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8-K - FORM 8-K - FORD MOTOR CO | k49092e8vk.htm |
EX-5.1 - EX-5.1 - FORD MOTOR CO | k49092exv5w1.htm |
Exhibit 1.1
EXECUTION VERSION
Ford Motor Company
362,391,605 Warrants
Underwriting Agreement
March 30, 2010
Deutsche Bank Securities Inc.
as Representative of the Several Underwriters
as Representative of the Several Underwriters
c/o Deutsche Bank Securities Inc.
60 Wall Street, 4th Floor
New York, New York 10005
60 Wall Street, 4th Floor
New York, New York 10005
Ladies and Gentlemen:
The UAW Retiree Medical Benefits Trust, an unincorporated trust established under the laws of
the State of New York (the Selling Security Holder) proposes to sell to the several underwriters
(the Underwriters) named in Schedule I hereto, for whom you are acting as representative (the
Representative), an aggregate of up to 362,391,605 warrants (the Warrants) of Ford Motor
Company, a Delaware corporation (the Company), representing the right to purchase an aggregate of
up to that same number of shares (the Warrant Shares) of the Companys common stock, $0.01 par
value per share (the Common Stock). The respective maximum amounts of the Warrants to be so
purchased by the several Underwriters (the Underwriters Warrants) are set forth opposite their
names in Schedule I hereto.
Independent Fiduciary Services, Inc. (IFS), a Delaware corporation, has been appointed as an
independent fiduciary to manage the Warrants held in the Ford Separate Retiree Account, as such
terms are defined in, and pursuant to, the UAW Retiree Medical Benefits Trust Agreement, effective
as of December 3, 2009 (the Trust Agreement).
As the Representative, you have advised the Company and the Selling Security Holder (a) that
you are authorized to enter into this Agreement on behalf of the several Underwriters, and (b)
that the several Underwriters are willing, acting severally and not jointly, to purchase the number
of Warrants set forth opposite their respective names in Schedule I.
A registration statement on Form S-3 (File No. 333-151355) (the Registration Statement) in
respect of the Warrants and the Warrant Shares has been filed with the Securities and Exchange
Commission (the Commission).
The various parts of the Registration Statement, including all exhibits thereto, but excluding
Form T-1, and, if applicable, including information (Rule 430A Information), if any, deemed to be
a part of the Registration Statement at the time of effectiveness pursuant to
Rule 430A under the Securities Act of 1933, as amended (the Act), each as amended at the
time such part became effective; any registration statement filed pursuant to Rule 462(b) of the
Act is referred to as the Rule 462(b) Registration Statement and after such filing the term
Registration Statement shall include the Rule 462(b) Registration Statement.
Any reference herein to the term Preliminary Prospectus shall be deemed to refer to the
prospectus included in the Registration Statement at the time it became effective together with any
prospectus or supplement relating to the Warrants and the Warrant Shares filed thereafter with the
Commission pursuant to Rule 424 under the Act that is or is deemed to be a part of the Registration
Statement and that omits any Rule 430B Information (as defined below).
Any reference herein to the term Statutory Prospectus shall be deemed to refer to the
Preliminary Prospectus relating to the Warrants and the Warrant Shares that is or is deemed to be a
part of the Registration Statement immediately prior to the Time of Sale (as defined below)
(including the prospectus included in the Registration Statement at the time it became effective).
Any reference herein to the term Final Prospectus shall be deemed to refer to the prospectus
included in the Registration Statement at the time it became effective together with any prospectus
or supplement relating to the Warrants and the Warrant Shares that is or is deemed to be a part of
the Registration Statement at effectiveness and that includes Rule 430B Information in the form in
which it is first filed with the Commission pursuant to Rule 424(b) under the Act.
Any reference herein to the Registration Statement, any Preliminary Prospectus, the Statutory
Prospectus or the Final Prospectus shall be deemed to include the documents incorporated by
reference therein pursuant to Item 12 of Form S-3 under the Act, as of the effective date of the
Registration Statement or the date of such Preliminary Prospectus, Statutory Prospectus or Final
Prospectus, as the case may be, as well as any documents filed after the effective date of the
Registration Statement or the date of such Preliminary Prospectus, Statutory Prospectus or Final
Prospectus, as the case may be, under the Securities Exchange Act of 1934, as amended (the
Exchange Act), and so incorporated by reference.
Any information included in the Final Prospectus that was omitted from the Registration
Statement at the time it became effective but that is deemed to be part of and included in the
Registration Statement pursuant to Rule 430B under the Act is hereinafter referred to as the Rule
430B Information.
1. Purchase, Sale and Delivery of the Warrants.
(a) On the basis of the representations, warranties and covenants herein contained, and
subject to the conditions herein set forth and the Auction procedures described in the
Preliminary Prospectus and the Final Prospectus, the Selling Security Holder agrees to sell
to the Underwriters and the Underwriters agree to severally
purchase as set forth on Schedule I hereto, subject to any decrease pursuant to Section
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1(b) once the Clearing Price has been determined, an aggregate of up to 362,391,605 Warrants
(the Number of Offered Warrants) at a price per Warrant equal to (i) the price per Warrant
(the Clearing Price) to be determined following the submission deadline for the auction
(the Auction) to be commenced promptly following the execution of this Agreement and in
the manner specified in the Preliminary Prospectus and promptly notified to the Selling
Security Holder and the Company in writing, minus (ii) a discount per Warrant equal to 2.00%
of the Clearing Price.
(b) If the number of Warrants for which bids are received in the Auction is (i) less
than 50% of the Number of Offered Warrants, then no sales of Warrants shall be made pursuant
to this Agreement, (ii) 50% or more but less than 100% of the Number of Offered Warrants,
then the Selling Security Holder shall sell and deliver and the Underwriters shall purchase
pursuant to this Agreement, all the Warrants for which bids were received in the Auction at
a price per Warrant equal to the minimum price in the Auction (which in such case shall be
the Clearing Price for purposes of this Agreement) less the discount specified in Section
1(a)(ii), and (iii) 100% or more of the Number of Offered Warrants, then the Selling
Security Holder shall sell and deliver and the Underwriters shall purchase pursuant to this
Agreement, 100% of the Number of Offered Warrants at a price per Warrant equal to the
Clearing Price less the discount specified in Section 1(a)(ii).
(c) Payment for the Warrants to be sold hereunder is to be made in Federal (same day)
funds to an account designated by the Selling Security Holder (or its agent) against
delivery of certificates therefor to the Representative by the Selling Security Holder (or
its agent). Such payment and delivery are to be made through the facilities of The
Depository Trust Company (DTC) at 10:00 a.m., New York time, on April 6, 2010, or at such
other time and date not later than five business days thereafter as the Representative, the
Company and the Selling Security Holder shall agree upon, such time and date being herein
referred to as the Time of Delivery. (As used herein, business day means a day on which
the New York Stock Exchange (the NYSE) is open for trading and on which banks in New York
are open for business and not permitted by law or executive order to be closed.)
