Exhibit 99.2
PURCHASE AGREEMENT
THIS PURCHASE AGREEMENT (this "Agreement") is made as of the 19th day of
May, 2000, by and among Hanover Compressor Company, a Delaware corporation (the
"Company"), and the purchaser whose name and address is set forth on the
signature page hereof (the "Investor").
1. Authorization and Sale of the Shares. Subject to the terms and conditions
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of this Agreement, the Company has authorized the issuance and sale of up to
1,000,000 shares (the "Shares") of the common stock, par value $.001 per share
(the "Common Stock"), of the Company to certain investors in a private placement
(the "Offering"). The Company reserves the right to increase or decrease the
number of Shares offered and sold in the Offering prior to the Closing Date (as
defined below).
2. Agreement to Sell and Purchase the Shares; Subscription Date.
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2.1 At the Closing (as defined in Section 3 hereof), the Company will sell
to the Investor, and the Investor will purchase from the Company, upon the terms
and conditions hereinafter set forth, the number of Shares set forth on the
signature page hereto at the purchase price set forth on such signature page.
If the Closing Date has not occurred, the Company's obligation to sell and the
Investor's obligation to purchase the Shares will expire on May 31, 2000.
2.2 The Company proposes to enter into this same form of Purchase
Agreement with certain other investors (the "Other Investors") and expects to
complete sales of Shares to them. (The Investor and the Other Investors are
hereinafter sometimes collectively referred to as the "Investors," and this
Agreement and the Purchase Agreements executed by the Other Investors are
hereinafter sometimes collectively referred to as the "Agreements.")
3. Delivery of the Shares at Closing. The completion of the purchase and sale
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of the Shares (the "Closing") shall occur at Hanover Compressor Company, ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ on May 19, 2000. (the "Closing Date")
At the Closing, each Investor shall make payment for the Shares to the Company
or its order by wire transfer of immediately available funds to the account
specified by the Company as set forth on the signature page hereto. Such payment
shall be made upon delivery of certificates for the Shares to the respective
accounts of the Investors representing the number of Shares set forth on the
signature page hereto, each such certificate to be registered in the name of the
Investor or, if so indicated on the signature page hereto, in the name of a
nominee designated by the Investor.
The Company's obligation to issue the Shares to the Investor shall be
subject to the following conditions, any one or more of which may be waived by
the Company: (a) receipt by the Company of the purchase price for the Shares
being purchased hereunder as set forth on the signature page hereto; and (b) the
accuracy, in all material respects, of the representations and warranties made
by the Investors and the fulfillment of those undertakings of the Investors to
be fulfilled prior to the Closing.
The Investor's obligation to purchase the Shares shall be subject to the
accuracy in all material respects of the representations and warranties made by
the Company and the fulfillment of those undertakings of the Company to be
fulfilled prior to the Closing. The Investor's obligations are expressly not
conditioned on the purchase by any or all of the other Investors of the Shares
that they have agreed to purchase from the Company.
4. Representations, Warranties and Covenants of the Company. The Company
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hereby represents and warrants to, and covenants with, the Investor, as follows:
4.1 Organization. The Company is duly incorporated and validly existing
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and in good standing under the laws of the jurisdiction of its organization. The
Company has full corporate power and authority to own, operate and occupy its
properties and to conduct its business as presently conducted and as described
in the Exchange Act Documents (as defined below) and is registered or qualified
to do business and in good standing in each jurisdiction in which it owns or
leases property or transacts business and where the failure to be so qualified
would have a
material adverse effect upon the business, financial condition, properties or
operations of the Company ("Material Adverse Effect"), and no proceeding has
been instituted in any such jurisdiction revoking, limiting or curtailing, or
seeking to revoke, limit or curtail, such power and authority or qualification.
4.2 Due Authorization. The Company has all requisite corporate power and
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authority to execute, deliver and perform its obligations under the Agreements,
and the Agreements have been duly authorized and validly executed and delivered
by the Company and constitute valid and binding agreements of the Company
enforceable against the Company in accordance with their terms, except as rights
to indemnity and contribution may be limited by state or federal securities laws
or the public policy underlying such laws, except as enforceability may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting creditors' and contracting parties' rights generally and
except as enforceability may be subject to general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law).
4.3 Non-Contravention. The execution and delivery of the Agreements, the
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issuance and sale of the Shares to be sold by the Company under the Agreements,
the fulfillment of the terms of the Agreements and the consummation of the
transactions contemplated thereby will not (A) conflict with or constitute a
breach of, or default (with the passage of time or otherwise) under, (i) any
material bond, debenture, note or other evidence of indebtedness, or any
material lease, contract, indenture, mortgage, deed of trust, loan agreement,
joint venture or other agreement or instrument to which the Company is a party
or by which it or its properties are bound, (ii) the charter, by-laws or other
organizational documents of the Company, or (iii) any law, administrative
regulation, ordinance or order of any court or governmental agency, arbitration
panel or authority binding upon the Company or its properties, where such
conflict, breach or default is likely to result in a Material Adverse Effect, or
(B) result in the creation or imposition of any material lien, encumbrance,
claim, security interest or restriction whatsoever upon any of the material
properties or assets of the Company or a material acceleration of indebtedness
pursuant to any obligation, agreement or condition contained in any material
bond, debenture, note or any other material evidence of indebtedness or any
material indenture, mortgage, deed of trust or any other material agreement or
instrument to which the Company is a party or by which any of them is bound or
to which any of the material property or assets of the Company is subject. No
consent, approval, authorization or other order of, or registration,
qualification or filing with, any regulatory body, administrative agency, or
other governmental body in the United States is required for the execution and
delivery of the Agreements and the valid issuance and sale of the Shares to be
sold pursuant to the Agreements, other than such as have been made or obtained,
except for any securities filings required to be made under federal or state
securities laws, and except where any failure to obtain any of the foregoing
would not have a Material Adverse Effect.
4.4 Capitalization. The capitalization of the Company as of May 8, 2000 is
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as follows: 100,000,000 shares of Common Stock and 3,000,000 shares of preferred
stock, par value $.01 per share, are authorized under the Company's certificate
of incorporation, of which 28,878,516 shares of Common Stock and no shares of
preferred stock were issued and outstanding. The Company has not issued any
capital stock since that date other than pursuant to the Company's employee
benefit plans. The Shares to be sold pursuant to the Agreements have been duly
authorized, and when issued and paid for in accordance with the terms of the
Agreements, will be duly and validly issued, fully paid and nonassessable. The
outstanding shares of capital stock of the Company have been duly and validly
issued and are fully paid and nonassessable, have been issued in compliance with
all federal and state securities laws, and were not issued in violation of any
preemptive rights or similar rights to subscribe for or purchase securities.
