted
by it or in which the ownership or holding by lease of the properties
owned or held by it require such qualification or registration and
where the failure to so qualify or register would have a material
adverse effect on the Company and its subsidiaries taken as a whole.
(xiii) All the outstanding shares of capital stock of each of
the Company's Named Subsidiaries have been duly and validly authorized
and issued and are fully paid and non-assessable and, except for
directors' qualifying shares, are owned by the Company or a subsidiary
of the Company free and clear of any claims, liens, encumbrances and
security interests.
(xiv) Such counsel does not know of any litigation or any
governmental proceeding pending or threatened against the Company or
any of its subsidiaries which would affect the subject matter of this
Agreement or is required to be disclosed in the Final Prospectus which
is not disclosed and correctly summarized therein.
Such opinion shall also contain a statement that although such counsel
is not passing upon and does not assume any responsibility for the
accuracy, completeness or fairness of the statements contained in the
Registration Statement and the Final Prospectus (except as to those matters
stated in paragraph (ii) of such opinion), such counsel has no reason to
believe that (i) the Registration Statement, as of its effective date,
contained any untrue statement of a material fact or omitted to state any
material fact required to be stated therein or necessary in order to make
the statements therein not misleading or (ii) the Final Prospectus contains
any untrue statement of a material fact or omits to state any material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading (except that no
opinion need be expressed as to the
<PAGE>
16
financial statements or other financial or statistical data included or
incorporated by reference therein).
In rendering such opinion, such counsel may rely upon opinions of
local counsel satisfactory to the Representatives for matters not governed
by New York law and may rely as to matters of fact, to the extent such
counsel deems proper, upon certificates or affidavits of officers of the
Company and public officials.
(e) Louise M. Parent, Esq. or other counsel reasonably acceptable to
the Representatives, shall have furnished to the Representatives her
written opinion, as counsel to the Selling Stockholder, addressed to the
Underwriters and dated the day of such Delivery Date, in form and substance
satisfactory to the Representatives, to the effect that:
(i) This Agreement has been duly authorized, executed and
delivered by the Selling Stockholder; the Selling Stockholder is the
sole and registered owner of the Stock; the Selling Stockholder has
full right, power and authority to enter into this Agreement and to
sell, assign, transfer and deliver the Stock pursuant to this
Agreement; the execution, delivery and performance of this Agreement
by the Selling Stockholder will not constitute a breach of, or result
in the creation or imposition of any material lien, charge or
encumbrance upon any of the assets of the Selling Stockholder pursuant
to the terms of, or constitute a default under, any material
agreement, indenture or instrument known to such counsel and to which
the Selling Stockholder is a party or is bound, or result in a
violation of the corporate charter or by-laws of the Selling
Stockholder or any order, rule or regulation known to such counsel of
any court or governmental agency having jurisdiction over the Selling
Stockholder or any of its respective properties, the effect of any of
which would be material to the Selling Stockholder.
(ii) No consent, approval, authorization or order of any court
or governmental agency or body is required to be obtained by the
Selling Stockholder for the consummation of the transactions
contemplated in this Agreement, except for such registrations,
consents, approvals, authorizations or orders as have been obtained
under the Securities Act and such as may be required under the
Exchange Act and the blue sky or securities laws of any applicable
jurisdiction in connection with the purchase and distribution of the
Stock by the Underwriters.
<PAGE>
17
(iii) Upon payment for, and delivery of, the shares of Stock to
be sold by the Selling Stockholder under this Agreement in accordance
with the terms hereof, the Underwriters will acquire all of the rights
of the Selling Stockholder in such shares and will also acquire the
interest of the Selling Stockholder in such shares free of any adverse
claim (within the meaning of the Uniform Commercial Code as in effect
in the State of New York).
Such opinion shall also contain a statement that although such counsel
is not passing upon and does not assume any responsibility for the
accuracy, completeness or fairness of the statements contained in the
Registration Statement and the Final Prospectus, such counsel has no reason
to believe that (i) the Registration Statement, as of its effective date,
contained any untrue statement of a material fact with respect to the
Selling Stockholder or omitted to state a material fact with respect to the
Selling Stockholder required to be stated therein or necessary in order to
make the statements therein with respect to the Selling Stockholder not
misleading or (ii) the Final Prospectus contains any untrue statement of a
material fact with respect to the Selling Stockholder or omits to state a
material fact with respect to the Selling Stockholder necessary in order to
make the statements therein with respect to the Selling Stockholder, in the
light of the circumstances under which they were made, not misleading.
In rendering such opinion, such counsel may (i) state that her opinion
is limited to matters governed by the federal law of the United States and
the laws of the State of New York, (ii) rely as to matters of fact, to the
extent such counsel deems proper, upon certificates or affidavits of
officers of the Selling Stockholder and public officials and (iii) with
respect to the opinion set forth in paragraph (iii) above, assume that the
Underwriters will purchase the Stock for value in good faith and without
notice of any adverse claim within the meaning of Section 8-302 of the
Uniform Commercial Code as in effect in the State of New York.
(f) The Representatives shall have received from Underwriters' Counsel
such opinion or opinions, dated the day of such Delivery Date, with respect
to the issuance and sale of the Stock, the Registration Statement, the
Final Prospectus and other related matters as the Representatives may
reasonably require, and the Company shall have furnished to such counsel
such documents as they request for the purpose of enabling them to pass
upon such matters.
(g) The Company shall have furnished to the Representatives a
certificate of its Chief Executive Officer, its President or any Managing
Director or Executive
<PAGE>
18
Vice President or Vice President and its Chief Financial Officer or its
Treasurer, dated the day of each Delivery Date, to the effect that, to the
best of their knowledge after due inquiry:
(i) The representations and warranties of the Company in this
Agreement are true and correct in all material respects on and as of
such Delivery Date with the same effect as if made on such Delivery
Date, and the Company has complied with all the agreements and
satisfied all the conditions on its part to be performed or satisfied
at or prior to such Delivery Date.
(ii) No stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that
purpose have been instituted or threatened.
(iii) (x) The Registration Statement does not contain any untrue
statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements
therein not misleading, (y) the Final Prospectus does not contain any
untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading, and (z) since the effective date of the
Registration Statement there has not occurred any event required to be
set forth in an amended or supplemented prospectus which has not been
so set forth.
(h) The Selling Stockholder shall have furnished to the
Representatives a certificate of its President or any Vice President, dated
the day of each Delivery Date, to the effect that, to the best of his
knowledge after due inquiry: (i) the representations and warranties of the
Selling Stockholder in this Agreement are true and correct in all material
respects on and as of such Delivery Date with the same effect as if made on
such Delivery Date, (ii) the Selling Stockholder has complied with all the
agreements and satisfied all the conditions on its part to be performed or
satisfied at or prior to such Delivery Date and (iii) (x) the Registration
Statement does not contain any untrue statement of a material fact with
respect to the Selling Stockholder or omit to state any material fact with
respect to the Selling Stockholder required to be stated therein or
necessary to make the statements therein with respect to the Selling
Stockholder not misleading, (y) the Final Prospectus does not contain any
untrue statement of a material fact with respect to the Selling Stockholder
or omit to state a material fact with respect to the Selling Stockholder
<PAGE>
19
required to be stated therein or necessary in order to make the statements
therein with respect to the Selling Stockholder, in the light of the
circumstances under which they were made, not misleading and (z) since the
effective date of the Registration Statement there has not occurred any
event with respect to the Selling Shareholder required to be set forth in
an amended or supplemented prospectus which has not been so set forth.
(i) At the time this Agreement is executed, a nationally recognized
firm of independent public accountants shall have furnished to the
Representatives a letter, dated the date of this Agreement, in form and
substance satisfactory to the Representatives, confirming that they are
independent auditors with respect to the Company within the meaning of the
Securities Act and the Rules and stating in effect that:
(i) In their opinion, the consolidated financial statements of
the Company and its subsidiaries, and the supporting schedules,
included in the Registration Statement and the Final Prospectus and
audited by them comply as to form in all material respects with the
applicable accounting requirements of the Securities Act and the
Exchange Act and the related published rules and regulations
thereunder.
(ii) On the basis of a reading of the unaudited consolidated
financial statements of the Company and its subsidiaries, if any,
included in the Registration Statement and the Final Prospectus,
carrying out certain specified procedures (but not an audit in
accordance with generally accepted auditing standards), a reading of
the minutes of the meetings of the directors of the Company and Lehman
and inquiries of certain officials of the Company and its subsidiaries
who have responsibility for financial and accounting matters of the
Company and its subsidiaries, as to transactions and events subsequent
to the date of the most recent audited consolidated financial
statements included in the Registration Statement and the Final
Prospectus, nothing came to their attention that caused them to
believe that any material modifications should be made to the
unaudited consolidated financial statements of the Company and its
subsidiaries, if any, included in the Registration Statement and the
Final Prospectus for them to be in conformity with generally accepted
accounting principles; and such financial statements do not comply as
to form in all material respects with the applicable accounting
requirements of the Securities Act and the related published rules and
regulations.
<PAGE>
20
(iii) If pro forma financial statements are included in the
Registration Statement or the Final Prospectus, (x) they have read
such pro forma financial statements, (y) they have made inquiries of
certain officials of the Company who have responsibility for financial
and accounting matters of the Company as to the basis for their
determination of the pro forma adjustments and whether such pro forma
financial statements comply as to form in all material respects with
the applicable accounting requirements of Rule 11-02 of Regulation S-X
and (z) they have proved the arithmetic accuracy of the application of
the pro forma adjustments to historical amounts; and as a result
thereof, nothing came to their attention that caused them to believe
that such pro forma financial statements do not so comply with Rule
11-02 of Regulation S-X and that such pro forma adjustments have not
been properly applied to the historical amounts in the compilation of
those statements.
(iv) They have performed certain other specified procedures as a
result of which they determined that certain information of an
accounting, financial or statistical nature (which is expressed in
dollars, or percentages derived from dollar amounts, and has been
obtained from the general accounting records of the Company) set forth
in the Registration Statement, as amended, and the Final Prospectus,
as amended or supplemented, and in Exhibit 12 to the Registration
Statement, including specified information, if any, included or
incorporated from the Company's Annual Report on Form 10-K
incorporated therein or specified information, if any, included or
incorporated from any of the Company's Quarterly Reports on Form 10-Q
or its Current Reports on Form 8-K incorporated therein, agrees with
the accounting records of the Company and its subsidiaries or
computations made therefrom, excluding any questions of legal
interpretation.
The letter required by this paragraph (i) may refer to a prior letter
of such nationally recognized firm of independent public accountants,
addressed to the Company, covering the above items (a "Prior Letter"). For
the purposes of the letter required by this paragraph (i), such nationally
recognized firm of independent public accountants need not perform any
procedures subsequent to the date of the Prior Letter.
(j) At each Delivery Date, the nationally recognized firm of
independent public accountants referred to in paragraph (i) of this Section
8 shall have furnished to the Representatives a letter, dated the day of
such Delivery Date, in form and substance satisfactory to the
Representatives, which reconfirms the matters set forth in
<PAGE>
21
their letter delivered pursuant to paragraph (i) of this Section 8 and
states in effect that:
(i) In their opinion, any consolidated financial statements of
the Company and its subsidiaries, and the supporting schedules,
included in the Registration Statement and the Final Prospectus and
audited by them and not covered by their letter delivered pursuant to
paragraph (i) of this Section 8 comply as to form in all material
respects with the applicable accounting requirements of the Securities
Act and the Exchange Act and the related published rules and
regulations thereunder.
