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_________ Shares
AJL PEPS TRUST
PREMIUM EXCHANGEABLE PARTICIPATING SHARES
UNDERWRITING AGREEMENT
November __, 1995
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November __, 1995
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated
c/o Morgan ▇▇▇▇▇▇▇ & Co.
Incorporated
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. International Limited
▇▇▇▇▇▇▇ ▇▇▇▇▇ International Limited
c/o Morgan ▇▇▇▇▇▇▇ & Co. International Limited
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇ ▇▇▇
England
Dear Sirs:
ATL PEPS Trust, a trust duly created under the laws of the
State of New York (such trust and the trustees thereof acting in their
capacities as such being referred to herein as the "Trust"), proposes to issue
and sell to the several Underwriters (as defined below) _________ shares (the
"Firm PEPS Shares") of its Premium Exchangeable Participating Shares.
It is understood that, subject to the conditions hereinafter
stated, _______________ Firm PEPS Shares (the "U.S. Firm PEPS Shares") will be
sold to the several U.S. Underwriters named in Schedule I hereto (the "U.S.
Underwriters") in connection with the offering and sale of such U.S. Firm Shares
in the United States and Canada to United States and Canadian Persons (as such
terms are defined in the Agreement Between U.S. and International Underwriters
of even date herewith), and _____________ Firm PEPS Shares (the "International
PEPS Shares") will be sold to the several International Underwriters named in
Schedule II hereto (the "International Underwriters") in connection with the
offering and sale of such International PEPS Shares outside the United States
and Canada to persons other than United States and Canadian Persons. ▇▇▇▇▇▇
▇▇▇▇▇▇▇ & Co. Incorporated and ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated shall act as representatives (the "U.S. Representatives") of the
several U.S. Underwriters, and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. International Limited and
▇▇▇▇▇▇▇ ▇▇▇▇▇
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International Limited shall act as representatives (the "International
Representatives") of the several International Underwriters. The U.S.
Underwriters and the International Underwriters are hereinafter collectively
referred to as the Underwriters.
The Trust also proposes to issue and sell to the several U.S.
Underwriters not more than an additional ________ shares of its Premium
Exchangeable Participating Shares (the "Additional PEPS Shares") if and to the
extent that the U.S. Representatives shall have determined to exercise, on
behalf of the U.S. Underwriters, the right to purchase such shares granted to
the U.S. Underwriters in Section 2 hereof. The Firm PEPS Shares and the
Additional PEPS Shares are hereinafter collectively referred to as the "PEPS
Shares." The shares of Premium Exchangeable Participating Shares of the Trust to
be outstanding after giving effect to the sales contemplated hereby are
hereinafter referred to as the "Premium Exchangeable Participating Shares."
Each Premium Exchangeable Participating Share will be
exchanged for American Depositary Shares ("ADSs") or, at the option of the
holder thereof, the equivalent in shares of Common Stock, of Amway Japan Limited
(the "Company") on February __, 1999 (the "Exchange Date") to be delivered
pursuant to a purchase contract (the "HDV Purchase Contract") among the Trust
and HDV GRIT Holdings, Inc., a Michigan corporation ("HDV, Inc."), and HDV
Grantor Retained Income Trust, a trust duly created under the laws of the State
of [________] (such trust and the trustees thereof acting in their capacities as
such being referred to herein as the "HDV Group") and a purchase contract (the
"JVA Purchase Contract" and, collectively with the HDV Purchase Contract, the
"Purchase Contracts") among the Trust, the ▇▇▇ ▇▇▇ ▇▇▇▇▇ Trust, a trust
organized under the laws of the State of [__________] (such trust and the
trustees thereof acting in their capacities as such being referred to as "JVA
Trust" and, collectively with HDV, Inc., the "Sellers"), and ▇▇▇ ▇▇▇ ▇▇▇▇▇ (▇▇▇
▇▇▇ ▇▇▇▇▇ and JVA Trust are hereinafter referred to as the "JVA Group"). The
Trust has entered into the Purchase Contracts with each of the Sellers pursuant
to which each Seller has agreed to sell, and the Trust has agreed to purchase,
the number of ADSs deliverable by such Seller on, or immediately prior to, the
Exchange Date. Each Seller's obligations under its respective Purchase Contract
will be secured by a pledge of collateral pursuant to the terms of a collateral
agreement between such Seller and The Bank of New York, as collateral agent
(each a "Collateral Agreement" and, collectively, the "Collateral Agreements").
The shares of Common Stock, no par value, of the Company
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outstanding on the date hereof are hereinafter referred to as the "Common
Stock". Each ADS represents one-half of one share of Common Stock and is
evidenced by an American Depositary Receipt (an "ADR") which is issued by ▇▇▇▇▇▇
Guaranty Trust Company of New York, as Depositary (the "Depositary") under a
Deposit Agreement dated as of February 18, 1993, as amended and restated as of
May 12, 1994 (the "Deposit Agreement"), among the Company, the Depositary and
the holders from time to time of ADRs.
The Trust has filed with the Securities and Exchange
Commission (the "Commission") a notification on Form N-8A (the "Notification")
of registration of the Trust as an investment company and a registration
statement on Form N-2, relating to the PEPS Shares. The registration statement
contains two prospectuses to be used in connection with the offering and sale of
the PEPS Shares: the U.S. prospectus, to be used in connection with the offering
and sale of PEPS Shares in the United States and Canada to United States and
Canadian Persons, and the international prospectus, to be used in connection
with the offering and sale of PEPS Shares outside the United States and Canada
to persons other than United States and Canadian persons. The international
prospectus is identical to the U.S. prospectus except for the outside front
cover page. The registration statement as amended at the time it becomes
effective, including the information (if any) deemed to be part of the
registration statement at the time of effectiveness pursuant to Rule 430A under
the Securities Act of 1933, as amended, is hereinafter referred to as the "Trust
Registration Statement"; the U.S. and international prospectuses in the
respective forms first used to confirm sales of PEPS Shares are hereinafter
collectively referred to as the "Trust Prospectus." If the Trust has filed an
abbreviated registration statement to register additional shares of Premium
Exchangeable Participating Shares pursuant to Rule 462(b) under the Securities
Act (the "Rule 462 Trust Registration Statement"), then any reference herein to
the term "Trust Registration Statement" shall be deemed to include such Rule 462
Trust Registration Statement.
The Securities Act of 1933, as amended, and the rules and
regulations of the commission thereunder are collectively referred to as the
"Securities Act;" the Investment Company Act of 1940, as amended, and the rules
and regulations of the Commission thereunder are collectively referred to as the
"Investment Company Act;" and the Securities Act and the Investment Company Act
are collectively referred to as the "Acts."
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The Company has filed with the Commission a registration
statement under the Securities Act on Form F-3 (File No. 33-63469), including a
prospectus, with respect to the shares of Common Stock underlying the ADSs
deliverable pursuant to the Purchase Contracts, has filed such amendments
thereto, if any, and such amended preliminary prospectuses as may have been
required to the date hereof, and will file such additional amendments thereto
and such amended prospectuses as may hereafter be required. Such registration
statement as amended at the time it becomes effective, including the information
(if any) deemed to be part of such registration statement at the time of
effectiveness pursuant to Rule 430A under the Securities Act and any information
incorporated by reference therein pursuant to amendment or supplement from time
to time under the Securities Act, the Securities Exchange Act of 1934, as
amended (together with the rules and regulations thereunder the "Exchange Act")
or otherwise is hereinafter referred to as the "Company Registration Statement";
the prospectus included within the Company Registration Statement at the time
the Company Registration Statement was declared effective is hereinafter
referred to as the "Company Prospectus," except that if any revised prospectus
shall be prepared by the Company for use by the Underwriters which differs from
the Company Prospectus on file at the Commission at the time the Company
Registration Statement becomes effective (whether or not such revised prospectus
is required to be filed by the Company pursuant to Rule 424(b) of the Securities
Act), the term "Company Prospectus" shall refer to such revised prospectus from
and after the time it is first provided to the Underwriters for use and if the
Company files any documents pursuant to Section 13 or 15 of the Exchange Act
after the Company Registration Statement becomes effective and prior to the
termination of the offering of the Shares by the Underwriters, which documents
are deemed to be incorporated by reference into the Company Prospectus, the term
"Company Prospectus" shall refer to said prospectus as supplemented by the
documents so filed from and after the time said documents are filed with the
Commission. The Trust Registration Statement and the Company Registration
Statement are hereinafter collectively referred to as the "Registration
Statements," and the Trust Prospectus and the Company Prospectus are hereinafter
collectively referred to as the "Prospectuses."
1. REPRESENTATIONS OF THE TRUST, THE SELLERS AND THE
COMPANY. (a) The Trust represents and warrants to and agrees with each of the
Underwriters, the Sellers and the Company that:
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(i) The Trust Registration Statement has become effective; no
stop order suspending the effectiveness of the Trust Registration
Statement is in effect, and no proceedings for such purpose are pending
before or threatened by the Commission.
(ii) The Trust has been duly created, is validly existing as a
trust under the laws of the State of New York, has the power and
authority to conduct its business as described in the Trust Prospectus
and to enter into and perform its obligations under this Agreement and
the Amended and Restated Trust Agreement dated as of November [__],
1995 among the trustees of the Trust (the "Trustees") and ▇▇▇▇▇▇
▇▇▇▇▇▇▇ & Co. Incorporated, as Sponsor (the "Trust Agreement"). The
Trust has no subsidiaries.
(iii) The Trust is registered with the Commission as a
non-diversified, closed-end management investment company under the
Investment Company Act and no order of suspension or revocation of such
registration has been issued or proceedings therefor initiated or, to
the knowledge of the Trust, threatened by the Commission. No person is
serving or acting as an officer or trustee of, the Trust except in
accordance with the provisions of the Investment Company Act.
(iv) This Agreement has been duly authorized, executed and
delivered by the Trust.
(v) Each of the Purchase Contracts, the Collateral Agreements,
the Administration Agreement between The Bank of New York ("BONY") and
the Trust (the "Administration Agreement"), the Custodian Agreement
between BONY and the Trust (the "Custodian Agreement") the Paying Agent
Agreement between BONY and the Trust (the "Paying Agent Agreement") and
the Fund Indemnity Agreement between ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
and the Trust (the "Fund Indemnity Agreement") (the Purchase Contracts,
the Collateral Agreement, the Administration Agreement, the Custodian
Agreement, the Paying Agent Agreement and the Fund Indemnity Agreement
are referred to herein, collectively, as the "Fundamental Agreements")
has been duly authorized, executed and delivered by the Trust and,
assuming due authorization, execution and delivery by the other parties
thereto, is a valid and binding agreement of the Trust, enforceable
against the Trust in accordance with its terms except as (i) such
enforceability may be limited by applicable bankruptcy, insolvency or
similar laws affecting creditors' rights
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generally and (ii) the availability of equitable remedies may be
limited by equitable principles of general applicability.
(vi) None of (A) the execution and delivery by the Trust of,
and the performance by the Trust of its obligations under, this
Agreement and each Fundamental Agreement, or (B) the issue and sale by
the Trust of the PEPS Shares as contemplated by this Agreement
contravenes or will contravene any provision of applicable law or the
Trust Agreement or any agreement or other instrument binding upon the
Trust that is material to the Trust, or any judgment, order or decree
of any governmental body, agency or court having jurisdiction over the
Trust, whether foreign or domestic, and no consent, approval,
authorization, order of, or qualification with, any governmental body
or agency, self-regulatory organization or court or other tribunal,
whether foreign or domestic, is required for the performance by the
Trust of its obligations under this Agreement or the Fundamental
Agreements, except such as have been obtained and as may be required by
the securities or Blue Sky laws of the various states and foreign
jurisdictions in connection with the offer and sale of the PEPS Shares
by the Underwriters.
(vii) The authorized capital stock of the Trust conforms in
all material respects to the description thereof contained in the Trust
Prospectus, and the Trust Agreement and the Fundamental Agreements
conform in all material respects to the descriptions thereof contained
in the Trust Prospectus.
(viii) The Trust Agreement and the Fundamental Agreements
comply with all applicable provisions of the Acts, and all approvals of
such documents required under the Investment Company Act by the holders
of the Premium Exchangeable Participating Shares of the Trust and the
Trustees have been obtained and are in full force and effect.
(ix) The Fundamental Agreements are in full force and effect
and the Trust is not in default thereunder and, to the knowledge of the
Trust, no event has occurred which with the passage of time or the
giving of notice or both would constitute a default thereunder. The
Trust is not currently in breach of, or in default under, any other
written agreement or instrument to which it or its property is bound or
affected.
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(x) The shares of Premium Exchangeable Participating Shares
outstanding prior to the issuance of the PEPS Shares have been duly
authorized and are validly issued, fully paid and non-assessable and
the form of certificates used to evidence the shares of Premium
Exchangeable Participating Shares is in due and proper form and
complies with all provisions of applicable law.
(xi) The PEPS Shares have been duly authorized and, when
issued and delivered in accordance with the terms of this Agreement,
will be validly issued, fully paid and non-assessable, and the issuance
of such PEPS Shares will not be subject to any preemptive or similar
rights. No person has rights to the registration of any securities
because of the filing of the Trust Registration Statement.
(xii) The PEPS Shares and any outstanding shares of Premium
Exchangeable Participating Shares prior to the issuance of the PEPS
Shares have been approved for listing on the New York Stock Exchange,
Inc. (the "New York Stock Exchange"), subject to official notice of
issuance. The Trust's Registration Statement on Form 8-A under the
Exchange Act is effective.
(xiii) There has not occurred any material adverse change, or
any development involving a prospective material adverse change, in the
condition, financial or otherwise, of the Trust, or in the investment
objectives, investment policies, liabilities, business, prospects or
operations of the Trust from that set forth in the Trust Prospectus
(exclusive of any supplements thereto subsequent to the date of this
Agreement) and there have been no transactions entered into by the
Trust which are material to the Trust other than those in the ordinary
course of its business or as described in the Trust Prospectus
(exclusive of any supplements thereto subsequent to the date of this
Agreement).
(xiv) There are no legal or governmental proceedings pending
or, to the knowledge of the Trust, threatened against or affecting the
Trust that are required to be described in the Trust Registration
Statement or the Trust Prospectus and are not so described or any
statutes, regulations, contracts or other documents that are required
to be described in the Trust Registration Statement or the Trust
Prospectus or to be filed as exhibits to the Trust
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Registration Statement that are not described or filed as required.