2. Representations and Warranties
A. The Company represents and warrants to, and agrees with, each of the Underwriters and the
Selling Security Holder that:
(a) The Registration Statement has been filed with the Commission in the form
heretofore delivered to the Representative, and such registration statement in such form has
been declared effective by the Commission or has otherwise become effective by rule of the
Commission; and no stop order suspending the effectiveness of the
registration statement has been issued and no proceeding for that purpose has been
initiated or threatened by the Commission;
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(b) Other than any Preliminary Prospectus, the Final Prospectus, and any document not
constituting a prospectus pursuant to Section 2(a)(10)(a) of the Act or Rule 134 under the
Act, the Company (including its agents and representatives, other than Underwriters in their
capacity as such) has not prepared, made, used, authorized, approved or referred to and will
not prepare, make, use, authorize, approve or refer to any written communication (as
defined in Rule 405 under the Act) that constitutes an offer to sell or solicitation of an
offer to buy any Warrants or Warrant Shares required to be filed with the Commission (each
such communication by the Company or its agents and representatives being referred to herein
as an Issuer Free Writing Prospectus) without the Underwriters consent, other than
written communications approved in writing in advance by the Representative and specified in
Schedule II hereto (being referred to herein as a Specified Issuer Free Writing
Prospectus);
(c) (i) At the respective times the Registration Statement and each amendment thereto
became effective, at each deemed effective date with respect to the Underwriters pursuant to
Rule 430B(f)(2) under the Act and at the Time of Delivery, the Registration Statement
complied and will comply in all material respects with the requirements of the Securities
Act and the rules and regulations under the Act; (ii) the Statutory Prospectus and the Final
Prospectus complied when filed with the Commission in all material respects with the rules
and regulations under the Act; (iii) the documents incorporated by reference in the
Statutory Prospectus and the Final Prospectus, when they were filed with the Commission,
conformed in all material respects to the requirements of the Exchange Act and the rules and
regulations of the Commission thereunder, and any further documents so filed and
incorporated by reference, when they are filed with the Commission, will conform in all
material respects to the requirements of the Exchange Act and the rules and regulations of
the Commission thereunder; and (iv) each Specified Issuer Free Writing Prospectus complied
in all material respects with the Act and has been filed or will be filed in accordance with
the Act (to the extent required thereby);
(d) (i) At the respective times the Registration Statement and each amendment thereto
became effective, at each deemed effective date with respect to the Underwriters pursuant to
Rule 430B(f)(2) under the Act, the Registration Statement did not and will not contain an
untrue statement of a material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading; (ii) as of the time at
which bids submitted to the auction agent (the Auction Agent) in connection with the
Auction become irrevocable and may no longer be withdrawn, as set forth in the Preliminary
Prospectus (including any extension of such deadline) (the Time of Sale), the Statutory
Prospectus and any Specified Issuer Free Writing Prospectus, considered together
(collectively, the General Disclosure Package) did not contain any untrue statement of a
material fact or omitted 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; and (iii) as of its date and at the Time of Delivery, the
Final Prospectus did not and will not contain an untrue statement of a material fact or omit
to state a material fact necessary in order to make the statements therein, in the light of
the
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circumstances under which they were made, not misleading; provided,
however, that this representation and warranty shall not apply to any statement or
omission made in reliance upon and in conformity with (a) information furnished in writing
to the Company by an Underwriter of the Warrants through the Representative expressly for
use in the General Disclosure Package or in the Final Prospectus relating to the Warrants or
(b) any Selling Security Holder Information (as defined below);
(e) Each Specified Issuer Free Writing Prospectus, as of its issue date and at all
subsequent times through the completion of the public offer and sale of the Warrants or
until any earlier date that the Company notified or notifies the Representative, did not,
does not and will not include any information that conflicted, conflicts or will conflict
with the information contained in the Registration Statement or the Final Prospectus; any
electronic roadshow, when considered together with the General Disclosure Package, as of the
Time of Sale, did not contain any untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading;
(f) The Company has been duly incorporated and is validly existing as a corporation in
good standing under the laws of the State of Delaware, and has the corporate power and
authority, and has all licenses, permits, orders and other governmental and regulatory
approvals, to own or lease its properties and conduct its business in the jurisdictions in
which such business is transacted as described in the General Disclosure Package and the
Final Prospectus with only such exceptions as are not material to the business of the
Company and its subsidiaries considered as a whole;
(g) This Agreement has been duly authorized, executed and delivered on behalf of the
Company;
(h) The Warrants have been duly authorized and validly issued and constitute valid and
legally binding obligations of the Company in accordance with their terms; as of the Time of
Delivery, the Amended and Restated Warrant Agreement by and between the Company and
Computershare Trust Company, N.A. in the form attached as Exhibit E hereto (the Warrant
Amendment) will have been duly authorized, executed and delivered by the Company and will
constitute a valid and legally binding obligation of the Company in accordance with its
terms; as of the Time of Delivery, the Warrants (as amended by the Warrant Amendment) will
conform in all material respects to the description thereof contained or incorporated by
reference in the General Disclosure Package and the Final Prospectus; neither the filing of
the Registration Statement nor the offering or sale of the Warrants as contemplated by this
Agreement gives rise to any rights, other than those which have been waived or satisfied,
for or relating to the registration of any Warrants or Warrant Shares;
(i) The Warrant Shares have been duly authorized by the Company and validly reserved
for issuance by the Company upon exercise of the Warrants against
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payment of the exercise
price with respect to the Warrants (including by means of a net exercise) by all necessary
corporate action of the Company, and the Warrant Shares, when duly issued by the Company,
will be validly issued, fully paid and non-assessable; no holder thereof will be subject to
personal liability solely by reason of being such a holder; the issuance of the Warrant
Shares will not be subject to preemptive or similar rights; and the form of certificate for
the Warrants conforms to the corporate law of the jurisdiction of the Companys
incorporation and to any requirements of the Companys organizational documents;
(j) The Company has an authorized capitalization as set forth in the General Disclosure
Package and the Final Prospectus; all of the issued shares of capital stock of the Company
have been duly and validly authorized and issued, are fully paid and non-assessable, and all
of the shares of Common Stock of the Company, including the Warrant Shares, conform to the
description thereof contained or incorporated by reference in the General Disclosure Package
and the Final Prospectus;
(k) The Common Stock is registered pursuant to Section 12(b) of the Exchange Act and is
listed on the NYSE, and the Company has taken no action designed to, or likely to have the
effect of, terminating the listing of the Common Stock from the NYSE, nor has the Company
received any notification that the Commission or the NYSE is contemplating terminating such
registration or listing. The Warrants shall be registered pursuant to Section 12(b) of the
Exchange Act prior to the opening of trading on the day after the day on which the
submission deadline for the Auction occurs, and by such time will have been approved for
listing on the NYSE, subject to notice of issuance, and the Company has not received any
notification that the Commission or the NYSE is contemplating terminating such registration
or listing;
(l) Neither the Company nor any of its subsidiaries nor, to the best of the Companys
knowledge, any of their respective directors, officers, affiliates or controlling persons
has taken, directly or indirectly, any action designed, or which has constituted or might
reasonably be expected to cause or result in the stabilization or manipulation of the price
of any security of the Company to facilitate the sale or resale of the Warrants or the
Warrant Shares;
(m) There is no consent, approval, authorization, order, registration or qualification
of or with any court or any regulatory authority or other governmental body having
jurisdiction over the Company which is required for, and the absence of which would
materially affect, the taking of any action by the Company in connection with the offering
and sale of the Warrants as contemplated by this Agreement or the execution, delivery and
performance by the Company of this Agreement, except the registration under the Act of the
Warrants or the Warrant Shares and such consents, approvals, authorizations, registrations
or qualifications as may be required under the securities or
Blue Sky laws of any jurisdiction in connection with the public offering of the
Warrants and the Warrant Shares by the Underwriters;
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(n) PricewaterhouseCoopers LLP, who have certified certain of the financial statements
of the Company and its subsidiaries included or incorporated by reference in the
Registration Statement, the Statutory Prospectus and the Final Prospectus, is, to the best
knowledge of the Company, an independent registered public accounting firm with respect to
the Company as required by the Act and the rules and regulations adopted by the Commission
and the Public Company Accounting Oversight Board (United States);
(o) (A) (i) At the time of filing the Registration Statement, (ii) at the time of the
most recent amendment thereto for the purposes of complying with Section 10(a)(3) of the Act
(whether such amendment was by post-effective amendment, incorporated report filed pursuant
to Section 13 or 15(d) of the Exchange Act or form of prospectus), and (iii) at the time the
Company or any person acting on its behalf (within the meaning, for this clause only, of
Rule 163(c)) made any offer relating to the Securities in reliance on the exemption of Rule
163 under the Act, the Company was not an ineligible issuer as defined in Rule 405 of the
Act; and (B) at the time of filing Registration Statement No. 333- 151355, at the earliest
time thereafter that the Company or another offering participant made a bona fide offer
(within the meaning of Rule 164(h)(2) under the Act) of the Securities and at the date
hereof, the Company was not and is not an ineligible issuer as defined in Rule 405 under
the Act; and
(p) The Option Period, as such term is defined in Section 3.02(a) of the
Securityholder and Registration Rights Agreement, dated as of December 11, 2009, by and
between the Company and the Selling Security Holder (as assignee of VEBA-F Holdings LLC)
(the Registration Rights Agreement), with respect to the proposed sale of the Warrants
hereunder has expired and no Option Exercise Notice, as defined in Section 3.02 of the
Registration Rights Agreement, is currently effective with respect to the Warrants.
