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Exhibit 1.1
THE GOLDMAN SACHS GROUP, INC.
DEBT SECURITIES
UNDERWRITING AGREEMENT
July 13, 2000
To the Representatives of the
several Underwriters named in the
respective Pricing Agreements
hereinafter described.
Ladies and Gentlemen:
From time to time The Goldman Sachs Group, Inc., a Delaware corporation
(the "Company"), proposes to enter into one or more Pricing Agreements (each a
"Pricing Agreement") in the form of Annex I hereto, with such additions and
deletions as the parties thereto may determine, and, subject to the terms and
conditions stated herein and therein, to issue and sell to the firms named in
Schedule I to the applicable Pricing Agreement (such firms constituting the
"Underwriters" with respect to such Pricing Agreement and the securities
specified therein) certain of its debt securities (the "Securities") specified
in Schedule II to such Pricing Agreement (with respect to such Pricing
Agreement, the "Designated Securities").
The terms and rights of any particular issuance of Designated
Securities shall be as specified in the Pricing Agreement relating thereto and
in or pursuant to the indenture (the "Indenture") identified in such Pricing
Agreement.
The Company acknowledges and agrees that Goldman, Sachs & Co. may use
the Prospectus (as defined below) in connection with offers and sales of the
Securities as contemplated in the Prospectus under the caption "Plan of
Distribution -- Market-Making Resales by Affiliates" ("Secondary Market
Transactions"). The Company further acknowledges and agrees that Goldman, Sachs
& Co. is under no obligation to effect any Secondary Market Transactions and, if
it does so, it may discontinue effecting such transactions at any time without
providing any notice to the Company. The term "Underwriter", whenever used in
this Agreement, shall include Goldman, Sachs & Co., whether acting in its
capacity as an Underwriter or acting in connection with a Secondary Market
Transaction, except as may be specifically provided otherwise herein.
The Company succeeded to the business of The Goldman Sachs Group, L.P.,
a Delaware limited partnership ("Group"), in a series of transactions, referred
to herein as the "Incorporation Transactions", that were consummated on May 7,
1999. For purposes of the provisions of Annex II hereof, references to the
Company with respect to any time before the consummation of the Incorporation
Transactions shall be deemed to be references to Group.
1. Particular sales of Designated Securities may be made from time to
time to the Underwriters of such Securities, for whom the firms designated as
representatives
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of the Underwriters of such Securities in the Pricing Agreement relating thereto
will act as representatives (the "Representatives"). The term "Representatives"
also refers to a single firm acting as sole representative of the Underwriters
and to an Underwriter or Underwriters who act without any firm being designated
as its or their representatives. This Underwriting Agreement shall not be
construed as an obligation of the Company to sell any of the Securities or as an
obligation of any of the Underwriters to purchase the Securities. The obligation
of the Company to issue and sell any of the Securities and the obligation of any
of the Underwriters to purchase any of the Securities shall be evidenced by the
Pricing Agreement with respect to the Designated Securities specified therein.
Each Pricing Agreement shall specify the aggregate principal amount of such
Designated Securities, the initial public offering price of such Designated
Securities, the purchase price to the Underwriters of such Designated
Securities, the names of the Underwriters of such Designated Securities, the
names of the Representatives of such Underwriters and the principal amount of
such Designated Securities to be purchased by each Underwriter and shall set
forth the date, time and manner of delivery of such Designated Securities and
payment therefor. The Pricing Agreement shall also specify (to the extent not
set forth in the Indenture and the registration statement and prospectus with
respect thereto) the terms of such Designated Securities. A Pricing Agreement
shall be in the form of an executed writing (which may be in counterparts), and
may be evidenced by an exchange of telegraphic communications or any other rapid
transmission device designed to produce a written record of communications
transmitted. The obligations of the Underwriters under this Agreement and each
Pricing Agreement shall be several and not joint.
2. The Company represents and warrants to, and agrees with, each of the
Underwriters that:
(a) A registration statement on Form S-3 (File No. 333-36178)
and two registration statements on Form S-1 (File Nos. 333-30288 and
333-75321) (the "Initial Registration Statements") in respect of the
Securities have been filed with the Securities and Exchange Commission
(the "Commission"); the Initial Registration Statements and any
post-effective amendments thereto, each in the form heretofore
delivered to the Representatives and, excluding exhibits to the Initial
Registration Statements, but including all documents incorporated by
reference in the prospectus contained in the latest Initial
Registration Statement, to the Representatives for each of the other
Underwriters, have been declared effective by the Commission in such
form; other than a registration statement, if any, increasing the size
of the offering (a "Rule 462(b) Registration Statement"), filed
pursuant to Rule 462(b) under the Securities Act of 1933, as amended
(the "Act"), which became or will become effective upon filing, no
other document with respect to the Initial Registration Statements or
document incorporated by reference therein has heretofore been filed or
transmitted for filing with the Commission (other than prospectuses
filed pursuant to Rule 424(b) of the rules and regulations of the
Commission under the Act, each in the form heretofore delivered to the
Representatives); and no stop order suspending the effectiveness of any
Initial Registration Statement, any post-effective amendment thereto or
the Rule 462(b) Registration Statement, if any, has been issued and no
proceeding for that purpose has been initiated or threatened by the
Commission (any preliminary prospectus included in the Initial
Registration Statements or filed with the Commission pursuant to Rule
424(a) under the Act is hereinafter called a "Preliminary Prospectus";
the various parts of the Initial Registration Statements, any
post-effective amendments thereto and the Rule 462(b) Registration
Statement, if any, including all exhibits thereto and the documents
incorporated by reference in the prospectus contained in the latest
Initial Registration Statement at the time such part of the latest
Initial Registration Statement
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became effective but excluding all Forms T-1, each as amended at the
time such part of the Initial Registration Statements became effective
or such part of the Rule 462(b) Registration Statement, if any, became
or hereafter becomes effective, are hereinafter collectively called the
"Registration Statement"; the prospectus relating to the Securities, in
the form in which it has most recently been filed, or transmitted for
filing, with the Commission on or prior to the date of this Agreement
is hereinafter called the "Prospectus"; any reference herein to any
Preliminary Prospectus or the Prospectus shall be deemed to refer to
and include the documents incorporated by reference therein pursuant to
the applicable form under the Act, as of the date of such Preliminary
Prospectus or Prospectus, as the case may be; any reference to any
amendment or supplement to any Preliminary Prospectus or the Prospectus
shall be deemed to refer to and include any documents filed after the
date of such Preliminary Prospectus or Prospectus, as the case may be,
under the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), and incorporated by reference in such Preliminary Prospectus or
Prospectus, as the case may be; any reference to any amendment to the
Initial Registration Statements shall be deemed to refer to and include
any annual report of the Company filed pursuant to Sections 13(a) or
15(d) of the Exchange Act after the effective date of the latest of the
Initial Registration Statements that is incorporated by reference in
the Registration Statement; and any reference to the Prospectus as
amended or supplemented shall be deemed to refer to the Prospectus as
amended or supplemented in relation to the applicable Designated
Securities in the form in which it is filed, or transmitted for filing,
with the Commission pursuant to Rule 424(b) under the Act in accordance
with Section 5(a) hereof, including any documents incorporated by
reference therein as of the date of such filing);
(b) The documents incorporated by reference in the Prospectus as
amended or supplemented, when they became effective or were filed with
the Commission, as the case may be, conformed in all material respects
to the requirements of the Act or the Exchange Act, as applicable, and
the rules and regulations of the Commission thereunder, and none of
such documents contained an untrue statement of a material fact or
omitted to state a material fact required to be stated therein or
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; and any
further documents so filed and incorporated by reference in the
Prospectus or any further amendment or supplement thereto, when such
documents become effective or are filed with the Commission, as the
case may be, will conform in all material respects to the requirements
of the Act or the Exchange Act, as applicable, and the rules and
regulations of the Commission thereunder and will not contain an untrue
statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein, in
the light of the circumstances under which they are made, not
misleading; provided, however, that this representation and warranty
shall not apply to any statements or omissions made in reliance upon
and in conformity with information furnished in writing to the Company
by an Underwriter of Designated Securities through the Representatives
expressly for use in the Prospectus as amended or supplemented relating
to such Securities;
(c) The Registration Statement and the Prospectus conform, and
any further amendments or supplements to the Registration Statement or
the Prospectus will conform, in all material respects to the
requirements of the Act and the Trust Indenture Act of 1939, as amended
(the "Trust Indenture Act"), as applicable, and the rules and
regulations of the Commission thereunder and do not and will not, as of
the applicable
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effective date as to the Registration Statement and any amendment
thereto and as of the applicable filing date as to the Prospectus and
any amendment or supplement thereto, 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;
provided, however, that this representation and warranty shall not
apply to any statements or omissions made in reliance upon and in
conformity with information furnished in writing to the Company by an
Underwriter of Designated Securities through the Representatives
expressly for use in the Prospectus as amended or supplemented relating
to such Securities;
(d) Neither the Company nor any of its subsidiaries that are
listed in the Company's latest annual report on Form 10-K pursuant to
the requirements of Form 10-K and Item 601(b)(21) of the Commission's
Regulation S-K (the "Significant Subsidiaries") has sustained since the
date of the latest audited financial statements included or
incorporated by reference in the Prospectus as amended or supplemented
any material 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 court or governmental action,
order or decree, otherwise than as set forth or contemplated in the
Prospectus; and, since the respective dates as of which information is
given in the Registration Statement and the Prospectus, there has not
been any material adverse change in the capital stock or long-term debt
of the Company or any of its subsidiaries or any material adverse
change, or any development involving a prospective material adverse
change, in or affecting the general affairs, management, financial
position, stockholders' equity or results of operations of the Company
and its subsidiaries, otherwise than as set forth or contemplated in
the Prospectus;
(e) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State
of Delaware, with power and authority (corporate and other) to own its
properties and conduct its business as described in the Prospectus;
(f) The Company has an authorized capitalization as set forth in
the Prospectus, all of the issued shares of capital stock of the
Company have been duly and validly authorized and issued and are fully
paid and non-assessable;
(g) The Securities have been duly authorized, and, when
Designated Securities are issued and delivered pursuant to this
Agreement and the Pricing Agreement with respect to such Designated
Securities, such Designated Securities will have been duly executed,
authenticated, issued and delivered and will constitute valid and
legally binding obligations of the Company entitled to the benefits
provided by the indenture, dated as of May 19, 1999 (the "Indenture"),
between the Company and The Bank of New York, as Trustee (including any
