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RAYOVAC CORPORATION
(a Wisconsin corporation)
1,340,000 Shares of Common Stock
FORM OF
INTERNATIONAL PURCHASE AGREEMENT
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Dated: November , 1997
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Table of Contents
Page
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INTERNATIONAL PURCHASE AGREEMENT................................................ 1
SECTION 1. Representations and Warranties ................................... 3
(a) Representations and Warranties by the Company ...................... 3
(i) Compliance with Registration Requirements ...................... 3
(ii) Independent Accountants ........................................ 4
(iii) Financial Statements ........................................... 5
(iv) No Material Adverse Change in Business ......................... 5
(v) Good Standing of the Company.................................... 5
(vi) Good Standing of Subsidiaries................................... 5
(vii) Capitalization ................................................. 6
(viii) Authorization of Agreement ..................................... 6
(ix) Authorization and Description of Securities .................... 6
(x) Absence of Defaults and Conflicts .............................. 7
(xi) Absence of Labor Dispute ....................................... 7
(xii) Absence of Proceedings ......................................... 8
(xiii) Accuracy of Exhibits ........................................... 8
(xiv) Possession of Intellectual Property ............................ 8
(xv) Absence of Further Requirements ................................ 8
(xvi) Possession of Licenses and Permits ............................. 9
(xvii) Title to Property .............................................. 9
(xviii) Investment Company Act ......................................... 9
(xix) Environmental Laws ............................................. 9
(xx) Registration Rights ............................................ 10
(xxi) Stabilization or Manipulation .................................. 10
(xxii) Accounting Controls ............................................ 10
(xxiii) Tax Returns .................................................... 10
(xxiv) No Association with NASD ....................................... 11
(b) Representations and Warranties by the Selling Shareholders ......... 11
(i) Accurate Disclosure ............................................ 11
(ii) Authorization of Agreements .................................... 11
(iii) Valid Title .................................................... 12
(iv) Due Execution of Power of Attorney and Custody Agreement ....... 12
(v) Absence of Manipulation ........................................ 13
(vi) Absence of Further Requirements ................................ 13
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(vii) Certificates Suitable for Transfer ....................... 13
(viii) Irrevocable Obligations .................................. 13
(ix) No Association with NASD ................................. 14
(x) Power and Authority ...................................... 14
(b) Officer's Certificates ....................................... 14
SECTION 2. Sale and Delivery to International Managers; Closing ....... 14
(a) Initial Securities ........................................... 14
(b) Option Securities ............................................ 14
(b) Payment ...................................................... 15
(d) Denominations; Registration .................................. 16
(e) Appointment of Qualified Independent Underwriter ............. 16
SECTION 3. Covenants of the Company ................................... 16
(a) Compliance with Securities Regulations and Commission Requests 16
(b) Filing of Amendments ......................................... 16
(c) Delivery of Registration Statements .......................... 17
(d) Delivery of Prospectuses ..................................... 17
(e) Continued Compliance with Securities Laws .................... 17
(f) Blue Sky Qualifications ...................................... 18
(g) Rule 158 ..................................................... 18
(h) Use of Proceeds .............................................. 18
(i) Listing ...................................................... 18
(j) Restriction on Sale of Securities ............................ 18
(k) Reporting Requirements ....................................... 19
(l) Compliance with NASD Rules ................................... 19
SECTION 4. Payment of Expenses ........................................ 19
(a) Expenses ..................................................... 20
(b) Expenses of the Selling Shareholders ......................... 20
(c) Termination of Agreement ..................................... 20
(d) Allocation of Expenses ....................................... 20
SECTION 5. Conditions of International Managers' Obligations .......... 20
(a) Effectiveness of Registration Statement ...................... 20
(b) Opinion of Counsel for Company and the Selling Shareholders .. 20
(c) Opinion of Counsel for International Managers ................ 21
(d) Officers' Certificate ........................................ 21
(e) Selling Shareholders' Certificate ............................ 21
(f) Accountant's Comfort Letter .................................. 22
(g) Bring-down Comfort Letter .................................... 22
(h) Approval of Listing .......................................... 22
(i) No Objection ................................................. 22
(j) Lock-up Agreement ............................................ 22
(k) Purchase of Initial U.S. Securities .......................... 22
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(l) Custody Agreement .............................................. 22
(m) Conditions to Purchase of International Option Securities ...... 22
(n) Additional Documents ........................................... 23
(o) Termination of Agreement ....................................... 23
SECTION 6. Indemnification .............................................. 24
(a) Indemnification of International Managers by the Company ....... 26
(b) Indemnification of the International Managers by
the Selling Shareholders ..................................... 27
(c) Indemnification of Company, Directors and Officers and
Selling Shareholders ......................................... 27
(d) Actions against Parties; Notification .......................... 28
(e) Settlement without Consent if Failure to Reimburse ............. 29
(f) Indemnification for Reserved Securities ........................ 29
(g) Indemnification for Direct Shares .............................. 29
(h) Other Agreements with Respect to Indemnification ............... 29
SECTION 7. Contribution ................................................. 29
SECTION 8. Representations, Warranties and Agreements to Survive Delivery 31
SECTION 9. Termination of Agreement .................................... 31
(a) Termination; General ........................................... 31
(b) Liabilities .................................................... 32
SECTION 10. Default by One or More of the International Managers ........ 32
SECTION 11. Notices ..................................................... 32
SECTION 12. Parties ..................................................... 33
SECTION 13. Governing Law and Time ...................................... 33
SECTION 14. Effect of Headings .......................................... 33
SECTION 15. Counterparts ................................................ 33
SCHEDULES
SCHEDULE A LIST OF UNDERWRITERS
SCHEDULE B LIST OF SELLING SHAREHOLDERS
SCHEDULE C PRICING INFORMATION
SCHEDULE D LIST OF PERSONS SUBJECT TO LOCK-UP
EXHIBITS
EXHIBIT A-1 FORM OF OPINION OF COMPANY'S GENERAL COUNSEL
EXHIBIT A-2 FORM OF OPINION OF COMPANY'S COUNSEL
EXHIBIT A-3 FORM OF OPINION OF SELLING SHAREHOLDERS COUNSEL
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EXHIBIT B FORM OF LOCK-UP LETTER
EXHIBIT C-1 FORM OF COMFORT LETTER OF KPMG PEAT MARWICK LLP
EXHIBIT C-2 FORM OF COMFORT LETTER OF COOPERS & XXXXXXX LLP
RAYOVAC CORPORATION
(a Wisconsin corporation)
1,340,000 Shares of Common Stock
(Par Value $0.01 Per Share)
INTERNATIONAL PURCHASE AGREEMENT
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__________, 1997
XXXXXXX XXXXX INTERNATIONAL
Bear, Xxxxxxx International Limited
Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities Corporation
Xxxxx Xxxxxx Inc.
c/o Merrill Xxxxx International
00 Xxxxxxxxx Xxxxx
Xxxxxx XX0X 0XX
Xxxxxxx
Ladies and Gentlemen:
Rayovac Corporation, a Wisconsin corporation (the "Company") and the
persons listed on Schedule B hereto (the "Selling Shareholders") confirm their
respective agreements with Xxxxxxx Xxxxx International and each of the other
International Managers named in Schedule A hereto (collectively, the
"International Managers," which term shall also include any underwriter
substituted as hereinafter provided in Section 10 hereof), for whom Xxxxxxx
Xxxxx International, Bear, Xxxxxxx & Co. Inc., Xxxxxxxxx, Xxxxxx & Xxxxxxxx
Securities Corporation and Xxxxx Xxxxxx Inc. are acting as representatives (in
such capacity, the "Lead Managers"), with respect to (i) the issue and sale by
the Company and the purchase by the International Managers, acting severally and
not jointly, of the number of shares of Common Stock, par value $0.01 per share,
of the Company ("Common Stock") set forth in Schedule A hereto and (ii) the
grant by the Selling Shareholders, to the International Managers, acting
severally and not jointly, of the option described in Section 2(b) hereof to
purchase all or any part of 201,000 additional shares of Common Stock to cover
over-allotments, if any. The aforesaid shares of Common Stock (the "Initial
International Securities") to be purchased by the International Managers, and
all or any part of the 201,000 shares of Common Stock subject to the option
described in Section 2(b) hereof (the "International Option Securities"), are
hereinafter called, collectively, the "International Securities."
It is understood that the Company is concurrently entering into an
agreement dated the date hereof (the "U.S. Purchase Agreement") providing for
the offering by the Company of an aggregate
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of 5,360,000 shares of Common Stock (the "Initial U.S. Securities") through
arrangements with certain underwriters in the United States and Canada (the
"U.S. Underwriters") for which Xxxxxxx Xxxxx & Co., Xxxxxxx Lynch, Pierce,
Xxxxxx & Xxxxx Incorporated ("Xxxxxxx Xxxxx"), Bear, Xxxxxxx & Co. Inc.,
Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities Corporation and Xxxxx Xxxxxx Inc. are
acting as representatives (the "U.S. Representatives") and the grant by the
Company, to the U.S. Underwriters, acting severally and not jointly, of an
option to purchase all or any part of the U.S. Underwriters' pro rata portion of
up to 804,000 additional shares of Common Stock solely to cover over-allotments,
if any (the "U.S. Option Securities" and, together with the International Option
Securities, the "Option Securities"). The Initial U.S. Securities and the U.S.
Option Securities are hereinafter called the "U.S. Securities." It is understood
that the Company is not obligated to sell and the International Managers are not
obligated to purchase, any Initial International Securities unless all of the
Initial U.S. Securities are contemporaneously purchased by the U.S.
Underwriters.
The International Managers and the U.S. Underwriters are hereinafter
collectively called the "Underwriters," the Initial International Securities and
the Initial U.S. Securities are hereinafter collectively called the "Initial
Securities," and the International Securities and the U.S. Securities are
hereinafter collectively called the "Securities."
The Underwriters will concurrently enter into an Intersyndicate
Agreement of even date herewith (the "Intersyndicate Agreement") providing for
the coordination of certain transactions among the Underwriters under the
direction of Xxxxxxx Xxxxx & Co., Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated (in such capacity, the "Global Coordinator").
The Company and the Selling Shareholders understand that the
International Managers propose to make a public offering of the International
Securities as soon as the Lead Managers deem advisable after this Agreement has
been executed and delivered.
The Company and the International Managers agree that up to 530,000 of
the shares of Common Stock to be purchased by the Underwriters (the "Reserved
Securities") shall be reserved for sale by the Underwriters to certain eligible
employees and persons having relationships with the Company as part of the
distribution of the Securities by the Underwriters, subject to the terms of this
Agreement, the applicable rules, regulations and interpretations of the National
Association of Securities Dealers, Inc. and all other applicable laws, rules and
regulations. To the extent that such Reserved Securities are not orally
confirmed for purchase by such eligible employees and persons having
relationships with the Company by the end of the first business day after the
date of this Agreement, such Reserved Securities may be offered to the public as
part of the public offering contemplated hereby. In addition, the Company is
concurrently offering up to 270,000 shares of Common Stock (the "Direct Shares")
directly to certain employee participants in the Company's Profit Sharing and
Savings Plan pursuant to a separate prospectus included in the Registration
Statement (as defined below).
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-1 (No. 333-35181), as amended
by Amendment No. 1 thereto, covering the registration of the Securities under
the Securities Act of 1933, as amended (the "1933 Act"), including the related
preliminary prospectus or prospectuses. Promptly after execution and delivery of
this Agreement, the Company will either (i) prepare and file a prospectus in
accordance
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with the provisions of Rule 430A ("Rule 430A") of the rules and regulations of
the Commission under the 1933 Act (the "1933 Act Regulations") and paragraph (b)
of Rule 424 ("Rule 424(b)") of the 1933 Act Regulations, or (ii) if the Company
has elected to rely upon Rule 434 ("Rule 434") of the 1933 Act Regulations,
prepare and file a term sheet (a "Term Sheet") in accordance with the provisions
of Rule 434 and Rule 424(b). Two forms of prospectus are to be used in
connection with the offering and sale of the Securities: one relating to the
International Securities (the "Form of International Prospectus") and one
relating to the U.S. Securities (the "Form of U.S. Prospectus"). The Form of
U.S. Prospectus is identical to the Form of International Prospectus, except for
the front cover and back cover pages and the information under the caption
"Underwriting." The information included in any such prospectus or in any such
Term Sheet, as the case may be, that was omitted from such registration
statement at the time it became effective but that is deemed to be part of such
registration statement at the time it became effective (a) pursuant to paragraph
(b) of Rule 430A is referred to as "Rule 430A Information" or (b) pursuant to
paragraph (d) of Rule 434 is referred to as "Rule 434 Information." Each Form of
International Prospectus and Form of U.S. Prospectus used before such
registration statement became effective, and any prospectus that omitted, as
applicable, the Rule 430A Information or the Rule 434 Information, that was used
after such effectiveness and prior to the execution and delivery of this
Agreement, is herein called a "preliminary prospectus." Such registration
statement, including the exhibits thereto and schedules thereto at the time it
became effective and including the Rule 430A Information and the Rule 434
Information, as applicable, is herein called the "Registration Statement." Any
registration statement filed pursuant to Rule 462(b) of the 1933 Act Regulations
is herein referred to as the "Rule 462(b) Registration Statement," and after
such filing the term "Registration Statement" shall include the Rule 462(b)
Registration Statement. The final Form of International Prospectus and the final
Form of U.S. Prospectus in the forms first furnished to the Underwriters for use
in connection with the offering of the Securities are herein called the
"International Prospectus" and the "U.S. Prospectus," respectively, and
collectively, the "Prospectuses." If Rule 434 is relied on, the terms
"International Prospectus" and "U.S. Prospectus" shall refer to the preliminary
International Prospectus dated October 31, 1997 and the preliminary U.S.
Prospectus dated October 31, 1997, respectively, each together with the
applicable Term Sheet, and all references in this Agreement to the date of such
Prospectuses shall mean the date of the applicable Term Sheet. For purposes of
this Agreement, all references to the Registration Statement, any preliminary
prospectus, the International Prospectus, the U.S. Prospectus or any Term Sheet
or any amendment or supplement to any of the foregoing shall be deemed to
include the copy filed with the Commission pursuant to its Electronic Data
Gathering, Analysis and Retrieval system ("XXXXX").
SECTION 1. Representations and Warranties.
(a) Representations and Warranties by the Company. The Company
represents and warrants to each International Manager as of the date hereof, as
of the Closing Time referred to in Section 2(c) hereof, and as of each Date of
Delivery (if any) referred to in Section 2(b) hereof, and agrees with each
International Manager, as follows:
(i) Compliance with Registration Requirements. Each of the
Registration Statement and any Rule 462(b) Registration Statement has
become effective under the 1933 Act and no stop order suspending the
effectiveness of the Registration Statement or any
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Rule 462(b) Registration Statement has been issued under the 1933 Act and no
proceedings for that purpose have been instituted or are pending or, to the
knowledge of the Company, are contemplated by the Commission, and any request on
the part of the Commission for additional information has been complied with.
At the respective times the Registration Statement, any Rule 462(b)
Registration Statement and any post-effective amendments thereto became
effective and at the Closing Time (and, if any International Option Securities
are purchased, at the Date of Delivery), the Registration Statement, the Rule
462(b) Registration Statement and any amendments and supplements thereto
complied and will comply in all material respects with the requirements of the
1933 Act and the 1933 Act Regulations and did not and will not contain an untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not misleading, and
the Prospectuses, any preliminary prospectuses and any supplement thereto or
prospectus wrapper prepared in connection therewith, at their respective times
of issuance and at the Closing Time, complied and will comply in all material
respects with any applicable laws or regulations of foreign jurisdictions in
which the Prospectuses and such preliminary prospectuses, as amended or
supplemented, if applicable, are distributed in connection with the offer and
sale of Reserved Securities. Neither of the Prospectuses nor any amendments or
supplements thereto (including any prospectus wrapper), at the time the
Prospectuses or any amendments or supplements thereto were issued and at the
Closing Time (and, if any International Option Securities are purchased, at the
Date of Delivery), included or will include, at the aforesaid times, an untrue
statement of a material fact or omitted or will omit, at the aforesaid times, to
state a material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading. If Rule
434 is used, the Company will comply with the requirements of Rule 434 and the
Prospectuses shall not be "materially different," as such term is used in Rule
434, from the prospectuses included in the Registration Statement at the time it
became effective. The representations and warranties in this subsection shall
not apply to statements in or omissions from the Registration Statement or the
Prospectuses made in reliance upon and in conformity with information furnished
to the Company in writing by any Underwriter through the Lead Managers or the
U.S. Representatives expressly for use in the Registration Statement or the
Prospectuses.
Each preliminary prospectus and the prospectuses filed as part of the
Registration Statement as originally filed or as part of any amendment thereto,
or filed pursuant to Rule 424 under the 1933 Act, complied when so filed in all
material respects with the 1933 Act Regulations and each preliminary prospectus
and the Prospectuses delivered to the Underwriters for use in connection with
this offering was identical to the electronically transmitted copies thereof
filed with the Commission pursuant to XXXXX, except to the extent permitted by
Regulation S-T.
(ii) Independent Accountants. The accountants who certified
the financial statements and supporting schedules included in the
Registration Statement are independent public accountants as required
by the 1933 Act and the 1933 Act Regulations.