(xv) The Trust has all necessary consents, authorizations,
approvals, orders (including exemptive orders), certificates and
permits of and from, and has made all declarations and filings with,
all governmental authorities, self-regulatory organizations and courts
and other tribunals, whether foreign or domestic, to own and use its
assets and to conduct its business in the manner described in the Trust
Prospectus, except to the extent that the failure to obtain or file the
foregoing would not have a material adverse effect on the Trust and
except such as may be required by the securities or Blue Sky laws of
the various states in connection with the offer and sale of the PEPS
Shares.
(xvi) Each preliminary prospectus filed as part of the Trust
Registration Statement as originally filed or as part of any amendment
thereto, or filed pursuant to Rule 497 under the Securities Act,
complied when so filed in all material respects with the Acts.
(xvii) (A) Each part of the Trust Registration Statement, when
such part became effective, did not contain and each such part, as
amended or supplemented, if applicable, will not contain any 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, (B) the Trust Registration Statement, the Notification and
the Trust Prospectus comply and, as amended or supplemented, if
applicable, will comply in all material respects with the Acts and (C)
the Trust Prospectus does not contain and, as amended or supplemented,
if applicable, will not contain any untrue statement of a material fact
or omit to state a material fact necessary to make the statements
therein, in the light of the circumstances under which they were made,
not misleading, except that the representations and warranties set
forth in this paragraph (xvii) do not apply to statements or omissions
in the Trust Registration Statement or the Trust Prospectus based upon
information furnished to the Trust in writing by such Underwriter
through you expressly for use therein.
(xviii) There are no material restrictions, limitations or
regulations with respect to the ability of the Trust to invest its
assets as described in the Trust Prospectus, other than as described
therein.
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(xix) The accountants who certified the financial statements
and supporting schedules included in the Trust Registration Statement
are independent public accountants as required by the Securities Act.
(xx) The Trust has complied with all provisions of Section
517.075, Florida Statutes relating to doing business with the
Government of Cuba or with any person or affiliate located in Cuba.
(b) The HDV Group represents and warrants to and agrees with
each of the Underwriters, the Company and the Trust that:
(i) HDV, Inc. has been duly formed, is validly existing as a
corporation in good standing under the laws of the State of Michigan,
has the power and authority to own its property and to conduct its
business and is duly qualified to transact business and is in good
standing in each jurisdiction in which the conduct of its business or
its ownership or leasing of property requires such qualification,
except to the extent that the failure to be so qualified or be in good
standing would not have a material adverse effect on HDV, Inc. HDV,
Inc. has no subsidiaries.
(ii) HDV Trust has been duly created, is validly existing as a
trust under the laws of the State of ________, has the power and
authority to own its property and to conduct its business and is duly
qualified to transact business in each jurisdiction in which the
conduct of its business or its ownership or leasing of property
requires such qualification, except to the extent that the failure to
be so qualified would not have a material adverse effect on HDV Trust.
HDV Trust has no subsidiaries.
(iii) This Agreement has been duly authorized, executed and
delivered by or on behalf of the HDV Group.
(iv) Each of the HDV Purchase Contract, the Collateral
Agreement of the HDV Group and the letter agreement from the Sellers to
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated relating to expenses of the Trust
(the "Reimbursement Agreement") has been duly authorized, executed and
delivered by or on behalf of the HDV Group and, assuming due
authorization, execution and delivery by the other parties thereto, is
a valid and binding agreement of the HDV Group, enforceable against the
HDV
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Group in accordance with its terms except as (i) such enforceability
may be limited by applicable bankruptcy, insolvency or similar laws
affecting creditors' rights generally and (ii) the availability of
equitable remedies may be limited by equitable principles of general
applicability.
(v) The execution and delivery by the HDV Group of, and the
performance by the HDV Group of its obligations under, this Agreement,
the HDV Purchase Contract, the Collateral Agreement and the
Reimbursement Agreement will not contravene any provision of applicable
law, or the certificate of incorporation of HDV, Inc., the by-laws of
HDV, Inc. or the applicable constitutive documents of HDV Trust, or any
agreement or other instrument binding upon the HDV Group that is
material to HDV, Inc. or HDV Trust or any judgment, order or decree of
any governmental body, agency or court having jurisdiction over
HDV,Inc. or HDV Trust, whether foreign or domestic, and no consent,
approval, authorization or order of, or qualification with, any
governmental body or agency, self-regulatory organization or court or
other tribunal, whether foreign or domestic, is required for the
performance by the HDV Group of its obligations under this Agreement,
the HDV Purchase Contract, its Collateral Agreement or the
Reimbursement Agreement, except such as have been obtained and as may
be required by the securities or Blue Sky laws of the various states
and foreign jurisdictions in connection with the sale of ADSs by HDV,
Inc. pursuant to the HDV Purchase Contract.
(vi) HDV, Inc. is not an "investment company" or an entity
"controlled" by an "investment company" as such terms are defined in
the Investment Company Act.
(vii) HDV, Inc. (or its direct or indirect nominee) has, and
on the Closing Date will have, good and valid title to the ADSs to be
pledged and assigned by it under its Collateral Agreement, free and
clear of any security interests, claims, liens, equities and other
encumbrances, except for those created pursuant to its Collateral
Agreement, and has the legal right and power, and all authorization and
approval required by law to pledge and assign the ADSs to be pledged
and assigned by HDV,Inc. pursuant to its Collateral Agreement.
(viii) Assuming payment of the purchase price on the Closing
Date, delivery of the ADSs to be sold by HDV, Inc. pursuant to the HDV
Purchase Contract on the
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Exchange Date will pass to the holders of the PEPS Shares title to such
ADSs free and clear of any security interests, claims, liens, equities
and other encumbrances, except for those created pursuant to the
Collateral Agreement of HDV, Inc.
(ix) The representations and warranties of the HDV Group set
forth in Section [__] of the HDV Purchase Contract and in Section [__]
of the Collateral Agreement of the HDV Group are true and correct on
and as of the date hereof with the same effect as though such
representations and warranties had been set forth in full in this
Agreement.
(x) For the purposes described in Section 12 hereof, under the
laws of the State of New York relating to submission to jurisdiction,
the HDV Group has validly and irrevocably submitted to the jurisdiction
of any State or Federal court located in the Borough of Manhattan, The
City of New York, New York, has validly and irrevocably waived any
objection to the venue of a proceeding in any such court, and has
validly and irrevocably appointed CT Corporation System as its
authorized agent for service of process.
(c) the JVA Group represents and warrants to and agrees with
each of the Underwriters, the Company and the Trust that:
(i) JVA Trust has been duly created, is validly existing as a
trust under the laws of the State of ________, has the power and
authority to own its property and to conduct its business and is duly
qualified to transact business in each jurisdiction in which the
conduct of its business or its ownership or leasing of property
requires such qualification, except to the extent that the failure to
be so qualified would not have a material adverse effect on JVA Trust.
JVA Trust has no subsidiaries.
(ii) This Agreement has been duly authorized, executed and
delivered by or on behalf of the JVA Group.
(iii) Each of the JVA Purchase Contract, the Collateral
Agreement of the JVA Group and the Reimbursement Agreement has been
duly authorized, executed and delivered by or on behalf of the JVA
Group and, assuming due authorization, execution and delivery by the
other parties thereto, is a valid and binding
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agreement of the JVA Group, enforceable against the JVA Group in
accordance with its terms except as (i) such enforceability may be
limited by applicable bankruptcy, insolvency or similar laws affecting
creditors' rights generally and (ii) the availability of equitable
remedies may be limited by equitable principles of general
applicability.
(iv) The execution and delivery by the JVA Group of, and the
performance by the JVA Group of its obligations under, this Agreement,
the JVA Purchase Contract, Collateral Agreement of the JVA Group and
the Reimbursement Agreement will not contravene any provision of
applicable law, or applicable constitutive documents of JVA Trust, or
any agreement or other instrument binding upon the JVA Group that is
material to JVA Trust or ▇▇▇▇ ▇▇▇ ▇▇▇▇▇ or any judgment, order or
decree of any governmental body, agency or court having jurisdiction
over JVA Trust or ▇▇▇▇ ▇▇▇ ▇▇▇▇▇, whether foreign or domestic, and no
consent, approval, authorization or order of, or qualification with,
any governmental body or agency, self-regulatory organization or court
or other tribunal, whether foreign or domestic, is required for the
performance by the JVA Group of its obligations under this Agreement,
the JVA Purchase Contract, its Collateral Agreement or the
Reimbursement Agreement, except such as have been obtained and as may
be required by the securities or Blue Sky laws of the various states
and foreign jurisdictions in connection with the sale of ADSs by JVA
Trust pursuant to the JVA Purchase Contract.
(v) JVA Trust is not an "investment company" or an entity
"controlled" by an "investment company" as such terms are defined in
the Investment Company Act.
(vi) JVA Trust (or its direct or indirect nominee) has, and on
the Closing Date will have, good and valid title to the ADSs to be
pledged and assigned by it under its Collateral Agreement, free and
clear of any security interests, claims, liens, equities and other
encumbrances, except for those created pursuant to its Collateral
Agreement, and has the legal right and power, and all authorization and
approval required by law, to pledge and assign the ADSs to be pledged
and assigned by JVA Trust pursuant to its Collateral Agreement.
(vii) Assuming payment of the purchase price on the Closing
Date, delivery of the ADSs to be sold by JVA Trust pursuant to the JVA
Purchase Contract on the
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Exchange Date will pass to the holders of the PEPS Shares title to such
ADSs free and clear of any security interests, claims, liens, equities
and other encumbrances, except for those created pursuant to the
Collateral Agreement of JVA Trust.
(viii) The representations and warranties of the JVA Group
Seller set forth in Section [__] of the JVA Purchase Contract and in
Section [__] of the Collateral Agreement of the JVA Group are true and
correct on and as of the date hereof with the same effect as though
such representations and warranties had been set forth in full in this
Agreement.
(ix) For the purposes described in Section 12 hereof, under
the laws of the State of New York relating to submission to
jurisdiction, the JVA Group has validly and irrevocably submitted to
the jurisdiction of any State or Federal court located in the Borough
of Manhattan, The City of New York, New York, has validly and
irrevocably waived any objection to the venue of a proceeding in any
such court, and has validly and irrevocably appointed CT Corporation
System as its authorized agent for service of process.
(d) The Company represents and warrants to and agrees with
each of the Underwriters, the Trust and the Sellers that:
(i) The Company Registration Statement has become effective;
no stop order suspending the effectiveness of the Company Registration
Statement is in effect, and, to the best knowledge of the Company, no
proceedings for such purpose are pending before or threatened by the
Commission.
(ii) (A) Each part of the Company Registration Statement, when
such part became effective, did not contain and each such part, as
amended or supplemented, if applicable, will not contain any 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, (B) the Company Registration Statement and the Company
Prospectus comply as to form and, as amended or supplemented, if
applicable, will comply as to form in all material respects with the
Securities Act and (C) the Company Prospectus does not contain and, as
amended or supplemented, if applicable, will not contain any untrue
statement of a material fact or omit to state a material fact necessary
to make the statements therein,
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in the light of the circumstances under which they were made, not
misleading, except that the representations and warranties set forth in
this Section 1(c)(ii) do not apply to statements or omissions in the
Company Registration Statement or the Company Prospectus based upon
information furnished to the Company in writing by such Underwriter
through you expressly for use therein.
(iii) (A) A registration statement in respect of the ADSs
evidenced by ADRs on Form F-6 has been filed with, and declared
effective by, the Commission (such registration statement, including
all exhibits thereto, at the time it became effective, being
hereinafter called the "ADS Registration Statement"), (B) each part of
the ADS Registration Statement, when such part became effective, did
not contain, and each such part, as amended or supplemented, if
applicable, will not contain, any 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, (C) copies of
the ADS Registration Statement have heretofore been delivered to you
and, excluding exhibits, to you for each of the other Underwriters, (D)
no other document with respect to the ADS Registration Statement has
heretofore been filed with the Commission, and (E) the ADS Registration
Statement, when it became effective, conformed in all material respects
to the requirements of the Securities Act.
(iv) The Company has been duly incorporated, is validly
existing as a corporation under the laws of Japan, has the corporate
power and authority to own its property and to conduct its business as
described in the Company Prospectus and is duly qualified to transact
business and is in good standing in each jurisdiction in which the
conduct of its business or its ownership or leasing of property
requires such qualification, except to the extent that the failure to
be so qualified would not have a material adverse effect on the Company
and the Subsidiary (as defined below), taken as a whole.
(v) The only subsidiary of the Company is Amway Japan
Enterprises, Inc., a Delaware corporation (the "Subsidiary"). The
Subsidiary has been duly incorporated, is validly existing as a
corporation in good standing under the laws of the State of Delaware,
has the corporate power and authority to own its property and to
conduct its business as described in the Company Prospectus and is duly
qualified to
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16
transact business and is not required to be registered
or qualified in any other jurisdiction.
(vi) This Agreement has been duly authorized, executed and
delivered by the Company.
(vii) The authorized capital stock of the Company conforms as
to legal matters to the description thereof contained in the Company
Prospectus.
(viii) The shares of Common Stock may be freely deposited by
any registered holder thereof with the Depositary against issuance of
ADRs evidencing ADSs; the ADSs are freely transferable by the Sellers
to the Trust in the manner contemplated in this Agreement, the Purchase
Contracts and the Collateral Agreements;
(ix) The Deposit Agreement is in full force and effect and
neither the Company nor, to the Company's knowledge, any other party to
such agreement is in default thereunder and, to the knowledge of the
Company, no event has occurred that with the passage of time or the
giving of notice or both would constitute a default thereunder. The
Company is not currently in breach of, or in default under, any other
written agreement or instrument to which it or its property is bound or
affected except to the extent that such breach or default would not
have a material adverse effect on the Company. Upon due issuance by the
Depositary of ADRs evidencing ADSs against the deposit of shares of
Common Stock in respect thereof in accordance with the provisions of
the Deposit Agreement, such ADRs will be duly and validly issued and
the person in whose names the ADRs are registered will be entitled to
the benefits specified therein and in the Deposit Agreement.