successor trustee, the "Trustee"); the Indenture has been duly
authorized and duly qualified under the Trust Indenture Act and, at the
Time of Delivery for such Designated Securities (as defined in Section
4 hereof), will constitute a valid and legally binding instrument,
enforceable in accordance with its terms, subject, as to enforcement,
to bankruptcy, insolvency, reorganization and other laws of general
applicability relating to or affecting creditors' rights and to general
equity principles; and the Indenture conforms, and the Designated
Securities will conform, to the descriptions thereof contained in the
Prospectus as amended or supplemented with respect to such Designated
Securities;
(h) The issue and sale of the Securities, the compliance by the
Company with all of the provisions of the Securities, the Indenture,
this Agreement and any Pricing
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Agreement and the consummation of the transactions herein and therein
contemplated will not conflict with or result in a breach or violation
of any of the terms or provisions of, or constitute a default under,
any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which the Company is a party or by which the
Company is bound or to which any of the property or assets of the
Company is subject, nor will such action result in any violation of the
provisions of the amended certificate of incorporation or by-laws of
the Company or any statute or any order, rule or regulation of any
court or governmental agency or body having jurisdiction over the
Company or any of its properties; and no consent, approval,
authorization, order, registration or qualification of or with any such
court or governmental agency or body is required for the issue and sale
of the Securities by the Company or the consummation by the Company of
the transactions contemplated by this Agreement or any Pricing
Agreement or the Indenture, except such as have been, or will have been
prior to the Time of Delivery, obtained under the Act and the Trust
Indenture Act and such consents, approvals, authorizations,
registrations or qualifications as may be required under state
securities or Blue Sky laws in connection with the purchase and
distribution of the Securities by the Underwriters;
(i) The statements set forth in the Prospectus under the
captions "Description of Debt Securities We May Offer", "Considerations
Relating to Securities Issued in Bearer Form" and "Legal Ownership and
Book-Entry Issuance", insofar as they purport to constitute a summary
of the terms of the Securities, and under the captions "United States
Taxation" and "Plan of Distribution", insofar as they purport to
describe the provisions of the laws and documents referred to therein,
are accurate, complete and fair;
(j) Neither the Company nor any of its Significant Subsidiaries
is in violation of its organizational documents or in default in the
performance or observance of any material obligation, agreement,
covenant or condition contained in any indenture, mortgage, deed of
trust, loan agreement, lease or other agreement or instrument to which
it is a party or by which it or any of its properties may be bound;
(k) Other than as set forth in the Prospectus, there are no
legal or governmental proceedings pending to which the Company or any
of its subsidiaries is a party or of which any property of the Company
or any of its subsidiaries is the subject which, if determined
adversely to the Company or any of its subsidiaries, would individually
or in the aggregate have a material adverse effect on the current or
future consolidated financial position, stockholders' equity or results
of operations of the Company and its subsidiaries; and, to the best of
the Company's knowledge, no such proceedings are threatened or
contemplated by governmental authorities or threatened by others;
(l) The Company is not and, after giving effect to the offering
and sale of the Securities, will not be an "investment company", as
such term is defined in the Investment Company Act of 1940, as amended
(the "Investment Company Act");
(m) The Company and its Significant Subsidiaries possess all
authorizations issued by the appropriate Federal, state and foreign
governments, governmental or regulatory authorities, self-regulatory
organizations and all courts or other tribunals, and are members in
good standing of each Federal, state or foreign exchange, board of
trade, clearing house or association and self-regulatory or similar
organization necessary to conduct their respective businesses as
described in the Prospectus, except as would not, individually or in
the aggregate, have a material adverse effect on
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the prospects, financial position, stockholders' equity or results of
operations of the Company and its subsidiaries, taken as a whole; and
(n) PricewaterhouseCoopers LLP, who have certified certain
financial statements of the Company and its subsidiaries, are
independent public accountants as required by the Act and the rules and
regulations of the Commission thereunder.
3. Upon the execution of the Pricing Agreement applicable to any
Designated Securities and authorization by the Representatives of the release of
such Designated Securities, the several Underwriters propose to offer such
Designated Securities for sale upon the terms and conditions set forth in the
Prospectus as amended or supplemented.
4. Designated Securities to be purchased by each Underwriter pursuant
to the Pricing Agreement relating thereto, in the form specified in such Pricing
Agreement, and in such authorized denominations and registered in such names as
the Representatives may request upon at least forty-eight hours' prior notice to
the Company, shall be delivered by or on behalf of the Company to Goldman, Sachs
& Co., for the account of such Underwriter, against payment by such Underwriter
or on its behalf of the purchase price therefor by wire transfer of Federal
(same-day) funds to the account specified by the Company to Goldman, Sachs & Co.
at least forty-eight hours in advance or at such other place and time and date
as the Representatives and the Company may agree upon in writing, such time and
date being herein called the "Time of Delivery" for such Securities.
5. The Company agrees with each of the Underwriters of any Designated
Securities:
(a) To prepare the Prospectus as amended or supplemented in
relation to the applicable Designated Securities in a form approved by
the Representatives and to file such Prospectus pursuant to Rule 424(b)
under the Act not later than the Commission's close of business on the
second business day following the execution and delivery of the Pricing
Agreement relating to the applicable Designated Securities or, if
applicable, such earlier time as may be required by Rule 424(b); to
make no further amendment or any supplement to the Registration
Statement or Prospectus as amended or supplemented after the date of
the Pricing Agreement relating to such Securities and prior to the Time
of Delivery for such Securities which shall be disapproved by the
Representatives for such Securities promptly after reasonable notice
thereof; to advise the Representatives, promptly after it receives
notice thereof, of any such amendment or supplement after such Time of
Delivery and furnish the Representatives with copies thereof; to file
promptly all reports and any definitive proxy or information statements
required to be filed by the Company with the Commission pursuant to
Section 13(a), 13(c), 14 or 15(d) of the Exchange Act for so long as
the delivery of a prospectus is required in connection with the
offering or sale of such Securities (including, in the case of Goldman,
Sachs & Co., in any Secondary Market Transactions during the Secondary
Transactions Period as defined in Section 5A hereof), and during such
same period to advise the Representatives, promptly after it receives
notice thereof, of the time when any amendment to the Registration
Statement has been filed or becomes effective or any supplement to the
Prospectus or any amended Prospectus has been filed with the
Commission, of the issuance by the Commission of any stop order or of
any order preventing or suspending the use of any prospectus relating
to the Securities, of the suspension of the qualification of such
Securities for offering or sale in any jurisdiction, of the initiation
or threatening of any proceeding for any such purpose, or of any
request by the Commission for the amending or supplementing of the
Registration Statement or Prospectus or for additional information;
and, in the event of the issuance of any such stop order or of any such
order preventing or suspending the use of any
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prospectus relating to the Securities or suspending any such
qualification, to promptly use its best efforts to obtain the
withdrawal of such order;
(b) Promptly from time to time to take such action as the
Representatives may reasonably request to qualify such Securities for
offering and sale under the securities laws of such jurisdictions as
the Representatives may request and to comply with such laws so as to
permit the continuance of sales and dealings therein in such
jurisdictions for as long as may be necessary to complete the
distribution of such Securities (including, in the case of Goldman,
Sachs & Co., in any Secondary Market Transactions during the Secondary
Transactions Period), provided that in connection therewith the Company
shall not be required to qualify as a foreign corporation or to file a
general consent to service of process in any jurisdiction;
(c) Prior to 10:00 a.m., New York City time, on the New York
Business Day next succeeding the date of this Agreement and from time
to time, to furnish the Underwriters in New York City with copies of
the Prospectus as amended or supplemented in such quantities as the
Representatives may reasonably request, and, if the delivery of a
prospectus is required at any time in connection with the offering or
sale of the Securities (including, in the case of Goldman, Sachs & Co.,
in any Secondary Market Transactions during the Secondary Transactions
Period) and if at such time any event shall have occurred as a result
of which the Prospectus as then amended or supplemented would include
an untrue statement of a material fact or omit to state any material
fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made when such Prospectus is
delivered, not misleading, or, if for any other reason it shall be
necessary during such same period to amend or supplement the
Prospectus, to notify the Representatives and upon their request to
file such document and to prepare and furnish without charge to each
Underwriter and to any dealer in securities as many copies as the
Representatives may from time to time reasonably request of an amended
Prospectus or a supplement to the Prospectus which will correct such
statement or omission or effect such compliance; provided, however,
that the Company may elect, upon notice to Goldman, Sachs & Co., not to
comply with this paragraph (d) with respect to any Secondary Market
Transaction, but only for a period or periods that the Company
reasonably determines are necessary in order to avoid premature
disclosure of material, non-public information, unless, notwithstanding
such election, such disclosure would otherwise be required under this
Agreement; and provided, further, that no such period or periods
described in the preceding proviso shall exceed 90 days in the
aggregate during any period of 12 consecutive calendar months. Upon
receipt of any such notice, Goldman, Sachs & Co. shall cease using the
Prospectus or any amendment or supplement thereto in connection with
Secondary Market Transactions until it receives notice from the Company
that it may resume using such document (or such document as it may be
amended or supplemented);
(d) To make generally available to its securityholders as soon
as practicable, but in any event not later than eighteen months after
the effective date of the Registration Statement (as defined in Rule
158(c) under the Act), an earnings statement of the Company and its
subsidiaries (which need not be audited) complying with Section 11(a)
of the Act and the rules and regulations of the Commission thereunder
(including, at the option of the Company, Rule 158 under the Act);
(e) During the period beginning from the date of the Pricing
Agreement for such Designated Securities and continuing to and
including the later of (i) the termination of
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trading restrictions for such Designated Securities, as notified to the
Company by the Representatives and (ii) the Time of Delivery for such
Designated Securities, not to offer, sell, contract to sell or
otherwise dispose of any debt securities of the Company which mature
more than one year after such Time of Delivery and which are
substantially similar to such Designated Securities, without the prior
written consent of Goldman, Sachs & Co.; and
(f) If the Company elects to rely upon Rule 462(b) under the
Act, to file a Rule 462(b) Registration Statement with the Commission
in compliance with Rule 462(b) by 10:00 P.M., Washington, D.C. time, on
the date of this Agreement and, at the time of filing, either pay to
the Commission the filing fee for the Rule 462(b) Registration
Statement or give irrevocable instructions for the payment of such fee
pursuant to Rule 111(b) under the Act.