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(iii) Financial Statements. The historical financial
statements included in the Registration Statement and the Prospectuses,
together with the related schedule and notes, present fairly the
financial position of the Company and its consolidated Subsidiaries (as
defined below) at the dates indicated and the statement of operations,
shareholders' equity and cash flows of the Company and its consolidated
Subsidiaries for the periods specified; said financial statements have
been prepared in conformity with generally accepted accounting
principles ("GAAP") applied on a consistent basis throughout the
periods involved. The supporting schedules included in the Registration
Statement present fairly in accordance with GAAP the information
required to be stated therein. The selected financial data and the
summary financial information included in the Prospectuses present
fairly the information shown therein and have been compiled on a basis
consistent with that of the audited financial statements included in
the Registration Statement. The pro forma financial data and the
related notes thereto included in the Registration Statement and the
Prospectuses present fairly the information shown therein and have been
prepared in accordance with the Commission's rules and guidelines with
respect to pro forma financial statements and have been properly
compiled on the bases described therein, and the assumptions used in
the preparation thereof are reasonable and the adjustments used therein
are appropriate to give effect to the transactions and circumstances
referred to therein.
(iv) No Material Adverse Change in Business. Since the
respective dates as of which information is given in the Registration
Statement and the Prospectuses, except as otherwise stated therein, (A)
there has been no material adverse change in 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"), (B) there have been no transactions entered into by the
Company or any of its Subsidiaries, other than those in the ordinary
course of business, which are material with respect to the Company and
its Subsidiaries considered as one enterprise, and (C) there has been
no dividend or distribution of any kind declared, paid or made by the
Company on any class of its capital stock.
(v) Good Standing of the Company. The Company has been duly
organized and is validly existing as a corporation in good standing
under the laws of the State of Wisconsin and has corporate power and
authority to own, lease and operate its properties and to conduct its
business as described in the Prospectuses and to enter into and perform
its obligations under this Agreement; and the Company is duly qualified
as a foreign corporation to transact business and is in good standing
in each other jurisdiction in which such qualification is required,
whether by reason of the ownership or leasing of property or the
conduct of business, except where the failure so to qualify or to be in
good standing would not result in a Material Adverse Effect.
(vi) Good Standing of Subsidiaries. Each subsidiary of the
Company (each a "Subsidiary" and, collectively, the "Subsidiaries") has
been duly organized and is validly existing as a corporation in good
standing under the laws of the jurisdiction of its incorporation, has
corporate power and authority to own, lease and operate its properties
and to conduct its business as described in the Prospectuses and is
duly qualified as a
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foreign corporation to transact business and is in good
standing in each jurisdiction in which such qualification is required,
whether by reason of the ownership or leasing of property or the
conduct of business, except where the failure so to qualify or to be in
good standing would not result in a Material Adverse Effect; except as
otherwise disclosed in the Registration Statement, all of the issued
and outstanding capital stock of each such Subsidiary has been duly
authorized and validly issued, is fully paid and non-assessable in
jurisdictions where such legal concepts are recognized and is owned by
the Company, directly or through Subsidiaries, free and clear of any
security interest, mortgage, pledge, lien, encumbrance, claim or equity
(except as set forth in the Registration Statement and except for any
director or member qualifying shares); none of the outstanding shares
of capital stock of any Subsidiary was issued in violation of the
preemptive or similar rights of any securityholder of such Subsidiary.
The only Subsidiaries of the Company are the subsidiaries listed on
Exhibit 21 to the Registration Statement and, except for Rayovac Europe
Limited (which represents less than 15% of the assets, liabilities and
earnings of the Company) the Company has no "significant subsidiaries"
as defined in Section 1-02 of Regulation S-X.
(vii) Capitalization. After giving effect to the amendment and
restatement of the Amended and Restated Articles of Incorporation of
the Company to be effective prior to the Closing Time, the authorized,
issued and outstanding capital stock of the Company is as set forth in
the Prospectuses in the column entitled "Actual" under the caption
"Capitalization" (except for subsequent issuances, if any, pursuant to
this Agreement, pursuant to reservations, agreements or employee
benefit plans referred to in the Prospectuses or pursuant to the
exercise of convertible securities or options referred to in the
Prospectuses). The shares of issued and outstanding capital stock of
the Company have been and at the Closing Time, including the
International Option Securities to be purchased by the International
Managers from the Selling Shareholders, will have been duly authorized
and validly issued and are or will be fully paid and non-assessable;
none of the outstanding shares of capital stock of the Company was or
as of the Closing Time, including the International Option Securities
to be purchased by the International Managers from the Selling
Shareholders, will have been or was issued in violation of the
preemptive or other similar rights of any securityholder of the
Company.
(viii) Authorization of Agreement. This Agreement and the U.S.
Purchase Agreement have been duly authorized, executed and delivered by
the Company.
(ix) Authorization and Description of Securities. The
Securities to be purchased by the International Managers and the U.S.
Underwriters from the Company have been duly authorized for issuance
and sale to the International Managers pursuant to this Agreement and
the U.S. Underwriters pursuant to the U.S. Purchase Agreement,
respectively, and, when issued and delivered by the Company pursuant to
this Agreement and the U.S. Purchase Agreement, respectively, against
payment of the consideration set forth herein and the U.S. Purchase
Agreement, respectively, will be validly issued, fully paid and
non-assessable; the Direct Shares to be offered and sold separately by
the Company have been duly authorized by the Company and when issued
and delivered by the Company against payment therefor will be validly
issued, fully paid and non-assessable; the Common
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Stock conforms to the descriptions thereof contained under
"Description of Capital Stock" in the Prospectuses and such description
conforms to the rights set forth in the instruments defining the same;
no holder of the Securities will be subject to personal liability by
reason of being such a holder; and the issuance of the Securities is
not subject to the preemptive or other similar rights of any
securityholder of the Company.
(x) Absence of Defaults and Conflicts. Neither the Company nor
any of its Subsidiaries is in violation of its charter or by-laws or in
default in the performance or observance of any obligation, agreement,
covenant or condition contained in any contract, indenture, mortgage,
deed of trust, loan or credit agreement, note, lease or other agreement
or instrument to which the Company or any of its Subsidiaries is a
party or by which it or any of them may be bound, or to which any of
the property or assets of the Company or any Subsidiary is subject
(collectively, "Agreements and Instruments") except for such defaults
that would not result in a Material Adverse Effect; and the execution,
delivery and performance of this Agreement and the U.S. Purchase
Agreement and the consummation of the transactions contemplated in this
Agreement, the U.S. Purchase Agreement and in the Registration
Statement (including the issuance and sale of the Securities (and the
Direct Shares) and the use of the proceeds from the sale of the
Securities (and the Direct Shares) as described in the Prospectuses
under the caption "Use of Proceeds") and the compliance by the Company
with its obligations under this Agreement and the U.S. Purchase
Agreement have been duly authorized by all necessary corporate action
and do not and will not, whether with or without the giving of notice
or passage of time or both, conflict with or constitute a breach of, or
default or Repayment Event (as defined below) under, or result in the
creation or imposition of any lien, charge or encumbrance upon any
property or assets of the Company or any Subsidiary pursuant to, the
Agreements and Instruments which would reasonably be expected, either
singly or in the aggregate to result in a Material Adverse Effect, nor
will such action result in any violation of any applicable law,
statute, rule, regulation, judgment, order, writ or decree of any
government, government instrumentality or court, domestic or foreign,
having jurisdiction over the Company or any Subsidiary or any of their
assets, properties or operations, including specifically but without
limitation with respect to the Direct Shares any violation of the
Employee Retirement Income Security Act, which would reasonably be
expected, either singly or in the aggregate to result in a Material
Adverse Effect; nor will such action result in any violation of the
provisions of the charter or by-laws of the Company or any Subsidiary.
As used herein, a "Repayment Event" means any event or condition which
gives the holder of any note, debenture or other evidence of
indebtedness (or any person acting on such holder's behalf) the right
to require the repurchase, redemption or repayment of all or a portion
of such indebtedness by the Company or any Subsidiary.
(xi) Absence of Labor Dispute. Except as described in the
Registration Statement with respect to the renegotiation of collective
bargaining agreements, (i) no labor dispute with the employees of the
Company or any Subsidiary exists or, to the knowledge of the Company,
is imminent, and (ii) the Company is not aware of any existing or
imminent labor disturbance by the employees of any of its or any
Subsidiary's principal suppliers, manufacturers, customers, dealers or
contractors, which, in either case, may reasonably be expected to
result in a Material Adverse Effect.
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(xii) Absence of Proceedings. There is no action, suit,
proceeding, inquiry or investigation before or brought by any court or
governmental agency or body, domestic or foreign, now pending, or, to
the knowledge of the Company, threatened, against or affecting the
Company or any Subsidiary, which is required to be disclosed in the
Registration Statement (other than as disclosed therein), or which
might reasonably be expected to result in a Material Adverse Effect, or
which might reasonably be expected to materially and adversely affect
the properties or assets thereof or the consummation of the
transactions contemplated in this Agreement and the U.S. Purchase
Agreement or the performance by the Company of its obligations
hereunder or thereunder; the aggregate of all pending legal or
governmental proceedings to which the Company or any Subsidiary is a
party or of which any of their respective property or assets is the
subject which are not described in the Registration Statement,
including ordinary routine litigation incidental to the business of the
Company and its Subsidiaries would not reasonably be expected to result
in a Material Adverse Effect.
(xiii) Accuracy of Exhibits. There are no contracts or
documents which are required to be described in the Registration
Statement or the Prospectuses or to be filed as exhibits thereto which
have not been so described and filed as required.
(xiv) Possession of Intellectual Property. Except as described
in the Registration Statement, the Company and its Subsidiaries own or
possess the right to utilize, or can acquire on reasonable terms,
adequate patents, patent rights, licenses, inventions, copyrights,
know-how (including trade secrets and other unpatented and/or
unpatentable proprietary or confidential information, systems or
procedures), trademarks, service marks, trade names or other
intellectual property (collectively, "Intellectual Property") necessary
to carry on the business now operated by them, and neither the Company
nor any of its Subsidiaries has received any notice or is otherwise
aware of any infringement of or conflict with asserted rights of others
with respect to any Intellectual Property or of any facts or
circumstances which would render any Intellectual Property invalid or
inadequate to protect the interest of the Company or any of its
Subsidiaries therein, and which infringement or conflict (if the
subject of any unfavorable decision, ruling or finding) or invalidity
or inadequacy, singly or in the aggregate, would result in a Material
Adverse Effect.
(xv) Absence of Further Requirements. No filing with, or
authorization, approval, consent, license, order, registration,
qualification or decree of, any court or governmental authority or
agency is necessary or required for the performance by the Company of
its obligations hereunder, in connection with the offering, issuance or
sale of the Securities under this Agreement and the U.S. Purchase
Agreement or the consummation of the transactions contemplated by this
Agreement and the U.S. Purchase Agreement, except (i) such as have been
already obtained or as may be required under the 1933 Act or the 1933
Act Regulations and foreign or state securities or blue sky laws or the
rules or regulations of the NASD and (ii) such as have been obtained
under the laws and regulations of jurisdictions outside the United
States in which the Reserved Securities are offered.
-8-
(xvi) Possession of Licenses and Permits. The Company and its
Subsidiaries possess such permits, licenses, approvals, consents and
other authorizations (collectively, "Governmental Licenses") issued by
the appropriate federal, state, local or foreign regulatory agencies or
bodies necessary to conduct the business now operated by them, except
where the failure to possess the same would not, singly or in the
aggregate have a Material Adverse Effect; the Company and its
Subsidiaries are in compliance with the terms and conditions of all
such Governmental Licenses, except where the failure so to comply would
not, singly or in the aggregate, have a Material Adverse Effect; all of
the Governmental Licenses are valid and in full force and effect,
except when the invalidity of such Governmental Licenses or the failure
of such Governmental Licenses to be in full force and effect would not
have a Material Adverse Effect; and neither the Company nor any of its
Subsidiaries has received any notice of proceedings relating to the
revocation or modification of any such Governmental Licenses which,
singly or in the aggregate, if the subject of an unfavorable decision,
ruling or finding, would result in a Material Adverse Effect.
(xvii) Title to Property. The Company and its Subsidiaries
have good and marketable title to all real property owned by the
Company and its Subsidiaries and good title to all other properties
owned by them, in each case, free and clear of all mortgages, pledges,
liens, security interests, claims, restrictions or encumbrances of any
kind except such as (a) are described in the Prospectuses or (b) do
not, singly or in the aggregate, materially affect the value of such
property and do not interfere with the use made and proposed to be made
of such property by the Company or any of its Subsidiaries or (c) would
not reasonably be expected to result in a Material Adverse Effect; and
all of the leases and subleases material to the business of the Company
and its Subsidiaries, considered as one enterprise, and under which the
Company or any of its Subsidiaries holds properties described in the
Prospectuses, are in full force and effect, and neither the Company nor
any Subsidiary has any notice of any claim of any sort that has been
asserted by anyone adverse to the rights of the Company or any
Subsidiary under any of the leases or subleases mentioned above, or
affecting or questioning the rights of the Company or such Subsidiary
to the continued possession of the leased or subleased premises under
any such lease or sublease which would reasonably be expected to result
in a Material Adverse Effect.
(xviii) Investment Company Act. The Company is not, and upon
the issuance and sale of the Securities as herein contemplated and the
application of the net proceeds therefrom as described in the
Prospectuses 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 "1940 Act").
(xix) Environmental Laws. Except as described in the
Registration Statement and except as would not, singly or in the
aggregate, result in a Material Adverse Effect, (A) neither the Company
nor any of its Subsidiaries is in violation of any federal, state,
local or foreign statute, law, rule, regulation, ordinance, code,
policy or rule of common law or any judicial or administrative
interpretation thereof, including any judicial or administrative
-9-
order, consent decree or judgment, relating to pollution or
protection of human health, the environment (including, without
limitation, ambient air, surface water, groundwater, land surface or
subsurface strata) or wildlife, including, without limitation, laws and
regulations relating to the release or threatened release of chemicals,
pollutants, contaminants, wastes, toxic substances, hazardous
substances, petroleum or petroleum products (collectively, "Hazardous
Materials") or to the manufacture, processing, distribution, use,
treatment, storage, disposal, transport or handling of Hazardous
Materials (collectively, "Environmental Laws"), (B) the Company and its
Subsidiaries have all permits, licenses, authorizations and approvals
currently required for their respective businesses and for the
businesses contemplated to be conducted upon consummation of the
offering of the Securities under any applicable Environmental Laws and
are each in compliance with their requirements, (C) there are no
pending or threatened administrative, regulatory or judicial actions,
suits, demands, demand letters, claims, liens, notices of noncompliance
or violation, investigation or proceedings relating to any
Environmental Law against the Company or any of its Subsidiaries and
(D) there are no events, facts or circumstances that might reasonably
be expected to form the basis of any liability or obligation of the
Company or any of its Subsidiaries, including, without limitation, any
order, decree, plan or agreement requiring clean-up or remediation, or
any action, suit or proceeding by any private party or governmental
body or agency, against or affecting the Company or any of its
Subsidiaries relating to any Hazardous Materials or any Environmental
Laws.
(xx) Registration Rights. There are no persons with
registration rights or other similar rights to have any securities
registered pursuant to the Registration Statement under the 1933 Act.
Except as described in the Registration Statement, there are no persons
with registration rights or other similar rights to have any securities
registered by the Company under the 1933 Act.
(xxi) Stabilization or Manipulation. Neither the Company nor
any of its officers, directors or controlling persons has taken,
directly or indirectly, any action designed to cause or to result in,
or that has constituted or which might reasonably be expected to
constitute, the stabilization or manipulation of the price of any
security of the Company to facilitate the sale of the Securities.
(xxii) Accounting Controls. The Company and its Subsidiaries
maintain a system of internal accounting controls sufficient to provide
reasonable assurances that (A) transactions are executed in accordance
with management's general or specific authorization; (B) transactions
are recorded as necessary to permit preparation of financial statements
in conformity with generally accepted accounting principles and to
maintain accountability for assets; (C) access to assets is permitted
only in accordance with management's general or specific authorization;
and (D) the recorded accountability for assets is compared with the
existing assets at reasonable intervals and appropriate action is taken
with respect to any differences.
(xxiii) Tax Returns. The Company and its Subsidiaries have
filed all federal, state, local and foreign tax returns that are
required to have been filed by them pursuant to applicable foreign,
federal, state, local or other law or have duly requested extensions
-10-
thereof, except insofar as the failure to file such returns or
request such extensions would not reasonably be expected to result in a
Material Adverse Effect, and has paid all taxes due pursuant to such
returns or pursuant to any assessment received by the Company and its
Subsidiaries, except for such taxes or assessments, if any, as are
being contested in good faith and as to which adequate reserves have
been provided or where the failure to pay would not reasonably be
expected to result in a Material Adverse Effect. The charges, accruals
and reserves on the books of the Company in respect of any income and
corporation tax liability of the Company and each Subsidiary for any
years not finally determined are adequate to meet any assessments or
re-assessments for additional income tax for any years not finally
determined, except to the extent of any inadequacy that would not
reasonably be expected to result in a Material Adverse Effect.