(ii) On the basis of a reading of the unaudited consolidated
financial statements of the Company and its subsidiaries, if any,
included in the Registration Statement and the Final Prospectus and of
the latest unaudited consolidated financial statements made available
by the Company and Lehman, carrying out certain specified procedures
(but not an audit in accordance with generally accepted auditing
standards), a reading of the minutes of the meetings of the directors
of the Company, and inquiries of certain officials of the Company and
its subsidiaries, who have responsibility for financial and accounting
matters of the Company and its subsidiaries, as to transactions and
events subsequent to the date of the most recent audited consolidated
financial statements included in the Registration Statement and the
Final Prospectus, nothing came to their attention that caused them to
believe that:
(A) any material modifications should be made to the
unaudited consolidated financial statements of the Company and
its subsidiaries, if any, included in the Registration Statement
and the Final Prospectus and not covered by their letter
delivered pursuant to paragraph (i) of this Section 8, for them
to be in conformity with generally accepted accounting
principles; and such financial statements do not comply as to
form in all material respects with the applicable accounting
requirements of the Securities Act and the published
instructions, rules and regulations thereunder.
(B) the unaudited capsule information of the Company and its
subsidiaries, if any, included in the Registration Statement and
the Final Prospectus does not agree with the amounts set forth in
the unaudited consolidated financial statements of the Company
from which it was derived or was not determined on a basis
<PAGE>
22
substantially consistent with that of the corresponding financial
information in the latest audited financial statements of the
Company included in the Registration Statement and the Final
Prospectus.
(C)(I) as of the latest date as of which the Company and its
subsidiaries have monthly financial statements, there was any
decrease in the capital stock or additional paid-in capital, or
increase in long-term indebtedness of the Company and its
subsidiaries, or any increase in the accumulated deficit, as
compared with the amounts shown in the most recent consolidated
statement of financial condition of the Company and its
subsidiaries included in the Registration Statement and the Final
Prospectus, (II) with respect to the period subsequent to the
date of the most recent financial statements included in the
Registration Statement and the Final Prospectus and extending
through the latest date as of which the Company and its
subsidiaries have monthly financial statements, there was a
consolidated net loss or (III) with respect to the amounts of net
capital or excess net capital of Lehman determined pursuant to
Commission Rule 15c3-1 and shown in the most recent financial
statement of Lehman filed pursuant to Commission Rule 17a-5,
there has been any decrease in such amounts as compared with the
amounts shown in the most recent consolidated financial
statements included in the Registration Statement and the Final
Prospectus;
(D) as of a specified date not more than five business days
prior to the date of the letter, (I) there was any decrease in
the capital stock or additional paid-in capital, or increase in
long-term indebtedness of the Company and its subsidiaries as
compared with the amounts shown in the most recent consolidated
statement of financial condition of the Company and its
subsidiaries included in the Registration Statement and the Final
Prospectus or (II) there was any decrease in the estimated
amounts of net capital or excess net capital of Lehman determined
pursuant to Commission Rule 15c3-1, as compared with the amounts
shown on the most recent financial statement of Lehman filed
pursuant to Commission Rule 17a-5, such that Lehman did not
satisfy the requirements of Section 5 of Schedule E to Article
III of the By-Laws of the National Association of Securities
Dealers, Inc., which permit releases of proceeds from escrow;
<PAGE>
23
except in all instances for 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.
(iii) If pro forma financial statements are included in the
Registration Statement or the Final Prospectus and are not covered by
their letter delivered pursuant to paragraph (i) of this Section 8,
(x) they have read such pro forma financial statements, (y) they have
made inquiries of certain officials of the Company who have
responsibility for financial and accounting matters of the Company as
to the basis for their determination of the pro forma adjustments and
whether such pro forma financial statements comply as to form in all
material respects with the applicable accounting requirements of Rule
11-02 of Regulation S-X and (z) they have proved the arithmetic
accuracy of the application of the pro forma adjustments to the
historical amounts; and as a result thereof, nothing came to their
attention that caused them to believe that such pro forma financial
statements do not so comply with Rule 11-02 of Regulation S-X and that
such pro forma adjustments have not been properly applied to the
historical amounts in the compilation of those statements.
(iv) To the extent not covered by their letter delivered
pursuant to paragraph (i) of this Section 8, they have performed
certain other specified procedures as a result of which they
determined that certain information of an accounting, financial or
statistical nature (which is expressed in dollars, or percentages
derived from dollar amounts, and has been obtained from the general
accounting records of the Company) set forth in the Registration
Statement, as amended, and the Final Prospectus, as amended or
supplemented, and in Exhibit 12 to the Registration Statement,
including specified information, if any, included or incorporated from
the Company's Annual Report on Form 10-K incorporated therein or
specified information, if any, included or incorporated from any of
the Company's Quarterly Reports on Form 10-Q or its Current Reports on
Form 8-K incorporated therein, agrees with the accounting records of
the Company and its subsidiaries or computations made therefrom,
excluding any questions of legal interpretation.
(k) So long as historical financial information with respect to any
entity acquired by the Company is required to be included in the
Registration Statement or the Final Prospectus, at each Delivery Date, a
nationally recognized firm of independent public accountants shall have
furnished
<PAGE>
24
to the Representatives a letter, dated the day of such Delivery Date, in
form and substance satisfactory to the Representatives, confirming that
they are, or were as of a stated time, independent public accountants
within the meaning of the Securities Act and the Rules and stating in
effect that:
(i) in their opinion the audited consolidated financial
statements of such entity acquired by the Company, and the supporting
schedules, included in the Registration Statement and Final Prospectus
and examined by them, comply as to form in all material respects with
the applicable accounting requirements of the Securities Act and the
related published rules and regulations of the Commission thereunder;
and
(ii) they have performed certain other specified procedures as a
result of which they determined that certain historical financial
information relating to such entity acquired by the Company as
required to be reported pursuant to rules and regulations promulgated
under the Exchange Act agree with the accounting records of such
entity acquired by the Company or computations made therefrom,
excluding any questions of legal interpretation.
(l) Subsequent to the execution and delivery of this Agreement, (i) no
downgrading shall have occurred in the rating accorded the Company's debt
securities or preferred stock by any "nationally recognized statistical
rating organization," as that term is defined by the Commission for
purposes of Rule 436(g)(2) of the Rules and (ii) no such organization shall
have publicly announced that it has under surveillance or review, with
possible negative implications, its rating of any of the Company's debt
securities or preferred stock.
(m) Prior to each Delivery Date, the Company shall have furnished to
the Representatives such further information, certificates and documents as
the Representatives or Underwriters' Counsel may reasonably request.
If any of the conditions specified in this Section 8 shall not have
been fulfilled when and as required by this Agreement, or if any of the
certificates or opinions furnished to the Representatives or Underwriters'
Counsel pursuant to this Section 8 shall not be in all material respects
reasonably satisfactory in form and substance to the Representatives and to
Underwriters' Counsel, this Agreement and all obligations of the Underwriters
hereunder may be cancelled at, or at any time prior to, each Delivery Date by
the Representatives. Notice of such cancellation shall be given to the Company
and the Selling Stockholder in writing.
<PAGE>
25
9. Conditions to the Obligations of the Selling Stockholder. The
obligations of the Selling Stockholder to sell the Stock shall be subject to the
accuracy in all material respects of the representations and warranties on the
part of the Company contained herein as of the date hereof and each Delivery
Date, to the accuracy of any material statements made in any certificates,
opinions, affidavits, written statements or letters furnished to the Selling
Stockholder pursuant to this Section 9, to the performance by the Company of its
respective obligations hereunder, to the conditions set forth in Sections 8(a),
(b), (c) and (l) and to the following additional conditions:
(a) The Company shall have furnished to the Selling Stockholder an
opinion of the same tenor as the opinion delivered to the Representatives
pursuant to Section 8(d).
(b) The Company shall have furnished to the Selling Stockholder a
certificate of the same tenor as the certificate delivered to the
Representatives pursuant to Section 8(g).
(c) At the time this Agreement is executed and at each Delivery Date,
a nationally recognized firm of independent public accountants shall have
furnished to the Selling Stockholder letters of the same tenor as the
letters delivered to the Representatives pursuant to Sections 8(i), (j) and
(k), as applicable (provided, that the Selling Stockholder shall have
furnished to such accountants such certificates and opinions as such
accountants may request in connection with their delivery of such letter).
If any of the conditions specified in this Section 9 shall not have
been fulfilled when and as required by this Agreement, or if any of the
certificates or opinions furnished to the Selling Stockholder pursuant to this
Section 9 shall not be in all material respects reasonably satisfactory in form
and substance to the Selling Stockholder and to counsel for the Selling
Stockholder, this Agreement and all obligations of the Selling Stockholder
hereunder may be cancelled at, or at any time prior to, each Delivery Date by
the Selling Stockholder. Notice of such cancellation shall be given to the
Company and the Representatives in writing.
10. Expenses. (a) Whether or not the transactions contemplated in
this Agreement are consummated or this Agreement is terminated, the Company and
the Selling Stockholder will pay (in such proportion as shall be agreed between
them) all costs and expenses incident to the performance of the respective
obligations of the Company and the Selling Stockholder hereunder, including,
without limiting the generality of the foregoing, all costs, taxes and expenses
incident to the issuance, sale and delivery of the Stock to the Underwriters,
all fees and expenses of the Company's counsel and accountants, all fees and
expenses of the Selling Stockholder's Counsel, all costs and expenses
<PAGE>
26
incident to the preparing, printing and filing of the Registration Statement
(including all exhibits thereto), any Interim Prospectus, the Basic Prospectus,
the Final Prospectus and any amendments thereof or supplements thereto, and the
rating of the Stock by one or more rating agencies, all costs and expenses
(including fees of Underwriters' Counsel and their disbursements) incurred in
connection with blue sky qualifications, advising on the legality of the Stock
for investment, the filing requirements, if any, of the National Association of
Securities Dealers, Inc. in connection with its review of corporate financings,
the fee for listing the Stock on the NYSE and all costs and expenses of the
printing and distribution of all documents in connection with such offering.
Except as provided in this Section 10, neither the Company nor the Selling
Stockholder will have any responsibility to the Underwriters for the
Underwriters' own costs and expenses, including the fees of Underwriters'
Counsel and any advertising expenses in connection with any offer the
Underwriters may make.
(b) If the sale of the Stock provided for herein is not consummated
because any condition to the obligations of the Underwriters set forth in
Section 8 hereof is not satisfied or because of any refusal, inability or
failure on the part of the Company or the Selling Stockholder to perform any
agreement herein or comply with any provision hereof, the Company or the Selling
Stockholder, as the case may be, will, subject to demand by the Representatives,
reimburse the Underwriters for all out-of-pocket expenses (including reasonable
fees and disbursements of counsel) that shall have been incurred by them in
connection with the proposed purchase and sale of the Stock.
