CONSOLIDATED CIGAR HOLDINGS INC.
CLASS A COMMON STOCK
(PAR VALUE $.01 PER SHARE)
--------------------------
UNDERWRITING AGREEMENT
(U.S. VERSION)
--------------------------
March , 1997
Xxxxxxx, Xxxxx & Co.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated
Xxxxxx Xxxxxxx & Co. Incorporated
As representatives of the several Underwriters
named in Schedule I hereto,
c/o Goldman, Sachs & Co.
00 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Mafco Consolidated Group Inc., a Delaware corporation (the "Selling
Stockholder"), proposes, subject to the terms and conditions stated herein,
to sell to the Underwriters named in Schedule I hereto (the "Underwriters")
an aggregate of 4,000,000 shares (the "Firm Shares") and, at the election of
the Underwriters, up to 600,000 additional shares (the "Optional Shares") of
Class A Common Stock, par value $.01 per share ("Stock"), of Consolidated
Cigar Holdings Inc., a Delaware corporation (the "Company") (the Firm Shares
and the Optional Shares that the Underwriters elect to purchase pursuant to
Section 2 hereof being collectively called the "Shares").
It is understood and agreed to by all parties that the Company and the
Selling Stockholder are concurrently entering into an agreement (the
"International Underwriting Agreement") providing for the sale by the Selling
Stockholder of up to a total of 1,150,000 shares of Stock (the "International
Shares"), including the over-allotment option thereunder, through
arrangements with certain underwriters outside the United States (the
"International Underwriters"), for whom Xxxxxxx Xxxxx International, Xxxxxxx
Xxxxx International and Xxxxxx Xxxxxxx & Co. International Limited are acting
as lead managers. Anything herein or therein to the contrary notwithstanding,
the respective closings under this Agreement and the International
Underwriting Agreement are hereby expressly made conditional on one another.
The Underwriters hereunder and the International Underwriters are
simultaneously entering into an Agreement between U.S. and International
Underwriting Syndicates (the "Agreement between Syndicates") which provides,
among other things, for the transfer of shares of Stock between the two
syndicates. Two forms of prospectus are to be used in connection with the
offering and sale of shares of Stock contemplated by the foregoing, one
relating to the Shares hereunder and the other relating to the International
Shares. The latter form of prospectus will be identical to the former except
for certain substitute pages as included in the registration statement and
amendments thereto as mentioned below. Except as used in Sections 2, 3, 4, 9
and 11 herein, and except as the context may otherwise require, references
hereinafter to the Shares shall include all the shares of Stock which may be
sold pursuant to either this Agreement or the International Underwriting
Agreement, and references herein to any prospectus whether in preliminary or
final form, and whether as amended or supplemented, shall include both the
U.S. and the international versions thereof.
1. (a) The Company represents and warrants to, and agrees with, each of
the Underwriters that:
(i) A registration statement on Form S-1 (File No. 333-20743) (the
"Initial Registration Agreement") in respect of the Shares has been filed
with the Securities and Exchange Commission (the "Commis-
sion"); the Initial Registration Statement and any post-effective amendment
thereto, each in the form heretofore delivered to you, and, excluding
exhibits thereto, to you for each of the other Underwriters, have been
declared effective by the Commission in such form; other than a registration
statement, if any, increasing the size of the offering (a "Rule 462(b)
Registration Statement"), filed pursuant to Rule 462(b) under the Securities
Act of 1933, as amended (the "Act"), which became effective upon filing, no
other document with respect to the Initial Registration Statement has
heretofore been filed with the Commission; and no stop order suspending the
effectiveness of the Initial Registration Statement, any post-effective
amendment thereto or the Rule 462(b) Registration Statement, if any, has been
issued and no proceeding for that purpose has been initiated or threatened by
the Commission (any preliminary prospectus included in the Initial
Registration Statement or filed with the Commission pursuant to Rule 424(a)
of the rules and regulations of the Commission under the Act, is hereinafter
called a "Preliminary Prospectus"; the various parts of the Initial
Registration Statement and the Rule 462(b) Registration Statement, if any,
including all exhibits thereto and including the information contained in the
form of final prospectus filed with the Commission pursuant to Rule 424(b)
under the Act in accordance with Section 5(a) hereof and deemed by virtue of
Rule 430A under the Act to be part of the Initial Registration Statement at
the time it was declared effective or such part of the Rule 462(b)
Registration Statement, if any, became or hereafter becomes effective, each
as amended at the time such part of the registration statement became
effective, are hereinafter collectively called the "Registration Statement";
and such final prospectus, in the form first filed pursuant to Rule 424(b)
under the Act, is hereinafter called the "Prospectus";
(ii) No order preventing or suspending the use of any Preliminary
Prospectus has been issued by the Commission, and the Preliminary Prospectus
dated February 28, 1997, at the time of filing thereof, conformed in all
material respects to the requirements of the Act and the rules and
regulations of the Commission thereunder, and, as of its date, 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 the light of the circumstances under which they were made, not
misleading; provided, however, that this representation and warranty shall
not apply to any statements in or omissions from the Preliminary Prospectus
made in reliance upon and in conformity with information furnished in writing
to the Company by an Underwriter through Xxxxxxx, Sachs & Co. expressly for
use therein;
(iii) The Registration Statement conforms, and the Prospectus and any
further amendments or supplements to the Registration Statement or the
Prospectus will conform, in all material respects to the requirements of the
Act and the rules and regulations of the Commission thereunder and do not and
will not, as of the applicable effective date as to the Registration
Statement and any amendment thereto and as of the applicable filing date as
to the Prospectus and any amendment or supplement thereto, contain an untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not misleading;
provided, however, that this representation and warranty shall not apply to
any statements in or omissions from the Registration Statement or the
Prospectus made in reliance upon and in conformity with information furnished
in writing to the Company by an Underwriter through Xxxxxxx, Xxxxx & Co.
expressly for use therein;
(iv) Neither the Company nor any of its significant subsidiaries (as
defined in Rule 1-02(w) of Regulation S-X of the Commission) and each
subsidiary of the Company which is subject to material contracts (each of
such corporations or other legal entities being hereinafter referred to as a
"Subsidiary" and all such corporations or other legal entities being,
collectively, the "Subsidiaries") has sustained since the date of the latest
audited financial statements included in the Prospectus any loss or
interference with its business from fire, explosion, flood or other calamity,
whether or not covered by insurance, or from any labor dispute or court or
governmental action, order or decree, otherwise than as set forth in or
contemplated by the Prospectus and other than such losses or interferences
which would not, individually or in the aggregate, have a material adverse
effect on the condition, financial or otherwise, earnings, business affairs
or business prospects of the Company and its subsidiaries considered as one
enterprise, whether or not arising in the ordinary course of business (a
"Material Adverse Effect"); and, since the respective dates as of which
information is given in the Registration Statement and the Prospectus, there
has not been any change in the capital stock or long-term debt of
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the Company or any of its Subsidiaries or any material adverse change in or
affecting the business affairs, business prospects, management, consolidated
financial position, stockholders' equity or results of operations of the
Company and its Subsidiaries considered as one enterprise, in each case,
otherwise than as set forth in or contemplated by the Prospectus;
(v) The Company and its Subsidiaries have good and marketable title in fee
simple to all real property and good title to all personal property owned by
them, in each case free and clear of all liens, encumbrances and defects
except (i) such as are described in the Prospectus, (ii) liens arising under
the Credit Agreement (as such term is defined in the Prospectus) or (iii)
such as do not materially interfere with the Company's ability to conduct its
business as described in the Prospectus or with the use made and proposed to
be made of such property by the Company and its Subsidiaries; and any real
property and buildings identified in the Prospectus as held under lease by
the Company or its Subsidiaries are held by them under valid, subsisting and
enforceable leases, except where the failure to be valid, subsisting and
enforceable would not, individually or in the aggregate, be reasonably likely
to have a Material Adverse Effect;
(vi) The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Delaware with
power and authority (corporate and other) to own its properties and conduct
its business as described in the Prospectus, and has been duly qualified as a
foreign corporation for the transaction of business and is in good standing
under the laws of each other jurisdiction in which it owns or leases
properties or conducts any business so as to require such qualification,
except where the failure to be so qualified or be in good standing would not
have a Material Adverse Effect; and each Subsidiary of the Company has been
duly incorporated and is validly existing as a corporation in good standing
under the laws of its jurisdiction of incorporation, except where the failure
to be in good standing would not have a Material Adverse Effect and except
for jurisdictions not recognizing the legal concept of good standing;
(vii) The authorized, issued and outstanding capital stock of the Company
is as set forth in the Prospectus under the caption "Capitalization" (except
for the conversion of the shares of Class B Common Stock, par value $0.01 per
share (the "Class B Stock"), of the Company into the Shares to be sold by the
Selling Stockholder pursuant to this Agreement or the International
Underwriting Agreement, subsequent issuances, if any, pursuant to the
Company's stock option plan or otherwise referred to in or contemplated by
the Prospectus) and conforms to the description of the capital stock
contained in the Prospectus; the shares of issued and outstanding Stock and
Class B Stock described in the Prospectus under the caption "Capitalization"
have been duly authorized and validly issued and are fully paid and
non-assessable; and all of the issued shares of capital stock of each
Subsidiary of the Company have been duly authorized and validly issued, are
fully paid and non-assessable and (except for directors' qualifying shares
and except as set forth in or contemplated by the Prospectus) are owned
directly or indirectly by the Company, free and clear of all liens,
encumbrances, equities or claims, except for liens arising under the Credit
Agreement (as defined in the Prospectus) and related security agreements;
(viii) The compliance by the Company with all of the provisions of this
Agreement and the International Underwriting Agreement and the consummation
of the transactions herein and therein contemplated will not conflict with or
result in a breach or violation of any of the terms or provisions of, or
constitute a default under, any indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument to which the Company or any of its
Subsidiaries is a party or by which the Company or any of its Subsidiaries is
bound or to which any of the property or assets of the Company or any of its
Subsidiaries is subject, nor will such action result in any violation of the
provisions of the Amended and Restated Certificate of Incorporation (the
"Amended and Restated Certificate of Incorporation") or the Amended and
Restated By-laws of the Company (in substantially the form filed as an
exhibit to the Registration Statement (the "Amended and Restated By-laws"))
or any statute or any order, rule or regulation of any court or governmental
agency or body having jurisdiction over the Company or any of its
Subsidiaries or any of their respective properties, except for (other than in
the case of the Amended and Restated Certificate of Incorporation and the
Amended and Restated By-laws) such conflicts, breaches, violations or
defaults which would not, individually or in the aggregate, have a Material
Adverse Effect; and no consent, approval, authorization, order, registration
or qualification of or with any
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such court or governmental agency or body is required for the issue and sale
of the Shares or the consummation by the Company of the transactions
contemplated by this Agreement and the International Underwriting Agreement,
except the registration under the Act and under the Securities Exchange Act
of 1934, as amended (the "Exchange Act"), of the Shares and such consents,
approvals, authorizations, registrations or qualifications as may be required
under state or foreign securities or Blue Sky laws or by the rules and
regulations of the National Association of Securities Dealers, Inc. (the
"NASD") in connection with the purchase and distribution of the Shares by the
Underwriters and the International Underwriters;
(ix) Neither the Company nor any of its Subsidiaries is (i) in violation
of its certificate of incorporation or by-laws or similar constituent
instrument or (ii) in default in the performance or observance of any
material obligation, agreement, covenant or condition contained in any
indenture, mortgage, deed of trust, loan agreement, lease or other agreement
or instrument to which it is a party or by which it or any of its properties
may be bound, except in the case of (ii), such defaults that would not,
individually or in the aggregate, have a Material Adverse Effect;
(x) Other than as set forth in or contemplated by the Prospectus, there
are no legal or governmental proceedings pending to which the Company or any
of its Subsidiaries is a party or of which any property of the Company or any
of its Subsidiaries is the subject which would, individually or in the
aggregate, be reasonably likely to have a Material Adverse Effect; and, to
the best of the Company's knowledge, no such proceedings are threatened by
governmental authorities or by others;
(xi) No labor dispute with the employees of the Company or any of its
Subsidiaries exists or, to the knowledge of the Company, is imminent that
would be reasonably likely to have a Material Adverse Effect;
(xii) Each of the Company and its Subsidiaries (i) is in material
compliance with all applicable federal, state and local environmental laws
and regulations, including, without limitation, those applicable to human
health and safety, emissions to the environment, waste management, and waste
disposal (collectively, the "Environmental Laws"), and (ii) has received, and
is in material compliance with, all permits, licenses or other approvals
required of it under applicable Environmental Laws, except for such
noncompliance or failure to receive such license, permit or other approval as
is not reasonably likely to have a Material Adverse Effect, or except as
disclosed in the Prospectus, and to the knowledge of the Company, there are
no circumstances that would prevent, interfere with or materially increase
the cost of such compliance in the future;
(xiii) Except as disclosed in the Prospectus, there is no claim under any
Environmental Law, including common law, pending or threatened against the
Company or its Subsidiaries (an "Environmental Claim") which would be
reasonably likely to have a Material Adverse Effect and, to the knowledge of
the Company, under applicable law, there are no past or present actions,
activities, circumstances, events or incidents, including, without
limitation, releases of any material into the environment, that are
reasonably likely to form the basis of any such Environmental Claim against
the Company or its Subsidiaries, which, would be reasonably likely to have a
Material Adverse Effect;
(xiv) Each of the Company and its Subsidiaries has and will maintain
insurance covering its properties, operations, personnel and businesses,
which insurance is in amounts and insures against such losses and risks, in
each case as is in accordance with customary industry practice to protect the
Company and its Subsidiaries and their businesses;
(xv) Each of the Company and its Subsidiaries owns or possesses adequate
rights to use all patents, patent applications, trademarks, service marks,
trade names, trademark registrations, service xxxx registrations, copyrights,
licenses and know-how (including trade secrets and other unpatented or
unpatentable proprietary or confidential information, systems or procedures)
currently employed by it in connection with the business now operated by it
(the "Intellectual Property Rights"), except (i) for restrictions of
ownership, if any, arising out of the security interests in such Intellectual
Property Rights pursuant to the Credit Agreement or (ii) where the failure to
possess such Intellectual Property Rights would not be reasonably likely to
have a Material Adverse Effect; and the Company has no reason to
4
believe that the use of any of the foregoing Intellectual Property Rights by
the Company or any of its Subsidiaries will conflict with any such rights of
others which would be reasonably likely to have a Material Adverse Effect,
and has not received any actual notice of any claim of conflict with any such
rights of others which would be reasonably likely to have a Material Adverse
Effect;
(xvi) The Company is not and, after giving effect to the offering and sale
of the Shares, will not be an "investment company" or an entity "controlled"
by an "investment company", as such terms are defined in the Investment
Company Act of 1940, as amended (the "Investment Company Act");
(xvii) Neither the Company nor any of its affiliates does business with
the government of Cuba or with any person or affiliate located in Cuba within
the meaning of Section 517.075, Florida Statutes; and
(xviii) Ernst & Young LLP, who have certified certain financial statements
of the Company and its subsidiaries, are, to the best knowledge of the
Company, independent public accountants as required by the Act and the rules
and regulations of the Commission thereunder.
