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EXHIBIT 1.2
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▇▇▇▇▇ WHEELS INTERNATIONAL, INC.
(a Delaware corporation)
779,502 Shares of Common Stock
INTERNATIONAL PURCHASE AGREEMENT
Dated: August , 1997
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TABLE OF CONTENTS
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INTERNATIONAL PURCHASE AGREEMENT .................................. 1
SECTION 1. Representations and Warranties ....................... 4
(a) Representations and Warranties by the
Company .............................................. 4
(i) Compliance with Registration
Requirements ............................. 4
(ii) Incorporated Documents .................... 5
(iii) Independent Accountants ................... 5
(v) No Material Adverse Change in Business .... 6
(vi) Good Standing of the Company
and the Subsidiaries ...................... 7
(vii) Capitalization ............................ 8
(viii) Authorization of Agreement ................ 8
(ix) Authorization and Description
of Securities ........................... 8
(x) Absence of Defaults and Conflicts ........ 8
(xi) Certain Tax Matters ...................... 9
(xii) Absence of Proceedings ................... 9
(xiii) Accuracy of Exhibits ..................... 10
(xiv) Possession of Intellectual Property ...... 10
(xv) Absence of Further Requirements .......... 10
(xvi) Possession of Licenses and Permits ....... 11
(xvii) Title to Property ........................ 11
(xviii) Investment Company Act ................... 11
(xix) Environmental Laws ....................... 11
(xx) Compliance with Regulation M ............. 12
(b) Representations and Warranties by the
Selling Shareholders .................................. 12
(i) Accurate Disclosure ...................... 12
(ii) Authorization of Agreements .............. 12
(iii) Good and Marketable Title ................ 13
(iv) Due Execution of Power
of Attorney and Custody Agreement ........ 13
(v) Absence of Manipulation .................. 14
(vi) Absence of Further Requirements .......... 14
(vii) Certificates Suitable for Transfer ....... 14
(viii) No Association with NASD ................. 15
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(c) Officer's Certificates ............................... 15
SECTION 2. Sale and Delivery to International
Managers; Closing .................................... 15
(a) Initial Securities ................................... 15
(b) Option Securities .................................... 16
(c) Payment .............................................. 16
(d) Denominations; Registration .......................... 17
SECTION 3. Covenants of the Company ............................. 17
(a) Compliance with Securities Regulations and
Commission Requests .................................. 17
(b) Filing of Amendments ................................. 18
(c) Delivery of Registration Statements .................. 18
(d) Delivery of Prospectuses ............................. 18
(e) Continued Compliance with Securities Laws ............ 19
(f) Blue Sky Qualifications .............................. 19
(g) Rule 158 ............................................. 20
(h) Use of Proceeds ...................................... 20
(i) Listing .............................................. 20
(j) Restriction on Sale of Securities .................... 20
(k) Reporting Requirements ............................... 20
SECTION 4. Payment of Expenses ................................. 20
(a) Expenses ............................................. 20
(b) Expenses of the Selling Shareholders ................. 21
(c) Termination of Agreement ............................. 21
(d) Allocation of Expenses ............................... 22
SECTION 5. Conditions of International Managers' Obligations..... 22
(a) Effectiveness of Registration Statement .............. 22
(b) Opinion of Counsel for Company ....................... 22
(c) Opinion of Counsels for the Selling Shareholders...... 23
(d) Opinion of Counsel for International Managers ........ 23
(e) Officers' Certificate ................................ 23
(f) Certificate of Selling Shareholders .................. 24
(g) Accountant's Comfort Letter .......................... 24
(h) Bring-down Comfort Letter ............................ 24
(i) Approval of Listing .................................. 24
(j) No Objection ......................................... 24
(k) Lock-up Agreements ................................... 24
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(l) Purchase of Initial International Securities ......... 25
(m) Conditions to Purchase of
International Option Securities ...................... 25
(i) Officers' Certificate ..................... 25
(ii) Opinion of Counsel for Company ............ 25
(iii) Opinion of Counsel for
International Managers .................... 25
(iv) Bring-down Comfort Letter ................. 25
(n) Additional Documents ................................. 26
(o) Termination of Agreement ............................. 26
SECTION 6. Indemnification .................................... 26
(a) Indemnification of International
Managers ............................................. 26
(b) Indemnification of Company, Directors,
Officers and Selling Shareholders .................... 28
(c) Actions against Parties; Notification ................ 28
(d) Settlement without Consent if Failure
to Reimburse ......................................... 29
(e) Other Agreements with Respect to
Indemnification ...................................... 29
SECTION 7. Contribution ........................................ 29
SECTION 8. Representations, Warranties and
Agreements to Survive Delivery ...................... 32
SECTION 9. Termination of Agreement ............................ 32
(a) Termination; General ................................. 32
(b) Liabilities .......................................... 33
SECTION 10. Default by One or More of the
International Managers ............................. 33
SECTION 11. Default by One or More of the
Selling Shareholders ............................... 33
SECTION 12. Notices ............................................ 34
SECTION 13. Parties ............................................ 34
SECTION 14. Information Supplied by the Selling
Shareholders ....................................... 34
SECTION 15. GOVERNING LAW AND TIME ............................. 35
SECTION 16. Effect of Headings ................................. 35
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SCHEDULES
Schedule A -List of Underwriters Sch A-1
Schedule B -List of Selling Shareholders Sch B-1
Schedule C -Pricing Information Sch C-1
Schedule D -List of Subsidiaries Sch D-1
Schedule E -List of Persons Subject to Lock-up Sch E-1
EXHIBITS
Exhibit A - Form of Opinion of Company's
Counsel ..........................................A-1
Exhibit B - Form of Opinion for the Selling
Shareholders' Counsel ............................B-1
Exhibit C - Form of Lock-up Letter ............................C-1
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▇▇▇▇▇ WHEELS INTERNATIONAL, INC.
(a Delaware corporation)
779,502 Shares of Common Stock
(Par Value $.01 Per Share)
INTERNATIONAL PURCHASE AGREEMENT
Dated: August , 1997
▇▇▇▇▇▇▇ ▇▇▇▇▇ INTERNATIONAL
BEAR, ▇▇▇▇▇▇▇ INTERNATIONAL LIMITED
▇▇▇▇▇▇▇ ▇▇▇▇▇ INTERNATIONAL
c/o Merrill ▇▇▇▇▇ International
Ropemaker Place
▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇
Ladies and Gentlemen:
▇▇▇▇▇ Wheels International, Inc., a Delaware corporation (the "Company"),
and ▇▇▇▇ ▇▇▇▇▇▇-▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ (the "Selling
Shareholders") confirm their respective agreements with ▇▇▇▇▇▇▇ ▇▇▇▇▇
International ("▇▇▇▇▇▇▇ ▇▇▇▇▇"), Bear, ▇▇▇▇▇▇▇ International Limited and
▇▇▇▇▇▇▇ ▇▇▇▇▇ International (collectively, the "International Managers" which
term shall also include any underwriter substituted as hereinafter provided in
Section 10 hereof), with respect to (i) the sale by the Company and each
Selling Shareholder, acting severally and not jointly, and the purchase by the
International Managers, acting severally and not jointly, of the respective
numbers of shares of Common Stock, par value $0.01 per share, of the Company
("Common Stock") set forth in Schedules A and B hereto and (ii) the grant by
the Company to the International Managers, acting severally and not jointly, of
the option described in Section 2(b) hereof to purchase all or any part of
116,925 additional shares of Common Stock solely to cover over-allotments, if
any. The aforesaid 779,502 shares of Common Stock (the "Initial International
Securities") to be purchased by the International Managers and all or any part
of the 116,925 shares of Common Stock subject to the option described in
Section 2(b) hereof (the "International Option Securities") are hereinafter
called, collectively, the "International Securities."
It is understood that the Company and the Selling Shareholders are
concurrently entering into an agreement dated the date hereof (the "U.S.
Purchase Agreement") providing for the sale by the Company and each Selling
Shareholder of an aggregate of 3,000,000 shares of Common Stock (the "Initial
U.S.
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Securities") through arrangements with certain underwriters in the United
States and Canada (the "U.S. Underwriters") and the grant by the Company to the
U.S. Underwriters, acting severally and not jointly, of an option to purchase
all or any part of the U.S. Underwriters' pro rata portion of up to 450,000
additional shares of Common Stock solely to cover overallotments, if any (the
"U.S. Option Securities" and together, with the International Option
Securities, the "Option Securities"). The Initial U.S. Securities and the U.S.
Option Securities are hereinafter called the "U.S. Securities". It is
understood that the Company is not obligated to sell, and the International
Managers are not obligated to purchase, any Initial International Securities
unless all of the Initial U.S. Securities are contemporaneously purchased by
the U.S. Underwriters.
The International Managers and the U.S. Underwriters are hereinafter
collectively called the "Underwriters," the Initial International Securities
and the Initial U.S. Securities are hereinafter collectively called the
"Initial Securities," and the International Securities and the U.S. Securities
are hereinafter collectively called the "Securities."
The Underwriters will concurrently enter into an Intersyndicate Agreement
of even date herewith (the "Intersyndicate Agreement") providing for the
coordination of certain transactions among the Underwriters under the direction
of ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated (in
such capacity, the "Global Coordinator").
The Company and the Selling Shareholders understand that the International
Managers propose to make a public offering of the International Securities as
soon as the International Managers deem advisable after this Agreement has been
executed and delivered.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (No. 333-31669) covering the
registration of the Securities under the Securities Act of 1933, as amended
(the "1933 Act"), including the related preliminary prospectus or prospectuses.
Promptly after execution and delivery of this Agreement, the Company will
either (i) prepare and file a prospectus in accordance with the provisions of
Rule 430A ("Rule 430A") of the rules and regulations of the Commission under
the 1933 Act (the "1933 Act Regulations") and paragraph (b) of Rule 424 ("Rule
424(b)") of the 1933 Act Regulations or (ii) if the Company has elected to rely
upon Rule 434 ("Rule 434") of the 1933 Act Regulations, prepare and file a term
sheet (a "Term Sheet") in accordance with the provisions of Rule 434 and Rule
424(b). Two forms of prospectus are to be used in connection with the offering
and sale of the Securities: one relating to the International Securities (the
"Form of International Prospectus") and one relating to the U.S. Securities
(the "Form of U.S. Pro-
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spectus"). The Form of U.S. Prospectus is identical to the Form of
International Prospectus, except for the front cover and back cover pages and
the information under the caption "Underwriting", "Legal Matters", "Experts"
and the inclusion in the Form of International Prospectus of a section under
the caption "Certain United States Federal Tax Consequences for Non-U.S.
Stockholders". The information included in such prospectus or in such Term
Sheet, as the case may be, that was omitted from such registration statement at
the time it became effective but that is deemed to be part of such registration
statement at the time it became effective (a) pursuant to paragraph (b) of Rule
430A is referred to as "Rule 430A Information" or (b) pursuant to paragraph (d)
of Rule 434 is referred to as "Rule 434 Information." Each Form of
International Prospectus and Form of U.S. Prospectus used before such
registration statement became effective, and any prospectus that omitted, as
applicable, the Rule 430A Information or the Rule 434 Information, that was
used after such effectiveness and prior to the execution and delivery of this
Agreement, is herein called a "preliminary prospectus." Such registration
statement, including the exhibits thereto, schedules thereto, if any, and the
documents incorporated by reference therein pursuant to Item 12 of Form S-3
under the 1933 Act, at the time it became effective and including the Rule 430A
Information and the Rule 434 Information, as applicable, is herein called the
"Registration Statement." Any registration statement filed pursuant to Rule
462(b) of the 1933 Act Regulations is herein referred to as the "Rule 462(b)
Registration Statement," and after such filing the term "Registration
Statement" shall include the Rule 462(b) Registration Statement. The final
Form of International Prospectus and the final Form of U.S. Prospectus,
including the documents incorporated by reference therein pursuant to Item 12
of Form S-3 under the 1933 Act, in the form first furnished to the Underwriters
for use in connection with the offering of the Securities is herein called the
"International Prospectus" and the "U.S. Prospectus," respectively, and
collectively, the "Prospectuses." If Rule 434 is relied on, the term
"International Prospectus" and "U.S. Prospectus" shall refer to the preliminary
International Prospectus dated August 4, 1997 and the preliminary U.S.
Prospectus dated August 4, 1997, respectively, each together with the
applicable Term Sheet and all references in this Agreement to the date of such
Prospectuses shall mean the date of the applicable Term Sheet. For purposes of
this Agreement, all references to the Registration Statement, any preliminary
prospectus, the International Prospectus, the U.S. Prospectus or any Term Sheet
or any amendment or supplement to any of the foregoing shall (i) be deemed to
include the copy filed with the Commission pursuant to its Electronic Data
Gathering, Analysis and Retrieval system ("▇▇▇▇▇") and (ii) be deemed not to
include the forms of preliminary Prospectuses dated July 23, 1997.
