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EXHIBIT 1.1
2,000,000 CONVERTIBLE TRUST PREFERRED SECURITIES
WALBRO CAPITAL TRUST
and
WALBRO CORPORATION
[ ]% Convertible Trust Preferred Securities
(Liquidation amount $25 per Convertible
Trust Preferred Security)
Guaranteed by and Convertible
into Common Stock of
WALBRO CORPORATION
FORM OF UNDERWRITING AGREEMENT
January [ ], 1997
XXXXX XXXXXX INC.
INTERSTATE/XXXXXXX LANE CORPORATION
As Representatives of the Several Underwriters
c/o XXXXX XXXXXX INC.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Walbro Capital Trust (the "Trust"), a statutory business trust
created under the Business Trust Act (the "Delaware Act") of the State of
Delaware (Chapter 38, Title 12, of the Delaware Code, 12 Del. C. Section 3801 et
seq.), proposes, upon the terms and conditions set forth herein, to issue and
sell 2,000,000 [ ]% Convertible Trust Preferred Securities, liquidation
amount $25 per security (the "Firm Preferred Securities"), to the several
Underwriters named in Schedule I hereto (the "Underwriters"). The Trust also
proposes, upon the terms and conditions set forth herein and solely for the
purpose of covering over-allotments, to issue and sell to the Underwriters up to
an additional 300,000 [ ]% Convertible Trust Preferred Securities,
liquidation amount $25 per security (the "Additional Preferred Securities"). The
Firm Preferred Securities and the Additional Preferred Securities
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are hereinafter collectively referred to as the "Preferred Securities."
Each Preferred Security is convertible at the option of the holder
thereof into shares of common stock, par value $.50 per share (the "Conversion
Shares"), of Walbro Corporation (the "Company" and together with the Trust, the
"Offerors") at a conversion rate of [ ] Conversion Shares for each Preferred
Security, subject to adjustment in certain circumstances. The Preferred
Securities will be guaranteed by the Company, to the extent set forth in the
Prospectus (as defined below), with respect to distributions and amounts payable
upon liquidation or redemption (the "Preferred Securities Guarantee") pursuant
to the Preferred Securities Guarantee Agreement (the "Preferred Securities
Guarantee Agreement") to be dated as of the Closing Date (as defined below)
executed and delivered by the Company and Bankers Trust Company (the "Guarantee
Trustee"), a New York banking corporation, not in its individual capacity
but solely as trustee, for the benefit of the holders from time to time of the
Preferred Securities. The entire proceeds from the sale of the Preferred
Securities will be combined with the entire proceeds from the sale by the Trust
to the Company of its common securities (the "Common Securities") which will be
guaranteed by the Company, to the extent set forth in the Prospectus, with
respect to distributions and amounts payable upon liquidation or redemption (the
"Common Securities Guarantee" and, together with the Preferred Securities
Guarantee, the "Guarantees") pursuant to the Common Securities Guarantee
Agreement (the "Common Securities Guarantee Agreement" and, together with the
Preferred Securities Guarantee Agreement, the "Guarantee Agreements"), to be
dated as of the Closing Date, executed and delivered by the Company for the
benefit of the holders from time to time of the Common Securities, and will be
used by the Trust to purchase the [ ]% Convertible Subordinated Debentures
due 2017 (the "Convertible Debentures") issued by the Company. The Preferred
Securities and the Common Securities will be issued pursuant to the Amended and
Restated Declaration of Trust of the Trust, to be dated as of Closing Date (the
"Declaration"), among the Company, as Sponsor, Bankers Trust Company, as
institutional trustee (the "Institutional Trustee"), Bankers Trust (Delaware),
as Delaware trustee (the "Delaware Trustee"), and Xxxxxxx X. Xxxxxxxx, Xxxxxx
X. Xxxxxxx and Xxxxxxx X. Xxxxx as regular trustees (the "Regular Trustees"
and together with the Institutional Trustee and the Delaware Trustee, the
"Trustees"), and the holders from time to time of undivided beneficial
interests in the assets of the Trust. The Convertible Debentures will be
issued pursuant to an Indenture, to be dated
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as of the Closing Date (the "Indenture"), between the Company and Bankers Trust
Company, as trustee (the "Indenture Trustee"). The Preferred Securities, the
Preferred Securities Guarantee, the Convertible Debentures and the Conversion
Shares are collectively referred to herein as the "Securities." Capitalized
terms used herein without definition have the respective meanings specified in
the Prospectus.
The Offerors wish to confirm as follows their agreement with you and
the other several Underwriters on whose behalf you are acting, in connection
with the several purchases of the Preferred Securities by the Underwriters.