(x) All of the outstanding shares of Common Stock have been
duly authorized and are validly issued, fully paid and non-assessable
(meaning that no further sums are payable to the Company in respect of
such shares).
(xi) The execution and delivery by the Company of, and the
performance by the Company of its obligations under, this Agreement
will not contravene any provision of applicable law or the certificate
of incorporation or by-laws of the Company or any agreement or other
instrument binding upon the Company or the Subsidiary that is material
to the Company or the Subsidiary, taken as a whole, or any material
judgment, order or decree of any governmental body, agency or court
having
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17
jurisdiction over the Company or the Subsidiary, whether foreign or
domestic, and no consent, approval, authorization or order of, or
qualification with, any governmental body or agency, self-regulatory
organization or court or other tribunal, whether foreign or domestic,
is required for the performance by the Company of its obligations under
this Agreement, except such as may have been obtained and as may be
required by the securities or Blue Sky laws of the various states and
foreign jurisdictions, including without limitation, Japan in
connection with the offer and sale of ADSs by the Sellers pursuant to
the Purchase Contracts.
(xii) There has not occurred any material adverse change, or
any development involving a prospective material adverse change, in the
condition, financial or otherwise, or in the earnings, business or
operations of the Company and the Subsidiary, taken as a whole, from
that set forth in the Company Prospectus (exclusive of any amendments
or supplements thereto subsequent to the date of this Agreement).
(xiii) There are no legal or governmental proceedings pending
or threatened to which the Company or the Subsidiary is a party or to
which any of the properties of the Company or the Subsidiaries is
subject that are required to be described in the Company Registration
Statement or the Company Prospectus and are not so described or any
contracts or other documents that are required to be described in the
Company Registration Statement or the Company Prospectus or to be filed
as exhibits to the Company Registration Statement that are not
described or filed as required.
(xiv) Each preliminary prospectus filed as part of the Company
Registration Statement as originally filed or as part of any amendment
thereto, or filed pursuant to Rule 424 under the Securities Act,
complied when so filed in all material respects with the Securities
Act.
(xv) The Company is not an "investment company" or an entity
"controlled" by an "investment company" as such terms are defined in
the Investment Company Act.
(xvi) No stamp or other issuance or transfer taxes or duties
are payable by or on behalf of the Trust or the Underwriters in
connection with (A) the sale of the ADSs to the Trust pursuant to the
Purchase Contracts, (B) the issuance of the PEPS Shares or the sale
thereof
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to the Underwriters in the manner contemplated herein and in the Trust
Prospectus; or (C) the resale and delivery of the PEPS Shares by the
Underwriters in the manner contemplated in the Trust Prospectus.
(xvii) For the purposes described in Section 12 hereof, under
the laws of the State of New York relating to submission to
jurisdiction, the Company has validly and irrevocably submitted to the
jurisdiction of any State or Federal court located in the Borough of
Manhattan, The City of New York, New York, has validly and irrevocably
waived any objection to the venue of a proceeding in any such court,
and has validly and irrevocably appointed CT Corporation System as its
authorized agent for service of process.
(xviii) There are no contracts, agreements or understandings
between the Company and any person granting such person the right to
require the Company to file a registration statement under the
Securities Act with respect to any securities of the Company held by
such person or to require the Company to include such securities with
the shares of Common Stock registered pursuant to the Company
Registration Statement or the ADSs evidenced by ADRs registered
pursuant to the ADS Registration Statement.
(xix) The accountants who certified the financial statements
and supporting schedules included in the Company Registration Statement
are independent public accountants as required by the Securities Act.
(xx) The Company has complied with all provisions of Section
517.075, Florida Statutes relating to doing business with the
Government of Cuba or with any person or affiliate located in Cuba.
(e) Amway Corporation, a Delaware corporation ("Amway"),
represents and warrants to and agrees with each of the Underwriters, the
Company, the Trust and the Sellers that:
(i) (A) Each part of the Trust Registration Statement, when
such part became effective, did not contain and each such part, as
amended or supplemented, if applicable, will not contain any 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, (B) the Trust Registration Statement and the Trust
Prospectus comply and, as amended or supplemented, if applicable, will
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19
comply in all material respects with the Securities Act and the
applicable rules and regulations of the Commission thereunder and (C)
the Trust Prospectus does snot contain and, as amended or supplemented,
if applicable, will not contain any untrue statement of a material fact
or omit to state a material fact necessary to make the statements
therein, in the light of the circumstances under which they were made,
not misleading, except that the representations and warranties set
forth in this Section 1(e)(i) do not apply to statements or omissions
in the Trust Registration Statement or the Trust Prospectus based upon
information furnished in writing by such Underwriter through you
expressly for use therein.
(ii) Each preliminary prospectus filed as part of the Company
Registration Statement as originally filed or as part of any amendment
thereto, or filed pursuant to Rule 424 under the Securities Act,
complied when so filed in all material respects with the Securities
Act.
2. AGREEMENTS TO SELL AND PURCHASE. The Trust hereby agrees to
sell to the several Underwriters, and each Underwriter, upon the basis of the
representations and warranties herein contained, but subject to the conditions
hereinafter stated, agrees, severally and not jointly, to purchase from the
Trust the respective number of Firm PEPS Shares set forth in Schedules I and II
hereto opposite their names at $______ a share (the "Purchase Price").
On the basis of the representations and warranties contained
in this Agreement, and subject to its terms and conditions, the Trust agrees to
sell to the U.S. Underwriters the Additional PEPS Shares, and the U.S.
Underwriters shall have a one-time right to purchase, severally and not jointly,
up to ______ Additional PEPS Shares at the Purchase Price. If you, on behalf of
the U.S. Underwriters, elect to exercise such option, you shall so notify the
Trust in writing not later than 30 days after the date of this Agreement, which
notice shall specify the number of Additional PEPS Shares to be purchased by the
U.S. Underwriters and the date on which such shares are to be purchased. Such
date may be the same as the Closing Date (as defined below) but not earlier than
the Closing Date nor later than ten business days after the date of such notice.
Additional PEPS Shares may be purchased as provided in Section 4 hereof solely
for the purpose of covering over-allotments made in connection with the offering
of the Firm PEPS Shares. If any Additional PEPS Shares are to be purchased, each
U.S. Underwriter agrees, severally and not
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jointly, to purchase the number of Additional PEPS Shares (subject to such
adjustments to eliminate fractional shares as you may determine) that bears the
same proportion to the total number of Additional PEPS Shares to be purchased as
the number of U.S. Firm PEPS Shares set forth in Schedule I hereto opposite the
name of such U.S. Underwriter bears to the total number of U.S. Firm PEPS
Shares. The Additional PEPS Shares to be purchased by the U.S. Underwriters
hereunder and the U.S. Firm PEPS Shares are hereinafter collectively referred to
as the "U.S. PEPS Shares."
The Company and each member of the HDV Group and the JVA
Group, severally and not jointly, hereby agree that, without the prior written
consent of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated on behalf of the Underwriters, it
will not, during the period ending 90 days after the date of the Company
Prospectus, (i) offer, pledge, sell, contract to sell, sell any option or
contract to purchase, purchase any option or contract to sell, sell any option
or contract to purchase, purchase any option or contract to sell, grant any
option, right or warrant to purchase, or otherwise transfer or dispose of,
directly or indirectly, any ADSs or shares of Common Stock or any securities
convertible into or exercisable or exchangeable for ADSs or shares of Common
Stock (whether such ADSs or shares of Common Stock or any such securities are
now owned or are hereafter acquired), or (ii) enter into any swap or other
agreement that transfers, in whole or in part, any of the economic consequences
of ownership of the ADSs or shares of Common Stock, whether any such transaction
described in clause (i) or (ii) above is to be settled by delivery of ADSs,
shares of Common Stock or such other securities, in cash or otherwise. The
foregoing sentence shall not apply to transfers of ADSs or shares of Common
Stock or securities convertible into or exercisable or exchangeable for ADSs or
Common Stock pursuant to (x) certain permitted private sale transactions among
members of the ▇▇▇▇▇ and ▇▇▇ ▇▇▇▇▇ Families (as defined below) or any entity
directly or indirectly controlled by members of the ▇▇▇ ▇▇▇▇▇ or ▇▇▇▇▇ Families
or entities directly or indirectly controlled by any of them (collectively, the
"Affiliated Entities") in which the transferee agrees in writing to be bound by
the provisions of this paragraph to the same extent as the transferor is bound,
(y) existing or prospective employee stock option plans previously disclosed to
the Underwriters and (z) a bona fide gift or gifts among members of the ▇▇▇▇▇
and ▇▇▇ ▇▇▇▇▇ Families or the Affiliated Entities or to a charitable or
educational organization which is a tax-exempt organization under Section
501(c)(3) of the Internal Revenue Code of 1986, as amended if the donee agrees
in writing to be bound by the provisions of this paragraph to the same extent as
the donor
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is bound. For the purposes of this paragraph "▇▇▇ ▇▇▇▇▇ and ▇▇▇▇▇ Families"
shall mean ▇▇▇ ▇▇▇ ▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ and any and all of their spouses,
parents, brothers, sisters, brothers-in-law, sisters-in-law, children and
grandchildren (whether natural or adopted), daughters-in- law, sons-in-law and
blood relatives not more remote than first cousin.
3. TERMS OF PUBLIC OFFERING. The Trust, the Sellers and the
Company are advised by you that the Underwriters propose to make a public
offering of their respective portions of the PEPS Shares as soon after the
Registration Statements and this Agreement have become effective as in your
judgment is advisable. The Trust, the Sellers and the Company are further
advised by you that the PEPS Shares are to be offered to the public initially at
$______ per share (the "Public Offering Price") and to certain dealers selected
by you at a price that represents a concession not in excess of $______ per
share under the Public Offering Price, and that any Underwriter may allow, and
such dealers may reallow, a concession, not in excess of $_____ per share, to
any Underwriter or to certain other dealers.
Each U.S. Underwriter hereby makes to and with the Trust, the
Company and the Sellers the representations and agreements of such U.S.
Underwriter contained in the fifth and sixth paragraphs of Article III of the
Agreement Between U.S. and International Underwriters of even date herewith.
Each International Underwriter hereby makes to and with the Trust, the Company
and the Sellers the representations and agreements of such International
Underwriter contained in the seventh, eight, ninth and tenth paragraphs of
Article III of such Agreement.
4. PAYMENT AND DELIVERY. Payment for the Firm PEPS Shares
shall be made by certified or official bank check or checks payable to the order
of the Trust in New York Clearing House funds in U.S. dollars at the office of
▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ at 10:00 A.M.,
local time, on ____________, 1995, or at such other time on the same or such
other date, not later than _________, 1995, as shall be designated in writing by
you. The time and date of such payment are hereinafter referred to as the
"Closing Date."
Payment for any Additional PEPS Shares shall be made by
certified or official bank check or checks payable to the order of the Trust in
New York Clearing House funds in U.S. dollars at the offices of ▇▇▇▇▇ ▇▇▇▇ &
▇▇▇▇▇▇▇▇, 450
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▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ at 10:00 A.M., local time, on the date
specified in the notice described in Section 2 or on such other date, in any
event not later than _______, 1995, as shall be designated in writing by you.
The time and date of such payment are hereinafter referred to as the "Option
Closing Date."
Certificates for the Firm PEPS Shares and Additional PEPS
Shares shall be in definitive form and registered in such names and in such
denominations as you shall request in writing not later than two full business
days prior to the Closing Date or the Option Closing Date, as the case may be.
The certificates evidencing the Firm PEPS Shares and Additional PEPS Shares
shall be delivered to you on the Closing Date or the Option Closing Date, as the
case may be, for the respective accounts of the several Underwriters, with any
transfer taxes payable in connection with the transfer of the PEPS Shares to the
Underwriters duly paid, against payment of the Purchase Price therefor.
5. CONDITIONS TO THE UNDERWRITERS' OBLIGATIONS. The
obligations of the Trust to sell the PEPS Shares to the Underwriters and the
several obligations of the Underwriters to purchase and pay for the PEPS Shares
on the Closing Date are subject to the condition that the Registration
Statements shall have become effective not later than 5:00 p.m. (New York time)
on the date hereof.
The several obligations of the Underwriters are subject to the
following further conditions:
(a) Subsequent to the execution and delivery of this Agreement
and prior to the Closing Date there shall not have occurred (i) any
change, or any development involving a prospective change, in the
condition, financial or otherwise, of the Trust, or in the investment
objectives, investment policies, liabilities, business, prospects or
operations of the Trust from that set forth in the Trust Registration
Statement, (ii) any change, or any development involving a prospective
change, in the condition, financial or otherwise, of the Company or in
the earnings, business or operations of the Company and the Subsidiary,
taken as a whole, from that set forth in the Company Registration
Statement, or (iii) any change, or any development involving a
prospective change, in the condition, financial or otherwise, of any
member of the HDV Group or the JVA Group or in the earnings, business
or operations of any member of the HDV Group or the JVA Group, since
the date hereof,
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23
that, in your reasonable judgment, is material and adverse and that
makes it, in your judgment, impracticable to market the PEPS Shares on
the terms and in the manner contemplated in the Trust Prospectus.
(b) The Underwriters shall have received on the Closing Date
certificates, dated the Closing Date and signed by an executive
officer, trustee, agent or other authorized person, as applicable, of
the Trust, the Company and each member of the HDV Group and the JVA
Group, to such individual's knowledge, in each case to the relevant
effect set forth in clause (a) above, and to the effect that the
respective representations and warranties of each of the Trust, the
Company and of each member of the HDV Group and the JVA Group,
severally and not jointly, contained in this Agreement, the relevant
Purchase Contract and the relevant Collateral Agreement are true and
correct on and as of the Closing Date as though made on the Closing
Date and that each of the Trust, the Company and each member of the HDV
Group and the JVA Group, has complied in all material respects with all
of the agreements and satisfied all of the conditions on its part to be
performed or satisfied hereunder or thereunder on or before the Closing
Date.
(c) Each Fundamental Agreement shall have been executed and
delivered by all parties thereto, and each Seller shall have delivered
to the Collateral Agent the number of ADSs required by such Seller's
Collateral Agreement to be initially pledged thereunder in accordance
with the requirements of the Collateral Agreement.