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All references in this Agreement to financial statements and schedules
and other information which is "contained," "included" or "stated" in the
Registration Statement, any preliminary prospectus (including the Form of
International Prospectus and the Form of U.S. Prospectus) or the Prospectuses
(or other references of like import) shall be deemed to mean and include all
such financial statements and schedules and other information which is
incorporated by reference in the Registration Statement, any preliminary
prospectus (including the Form of International Prospectus and the Form of U.S.
Prospectus) or the Prospectuses, as the case may be; and all references in this
Agreement to amendments or supplements to the Registration Statement, any
preliminary prospectus or the Prospectuses shall be deemed to mean and include
the filing of any document under the Securities Exchange Act of 1934 (the "1934
Act") which is incorporated by reference in the Registration Statement, such
preliminary prospectus or the Prospectuses, as the case may be.
SECTION 1. Representations and Warranties.
(a) REPRESENTATIONS AND WARRANTIES BY THE COMPANY. The Company
represents and warrants to each International Manager as of the date hereof,
as of the Closing Time referred to in Section 2(c) hereof, and as of each Date
of Delivery (if any) referred to in Section 2(b) hereof, and agrees with each
International Manager, as follows:
(i) Compliance with Registration Requirements. The Company meets
the requirements for use of Form S-3 under the 1933 Act. Each of the
Registration Statement and any Rule 462(b) Registration Statement has
become effective under the 1933 Act and no stop order suspending the
effectiveness of the Registration Statement or any Rule 462(b)
Registration Statement has been issued under the 1933 Act and no
proceedings for that purpose have been instituted or are pending or, to
the knowledge of the Company, are contemplated by the Commission, and any
request on the part of the Commission for additional information has been
complied with.
At the respective times the Registration Statement, any Rule 462(b)
Registration Statement and any post-effective amendments thereto became
effective and at the Closing Time (and, if any International Option
Securities are purchased, at the Date of Delivery), the Registration
Statement, the Rule 462(b) Registration Statement and any amendments and
supplements thereto complied and will comply in all material respects
with the requirements of the 1933 Act and the 1933 Act Regulations and
did not and will not contain an untrue statement of a material fact or
omit to state a material fact required to be stated therein or
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necessary to make the statements therein not misleading. Neither the
Prospectuses nor any amendments or supplements thereto, at the time the
Prospectuses or any amendments or supplements thereto were issued and at
the Closing Time (and, if any International Option Securities are
purchased, at the Date of Delivery), included or will include an untrue
statement of a material fact or omitted or will 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. If Rule
434 is used, the Company will comply with the requirements of Rule 434.
The representations and warranties in this subsection shall not apply to
statements in or omissions from the Registration Statement or the
International Prospectus made in reliance upon and in conformity with
information furnished to the Company in writing by any Underwriter
expressly for use in the Registration Statement or the International
Prospectus.
Each preliminary prospectus and the prospectuses filed as part of
the Registration Statement as originally filed or as part of any
amendment thereto, or filed pursuant to Rule 424 under the 1933 Act,
complied when so filed in all material respects with the 1933 Act
Regulations and each preliminary prospectus and the Prospectuses
delivered to the Underwriters for use in connection with this offering
was identical to the electronically transmitted copies thereof filed with
the Commission pursuant to ▇▇▇▇▇, except to the extent permitted by
Regulation S-T.
(ii) Incorporated Documents. The documents incorporated or deemed
to be incorporated by reference in the Registration Statement and the
Prospectuses, at the time they were or hereafter are filed with the
Commission, complied and will comply in all material respects with the
requirements of the 1934 Act and the rules and regulations of the
Commission thereunder (the "1934 Act Regulations"), and, when read
together with the other information in the Prospectuses, at the time the
Registration Statement became effective, at the time the Prospectuses
were issued and at the Closing Time (and, if any International Option
Securities are purchased, at the Date of Delivery), did not and will not
contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading.
(iii) Independent Accountants. The accountants who certified the
financial statements and supporting schedules included in the
Registration Statement are independent public accountants as required by
the 1933 Act and the 1933 Act Regulations.
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(iv) Financial Statements. The audited consolidated financial
statements and schedules of each of the Company and Lemmerz Holding GmbH
("Lemmerz") included in the Registration Statement and the Prospectuses
present fairly the consolidated financial position, results of operations
and cash flows of the Company and Lemmerz, respectively, at the dates and
for the periods to which they relate and have been prepared in accordance
with generally accepted accounting principles ("GAAP") applied on a
consistent basis, except as otherwise stated therein; the unaudited
consolidated financial statements and the related notes of the Company
and Lemmerz included in the Registration Statement and the Prospectuses
present fairly the consolidated financial position, results of operations
and cash flows of the Company and Lemmerz, respectively, at the dates and
for the periods to which they relate, subject to year-end audit
adjustments, and have been prepared in accordance with generally accepted
accounting principles applied on a consistent basis except as otherwise
stated therein and have been prepared on a basis substantially consistent
with that of the audited financial statements referred to above except as
otherwise stated therein; to the best knowledge of the Company, after due
inquiry, the summary and selected financial and statistical data included
in the Registration Statement and the Prospectuses present fairly the
information shown therein and have been prepared and compiled on a basis
consistent with the audited and unaudited financial statements included
therein, except as otherwise stated therein.
The pro forma financial statements and other pro forma financial
information (including the notes thereto) included in the Registration
Statement and the Prospectuses (A) have been prepared in accordance with
applicable requirements of Rule 11-02 of Regulation S-X promulgated under
the 1933 Act and (B) have been properly computed on the bases described
therein; the assumptions used in the preparation of the pro forma
financial statements and other pro forma financial information included
in the Registration Statement and the Prospectuses are reasonable and the
adjustments used therein are appropriate to give effect to the
transactions or circumstances referred to therein.
(v) No Material Adverse Change in Business. Subsequent to the
respective dates as of which information is given in the Registration
Statement and the Prospectuses and except as described therein, (A) the
Company and its Subsidiaries (as hereinafter defined),taken as a whole,
have not incurred any material liabilities or obligations, direct or
contingent, or entered into any material transactions, in either case
whether or not in the ordinary
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course of business, and (B) the Company and the Subsidiaries have not
purchased any of their respective outstanding capital stock, or declared,
paid or otherwise made any dividend or distribution of any kind on any of
their respective capital stock or otherwise.
(vi) Good Standing of the Company and the Subsidiaries. The Company
and each of the Subsidiaries that is a corporation organized under the
laws of a jurisdiction of the United States has been duly incorporated
and the Company and each Subsidiary that is a corporation organized under
the laws of a jurisdiction of the United States is validly existing in
good standing as a corporation under the laws of its jurisdiction of
incorporation, with the requisite corporate power and authority to own
its properties and conduct its business as now conducted as described in
the Prospectuses, and is duly qualified to do business as a foreign
corporation in good standing in all other jurisdictions where the
ownership or leasing of its properties or the conduct of its business
requires such qualification, except where the failure to be so qualified
would not, individually or in the aggregate, have a material adverse
effect on the business, condition (financial or other) or results of
operations of the Company and the Subsidiaries, taken as a whole (any
such event a "Material Adverse Effect"); the Company and each of the
Subsidiaries that is not a corporation organized under the laws of a
jurisdiction of the United States has been duly organized and is validly
existing under the laws of the jurisdiction in which it is so organized,
with the requisite power and authority to own its properties and conduct
its business as now conducted and as described in the Prospectuses;
except as set forth in Schedule D hereto (collectively, the
"Subsidiaries"), the Company does not have any subsidiaries or own
directly or indirectly any of the capital stock or other equity
securities of any other person; all of the outstanding shares of capital
stock of the Subsidiaries have been duly authorized and validly issued,
are fully paid and non-assessable and were not issued in violation of any
preemptive or similar rights and, except pursuant to the Amended and
Restated Credit Agreement, dated as of June 30, 1997 (the "Credit
Agreement"), among the Company, Canadian Imperial Bank of Commerce,
▇▇▇▇▇▇▇ ▇▇▇▇▇ Capital Corporation, Dresdner Bank AG and the several
lenders thereunder, are owned free and clear of all liens, encumbrances,
equities and restrictions on transferability (other than those imposed by
the 1933 Act and the state securities or "Blue Sky" laws); except as set
forth in the Prospectuses, no options, warrants or other rights to
purchase from the Company or any Subsidiary, agreements or other
obligations of the Company or any Subsidiary or other rights to convert
any obligation into, or exchange
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any securities for, shares of capital stock of or ownership interests in
any Subsidiary, are outstanding.
(vii) Capitalization. The Company had, as of the date specified
therein, the authorized, issued and outstanding capital stock of the
Company set forth in the Prospectuses in the column entitled "Actual"
under the caption "Capitalization." The shares of issued and outstanding
capital stock, including the Securities to be purchased by the
Underwriters from the Selling Shareholders, have been duly authorized and
validly issued and are fully paid and non-assessable; none of the
outstanding shares of capital stock of the Company, including the
Securities to be purchased by the Underwriters from the Selling
Shareholders, was issued in violation of the preemptive or other similar
rights of any securityholder of the Company; except as set forth in the
Prospectuses, no options, warrants or other rights to purchase from the
Company, agreements or other obligations of the Company, or other rights
to convert any obligation into, or exchange any securities for, shares of
capital stock in the Company are outstanding.
(viii) Authorization of Agreement. The Company has the requisite
corporate power and authority to execute, deliver and perform its
obligations under this Agreement. This Agreement has been duly
authorized, executed and delivered by the Company.
(ix) Authorization and Description of Securities. The Securities to
be purchased by the International Underwriters and the U.S. Underwriters
from the Company have been duly authorized for issuance and sale to the
International Managers pursuant to this Agreement and the U.S.
Underwriters pursuant to the U.S. Purchase Agreement, respectively, and,
when issued and delivered by the Company pursuant to this Agreement and
the U.S. Purchase Agreement, respectively, against payment of the
consideration set forth herein and in the U.S. Purchase Agreement,
respectively, will be validly issued, fully paid and non-assessable; the
Common Stock conforms to all statements relating thereto contained in the
Prospectuses and such description conforms to the rights set forth in the
instruments defining the same; no holder of the Securities will be
subject to personal liability by reason of being such a holder; and the
issuance of the Securities is not subject to the preemptive or other
similar rights of any securityholder of the Company.
(x) Absence of Defaults and Conflicts. None of the Company or the
Subsidiaries is (i) in violation of its certificate of incorporation or
bylaws, (ii) in violation of any statute, judgment, decree, order, rule
or regula-
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tion applicable to it or any of its properties or assets, which violation
would, individually or in the aggregate, have a Material Adverse Effect,
or (iii) in default in the performance or observance of any obligation,
agreement, covenant or condition contained in any contract, indenture,
mortgage, deed of trust, loan agreement, note, lease, license, franchise
agreement, permit, certificate or agreement or instrument to which it is
a party or to which it is subject, which default would, individually or
in the aggregate, have a Material Adverse Effect; the execution, delivery
and performance by the Company of the Purchase Agreements and the
consummation by the Company of the transactions contemplated hereby and
thereby and the fulfillment of the terms hereof and thereof, will not
violate, conflict with or constitute or result in a breach of or a
default under (or an event that, with notice or lapse of time, or both,
would constitute a breach of or a default under) any of (a) the terms or
provisions of any indenture, mortgage, deed of trust, loan agreement,
note, lease, license, franchise agreement, or agreement or instrument to
which the Company or any the Subsidiaries is a party or to which any of
their respective properties or assets are subject, which violation,
conflict, breach or default would, individually or in the aggregate, have
a Material Adverse Effect, (b) the certificate of incorporation or bylaws
of the Company or any of the Subsidiaries or (c) (assuming compliance
with all applicable state securities and "Blue Sky" laws) any statute,
judgment, decree, order, rule or regulation of any court or governmental
agency or other body applicable to the Company or the Subsidiaries or any
of their respective properties or assets, which violation, conflict,
breach or default would, individually or in the aggregate, have a
Material Adverse Effect.
(xi) Certain Tax Matters. The Company and each of the Subsidiaries
has filed all necessary federal, state and foreign income and franchise
tax returns, except where the failure to so file such returns would not,
individually or in the aggregate, have a Material Adverse Effect; and,
other than taxes due thereon or tax deficiencies which the Company or any
Subsidiary reasonably believe that it has provided adequate reserves, has
paid all taxes due thereon and there is no tax deficiency that has been
asserted against the Company or any Subsidiary that would, individually
or in the aggregate, have a Material Adverse Effect.