1. Registration Statement and Prospectus. The Offerors have
prepared and filed with the Securities and Exchange Commission (the
"Commission") in accordance with the provisions of the Securities Act of 1933,
as amended, and the rules and regulations of the Commission thereunder
(collectively, the "Securities Act"), a registration statement on Form S-3 (File
No. 333-18317) under the Securities Act (the "registration statement"),
including a prospectus subject to completion relating to the Securities. The
term "Registration Statement" as used in this Agreement means the registration
statement (including all financial schedules and exhibits), as amended at the
time it becomes effective, or, if the registration statement became effective
prior to the execution of this Agreement, as supplemented or amended prior to
the execution of this Agreement. If it is contemplated, at the time this
Agreement is executed, that a post-effective amendment to the registration
statement will be filed and must be declared effective before the offering of
the Preferred Securities may commence, the term "Registration Statement" as used
in this Agreement means the registration statement as amended by said
post-effective amendment. If an additional registration statement is prepared
and filed with the Commission in accordance with Rule 462(b) under the
Securities Act (an "Additional Registration Statement"), the term "Registration
Statement" as used in this Agreement includes the Additional Registration
Statement. The term "Prospectus" as used in this Agreement means the prospectus
in the form included in the Registration Statement as supplemented by the
addition of Rule 430A information contained in the prospectus filed with the
Commission pursuant to Rule 424(b) under the Securities Act. The term
"Prepricing Prospectus" as used in this Agreement means the prospectus subject
to completion relating to the Preferred Securities in the form included in the
registration statement at the time of the initial filing of the registration
statement
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with the Commission, and as such prospectus shall have been amended from time
to time prior to the date of the Prospectus. Any reference in this Agreement to
the registration statement, the Registration Statement, any Prepricing
Prospectus or the Prospectus shall be deemed to refer to and include the
documents incorporated by reference therein pursuant to Form S-3 under the
Securities Act, as of the date of the registration statement, the Registration
Statement, such Prepricing Prospectus or the Prospectus, as the case may be, and
any reference to any amendment or supplement to the registration statement, the
Registration Statement, any Prepricing Prospectus or the Prospectus shall be
deemed to refer to and include any documents filed after such date under the
Securities Exchange Act of 1934, as amended, and the rules and regulations of
the Commission thereunder (collectively, the "Exchange Act") which, upon filing,
are incorporated by reference therein, as required by Form S-3. As used herein,
the term "Incorporated Documents" means the documents which at the time are
incorporated by reference in the registration statement, the Registration
Statement, any Prepricing Prospectus, the Prospectus, or any amendment or
supplement thereto.
2. Agreements to Sell and Purchase. The Trust hereby agrees,
subject to all the terms and conditions set forth herein, to issue and sell to
each Underwriter and, upon the basis of the representations, warranties and
agreements of the Offerors herein contained and subject to all the terms and
conditions set forth herein each Underwriter agrees, severally and not jointly,
to purchase from the Trust, at a purchase price of $[ ] per Firm Preferred
Security, plus accrued distributions, if any from [ ], 1997, the number
of Firm Preferred Securities set forth opposite the name of such Underwriter in
Schedule I hereto (or such number of Firm Preferred Securities increased as set
forth in Section 10 hereof).
The Company agrees that, in view of the fact that the proceeds of the
sale of the Preferred Securities will be invested in the Convertible Debentures,
it shall pay to the Underwriters as compensation ("Underwriters' Compensation")
for their arranging the investment of the proceeds therein, on the Closing Date,
$[ ] per Firm Preferred Security. The Underwriters shall inform the
Company in writing on the Closing Date of the aggregate number of Firm Preferred
Securities so sold.
The Trust also agrees, subject to all the terms and conditions set
forth herein, to sell to the Underwriters, and upon the basis of the
representations, warranties and
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agreements of the Company herein contained and subject to all the terms and
conditions set forth herein, the Underwriters shall have the right to purchase
from the Trust pursuant to an option (the "over-allotment option") which may be
exercised at any one time prior to 9:00 P.M., New York City time, on the 30th
day after the date of the Prospectus (or, if such 30th day shall be a Saturday
or Sunday or a holiday, on the next business day thereafter when the NASDAQ
National Market ("NASDAQ") is open for trading), up to 300,000 Additional
Preferred Securities at the same purchase price as the Firm Preferred
Securities, plus accrued distributions, if any, from [ ], 1997. Upon
exercise of the over-allotment option, each Underwriter, severally and not
jointly, agrees to purchase that number of Additional Preferred Securities
(subject to such adjustments as you may determine in order to avoid fractional
securities) which bears the same proportion to the aggregate number of
Additional Preferred Securities to be purchased by the Underwriters as the
number of Firm Preferred Securities set forth opposite the name of such
Underwriter bears in Schedule I hereto (or such number of Firm Preferred
Securities increased as set forth in Section 10 hereof) to the aggregate number
of Firm Preferred Securities. The Company agrees that it will pay Underwriters'
Compensation on the Option Closing Date (as hereinafter defined) in the amounts
per Preferred Security set forth in the immediately preceding paragraph with
respect to any Additional Preferred Securities purchased by the Underwriters.
3. Terms of Public Offering. The Offerors have been advised by
you that the Underwriters propose to make a public offering of their respective
portions of the Preferred Securities as soon as the Underwriters deem advisable
after the Registration Statement has become effective, this Agreement has been
executed and delivered, and the Declaration, the Preferred Securities Guarantee
Agreement and the Indenture have been qualified under the Trust Indenture Act of
1939, as amended (the "1939 Act"). The entire proceeds from the sale of the
Preferred Securities will be combined with the entire proceeds from the sale by
the Trust to the Company of its Common Securities, and will be used by the Trust
to purchase an equivalent amount of the Convertible Debentures.