B. The Selling Security Holder represents and warrants to, and agrees with, each of the
Underwriters and the Company that:
(a) The Selling Security Holder now has and at the Time of Delivery will have good and
marketable title to the Warrants to be sold by the Selling Security Holder, free and clear
of any liens, encumbrances, equities and claims; the Warrants to be sold by the Selling
Security Holder pursuant to this Agreement are certificated securities in registered form
and are not held by or through any securities intermediary within the meaning of the New
York Uniform Commercial Code (NYUCC); the Selling Security Holder has, and, at the Time of
Delivery will have, full right, power and authority to hold, sell, transfer and deliver the
Warrants to be sold by the Selling Security Holder hereunder; upon the delivery to DTC or
its agent of the Warrants registered in the name of Cede & Co., as nominee for DTC, and the
crediting by DTC of the Warrants to the
securities accounts of the several Underwriters with DTC, DTC will be a protected
purchaser of the Warrants (as defined in Section 8-303 of the NYUCC) and will acquire its
interest in the Warrants (including, without limitation, all rights that the Selling
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Security Holder had or has the power to transfer in such Warrants) free of any adverse
claim; upon the payment of the purchase price for the Warrants and the crediting by DTC of
the Warrants to the securities accounts of the several Underwriters with DTC, each of the
Underwriters will acquire a valid security entitlement (within the meaning of Section 8-501
of the NYUCC) in respect of the Warrants to be purchased by it, and no action (whether
framed in conversion, replevin, constructive trust, equitable lien, or other theory) based
on an adverse claim to such Warrants may be asserted against the Underwriters;
(b) The Selling Security Holder has full right, power and authority to execute and
deliver this Agreement and to perform its obligations under this Agreement.
(c) Prior to the Time of Delivery, the Selling Security Holder will have duly consented
to the Warrant Amendment in the form attached as Exhibit E hereto, subject to the closing of
the offering and sale of the Warrants contemplated by this Agreement.
(d) This Agreement has been duly authorized, executed and delivered by or on behalf of
the Selling Security Holder. The execution and delivery of this Agreement and the
consummation by the Selling Security Holder of the transactions herein contemplated and the
fulfillment by the Selling Security Holder of the terms hereof will not require any consent,
approval, authorization, or other order of any court, regulatory body, administrative agency
or other governmental body (except consents, approvals, authorizations, exemptions,
registrations or qualifications (i) which have been obtained or made and are in full force
and effect, including the Exemption (as defined below) and (ii) as may be required under the
securities or Blue Sky laws of any jurisdiction in connection with the public offering of
the Warrants and the Warrant Shares by the Underwriters) and will not result in a breach of
any of the terms and provisions of, or constitute a default under, (1) the organizational
documents of the Selling Security Holder, (2) any indenture, mortgage, deed of trust or
other agreement or instrument to which the Selling Security Holder is a party, or (3) any
order, rule or regulation applicable to the Selling Security Holder of any court or of any
regulatory body or administrative agency or other governmental body having jurisdiction.
(e) The Selling Security Holder has not taken and will not take, directly or
indirectly, any action designed to, or which has constituted, or which might reasonably be
expected to cause or result in the stabilization or manipulation of the price of any
security of the Company to facilitate the sale or resale of the Warrants or the Warrant
Shares and, other than as permitted by the Act, the Selling Security Holder will not
distribute any prospectus or other offering material in connection with the offering of the
Warrants.
(f) In respect of any statements in or omissions from the Registration Statement, the
General Disclosure Package, the Final Prospectus or any amendment or supplement thereto with
respect to such Selling Security Holder made in reliance upon and in conformity with
information furnished in writing to the Company by the Selling
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Security Holder expressly for
use in connection with the preparation thereof, the Selling Security Holder hereby makes the
same representations and warranties to each Underwriter as the Company makes to such
Underwriter under paragraphs (A)(d) and (A)(e) of this Section. The Selling Security Holder,
the Company and the Underwriters acknowledge that the statements with regard to the Selling
Security Holder set forth in the fourth paragraph under the caption Selling Security
Holder constitute the only information regarding the Selling Security Holder in the
Registration Statement, the General Disclosure Package, the Final Prospectus or any
amendment or supplement thereto (the Selling Security Holder Information);
(g) The sale of the Warrants by the Selling Security Holder pursuant hereto is not
prompted by any information concerning the Company or any of its subsidiaries which is not
set forth in the Registration Statement, the General Disclosure Package and the Final
Prospectus or the documents incorporated by reference therein;
(h) The transactions by the Selling Security Holder contemplated by this Agreement,
including the acquisition of the Warrants by the Underwriters and the disposition of the
Warrants through the Underwriters pursuant to the Auction, do not constitute a non-exempt
prohibited transaction under the U.S. Employee Retirement Income Security Act of 1974, as
amended (ERISA); provided, that the Selling Security Holder makes no
representation or warranty to the Company with respect to any purchases of Warrants by the
Company in the Auction;
(i) The transactions by the Selling Security Holder contemplated by this Agreement have
been authorized by the Selling Security Holder and all applicable conditions of Prohibited
Transaction Exemption 2010-08 granted by the U.S. Department of Labor (the Department) on
March 19, 2010 and published in the Federal Register on March 24, 2010 (the Exemption)
have been complied with;
(j) IFS has the authority, in accordance with the terms of the Trust Agreement, to
cause the Selling Security Holder to enter into this Agreement and perform its obligations
hereunder (including, but not limited to, the sale of the Warrants to the Underwriters
pursuant hereto) and to consent to the Warrant Amendment; and
(k) IFS has executed and delivered, concurrently with the execution of this Agreement,
an Assent and Acknowledgement in the form set forth as Exhibit F hereto.
3. Upon the execution of this Agreement and authorization by the Representative of the release
of the Underwriters Warrants, the several Underwriters will offer the Underwriters Warrants for
sale upon the terms and conditions and in accordance with the description of the offering process
set forth in the General Disclosure Package and the Final
Prospectus and, in connection with such offer or the sale of such Warrants, will use the
General Disclosure Package and the Final Prospectus, together with any amendment or supplement
thereto, that specifically describes the Warrants, in the form which has been most recently
distributed to them by the Company, only as permitted or contemplated thereby, and will offer
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and
sell the Warrants only as permitted by the Act and the applicable securities laws or regulations of
any jurisdiction. The Representative will use its best efforts to inform the Company and the
Selling Security Holder when it has authorized the sale of the Underwriters Warrants to the public
and when it has been advised that such Underwriters Warrants have been sold by the several
Underwriters within a reasonable period of time after such sales are completed.