(b) The Selling Stockholder represents and warrants to, and agrees with,
each of the Underwriters that:
(i) The Selling Stockholder has power and authority (corporate and other)
to enter into this Agreement and the International Underwriting Agreement
and to sell, assign, transfer and deliver the Shares to be sold by the
Selling Stockholder hereunder and under the International Underwriting
Agreement;
(ii) The sale of the Shares to be sold by the Selling Stockholder
hereunder and under the International Underwriting Agreement and the
compliance by the Selling Stockholder with all of the provisions of this
Agreement and the International Underwriting Agreement and the
consummation of the transactions herein and therein contemplated will not
conflict with or result in a breach or violation of any of the terms or
provisions of, or constitute a default under, any indenture, mortgage,
deed of trust, loan agreement or other agreement or instrument to which
the Selling Stockholder is a party or by which the Selling Stockholder is
bound or to which any of the property or assets of the Selling Stockholder
is subject, nor will such action result in any violation of the provisions
of the certificate of incorporation or by-laws of the Selling Stockholder
or any statute or any order, rule or regulation of any court or
governmental agency or body having jurisdiction over the Selling
Stockholder or the property of the Selling Stockholder except for (other
than in the case of the certificate of incorporation and the by-laws) such
conflicts, breaches, violations or defaults which would not, individually
or in the aggregate, affect the validity or enforceability of, or
adversely affect the Selling Stockholder's ability to consummate, the
transactions contemplated by or perform its obligations under this
Agreement or the International Underwriting Agreement; and no consent,
approval, authorization, order, registration or qualification of or with
any such court or governmental agency or body is required for the issue
and sale of the Shares or the consummation by the Selling Stockholder of
the transactions contemplated by this Agreement and the International
Underwriting Agreement, except the registration under the Act and Exchange
Act of the Shares and such consents, approvals, authorizations,
registrations or qualifications as may be required under state or foreign
securities or Blue Sky laws or by the rules and regulations of the NASD in
connection with the purchase and distribution of the Shares by the
Underwriters and the International Underwriters;
(iii) The Selling Stockholder has, and immediately prior to the Time of
Delivery (as defined in Section 4 hereof) the Selling Stockholder will
have, good and valid title to the shares of Class B Stock to be converted
into Shares to be sold by the Selling Stockholder hereunder and under the
International Underwriting Agreement, free and clear of all liens,
encumbrances, equities or claims; and, upon delivery of such Shares and
payment therefor pursuant hereto and thereto, good and valid title to such
Shares, free and clear of all liens, encumbrances, equities or claims,
will pass to the several Underwriters or the International Underwriters,
as the case may be;
(iv) During the period beginning from the date hereof and continuing to
and including the date 90 days after the date of the Prospectus, not to,
without the prior written consent of Xxxxxxx, Xxxxx & Co., offer, sell,
contract to sell or otherwise dispose of, except as provided hereunder or
5
under the International Underwriting Agreement, any securities of the
Company that are substantially similar to the Shares, including but not
limited to any securities that are convertible into or exchangeable for,
or that represent the right to receive, Stock or any such substantially
similar securities (other than (i) pursuant to employee stock option plans
existing on, or upon the conversion or exchange of convertible or
exchangeable securities outstanding as of, the date of this Agreement,
(ii) to an affiliate or Permitted Transferee (as defined in the Amended
and Restated Certificate of Incorporation of the Company) which agrees to
be bound by the provisions of this Section 1(b) (iv) and (iii) pursuant to
a pledge agreement securing indebtedness which is not part of an offering
of any security that is convertible into or exchangeable for Stock). In
addition, the Selling Stockholder agrees that, during the period beginning
from the date hereof and continuing to and including the date 90 days
after the date of the Prospectus, not to, without the prior written
consent of Xxxxxxx, Sachs & Co., make any demand for, or exercise any
right with respect to, except as provided hereunder or under the
International Underwriting Agreement, the registration of any securities
of the Company that are substantially similar to the Shares, including but
not limited to any securities that are convertible into or exchangeable
for, or that represent the right to receive, Stock or any substantially
similar securities;
(v) Such Selling Stockholder 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 Shares;
(vi) The Preliminary Prospectus dated February 28, 1997, at the time of
filing thereof, conformed in all material respects to the requirements of
the Act and the rules and regulations of the Commission thereunder, and,
as of its date, 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 the light of the circumstances under
which they were made, not misleading; provided, however, that this
representation and warranty (A) shall only apply to statements in or
omissions from the Preliminary Prospectus relating to the Selling
Stockholder and (B) shall not apply to any statements in or omissions from
the Preliminary Prospectus made in reliance upon and in conformity with
information furnished in writing to the Company by an Underwriter through
Xxxxxxx, Xxxxx & Co. expressly for use therein;
(vii) The Registration Statement conforms, and the Prospectus and any
further amendments or supplements to the Registration Statement or the
Prospectus will conform, in all material respects to the requirements of
the Act and the rules and regulations of the Commission thereunder and do
not and will not, as of the applicable effective date as to the
Registration Statement and any amendment thereto and as of the applicable
filing date as to the Prospectus and any amendment or supplement thereto,
contain an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements
therein not misleading; provided, however, that this representation and
warranty (A) shall only apply to statements in or omissions from the
Registration Statement or Prospectus relating to the Selling Stockholder
and (B) shall not apply to statements in or omissions from the
Registration Statement or the Prospectus made in reliance upon and in
conformity with information furnished in writing to the Company by an
Underwriter through Xxxxxxx, Sachs & Co. expressly for use therein; and
(viii) In order to document the Underwriters' compliance with the
reporting and withholding provisions of the Tax Equity and Fiscal
Responsibility Act of 1982 with respect to the transactions herein
contemplated, the Selling Stockholder will deliver to you prior to or at
the Time of Delivery (as defined in Section 4 hereof) a properly completed
and executed United States Treasury Department Form W-9 (or other
applicable form or statement specified by Treasury Department regulations
in lieu thereof).
2. Subject to the terms and conditions herein set forth, (a) the Selling
Stockholder agrees to sell to each of the Underwriters, and each of the
Underwriters agrees, severally and not jointly, to purchase from the Selling
Stockholder, at a purchase price per share of $ , the number of Firm Shares
set
6
forth opposite the name of such Underwriter in Schedule I hereto and (b) in
the event and to the extent that the Underwriters shall exercise the election
to purchase Optional Shares as provided below, the Selling Stockholder agrees
to sell to each of the Underwriters, and each of the Underwriters agrees,
severally and not jointly, to purchase from the Selling Stockholder, at the
purchase price per share set forth in clause (a) of this Section 2, that
portion of the number of Optional Shares as to which such election shall have
been exercised (to be adjusted by you so as to eliminate fractional shares)
determined by multiplying such number of Optional Shares by a fraction, the
numerator of which is the maximum number of Optional Shares which such
Underwriter is entitled to purchase as set forth opposite the name of such
Underwriter in Schedule I hereto and the denominator of which is the maximum
number of Optional Shares that all of the Underwriters are entitled to
purchase hereunder.
The Selling Stockholder hereby grants to the Underwriters the right to
purchase at their election up to 600,000 Optional Shares, at the purchase
price per share set forth in the paragraph above, for the sole purpose of
covering overallotments in the sale of the Firm Shares. Any such election to
purchase Optional Shares may be exercised only by written notice from you to
the Selling Stockholder, given within a period of 30 calendar days after the
date of this Agreement, setting forth the aggregate number of Optional Shares
to be purchased and the date on which such Optional Shares are to be
delivered, as determined by you but in no event earlier than the First Time
of Delivery (as defined in Section 4 hereof) or, unless you and the Selling
Stockholder otherwise agree in writing, earlier than two or later than ten
business days after the date of such notice.
3. Upon the authorization by you of the release of the Firm Shares, the
several Underwriters propose to offer the Firm Shares for sale upon the terms
and conditions set forth in the Prospectus.
4. (a) The Shares to be purchased by each Underwriter hereunder, in
definitive form, and in such authorized denominations and registered in such
names as Xxxxxxx, Xxxxx & Co. may request upon at least forty-eight hours'
prior notice to the Selling Stockholder, shall be delivered by or on behalf
of the Selling Stockholder to Xxxxxxx, Sachs & Co., for the account of such
Underwriter, against payment by or on behalf of such Underwriter of the
purchase price therefor in same-day funds. The Selling Stockholder will cause
the certificates representing the Shares to be made available for checking
and packaging at least twenty-four hours prior to the Time of Delivery (as
defined below) with respect thereto at the office of Xxxxxxx, Xxxxx & Co., 00
Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (the "Designated Office"). The time
and date of such delivery and payment shall be, with respect to the Firm
Shares, 9:30 a.m., New York City time, on March , 1997 or such other time
and date as Xxxxxxx, Sachs & Co., the Company and the Selling Stockholder may
agree upon in writing, and, with respect to the Optional Shares, 9:30 a.m.,
New York time, on the date specified by Xxxxxxx, Sachs & Co. in the written
notice given by Xxxxxxx, Xxxxx & Co. of the Underwriters election to purchase
such Optional Shares, or such other time and date as Xxxxxxx, Sachs & Co.,
the Company and the Selling Stockholder may agree upon in writing. Such time
and date for delivery of the Firm Shares is herein called the "First Time of
Delivery", such time and date for delivery of the Optional Shares, if not the
First Time of Delivery, is herein called the "Second Time of Delivery", and
each such time and date for delivery is herein called a "Time of Delivery".