11. Indemnification. (a) The Company shall indemnify and hold
harmless each Underwriter, its directors, officers and employees, each person,
if any, who controls any Underwriter within the meaning of the Securities Act,
the Selling Stockholder, its directors, officers and employees and each person,
if any, who controls the Selling Stockholder within the meaning of the
Securities Act, from and against any loss, claim, damage or liability, joint or
several, or any action in respect thereof (including, but not limited to, any
loss, claim, damage, liability or action relating to purchases and sales of
Stock), to which any such indemnified party may become subject, under the
Securities Act, the Exchange Act or other federal or state statutory law or
regulation, at common law or otherwise, including any amount paid in settlement
of any litigation commenced or threatened, insofar as such loss, claim, damage,
liability or action arises out of, or is based upon, (i) any untrue statement or
alleged untrue statement of a material fact contained (A) in the Registration
Statement, as originally filed or in any amendment thereof, or in any Interim
Prospectus, the Basic Prospectus or the Final Prospectus, or in any amendment
thereof or supplement thereto, or (B) in any blue sky application or other
document prepared or executed by the Company (or based upon any written
information furnished by the Company)
<PAGE>
27
specifically for the purpose of qualifying any or all of the Stock under the
securities laws of any state or other jurisdiction (any such application,
document or information being hereinafter called a "Blue Sky Application"), (ii)
the omission or alleged omission to state in the Registration Statement, as
originally filed or in any amendment thereof, or in any Interim Prospectus, the
Basic Prospectus or the Final Prospectus, or in any amendment thereof or
supplement thereto, or in any Blue Sky Application any material fact required to
be stated therein or necessary to make the statements therein not misleading or
(iii) any violation or alleged violation by the Company of the Securities Act,
any blue sky laws, securities laws or other applicable laws of any state or
country in which the Stock is offered and relating to action or inaction
required of the Company in connection with such offering, and shall reimburse
each indemnified party promptly upon demand for any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending or preparing to defend against any such loss, claim, damage,
liability or action as such expenses are incurred; provided, however, that the
Company shall not be liable in any such case to the extent that any such loss,
claim, damage, liability or action arises out of, or is based upon, any untrue
statement or alleged untrue statement or omission or alleged omission made in
the Registration Statement, as originally filed or in any amendment thereof, or
in any Interim Prospectus, the Basic Prospectus or the Final Prospectus, or in
any amendment thereof or supplement thereto in reliance upon and in conformity
with the written information furnished to the Company through the
Representatives by or on behalf of any Underwriter specifically for inclusion
therein and described in Section 10(f) or written information furnished to the
Company by the Selling Stockholder specifically for inclusion therein and
described in Section 10(g); and provided, further, that as to the Basic
Prospectus or any Interim Prospectus this Section 11(a) shall not inure to the
benefit of any Underwriter, its directors, officers or employees or any person
controlling that Underwriter on account of any loss, claim, damage, liability or
action arising from the sale of Stock to any person by that Underwriter if that
Underwriter failed to send or give a copy of the Final Prospectus, as the same
may be amended or supplemented, to that person within the time required by the
Securities Act, and the untrue statement or alleged untrue statement of a
material fact or omission or alleged omission to state a material fact in the
Basic Prospectus or any Interim Prospectus, as the case may be, was corrected in
the Final Prospectus, unless such failure resulted from non-compliance by the
Company with Section 6(d). For purposes of the last proviso to the immediately
preceding sentence, the term "Final Prospectus" shall not be deemed to include
the documents incorporated therein by reference, and no Underwriter shall be
obligated to send or give any supplement or amendment to any document
incorporated by reference in the Basic Prospectus or any Interim Prospectus to
any person other than a person to whom such Underwriter had delivered such
incorporated document or documents in response to a written request therefor.
<PAGE>
28
The foregoing indemnity agreement is in addition to any liability which the
Company may otherwise have to any such indemnified party.
(b) The Selling Stockholder shall indemnify and hold harmless each
Underwriter, its directors, officers and employees, each person, if any, who
controls any Underwriter within the meaning of the Securities Act, the Company,
its directors, officers and employees and each person, if any, who controls the
Company within the meaning of the Securities Act, from and against any loss,
claim, damage or liability, joint or several, or any action in respect thereof
(including, but not limited to, any loss, claim, damage, liability or action
relating to purchases and sales of Stock), to which any such indemnified party
may become subject, under the Securities Act, the Exchange Act or other federal
or state statutory law or regulation, at common law or otherwise, including any
amount paid in settlement of any litigation commenced or threatened, insofar as
such loss, claim, damage, liability or action arises out of, or is based upon,
(i) any untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement, as originally filed or in any amendment
thereof, or in any Interim Prospectus, the Basic Prospectus or the Final
Prospectus, or in any amendment thereof or supplement thereto, (ii) the omission
or alleged omission to state in the Registration Statement, as originally filed
or in any amendment thereof, or in any Interim Prospectus, the Basic Prospectus
or the Final Prospectus, or in any amendment thereof or supplement thereto any
material fact required to be stated therein or necessary to make the statements
therein not misleading, but in the case of clauses (i) and (ii) only to the
extent that the untrue statement or alleged untrue statement or omission or
alleged omission was made in reliance upon and in conformity with the written
information furnished to the Company by or on behalf of the Selling Stockholder
specifically for inclusion therein and described in Section 11(g), or (iii) any
violation or alleged violation by the Selling Stockholder of the Securities Act,
any blue sky laws, securities laws or other applicable laws of any state or
country in which the Stock is offered and relating to action or inaction
required of the Selling Stockholder in connection with such offering, and shall
reimburse each indemnified party promptly upon demand for any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending or preparing to defend against any such loss, claim,
damage, liability or action as such expenses are incurred; provided, however,
that as to the Basic Prospectus or any Interim Prospectus this Section 11(b)
shall not inure to the benefit of any Underwriter, its directors, officers or
employees or any person controlling that Underwriter on account of any loss,
claim, damage, liability or action arising from the sale of Stock to any person
by that Underwriter if that Underwriter failed to send or give a copy of the
Final Prospectus, as the same may be amended or supplemented, to that person
within the time required by the Securities Act, and the untrue statement or
alleged untrue
<PAGE>
29
statement of a material fact or omission or alleged omission to state a material
fact in the Basic Prospectus or any Interim Prospectus, as the case may be, was
corrected in the Final Prospectus. If such failure resulted from non-compliance
by the Company with Section 6(d), the Company shall indemnify such Underwriter,
its directors, officers and employees and any person controlling such
Underwriter on account of any such loss, claim, damage, liability or action.
For purposes of the proviso to the second preceding sentence, the term "Final
Prospectus" shall not be deemed to include the documents incorporated therein by
reference, and no Underwriter shall be obligated to send or give any supplement
or amendment to any document incorporated by reference in the Basic Prospectus
or any Interim Prospectus to any person other than a person to whom such
Underwriter had delivered such incorporated document or documents in response to
a written request therefor. The foregoing indemnity agreement is in addition to
any liability which the Selling Stockholder may otherwise have to any such
indemnified party.
(c) Each Underwriter, severally and not jointly, shall indemnify and
hold harmless the Company, its directors, officers and employees, each person,
if any, who controls the Company within the meaning of the Securities Act, the
Selling Stockholder, its directors, officers and employees and each person, if
any, who controls the Selling Stockholder within the meaning of the Securities
Act from and against any loss, claim, damage or liability, joint or several, or
any action in respect thereof, to which any such indemnified party may become
subject, under the Securities Act, the Exchange Act or other federal or state
statutory law or regulation, at common law or otherwise, including any amount
paid in settlement of any litigation commenced or threatened, insofar as such
loss, claim, damage, liability or action arises out of, or is based upon, (i)
any untrue statement or alleged untrue statement of a material fact contained
(A) in the Registration Statement, as originally filed or in any amendment
thereof, or in any Interim Prospectus, the Basic Prospectus or the Final
Prospectus, or in any amendment thereof or supplement thereto, or (B) in any
Blue Sky Application or (ii) the omission or alleged omission to state in the
Registration Statement, as originally filed or in any amendment thereof, or in
any Interim Prospectus, the Basic Prospectus or the Final Prospectus, or in any
amendment thereof or supplement thereto any material fact required to be stated
therein or necessary to make the statements therein not misleading, but in the
case of clauses (i) and (ii) only to the extent that the untrue statement or
alleged untrue statement or omission or alleged omission was made in reliance
upon and in conformity with the written information furnished to the Company
through the Representatives by or on behalf of that Underwriter specifically for
inclusion therein and described in Section 11(f), and shall reimburse any such
indemnified party promptly upon demand for any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending or preparing to defend against any such loss, claim, damage,
liability of
<PAGE>
30
action as such expenses are incurred. The foregoing indemnity agreement is in
addition to any liability which any Underwriter may otherwise have to any such
indemnified party.
(d) Promptly after receipt by an indemnified party under this Section
11 of notice of any claim or the commencement of any action, the indemnified
party shall, if a claim in respect thereof is to be made against the
indemnifying party under this Section 11, notify the indemnifying party in
writing of the claim or the commencement of that action; provided, however, that
the failure to notify the indemnifying party shall not relieve it from any
liability which it may have under this Section 11 except to the extent it has
been materially prejudiced by such failure and, provided, further, that the
failure to notify the indemnifying party shall not relieve it from any liability
which it may have to an indemnified party otherwise than under this Section 11.
If any such claim or action shall be brought against an indemnified party, and
it shall notify the indemnifying party thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it wishes, jointly with
any other similar notified indemnifying party, to assume the defense thereof
with counsel reasonably satisfactory to the indemnified party. After notice
from the indemnifying party to the indemnified party of its election to assume
the defense of such claim or action, the indemnifying party shall not be liable
to the indemnified party under this Section 11 for any legal or other expenses
subsequently incurred by the indemnified party in connection with the defense
thereof other than reasonable costs of investigation; provided, however, that
any indemnified party shall have the right to employ separate counsel in any
such action and to participate in the defense thereof but the fees and expenses
of such counsel shall be at the expense of such indemnified party unless (i) the
employment thereof has been specifically authorized by the indemnifying party in
writing, (ii) such indemnified party shall have been advised by such counsel
that there may be one or more legal defenses available to it which are different
from or additional to those available to the indemnifying party and in the
reasonable judgment of such counsel it is advisable for such indemnified party
to employ separate counsel or (iii) the indemnifying party has failed to assume
the defense of such action and employ counsel reasonably satisfactory to the
indemnified party, in which case, if such indemnified party notifies the
indemnifying party in writing that it elects to employ separate counsel at the
expense of the indemnifying party, the indemnifying party shall not have the
right to assume the defense of such action on behalf of such indemnified party,
it being understood, however, that the indemnifying party shall not, in
connection with any one such action or separate but substantially similar or
related actions in the same jurisdiction arising out of the same general
allegations or circumstances, be liable for the reasonable fees and expenses of
more than one separate firm of attorneys at any time for all such indemnified
parties, which firm shall be designated in writing by the Representatives, if
the indemnified
<PAGE>
31
parties under this Section 11 consist of any Underwriter or any of their
respective officers, employees or controlling persons, or by the Company, if the
indemnified parties under this Section 11 consist of the Company or any of the
Company's directors, officers, employees or controlling persons or by the
Selling Stockholder, if the indemnified parties under this Section 11 consist of
the Company or any of the Selling Stockholder's directors, officers, employees
or controlling persons; provided, however, that the Underwriters and the Selling
Stockholder shall each have the right at the indemnifying party's expense to
employ separate counsel to represent them and their respective directors,
officers, employees and controlling persons who may be subject to liability
arising out of any claim in respect of which indemnity may be subject under this
Section 11 if, in the reasonable judgment of the Representatives or the Selling
Stockholder, as the case may be, it is advisable for the Underwriters or the
Selling Stockholder, as the case may be, and their respective directors,
officers, employees and controlling persons to be jointly represented by
separate counsel (it being understood, however, that the indemnifying party
shall not, in connection with any one such action or separate but substantially
similar or related actions in the same jurisdiction arising out of the same
general allegations or circumstances, be liable for the reasonable fees and
expenses of more than one separate firm of attorneys at any time for the
Underwriters or the Selling Stockholder, as the case may be, and their
respective directors, officers, employees and controlling persons, which firm
shall be designated in writing by the Representatives or the Selling
Stockholder, as the case may be). Each indemnified party, as a condition of the
indemnity agreements contained in Sections 11(a), 11(b) and 11(c), shall use its
best efforts to cooperate with the indemnifying party in the defense of any such
action or claim. No indemnifying party shall (i) without the prior written
consent of the indemnified parties (which consent shall not be unreasonably
withheld), settle or compromise or consent to the entry of any judgment with
respect to any pending or threatened claim, action, suit or proceeding in
respect of which indemnification or contribution may be sought hereunder
(whether or not the indemnified parties are actual or potential parties to such
claim or action) unless such settlement, compromise or consent includes an
unconditional release of each indemnified party from all liability arising out
of such claim, action, suit or proceeding, or (ii) be liable for any settlement
of any such action effected without its written consent (which consent shall not
be unreasonably withheld), but if settled with its written consent or if there
be a final judgment of the plaintiff in any such action, the indemnifying party
agrees to indemnify and hold harmless any indemnified party from and against any
loss of liability by reason of such settlement or judgment.