(d) You shall have received on the Closing Date an opinion of
▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇, special counsel for the Trust and the
Underwriters, dated the Closing Date, to the effect that:
(i) each of the Registration Statements is effective
under the Securities Act and, to such counsel's knowledge, no
stop order suspending the effectiveness of the Trust
Registration Statement is in effect and no proceedings for
such purpose are pending or threatened by the Commission;
(ii) at the time the Trust Registration Statement
became effective, the Trust Registration Statement (other than
the operating statistics, financial statements, financial
schedules and other financial and statistical information
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24
included therein, as to which no opinion need be rendered)
complied as to form in all material respects with the
requirements of the Acts; and such counsel does not know of
any material contracts or other documents of a character
required to be described in or filed as exhibits to the Trust
Registration Statement by the Securities Act which have not
been described in or filed as exhibits to the Trust
Registration Statement as required;
(iii) the Trust has been duly created, is validly
existing as a Trust under the laws of the State of New York,
has the power and authority to conduct its business as
described in the Trust Prospectus;
(iv) the Trust is registered with the Commission as a
non-diversified, closed-end management investment company
under the Investment Company Act and, to such counsel's
knowledge, no order of suspension or revocation of such
registration has been issued or proceedings therefor initiated
or threatened by the Commission;
(v) this Agreement has been duly authorized, executed
and delivered by the Trust;
(vi) each Fundamental Agreement has been duly
authorized, executed and delivered by the Trust and, assuming
due authorization, execution and delivery by the other parties
thereto, is a valid and binding agreement of the Trust,
enforceable in accordance with its terms except as (a) the
enforceability thereof may be limited by bankruptcy,
insolvency or similar laws affecting creditors' rights
generally and (b) the availability of equitable remedies may
be limited by equitable principles of general applicability;
(vii) none of (A) the execution and delivery by the
Trust of, and the performance by the Trust of its obligations
under, each Fundamental Agreement, or (B) the issuance and
sale by the Trust of the PEPS Shares as contemplated by this
Agreement, will contravene any provision of applicable U.S. or
State of New York law or of the Trust Agreement or, to such
counsel's knowledge, any agreement or instrument binding upon
the Trust that is material to the Trust, or, to such
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25
counsel's knowledge, any judgment, order or decree of any U.S.
or State of New York governmental body, agency or court having
jurisdiction over the Trust counsel, and no consent, approval,
authorization or order of, or qualification with, any U.S. or
State of New York governmental body or agency, is required for
the performance by the Trust of its obligations under this
Agreement and the Fundamental Agreements, except as may be
required by the Acts, the Exchange Act or the securities or
Blue Sky laws of the various states and in connection with the
offer and sale of the PEPS Shares by the Underwriters;
(viii) the authorized capital stock of the Trust
conforms in all material respects to the description thereof
contained in the Trust Prospectus; and the Trust Agreement and
the Fundamental Agreements conform in all material respects as
to legal matters to the descriptions thereof contained in the
Prospectuses;
(ix) the Trust Agreement and the Fundamental
Agreements comply with all applicable provisions of the Acts,
and all approvals of such documents required under the
Investment Company Act by the Trust's shareholders and the
Trustees have been obtained and are in full force and effect;
(x) to the knowledge of such counsel, the Fundamental
Agreements are in full force and effect and, to such counsel's
knowledge, neither the Trust nor any other party to any such
agreement is in default thereunder and, to the knowledge of
such counsel, no event has occurred which with the passage of
time or the giving of notice or both would constitute a
default thereunder. To the knowledge of such counsel, the
Trust is not currently in breach of, or in default under, any
other written agreement or instrument to which it or its
property is bound or affected;
(xi) the shares of Premium Exchangeable Participating
Shares outstanding prior to issuance of the PEPS Shares have
been duly authorized and are validly issued, fully paid and
non-assessable;
(xii) the PEPS Shares have been duly authorized and,
when issued and delivered in accordance with the terms of this
Agreement, will be validly issued, fully paid and
non-assessable,
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and the issuance of the PEPS Shares will not be
subject to any preemptive or similar rights;
(xiii) the statements in the Trust Prospectus under
"Description of the PEPS" and "Underwriting," and the
statements in the Company Prospectus under "Description of the
American Depositary Receipts," in each case insofar as such
statements constitute summaries of the legal matters,
documents or proceedings referred to therein, fairly present
the information called for with respect to such legal matters,
documents and proceedings and fairly summarize the matters
referred to therein;
(xiv) the statements in the Trust Prospectus under
"Federal Income Tax Considerations," to the extent that they
constitute summaries of the legal matters referred to therein,
fairly represent our opinion as to such matters;
(xv) the descriptions, if any, in the Trust
Prospectus of U.S. or State of New York statutes, regulations
and legal or governmental proceedings are accurate in all
material respects and fairly summarize the matters referred to
therein;
(xvi) after due inquiry, such counsel does not know
of any legal or governmental proceedings pending or threatened
to which the Trust is a party that is required to be described
in the Trust Registration Statement or the Trust Prospectus
and is not so described or of any U.S. or State of New York
statutes or regulations, contracts or other documents that are
required to be described in the Trust Registration Statement
or the Trust Prospectus or to be filed as exhibits to the
Trust Registration Statement that are not described or filed
as required; and
(xvii) such counsel (A) is of the opinion that the
Registration Statements, the Notification and the Prospectuses
(other than the operating statistics, financial statements,
financial schedules and other financial and statistical
information included therein, as to which no opinion need be
rendered) comply as to form in all material respects with the
Acts, (B) has no reason to believe that (other than the
operating statistics, financial statements, financial
schedules and other financial and statistical
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27
information included therein, as to which no opinion need be
rendered) any part of the Registration Statements, when such
part became effective contained, and as of the date hereof
contains, any untrue statement of a material fact or omitted
or omits to state a material fact required to be stated
therein or necessary to make the statements therein not
misleading and (C) has no reason to believe that (other than
the operating statistics, financial statements, financial
schedules and other financial and statistical information
included therein, as to which no opinion need be rendered) the
Prospectuses as of the date hereof contain any untrue
statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not
misleading.
With respect to subparagraph (xvii) of this paragraph (d),
▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇ may state that their opinion and belief are based
upon their participation in the preparation of the Registration
Statements and the Prospectuses and any amendments or supplements
thereto and review and discussion of the contents thereof, but are
without independent check or verification, except as specified.
(e) You shall have received on the Closing Date an opinion of
Nishimura & Sanada, Japanese counsel for the Company and the Sellers,
dated the Closing Date, to the effect that:
(i) the Company is validly existing as a corporation
under the laws of Japan with corporate power and authority to
own, lease and operate its properties and to conduct its
business as described in the Company Prospectus and to enter
into and perform its obligations under this Agreement and the
Deposit Agreement;
(ii) the authorized, issued and outstanding share
capital of the Company is as set forth under the caption
"Description of Capital Stock" in the Company Prospectus and
the issued and outstanding shares of Common Stock have been
duly authorized and validly issued and are fully paid and
non-assessable (meaning that no further sums are payable to
the Company with respect to the holding of such shares);
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(iii) this Agreement, has been duly authorized,
executed and delivered by the Company;
(iv) all outstanding shares of Common Stock,
including the shares of Common Stock underlying the ADSs to be
delivered by the Sellers in pledge pursuant to the Collateral
Agreements, have been duly and validly issued and are fully
paid and non-assessable (meaning that no further sums are
payable to the Company on such shares); and the terms and
provisions of such shares of Common Stock and other share
capital of the Company conform in all material respects to the
descriptions thereof contained in the Company Prospectus;
(v) no filing with, or consent, approval,
authorization, order, registration, qualification or decree
of, any court or governmental authority or body in Japan is
necessary or required to be obtained by the Company or either
Seller in connection with its obligations hereunder, the offer
or sale of ADSs pursuant to the Purchase Contracts, or the
performance of the transactions contemplated by this
Agreement, the Purchase Contracts or the Collateral
Agreements, except such as have been duly filed or obtained in
accordance with Japanese law;
(vi) the form of certificates used to evidence shares
of the Company Common Stock are in due and proper form and
complies with all applicable statutory requirements of Japan;
(vii) the Company has the power to submit, and
pursuant to this Agreement has legally, validly, effectively
and irrevocably submitted, to the jurisdiction of any federal
or state court in the State of New York, County of New York,
and has the power to designate, appoint and empower and
pursuant to this Agreement has legally, validly, effectively
and irrevocably designated, appointed and empowered an agent
for service of process in any suit or proceeding based on or
arising under this Agreement in any federal or state court in
the State of New York, County of New York as provided in
Section 12 hereof;
(viii) no stamp or other issuance or transfer taxes
or duties and no capital gains, income, withholding or other
taxes are payable to the
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Republic of Japan or any political subdivision or taxing
authority thereof or therein by or on behalf of the Trust or
the Underwriters in connection with (A) the sale of the ADSs
to the Trust pursuant to the Contracts, (B) the issuance of
the PEPS Shares or the sale thereof to the Underwriters in the
manner contemplated herein; or (C) the resale and delivery of
the PEPS Shares by the Underwriters in the manner contemplated
in the Trust Prospectus;
(ix) the statements under the captions "Prospectus
Summary", "Risk Factors", "Dividends and Dividend Policy",
"Management's Discussion and Analysis of Financial Conditions
and Results of Operations", "Business - Government
Regulation", "Description of Capital Stock", "Exchange
Controls and Other Limitations Affecting Securityholders" and
"Taxation - Japanese Taxation" in the Company Registration
Statement and the Company Prospectus, to the extent that they
constitute a description of the laws and regulations of Japan,
or their respective agencies, authorities or other
governmental or quasi-governmental bodies, or documents, or
proceedings or conclusions of Japanese law, are correct in all
material respects;
(x) the statements under the caption "Taxation --
Japanese Taxation" in the Company Registration Statement and
the Company Prospectus describe the material anticipated tax
consequences of an investment in the Common Stock or ADSs
under Japanese tax laws;
(xi) the Company and its obligations under this
Agreement and the Deposit Agreement are subject to civil and
commercial law and to suit in Japan and neither it or any of
its properties, assets or revenues has any right of immunity,
on any grounds, from any legal action, suit or proceeding,
from the giving of any relief in any such legal action, suit
or proceeding, from setoff or counterclaim, from the
jurisdiction of any court, from service of process, attachment
upon or prior to judgment, or attachment in aid of execution
of judgment, or from execution of a judgment, or other legal
process or proceeding for the giving of any relief or for the
enforcement of judgment, in Japan, with respect to its
obligations, liabilities or any other matter under
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or arising out of or in connection with this Agreement and the
Deposit Agreement, and to the extent that the Company or its
properties, assets or revenues may have or may hereafter
become entitled to any such right of immunity in Japan in
which proceedings may at any time be commenced, the Company
has effectively waived or agreed to waive such right to the
extent permitted by law and consented to such relief and
enforcement as provided in Section 12 of this Agreement;
(xii) It is not necessary to ensure the legality,
validity, enforceability or admissibility in evidence of this
Agreement or the Deposit Agreement in Japan or any political
subdivision thereof that any of them be filed or recorded or
enrolled with any court or authority in Japan or any political
subdivision thereof or that any stamp, registration or similar
tax be paid in Japan or any political subdivision thereof
except for any ad valorem court or other expenses payable in
connection with any action, litigation, petition or other
court proceeding brought before the Courts of Japan for or in
respect of the enforcement thereof;
(xiii) to the knowledge of such counsel, (A) the
Company is not in violation of its Articles of Association,
board of directors' regulations or share handling regulations
or in default in the performance or observance of any
obligation, agreement, covenant or condition contained in any
contract, indenture, mortgage, loan agreement, note, license,
lease or other instrument or agreement to which the Company is
a party or by which it may be bound, or to which any of the
property or assets of the Company is subject, which violation
or default would be reasonably expected to have a material
adverse affect on the condition, financial or otherwise, or
the earnings, business affairs or business prospects of the
Company and the Subsidiary considered as one enterprise; and
(B) the execution, delivery and performance of this Agreement
and the Deposit Agreement and the consummation of the
transactions contemplated herein, therein and thereby have
been duly authorized by the Company and will not conflict with
or constitute a breach of, or default under, or result in the
creation or imposition of any tax, lien, charge or encumbrance
upon any revenues, property or assets of the
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Company pursuant to, any treaty, law, regulation or decree or
any contract, indenture, mortgage, loan agreement, note,
license, lease or other instrument or agreement to which the
Company is a party or by which it may be bound, or to which
any of the property or assets of the Company is subject (other
than any such breach, default, creation or imposition, as,
when taken together with all such breaches, defaults,
creations and impositions, would not be reasonably expected to
have a material adverse effect on the condition, financial or
otherwise, or the earnings, business affairs or business
prospects of the Company and the Subsidiary considered as one
enterprise), nor will such action result in any violation of
the provisions of the Articles of Association or board of
directors' regulations or share handling regulations of the
Company or any Japanese treaty, law, rule, administrative
regulation, judgment, order of any governmental agency or
body, administrative or court decree in Japan or regulations
or guidances of the Japanese Securities Dealers Association
("JSDA") (other than any such violation as, when taken
together with all such violations, would not have a material
adverse effect on the condition, financial or otherwise, or
the earnings, business affairs or business prospects of the
Company and the Subsidiary considered as one enterprise);
(xiv) the Deposit Agreement is in full force and
effect and, to such counsel's knowledge, neither the Company
nor any other party to such agreement is in default thereunder
and, to such counsel's knowledge, no event has occurred which
with the passage of time or the giving of notice or both would
constitute a default thereunder;
(xv) to the best knowledge of such counsel, the
Company owns, possesses or has the right to use patents,
patent rights, licenses, invention, copyrights, know-how
(including trade secrets and other unpatented and/or
unpatentable proprietary or confidential information, systems
or procedures), trademarks, service marks and trade names
presently employed by it in connection with the business now
operated by it, and the Company has not received and notice of
infringement of or conflict with asserted rights of others
with respect to any of the foregoing with, singly or in the
aggregate, would be reasonably expected to
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result in any material adverse change in the condition,
financial or otherwise, or in the earnings, business affairs
or business prospects of the Company and the Subsidiary
considered as one enterprise; and
(xvi) such counsel (A) has no reason to believe that
(other than the operating statistics, financial statements,
financial schedules and other financial and statistical
information included therein, as to which no opinion need be
rendered) any part of the Company Registration Statement, when
such part became effective contained, and as of the date
hereof contains, any untrue statement of a material fact or
omitted or omits to state a material fact required to be
stated therein or necessary to make the statements therein not
misleading and (B) has no reason to believe that (other than
the operating statistics, financial statements, financial
schedules and other financial and statistical information
included therein, as to which no opinion need be rendered) the
Company Prospectus as of the date hereof contains any untrue
statement of a material fact or omits to state a material fact
necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not
misleading.