(b) The documents to be delivered at each Time of Delivery by or on behalf
of the parties hereto pursuant to Section 7 hereof, including the cross
receipt for the Shares and any additional documents requested by the
Underwriters pursuant to Section 7(j) hereof, will be delivered at the
offices of Cravath, Swaine & Xxxxx, 000 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000 (the "Closing Location"), and the Shares will be delivered at the
Designated Office, all at such Time of Delivery. A meeting will be held at
the Closing Location at 2:00 p.m., New York City time, on the New York
Business Day next preceding such Time of Delivery, at which meeting the final
drafts of the documents to be delivered pursuant to the preceding sentence
will be available for review by the parties hereto. For the purposes of this
Section 4, "New York Business Day" shall mean each Monday, Tuesday,
Wednesday, Thursday and Friday which is not a day on which banking
institutions in New York are generally authorized or obligated by law or
executive order to close.
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5. The Company agrees with each of the Underwriters:
(a) To prepare the Prospectus in a form approved by you and to file such
Prospectus pursuant to Rule 424(b) under the Act not later than the
Commission's close of business on the second business day following the
execution and delivery of this Agreement, or, if applicable, such earlier
time as may be required by Rule 430A(a)(3) under the Act; to make no further
amendment or any supplement to the Registration Statement or Prospectus prior
to the last Time of Delivery which shall be disapproved by you promptly after
reasonable notice thereof; to advise you, promptly after it receives notice
thereof, of the time when any amendment to the Registration Statement has
been filed or becomes effective or any supplement to the Prospectus or any
amended Prospectus has been filed and to furnish you with copies thereof; to
advise you, promptly after it receives notice thereof, of the issuance by the
Commission of any stop order or of any order preventing or suspending the use
of any Preliminary Prospectus or prospectus, of the suspension of the
qualification of the Shares for offering or sale in any jurisdiction, of the
initiation or threatening of any proceeding for any such purpose, or of any
request by the Commission for the amending or supplementing of the
Registration Statement or Prospectus or for additional information; and, in
the event of the issuance of any stop order or of any order preventing or
suspending the use of any Preliminary Prospectus or prospectus or suspending
any such qualification, promptly to use its best efforts to obtain the
withdrawal of such order;
(b) Promptly from time to time to take such action as you may reasonably
request to qualify the Shares for offering and sale under the securities laws
of such jurisdictions as you may request and to comply with such laws so as
to permit the continuance of sales and dealings therein in such jurisdictions
for as long as may be necessary to complete the distribution of the Shares,
provided that in connection therewith the Company shall not be required to
qualify as a foreign corporation or to file a general consent to service of
process or to subject itself to taxation in any jurisdiction;
(c) Promptly, and in any event no later than 12:00 (noon) on the second
New York Business Day preceding the Closing, and from time to time, to
furnish the Underwriters with copies of the Prospectus in New York City in
such quantities as you may reasonably request, and, if the delivery of a
prospectus is required at any time prior to the expiration of nine months
after the time of issue of the Prospectus in connection with the offering or
sale of the Shares and if at such time any event shall have occurred as a
result of which the Prospectus as then amended or supplemented would include
an untrue statement of a material fact or omit to state any material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made when such Prospectus is delivered,
not misleading, or, if for any other reason it shall be necessary during such
period to amend or supplement the Prospectus in order to comply with the Act,
to notify you and upon your request to prepare and furnish without charge to
each Underwriter and to any dealer in securities as many copies as you may
from time to time reasonably request of an amended Prospectus or a supplement
to the Prospectus which will correct such statement or omission or effect
such compliance, and in case any Underwriter is required to deliver a
prospectus in connection with sales of any of the Shares at any time nine
months or more after the time of issue of the Prospectus, upon your request
but at the expense of such Underwriter, to prepare and deliver to such
Underwriter as many copies as you may request of an amended or supplemented
Prospectus complying with Section 10(a)(3) of the Act;
(d) To make generally available to its securityholders as soon as
practicable, but in any event not later than eighteen months after the
effective date of the Registration Statement (as defined in Rule 158(c) under
the Act), an earnings statement of the Company and its subsidiaries (which
need not be audited) complying with Section 11(a) of the Act and the rules
and regulations thereunder (including, at the option of the Company, Rule
158);
(e) During the period beginning from the date hereof and continuing to and
including the date 90 days after the date of the Prospectus, not to, without
the prior written consent of Xxxxxxx, Sachs & Co., offer, sell, contract to
sell or otherwise dispose of, except as provided hereunder and under the
International Underwriting Agreement, any securities of the Company that are
substantially similar to the Shares, including but not limited to any
securities that are convertible into or exchangeable for, or that represent
the right to receive, Stock or any such substantially similar securities
(other than (i) pursuant
8
to employee stock option plans existing on, or upon the conversion or
exchange of convertible or exchangeable securities outstanding as of, the
date of this Agreement, (ii) to an affiliate or Permitted Transferee (as
defined in the Amended and Restated Certificate of Incorporation of the
Company) which agrees to be bound by the provisions of this Section 5(e) and
(iii) pursuant to a pledge agreement securing indebtedness which is not part
of an offering of any security that is convertible into or exchangeable for
Stock;
(f) To furnish to its stockholders as soon as practicable after the end of
each fiscal year an annual report (including a balance sheet and statements
of income, stockholders' equity and cash flows of the Company and its
consolidated subsidiaries certified by independent public accountants) and,
as soon as practicable after the end of each of the first three quarters of
each fiscal year (beginning with the fiscal quarter ending after the
effective date of the Registration Statement), consolidated summary financial
information of the Company and its subsidiaries for such quarter in
reasonable detail; and
(g) To use its best efforts to list, subject to notice of issuance, the
Shares on the New York Stock Exchange (the "Exchange").
6. Each of the Company and the Selling Stockholder covenants and agrees
with the several Underwriters that the Selling Stockholder will pay or cause
to be paid the following: (i) the fees, disbursements and expenses of the
Company's counsel and accountants in connection with the registration of the
Shares under the Act and all other expenses in connection with the
preparation, printing and filing of the Registration Statement, any
Preliminary Prospectus and the Prospectus and amendments and supplements
thereto and the mailing and delivering of copies thereof to the Underwriters
and dealers; (ii) the cost of printing or producing any Agreement among
Underwriters, this Agreement, the International Underwriting Agreement, the
Agreement between Syndicates, the Selling Agreement, the Blue Sky Memorandum,
closing documents (including compilations thereof) and any other documents in
connection with the offering, purchase, sale and delivery of the Shares;
(iii) all expenses in connection with the qualification of the Shares for
offering and sale under state securities laws as provided in Section 5(b)
hereof, including the reasonable fees and disbursements of counsel for the
Underwriters in connection with such qualification and in connection with the
Blue Sky survey; (iv) all fees and expenses in connection with listing the
Shares on the Exchange; (v) the filing fees incident to securing any required
review by the National Association of Securities Dealers, Inc. of the terms
of the sale of the Shares; (vi) the cost of preparing stock certificates;
(vii) the cost and charges of any transfer agent or registrar; and (viii) all
other costs and expenses incident to the performance of its obligations
hereunder which are not otherwise specifically provided for in this Section.
The Selling Stockholder will pay or cause to be paid all costs and expenses
incident to the performance of its obligations hereunder which are not
otherwise specifically provided for in this Section, including any fees and
expenses of its counsel and all expenses and taxes incident to the sale and
delivery of the Shares to be sold by it to the Underwriters hereunder. It is
understood, however, that, the Company shall bear, and the Selling
Stockholder shall not be required to pay or reimburse the Company for, the
cost of any other matters not directly relating to the sale and purchase of
the Shares pursuant to this Agreement, and that, except as provided in this
Section, and Sections 8 and 11 hereof, the Underwriters will pay all of their
own costs and expenses, including the fees of their counsel, stock transfer
taxes on resale of any of the Shares by them, and any advertising expenses
connected with any offers they may make.
7. The obligations of the Underwriters hereunder, as to the Shares to be
delivered at each Time of Delivery, shall be subject, in their discretion, to
the condition that all representations and warranties and other statements of
the Company and the Selling Stockholder herein are, at and as of such Time of
Delivery, true and correct, the condition that each of the Company and the
Selling Stockholder shall have performed all of its obligations hereunder
theretofore to be performed, and the following additional conditions:
(a) The Prospectus shall have been filed with the Commission pursuant to
Rule 424(b) within the applicable time period prescribed for such filing by
the rules and regulations under the Act and in accordance with Section 5(a)
hereof; no stop order suspending the effectiveness of the Registration
9
Statement or any part thereof shall have been issued and no proceeding for
that purpose shall have been initiated or threatened by the Commission; and
all requests for additional information on the part of the Commission shall
have been complied with to your reasonable satisfaction;
(b) Cravath, Swaine & Xxxxx, counsel for the Underwriters, shall have
furnished to you such opinion or opinions (a draft of each such opinion is
attached as Annex II (a) hereto), dated such Time of Delivery, with respect
to the matters covered in paragraphs (i), (ii), (iv), (vii) and (xi) of
subsection (c) below as well as such other related matters as you may
reasonably request, and such counsel shall have received such papers and
information as they may reasonably request to enable them to pass upon such
matters;
(c) Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP, special counsel for the
Company and the Selling Stockholder, shall have furnished to you their
written opinion (a draft of such opinion is attached as Annex II(b) hereto),
dated such Time of Delivery, in form and substance reasonably satisfactory to
you, to the effect that:
(i) The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Delaware, with
power and authority (corporate and other) to own its properties and conduct
its business as described in the Prospectus;
(ii) The authorized, issued and outstanding capital stock of the Company
is as set forth in the Prospectus under the caption "Capitalization" (except
for the conversion of the shares of Class B Stock into the Shares to be sold
by the Selling Stockholder pursuant to this Agreement or the International
Underwriting Agreement or subsequent issuances, if any, pursuant to the
Company's stock option plan or referred to in or contemplated by the
Prospectus); and all of the outstanding shares of Stock and Class B Stock of
the Company outstanding as of such Time of Delivery have been duly authorized
and validly issued and are fully paid and nonassessable;
(iii) Each Subsidiary of the Company listed in Schedule II hereto (the
"Delaware Subsidiaries") has been duly incorporated and is validly existing
as a corporation in good standing under the laws of the State of Delaware;
all of the issued shares of capital stock of each such Subsidiary have been
duly authorized and validly issued, are fully paid and non-assessable, and
(except for directors' qualifying shares and except as otherwise set forth in
the Prospectus) are owned of record, directly or indirectly, by the Company;
and, to such counsel's knowledge, the Company has not granted any liens,
encumbrances, equities or claims in the capital stock of such Subsidiaries
pursuant to the agreements filed as exhibits to the Registration Statement,
other than pursuant to the Credit Agreement and its related security
agreements;
(iv) This Agreement and the International Underwriting Agreement have been
duly authorized, executed and delivered by each of the Company and the
Selling Stockholder;
(v) The compliance by the Company with all of the provisions of this
Agreement and the International Underwriting Agreement and the consummation
by the Company of the transactions herein and therein contemplated will not
conflict with or result in a breach or violation of any of the terms or
provisions of, or constitute a default under, any agreement listed as an
exhibit to the Registration Statement, nor will such action result in any
violation of the provisions of the Amended and Restated Certificate of
Incorporation or Amended and Restated By-laws of the Company or any statute
or any order, rule or regulation known to such counsel of any court or
governmental agency or body having jurisdiction over the Company or any of
its Subsidiaries or any of their respective properties, except for (other
than in the case of the Amended and Restated Certificate of Incorporation and
the Amended and Restated By-laws) such conflicts, breaches, violations or
defaults which would not, individually or in the aggregate, have a Material
Adverse Effect;