(xxiv) No Association with NASD. Neither the Company nor any
of its affiliates (within the meaning of NASD Conduct Rule
2720(b)(1)(a)) directly, or indirectly through one or more
intermediaries, controls, or is controlled by, or is under common
control with, or is an associated person (within the meaning of Article
I, Section 1(q) of the By-laws of the National Association of
Securities Dealers, Inc.), of any member firm of the National
Association of Securities Dealers, Inc., other than as described on an
appendix to the Selling Shareholders' Power of Attorney and Custody
Agreement (as defined herein).
b) Representations and Warranties by the Selling Shareholders. Each
Selling Shareholder, severally and not jointly, represents and warrants to each
International Manager as of the date hereof, as of the Closing Time, and, if
such Selling Shareholder is selling International Option Securities on a Date of
Delivery, as of each such Date of Delivery, and agrees with each International
Manager, as follows:
(i) Accurate Disclosure. (A) The information furnished in
writing by or on behalf of such Selling Shareholder expressly for use
in the Registration Statement and any amendments or supplements thereto
does not contain an untrue statement of a material fact with respect to
such Selling Shareholder or omit to state a material fact with respect
to such Selling Shareholder required to be stated therein or necessary
to make the statements regarding the Selling Shareholder therein not
misleading and (B) the information furnished in writing by or on behalf
of such Selling Shareholder expressly for use in the Prospectus does
not include an untrue statement of a material fact with respect to such
Selling Shareholder or omit to state a material fact with respect to
such Selling Shareholder necessary in order to make the statements
regarding the Selling Shareholder therein, in the light of the
circumstances under which they were made, not misleading.
(ii) Authorization of Agreements. Such Selling Shareholder has
the full right, power and authority to enter into this Agreement and
the Power of Attorney and Custody Agreement (the "Power of Attorney and
Custody Agreement") with [Firstar Bank], as custodian (the
"Custodian"), and the attorneys-in-fact named therein (each an
"Attorney-in-Fact"), and to sell, transfer and deliver the Securities
to be sold by such Selling Shareholder hereunder. The execution and
delivery of this Agreement and the Power of Attorney and Custody
Agreement and the sale and delivery of the International Option
Securities to be sold by such Selling Shareholder and the consummation
of the transactions contemplated
-11-
herein and compliance by such Selling Shareholder with its
obligations hereunder have been duly authorized by such Selling
Shareholder and do not and will not, whether with or without the giving
of notice or passage of time or both, conflict with or constitute a
breach of, or default under, or result in the creation or imposition of
any tax, lien, charge or encumbrance upon the Securities to be sold by
such Selling Shareholder or any property or assets of such Selling
Shareholder pursuant to any contract, indenture, mortgage, deed of
trust, loan or credit agreement, note, license, lease or other
agreement or instrument to which such Selling Shareholder is a party or
by which such Selling Shareholder may be bound, or to which any of the
property or assets of such Selling Shareholder is subject (except for
such conflicts, breaches or defaults or liens, charges or encumbrances
that would not result in a material adverse change in the condition
(financial or otherwise), earnings, business affairs or business
prospects of such Selling Shareholder (a "Selling Shareholder Material
Adverse Effect"), whether or not arising in the ordinary course of
business), nor will such action result in any violation of the
provisions of the charter or by-laws or other organizational instrument
of such Selling Shareholder, if applicable, or any applicable treaty,
law, statute, rule, regulation, judgment, order, writ or decree of any
government, government instrumentality or court, domestic or foreign,
having jurisdiction over such Selling Shareholder or any of its
properties which would reasonably be expected, either singly or in the
aggregate to result in a Selling Shareholder Material Adverse Effect.
(iii) Valid Title. Such Selling Shareholder has on the date
hereof and will at the Closing Time and on the Date of Delivery have
good and valid title to the International Option Securities to be sold
by such Selling Shareholder hereunder, free and clear of any security
interest, mortgage, pledge, lien, charge, claim, equity or encumbrance
of any kind, other than pursuant to this Agreement; and upon delivery
of such International Option Securities and payment of the purchase
price therefor as herein contemplated, assuming each such Underwriter
has no notice of any adverse claim as such term is used in the Uniform
Commercial Code, each of the Underwriters will receive valid title to
the International Option Securities purchased by it from such Selling
Shareholder, free and clear of any security interest, mortgage, pledge,
lien, charge, claim, equity or encumbrance of any kind.
(iv) Due Execution of Power of Attorney and Custody Agreement.
Each such Selling Shareholder has duly executed and delivered a Power
of Attorney and Custody Agreement; the Custodian is authorized by each
such Selling Shareholder to deliver the International Option Securities
to be sold by such Selling Shareholder hereunder and to accept payment
therefor; and each Attorney-in-Fact named in the Power of Attorney and
Custody Agreement executed by such Selling Shareholder is authorized by
such Selling Shareholder to execute and deliver this Agreement and the
certificate referred to in Section 5(e) of this Agreement or that may
be required pursuant to Sections 5(m) or 5(n) of this Agreement on
behalf of such Selling Shareholder, to sell, assign and transfer to the
International Managers the International Option Securities to be sold
by such Selling Shareholder hereunder, to determine the purchase price
to be paid by the U.S. Underwriters to such Selling Shareholder, as
provided in Section 2(a) hereof, to authorize the delivery of the
Securities to be sold by such Selling Shareholder hereunder, to accept
payment therefor,
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and otherwise to act on behalf of such Selling Shareholder in
connection with this Agreement.
(v) Absence of Manipulation. Such Selling Shareholder has not
taken, and will not take, directly or indirectly, any action which is
designed to or which has constituted or which might reasonably be
expected to cause or result in stabilization or manipulation of the
price of any security of the Company to facilitate the sale or resale
of the International Option Securities.
(vi) Absence of Further Requirements. No filing with, or
consent, approval, authorization, order, registration, qualification or
decree of, any court or governmental authority or agency, domestic or
foreign, is necessary or required for the performance by each such
Selling Shareholder of their obligations hereunder or in the Power of
Attorney and Custody Agreement, or in connection with the sale and
delivery of the International Option Securities being sold by each such
Selling Shareholder hereunder or the consummation of the transactions
contemplated by this Agreement, except such as may have previously been
made or obtained or as may be required under the 1933 Act or the 1933
Act Regulations or state or foreign securities laws or under the rules
of the National Association of Securities Dealers, Inc.
(vii) Certificates Suitable for Transfer. Certificates for all
of the International Option Securities to be sold by such Selling
Shareholder pursuant to this Agreement, in suitable form for transfer
by delivery or accompanied by duly executed instruments of transfer or
assignment in blank with signatures guaranteed, have been placed in
custody with the Custodian with irrevocable conditional instructions to
deliver such International Option Securities to the International
Managers pursuant to this Agreement.
(viii) Irrevocable Obligations. The International Option
Securities represented by the Certificates held in custody for such
holder under the Custody Agreement are subject to the interests of the
International Managers hereunder; the arrangements made by such holder
for such custody, and the appointment by such holder of the
Attorneys-in-fact by the Power of Attorney, are to that extent
irrevocable; the obligations of such holder hereunder shall not be
terminated, except as provided in the Agreement or in the Power of
Attorney, by operation of law, whether by the death or incapacity of
any individual Selling Shareholder or, in the case of an estate or
trust, by the death or incapacity of any executor or trustee or the
termination of such trust estate or trust, or in the case of a
partnership or corporation, by the dissolution of such partnership or
corporation, or by the occurrence of any other event, if any individual
Selling Shareholder or any such executor or trustee should die or
become incapacitated, or if any such estate or trust should be
terminated, or any such partnership or corporation should be dissolved,
or if any other event should occur, before the delivery of the
International Option Securities hereunder, certificates representing
the International Option Securities shall be delivered by or on behalf
of such holder in accordance with the terms and conditions of this
Agreement and of the Custody Agreements; and actions taken by the
Attorney-in-Fact pursuant to the Powers of Attorney shall be as valid
as if such death, incapacity, termination, dissolution or other event
had not
-13-
occurred, regardless of whether or not the Custodian, Attorney-in-Fact,
or any of them, shall have received notice of such death, incapacity,
termination, dissolution or other event.
(ix) No Association with NASD. Neither such Selling
Shareholder nor any of its affiliates (within the meaning of NASD
Conduct Rule 2720(b)(1)(a)) directly, or indirectly through one or more
intermediaries, controls, or is controlled by, or is under common
control with, or is an associated person (within the meaning of Article
I, Section 1(q) of the By-laws of the National Association of
Securities Dealers, Inc.), of, any member firm of the National
Association of Securities Dealers, Inc., other than as described on an
appendix to the Power of Attorney and Custody Agreement to which such
Selling Shareholder is a party.
(x) Power and Authority. If such Selling Shareholder is a
corporation, partnership or trust, such Selling Shareholder has been
duly organized or incorporated and is validly existing as a corporation
or partnership or limited partnership in good standing under the laws
of its jurisdiction of incorporation or organization, if applicable,
and has the power and authority to own its property and to conduct its
business and is duly qualified to transact business and is in good
standing in each jurisdiction in which the conduct of its business or
its ownership or leasing of property requires such qualification,
except to the extent that the failure to be so qualified or be in good
standing would not result in a material adverse change in the condition
(financial or otherwise), earnings, business affairs or business
prospects of each the Selling Shareholders, whether or not arising in
the ordinary course of business, or materially impair its ability to
consummate the transactions contemplated hereby.
(b) Officer's Certificates. Any certificate signed by any officer of
the Company or any of its Subsidiaries delivered to the Global Coordinator, the
Lead Managers or to counsel for the International Managers shall be deemed a
representation and warranty by the Company to each International Manager as to
the matters covered thereby; and any certificate signed by or on behalf of any
Selling Shareholder as such and delivered to the International Managers or to
counsel for the International Managers pursuant to the terms of this Agreement
shall be deemed a representation and warranty by such Selling Shareholder, as
the case may be, to the International Managers as to the matters covered
thereby.
SECTION 2. Sale and Delivery to International Managers; Closing.
(a) Initial Securities. On the basis of the representations and
warranties herein contained and subject to the terms and conditions herein set
forth, the Company agrees to sell to each International Manager, severally and
not jointly, to the extent indicated on Schedule A hereto, and each
International Manager, severally and not jointly, agrees to purchase from the
Company, at the price per share set forth in Schedule C, the number of Initial
International Securities set forth in Schedule A opposite the name of such
International Manager, plus any additional number of Initial International
Securities which such Underwriter may become obligated to purchase pursuant to
the provisions of Section 10 hereof.
(b) Option Securities. In addition, on the basis of the representations
and warranties herein contained and subject to the terms and conditions herein
set forth, the Selling Shareholders,
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severally and not jointly, hereby grant an option to the International Managers,
severally and not jointly, to purchase up to an additional 201,000 shares of
Common Stock to the extent indicated on Schedule B, at the price per share set
forth in Schedule C, less an amount per share equal to any dividends or
distributions declared by the Company and payable on the Initial International
Securities but not payable on the International Option Securities. The option
hereby granted will expire 30 days after the date hereof and may be exercised in
whole or in part from time to time on one or more occasions only for the purpose
of covering over-allotments which may be made in connection with the offering
and distribution of the Initial International Securities upon notice by the
Global Coordinator to the Selling Shareholders setting forth the number of
International Option Securities as to which the several International Managers
are then exercising the option and the time and date of payment and delivery for
such International Option Securities. Any such time and date of delivery for the
International Option Securities (a "Date of Delivery") shall be determined by
the Global Coordinator, but shall not be later than seven full business days
after the exercise of said option, nor in any event prior to the Closing Time,
as hereinafter defined. If the option is exercised as to all or any portion of
the International Option Securities, each of the International Managers, acting
severally and not jointly, will purchase that proportion of the total number of
International Option Securities then being purchased which the number of Initial
International Securities set forth in Schedule A opposite the name of such
International Manager bears to the total number of Initial International
Securities, subject in each case to such adjustments as the Global Coordinator
in its discretion shall make to eliminate any sales or purchases of fractional
shares.
(c) Payment. Payment of the purchase price for, and delivery of
certificates for, the Initial Securities shall be made at the offices of Fried,
Frank, Harris, Xxxxxxx & Xxxxxxxx, 0 Xxx Xxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000,
or at such other place as shall be agreed upon by the Global Coordinator and the
Company, at 9:00 A.M. (Eastern time) on the third (fourth, if the
pricing occurs after 4:30 P.M. (Eastern time) on any given day) business day
after the date hereof (unless postponed in accordance with the provisions of
Section 10), or such other time not later than ten business days after such date
as shall be agreed upon by the Global Coordinator and the Company (such time and
date of payment and delivery being herein called "Closing Time").
In addition, in the event that any or all of the International Option
Securities are purchased by the International Managers, payment of the purchase
price for, and delivery of certificates for, such International Option
Securities shall be made at the above-mentioned offices, or at such other place
as shall be agreed upon by the Global Coordinator and the Selling Shareholders
or the Attorneys-in-fact on behalf of the Selling Shareholders, on each Date of
Delivery as specified in the notice from the Global Coordinator to the Selling
Shareholders.
Payment shall be made to the Company and the Selling Shareholders by
wire transfer of immediately available funds to a bank account designated by the
Company and the Custodian pursuant to the Selling Shareholders' Power of
Attorney and Custody Agreement, as the case may be, against delivery to the Lead
Managers for the respective accounts of the International Managers of
certificates for the International Securities to be purchased by them. It is
understood that each International Manager has authorized the Lead Managers, for
its account, to accept delivery of, receipt for, and make payment of the
purchase price for, the Initial International Securities and the International
Option Securities, if any, which it has agreed to purchase. Xxxxxxx Xxxxx,
individually and not as representative of the International Managers, may (but
shall not be obligated to) make
-15-
payment of the purchase price for the Initial International Securities or the
International Option Securities, if any, to be purchased by any International
Manager whose funds have not been received by the Closing Time or the relevant
Date of Delivery, as the case may be, but such payment shall not relieve such
International Manager from its obligations hereunder.
(d) Denominations; Registration. Certificates for the Initial
International Securities and the International Option Securities, if any, shall
be in such denominations and registered in such names as the Lead Managers may
request in writing at least one full business day before the Closing Time or the
relevant Date of Delivery, as the case may be. The certificates for the Initial
International Securities and the International Option Securities, if any, will
be made available for examination and packaging by the Lead Managers in The City
of New York not later than 10:00 A.M. (Eastern time) on the business day prior
to the Closing Time or the relevant Date of Delivery, as the case may be.
(e) Appointment of Qualified Independent Underwriter. The Company hereby
confirms its engagement of Xxxxx Xxxxxx Inc. as, and Xxxxx Xxxxxx Inc. hereby
confirms its agreement with the Company to render services as, a "qualified
independent underwriter" within the meaning of Rule 2720 of the Conduct Rules of
the National Association of Securities Dealers, Inc. with respect to the
offering and sale of the U.S. Securities. Xxxxx Xxxxxx Inc., solely in its
capacity as qualified independent underwriter and not otherwise, is referred to
herein as the "Independent Underwriter".]
SECTION 3. Covenants of the Company. The Company covenants with each
International Manager as follows:
(a) Compliance with Securities Regulations and Commission
Requests. The Company, subject to Section 3(b), will comply with the
requirements of Rule 430A or Rule 434, as applicable, and will notify
the Global Coordinator immediately, and confirm the notice in writing,
(i) when any post-effective amendment to the Registration Statement,
shall become effective, or any supplement to the Prospectuses or any
amended Prospectuses shall have been filed, (ii) of the receipt of any
comments from the Commission, (iii) of any request by the Commission
for any amendment to the Registration Statement or any amendment or
supplement to the Prospectuses or for additional information, and (iv)
of the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or of any order preventing
or suspending the use of any preliminary prospectus, or of the
suspension of the qualification of the Securities for offering or sale
in any jurisdiction, or of the initiation or threatening of any
proceedings for any of such purposes. The Company will promptly effect
the filings necessary pursuant to Rule 424(b) and will take such steps
as it deems necessary to ascertain promptly whether the form of
prospectus transmitted for filing under Rule 424(b) was received for
filing by the Commission and, in the event that it was not, it will
promptly file such prospectus. The Company will make every reasonable
effort to prevent the issuance of any stop order and, if any stop order
is issued, to obtain the lifting thereof at the earliest possible
moment.
(b) Filing of Amendments. The Company will give the Global
Coordinator notice of its intention to file or prepare any amendment to
the Registration Statement
-16-
(including any filing under Rule 462(b)), any Term Sheet or any
amendment, supplement or revision to either the prospectus included in
the Registration Statement at the time it became effective or to the
Prospectuses, will furnish the Global Coordinator with copies of any
such documents a reasonable amount of time prior to such proposed
filing or use, as the case may be, and will not file or use any such
document to which the Global Coordinator or counsel for the
International Managers shall reasonably object.
(c) Delivery of Registration Statements. The Company has
furnished or will deliver to the Lead Managers and counsel for the
International Managers, without charge, signed copies of the
Registration Statement as originally filed and of each amendment
thereto (including exhibits filed therewith) and signed copies of all
consents and certificates of experts, and will also deliver to the Lead
Managers, without charge, a conformed copy of the Registration
Statement as originally filed and of each amendment thereto (without
exhibits) for each of the International Managers. The copies of the
Registration Statement and each amendment thereto furnished to the
International Managers will be identical to the electronically
transmitted copies thereof filed with the Commission pursuant to XXXXX,
except to the extent permitted by Regulation S-T.
(d) Delivery of Prospectuses. The Company has delivered or
will deliver to each International Manager, without charge, as many
copies of each preliminary prospectus as such International Manager
reasonably requested, and the Company hereby consents to the use of
such copies for purposes permitted by the 1933 Act. The Company will
furnish to each International Manager, without charge, during the
period when the International Prospectus is required to be delivered
under the 1933 Act or the Securities Exchange Act of 1934 (the "1934
Act"), such number of copies of the International Prospectus (as
amended or supplemented) as such International Manager may reasonably
request. The International Prospectus and any amendments or supplements
thereto furnished to the International Managers will be identical to
the electronically transmitted copies thereof filed with the Commission
pursuant to XXXXX, except to the extent permitted by Regulation S-T.