(xii) Absence of Proceedings. Except as described in the
Prospectuses, there is not pending or, to the best knowledge of the
Company, threatened any action, suit, proceeding, inquiry or
investigation, governmental or oth-
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erwise, to which the Company or any of the Subsidiaries is a party, or to
which their respective properties or assets are subject, before or
brought by any court, arbitrator or governmental agency or body, that, if
determined adversely to the Company or the Subsidiaries, would,
individually or in the aggregate, have a Material Adverse Effect or that
seeks to restrain, enjoin, prevent the consummation of or otherwise
challenge the issuance or sale by the Company of the Securities to be
sold hereunder or the consummation by the Company of the transactions
described in the Prospectuses under the caption "Use of Proceeds."
(xiii) Accuracy of Exhibits. There are no contracts or documents
which are required to be described in the Registration Statement, the
Prospectuses or the documents incorporated by reference therein or to be
filed as exhibits thereto which have not been so described and filed as
required.
(xiv) Possession of Intellectual Property. The Company and the
Subsidiaries possess adequate licenses or other rights to use all
patents, trademarks, service marks, trade names, copyrights and know-how
that are necessary to conduct their business as described in the
Prospectuses; except as set forth in the Prospectuses, none of the
Company or the Subsidiaries has received any notice of infringement of or
conflict with (or knows of any such infringement of or conflict with)
asserted rights of others with respect to any patents, trademarks,
service marks, trade names, copyrights or know-how that, if such
assertion of infringement or conflict were sustained, would, individually
or in the aggregate, have a Material Adverse Effect.
(xv) Absence of Further Requirements. Except as set forth in the
Prospectuses, no consent, approval, authorization or order of any court
or governmental agency or body is required for the performance of the
Purchase Agreements by the Company or for the consummation by the Company
of any of the transactions contemplated hereby and thereby, except for
(i) such consents, approvals, authorizations or orders as have been
obtained or made under the 1933 Act or the 1933 Act Regulations or as may
be required under state securities or "Blue Sky" laws in connection with
the purchase and distribution of the Securities by the Underwriters and
(ii) such other consents, approvals, authorizations or orders, including,
without limitation, such as may be required for the quotation of the
Securities on the Nasdaq National Market, all of which have been obtained
or made or will have been obtained or made at or prior to the Closing
Time with respect to the Initial Se-
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16
curities and at or prior to the relevant Date of Delivery with respect to
the Option Securities.
(xvi) Possession of Licenses and Permits. The Company and each of
the Subsidiaries has obtained all licenses, permits, franchises and other
governmental authorizations, the lack of which would, individually or in
the aggregate, have a Material Adverse Effect.
(xvii) Title to Property. The Company and each of the Subsidiaries
has good and marketable title to all real property described in the
Prospectuses as being owned by it and good and marketable title to the
leasehold estate in the real property described therein as being leased
by it, free and clear of all liens, charges, encumbrances or
restrictions, except, in each case, pursuant to the Credit Agreement, as
described in the Prospectuses or such as would not, individually or in
the aggregate, have a Material Adverse Effect.
(xviii) Investment Company Act. None of the Company or the
Subsidiaries is required to register as an "investment company" or a
company "controlled by" an "investment company" within the meaning of the
Investment Company Act of 1940, as amended.
(xix) Environmental Laws. Except as disclosed in the Prospectuses
and except as would not, individually or in the aggregate, have a
Material Adverse Effect, (A) the Company and each of the Subsidiaries is
in compliance with all applicable Environmental Laws, (B) the Company and
each of the Subsidiaries has made all filings and provided all notices
required under any applicable Environmental Laws, and has all permits,
authorizations and approvals required under any applicable Environmental
Laws and is in compliance with their requirements, (C) there are no
pending or, to the best knowledge of the Company, after due inquiry,
threatened Environmental Claims against the Company or any of the
Subsidiaries and (D) none of the Company or the Subsidiaries has
knowledge of any circumstances with respect to any of their respective
properties or operations that could reasonably be anticipated to form the
basis of an Environmental Claim against any of them or any of their
subsidiaries or any of their respective properties or operations and the
business operations relating thereto which Environmental Claims would,
individually or in the aggregate, have a Material Adverse Effect.
For purposes of this Agreement, the following terms shall have the
following meanings: "Environmental Law" means any federal, state, local
or municipal statute, law, regulation, ordinance, code or rule and any
judicial or admin-
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17
istrative interpretation thereof, including any judicial or
administrative order, consent decree or judgment binding on the Company
or any of the Subsidiaries relating to pollution or protection of the
environment or health or safety or any chemical, material or substance
that is subject to regulation thereunder. "Environmental Claims" means
any and all administrative, regulatory or judicial actions, suits,
demands, demand letters, claims, written notices of responsibility,
information requests, liens, written notices of noncompliance or
violation, investigations or proceedings relating in any way to any
Environmental Law.
(xx) Compliance with Regulation M. None of the Company or the
Subsidiaries or any of their directors, officers or controlling persons,
has taken, directly or indirectly, any action designed, or that might
reasonably be expected, to cause or result, under the 1933 Act or
otherwise, in, or that has constituted, stabilization or manipulation of
the price of any security of any Company to facilitate the sale or resale
of the Securities (it being understood that no representation or warranty
is made as to any actions by the Underwriters) in violation of Regulation
M promulgated under the 1933 Act.
(b) REPRESENTATIONS AND WARRANTIES BY THE SELLING SHAREHOLDERS. Each
Selling Shareholder represents and warrants, severally and not jointly, to each
International Manager as of the date hereof and as of the Closing Time, and
agrees with each International Manager, as follows:
(i) Accurate Disclosure. Such Selling Shareholder has reviewed and
is familiar with the Registration Statement and the Prospectuses and none
of the Prospectuses nor any amendments or supplements thereto include 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. The
representations and warranties in this subsection shall apply only to
statements in or omissions from the Registration Statement or the
Prospectuses made in reliance upon and in conformity with information
furnished to the Company in writing by such Selling Shareholder expressly
for use in the Registration Statements or the Prospectuses.
(ii) Authorization of Agreements. Such Selling Shareholder has the
full legal capacity to enter into the Purchase Agreements, a Power of
Attorney (the "Power of Attorney") and, if applicable, a Custody
Agreement (the "Custody Agreement") and to sell, transfer and deliver the
Securities to be sold by such Selling Shareholder
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18
hereunder. The execution and delivery of the Purchase Agreements, the
Power of Attorney and, if applicable, the Custody Agreement and the sale
and delivery of the Securities to be sold by such Selling Shareholder and
the consummation of the transactions contemplated herein and compliance
by such Selling Shareholder with its obligations hereunder will not,
whether with or without the giving of notice or passage of time or both,
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
the Securities to be sold by such Selling Shareholder pursuant to, any
contract, indenture, mortgage, deed of trust, loan or credit agreement,
note, license, lease or other agreement or instrument to which such
Selling Shareholder is a party or by which such Selling Shareholder may
be bound, or to which any of the property or assets of such Selling
Shareholder is subject, nor will such action result in any violation of
any applicable treaty, law, statute, rule, regulation, judgment, order,
writ or decree of any government, government instrumentality or court,
domestic or foreign, having jurisdiction over such Selling Shareholder or
any of its properties or assets.
(iii) Good and Marketable Title. Such Selling Shareholder has, and
will at the Closing Time have, good and marketable title to the
Securities to be sold by such Selling Shareholder under the Purchase
Agreements, free and clear of any security interest, mortgage, pledge,
lien, charge, claim, equity or encumbrance of any kind, other than
pursuant to the Purchase Agreements and, with respect to each of ▇▇▇▇▇▇
▇▇▇▇▇-▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇-▇▇▇▇▇▇, the Option Agreement, dated as of
July 30, 1997 (the "Option Agreement"), among the Company and each such
Selling Shareholder; and upon delivery of such Securities and payment of
the purchase price therefor as contemplated in the Purchase Agreements,
each of the Underwriters will receive good and marketable title to the
Securities purchased by it from such Selling Shareholder, free and clear
of any security interest, mortgage, pledge, lien, charge, claim, equity
or encumbrance of any kind.
(iv) Due Execution of Power of Attorney and Custody Agreement. Such
Selling Shareholder has duly executed and delivered, in the form
heretofore furnished to the Underwriters, the Power of Attorney with
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, each as attorney-in-fact (each
an "Attorney-in-Fact") and, if applicable, the Custody Agreement with the
Company, as custodian (the "Custodian"); if such Selling Shareholder has
executed the Custody Agreement, the Custodian is authorized to deliver
the Securities to be sold by such Selling Shareholder hereunder and to
ac-
-13-
19
cept payment therefor; each Attorney-in-Fact is authorized to execute and
deliver this Agreement and the certificate referred to in Section 5(f) on
behalf of such Selling Shareholder, to sell, assign and transfer to the
International Managers and the U.S. Underwriters the Securities to be
sold by such Selling Shareholder hereunder and under the U.S. Purchase
Agreement, to determine the purchase price to be paid by the Underwriters
to such Selling Shareholder, as provided in Section 2(c) hereof and of
the U.S. Purchase Agreement, to authorize the delivery of the Securities
to be sold by such Selling Shareholder hereunder and under the U.S.
Purchase Agreement, to accept payment therefor and, in the case of ▇▇.
▇▇▇▇▇, to exercise his options in order to sell the Securities to be sold
by him pursuant to the Purchase Agreements and otherwise to act on behalf
of the Selling Shareholder in connection with this Agreement and the U.S.
Purchase Agreement.
(v) Absence of Manipulation. Such Selling Shareholder has not
taken, and will not take, directly or indirectly, any action which is
designed to or which has constituted or which might reasonably be
expected to cause or result in stabilization or manipulation of the price
of any security of the Company to facilitate the sale or resale of the
Securities.
(vi) Absence of Further Requirements. No filing with, or consent,
approval, authorization, order, registration, qualification or decree of,
any court or governmental authority or agency, domestic or foreign, is
necessary or required for the performance by such Selling Shareholder of
its obligations under the Purchase Agreements, in the Power of Attorney
or, if applicable, the Custody Agreement, or in connection with the sale
and delivery by such Selling Shareholder of the Securities under the
Purchase Agreements or the consummation by such Selling Shareholder of
the transactions contemplated by the Purchase Agreements, except for (i)
such as may have previously been made or obtained under the 1933 Act or
the 1933 Act Regulations or as may be required under state securities or
"Blue Sky" laws in connection with the purchase and sale of the
Securities by the Underwriters and (ii) such others as may be required,
all of which have been obtained or made or will have been obtained or
made at or prior to the Closing Time.
(vii) Certificates Suitable for Transfer. In the case of ▇▇▇▇
▇▇▇▇▇▇-▇▇▇▇▇▇ and ▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇▇▇▇ only, certificates for all of the
Securities to be sold by such Selling Shareholder pursuant to the
Purchase Agreements, in suitable form for transfer by delivery or
accompanied
-14-
20
by duly executed instruments of transfer or assignment in blank with
signatures guaranteed, have been placed in custody with the Custodian
with irrevocable conditional instructions to deliver such Securities to
the Underwriters pursuant to the Purchase Agreements.
(viii) No Association with NASD. Neither such Selling Shareholder
nor any of his or her affiliates directly, or indirectly through one or
more intermediaries, controls, or is controlled by, or is under common
control with, or has any other association with (within the meaning of
Article I, Section 1(a) of the By-laws of the National Association of
Securities Dealers, Inc.), any member firm of the National Association of
Securities Dealers, Inc.
(c) OFFICER'S CERTIFICATES. Any certificate signed by any
officer of the Company delivered to the International Managers or to counsel
for the International Managers shall be deemed a representation and warranty by
the Company to each International Manager as to the matters covered thereby;
and any certificate signed by or on behalf of any Selling Shareholder as such
and delivered to the International Managers or to counsel for the International
Managers pursuant to the terms of this Agreement shall be deemed a
representation and warranty by such Selling Shareholder to each International
Manager as to the matters covered thereby.
SECTION 2. Sale and Delivery to
International Managers; Closing
(a) INITIAL SECURITIES. On the basis of the representations and
warranties herein contained and subject to the terms and conditions herein set
forth, the Company and each Selling Shareholder, severally and not jointly,
agree to sell to each International Manager, severally and not jointly, and
each International Manager, severally and not jointly, agrees to purchase from
the Company and each Selling Shareholder, at the price per share set forth in
Schedule C, that proportion of the number of Initial International Securities
set forth in Schedule B opposite the name of the Company or each Selling
Shareholder, as the case may be, which the number of Initial International
Securities set forth in Schedule A opposite the name of such International
Manager, plus any additional number of Initial International Securities which
such International Manager may elect to purchase pursuant to the provisions of
Section 10 hereof, bears to the total number of Initial International
Securities, subject, in each case, to such adjustments among the International
Managers as the Global Coordinator in its sole discretion shall make to
eliminate any sales or purchases of fractional securities.