With respect to subparagraph (xvi) of this paragraph (e),
Nishimura & Sanada may state that their opinion and belief are based
upon their participation in the preparation of the Company Registration
Statement, the ADS Registration Statement and the Company Prospectus
and any amendments or supplements thereto and review and discussion of
the contents thereof, but are without independent check or
verification, except as specified.
(f) You shall have received on the Closing Date an opinion of
▇▇▇▇▇, Day, ▇▇▇▇▇▇ & ▇▇▇▇▇, special U.S. counsel for the Company and
the Sellers, dated the Closing Date, to the effect that:
(i) each of the Registration Statements and the ADS
Registration Statement is effective under the Securities Act
and, to the their knowledge, no stop order suspending the
effectiveness of the Registration Statements or the ADS
Registration Statement has been issued under the Securities
Act
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and no proceedings for that purpose are pending or
threatened by the Commission;
(ii) at the time the Registration Statements became
effective, the Registration Statements (other than the
operating statistics, financial statements, financial
schedules and other financial and statistical information
included therein, as to which no opinion need be rendered)
complied as to form in all material respects with the
requirements of the Acts; and such counsel does not know of
any material contracts or other documents of a character
required to be described in or filed as exhibits to the
Registration Statements by the Securities Act which have not
been described in or filed as exhibits to the Registration
Statements as required;
(iii) no filing with, or consent, approval,
authorization, order, registration, qualification or decree
of, any court or governmental authority or body of the United
States or the State of New York is necessary in connection
with the consummation on the part of the Company or the
Sellers of the transactions contemplated by this Agreement,
except such as may be required under the Securities Act or the
securities or Blue Sky laws of the various states and in
connection with the offer and sale of the PEPS Shares by the
Underwriters;
(iv) to the knowledge of such counsel, under the laws
of the State of New York relating to submission to
jurisdiction and pursuant to this Agreement, the Company has
validly and irrevocably submitted to the personal jurisdiction
of any federal or state court in the State of New York, County
of New York in any suit or proceeding based on or arising
under this Agreement as provided in Section 12 hereof; and, to
the knowledge of such counsel, the Company has the power to
designate, appoint and empower and pursuant to this Agreement
has validly and irrevocably designated, appointed and
empowered an agent for service of process in any suit or
proceeding based on or arising under this Agreement in any
federal or state court in the State of New York, County of New
York as provided in Section 12 hereof;
(v) the execution, delivery and performance by the
Company of this Agreement and the
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34
consummation on the part of the Company of the transactions
contemplated herein, to such counsel's knowledge, will not
conflict with or constitute a breach of, or a default under,
or result in the creation or imposition of any tax, lien,
charge or encumbrance upon any revenues, property or assets of
the Company or of the Subsidiary pursuant to any of the terms
herein or pursuant to any U.S. federal treaty, or any U.S.
federal or New York law, regulation or decree (other than any
such breach, default, creation or imposition as, when taken
together with all such breaches, defaults, creations and
impositions, would not have a material adverse effect on the
condition, financial or otherwise, or the earnings, business
affairs or business prospects of the Company and the
Subsidiary considered as one enterprise);
(vi) The execution, delivery and performance by the
Company of this Agreement and the consummation on the part of
the Company of the transactions contemplated herein will not
conflict with or result in a default under any of the
provisions of any indenture, loan agreement or other agreement
known to us by which the Company is bound, in each case which
conflict or default would be reasonably expected to have a
material adverse effect on the condition, financial or
otherwise, or the earnings, business affairs or business
prospects of the Company and the Subsidiary considered as one
enterprise;
(vii) such counsel does not know of any litigation or
governmental proceedings, pending or threatened, required to
be described in the Trust Prospectus that are not described as
required;
(viii) the Company is not an "investment company" or
an entity "controlled" by an "investment company," as such
terms are defined in the Investment Company Act;
(ix) the Deposit Agreement is in full force and
effect and, to such counsel's knowledge, neither the Company
nor any other party to such agreement is in default thereunder
and, to such counsel's knowledge, no event has occurred which
with the passage of time or the giving of notice or both would
constitute a default thereunder;
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35
(x) the ADRs are in due and proper form and comply
with the applicable statutory requirements of U.S. and state
law and conform in all material respects as to legal matters
to the description thereof contained in the Trust Prospectus;
(xi) the statements in the Company Prospectus under
"Description of the American Depositary Receipts" and "Plan of
Distribution", insofar as such statements constitute a summary
of the law or legal conclusions, documents or proceedings
referred to therein, are accurate in all material respects and
fairly present the information called for with respect to such
legal matters, legal conclusions, documents and proceedings
and fairly summarize the matters referred to therein;
(xii) To the knowledge of such counsel, the
Subsidiary is not in violation of its Certificate of
Incorporation or by-laws or in default in the performance or
observance of any obligation, agreement, covenant or condition
contained in any contract, indenture, mortgage, loan
agreement, note, license, lease or other instrument or
agreement to which the Subsidiary is a party or by which it
may be bound, or to which any of the property or assets of the
Subsidiary is subject, which violation or default would be
reasonably expected to have a material adverse affect on the
condition, financial or otherwise, or the earnings, business
affairs or business prospects of the Company and the
Subsidiary considered as one enterprise; and the execution,
delivery and performance of this Agreement, and the Deposit
Agreement and the consummation of the transactions
contemplated herein, therein and thereby will not conflict
with or constitute a breach of, or default under, or result in
the creation or imposition of any tax, lien, charge or
encumbrance upon any revenues, property or assets of the
Subsidiary pursuant to, any treaty, law, regulation or decree
or any contract, indenture, mortgage, loan agreement, note,
license, lease or other instrument or agreement to which the
Subsidiary is a party or by which it may be bound, or to which
any of the property or assets of the Subsidiary is subject
(other than any such breach, default, creation or imposition,
as, when taken together with all such breaches, defaults,
creations and impositions, would not be reasonably expected to
have a material adverse effect on the
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36
condition, financial or otherwise, or the earnings, business
affairs or business prospects of the Company and the
Subsidiary considered as one enterprise), nor will such action
result in any violation of the provisions of the Certificate
of Incorporation or by-laws of the Subsidiary or any U.S.
federal treaty, or any U.S., New York or Delaware corporate
law, rule, administrative regulation, judgment, order of any
governmental agency or body or administrative or court decree
in Japan (other than any such violation as, when taken
together with all such violations, would not have a material
adverse effect on the condition, financial or otherwise, or
the earnings, business affairs or business prospects of the
Company and the Subsidiary considered as one enterprise);
(xiii) upon the occurrence of an Event of Default
specified in Section [__] of the Collateral Agreements, the
rights of the Collateral Agent with respect to the Collateral,
as set forth in the Collateral Agreements, shall immediately
become exercisable in accordance with the terms of the
Collateral Agreements, and such rights will not be subject to
any stay pursuant to Section 362(a) of the Bankruptcy Code;
(xiv) the Subsidiary has been duly incorporated, is
validly existing as a corporation in good standing under the
laws of the State of Delaware, has the corporate power and
authority to own its property and to conduct its business as
described in the Company Prospectus and is duly qualified to
transact business and is in good standing in each jurisdiction
in which the conduct of its business or its ownership or
leasing of property requires such qualification, except to the
extent that the failure to be so qualified or be in good
standing would not have a material adverse effect on the
Company and the Subsidiary, considered as one enterprise; and
(xv) such counsel (A) is of the opinion that the
Registration Statements, the ADS Registration Statement and
the Prospectuses (other than the operating statistics,
financial statements, financial schedules and other financial
and statistical information included therein, as to which no
opinion need be rendered) comply as to form in all material
respects with the requirements of the Securities Act, (B) has
no
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37
reason to believe that (other than the operating statistics,
financial statements, financial schedules and other financial
and statistical information included therein, as to which no
opinion need be rendered) any part of the Registration
Statements or the ADS Registration Statement, when such part
became effective contained, and as of the date hereof
contains, any untrue statement of a material fact or omitted
or omits to state a material fact required to be stated
therein or necessary to make the statements therein not
misleading and (C) has no reason to believe that (other than
the operating statistics, financial statements, financial
schedules and other financial and statistical information
included therein, as to which no opinion need be rendered) the
Prospectuses as of the date hereof contains any untrue
statement of a material fact or omits to state a material fact
necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not
misleading.
With respect to subparagraph (xv) of this paragraph (f),
▇▇▇▇▇, Day, ▇▇▇▇▇▇ & ▇▇▇▇▇ may state that their opinion and belief are
based upon their participation in the preparation of the Registration
Statements, the ADS Registration Statement, and the Prospectuses and
any amendments or supplements thereto and review and discussion of the
contents thereof, but are without independent check or verification,
except as specified.
(g) You shall have received on the Closing Date an opinion of
Cravath, Swaine & ▇▇▇▇▇, special counsel for the HDV Group, dated the
Closing Date, to effect that:
(i) HDV, Inc. has been duly incorporated, is validly
existing as a corporation in good standing under the laws of
the jurisdiction of the State of Michigan, has the power and
authority to own its property and to conduct its business and
is duly qualified to transact business and is in good standing
in each jurisdiction in which the conduct of its business or
its ownership or leasing of property requires such
qualification, except to the extent that the failure to be so
qualified or be in good
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38
standing would not have a material adverse
effect on HDV, Inc.;
(ii) HDV Trust has been duly created, is validly
existing as a trust under the laws of the State of
____________, has the power and authority to own its property
and to conduct its business and is duly qualified to transact
business in each jurisdiction in which the conduct of its
business or its ownership or leasing of property requires such
qualification, except to the extent that the failure to be so
qualified or be in good standing would not have a material
adverse effect on HDV Trust;
(iii) this Agreement has been duly authorized,
executed and delivered by or on behalf of the HDV Group;
(iv) the HDV Purchase Contract, the Collateral
Agreement of the HDV Group and the Reimbursement Agreement
have been duly authorized, executed and delivered by or on
behalf of HDV Group and are valid and binding agreements of
the HDV Group enforceable against the HDV Group in accordance
with their respective terms except as (a) such enforceability
may be limited by bankruptcy, insolvency or similar laws
affecting creditors' rights generally and (b) the availability
of equitable remedies may be limited by equitable principles
of general applicability;
(v) the execution and delivery by the HDV Group of,
and the performance by the HDV Group of its obligations under,
this Agreement, the HDV Purchase Contract and the Collateral
Agreement of the HDV Group will not contravene any provision
of applicable law or the certificate of incorporation or
by-laws of HDV, Inc. or the applicable constitutive documents
of HDV Trust, or, to such counsel's knowledge, any agreement
or other instrument binding upon the HDV Group or, to such
counsel's knowledge, any judgment, order or decree of any
governmental body, agency or court having jurisdiction over
the HDV Group, and no consent, approval, authorization or
order of, or qualification with, any governmental body or
agency is required for the performance by the HDV Group of its
obligations under this Agreement, the HDV Purchase Contract of
such Seller, the
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Collateral Agreement of the HDV Group or the
Reimbursement Agreement;
(vi) delivery of the ADSs to be sold by HDV, Inc.
pursuant to this Agreement and the HDV Purchase Contract on
the Exchange Date will pass title to such ADSs free and clear
of any security interests, claims, liens, equities and other
encumbrances, except for those created pursuant to the
Collateral Agreement of the HDV Group;
(vii) HDV, Inc. has good and valid title to the ADSs
pledged and assigned by it pursuant to the Collateral
Agreement of HDV the Group free and clear of any security
interests, claims, liens, equities and other encumbrances. The
ADSs pledged by HDV, Inc. as of the date hereof have been duly
and validly assigned, delivered and pledged by HDV, Inc. under
the Collateral Agreement of the HDV Group and such Collateral
Agreement, together with such assignment, delivery and pledge,
creates, as security for the performance of the obligations of
HDV Group under the HDV Purchase Contract, a valid first and
perfected security interest in such ADSs prior to other liens;
(viii) to the knowledge of the HDV Group, under the
laws of the State of New York relating to submission to
jurisdiction and pursuant to this Agreement, the HDV Group has
validly and irrevocably submitted to the personal jurisdiction
of any federal or state court in the State of New York, County
of New York in any suit or proceeding based on or arising
under this Agreement as provided in Section 12 hereof; and, to
the knowledge of such counsel, the HDV Group has the power to
designate, appoint and empower and pursuant to this Agreement
has validly and irrevocably designated, appointed and
empowered an agent for service of process in any suit or
proceeding based on or arising under this Agreement in any
federal or state court in the State of New York, County of New
York as provided in Section 12 hereof.