Except as set forth in or contemplated by the Exchange Act Documents, there are
no outstanding rights (including, without limitation, preemptive rights),
warrants or options to acquire, or instruments convertible into or exchangeable
for, any unissued shares of capital stock or other equity interest in the
Company, or any contract, commitment, agreement, understanding or arrangement of
any kind to which the Company is a party and relating to the issuance or sale of
any capital stock of the Company, any such convertible or exchangeable
securities or any such rights, warrants or options. Without limiting the
foregoing and other than certain registration rights previously granted by the
Company to certain Company shareholders which may (under certain circumstances)
delay the registration of the Investors' Shares, no preemptive right, co-sale
right, right of first refusal or other similar right exists with respect to the
issuance and sale of the Shares. Except as set forth in the Exchange Act
Documents and Schedule 4.4 hereto, the Company has no subsidiaries (as defined
in Rule 405 under the Securities Act of 1933, as amended (the "Securities Act"))
and does not own, directly or indirectly, any equity interest in any firm,
partnership, joint venture, association or other entity. Except as disclosed in
the Exchange Act Documents, there are no stockholder agreements, voting
agreements or other similar agreements with respect to the Common Stock to which
the Company is a party.
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4.5 Legal Proceedings. There is no material legal or governmental
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proceeding pending to which the Company or any Subsidiary is a party or of which
the business or property of the Company is subject that is not disclosed in the
Exchange Act Documents.
4.6 No Violations. The Company is not (i) in violation of its charter,
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bylaws or other organizational document, or in violation of any law,
administrative regulation, ordinance or order of any court or governmental
agency, arbitration panel or authority applicable to the Company, which
violation, individually or in the aggregate, would be reasonably likely to have
a Material Adverse Effect, or (ii) in default (and there exists no condition
which, with the passage of time or otherwise, would constitute a default) in the
performance of any material bond, debenture, note or any other evidence of
indebtedness, or in any material indenture, mortgage, deed of trust or any other
material agreement or instrument to which the Company is a party or by which the
Company is bound or by which its properties are bound, which would be reasonably
likely to have a Material Adverse Effect.
4.7 Governmental Permits, Etc. The Company has all necessary franchises,
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licenses, certificates and other authorizations from any foreign, federal, state
or local government or governmental agency, department or body that are
currently necessary for the operation of the business of the Company as
currently conducted, except where the failure to currently possess would not
reasonably be expected to have a Material Adverse Effect.
4.8 Intellectual Property. The Company owns, possesses or can acquire on
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reasonable terms, adequate trademarks, trade names or other rights to
inventions, know-how, patents, copyrights, confidential information and other
intellectual property (collectively, "Intellectual Property") necessary to
conduct the business now operated by the Company, or presently employed by the
Company, and has not received any notice of infringement of or conflict with
asserted rights of others with respect to any Intellectual Property that, if
determined adversely to the Company, would be reasonably likely to have a
Material Adverse Effect.
4.9 Financial Statements. The financial statements of the Company and
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the related notes contained in the Exchange Act Documents present fairly, in
accordance with generally accepted accounting principles, the financial position
of the Company as of the dates indicated, and the results of its operations and
cash flows for the periods therein specified. Such financial statements
(including the related notes) have been prepared in accordance with generally
accepted accounting principles applied on a consistent basis throughout the
periods therein specified, except as may be disclosed in the Exchange Act
Documents.
4.10 No Material Adverse Change. Since March 31, 2000, there has not been
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(i) any Material Adverse Effect affecting the Company, (ii) any obligation,
direct or contingent, that is material to the Company, incurred by the Company,
except obligations incurred in the ordinary course of business, (iii) any
dividend or distribution of any kind declared, paid or made on the capital stock
of the Company other than the declaration by the Company's board of directors on
May 18, 2000 of a 2:1 stock dividend payable to holders of Common Stock on June
13, 2000, or (iv) any loss or damage (whether or not insured) to the physical
property of the Company which has had a Material Adverse Effect.
4.11 Disclosure. The information contained in the Exchange Act Documents
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as of the date of the filing of such Exchange Act Documents did not contain an
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.
4.12 NYSE Compliance. The Company's Common Stock is registered pursuant to
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Section 12(g) of the Exchange Act (as defined in Section 4.13) and is listed on
the New York Stock Exchange (the "NYSE"), and the Company has taken no action
designed to, or likely to have the effect of, terminating the registration of
the Common Stock under the Exchange Act or de-listing the Common Stock from the
NYSE, nor has the Company received any notification that the Securities and
Exchange Commission (the "SEC") or the NYSE is contemplating terminating such
registration or listing.
4.13 Reporting Status. The Company has filed in a timely manner all
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documents that the Company was required to file under the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), during the 12 months
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preceding the date of this Agreement. The following documents complied in all
material respects with the SEC's requirements as of their respective filing
dates:
(a) Annual Report on Form 10-K for the Year Ended December 31, 1999,
filed with the SEC on March 30, 2000;
(b) Definitive Proxy Statement on Schedule 14A, filed with the SEC on
April 19, 2000;
(c) Quarterly Report on Form 10-Q for the Quarter Ended March 31,
2000, filed with the SEC on May 15,2000;
(d) Current Reports on Form 8-K, filed with the SEC on May 5, 2000;
and
(e) All other documents, if any, filed by the Company with the SEC
since December 31, 1999 pursuant to the reporting requirements of
the Exchange Act (collectively, the "Exchange Act Documents").
4.14 Listing. The Company shall use its reasonable best efforts to comply
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with all requirements of the NYSE with respect to the issuance of the Shares and
the listing thereof on the NYSE.
4.15 No Manipulation of Stock. The Company has not taken and will not, in
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violation of applicable law, take, any action designed to or that might
reasonably be expected to cause or result in manipulation of the price of the
Common Stock to facilitate the sale or resale of the Shares.
4.16 Accountants. PriceWaterhouseCoopers LLP, who have expressed their
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opinion with respect to the financial statements to be incorporated by reference
from the Company's Annual Report on Form 10-K for the year ended December 31,
1999 into the Registration Statement (as defined below) and the Prospectus which
forms a part thereof, are independent accountants as required by the Securities
Act and the rules and regulations promulgated thereunder (the "Rules and
Regulations").