(e) Continued Compliance with Securities Laws. The Company
will comply with the 1933 Act and the 1933 Act Regulations so as to
permit the completion of the distribution of the Securities as
contemplated in this Agreement, the U.S. Purchase Agreement and in the
Prospectuses. If at any time when a prospectus is required by the 1933
Act to be delivered in connection with sales of the Securities, any
event shall occur or condition shall exist as a result of which it is
necessary to amend the Registration Statement or amend or supplement
any Prospectus in order that the Prospectuses will not include any
untrue statements of a material fact or omit to state a material fact
necessary in order to make the statements therein not misleading in the
light of the circumstances existing at the time it is delivered to a
purchaser, or if it shall be necessary at any such time to amend the
Registration Statement or amend or supplement any Prospectus in order
to comply with the requirements of the 1933 Act or the 1933 Act
Regulations, the Company will promptly prepare and file with the
Commission, subject to Section 3(b), such amendment or supplement as
may be necessary to correct such statement or omission or to make the
Registration Statement or the Prospectuses comply with such
requirements, and the
-17-
Company will furnish to the International Managers such number of
copies of such amendment or supplement as the International Managers
may reasonably request.
(f) Blue Sky Qualifications. The Company will use its best
efforts, in cooperation with the International Managers, to qualify the
Securities for offering and sale under the applicable securities laws
of such states and other jurisdictions (domestic or foreign) as the
Global Coordinator may designate and to maintain such qualifications in
effect for a period of not less than one year from the later of the
effective date of the Registration Statement and any Rule 462(b)
Registration Statement; provided, however, that neither the Company nor
any of the Selling Shareholders shall be obligated to file any general
consent to service of process or to qualify as a foreign corporation or
as a dealer in securities in any jurisdiction in which it is not so
qualified or to subject itself to taxation in respect of doing business
in any jurisdiction in which it is not otherwise so subject. In each
jurisdiction in which the Securities have been so qualified, the
Company will file such statements and reports as may be required by the
laws of such jurisdiction to continue such qualification in effect for
a period of not less than one year from the effective date of the
Registration Statement and any Rule 462(b) Registration Statement.
(g) Rule 158. The Company will timely file such reports
pursuant to the 1934 Act as are necessary in order to make generally
available to its securityholders as soon as practicable an earnings
statement for the purposes of, and to provide the benefits contemplated
by, the last paragraph of Section 11(a) of the 1933 Act.
(h) Use of Proceeds. The Company will use the net proceeds
received by it from the sale of the Securities in the manner specified
in the Prospectuses under "Use of Proceeds."
(i) Listing. The Company will use its best efforts to effect
the listing of the Common Stock (including the Securities) on the New
York Stock Exchange.
(j) Restriction on Sale of Securities. During a period of 180
days from the date of the Prospectuses, the Company will not, without
the prior written consent of the Global Coordinator, (i) directly or
indirectly, offer, pledge, sell, contract to sell, sell any option or
contract to purchase, purchase any option or contract to sell, grant
any option, right or warrant to purchase or otherwise transfer or
dispose of any share of Common Stock or any securities convertible into
or exercisable or exchangeable for Common Stock or file any
registration statement under the 1933 Act with respect to any of the
foregoing or (ii) enter into any swap or any other agreement or any
transaction that transfers, in whole or in part, directly or
indirectly, the economic consequence of ownership of the Common Stock,
whether any such swap or transaction described in clause (i) or (ii)
above is to be settled by delivery of Common Stock or such other
securities, in cash or otherwise except pursuant to Common Stock issued
in connection with (y) the Company's stock option plans existing at the
Closing Time or (z) acquisitions by the Company; provided that, in the
case of clause (z), it shall be a condition to such stock issuance that
the third party receiving such shares executes a lock-up agreement on
substantially the same terms as described above for a period expiring
180 days from the date of the Prospectus and there shall be no further
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transfer of such shares except in accordance with the provisions of
such lock-up agreement. The foregoing sentence shall not apply to the
Securities to be sold hereunder or under the U.S. Purchase Agreement.
(k) Reporting Requirements. The Company, during the period
when the Prospectuses are required to be delivered under the 1933 Act
or the 1934 Act, will file all documents required to be filed with the
Commission pursuant to the 1934 Act within the time periods required by
the 1934 Act and the rules and regulations of the Commission
thereunder.
(l) Compliance with NASD Rules. The Company hereby agrees that
it will ensure that the Reserved Securities and Direct Shares will be
restricted as required by the National Association of Securities
Dealers, Inc. (the "NASD") or the NASD rules from sale, transfer,
assignment, pledge or hypothecation for a period of three or five
months, as the case may be, following the date of this Agreement. The
Underwriters will notify the Company as to which persons will need to
be so restricted. At the request of the Underwriters, the Company will
direct the transfer agent to place a stop transfer restriction upon
such securities for such period of time. Should the Company release, or
seek to release, from such restrictions any of the Reserved Securities
or Direct Shares, the Company agrees to reimburse the Underwriters for
any reasonable expenses (including, without limitation, legal expenses)
they incur in connection with such release.
SECTION 4. Payment of Expenses. (a) Expenses. The Company will pay all
expenses incident to the performance of its obligations under this Agreement,
including (i) the preparation, printing and filing of the Registration Statement
(including financial statements and exhibits) as originally filed and of each
amendment thereto, (ii) the preparation, printing and delivery to the
Underwriters of this Agreement, any Agreement among Underwriters and such other
documents as may be required in connection with the offering, purchase, sale,
issuance or delivery of the Securities, (iii) the preparation, issuance and
delivery of the certificates for the Securities to the Underwriters, including
any stock or other transfer taxes and any stamp or other duties payable upon the
sale, issuance or delivery of the Securities by the Company to the Underwriters
and the transfer of the Securities between the International Managers and the
U.S. Underwriters, (iv) the fees and disbursements of the Company's counsel,
accountants and other advisors, (v) the qualification of the Securities under
securities laws in accordance with the provisions of Section 3(f) hereof,
including filing fees and the reasonable fees and disbursements of counsel for
the Underwriters in connection therewith and in connection with the preparation
of the Blue Sky Survey and any supplement thereto, (vi) the printing and
delivery to the Underwriters of copies of each preliminary prospectus, any Term
Sheets and of the Prospectuses and any amendments or supplements thereto, (vii)
the preparation, printing and delivery to the Underwriters of copies of the blue
sky survey and any supplement thereto, (viii) the fees and expenses of any
transfer agent or registrar for the Securities, (ix) the filing fees incident
to, and the reasonable fees and disbursements of counsel to the Underwriters in
connection with, the review by the NASD of the terms of the sale of the
Securities, (x) the fees and expenses incurred in connection with the listing of
the Securities on the New York Stock Exchange, (xi) all costs and expenses of
the Underwriters, including the fees and disbursements of counsel for the
Underwriters, in connection with matters related to the Reserved Securities and
Direct Shares which are designated by the Company for sale to eligible
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employees and other persons having relationships with the Company and (xii) the
fees and expenses of the Independent Underwriter.
(b) Expenses of the Selling Shareholders. The Company will pay all
expenses incident to the performance of the Selling Shareholders' obligations
under, and the consummation of the transactions contemplated by, this Agreement
(other than any underwriting discount), including (i) any stamp duties, capital
duties and stock transfer taxes, if any, payable upon the sale of the
International Option Securities by the Selling Shareholders to the Underwriters,
and their transfer between the Underwriters pursuant to an agreement between
such Underwriters and (ii) the fees and disbursements of the Selling
Shareholders' counsel and accountants.
(c) Termination of Agreement. If this Agreement is terminated by the
Lead Managers in accordance with the provisions of Section 5 or Sections 9(a)(i)
or (ii) hereof, the Company shall reimburse the International Managers for all
of their out-of-pocket expenses, including the reasonable fees and disbursements
of counsel for the International Managers.
(d) Allocation of Expenses. The provisions of this Section shall not
affect any agreement that the Company and the Selling Shareholders may make for
the sharing of such costs and expenses.
SECTION 5. Conditions of International Managers' Obligations. The
obligations of the several International Managers hereunder are subject to the
accuracy of the representations and warranties of the Company and the Selling
Shareholders contained in Section 1 hereof or in certificates of any officer of
the Company or any Subsidiary of the Company or on behalf of the Selling
Shareholders delivered pursuant to the provisions hereof, to the performance by
the Company of its covenants and other obligations hereunder, and to the
following further conditions:
(a) Effectiveness of Registration Statement. The Registration
Statement, including any Rule 462(b) Registration Statement, has become
effective under the 1933 Act; and at Closing Time no stop order
suspending the effectiveness of the Registration Statement shall have
been issued under the 1933 Act or proceedings therefor initiated or
threatened by the Commission, and any request on the part of the
Commission for additional information shall have been complied with to
the reasonable satisfaction of counsel to the International Managers. A
prospectus containing the Rule 430A Information shall have been filed
with the Commission in accordance with Rule 424(b) (or a post-effective
amendment providing such information shall have been filed and declared
effective in accordance with the requirements of Rule 430A) or, if the
Company has elected to rely upon Rule 434, a Term Sheet shall have been
filed with the Commission in accordance with Rule 424(b).
(b) Opinions of Counsel for the Company and the Selling
Shareholders. At Closing Time, the Lead Managers shall have received
the favorable opinions, dated as of Closing Time, of (i) Xxxxxx, Xxxx &
Xxxxxxx, s.c. counsel to the Company, relating to certain matters of
Wisconsin law and (ii) Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP,
counsel for the Company, in each case in form and substance reasonably
satisfactory to counsel for the International Managers, together with
signed or reproduced copies of such
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letter for each of the other International Managers to the effect set
forth in Exhibit A-1 and A-2, respectively, hereto.
(c) Opinion of Counsel for International Managers. At Closing
Time, the Lead Managers shall have received the favorable opinion,
dated as of Closing Time, of Fried, Frank, Harris, Xxxxxxx & Xxxxxxxx,
counsel for the International Managers, together with signed or
reproduced copies of such letter for each of the other International
Managers with respect to the matters set forth in clauses (i), (ii),
(v), (vi) (solely as to preemptive or other similar rights arising by
operation of law or under the charter or bylaws of the Company),
(viii), (x), (xi), (xv) (solely as to the information in the Prospectus
under "Description of Capital Stock") of Exhibit A-1 and the
penultimate paragraph of Exhibit A-2 hereto. In giving such opinion
such counsel may rely, as to all matters governed by the laws of
jurisdictions other than the law of the State of New York and the
federal law of the United States and the General Corporation Law of the
State of Delaware, upon the opinions of counsel satisfactory to the
Lead Managers. Such counsel may also state that, insofar as such
opinion involves factual matters, they have relied, to the extent they
deem proper, upon certificates of officers of the Company and its
Subsidiaries and of the Selling Shareholders and certificates of public
officials.
(d) Officers' Certificate. At Closing Time, there shall not
have been, since the date hereof or since the respective dates as of
which information is given in the Prospectuses, any material adverse
change in the 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, and the Lead Managers shall have received a
certificate of the Chairman of the Board, President or a Vice President
of the Company and of the chief financial or chief accounting officer
of the Company, dated as of Closing Time, to the effect that (i) there
has been no such material adverse change, (ii) the representations and
warranties in Section 1(a) hereof are true and correct with the same
force and effect as though expressly made at and as of Closing Time,
(iii) the Company has complied with all agreements and satisfied all
conditions on its part to be performed or satisfied at or prior to
Closing Time, and (iv) no stop order suspending the effectiveness of
the Registration Statement has been issued and no proceedings for that
purpose have been instituted or are pending or threatened by the
Commission.
(e) Selling Shareholders' Certificate. At Closing Time, the
Lead Managers shall have received a certificate of each Selling
Shareholder (which may be executed on behalf of each Selling
Shareholder by the general partner or a duly authorized executive
officer of such Selling Shareholder), dated as of Closing Time, to the
effect that (i) the representations and warranties of each such Selling
Shareholder contained in Section 1(b) hereof are true and correct with
the same force and effect as though expressly made at and as of the
Closing Time and (ii) each such Selling Shareholder has complied with
all agreements and satisfied all conditions on its part to be performed
or satisfied under this Agreement at or prior to the Closing Time;
provided that such Selling Shareholder certificate may provide that
such certificate shall be of no force or effect in the event that no
Option Shares are purchased from the Selling Shareholders hereunder.
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(f) Accountant's Comfort Letters. At the time of the execution
of this Agreement, the Lead Managers shall have received from KPMG Peat
Marwick LLP a letter in the form of Exhibit C-1 hereto and from Coopers
& Xxxxxxx LLP a letter in the form of Exhibit C-2 hereto, dated such
date, in form and substance reasonably satisfactory to the Lead
Managers, together with signed or reproduced copies of such letter for
each of the other International Managers containing statements and
information of the type ordinarily included in accountants' "comfort
letters" to underwriters with respect to the financial statements and
certain financial information contained in the Registration Statement
and the Prospectuses.
(g) Bring-down Comfort Letters. At Closing Time, the Lead
Managers shall have received letters from KPMG Peat Marwick LLP and
Coopers & Xxxxxxx LLP, dated as of Closing Time, to the effect that
they reaffirm the statements made in the letter furnished pursuant to
subsection (e) of this Section, except that the specified date referred
to shall be a date not more than three business days prior to Closing
Time.
(h) Approval of Listing. At Closing Time, the Securities shall
have been approved for listing on the New York Stock Exchange, subject
only to official notice of issuance.
(i) No Objection. The NASD has confirmed that it has not
raised any objection with respect to the fairness and reasonableness of
the underwriting terms and arrangements.
(j) Lock-up Agreements. At the date of this Agreement, the
Lead Managers shall have received (i) an agreement substantially in the
form of Exhibit B hereto signed by the persons listed on Schedule D
hereto.
(k) Purchase of Initial U.S. Securities. Contemporaneously
with the purchase by the International Managers of the Initial
International Securities under this Agreement, the U.S. Underwriters
shall have purchased the Initial U.S. Securities under the U.S.
Purchase Agreement.
(l) Custody Agreement. At the date of this Agreement the Lead
Managers shall have received copies of a Custody Agreement and Power of
Attorney executed by each of the Selling Shareholders.
(m) Conditions to Purchase of International Option Securities.
In the event that the International Managers exercise their option
provided in Section 2(b) hereof to purchase all or any portion of the
International Option Securities, the representations and warranties of
the Company contained herein and the statements in any certificates
furnished by the Company or any Subsidiary of the Company hereunder
shall be true and correct as of each Date of Delivery and, at the
relevant Date of Delivery, the Lead Managers shall have received:
(i) Officers' Certificate. A certificate, dated such Date of
Delivery, of the President or a Vice President of the
Company and of the chief financial or
-22-
chief accounting officer of the Company confirming that
the certificate delivered at the Closing Time pursuant to
Section 5(d) hereof remains true and correct as of such
Date of Delivery.
(ii) Selling Shareholder's Certificate. At the Date of
Delivery, the Lead Managers shall have received a
certificate of each Selling Shareholder (which may be
executed on behalf of each Selling Shareholder by the
general partner or a duly authorized executive officer of
such Selling Shareholder), dated as of Date of Delivery,
to the effect that (x) the representations and warranties
of each such Selling Shareholder contained in Section 1(b)
hereof are true and correct with the same force and effect
as though expressly made at and as of Date of Delivery and
(y) each such Selling Shareholder has complied with all
agreements and satisfied all conditions on their part to
be performed or satisfied under this Agreement at or prior
to Date of Delivery.
(iii) Opinion of Counsel for Company and the Selling
Shareholders. The favorable opinion of (x) Xxxxxx Xxxx &
Xxxxxxx, s.c., Counsel to the Company, relating to certain
matters of Wisconsin law, (y) Skadden, Arps, Slate,
Xxxxxxx & Xxxx LLP, counsel for the Company, and (z)
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP, counsel for the
Selling Shareholders in form and substance reasonably
satisfactory to counsel for the International Managers
together with signed or reproduced copies of such letter
for each of the other International Managers, dated such
Date of Delivery, relating to the International Option
Securities to be purchased on such Date of Delivery and
otherwise to the same effect as the opinion required by
Section 5(b) hereof with respect to (x) and (y) and shall
be to the effect set forth in Exhibit A-3 in the case of
opinion (z).
(iv) Opinion of Counsel for International Managers. The
favorable opinion of Fried, Frank, Harris, Xxxxxxx &
Xxxxxxxx, counsel for the International Managers, dated
such Date of Delivery, relating to the International
Option Securities to be purchased on such Date of Delivery
and otherwise to the same effect as the opinion required
by Section 5(c) hereof.
(v) Bring-down Comfort Letters. Letters from Coopers & Xxxxxxx
LLP and KPMG Peat Marwick LLP in form and substance
reasonably satisfactory to the Lead Managers and dated
such Date of Delivery, substantially in the same form and
substance as the letter furnished to the Lead Managers
pursuant to Section 5(g) hereof, except that the
"specified date" in the letter furnished pursuant to this
paragraph shall be a date not more than five days prior to
such Date of Delivery.
(n) Additional Documents. At Closing Time and at each Date of
Delivery, counsel for the International Managers shall have been
furnished with such documents and opinions as they may reasonably
require for the purpose of enabling them to pass upon the
-23-
issuance and sale of the Securities as herein contemplated, or in order
to evidence the accuracy of any of the representations or warranties,
or the fulfillment of any of the conditions, herein contained; and all
proceedings taken by the Company and the Selling Shareholders in
connection with the issuance and sale of the Securities as herein
contemplated shall be reasonably satisfactory in form and substance to
the Lead Managers and counsel for the International Managers.