(vi) No consent, approval, authorization, order, registration or
qualification of or with any such court or governmental agency or body is
required for the sale of the Shares by the Selling Stockholder or the
consummation by the Company and the Selling Stockholder of the transactions
contemplated by this Agreement and the International Underwriting Agreement,
except the registration under the Act and the Exchange Act of the Shares, and
such consents, approvals, authorizations, registrations or qualifications as
may be required under state or foreign securities or Blue Sky laws or by the
rules and regulations of
10
the NASD in connection with the purchase and distribution of the Shares by
the Underwriters and the International Underwriters, except that such counsel
need not express any opinion as to (i) any securities laws of any
jurisdiction (other than the Federal securities laws) and the rules and
regulations of the NASD, (ii) laws other than those that, in each such
counsel's experience, are normally applicable to transactions of the type
contemplated by this Agreement and the International Underwriting Agreement
and (iii) any consent or authorization which may have become applicable to
the Company or the Selling Stockholder as a result of the involvement of the
Underwriters or of the International Underwriters in the transactions
contemplated by this Agreement or the International Underwriting Agreement
because of their legal or regulatory status or because of any other facts
specifically pertaining to them;
(vii) The statements set forth in the Prospectus under the captions "Risk
Factors -- Extensive and Increasing Regulation of Tobacco Products" (as to
matters of Federal law only), "Risk Factors -- Effects of Increases in Excise
Taxes" (as to matters of Federal law only), "Risk Factors -- Substantial
Effects of Failure to Receive Possessions Tax Credit" (as to matters of
Federal law only), "Management's Discussion and Analysis of Financial
Condition and Results of Operations -- Taxation and Regulation -- Possessions
Tax Credit" (as to matters of Federal law only), "Business -- The Tobacco
Industry -- Regulation" (as to matters of Federal law only), "Certain
Relationships and Related Transactions -- Tax Sharing Agreement", "Certain
Relationships and Related Transactions -- Registration Rights Agreement",
"Description of Capital Stock" and "Certain United States Tax Consequences to
Non-United States Holders", insofar as they purport to describe or summarize
certain provisions of the agreements, statutes and regulations referred to
therein, fairly describe or summarize such provisions in all material
respects;
(viii) The Company is not an "investment company", as such term is defined
in the Investment Company Act; and
(ix) The sale of the Shares being delivered at such Time of Delivery by
the Selling Stockholder under this Agreement and the International
Underwriting Agreement and the compliance by the Selling Stockholder with all
of the provisions of this Agreement and the International Underwriting
Agreement and the consummation by the Selling Stockholder of the transactions
herein and therein contemplated will not conflict with or result in a breach
or violation of any terms or provisions of, or constitute a default under,
any agreement listed as an exhibit to the Registration Statement or any
material indenture or other debt instrument, nor will such action result in
any violation of the provisions of the certificate of incorporation or
by-laws of the Selling Stockholder or any statute or any order, rule or
regulation known to such counsel of any court or governmental agency or body
having jurisdiction over the Selling Stockholder or any of its subsidiaries
(other than the Company and its subsidiaries, which are covered by the
opinion set forth in paragraph (c)(v) above) or any of their respective
properties, except for (other than in the case of the certificate of
incorporation and the by-laws of the Selling Stockholder) such conflicts,
breaches, violations or defaults which would not, individually or in the
aggregate, affect the validity or enforceability of, or adversely affect the
Selling Stockholder's ability to consummate, the transactions contemplated by
or perform its obligations under this Agreement or the International
Underwriting Agreement;
(x) Assuming that each of the Underwriters and the International Underwriters
acquired its interest in the certificate representing the Shares and the
International Shares identified on Schedule C hereto (the "Certificate") in
good faith and without notice of any adverse claims, upon delivery to Xxxxxxx,
Sachs & Co., as agent for the Underwriters and the International Underwriters
(the "Agent") in the State of New York of the Certificate representing the
Shares indorsed to the Agent, the Agent will acquire all of the Selling
Stockholder's rights in the Shares represented by the Certificate free of any
adverse claims (within the meaning of Section 8-302 of the New York Uniform
Commercial Code).
(xi) The Registration Statement and the Prospectus and any further
amendments and supplements thereto made by the Company prior to such Time of
Delivery (other than the financial statements and related schedules therein,
as to which such counsel need express no opinion) comply as to form in all
material respects with the requirements of the Act and the rules and
regulations thereunder, although they do not assume any responsibility for
the accuracy, completeness or fairness of the statements
11
contained in the Registration Statement or the Prospectus, except for those
referred to in the opinion in subsection (vii) of this Section 7(c); they
have no reason to believe that, as of its effective date, the Registration
Statement or any further amendment thereto made by the Company prior to such
Time of Delivery (other than the financial statements and related statements
and related schedules therein, as to which such counsel need express no
opinion) contained an untrue statement of a material fact or omitted to state
a material fact required to be stated therein or necessary to make the
statements therein not misleading or that, as of its date, the Prospectus or
any further amendment or supplement thereto made by the Company prior to such
Time of Delivery (other than the financial statements and related schedules
therein, as to which such counsel need express no opinion) contained an
untrue statement of a material fact or omitted to state a material fact
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading or that, as of such Time of
Delivery, either the Registration Statement or the Prospectus or any further
amendment or supplement thereto made by the Company prior to such Time of
Delivery (other than the financial statements and related schedules therein,
as to which such counsel need express no opinion) contains an untrue
statement of a material fact or omits to state a material fact necessary to
make the statements therein, in the light of the circumstances under which
they were made, not misleading; and they do not know of any amendment to the
Registration Statement required to be filed or of any contracts or other
documents of a character required to be filed as an exhibit to the
Registration Statement or required to be described in the Registration
Statement or the Prospectus which are not filed or described as required;
In rendering such opinion, such counsel may (i) state that they express no
opinion as to the laws of any jurisdiction other than the laws of the United
States of America, to the extent specifically referred to therein, and the
laws of the State of New York and the Delaware General Corporation Law and
(ii) rely upon the opinions of local counsel and in respect of matters of
fact upon certificates of the Company, the Selling Stockholder or their
respective subsidiaries.
(d) Xxxxx X. Xxxxxxxx, Esq., Executive Vice President and General Counsel
of the Company, shall have furnished to you his written opinion (a draft of
such opinion is attached as Annex II(c) hereto), dated the Time Delivery, in
form and substance reasonably satisfactory to you, to the effect that:
To the best of such counsel's knowledge and other than as set forth in the
Prospectus, there are no legal or governmental proceedings pending to which
the Company or any of its Subsidiaries is a party or to which any property of
the Company or any of its Subsidiaries is the subject which would,
individually or in the aggregate, be reasonably likely to have a Material
Adverse Effect; and, to the best of such counsel's knowledge, no such
proceedings are threatened by governmental authorities or by others.
(e) On the date of the Prospectus at a time prior to the execution of this
Agreement, at 9:30 a.m., New York City time, on the effective date of any
post-effective amendment to the Registration Statement filed subsequent to
the date of this Agreement and also at each Time of Delivery, Ernst & Young
LLP shall have furnished to you a letter or letters, dated the respective
dates of delivery thereof, in form and substance satisfactory to you,
substantially to the effect set forth in Annex I hereto (the executed copy of
the letter delivered prior to the execution of this Agreement is attached as
Annex I(a) hereto and a draft of the form of letter to be delivered on the
effective date of any post-effective amendment to the Registration Statement
and as of each Time of Delivery is attached as Annex I(b) hereto);
(f) Neither the Company nor any of its Subsidiaries shall have sustained
since the date of the latest audited financial statements included in the
Prospectus any loss or interference with its business from fire, explosion,
flood or other calamity, whether or not covered by insurance, or from any
labor dispute or court or governmental action, order or decree, otherwise
than as set forth or contemplated in the Prospectus and other than such
losses or interferences which would not, individually or in the aggregate,
have a Material Adverse Effect, and (ii) since the respective dates as of
which information is given in the Prospectus there shall not have been any
change in the capital stock or long-term debt of the Company or any of its
Subsidiaries in or affecting the business affairs, business prospects,
management, consolidated financial position, stockholders' equity or results
of operations of the Company and its Subsidiaries considered as one
enterprise, otherwise than as set forth in or contemplated by the
12
Prospectus, the effect of which, in any such case described in Clause (i) or
(ii), is in the judgment of the Representatives so material and adverse as to
make it impracticable or inadvisable to proceed with the public offering or
the delivery of the Shares being delivered at such Time of Delivery on the
terms and in the manner contemplated in the Prospectus;
(g) On or after the date hereof there shall not have occurred any of the
following: (i) a suspension or material limitation in trading in securities
generally on the Exchange; (ii) a suspension or material limitation in
trading in the Company's securities on the Exchange; (iii) a general
moratorium on commercial banking activities declared by either Federal or New
York State authorities; or (iv) the outbreak or escalation of hostilities
involving the United States or the declaration by the United States of a
national emergency or war, if the effect of any such event specified in this
Clause (iv) in the judgment of the Representatives makes it impracticable or
inadvisable to proceed with the public offering or the delivery of the Shares
being delivered at such Time of Delivery on the terms and in the manner
contemplated in the Prospectus;
(h) The Shares to be sold by the Selling Stockholder at such Time of
Delivery shall have been duly listed, subject to notice of issuance, on the
Exchange; and
(i) The Company and the Selling Stockholder shall have furnished or caused
to be furnished to you at such Time of Delivery certificates of the Company
and the Selling Stockholder, respectively, satisfactory to you as to the
accuracy of the representations and warranties of the Company and the Selling
Stockholder herein at and as of such Time of Delivery, as to the performance
by the Company and the Selling Stockholder, respectively, of all of its
obligations hereunder to be performed at or prior to such Time of Delivery,
as to the matters set forth in subsections (a) and (f) of this Section and as
to such other matters as you may reasonably request.
8. (a) The Company will indemnify and hold harmless each Underwriter and
the Selling Stockholder against any losses, claims, damages or liabilities,
joint or several, to which such Underwriter or the Selling Stockholder may
become subject, under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are
based upon an untrue statement or alleged untrue statement of a material fact
contained in any Preliminary Prospectus, the Registration Statement or the
Prospectus, or any amendment or supplement thereto, or arise out of or are
based upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, and will reimburse each Underwriter and the Selling Stockholder
for any legal or other expenses reasonably incurred by such Underwriter or
the Selling Stockholder in connection with investigating or defending any
such action or claim as such expenses are incurred; provided, however, that
the Company shall not be liable in any such case to the extent that any such
loss, claim, damage or liability arises out of or is based upon an untrue
statement or alleged untrue statement or omission or alleged omission made in
any Preliminary Prospectus, the Registration Statement or the Prospectus or
any such amendment or supplement which (i) in the case of any Underwriter, is
made in reliance upon and in conformity with written information furnished to
the Company by any Underwriter through Xxxxxxx, Xxxxx & Co. expressly for use
therein or (ii) in the case of the Selling Stockholder, related to the
Selling Stockholder; and provided further, however, that the Company shall
not be liable with respect to any Preliminary Prospectus to any Underwriter
(or any person controlling such Underwriter) from whom the person asserting
any such loss, claim, damage or liability purchased the Shares which are the
subject thereof if such person did not receive a copy of the Prospectus (or
the Prospectus as supplemented) at or prior to the confirmation of the sale
of such Shares to such person in any case where such delivery is required by
the Act and (A) the defect in such Preliminary Prospectus was cured in the
Prospectus (or the Prospectus as supplemented) and (B) such Underwriter had
previously been furnished by or on behalf of the Company (prior to the date
of mailing by such Underwriter of the applicable confirmation) with a
sufficient number of copies of the Prospectus as so amended or supplemented.