(e) If the indemnification provided for in this Section 11 shall for
any reason be unavailable to or insufficient to hold harmless an indemnified
party under Section 11(a), 11(b) or 11(c) in respect of any loss, claim, damage
or liability, or
<PAGE>
32
any action 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 loss, claim,
damage or liability, or action in respect thereof, in such proportion as shall
be appropriate to reflect the relative fault of the indemnifying party on the
one hand and the indemnified party or parties on the other with respect to the
statements or omissions which resulted in such loss, claim, damage or liability,
or action in respect thereof, as well as any other relevant equitable
considerations. The relative fault shall be determined by reference to whether
the untrue or alleged untrue statement of a material fact or omission or alleged
omission to state a material fact relates to information supplied by the
indemnifying party on the one hand or the indemnified party or parties on the
other hand, the intent of the parties and their relative knowledge, access to
information and opportunity to correct or prevent such statement or omission,
but not by reference to the Selling Stockholder's or any other indemnified
party's stock ownership in the Company. The Company, the Selling Stockholder
and the Underwriters agree that it would not be just and equitable if
contributions pursuant to this Section 11(e) were to be determined by pro rata
allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take into account
the equitable considerations referred to herein. The amount paid or payable by
an indemnified party as a result of the loss, claim, damage or liability, or
action in respect thereof, referred to above in this Section 11(e) shall be
deemed to include, for purposes of this Section 11(e), 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 Section 11(e), no Underwriter shall be required to contribute
any amount in excess of the amount by which the total price at which the Stock
underwritten by it and distributed to the public was offered to the public
exceeds the amount of any damages which such Underwriter has otherwise paid or
become liable to pay by reason of any untrue or alleged untrue statement or
omission or alleged omission. No person guilty of fraudulent misrepresentation
(within the meaning of Section 12(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations to contribute as provided in
this Section 11(e) are several in proportion to their respective underwriting
obligations and not joint.
(f) The Underwriters severally confirm that the statements with
respect to the public offering of the Stock set forth in the last paragraph on
the cover page of, and under the caption "Underwriting" in, the Final Prospectus
are correct and constitute the only information furnished in writing to the
Company by or on behalf of the Underwriters specifically for inclusion in the
Registration Statement and the Final Prospectus.
<PAGE>
33
(g) The Selling Stockholder confirms that the statements with respect
to the public offering of the Stock set forth under the caption "Selling
Stockholder" in the Final Prospectus are correct and constitute the only
information furnished in writing to the Company by or on behalf of the Selling
Stockholder specifically for inclusion in the Registration Statement and the
Final Prospectus.
12. Default by an Underwriter. If, on either Delivery Date, any one
or more Underwriters shall fail to purchase and pay for all of the Stock agreed
to be purchased by such Underwriter or Underwriters hereunder and such failure
to purchase shall constitute a default in the performance of its or their
obligations under this Agreement, the remaining Underwriters shall be obligated
severally to take up and pay for (in the respective proportions which the number
of shares of Firm Stock set forth opposite their names in Schedule II hereto
bear to the aggregate number of shares of Firm Stock set opposite the names of
the remaining Underwriters) the Stock which the defaulting Underwriter or
Underwriters agreed but failed to purchase on such Delivery Date; provided,
however, that in the event that the aggregate number of shares of Stock which
the defaulting Underwriter or Underwriters agreed but failed to purchase on such
Delivery Date shall exceed 10% of the aggregate number of shares of the Stock,
the remaining Underwriters shall have the right to purchase all, but shall not
be under any obligation to purchase any, of the Stock, and if such non-
defaulting Underwriters do not purchase all the Stock, this Agreement (or, with
respect to the Second Delivery Date, the obligation of the Underwriters to
purchase, and of the Selling Stockholder to sell, the Option Stock) will
terminate without liability to any non-defaulting Underwriters, the Company or
the Selling Stockholder. In the event of a default by any Underwriter as set
forth in this Section 12, the particular Delivery Date shall be postponed for
such period, not exceeding seven days, as the Representatives shall determine in
order that the required changes in the Registration Statement and the Final
Prospectus or in any other documents or arrangements may be effected. Nothing
herein contained shall relieve any defaulting Underwriter of its liability, if
any, to the Company, the Selling Stockholder and any non-defaulting Underwriter
for damages occasioned by its default hereunder.
13. Termination. This Agreement shall be subject to termination in
the absolute discretion of the Representatives, by notice given to the Company
and the Selling Stockholder at or prior to delivery of and payment for all the
Firm Stock, if, prior to such time (i) any of the events described in Section
8(l) shall have occurred, (ii)(x) the Company or any of its subsidiaries shall
have sustained since the date of the latest audited financial statements
included or incorporated by reference in the Final Prospectus any loss or
interference with its business from fire, explosion, flood or other calamity,
whether or not covered by insurance, or from any labor dispute or
<PAGE>
34
court or governmental action, order or decree, otherwise than as set forth or
contemplated in the Final Prospectus or (y) since such date there shall have
been any change in the capital stock, net capital or long-term debt of the
Company or any of its subsidiaries or any change, or any development involving a
prospective change, in or affecting the general affairs, management, financial
position, stockholders' equity or results of operations of the Company and its
subsidiaries, otherwise then as set forth or contemplated in the Final
Prospectus, the effect of which, in any such case described in clause (x) or
(y), is, in the judgment of the Representatives, so material and adverse as to
make it impractical or unadvisable to proceed with the public offering or
delivery of the Stock in the terms and in the manner contemplated in the Final
Prospectus, (iii) trading in securities generally on the NYSE or the American
Stock Exchange or in the over-the-counter market, or trading in any securities
of the Company on any exchange or in the over-the-counter market, shall have
been suspended or minimum prices shall have been established on any such
exchange or such market by the Commission, by such exchange or by any other
regulatory body or governmental authority having jurisdiction, (iv) a banking
moratorium shall have been declared by federal or state authorities, (v) the
United States becomes engaged in hostilities, there shall have been an
escalation in hostilities involving the United States or there shall have been a
declaration of a national emergency or war by the United States, (vi) there
shall have occurred such a material adverse change in general economic,
political or financial conditions (or the effect of international conditions on
the financial markets in the United States shall be such) as to make it, in the
judgment of the Representatives, impractical or inadvisable to proceed with the
public offering or delivery of the Stock on the terms and in the manner
contemplated in the Final Prospectus or (viii) the Underwriters shall decline to
purchase the Stock for any reason permitted under this Agreement.
14. Representations and Indemnities to Survive Delivery. The
respective agreements, representations, warranties, indemnities and other
statements of the Company or its officers (as such officers), the Selling
Stockholder or its officers (as such officers), and of the Underwriters set
forth in or made pursuant to this Agreement will remain in full force and effect
regardless of any investigation made by or on behalf of any Underwriter, the
Selling Stockholder or the Company or any of their respective officers or
directors or any controlling person within the meaning of the Securities Act, or
the Selling Stockholder, and will survive delivery of the payment for the Stock.
15. Notices. All communications hereunder will be in writing, and,
if sent to the Representatives will be mailed, delivered, telegraphed or telexed
and confirmed to them, at the address specified in Schedule I hereto; if sent to
the Company will be mailed, delivered, telegraphed or telexed and confirmed to
it at 3 World Financial Center, New York, New York 10285,
<PAGE>
35
Attention: Chief Financial Officer; or if sent to the Selling Stockholder will
be mailed, delivered, telegraphed or telexed and confirmed to it at World
Financial Center, American Express Tower, New York, New York 10285, Attention:
Chief Financial Officer.
16. Successors. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their successors and, to the extent and only
to the extent stated in Section 11 hereof, the officers and directors and
controlling persons referred to in Section 11 hereof, and except as provided in
Section 11 hereof, no person other than the parties hereto and their respective
successors will have any right or obligation hereunder.
17. Applicable Law. This Agreement will be governed by and construed
in accordance with the laws of the State of New York.
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicate hereof, whereupon
this letter and your acceptance shall represent a binding agreement among the
Company, the Selling Stockholder and the several Underwriters.
Very truly yours,
LEHMAN BROTHERS HOLDINGS INC.
By____________________________________
Title:
AMERICAN EXPRESS TRAVEL RELATED SERVICES
COMPANY, INC.
By____________________________________
Title:
<PAGE>
36
The foregoing Agreement is hereby confirmed
and accepted as of the date first above written.
LEHMAN BROTHERS INC.
By___________________________
Title:
Acting on behalf of the Representatives named
in Schedule I annexed hereto and the several
Underwriters named in Schedule II annexed hereto.
<PAGE>
SCHEDULE I
Date of Underwriting Agreement:
Registration Statement No. 33-
Representative and Address: Lehman Brothers Inc.
3 World Financial Center
New York, New York 10285
Description of Stock:
Title: Cumulative Voting Preferred Stock,
$1.00 par value per share
Number of shares
of Firm Stock: ____________ shares
Maximum number of shares
of Option Stock: ____________ shares
Price per share: $
Price to public:
Time of payment of
dividends: March 15, June 15, September 15 and December
15 of each year, when, as and if declared by
the Board of Directors or a duly authorized
committee thereof out of assets legally
available therefor
Sinking fund provisions: None
Redemption provisions: As set forth in the Final Prospectus
Repayment provisions: None
Other provisions: As set forth in the Final Prospectus
First Delivery Date, Time and Location:
Date:
Time:
Location:
<PAGE>
SCHEDULE II
NUMBER OF
SHARES OF
FIRM STOCK
TO BE
UNDERWRITERS PURCHASED
------------ -----------
Lehman Brothers Inc. .................................
Morgan Stanley & Co. Incorporated.....................
Total...........................................
<PAGE>
EXHIBIT 3B
Amended and Restated
By-Laws
Effective: October 24, 1995
LEHMAN BROTHERS HOLDINGS INC.
Incorporated Under the Laws of the
State of Delaware
BY-LAWS
-------
ARTICLE I
OFFICES
Lehman Brothers Holdings Inc. (the "Corporation") shall maintain a
registered office in the State of Delaware. The Corporation may also have other
offices at such places, either within or without the State of Delaware, as the
Board of Directors may from time to time designate or the business of the
Corporation may require.
ARTICLE II
STOCKHOLDERS
Section 1. Place of Meetings. Meetings of the stockholders for the
-----------------
election of directors or for any other purpose shall be held on such date, at
such time and at such place, either within or without the State of Delaware, as
shall be designated from time to time by the Board of Directors and stated in
the notice of the meeting or in a duly executed waiver of notice thereof.
Section 2. Annual Meeting. The Annual Meeting of Stockholders shall
---------------
be held on such date and at such time as shall be designated from time to time
by the Board of Directors and stated in the notice of the meeting, at which
meeting the stockholders shall elect by a plurality vote a Board of Directors
and transact only such other business as is properly brought before the meeting
in accordance with these By-Laws. Written notice of the Annual Meeting stating
the place, date and hour of the meeting shall be given as permitted by law to
each stockholder entitled to vote at such meeting not less than ten (10) nor
more than sixty (60) days before the date of the meeting.
Section 3. Special Meetings. Unless otherwise prescribed by law or
-----------------
the Restated Certificate of Incorporation (such Certificate, as amended from
time to time, including resolutions adopted from time to time by the Board of
Directors establishing the designation, rights, preferences and other terms of
any class or series of capital stock, the "Certificate of Incorporation"),
special meetings of the stockholders may be called only by the Chairman of the
Board, the Chief Executive Officer, the President in the absence or disability
of the Chairman of the Board and the Chief Executive Officer, or the Secretary
at the request
<PAGE>
of the Board of Directors. Written notice of a Special Meeting stating the
place, date and hour of the meeting and the purposes for which the meeting is
called shall be given not less than ten (10) nor more than sixty (60) days
before the date of the meeting to each stockholder entitled to vote at such
meeting. Only such business as is specified in the notice of special meeting
shall come before such meeting.