(o) Termination of Agreement. If any condition specified in
this Section shall not have been fulfilled when and as required to be
fulfilled, this Agreement, or, in the case of any condition to the
purchase of International Option Securities on a Date of Delivery which
is after the Closing Time, the obligations of the several International
Managers to purchase the relevant Option Securities, may be terminated
by the Lead Managers by notice to the Company at any time at or prior
to Closing Time or such Date of Delivery, as the case may be, and such
termination shall be without liability of any party to any other party
except as provided in Section 4 and except that Sections 1, 6, 7 and 8
shall survive any such termination and remain in full force and effect.
SECTION 6. Indemnification.
(a) Indemnification of International Managers by the Company. (1) The
Company agrees to indemnify and hold harmless each International Manager and
each person, if any, who controls any International Manager within the meaning
of Section 15 of the 1933 Act or Section 20 of the 1934 Act as follows to the
extent set forth below:
(i) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of any untrue statement or
alleged untrue statement of a material fact contained in the
Registration Statement (or any amendment thereto), including the Rule
430A Information and the Rule 434 Information, if applicable, or the
omission or alleged omission therefrom of a material fact required to
be stated therein or necessary to make the statements therein not
misleading or arising out of any untrue statement or alleged untrue
statement of a material fact included in any preliminary prospectus or
the Prospectuses (or any amendment or supplement thereto), or the
omission or alleged omission therefrom of a material fact necessary in
order to make the statements therein, in the light of the circumstances
under which they were made, not misleading;
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of (A) the violation of
any applicable laws or regulations of foreign jurisdictions where
Reserved Securities have been offered and (B) any untrue statement or
alleged untrue statement of a material fact included in the supplement
or prospectus wrapper material distributed in foreign jurisdictions in
connection with the reservation and sale of the Reserved Securities and
Direct Shares to eligible employees and persons having business
relationships with the Company or the omission or alleged omission
therefrom of a material fact necessary to make the statements therein,
when considered in conjunction with the Prospectuses or preliminary
prospectuses, not misleading;
-24-
(iii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate amount
paid in settlement of any litigation, or any investigation or
proceeding by any governmental agency or body, commenced or threatened,
or of any claim whatsoever based upon any such untrue statement or
omission, or any such alleged untrue statement or omission or in
connection with any violation of the nature referred to in Section
6(a)(1)(ii)(A) hereof; provided that (subject to Section 6(e) below)
any such settlement is effected with the written consent of the
indemnifying party; and
(iv) against any and all expense whatsoever, as incurred
(including the fees and disbursements of counsel chosen by Xxxxxxx
Xxxxx), reasonably incurred in investigating, preparing or defending
against any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim
whatsoever based upon any such untrue statement or omission, or any
such alleged untrue statement or omission or in connection with any
violation of the nature referred to in Section 6(a)(1)(ii)(A) hereof,
to the extent that any such expense is not paid under (i), (ii) or
(iii) above;
provided, however, that this indemnity agreement shall not (i) apply to any
loss, liability, claim, damage or expense to the extent arising out of any
untrue statement or omission or alleged untrue statement or omission made in
reliance upon and in conformity with written information furnished to the
Company by any International Manager through the Lead Managers or any U.S.
Underwriter through the U.S. Representatives expressly for use in the
Registration Statement (or any amendment thereto), including the Rule 430A
Information and the Rule 434 Information, if applicable, or any preliminary
prospectus or the International Prospectus or U.S. Prospectus, as the case may
be, (or any amendment or supplement thereto) or (ii) inure to the benefit of any
International Manager from whom the person asserting any loss, liability, claim,
damage or expense, purchased Securities, or any person controlling such
International Manager, if it shall be established that a copy of the Prospectus
(as then amended or supplemented if the Company shall have furnished any
amendments or supplements thereto) was not sent or given by or on behalf of such
U.S. Underwriter to such person, if required by law to have been so delivered,
at or prior to the confirmation of the sale of such Securities to such person in
any case where the Company complied with its obligations under Sections 3(a),
3(b) and 3(d), and if the Prospectus (as so amended or supplemented) would have
cured any defect giving rise to such loss, liability, claim damage, or expense.
(2) In addition to and without limitation of the Company to
indemnify Xxxxx Xxxxxx Inc. as an Underwriter, the Company agrees to
indemnify and hold harmless the Independent Underwriter and each person, if any,
who controls the Independent Underwriter within the meaning of Section 15 of the
1933 Act or Section 20 of the 1934 Act, from and against any and all loss,
liability, claim, damage and expense whatsoever, as incurred, incurred as a
result of the Independent Underwriter's participation as a "qualified
independent underwriter" within the meaning of Rule 2720 of the Conduct Rules of
the National Association of Securities Dealers, Inc. in connection with the
offering of the U.S. Securities.
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(b) Indemnification of the International Managers by the Selling
Shareholders. (1) Each Selling Shareholder, severally and not jointly, agrees to
indemnify and hold harmless each International Manager and each person, if any,
who controls any International Manager within the meaning of Section 15 of the
1933 Act or Section 20 of the 1934 Act as follows to the extent set forth in
clauses (i), (ii), (iii) and (iv) below:
(i) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of any untrue statement or
alleged untrue statement of a material fact contained in the
Registration Statement (or any amendment thereto), including the Rule
430A Information and the Rule 434 Information, if applicable, or the
omission or alleged omission therefrom of a material fact required to
be stated therein or necessary to make the statements therein not
misleading or arising out of any untrue statement or alleged untrue
statement of a material fact included in any preliminary prospectus or
the Prospectuses (or any amendment or supplement thereto), or the
omission or alleged omission therefrom of a material fact necessary in
order to make the statements therein, in the light of the circumstances
under which they were made, not misleading;
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of (A) the violation of
any applicable laws or regulations of foreign jurisdictions where
Reserved Securities have been offered and (B) any untrue statement or
alleged untrue statement of a material fact included in the supplement
or prospectus wrapper material distributed in foreign jurisdictions in
connection with the reservation and sale of the Reserved Securities and
Direct Shares to eligible employees and persons having relationships
with the Company or the omission or alleged omission therefrom of a
material fact necessary to make the statements therein, when considered
in conjunction with the Prospectuses or preliminary prospectuses, not
misleading;
(iii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate amount
paid in settlement of any litigation, or any investigation or
proceeding by any governmental agency or body, commenced or threatened,
or of any claim whatsoever based upon any such untrue statement or
omission, or any such alleged untrue statement or omission or in
connection with any violation of the nature referred to in Section
6(b)(1)(ii)(A) hereof; provided that (subject to Section 6(e) below)
any such settlement is effected with the written consent of the
indemnifying party; and
(iv) against any and all expense whatsoever, as incurred
(including the fees and disbursements of counsel chosen by Xxxxxxx
Xxxxx), reasonably incurred in investigating, preparing or defending
against any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim
whatsoever based upon any such untrue statement or omission, or any
such alleged untrue statement or omission or in connection with any
violation of the nature referred to in Section 6(b)(1)(ii)(A) hereof,
to the extent that any such expense is not paid under (i), (ii) or
(iii) above;
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provided, however, that this indemnity agreement shall not (i) apply to any
loss, liability, claim, damage or expense to the extent arising out of any
untrue statement or omission or alleged untrue statement or omission made in
reliance upon and in conformity with written information furnished to the
Company by any International Manager through the Lead Managers or any U.S.
Underwriter through the U.S. Representative expressly for use in the
Registration Statement (or any amendment thereto), including the Rule 430A
Information and the Rule 434 Information, if applicable, or any preliminary
prospectus or the International Prospectus or U.S. Prospectus, as the case may
be (or any amendment or supplement thereto) or (ii) inure to the benefit of any
International Manager from whom the person asserting any loss, liability, claim,
damage or expense, purchased Securities, or any person controlling such
International Manager, if it shall be established that a copy of the Prospectus
(as then amended or supplemented if the Company shall have furnished any
amendments or supplements thereto) was not sent or given by or on behalf of such
International Manager to such person, if required by law to have been so
delivered, at or prior to the confirmation of the sale of such Securities to
such person in any case where the Company complied with its obligations under
Sections 3(a), 3(b) and 3(d), and if the Prospectus (as so amended or
supplemented) would have cured any defect giving rise to such loss, liability,
claim damage, or expense; provided, however, further, that with respect to each
Selling Shareholder, (x) the indemnification provision in this paragraph (b)
shall only apply to any loss, liability, claim, damage or expense to the extent
arising out of any untrue statement or omission, or alleged untrue statement or
omission made in reliance upon and in conformity with written information
furnished to the Company by such Selling Shareholder expressly for use in the
Registration Statement (or any amendment thereto) including the Rule 430A
Information and the Rule 434 Information if applicable or any such preliminary
International prospectus or the International Prospectus or the U.S.
Prospectus, as the case may be, (or any amendment or supplement thereto and (y)
each such Selling Shareholder's aggregate liability under this Section 6 shall
be limited to an amount equal to the net proceeds (after deducting the
underwriting discount but before deducting expenses) received by such Selling
Shareholder from the sale of Securities pursuant to this Agreement.
(c) Indemnification of Company, Directors and Officers and Selling
Shareholders. Each International Manager severally agrees to indemnify and hold
harmless the Company, its directors, each of its officers who signed the
Registration Statement, and each person, if any, who controls the Company within
the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act and each
Selling Shareholder and each person, if any, who controls any Selling
Shareholder within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act against any and all loss, liability, claim, damage and expense
described in the indemnity contained in Section 6(a) and
-27-
Section 6(b) hereof, as incurred, but only with respect to untrue statements or
omissions, or alleged untrue statements or omissions, made in the Registration
Statement (or any amendment thereto), including the Rule 430A Information and
the Rule 434 Information, if applicable, or any preliminary International
Prospectus or the International Prospectus (or any amendment or supplement
thereto) in reliance upon and in conformity with written information furnished
to the Company by such International Manager through the Lead Managers expressly
for use in the Registration Statement (or any amendment thereto) or such
preliminary prospectus or the International Prospectus (or any amendment or
supplement thereto).
(d) Actions against Parties; Notification. Each indemnified party shall
give notice as promptly as reasonably practicable to each indemnifying party of
any action commenced against it in respect of which indemnity may be sought
hereunder, but failure to so notify an indemnifying party shall not relieve such
indemnifying party from any liability hereunder to the extent it is not
materially prejudiced as a result thereof and in any event shall not relieve it
from any liability which it may have otherwise than on account of this indemnity
agreement. In the case of parties indemnified pursuant to Section 6(a) and
Section 6(b) above or Sections 6(f) or 6(g) below, counsel to the indemnified
parties shall be selected by Xxxxxxx Xxxxx, and, in the case of parties
indemnified pursuant to Section 6(c) above, counsel to the indemnified parties
shall be selected by the Company or the indemnified Selling Shareholder, as
appropriate. An indemnifying party may participate at its own expense in the
defense of any such action; provided, however, that counsel to the indemnifying
party shall not (except with the consent of the indemnified party) also be
counsel to the indemnified party. In no event shall the indemnifying parties be
liable for fees and expenses of more than one counsel (in addition to any
necessary local counsel) separate from their own counsel for all indemnified
parties in connection with any one action or separate but similar or related
actions in the same jurisdiction arising out of the same general allegations or
circumstances; provided, that, if indemnity is sought pursuant to Section
6(a)(2) or Sections 6(f) or 6(g), then, in addition to the fees and expenses of
such counsel for the indemnified parties, the indemnifying party shall be liable
for the reasonable fees and expenses of not more than one counsel (in addition
to any necessary local counsel) separate from its own counsel and that of the
other indemnified parties for the Independent Underwriter in its capacity as a
"qualified independent underwriter" and all persons, if any, who control the
Independent Underwriter within the meaning of Section 15 of the 1933 Act or
Section 20 of 1934 Act in connection with any one action or separate but similar
or related actions in the same jurisdiction arising out of the same general
allegations or circumstances if, in the reasonable judgment of the Independent
Underwriter, there may exist a conflict of interest between the Independent
Underwriter and the other indemnified parties. Any such separate counsel for the
Independent Underwriter and such control persons of the Independent Underwriter
shall be designated in the writing by the Independent Underwriter. No
indemnifying party shall, without the prior written consent of the indemnified
parties, settle or compromise or consent to the entry of any judgment with
respect to any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim whatsoever in
respect of which indemnification or contribution could be sought under this
Section 6 or Section 7 hereof (whether or not the indemnified parties are actual
or potential parties thereto), unless such settlement, compromise or consent (i)
includes an unconditional release of each indemnified party from all liability
arising out of such litigation, investigation, proceeding or claim and (ii) does
not include
-28-
a statement as to or an admission of fault, culpability or a failure to act by
or on behalf of any indemnified party.
(e) Settlement without Consent if Failure to Reimburse. If at any time
an indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel for which the indemnifying
party is responsible pursuant to the terms hereof, such indemnifying party
agrees that it shall be liable for any settlement of the nature contemplated by
Section 6(a)(1)(iii) or Section (6)(b)(1)(iii) or pursuant to Sections 6(f) or
6(g) effected without its written consent if (i) such settlement is entered into
more than 60 days after receipt by such indemnifying party of the aforesaid
request, (ii) such indemnifying party shall have received notice of the terms of
such settlement at least 45 days prior to such settlement being entered into and
(iii) such indemnifying party shall not have reimbursed such indemnified party
in accordance with such request prior to the date of such settlement.
(f) Indemnification for Reserved Securities. In connection with the
offer and sale of the Reserved Securities, the Company agrees, promptly upon a
request in writing, to indemnify and hold harmless the Underwriters from and
against any and all losses, liabilities, claims, damages and expenses incurred
by them as a result of the failure of certain eligible employees and other
persons to pay for and accept delivery of Reserved Securities which, by the end
of the first business day following the date of this Agreement, were subject to
an orally confirmed agreement to purchase.
(g) Indemnification for Direct Shares. The Company agrees to indemnify
and hold harmless the Underwriters from and against any and all losses,
liabilities, claims, damages and expenses incurred by them in connection with
the offer and sale by the Company of the Direct Shares.
(h) Other Agreements with Respect to Indemnification. The provisions of
this Section shall not affect any agreement among the Company and the Selling
Shareholders with respect to indemnification.
SECTION 7. Contribution. If, although applicable in accordance with
its terms, the indemnification provided for in Section 6 hereof is for any
reason unavailable to or insufficient to hold harmless an indemnified party in
respect of any losses, liabilities, claims, damages or expenses referred to
therein, then each indemnifying party shall contribute to the aggregate amount
of such losses, liabilities, claims, damages and expenses incurred by such
indemnified party, as incurred, (i) in such proportion as is appropriate to
reflect the relative benefits received by the Company and the Selling
Shareholders on the one hand and the International Managers on the other hand
from the offering of the Securities pursuant to this Agreement or (ii) if the
allocation provided by clause (i) is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits referred
to in clause (i) above but also the relative fault of the Company and the
Selling Shareholders on the one hand and of the International Managers on the
other hand in connection with the statements or omissions, or in connection with
any violation of the nature referred to in Section 6(a)(1)(ii)(A) or Section
6(b)(1)(ii)(A) hereof, which resulted in such losses, liabilities, claims,
damages or expenses, as well as any other relevant equitable considerations.
-29-
The relative benefits received by the Company and the Selling
Shareholders on the one hand and the International Managers on the other hand in
connection with the offering of the International Securities pursuant to this
Agreement shall be deemed to be in the same respective proportions as the total
net proceeds from the offering of the International Securities pursuant to this
Agreement (before deducting expenses) received by the Company and the Selling
Shareholders and the total underwriting discount received by the International
Managers, in each case as set forth on the cover of the International
Prospectus, or, if Rule 434 is used, the corresponding location on the Term
Sheet, bear to the aggregate initial public offering price of the International
Securities as set forth on such cover.
The relative fault of the Company and the Selling Shareholders on the
one hand and the International Managers on the other hand shall be determined by
reference to, among other things, whether any such untrue or alleged untrue
statement of a material fact or omission or alleged omission to state a material
fact relates to information supplied by the Company or the Selling Shareholders
or by the International Managers and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission or any violation of the nature referred to in Section 6(a)(1)(ii)(A) or
Section 6(b)(1)(ii)(A) hereof.
The Company, the Selling Shareholders and the International Managers
agree that it would not be just and equitable if contribution pursuant to this
Section 7 were determined by pro rata allocation (even if the International
Managers were treated as one entity for such purpose) or by any other method of
allocation which does not take account of the equitable considerations referred
to above in this Section 7. The aggregate amount of losses, liabilities, claims,
damages and expenses incurred by an indemnified party and referred to above in
this Section 7 shall be deemed to include any legal or other expenses reasonably
incurred by such indemnified party in investigating, preparing or defending
against any litigation, or any investigation or proceeding by any governmental
agency or body, commenced or threatened, or any claim whatsoever based upon any
such untrue or alleged untrue statement or omission or alleged omission.
Notwithstanding the provisions of this Section 7, no International
Manager shall be required to contribute any amount in excess of the amount by
which the total price at which the International Securities underwritten by it
and distributed to the public were offered to the public exceeds the amount of
any damages which such International Manager has otherwise been required to pay
by reason of any such untrue or alleged untrue statement or omission or alleged
omission.
No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the 0000 Xxx) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 7, (a) each person, if any, who controls a
International Manager within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act shall have the same rights to contribution as such
International Manager, (b) each director of the Company, each officer of the
Company who signed the Registration Statement, and each person, if any, who
controls the Company within the meaning of Section 15 of the 1933 Act or Section
20 of the 1934 Act shall have the same rights to contribution as the Company and
(c) each person, if any, who controls any
-30-
Selling Shareholder within the meaning of Section 15 of the 1933 Act or Section
20 of the 1934 Act shall have the same rights to contribution as such Selling
Shareholder. The International Managers respective obligations to contribute
pursuant to this Section 7 are several in proportion to the number of Initial
International Securities set forth opposite their respective names in Schedule A
hereto and not joint.