4.17 Contracts. The contracts described in the Exchange Act Documents or
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incorporated by reference therein that are material to the Company are in full
force and effect on the date hereof, and neither the Company nor, to the
Company's knowledge, any other party to such contracts is in breach of or
default under any of such contracts which would have a Material Adverse Effect.
4.18 Properties. The Company has good and marketable title to all the
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properties and assets reflected as owned by it in the financial statements
included in or incorporated by reference into the Exchange Act Documents,
subject to no lien, mortgage, pledge, charge or encumbrance of any kind except
(i) those, if any, reflected in such financial statements, or (ii) those which
are not material in amount and do not adversely affect the use made and promised
to be made of such property by the Company. The Company holds its leased
properties under valid and binding leases, with such exceptions as are not
materially significant in relation to their respective businesses. Except as
disclosed in the Exchange Act Documents, the Company owns or leases all such
properties as are necessary to its operations as now conducted.
4.19 Taxes. The Company has filed all necessary federal, state and foreign
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income and franchise tax returns, except where the failure to file such returns
would not have a Material Adverse Effect. The Company has paid all taxes shown
as due thereon; and, other than tax deficiencies that the Company is contesting
in good faith and for which adequate reserves have been provided, there is no
tax deficiency that has been asserted against the Company that would have a
Material Adverse Effect.
4.20 Transfer Taxes. On the Closing Date, all stock transfer or other
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taxes (other than income taxes) which are required to be paid in connection with
the sale and transfer of the Shares to be sold to the Investor hereunder will
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be, or will have been, fully paid or provided for by the Company and all laws
imposing such taxes will be or will have been fully complied with.
4.21 Investment Company. The Company is not required to be registered as
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an "investment company" under the Investment Company Act of 1940, as amended.
4.22 Offering Materials. Other than the Exchange Act Documents (the
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"Offering Materials"), the Company has not distributed and will not distribute
prior to the Closing Date any offering material in connection with the offering
and sale of the Shares. The Company has not in the past nor will it hereafter
take any action to sell, offer for sale or solicit offers to buy any securities
of the Company which would bring the offer, issuance or sale of the Shares, as
contemplated by this Agreement, within the provisions of Section 5 of the
Securities Act.
4.23 Insurance. The Company maintains and will continue to maintain
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insurance of the types and in the amounts that the Company reasonably believes
is adequate for its business, including, but not limited to, insurance covering
all real and personal property owned or leased by the Company against theft,
damage, destruction, acts of vandalism and all other risks customarily insured
against by similarly situated companies, all of which insurance is in full force
and effect.
4.24 Contributions. The Company has not at any time since its
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incorporation, directly or indirectly, (i) made any unlawful contribution to any
candidate for public office, or failed to disclose fully any contribution in
violation of law, or (ii) made any payment to any federal or state governmental
officer or official, or other person charged with similar public or quasi-public
duties, other than payments required or permitted by the laws of the United
States or any jurisdiction thereof.
4.25 Legal Opinion The Company shall cause to be delivered to the
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Investors by counsel to the Company a customary legal opinion pertaining to Rule
10b-5 under the Exchange Act and to the availability of an exemption from the
registration provisions of the Securities Act.
5. Representations, Warranties and Covenants of the Investor.
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5.1 The Investor represents and warrants to, and covenants with, the
Company that: (i) the Investor is an "accredited investor" as defined in
Regulation D under the Securities Act and the Investor is also knowledgeable,
sophisticated and experienced in making, and is qualified to make decisions with
respect to, investments in shares presenting an investment decision like that
involved in the purchase of the Shares, including investments in securities
issued by the Company and investments in comparable companies, and has
requested, received, reviewed and considered all information it deemed relevant
in making an informed decision to purchase the Shares; (ii) the Investor is
acquiring the number of Shares set forth on the signature page hereto in the
ordinary course of its business and for its own account for investment only and
with no present intention of distributing any of such Shares and no arrangement
or understanding exists with any other person regarding the distribution of such
Shares; (iii) the Investor will not, directly or indirectly, offer, sell,
pledge, transfer or otherwise dispose of (or solicit any offers to buy, purchase
or otherwise acquire or take a pledge of) any of the Shares except in compliance
with the Securities Act, applicable state securities laws and the respective
rules and regulations promulgated thereunder; (iv) the Investor has answered all
questions on the signature page hereto for use in preparation of the
Registration Statement (as defined in Section 7.1) and the answers thereto are
true and correct as of the date hereof and will be true and correct as of the
Closing Date; (v) the Investor will notify the Company immediately of any change
in any of such information until such time as the Investor has sold all of its
Shares or until the Company is no longer required to keep the Registration
Statement effective; and (vi) the Investor has, in connection with its decision
to purchase the number of Shares set forth on the signature page hereto, relied
only upon the Offering Materials and the representations and warranties of the
Company contained herein. Investor understands that its acquisition of the
Shares has not been registered under the Securities Act or registered or
qualified under any state securities law in reliance on specific exemptions
therefrom, which exemptions may depend upon, among other things, the bona fide
nature of the Investor's investment intent as expressed herein. Investor has
completed or caused to be completed and delivered to the Company the Investor
Questionnaire attached as Exhibit A hereto, which questionnaire is true and
correct in all material respects.
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5.2 The Investor acknowledges, represents and agrees that no action has
been or will be taken in any jurisdiction outside the United States by the
Company that would permit an offering of the Shares, or possession or
distribution of offering materials in connection with the issue of the Shares,
in any jurisdiction outside the United States where action for that purpose is
required.
5.3 The Investor hereby covenants with the Company not to make any sale of
the Shares without complying with the provisions of this Agreement, including
Section 7.2 hereof, and without effectively causing the prospectus delivery
requirement under the Securities Act to be satisfied, and the Investor
acknowledges that the certificates evidencing the Shares will be imprinted with
a legend that prohibits their transfer except in accordance therewith. The
Investor acknowledges that there may occasionally be times when the Company,
based on the advice of its counsel, determines that it must suspend the use of
the Prospectus forming a part of the Registration Statement until such time as
an amendment to the Registration Statement has been filed by the Company and
declared effective by the SEC or until the Company has amended or supplemented
such Prospectus.