(b) The Selling Stockholder will indemnify and hold harmless each
Underwriter and the Company against any losses, claims, damages or
liabilities, joint or several, to which such Underwriter or the Company may
become subject, under the Act or otherwise, insofar as such losses, claims,
damages or
13
liabilities (or actions in respect thereof) arise out of or are based upon an
untrue statement or alleged untrue statement of a material fact contained in
any Preliminary Prospectus, the Registration Statement or the Prospectus, or
any amendment or supplement thereto, or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading,
and will reimburse each Underwriter and the Company for any legal or other
expenses reasonably incurred by such Underwriter or the Company in connection
with investigating or defending any such action or claim as such expenses are
incurred; provided, however, that the Selling Stockholder shall not be liable
in any such case to the extent that any such loss, claim, damage or liability
arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission made in any Preliminary Prospectus,
the Registration Statement or the Prospectus or any such amendment or
supplement in reliance upon and in conformity with written information
furnished to the Company by any Underwriter through Xxxxxxx, Sachs & Co.
expressly for use therein, and that the Selling Stockholder shall only be
liable to the extent that any such loss, claim, damage or liability arises
out of or is based upon an untrue statement or alleged untrue statement or
omission or alleged omission relating to the Selling Stockholder; and,
provided further, however, that the Selling Stockholder shall not be liable
with respect to any Preliminary Prospectus to any Underwriter (or any person
controlling such Underwriter) from whom the person asserting any such loss,
claim, damage or liability purchased the Shares which are the subject thereof
if such person did not receive a copy of the Prospectus (or the Prospectus as
supplemented) at or prior to the confirmation of the sale of such Shares to
such person in any case where such delivery is required by the Act and (A)
the defect in such Preliminary Prospectus was cured in the Prospectus (or the
Prospectus as supplemented) and (B) such Underwriter had previously been
furnished by or on behalf of the Company (prior to the date of mailing by
such Underwriter of the applicable confirmation) with a sufficient number of
copies of the Prospectus as supplemented.
(c) Each Underwriter will indemnify and hold harmless the Company and the
Selling Stockholder against any losses, claims, damages or liabilities to
which the Company or the Selling Stockholder may become subject, under the
Act or otherwise, insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of or are based upon an untrue
statement or alleged untrue statement of a material fact contained in any
Preliminary Prospectus, the Registration Statement or the Prospectus, or any
amendment or supplement thereto, or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, in
each case to the extent, but only to the extent, that such untrue statement
or alleged untrue statement or omission or alleged omission was made in any
Preliminary Prospectus, the Registration Statement or the Prospectus or any
such amendment or supplement in reliance upon and in conformity with written
information furnished to the Company by such Underwriter through Xxxxxxx,
Xxxxx & Co. expressly for use therein; and will reimburse the Company and the
Selling Stockholder for any legal or other expenses reasonably incurred by
the Company or the Selling Stockholder in connection with investigating or
defending any such action or claim as such expenses are incurred.
(d) Promptly after receipt by an indemnified party under subsection (a),
(b) or (c) above of notice of the commencement of any action, such
indemnified party shall, if a claim in respect thereof is to be made against
the indemnifying party under such subsection, notify the indemnifying party
in writing of the commencement thereof; but the omission so to notify the
indemnifying party shall not relieve it from any liability which it may have
to any indemnified party under such subsection, except to the extent it has
been materially prejudiced by such failure. In case any such action shall be
brought against any indemnified party and it shall notify the indemnifying
party of the commencement thereof, the indemnifying party shall be entitled
to participate therein and, to the extent that it shall wish, jointly with
any other indemnifying party similarly notified, to assume the defense
thereof, with counsel reasonably satisfactory to such indemnified party (who
shall not, except with the consent of the indemnified party, be counsel to
the indemnifying party), and, after notice from the indemnifying party to
such indemnified party of its election so to assume the defense thereof, the
indemnifying party shall not be liable to such indemnified party under such
subsection for any legal expenses of other counsel or any other expenses, in
each case subsequently incurred by such indemnified party, in connection with
the defense thereof
14
other than reasonable costs of investigation; provided, however, if the
defendants in any such action include both an indemnified party and an
indemnifying party and the indemnified party shall have reasonably concluded
that there may be legal defenses available to it and/or other indemnified
parties that are different from or additional to those available to the
indemnifying party, the indemnified party or parties under subsection (a),
(b) or (c) above shall have the right to employ not more than one counsel
(and one local counsel in each jurisdiction) reasonably satisfactory to the
indemnifying party to represent them and, in that event, the fees and
expenses of not more than one such separate counsel shall be paid by the
indemnifying party, as such expenses are incurred. No indemnifying party
shall, without the written consent of the indemnified party, effect the
settlement or compromise of, or consent to the entry of any judgment with
respect to, any pending or threatened action or claim in respect of which
indemnification or contribution may be sought hereunder (whether or not the
indemnified party is an actual or potential party to such action or claim)
unless such settlement, compromise or judgment (i) includes an unconditional
release of the indemnified party from all liability arising out of such
action or claim and (ii) does not include a statement as to or an admission
of fault, culpability or a failure to act, by or on behalf of any indemnified
party.
(e) If the indemnification provided for in this Section 8 is unavailable
to or insufficient to hold harmless an indemnified party under subsection
(a), (b) or (c) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities
(or actions in respect thereof) in such proportion as is appropriate to
reflect the relative benefits received by the Company and the Selling
Stockholder on the one hand and the Underwriters on the other from the
offering of the Shares. If, however, the allocation provided by the
immediately preceding sentence is not permitted by applicable law or if the
indemnified party failed to give the notice required under subsection (d)
above, then each indemnifying party shall contribute to such amount paid or
payable by such indemnified party in such proportion as is appropriate to
reflect not only such relative benefits but also the relative fault of the
Company and the Selling Stockholder on the one hand and the Underwriters on
the other in connection with the statements or omissions which resulted in
such losses, claims, damages or liabilities (or actions in respect thereof),
as well as any other relevant equitable considerations. The relative benefits
received by the Company and the Selling Stockholder on the one hand and the
Underwriters on the other shall be deemed to be in the same proportion as the
total net proceeds from the offering of the Shares purchased under this
Agreement (before deducting expenses) received by the Company and the Selling
Stockholder on the one hand bear to the total underwriting discounts and
commissions received by the Underwriters on the other with respect to the
Shares purchased under this Agreement, in each case as set forth in the table
on the cover page of the Prospectus. The relative fault shall be determined
by reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission or alleged omission to state a
material fact relates to information supplied by the Company or the Selling
Stockholder on the one hand or the Underwriters on the other and the parties'
relative intent, knowledge, access to information and opportunity to correct
or prevent such statement or omission. The Company, the Selling Stockholder
and the Underwriters agree that it would not be just and equitable if
contributions pursuant to this subsection (e) were determined by pro rata
allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take account of
the equitable considerations referred to above in this subsection (e). The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages or liabilities (or actions in respect thereof) referred to
above in this subsection (e) shall be deemed to include any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this subsection (e), no Underwriter shall be required to
contribute any amount in excess of the amount by which the total price at
which the Shares underwritten by it and distributed to the public were
offered to the public exceeds the amount of any damages which such
Underwriter has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Underwriters' obligations in this
subsection (e) to contribute are several in proportion to their respective
underwriting obligations and not joint.
15
(f) The obligations of the Company and the Selling Stockholder under this
Section 8 shall be in addition to any liability which the Company and the
Selling Stockholder may otherwise have and shall extend, upon the same terms
and conditions, to each person, if any, who controls any Underwriter within
the meaning of the Act; and the obligations of the Underwriters under this
Section 8 shall be in addition to any liability which the respective
Underwriters may otherwise have and shall extend, upon the same terms and
conditions, to each officer and director of the Company or the Selling
Stockholder and to each person, if any, who controls the Company or the
Selling Stockholder within the meaning of the Act. The obligations of the
Selling Stockholder under this Section 8 shall not exceed the amount of the
net proceeds received by the Selling Stockholder in connection with the sale
of the Shares hereunder and under the International Underwriting Agreement.
9. (a) If any Underwriter shall default in its obligation to purchase the
Shares which it has agreed to purchase hereunder at a Time of Delivery, you
may in your discretion arrange for you or another party or other parties to
purchase such Shares on the terms contained herein. If within thirty-six
hours after such default by any Underwriter you do not arrange for the
purchase of such Shares, then the Selling Stockholder shall be entitled to a
further period of thirty-six hours within which to procure another party or
other parties satisfactory to you to purchase such Shares on such terms. In
the event that, within the respective prescribed periods, you notify the
Selling Stockholder that you have so arranged for the purchase of such
Shares, or the Selling Stockholder notifies you that it has so arranged for
the purchase of such Shares, you or the Selling Stockholder shall have the
right to postpone such Time of Delivery for a period of not more than seven
days, in order to effect whatever changes may thereby be made necessary in
the Registration Statement or the Prospectus, or in any other documents or
arrangements, and the Company agrees to file promptly any amendments to the
Registration Statement or the Prospectus which in your opinion may thereby be
made necessary. The term "Underwriter" as used in this Agreement shall
include any person substituted under this Section with like effect as if such
person had originally been a party to this Agreement with respect to such
Shares.
(b) If, after giving effect to any arrangements for the purchase of the
Shares of a defaulting Underwriter or Underwriters by you and the Selling
Stockholder as provided in subsection (a) above, the aggregate number of such
Shares which remains unpurchased does not exceed one-eleventh of the
aggregate number of all the Shares to be purchased at such Time of Delivery,
then the Selling Stockholder shall have the right to require each
non-defaulting Underwriter to purchase the number of Shares which such
Underwriter agreed to purchase hereunder at such Time of Delivery and, in
addition, to require each non-defaulting Underwriter to purchase its pro rata
share (based on the number of Shares which such Underwriter agreed to
purchase hereunder) of the Shares of such defaulting Underwriter or
Underwriters for which such arrangements have not been made; but nothing
herein shall relieve a defaulting Underwriter from liability for its default.
(c) If, after giving effect to any arrangements for the purchase of the
Shares of a defaulting Underwriter or Underwriters by you and the Selling
Stockholder as provided in subsection (a) above, the aggregate number of such
Shares which remains unpurchased exceeds one-eleventh of the aggregate number
of all the Shares to be purchased at such Time of Delivery, or if the Selling
Stockholder shall not exercise the right described in subsection (b) above to
require non-defaulting Underwriters to purchase Shares of a defaulting
Underwriter or Underwriters, then this Agreement (or, with respect to the
Second Time of Delivery, the obligations of the Underwriters to purchase and
of the Selling Stockholder to sell the Optional Shares) shall thereupon
terminate, without liability on the part of any non-defaulting Underwriter or
the Selling Stockholder, except for the expenses to be borne by the Selling
Stockholder and the Underwriters as provided in Section 6 hereof and the
indemnity and contribution agreements in Section 8 hereof; but nothing herein
shall relieve a defaulting Underwriter from liability for its default.
10. The respective indemnities, agreements, representations, warranties
and other statements of the Company, the Selling Stockholder and the several
Underwriters, as set forth in this Agreement or made by or on behalf of them,
respectively, pursuant to this Agreement, shall remain in full force and
effect, regardless of any investigation (or any statement as to the results
thereof) made by or on behalf of any Underwriter or any controlling person of
any Underwriter, or the Company, or the Selling Stockholder, or any officer
or director or controlling person of the Company, or any controlling person
of the Selling Stockholder, and shall survive delivery of and payment for the
Shares.
16
11. If this Agreement shall be terminated pursuant to Section 9 hereof,
neither the Company nor the Selling Stockholder shall then be under any
liability to any Underwriter except as provided in Sections 6 and 8 hereof;
but, if for any other reason, any Shares are not delivered by or on behalf of
the Selling Stockholder as provided herein, the Selling Stockholder will
reimburse the Underwriters through you for all out-of-pocket expenses
approved in writing by you, including fees and disbursements of counsel,
reasonably incurred by the Underwriters in making preparations for the
purchase, sale and delivery of the Shares not so delivered, but the Company
and the Selling Stockholder shall then be under no further liability to any
Underwriter in respect of the Shares not so delivered except as provided in
Sections 6 and 8 hereof.
12. In all dealings hereunder, you shall act on behalf of each of the
Underwriters, and the parties hereto shall be entitled to act and rely upon
any statement, request, notice or agreement on behalf of any Underwriter made
or given by you jointly or by Xxxxxxx, Sachs & Co. on behalf of you as the
representatives.