4. Each of the Company and the Selling Security Holder acknowledges and agrees that each of
the Underwriters is acting solely in the capacity of an arms length contractual counterparty to
the Company and the Selling Security Holder with respect to the offering of any Warrants
contemplated hereby (including in connection with determining the terms of the offering) and not as
a financial advisor or a fiduciary (including, without limitation, for purposes of ERISA) to, or an
agent of, the Company, the Selling Security Holder or any other person. Additionally, none of the
Representative or any of the other Underwriters is advising the Company, the Selling Security
Holder or any other person as to any legal, tax, investment, accounting or regulatory matters in
any jurisdiction with respect to the offering contemplated hereby or the process leading thereto
(irrespective of whether the Representative or such Underwriter has advised or is advising the
Company or the Selling Security Holder on other matters). The Underwriters advise that the
Underwriters and their affiliates are engaged in a broad range of securities and financial services
and that they or their affiliates may enter into contractual relationships with purchasers or
potential purchasers of the Companys securities and that some of these services or relationships
may involve interests that differ from those of the Company or the Selling Security Holder and need
not be disclosed to the Company or the Selling Security Holder unless otherwise required by law.
Each of the Company and the Selling Security Holder has consulted with its own advisors concerning
such matters and shall be responsible for making its own independent investigation and appraisal of
the transactions contemplated hereby, and the Underwriters shall have no responsibility or
liability to the Company, the Selling Security Holder or any other person with respect thereto.
Any review by the Underwriters of the Company, the Selling Security Holder, the transactions
contemplated hereby or other matters relating to such transactions will be performed solely for the
benefit of the Underwriters and shall not be on behalf of the Company or the Selling Security
Holder. Each of the Company and the Selling Security Holder waives, to the fullest extent
permitted by law, any claims it may have against the Underwriters for breach of fiduciary duty or
alleged breach of fiduciary duty (including, without limitation, for purposes of ERISA) with
respect to the purchase and sale of the Warrants pursuant to this Agreement and agrees that the
Underwriters shall have no liability (whether direct or indirect) to the Company or the Selling
Security Holder in respect of such a fiduciary duty claim with respect to such purchase and sale or
to any person asserting a fiduciary duty claim (including a claim for breach of fiduciary duty
under ERISA) with respect to such purchase and sale on behalf of or in right of the Company or the
Selling
Security Holder, including stockholders, employees or creditors of the Company or
beneficiaries of the Selling Security Holder.
5. Covenants
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A. The Company agrees with each of the Underwriters:
(a) To make no amendment or any supplement to the Registration Statement (other than
the filing of the Preliminary Prospectus, any Specified Issuer Free Writing Prospectus
approved prior to the date hereof and the Companys proxy statement relating to its 2010
annual meeting of shareholders) or the Final Prospectus after the date hereof and prior to
the Time of Delivery for the Warrants prior to having furnished the Representative with a
copy of the proposed form thereof and given the Representative a reasonable opportunity to
review the same; 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 subsequent to the date of the Final Prospectus
and for so long as the delivery of a prospectus is required by law in connection with the
offering or sale of the Warrants, and during such same period to advise the Representative,
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 Final
Prospectus or any amended Final Prospectus has been filed or electronically transmitted for
filing, of the issuance of any stop order by the Commission, of the suspension of the
qualification of the Warrants 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 the Final Prospectus or for
additional information; and, in the event of the issuance of any such stop order or of any
order preventing or suspending the use of any prospectus relating to the Warrants or
suspending any such qualification, to use promptly its best efforts to obtain its
withdrawal;
(b) Promptly from time to time to take such action as the Representative may reasonably
request in order to qualify the Warrants and the Warrant Shares for offering and sale under
the securities laws of such states as the Representative may request and to continue such
qualifications in effect so long as necessary under such laws for the distribution of the
Warrants and the Warrant Shares, provided that in connection therewith the Company shall not
be required to qualify as a foreign corporation to do business, or to file a general consent
to service of process in any jurisdiction, and provided further that the expense of
maintaining any such qualification more than one year from the date hereof shall be at the
expense of the Underwriters;
(c) To furnish the Underwriters with copies of the Registration Statement (excluding
exhibits) and copies of the Final Prospectus in such quantities as the Representative may
from time to time reasonably request; and if, before a period of six
months shall have elapsed after the date hereof and the delivery of a prospectus shall
be at the time required by law in connection with sales of any Warrants or would be required
but for Rule 172 under the Act (Prospectus Delivery Period), either (i) any event shall
have occurred as a result of which the Final Prospectus would include any untrue statement
of a material fact or omit to state any material fact necessary in order to make
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the
statements therein, in the light of the circumstances under which they were made, not
misleading, or (ii) for any other reason it shall be necessary during such same period to
amend or supplement the Final Prospectus or to file under the Exchange Act any document
incorporated by reference into the Final Prospectus in order to comply with the Act or the
Exchange Act, to notify the Representative and upon its request to file such document and to
prepare and furnish without charge to each Underwriter and to any dealer participating in
the distribution of the Warrants as many copies as the Representative may from time to time
reasonably request of an amendment or a supplement to the Final Prospectus which will
correct such statement or omission or effect such compliance; and in case any Underwriter is
required by law to deliver a prospectus in connection with sales of any of the Warrants or
would be required but for Rule 172 under the Act at any time six months or more after the
date hereof, upon the request of the Representative, but at the expense of such Underwriter,
to prepare and deliver to such Underwriter as many copies as the Representative may request
of an amended or supplemented prospectus complying with Section 10(a)(3) of the Act;
(d) To make generally available to its security holders as soon as practicable, but in
any event no later than eighteen months after the effective date of the Registration
Statement (as such date is defined in Rule 158(c) under the Act), an earnings statement of
the Company and its consolidated subsidiaries complying with Rule 158 under the Act and
covering a period of at least twelve consecutive months beginning after such effective date;
(e) During a period of five years from the date hereof, to furnish to the
Representative copies of all reports or other communications (financial or other) furnished
to security holders, and to deliver to the Representative, during such same period, (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 any of 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 the Representative may
from time to time reasonably request (such financial statements to be on a consolidated
basis to the extent that the accounts of the Company and its subsidiaries are consolidated
in reports furnished to its security holders generally or to the Commission);
(f) To pay or cause to be paid all costs and expenses incident to the performance of
its obligations hereunder, including (i) all registration and filing fees (including fees
and expenses (A) with respect to filings required to be made with all applicable securities
exchanges and/or the Financial Industry Regulatory Authority, Inc.