5.4 The Investor further represents and warrants to, and covenants with,
the Company that (i) the Investor has full right, power, authority and capacity
to enter into this Agreement and to consummate the transactions contemplated
hereby and has taken all necessary action to authorize the execution, delivery
and performance of this Agreement, and (ii) this Agreement constitutes a valid
and binding obligation of the Investor enforceable against the Investor in
accordance with its terms, except as enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws affecting
creditors' and contracting parties' rights generally and except as
enforceability may be subject to general principles of equity (regardless of
whether such enforceability is considered in a proceeding in equity or at law)
and except as rights to indemnity may be limited by state or federal securities
laws or public policy underlying such laws.
5.5 Investor will not, prior to the effectiveness of the Registration
Statement, sell, offer to sell, solicit offers to buy, dispose of, loan, pledge
or grant any right with respect to (collectively, a "Disposition"), the Shares
if doing so would be in violation of applicable securities laws, nor will
Investor engage in any hedging or other transaction which is designed to or
could reasonably be expected to lead to or result in a Disposition of the Shares
by the Investor or any other person or entity. Such prohibited hedging or other
transactions would include, without limitation, effecting any short sale or
having in effect any short position (whether or not such sale or position is
against the box and regardless of when such position was entered into) or any
purchase, sale or grant of any right (including, without limitation, any put or
call option) with respect to the Shares or with respect to any security (other
than a broad-based market basket or index) that includes, relates to or derives
any significant part of its value from the Shares.
5.6 The Investor understands that nothing in this Agreement or any other
materials presented to the Investor in connection with the purchase and sale of
the Shares constitutes legal, tax or investment advice. The Investor has
consulted such legal, tax and investment advisors as it, in its sole discretion,
has deemed necessary or appropriate in connection with its purchase of Shares.
6. Survival of Representations, Warranties and Agreements. Notwithstanding any
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investigation made by any party to this Agreement or by the Placement Agent, all
covenants, agreements, representations and warranties made by the Company and
the Investor herein shall survive the execution of this Agreement, the delivery
to the Investor of the Shares being purchased and the payment therefor.
7. Registration of the Shares; Compliance with the Securities Act.
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7.1 Registration Procedures and Expenses. The Company shall:
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(a) prepare and file with the SEC, within 90 days after the Closing
Date, a registration statement on Form S-3 (the "Registration Statement"), to
enable the resale of the Shares by the Investors from time to time on a
national securities exchange or in privately-negotiated transactions;
(b) use its reasonable best efforts, subject to receipt of necessary
information from the Investors, to cause the Registration Statement to become
effective as soon as practicable, but in no event later than 150 days after the
Closing Date;
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(c) use its reasonable best efforts to prepare and file with the SEC
such amendments and supplements to the Registration Statement and the
Prospectus used in connection therewith as may be necessary to keep the
Registration Statement current and effective for a period not exceeding, with
respect to the Investor's Shares purchased hereunder, the earlier of (i) the
second anniversary of the Closing Date, (ii) the date on which the Investor may
sell all Shares then held by the Investor without restriction by the volume
limitations of Rule 144(e) of the Securities Act, or (iii) such time as all
Shares purchased by such Investor in this Offering have been sold pursuant to a
registration statement;
(d) furnish to the Investor with respect to the Shares registered
under the Registration Statement such number of copies of the Registration
Statement, Prospectuses and Preliminary Prospectuses in conformity with the
requirements of the Securities Act and such other documents as the Investor may
reasonably request, in order to facilitate the public sale or other disposition
of all or any of the Shares by the Investor, provided, however, that the
obligation of the Company to deliver copies of Prospectuses or Preliminary
Prospectuses to the Investor shall be subject to the receipt by the Company of
reasonable assurances from the Investor that the Investor will comply with the
applicable provisions of the Securities Act and of such other securities or
blue sky laws as may be applicable in connection with any use of such
Prospectuses or Preliminary Prospectuses;
(e) file documents required of the Company for normal blue sky
clearance in states specified in writing by the Investor, provided, however,
that the Company shall not be required to qualify to do business or consent to
service of process in any jurisdiction in which it is not now so qualified or
has not so consented;
(f) bear all expenses in connection with the procedures in paragraph
(a) through (e) of this Section 7.1 and the registration of the Shares pursuant
to the Registration Statement; and
(g) advise the Investors promptly after it shall receive notice or
obtain knowledge of the issuance of any stop order by the SEC delaying or
suspending the effectiveness of the Registration Statement or of the initiation
of any proceeding for that purpose; and the Company will promptly use its
reasonable efforts to prevent the issuance of any stop order or to obtain its
withdrawal at the earliest possible moment if such stop order should be issued.
(h) With a view to making available to the Investor the benefits of
Rule 144 (or its successor rule) and any other rule or regulation of the SEC
that may at any time permit the Investor to sell Shares to the public without
registration, the Company covenants and agrees to: (i) make and keep public
information available, as those terms are understood and defined in Rule 144,
until the earlier of (A) such date as all of the Investor's Shares may be
resold pursuant to Rule 144(k) or any other rule of similar effect or (B) such
date as all of the Investor's Shares shall have been resold; (ii) file with the
SEC in a timely manner all reports and other documents required of the Company
under the Exchange Act; and (iii) furnish to the Investor upon request, as long
as the Investor owns any Shares, (A) a written statement by the Company that it
has complied with the reporting requirements of the Exchange Act, (B) a copy of
the Company's most recent Annual Report on Form 10-K or Quarterly Report on
Form 10-Q, and (C) such other information as may be reasonably requested in
order to avail the Investor of any rule or regulation of the SEC that permits
the selling of any such Shares without registration.
The Company understands that the Investor disclaims being an underwriter,
but the Investor being deemed an underwriter by the SEC shall not relieve the
Company of any obligations it has hereunder, provided, however, that if the
Company receives notification from the SEC that the Investor is deemed an
underwriter, then the period by which the Company is obligated to submit an
acceleration request to the SEC shall be extended to the earlier of (i) the 90th
day after such SEC notification, or (ii) 150 days after the initial filing of
the Registration Statement with the SEC.
7.2 Transfer of Shares After Registration; Suspension.
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(a) The Investor agrees that it will not effect any Disposition of the
Shares or its right to purchase the Shares that would constitute a sale within
the meaning of the Securities Act except as contemplated in the Registration
Statement referred to in Section 7.1 and as described below, and that it will
promptly notify the Company of any changes in the information set forth in the
Registration Statement regarding the Investor or its plan of distribution.