For purposes of this Section 5, "New York Business Day" shall mean each Monday,
Tuesday, Wednesday, Thursday and Friday that is not a day on which banking
institutions in New York City are generally authorized or obligated by law or
executive order to close.
5A. The Company agrees with Goldman, Sachs & Co., with respect
to each issuance of Designated Securities:
(a) To make no amendment or supplement to the Registration
Statement or the Prospectus during the Secondary Transactions Period which shall
be disapproved by Goldman, Sachs & Co. promptly after reasonable notice thereof.
The "Secondary Transactions Period" means, with respect to any particular
issuance of Designated Securities, the period beginning on the date of the
Pricing Agreement relating to such Designated Securities and continuing for as
long as may be required under applicable law, in the reasonable judgment of
Goldman, Sachs & Co. after consultation with the Company, in order to offer and
sell any such Designated Securities in Secondary Market Transactions as
contemplated by the Prospectus as amended or supplemented with respect to such
Designated Securities;
(b) During the Secondary Transactions Period, to furnish to
Goldman, Sachs & Co. copies of all reports or other communications (financial or
other) furnished to stockholders generally, and to deliver to Goldman, Sachs &
Co. (i) as soon as they are available, copies of any reports and financial
statements furnished to or filed with the Commission or any national securities
exchange on which the Securities or any class of securities of the Company is
listed; and (ii) such additional information concerning the business and
financial condition of the Company as Goldman, Sachs & Co. may from time to time
reasonably request (such financial statements to be on a consolidated basis to
the extent the accounts of the Company and its subsidiaries are consolidated in
reports furnished to its stockholders generally or to the Commission); and
(c) Each time the Registration Statement or the Prospectus shall
be amended or supplemented during the Secondary Transactions Period, to furnish
or cause to be furnished to Goldman, Sachs & Co., upon its request, written
opinions of counsel for the Company, a letter from the independent accountants
who have certified the financial statements included in the Registration
Statement as then amended and certificates of officers of the Company, in each
case in form and substance reasonably satisfactory to Goldman, Sachs & Co., all
to the effect specified in subsections (c), (d) and (i), respectively, of
Section 7 hereof (as modified to relate to the Registration Statement and the
Prospectus as then amended or supplemented).
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Notwithstanding the foregoing provisions, the Company may elect, upon notice to
Goldman, Sachs & Co., not to comply with this Section 5A with respect to any
Secondary Market Transaction, but only for a period or periods that the Company
reasonably determines are necessary in order to avoid premature disclosure of
material, non-public information, unless, notwithstanding such election, such
disclosure would otherwise be required under this Agreement; and provided,
further, that no such period or periods described in the preceding proviso shall
exceed 90 days in the aggregate during any period of 12 consecutive calendar
months. Upon receipt of any such notice, Goldman, Sachs & Co. shall cease using
the Prospectus or any amendment or supplement thereto in connection with
Secondary Market Transactions until it receives notice from the Company that it
may resume using such document (or such document as it may be amended or
supplemented).
6. The Company covenants and agrees with the several Underwriters that
the Company will pay or cause to be paid the following: (i) the fees,
disbursements and expenses of the Company's counsel and accountants in
connection with the registration of the Securities under the Act and all other
expenses in connection with the preparation, printing and filing of the
Registration Statement, any Preliminary Prospectus and the Prospectus and
amendments and supplements thereto and the mailing and delivering of copies
thereof to the Underwriters and dealers; (ii) the cost of printing or producing
any Agreement among Underwriters, this Agreement, any Pricing Agreement, any
Indenture, any Blue Sky and legal investment memoranda, closing documents
(including any compilations thereof) and any other documents in connection with
the offering, purchase, sale and delivery of the Securities; (iii) all expenses
in connection with the qualification of the Securities for offering and sale
under state securities laws as provided in Section 5(b) hereof, including the
fees and disbursements of counsel for the Underwriters in connection with such
qualification and in connection with the Blue Sky and legal investment
memoranda; (iv) any fees charged by securities rating services for rating the
Securities; (v) any filing fees incident to, and the fees and disbursements of
counsel for the Underwriters in connection with, any required review by the
National Association of Securities Dealers, Inc. of the terms of the sale of the
Securities; (vi) the cost of preparing the Securities; (vii) the fees and
expenses of the Trustee and any agent of the Trustee and the fees and
disbursements of counsel for the Trustee in connection with the Indenture and
the Securities; and (viii) all other costs and expenses incident to the
performance of its obligations hereunder which are not otherwise specifically
provided for in this Section. It is understood, however, that, except as
provided in this Section, and Sections 8 and 11 hereof, the Underwriters will
pay all of their own costs and expenses, including the fees of their counsel,
transfer taxes on resale of any of the Securities by them, and any advertising
expenses connected with any offers they may make.
7. The obligations of the Underwriters of any Designated Securities
under the Pricing Agreement relating to such Designated Securities shall be
subject, in your discretion, to the condition that all representations and
warranties and other statements of the Company in or incorporated by reference
in the Pricing Agreement relating to such Designated Securities are, at and as
of the Time of Delivery for such Designated Securities, true and correct; the
condition that the Company shall have performed all of its obligations hereunder
theretofore to be performed; and the following additional conditions:
(a) The Prospectus as amended or supplemented in relation to the
applicable Designated Securities shall have been filed with the
Commission pursuant to Rule 424(b) within the applicable time period
prescribed for such filing by the rules and regulations under the Act
and in accordance with Section 5(a) hereof; if the Company has elected
to rely upon Rule 462(b), the Rule 462(b) Registration Statement shall
have become effective by 10:00 P.M., Washington, D.C. time, on the date
of this
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Agreement; no stop order suspending the effectiveness of the
Registration Statement or any part thereof shall have been issued and
no proceeding for that purpose shall have been initiated or threatened
by the Commission; and all requests for additional information on the
part of the Commission shall have been complied with to your reasonable
satisfaction;
(b) Counsel for the Underwriters shall have furnished to you
such written opinion and letter, dated the Time of Delivery for such
Designated Securities, to the effect set forth in this subsection
(b),as well as with respect to such other related matters as the
Representatives may reasonably request, and such counsel shall have
received such papers and information as they may reasonably request to
enable them to pass upon such matters:
(i) The Company has been duly incorporated and is an
existing corporation in good standing under the laws of the
State of Delaware;
(ii) All issued and outstanding shares of common stock of
the Company have been duly authorized and validly issued and are
fully paid and non-assessable;
(iii) All regulatory consents, authorizations, approvals
and filings required to be obtained or made by the Company under
the Federal laws of the United States, the laws of the State of
New York and the General Corporation Law of the State of
Delaware for the issuance, sale and delivery of the Designated
Securities by the Company to the Underwriters have been obtained
or made;
(iv) The issuance of the Designated Securities in
accordance with the Indenture and the sale of the Designated
Securities by the Company to the Underwriters pursuant to this
Agreement do not, and the performance by the Company of its
obligations under the Designated Securities, the Indenture, this
Agreement and the Pricing Agreement with respect to the
Designated Securities and the consummation of the transactions
herein and therein contemplated will not, (a) violate the
certificate of incorporation or by-laws of the Company, (b)
result in a default under or breach of the agreements specified
by you and filed as exhibits, pursuant to Items 601(b)(2)
through 601(b)(10) of the Commission's Regulation S-K, to the
Company's latest annual report on Form 10-K and any document
subsequently filed by the Company pursuant to Section 13(a),
13(c), 14 or 15(d) of the Exchange Act, (c) violate any court
orders listed in the certificate of a General Counsel of the
Company, dated the Time of Delivery and delivered to the
Representatives in connection with the offering of the
Securities or (d) violate any Federal law of the United States
or law of the State of New York applicable to the Company;
provided, however, that for the purposes of this paragraph (iv),
such counsel may state that they express no opinion with respect
to Federal or state securities laws, fraudulent transfer laws,
other antifraud laws and the Employee Retirement Income Security
Act of 1974, as amended ("ERISA") and related laws; and
provided, further, that such counsel may also state that insofar
as performance by the Company of its obligations under this
Agreement, the Indenture, the Designated Securities and the
Pricing Agreement with respect to the Designated Securities is
concerned, they are expressing no opinion as to bankruptcy,
insolvency, reorganization, moratorium or similar laws of
general applicability relating to or affecting creditors'
rights;
(v) This Agreement has been duly authorized, executed
and delivered by the Company;
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<PAGE> 11
(vi) The Indenture has been duly authorized, executed and
delivered by the Company and duly qualified under the Trust
Indenture Act; the Designated Securities have been duly
authorized, executed, authenticated, issued and delivered; and
the Indenture and the Securities constitute valid and legally
binding obligations of the Company enforceable in accordance
with their terms, subject to bankruptcy, insolvency,
reorganization and other laws of general applicability relating
to or affecting creditors' rights and to general equity
principles; and
(vii) The Company is not, and after giving effect to the
offering and sale of the Securities will not be, an "investment
company" as such term is defined in the Investment Company Act.