4. Delivery of the Preferred Securities and Payment Therefor.
Delivery to the Underwriters of and payment for the Firm Preferred Securities
shall be made at the office of Xxxxx Xxxxxx Inc., 000 Xxxxxxxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000, at 8:30 A.M., New York City time, on [ ], 1997 (the
"Closing Date"). The place of closing for the Preferred Securities
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and the Closing Date may be varied by agreement between you and the Company.
Delivery to the Underwriters of and payment for any Additional
Preferred Securities to be purchased by the Underwriters shall be made at the
aforementioned office of Xxxxx Xxxxxx Inc. at such time and on such date (the
"Option Closing Date"), which may be the same as the Closing Date but shall in
no event be earlier than the Closing Date nor earlier than two nor later than
ten business days after the giving of the notice hereinafter referred to, as
shall be specified in a written notice from you to the Offerors of the
Underwriters' determination to purchase the number of Additional Preferred
Securities specified in such notice. The place of closing for any Additional
Preferred Securities and the Option Closing Date for such Additional Preferred
Securities may be varied by agreement between you and the Offerors.
The Firm Preferred Securities and any Additional Preferred Securities
which the Underwriters may elect to purchase shall be delivered to you for the
accounts of the several Underwriters registered in the name of Cede & Co., as
nominee for the Depository Trust Company, against payment of the purchase price
therefor in immediately available funds. The Preferred Securities to be
delivered to the Underwriters shall be made available to you in New York City
for inspection and packaging not later than 9:30 A.M., New York City time, on
the business day next preceding the Closing Date or the Option Closing Date, as
the case may be.
5. Agreements of the Offerors. The Company and the Trust, jointly
and severally, agree with the several Underwriters as follows:
(a) If, at the time this Agreement is executed and
delivered, it is necessary for the Registration Statement or a post-
effective amendment thereto (or any Additional Registration Statement)
to be declared or to become effective before the offering of the
Securities may commence, the Offerors will endeavor to cause the
Registration Statement or such post-effective amendment to become
effective as soon as possible and will advise you promptly and, if
requested by you, will confirm such advice in writing, when the
Registration Statement or such post-effective amendment (or any
Additional Registration Statement) has become effective.
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(b) The Offerors will advise you promptly and, if requested
by you, will confirm such advice in writing: (i) of any request by
the Commission for amendment of or a supplement to the Registration
Statement, any Prepricing Prospectus or the Prospectus or for
additional information; (ii) of the issuance by the Commission of any
stop order suspending the effectiveness of the Registration Statement
or of the suspension of qualification of the Securities for offering
or sale in any jurisdiction or the initiation of any proceeding for
such purpose; and (iii) within the period of time referred to in
paragraph (f) below, of the happening of any event, which makes any
statement of a material fact made in the Registration Statement or the
Prospectus (as then amended or supplemented) untrue or which requires
the making of any additions to or changes in the Registration
Statement or the Prospectus (as then then amended or supplemented) in
order to state a material fact required by the Securities Act or the
regulations thereunder to be stated therein or necessary in order to
make the statements therein not misleading, or of the necessity to
amend or supplement the Prospectus (as then amended or supplemented)
to comply with the Securities Act or any other law. If at any time
the Commission shall issue any stop order suspending the effectiveness
of the Registration Statement, the Offerors will make every reasonable
effort to obtain the withdrawal of such order at the earliest possible
time.
(c) The Offerors will furnish to you, without charge, (i) 3
copies of the registration statement as originally filed with the
Commission via XXXXX and of each amendment thereto so filed, including
financial statements and all exhibits to the registration statement,
and will furnish you with an equal number of copies of executed
signature pages regarding the same, (ii) such number of conformed
copies of the registration statement as originally filed and of each
amendment thereto, but without exhibits, as you may reasonably request
and (iii) such number of copies of the Declaration, the Preferred
Securities Guarantee Agreement, the Common Securities Guarantee
Agreement and the Indenture and of the Incorporated Documents, as you
may reasonably request.
(d) Prior to the end of the period of time referred to in
the first sentence in subsection (f) below, the Offerors will not file
any amendment to the Registration Statement or any Additional
Registration Statement or make
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any amendment or supplement to the Prospectus to which you shall reasonably
object or file with the Commission any document which upon filing becomes
an Incorporated Document and of which you shall not previously have been
advised.
(e) Prior to the execution and delivery of this Agreement, the
Offerors have delivered to you, without charge, in such quantities as you
have reasonably requested, copies of each Prepricing Prospectus. The
Offerors consent to the use, in accordance with the provisions of the
Securities Act and with the securities or Blue Sky laws of the
jurisdictions in which the Preferred Securities are offered by the several
Underwriters and by dealers, prior to the date of the Prospectus, of each
Prepricing Prospectus so furnished by the Offerors.