-15-
21
(b) OPTION SECURITIES. In addition, on the basis of the representations
and warranties herein contained and subject to the terms and conditions herein
set forth, the Company hereby grants an option to the International Managers,
severally and not jointly, to purchase up to an additional 116,925 shares of
Common Stock, as set forth in Schedule B, at the price per share set forth in
Schedule C, less an amount per share equal to any dividends or distributions
declared by the Company and payable on the Initial International Securities but
not payable on the International Option Securities. The option hereby granted
will expire 30 days after the date hereof and may be exercised in whole or in
part from time to time only for the purpose of covering over-allotments which
may be made in connection with the offering and distribution of the Initial
International Securities upon notice by the Global Coordinator to the Company
setting forth the number of International Option Securities as to which the
several International Managers are then exercising the option and the time and
date of payment and delivery for such International Option Securities. Any
such time and date of delivery for the International Option Securities (a "Date
of Delivery") shall be determined by the Global Coordinator, but shall not be
later than seven full business days after the exercise of said option, nor in
any event prior to the Closing Time, as hereinafter defined. If the option is
exercised as to all or any portion of the International Option Securities, each
of the International Managers, acting severally and not jointly, will purchase
that proportion of the total number of International Option Securities then
being purchased which the number of Initial International Securities set forth
in Schedule A opposite the name of such International Manager bears to the
total number of Initial International Securities, subject in each case to such
adjustments as the Global Coordinator in its discretion shall make to eliminate
any sales or purchases of fractional shares.
(c) PAYMENT. Payment of the purchase price for, and delivery of
certificates for, the Initial Securities shall be made at the offices of ▇▇▇▇▇▇
▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇.▇. ▇▇▇▇▇ or at such other place
as shall be agreed upon by the Global Coordinator and the Company, at 9:00 A.M.
(Eastern time) on the third (fourth, if the pricing occurs after 4:30 P.M.
(Eastern time) on any given day) business day after the date hereof (unless
postponed in accordance with the provisions of Section 10), or such other time
not later than ten business days after such date as shall be agreed upon by the
Global Coordinator and the Company (such time and date of payment and delivery
being herein called "Closing Time").
In addition, in the event that any or all of the International Option
Securities are purchased by the International Managers, payment of the purchase
price for, and delivery of certificates for, such International Option
Securities
-16-
22
shall be made at the above-mentioned offices, or at such other place as
shall be agreed upon by the Global Coordinator and the Company, on each Date of
Delivery as specified in the notice from the Global Coordinator to the Company.
Payment shall be made to the Company and each Selling Shareholder by
wire transfer of immediately available funds to bank accounts designated by
the Company and each Selling Shareholder, as the case may be, against delivery
to the International Managers for their respective accounts of certificates for
the International Securities to be purchased by them. Payment in respect of
the Securities shall be made in United States dollars. ▇▇▇▇▇▇▇ ▇▇▇▇▇,
individually and not as representative of the International Managers, may (but
shall not be obligated to) make payment of the purchase price for the Initial
International Securities or the International Option Securities, if any, to be
purchased by any International Manager whose funds have not been received by
the Closing Time or the relevant Date of Delivery, as the case may be, but such
payment shall not relieve such International Managers from its obligations
hereunder.
(d) DENOMINATIONS; REGISTRATION. Certificates for the Initial
International Securities and the International Option Securities, if any, shall
be in such denominations and registered in such names as the International
Managers may request in writing at least one full business day before the
Closing Time or the relevant Date of Delivery, as the case may be. The
certificates for the Initial International Securities and the International
Option Securities, if any, will be made available for examination and packaging
by the International Managers in The City of New York not later than 10:00 A.M.
(Eastern time) on the business day prior to the Closing Time or the relevant
Date of Delivery, as the case may be.
SECTION 3. Covenants of the Company. The Company covenants with each
International Manager as follows:
(a) COMPLIANCE WITH SECURITIES REGULATIONS AND COMMISSION REQUESTS.
The Company, subject to Section 3(b), will comply with the requirements
of Rule 430A or Rule 434, as applicable, and will notify the Global
Coordinator immediately, and confirm the notice in writing, (i) when any
post-effective amendment to the Registration Statement shall become
effective, or any supplement to the Prospectuses or any amended
Prospectuses shall have been filed, (ii) of the receipt of any comments
from the Commission, (iii) of any request by the Commission for any
amendment to the Registration Statement or any amendment or supplement to
the Prospectuses or for additional information, and (iv) of the issuance
by the Commission of any stop order suspending the effectiveness of the
Registration
-17-
23
Statement or of any order preventing or suspending the use of any
preliminary prospectus, or of the suspension of the qualification of the
Securities for offering or sale in any jurisdiction, or of the initiation
or threatening of any proceedings for any of such purposes. The Company
will promptly effect the filings necessary pursuant to Rule 424(b) and
will take such steps as it deems necessary to ascertain promptly whether
the form of prospectus transmitted for filing under Rule 424(b) was
received for filing by the Commission and, in the event that it was not,
it will promptly file such prospectus. The Company will make every
reasonable effort to prevent the issuance of any stop order and, if any
stop order is issued, to obtain the lifting thereof at the earliest
possible moment.
(b) FILING OF AMENDMENTS. The Company will give the Global
Coordinator notice of its intention to file or prepare any amendment to
the Registration Statement (including any filing under Rule 462(b)), any
Term Sheet or any amendment, supplement or revision to either the
prospectus included in the Registration Statement at the time it became
effective or to the Prospectuses, whether pursuant to the 1933 Act, the
1934 Act or otherwise, will furnish the Global Coordinator with copies of
any such documents a reasonable amount of time prior to such proposed
filing or use, as the case may be, and will not file or use any such
document to which the Global Coordinator or counsel for the International
Managers shall object.
(c) DELIVERY OF REGISTRATION STATEMENTS. The Company has furnished
or will deliver to the International Managers and counsel for the
International Managers, without charge, signed copies of the Registration
Statement as originally filed and of each amendment thereto (including
exhibits filed therewith or incorporated by reference therein and
documents incorporated or deemed to be incorporated by reference therein)
and signed copies of all consents and certificates of experts. The
copies of the Registration Statement and each amendment thereto furnished
to the International Managers will be identical to the electronically
transmitted copies thereof filed with the Commission pursuant to ▇▇▇▇▇,
except to the extent permitted by Regulation S-T.
(d) DELIVERY OF PROSPECTUSES. The Company has delivered to each
International Manager, without charge, as many copies of each preliminary
prospectus as such International Manager reasonably requested, and the
Company hereby consents to the use of such copies for purposes permitted
by the 1933 Act. The Company will furnish to each International Manager,
without charge, during the period when the International Prospectus is
required to be
-18-
24
delivered under the 1933 Act or the 1934 Act, such number of copies of
the International Prospectus (as amended or supplemented) as such
International Manager may reasonably request. The International
Prospectus and any amendments or supplements thereto furnished to the
International Managers will be identical to the electronically
transmitted copies thereof filed with the Commission pursuant to ▇▇▇▇▇,
except to the extent permitted by Regulation S-T.
(e) CONTINUED COMPLIANCE WITH SECURITIES LAWS. The Company will
comply with the 1933 Act and the 1933 Act Regulations and the 1934 Act
and the 1934 Act Regulations so as to permit the completion of the
distribution of the Securities as contemplated in this Agreement, the
U.S. Purchase Agreement and in the Prospectuses. If at any time when a
prospectus is required by the 1933 Act to be delivered in connection
with sales of the Securities, any event shall occur or condition shall
exist as a result of which it is necessary, in the opinion of counsel for
the International Managers or for the Company, to amend the Registration
Statement or amend or supplement any Prospectus in order that the
Prospectuses will not include any untrue statements of a material fact or
omit to state a material fact necessary in order to make the statements
therein not misleading in the light of the circumstances existing at the
time it is delivered to a purchaser, or if it shall be necessary, in the
opinion of such counsel, at any such time to amend the Registration
Statement or amend or supplement any Prospectus in order to comply with
the requirements of the 1933 Act or the 1933 Act Regulations, the Company
will promptly prepare and file with the Commission, subject to Section
3(b), such amendment or supplement as may be necessary to correct such
statement or omission or to make the Registration Statement or the
Prospectuses comply with such requirements, and the Company will furnish
to the International Managers such number of copies of such amendment or
supplement as the International Managers may reasonably request.
(f) BLUE SKY QUALIFICATIONS. The Company will cooperate with the
Underwriters in arranging for the qualification of the Securities for
offering and sale under the securities or "Blue Sky" laws of such
jurisdictions as the Underwriters may designate and will continue such
qualifications in effect for as long as may be necessary to complete the
distribution of the Securities by the Underwriters; provided, however,
that in connection therewith the Company shall not be required to qualify
as a foreign corporation or dealer in any jurisdiction in which it is not
so qualified, to file any general consent to service of process in any
jurisdiction or to take any other action that would subject it to service
of process or to taxation
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25
in respect to doing business in any jurisdiction in which it is not
otherwise subject.
(g) RULE 158. The Company will timely file such reports pursuant to
the 1934 Act as are necessary in order to make generally available to its
securityholders as soon as practicable an earnings statement for the
purposes of, and to provide the benefits contemplated by, the last
paragraph of Section 11(a) of the 1933 Act.
(h) USE OF PROCEEDS. The Company will use the net proceeds received
by it from the sale of the Securities in the manner specified in the
Prospectuses under "Use of Proceeds".
(i) LISTING. The Company will use its best efforts to effect and
maintain the quotation of the Securities on the Nasdaq National Market
and will file with the Nasdaq National Market all documents and notices
required by the Nasdaq National Market of companies that have securities
that are traded in the over-the-counter market and quotations for which
are reported by the Nasdaq National Market.
(j) RESTRICTION ON SALE OF SECURITIES. During the period from the
date of the Prospectuses to the date which is 120 days thereafter, the
Company will not, without the prior written consent of the Global
Coordinator, directly or indirectly, sell, offer to sell, grant any
option for the sale of or otherwise dispose of, any shares of Common
Stock or any securities convertible into or exercisable or exchangeable
for Common Stock. The foregoing sentence shall not apply to (A) the
Securities to be sold hereunder, (B) the purchase of shares of Common
Stock pursuant to the Option Agreement, (C) any shares of Common Stock
issued by the Company upon the exercise of any option under the 1992 Plan
or the 1996 Plan (as defined in the Prospectuses), or (D) any shares of
Common Stock issued upon conversion of the shares of the Company's Class
A Preferred Stock outstanding on the date hereof.
(k) REPORTING REQUIREMENTS. The Company, during the period when the
Prospectuses are required to be delivered under the 1933 Act or the 1934
Act, will file all documents required to be filed with the Commission
pursuant to the 1934 Act within the time periods required by the 1934 Act
and the 1934 Act Regulations.
SECTION 4. Payment of Expenses. (a) EXPENSES. The Company will
pay or cause to be paid all expenses incident to the performance of its
obligations under this Agreement, in-
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26
cluding (i) the preparation, printing and filing of the Registration Statement
(including financial statements and exhibits) as originally filed and of each
amendment thereto, (ii) the preparation, printing and delivery to the
Underwriters of this Agreement, any Agreement Among Underwriters and such other
documents as may be required in connection with the offering, purchase, sale,
issuance or delivery of the Securities, (iii) the preparation, issuance and
delivery of the certificates for the Securities to the Underwriters, including
any stock or other transfer taxes and any stamp or other duties payable upon
the sale, issuance or delivery of the Securities to the Underwriters and the
transfer of the Securities between the U.S. Underwriters and the International
Managers, (iv) the fees and disbursements of the Company's counsel, accountants
and other advisors, (v) the qualification of the Securities under securities
laws in accordance with the provisions of Section 3(f) hereof, including filing
fees and the reasonable fees and disbursements of counsel for the Underwriters
in connection therewith and in connection with the preparation of the Blue Sky
Survey and any supplement thereto, (vi) the printing and delivery to the
Underwriters of copies of each preliminary prospectus, any Term Sheets and of
the Prospectuses and any amendments or supplements thereto, (vii) the
preparation, printing and delivery to the Underwriters of copies of the Blue
Sky Survey and any supplement thereto, (viii) the fees and expenses of any
transfer agent or registrar for the Securities, (ix) the filing fees incident
to, and the reasonable fees and disbursements of counsel to the Underwriters in
connection with, the review by the National Association of Securities Dealers,
Inc. (the "NASD") of the terms of the sale of the Securities and (x) the fees
and expenses incurred in connection with the inclusion of the Securities in the
Nasdaq National Market.