In rendering such opinion, such counsel may state that they
express no opinion as to the laws of any jurisdiction other than the
Federal laws of the United States, the laws of the State of New York
and the General Corporation Law of the State of Delaware; that, insofar
as such opinion involves factual matters, they have relied upon
certificates of officers of the Company and its subsidiaries and
certificates of public officials and other sources believed by such
counsel to be responsible; and that such counsel have assumed that the
Indenture has been duly authorized, executed and delivered by the
Trustee, that the Securities conform to the form thereof examined by
them, that the Trustee's certificates of authentication of the
Securities have been manually signed by one of the Trustee's authorized
signatories and that the signatures on all documents examined by them
are genuine (assumptions that they have not independently verified).
Such counsel shall also furnish the Representatives with a
letter to the effect that, as counsel to the Company, they reviewed the
Registration Statement and the Prospectus as amended or supplemented,
participated in discussions with representatives of the Underwriters
and those of the Company and its accountants and advised the Company as
to the requirements of the Act and the applicable rules and regulations
thereunder; between the date of the Prospectus as amended or
supplemented and the Time of Delivery of the Designated Securities,
such counsel participated in further discussions with representatives
of the Underwriters and those of the Company and its accountants in
which the contents of certain portions of the Prospectus as amended or
supplemented and related matters were discussed and reviewed certain
certificates of certain officers of the Company, an opinion of a
General Counsel of the Company and letters from the Company's
independent accountants delivered to the Representatives in connection
with the initial offering of the Designated Securities; on the basis of
the information that such counsel gained in the course of the
performance of the services referred to above, considered in the light
of such counsel's understanding of the applicable law and the
experience such counsel have gained through their practice under the
Act, they will confirm to the Representatives that, in such counsel's
opinion, the Registration Statement, as of its effective date, and the
Prospectus as amended or supplemented, as of its date, appeared on
their face to be appropriately responsive in all material respects to
the requirements of the Act and the Trust Indenture Act and the
applicable rules and regulations of the Commission thereunder; nothing
that came to such counsel's attention in the course of such review has
caused such counsel to believe that 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 to make the statements therein not misleading; nothing that
came to the attention of such counsel in the course of the procedures
described in the second clause of this paragraph has caused such
counsel
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<PAGE> 12
to believe that the Prospectus as amended or supplemented, as of its
date or (together with any further amendments and supplements thereto
made by the Company prior to the Time of Delivery of the Designated
Securities) as of the Time of Delivery of the Designated Securities,
contained or contains any untrue statement of a material fact or
omitted 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; such counsel may state that the
limitations inherent in the independent verification of factual matters
and the character of determinations involved in the registration
process are such, however, that such counsel does not assume any
responsibility for the accuracy, completeness or fairness of the
statements contained in the Registration Statement or the Prospectus as
amended or supplemented except for those made under certain captions in
the Prospectus relating to the Designated Securities and related
matters specified by the Representatives; such counsel need express no
opinion or belief as to the financial statements or other financial
data derived from accounting records contained in the Registration
Statement or the Prospectus as amended and supplemented, or as to the
statement of the eligibility of the Trustee under the Indenture; and
such counsel may assume that any Rule 462(b) Registration Statement was
filed with the Commission prior to the time that any confirmations of
the sale of any of the Securities were sent or given to investors. In
addition, such counsel shall state that they do not know of any
litigation instituted or threatened against the Company that would be
required to be disclosed in the Prospectus as amended or supplemented
that is not so disclosed, provided that such counsel may also state
that they call to the attention of the Representatives that the Company
has an internal legal department and that, while such counsel
represents the Company and its affiliates on a regular basis, such
counsel's engagement has been limited to specific matters as to which
it was consulted and, accordingly, such counsel's knowledge with
respect to litigation instituted or threatened against the Company is
limited; and that they do not know of any documents that are required
to be filed as exhibits to the Registration Statement that are not so
filed.
(c) A General Counsel for the Company shall have furnished to
the Representatives his written opinion, dated the Time of Delivery for
such Designated Securities, in form and substance satisfactory to the
Representatives, to the effect that:
(i) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the
State of Delaware, with corporate power and authority to own its
properties and conduct its business as described in the
Prospectus as amended or supplemented;
(ii) The Company has an authorized capitalization as set
forth in the Prospectus as amended or supplemented, and all of
the issued shares of capital stock of the Company have been duly
and validly authorized and issued and are fully paid and
non-assessable;
(iii) To the best of such counsel's knowledge and other
than as set forth in the Prospectus as amended or supplemented,
there are no legal or governmental proceedings pending to which
the Company or any of its subsidiaries is a party or of which
any property of the Company or any of its subsidiaries is the
subject that is reasonably likely, individually or in the
aggregate, to have a material adverse effect on the current or
future consolidated financial position, stockholders' equity or
results of operations of the Company and its subsidiaries; and,
to the best of such counsel's knowledge, no such proceedings are
threatened or contemplated by governmental authorities or
threatened by others;
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<PAGE> 13
(iv) This Agreement has been duly authorized, executed
and delivered by the Company;
(v) The Designated Securities have been duly authorized,
executed, authenticated, issued and delivered and constitute
valid and legally binding obligations of the Company entitled to
the benefits provided by the Indenture, subject to bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium and
similar laws of general applicability relating to or affecting
creditors' rights and to general equity principles; and the
Designated Securities and the Indenture conform in all material
respects to the descriptions thereof in the Prospectus as
amended or supplemented;
(vi) The Indenture has been duly authorized, executed and
delivered by the Company and constitutes a valid and legally
binding agreement of the Company enforceable in accordance with
its terms, subject to bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights and to
general equity principles; and the Indenture has been duly
qualified under the Trust Indenture Act;
(vii) The issue and sale of the Designated Securities by
the Company, the compliance by the Company with all of the
provisions of the Designated Securities, the Indenture, this
Agreement and the Pricing Agreement with respect to the
Designated Securities and the consummation by the Company of the
transactions herein and therein contemplated will not conflict
with or result in a breach or violation of any of the terms or
provisions of, or constitute a default under, any material
indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument known to such counsel to which the
Company is a party or by which the Company is bound or to which
any of the property or assets of the Company is subject, nor
will such action result in any violation of the provisions of
the certificate of incorporation or by-laws of the Company, any
statute or any order, rule or regulation known to such counsel
of any court or governmental agency or body having jurisdiction
over the Company or any of its properties; provided, however,
that, for the purposes of this paragraph (vii), such counsel
need not express any opinion with respect to Federal or state
securities laws, fraudulent transfer laws, other antifraud laws
and ERISA and related laws; and provided, further, that insofar
as the compliance by the Company with all of the provisions of
the Designated Securities, the Indenture, this Agreement and the
Pricing Agreement with respect to the Designated Securities and
the consummation of the transactions herein and therein
contemplated are concerned, such counsel need not express any
opinion as to bankruptcy, insolvency, reorganization, moratorium
and similar laws of general applicability relating to or
affecting creditors' rights;
(viii)No consent, approval, authorization, order,
registration or qualification of or with any court or
governmental agency or body of the United States of America or
the State of New York is required of the Company for the issue
and sale of the Designated Securities or the consummation by the
Company of the transactions contemplated by this Agreement, the
Indenture, the Designated Securities or the Pricing Agreement
with respect to the Designated Securities, except the
registration of the Designated Securities under the Act and the
qualification of the Indenture under the Trust Indenture Act,
each of which has
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<PAGE> 14
been obtained or made, and such consents, approvals, authorizations,
registrations or qualifications as may be required under state
securities or Blue Sky laws in connection with the purchase and
distribution of the Designated Securities by the Underwriters;
(ix) The statements set forth in the Prospectus as amended or
supplemented under certain captions therein relating to the Designated
Securities and related matters specified by the Representatives,
insofar as they purport to constitute a summary of the terms of the
Designated Securities, are accurate, complete and fair; and
(x) The Registration Statement and the Prospectus as amended
or supplemented and any further amendments and supplements thereto made
by the Company prior to the Time of Delivery of the Designated
Securities (other than the financial statements and related schedules
therein, other financial data therein derived from the Company's
accounting records and the statement of the eligibility of the Trustee
under the Indenture, as to which such counsel need not express any
opinion) comply as to form in all material respects with the
requirements of the Act and the Trust Indenture Act and the rules and
regulations thereunder; although he does not assume any responsibility
for the accuracy, completeness or fairness of the statements contained
in the Registration Statement or the Prospectus as amended or
supplemented, except for those referred to in the opinion in paragraph
(ix) of this Section 7(d), he has no reason to believe (i) that, as of