(f) As soon after the execution and delivery of this Agreement as
possible and thereafter from time to time for such period as in the opinion
of counsel for the Underwriters a Prospectus is required by the Securities
Act to be delivered in connection with sales by any Underwriter or dealer,
the Offerors will expeditiously deliver to each Underwriter and each
dealer, without charge, as many copies of the Prospectus (and of any
amendment or supplement thereto) as you may reasonably request. The
Offerors' consent to the use of the Prospectus (and of any amendment or
supplement thereto) in accordance with the provisions of the Securities Act
and with the securities or Blue Sky laws of the jurisdictions in which the
Preferred Securities are offered by the several Underwriters and by all
dealers to whom Preferred Securities may be sold, both in connection with
the offering and sale of the Preferred Securities and for such period of
time thereafter as the Prospectus is required by the Securities Act to be
delivered in connection with sales by any Underwriter or dealer. If during
such period of time any event shall occur that in the judgment of the
Offerors or in the opinion of counsel for the Underwriters is required to
be set forth in the Prospectus (as then amended or supplemented) or should
be set forth therein in order to make the statements therein, in the light
of the circumstances under which they were made, not misleading, or if it
is necessary to supplement or amend the Prospectus (or to file under the
Exchange Act any document which upon filing, becomes an Incorporated
Document) in order to comply with the Securities Act or any other law, the
Offerors will forthwith prepare and, subject to the provisions of
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paragraph (d) above, file with the Commission an appropriate supplement or
amendment thereto (or to such document), and will expeditiously furnish to
the Underwriters and dealers a reasonable number of copies thereof. In the
event that the Offerors and you, as Representatives of the several
Underwriters, agree that the Prospectus should be amended or supplemented,
the Offerors or the Company, if requested by you, will promptly issue a
press release announcing or disclosing the matters to be covered by the
proposed amendment or supplement.
(g) The Offerors will cooperate with you and with counsel for the
Underwriters in connection with the registration or qualification of the
Securities for offering and sale by the several Underwriters and by dealers
under the securities or Blue Sky Laws of such jurisdictions as you may
designate and will file such consents to service of process or other
documents necessary or appropriate in order to effect such registration or
qualification; provided that in no event shall the Company or the Trust be
obligated to qualify to do business in any jurisdiction where it is not now
so qualified or to take any action which would subject it to taxation or
service of process in suits, other than those arising out of the offering
or sale of the Preferred Securities, in any jurisdiction where it is not
now so subject.
(h) The Offerors will make generally available to the Trust's
security holders a consolidated earnings statement of the Company, which
need not be audited, covering a twelve-month period commencing after the
effective date of the Registration Statement and ending not later than 15
months thereafter, as soon as practicable after the end of such period,
which consolidated earnings statement shall satisfy the provisions of
Section 11(a) of the Securities Act.
(i) So long as any of the Securities are outstanding, the Company
will furnish to you, (i) as soon as available, a copy of all reports and
other communications (financial or otherwise) of the Company mailed to
stockholders or filed by the Company with the Commission or any national
securities exchange on which any security of the Company may be listed or
quoted and a copy of each Annual Report on Form 10-K, each quarterly report
on Form 10-Q and each current report on Form 8-K filed by the Company with
the Commission under the Exchange Act, and (ii) from time to
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time such other information concerning the Company as you may reasonably
request and the Trust will furnish to you, upon your request, a copy of
each report of the Trust mailed to holders of Preferred Securities or
Common Securities.
(j) If this Agreement shall terminate or shall be terminated
after execution pursuant to any provisions hereof (otherwise than pursuant
to the second paragraph of Section 10 hereof or by notice given by you
terminating this Agreement pursuant to Section 10 hereof) or if this
Agreement shall be terminated by the Underwriters because of any failure or
refusal on the part of the Offerors to comply with the terms or fulfill any
of the conditions of this Agreement, the Company agrees to reimburse the
Underwriters for all reasonable out-of-pocket expenses (including
reasonable fees and expenses of counsel for the Underwriters) incurred by
you in connection herewith.
(k) The Trust will apply the net proceeds from the sale of the
Preferred Securities, and the Company will apply the net proceeds from the
sale of the Convertible Debentures, substantially in accordance with the
description set forth in the Prospectus under "Use of Proceeds".
(l) If required by the rules of the Commission, the Offerors
will timely file the Prospectus pursuant to Rule 424(b) under the
Securities Act and will advise you of the time and manner of such filing.
(m) Each of the Trust and the Company agree, during the period
beginning on the date of this Agreement and continuing to and including the
date that is 90 days after the Closing Date, not to offer, sell,
contract to offer, sell or otherwise dispose of any preferred securities,
any preferred stock, any common stock or any other securities (including
any backup undertakings for such preferred stock or other securities) of
the Company or of the Trust, in each case that are substantially similar
to the Preferred Securities, or any securities convertible into or
exchangeable for the Preferred Securities or such substantially similar
securities of either the Trust or the Company, without the prior written
consent of Xxxxx Xxxxxx Inc.