All statements, requests, notices and agreements hereunder shall be in
writing, and if to the Underwriters shall be delivered or sent by mail, telex
or facsimile transmission to you as the representatives at in care of
Xxxxxxx, Xxxxx & Co., 00 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention:
Registration Department; if to the Selling Stockholder shall be delivered or
sent by mail, telex or facsimile transmission to 00 Xxxx 00xx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000, Attention: Xxxxx X. Xxxxxxxx; and if to the Company
shall be delivered or sent by mail, telex or facsimile transmission to the
address of the Company set forth in the Registration Statement, Attention:
Secretary; provided, however, that any notice to an Underwriter pursuant to
Section 8(c) hereof shall be delivered or sent by mail, telex or facsimile
transmission to such Underwriter at its address set forth in its
Underwriters' Questionnaire, or telex constituting such Questionnaire, which
address will be supplied to the Company or the Selling Stockholder by you
upon request. Any such statements, requests, notices or agreements shall take
effect at the time of receipt thereof.
13. This Agreement shall be binding upon, and inure solely to the benefit
of, the Underwriters, the Company and the Selling Stockholder and, to the
extent provided in Sections 8 and 10 hereof, the officers and directors of
the Company and each person who controls the Company, the Selling Stockholder
or any Underwriter, and their respective heirs, executors, administrators,
successors and assigns, and no other person shall acquire or have any right
under or by virtue of this Agreement. No purchaser of any of the Shares from
any Underwriter shall be deemed a successor or assign by reason merely of
such purchase.
14. Time shall be of the essence of this Agreement. As used herein, the
term "business day" shall mean any day when the Commission's office in
Washington, D.C. is open for business.
15. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK.
16. This Agreement may be executed by any one or more of the parties
hereto in any number of counterparts, each of which shall be deemed to be an
original, but all such counterparts shall together constitute one and the
same instrument.
17
If the foregoing is in accordance with your understanding, please sign and
return to us one for the Company, one for the Selling Stockholder and for
each of the Representatives plus one for each counsel counterparts hereof,
and upon the acceptance hereof by you, on behalf of each of the Underwriters,
this letter and such acceptance hereof shall constitute a binding agreement
between each of the Underwriters, the Company and the Selling Stockholder. It
is understood that your acceptance of this letter on behalf of each of the
Underwriters is pursuant to the authority set forth in a form of Agreement
among Underwriters (U.S. Version), the form of which shall be submitted to
the Company and the Selling Stockholder for examination upon request, but
without warranty on your part as to the authority of the signers thereof.
Very truly yours,
Consolidated Cigar Holdings Inc.
By:
-------------------------------
Name:
Title:
Mafco Consolidated Group Inc.
By:
-------------------------------
Name:
Title:
Accepted as of the date hereof:
Xxxxxxx, Xxxxx & Co.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated
Xxxxxx Xxxxxxx & Co. Incorporated
By:
-------------------------------------
(Xxxxxxx, Sachs & Co.)
On behalf of each of the Underwriters
18
SCHEDULE I
NUMBER OF OPTIONAL
SHARES TO BE
TOTAL NUMBER OF PURCHASED IF
FIRM SHARES MAXIMIUM OPTION
UNDERWRITER TO BE PURCHASED EXERCISED
-------------------------------------------------- --------------- ------------------
Xxxxxxx, Xxxxx & Co ...............................
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated
Xxxxxx Xxxxxxx & Co. Incorporated .................
--------------- ------------------
Total ............................................. 4,000,000 600,000
=============== ==================
19
SCHEDULE II
Delaware Subsidiaries
Consolidated Cigar Corporation
Congar International Corporation
Triple C Marketing Inc.
20
ANNEX I
FORM OF ANNEX I DESCRIPTION OF COMFORT LETTER
FOR REGISTRATION STATEMENTS ON FORM S-1
Pursuant to Section 7(f) of the Underwriting Agreement, the accountants
shall furnish letters to the Underwriters to the effect that:
(i) They are independent certified public accountants with respect to the
Company and its subsidiaries within the meaning of the Act and the applicable
published rules and regulations thereunder;
(ii) In their opinion, the financial statements and any supplementary
financial information and schedules (and, if applicable, financial forecasts
and/or pro forma financial information) examined by them and included in the
Prospectus or the Registration Statement comply as to form in all material
respects with the applicable accounting requirements of the Act and the
related published rules and regulations thereunder; and, if applicable, they
have made a review in accordance with standards established by the American
Institute of Certified Public Accountants of the unaudited consolidated
interim financial statements, selected financial data, pro forma financial
information, financial forecasts and/or condensed financial statements
derived from audited financial statements of the Company for the periods
specified in such letter, as indicated in their reports thereon, copies of
which have been furnished separately to the representatives of the
Underwriters (the "Representatives");
(iii) They have made a review in accordance with standards established by
the American Institute of Certified Public Accountants of the unaudited
condensed consolidated statements of income, consolidated balance sheets and
consolidated statements of cash flows included in the Prospectus and on the
basis of specified procedures including inquiries of officials of the Company
who have responsibility for financial and accounting matters regarding
whether the unaudited condensed consolidated financial statements included in
the Prospectus comply as to form in all material respects with the applicable
accounting requirements of the Act and the related published rules and
regulations, nothing came to their attention that caused them to believe that
the unaudited condensed consolidated financial statements do not comply as to
form in all material respects with the applicable accounting requirements of
the Act and the related published rules and regulations;
(iv) The unaudited selected financial information with respect to the
consolidated results of operations and financial position of the Company for
the five most recent fiscal years included in the Prospectus agrees with the
corresponding amounts (after restatements where applicable) in the audited
consolidated financial statements for such five fiscal years which were
included or incorporated by reference in the Company's Annual Reports on Form
10-K for such fiscal years;
(v) They have compared the information in the Prospectus under selected
captions with the disclosure requirements of Regulation S-K and on the basis
of limited procedures specified in such letter nothing came to their
attention as a result of the foregoing procedures that caused them to believe
that this information does not conform in all material respects with the
disclosure requirements of Items 301 and 402, respectively, of Regulation
S-K;
(vi) On the basis of limited procedures, not constituting an examination
in accordance with generally accepted auditing standards, consisting of a
reading of the unaudited financial statements and other information referred
to below, a reading of the latest available interim financial statements of
the Company and its subsidiaries, inspection of the minute books of the
Company and its subsidiaries since the date of the latest audited financial
statements included in the Prospectus, inquiries of officials of the Company
and its subsidiaries responsible for financial and accounting matters and
such other inquiries and procedures as may be specified in such letter,
nothing came to their attention that caused them to believe that:
(A) any material modifications should be made to the unaudited condensed
consolidated statements of income, consolidated balance sheets and
consolidated statements of cash flows included in the Prospectus for them
to be in conformity with generally accepted accounting principles;
21
(B) any unaudited pro forma consolidated condensed financial statements
included in the Prospectus do not comply as to form in all material
respects with the applicable accounting requirements of the Act and the
published rules and regulations thereunder or the pro forma adjustments
have not been properly applied to the historical amounts in the
compilation of those statements;
(C) as of a specified date not more than five days prior to the date of
such letter, there have been any changes in the consolidated capital stock
(other than issuances of capital stock upon exercise of options and stock
appreciation rights, upon earn-outs of performance shares and upon
conversions of convertible securities, in each case which were outstanding
on the date of the latest financial statements included in the Prospectus)
or any increase in the consolidated long-term debt of the Company and its
subsidiaries, or any decreases in consolidated net current assets or
stockholders' equity or other items specified by the Representatives, or
any increases in any items specified by the Representatives, in each case
as compared with amounts shown in the latest balance sheet included in the
Prospectus, except in each case for changes, increases or decreases which
the Prospectus discloses have occurred or may occur or which are described
in such letter; and
(D) for the period from the date of the latest financial statements
included in the Prospectus to the specified date referred to in Clause (C)
there were any decreases in consolidated net revenues or operating profit
or the total or per share amounts of consolidated net income or other
items specified by the Representatives, or any increases in any items
specified by the Representatives, in each case as compared with the
comparable period of the preceding year and with any other period of
corresponding length specified by the Representatives, except in each case
for decreases or increases which the Prospectus discloses have occurred or
may occur or which are described in such letter; and
(vii) In addition to the examination referred to in their report(s)
included in the Prospectus and the limited procedures, inspection of minute
books, inquiries and other procedures referred to in paragraphs (iii) and
(vi) above, they have carried out certain specified procedures, not
constituting an examination in accordance with generally accepted auditing
standards, with respect to certain amounts, percentages and financial
information specified by the Representatives, which are derived from the
general accounting records of the Company and its subsidiaries, which appear
in the Prospectus, or in Part II of, or in exhibits and schedules to, the
Registration Statement specified by the Representatives, and have compared
certain of such amounts, percentages and financial information with the
accounting records of the Company and its subsidiaries and have found them to
be in agreement.
22
CONSOLIDATED CIGAR HOLDINGS INC.
CLASS A COMMON STOCK
(PAR VALUE $.01 PER SHARE)
-------------------------
UNDERWRITING AGREEMENT
(INTERNATIONAL VERSION)
-------------------------
March , 1997
Xxxxxxx Xxxxx International
Xxxxxxx Xxxxx International
Xxxxxx Xxxxxxx International Limited
As representatives of the several Underwriters
named in Schedule I hereto,
c/o Goldman Sachs International
Peterborough Court
000 Xxxxx Xxxxxx
Xxxxxx XX0X 0XX, Xxxxxxx
Ladies and Gentlemen:
Mafco Consolidated Group Inc., a Delaware corporation (the "Selling
Stockholder"), proposes, subject to the terms and conditions stated herein,
to sell to the Underwriters named in Schedule I hereto (the "Underwriters")
an aggregate of 1,000,000 shares (the "Firm Shares") and, at the election of
the Underwriters, up to 150,000 additional shares (the "Optional Shares") of
Class A Common Stock, par value $.01 per share (the "Stock"), of Consolidated
Cigar Holdings Inc., a Delaware corporation (the "Company") (the Firm Shares
and the Optional Shares which the Underwriters elect to purchase pursuant to
Section 2 hereof being collectively called the "Shares").
It is understood and agreed to by all parties that the Company and the
Selling Stockholder are concurrently entering into an agreement, a copy of
which is attached hereto (the "U.S. Underwriting Agreement"), providing for
the offering by the Selling Stockholder of up to a total of 4,600,000 shares
of Stock (the "U.S. Shares"), including the over-allotment option thereunder,
through arrangements with certain underwriters in the United States (the
"U.S. Underwriters"), for whom Xxxxxxx, Xxxxx & Co., Xxxxxxx Lynch, Pierce,
Xxxxxx & Xxxxx Incorporated and Xxxxxx Xxxxxxx & Co. Incorporated are acting
as representatives. Anything herein and therein to the contrary
notwithstanding, the respective closings under this Agreement and the U.S.
Underwriting Agreement are hereby expressly made conditional on one another.
The Underwriters hereunder and the U.S. Underwriters are simultaneously
entering into an Agreement between U.S. and International Underwriting
Syndicates (the "Agreement between Syndicates") which provides, among other
things, for the transfer of shares of Stock between the two syndicates and
for consultation by the Lead Managers hereunder with Xxxxxxx, Sachs & Co.
prior to exercising the rights of the Underwriters under Section 7 hereof.
Two forms of prospectus are to be used in connection with the offering and
sale of shares of Stock contemplated by the foregoing, one relating to the
Shares hereunder and the other relating to the U.S. Shares. The latter form
of prospectus will be identical to the former except for certain substitute
pages as included in the registration statement and amendments thereto as
mentioned below. Except as used in Sections 2, 3, 4, 9 and 11 herein, and
except as the context may otherwise require, references hereinafter to the
Shares shall include all of the shares of Stock which may be sold pursuant to
either this Agreement or the U.S. Underwriting Agreement, and references
herein to any prospectus whether in preliminary or final form, and whether as
amended or supplemented, shall include both of the U.S. and the international
versions thereof.
In addition, this Agreement incorporates by reference certain provisions
from the U.S. Underwriting Agreement (including the related definitions of
terms, which are also used elsewhere herein) and, for
1
purposes of applying the same, references (whether in these precise words or
their equivalent) in the incorporated provisions to the "Underwriters" shall
be to the Underwriters hereunder, to the "Shares" shall be to the Shares
hereunder as just defined, to "this Agreement" (meaning therein the U.S.