Section 4. Quorum. Except as otherwise provided by law or by the
------
Certificate of Incorporation, the holders of a majority of the shares of capital
stock issued and outstanding and entitled to vote thereat ("Voting Stock"),
present in person or represented by proxy, shall constitute a quorum at all
meetings of the stockholders for the transaction of business. If, however, such
quorum shall not be present or represented at a meeting of the stockholders, the
stockholders entitled to vote thereat, present or represented by proxy, shall
have the power to adjourn the meeting from time to time, without notice other
than announcement at the meeting, until a quorum shall be present or
represented. At such adjourned meeting at which a quorum shall be present or
represented, any business may be transacted which might have been transacted at
the meeting as originally noticed. If the adjournment is for more than thirty
(30) days, or if after the adjournment a new record date is fixed for the
adjourned meeting, a notice of the adjourned meeting shall be given to each
stockholder entitled to vote at the meeting. When a quorum is once present, it
is not broken by the subsequent withdrawal of any stockholder.
Section 5. Appointment of Inspectors of Election. The Board of
--------------------------------------
Directors shall, in advance of sending to the stockholders any notice of a
meeting of the holders of any class of shares, appoint one or more inspectors of
election ("inspectors") to act at such meeting or any adjournment or
postponement thereof and make a written report thereof. The Board of Directors
may designate one or more persons as alternate inspectors to replace any
inspector who fails to act. If no inspector or alternate is so appointed or if
no inspector or alternate is able to act, the Chairman of the Board shall
appoint one or more inspectors to act at such meeting. Each inspector, before
entering upon the discharge of such inspector's duties, shall take and sign an
oath faithfully to execute the duties of inspector with strict impartiality and
according to the best of such inspector's ability. The inspectors shall not be
directors, officers or employees of the Corporation.
Section 6. Voting. Except as otherwise provided by law or by the
------
Certificate of Incorporation, each stockholder of record of any class or series
of stock having a preference over the Common Stock of the Corporation as to
dividends or upon liquidation shall be entitled on each matter submitted to a
vote at each meeting of stockholders to such number of votes for each share of
such stock as may be fixed in the Certificate of Incorporation, and each
stockholder of record of Common Stock shall be entitled at each meeting of
stockholders to one vote for each share of such stock, in each case, registered
in such stockholder's name on the books of the Corporation on the date fixed
pursuant to Section 5 of Article VI of these By-Laws as the record date for the
determination of stockholders entitled to notice of and to vote at such meeting,
or if no such record date shall have been so fixed, then at the close of
business on the day next preceding the day on which notice of such meeting is
given, or if
2
<PAGE>
notice is waived, at the close of business on the day next preceding the day on
which the meeting is held.
Each stockholder entitled to vote at any meeting may vote either in
person or by proxy, duly appointed by an instrument in writing executed by such
stockholder and bearing a date not more than three years prior to said meeting,
unless said proxy provides for a longer period. Any such proxy shall be
delivered to the Secretary of such meeting at or prior to the time designated
for holding such meeting, but in any event not later than the time designated in
the order of business for so delivering such proxies.
At all meetings of stockholders all matters, except as otherwise
provided by law, the Certificate of Incorporation, or these By-Laws shall be
determined by a majority vote of the stockholders present in person or by proxy
and entitled to vote thereat, and where a separate vote by class is required, a
majority of the votes cast by the stockholders of such class present in person
or by proxy, shall be the act of such class.
The vote on any matter, including the election of directors, shall be
by written ballot. Each ballot shall be signed by the stockholder voting, or by
such stockholder's proxy, and shall state the number of shares voted. All
proxies, ballots and vote tabulations that identify the particular vote of a
stockholder shall be kept confidential, except that disclosure of the particular
vote may be made: (i) to allow the inspectors to certify the results of the
vote; (ii) as necessary under applicable legal requirements, including the
pursuit or defense of judicial actions; (iii) when such disclosure is expressly
requested by such stockholder; and (iv) except where such vote is included in a
comment written on a proxy, consent or ballot, and disclosure is necessary, in
the opinion of the inspector, for an understanding of the comment.
Proxy cards shall be returned in envelopes addressed to the
inspectors, who shall receive, inspect and tabulate the proxies. Comments
written on proxies, consents or ballots shall be transcribed and provided to the
Secretary with the name and address of the stockholder.
Nothing in this Section 6 shall prohibit the inspector from making
available to the Corporation, during the period prior to any annual or special
meeting, information as to which stockholders have not voted and periodic status
reports on the aggregate vote.
Section 7. List of Stockholders Entitled to Vote. The officer of the
-------------------------------------
Corporation who has charge of the stock ledger of the Corporation shall prepare
and make, at least ten (10) days before every meeting of stockholders, a
complete list of the stockholders entitled to vote at the meeting, arranged in
alphabetical order and showing the address of each stockholder and the number of
shares registered in the name of each stockholder. Such list shall be open to
the examination of any stockholder, for any purpose germane to the meeting,
during ordinary business hours, for a period of at least ten (10) days prior to
the meeting, either at a place within the city where the meeting is to be held,
which place shall be specified in the notice of the meeting, or, if not so
specified, at the place where the meeting is to be
3
<PAGE>
held. The list shall also be produced and kept at the time and place of the
meeting during the whole time thereof and may be inspected by any stockholder of
the Corporation who is present.
Section 8. Stock Ledger. The stock ledger of the Corporation shall
-------------
be the only evidence as to who are the stockholders entitled to examine the
stock ledger, the list required by Section 6 of this Article II or the books of
the Corporation, or to vote in person or by proxy at any meeting of
stockholders.
Section 9. Advance Notice of Stockholder-Proposed Business at Annual
---------------------------------------------------------
Meeting. To be properly brought before the Annual Meeting, business must be
- --------
either (a) specified in the notice of meeting (or any supplement thereto) given
by or at the direction of the Board of Directors, (b) otherwise properly brought
before the meeting by or at the direction of the Board of Directors or (c)
otherwise properly brought before the meeting by a stockholder. For business to
be properly brought before an Annual Meeting by a stockholder, the stockholder
must have given timely notice thereof in writing to the Secretary of the
Corporation. To be timely, a stockholder's notice must be delivered to or
mailed and received at the principal executive offices of the Corporation not
less than ninety (90) nor more than one hundred twenty (120) days prior to the
one year anniversary of the date of the Annual Meeting of the previous year;
provided, however, that in the event that the Annual Meeting is called for a
date that is not within thirty (30) days before or after such anniversary date,
notice by the stockholder in order to be timely must be so received not earlier
than one hundred twenty (120) days prior to such Annual Meeting and not later
than the close of business on the tenth (10th) day following the day on which
notice of the date of the Annual Meeting was mailed or public disclosure of the
date of the annual meeting was made, whichever first occurs. A stockholder's
notice to the Secretary shall set forth as to each matter the stockholder
proposes to bring before the Annual Meeting (i) a brief description of the
business desired to be brought before the Annual Meeting and the reasons for
conducting such business at the Annual Meeting, (ii) the name and address, as
they appear on the Corporation's books, of the stockholder proposing such
business, (iii) the class and number of shares of the Corporation that are
beneficially owned by the stockholder, (iv) any material interest of the
stockholder in such business and (v) any other information relating to the
person or the proposal that is required to be disclosed pursuant to Regulation
14A under the Securities Exchange Act of 1934, as amended (or any successor
provision or law) or applicable law.
Notwithstanding anything in these By-Laws to the contrary, no business
shall be conducted at an Annual Meeting except in accordance with the procedures
set forth in this Section 9; provided, however, that nothing in this Section 9
shall be deemed to preclude discussion by any stockholder of any business
properly brought before the Annual Meeting. The Chairman of an Annual Meeting
shall, if the facts warrant, determine and declare to the meeting that business
was not properly brought before the meeting in accordance with the provisions of
this Section 9 and if he should so determine, he shall so declare to the meeting
and any such business not properly brought before the meeting shall not be
transacted.
4
<PAGE>
Section 10. Nomination of Directors; Advance Notice of Stockholder
------------------------------------------------------
Nominations. Only persons who are nominated in accordance with the procedures
- ------------
set forth in this Section 10 shall be eligible for election as directors.
Nominations of persons for election to the Board of Directors of the Corporation
at the Annual Meeting or at any special meeting of stockholders called in the
manner set forth in Article II, Section 3 hereof for the purpose of electing
directors may be made at a meeting of stockholders by or at the direction of the
Board of Directors, by any nominating committee or person appointed for such
purpose by the Board of Directors, or by any stockholder of the Corporation
entitled to vote for the election of directors at the meeting who complies with
the notice procedures set forth in this Section 10. Such nominations, other
than those made by, or at the direction of, or under the authority of the Board
of Directors, shall be made pursuant to timely notice in writing to the
Secretary of the Corporation. To be timely, a stockholder's notice shall be
delivered to or mailed and received at the principal executive offices of the
Corporation (a) in the case of an Annual Meeting, not less than ninety (90) nor
more than one hundred twenty (120) days prior to the one year anniversary of the
date of the Annual Meeting of the previous year; provided, however, that in the
event that the Annual Meeting is called for a date that is not within thirty
(30) days before or after such anniversary date, notice by the stockholder in
order to be timely must be so received not earlier than one hundred twenty (120)
days prior to such Annual Meeting and not later than the close of business on
the tenth (10th) day following the day on which notice of the date of the annual
meeting was mailed or public disclosure of the date of the Annual Meeting was
made, whichever first occurs; and (b) in the case of a special meeting of
stockholders called in the manner set forth in Article II, Section 3 hereof for
the purpose of electing directors, not earlier than one hundred twenty (120)
days prior to such special meeting and not later than the close of business on
the tenth (10th) day following the day on which notice of the date of the
special meeting was mailed or public disclosure of the date of the special
meeting was made, whichever first occurs. Such stockholder's notice to the
Secretary shall set forth (a) as to each person whom the stockholder proposes to
nominate for election or re-election as a director, (i) the name, age, business
address and residence address of the person, (ii) the principal occupation or
employment of the person, (iii) the class and number of shares of capital stock
of the Corporation, if any, which are beneficially owned by the person and (iv)
any other information relating to the person that is required to be disclosed in
solicitations for proxies for election of directors pursuant to Regulation 14A
under the Securities Exchange Act of 1934, as amended (or any successor
provision or law) or applicable law; and (b) as to the stockholder giving the
notice (i) the name and record address of the stockholder and (ii) the class and
number of shares of capital stock of the Corporation which are beneficially
owned by the stockholder.
The Chairman of the meeting shall, if the facts warrant, determine and
declare to the meeting that a nomination was not made in accordance with the
foregoing procedures and, if he should so determine, he shall so declare to the
meeting and the defective nomination shall be disregarded.
5
<PAGE>
ARTICLE III
DIRECTORS
Section 1. Number; Resignation; Removal. Except as otherwise required
----------------------------
by the Certificate of Incorporation, the number of directors which shall
constitute the whole Board of Directors shall be fixed from time to time by
resolution of the Board of Directors, but shall not be less than six (6) nor
more than twenty-four (24). Except as provided in Section 2 of this Article III
and in the Certificate of Incorporation, directors shall be elected by a
plurality of the votes cast at the Annual Meeting of Stockholders. The
directors shall be divided into three classes, designated Class I, Class II and
Class III, as provided in the Certificate of Incorporation. A director may
resign at any time upon notice to the Corporation. A director may be removed
only for cause.
Section 2. Vacancies. Vacancies and newly created directorships
----------
resulting from any increase in the authorized number of directors may be filled
by a majority of the remaining directors then in office, though less than a
quorum, or by a sole remaining director, and the directors so elected shall hold
office until the next election for such class and until their successors are
duly elected and qualified, or until their earlier resignation or removal. If
there are no directors in office, then an election of directors may be held in
the manner provided by the General Corporation Law of the State of Delaware. No
decrease in the number of directors constituting the Board of Directors shall
shorten the term of any incumbent director.
Section 3. Duties and Powers. The business of the Corporation shall
-----------------
be managed by or under the direction of the Board of Directors which may
exercise all such powers of the Corporation and do all such lawful acts and
things as are not by statute or by the Certificate of Incorporation or by these
By-Laws directed or required to be exercised or done solely by the stockholders.