(n) Except as stated in this Agreement and in the Prepricing
Prospectus and Prospectus, the Company has not
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taken, nor will it take, directly or indirectly, any action designed to or
that might reasonably be expected to cause or result in stabilization or
manipulation of the price of the Preferred Securities to facilitate the
sale or resale of the Preferred Securities.
(o) The Company will use its best efforts to effect the quotation
of the Preferred Securities on the NASDAQ. If the Convertible Debentures
are distributed on the occurrence of a Tax Event (as defined in the
Prospectus), the Company will use its best efforts to effect the quotation
of such Convertible Debentures on the NASDAQ or such other exchange where
the Preferred Securities are listed.
6. Representations and Warranties of the Offerors. The Company
and the Trust, jointly and severally, represent and warrant to, and agree with,
each Underwriter that as of the date hereof, as of the Closing Date referred to
in Section 4 hereof, and as of each Option Closing Date if any, as referred to
in Section 4 hereof:
(a) Each Prepricing Prospectus complied in all material respects
with the provisions of the Securities Act. The Commission has not issued
any order preventing or suspending the use of any Prepricing Prospectus.
(b) Each of the Offerors and the transactions contemplated by
this Agreement meet the requirements for using Form S-3 under the
Securities Act. The registration statement in the form in which it became
or becomes effective and also in such form as it may be when any
post-effective amendment thereto shall become effective, any Additional
Registration statement when filed with the Commission pursuant to Rule
462(b) under the Securities Act and the Prospectus and any supplement and
amendment thereto when filed with the Commission under Rule 424(b) under
the Securities Act complied or will comply in all material respects with
the provisions of the Securities Act and will not at any such times
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, except that this representation and warranty does
not apply to statements in or omissions from the registration statement or
the Prospectus made in reliance upon and in conformity with
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information relating to any Underwriter furnished to the Offerors in
writing by or on behalf of any Underwriter through you expressly for use
therein.
(c) The Incorporated Documents heretofore filed, when they were
filed (or, if any amendment with respect to any such document was filed,
when such amendment was filed), conformed in all material respects with the
requirements of the Exchange Act and the rules and regulations thereunder,
any further Incorporated Documents so filed will, when they are filed,
conform in all material respects with the requirements of the Exchange Act
and the rules and regulations thereunder; no such document when it was
filed (or, if an amendment with respect to any such document was filed,
when such amendment was filed), contained an untrue statement of a material
fact or omitted to state a material fact required to be stated therein or
necessary in order to make the statements therein not misleading; and no
such further document, when it is filed, will contain an untrue statement
of a material fact or will omit to state a material fact required to be
stated therein or necessary in order to make the statements therein not
misleading.
(d) The execution and delivery of, and the performance by the
Company and the Trust of their respective obligations under this Agreement
have been duly and validly authorized by the Company and the Trust,
respectively, and this Agreement has been duly executed and delivered by
the Company and the Trust, respectively, and is enforceable in accordance
with its terms, except as the enforcement thereof may be limited by
bankruptcy, insolvency (including, without limitation, all laws relating to
fraudulent transfers), reorganization, moratorium or other similar laws
affecting enforcement of creditors' rights generally and subject to the
applicability of general principles of equity and except as rights
to indemnity hereunder may be limited by federal securities laws.
(e) The Offerors have not distributed and, prior to the later to
occur of (i) the Closing Date and (ii) completion of the distribution of
the Preferred Securities, will not distribute any offering materials in
connection with the offering and sale of the Preferred Securities other
than the Registration Statement, the Prepricing Prospectus, the Prospectus
or other materials, if any, permitted by the Securities Act.
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(f) Xxxxxx Xxxxxxxx, LLP, the accountants who certified the
financial statements and supporting schedules of the Company, Dyno and
[Xxxxxx] included in the Registration Statement, are independent public
accountants as required by the Securities Act and Securities Act
regulations.
(g) The financial statements included in the Registration
Statement and the Prospectus, together with the related schedules and
notes, present fairly the financial position of the Company and its
consolidated subsidiaries, Dyno and [Xxxxxx] at the dates indicated and the
statement of operations, stockholders' equity and cash flows of the Company
and its consolidated subsidiaries, Dyno and [Xxxxxx] 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, if any,
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 Prospectus
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.
(h) Since the respective dates as of which information is given
in the Registration Statement and the Prospectus, except as otherwise
stated therein, (A) there has been no 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 (a
"Material Adverse Effect") and (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 except as is described in the
Prospectus.
(i) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the state of
Delaware and has corporate power and authority to own, lease and operate
its properties and to conduct its business as described in the Registration
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Statement and the Prospectus and to enter into and perform its obligations
under this Agreement, the Declaration, the Indenture, the Guarantees and
the Convertible Debentures and to purchase, own and hold the Common
Securities issued by the Trust; and the Company is duly registered and
qualified as a foreign corporation to conduct its 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.