(h) You shall have received on the Closing Date an opinion of
▇▇▇▇▇ & ▇▇▇▇▇▇▇, special counsel for the JVA Group, dated the Closing
Date, to effect that:
(i) JVA Trust has been duly created, is validly
existing as a trust under the laws of
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40
the State of ________, has the power and authority to own its
property and to conduct its business and is duly qualified to
transact business in each jurisdiction in which the conduct of
its business or its ownership or leasing of property requires
such qualification, except to the extent that the failure to
be so qualified or be in good standing would not have a
material adverse effect on the JVA Trust;
(ii) this Agreement has been duly authorized,
executed and delivered by or on behalf of the JVA Group;
(iii) the JVA Purchase Contract, the Collateral
Agreement of the JVA Group and the Reimbursement Agreement
have been duly authorized, executed and delivered by or on
behalf of the JVA Group and are valid and binding agreements
of the JVA Group enforceable against the JVA Group in
accordance with their respective terms except as (a) such
enforceability may be limited by bankruptcy, insolvency or
similar laws affecting creditors' rights generally and (b) the
availability of equitable remedies may be limited by equitable
principles of general applicability;
(iv) the execution and delivery by the JVA Group of,
and the performance by the JVA Group of its obligations under,
this Agreement, the Purchase Contract, the Collateral
Agreement of the JVA Group and the Reimbursement Agreement
will not contravene any provision of applicable law or the
applicable constitutive documents of JVA Trust, or, to such
counsel's knowledge, any agreement or other instrument binding
upon the JVA Group or, to such counsel's knowledge, any
judgment, order or decree of any governmental body, agency or
court having jurisdiction over the JVA Group, and no consent,
approval, authorization or order of, or qualification with,
any governmental body or agency is required for the
performance by the JVA Group of its obligations under this
Agreement, the JVA Purchase Contract, the Collateral Agreement
of the JVA Agreement or the Reimbursement Agreement;
(v) delivery of the ADSs to be sold by JVA Trust
pursuant to this Agreement and the JVA Purchase Contract on
the Exchange Date will pass title to such ADSs free and clear
of any security
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interests, claims, liens, equities and other encumbrances,
except for those created pursuant to the Collateral Agreement
of the JVA Group;
(vi) JVA Trust has good and valid title to the ADSs
pledged and assigned by it pursuant to the Collateral
Agreement of the JVA Group free and clear of any security
interests, claims, liens, equities and other encumbrances. The
ADSs pledged by JVA Trust as of the date hereof has been duly
and validly assigned, delivered and pledged by JVA Trust under
the Collateral Agreement of the JVA Group and such Collateral
Agreement, together with such assignment, delivery and pledge,
creates, as security for the performance of the obligations of
the JVA Group under the JVA Purchase Contract, a valid first
and perfected security interest in such ADSs prior to other
liens;
(vii) to the knowledge of such counsel, under the
laws of the State of New York relating to submission to
jurisdiction and pursuant to this Agreement, the JVA Group has
validly and irrevocably submitted to the personal jurisdiction
of any federal or state court in the State of New York, County
of New York in any suit or proceeding based on or arising
under this Agreement as provided in Section 12 hereof; and, to
the knowledge of such counsel, the JVA Group has the power to
designate, appoint and empower and pursuant to this Agreement
has validly and irrevocably designated, appointed and
empowered an agent for service of process in any suit or
proceeding based on or arising under this Agreement in any
federal or state court in the State of New York, County of New
York as provided in Section 12 hereof;
(i) You shall have received on the Closing Date the opinion of
White & Case, special U.S. tax counsel to the Company, to the effect
that the statements in the Company Prospectus under "Taxation - United
States Federal Income Taxation", to the extent that they constitute a
description of the tax laws and regulations of the United States, or
its agencies, authorities or other governmental or quasi-governmental
bodies, or documents or proceedings or conclusions of United States
law, are correct in all material respects.
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(j) You shall have received on the Closing Date the opinion of
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇, U.S. counsel for the Depositary, dated the
Closing Date, to the effect that:
(i) the Deposit Agreement was duly authorized, executed and
delivered by the Depositary and is currently a valid and legally
binding obligation of the Depositary enforceable against it in
accordance with its terms, except insofar as enforceability may be
limited by (a) applicable bankruptcy, insolvency, moratorium or other
laws relating to creditors' rights generally and (b) general principles
of equity (whether considered in an action at law or in equity); and
(ii) when ADRs evidencing ADSs are issued in accordance with
the Deposit Agreement against the deposit, pursuant to the terms of the
Deposit Agreement, of duly authorized, validly issued, fully paid and
nonassessable shares of Common Stock, the preemptive rights, if any,
with respect to which have been validly waived or exercised, such ADRs
will be validly issued and will entitle the holders thereof to the
rights specified therein and in the Deposit Agreement.
With respect to paragraphs (d) and (f) above, ▇▇▇▇▇ ▇▇▇▇ &
▇▇▇▇▇▇▇▇ and ▇▇▇▇▇, Day, ▇▇▇▇▇▇ & ▇▇▇▇▇ may rely upon the opinion of
Nishimura & Sanada set forth in paragraph (e) as to matters of Japanese
law. With respect to paragraph (e) above, Nishimura & Sanada may rely
upon the opinion of ▇▇▇▇▇, Day, ▇▇▇▇▇▇ & ▇▇▇▇▇ set forth in paragraph
(f) as to matters of U.S. law.
The opinion of ▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇ described in paragraph
(d) above shall be rendered to the Underwriters at the request of the
Trust and shall so state therein. The opinions of Nishimura & Sanada,
Jones, Day, ▇▇▇▇▇▇ & ▇▇▇▇▇, White & Case and ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇
described in paragraphs (e), (f), (i) and (j) above, respectively,
shall be rendered to the Underwriters at the request of the Company,
the Sellers and the Company, respectively, and shall so state therein.
The opinions of Cravath, Swaine & ▇▇▇▇▇ and ▇▇▇▇▇ & ▇▇▇▇▇▇▇ described
in paragraphs (g) and (h) above, shall be rendered to the Underwriters
at the request of the respective Sellers and shall so state therein.
(k) The Underwriters shall have received, on each of the date
hereof and the Closing Date, a letter dated
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the date hereof or the Closing Date, as the case may be, in form and
substance satisfactory to the Underwriters, from Deloitte & Touche LLP,
independent public accountants for the Trust, 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 in the Trust Registration
Statement and the Trust Prospectus; provided that the letter delivered
on the Closing Date shall use a "cut-off date" not earlier than the
date hereof.
(l) The Underwriters shall have received, on each of the date
hereof and the Closing Date, a letter dated the date hereof or the
Closing Date, as the case may be, in form and substance satisfactory to
the Underwriters, from Deloitte Touche Tohmatsu, independent public
accountants for the Company, 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 in the Company Registration Statement
and the Company Prospectus; provided that the letter delivered on the
Closing Date shall use a "cut-off date" not earlier than the date
hereof.
(m) The Depositary shall have furnished to the Underwriters a
certificate, satisfactory to the U.S. Representatives, of one of its
authorized officers with respect to the deposit with its custodian of
the shares of Common Stock underlying the ADSs to be pledged pursuant
to the Collateral Agreements, the execution and delivery of the ADRs
evidencing such ADSs pursuant to the Deposit Agreement and such other
matters related thereto as the Underwriters reasonably request.
(n) The "lock-up" agreements, each substantially in the form
of Exhibit A hereto, between you and certain shareholders, officers and
directors of the Company relating to sales and certain other
dispositions of shares of Common Stock, ADSs or certain other
securities, delivered to you on or before the date hereof, shall be in
full force and effect on the Closing Date.
The several obligations of the Underwriters to purchase
Additional PEPS Shares hereunder are subject to the delivery to you on the
Option Closing Date of such updated versions of the documents, certificates and
opinions set
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forth above in this Section 5 as you may reasonably request with respect to the
good standing of the Trust, the Company and the Sellers, the due authorization
and issuance of the Additional PEPS Shares and other matters related to the
issuance of the Additional PEPS Shares.
6. COVENANTS OF THE TRUST AND THE COMPANY. (a) In further
consideration of the agreements of the Underwriters herein contained, the Trust
covenants with each Underwriter as follows:
(i) To notify you immediately, and confirm such notice in
writing, (i) of the institution of any proceedings pursuant to Section
8(e) of the Investment Company Act and (ii) of the happening of any
event during the period described in paragraph (iv) below which in the
judgment of the Trust makes any statement in the Notification, the
Trust Registration Statement or the Trust Prospectus untrue in any
material respect or which requires the making of any change in or
addition to the Notification, the Trust Registration Statement or the
Trust Prospectus in order to make the statements therein not misleading
in any material respect. If at any time the Commission shall issue any
order suspending the effectiveness of the Trust Registration Statement
or an order pursuant to Section 8(e) of the Investment Company Act, the
Fund will make every reasonable effort to obtain the withdrawal of such
order at the earliest possible moment.
(ii) To furnish to you, without charge, three signed copies of
each of the Notification and the Trust Registration Statement
(including exhibits thereto) and for delivery to each other Underwriter
a conformed copy of the Trust Registration Statement (without exhibits
thereto) and to furnish to you in New York City, without charge, prior
to 5:00 P.M. local time on the business day following the date of this
Agreement and during the period mentioned in paragraph (iv) below, as
many copies of the Trust Prospectus and any supplements and amendments
thereto or to the Trust Registration Statement as you may reasonably
request.
(iii) Before amending or supplementing the Trust Registration
Statement or the Trust Prospectus, to furnish to you a copy of each
such proposed amendment or supplement and not to file any such proposed
amendment or supplement to which you or the Trustees
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reasonably object, and to file with the Commission within the
applicable period specified in Rule 497(b) under the Securities Act any
prospectus required to be filed pursuant to such Rule.
(iv) If, during such period after the first date of the public
offering of the PEPS Shares as in the opinion of counsel for the
Underwriters the Trust Prospectus is required by law to be delivered in
connection with sales by an Underwriter or dealer, any event shall
occur or condition exist as a result of which it is necessary to amend
or supplement the Trust Prospectus in order to make the statements
therein, in the light of the circumstances when the Trust Prospectus is
delivered to a purchaser, not misleading, or if, in the opinion of
counsel for the Underwriters, it is necessary to amend or supplement
the Trust Prospectus to comply with applicable law, forthwith to
prepare, file with the Commission and furnish, at its own expense, to
the Underwriters and to the dealers (whose names and addresses you will
furnish to the Trust) to which PEPS Shares may have been sold by you on
behalf of the Underwriters and to any other dealers upon request,
either amendments or supplements to the Trust Prospectus so that the
statements in the Trust Prospectus as so amended or supplemented will
not, in the light of the circumstances when the Trust Prospectus is
delivered to a purchaser, be misleading or so that the Trust
Prospectus, as amended or supplemented, will comply with law.
(v) To endeavor to qualify the PEPS Shares for offer and sale
under the securities or Blue Sky laws of such jurisdictions as you
shall reasonably request.
(vi) To make generally available to the Trust's security
holders and to you as soon as practicable an earning statement covering
the twelve-month period ending December 31, 1996 that satisfies the
provisions of Section 11(a) of the Securities Act.
(vii) Whether or not the transactions contemplated in this
Agreement are consummated or this Agreement is terminated, to pay or
cause to be paid pursuant to the Fund Indemnity Agreement all expenses
incident to the performance of its obligations under this Agreement,
including: (A) the fees, disbursements and expenses of the Trust's
counsel and the Trust's accountants in connection with the registration
and delivery of the PEPS Shares under the Securities Act and all other
fees or expenses in connection with the preparation and
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filing of the Notification, the Trust Registration Statement, any
preliminary prospectus of the Trust, the Trust Prospectus and
amendments and supplements to any of the foregoing, including all
printing costs associated therewith, and the mailing and delivering of
copies thereof to the Underwriters and dealers, in the quantities
hereinabove specified, (B) all costs and expenses related to the
transfer and delivery of the PEPS Shares to the Underwriters, including
any transfer or other taxes payable thereon, (C) the cost of printing
or producing any Blue Sky memorandum in connection with the offer and
sale of the PEPS Shares under state securities laws and all expenses in
connection with the qualification of the PEPS Shares for offer and sale
under state securities laws as provided in paragraph (v) of this
Section 6(a) including filing fees and the reasonable fees and
disbursements of counsel for the Underwriters in connection with such
qualification and in connection with the Blue Sky memorandum, (D) all
filing fees and disbursements of counsel to the Underwriters incurred
in connection with the review and qualification of the offering by the
National Association of Securities Dealers, Inc., (E) all fees and
expenses in connection with the preparation and filing of a
registration statement under the Exchange Act relating to the PEPS
Shares and all costs and expenses incident to listing the PEPS Shares
on the New York Stock Exchange, (F) the cost of printing certificates
representing the PEPS Shares, (G) the costs and charges of any transfer
agent, registrar or depositary for the PEPS Shares, and (H) all other
costs and expenses incident to the performance of the obligations of
the Trust hereunder for which provision is not otherwise made in this
Section. It is understood, however, that except as provided in this
Section 6, Section 7 entitled "Indemnity and Contribution," and the
last paragraph of Section 9 below, the Underwriters will pay all of
their costs and expenses, including fees and disbursements of their
counsel, stock transfer taxes payable on resale of any of the PEPS
Shares by them, and any advertising expenses connected with any offers
they may make.
(b) In further consideration of the agreements of the
Underwriters herein contained, the Company covenants with each Underwriter as
follows:
(i) To furnish to you, without charge, three signed copies of
the Company Registration Statement, the ADS Registration Statement
(including exhibits thereto) and for delivery to
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each other Underwriter a conformed copy of the Company Registration
Statement (without exhibits thereto) and to furnish to you in New York
City, without charge, prior to 10:00 A.M. local time on the business
day next succeeding the date of this Agreement and during the period
mentioned in paragraph (c) below, as many copies of the Company
Prospectus and any supplements and amendments thereto or to the Company
Registration Statement as you may reasonably request.
(ii) Before amending or supplementing the Company Registration
Statement, the ADS Registration Statement or the Company Prospectus, to
furnish to you a copy of each such proposed amendment or supplement and
not to file any such proposed amendment or supplement to which you
reasonably object, and to file with the Commission within the
applicable period specified in Rule 424(b) under the Securities Act any
prospectus required to be filed pursuant to such Rule.
(iii) If, during such period after the first date of the
public offering of the PEPS Shares as in the opinion of counsel for the
Underwriters the Trust Prospectus is required by law to be delivered in
connection with sales by an Underwriter or dealer, any event shall
occur or condition exist as a result of which it is necessary to amend
or supplement the Company Prospectus in order to make the statements in
the Trust Prospectus, in the light of the circumstances when the Trust
Prospectus is delivered to a purchaser of PEPS Shares, not misleading,
or if, in the opinion of counsel for the Underwriters, it is necessary
to amend or supplement the Company Prospectus to comply with applicable
law, forthwith to prepare, file with the Commission and furnish, at its
own expense, to the Underwriters and to the dealers (whose names and
addresses you will furnish to the Company) to which PEPS Shares may
have been sold by you on behalf of the Underwriters and to any other
dealers upon request, either amendments or supplements to the Trust
Prospectus so that the statements in the Trust Prospectus as so amended
or supplemented will not, in the light of the circumstances when the
Trust Prospectus is delivered to a purchaser of PEPS Shares, be
misleading or so that the Company Prospectus, as amended or
supplemented, will comply with law.