(b) EXPENSES OF THE SELLING SHAREHOLDERS. Each Selling Shareholder will
pay all expenses incident to the performance of its obligations under, and the
consummation of the transactions contemplated by, this Agreement (other than
any stamp duties, capital duties and stock transfer taxes, if any, payable upon
the sale of the Securities to the International Managers) including the fees
and disbursements of its counsel and accountants.
(c) TERMINATION OF AGREEMENT. If this Agreement is terminated by the
International Managers in accordance with the provisions of Section 5, Section
9(a)(i) or Section 11 hereof, the Company and, in the event that such
termination results from any act or omission of one or more Selling
Shareholders, such Selling Shareholder(s), shall reimburse the International
Managers for all of their out-of-pocket expenses, including the reasonable fees
and disbursements of counsel for the International Managers.
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27
(d) ALLOCATION OF EXPENSES. The provisions of this Section shall not
affect any agreement that the Company and any Selling Shareholder may make
regarding the allocation of such costs and expenses.
SECTION 5. Conditions of International Managers' Obligations. The
obligations of the several International Managers hereunder are subject to the
representations and warranties of the Company and each of the Selling
Shareholders contained in Section 1 hereof which are qualified as to
materiality being true and correct, and those not so qualified being true and
correct in all material respects, the accuracy of the representations and
warranties in certificates of any officer of the Company or any Subsidiary of
the Company or on behalf of each Selling Shareholder delivered pursuant to the
provisions hereof, to the performance in all material respects by the Company
of its covenants and other obligations hereunder, and to the following further
conditions:
(a) EFFECTIVENESS OF REGISTRATION STATEMENT. The Registration
Statement, including any Rule 462(b) Registration Statement, has become
effective and at Closing Time no stop order suspending the effectiveness
of the Registration Statement shall have been issued under the 1933 Act
or proceedings therefor initiated or threatened by the Commission, and
any request on the part of the Commission for additional information
shall have been complied with to the reasonable satisfaction of counsel
to the International Managers. A prospectus containing the Rule 430A
Information shall have been filed with the Commission in accordance with
Rule 424(b) (or a post-effective amendment providing such information
shall have been filed and declared effective in accordance with the
requirements of Rule 430A) or, if the Company has elected to rely upon
Rule 434, a Term Sheet shall have been filed with the Commission in
accordance with Rule 424(b).
(b) OPINION OF COUNSEL FOR COMPANY. At Closing Time, the
International Managers shall have received the favorable opinion, dated
as of Closing Time, of (i) Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇, counsel
for the Company, in form and substance satisfactory to counsel for the
International Managers, to the effect set forth in Exhibit A-1 hereto and
to such further effect as counsel to the International Managers may
reasonably request and (ii) ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, general counsel of the
Company in form and substance satisfactory to counsel for the
International Managers, to the effect set forth in Exhibit A-2 hereto and
to such further effect as counsel to the International Managers may
reasonably request.
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(c) OPINION OF COUNSELS FOR THE SELLING SHAREHOLDERS. At Closing
Time, the International Managers shall have received the favorable
opinion, dated as of Closing Time, of (i) Cleary, Gottlieb, ▇▇▇▇▇ &
▇▇▇▇▇▇▇▇, counsel for ▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇-▇▇▇▇▇▇, and
(ii) Foster, Swift, ▇▇▇▇▇▇▇ & ▇▇▇▇▇, ▇.▇. counsel for ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇,
each in form and substance satisfactory to counsel for the International
Managers, to the effect set forth in Exhibit B hereto and to such further
effect as counsel to the International Managers may reasonably request.
(d) OPINION OF COUNSEL FOR INTERNATIONAL MANAGERS. At Closing Time,
the International Managers shall have received the favorable opinion,
dated as of Closing Time, of ▇▇▇▇▇▇ ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇, counsel for the
International Managers, with respect to the matters set forth in clauses
(i), (ii), (iii), (iv) and (viii) (with respect to clause (viii), solely
as to the information in the Prospectuses under the caption "Description
of Capital Stock-Common Stock") and the last paragraph of Exhibit A-1
hereto. In giving such opinion, such counsel will express no opinion as
to laws of jurisdictions other than the law of the State of New York, the
federal law of the United States and the General Corporation Law of the
State of Delaware. Such counsel may also state that, insofar as such
opinion involves factual matters, they have relied, to the extent they
deem proper, upon certificates of officers of the Company and its
Subsidiaries and certificates of public officials.
(e) OFFICERS' CERTIFICATE. At Closing Time, there shall not have
been, since the date hereof or since the respective dates as of which
information is given in the Prospectuses, any material adverse change in
the business, condition, financial or otherwise, or results of operations
of the Company and its Subsidiaries, taken as a whole, whether or not
arising in the ordinary course of business, and the International
Managers shall have received a certificate of the President or a Vice
President of the Company and of the chief financial or chief accounting
officer of the Company, dated as of Closing Time, to the effect that (i)
there has been no such material adverse change, (ii) the representations
and warranties in Section 1(a) hereof which are qualified as to
materiality are true and correct, and those not so qualified are true and
correct in all material respects with the same force and effect as though
expressly made at and as of Closing Time, (iii) the Company has complied
in all material respects with all agreements and satisfied all conditions
on its part to be performed or satisfied at or prior to Closing Time, and
(iv) no stop order suspending the effective-
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ness of the Registration Statement has been issued and no proceedings for
that purpose have been instituted or are pending or are contemplated by
the Commission.
(f) CERTIFICATE OF SELLING SHAREHOLDERS. At Closing Time, the
International Managers shall have received a certificate of an
Attorney-in-Fact on behalf of each Selling Shareholder, dated as of
Closing Time, to the effect that (i) the representations and warranties
of such Selling Shareholder contained in Section 1(b) hereof are true and
correct with the same force and effect as though expressly made at and as
of Closing Time and (ii) such Selling Shareholder has complied in all
material respects with all agreements and all conditions on its part to
be performed under this Agreement at or prior to Closing Time.
(g) ACCOUNTANT'S COMFORT LETTER. At the time of the execution of
this Agreement, the International Managers shall have received from KPMG
Peat Marwick LLP and KPMG Deutsche Treuhand-Gesellschaft
Aktiengesellschaft Wirtschaftsprufungsgesellschaft (the "Independent
Accountants") letters dated such date, in form and substance satisfactory
to the International Managers, 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 Registration Statement and the
Prospectuses.
(h) BRING-DOWN COMFORT LETTER. At Closing Time, the International
Managers shall have received from the Independent Accountants letters,
dated as of Closing Time, to the effect that they reaffirm the statements
made in the letter furnished pursuant to subsection (g) of this Section,
except that the specified date referred to shall be a date not more than
three business days prior to Closing Time.
(i) APPROVAL OF LISTING. At Closing Time, the Securities shall have
been approved for inclusion in the Nasdaq National Market, subject only
to official notice of issuance.
(j) NO OBJECTION. The NASD has confirmed that it has not raised any
objection with respect to the fairness and reasonableness of the
underwriting terms and arrangements.
(k) LOCK-UP AGREEMENTS. At the date of this Agreement, the
International Managers shall have received an
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agreement substantially in the form of Exhibit C hereto signed by the
persons listed on Schedule E hereto.
(l) PURCHASE OF INITIAL U.S. SECURITIES. Contemporaneously with
the purchase by the International Managers of the Initial International
Securities under this Agreement, the U.S. Underwriters shall have
purchased the Initial U.S. Securities under the U.S. Purchase Agreement.
(m) CONDITIONS TO PURCHASE OF INTERNATIONAL OPTION SECURITIES. In
the event that the International Managers exercise their option provided
in Section 2(b) hereof to purchase all or any portion of the
International Option Securities, the representations and warranties of
the Company contained herein and the statements in any certificates
furnished by the Company hereunder shall be true and correct in all
material respects as of each Date of Delivery and, at the relevant Date
of Delivery, the International Managers shall have received:
(i) Officers' Certificate. A certificate, dated such Date of
Delivery, of the President or a Vice President of the Company and
of the chief financial or chief accounting officer of the Company
confirming that the certificate delivered at the Closing Time
pursuant to Section 5(e) hereof remains true and correct as of such
Date of Delivery.
(ii) Opinion of Counsel for Company. The favorable opinion of
Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP, counsel for the Company,
together with the favorable opinion of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, general
counsel to the Company, each in form and substance satisfactory to
counsel for the International Managers, dated such Date of
Delivery, relating to the International Option Securities to be
purchased on such Date of Delivery and otherwise to the same effect
as the opinion required by Section 5(b) hereof.
(iii) Opinion of Counsel for International Managers. The
favorable opinion of ▇▇▇▇▇▇ ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇, counsel for the
International Managers, dated such Date of Delivery, relating to
the International Option Securities to be purchased on such Date of
Delivery and otherwise to the same effect as the opinion required
by Section 5(d) hereof.
(iv) Bring-down Comfort Letter. A letter from the Independent
Accountants, in form and substance satisfactory to the
International Managers and dated such Date of Delivery,
substantially in the same form and substance as the letter
furnished to the Interna-
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tional Managers pursuant to Section 5(g) hereof, except that the
"specified date" in the letter furnished pursuant to this paragraph
shall be a date not more than five days prior to such Date of
Delivery.
(n) ADDITIONAL DOCUMENTS. At Closing Time and at each Date of
Delivery counsel for the International Managers shall have been furnished
with such additional documents and certificates as they may require for
the purpose of enabling them to pass upon the issuance and sale of the
Securities as herein contemplated, or in order to evidence the accuracy
of any of the representations or warranties, or the fulfillment of any of
the conditions, herein contained; and all proceedings taken by the
Company and each of the Selling Shareholders in connection with the
issuance and sale of the Securities as herein contemplated shall be
satisfactory in form and substance to the International Managers and
counsel for the International Managers.
(o) TERMINATION OF AGREEMENT. If any condition specified in this
Section shall not have been fulfilled when and as required to be
fulfilled, this Agreement, or, in the case of any condition to the
purchase of International Option Securities on a Date of Delivery which
is after the Closing Time, the obligations of the several International
Managers to purchase the relevant International Option Securities, may be
terminated by the International Managers by notice to the Company at any
time at or prior to Closing Time or such Date of Delivery, as the case
may be, and such termination shall be without liability of any party to
any other party except as provided in Section 4 and except that Sections
1, 6, 7 and 8 shall survive any such termination and remain in full
force and effect.
SECTION 6. Indemnification.
(a) INDEMNIFICATION OF INTERNATIONAL MANAGERS. Subject to the
qualifications set forth below, the Company and each Selling Shareholder,
severally and not jointly, agrees to indemnify and hold harmless each
International Manager and each person, if any, who controls any International
Manager within the meaning of Section 15 of the 1933 Act or Section 20 of the
1934 Act as follows:
(i) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, arising out of any untrue statement or alleged
untrue statement of a material fact contained in the Registration
Statement (or any amendment thereto), including the Rule 430A Information
and the Rule 434 Information, if applicable, or the
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omission or alleged omission therefrom of a material fact required to be
stated therein or necessary to make the statements therein not misleading
or arising out of any untrue statement or alleged untrue statement of a
material fact included in any preliminary prospectus or the Prospectuses
(or any amendment or supplement thereto), or the omission or alleged
omission therefrom of a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading;
(ii) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, to the extent of the aggregate amount paid in
settlement of any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or of any claim
whatsoever based upon any such untrue statement or omission, or any such
alleged untrue statement or omission; provided that (subject to Section
6(d) below) any such settlement is effected with the written consent of
the Company and such Selling Shareholder; and
(iii) against any and all expense whatsoever, as incurred (including
the reasonable and documented fees and disbursements of counsel chosen by
▇▇▇▇▇▇▇ ▇▇▇▇▇), reasonably incurred in investigating, preparing or
defending against any litigation, or any investigation or proceeding by
any governmental agency or body, commenced or threatened, or any claim
whatsoever based upon any such untrue statement or omission, or any such
alleged untrue statement or omission, to the extent that any such expense
is not paid under (i) or (ii) above;
provided, however, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Company by any
Underwriter expressly for use in the Registration Statement (or any amendment
thereto), including in the Rule 430A Information and the Rule 434 Information,
if applicable, or in any preliminary prospectus or the Prospectuses (or in any
amendment or supplement thereto); provided, further, that each Selling
Shareholder shall indemnify and hold harmless the International Managers
pursuant to this Section 6(a) only with respect to untrue statements or
omissions or alleged untrue statements or omissions, made in the Registration
Statement (or amendment thereto) or in any preliminary prospectus or the
Prospectuses (or in any amendment or supplement thereto) in reliance upon and
in conformity with written information furnished to the Company by such Selling
Shareholder expressly for use in the Registration Statement (or any amendment
thereto) or in any
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33
preliminary prospectus or the Prospectuses (or in any amendment or supplement
thereto). Notwithstanding the provisions of this Section 6(a), the liability
of a Selling Shareholder to all parties for indemnification under this Section
6(a) (or for breach of the representations and warranties of such Selling
Shareholder set forth in Section 1(b)) shall not exceed in any event the
proceeds (net of underwriting discounts and commissions) from the Securities
sold by such Selling Shareholder to the International Managers pursuant to this
Agreement.