its effective date, the Registration Statement or any further amendment
thereto made by the Company prior to the Time of Delivery of the
Designated Securities (other than the financial statements and related
schedules therein, other financial data therein derived from the
Company's accounting records and the statement of the eligibility of
the Trustee under the Indenture, as to which such counsel need not
express any opinion) contained an untrue statement of a material fact
or omitted to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, (ii) that, as
of its date, the Prospectus as amended or supplemented or any further
amendment or supplement thereto made by the Company prior to the Time
of Delivery of the Designated Securities (other than the financial
statements and related schedules therein, other financial data therein
derived from the Company's accounting records and the statement of the
eligibility of the Trustee under the Indenture, as to which such
counsel need not express any opinion) contained an untrue statement of
a material fact or omitted to state a material fact necessary to make
the statements therein, in the light of the circumstances under which
they were made, not misleading or (iii) that, as of the Time of
Delivery of the Designated Securities, either the Registration
Statement or the Prospectus as amended or supplemented or any further
amendment or supplement thereto made by the Company prior to the Time
of Delivery of the Designated Securities (other than the financial
statements and related schedules therein, other financial data therein
derived from the Company's accounting records and the statement of the
eligibility of the Trustee under the Indenture, as to which such
counsel need not express any opinion) contains an untrue statement of a
material fact or omits to state a material fact necessary to make the
statements therein, in the light of the circumstances under which they
were made, not misleading; and he does not know of any amendment to the
Registration Statement required to be filed or of any contracts or
other documents of a character required to be filed as an exhibit
14
<PAGE> 15
to the Registration Statement or to any document incorporated by
reference into the Prospectus as amended or supplemented or required to
be so incorporated or to be described in the Registration Statement or
the Prospectus as amended or supplemented which are not filed,
incorporated by reference or described as required. Such counsel may
state that he assumes that any Rule 462(b) Registration Statement was
filed with the Commission prior to the time that any confirmations of
the sale of any of the Securities were sent or given to investors.
In rendering such opinion, such counsel may state that he expresses no
opinion as to the laws of any jurisdiction other than the Federal laws of the
United States, the laws of the State of New York and the General Corporation Law
of the State of Delaware; that, insofar as such opinion involves factual
matters, he has relied upon certificates of officers of the Company and its
subsidiaries and certificates of public officials and other sources believed by
such counsel to be responsible; and that he has assumed that the Indenture has
been duly authorized, executed and delivered by the Trustee, that the Designated
Securities conform to the form thereof examined by him (or members of the
Company's legal department acting under his supervision), that the Trustee's
certificates of authentication of the Designated Securities have been manually
signed by one of the Trustee's authorized signatories and that the signatures on
all documents examined by him (or members of the Company's legal department
acting under his supervision) are genuine (assumptions that he has not
independently verified). In addition, such counsel may state that he has
examined, or has caused members of the Company's legal department to examine,
such corporate and partnership records, certificates and other documents, and
such questions of law, as he has considered necessary or appropriate for the
purposes of such opinion;
(d) On the date of the Pricing Agreement for such Designated Securities
at a time prior to the execution of the Pricing Agreement with respect to such
Designated Securities and at the Time of Delivery for such Designated
Securities, PricewaterhouseCoopers LLP shall have furnished to the
Representatives a letter, dated the effective date of the Registration Statement
or the date of the most recent report filed with the Commission containing
financial statements and incorporated by reference in the Registration
Statement, if the date of such report is later than such effective date, and a
letter dated such Time of Delivery, respectively, to the effect set forth in
Annex II hereto, and with respect to such letter dated such Time of Delivery, as
to such other matters as the Representatives may reasonably request and in form
and substance satisfactory to the Representatives (the executed copy of the
letter delivered prior to the execution of this Agreement is attached as Annex
I(a) hereto and a draft of the form of letter to be delivered on the effective
date of any post-effective amendment to the Registration Statement and as of
each Time of Delivery is attached as Annex I(b) hereto);
(e) (i) Neither the Company nor any of its Significant Subsidiaries
shall have sustained since the date of the latest audited financial statements
included or incorporated by reference in the Prospectus as amended prior to the
date of the Pricing Agreement relating to the Designated Securities 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 court or
governmental action, order or decree, otherwise than as set forth or
contemplated in the Prospectus as amended prior to the date of the Pricing
Agreement relating to the Designated Securities, and (ii) since the respective
dates as of which information is given in the Prospectus as amended prior to the
date of the Pricing Agreement relating to the Designated Securities there shall
not
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<PAGE> 16
have been any change in the capital stock or partners' capital, as applicable,
or long-term debt of the Company or any of its Significant 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 than as set forth
or contemplated in the Prospectus as amended prior to the date of the Pricing
Agreement relating to the Designated Securities, the effect of which, in any
such case described in clause (i) or (ii), is in the judgment of Goldman, Sachs
& Co. so material and adverse as to make it impracticable or inadvisable to
proceed with the public offering or the delivery of the Designated Securities on
the terms and in the manner contemplated in the Prospectus as first amended or
supplemented relating to the Designated Securities;
(f) On or after the date of the Pricing Agreement relating to the
Designated Securities (i) no downgrading shall have occurred in the rating
accorded the Company's debt securities by any "nationally recognized statistical
rating organization", as that term is defined by the Commission for purposes of
Rule 436(g)(2) under the Act, 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;
(g) On or after the date of the Pricing Agreement relating to the
Designated Securities there shall not have occurred any of the following: (i) a
suspension or material limitation in trading in securities generally on the New
York Stock Exchange; (ii) a suspension or material limitation in trading in the
Company's securities on the New York Stock Exchange; (iii) a general moratorium
on commercial banking activities declared by either Federal or New York State
authorities; or (iv) the outbreak or escalation of hostilities involving the
United States or the declaration by the United States of a national emergency or
war, if the effect of any such event specified in this clause (iv) in the
judgment of Goldman, Sachs & Co. makes it impracticable or inadvisable to
proceed with the public offering or the delivery of the Designated Securities on
the terms and in the manner contemplated in the Prospectus as first amended or
supplemented relating to the Designated Securities;
(h) The Company shall have complied with the provisions of Section 5(c)
hereof with respect to the furnishing of prospectuses on the New York Business
Day next succeeding the date of this Agreement; and
(i) The Company shall have furnished or caused to be furnished to the
Representatives at the Time of Delivery for the Designated Securities a
certificate or certificates of officers of the Company satisfactory to the
Representatives as to the accuracy of the representations and warranties of the
Company herein at and as of such Time of Delivery, as to the performance by the
Company of all of its obligations hereunder to be performed at or prior to such
Time of Delivery, as to the matters set forth in subsections (a) and (e) of this
Section and as to such other matters as the Representatives may reasonably
request.
8. (a) The Company will indemnify and hold harmless each Underwriter of
Designated Securities against any losses, claims, damages or liabilities, joint
or several, to which such Underwriter may become subject, under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon an untrue statement or alleged
untrue statement of a material fact contained in any Preliminary Prospectus, any
preliminary prospectus supplement, the Registration Statement and the Prospectus
as amended or supplemented, or any
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<PAGE> 17
amendment or supplement thereto, or arise out of or are based upon the omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein, not misleading, and will
reimburse each such Underwriter for any legal or other expenses reasonably
incurred by such Underwriter in connection with investigating or defending any
such action or claim 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 or liability arises out of or is based upon an untrue statement or
alleged untrue statement or omission or alleged omission made in any Preliminary
Prospectus, any preliminary prospectus supplement, the Registration Statement
and the Prospectus as amended or supplemented, or any such amendment or
supplement in reliance upon and in conformity with written information furnished
to the Company by any Underwriter of Designated Securities through the
Representatives expressly for use in the Prospectus as amended or supplemented
relating to such Securities.
(b) Each Underwriter will indemnify and hold harmless the Company
against any losses, claims, damages or liabilities to which the Company may
become subject, under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are based
upon an untrue statement or alleged untrue statement of a material fact
contained in any Preliminary Prospectus, any preliminary prospectus supplement,
the Registration Statement, the Prospectus as amended or supplemented and any
other prospectus relating to the Securities, or any amendment or supplement
thereto, or arise out of or are based upon the omission or alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein, not misleading, in each case to the extent, but only to
the extent, that such untrue statement or alleged untrue statement or omission
or alleged omission was made in any Preliminary Prospectus, any preliminary
prospectus supplement, the Registration Statement, the Prospectus as amended or
supplemented and any other prospectus relating to the Securities, or any such
amendment or supplement in reliance upon and in conformity with written
information furnished to the Company by such Underwriter through the
Representatives expressly for use therein; and will reimburse the Company for
any legal or other expenses reasonably incurred by the Company in connection
with investigating or defending any such action or claim as such expenses are
incurred.