and (B) the cost of all qualifications of the Warrants and Warrant Shares under state
securities laws (including reasonable fees and disbursements of counsel to the Underwriters
in connection with such qualifications and with legal investment surveys)), (ii) printing
expenses (including expenses of printing certificates for the Warrants in a form eligible
for deposit with DTC and of printing copies of each Preliminary Prospectus,
12
any Permitted Free Writing
Prospectus, and the Final Prospectus and any amendments or supplements thereto if printing
is requested by the Representative or the Selling Security Holder, (iii) messenger,
telephone and delivery expenses of the Company, (iv) fees and disbursements of counsel for
the Company, (v) expenses of the Company incurred in connection with any road show, (vi)
fees and disbursements of all independent registered public accounting firms (including,
without limitation, the expenses of any special audit and cold comfort letters required by
or incident to this Agreement) and
any other persons, including special experts, retained by the Company, (vii) if the
offering of the Warrants contemplated hereunder is completed, fees up to $250,000 and
reasonable disbursements of one legal counsel for the Selling Security Holder in connection
with the registration and sale of the Warrants under this Agreement. For the avoidance of
doubt, the Company shall not be required to pay underwriting discounts and commissions and
transfer taxes, if any, relating to the sale or disposition of the Warrants pursuant to this
Agreement, or any other expenses of the Selling Security Holder. In addition, the Company
shall bear all of its internal expenses (including all salaries and expenses of its officers
and employees performing legal or accounting duties), the expense of any annual audit, and
the fees and expenses of any person, including special experts, retained by the Company. It
is understood that, except as provided in this subsection (f) and in Section 10 hereof, the
Underwriters will pay all of their own costs and expenses, including the cost of printing
any Agreement among Underwriters, the fees of their counsel, transfer taxes on resale of any
of the Warrants by them and any advertising expenses connected with any offers that they may
make. Further, it is understood that except for those expenses to be paid by the Company
under the terms of the Registration Rights Agreement, which the Company will pay or cause to
be paid, the Selling Security Holder will pay all of its expenses incident to the
performance of its obligations under, and the consummation of the transactions contemplated
by this Agreement, including (i) all underwriting discounts and commissions payable
hereunder, (ii) any one-time and ongoing fees and expenses incurred in connection with the
listing of the Warrants on the NYSE, any transfer taxes, if any, payable upon the sale of
the Warrants by the Selling Security Holder to the Underwriters, and their transfer between
the Underwriters pursuant to an agreement between such Underwriters, and (iii) except as
provided in clause (vii) of this subsection (f), the fees and disbursements of the Selling
Security Holders counsel and other advisors;
(g) To comply with the requirements of Rule 433 under the Act applicable to any issuer
free writing prospectus, as defined in such rule, including timely filing with the
Commission where required, legending and record keeping;
(h) If any time prior to the Time of Delivery (i) any event shall occur or condition
shall exist as a result of which the General Disclosure Package would include any untrue
statement of a material fact or omit to state any material fact necessary in order to make
the statements therein, in the light of the circumstances, not misleading or (ii) it is
necessary to amend or supplement the General Disclosure Package to comply with law, to
immediately notify the Underwriters thereof and forthwith prepare and,
13
subject to paragraph
5(a) above, file with the Commission (to the extent required) and to furnish to the
Underwriters and to such dealers as the Representative may designate, such amendments or
supplements to the General Disclosure Package as may be necessary so that the statements in
the General Disclosure Package as so amended or supplemented will not, in the light of the
circumstances, be misleading or so that the General Disclosure Package will comply with law;
(i) Subject to the Selling Security Holders performance of its obligation to pay fees
and expenses in connection therewith pursuant to Section 5(A)(f), to use its reasonable best
efforts to effect and maintain the listing of the Warrants on the NYSE for so long as the
Warrants are outstanding;
(j) To reserve and keep available at all times, free of preemptive rights, Warrant
Shares for the purpose of enabling the Company to satisfy the obligations to issue the
Warrant Shares issuable upon exercise of the Warrants, and to list the Warrant Shares
issuable upon exercise of the Warrants on the NYSE in advance of any such exercise;
(k) To maintain a transfer agent and, if necessary under the jurisdiction of
incorporation of the Company, a registrar for the Warrants and for the Warrant Shares;
(l) Not to take, directly or indirectly, any action designed, or which has constituted
or might reasonably be expected to cause or result in the stabilization or manipulation of
the price of any security of the Company to facilitate the sale or resale of the Warrants or
the Warrant Shares; and
(m) That the Company shall not, for a period of 60 days from the date of the Final
Prospectus, offer, sell, contract to sell, pledge, grant any option to purchase, make any
short sale or otherwise dispose of, directly or indirectly, or file or cause to be filed
with the Commission a registration statement under the Securities Act, relating to, or enter
into any swap, hedge or other arrangement that transfers, in whole or in part, any of the
economic consequences of ownership of, any Warrants or shares of Common Stock, or any
options or warrants to purchase any shares of Common Stock, or any securities convertible
into, exchangeable or exercisable for or that represent the right to receive, shares of
Common Stock, whether any such aforementioned transaction is to be settled by delivery of
any such securities, in cash, or otherwise without the prior written consent of Deutsche
Bank Securities Inc. Notwithstanding these restrictions: (a) the Company may take such
actions with respect to (i) issuances of Common Stock issuable upon conversion or exercise
of securities or options outstanding on the date of the Final Prospectus (including, without
limitation, the Warrants sold hereunder) or upon the settlement of any notes issued by the
Company to the Selling Security Holder that may be settled in Common Stock, and (ii)
issuances of Common Stock as consideration in future acquisitions, transfers of Common Stock
to affiliates and issuances of Common Stock or options or other awards under existing
employee benefit or compensation plans; and (b)
14
beginning on the sixth business day
following the date of the Final Prospectus, the Company may sell shares of Common Stock
pursuant to the Equity Distribution Agreement dated as of December 4, 2009 between the
Company and Barclays Capital Inc., Citigroup Global Markets Inc., Deutsche Bank Securities
Inc., Goldman, Sachs & Co., J.P. Morgan Securities Inc., Merrill Lynch, Pierce, Fenner &
Smith, Morgan Stanley & Co. Incorporated and RBS Securities Inc.
B. The Selling Security Holder agrees with each of the Underwriters:
(a) That the Selling Security Holder shall not, for a period of 60 days from the date
of the Final Prospectus, offer, sell, contract to sell, pledge, grant any option to
purchase, make any short sale or otherwise dispose of, directly or indirectly, or file or
cause to be filed with the Commission a registration statement under the Securities Act,
relating to, or enter into any swap, hedge or other arrangement that transfers, in whole or
in part, any of the economic consequences of ownership of, any Warrants or shares of Common
Stock, or any options or warrants to purchase any shares of Common Stock, or any securities
convertible into, exchangeable or exercisable for or that represent the right to receive,
shares of Common Stock, whether any such aforementioned transaction is to be settled by
delivery of any such securities, in cash, or otherwise without the prior written consent of
Deutsche Bank Securities Inc.;
(b) In order to document the Underwriters compliance with the reporting and
withholding provisions of the Tax Equity and Fiscal Responsibility Act of 1982 and the
Interest and Dividend Tax Compliance Act of 1983 with respect to the transactions herein
contemplated, the Selling Security Holder agrees to deliver to you prior to or at the Time
of Delivery a properly completed and executed United States Treasury Department Form W-8 or
W-9 (or other applicable form or statement specified by Treasury Department regulations in
lieu thereof);
(c) Not to take, directly or indirectly, any action designed, or which has constituted
or might reasonably be expected to cause or result in the stabilization or manipulation of
the price of any security of the Company to facilitate the sale or resale of the Warrants or
the Warrant Shares;
(d) Not to prepare, make, use, authorize, approve or refer to any written
communication (as defined in Rule 405 under the Act) that constitutes an offer to sell or
solicitation of an offer to buy any Warrants or Warrant Shares, and agrees that it will not
distribute any written materials in connection with the offer or sale of the Warrants
without the prior approval of the Representative;
(e) During the Prospectus Delivery Period, the Selling Security Holder will advise the
Representative promptly, and will confirm such advice in writing to the Representative, of
any change to the Selling Security Holder Information in the
15
Registration Statement, the
Final Prospectus or any document comprising the General Disclosure Package; and
(f) Prior to the Time of Delivery, to execute and deliver its consent to the Warrant
Amendment in the form attached as Exhibit E hereto, which consent may be subject to the
closing of the offering and sale of the Warrants contemplated by this Agreement.
C. Each Underwriter severally agrees and covenants with the Company not:
(a) To take any action that would result in the Company being required to file with the
Commission under Rule 433(d) under the Act, a free writing prospectus or Company information
prepared by or on behalf of such Underwriter that otherwise would not be required to be
filed by the Company thereunder, but for the action of such Underwriter.