Notwithstanding the provisions of this Section 7, no Selling
Shareholder shall be required to contribute any amount in excess of the amount
equal to the net proceeds (after deducting the underwriting discount but before
deducting expenses) received by such Selling Shareholder from the sale of
International Option Securities pursuant to this Agreement.
The provisions of this Section shall not affect any agreement among the
Company and the Selling Shareholders with respect to contribution.
SECTION 8. Representations, Warranties and Agreements to Survive
Delivery. All representations, warranties and agreements contained in this
Agreement or in certificates of officers of the Company or any of its
Subsidiaries or the Selling Shareholders submitted pursuant hereto, shall remain
operative and in full force and effect, regardless of any investigation made by
or on behalf of any International Manager or controlling person, or by or on
behalf of the Company or any Selling Shareholder, and shall survive delivery of
the International Option Securities to the International Managers.
SECTION 9. Termination of Agreement.
(a) Termination; General. The Lead Managers may terminate this
Agreement, by notice to the Company and the Attorneys-in-Fact on behalf of the
Selling Shareholders, at any time at or prior to Closing Time (i) if there has
been, since the time of execution of this Agreement or since the respective
dates as of which information is given in the International Prospectus, any
material adverse change in the condition, financial or otherwise, or in the
earnings, business affairs or business prospects of the Company and its
Subsidiaries considered as one enterprise, whether or not arising in the
ordinary course of business, or (ii) if there shall have occurred a downgrading
in the rating assigned to any of the Company's debt securities by any nationally
recognized securities rating agency, or if such securities rating agency shall
have publicly announced that it has under surveillance or review, with possible
negative implications, its rating of any of the Company's debt securities, or
(iii) if there has occurred any material adverse change in the financial markets
in the United States or the international financial markets, any outbreak of
hostilities or escalation thereof or other calamity or crisis or any change or
development involving a prospective change in national or international
political, financial or economic conditions, in each case the effect of which is
such as to make it, in the judgment of the Lead Managers, impracticable to
market the Securities or to enforce contracts for the sale of the Securities, or
(iv) if trading in any securities of the Company has been suspended or
materially limited by the Commission or the New York Stock Exchange, or if
trading generally on the American Stock Exchange or the New York Stock Exchange
or in the Nasdaq National Market has been suspended or materially limited, or
minimum or maximum prices for trading have been fixed, or maximum
ranges for prices have been required, by any of said exchanges or by such system
or by order of the Commission, the National Association of Securities Dealers,
Inc. or any other governmental authority, or (v) if a banking moratorium has
been declared
-31-
by either Federal or New York authorities.
(b) Liabilities. If this Agreement is terminated pursuant to this
Section, such termination shall be without liability of any party to any other
party except as provided in Section 4 hereof, and provided further that Sections
1, 6, 7 and 8 shall survive such termination and remain in full force and
effect.
SECTION 10. Default by One or More of the International Managers. If
one or more of the International Managers shall fail at Closing Time or a Date
of Delivery to purchase the Securities which it or they are obligated to
purchase under this Agreement (the "Defaulted Securities"), the Lead Managers
shall have the right, within 24 hours thereafter, to make arrangements for one
or more of the non-defaulting International Managers, or any other underwriters,
to purchase all, but not less than all, of the Defaulted Securities in such
amounts as may be agreed upon and upon the terms herein set forth; if, however,
the Lead Managers shall not have completed such arrangements within such 24-hour
period, then:
(a) if the number of Defaulted Securities does not exceed 10%
of the number of International Securities to be purchased on such date,
each of the non-defaulting International Managers shall be obligated,
severally and not jointly, to purchase the full amount thereof in the
proportions that their respective underwriting obligations hereunder
bear to the underwriting obligations of all non-defaulting
International Managers, or
(b) if the number of Defaulted Securities exceeds 10% of the
number of International Securities to be purchased on such date, this
Agreement or, with respect to any Date of Delivery which occurs after
the Closing Time, the obligation of the International Managers to
purchase the International Option Securities to be purchased and sold
on such Date of Delivery shall terminate without liability on the part
of any non-defaulting International Manager.
No action taken pursuant to this Section shall relieve any defaulting
International Manager from liability in respect of its default.
In the event of any such default which does not result in a termination
of this Agreement or, in the case of a Date of Delivery which is after the
Closing Time, which does not result in a termination of the obligation of the
International Managers to purchase and the Selling Shareholders to sell the
relevant International Option Securities, as the case may be, either (i) the
Lead Managers or (ii) the Selling Shareholders shall have the right to postpone
the Closing Time or the relevant Date of Delivery, as the case may be, for a
period not exceeding seven days in order to effect any required changes in the
Registration Statement or Prospectus or in any other documents or arrangements.
As used herein, the term "International Manager" includes any person substituted
for a International Manager under this Section 10.
SECTION 11. Notices. All notices and other communications hereunder
shall be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the
International Managers shall be directed to the Lead Managers at Xxxxx Xxxxx,
Xxxxx Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000-0000, attention
-32-
of X. Xxxxx Smart, with a copy to Fried, Frank, Harris, Xxxxxxx & Xxxxxxxx, 0
Xxx Xxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, attention of Xxxxxxx Xxxx Jacob, Esq.;
and notices to the Company shall be directed to it at Rayovac Corporation, 000
Xxxxxxx Xxxxx, Xxxxxxx, Xxxxxxxxx 00000, attention of Xxxxx X. Xxxxxxxxx, Esq.,
with a copy to Xxxxx X. Xxxxxxx, Esq., Skadden, Arps, Slate, Xxxxxxx & Xxxx,
LLP, Xxx Xxxxxx Xxxxxx, Xxxxxx, XX; notices to the Selling Shareholders shall be
delivered to them at The Xxxxxx X. Xxx Company, 00 Xxxxx Xxxxxx, Xxxxx 0000,
Xxxxxx, XX 00000 with a copy to Xxxxx X. Xxxxxxx, Esq., Skadden, Arps, Slate,
Xxxxxxx & Xxxx LLP, Xxx Xxxxxx Xxxxxx, Xxxxxx, XX 00000.
SECTION 12. Parties. This Agreement shall each inure to the benefit of
and be binding upon the International Managers, the Company, the Selling
Shareholders and, their respective successors. Nothing expressed or mentioned in
this Agreement is intended or shall be construed to give any person, firm or
corporation, other than the International Managers, the Company, the Selling
Shareholders and, their respective successors and the controlling persons and
officers and directors referred to in Sections 6 and 7 and their heirs and legal
representatives, any legal or equitable right, remedy or claim under or in
respect of this Agreement or any provision herein contained. This Agreement and
all conditions and provisions hereof are intended to be for the sole and
exclusive benefit of the International Managers, the Company, the Selling
Shareholders, and their respective successors, and said controlling persons and
officers and directors and their heirs and legal representatives, and for the
benefit of no other person, firm or corporation. No purchaser of Securities from
any International Manager shall be deemed to be a successor by reason merely of
such purchase.
SECTION 13. GOVERNING LAW AND TIME. THIS AGREEMENT SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. SPECIFIED
TIMES OF DAY REFER TO NEW YORK CITY TIME. AS USED HEREIN, THE TERM "BUSINESS
DAY" MEANS ANY DAY ON WHICH THE NEW YORK STOCK EXCHANGE AND COMMERCIAL BANKS IN
NEW YORK CITY ARE REGULARLY OPEN FOR BUSINESS.
SECTION 14. Effect of Headings. The Article and Section headings
herein and the Table of Contents are for convenience only and shall not
affect the construction hereof.
SECTION 15. Counterparts. This Agreement may be executed in one or
more counterparts and, when a counterpart has been executed by each party
hereto, all such counterparts taken together shall constitute one and the same
agreement. The Article and Section headings herein and the Table of Contents are
for convenience only and shall not affect the construction hereof
-33-
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Company a counterpart hereof, whereupon
this instrument, along with all counterparts, will become a binding agreement
among the International Managers, the Company and the Selling Shareholders in
accordance with its terms.
Very truly yours,
RAYOVAC CORPORATION
By:____________________________
Name: Xxxxx X. Xxxxx
Title: Chairman of the Board,
Chief Executive Officer and
President
SELLING SHAREHOLDERS
XXXXXX X. XXX EQUITY FUND III, L.P.
By: THL Equity Advisors III Limited
Partnership, as General Partner
By: THL Equity Trust III,
as General Partner
By:____________________________
Name:
Title:
XXXXXX X. XXX FOREIGN FUND III, L.P.
By: THL Equity Advisors III Limited
Partnership, as General Partner
By: THL Equity Trust III,
as General Partner
By: ____________________________
Name:
Title:
-1-
THL-CCI Limited Partnership
By: ____________________________
Name: Xxxxxx X. Xxxxx, Xx.,
as agent and attorney-in-fact under
appointment of Power of Attorney dated
________, 1997 for THL-CCI Limited
Partnership
CONFIRMED AND ACCEPTED,
as of the date first above written:
XXXXXXX XXXXX INTERNATIONAL
BEAR, XXXXXXX INTERNATIONAL LIMITED
XXXXXXXXX, XXXXXX & XXXXXXXX SECURITIES CORPORATION
XXXXX XXXXXX INC.
By: XXXXXXX XXXXX INTERNATIONAL
By:_________________________________
Authorized Signatory
For themselves and as Lead Managers of the
other International Managers named in Schedule A hereto.
-2-
SCHEDULE A
Number of
Initial
Name of International Manager International
----------------------------- Securities
Xxxxxxx Xxxxx International.......................................
Bear, Xxxxxxx International Limited...............................
Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities Corporation...............
Xxxxx Xxxxxx Inc..................................................
Total.............................................................. 1,340,000
=========
- 1-
SCHEDULE B
Selling Shareholder Maximum Number of
------------------- International Option Securities
to be Sold
----------
XXXXXX X. XXX EQUITY FUND III, L.P.
--------------------------
XXXXXX X. XXX FOREIGN FUND III, L.P.
--------------------------
THL-CCI Limited Partnership
--------------------------
Total............................. 201,000
=======
- 2-
SCHEDULE C
Rayovac Corporation.
1,340,000 Shares of Common Stock
(Par Value $0.01 Per Share)
1. The initial public offering price per share for the
Securities, determined as provided in said Section 2, shall be $ .
2. The purchase price per share for the International
Securities to be paid by the several International Managers shall be $ ,
being an amount equal to the initial public offering price set forth above less
$ per share; provided that the purchase price per share for any
International Option Securities purchased upon the exercise of the
over-allotment option described in Section 2(b) shall be reduced by an amount
per share equal to any dividends or distributions declared by the Company and
payable on the Initial International Securities but not payable on the
International Option Securities.
-1-
SCHEDULE D
List of Persons and Entities Subject to Lock-up
Xxxxxx X. Xxx Equity Fund III, L.P.
THL-CCI Limited Partnership
Xxxxxx X. Xxx Foreign Fund III, L.P.
Xxxxx X. Xxxxxx
Xxxxxx Xxxxxxxxx
Xxxxx X. Xxxxx
Xxxxx X. Xxxxxxxxx
Xxxxxxx X. Xxxxxxx
Xxxxxxx X. Xxxxxxx
Xxxx X. Xxxxxx
Xxxx X. Xxxxxxxx
Xxxxxxx X. Xxxxxx
Xxxx X. Xxxxxx
Xxxxxxx X. Xxxxxxx
Xxxxxxx X. Xxxxxx
Xxxxx X. Xxxxxx
Xxxxxx X. Xxxxxxxx
Xxxxxx X. Xxxxx
EXHIBIT A-1
FORM OF OPINION OF XXXXXX XXXX & XXXXXXX, s.c., WISCONSIN COUNSEL
TO BE DELIVERED PURSUANT TO
SECTION 5(b)*
(i) The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Wisconsin.
(ii) The issuance of the Securities is not subject to the preemptive or
other similar rights of any securityholder of the Company.
(iii) The Company has corporate power and authority to own, lease and
operate its properties and to conduct its business as described in the
Prospectuses and to enter into and perform its obligations under the U.S.
Purchase Agreement and the International Purchase Agreement.
(iv) The form of certificate used to evidence the Common Stock complies
in all material respects with all applicable statutory requirements, with any
applicable requirements of the charter and by-laws of the Company and the
requirements of the New York Stock Exchange.
(v) The Company is duly qualified as a foreign corporation to transact
business and is in good standing in each jurisdiction in which such
qualification is required, whether by reason of the ownership or leasing of
property or the conduct of business, except where the failure so to qualify or
to be in good standing would not result in a Material Adverse Effect.
(vi) The statements in the Prospectuses under the caption "Description
of Capital Stock", to the extent that such statements constitute matters of law,
summaries of legal matters or legal conclusions are correct in all material
respects.
(vii) The authorized, issued and outstanding capital stock of the
Company is as set forth in the Prospectuses in the column entitled "Actual"
under the caption "Capitalization" (except for subsequent issuances, if any,
pursuant to the U.S. Purchase Agreement and the International Purchase
Agreement); the shares of issued and outstanding capital stock have been and
will have been at the Closing Time duly authorized and validly issued and are
fully paid and non-assessable; and none of the outstanding shares of capital
stock of the Company was or will have been at the Closing Time issued in
violation of the preemptive or other similar rights of any securityholder of the
Company.
(viii) The Securities to be purchased by the U.S. Underwriters and the
International Managers from the Company have been duly authorized for issuance
and sale to the Underwriters pursuant to the U.S. Purchase Agreement and the
International Purchase Agreement, respectively,
------------------
* Full Form of opinion, including qualifications to be attached
prior to execution.
-1-
and, when issued and delivered by the Company pursuant to the U.S. Purchase
Agreement and the International Purchase Agreement, respectively, against
payment of the consideration set forth in the U.S. Purchase Agreement and the
International Purchase Agreement, will be validly issued and fully paid and
non-assessable and no holder of the Securities is or will be subject to personal
liability by reason of being such a holder.
(ix) Each subsidiary incorporated or organized under the laws of the
state of Wisconsin (a "Wisconsin Subsidiary") has been duly incorporated and is
validly existing as a corporation in good standing under the laws of the state
of Wisconsin, has corporate power and authority to own, lease and operate its
properties and to conduct its business as described in the Prospectuses and is
duly qualified as a foreign corporation to transact business and is in good
standing in each jurisdiction in which such qualification is required, whether
by reason of the ownership or leasing of property or the conduct of business,
except where the failure so to qualify or to be in good standing would not
result in a Material Adverse Effect.
(x) The information in the Registration Statement under Item 14, to the
extent that it constitutes matters of law, summaries of legal matters, the
Company's charter and bylaws or legal proceedings, or legal conclusions, has
been reviewed by us and is correct in all material respects.
(xi) The U.S. Purchase Agreement and the International Purchase
Agreement have been duly authorized, executed and delivered by the Company.
(xii) To the best of our knowledge, neither the Company nor any
Wisconsin Subsidiary is in violation of its charter or by-laws and no default by
the Company or any Wisconsin Subsidiary exists in the due performance or
observance of any material obligation, agreement, covenant or condition
contained in any contract, indenture, mortgage, loan agreement, note, lease or
other agreement or instrument that is described or referred to in the
Registration Statement or the Prospectuses or filed or incorporated by reference
as an exhibit to the Registration Statement.
(xiii) The execution, delivery and performance of the U.S. Purchase
Agreement and the International Purchase Agreement and the consummation of the
transactions contemplated in the U.S. Purchase Agreement, the International
Purchase Agreement and in the Registration Statement (including the issuance and
sale of the Securities and the use of the proceeds from the sale of the
Securities as described in the Prospectuses under the caption "Use Of Proceeds")
and compliance by the Company with its obligations under the U.S. Purchase
Agreement and the International Purchase Agreement do not and will not, whether
with or without the giving of notice or lapse of time or both, conflict with or
constitute a breach of, or default or Repayment Event (as defined in Section
1(a)(x) of the Purchase Agreements) under, or result in the creation or
imposition of any lien, charge or encumbrance upon any property or assets of the
Company or any Wisconsin Subsidiary pursuant to any contract, indenture,
mortgage, deed of trust, loan or credit agreement, note, lease or any other
agreement or instrument to which the Company or any Wisconsin Subsidiary is a
party or by which it or any of them may be bound, or to which any of the
property or assets of the Company or any Wisconsin Subsidiary is subject (except
for such conflicts, breaches or defaults or liens, charges or encumbrances that
would not have a Material Adverse Effect), nor will such action result in any
violation of the provisions of the charter or by-laws of the Company or any
Wisconsin Subsidiary, or any applicable law, statute, rule, regulation,
judgment, order, writ or decree, of any government, government instrumentality
or court, domestic or foreign,
-2-
having jurisdiction over the Company or any Wisconsin Subsidiary or any of their
respective properties, assets or operations.
In rendering such opinion, such counsel may rely as to matters of fact
(but not as to legal conclusions), to the extent they deem proper, on
certificates of responsible officers of the Company and public officials. Such
opinion shall not state that it is to be governed or qualified by, or that it is
otherwise subject to, any treatise, written policy or other document relating to
legal opinions, including, without limitation, the Legal Opinion Accord of the
ABA Section of Business Law (1991).