(b) INDEMNIFICATION OF COMPANY, DIRECTORS, OFFICERS AND SELLING
SHAREHOLDERS. Each International Manager severally agrees to indemnify and
hold harmless the Company, its directors, each of its officers who signed the
Registration Statement, and each person, if any, who controls the Company
within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act,
and each Selling Shareholder against any and all loss, liability, claim, damage
and expense described in the indemnity contained in subsection (a) of this
Section, as incurred, but only with respect to untrue statements or omissions,
or alleged untrue statements or omissions, made in the Registration Statement
(or any amendment thereto), including in the Rule 430A Information and the
Rule 434 Information, if applicable, or in any preliminary prospectus or the
Prospectuses (or in any amendment or supplement thereto) in reliance upon and
in conformity with written information furnished to the Company by such
International Manager expressly for use in the Registration Statement (or any
amendment thereto) or in such preliminary prospectus or the Prospectuses (or in
any amendment or supplement thereto).
(c) ACTIONS AGAINST PARTIES; NOTIFICATION. Each indemnified party shall
give notice as promptly as reasonably practicable to each indemnifying party of
any action commenced against it in respect of which indemnity may be sought
hereunder, but failure to so notify an indemnifying party shall not relieve
such indemnifying party from any liability hereunder to the extent it is not
materially prejudiced as a result thereof and in any event shall not relieve it
from any liability which it may have otherwise than on account of this
indemnity agreement. In the case of parties indemnified pursuant to Section
6(a) above, counsel to the indemnified parties shall be selected by ▇▇▇▇▇▇▇
▇▇▇▇▇, and, in the case of parties indemnified pursuant to Section 6(b) above,
counsel to the indemnified parties shall be selected by the Company. An
indemnifying party may participate at its own expense in the defense of any
such action; provided, however, that counsel to the indemnifying party shall
not (except with the consent of the indemnified party) also be counsel to the
indemnified party. In no event shall the indemnifying parties be liable for
fees and expenses of more than one counsel (in addition to any local counsel)
separate from their own counsel for all indemnified
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34
parties in connection with any one action or separate but similar or related
actions in the same jurisdiction arising out of the same general allegations or
circumstances. No indemnifying party shall, without the prior written consent
of the indemnified parties, settle or compromise or consent to the entry of any
judgment with respect to any litigation, or any investigation or proceeding by
any governmental agency or body, commenced or threatened, or any claim
whatsoever in respect of which indemnification or contribution could be sought
under this Section 6 or Section 7 hereof (whether or not the indemnified
parties are actual or potential parties thereto), unless such settlement,
compromise or consent (i) includes an unconditional release (or any other
release reasonably acceptable to the indemnified party) of each indemnified
party from all liability arising out of such litigation, investigation,
proceeding or claim [and (ii) does not include a statement as to or an
admission of fault, culpability or a failure to act by or on behalf of any
indemnified party.]
[(d) SETTLEMENT WITHOUT CONSENT IF FAILURE TO REIMBURSE. If at any time
an indemnified party shall have requested an indemnifying party to reimburse
the indemnified party for fees and expenses of counsel, such indemnifying party
agrees that it shall be liable for any settlement of the nature contemplated by
Section 6(a)(ii) effected without its written consent if (i) such settlement is
entered into more than 45 days after receipt by such indemnifying party of the
aforesaid request, (ii) such indemnifying party shall have received notice of
the terms of such settlement at least 30 days prior to such settlement being
entered into and (iii) such indemnifying party shall not have reimbursed such
indemnified party in accordance with such request prior to the date of such
settlement. Notwithstanding the immediately preceding 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, an indemnifying party
shall not be liable for any settlement of the nature contemplated by Section
6(a)(ii) effected without its consent if such indemnifying party (i) reimburses
such indemnified party in accordance with such request to the extent it
considers such request to be reasonable and (ii) provides written notice to the
indemnified party substantiating the unpaid balance as unreasonable, in each
case prior to the date of such settlement.]
(e) OTHER AGREEMENTS WITH RESPECT TO INDEMNIFICATION. The provisions of
this Section shall not affect any agreement among the Company and any Selling
Shareholder with respect to indemnification.
SECTION 7. Contribution. If the indemnification provided for in Section 6
hereof is for any reason, other than
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as a result of the first proviso to Section 6(a), unavailable to or
insufficient to hold harmless an indemnified party in respect of any losses,
liabilities, claims, damages or expenses referred to therein, then each
indemnifying party shall contribute to the aggregate amount of such losses,
liabilities, claims, damages and expenses incurred by such indemnified party,
as incurred, (i) in such proportion as is appropriate to reflect the relative
benefits received by the Company, by the Selling Shareholders and by the
International Managers from the offering of the International Securities
pursuant to this Agreement or (ii) if the allocation provided by clause (i) is
not permitted by applicable law, in such proportion as is appropriate to
reflect not only the relative benefits referred to in clause (i) above but also
the relative fault of the Company, of the Selling Shareholders and of the
International Managers in connection with the statements or omissions which
resulted in such losses, liabilities, claims, damages or expenses, as well as
any other relevant equitable considerations.
The relative benefits received by the Company, by the Selling Shareholders
and by the International Managers in connection with the offering of the
International Securities pursuant to this Agreement shall be deemed to be in
the same respective proportions as the total net proceeds from the offering of
the International Securities pursuant to this Agreement (before deducting
expenses) received by each of the Company and the Selling Shareholders and the
total underwriting discount received by the International Managers, in each
case as set forth on the cover of the International Prospectus, or, if Rule 434
is used, the corresponding location on the Term Sheet, bear to the aggregate
initial public offering price of the International Securities as set forth on
such cover.
The relative fault of the Company, of the Selling Shareholders and of the
International Managers shall be determined by reference to, among other things,
whether any such untrue or alleged untrue statement of a material fact or
omission or alleged omission to state a material fact relates to information
supplied by the Company, the Selling Shareholders or by the International
Managers and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission.
The Company, each Selling Shareholder and the International Managers agree
that it would not be just and equitable if contribution pursuant to this
Section 7 were determined by pro rata allocation (even if the International
Managers were treated as one entity for such purpose) or by any other method of
allocation which does not take account of the equitable considerations referred
to above in this Section 7. The aggregate amount of losses, liabilities,
claims, damages and expenses incurred by an indemnified party and referred to
above in this
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Section 7 shall be deemed to include any legal or other expenses reasonably
incurred by such indemnified party in investigating, preparing or defending
against any litigation, or any investigation or proceeding by any governmental
agency or body, commenced or threatened, or any claim whatsoever based upon any
such untrue or alleged untrue statement or omission or alleged omission.
Notwithstanding the provisions of this Section 7, no International Manager
shall be required to (i) contribute any amount in excess of the amount by which
the total price at which the International Securities underwritten by it and
distributed to the public were offered to the public exceeds the amount of any
damages which such International Manager has otherwise been required to pay by
reason of any such untrue or alleged untrue statement or omission or alleged
omission or (ii) contribute any amount in excess of their proportionate share
of the aggregate amount of any losses, liabilities, claims, damages and
expenses referred to above which proportionate share shall be deemed to be
equal to the proportion that total underwriting discounts received by such
International Manager bears to the aggregate initial offering price of the
International Securities, in each case as set forth on the cover of the
International Prospectus.
Notwithstanding the provisions of this Section 7, no Selling Shareholder
shall be required to contribute any amount in excess of the proceeds (net of
underwriting discounts and commissions) from the Securities sold by such
Selling Shareholder to the International Managers pursuant to this Agreement.
No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the ▇▇▇▇ ▇▇▇) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 7, each person, if any, who controls an
International Manager within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act shall have the same rights to contribution as such
International Manager, and each director of the Company, each officer of the
Company who signed the Registration Statement, and each person, if any, who
controls the Company within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act shall have the same rights to contribution as the
Company. The International Managers' respective obligations to contribute
pursuant to this Section 7 are several in proportion to the number of Initial
International Securities set forth opposite their respective names in Schedule
A hereto and not joint.
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The Selling Shareholders' respective obligations to contribute pursuant to
this Section 7 are several in proportion to the number of Initial International
Securities set forth opposite their respective names in Schedule B hereto and
not joint.
The provisions of this Section shall not affect any agreement among the
Company and any Selling Shareholder with respect to contribution.
SECTION 8. Representations, Warranties and Agreements to Survive Delivery.
All representations, warranties and agreements contained in this Agreement or
in certificates of officers of the Company or any of its Subsidiaries or any
Selling Shareholder submitted pursuant hereto, shall remain operative and in
full force and effect, regardless of any investigation made by or on behalf of
any International Manager or controlling person, or by or on behalf of the
Company or any Selling Shareholder, and shall survive delivery of the
Securities to the International Managers.
SECTION 9. Termination of Agreement.
(a) TERMINATION; GENERAL. The International Managers may terminate this
Agreement, by notice to the Company and the Selling Shareholders, at any time
at or prior to Closing Time (i) if there has been, since the time of execution
of this Agreement or since the respective dates as of which information is
given in the International Prospectus, any material adverse change in the
condition, financial or otherwise, or in the earnings, business affairs or
business prospects of the Company and its Subsidiaries, taken as a whole,
whether or not arising in the ordinary course of business, or (ii) if there has
occurred any material adverse change in the financial markets in the United
States or the international financial markets, any outbreak of hostilities or
escalation thereof or other calamity or crisis or any change or development
involving a prospective change in national or international political,
financial or economic conditions, in each case the effect of which is such as
to make it, in the judgment of the International Managers, impracticable to
market the Securities or to enforce contracts for the sale of the Securities,
or (iii) if trading in any securities of the Company has been suspended or
materially limited by the Commission or the Nasdaq National Market, or if
trading generally on the American Stock Exchange or the New York Stock Exchange
or in the Nasdaq National Market has been suspended or materially limited, or
minimum or maximum prices for trading have been fixed, or maximum ranges for
prices have been required, by any of said exchanges or by such system or by
order of the Commission, the National Association of Securities Dealers, Inc.
or any other governmental authority, or (iv) if a
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banking moratorium has been declared by either Federal or New York authorities.
(b) LIABILITIES. If this Agreement is terminated pursuant to this
Section, such termination shall be without liability of any party to any other
party except as provided in Section 4 hereof, and provided further that
Sections 1, 6, 7 and 8 shall survive such termination and remain in full force
and effect.
SECTION 10. Default by One or More of the International Managers. If one
or more of the International Managers shall fail at Closing Time or a Date of
Delivery to purchase the Securities which it or they are obligated to purchase
under this Agreement (the "Defaulted Securities"), the International Managers
shall have the right, but not the obligation, within 24 hours thereafter, to
make arrangements for one or more of the non-defaulting International Managers,
or any other underwriters, to purchase all, but not less than all, of the
Defaulted Securities in such amounts as may be agreed upon and upon the terms
herein set forth; if, however, the International Managers shall not have
completed such arrangements within such 24-hour period, then this Agreement
shall terminate without liability on the part of any non-defaulting
International Manager.
No action pursuant to this Section shall relieve any defaulting
International Manager from liability in respect of its default.
In the event of any such default which does not result in a termination of
this Agreement, either (i) the International Managers or (ii) the Company shall
have the right to postpone the Closing Time or a Date of Delivery for a period
not exceeding seven days in order to effect any required changes in the
Registration Statement or Prospectuses or in any other documents or
arrangement.
SECTION 11. Default by One or More of the Selling Shareholders. If one or
more Selling Shareholder(s) shall fail at Closing Time to sell and deliver the
number of Securities which such Selling Shareholder(s) are obligated to sell
hereunder, then the International Managers may, at option of the International
Managers, by notice from the Global Coordinator to the Company, either (a)
terminate this Agreement without any liability on the fault of any
non-defaulting party except that the provisions of Sections 1, 4, 6, 7 and 8
shall remain in full force and effect or (b) elect to purchase the Securities
which the Company and any non-defaulting Selling Shareholders have agreed to
sell hereunder. No action taken pursuant to this Section 11 shall relieve the
Selling Shareholder(s)
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so defaulting from liability, if any, in respect of such default.
In the event of a default by any Selling Shareholder as referred to in
this Section 11, each of the International Managers and the Company shall have
the right to postpone the Closing Time for a period not exceeding seven days in
order to effect any required change in the Registration Statement or
Prospectuses or in any other documents or arrangements.