(c) Promptly after receipt by an indemnified party under subsection (a)
or (b) above of notice of the commencement of any action, such indemnified party
shall, if a claim in respect thereof is to be made against the indemnifying
party under such subsection, notify the indemnifying party in writing of the
commencement thereof; but the omission so to notify the indemnifying party shall
not relieve it from any liability which it may have to any indemnified party
otherwise than under such subsection. In case any such action shall be brought
against any indemnified party and it shall notify the indemnifying party of the
commencement thereof, the indemnifying party shall be entitled to participate
therein and, to the extent that it shall wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof, with
counsel satisfactory to such indemnified party (who shall not, except with the
consent of the indemnified party, be counsel to the indemnifying party), and,
after notice from the indemnifying party to such indemnified party of its
election so to assume the defense thereof, the indemnifying party shall not be
liable to such indemnified party under such subsection for any legal expenses of
other counsel or any other expenses, in each case subsequently incurred by such
indemnified party, in connection with the defense
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<PAGE> 18
thereof other than reasonable costs of investigation. No indemnifying party
shall, without the written consent of the indemnified party, effect the
settlement or compromise of, or consent to the entry of any judgment with
respect to, any pending or threatened action or claim in respect of which
indemnification or contribution may be sought hereunder (whether or not the
indemnified party is an actual or potential party to such action or claim)
unless such settlement, compromise or judgment (i) includes an unconditional
release of the indemnified party from all liability arising out of such action
or claim and (ii) does not include a statement as to or an admission of fault,
culpability or a failure to act, by or on behalf of any indemnified party.
(d) If the indemnification provided for in this Section 8 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities (or
actions in respect thereof) in such proportion as is appropriate to reflect the
relative benefits received by the Company on the one hand and the Underwriters
of the Designated Securities on the other from the offering of the Designated
Securities to which such loss, claim, damage or liability (or action in respect
thereof) relates. If, however, the allocation provided by the immediately
preceding sentence is not permitted by applicable law or if the indemnified
party failed to give the notice required under subsection (c) above, then each
indemnifying party shall contribute to such amount paid or payable by such
indemnified party in such proportion as is appropriate to reflect not only such
relative benefits but also the relative fault of the Company on the one hand and
the Underwriters of the Designated Securities on the other in connection with
the statements or omissions which resulted in such losses, claims, damages or
liabilities (or actions in respect thereof), as well as any other relevant
equitable considerations. The relative benefits received by the Company on the
one hand and such Underwriters on the other shall be deemed to be in the same
proportion as the total net proceeds from such offering (before deducting
expenses) received by the Company bear to the total underwriting discounts and
commissions received by such Underwriters. The relative fault shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the Company on the one hand
or such Underwriters on the other and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission. The Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this subsection (d) were determined by pro
rata allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take account of the
equitable considerations referred to above in this subsection (d). The amount
paid or payable by an indemnified party as a result of the losses, claims,
damages or liabilities (or actions in respect thereof) referred to above in this
subsection (d) shall be deemed to include any legal or other expenses reasonably
incurred by such indemnified party in connection with investigating or defending
any such action or claim. Notwithstanding the provisions of this subsection (d),
no Underwriter shall be required to contribute any amount in excess of the
amount by which the total price at which the applicable Designated Securities
underwritten by it and distributed to the public were offered to the public
exceeds the amount of any damages which such Underwriter has otherwise been
required to pay by reason of such untrue or alleged untrue statement or omission
or alleged omission. No person guilty of fraudulent misrepresentation (within
the
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<PAGE> 19
meaning of Section 11(f) of the Act) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation. The obligations
of the Underwriters of Designated Securities in this subsection (d) to
contribute are several in proportion to their respective underwriting
obligations with respect to such Securities and not joint.
(e) The obligations of the Company under this Section 8 shall be in
addition to any liability which the Company may otherwise have and shall extend,
upon the same terms and conditions, to each person, if any, who controls any
Underwriter within the meaning of the Act; and the obligations of the
Underwriters under this Section 8 shall be in addition to any liability which
the respective Underwriters may otherwise have and shall extend, upon the same
terms and conditions, to each officer and director of the Company and to each
person, if any, who controls the Company within the meaning of the Act.
9. (a) If any Underwriter shall default in its obligation to purchase
the Designated Securities which it has agreed to purchase under the Pricing
Agreement relating to such Designated Securities, the Representatives may in
their discretion arrange for themselves or another party or other parties to
purchase such Designated Securities on the terms contained herein. If within
thirty-six hours after such default by any Underwriter the Representatives do
not arrange for the purchase of such Designated Securities, then the Company
shall be entitled to a further period of thirty-six hours within which to
procure another party or other parties satisfactory to the Representatives to
purchase such Designated Securities on such terms. In the event that, within the
respective prescribed period, the Representatives notify the Company that they
have so arranged for the purchase of such Designated Securities, or the Company
notifies the Representatives that it has so arranged for the purchase of such
Designated Securities, the Representatives or the Company shall have the right
to postpone the Time of Delivery for such Designated Securities for a period of
not more than seven days, in order to effect whatever changes may thereby be
made necessary in the Registration Statement or the Prospectus as amended or
supplemented, or in any other documents or arrangements, and the Company agrees
to file promptly any amendments or supplements to the Registration Statement or
the Prospectus which in the opinion of the Representatives may thereby be made
necessary. The term "Underwriter" as used in this Agreement shall include any
person substituted under this Section with like effect as if such person had
originally been a party to the Pricing Agreement with respect to such Designated
Securities.
(b) If, after giving effect to any arrangements for the purchase of the
Designated Securities of a defaulting Underwriter or Underwriters by the
Representatives and the Company as provided in subsection (a) above, the
aggregate principal amount of such Designated Securities which remains
unpurchased does not exceed one-eleventh of the aggregate principal amount of
the Designated Securities, then the Company shall have the right to require each
non-defaulting Underwriter to purchase the principal amount of Designated
Securities which such Underwriter agreed to purchase under the Pricing Agreement
relating to such Designated Securities and, in addition, to require each
non-defaulting Underwriter to purchase its pro rata share (based on the
principal amount of Designated Securities which such Underwriter agreed to
purchase under such Pricing Agreement) of the Designated Securities of such
defaulting Underwriter or Underwriters for which such arrangements have not been
made; but nothing herein shall relieve a defaulting Underwriter from liability
for its default.
19
<PAGE> 20
(c) If, after giving effect to any arrangements for the purchase
of the Designated Securities of a defaulting Underwriter or
Underwriters by the Representatives and the Company as provided in
subsection (a) above, the aggregate principal amount of Designated
Securities which remains unpurchased exceeds one-eleventh of the
aggregate principal amount of the Designated Securities, as referred to
in subsection (b) above, or if the Company shall not exercise the right
described in subsection (b) above to require non-defaulting
Underwriters to purchase Designated Securities of a defaulting
Underwriter or Underwriters, then the Pricing Agreement relating to
such Designated Securities shall thereupon terminate, without liability
on the part of any non-defaulting Underwriter or the Company, except
for the expenses to be borne by the Company and the Underwriters as
provided in Section 6 hereof and the indemnity and contribution
agreements in Section 8 hereof; but nothing herein shall relieve a
defaulting Underwriter from liability for its default.
10. The respective indemnities, agreements, representations, warranties
and other statements of the Company and the several Underwriters, as set forth
in this Agreement or made by or on behalf of them, respectively, pursuant to
this Agreement, shall remain in full force and effect, regardless of any
investigation (or any statement as to the results thereof) made by or on behalf
of any Underwriter or any controlling person of any Underwriter, or the Company,
or any officer or director or controlling person of the Company, and shall
survive delivery of and payment for the Securities.
11. Anything herein to the contrary notwithstanding, the indemnity
agreement of the Company in subsection (a) of Section 8 hereof, the
representations and warranties in subsections (b) and (c) of Section 2 hereof
and any representation or warranty as to the accuracy of the Registration
Statement or any Prospectus contained in any certificate furnished by the
Company pursuant to Section 7 hereof, insofar as they may constitute a basis for
indemnification for liabilities (other than payment by the Company of expenses
incurred or paid in the successful defense of any action, suit or proceeding)
arising under the Act, shall not extend to the extent of any interest therein of
a controlling person or partner of an Underwriter who is a director or officer
of the Company who signed the Registration Statement or a controlling person of
the Company when the Registration Statement has become effective, except in each
case to the extent that an interest of such character shall have been determined
by a court of appropriate jurisdiction as not against public policy as expressed
in the Act. Unless in the opinion of counsel for the Company the matter has been
settled by controlling precedent, the Company will, if a claim for such
indemnification is asserted, submit to a court of appropriate jurisdiction the
question of whether such interest is against public policy as expressed in the
Act and will be governed by the final adjudication of such issue.