-3-
EXHIBIT A-2
FORM OF OPINION OF COMPANY'S COUNSEL
TO BE DELIVERED PURSUANT TO
SECTION 5(b)*
November [ ], 1997
XXXXXXX XXXXX & CO.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
Bear, Xxxxxxx & Co. Inc.
Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities Corporation
Xxxxx Xxxxxx Inc.
as U.S. Representatives of the several
U.S. Underwriters to be named in the
U.S. Purchase Agreement
Xxxxxxx Xxxxx International
Bear, Xxxxxxx International Limited
Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities Corporation
Xxxxx Xxxxxx Inc.
as representatives of the several
international managers to be named
in the International Purchase Agreement
x/x Xxxxxxx Xxxxx & Xx.
Xxxxx Xxxxx
World Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Re: Public Offering of 6,700,000 Shares of
Common Stock of Rayovac Corporation
-----------------------------------
Ladies and Gentlemen:
We have acted as special counsel to Rayovac Corporation, a Wisconsin
corporation (the "Company"), in connection with (i) the registration and sale by
--------
* Full Form of opinion, including qualifications to be attached prior to
execution.
XXXXXXX XXXXX & CO.
Xxxxxxx Xxxxx International
November [ ], 1997
Page 2
the Company of 5,360,000 shares of the Company's Common Stock, par value $0.01
per share (the "U.S. Shares"), pursuant to the terms of the U.S. Purchase
Agreement (the "U.S. Purchase Agreement"), dated November [ ], 1997, among the
Company, the U.S. Underwriters named in Schedule A thereto (the "U.S.
Underwriters") and the shareholders of the Company named in Schedule B thereto
(the "Selling Shareholders") and (ii) the registration and sale by the Company
of 1,340,000 shares of Common Stock (the "International Shares," and together
with the U.S. Shares, the "Shares"), pursuant to the terms of the International
Purchase Agreement (the "International Purchase Agreement"), dated November [ ],
1997, between the Company and the international managers named in Schedule A
thereto (the "International Managers") and the Selling Shareholders.
This opinion is being furnished pursuant to Section 5(b) of each of the
U.S. Purchase Agreement and the International Purchase Agreement. Capitalized
terms used but not otherwise defined herein shall have the respective meanings
set forth in the U.S. Purchase Agreement.
In connection with this opinion, we have examined originals or copies,
certified or otherwise identified to our satisfaction, of (i) the Registration
Statement on Form S-1 (File No. 333-35181) relating to the Shares filed with the
Securities and Exchange Commission (the "Commission") on September 8, 1997 under
the Securities Act of 1933, as amended (the "Act"), Amendment No. 1 thereto, as
filed with the Commission on October 31, 1997, [and Amendment No. 2 thereto, as
filed with the Commission on November , 1997,] including the information deemed
to be a part of the Registration Statement at the time of effectiveness pursuant
to Rule 430A of the General Rules and Regulations under the Act (the "Rules and
Regulations") (such registration statement, as so amended, being hereinafter
referred to as the "Registration Statement"); (ii) the final U.S. prospectus
dated November [ ], 1997, relating to the U.S. Shares filed with the Commission
on November [ ], 1997 pursuant to Rule 424(b) of the Rules and Regulations (the
"U.S. Prospectus"); (iii) the final International Prospectus dated November [],
1997, relating to the International Shares filed with the Commission on
November [ ], 1997, pursuant to Rule 424(b) of the Rules and Regulations (the
"International Prospectus" and together with the U.S. Prospectus, the
"Prospectuses"); (iv) executed copies of the U.S. Purchase Agreement and the
International Purchase Agreement; (v) a specimen certificate representing the
Common Stock (the "Specimen Certificate"); and (vi) the certificate of Xxxxx X.
XXXXXXX XXXXX & CO.
Xxxxxxx Xxxxx International
November [ ], 1997
Page 3
Xxxxxxxxx, General Counsel to the Company, attached hereto as Exhibit A (the
"Officer's Certificate"). We have also examined originals or copies, certified
or otherwise identified to our satisfaction, of all such records of the Company
and all such agreements, certificates of public officials, certificates of
officers or other representatives of the Company and others, and such other
documents, certificates and records as we have deemed necessary or appropriate
as a basis for the opinions set forth herein.
In our examination, we have assumed the legal capacity of all natural
persons, the genuineness of all signatures, the authenticity of all documents
submitted to us as originals, the conformity to original documents of all
documents submitted to us as certified, conformed or photostatic copies and the
authenticity of the originals of such copies. In making our examination of
executed documents, we have assumed that the parties thereto (including the
Company) had the power, corporate or other, to enter into and perform all
obligations thereunder and have also assumed the due authorization by all
requisite action, corporate or other, and execution and delivery by such parties
of such documents and the validity and binding effect thereof. As to any facts
material to the opinions expressed herein that were not independently
established or verified, we have relied upon oral or written statements and
representations of officers and other representatives of the Company.
For purposes of the opinions set forth below, with respect to any document
which by its terms or otherwise is governed by the laws of any jurisdiction
other than the United States of America or the State of New York, such opinions
are based solely upon our understanding of the plain language of such document,
and we express no opinion as to the interpretation of any such document or of
any term or provision thereof under applicable governing law or as to the effect
on the opinions expressed herein of any interpretation thereof inconsistent with
such understanding. For purposes of our opinion set forth in paragraph 4, we
have assumed that the certificates representing the shares referred to in such
paragraph conform to the Specimen Certificate. Our opinion set forth in
paragraph 5, is based solely upon the Officer's Certificate and our discussions
with Xxxxx X. Xxxxxxxxx, General Counsel of the Company; we have not performed
any docket search in any jurisdiction, and have not done any other investigation
of any kind.
XXXXXXX XXXXX & CO.
Xxxxxxx Xxxxx International
November [ ], 1997
Page 4
The opinions expressed herein are limited to the laws of the State of New
York, the General Corporation Law of the State of Delaware and the federal laws
of the United States of America to the extent specifically referred to herein.
As used herein, (i) the term "Applicable Laws" means the General
Corporation Law of the State of Delaware and those laws, rules and regulations
of the State of New York and of the United States of America that, in our
experience, are normally applicable to transactions of the type contemplated by
the U.S. Purchase Agreement, but without our having made any special
investigation concerning the applicability of any other law, rule or regulation;
provided, that such term does not include any federal or state securities or
other antifraud laws or the rules and regulations of the National Association
of Securities Dealers, Inc.; (ii) the term "Applicable Contracts" means those
contracts and agreements listed on Annex A to the Officer's Certificate; and
(iii) the term "Governmental Approval" means any consent, approval, license,
authorization or validation of, or filing, recording or registration with, any
United States federal or New York executive, legislative, judicial,
administrative or regulatory body (a "Governmental Entity"), pursuant to
Applicable Laws.
Based upon and subject to the foregoing and to the other qualifications and
limitations set forth herein, we are of the opinion that:
1. All of the issued and outstanding capital stock of ROV Holding, Inc. has
been duly authorized and validly issued and is fully paid and nonassessable.
None of the outstanding shares of capital stock of ROV Holding, Inc. was issued
in violation of the preemptive rights of any security holder of ROV Holding,
Inc. arising under the Certificate of Incorporation or By-laws of ROV Holding,
Inc. or any other similar rights arising under any Applicable Contract.
2. To our knowledge, based solely on our examination of the stock record
book of ROV Holding, Inc., the issued and outstanding capital stock of ROV
Holding, Inc. is owned of record by the Company, free and clear of any security
interest, mortgage, pledge, lien, encumbrance, claim or equity arising under any
Applicable Contract, except for the pledge of the capital stock of ROV Holding,
Inc. by the Company pursuant to a Company Pledge Agreement dated as of September
12, 1996 between the Company and Bank of America National Trust and Savings
Association in its capacity as administrative agent for the lenders referred to
therein.
XXXXXXX XXXXX & CO.
Xxxxxxx Xxxxx International
November [ ], 1997
Page 5
3. The Registration Statement, as of its effective date, and the
Prospectuses, as of their date, appeared on their face to be appropriately
responsive in all material respects to the requirements of the Securities Act
and the Rules and Regulations, except that, in each case, we express no opinion
as to the financial statements, schedules and other financial data included
therein or excluded therefrom or the exhibits to the Registration Statement, and
we do not assume any responsibility for the accuracy, completeness or fairness
of the statements contained in the Registration Statement except to the extent
indicated in paragraph 6 below.
4. The Specimen Certificate complies in all material respects with any
requirements of the New York Stock Exchange applicable to companies whose
securities are listed thereon.
5. To our knowledge, except as set forth in the Registration Statement or
the Prospectuses, there are no legal, regulatory or governmental proceedings
pending in any New York State or federal court to which the Company or any
subsidiary of the Company listed on Exhibit 21 to the Registration Statement
(each, a "Subsidiary") is a party, or to which the property of the Company or
any Subsidiary is subject, which might reasonably be expected to result in a
Material Adverse Effect, or which might reasonably be expected to materially and
adversely affect the transactions contemplated by the U.S. Purchase Agreement or
the International Purchase Agreement or the performance by the Company of its
obligations thereunder.
6. The statements in the Prospectuses under the captions "Description of
Capital Stock," "Description of Certain Indebtedness," "Shares Eligible for
Future Sale," "Underwriting" and "Certain Federal Income Tax Considerations," to
the extent that such statements constitute matters of law, summaries of legal
matters or legal conclusions, are correct in all material respects.
7. No Governmental Approval is required under Applicable Laws in connection
with the consummation by the Company of the transactions contemplated by the
U.S. Purchase Agreement or the International Purchase Agreement except that we
do not express any opinion as to any consent or authorization which may have
become applicable to the Company as a result of the involvement of the U.S.
XXXXXXX XXXXX & CO.
Xxxxxxx Xxxxx International
November [ ], 1997
Page 6
Underwriters or of the International Managers in the transactions contemplated
by the U.S. Purchase Agreement or the International Purchase Agreement, because
of their legal or regulatory status or because of any other facts specifically
pertaining to them.
8. Neither the execution and delivery of the U.S. Purchase Agreement or
the International Purchase Agreement nor the consummation of the transactions
contemplated therein will contravene any Applicable Laws.
9. To our knowledge, based solely upon a review of the Applicable
Contracts, there are no Applicable Contracts of a character required to be filed
as exhibits to the Registration Statement which are not filed as required.
10. The execution, delivery and performance of the U.S. Purchase Agreement
and the International Purchase Agreement and the consummation of the
transactions contemplated thereby and the use of the proceeds from the sale of
the Shares as described in the Prospectuses under the caption "Use of Proceeds"
do not and will not, either by itself or the giving of notice or the lapse of
time or both, conflict with or constitute a breach of or a default or Repayment
Event (as defined in Section 1(a)(x) of the Purchase Agreements) under any
Applicable Contract or result in the creation or imposition of any lien, charge
or encumbrance upon any property or assets of the Company or any Subsidiary
pursuant to any Applicable Contract to which the Company or any Subsidiary is a
party or by which it or any of them may be bound, or to which any of the
property or assets of the Company or any Subsidiary is subject or any Applicable
Law or Governmental Approval of any Governmental Entity having jurisdiction over
the Company or any Subsidiary or any of their respective properties, assets or
operations, except in any such case for any such conflicts, breaches, or
defaults which would not have a Material Adverse Effect.
11. Except as disclosed in the Registration Statement, to our knowledge,
there are no persons with registration rights or other similar rights under any
Applicable Contract to have any shares of Common Stock registered pursuant to
the Registration Statement or otherwise registered by the Company pursuant to
the 1933 Act.
XXXXXXX XXXXX & CO.
Xxxxxxx Xxxxx International
November [ ], 1997
Page 7
12. The Company is not subject to registration as an investment company
under the Investment Company Act of 1940, as amended.
We have been orally advised by the Commission that the Registration
Statement was declared effective under the Act at [ ], Washington, D.C. time, on
November [ ], 1997; the required filing of the Prospectuses pursuant to Rule
424(b) has been made in the manner and within the time period required by Rule
424(b); and, to our knowledge, no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that purpose have
been instituted or are pending or threatened by the Commission.
In addition, we have participated in conferences with officers and other
representatives of the Company, representatives of the independent public
accountants for the Company, and you and your counsel, at which the contents of
the Registration Statement, the Prospectuses and related matters were discussed
and, although we are not passing upon, and do not assume any responsibility for,
the accuracy, completeness or fairness of the statements contained in the
Registration Statement or the Prospectuses and have made no independent check or
verification thereof, on the basis of the foregoing, no facts have come to our
attention that have led us to believe that the Registration Statement, at the
time it became effective, 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 the Prospectuses, as of
their dates and as of the date hereof, contained or contains an untrue statement
of a material fact or omitted or omit to state a material fact necessary in
order to make the statements therein, in light of the circumstances under which
they were made, not misleading, except that we express no opinion or belief with
respect to the financial statements, schedules and other financial data included
therein or excluded therefrom or the exhibits to the Registration Statement.
This opinion is furnished to you solely for your benefit in connection with
the closings under the U.S. Purchase Agreement and the International Purchase
Agreement occurring today and is not to be used, circulated, quoted or otherwise
referred to for any other purpose or relied upon by any other person without our
prior express written permission.
Very truly yours,
EXHIBIT A-3
FORM OF OPINION OF COUNSEL OF
SELLING SHAREHOLDERS
TO BE DELIVERED PURSUANT TO
SECTION 5(b)*
November __, 1997
XXXXXXX XXXXX & CO.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
Bear, Xxxxxxx & Co., Inc.
Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities Corporation
Xxxxx Xxxxxx Inc.
as U.S. Representatives of the several
U.S. Underwriters
x/x Xxxxxxx Xxxxx & Xx.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
Xxxxx Xxxxx
Xxxxx Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
XXXXXXX XXXXX INTERNATIONAL
Bear, Xxxxxxx International Limited
Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities Corporation
Xxxxx Xxxxxx Inc.
as Lead Managers for the several International Managers
c/o Merrill Xxxxx International
00 Xxxxxxxxx Xxxxx
Xxxxxx XX0X 0XX
Xxxxxxx
Re: Overallotment Option in Connection
With Public Offering of Shares of
Common Stock of Rayovac Corporation
-----------------------------------
Ladies and Gentlemen:
We have acted as special counsel to Xxxxxx X. Xxx Equity Fund
III, L.P., THL-CCI Limited Partnership, Xxxxxx X. Xxx Foreign Fund III, L.P.,
(each a "Selling Shareholder" and together the "Selling Shareholders") in
connection with the execution and delivery by the Selling Shareholders of (i)
the U.S. Purchase Agreement dated as of November __, 1997 (the "U.S. Purchase
Agreement") among
--------
* Full Form of opinion, including qualifications to be attached prior to
execution.
XXXXXXX XXXXX & CO.
XXXXXXX XXXXX INTERNATIONAL
November __, 1997
Page 2
Rayovac Corporation, a Wisconsin corporation (the "Company"), the Selling
Shareholders, and Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated, Xxxxxxxxx,
Lufkin & Xxxxxxxx Securities Corporation, Bear Xxxxxxx & Co., Inc., and Xxxxx
Xxxxxx Inc. as representatives (the "U.S. Representatives") of the U.S.
Underwriters listed in Schedule A thereto and (ii) the International Purchase
Agreement dated as of November __, 1997 (the "International Purchase Agreement")
among the Company, the Selling Shareholders, and Xxxxxxx Lynch, Pierce, Xxxxxx &
Xxxxx Incorporated, Xxxxxxxxx, Lufkin & Xxxxxxxx Securities Corporation, Bear
Xxxxxxx International Limited, and Xxxxx Xxxxxx Inc. as lead managers (the "Lead
Managers") on behalf of the International Managers listed in Schedule A thereto,
and the sale by the Selling Shareholders to the U.S. Underwriters (as defined in
the U.S. Purchase Agreement) and the International Managers (as defined in the
International Purchase Agreement) of an aggregate of 1,005,000 shares of Common
Stock, par value $0.01 per share, of the Company (the "Common Stock") pursuant
to the exercise by the U.S. Underwriters and the International Managers of the
options granted by the Selling Shareholders, acting severally and not jointly,
to (i) the U.S. Underwriters, acting severally and not jointly, to purchase all
or any part of 804,000 additional shares of Common Stock (the "U.S. Option
Securities") and (ii) the International Managers, acting severally and not
jointly, to purchase all or any part of 201,000 additional shares of Common
Stock (the "International Option Securities," and together with the U.S. Option
Securities, the "Option Shares") to cover over allotments, if any, described in
Section 2(b) of each of the U.S. Purchase Agreement and the International
Purchase Agreement. This opinion is delivered to you pursuant to Section 5(b)
of each of the U.S. Purchase Agreement and the International Purchase Agreement.
Capitalized terms used herein but not otherwise defined herein shall have the
same meaning ascribed to them in the U.S. Purchase Agreement.
In connection with this opinion, we have examined or are familiar with
originals or copies, certified or otherwise identified to our satisfaction, of
(i) the U.S. Purchase Agreement; (ii) the International Purchase Agreement;
(iii) the Irrevocable Power of Attorney and Custody Agreement dated as of
November ___, 1997 among each Selling Shareholder and ________________________,
each acting as Attorney-in-Fact (each, an "Attorney-in-Fact" and together, the
XXXXXXX XXXXX & CO.
XXXXXXX XXXXX INTERNATIONAL
November __, 1997
Page 3
"Attorneys-in-Fact"), and [Firstar Trust Bank], as Custodian (the "Custodian")
(the "Custody Agreement" and together with the U.S. Purchase Agreement and the
International Purchase Agreement, the "Transaction Documents"), (iv) the Limited
Partnership Agreement of Xxxxxx X. Xxx Foreign Fund III, L.P. (the "Foreign
Fund"), dated as of February 6, 1996, by and among THL Equity Advisors III
Limited Partnership, a Massachusetts limited partnership ("Advisors"), and the
limited partners listed on Exhibit A thereto; (v) the Second Amended and
Restated Limited Partnership Agreement of Xxxxxx X. Xxx Equity Fund III, L.P.