6. The obligations of the Underwriters shall be subject, in the discretion of the
Representative, to the condition that all representations and warranties and other statements of
the Company and the Selling Security Holder herein are, at and as of the Time of Delivery for the
Warrants, true and correct, the condition that the Company and the Selling Security Holder shall
have performed all of their respective obligations hereunder theretofore to be performed, in all
material respects, and the following additional conditions:
(a) No stop order suspending the effectiveness of the Registration Statement shall have
been issued and no proceeding for that purpose shall have been initiated or threatened by
the Commission; the Statutory Prospectus, the Final Prospectus, any amendment or supplement
thereto and each Specified Issuer Free Writing Prospectus shall have been timely filed with
the Commission under the Act (in the case of a Specified Issuer Free Writing Prospectus, to
the extent required by Rule 433 under the Act); and all requests for additional information
on the part of the Commission shall have been complied with or otherwise satisfied.
(b) The Warrant Amendment, in the form set forth in Exhibit E hereto, shall have been
duly executed and delivered by the Company and Computershare Trust Company, N.A. and shall
be effective.
(c) The Warrants and the Warrant Shares shall have been approved for listing, subject
to notice of issuance, on the NYSE.
(d) P.J. Sherry, Jr., as Associate General Counsel and Secretary of the Company, or
other counsel satisfactory to the Representative, in its reasonable judgment, shall have
furnished to the Underwriters a written opinion and negative assurance letter, dated the
Time of Delivery for the Warrants and the Warrant Shares, in form satisfactory to the
Representative in its reasonable judgment, to the effect of Exhibit A-1 and A-2 hereto,
respectively.
16
(e) Shearman & Sterling LLP, counsel to the Underwriters, shall have furnished to the
Representative its written opinion, dated the Time of Delivery for the Warrants and the
Warrant Shares, in form satisfactory to the Representative in its reasonable judgment, to
the effect of Exhibit B-1 and B-2 hereto, respectively.
(f) Cleary Gottlieb Steen & Hamilton LLP, special structuring counsel to the
Underwriters, shall have furnished to the Representative its written opinion, dated the Time
of Delivery for the Warrants and the Warrant Shares, in form satisfactory to the
Representative in its reasonable judgment, to the effect of Exhibit C hereto.
(g) Proskauer Rose LLP, counsel to IFS, shall have furnished to the Representative its
written opinion, dated the Time of Delivery for the Warrants and the Warrant Shares, in form
satisfactory to the Representative in its reasonable judgment, to the effect of Exhibit D
hereto.
(h) (A) At the time of execution of this Agreement, the Representative shall have
received a letter dated such date, in form and substance satisfactory to the Representative
in its reasonable judgment, from PricewaterhouseCoopers LLP, containing statements and
information of the type ordinarily included in accountants comfort letters to
underwriters with respect to the financial statements and certain financial information
contained or incorporated by reference in the Registration Statement and the General
Disclosure Package; and (B) at the Time of Delivery, the Representative shall have received
from PricewaterhouseCoopers LLP a letter, dated as of the Time of Delivery, to the effect
that they reaffirm the statements made in the letter furnished pursuant to subsection (A) of
this paragraph (h), except that the specified date referred to shall be a date not more than
three business days prior to the Time of Delivery, and such letter shall contain statements
and information with respect to certain financial information contained in the Final
Prospectus;
(i) Since the respective dates as of which information is given in the General
Disclosure Package and the Final Prospectus, there shall not have occurred any material
adverse change, or any development involving a prospective material adverse change, in or
affecting particularly the business or assets of the Company and its subsidiaries considered
as a whole, or any material adverse change in the financial position or results of
operations of the Company and its subsidiaries considered as a whole, otherwise than as set
forth or contemplated in the General Disclosure Package and the Final Prospectus, which in
any such case makes it impracticable or inadvisable in the reasonable judgment of the
Representative to proceed with the public offering, sale or the delivery of the Warrants on
the terms and in the manner contemplated in the Final Prospectus;
(j) Since the time of execution of this Agreement and prior to the Time of Delivery,
none of the following events shall have occurred:
(i) (A) a declaration of a general moratorium on commercial banking activities
in the United States by the authorities that govern such banking systems
17
or a material disruption in the securities settlement or clearance systems in the United
States, which moratorium or disruption remains in effect and which, in your
reasonable judgment, substantially impairs your ability to settle the Warrants sold
hereunder; provided that the exercise of such judgment shall take into
account the availability of alternative means for settlement and the likely duration
of such moratorium or disruption with the understanding that if the Commission or,
with respect to a United States banking moratorium, the Board of Governors of the
Federal Reserve System has unequivocally stated prior to the Time of Delivery that
the resumption of such systems will occur within 3 business days of the Time of
Delivery for the Warrants sold hereunder, the ability to settle the
transaction shall not be deemed to be substantially impaired or (B) the United
States shall have become engaged in hostilities which have resulted in the
declaration of a national emergency or a declaration of war by the governmental
authorities empowered to make such declaration, which makes it impracticable or
inadvisable, in your reasonable judgment, to proceed with the public offering, sale
or the delivery of the Warrants sold hereunder on the terms and in the manner
contemplated in the General Disclosure Package and the Final Prospectus, or
(ii) (A) any suspension or limitation on trading in securities generally on the
NYSE, or any setting of minimum prices for trading on such exchange or market
system, (B) any suspension of trading of any securities of Ford on any exchange or
in the over-the-counter market or (C) any material outbreak or material escalation
of hostilities involving the engagement of armed conflict in which the United States
is involved or any other substantial national or international calamity or emergency
or (D) any material adverse change in the general economic, political, legal, tax,
regulatory or financial conditions or currency exchange rates in the United States
(whether resulting from events within or outside of the United States), that, in the
case of clause (A), (B), (C) or (D), in the reasonable determination of the
Representative, after consulting with the Company and the Selling Security Holder,
makes it impracticable or inadvisable to proceed with the public offering or the
delivery of the Warrants sold hereunder on the terms and in the manner contemplated
in the General Disclosure Package and the Final Prospectus; and
(k) The Company shall have furnished or caused to be furnished to the Representative,
at the Time of Delivery for the Warrants, certificates in form satisfactory to the
Representative in its reasonable judgment to the effect that:
(i) The representations and warranties of the Company contained in this
Agreement are true and correct on and as of such Time of Delivery as though made at
and as of such Time of Delivery;
18
(ii) The Company has duly performed, in all material respects, all obligations
required to be performed by it pursuant to the terms of this Agreement at or prior
to such Time of Delivery;
(iii) No stop order suspending the effectiveness of the Registration Statement
has been issued and no proceeding for that purpose has been initiated or, to the
knowledge of the Company, threatened by the Commission, the Statutory Prospectus,
the Final Prospectus and each Specified Issuer Free Writing Prospectus have been
timely filed with the Commission under the Act (in the case of a Specified Issuer
Free Writing Prospectus, to the extent required by Rule 433 under the Act), and all
requests for additional information on the part of the Commission have been complied
with or otherwise satisfied;
(iv) At the Time of Sale relating to the Warrants, the Registration Statement
did not contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the statements
therein not misleading; and
(v) At the Time of Sale relating to the Warrants and at the Time of Delivery,
each of the General Disclosure Package and the Final Prospectus does not contain any
untrue statement of a material fact or omit to state any material fact required to
be stated therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading;
provided, however, that no such certificate shall apply to any statements or
omissions made in reliance upon and in conformity with information (A) furnished in writing
to the Company by an Underwriter through the Representative expressly for use therein or (B)
any Selling Security Holder Information.