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(b) Except in the event that paragraph (c) below applies, the Company
shall: (i) if deemed necessary by the Company, prepare and file from time to
time with the SEC a post-effective amendment to the Registration Statement or a
supplement to the related Prospectus or a supplement or amendment to any
document incorporated therein by reference or file any other required document
so that such Registration Statement 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, and so that, as
thereafter delivered to purchasers of the Shares being sold thereunder, such
Prospectus will not contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading; (ii) provide the Investor copies of any documents filed pursuant
to Section 7.2(b)(i); and (iii) inform each Investor that the Company has
complied with its obligations in Section 7.2(b)(i) (or that, if the Company has
filed a post-effective amendment to the Registration Statement which has not yet
been declared effective, the Company will notify the Investor to that effect,
will use its reasonable efforts to secure the effectiveness of such post-
effective amendment as promptly as possible and will promptly notify the
Investor pursuant to Section 7.2(b)(i) hereof when the amendment has become
effective).
(c) Subject to paragraph (d) below, in the event: (i) of any request by
the SEC or any other federal or state governmental authority during the period
of effectiveness of the Registration Statement for amendments or supplements to
a Registration Statement or related Prospectus or for additional information;
(ii) of the issuance by the SEC or any other federal or state governmental
authority of any stop order suspending the effectiveness of a Registration
Statement or the initiation of any proceedings for that purpose; (iii) of the
receipt by the Company of any notification with respect to the suspension of the
qualification or exemption from qualification of any of the Shares for sale in
any jurisdiction or the initiation of any proceeding for such purpose; or (iv)
of any event or circumstance which necessitates the making of any changes in the
Registration Statement or Prospectus, or any document incorporated or deemed to
be incorporated therein by reference, so that, in the case of the Registration
Statement, it will not contain any untrue statement of a material fact or any
omission to state a material fact required to be stated therein or necessary to
make the statements therein not misleading, and that in the case of the
Prospectus, it will not contain any untrue statement of a material fact or any
omission to state a material fact required to be stated therein or necessary to
make the statements therein, in the light of the circumstances under which they
were made, not misleading; then the Company shall deliver a notice in writing to
the Investor (the "Suspension Notice") to the effect of the foregoing and, upon
receipt of such Suspension Notice, the Investor will refrain from selling any
Shares pursuant to the Registration Statement (a "Suspension") until the
Investor's receipt of copies of a supplemented or amended Prospectus prepared
and filed by the Company, or until it is advised in writing by the Company that
the current Prospectus may be used, and has received copies of any additional or
supplemental filings that are incorporated or deemed incorporated by reference
in any such Prospectus. In the event of any Suspension, the Company will use its
reasonable efforts to cause the use of the Prospectus so suspended to be resumed
as soon as reasonably practicable.
(d) Provided that a Suspension is not then in effect, the Investor may
sell Shares under the Registration Statement, provided that it arranges for
delivery of a current Prospectus to the transferee of such Shares (or arranges
for delivery of such to the transferee's broker). Upon receipt of a written
request therefor, the Company has agreed to provide an adequate number of
current Prospectuses to the Investor and to supply copies to any other parties
requiring such Prospectuses.
(e) In the event of a sale of Shares by the Investor, the Investor must
also deliver to the Company's transfer agent, with a copy to the Company, a
Certificate of Subsequent Sale substantially in the form attached as Exhibit B
hereto, so that the Shares may be properly transferred.
7.3 Piggy back Registrations. (a) The Company shall use its best efforts
to notify all Investors in writing at least twenty (20) days before filing any
registration statement under the Securities Act for purposes of effecting an
underwritten public offering by the Company of securities of the Company
(excluding registration statements relating to any employee benefit plan or a
corporate merger, acquisition or reorganization, or any Form S-3 similar shelf
registration statements relating to the non-underwritten offer and sale of
securities for the account of persons or entities other than the Company) and
will afford each such Investor an opportunity to include in such registration
statement all or any part of the Shares then held by such Investor. Each
Investor desiring to include in any such registration statement all or any part
of the Shares held by such Investor shall, within ten (10) days after receipt of
the above-described notice from the Company, so notify the Company in writing,
and in such notice shall inform the Company of the number of Shares such
Investor wishes to include in such registration statement. If an Investor
8
decides not to include all of its Shares in any such registration statement
filed by the Company, such Investor shall nevertheless continue to have the
right to include any Shares in any subsequent registration statement or
registration statements as may be filed by the Company with respect to offerings
of its securities as described above, all upon the terms and conditions set
forth herein. The Investors' rights to include any Shares in any offering under
this Section are subject in all events to the ability of the managing
underwriter for such offering to exclude some or all of the Shares requested to
be registered on the basis of a good faith determination that inclusion of such
securities might adversely affect the success of the offering or otherwise
adversely affect the Company. Any such exclusion shall be pro rata among all
Investors who have requested to sell Shares in such registration.
(b) Underwriting. If a registration statement under which the Company
gives notice under this Section is for an underwritten offering, then the
Company shall so advise the Investors . In such event, the right of any such
Investor's Shares to be included in a registration pursuant to this Section
shall be conditioned upon such Investor's participation in such underwriting and
the inclusion of such Investor's Shares in the underwriting to the extent
provided herein. All Investors proposing to distribute their Shares through such
underwriting shall enter into an underwriting agreement in customary form with
the managing underwriter or underwriters selected for such underwriting and
shall furnish such information and documents as the Company or the managing
underwriter or underwriters may reasonably request. Notwithstanding any other
provision of this Agreement, if the managing underwriter determine(s) in good
faith that marketing factors require a limitation of the number of shares to be
underwritten, then the managing underwriter(s) may exclude Shares from the
registration and the underwriting, pro rata among all Investors who have
requested to sell Shares in such registration. If any Investor disapproves of
the term of any such underwriting, such Investor may elect to withdraw therefrom
by written notice to the Company and the underwriter, delivered at least ten
(10) business days prior to the effective date of the registration statement.
Any Shares excluded or withdrawn from such underwriting shall be excluded and
withdrawn from the registration.
(c) Expenses. The Investors shall be responsible for their pro rata share
of registration fees and underwriters' and brokers' discounts and commissions
relating to any Shares included in such registration and for fees for their
counsel. Other registration expenses (such as legal and accounting fees of
counsel to the Company, printing fees, road show expenses, and the like) shall
be borne by the Company.
(d) Number of Piggyback Registrations. The piggyback registration rights
granted to the Investors under this Section shall apply to the first three
registrations of the type described in Section 7.3(a) filed by the Company after
the Closing.