12. If any Pricing Agreement shall be terminated pursuant to Section 9
hereof, the Company shall not then be under any liability to any Underwriter
with respect to the Designated Securities covered by such Pricing Agreement
except as provided in Sections 6 and 8 hereof; but, if for any other reason
Designated Securities are not delivered by or on behalf of the Company as
provided herein, the Company will reimburse the Underwriters through you for all
out-of-pocket expenses approved in writing by you, including fees and
disbursements of counsel, reasonably incurred by the Underwriters in making
preparations for the purchase, sale and delivery of such Designated Securities,
but the Company shall then be under no further liability to any Underwriter with
respect to such Designated Securities except as provided in Sections 6 and 8
hereof.
13. In all dealings hereunder, the Representatives of the Underwriters
of Designated Securities shall act on behalf of each of such Underwriters, and
the parties hereto shall be entitled to act and rely upon any statement,
request, notice or agreement on behalf of any
20
<PAGE> 21
Underwriter made or given by such Representatives jointly, by Goldman, Sachs &
Co. on behalf of such Underwriters or by such of the Representatives, if any, as
may be designated for such purpose in the Pricing Agreement.
All statements, requests, notices and agreements hereunder shall be in
writing, and if to the Underwriters shall be delivered or sent by mail, telex or
facsimile transmission to the address of the Representatives as set forth in the
Pricing Agreement; and if to the Company shall be delivered or sent by mail,
telex or facsimile transmission to the address of the Company set forth in the
Registration Statement: Attention: Secretary; provided, however, that any notice
to an Underwriter pursuant to Section 8(c) hereof shall be delivered or sent by
mail, telex or facsimile transmission to such Underwriter at its address set
forth in its Underwriters' Questionnaire, or telex constituting such
Questionnaire, which address will be supplied to the Company by the
Representatives upon request. Any such statements, requests, notices or
agreements shall take effect upon receipt thereof.
14. This Agreement and each Pricing Agreement shall be binding upon,
and inure solely to the benefit of, the Underwriters, the Company and, to the
extent provided in Sections 8 and 10 hereof, the officers and directors of the
Company and each person who controls the Company or any Underwriter, and their
respective heirs, executors, administrators, successors and assigns, and no
other person shall acquire or have any right under or by virtue of this
Agreement or any such Pricing Agreement. No purchaser of any of the Securities
from any Underwriter shall be deemed a successor or assign by reason merely of
such purchase.
15. Time shall be of the essence of each Pricing Agreement. As used
herein, "business day" shall mean any day when the Commission's office in
Washington, D.C. is open for business.
16. THIS AGREEMENT AND EACH PRICING AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
17. This Agreement and each Pricing Agreement may be executed by any
one or more of the parties hereto and thereto in any number of counterparts,
each of which shall be deemed to be an original, but all such respective
counterparts shall together constitute one and the same instrument.
21
<PAGE> 22
If the foregoing is in accordance with your understanding, please sign
and return to us four counterparts hereof.
Very truly yours,
The Goldman Sachs Group, Inc.
By: /s/ Dan H. Jester
-----------------------------------
Name: Dan H. Jester
Title: Vice President and Treasurer
Accepted as of the date hereof:
Goldman, Sachs & Co.
/s/ Goldman, Sachs & Co.
-----------------------------------------
(Goldman, Sachs & Co.)
On behalf of each of the Underwriters
22
<PAGE> 23
ANNEX I
PRICING AGREEMENT
Goldman, Sachs & Co.,
As Representatives of the several
Underwriters named in Schedule I hereto,
85 Broad Street,
New York, New York 10004.
........... , 20..
Ladies and Gentlemen:
The Goldman Sachs Group, Inc., a Delaware corporation (the "Company"),
proposes, subject to the terms and conditions stated herein and in the
Underwriting Agreement, dated ............, 20.. (the "Underwriting Agreement"),
to issue and sell to the Underwriters named in Schedule I hereto (the
"Underwriters") the Securities specified in Schedule II hereto (the "Designated
Securities"). Each of the provisions of the Underwriting Agreement is
incorporated herein by reference in its entirety, and shall be deemed to be a
part of this Agreement to the same extent as if such provisions had been set
forth in full herein; and each of the representations and warranties set forth
therein shall be deemed to have been made at and as of the date of this Pricing
Agreement, except that each representation and warranty which refers to the
Prospectus in Section 2 of the Underwriting Agreement shall be deemed to be a
representation or warranty as of the date of the Underwriting Agreement in
relation to the Prospectus (as therein defined), and also a representation and
warranty as of the date of this Pricing Agreement in relation to the Prospectus
as amended or supplemented relating to the Designated Securities which are the
subject of this Pricing Agreement. Each reference to the Representatives herein
and in the provisions of the Underwriting Agreement so incorporated by reference
shall be deemed to refer to you. Unless otherwise defined herein, terms defined
in the Underwriting Agreement are used herein as therein defined. The
Representatives designated to act on behalf of the Representatives and on behalf
of each of the Underwriters of the Designated Securities pursuant to Section 13
of the Underwriting Agreement and the address of the Representatives referred to
in such Section 13 are set forth at the end of Schedule II hereto.
An amendment to the Registration Statement, or a supplement to the
Prospectus, as the case may be, relating to the Designated Securities, in the
form heretofore delivered to you is now proposed to be filed with the
Commission.
Subject to the terms and conditions set forth herein and in the
Underwriting Agreement incorporated herein by reference, the Company agrees to
issue and sell to each of the Underwriters, and each of the Underwriters agrees,
severally and not jointly, to purchase from the Company, at the time and place
and at the purchase price to the Underwriters set forth in Schedule II hereto,
the principal amount of Designated Securities set forth opposite the name of
such Underwriter in Schedule I hereto.
If the foregoing is in accordance with your understanding, please sign
and return to us ............... counterparts hereof, and upon acceptance hereof
by you, on behalf of each of the Underwriters, this letter and such acceptance
hereof, including the provisions of the Underwriting Agreement incorporated
herein by reference, shall constitute a binding agreement between each of the
Underwriters and the Company. It is understood that your acceptance of this
letter on behalf of each of the Underwriters is or will be pursuant to the
<PAGE> 24
authority set forth in a form of Agreement among Underwriters, the form of which
shall be submitted to the Company for examination upon request, but without
warranty on the part of the Representatives as to the authority of the signers
thereof.
Very truly yours,
The Goldman Sachs Group, Inc.
By:
-----------------------------------
Name:
Title:
Accepted as of the date hereof:
Goldman, Sachs & Co.
---------------------------------------
(Goldman, Sachs & Co.)
On behalf of each of the Underwriters
2
<PAGE> 25
SCHEDULE I
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT OF
DESIGNATED
SECURITIES
TO BE
UNDERWRITER PURCHASED
<S> <C>
Goldman, Sachs & Co......................................... $
[Names of other Underwriters]...............................
-----------
Total............................................. $
===========
</TABLE>
3
<PAGE> 26
SCHEDULE II
TITLE OF DESIGNATED SECURITIES:
[ %] [Floating Rate] [Zero Coupon] [Notes]
[Debentures] due ,
AGGREGATE PRINCIPAL AMOUNT:
[$]
PRICE TO PUBLIC:
% of the principal amount of the Designated Securities, plus accrued
interest[, if any,] from to [and accrued
amortization[, if any,] from to ]
PURCHASE PRICE BY UNDERWRITERS:
% of the principal amount of the Designated Securities, plus accrued
interest from to [and accrued amortization[, if any,]
from to ]
FORM OF DESIGNATED SECURITIES:
[Definitive form to be made available for checking and packaging at least
twenty-four hours prior to the Time of Delivery at the office of [The
Depository Trust Company or its designated custodian] [the
Representatives]]
[Book-entry only form represented by one or more global securities
deposited with The Depository Trust Company ("DTC") or its designated
custodian, to be made available for checking by the Representatives at
least twenty-four hours prior to the Time of Delivery at the office of
DTC.]
SPECIFIED FUNDS FOR PAYMENT OF PURCHASE PRICE:
Federal (same day) funds
TIME OF DELIVERY:
a.m. (New York City time), , 20
INDENTURE:
Indenture dated May 19, 1999, between the Company and The Bank of New
York, as Trustee
MATURITY:
INTEREST RATE:
[ %] [Zero Coupon] [See Floating Rate Provisions]
INTEREST PAYMENT DATES:
[months and dates, commencing ....................., 20..]
REDEMPTION PROVISIONS:
[No provisions for redemption]
4
<PAGE> 27
[The Designated Securities may be redeemed, otherwise than through the
sinking fund, in whole or in part at the option of the Company, in the
amount of [$ ] or an integral multiple thereof, [on or after
, at the following redemption prices (expressed in percentages of
principal amount). If [redeemed on or before , %, and if]
redeemed during the 12-month period beginning ,
REDEMPTION
YEAR PRICE
and thereafter at 100% of their principal amount, together in each case
with accrued interest to the redemption date.]
[on any interest payment date falling on or after , , at the election of
the Company, at a redemption price equal to the principal amount thereof,
plus accrued interest to the date of redemption.]]
[Other possible redemption provisions, such as mandatory redemption upon
occurrence of certain events or redemption for changes in tax law]
[Restriction on refunding]
SINKING FUND PROVISIONS:
[No sinking fund provisions]
[The Designated Securities are entitled to the benefit of a sinking fund
to retire [$ ] principal amount of Designated Securities on
in each of the years through at 100% of their principal
amount plus accrued interest[, together with [cumulative] [noncumulative]
redemptions at the option of the Company to retire an additional [$ ]
principal amount of Designated Securities in the years through at
100% of their principal amount plus accrued interest.]