Underwriting Agreement) shall be to this Agreement (except where this
Agreement is already referred to or as the context may otherwise require) and
to the representatives of the Underwriters or to Xxxxxxx, Xxxxx & Co. shall
be to the addressees of this Agreement and to Xxxxxxx Sachs International
("GSI"), and, in general, all such provisions and defined terms shall be
applied mutatis mutandis as if the incorporated provisions were set forth in
full herein having regard to their context in this Agreement as opposed to
the U.S. Underwriting Agreement.
1. (a) The Company hereby makes with the Underwriters the same
representations, warranties and agreements as are set forth in Section 1(a)
of the U.S. Underwriting Agreement, which Section is incorporated herein by
this reference.
(b) The Selling Stockholder hereby makes with the Underwriters and the
Company the same representations, warranties and agreements as are set forth
in Section 1(b) of the U.S. Underwriting Agreement, which Section is
incorporated herein by reference.
2. Subject to the terms and conditions herein set forth, (a) the Selling
Stockholder agrees to sell to each of the Underwriters, and each of the
Underwriters agrees, severally and not jointly, to purchase from the Selling
Stockholder, at a purchase price per share of $ , the number of Firm Shares
set forth opposite the name of such Underwriter in Schedule I hereto and (b)
in the event and to the extent that the Underwriters shall exercise the
election to purchase Optional Shares as provided below, the Selling
Stockholder agrees to sell to each of the Underwriters, and each of the
Underwriters agrees, severally and not jointly, to purchase from the Selling
Stockholder, at the purchase price per share set forth in clause (a) of this
Section 2, that portion of the number of Optional Shares as to which such
election shall have been exercised (to be adjusted by you so as to eliminate
fractional shares) determined by multiplying such number of Optional Shares
by a fraction the numerator of which is the maximum number of Optional Shares
which such Underwriter is entitled to purchase as set forth opposite the name
of such Underwriter in Schedule I hereto and the denominator of which is the
maximum number of Optional Shares that all of the Underwriters are entitled
to purchase hereunder.
The Selling Stockholder hereby grants to the Underwriters the right to
purchase at their election up to 150,000 Optional Shares, at the purchase
price per share set forth in the paragraph above, for the sole purpose of
covering overallotments in the sale of the Firm Shares. Any such election to
purchase Optional Shares may be exercised only by written notice from you to
the Selling Stockholder, given within a period of 30 calendar days after the
date of this Agreement, setting forth the aggregate number of Optional Shares
to be purchased and the date on which such Optional Shares are to be
delivered, as determined by you but in no event earlier than the First Time
of Delivery (as defined in Section 4 hereof) or, unless you and the Selling
Stockholder otherwise agree in writing, earlier than two or later than ten
business days after the date of such notice.
3. Upon the authorization by GSI of the release of the Firm Shares, the
several Underwriters propose to offer the Firm Shares for sale upon the terms
and conditions set forth in the Prospectus and in the forms of Agreement
among Underwriters (International Version) and Selling Agreements, which have
been previously submitted to the Company and the Selling Stockholder by you.
Each Underwriter hereby makes to and with the Company and the Selling
Stockholder the representations and agreements of such Underwriter as a
member of the selling group contained in Sections 3(d) and 3(e) of the form
of Selling Agreements.
4. (a) The Shares to be purchased by each Underwriter hereunder, in
definitive form, and in such authorized denominations and registered in such
names as GSI may request upon at least forty-eight hours prior notice to the
Selling Stockholder shall be delivered by or on behalf of the Selling
Stockholder to GSI, for the account of such Underwriter, against payment by
or on behalf of such Underwriter of the purchase price therefor in same-day
funds. The Selling Stockholder will cause the certificates representing the
Shares to be made available for checking and packaging at least twenty four
hours prior to the Time of Delivery (as defined below) with respect thereto
at the office of GSI, 00 Xxxxx Xxxxxx, Xxx
0
Xxxx, Xxx Xxxx 00000 (the "Designated Office"). The time and date of such
delivery and payment shall be, with respect to the Firm Shares, 9:30 a.m.,
New York City time, on March , 1997 or such other time and date as GSI and
the Selling Stockholder may agree upon in writing, and, with respect to the
Optional Shares, 9:30 a.m., New York City time, on the date specified by GSI
in the written notice given by GSI of the Underwriters election to purchase
such Optional Shares, or such other time and date as GSI and the Selling
Stockholder may agree upon in writing. Such time and date for delivery of the
Firm Shares is herein called the "First Time of Delivery", such time and date
for delivery of the Optional Shares, if not the First Time of Delivery, is
herein called the "Second Time of Delivery", and each such time and date for
delivery is herein called a "Time of Delivery".
(b) The documents to be delivered at each Time of Delivery by or on behalf
of the parties hereto pursuant to Section 7 of the U.S. Underwriting
Agreement, including the cross receipt for the Shares and any additional
documents requested by the Underwriters pursuant to Section 7(j) of the U.S.
Underwriting Agreement hereof, will be delivered at the offices of Cravath,
Swaine & Xxxxx, 000 Xxxxxx Xxxxxx, Xxx Xxxx, X.X. 00000 (the "Closing
Location"), and the Shares will be delivered at the Designated Office, all at
such Time of Delivery. A meeting will be held at the Closing Location at 2:00
p.m., New York City time, on the New York Business Day next preceding such
Time of Delivery, at which meeting the final drafts of the documents to be
delivered pursuant to the preceding sentence will be available for review by
the parties hereto. For the purposes of this Section 4, "New York Business
Day" shall mean each Monday, Tuesday, Wednesday, Thursday and Friday which is
not a day on which banking institutions in New York are generally authorized
or obligated by law or executive order to close.
5. The Company hereby makes to the Underwriters the same agreements as are
set forth in Section 5 of the U.S. Underwriting Agreement, which Section is
incorporated herein by this reference.
6. The Company, the Selling Stockholder and the Underwriters hereby agree
with respect to certain expenses on the same terms as are set forth in
Section 6 of the U.S. Underwriting Agreement, which Section is incorporated
herein by this reference.
7. Subject to the provisions of the Agreement between Syndicates, the
obligations of the Underwriters hereunder shall be subject, in their
discretion, at each Time of Delivery, to the condition that all
representations and warranties and other statements of the Company and the
Selling Stockholder herein are, at and as of such Time of Delivery, true and
correct, the condition that each of the Company and the Selling Stockholder
shall have performed all of its obligations hereunder theretofore to be
performed, and additional conditions identical to those set forth in Section
7 of the U.S. Underwriting Agreement, which Section is incorporated herein by
this reference.
8. (a) The Company will indemnify and hold harmless each Underwriter and
the Selling Stockholder against any losses, claims, damages or liabilities,
joint or several, to which such Underwriter or the Selling Stockholder may
become subject, under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are
based upon an untrue statement or alleged untrue statement of a material fact
contained in any Preliminary Prospectus, the Registration Statement or the
Prospectus, or any amendment or supplement thereto, or arise out of or are
based upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, and will reimburse each Underwriter and the Selling Stockholder
for any legal or other expenses reasonably incurred by such Underwriter or
the Selling Stockholder in connection with investigating or defending any
such action or claim as such expenses are incurred; provided, however, that
the Company shall not be liable in any such case to the extent that any such
loss, claim, damage or liability arises out of or is based upon an untrue
statement or alleged untrue statement or omission or alleged omission made in
any Preliminary Prospectus, the Registration Statement or the Prospectus or
any such amendment or supplement which (i) in the case of any Underwriter, is
made in reliance upon and in conformity with written information furnished to
the Company by any Underwriter through GSI expressly for use therein or (ii)
in the case of the Selling Stockholder, related to the Selling Stockholder;
and provided further, however, that the Company shall not be liable with
respect to any Preliminary Prospectus to any Underwriter (or any person
controlling
3
such Underwriter) from whom the person asserting any such loss, claim, damage
or liability purchased the Shares which are the subject thereof if such
person did not receive a copy of the Prospectus (or the Prospectus as
supplemented) at or prior to the confirmation of the sale of such Shares to
such person in any case where such delivery is required by the Act and (A)
the defect in such Preliminary Prospectus was cured in the Prospectus (or the
Prospectus as supplemented) and (B) such Underwriter had previously been
furnished by or on behalf of the Company (prior to the date of mailing by
such Underwriter of the applicable confirmation) with a sufficient number of
copies of the Prospectus as so amended or supplemented.
(b) The Selling Stockholder will indemnify and hold harmless each
Underwriter and the Company against any losses, claims, damages or
liabilities, joint or several, to which such Underwriter or the Company may
become subject, under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are
based upon an untrue statement or alleged untrue statement of a material fact
contained in any Preliminary Prospectus, the Registration Statement or the
Prospectus, or any amendment or supplement thereto, or arise out of or are
based upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, and will reimburse each Underwriter and the Company for any legal
or other expenses reasonably incurred by such Underwriter or the Company in
connection with investigating or defending any such action or claim as such
expenses are incurred; provided, however, that the Selling Stockholder shall
not be liable in any such case to the extent that any such loss, claim,
damage or liability arises out of or is based upon an untrue statement or
alleged untrue statement or omission or alleged omission made in any
Preliminary Prospectus, the Registration Statement or the Prospectus or any
such amendment or supplement in reliance upon and in conformity with written
information furnished to the Company by any Underwriter through GSI expressly
for use therein and that the Selling Stockholder shall only be liable to the
extent that any such loss, claim, damage or liability arises out of or is
based upon an untrue statement or alleged untrue statement or omission or
alleged omission relating to the Selling Stockholder; and, provided further,
however, that the Selling Stockholder shall not be liable with respect to any
Preliminary Prospectus to any Underwriter (or any person controlling such
Underwriter) from whom the person asserting any such loss, claim, damage or
liability purchased the Shares which are the subject thereof if such person
did not receive a copy of the Prospectus (or the Prospectus as supplemented)
at or prior to the confirmation of the sale of such Shares to such person in
any case where such delivery is required by the Act and (A) the defect in
such Preliminary Prospectus was cured in the Prospectus (or the Prospectus as
supplemented) and (B) such Underwriter had previously been furnished by or on
behalf of the Company (prior to the date of mailing by such Underwriter of
the applicable confirmation) with a sufficient number of copies of the
Prospectus as supplemented.
(c) Each Underwriter will indemnify and hold harmless the Company and the
Selling Stockholder against any losses, claims, damages or liabilities to
which the Company and the Selling Stockholder may become subject, under the
Act or otherwise, insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of or are based upon an untrue
statement or alleged untrue statement of a material fact contained in any
Preliminary Prospectus, the Registration Statement or the Prospectus, or any
amendment or supplement thereto, or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, in
each case to the extent, but only to the extent, that such untrue statement
or alleged untrue statement or omission or alleged omission was made in any
Preliminary Prospectus, the Registration Statement or Prospectus or any such
amendment or supplement in reliance upon and in conformity with written
information furnished to the Company by such Underwriter through GSI
expressly for use therein; and will reimburse the Company and the Selling
Stockholder for any legal or other expenses reasonably incurred by the
Company and the Selling Stockholder in connection with investigating or
defending any such action or claim as such expenses are incurred.