SECTION 12. Notices. All notices and other communications hereunder shall
be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the
International Managers shall be directed to them at ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, attention of ; notices to the
Company shall be directed to it at ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇
▇▇▇▇▇, attention of General Counsel and with a copy to Skadden, Arps, Slate,
▇▇▇▇▇▇▇ & ▇▇▇▇ LLP, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, attention of
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.; notices to ▇▇▇▇ ▇▇▇▇▇▇-▇▇▇▇▇▇ and ▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇▇▇▇
shall be directed to them c/o Herrn ▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇▇▇▇, Lemmerz Holding GmbH,
Postfach 1125, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ of Germany and notices to
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ shall be directed to him at .
SECTION 13. Parties. This Agreement shall inure to the benefit of and be
binding upon the International Managers, the Company and each Selling
Shareholder and their respective successors. Nothing expressed or mentioned in
this Agreement is intended or shall be construed to give any person, firm or
corporation, other than the International Managers, the Company and each
Selling Shareholder and their respective successors and the controlling persons
and officers and directors referred to in Sections 6 and 7 and their heirs and
legal representatives, any legal or equitable right, remedy or claim under or
in respect of this Agreement or any provision herein contained. This Agreement
and all conditions and provisions hereof are intended to be for the sole and
exclusive benefit of the International Managers, the Company and each Selling
Shareholder and their respective successors, and said controlling persons and
officers and directors and their heirs and legal representatives, and for the
benefit of no other person, firm or corporation. No purchaser of Securities
from any International Manager shall be deemed to be a successor by reason
merely of such purchase.
SECTION 14. Information Supplied by the Selling Shareholders. The
statements set forth under the caption "Principal and Selling Stockholders"
concerning a Selling Stockholder contained in any preliminary prospectus, the
Prospectuses, the Registration Statement and any amendments or
-34-
40
supplement thereto constitute the only information furnished by such Selling
Stockholder for purposes of this Agreement.
SECTION 15. GOVERNING LAW AND TIME. THIS AGREEMENT SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. SPECIFIED
TIMES OF DAY REFER TO NEW YORK CITY TIME.
SECTION 16. Effect of Headings. The Article and Section headings herein
and the Table of Contents are for convenience only and shall not affect the
construction hereof.
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Company and the Attorney-in-Fact for
each Selling Shareholder a counterpart hereof, whereupon this instrument, along
with all counterparts, will become a binding agreement among the International
Managers, the Company and each Selling Shareholder in accordance with its
terms.
Very truly yours,
▇▇▇▇▇ WHEELS INTERNATIONAL, INC.
By: ____________________________________
Title:
THE SELLING SHAREHOLDERS
By: ____________________________________
as Attorney-in-Fact acting on behalf
of the Selling Shareholders named in
Schedule B hereto.
-35-
41
CONFIRMED AND ACCEPTED,
as of the date first above written:
▇▇▇▇▇▇▇ ▇▇▇▇▇ INTERNATIONAL
BEAR, ▇▇▇▇▇▇▇ INTERNATIONAL LIMITED
▇▇▇▇▇▇▇ ▇▇▇▇▇ INTERNATIONAL
BY: ▇▇▇▇▇▇▇ ▇▇▇▇▇ INTERNATIONAL
By: ____________________________
Authorized Signatory
-36-
42
SCHEDULE A
Number of
Initial
International
Name of International Manager Securities
----------------------------------- -------------
▇▇▇▇▇▇▇ ▇▇▇▇▇ International .......................
Bear, ▇▇▇▇▇▇▇ International Limited ...............
▇▇▇▇▇▇▇ ▇▇▇▇▇ International. ......................
---------
Total ............................................. =========
Sch ▇-▇
▇▇
▇▇▇▇▇▇▇▇ ▇
Number of Initial
International
Securities to be Sold
---------------------
▇▇▇▇▇ WHEELS
INTERNATIONAL, INC.
▇▇▇▇ ▇▇▇▇▇▇-▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ ---------
Total .........
Sch ▇-▇
▇▇
▇▇▇▇▇▇▇▇ ▇
▇▇▇▇▇ WHEELS INTERNATIONAL, INC.
779,502 Shares of Common Stock
(Par Value $.01 Per Share)
1. The initial public offering price per share for the Securities shall be
$.
2. The purchase price per share for the International Securities to be
paid by the several International Managers shall be $, being an amount equal
to the initial public offering price set forth above less $ per share [(the
"Net Proceeds Per Share")]; provided that the purchase price per share for any
International Option Securities purchased upon the exercise of the
over-allotment option described in Section 2(b) shall be reduced by an amount
per share equal to any dividends or distributions declared by the Company and
payable on the Initial International Securities but not payable on the
International Option Securities[; and provided further, that in the event that
the Net Proceeds Per Share is greater than $30, then, for each of the
International Securities sold by each of ▇▇▇▇ ▇▇▇▇▇▇-▇▇▇▇▇▇ and ▇▇▇▇▇▇
▇▇▇▇▇-▇▇▇▇▇▇▇, respectively, the International Managers shall pay to the
Company the amount by which Net Proceeds Per Share is greater than $30 per
share](1.)
---------------
(1) Include only if Net Proceeds Per Share exceeds $30.
Sch C-1
45
SCHEDULE D
Company Subsidiaries
▇▇▇▇▇ Wheels International - California, Inc.
▇▇▇▇▇ Wheels International - Michigan, Inc.
▇▇▇▇▇ Wheels International - Indiana, Inc.
▇▇▇▇▇ Wheels International - Georgia, Inc.
▇▇▇▇▇ Wheels International - Mexico, Inc.
HWI (Europe), Ltd.
▇▇▇▇▇ Wheels, S.p.A.
▇▇▇▇▇ Wheels Autokola NH, as
Reliable Transportation Components Inc.
▇▇▇▇▇ Wheels International - Missouri, Inc.
▇▇▇▇▇ Wheels International - Kentuckulus, Inc.
▇▇▇▇▇ Wheels Aftermarket, Inc.
▇▇▇▇▇ Wheels Japan Limited
▇▇▇▇▇ Wheels de Espana, S.A.
HWI Service Corporation
▇▇▇▇▇ Wheels Foreign Sales Corp.
Motor Wheel Corporation
MWC Acquisition Sub, Inc.
Motor Wheel de Mexico, S.A. de C.V.
Motor Wheel Corporation of Canada, Ltd.
AMW Holdings, Inc.
HL Holdings BV
HL Holdings de Espana
HL Holding Germany GmbH
▇▇▇▇▇ Wheels Hungary Consulting Limited Liability Company
Newco No. 17 Vermogensverwaltungs GmbH (post-Acquisition)
Newco No. 18 Vermogensverwaltungs GmbH (post-Acquisition)
Lemmerz Holding GmbH
Metaalgieterij ▇▇▇▇▇▇ B.V.
Lemmerz Espanola ▇.▇.
▇▇▇▇▇▇▇-Werke GmbH
Lemmerz-Werke Wohnungsbaugesellschaft mbH
Lemmerz Service System N.V.
Lemmerz Belgie N.V.
Lemmerz Comerico e Participacoes SRL
Lemmerz Canada Inc.
PSW Prazisions-und Spezialwerkzeuge AG
Lemmerz-Inci-Jany Sanayi A.S.
Company Joint Venture and Other Interests
Numbers in parentheses represent percent of total owned by the Company or one
of its subsidiaries.
▇▇▇▇▇ Wheels de Venezuela, C.A. (49)
▇▇▇▇▇ Wheels de Mexico, S.A. de C.V. (40)
Aluminum Wheel Technology, Inc. (50)
Sch ▇-▇
▇▇
▇▇▇▇▇▇▇ Tool Company (30)
▇▇▇▇▇ Wheels do Brasil, Ltda. (49)
Continental Lemmerz (Portugal), Componentes para
Automoveis, Lda. (49)
Borlem S.A. Empreendimentos Industriais (45)
▇▇▇▇▇▇▇▇-▇▇▇▇▇▇▇ Industries (25)
Kalyani-Lemmerz Ltd. (25)
Jantas Jant Sanayi ve Ticaret S.A. (25)
Siam Lemmerz Co., Ltd. (25)
Additional Information
See Section 4.3(c), paragraph (ii), of the disclosure schedule provided by
Lemmerz pursuant to the acquisition agreement dated as of June 6, 1997 among
the Company, Cromodoro Wheels S.p.A., and the shareholders of Lemmerz (the
"Acquisition Agreement") regarding certain qualifying shares held by third
parties in certain subsidiaries of Lemmerz.
Sch D-2
47
SCHEDULE E
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ & ▇▇▇▇ Fund II, L.P.
TSG Capital Fund II, L.P.
CIBC WG Argosy Merchant Fund 2, L.L.C.
Nomura Holding America, Inc.
Chase Equity Associates, L.P.
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇-▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇▇▇▇
▇▇▇▇▇ (▇▇▇) ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Sch ▇-▇
▇▇
▇▇▇▇▇▇▇ ▇-▇
FORM OF OPINION OF COMPANY'S
COUNSEL TO BE DELIVERED
PURSUANT TO SECTION 5(b)
(i) The Securities to be purchased by the U.S. Underwriters and the
International Managers from the Company have been duly authorized by the
Company and, when issued and delivered by the Company pursuant to the
U.S. Purchase Agreement and the International Purchase Agreement,
respectively, against payment of the consideration set forth in the U.S.
Purchase Agreement and the International Purchase Agreement,
respectively, will be validly issued, fully paid and non-assessable and
no holder of the Securities is or will be subject to personal liability
by reason of being such a holder.
(ii) The Company has the requisite corporate power and authority to
execute, deliver and perform its obligations under the U.S. Purchase
Agreement and the International Purchase Agreement. The U.S. Purchase
Agreement and the International Purchase Agreement have been duly
authorized by the Company and, when executed and delivered by the
Company, will constitute a valid and binding agreements of the Company,
enforceable against the Company in accordance with their terms except
that (a) we express no opinion as to the enforceability of any rights to
contribution or indemnity provided for in any such agreement to the
extent any such rights are violative of any law, rule or regulation or
the public policy underlying any law, rule or regulation (including
federal or state securities law, rule or regulation) and (b) enforcement
thereof may be limited by (i) bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium or other similar laws now or
hereafter in effect relating to creditors' rights generally and (ii)
general principles of equity (regardless of whether such enforcement is
considered in a proceeding at law or in equity).
(iii) The Registration Statement, including any Rule 462(b)
Registration Statement, has been declared effective under the 1933 Act;
any required filing of the Prospectuses pursuant to Rule 424(b) has been
made in the manner and within the time period required by Rule 424(b);
and, to the best of our knowledge, no stop order suspending the
49
-2-
effectiveness of the Registration Statement or any Rule 462(b)
Registration Statement has been issued under the 1933 Act and, to the
best of our knowledge, no proceedings for that purpose have been
instituted or are pending or threatened by the Commission.
(iv) The Registration Statement as of its effective date, and the
Prospectuses, as of their respective dates, excluding the documents
incorporated by reference therein, and each amendment or supplement to
the Registration Statement and Prospectuses filed with the Commission
through the date hereof, excluding the documents incorporated by
reference therein (other than the financial statements and schedules
included therein or omitted therefrom, as to which we express no opinion)
appear on their face to be appropriately responsive in all material
respects to the requirements of the 1933 Act and the 1933 Act
Regulations, except that we do not assume any responsibility for the
accuracy, completeness or fairness of the statements contained in the
Registration Statement and the Prospectuses other than, to the extent set
forth in paragraph (viii) below, those made in the Prospectuses under the
caption "Description of Capital Stock".
(v) The form of certificate used to evidence the Common Stock
complies in all material respects with all applicable statutory
requirements, with any applicable requirements of the charter and by-laws
of the Company and the requirements of the Nasdaq National Market.
(vi) No Governmental Approval is required for the performance by the
Company of its obligations under the U.S. Purchase Agreement, the
International Purchase Agreement or the consummation of the transactions
contemplated thereby relating to the Securities, other than under the
1933 Act and the 1933 Act Regulations, which have been obtained.
As used in such counsel's opinion, (a) the term "Applicable Laws"
means, to the extent specifically referred to herein, the General
Corporation Law of the State of Delaware, and those laws of the State of
New York and the United States of America, in each case, that, in our
experience, are normally applicable to transactions of the type provided
for by the Purchase Agreements but without our having made any special
investigation with respect to any other laws; provided that "Applicable
Laws" does not include any [federal or] state securities laws or blue sky
50
-3-
laws of any jurisdiction, anti-fraud laws of any jurisdiction, rules and
regulations of the National Association of Securities Dealers, Inc.; (b)
the term "Governmental Authority" means any Delaware, New York or United
States federal executive, legislative, judicial, administrative or
regulatory body; and (c) the term "Governmental Approval" means any
authorization, approval, consent or order of, or filing with, any
Governmental Authority under Applicable Laws, other than any such
authorization, approval, consent, order or filing which may have become
applicable to the Company or any of its Subsidiaries as a result of the
involvement by any Selling Shareholder or any Underwriter in the
transactions contemplated by the Purchase Agreements or because of the
legal or regulatory status of, or any other facts specifically pertaining
to, any Selling Shareholder or any Underwriter.