(iv) To endeavor to qualify the ADSs for offer and sale under
the securities or Blue Sky laws of such jurisdictions as you shall
reasonably request.
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(v) To maintain, during the period beginning the date hereof
until a date __ days following the Exchange Date, a sponsored program
for the ADSs with the Depositary or other comparable depositary
institution in the United States and to pay all fees and expenses in
connection therewith.
(vi) To make generally available to holders of PEPS Shares and
to you as soon as practicable an earning statement covering the
twelve-month period ending December 31, 1996 that satisfies the
provisions of Section 11(a) of the Securities Act and the rules and
regulations of the Commission thereunder.
(vii) Whether or not the transactions contemplated in this
Agreement are consummated or this Agreement is terminated, to pay or
cause to be paid all expenses incident to the performance of its
obligations under this Agreement, including: (A) the fees,
disbursements and expenses of the Company's counsel and the Company's
accountants in connection with the registration of the shares of Common
Stock and ADSs under the Securities Act and all other fees or expenses
in connection with the preparation and filing of the Company
Registration Statement, the ADS Registration Statement any preliminary
prospectus of the Company, the Company Prospectus and amendments and
supplements to any of the foregoing, including all printing costs
associated therewith, and the mailing and delivering of copies thereof
to the Underwriters and dealers, in the quantities hereinabove
specified, (B) the cost of printing or producing any Blue Sky or Legal
Investment memorandum in connection with the sale of the ADSs under
state securities laws and all expenses in connection with the
qualification of the ADSs for offer and sale under state securities
laws as provided in paragraph (iv) of this Section 6(b), including
filing fees and the reasonable fees and disbursements of counsel for
the Underwriters in connection with such qualification and in
connection with the Blue Sky or Legal Investment memorandum, (C) the
cost of printing certificates representing the ADSs, (D) the costs and
charges of any transfer agent, registrar or depositary for the ADSs,
(E) the costs and expenses of the Company relating to investor
presentations on any "road show" undertaken in connection with the
marketing of the Offering, but limited expressly to travel and lodging
expense of the representatives and officers of the Company and 50% of
the cost of any aircraft chartered in connection with the road show in
Europe, and (F) all other costs and expenses incident to the
performance of
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the obligations of the Company hereunder for which provision is not
otherwise made in this Section. It is understood, however, that except
as provided in this Section 6, Section 7 entitled "Indemnity and
Contribution," and the last paragraph of Section 9 below, the
Underwriters will pay all of their costs and expenses, including fees
and disbursements of their counsel, stock transfer taxes payable on
resale of any of the ADSs by them, and any advertising expenses
connected with any offers they may make.
(c) Each Seller, severally and not jointly, agrees to pay or
cause to be paid (a) all taxes, if any, on the transfer and sale of the ADSs
being sold or pledged by such Seller and (b) such Seller's pro rata share
(determined by dividing the number ADSs to be sold by such Seller pursuant to
the Purchase Contract of such Seller by the total number of ADSs to be sold by
the Sellers under the Purchase Contracts) of all costs and expenses incident to
the performance of the obligations of the Sellers and the Company under this
Agreement, including, but not limited to, the fees and expenses of counsel and
accountants for the Sellers and the Company.
7. INDEMNITY AND CONTRIBUTION. (a) Amway Corporation agrees to
indemnify and hold harmless the Trust, the Company and each Underwriter and each
person, if any, who controls the Trust, the Company or any Underwriter within
the meaning of either Section 15 of the Securities Act or Section 20 of the
Exchange Act, from and against any and all losses, claims, damages and
liabilities (including, without limitation, any legal or other expenses
reasonably incurred by the Trust, the Company or any Underwriter or any such
controlling person in connection with defending or investigating any such action
or claim) caused by any untrue statement or alleged untrue statement of a
material fact contained in the Trust Registration Statement or any amendment
thereof, any preliminary prospectus relating thereto or the Trust Prospectus (as
amended or supplemented if the Trust shall have furnished any amendments or
supplements thereto), or caused by any omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, except insofar as such losses, claims,
damages or liabilities are caused by any such untrue statement or omission or
alleged untrue statement or omission based upon information furnished to the
Trust in writing by such Underwriter through you expressly for use therein.
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(b) The Company agrees to indemnify and hold harmless the
Trust, each Seller and each Underwriter and each person, if any, who controls
the Trust, any Seller or any Underwriter within the meaning of either Section 15
of the Securities Act or Section 20 of the Exchange Act, from and against any
and all losses, claims, damages and liabilities (including, without limitation,
any legal or other expenses reasonably incurred by the Trust, any Seller or any
Underwriter or any such controlling person in connection with defending or
investigating any such action or claim) caused by any untrue statement or
alleged untrue statement of a material fact contained in the Company
Registration Statement or any amendment thereof, the ADS Registration Statement
or any amendment thereof, any preliminary prospectus or the Company Prospectus
(as amended or supplemented if the Company shall have furnished any amendments
or supplements thereto), or caused by any omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, except insofar as such losses, claims,
damages or liabilities are caused by any such untrue statement or omission or
alleged untrue statement or omission based upon information furnished to the
Company in writing by such Underwriter through you expressly for use therein.
The Company agrees to indemnify and hold harmless the Trust, each Seller and
each Underwriter and each person, if any, who controls the Trust, any Seller or
any Underwriter within the meaning of either Section 15 of the Securities Act or
Section 20 of the Exchange Act, from and against any and all losses, claims,
damages and liabilities (including, without limitation, any legal or other
expenses reasonably incurred by the Trust, any Seller or any Underwriter, in
connection with defending or investigating any such action or claim) caused by
any untrue statement or alleged untrue statement of a material fact contained in
the Trust Registration Statement or any amendment thereof, any preliminary
prospectus or the Trust Prospectus (as amended or supplemented if the Trust
shall have furnished any amendments or supplements thereto), or caused by any
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, but
only with reference to information relating to the Company.
(c) The HDV Group agrees to indemnify and hold harmless the
Company, the Trust and each Underwriter and each person, if any, who controls
the Company, the Trust or any Underwriter within the meaning of either Section
15 of the Securities Act or Section 20 of the Exchange Act, from and against any
and all losses, claims, damages and liabilities (including, without limitation,
any legal or
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other expenses reasonably incurred by the Company, the Trust or any Underwriter
in connection with defending or investigating any such action or claim) caused
by any untrue statement or alleged untrue statement of a material fact contained
in the Company Registration Statement or any Amendment thereof, any preliminary
prospectus or the Company Prospectus, (as amended or Supplemented if the Company
shall have furnished any amendments or supplements thereto), or caused by any
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statement therein not misleading, but
only with reference to information relating to the HDV Group.
(d) The JVA Group agrees to indemnify and hold harmless the
Company, the Trust and each Underwriter and each person, if any, who controls
the Company, the Trust or any Underwriter within the meaning of either Section
15 of the Securities Act or Section 20 of the Exchange Act, from and against any
and all losses, claims, damages and liabilities (including, without limitation,
any legal or other expenses reasonably incurred by the Company, the Trust or any
Underwriter in connection with defending or investigating any such action or
claim) caused by any untrue statement or alleged untrue statement of a material
fact contained in the Company Registration Statement or any Amendment thereof,
any preliminary prospectus or the Company Prospectus, (as amended or
Supplemented if the Company shall have furnished any amendments or supplements
thereto), or caused by any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statement
therein not misleading, but only with reference to information relating to the
JVA Group.
(e) Each Underwriter agrees, severally and not jointly, to
indemnify and hold harmless the Trust, the Company and each Seller, and any of
their directors and officers who sign the Registration Statements and each
person, if any, who controls the Trust, the Company or the Sellers within the
meaning of either Section 15 of the Securities Act or Section 20 of the Exchange
Act from and against any and all losses, claims, damages and liabilities
(including, without limitation, any legal or other expenses reasonably incurred
in connection with defending or investigating any such action or claim) caused
by any untrue statement or alleged untrue statement of a material fact contained
in the Registration Statements or any amendment thereof, any preliminary
prospectuses or the Prospectuses (as amended or supplemented if the Trust or the
Company shall have furnished any amendments or supplements thereto), or caused
by any omission or alleged omission to state therein a material fact required to
be stated therein or
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necessary to make the statements therein not misleading, but only with reference
to information relating to such Underwriter furnished to the Trust or the
Company in writing by such Underwriter through you expressly for use in the
Registration Statements, any preliminary prospectuses, the Prospectuses or any
amendments or supplements thereto.
(f) In case any proceeding (including any governmental
investigation) shall be instituted involving any person in respect of which
indemnity may be sought pursuant to paragraph (a), (b), (c), (d) or (e) of this
Section 7, such person (the "indemnified party") shall promptly notify the
person against whom such indemnity may be sought (the "indemnifying party") in
writing and the indemnifying party, upon request of the indemnified party, shall
retain counsel reasonably satisfactory to the indemnified party to represent the
indemnified party and any others the indemnifying party may designate in such
proceeding and shall pay the fees and disbursements of such counsel related to
such proceeding. In any such proceeding, any indemnified party shall have the
right to retain its own counsel, but the fees and expenses of such counsel shall
be at the expense of such indemnified party unless (i) the indemnifying party
and the indemnified party shall have mutually agreed to the retention of such
counsel or (ii) the named parties to any such proceeding (including any
impleaded parties) include both the indemnifying party and the indemnified party
and representation of both parties by the same counsel would be inappropriate
due to actual or potential differing interests between them. It is understood
that the indemnifying party shall not, in respect of the legal expenses of any
indemnified party in connection with any proceeding or related proceedings in
the same jurisdiction, be liable for (i) the fees and expenses of more than one
separate firm (in addition to any local counsel) for all Underwriters and all
persons, if any, who control any Underwriter within the meaning of either
Section 15 of the Securities Act or Section 20 of the Exchange Act, (ii) the
fees and expenses of more than one separate firm (in addition to any local
counsel) for the Company, its officers and directors who sign the Company
Registration Statement and each person, if any who controls the Company within
the meaning of either such Section and (iii) the fees and expenses of more than
one separate firm (in addition to any local counsel) for both Sellers and all
persons, if any, who control either Seller within the meaning of either such
Section, and that all such fees and expenses shall be reimbursed as they are
incurred. In the case of any such separate firm for the Underwriters and such
control persons of Underwriters, such firm shall be designated in writing by
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated. In the case of any such
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separate firm for the Company and such directors, officers and control persons
of the Company, such firm shall be designated in writing by the Company. In the
case of any such separate firm for the Sellers and such controlling persons of
the Sellers, such firm shall be designated in writing by ________. The
indemnifying party shall not be liable for any settlement of any proceeding
effected without its written consent, but if settled with such consent or if
there be a final judgment for the plaintiff, the indemnifying party agrees to
indemnify the indemnified party from and against any loss or liability by reason
of such settlement or judgment. Notwithstanding the foregoing sentence, if at
any time an indemnified party shall have requested an indemnifying party to
reimburse the indemnified party for fees and expenses of counsel as contemplated
by the second and third sentences of this paragraph, the indemnifying party
agrees that it shall be liable for any settlement of any proceeding effected
without its written consent if (i) such settlement is entered into more than 30
days after receipt by such indemnifying party of the aforesaid request and (ii)
such indemnifying party shall not have reimbursed the indemnified party in
accordance with such request prior to the date of such settlement. No
indemnifying party shall, without the prior written consent of the indemnified
party, effect any settlement of any pending or threatened proceeding in respect
of which any indemnified party is or could have been a party and indemnity could
have been sought hereunder by such indemnified party, unless such settlement
includes an unconditional release of such indemnified party from all liability
on claims that are the subject matter of such proceeding.
(g) To the extent the indemnification provided for in
paragraph (a), (b), (c), (d) or (e) of this Section 7 is unavailable to an
indemnified party or insufficient in respect of any losses, claims, damages or
liabilities referred to therein, then each indemnifying party under such
paragraph, in lieu of indemnifying such indemnified party thereunder, shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages or liabilities (i) in such proportion as is
appropriate to reflect the relative benefits received by the indemnifying party
or parties on the one hand and the indemnified party or parties on the other
hand from the offering of the PEPS Shares or (ii) if the allocation provided by
clause (i) above is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause (i)
above but also the relative fault of the indemnifying party or parties on the
one hand and of the indemnified party or
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parties on the other hand in connection with the statements or omissions that
resulted in such losses, claims, damages or liabilities, as well as any other
relevant equitable considerations. The relative benefits received by the Trust,
the Sellers, the Company and Amway on the one hand and the Underwriters on the
other hand in connection with the offering of the PEPS Shares shall be deemed to
be in the same respective proportions as the net proceeds from the offering of
the PEPS Shares (before deducting expenses) received by the Trust and the total
underwriting discounts and commissions received by the Underwriters, in each
case as set forth in the table on the cover of the Trust Prospectus, bear to the
aggregate Public Offering Price of the PEPS Shares. The relative fault of the
Trust, the Sellers, the Company and Amway on the one hand and the Underwriters
on the other hand 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 Trust, the Company, the Sellers or Amway, on the one hand, or by
the Underwriters on the other hand and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission. The Underwriters' respective obligations to contribute pursuant to
this Section 7 are several in proportion to the respective number of Shares they
have purchased hereunder, and not joint.
(h) The Trust, the Company, the Sellers and the Underwriters
agree that it would not be just or equitable if contribution pursuant to this
Section 7 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
that does not take account of the equitable considerations referred to in
paragraph (e) of this Section 7. The amount paid or payable by an indemnified
party as a result of the losses, claims, damages and liabilities referred to in
the immediately preceding paragraph shall be deemed to include, subject to the
limitations set forth above, any legal or other expenses reasonably incurred by
such indemnified party in connection with investigating or defending any such
action or claim. Notwithstanding the provisions of this Section 7, no
Underwriter shall be required to contribute any amount in excess of the amount
by which the total price at which the PEPS Shares underwritten by it and
distributed to the public were offered to the public exceeds the amount of any
damages that such Underwriter has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of
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the Securities Act) shall be entitled to contribution from any person who was
not guilty of such fraudulent misrepresentation. The remedies provided for in
this Section 7 not exclusive and shall not limit any rights or remedies which
may otherwise be available to any indemnified party at law or in equity.