Section 4. Meetings. The Board of Directors of the Corporation may
--------
hold meetings, both regular and special, either within or without the State of
Delaware. Regular meetings of the Board of Directors may be held without notice
at such time and at such place as may from time to time be determined by the
Board of Directors. Special meetings of the Board of Directors may be called by
the Chairman of the Board, the Chief Executive Officer, the President or any
director. Notice thereof stating the place, date and hour of the meeting shall
be given to each director either (i) by mail or courier not less than forty-
eight (48) hours before the date of the meeting or (ii) by telephone, telegram
or facsimile transmission, not less than twenty-four (24) hours before the time
of the meeting or on such shorter notice as the person or persons calling such
meeting may deem necessary or appropriate in the circumstances (provided that
notice of any meeting need not be given to any director who shall either, before
or after such meeting, submit a signed waiver of notice or attends the meeting
without protesting, prior to its commencement, the lack of notice).
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Section 5. Quorum. Except as may be otherwise provided by law, the
------
Certificate of Incorporation or these By-Laws, a majority of the entire Board of
Directors shall be necessary to constitute a quorum for the transaction of
business, and the vote of a majority of the directors present at a meeting at
which a quorum is present shall be the act of the Board of Directors. If a
quorum is not present at a meeting of the Board of Directors, a majority of the
directors present may adjourn the meeting to such time and place as they may
determine without notice other than an announcement at the meeting until enough
directors to constitute a quorum shall attend.
Section 6. Action Without A Meeting. Unless otherwise provided by the
------------------------
Certificate of Incorporation or these By-Laws, any action required or permitted
to be taken by the Board of Directors or any committee thereof may be taken
without a meeting if all members of the Board of Directors or the committee
consent in writing to the adoption of a resolution authorizing the action. The
resolution and the written consents thereto by the members of the Board of
Directors or committee shall be filed with the minutes of the proceedings of the
Board of Directors or such committee.
Section 7. Participation By Telephone. Unless otherwise provided by
--------------------------
the Certificate of Incorporation or these By-Laws, any one or more members of
the Board of Directors or any committee thereof may participate in a meeting of
the Board of Directors or such committee by means of a conference telephone or
similar communications equipment allowing all persons participating in the
meeting to hear each other. Participation by such means shall constitute
presence in person at the meeting.
Section 8. Compensation. The directors may be paid their expenses, if
-------------
any, for attendance at each meeting of the Board of Directors or any committee
thereof and may be paid compensation as a director, committee member or chairman
of any committee and for attendance at each meeting of the Board of Directors or
committee thereof. No such payment shall preclude any director from serving the
Corporation in any other capacity and receiving compensation therefore or
entering into transactions otherwise permitted by the Certificate of
Incorporation, these By-Laws or applicable law.
Section 9. Resignation. Any director may resign at any time. Such
-----------
resignation shall be made in writing and shall take effect at the time specified
therein, or, if no time be specified, at the time of its receipt by the Chairman
of the Board, or if none, by the Chief Executive Officer, President or the
Secretary. The acceptance of a resignation shall not be necessary to make it
effective unless so specified therein.
ARTICLE IV
COMMITTEES
Section 1. Committees. The Board of Directors, by resolution passed
----------
by a majority of the entire Board of Directors, may designate one or more
committees, each committee to consist of one or more of the directors of the
Corporation. The Board of
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Directors may designate one or more directors as alternate members of any
committee, who may replace any absent or disqualified member at any meeting of
any such committee. In the absence or disqualification of a member of a
committee, and in the absence of a designation by the Board of Directors of an
alternate member to replace the absent or disqualified member, the member or
members thereof present at any meeting and not disqualified from voting, whether
or not such member or member constitute a quorum, may by unanimous vote appoint
another member of the Board of Directors to act at the meeting in the place of
any absent or disqualified member. Any committee, to the extent allowed by law
and provided in the resolution establishing such committee, shall have and may
exercise all the powers and authority of the Board of Directors in the
management of the business and affairs of the Corporation, including the power
to adopt a certificate of ownership and merger pursuant to Section 253 of
Delaware General Corporation Law, the authority to issue shares and the
authority to declare a dividend, except as limited by Delaware General Corporate
law or other applicable law. All acts done by any committee within the scope of
its powers and duties pursuant to these By-Laws and the resolutions adopted by
the Board of Directors shall be deemed to be, and may be certified as being,
done or conferred under authority of the Board of Directors. The Secretary or
any Assistant Secretary is empowered to certify that any resolution duly adopted
by any such committee is binding upon the Corporation and to execute and deliver
such certifications from time to time as may be necessary or proper to the
conduct of the business of the Corporation.
Section 2. Resignation. Any member of a committee may resign at any
-----------
time. Such resignation shall be made in writing and shall take effect at the
time specified therein, or, if no time be specified, at the time of its receipt
by the Chairman of the Board, or if none, by the Chief Executive Officer,
President or the Secretary. The acceptance of a resignation shall not be
necessary to make it effective unless so specified therein.
Section 3. Quorum. A majority of the members of a committee shall
------
constitute a quorum. The vote of a majority of the members of a committee
present at any meeting at which a quorum is present shall be the act of such
committee.
Section 4. Record of Proceedings. Each committee shall keep a record
---------------------
of its acts and proceedings, and shall report the same to the Board of Directors
when and as required by the Board of Directors.
Section 5. Organization, Meetings, Notices. A committee may hold its
-------------------------------
meetings at the principal office of the Corporation, or at any other place upon
which a majority of the committee may at any time agree. Each committee may
make such rules as it may deem expedient for the regulation and carrying on of
its meetings and proceedings.
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ARTICLE V
OFFICERS
Section 1. General. The officers of the Corporation shall be elected
-------
by the Board of Directors and shall consist of a Chairman of the Board, Chief
Executive Officer, a President, a Chief Financial Officer, one or more Senior
Executive Vice Presidents, one or more Executive Vice Presidents, one or more
Senior Vice Presidents, one or more First Vice Presidents, one or more Vice
Presidents, a Secretary, a Treasurer and a Controller. The Board of Directors,
in its discretion, may also elect and specifically identify as officers of the
Corporation one or more Vice Chairmen of the Board, one or more Assistant Vice
Presidents, one or more Assistant Secretaries, one or more Assistant Treasurers
and one or more Assistant Controllers as in its judgment may be necessary or
desirable. Any number of offices may be held by the same person, unless
otherwise prohibited by law, the Certificate of Incorporation or these By-Laws.
The officers of the Corporation need not be stockholders or directors of the
Corporation.
Section 2. Election; Removal; Remuneration. The Board of Directors
--------------------------------
at its first meeting held after each Annual Meeting of Stockholders shall elect
the officers of the Corporation who shall hold their offices for such terms and
shall exercise such powers and perform such duties as shall be determined from
time to time by the Board of Directors and may elect additional officers and may
fill vacancies among the officers previously elected at any subsequent meeting
of the Board of Directors; and all officers of the Corporation shall hold office
until their successors are chosen and qualified, or until their earlier
resignation or removal. Any officer elected by the Board of Directors may be
removed at any time, either for or without cause, by the affirmative vote of a
majority of the Board of Directors. The compensation of all officers of the
Corporation shall be fixed by the Board of Directors or a committee thereof.
Section 3. Voting Securities Owned by the Corporation. Powers of
-------------------------------------------
attorney, proxies, waivers of notice of meetings, consents and other instruments
relating to securities owned by the Corporation may be executed in the name of
and on behalf of the Corporation by the Chairman of the Board, Chief Executive
Officer, the President, Secretary or any Senior Executive Vice President,
Executive Vice President, Senior Vice President, First Vice President, Vice
President or Assistant Secretary and any such officer may, in the name and on
behalf of the Corporation, take all such action as any such officer may deem
advisable to vote in person or by proxy at any meeting of security holders of
any corporation in which the Corporation may own securities and at any such
meeting shall possess and may exercise any and all rights and powers incident to
the ownership of such securities and which, as the owner thereof, the
Corporation might have exercised and possessed if present. The Board of
Directors may, by resolution, from time to time confer like powers upon any
other person or persons.
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Section 4. Chairman of the Board. The Chairman of the Board may be,
---------------------
but need not be, a person other than the Chief Executive Officer of the
Corporation. The Chairman of the Board may be, but need not be, an officer or
employee of the Corporation. The Chairman of the Board shall preside at
meetings of the Board of Directors and shall establish agendas for such
meetings. In addition, the Chairman of the Board shall assure that matters of
significant interest to stockholders and the investment community are addressed
by management. The Chairman of the Board shall be an ex-officio member of each
standing committee of the Board to which the Board of Directors has not
specifically designated him as a member.
Section 5. Chief Executive Officer. The Chief Executive Officer
-----------------------
shall, subject to the direction of the Board of Directors, have general and
active control of the affairs and business of the Corporation and general
supervision of its officers, officials, employees and agents. The Chief
Executive Officer shall preside at all meetings of the stockholders and shall
preside at all meetings of the Board of Directors and any committee thereof of
which he is a member, unless the Board of Directors or such committee shall have
chosen another chairman. The Chief Executive Officer shall see that all orders
and resolutions of the Board are carried into effect, and in addition, the Chief
Executive Officer shall have all the powers and perform all the duties generally
appertaining to the office of the chief executive officer of a corporation. The
Chief Executive Officer shall designate the person or persons who shall exercise
his powers and perform his duties in his absence or disability and the absence
or disability of the President.
Section 6. President. The President shall have such powers and
---------
perform such duties as are prescribed by the Chief Executive Officer or the
Board of Directors, and in the absence or disability of the Chief Executive
Officer, the President shall have the powers and perform the duties of the Chief
Executive Officer, except to the extent the Board of Directors shall have
otherwise provided. In addition, the President shall have such powers and
perform such duties generally appertaining to the office of the president of a
corporation, except to the extent the Chief Executive Officer or the Board of
Directors shall have otherwise provided.
Section 7. Vice Chairmen of the Board. The Vice Chairmen of the
---------------------------
Board shall be members of the Board of Directors and shall perform such duties
and have such powers as may be prescribed by the Board of Directors, the
Chairman of the Board or these By-Laws.
Section 8. Senior Executive Vice Presidents. The Senior Executive
--------------------------------
Vice Presidents of the Corporation shall perform such duties and have such
powers as may, from time to time, be assigned to them by these By-Laws, the
Board of Directors, the Chairman of the Board, the Chief Executive Officer or
the President.
Section 9. Executive Vice Presidents. The Executive Vice Presidents
-------------------------
of the Corporation shall perform such duties and have such powers as may, from
time to time, be assigned to them by these By-Laws, the Board of Directors, the
Chairman of the Board, the Chief Executive Officer, the President or a Senior
Executive Vice President.
10
<PAGE>
Section 10. First Vice Presidents. The First Vice Presidents of the
---------------------
Corporation shall perform such duties and have such powers as may, from time to
time, be assigned to them by these By-Laws, the Board of Directors, the Chairman
of the Board, the Chief Executive Officer, the President, a Senior Executive
Vice President or an Executive Vice President.
Section 11. Vice Presidents. The Vice Presidents of the Corporation
---------------
shall perform such duties and have such powers as may, from time to time, be
assigned to them by these By-Laws, the Board of Directors, the Chairman of the
Board, the Chief Executive Officer, the President, a Senior Executive Vice
President, an Executive Vice President or a First Vice President.
Section 12. Secretary. The Secretary shall attend all meetings of the
---------
Board of Directors and of the stockholders and record all votes and the minutes
of all proceedings in a book to be kept for that purpose, and shall perform like
duties for any committee appointed by the Board of Directors. The Secretary
shall keep in safe custody the seal of the Corporation and affix it to any
instrument when so authorized by the Board of Directors. The Secretary shall
give or cause to be given, notice of all meetings of stockholders and special
meetings of the Board of Directors and shall perform generally all the duties
usually appertaining to the office of secretary of a corporation and shall
perform such other duties and have such other powers as may be prescribed by the
Board of Directors or these By-Laws. The Board of Directors may give general
authority to any other officer to affix the seal of the Corporation and to
attest the affixing by his signature.