(j) Each Significant Subsidiary of the Company as defined in
Rule 1-02 of Regulation S-X under the Securities Act (a "Significant
Subsidiary") has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the jurisdiction of its
incorporation (which is listed opposite the name of each subsidiary in
Schedule II hereto), has corporate power and authority to own, lease and
operate its properties and to conduct its business as described in the
Registration Statement and the Prospectus and is duly registered and
qualified as a foreign corporation to transact business and is in good
standing in each jurisdiction in which the nature of its properties or the
conduct of its business requires such registration or qualification,
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 and the Prospectus, all of the issued and
outstanding capital stock of each such Significant Subsidiary has been
duly authorized and validly issued, is fully paid and non-assessable
and is owned by the Company, directly or through subsidiaries, free and
clear of any security interest, mortgage pledge, lien, encumbrance, claim
or equity; 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 Significant Subsidiaries
of the Company are the subsidiaries listed in Schedule II hereto.
(k) The authorized, issued and outstanding capital stock of the
Company is as set forth in the Prospectus as of the respective dates
presented; and the Preferred Securities, the Common Securities, the
Conversion Shares, the Convertible Debentures, the Declaration, the
Preferred Securities Guarantee Agreement and the Indenture conform in all
material respects to
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the descriptions thereof in the Prospectus under the captions "Description
of the Preferred Securities," "Description of the Guarantee," "Description
of the Convertible Debentures," "Effect of Obligations Under the
Convertible Debentures and the Guarantee" and "Description of Capital
Stock".
(l) The Trust has been duly created and is validly existing in
good standing as a business trust under the Delaware Act with the power and
authority to own property and to conduct its business as described in the
Registration Statement and the Prospectus, and any amendment or supplement
thereto, and to enter into and perform its obligations under this
Agreement, the Preferred Securities, the Common Securities and the
Declaration; the Trust is duly qualified to transact business as a foreign
corporation in good standing in each jurisdiction in which such
qualification is necessary, except to the extent that the failure to so
qualify would not have a Material Adverse Effect on the Trust; and the
Trust is not a party to or otherwise bound by any agreement other than
those described in the Prospectus, and any amendment or supplement thereto.
(m) The Common Securities have been duly authorized by the
Declaration and, when issued and delivered by the Trust to the Company in
accordance with the terms of the Declaration and against payment therefor
as described in the Prospectus, will be validly issued and (subject to the
terms of the Declaration) fully paid and nonassessable undivided beneficial
interests in the assets of the Trust; the issuance of the Common Securities
is not subject to preemptive or other similar rights; no holder thereof
will be subject to personal liability by reason of being such a holder; and
at the Closing Time, all of the issued and outstanding Common Securities of
the Trust will be directly owned by the Company free and clear of any
security interest, mortgage, pledge, lien, encumbrance, claim or equity.
(n) All of the outstanding shares of capital stock of the Company
have been duly authorized and validly issued and are fully paid and
nonassessable; no holder
16
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thereof is or will be subject to personal liability by reason of being such
a holder; and none of the outstanding shares of capital stock of the
Company was issued in violation of the preemptive or other similar rights
of any stockholder of the Company.
(o) The Declaration has been duly and validly authorized by the
Company and, when validly executed and delivered by the Company and the
Regular Trustees, and assuming the due authorization, execution and
delivery of the Declaration by the Delaware Trustee and the Institutional
Trustee, the Declaration will be a valid and legally binding obligation of
the Company and the Regular Trustees, enforceable against the Company and
the Regular Trustees in accordance with its terms, except as enforcement
thereof may be limited by bankruptcy, insolvency (including, without
limitation, all laws relating to fraudulent transfers), reorganization,
moratorium or similar laws affecting enforcement of creditors' rights
generally; and the Declaration has been duly qualified under the 1939 Act
and conforms to the description thereof in the Registration Statement and
the Prospectus and any amendment or supplement thereto;
(p) The Regular Trustees of the Trust are officers of the Company
and have been duly authorized by the Company to execute and deliver the
Declaration.
(q) The Preferred Securities Guarantee Agreement has been duly
and validly authorized by the Company and, when validly executed and
delivered by the Company, and assuming due authorization, execution and
delivery of the Preferred Securities Guarantee Agreement by the Guarantee
Trustee, will constitute a valid and binding obligation of the Company,
enforceable against the Company in accordance with its terms, except as
enforcement thereof may be limited by bankruptcy, insolvency (including,
without limitation, all laws relating to the fraudulent transfers),
reorganization, moratorium or other similar laws affecting enforcement of
creditors' rights generally; and the Preferred Securities Guarantee
Agreement has been duly qualified under the 1939 Act and conforms to the
description thereof in the Registration Statement and the Prospectus and
any amendment or supplement thereto;
17
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(r) The Preferred Securities have been duly and validly
authorized by the Declaration and, when authenticated in the manner
provided for in the Declaration and issued and delivered pursuant to this
Agreement against payment of the consideration set forth herein, will be
validly issued and (subject to the terms of the Declaration) fully paid and
nonassessable undivided beneficial interests in the assets of the Trust;
the issuance of the Preferred Securities is not subject to preemptive or
other similar rights; and holders of Preferred Securities will be entitled
to the same limitation of personal liability extended to stockholders of
private corporations for profit incorporated under the General Corporation
Law of the State of Delaware and the Preferred Securities have been
registered under the Exchange Act and authorization for quoting the
Preferred Securities on the NASDAQ has been given, subject only to official
notice of issuance.