7.4 Indemnification. For the purpose of this Section 7.4: (i) the term
---------------
"Selling Stockholder" shall include the Investor and any officer, director, each
person who controls such Investor within the meaning of Section 15 of the
Securities Act, any affiliate of such Investor; (ii) the term "Registration
Statement" shall include any final Prospectus, exhibit, supplement or amendment
included in or relating to the Registration Statement referred to in Section
7.1; and (iii) the term "untrue statement" shall include any untrue statement or
alleged untrue statement, or any omission or alleged omission to state in the
Registration Statement a material fact required to be stated therein or
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading.
(a) The Company agrees to indemnify and hold harmless each Selling
Stockholder from and against any losses, claims, damages or liabilities to
which such Selling Stockholder may become subject (under the Securities Act or
otherwise) insofar as such losses, claims, damages or liabilities (or actions
or proceedings in respect thereof) arise out of, or are based upon (i) any
untrue statement of a material fact contained in the Registration Statement, or
(ii) any failure by the Company to fulfill any undertaking included in the
Registration Statement, and the Company will reimburse such Selling Stockholder
for any legal or other expenses reasonably incurred in investigating, defending
or preparing to defend any such action, proceeding or claim; provided, however,
-------- -------
that the Company shall not be liable in any such case to the extent that such
loss, claim, damage or liability arises out of, or is based upon, an untrue
statement made in such Registration Statement in reliance upon and in
conformity with written information furnished to the Company by or on behalf of
such Selling Stockholder or the failure of such Selling Stockholder to comply
with its covenants and agreements contained in Sections 5 or 7.2 hereof or any
statement or omission in any Prospectus that is corrected in any subsequent
Prospectus that was delivered to the Investor prior to the pertinent sale or
sales by the Investor.
9
(b) The Investor agrees to severally indemnify and hold harmless the
Company (and each person, if any, who controls the Company within the meaning
of Section 15 of the Securities Act, each officer of the Company, each director
of the Company and any affiliate of the Company) from and against any losses,
claims, damages or liabilities to which the Company (or any such officer,
director, controlling person or affiliate) may become subject (under the
Securities Act or otherwise), insofar as such losses, claims, damages or
liabilities (or actions or proceedings in respect thereof) arise out of, or are
based upon, (i) any failure to comply with the covenants and agreements
contained in Sections 5 or 7.2 hereof, or (ii) any untrue statement of a
material fact contained in the Registration Statement if such untrue statement
was made in reliance upon and in conformity with written information furnished
by or on behalf of the Investor, and the Investor will reimburse the Company
(or such officer, director, controlling person or affiliate), as the case may
be, for any legal or other expenses reasonably incurred in investigating,
defending or preparing to defend any such action, proceeding or claim.
(c) Promptly after receipt by any indemnified person of a notice of a
claim or the beginning of any action in respect of which indemnity is to be
sought against an indemnifying person pursuant to this Section 7.4, such
indemnified person shall notify the indemnifying person in writing of such
claim or of the commencement of such action, but the omission to so notify the
indemnifying party will not relieve it from any liability which it may have to
any indemnified party under this Section 7.4 (except to the extent that such
omission materially and adversely affects the indemnifying party's ability to
defend such action) or from any liability otherwise than under this Section
7.4. Subject to the provisions hereinafter stated, in case any such action
shall be brought against an indemnified person, the indemnifying person shall
be entitled to participate therein, and, to the extent that it shall elect by
written notice delivered to the indemnified party promptly after receiving the
aforesaid notice from such indemnified party, shall be entitled to assume the
defense thereof, with counsel reasonably satisfactory to such indemnified
person. After notice from the indemnifying person to such indemnified person of
its election to assume the defense thereof, such indemnifying person shall not
be liable to such indemnified person for any legal expenses subsequently
incurred by such indemnified person in connection with the defense thereof,
provided, however, that if there exists or shall exist a conflict of interest
that would preclude, in the reasonable opinion of counsel to the indemnified
person, the same counsel from representing both the indemnified person and such
indemnifying person or any affiliate or associate thereof, the indemnified
person shall be entitled to retain its own counsel at the reasonable expense of
such indemnifying person; provided, however, that no indemnifying person shall
-------- -------
be responsible for the fees and expenses of more than one separate counsel
(together with appropriate local counsel) for all indemnified parties. In no
event shall any indemnifying person be liable in respect of any amounts paid in
settlement of any action unless the indemnifying person shall have approved the
terms of such settlement; provided that such consent shall not be unreasonably
--------
withheld. No indemnifying person shall, without the prior written consent of
the indemnified person, effect any settlement of any pending or threatened
proceeding in respect of which any indemnified person is or could have been a
party and indemnification could have been sought hereunder by such indemnified
person, unless such settlement includes an unconditional release of such
indemnified person from all liability on claims that are the subject matter of
such proceeding.
(d) If the indemnification provided for in this Section 7.4 is unavailable
to or insufficient to hold harmless an indemnified party under subsection (a)
or (b) above in respect of any losses, claims, damages or liabilities (or
actions or proceedings in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities
(or actions in respect thereof) in such proportion as is appropriate to reflect
the relative fault of the Company on the one hand and the Investors on the
other in connection with the statements or omissions or other matters which
resulted in such losses, claims, damages or liabilities (or actions in respect
thereof), as well as any other relevant equitable considerations. The relative
fault shall be determined by reference to, among other things, in the case of
an untrue statement, whether the untrue statement relates to information
supplied by the Company on the one hand or the Investor on the other and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such untrue statement. The Company and the Investors agree
that it would not be just and equitable if contribution pursuant to this
subsection (d) were determined by pro rata allocation (even if the Investors
were treated as one entity for such purpose) or by any other method of
allocation which does not take into account the equitable considerations
referred to above in this subsection (d). The amount paid or payable by an
indemnified party as a result of the losses, claims, damages or liabilities (or
actions in respect thereof) referred to above in this subsection (d) shall be
deemed to include any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any such action
or claim. Notwithstanding the provisions of this subsection (d), the Investor
shall not be required to contribute any
10
amount in excess of the amount by which the gross amount received by the
Investor from the sale of the Shares to which such loss relates exceeds the
amount of any damages which such Investor has otherwise been required to pay by
reason of such untrue statement. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Investors' obligations in this subsection to
contribute are several in proportion to their sales of Shares to which such
loss relates and not joint.