Section 13. Assistant Secretaries. The Assistant Secretaries shall be
---------------------
empowered and authorized to perform all of the duties of the Secretary in the
absence or disability of the Secretary and shall perform such other duties and
have such other powers as may be prescribed by the Board of Directors, the
Secretary or these By-Laws.
Section 14. Chief Financial Officer. The Chief Financial Officer
------------------------
shall have responsibility for the administration of the financial affairs of the
Corporation and shall exercise supervisory responsibility for the performance of
the duties of the Treasurer and the Controller. The Chief Financial Officer
shall render to the Board of Directors, at its regular meetings, or when the
Board of Directors so requires, an account of all of the transactions effected
by the Treasurer and Controller and of the financial condition of the
Corporation. The Chief Financial Officer shall generally perform all the duties
usually appertaining to the affairs of a chief financial officer of a
corporation and shall perform such other duties and have such other powers as
may be prescribed by the Board of Directors or these By-Laws.
Section 15. Treasurer. The Treasurer shall have the custody of the
---------
corporate funds and securities and shall cause to be kept full and accurate
accounts of receipts and disbursements in books belonging to the Corporation and
shall deposit all monies and other valuable effects in the name and to the
credit of the Corporation in such depositories as may be designated by persons
authorized by the Board of Directors. The Treasurer shall disburse the
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<PAGE>
funds of the Corporation as may be ordered by the Board of Directors, taking
proper vouchers for such disbursements, and shall render to the Chairman of the
Board, the President and the Board of Directors whenever they may require it, an
account of all of the transactions effected by the Treasurer and of the
financial condition of the Corporation. The Treasurer may be required to give a
bond for the faithful discharge of his or her duties. The Treasurer shall
generally perform all duties appertaining to the office of treasurer of a
corporation and shall perform such other duties and have such other powers as
may be prescribed by the Board of Directors or these By-Laws.
Section 16. Assistant Treasurers. The Assistant Treasurers shall be
--------------------
empowered and authorized to perform all the duties of the Treasurer in the
absence or disability of the Treasurer and shall perform such other duties and
have such other powers as may be prescribed by the Board of Directors, the
Treasurer or these By-Laws.
Section 17. Controller. The Controller shall prepare and have the
-----------
care and custody of the books of account of the Corporation. The Controller
shall keep a full and accurate account of all monies, received and paid on
account of the Corporation, and shall render a statement of the Controller's
accounts whenever the Board of Directors shall require. The Controller shall
generally perform all the duties usually appertaining to the affairs of the
controller of a corporation and shall perform such other duties and have such
other powers as may be prescribed by the Board of Directors, the Chief Financial
Officer or these By-Laws. The Controller may be required to give a bond for the
faithful discharge of his or her duties.
Section 18. Assistant Controllers. The Assistant Controllers shall
----------------------
in the absence or disability of the Controller perform the duties and exercise
the powers of the Controller and shall perform such other duties and have such
other powers as may be prescribed by the Board of Directors, the Controller or
these By-Laws.
Section 19. Additional Powers and Duties. In addition to the
-----------------------------
foregoing especially enumerated duties and powers, the several officers of the
Corporation shall perform such other duties and exercise such further powers as
the Board of Directors may, from time to time, determine or as may be assigned
to them by any superior officer.
Section 20. Other Officers. The Board of Directors may designate
---------------
such other officers having such duties and powers as it may specify from time to
time.
ARTICLE VI
CAPITAL STOCK
Section 1. Form of Certificate. Every holder of stock in the
-------------------
Corporation shall be entitled to have a certificate signed in the name of the
Corporation (i) by the Chairman of the Board, the Chief Executive Officer, the
President or any Vice President and (ii) by the Treasurer or an Assistant
Treasurer or the Secretary or an Assistant Secretary, certifying the number of
shares owned by such holder in the Corporation.
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<PAGE>
Section 2. Signatures. Any signature required to be on a certificate
-----------
may be a facsimile. In case any officer, transfer agent or registrar who has
signed or whose facsimile signature has been placed upon a certificate shall
have ceased to be such officer, transfer agent or registrar before such
certificate is issued, it may be issued by the Corporation with the same effect
as if he were such officer, transfer agent or registrar at the date of issue.
Section 3. Lost, Stolen or Destroyed Certificates. The Board of
---------------------------------------
Directors may direct a new certificate to be issued in place of any certificate
theretofore issued by the Corporation alleged to have been lost, stolen or
destroyed, upon the making of an affidavit of that fact by the person claiming
the certificate of stock to be lost, stolen or destroyed. When authorizing such
issue of a new certificate, the Board of Directors may, in its discretion and as
a condition precedent to the issuance thereof, require the owner of such lost,
stolen or destroyed certificate, or his legal representative, to advertise the
same in such manner as the Board of Directors shall require and/or to give the
Corporation a bond in such sum as it may direct as indemnity against any claim
that may be made against the Corporation with respect to the certificate alleged
to have been lost, stolen or destroyed.
Section 4. Transfers. Stock of the Corporation shall be transferable
----------
in the manner prescribed by law and in these By-Laws. Transfers of stock shall
be made on the books of the Corporation only by the holder of record or by such
person's attorney duly authorized upon surrender and cancellation of
certificates for a like number of shares properly endorsed and the payment of
all taxes due thereon.
Section 5. Record Date. In order that the Corporation may determine
------------
the stockholders entitled to notice of or to vote at any meeting of stockholders
or any adjournment thereof, or entitled to express consent to corporate action,
or entitled to receive payment of any dividend or other distribution or
allotment of any rights, or entitled to exercise any rights in respect of any
change, conversion or exchange of stock or for the purpose of any other lawful
action, the Board of Directors may fix, in advance, a record date, which shall
not be more than sixty (60) days nor less than ten (10) days before the date of
such meeting, nor more than sixty (60) days prior to any other action. A
determination of stockholders of record entitled to notice of or to vote at a
meeting of stockholders shall apply to any adjournment of the meeting; provided,
however, that the Board of Directors may fix a new record date for the adjourned
meeting.
Section 6. Beneficial Owners. The Corporation shall be entitled to
------------------
recognize the exclusive right of the person registered on its books as the owner
of a share to receive dividends and to vote as such owner, and to hold liable
for calls and assessments a person registered on its books as the owner of
shares, and shall not be bound to recognize any equitable or other claim to or
interest in such share or shares on the part of any other person, whether or not
it shall have express or other notice thereof, except as otherwise provided by
law.
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Section 7. Dividends. Subject to the provisions of the Certificate
----------
of Incorporation or applicable law, dividends upon the capital stock of the
Corporation, if any, may be declared by the Board of Directors at any regular or
special meeting, and may be paid in cash, in property, or in shares of capital
stock. Before payment of any dividend, there may be set aside out of any funds
of the Corporation available for dividends such sum or sums as the Board of
Directors from time to time, in its absolute discretion, deems proper as a
reserve or reserves to meet contingencies, or for equalizing dividends, or for
repairing or maintaining any property of the Corporation or for any proper
purpose, and the Board of Directors may modify or abolish any such reserve.
ARTICLE VII
INDEMNIFICATION
Section 1. Indemnification Respecting Third Party Claims. (a) The
---------------------------------------------
Corporation, to the full extent and in a manner permitted by Delaware law as in
effect from time to time, shall indemnify, in accordance with the provisions of
this Article, any person (including the heirs, executors, administrators or
estate of any such person) who was or is made a party to or is threatened to be
made a party to any threatened, pending or completed action, suit or proceeding
(including any appeal thereof), whether civil, criminal, administrative,
regulatory or investigative in nature (other than an action by or in the right
of the Corporation), by reason of the fact that such person is or was a director
or officer of the Corporation, or, at a time when he was a director or officer
of the Corporation, is or was either serving at the request of the Corporation
as a director, officer, partner, trustee, fiduciary, employee or agent (a
"Subsidiary Officer") of another corporation, partnership, joint venture, trust,
employee benefit plan or other enterprise (an "Associated Entity"), against
expenses (including attorneys' fees and disbursements), costs, judgments, fines,
penalties and amounts paid in settlement actually and reasonably incurred by
such person in connection with such action, suit or proceeding if such person
acted in good faith and in a manner such person reasonably believed to be in or
not opposed to the best interests of the Corporation, and, with respect to any
criminal action or proceeding, had no reasonable cause to believe his conduct
was unlawful; provided, however, that (i) the Corporation shall not be obligated
to indemnify a person who is or was a director or officer of the Corporation
against expenses incurred in connection with an action, suit, proceeding or
investigation to which such person is threatened to be made a party but does not
become a party unless the incurring of such expenses was authorized by or under
the authority of the Board of Directors and (ii) the Corporation shall not be
obligated to indemnify against any amount paid in settlement unless the Board of
Directors has consented to such settlement. The termination of any action, suit
or proceeding by judgment, order, settlement or conviction or upon a plea of
nolo contendere or its equivalent shall not, of itself, create a presumption
- ---- ----------
that the person did not act in good faith and in a manner which such person
reasonably believed to be in or not opposed to the best interests of the
Corporation, and, with respect to any criminal action or proceeding, that such
person had reasonable cause to believe that his conduct was unlawful.
Notwithstanding anything to the contrary in the foregoing provisions of this
Section 1(a), a person shall not be entitled, as a matter of right, to
indemnification pursuant to this Section 1(a) against costs or
14
<PAGE>
expenses incurred in connection with any action, suit or proceeding commenced by
such person against the Corporation or any Associated Entity or any person who
is or was a director, officer, fiduciary, employee or agent of the Corporation
or a Subsidiary Officer of any Associated Entity, but such indemnification may
be provided by the Corporation in a specific case as permitted by Section 6
below in this Article.
(b) The Corporation may indemnify any employee or agent of the
Corporation in the manner and to the same extent as it is required to indemnify
any director or officer under Section 1(a) above in this Article.
Section 2. Indemnification Respecting Derivative Claims. (a) The
--------------------------------------------
Corporation, to the full extent and in a manner permitted by Delaware law as in
effect from time to time, shall indemnify, in accordance with the provisions of
this Article, any person (including the heirs, executors, administrators or
estate of any such person) who was or is made a party to or is threatened to be
made a party to any threatened, pending or completed action or suit (including
any appeal thereof) brought in the right of the Corporation to procure a
judgment in its favor by reason of the fact that such person is or was a
director or officer of the Corporation, or, at a time when he was a director or
officer of the Corporation, is or was serving at the request of the Corporation
as a Subsidiary Officer of an Associated Entity against expenses (including
attorneys' fees and disbursements) and costs actually and reasonably incurred by
such person in connection with the defense or settlement of such action or suit
if such person acted in good faith and in a manner such person reasonably
believed to be in or not opposed to the best interests of the Corporation,
except that no indemnification shall be made in respect of any claim, issue or
matter as to which such person shall have been adjudged to be liable to the
Corporation unless, and only to the extent that the Board of Directors or a
court having jurisdiction with respect shall determine that, despite the
adjudication of liability but in view of all the circumstances of the case, such
person is fairly and reasonably entitled to indemnity for such expenses and
costs as the Board of Directors or such court shall deem proper; provided,
however, that the Corporation shall not be obligated to indemnify a director or
officer of the Corporation against expenses incurred in connection with an
action or suit to which such person is threatened to be made a party but does
not become a party unless the incurrence of such expenses was authorized by or
under the authority of the Board of Directors. Notwithstanding anything to the
contrary in the foregoing provisions of this Section 2(a), a person shall not be
entitled, as a matter of right, to indemnification pursuant to this Section 2(a)
against costs and expenses incurred in connection with any action or suit in the
right of the Corporation commenced by such person, but such indemnification may
be provided by the Corporation in any specific case as permitted by Section 6
below in this Article.
(b) The Corporation may indemnify any employee or agent of the
Corporation in the manner and to the same extent as it is required to indemnify
any director or officer under Section 2(a) above in this Article.