(s) The Indenture has been duly and validly authorized by the
Company, and, when validly executed and delivered by the Company, and
assuming the due authorization, execution and delivery of the Indenture by
the Indenture Trustee, will be a valid and binding obligation of the
Company, enforceable against the Company in accordance with its terms,
except as enforcement thereof may be limited by bankruptcy, insolvency
(including, without limitation, all laws relating to fraudulent transfers),
reorganization, moratorium or other similar laws affecting enforcement of
creditors' rights generally; and the Indenture has been (or will have been)
duly qualified under the 1939 Act and conforms to the description thereof
in the Registration Statement and the Prospectus, and any amendment or
supplement thereto.
(t) The Convertible Debentures have been duly and validly
authorized by the Company, and when validly executed, authenticated, issued
and delivered in the manner provided for in the Indenture and sold and paid
for as provided in this Agreement, the Convertible Debentures will be valid
and binding obligations of the Company entitled to the benefits of the
Indenture and enforceable against the Company in accordance with their
terms, except as enforcement thereof may be limited by bankruptcy,
insolvency (including, without limitation, all laws relating to fraudulent
transfers), reorganization, moratorium or similar laws affecting
enforcement of creditors' rights generally; and the Indenture conforms to
the description
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thereof in the Registration Statement and the Prospectus, and any amendment
or supplement thereto.
(u) The Company's obligations under the Preferred Security
Guarantee are (i) subordinated and junior to all other liabilities of the
Company except any liabilities that may be pari passu expressly by their
terms, (ii) pari passu with the most senior preferred or preference stock,
if any, issued from time to time by the Company and with any guarantee now
or hereafter entered into by the Company in respect of any preferred or
preference stock or preferred securities of any affiliate of the Company
and (iii) senior to the Common Stock.
(v) The Convertible Debentures are subordinate in right of
payment to all existing and future Senior Indebtedness (as defined in the
Indenture) of the Company.
(w) To the knowledge of the Offerors neither the Company nor any
of its subsidiaries is in violation of its charter, by-laws or other
organizational documents; the Trust is not in violation of the Declaration
or its Certificate of Trust filed with the State of Delaware on December
17, 1996; and neither the Company, any Significant Subsidiaries of the
Company or the Trust is 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, any of
its subsidiaries or the Trust 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, any
subsidiary or the Trust is subject (collectively, "Agreements and
Instruments"), except for such defaults that would not result in a
Material Adverse Effect.
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(x) No labor dispute with the employees of the Company or any
subsidiary exists or, to the knowledge of the Company, is imminent, and 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 or contractors, which, in either case, may
reasonably be expected to result in a Material Adverse Effect.
(y) Except as described in the Registration Statement and the
Prospectus, 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, any Significant Subsidiary of the
Company or the Trust, which is required to be disclosed in the
Registration Statement (other than as disclosed therein), or which could
reasonably be expected to result in a Material Adverse Effect, or which
could reasonably be expected to materially and adversely affect the
properties or assets thereof or the consummation of the transactions
contemplated in this Agreement or the performance by the Company or the
Trust of their respective obligations hereunder; the aggregate of all
pending legal or governmental proceedings to which the Company or any
20
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subsidiary of the Company or the Trust 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, could not reasonably be expected to result in a Material
Adverse Effect.
(z) There are not contracts or documents which are required to be
described in the Registration Statement or the Prospectus or to be filed as
exhibits thereto which have not been so described and filed as required.
(aa) Neither the issuance and sale of the Preferred Securities by the
Trust, the extension of the Guarantee by the Company, the issuance and
sale of the Convertible Debentures by the Company, the execution, delivery
or performance of the Declaration, the Indenture and the Guarantees by the
Offerors, nor the consummation by the Offerors of the transactions
contemplated hereby and thereby and compliance by the Offerors with their
respective obligations hereunder and thereunder (A) requires any consent,
approval, authorization or other order of or registration or filing with,
any court, regulatory body, administrative agency or other governmental
body, agency or official (except such as may be required for the
registration of the Securities under the Securities Act and the Exchange
Act and compliance with the securities or Blue Sky laws of various
jurisdictions, all of which have been or will be effected in accordance
with this Agreement) or conflicts or will conflict with or constitutes or
will constitute a breach of, or a default under, the certificate or
articles of incorporation or bylaws, or other organizational documents,
of the Company or any of its Significant Subsidiaries or the Declaration
or Certificate of Trust of the Trust or (B) conflicts or will conflict
with, in any material respect, or constitutes or will constitute a breach
of, or a default, in any material respect, under, any material agreement,
indenture, lease or other instrument to which the Company, any of its
Significant Subsidiaries or the Trust is a party or by which any of them
or any of their respective properties may be bound, except any such
conflict or conflicts that in the aggregate would not result in a
Material Adverse Effect or (C) violates or will violate, in any material
respect, any statute, law, regulation or filing or judgment, injunction,
order or decree of any government, government instrumentality or court,
domestic or foreign, applicable to the Company, any of its Significant
Subsidiaries or the Trust or any of their respective properties, except
any such violation or violations that in the aggregate would not result
in a Material Adverse Effect or (D) will result in the creation or
imposition of any lien, charge or encumbrance upon any property or assets
of the Company, any of its Significant Subsidiaries or the
21
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Trust pursuant to the terms of any agreement or instrument to which any of
them is a party or by which any of them may be bound or to which any of the
property or assets of any of them is subject.