(the "Equity Fund" and together with the Foreign Fund, the "Funds"), dated as of
December 22, 1995, by and among Advisors and the limited partners listed on
Exhibit A thereto; (vi) the Thirteenth Amended and Restated Agreement of Limited
Partnership of THL-CCI Limited Partnership ("CCI", and together with the Funds,
the "Partnerships"), dated as of January 17, 1997, by and among THL Investment
Management Corp. and the persons and entities admitted as limited partners;
(vii) the Certificate of Limited Partnership of the Foreign Fund, dated as of
January 23, 1996; (viii) the Certificate of Limited Partnership of the Equity
Fund, dated as of February 14, 1995; (ix) the Certificate of Limited Partnership
of CCI, dated as of July 10, 1992, as amended November 30, 1993 and March 13,
1996; (x) the First Amended and Restated Agreement of Limited Partnership of
Advisors, dated as of August 15, 1995 by and among THL Equity Trust III, a
Massachusetts business trust ("Equity Trust"), and the limited partners
signatories thereto; (xi) the Certificate of Limited Partnership of Advisors,
dated as of February 16, 1995; (xii) the Declaration of Trust of Equity Trust,
made as of February 14, 1995, by and between Xxxxxx X. Xxx, as grantor, and the
trustees signatories thereto; (xiii) the Consent of Trustees of Equity Trust,
dated as of January 17, 1997; (xiv) the Articles of Organization and By-laws of
THL Investment Management Corp., each as in effect as of the date hereof; (xv)
the Consent of Sole Director of THL Investment Management Corp., dated as of
January 17, 1997; (xvi) the Certificate of Advisors, as general partner of the
Equity Fund, dated as of January 17, 1997; (xvii) the Certificate of Advisors,
as general partner of the Foreign Fund, dated as of November __, 1997; (xviii)
the Certificate of Equity Trust, as general partner of Advisors, dated as of
November __, 1997; (xix) the Officer's Certificate of THL Investment Management
Corp., as general partner of CCI, dated as of November __, 1997; (xx) the
Officer's Certificate of THL Investment Management Corp., dated as of November
__, 1997; (xxi) the Certificate of Equity Trust, dated as of November __, 1997
and (xxii) certificates representing the Option Shares. We have also examined
originals or copies, certified or otherwise identified to our satisfaction, of
such records of each of the Partnerships and others and such agreements,
certificates of public officials, certificates of officers or other
representatives of each of the Partnerships and others and such other documents,
certificates and records as we have deemed necessary or appropriate as a basis
for the opinions set forth herein.
XXXXXXX XXXXX & CO.
XXXXXXX XXXXX INTERNATIONAL
November __, 1997
Page 4
In our examination, we have assumed the genuineness of all signatures, the
legal capacity of natural persons, the authenticity of all documents submitted
to us as originals, the conformity to original documents of all documents
submitted to us as certified or photostatic copies and the authenticity of the
originals of such latter documents. As to any facts material to the opinions set
forth herein which we did not independently establish or verify, we have relied
upon statements and representations of officers and other representatives of
each of the Partnerships and others.
As used herein, (i) the term "Applicable Laws" means the General
Corporation Law and Revised Uniform Limited Partnership Act of the State of
Delaware, the Business Corporation Law and the Uniform Limited Partnership Act
of the Commonwealth of Massachusetts and those laws, rules and regulations of
the State of New York and of the United States of America that, in our
experience, are normally applicable to transaction of the type contemplated by
the Transaction Documents, but without our having made any special investigation
concerning the applicability of any other law, rule or regulation; provided,
that such term does not include any federal or state securities or other
antifraud laws or the rules and regulations of the National Association of
Securities Dealers, Inc.; (ii) the term "Applicable Contracts" means those
contracts and agreements listed on Annex A hereto; and (iii) the term
"Governmental Approval" means any consent, approval, license, authorization or
validation of, or filing, recording or registration with, any United States
Federal or Delaware, Massachusetts or New York executive, legislative, judicial,
administrative or regulatory body (a "Governmental Entity"), pursuant to
Applicable Laws.
XXXXXXX XXXXX & CO.
XXXXXXX XXXXX INTERNATIONAL
November __, 1997
Page 5
The opinions expressed herein are limited to (i) the General Corporation
Law and the Revised Uniform Limited Partnership Act of the State of Delaware;
(ii) the Business Corporation Law and the Uniform Limited Partnership Act of the
Commonwealth of Massachusetts; (iii) the laws of the State of New York; and (iv)
the federal laws of the United States of America to the extent specifically
referred to herein.
Based upon and subject to the foregoing, and to the limitations,
qualifications, exceptions and assumptions set forth herein, we are of the
opinion that:
1. No Governmental Approval is required under Applicable Laws in connection
with the offer, sale or delivery of the Option Shares by the Selling
Shareholders under the U.S. Purchase Agreement and the International Purchase
Agreement or the performance by each of the Selling Shareholders of its
obligations under any of the Transaction Documents; provided, that we express no
opinion as to any Governmental Approval which may be required under state
securities laws or that may have become applicable to any Selling Shareholder as
a result of your involvement in the U.S. Purchase Agreement or the International
Purchase Agreement because of your legal or regulatory status or because of any
other facts specifically pertaining to you.
2. Each of the Custody Agreement, the U.S. Purchase Agreement and the
International Purchase Agreement has been duly executed and delivered by each
Selling Shareholder.
3. The Attorney-in-Fact has been duly authorized by each Selling
Shareholder to deliver and sell the U.S. Option Securities and the International
Option Securities on behalf of each Selling Shareholder in accordance with the
terms of each of the U.S. Purchase Agreement and the International Purchase
Agreement.
XXXXXXX XXXXX & CO.
XXXXXXX XXXXX INTERNATIONAL
November __, 1997
Page 6
4. The execution, delivery and performance of each of the Transaction
Documents and the sale and delivery of the U.S. Option Securities and the
International Option Securities and the consummation of the transactions
contemplated in each of the U.S. Purchase Agreement and the International
Purchase Agreement and compliance by each Selling Shareholder with its
obligations under each of the U.S. Purchase Agreement and the International
Purchase Agreement have been duly authorized by all necessary partnership action
on the part of each Selling Shareholder and do not and will not, whether with or
without the giving of notice or passage of time or both, conflict with or
constitute a breach of, or default under any Applicable Law or Governmental
Approval of any Governmental Entity having jurisdiction over any Selling
Shareholder or any of their properties (except for such conflicts, breaches or
defaults or liens, charges or encumbrances which would not have a material
adverse effect on the condition (financial or otherwise), earnings, business
affairs or business prospects of any Selling Shareholder, whether or not arising
in the ordinary course of business) nor will such action result in any violation
of the provisions of the partnership agreements of any of the Selling
Shareholders.
5. To our knowledge, each Selling Shareholder has the power and authority
as a limited partnership to sell, transfer and deliver the U.S. Option
Securities and the International Option Securities pursuant to each of the U.S.
Purchase Agreement and the International Purchase Agreement. Assuming that
neither any U.S. Representatives nor any U.S. Underwriter has notice of adverse
claims with respect to the certificates identified on Schedule A as representing
the U.S. Option Securities, then upon physical delivery to Xxxxxxx Xxxxx & Co.
as designee of the U.S. Representatives in the State of New York of such
certificates indorsed to the U.S. Representatives or indorsed in blank, the U.S.
Representatives will acquire such certificates (and the shares of Common Stock
represented thereby) free of any adverse claims within the meaning of the
Uniform Commercial Code in effect in the State of New York. Assuming that
neither any Lead Manager nor any International Manager has notice of adverse
claims with respect to the certificates identified on Schedule A as representing
the International Option Securities, then upon physical delivery to Xxxxxxx
Xxxxx & Co. as designee of the Lead Managers in the State of New York of such
certificates indorsed to the Lead Managers or indorsed in blank, the Lead
Managers will acquire such certificates (and the shares of Common Stock
represented thereby) free of any adverse claims within the meaning of the
Uniform Commercial Code in effect in the State of New York.
XXXXXXX XXXXX & CO.
XXXXXXX XXXXX INTERNATIONAL
November __, 1997
Page 7
This opinion is furnished to you solely for your benefit in connection with
the closings under the U.S. Purchase Agreement and the International Purchase
Agreement occurring today and is not to be used, circulated, quoted or otherwise
referred to for any other purpose or relied upon by any other person without our
prior express written permission.
Very truly yours,
EXHIBIT B
October ____,1997
XXXXXXX XXXXX & CO.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
Bear, Xxxxxxx & Co., Inc.
Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities Corporation
Xxxxx Xxxxxx, Inc.
as U.S. Representatives of the several
U.S. Underwriters to be named in the
within-mentioned U.S. Purchase Agreement
Xxxxxxx Xxxxx International
Bear, Xxxxxxx International Limited
Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities Corporation
Xxxxx Xxxxxx, Inc.
as Lead Managers for the several
Managers to be named in the within-
mentioned International Purchase Agreement
x/x Xxxxxxx Xxxxx & Xx.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
Xxxxx Xxxxx
Xxxxx Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Re: Proposed Public Offering by Rayovac Corporation
Dear Sirs:
The undersigned, a stockholder [and an [officer] or [director]] of
Rayovac Corporation, a Wisconsin corporation (the "Company"), understands that
Xxxxxxx Xxxxx & Co., Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated
("Xxxxxxx Xxxxx"), Bear, Xxxxxxx & Co. Inc., Xxxxxxxxx, Xxxxxx & Xxxxxxxx
Securities Corporation and Xxxxx Xxxxxx Inc. propose to enter into a U.S.
Purchase Agreement (the "U.S. Purchase Agreement") with the Company, providing
for the public offering of shares (the "Securities") of the Company's common
stock, par value $0.01 per share (the "Common Stock"). In recognition of the
benefit that such an offering will confer upon the undersigned as a stockholder
of the company and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the undersigned agrees with each
underwriter to be named in the U.S. Purchase Agreement that, during a period of
180 days from the date of the U.S.
-1-
Purchase Agreement, the undersigned will not, without the prior written consent
of Xxxxxxx Xxxxx, directly or indirectly, (i) offer, pledge, sell, contract to
sell, sell any option or contract to purchase, purchase any option or contract
to sell, grant any option, right or warrant for the sale of, or otherwise
dispose of or transfer any shares of the Company's Common Stock or any
securities convertible into or exchangeable or exercisable for Common Stock,
whether now owned or hereafter acquired by the undersigned or with respect to
which the undersigned has or hereafter acquires the power of disposition, or
file any registration statement under the Securities Act of 1933, as amended,
with respect to any of the foregoing or (ii) enter into any swap or any other
agreement or any transaction that transfers, in whole or in part, directly or
indirectly, the economic consequence of ownership of the Common Stock, whether
any such swap or transaction is to be settled by delivery of Common Stock or
other securities, in cash or otherwise.
Notwithstanding the foregoing, the undersigned may transfer any or all
of its shares of Company Common Stock (i) by gift, will or intestacy, (ii) to
its affiliates, as such term is defined in Rule 405 promulgated under the
Securities Act of 1933, as amended, or (iii) in the event the undersigned is an
individual, to his or her immediate family or to a trust the beneficiaries of
which are exclusively the undersigned and/or a member or members of his or her
immediate family; provided, however, that in any such case it shall be a
condition to any such transfer that the transferee execute an agreement stating
that the transferee is receiving and holding the shares subject to the
provisions of this letter agreement and there shall be no further transfer of
such shares except in accordance with the provisions of this letter agreement.
Very truly yours,
Signature: ___________________________
Print Name: __________________________
-2-
EXHIBIT C-1
FORM OF COMFORT LETTER OF
KPMG PEAT MARWICK LLP PURSUANT TO SECTION 5(f)
(i) We are independent public accountants with respect to the Company
within the meaning of the 1933 Act and the applicable published 1933 Act
Regulations.
(ii) In our opinion, the audited financial statements and the related
financial statement schedules included in the Registration Statement and the
Prospectuses comply as to form in all material respects with the applicable
accounting requirements of the 1933 Act and the published rules and regulations
thereunder.
(iii) On the basis of procedures (but not an examination in accordance
with generally accepted auditing standards) consisting of a reading of the
unaudited interim consolidated financial statements of the Company for the
periods ______________ and________________ included in the Registration
Statement and the Prospectuses (collectively, the "Quarterly Financials"), a
reading of the minutes of all meetings of the stockholders and directors of the
Company and its Subsidiaries and the committees of the Company's Board of
Directors and any subsidiary committees since October 1, 1997, inquiries of
certain officials of the Company and its subsidiaries responsible for financial
and accounting matters, a review of interim financial information in accordance
with standards established by the American Institute of Certified Public
Accountants in Statement on Auditing Standards No. 71, Interim Financial
Information ("SAS 71"), with respect to the Quarterly Financials and such other
inquiries and procedures as may be specified in such letter, nothing came to our
attention that caused us to believe that:
(A) the Quarterly Financials included in the Registration
Statement and the Prospectuses do not comply as to form in
all material respects with the applicable accounting
requirements of the 1933 Act and the 1933 Act Regulations
or any material modifications should be made to the
unaudited consolidated financial statements included in
the Registration Statement and the Prospectuses for them
to be in conformity with generally accepted accounting
principles;
(B) at a specified date not more than five days prior to the
date of this Agreement, there was any change in the common
stock of the Company and its subsidiaries or any decrease
in the working capital, total assets, total current assets
or stockholder's equity of the Company and its
subsidiaries or any increase in the long-term debt or
total liabilities of the Company and its subsidiaries, in
each case as compared with amounts shown in the latest
balance sheet included in the Registration Statement,
except in each case for changes, decreases or increases
that the Registration Statement discloses have occurred or
may occur; or
(C) for the period from September 30, 1997 to a specified date
not more than five days prior to the date of this
Agreement, there was any decrease in net sales, gross
profit, income from operations before non-recurring
charges, income (loss) from operations, interest expense,
net income in each case as compared with the
-1-
comparable period in the preceding year, except in each
case for any decreases that the Registration Statement
discloses have occurred or may occur.
(iv) Based upon the procedures set forth in clause (iii) above and a
reading of the Selected Financial Data included in the Registration Statement
and a reading of the financial statements from which such data were derived,
nothing came to our attention that caused us to believe that the Selected
Financial Data included in the Registration Statement do not comply as to form
in all material respects with the disclosure requirements of Item 301 of
Regulation S-K of the 1933 Act, that the amounts included in the Selected
Financial Data are not in agreement with the corresponding amounts in the
audited consolidated financial statements for the respective periods or that the
financial statements not included in the Registration Statement from which
certain of such data were derived are not in conformity with generally accepted
accounting principles.
(v) We have compared the information in the Registration Statement
under selected captions with the disclosure requirements of Regulation S-K of
the 1933 Act and on the basis of limited procedures specified herein. nothing
came to our attention that caused us to believe that this information does not
comply as to form in all material respects with the disclosure requirements of
Items 302, 402 and 503(d), respectively, of Regulation S-K.
(vi) We are unable to and do not express any opinion on the Pro Forma
Financial Information included in the Registration Statement or on the pro forma
adjustments applied to the historical amounts included in the Pro Forma
Financial Information. However, for purposes of this letter we have:
(A) read the Pro Forma Financial Information;
(B) performed an audit of the financial statements to which the pro
forma adjustments were applied;
(C) made inquiries of certain officials of the Company who have
responsibility for financial and accounting matters about the basis for their
determination of the pro forma adjustments and whether the Pro Forma Financial
Information complies as to form in all material respects with the applicable
accounting requirements of Rule 11-02 of Regulation S-X; and
(D) proved the arithmetic accuracy of the application of the pro forma
adjustments to the historical amounts in the Pro Forma Financial Information;
and
on the basis of such procedures and such other inquiries and procedures as
specified herein, nothing came to our attention that caused us to believe that
the Pro Forma Financial Information included in the Registration Statement does
not comply as to form in all material respects with the applicable requirements
of Rule 11-02 of Regulation S-X or that the pro forma adjustments have not been
properly applied to the historical amounts in the compilation of those
statements.
(vii) In addition to the procedures referred to in clause (iii) above,
we have performed other procedures, not constituting an audit, with respect to
certain amounts, percentages, numerical data and financial information appearing
in the Registration Statement, which are specified herein, and have compared
certain of such items with, and have found such items to be in agreement with,
the accounting and financial records of the Company.
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EXHIBIT C-2
FORM OF COMFORT LETTER OF
COOPERS & XXXXXXX LLP PURSUANT TO SECTION 5(f)
(i) We are independent public accountants with respect to the Company
and its predecessors within the meaning of the 1933 Act and the applicable
published 1933 Act Regulations.
(ii) In our opinion, the audited financial statements and the related
financial statement schedules of Rayovac Corporation for the Transition Period
ended September 30, 1996, for the fiscal years ended June 30, 1996, 1995 and
1994 included in the Registration Statement and the Prospectuses comply as to
form in all material respects with the applicable accounting requirements of the
1933 Act and the published rules and regulations thereunder.
(iii) In addition, we have performed other procedures, not constituting
an audit, with respect to certain amounts, percentages, numerical data and
financial information appearing in the Registration Statement, which are
specified herein, and have compared certain of such items with, and have found
such items to be in agreement with, the accounting and financial records of the
Company.
-1-