15
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Section 3. Determination of Entitlement to Indemnification. Any
-----------------------------------------------
indemnification to be provided under any of Section 1(a), 1(b), 2(a) or 2(b)
above in this Article (unless ordered by a court of competent jurisdiction)
shall be made by the Corporation only as authorized in the specific case upon a
determination that indemnification is proper under the circumstances because
such person had met the applicable standard of conduct set forth in such section
of this Article. Such determination shall be made (i) by the Board of Directors
by a majority vote of a quorum consisting of directors who were not parties to
the action, suit or proceeding in respect of which indemnification is sought or
by majority vote of the members of a committee of the Board of Directors
composed of at least two members each of whom is not a party to such action,
suit or proceeding, or (ii) if such a quorum is not obtainable and/or such a
committee is not established or available, or, even if such a quorum is
obtainable or committee available, if a quorum of disinterested directors so
directs, by independent legal counsel in a written opinion, or (iii) by action
of the stockholders taken as permitted by law. In the event a request for
indemnification is made by any person referred to in paragraph 1(a) or 2(a)
above in this Article, the Corporation shall use its reasonable best efforts to
cause such determination to be made not later than sixty (60) days after such
request is made.
Section 4. Right to Indemnification upon Successful Defense and for
--------------------------------------------------------
Service as a Witness. (a) Notwithstanding the other provisions of this
- --------------------
Article, to the extent that a director, officer, employee or agent of the
Corporation has been successful on the merits or otherwise in defense of any
action, suit or proceeding referred to in any of Section 1(a), 1(b), 2(a) or
2(b) above in this Article, or in defense of any claim, issue or matter therein,
such person shall be indemnified against expenses (including attorneys' fees and
disbursements) and costs actually and reasonably incurred by such person in
connection therewith.
(b) To the extent any person who is or was a director or officer of
the Corporation in office on the effective date of this Article or thereafter
has served or prepared to serve as a witness in, but is not a party to, any
action, suit or proceeding (whether civil, criminal, administrative, regulatory
or investigative in nature), including any investigation by any legislative body
or any securities or commodities exchange of which the Corporation or an
Associated Entity is a member or to the jurisdiction of which it is subject, by
reason of his or her services as a director or officer of the Corporation or his
or her service as a Subsidiary Officer of an Associated Entity at a time when he
or she was a director or officer of the Corporation (assuming such person is or
was, as evidenced by a writing to such effect, serving at the request of, or to
represent the interests of, the Corporation as a Subsidiary Officer of such
Associated Entity), the Corporation may indemnify such person against expenses
(including attorneys' fees and disbursements) and out-of-pocket costs actually
and reasonably incurred by such person in connection therewith and shall use its
reasonable best efforts to provide such indemnity within sixty (60) days after
receipt by the Corporation from such person of a statement requesting such
indemnification, averring such service and reasonably evidencing such expenses
and costs; it being understood, however, that the Corporation shall have no
obligation under this Article to compensate such person for such person's time
or efforts so expended. The Corporation shall indemnify any employee or agent
of the
16
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Corporation in the manner and to the same extent as it is required to indemnify
any director or officer of the Corporation pursuant to the foregoing sentence of
this Section 4(b).
Section 5. Advance of Expenses. (a) Expenses and costs incurred by
-------------------
any person referred to in Section 1(a) or 2(a) above in this Article in
defending a civil, criminal, administrative, regulatory or investigative action,
suit or proceeding shall be paid by the Corporation in advance of the final
disposition of such action, suit or proceeding upon receipt of an undertaking in
writing by or on behalf of such person to repay such amount if it shall
ultimately be determined that such person is not entitled to be indemnified in
respect of such costs and expenses by the Corporation as authorized by this
Article.
(b) Expenses and costs incurred by any person referred to in Section
1(b) or 2(b) above in this Article in defending a civil, criminal,
administrative, regulatory or investigative action, suit or proceeding may be
paid by the Corporation in advance of the final disposition of such action, suit
or proceeding as authorized by or under the authority of the Board of Directors
upon receipt of an undertaking in writing by or on behalf of such person to
repay such amount if it shall ultimately be determined that such person is not
entitled to be indemnified by the Corporation in respect of such costs and
expenses as authorized by this Article and subject to any limitations or
qualifications provided by or under the authority of the Board of Directors.
Section 6. Indemnification Not Exclusive. The provision of
-----------------------------
indemnification to or the advancement of expenses and costs to any person under
this Article, or the entitlement of any person to indemnification or advancement
of expenses and costs under this Article, shall not limit or restrict in any way
the power of the Corporation to indemnify or advance expenses and costs to such
person in any other way permitted by law or be deemed exclusive of, or
invalidate, any right to which any person seeking indemnification or advancement
of expenses and costs may be entitled under any law, agreement, vote of
stockholders or disinterested directors or otherwise, both as to action in such
person's capacity as an officer, director, employee or agent of the Corporation
and as to action in any other capacity.
Section 7. Corporate Obligations; Reliance. The provisions of
-------------------------------
Sections 1 through 6 above of this Article shall be deemed to create a binding
obligation on the part of the Corporation to the officers and directors of the
Corporation on the effective date of this Article and persons thereafter elected
as officers and directors (including persons who served as officers and
directors on or after such date but who are no longer officers and directors at
the time they present claims for advancement of expenses or indemnity), and such
persons in acting in their capacities as officers or directors of the
Corporation or Subsidiary Officers of any Associated Entity shall be entitled to
rely on such provisions of this Article, without giving notice thereof to the
Corporation.
17
<PAGE>
Section 8. Successors. The right of any person who is or was a
----------
director, officer, employee or agent of the Corporation to indemnification or
advancement of expenses under Sections 1 through 7 above in this Article shall
continue after he shall have ceased to be a director, officer, employee or agent
and shall inure to the benefit of the heirs, distributees, executors,
administrators and other legal representatives of such person.
Section 9. Insurance. The Corporation may purchase and maintain
---------
insurance on behalf of any person who is or was a director, officer, employee or
agent of the Corporation, or is or was serving at the request of, or to
represent the interests of, the Corporation as a Subsidiary Officer of any
Associated Entity, against any liability asserted against such person and
incurred by such person in any capacity, or arising out of such person's status
as such, whether or not the Corporation would have the power to indemnify such
person against such liability under the provisions of this Article or applicable
law.
Section 10. Definitions of Certain Terms. (a) For purposes of this
----------------------------
Article, references to the "Corporation" shall include, in addition to the
resulting corporation, any constituent corporation (including any constituent of
a constituent) absorbed into the Corporation after the effective date of this
Article in a consolidation or merger if such corporation would have been
permitted (if its corporate existence had continued) under applicable law to
indemnify its directors, officers, employees or agents, so that any person who
is or was a director, officer, employee or agent of such constituent
corporation, or is or was serving at the request, or to represent the interests
of, such constituent corporation as a director, officer, employee or agent of
any Associated Entity shall stand in the same position under the provisions of
Sections 1 through 9 above in this Article with respect to the resulting or
surviving corporation as such person would have with respect to such constituent
corporation if its separate existence had continued; provided, however, that, no
such person shall be entitled to indemnity from the Corporation in respect of
his service to such constituent corporation, or at the request or to represent
the interests of such constituent corporation, pursuant to Section 1(a) or 2(a)
above but may be indemnified by the Corporation in respect thereof as permitted
by Section 1(b) or 2(b) above.
(b) For purposes of this Article, references to "fines" shall include
any excise taxes assessed on a person with respect to any employee benefit plan;
references to "serving at the request of the Corporation" shall include any
service as a director, officer, trustee, fiduciary, employee or agent of the
Corporation or any Associated Entity which service imposes duties on, or
involves services by, such director, officer, trustee, fiduciary, employee or
agent with respect to any employee benefit plan, its participants, or
beneficiaries; and a person who acted in good faith and in a manner such person
reasonably believed to be in the interest of the participants and beneficiaries
of an employee benefit plan shall be deemed to have acted in a manner "not
opposed to the best interests of the Corporation" as referred to in this
Article.
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<PAGE>
ARTICLE VIII
GENERAL
Section 1. Fiscal Year. The fiscal year of the Corporation shall be
------------
such date as shall be fixed by resolution of the Board of Directors from time to
time.
Section 2. Corporate Seal. The corporate seal shall have inscribed
---------------
thereon the name of the Corporation, the year of its organization and the words
"Corporate Seal, Delaware" The seal may be used by causing it or a facsimile
thereof to be impressed or affixed or reproduced or otherwise upon any paper,
certificate or document.
Section 3. Disbursements. All checks, drafts or demands for money
--------------
out of the funds of the Corporation and all notes and other evidences of
indebtedness of the Corporation shall be signed by such officer or officers or
such other person or persons as the Board of Directors may from time to time
designate.
Section 4. Amendments. These By-Laws may be altered, amended or
-----------
repealed, in whole or in part, or new By-Laws may be adopted by the stockholders
or by the Board of Directors at any meeting thereof; provided, however, that
notice of such alteration, amendment, repeal or adoption of new By-Laws shall be
contained in the notice of such meeting of stockholders or in a notice of such
meeting of the Board of Directors, as the case may be. Unless a higher
percentage is required by the Certificate of Incorporation as to any matter
which is the subject of these By-Laws, all such amendments must be approved by
either the holders of at least a majority of the outstanding capital stock
entitled to vote thereon or by a majority of the entire Board of Directors then
in office.
Section 5. Definitions. As used in this Article and in these By-Laws
------------
generally, the term "entire Board of Directors" means the total number of
directors which the Corporation would have if there were no vacancies.
19
<PAGE>
EXHIBIT 5
LEHMAN BROTHERS HOLDINGS INC.
THREE WORLD FINANCIAL CENTER
NEW YORK, NY 10285
December 11, 1995
Securities and Exchange Commission
450 Fifth Street, NW
Washington, DC 20549
Ladies and Gentlemen:
I am Deputy General Counsel of Lehman Brothers Holdings Inc., a Delaware
corporation ("Holdings"). A Registration Statement on Form S-3 (the
"Registration Statement"), under the Securities Act of 1933, as amended (the
"Act"), was filed by Holdings with the Securities and Exchange Commission on the
date hereof. The Registration Statement relates to the registration of
8,000,000 shares of Cumulative Voting Preferred Stock, liquidation preference
$25.00 per share (the "Preferred Stock") which American Express (the "Selling
Stockholder") may offer from time to time.
In that connection, I or members of my staff have examined and relied upon
originals or copies, certified or otherwise identified to our satisfaction, of
such documents, corporate records, certificates and instruments relating to
Holdings as I have deemed relevant and necessary to the formation of the opinion
hereinafter set forth. In such examination, I have assumed the genuineness and
authenticity of all documents examined by me or members of my staff and all
signatures thereon, the legal capacity of all persons executing such documents,
the conformity to originals of all copies of documents submitted to us and the
truth and correctness of any representations and warranties contained therein.
Based upon the foregoing, I am of the opinion that:
The Preferred Stock is duly authorized, validly issued, fully paid and non-
assessable, and no holder thereof will be subject to personal liability by
reason of being such a holder.
<PAGE>
Letter to Securities and Exchange Commission
December 11, 1995
Page 2
In rendering this opinion, I express no opinion as to the laws of any
jurisdiction other than the State of New York, the General Corporation Law of
the State of Delaware and the United States of America.
I hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the reference to me under the caption "Legal
Opinions" in the Registration Statement, without admitting that I am an "expert"
under the Act, or the rules and regulations of the Securities and Exchange
Commission issued thereunder, with respect to any part of the Registration
Statement, including this exhibit.
Very truly yours,
Karen M. Muller
Deputy General Counsel
<PAGE>
EXHIBIT 23B
DRAFT
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm as experts under the caption
"Independent Accountants" in the Registration Statement on Form S-3 and related
prospectus of Lehman Brothers Holdings Inc. (the "Company") for the registration
of 8,000,000 shares of 8.44% Cumulative Voting Preferred Stock of the Company
and to the incorporation by reference therein of our report dated January 5,
1995, included in the 1994 Annual Report to Stockholders of Lehman Brothers
Holdings Inc.
New York, New York
December 11, 1995