(e) The parties to this Agreement hereby acknowledge that they are
sophisticated business persons who were represented by counsel during the
negotiations regarding the provisions hereof including, without limitation, the
provisions of this Section 7.4, and are fully informed regarding said
provisions. They further acknowledge that the provisions of this Section 7.4
fairly allocate the risks in light of the ability of the parties to investigate
the Company and its business in order to assure that adequate disclosure is
made in the Registration Statement as required by the Securities Act and the
Exchange Act. The parties are advised that federal or state public policy as
interpreted by the courts in certain jurisdictions may be contrary to certain
of the provisions of this Section 7.4, and the parties hereto hereby expressly
waive and relinquish any right or ability to assert such public policy as a
defense to a claim under this Section 7.4 and further agree not to attempt to
assert any such defense.
7.5 Termination of Conditions and Obligations. The conditions precedent
-----------------------------------------
imposed by Section 5 or this Section 7 upon the transferability of the Shares
shall cease and terminate as to any particular number of the Shares when such
Shares shall have been effectively registered under the Securities Act and sold
or otherwise disposed of in accordance with the intended method of disposition
set forth in the Registration Statement covering such Shares or at such time as
an opinion of counsel satisfactory to the Company shall have been rendered to
the effect that such conditions are not necessary in order to comply with the
Securities Act.
8. Notices. All notices, requests, consents and other communications hereunder
-------
shall be in writing, shall be mailed (A) if within domestic United States by
first-class registered or certified airmail, or nationally recognized overnight
express courier, postage prepaid, or by facsimile, or (B) if delivered from
outside the United States, by International Federal Express or facsimile, and
shall be deemed given (i) if delivered by first-class registered or certified
mail domestic, three business days after so mailed, (ii) if delivered by
nationally recognized overnight carrier, one business day after so mailed, (iii)
if delivered by International Federal Express, two business days after so
mailed, (iv) if delivered by facsimile, upon electric confirmation of receipt
and shall be delivered as addressed as follows:
(a) if to the Company, to:
Hanover Compressor Company
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
With a copy to:
▇▇▇▇▇▇ & ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
(b) if to the Investor, at its address on the signature page
hereto, or at such other address or addresses as may have been furnished to the
Company in writing in accordance with this Section 8.
9. Publicity. The Company will not issue any public statement, press release or
---------
any other public disclosure, that includes either of the Investors' names,
without such Investor's prior written consent. If the Company is required by an
applicable law, regulation, or securities exchange rule to disclose either of
the Investor's names, the Company will give the Investor reasonable notice of
the required disclosure.
11
10. Changes. This Agreement may not be modified or amended except pursuant to
-------
an instrument in writing signed by the Company and the Investor.
11. Headings. The headings of the various sections of this Agreement have been
--------
inserted for convenience of reference only and shall not be deemed to be part of
this Agreement.
12. Severability. In case any provision contained in this Agreement should be
------------
invalid, illegal or unenforceable in any respect, the validity, legality and
enforceability of the remaining provisions contained herein shall not in any way
be affected or impaired thereby.
13. Governing Law. This Agreement shall be governed by, and construed in
-------------
accordance with, the laws of the State of New York, without giving effect to any
choice of law provisions thereof, and the federal law of the United States of
America.
14. Counterparts. This Agreement may be executed in two or more counterparts,
------------
each of which shall constitute an original, but all of which, when taken
together, shall constitute but one instrument.
12
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly-authorized representatives shown below.
Janus Investment Fund on behalf of its
--------------------------------------
series Janus Enterprise Fund
----------------------------
"INVESTOR"
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------
Print Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------
Title: Vice President
--------------
Address: ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
-------------------
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
----------------
Number of Shares: 551,875
-------
Aggregate Purchase Price $33,112,500
-----------
Tax ID No.: ▇▇-▇▇▇▇▇▇▇
----------
Contact name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
--------------
Name in which shares should be
registered (if different): Newsworthy & Co.
----------------
Accepted and Agreed to by:
HANOVER COMPRESSOR COMPANY:
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-----------------------
Title: EVP
Date: 5/23/00
13
Exhibit A
---------
INVESTOR QUESTIONNAIRE
(ALL INFORMATION WILL BE TREATED CONFIDENTIALLY)
To: Hanover Compressor Company
This Investor Questionnaire ("Questionnaire") must be completed by each
potential investor in connection with the offer and sale of the shares of the
common stock, par value $.001 per share, of the Company (the "Shares"). The
Shares are being offered and sold by the Company without registration under the
Securities Act of 1933, as amended (the "Securities Act"), and the securities
laws of certain states, in reliance on the exemptions contained in Section 4(2)
of the Securities Act and on Regulation D promulgated thereunder and in reliance
on similar exemptions under applicable state laws. The Company must determine
that a potential investor meets certain suitability requirements before offering
or selling Shares to such investor. The purpose of this Questionnaire is to
assure the Company that each investor will meet the applicable suitability
requirements. The information supplied by you will be used in determining
whether you meet such criteria, and reliance upon the private offering
exemptions from registration is based in part on the information herein
supplied.
This Questionnaire does not constitute an offer to sell or a solicitation of
an offer to buy any security. Your answers will be kept strictly confidential.
However, by signing this Questionnaire, you will be authorizing the Company to
provide a completed copy of this Questionnaire to such parties as the Company
deems appropriate in order to ensure that the offer and sale of the Shares will
not result in a violation of the Securities Act or the securities laws of any
state and that you otherwise satisfy the suitability standards applicable to
purchasers of the Shares. All potential investors must answer all applicable
questions and complete, date and sign this Questionnaire. Please print or type
your responses and attach additional sheets of paper if necessary to complete
your answers to any item.