[If Designated Securities are extendable debt securities, insert--
EXTENDABLE PROVISIONS:
Designated Securities are repayable on , [insert date and years], at
the option of the holder, at their principal amount with accrued
interest. The initial annual interest rate will be %, and thereafter
the annual interest rate will be adjusted on , and to a rate not less
than % of the effective annual interest rate on U.S. Treasury
obligations with -year maturities as of the [insert date 15 days
prior to maturity date] prior to such [insert maturity date].]
[If Designated Securities are floating rate debt securities, insert--
FLOATING RATE PROVISIONS:
Initial annual interest rate will be % through [and
thereafter will be adjusted [monthly] [on each , ,
and ] [to an annual rate of % above the average rate for
-year [month][securities][certificates of deposit] issued by
5
<PAGE> 28
(the excess, if any, of (i) the then current weekly average per annum
secondary market yield for -month certificates of deposit over (ii)
the then current interest yield equivalent of the weekly average per
annum market discount rate for -month Treasury bills); [from
and thereafter the rate will be the then current interest yield
equivalent plus % of Interest Differential].]
DEFEASANCE PROVISIONS:
CLOSING LOCATION FOR DELIVERY OF DESIGNATED SECURITIES:
ADDITIONAL CLOSING CONDITIONS:
NAMES AND ADDRESSES OF REPRESENTATIVES:
Designated Representatives: Goldman, Sachs & Co.
Address for Notices, etc.: 32 Old Slip, 21st Floor, New York, New York
10005, Attention: Registration Department.
[OTHER TERMS]:
6
<PAGE> 29
ANNEX II
and [insert names of banks].] [and the annual interest
rate [thereafter] [from through ] will be the interest
yield equivalent of the weekly average per annum market discount rate for
-month Treasury bills plus % of Interest Differential
Pursuant to Section 7(e) of the Underwriting Agreement, the accountants
shall furnish letters to the Underwriters to the effect that:
(i) They are independent certified public accountants with respect to
the Company and its subsidiaries within the meaning of the Act and the
applicable published rules and regulations;
(ii) In their opinion, the financial statements and any supplementary
financial information and schedules (and, if applicable, financial
forecasts and/or pro forma financial information) audited or examined by
them and included or incorporated by reference in the Registration
Statement or the Prospectus comply as to form in all material respects with
the applicable accounting requirements of the Act or the Exchange Act, as
applicable, and the related published rules and regulations thereunder;
and, if applicable, they have made a review in accordance with standards
established by the American Institute of Certified Public Accountants of
the consolidated interim financial statements, selected financial data, pro
forma financial information, financial forecasts and/or condensed financial
statements derived from audited financial statements of the Company for the
periods specified in such letter, as indicated in their reports thereon,
copies of which have been furnished to the Underwriters;
(iii) They have made a review in accordance with standards established
by the American Institute of Certified Public Accountants of the unaudited
condensed consolidated statements of income, consolidated balance sheets
and consolidated statements of cash flows included in the Prospectus and/or
included in the Company's Quarterly Report(s) on Form 10-Q covering periods
after the latest full fiscal year and incorporated by reference into the
Prospectus as indicated in their reports thereon copies of which have been
furnished to the Underwriters; and on the basis of specified procedures
including inquiries of officials of the Company, who have responsibility
for financial and accounting matters regarding whether the unaudited
condensed consolidated financial statements referred to in paragraph
(vi)(A)(i) below comply as to form in all material respects with the
applicable accounting requirements of the Act and the Exchange Act and the
related published rules and regulations, nothing came to their attention
that caused them to believe that the unaudited condensed consolidated
financial statements do not comply as to form in all material respects with
the applicable accounting requirements of the Act and the Exchange Act and
the related published rules and regulations;
(iv) The unaudited selected financial information with respect to the
consolidated results of operations and financial position of the Company
for the five most recent fiscal years included in the Prospectus and/or
included or incorporated by reference in Item 6 of the Company's Annual
Report on Form 10-K for the most recent fiscal year agrees with the
corresponding amounts (after restatement where applicable) in the audited
consolidated financial statements for such fiscal years;
(v) They have compared the information in the Prospectus under selected
captions with the disclosure requirements of Regulation S-K and on the
basis of limited procedures specified in such letter nothing came to their
attention as a result of the foregoing procedures that caused them to
believe that this information does not conform in all material respects
with the disclosure requirements of Items 301, 302, 402 and 503(d),
respectively, of Regulation S-K;
<PAGE> 30
(vi) On the basis of limited procedures, not constituting an
examination in accordance with generally accepted auditing standards,
consisting of a reading of the unaudited financial statements and other
information referred to below, a reading of the latest available interim
financial statements of the Company and its subsidiaries, inspection of the
minute books of the Company and its subsidiaries since the date of the
latest audited financial statements included or incorporated by reference
in the Prospectus as amended or supplemented, inquiries of officials of the
Company and its subsidiaries responsible for financial and accounting
matters and such other inquiries and procedures as may be specified in such
letter, nothing came to their attention that caused them to believe that:
(A) (i) the unaudited condensed consolidated statements of
income, consolidated balance sheets and consolidated statements of
cash flows included in the Prospectus and/or incorporated by
reference in the Company's Quarterly Report(s) on Form 10-Q covering
periods after the latest full fiscal year and incorporated by
reference in the Prospectus do not comply as to form in all material
respects with the applicable accounting requirements of the Exchange
Act and the related published rules and regulations, or (ii) any
material modifications should be made to the unaudited condensed
consolidated statements of income, consolidated balance sheets and
consolidated statements of cash flows included in the Prospectus
and/or included in the Company's Quarterly Report(s) on Form 10-Q
incorporated by reference in the Prospectus for them to be in
conformity with generally accepted accounting principles;
(B) any other unaudited income statement data and balance
sheet items included in the Prospectus do not agree with the
corresponding items in the unaudited consolidated financial
statements from which such data and items were derived, and any such
unaudited data and items were not determined on a basis substantially
consistent with the basis for the corresponding amounts in the
audited consolidated financial statements included or incorporated by
reference in the Company's Annual Report on Form 10-K for the most
recent fiscal year;
(C) the unaudited financial statements which were not included
in the Prospectus but from which were derived the unaudited condensed
financial statements referred to in clause (A) and any unaudited
income statement data and balance sheet items included in the
Prospectus as most recently amended or supplemented and referred to
in clause (B) were not determined on a basis substantially consistent
with the basis for the audited financial statements included or
incorporated by reference in the Company's Annual Report on Form 10-K
for the most recent fiscal year;
(D) any unaudited pro forma consolidated condensed financial
statements included or incorporated by reference in the Prospectus do
not comply as to form in all material respects with the applicable
accounting requirements of the Act and the published rules and
regulations thereunder or the pro forma adjustments have not been
properly applied to the historical amounts in the compilation of
those statements;
(E) as of a specified date not more than five days prior to
the date of such letter, there have been any changes in the
consolidated capital stock (other than
2
<PAGE> 31
issuances of capital stock upon exercise of options and stock
appreciation rights, upon earn-outs of performance shares and upon
conversions of convertible securities, in each case which were
outstanding on the date of the latest balance sheet included or
incorporated by reference in the Prospectus) or any increase in the
consolidated long-term debt of the Company and its subsidiaries, or
any decreases in consolidated net current assets or stockholders'
equity or other items specified by the Underwriters, or any increases
in any items specified by the Underwriters, in each case as compared
with amounts shown in the latest balance sheet included or
incorporated by reference in the Prospectus, except in each case for
changes, increases or decreases which the Prospectus discloses have
occurred or may occur or which are described in such letter; and
(F) for the period from the date of the latest financial
statements included or incorporated by reference in the Prospectus to
the specified date referred to in clause (E) there were any decreases
in consolidated total revenues or consolidated revenues, net of
interest expense, pre-tax earnings or total or per share amounts of
consolidated net income or other items specified by the Underwriters,
or any increases in any items specified by the Underwriters, in each
case as compared with the comparable items in the comparable period
of the preceding year and with any other period of corresponding
length specified by the Underwriters, except in each case for
increases or decreases which the Prospectus discloses have occurred
or may occur or which are described in such letter; and
(vii) In addition to the audit referred to in their report(s) included
or incorporated by reference in the Prospectus and the limited procedures,
inspection of minute books, inquiries and other procedures referred to in
paragraphs (iii) and (vi) above, they have carried out certain specified
procedures, not constituting an audit in accordance with generally accepted
auditing standards, with respect to certain amounts, percentages and
financial information specified by the Underwriters which are derived from
the general accounting records of the Company and its subsidiaries which
appear in the Prospectus (excluding documents incorporated by reference),
or in Part II of, or in exhibits and schedules to, the Registration
Statement specified by the Underwriters or in documents incorporated by
reference in the Prospectus specified by the Underwriters, and have
compared certain of such amounts, percentages and financial information
with the accounting records of the Company and its subsidiaries and have
found them to be in agreement.
All references in this Annex II to the Prospectus shall be deemed to refer to
the Prospectus (including the documents incorporated by reference therein) as
defined in the Underwriting Agreement as of the Time of Sale referred to in
Section 7 thereof and to the Prospectus as amended or supplemented (including
the documents incorporated by reference therein) as of the date of the
amendment, supplement or incorporation or the Time of Delivery relating to the
Pricing Agreement requiring the delivery of such letter under Section 7(e)
thereof.
3