(i) The indemnity and contribution provisions contained in
this Section 7 and the representations, warranties and other statements of the
Trust, the Company and the Sellers contained in this Agreement shall remain
operative and in full force and effect regardless of (i) any termination of this
Agreement, (ii) any investigation made by or on behalf of any Underwriter or any
person controlling any Underwriter or by or on behalf of the Trust, the Company,
the Sellers, any of their respective officers or directors or any person
controlling the Trust, the Company or the Sellers and (iii) acceptance of and
payment for any of the PEPS Shares.
8. TERMINATION. This Agreement shall be subject to termination
by notice given by you to the Trust, the Company and the Sellers, if (a) after
the execution and delivery of this Agreement and prior to the Closing Date (i)
trading generally shall have been suspended or materially limited on or by, as
the case may be, any of the New York Stock Exchange, the American Stock
Exchange, the Tokyo Stock Exchange, the Osaka Stock Exchange, the National
Association of Securities Dealers, Inc., the Chicago Board of Options Exchange,
the Chicago Mercantile Exchange or the Chicago Board of Trade, (ii) trading of
any securities of the Trust or the Company shall have been suspended on any
exchange or in any over-the-counter market, (iii) a general moratorium on
commercial banking activities in New York shall have been declared by either
Japanese, U.S. Federal or New York State authorities or (iv) there shall have
occurred any outbreak or escalation of hostilities or any change in financial
markets or any calamity or crisis that, in your judgment, is material and
adverse and (b) in the case of any of the events specified in clauses (a)(i)
through (iv), such event, singly or together with any other such event, makes
it, in your judgment, impracticable to market the PEPS Shares on the terms and
in the manner contemplated in the Trust Prospectus.
9. EFFECTIVENESS; DEFAULTING UNDERWRITERS. This Agreement
shall become effective upon the execution and delivery hereof by the parties
hereto.
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If, on the Closing Date or the Option Closing Date, as the
case may be, any one or more of the Underwriters shall fail or refuse to
purchase PEPS Shares that it has or they have agreed to purchase hereunder on
such date, and the aggregate number of PEPS Shares which such defaulting
Underwriter or Underwriters agreed but failed or refused to purchase is not more
than one-tenth of the aggregate number of the PEPS Shares to be purchased on
such date, the other Underwriters shall be obligated severally in the
proportions that the number of Firm PEPS Shares set forth opposite their
respective names in Schedule I or Schedule II bears to the aggregate number of
Firm PEPS Shares set forth opposite the names of all such non-defaulting
Underwriters, or in such other proportions as you may specify, to purchase the
PEPS Shares which such defaulting Underwriter or Underwriters agreed but failed
or refused to purchase on such date; provided that in no event shall the number
of PEPS Shares that any Underwriter has agreed to purchase pursuant to this
Agreement be increased pursuant to this Section 9 by an amount in excess of
one-ninth of such number of PEPS Shares without the written consent of such
Underwriter. If, on the Closing Date, any Underwriter or Underwriters shall fail
or refuse to purchase Firm PEPS Shares and the aggregate number of Firm PEPS
Shares with respect to which such default occurs is more than one-tenth of the
aggregate number of Firm PEPS Shares to be purchased, and arrangements
satisfactory to you, the Trust and the Sellers for the purchase of such Firm
PEPS Shares are not made within 36 hours after such default, this Agreement
shall terminate without liability on the part of any non-defaulting Underwriter,
the Trust or either Seller. In any such case either you, the Trust or either
Seller shall have the right to postpone the Closing Date, but in no event for
longer than seven days, in order that the required changes, if any, in the
Registration Statements and in the Prospectuses or in any other documents or
arrangements may be effected. If, on the Option Closing Date, any Underwriter or
Underwriters shall fail or refuse to purchase Additional PEPS Shares and the
aggregate number of Additional PEPS Shares with respect to which such default
occurs is more than one-tenth of the aggregate number of Additional PEPS Shares
to be purchased, the non-defaulting Underwriters shall have the option to (i)
terminate their obligation hereunder to purchase Additional PEPS Shares or (ii)
purchase not less than the number of Additional PEPS Shares that such
non-defaulting Underwriters would have been obligated to purchase in the absence
of such default. Any action taken under this paragraph shall not relieve any
defaulting Underwriter from liability in respect of any default of such
Underwriter under this Agreement.
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If this Agreement shall be terminated by the Underwriters, or
any of them, because of any failure or refusal on the part of the Trust, the
Company or either Seller to comply with the terms or to fulfill any of the
conditions of this Agreement, or if for any reason the Trust, the Company or
either Seller shall be unable to perform its obligations under this Agreement,
the Trust, the Company and the Sellers, severally and not jointly, will
reimburse the Underwriters or such Underwriters as have so terminated this
Agreement with respect to themselves, severally, for all out-of-pocket expenses
(including the fees and disbursements of their counsel) reasonably incurred by
such Underwriters in connection with this Agreement or the offering contemplated
hereunder.
10. COUNTERPARTS. This Agreement may be signed in two or more
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.
11. APPLICABLE LAW. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of New York.
12. LITIGATION. Each of the Company, the Trust and each member
of the HDV Group and the JVA Group irrevocably agrees that any legal suit,
action or proceeding against it brought by any Underwriter or by any person who
controls any Underwriter arising out of or based upon this Agreement or the
transactions contemplated hereby may be instituted in any state or federal court
in the Borough of Manhattan, The City of New York, New York, irrevocably waives,
to the fullest extent permissible by law, any objection which it may now or
hereafter have to the laying of venue of any such proceeding and irrevocably
submits to the non-exclusive jurisdiction of such courts in any such suit,
action or proceeding. Each of the Company, the Trust and each member of the HDV
Group and the JVA Group has appointed CT Corporation System, ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ as its authorized agent (the "Authorized Agent") upon which
process may be served in any such action arising out of or based on this
Agreement or the transactions contemplated hereby which may be instituted in any
state or federal court in the Borough of Manhattan, The City of New York, New
York, by any Underwriter or by any person who controls any Underwriter,
expressly consents to the jurisdiction of any such court in respect of any such
action, and waives any other requirements of or objections
56
58
to personal jurisdiction with respect thereto. Such appointment shall be
irrevocable. Each of the Company, the Trust and each member of the HDV Group and
the JVA Group represents and warrant that the Authorized Agent has agreed to act
as said agent for service of process, and each of the Company, the Trust and
each member of the HDV Group and the JVA Group agrees to take any and all
action, including the filing of any and all documents, that may be necessary to
continue such appointment in full force and effect as aforesaid. Service of
process upon the Authorized Agent and written notice of such service to the
Company, the Trust or the relevant member of the HDV Group or the JVA Group, as
the case may be, shall be deemed, in every respect, effective service of process
upon the Company and, the Trust and each member of the HDV Group and the JVA
Group. Each of the Company hereby irrevocably waives any immunity to
jurisdiction to which they may otherwise be entitled or become entitled
(including sovereign immunity and immunity to pre-judgment attachment and
execution) in any legal suit, action or proceeding against it arising out of or
based on this Agreement or the transactions contemplated hereby which is
instituted in any state or federal court in the Borough of Manhattan, The City
of New York, New York. Notwithstanding the foregoing, any action based on this
Agreement may be instituted against the Company by any U.S. Underwriter in any
competent court in the Republic of Japan.
If for the purposes of obtaining judgment in any court it is
necessary to convert a sum due hereunder into any currency other than U.S.
dollars, the parties hereto agree, to the fullest extent that they may
effectively do so, that the rate of exchange used shall be the rate at which in
accordance with normal banking procedures ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
could purchase U.S. dollars with such other currency in The City of New York on
the business day preceding that on which final judgment is given. The obligation
of any party in respect of any sum due from it to any Underwriter shall,
notwithstanding any judgment in a currency other than U.S. dollars, be
discharged only if and to the extent that on the first business day following
receipt by such Underwriter of any sum adjudged to be so due in such other
currency, such Underwriter may in accordance with normal banking procedures
purchase such U.S. dollars with such other currency as it would have purchased
on the business day preceding that on which the final judgment is rendered; if
the U.S. dollars so purchased are less than the sum originally due to such
Underwriter hereunder, such party agrees, as a separate obligation and
notwithstanding any such judgment, to indemnify such Underwriter against such
loss. If the U.S. dollars so purchased are greater than the sum originally due
to such Underwriter hereunder, such
57
59
Underwriter agrees to pay to such party an amount equal to the excess of the
dollars so purchased over the sum originally due to such Underwriter hereunder.
13. HEADINGS. The headings of the sections of this Agreement
have been inserted for convenience of reference only and shall not be deemed a
part of this Agreement.
Very truly yours,
AJL PEPS TRUST
______________________, as trustee,
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ III
______________________, as trustee, and
▇▇▇▇▇ ▇. ▇'▇▇▇▇▇
______________________, as trustee,
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
each as trustee of AJL PEPS TRUST
AMWAY JAPAN LIMITED
By_____________________________
Name:
Title:
HDV GRIT HOLDINGS, INC.
By__________________________
Name:
Title:
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60
HDV GRANTOR RETAINED INCOME TRUST:
_____________________, as trustee,
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇.
_____________________, as trustee,
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
each as trustee of
HDV GRANTOR RETAINED
INCOME TRUST
▇▇▇ ▇▇▇ ▇▇▇▇▇ TRUST
By__________________, as trustee
▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇
_____________________
▇▇▇ ▇▇▇ ▇▇▇▇▇
AMWAY CORPORATION
By______________________________
Name:
Title:
59
61
Accepted as of the date hereof
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Acting severally on behalf
of themselves and the
several U.S. Underwriters
named in Schedule I hereto.
By ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co.
Incorporated
By___________________________
Name:
Title:
Accepted as of the date hereof
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. International Limited
▇▇▇▇▇▇▇ ▇▇▇▇▇ International Limited
Acting severally on behalf
of themselves and the
several International
Underwriters named in
Schedule II hereto.
By ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co.
International Limited
By___________________________
Name:
Title:
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62
SCHEDULE I
Number of
Firm PEPS Shares
Underwriter To Be Purchased
----------- ---------------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
[NAMES OF OTHER UNDERWRITERS]
---------------
Total ........
===============
63
SCHEDULE II
Number of
Firm PEPS Shares
Underwriter To Be Purchased
----------- ---------------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. International Limited
▇▇▇▇▇▇▇ ▇▇▇▇▇ International Limited
[NAMES OF OTHER UNDERWRITERS]
---------------
Total ........
===============
64
Exhibit A
[FORM OF LOCK-UP CONTRACT]
November __, 1995
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co.
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
c/o Morgan ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Dear Sirs:
The undersigned understands that you, as Representatives of
the several Underwriters, propose to enter into an underwriting agreement (the
"Underwriting Agreement") with, among others, AJL PEPS Trust, a trust organized
under the laws of the State of New York (the "Trust") providing for the public
offering (the "Public Offering") by the several Underwriters, including
yourselves, of Premium Exchangeable Participating Shares (no par value) of the
Trust (the "PEPS"), which are mandatorily exchangeable in 1999 for American
Depositary Shares ("ADSs"), each representing one-half of one share of common
stock, no par value (the "Common Stock") of Amway Japan Limited, a Japanese
corporation (the "Company") or, at the option of the holder of PEPS, an
equivalent in shares of Common Stock.
In consideration of the Underwriters' agreement to purchase
and make the Public Offering of the PEPS, and for other good and valuable
consideration receipt of which is hereby acknowledged, the undersigned hereby
agrees it will not, for a period of 90 days from the date of the final domestic
and international prospectuses relating to the Public Offering which are
initially filed under Rule 424(b) of the Securities of Act of 1933, as amended,
by the Trust with respect to the Public Offering, and except as otherwise
provided herein or contemplated by the terms of the Underwriting Agreement,
without your prior written consent, (1) offer, pledge, sell, contract to sell,
sell any option or contract to purchase, purchase any option or contract to
sell, grant any option, right or warrant to purchase, or otherwise transfer or
dispose of, directly or indirectly, any ADSs or shares of Common Stock or any
securities convertible into or exercisable or exchangeable for ADSs or
65
shares of Common Stock (whether such ADSs or shares of Common Stock or any such
securities are now owned by the undersigned or are hereafter acquired), or (2)
enter into any swap or other agreement that transfers, in whole or in part, any
of the economic consequences of ownership of the ADSs or shares of Common Stock,
whether any such transaction described in clause (1) or (2) above is to be
settled by delivery of ADSs, shares of Common Stock or such other securities, in
cash or otherwise; except that the undersigned may, without your consent,
transfer ADSs or shares of Common Stock or securities convertible into or
exercisable or exchangeable for ADSs or Common Stock pursuant to (x) certain
permitted private sale transactions among members of the ▇▇▇▇▇ and ▇▇▇ ▇▇▇▇▇
Families (as defined below) or any entity directly or indirectly controlled by
members of the ▇▇▇ ▇▇▇▇▇ or ▇▇▇▇▇ Families or entities directly or indirectly
controlled by any of them (collectively, the "Affiliated Entities") in which the
transferee agrees in writing to be bound by the provisions hereof to the same
extent as the transferor is bound hereunder, (y) existing or prospective
employee stock option plans previously disclosed to the Underwriters and (z) a
bona fide gift or gifts among members of the ▇▇▇▇▇ and ▇▇▇ ▇▇▇▇▇ Families or the
Affiliated Entities or to a charitable or educational organization which is a
tax-exempt organization under Section 501(c)(3) of the Internal Revenue Code of
1986, as amended if the donee agrees in writing to be bound by the provisions
hereof to the same extent as the donor is bound hereunder. For purposes of this
letter "▇▇▇ ▇▇▇▇▇ and ▇▇▇▇▇ Families" shall mean ▇▇. ▇▇▇ ▇▇▇ ▇▇▇▇▇ and ▇▇.
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ and any and all of the following: their spouses, parents,
brothers, sisters, brothers-in-law, sisters-in-law, children and grandchildren
(whether natural or adopted), daughters-in-law, sons-in-law and blood relatives
not more remote than first cousin.
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Very truly yours,
________________________
(Name)
________________________
(Address)
Accepted as of the date
first set forth above:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & CO. INCORPORATED
By:_______________________