(d) Promptly after receipt by an indemnified party under subsection (a),
(b) or (c) above of notice of the commencement of any action, such
indemnified party shall, if a claim in respect thereof is to be made against
the indemnifying party under such subsection, notify the indemnifying party
in writing of the
4
commencement thereof; but the omission so to notify the indemnifying party
shall not relieve it from any liability which it may have to any indemnified
party under such subsection, except to the extent it has been materially
prejudiced by such failure. In case any such action shall be brought against
any indemnified party and it shall notify the indemnifying party of the
commencement thereof, the indemnifying party shall be entitled to participate
therein and, to the extent that it shall wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof, with
counsel reasonably satisfactory to such indemnified party (who shall not,
except with the consent of the indemnified party, be counsel to the
indemnifying party), and, after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof, the
indemnifying party shall not be liable to such indemnified party under such
subsection for any legal expenses of other counsel or any other expenses, in
each case subsequently incurred by such indemnified party, in connection with
the defense thereof other than reasonable costs of investigation; provided,
however, if the defendants in any such action include both an indemnified
party and an indemnifying party and the indemnified party shall have
reasonably concluded that there may be legal defenses available to it and/or
other indemnified parties that are different from or additional to those
available to the indemnifying party, the indemnified party or parties under
subsection (a), (b) or (c) above shall have the right to employ not more than
one counsel (and one local counsel in each jurisdiction) reasonably
satisfactory to the indemnifying party to represent them and, in that event,
the fees and expenses of not more than one such separate counsel shall be
paid by the indemnifying party, as such expenses are incurred. No
indemnifying party shall, without the written consent of the indemnified
party, effect the settlement or compromise of, or consent to the entry of any
judgment with respect to, any pending or threatened action or claim in
respect of which indemnification or contribution may be sought hereunder
(whether or not the indemnified party is an actual or potential party to such
action or claim) unless such settlement, compromise or judgment (i) includes
an unconditional release of the indemnified party from all liability arising
out of such action or claim and (ii) does not include a statement as to or an
admission of fault, culpability or a failure to act, by or on behalf of any
indemnified party.
(e) If the indemnification provided for in this Section 8 is unavailable
to or insufficient to hold harmless an indemnified party under subsection
(a), (b) or (c) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities
(or actions in respect thereof) in such proportion as is appropriate to
reflect the relative benefits received by the Company and the Selling
Stockholder on the one hand and the Underwriters on the other from the
offering of the Shares. If, however, the allocation provided by the
immediately preceding sentence is not permitted by applicable law or if the
indemnified party failed to give the notice required under subsection (d)
above, then each indemnifying party shall contribute to such amount paid or
payable by such indemnified party in such proportion as is appropriate to
reflect not only such relative benefits but also the relative fault of the
Company and the Selling Stockholder on the one hand and the Underwriters on
the other in connection with the statements or omissions which resulted in
such losses, claims, damages or liabilities (or actions in respect thereof),
as well as any other relevant equitable considerations. The relative benefits
received by the Company and the Selling Stockholder on the one hand and the
Underwriters on the other shall be deemed to be in the same proportion as the
total net proceeds from the offering of the Shares purchased under this
Agreement (before deducting expenses) received by the Company and the Selling
Stockholder on the one hand bear to the total underwriting discounts and
commissions received by the Underwriters on the other with respect to the
Shares purchased under this Agreement, in each case as set forth in the table
on the cover page of the Prospectus relating to such Shares. The relative
fault shall be determined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information supplied by
the Company or the Selling Stockholder on the one hand or the Underwriters on
the other and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission. The
Company, the Selling Stockholder and the Underwriters agree that it would not
be just and equitable if contributions pursuant to this subsection (e) were
determined by pro rata allocation (even if the Underwriters were treated as
one entity for such purpose) or by any other method of allocation which does
not take account
5
of the equitable considerations referred to above in this subsection (e). The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages or liabilities (or actions in respect thereof) referred to
above in this subsection (e) shall be deemed to include any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this subsection (e), no Underwriter shall be required to
contribute any amount in excess of the amount by which the total price at
which the Shares underwritten by it and distributed to the public were
offered to the public exceeds the amount of any damages which such
Underwriter has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Underwriters' obligations in this
subsection (e) to contribute are several in proportion to their respective
underwriting obligations and not joint.
(f) The obligations of the Company and the Selling Stockholder under this
Section 8 shall be in addition to any liability which the Company and the
Selling Stockholder may otherwise have and shall extend, upon the same terms
and conditions, to each person, if any, who controls any Underwriter within
the meaning of the Act; and the obligations of the Underwriters under this
Section 8 shall be in addition to any liability which the respective
Underwriters may otherwise have and shall extend, upon the same terms and
conditions, to each officer and director of the Company or the Selling
Stockholder and to each person, if any, who controls the Company or the
Selling Stockholder within the meaning of the Act. The obligations of the
Selling Stockholder under this Section 8 shall not exceed the amount of the
net proceeds received by the Selling Stockholder in connection with the sale
of the Shares hereunder and under the U.S. Underwriting Agreement.
9. (a) If any Underwriter shall default in its obligation to purchase the
Shares which it has agreed to purchase hereunder at a Time of Delivery, you
may in your discretion arrange for you or another party or other parties to
purchase such Shares on the terms contained herein. If within thirty-six
hours after such default by any Underwriter you do not arrange for the
purchase of such Shares, then the Selling Stockholder shall be entitled to a
further period of thirty-six hours within which to procure another party or
other parties satisfactory to you to purchase such Shares on such terms. In
the event that, within the respective prescribed periods, you notify the
Selling Stockholder that you have so arranged for the purchase of such
Shares, or the Selling Stockholder notifies you that it has so arranged for
the purchase of such Shares, you or the Selling Stockholder shall have the
right to postpone such Time of Delivery for a period of not more than seven
days, in order to effect whatever changes may thereby be made necessary in
the Registration Statement or the Prospectus, or in any other documents or
arrangements, and the Company agrees to file promptly any amendments to the
Registration Statement or the Prospectus which in your opinion may thereby be
made necessary. The term "Underwriter" as used in this Agreement shall
include any person substituted under this Section with like effect as if such
person had originally been a party to this Agreement with respect to such
Shares.
(b) If, after giving effect to any arrangements for the purchase of the
Shares of a defaulting Underwriter or Underwriters by you and the Selling
Stockholder as provided in subsection (a) above, the aggregate number of such
Shares which remains unpurchased does not exceed one-eleventh of the
aggregate number of all the Shares to be purchased at such Time of Delivery,
then the Selling Stockholder shall have the right to require each
non-defaulting Underwriter to purchase the number of shares which such
Underwriter agreed to purchase hereunder at such Time of Delivery and, in
addition, to require each non-defaulting Underwriter to purchase its pro rata
share (based on the number of Shares which such Underwriter agreed to
purchase hereunder) of the Shares of such defaulting Underwriter or
Underwriters for which such arrangements have not been made; but nothing
herein shall relieve a defaulting Underwriter from liability for its default.
(c) If, after giving effect to any arrangements for the purchase of the
Shares of a defaulting Underwriter or Underwriters by you and the Selling
Stockholder as provided in subsection (a) above, the aggregate number of such
Shares which remains unpurchased exceeds one-eleventh of the aggregate number
of all the Shares to be purchased at such Time of Delivery, or if the Selling
Stockholder shall not exercise the right described in subsection (b) above to
require non-defaulting Underwriters to purchase
6
Shares of a defaulting Underwriter or Underwriters, then this Agreement (or,
with respect to the Second Time of Delivery, the obligation of the
Underwriters to purchase and of the Selling Stockholder to sell the Optional
Shares) shall thereupon terminate, without liability on the part of any
non-defaulting Underwriter or the Selling Stockholder, except for the
expenses to be borne by the Selling Stockholder and the Underwriters as
provided in Section 6 hereof and the indemnity and contribution agreements in
Section 8 hereof; but nothing herein shall relieve a defaulting Underwriter
from liability for its default.
10. The respective indemnities, agreements, representations, warranties
and other statements of the Company, the Selling Stockholder and the several
Underwriters, as set forth in this Agreement or made by or on behalf of them,
respectively, pursuant to this Agreement, shall remain in full force and
effect, regardless of any investigation (or any statement as to the results
thereof) made by or on behalf of any Underwriter or any controlling person of
any Underwriter, or the Company, or the Selling Stockholder, or any officer
or director or controlling person of the Company, or any controlling person
of the Selling Stockholder, and shall survive delivery of and payment for the
Shares.
11. If this Agreement shall be terminated pursuant to Section 9 hereof,
neither the Company nor the Selling Stockholder shall then be under any
liability to any Underwriter except as provided in Section 6 and Section 8
hereof, but, if for any other reason any Shares are not delivered by or on
behalf of the Selling Stockholder as provided herein, the Selling Stockholder
will reimburse the Underwriters through GSI for all out-of-pocket expenses
approved in writing by GSI, including fees and disbursements of counsel,
reasonably incurred by the Underwriters in making preparations for the
purchase, sale and delivery of the Shares not so delivered, but the Company
and Selling Stockholder shall then be under no further liability to any
Underwriter in respect of the Shares not so delivered except as provided in
Sections 6 and 8 hereof.
12. In all dealings hereunder, you shall act on behalf of each of the
Underwriters, and the parties hereto shall be entitled to act and rely upon
any statement, request, notice or agreement on behalf of any Underwriter made
or given by you jointly or by GSI on your behalf.
All statements, requests, notices and agreements hereunder shall be in
writing, and if to the Underwriters shall be delivered or sent by mail, telex
or facsimile transmission to the Underwriters in care of GSI, Peterborough
Court, 000 Xxxxx Xxxxxx, Xxxxxx XX0X 0XX, Xxxxxxx, Attention: Equity Capital
Markets, Telex No. 94012165, facsimile transmission No. (071) 774-1550; if to
the Selling Stockholder shall be delivered or sent by mail, telex or
facsimile transmission to 00 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Xxxxx X. Xxxxxxxx; and if to the Company shall be delivered or
sent by registered mail, telex or facsimile transmission to the address of
the Company set forth in the Registration Statement, Attention: Secretary;
provided, however, that any notice to an Underwriter pursuant to Section 8(c)
hereof shall be delivered or sent by mail, telex or facsimile transmission to
such Underwriter at its address set forth in its Underwriters' Questionnaire,
or telex constituting such Questionnaire, which address will be supplied to
the Company or the Selling Stockholder by GSI upon request. Any such
statements, requests, notices or agreements shall take effect upon receipt
thereof.
13. This Agreement shall be binding upon, and inure solely to the benefit
of, the Underwriters, the Company and the Selling Stockholder, and, to the
extent provided in Sections 8 and 10 hereof, the officers and directors of
the Company and each person who controls the Company, the Selling Stockholder
or any Underwriter, and their respective heirs, executors, administrators,
successors and assigns, and no other person shall acquire or have any right
under or by virtue of this Agreement. No purchaser of any of the Shares from
any Underwriter shall be deemed a successor or assign by reason merely of
such purchase.
14. Time shall be of the essence of this Agreement.
15. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK, UNITED STATES OF AMERICA.
16. This Agreement may be executed by any one or more of the parties
hereto in any number of counterparts, each of which shall be deemed to be an
original, but all such counterparts shall together constitute one and the
same instrument.
7
If the foregoing is in accordance with your understanding, please sign and
return to us one for the Company, one for the Selling Stockholder and one for
each of the Co-Lead Managers or Lead Managing Underwriters plus one for each
counsel counterparts hereof, and upon the acceptance hereof by you, on behalf
of each of the Underwriters, the Selling Stockholder, this letter and such
acceptance hereof shall constitute a binding agreement among each of the
Underwriters, the Selling Stockholder and the Company. It is understood that
your acceptance of this letter on behalf of each of the Underwriters is
pursuant to the authority set forth in a form of Agreement among Underwriters
(International Version), the form of which shall be furnished to the Company
and the Selling Stockholder for examination upon request, but without
warranty on your part as to the authority of the signers thereof.
Very truly yours,
Consolidated Cigar Holdings Inc.
By:
-------------------------------
Name:
Title:
Mafco Consolidated Group Inc.
By:
-------------------------------
Name:
Title:
Accepted as of the date hereof:
Xxxxxxx Xxxxx International
Xxxxxxx Xxxxx International
Xxxxxx Xxxxxxx & Co. International Limited
By: Xxxxxxx Sachs International
By:
---------------------------------------
(Attorney-in-fact)
On behalf of each of the Underwriters
8
SCHEDULE I
NUMBER OF OPTIONAL
SHARES TO BE
TOTAL NUMBER OF PURCHASED IF
FIRM SHARES MAXIMUM OPTION
UNDERWRITER TO BE PURCHASED EXERCISED
------------------------------------------ --------------- ------------------
Xxxxxxx Xxxxx International ...............
Xxxxxxx Xxxxx International ...............
Xxxxxx Xxxxxxx & Co. International Limited
--------------- ------------------
Total ..................................... 1,000,000 150,000
=============== ==================
9