(l) The Selling Security Holder shall have furnished or caused to be furnished to the
Representative, at the Time of Delivery for the Warrants, certificates in form satisfactory
to the Representative in its reasonable judgment to the effect that:
(i) The representations and warranties of the Selling Security Holder contained
in this Agreement are true and correct on and as of such Time of Delivery as though
made at and as of such Time of Delivery; and
(iii) The Selling Security Holder has duly performed, in all material respects,
all obligations required to be performed by it pursuant to the terms of this
Agreement at or prior to such Time of Delivery.
7. (a) The Company will indemnify and hold harmless each Underwriter and the Selling Security
Holder against any losses, claims, damages or liabilities, joint or several, to which such
Underwriter may become subject with respect to the Warrants, under the Act or otherwise, insofar as
such losses, claims, damages or liabilities (or actions in respect thereof)
19
arise out of or are
based upon any untrue statement or alleged untrue statement of any material fact contained in the
Registration Statement, including without limitation the Rule 430B Information, the General
Disclosure Package, any Issuer Free Writing Prospectus, the Final Prospectus or any amendment or
supplement thereto with respect to the Warrants, 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 or the Selling
Security Holder, as the case may be, for any legal or other expenses reasonably incurred by such
Underwriter or the Selling Security Holder, as the case may be, in connection with investigating or
defending any such action or claim; 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 of such documents in reliance upon and
in conformity with (i) written information furnished to the Company by any Underwriter through
the Representative expressly for use therein or (ii) the Selling Security Holder Information.
The indemnity agreement in this subsection (a) shall be in addition to any liability which the
Company may otherwise have and shall extend, upon the same terms and conditions, (1) to the
trustees, officers, fiduciaries, employees, representatives and agents (including, without
limitation, IFS and its directors, officers, employees, representatives and agents) of the Selling
Security Holder and to each person, if any, who controls the Selling Security Holder within the
meaning of the Act, and (2) to each person, if any, who controls any Underwriter within the meaning
of the Act and each broker-dealer affiliate of any Underwriter.
(b) The Selling Security Holder agrees to indemnify and hold harmless the Company and each
Underwriter to the same extent as the foregoing indemnity from the Company to each Underwriter but
only with reference to the Selling Security Holder Information. The liability of the Selling
Security Holder under this indemnification provision shall be limited to an amount equal to the
gross proceeds received by the Selling Security Holder from the sale of the Warrants (net of
underwriting commissions paid to the Underwriters).
The indemnity agreement in this subsection (b) shall be in addition to any liability which the
Selling Security Holder may otherwise have and shall extend, upon the same terms and conditions,
(1) to the directors, officers, employees and agents of the Company and to each person, if any, who
controls the Company within the meaning of the Act, and (2) to each person, if any, who controls
any Underwriter within the meaning of the Act and each broker-dealer affiliate of any Underwriter.
(c) Each Underwriter, severally and not jointly, will indemnify and hold harmless the Company
and the Selling Security Holder against any losses, claims, damages or liabilities to which the
Company may become subject with respect to the Warrants, under the Act or otherwise, insofar as
such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are
based upon any untrue statement or alleged untrue statement of any material fact contained in the
Registration Statement, including without limitation the Rule 430B Information, the General
Disclosure Package, the Final Prospectus, or any amendment or
20
supplement thereto with respect to the Warrants, 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 of such documents in reliance upon and in conformity with written information
furnished to the Company by such Underwriter through the Representative expressly for use therein;
and will reimburse the Company or the Selling Security Holder, as the case may be, for any legal
fees or other expenses reasonably incurred by the Company or the Selling Security Holder, as the
case may be, in connection with investigating or defending any such action or claim.
The indemnity agreement in this subsection (c) shall be in addition to any liability which the
Underwriters may otherwise have and shall extend, upon the same terms and conditions, to the
officers and directors of the Company, the trustees and officers of the Selling Security Holder,
IFS and its directors and officers, and to each person, if any, who controls the Company or the
Selling Security Holder within the meaning of the Act.
(d) Promptly after receipt by an indemnified party under subsection (a), (b) or (c) above of
written 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, and in the event that such indemnified
party shall not so notify the indemnifying party within 30 days following receipt of any such
notice by such indemnified party, the indemnifying party shall have no further liability under such
subsection to such indemnified party unless such indemnifying party shall have received other
notice addressed and delivered in the manner provided in the second paragraph of Section 11 hereof
of the commencement of such action; 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 in its reasonable judgment, 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 or other expenses
subsequently incurred by such indemnified party in connection with the defense thereof other than
reasonable costs of investigation.
(e) If the indemnification provided for in this Section 7 is unavailable to an indemnified
party under subsection (a), (b) or (c) 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 Selling Security Holder on the one hand and the
Underwriters on the other from the offering of the Warrants to which such loss, claim, damage or
liability (or action in respect thereof) relates. If, however, the allocation provided by the
21
immediately preceding sentence is not permitted by applicable law, 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,
the Selling Security Holder and the Underwriters 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 Selling
Security Holder 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 Selling Security Holder bear to the total underwriting discounts and commissions received by
such Underwriters, in each case as set forth in the table on the cover page of the Final
Prospectus. 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, the Selling Security Holder
or such Underwriters and the parties relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The Company, the Selling Security
Holder and the Underwriters agree that it would not be just and equitable if contribution pursuant
to this subsection (e) 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 (e). 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 (e) 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 (e), no Underwriter shall be required to contribute any amount in excess of the amount
by which the total price at which the Warrants 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. In addition, notwithstanding the provisions of this subsection (e), the Selling Security
Holder shall not be required to contribute any amount in excess of the amount equal to the gross
proceeds received by the Selling Security Holder from the sale of the Warrants (net of underwriting
commissions paid to the Underwriters). No person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Act) shall be entitled to contribution from any person who was
not guilty of such fraudulent misrepresentation. The obligations of the Underwriters in this
subsection (e) to contribute are several in proportion to their respective underwriting obligations
with respect to the Warrants and not joint.
8. Default by Underwriters; Default by Selling Security Holder.
(a) If any Underwriter shall default in its obligation to purchase the Underwriters Warrants
which it has agreed to purchase under this Agreement, the Representative may in its discretion
arrange for itself or for another party or other parties to purchase such Underwriters Warrants on
the terms contained herein. If within 36 hours after such default by any Underwriter, the
Representative does not arrange for the purchase of such Underwriters Warrants, then the Company
and the Selling Security Holder shall be entitled to a
22
further period of 36 hours within which to procure another party or other parties to purchase such
Underwriters Warrants on such terms. In the event that, within the respective prescribed periods,
the Representative notifies the Company and the Selling Security Holder that it has so arranged for
the purchase of such Underwriters Warrants, or the Company or the Selling Security Holder notifies
the Representative that it has so arranged for the purchase of such Underwriters Warrants, the
Representative, the Company or the Selling Security Holder, as the case may be, shall have the
right to postpone the Time of Delivery for such Underwriters Warrants 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 Final Prospectus, or any other documents or arrangements, and the
Company agrees to file promptly any amendments or supplements to the Registration Statement or the
Final Prospectus which in the opinion of Shearman & Sterling LLP and counsel for the Company
referred to in Section 6(d) hereof 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 it
had originally been a party to this Agreement. In the event that none of the Representative, the
Company or the Selling Security Holder arrange for another party or parties to purchase such
Underwriters Warrants as provided in this Section, the Selling Security Holder shall have the
right to require each non-defaulting Underwriter to purchase and pay for the Underwriters Warrants
which such non-defaulting Underwriter agreed to purchase under this Agreement and, in addition, to
require each such non-defaulting Underwriter to purchase the Underwriters Warrants which the
defaulting Underwriter or Underwriters shall have so failed to purchase up to an amount thereof
equal to 10% of the aggregate principal amount of the Underwriters Warrants which such
non-defaulting Underwriter has otherwise agreed to purchase under this Agreement; provided,
however, that if the aggregate principal amount of Underwriters Warrants which any such
defaulting Underwriter or Underwriters shall have so failed to purchase is more than one-eleventh
of the aggregate number of the Underwriters Warrants, then this Agreement may be terminated by the
Selling Security Holder or, through the Representative, by such Underwriters as have agreed to
purchase in the aggregate 50% or more of the remaining Underwriters Warrants under this Agreement,
without liability on the part of any non-defaulting Underwriter, the Company or the Selling
Security Holder, except for the expenses referred to in Section 5(A)(f) hereof and the
indemnification provided in Section 7 hereof; but nothing herein shall relieve a defaulting
Underwriter from liability for its default.