A. BACKGROUND INFORMATION
----------------------
Name: Janus Investment Fund on behalf of its series Janus Enterprise Fund
-------------------------------------------------------------------
Business Address: ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
--------------------------------------
Telephone Number: (▇▇▇) ▇▇▇-▇▇▇▇
--------------
Residence Address:______________________________________________________________
(Number and Street)
________________________________________________________________________________
(City) (State) (Zip Code)
Telephone Number: (___)_________________________________________________________
If an individual:
Age: __________ Citizenship: __________ Where registered to vote: ____________
If a corporation, partnership, limited liability company, trust or other entity:
Type of entity: Business Trust
--------------
State of formation: Massachusetts_ Date of formation: August 28, 1981-
----------------
Social Security or Taxpayer Identification No. ▇▇-▇▇▇▇▇▇▇
----------
Send all correspondence to (check one): ____ Residence Address X Business
-----
Address
B. STATUS AS ACCREDITED INVESTOR
-----------------------------
1
The undersigned is an "accredited investor" as such term is defined in
Regulation D under the Securities Act, as at the time of the sale of the Shares
the undersigned falls within one or more of the following categories (Please
------
initial one or more, as applicable): /1/
----------------------------------
X (1) a bank as defined in Section 3(a)(2) of the Securities Act, or a
-----
savings and loan association or other institution as defined in Section
3(a)(5)(A) of the Securities Act whether acting in its individual or fiduciary
capacity; a broker or dealer registered pursuant to Section 15 of the Securities
Exchange Act of 1934; an insurance company as defined in Section 2(13) of the
Securities Act; an investment company registered under the Investment Company
Act of 1940 or a business development company as defined in Section 2(a)(48) of
that Act; a Small Business Investment Company licensed by the U.S. Small
Business Administration under Section 301(c) or (d) of the Small Business
Investment Act of 1958; a plan established and maintained by a state, its
political subdivisions, or any agency or instrumentality of a state or its
political subdivisions for the benefit of its employees, if such plan has total
assets in excess of $5,000,000; an employee benefit plan within the meaning of
the Employee Retirement Income Security Act of 1974, if the investment decision
is made by a plan fiduciary, as defined in Section 3(21) of such Act, which is
either a bank, savings and loan association, insurance company, or registered
investment adviser, or if the employee benefit plan has total assets in excess
of $5,000,000 or, if a self-directed plan, with the investment decisions made
solely by persons that are accredited investors;
____ (2) a private business development company as defined in Section
202(a)(22) of the Investment Advisers Act of 1940;
____ (3) an organization described in Section 501(c)(3) of the Internal
Revenue Code of 1986, as amended, corporation, Massachusetts or similar business
trust, or partnership, not formed for the specific purpose of acquiring the
Shares offered, with total assets in excess of $5,000,000;
____ (4) a natural person whose individual net worth, or joint net worth with
that person's spouse, at the time of such person's purchase of the Shares
exceeds $1,000,000;
____ (5) a natural person who had an individual income in excess of $200,000
in each of the two most recent years or joint income with that person's spouse
in excess of $300,000 in each of those years and has a reasonable expectation of
reaching the same income level in the current year;
____ (6) a trust, with total assets in excess of $5,000,000, not formed for
the specific purpose of acquiring the Shares offered, whose purchase is directed
by a sophisticated person as described in Rule 506(b)(2)(ii) of Regulation D;
and
____ (7) an entity in which all of the equity owners are accredited investors
(as defined above).
----------------------
/1/ As used in this Questionnaire, the term "net worth" means the excess
of total assets over total liabilities.
2
C. REPRESENTATIONS
---------------
The undersigned hereby represents and warrants to the Company as follows:
1. Any purchase of the Shares would be solely for the account of the
undersigned and not for the account of any other person or with a view to any
resale, fractionalization, division, or distribution thereof.
2. The information contained herein is complete and accurate and may be relied
upon by the Company, and the undersigned will notify the Company immediately of
any material change in any of such information occurring prior to the closing,
if any, with respect to the purchase of Shares by the undersigned or any co-
purchaser.
3. There are no suits, pending litigation, or claims against the undersigned
that could materially affect the net worth of the undersigned as reported in
this Questionnaire.
4. The undersigned acknowledges that there may occasionally be times when the
Company, based on the advice of its counsel, determines that it must suspend the
use of the Prospectus forming a part of the Registration Statement (as such
terms are defined in the Purchase Agreement to which this Questionnaire is
attached) until such time as an amendment to the Registration Statement has been
filed by the Company and declared effective by the Securities and Exchange
Commission or until the Company has amended or supplemented such Prospectus.
The undersigned is aware that, in such event, the Shares will not be subject to
ready liquidation, and that any Shares purchased by the undersigned would have
to be held during such suspension. The overall commitment of the undersigned to
investments which are not readily marketable is not excessive in view of the
undersigned's net worth and financial circumstances, and any purchase of the
Shares will not cause such commitment to become excessive. The undersigned is
able to bear the economic risk of an investment in the Shares.
5. In addition to reviewing the Offering Materials (as defined in the Purchase
Agreement to which this Questionnaire is attached), the undersigned has
carefully considered the potential risks relating to the Company and a purchase
of the Shares, and fully understands that the Shares are speculative investments
which involve a high degree of risk of loss of the undersigned's entire
investment. Among others, the undersigned has carefully considered each of the
risks described in the Offering Materials.
6. Except as set forth below, (a) the undersigned has had no position, office
or other material relationship currently or within the past three years with the
Company or its affiliates, (b) neither it, nor any group of which it is a member
or to which it is related, beneficially owns (including the right to acquire or
vote) any securities of the Company and (c) it has no direct or indirect
affiliation or association with any NASD member. Exceptions:
Janus Funds Distributor, Inc., a limited purpose broker dealer
--------------------------------------------------------------
(If no exceptions, write "none." If left blank, response will be deemed to
be "none.")
IN WITNESS WHEREOF, the undersigned has executed this Questionnaire this 19th
day of May, 2000, and declares under oath that it is truthful and correct.
▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------------
Print Name
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------
Signature
Title: Vice President
-------------------------------
(required for any purchaser that is a
corporation, partnership, trust or other
entity)
3
Exhibit B
---------
CERTIFICATE OF SUBSEQUENT SALE
------------------------------
[Transfer Agent]
RE: Sale of Shares of Common Stock of the Company pursuant to the
Company's Prospectus dated __________, 2000 (the "Prospectus")
Dear Sir/Madam:
The undersigned hereby certifies, in connection with the sale of shares of
Common Stock of the Company included in the table of Selling Shareholders in the
Prospectus, that the undersigned has sold the shares pursuant to the Prospectus
and in a manner described under the caption "Plan of Distribution" in the
Prospectus and that such sale complies with all applicable securities laws,
including, without limitation, the Prospectus delivery requirements of the
Securities Act of 1933, as amended.
Selling Shareholder (the beneficial owner): ____________________________________
Record Holder (e.g., if held in name of nominee): ______________________________
Restricted Stock Certificate No.(s): ___________________________________________
Number of Shares Sold: _________________________________________________________
Date of Sale: __________________________________________________________________
In the event that you receive a stock certificate(s) representing more
shares of Common Stock than have been sold by the undersigned, then you should
return to the undersigned a newly issued certificate for such excess shares in
the name of the Record Holder and BEARING A RESTRICTIVE LEGEND. Further, you
should place a stop transfer on your records with regard to such certificate.
Very truly yours,
Dated: _______________________ By: ________________________________
Print Name: ________________________
Title: _____________________________