(vii) The execution, delivery and performance by the Company of the
U.S. Purchase Agreement and the International Purchase Agreement and the
consummation by the Company of the transactions contemplated thereby will
not violate or conflict with the Restated Certificate of Incorporation or
Amended and Restated By-laws of the Company.
(viii) The statements set forth in the Prospectuses under the
caption "Description of Capital Stock," insofar as such statements
constitute a summary of the terms of the Company's Restated Certificate
of Incorporation and Amended and Restated By-laws, fairly summarize such
terms in all material respects.
(ix) None of the Company or the Subsidiaries is required to register
as an "investment company" or a company "controlled by" an "investment
company" as such terms are defined in the Investment Company Act of 1940,
as amended.
In addition, we have participated in conferences with officers and
other representatives of the Company, representatives of the independent
public accountants and representatives of the Underwriters at which the
contents of the Registration Statement and the Prospectuses were discussed and,
although we are not passing upon and do not assume any responsibility for the
accuracy, completeness or fairness of the statements contained in the
Registration Statement or Prospectuses (except as indicated in clause (viii)
above) and have not made any independent check or verification thereof, on the
basis of the foregoing (relying as to materiality to the extent we deemed
51
-4-
appropriate upon the statements of officers and other representatives of the
Company) no facts have come to our attention that have caused us to believe
that the Registration Statement at the time it became effective, or any post
effective amendment thereto as of its date, contained an untrue statement of a
material fact or omitted to state a material fact required to be stated therein
or necessary to make the statements therein not misleading, or that either
Prospectus as of its date and as of the Closing Date contained or contains an
untrue statement of a material fact or omitted 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 (it being understood
that we express no opinion on or belief with respect to the financial
statements or other financial and statistical data or information included or
incorporated by reference in the Registration Statement or the Prospectuses or
the exhibits to the Registration Statement).
52
EXHIBIT A-2
FORM OF OPINION OF GENERAL COUNSEL
OF THE COMPANY TO BE DELIVERED PURSUANT
TO SECTION 5(b)
(i) The Company and each of the Subsidiaries has been duly incorporated
and is validly existing in good standing, as a corporation under the laws of
its jurisdiction of incorporation, with the requisite corporate power and
authority to own its properties and conduct its business as described in the
Prospectuses and is duly qualified to do business as a foreign corporation in
good standing in all other jurisdictions where the ownership or leasing of its
properties or the conduct of its business requires such qualification, except
where the failure to be so qualified would not, individually or in the
aggregate, have a Material Adverse Effect; the outstanding shares of capital
stock of the Company (including the Securities to be purchased by the
Underwriters from the Selling Shareholders) and the Subsidiaries have been duly
authorized and validly issued, are fully paid and non-assessable and were not
issued in violation of any preemptive or similar rights and, in the case of the
Subsidiaries, except in connection with the Amended Credit Agreement (as
defined in the Prospectuses), are owned free and clear of all liens,
encumbrances, equities and restrictions on transferability (other than those
imposed by the 1933 Act and the state securities or "Blue Sky" laws); to the
best of my knowledge, except as set forth in the Prospectuses, no options,
warrants or other rights to purchase from the Company or any Subsidiary or,
agreements or other obligations of the Company or any Subsidiary to issue or
other rights to cause the Company, to convert any obligation into, or exchange
any securities for, shares of capital stock or ownership interests in the
Company or any Subsidiary are outstanding.
(ii) The issuance and sale of the Securities by the Company and the sale
of the Securities by the Selling Shareholders is not subject to the preemptive
or other similar rights of any securityholder of the Company.
(iii) No consent, approval, authorization or order of any governmental
agency or body, or to the best of such counsel's knowledge, any court, is
required for the performance of any of the U.S. Purchase Agreement, the
International Purchase Agreement or any of the agreements contemplated thereby
or delivered in connection therewith, or the consummation of the transactions
contemplated thereby, except such as may be required and have been obtained as
described in the Prospectuses or under the 1933 Act and the 1933 Act
Regulations, or as may
A-1
53
be required under state securities or "Blue Sky" laws as to which such counsel
need express no opinion.
(iv) None of the Company or the Subsidiaries is (a) in violation of its
certificate of incorporation or bylaws, (b) in violation of any statute,
judgment, decree, order, rule or regulation applicable to any of its properties
or assets, which violation would, individually or in the aggregate, have a
Material Adverse Effect or (c) in breach of or in default under any material
contract, indenture, mortgage, deed of trust, loan agreement, note, lease,
license, franchise agreement, permit, certificate or other material agreement
or instrument to which it is a party or to which it is subject, which breach or
default would individually or in the aggregate, have a Material Adverse Effect.
(v) The execution, delivery and performance by the Company of the U.S.
Purchase Agreement, the International Purchase Agreement and the consummation
by the Company of the transactions contemplated thereby and the fulfillment of
the terms thereof, will not violate, conflict with or constitute or result in a
breach of or a default under (or an event that with notice or lapse of time, or
both, would constitute a breach of or a default under) any of the terms or
provisions of (a) any material indenture, mortgage, deed of trust, loan
agreement, note, lease, license, franchise agreement or other material
agreement or instrument to which the Company or any of the Subsidiaries is a
party or to which any of their respective properties or assets are subject or
(b) to the best of such counsel's knowledge (assuming compliance with all
applicable Federal and state securities and "Blue Sky" laws) any statute,
judgment, decree, order, rule or regulation of any court or governmental agency
or body applicable to the Company or any of the Subsidiaries or any of their
respective properties or assets, which violation, conflict, breach or default
would, individually or in the aggregate, have any Material Adverse Effect.
(vi) Except as described in the Prospectuses, there are no legal or
governmental proceedings pending or threatened to which the Company or any of
the Subsidiaries is a party or to which the respective properties or assets of
the Company or the Subsidiaries are subject that are required to be described
in the Prospectuses that are not described therein, or that seek to restrain,
enjoin, prevent the consummation of or otherwise challenge the issuance or sale
of the Securities to the Underwriters or the consummation of the transactions
described in the Prospectuses under the captions "Use of Proceeds"; and no
contract, agreement or other document is required to be described in the
Registration Statement or the Prospectuses or to be filed as an exhibit to the
Registration Statement that is not described therein or filed as required.
A-2
54
I have participated in conferences with officers and other representatives
of the Company, representatives of the independent public accountants for the
Company, outside counsel for the Company, your counsel and your representatives
at which the contents of the Registration Statement and the Prospectuses and
related matters were discussed and, although I am not passing upon and do not
assume any responsibility for the accuracy, completeness or fairness of the
statements contained in the Registration Statement or the Prospectuses, I
advise you that, on the basis of the foregoing, no facts have come to my
attention that lead me to believe that the Registration Statement at the time
it became effective, or any post effective amendment thereto as of its date,
contained an untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the statements therein
not misleading, or that either Prospectus as of its date and as of the Closing
Date contained or contains an untrue statement of a material fact or omitted or
omits to state a material fact necessary to make the statements therein, in the
light of the circumstances under which they were made, not misleading (it being
understood that I have not been requested to and do not make any comment with
respect to the financial statements and the notes thereto and other financial
and accounting information included or incorporated by reference in the
Registration Statement or the Prospectuses or the exhibits to the Registration
Statement).
A-3
55
EXHIBIT B
FORM OF OPINION OF COUNSEL FOR THE SELLING SHAREHOLDER(S)
TO BE DELIVERED PURSUANT TO SECTION 5(c)
(i) The Power of Attorney [and Custody Agreement] has been duly executed
and delivered by the Selling Shareholder(s) and constitutes the legal, valid
and binding agreement of the Selling Shareholder(s).
(ii) The U.S. Purchase Agreement and the International Purchase Agreement
have been duly executed and delivered by or on behalf of the Selling
Shareholder(s).
(iii) The execution, delivery and performance of the U.S. Purchase
Agreement, the International Purchase Agreement, the Power of Attorney [and
Custody Agreement] and the sale and delivery of the Securities and the
consummation of the transactions contemplated in the U.S. Purchase Agreement
and the International Purchase Agreement and in the Registration Statement and
compliance by the Selling Shareholder(s) with its/their obligations under the
U.S. Purchase Agreement and the International Purchase Agreement do not and
will not, whether with or without the giving of notice or passage of time or
both, 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 the
Securities or any property or assets of the Selling Shareholder(s) pursuant to,
any contract, indenture, mortgage, deed of trust, loan or credit agreement,
note, license, lease or other instrument or agreement to which the Selling
Shareholder(s) is a party or by which he/she may be bound, or to which any of
the property or assets of the Selling Shareholder(s) may be subject nor will
such action result in any violation of any law, administrative regulation,
judgment or order of any governmental agency or body or any administrative or
court decree having jurisdiction over the Selling Shareholder(s) or any of
his/her properties.
(iv) By delivery of a certificate or certificates therefor the Selling
Shareholder(s) will transfer to the U.S. Underwriters and the International
Managers who have purchased such Securities pursuant to the U.S. Purchase
Agreement and the International Purchase Agreement, respectively, (without
notice of any defect in the title of the Selling Shareholder(s) and who are
otherwise bona fide purchasers for purposes of the Uniform Commercial Code)
valid and marketable title to such Securities, free and clear of any pledge,
lien, security interest, charge, claim, equity or encumbrance of any kind.
▇-▇
▇▇
▇▇▇▇▇▇▇ ▇
, ▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO.
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated,
BEAR, ▇▇▇▇▇▇▇ & CO. INC.
▇▇▇▇▇▇▇, ▇▇▇▇▇ & CO.
▇▇▇▇▇▇▇ ▇▇▇▇▇ INTERNATIONAL
BEAR, ▇▇▇▇▇▇▇ INTERNATIONAL LIMITED
▇▇▇▇▇▇▇ ▇▇▇▇▇ INTERNATIONAL
▇/▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇.
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Re: Proposed Public Offering by ▇▇▇▇▇
Wheels International, Inc.
Dear Sirs:
The undersigned, a stockholder of ▇▇▇▇▇ Wheels International, Inc., a
Delaware corporation (the "Company"), understands that ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co. and
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated ("▇▇▇▇▇▇▇ ▇▇▇▇▇"), Bear,
▇▇▇▇▇▇▇ & Co. Inc. and ▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co. propose to enter into a U.S.
Purchase Agreement (the "U.S. Purchase Agreement") with the Company and the
Selling Shareholders named therein providing for the public offering of shares
of the Company's common stock, par value $.01 per share (the "Common Stock").
Simultaneously, ▇▇▇▇▇▇▇ ▇▇▇▇▇ International, Bear, ▇▇▇▇▇▇▇ International
Limited and ▇▇▇▇▇▇▇ ▇▇▇▇▇ International propose to enter into an International
Purchase Agreement (the "International Purchase Agreement" and, together with
the U.S. Purchase Agreement, the "Purchase Agreements") with the Company and
the Selling Shareholders named therein providing for the public offering of
shares of Common Stock. Capitalized terms used herein without definition shall
have the meanings assigned thereto in the Purchase Agreements. In recognition
of the benefit that such offerings will confer upon the undersigned as a
stockholder of the Company, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the undersigned
agrees with each Underwriter that, during the pe-
C-1
57
riod from the date of the Prospectuses to the date which is 120 days
thereafter, the undersigned will not, without the prior written consent of the
Global Coordinator, directly or indirectly, sell, offer to sell, grant any
option for the sale of, or otherwise dispose of, any shares of the Common Stock
or any securities convertible into or exchangeable or exercisable for Common
Stock, whether now owned or hereafter acquired by the undersigned or with
respect to which the undersigned has or hereafter acquires the power of
disposition. The foregoing sentence shall not apply (A) with respect to either
of ▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇▇▇▇ or ▇▇▇▇ ▇▇▇▇▇▇-▇▇▇▇▇▇, to (1) the Securities to be sold
under the Purchase Agreements or (2) any shares of Common Stock sold or
purchased upon exercise of the Option (as defined in the Option Agreement,
dated as of July 30, 1997, among the Company, ▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇▇▇▇ and ▇▇▇▇
▇▇▇▇▇▇-▇▇▇▇▇▇) or (B) with respect to any of ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇
▇▇▇▇▇-▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇-▇▇▇▇▇▇ or ▇▇▇▇▇ ▇▇▇▇▇-Lemerz, to any shares of
Common Stock issued upon conversion of the shares of the Company's Class A
Preferred Stock outstanding on the date hereof.
Very truly yours,
Signature:____________________________
Print Name:___________________________
C-2