(b) If the Selling Security Holder shall fail at the Time of Delivery to sell and deliver the
number of Warrants which the Selling Security Holder is obligated to sell hereunder then the
Underwriters may, at the option of the Representative, by notice from the Representative to the
Company and the Selling Security Holder, terminate this Agreement without any liability on the part
of any non-defaulting party, except to the extent provided in Sections 5(A)(f) and 7 hereof. Any
action taken under this Section 8(b) shall not relieve the Selling Security Holder from liability
in respect of any default under this Agreement.
9. The respective indemnities, agreements, representations, warranties and other statements of
the Underwriters, the Company and the Selling Security Holder hereunder, as set forth in this
Agreement or made by them, respectively, pursuant to this Agreement, shall remain
23
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, the Selling Security Holder or the Company or any of
its officers or directors or any controlling person, and shall survive delivery of and payment for
the Warrants.
10. If this Agreement shall be terminated pursuant to Section 8(a) hereof, or if any Warrants
are not delivered by the Selling Shareholder because the condition set forth in Section 6(j) has
not been met, then the Company and the Selling Shareholder shall be under no liability to any
Underwriter with respect to the Warrants except as provided in Section 5(A)(f) and Section 7
hereof. If this Agreement is terminated or the sale of any Warrants as provided herein is not
consummated for any other reason, the Underwriters, through the Representative, shall be reimbursed
for all out-of-pocket expenses, including counsel fees and disbursements, as approved in writing by
the Representative, reasonably incurred by the Underwriters in making preparations for the
purchase, sale and delivery of the Warrants, but the Company and the Selling Shareholder shall then
have no further liability to any Underwriter with respect to the Warrants except as provided in
Section 5(A)(f) and Section 7 hereof. The obligation to reimburse the Underwriters set forth in
the immediately preceding sentence shall be (i) the Companys, if such termination or failure to
consummate the sale of Warrants is because of any refusal, inability or failure on the part of the
Company to perform any obligation required to be performed by it pursuant to the terms of this
Agreement or to satisfy any of the conditions set forth in Sections 6(a), 6(b) (except to the
extent that the Companys failure to satisfy its obligation under Section 6(b) is the result of the
Selling Security Holders failure to consent to the Warrant Amendment), 6(c), 6(d), 6(e), 6(h),
6(i) and 6(k), or (ii) the Selling Shareholders, if such termination or failure to consummate the
sale of Warrants is because of any refusal, inability or failure on the part of the Selling
Shareholder to perform any obligation required to be performed by it pursuant to the terms of this
Agreement or to satisfy any of the conditions set forth in Sections 6(g) and 6(l).
11. In all dealings with the Company and the Selling Security Holder under this Agreement, the
Representative shall act on behalf of each of such Underwriters, and the Company and Selling
Security Holder shall be entitled to act and rely upon any statement, request, notice or agreement
on behalf of any Underwriter made or given by the Representative.
All statements, requests, notices and agreements hereunder shall be in writing, or by telegram
if promptly confirmed in writing, and if to the Representative or the Underwriters shall be
sufficient in all respects if delivered or sent by registered mail to the Representative, if to the
Company shall be sufficient in all respects if delivered or sent by registered mail to the Company
at One American Road, Dearborn, Michigan 48126, attention of the Secretary, if to the Selling
Security Holder shall be sufficient in all respects if delivered or sent by registered mail to the
Selling Security Holder at UAW Retiree Medical Benefits Trust, c/o Independent Fiduciary Services,
Inc., 805 15th Street, NW, Suite 1120, Washington, DC 20005, Attention: Mr. Samuel W. Halpern,
President; provided, however, that any notice to an Underwriter pursuant to Section
7(d) hereof shall be delivered or sent by registered mail directly to such Underwriter at its
24
address set forth in its Underwriters Questionnaire, or telex constituting such Questionnaire,
which address will be supplied to the Company by the Representative upon request.
12. This Agreement shall be binding upon, and inure solely to the benefit of, the
Underwriters, the Company and the Selling Security Holder, and to the extent provided in Section 7
and Section 9 hereof, the officers and directors of the Company, the trustees, officers and
fiduciaries of the Selling Security Holder and any person who controls any Underwriter, the Company
or the Selling Security Holder, and their respective personal representatives, successors and
assigns, and no other person shall acquire or have any right under or by virtue of this Agreement.
No purchaser of any of the Warrants from any Underwriter shall be construed a successor or assign
by reason merely of such purchase.
13. Each Underwriter acknowledges that the Selling Security Holder is subject to ERISA.
14. This Agreement shall be governed by, and construed in accordance with, the laws of the
State of New York.
15. This Agreement may be executed by each of the parties hereto in any number of
counterparts, and by each of the parties hereto on separate counterparts, each of which
counterparts, when so executed and delivered, shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same instrument.
25
If the foregoing is in accordance with your understanding, please sign and return to us a
counterpart hereof, whereupon this letter and your acceptance hereof shall constitute a binding
agreement.
Very truly yours, FORD MOTOR COMPANY |
||||
By: | /s/ David M. Brandi | |||
Name: | David M. Brandi | |||
Title: | Assistant Treasurer | |||
UAW RETIREE MEDICAL BENEFITS TRUST |
||||
By: | INDEPENDENT FIDUCIARY SERVICES, INC., | |||
solely as named fiduciary and investment manager to, and on behalf of, the UAW Retiree Medical Benefits Trust with respect to the Warrants held in the Ford Separate Retiree Account | ||||
By: | /s/ Samuel Halpern | |||
Name: | Samuel Halpern | |||
Title: | President |
Accepted as of the date hereof: DEUTSCHE BANK SECURITIES INC. |
||||
By: | /s/ Jeff Mortala | |||
Name: | Jeff Mortala | |||
Title: | Managing Director | |||
By: | /s/ Warren F. Estey | |||
Name: | Warren F. Estey | |||
Title: | Managing Director |
SCHEDULE I
Number of Warrants | ||||||||
Underwriters | to be Purchased | |||||||
Deutsche Bank Securities Inc. |
226,494,753 | (62.500 | %) | |||||
Goldman, Sachs & Co. |
67,948,426 | (18.750 | %) | |||||
Barclays Capital Inc. |
11,324,738 | (3.125 | %) | |||||
Merrill Lynch, Pierce, Fenner & Smith
Incorporated |
11,324,738 | (3.125 | %) | |||||
Citigroup Global Markets Inc. |
11,324,738 | (3.125 | %) | |||||
J.P. Morgan Securities Inc. |
11,324,738 | (3.125 | %) | |||||
Morgan Stanley & Co. Incorporated |
11,324,737 | (3.125 | %) | |||||
RBS Securities Inc. |
11,324,737 | (3.125 | %) | |||||
Total |
362,391,605 | (100.000 | %) |