(bb) The Company and its Significant 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; the Company and its Significant
Subsidiaries are in material 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;
and neither the Company nor any of its Significant 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.
(cc) The Company and its Significant 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 material liens, security interests,
claims, restrictions mortgages, pledges, or encumbrances of any kind
except such as (A) are described in the Prospectus of (B) do not, singly
or in the aggregate, materially affect the value of such property and do
not interfere with the use made and currently proposed to be made of such
property by the Company or any of its Significant Subsidiaries; and all of
the leases and subleases material to the business of the Company and its
Significant Subsidiaries, considered as one enterprise, and under which
the Company or any of its Significant Subsidiaries holds properties
described in the Prospectus, are in full force and effect, and neither the
Company nor any Significant Subsidiary has any notice of any material
claim of any sort that has been asserted by anyone adverse to the rights
of the Company or any Significant Subsidiary under any of the leases or
subleases mentioned above, or affecting or questioning the rights of the
Company or such Significant Subsidiaries to the continued possession of
the leased or subleased premises under any such lease or sublease except
as such would not in the aggregate result in a Material Adverse Effect.
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(dd) Neither the Company nor the Trust is, and upon the issuance and
sale of the Preferred Securities as herein contemplated and the application
of the net proceeds therefrom as described in the Prospectus neither will
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").
(ee) Except as would not, singly or in the aggregate, result in a
Material Adverse Effect, (A) neither the Company nor any of its
Significant 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 order, consent, decree or
judgment, relating to pollution or protection of human health, the
environment (including, without limitation, ambient air, surface water,
ground-water, 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 Significant Subsidiaries have all permits, authorizations and
approvals required under any applicable Environmental Laws and are each in
compliance with their requirements, (C) there are no pending or, to the
knowledge of the Company, 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 Significant
Subsidiaries and (D) there are no events or circumstances to the knowledge
of the Company that might reasonably be expected to form the basis of an
order for clean-up or remediation, or an action, suit or proceeding by any
private party or governmental body or agency, against or affecting the
Company or any of its Significant Subsidiaries relating to Hazardous
Materials or any Environmental Laws.
(ff) There are no persons with registrations rights or other similar
rights to have any security registered
23
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pursuant to the Registration Statement.
(gg) The Company and each of its Significant Subsidiaries have filed
all federal or state income and franchise tax returns required to be filed
and have paid all taxes shown thereon as due, and there is no material tax
deficiency which has been or is reasonably likely to be asserted against
the Company or any of its Significant Subsidiaries, except where the
failure to file such returns or pay such taxes would not have a Material
Adverse Effect; all material tax liabilities of the Company and its
Significant Subsidiaries are adequately provided for on the books of the
Company and its Significant Subsidiaries.
(hh) The Company and each of the Company's Significant Subsidiaries
own or possess all patents, trademarks, trademark registrations,
service marks, service xxxx registrations, trade names, copyrights,
licenses, inventions, trade secrets and rights described in the Prospectus
or Registration Statement as being owned by them or any of them and owns,
possesses or has the right to use all patents, trademarks, trademark
registrations, service marks, service xxxx registrations, trade names,
copyrights, licenses, inventions, trade secrets and rights necessary for
the conduct of their respective businesses, and the Company is not aware
of any claim to the contrary or any challenge by any other person to the
rights of the Company and its Significant Subsidiaries with respect to the
foregoing.
(ii) Each of the Company and its Significant Subsidiaries has
fulfilled its obligations, if any, under the minimum funding standards of
Xxxxxxx 000 xx xxx Xxxxxx Xxxxxx Employee Retirement Income Security Act
of 1974 ("ERISA") and such regulations and published interpretations
thereunder with respect to each "plan" (as defined in ERISA and such
regulations and published interpretations) in which employees of the
Company and its Significant Subsidiaries are eligible to participate and
each such plan is in compliance in all material respects with the
presently applicable provisions of ERISA and such regulations and
published interpretations, and has not incurred any unpaid liability to
the Pension Benefit Guaranty Corporation (other than for the payment of
premiums in the ordinary course) or to any such plan under Title IV of
ERISA.
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7. Indemnification and Contribution. (a) Each of the Trust and
the Company, jointly and severally, agrees to indemnify and hold harmless each
of you and each other Underwriter and each person, if any, who controls any
Underwriter within the meaning of Section 15 of the Securities Act or Section 20
of the Exchange Act from and against any and all losses, claims, damages,
liabilities and expenses (including reasonable costs of investigation) arising
out of or based upon any untruestatement or alleged untrue statement of a
material fact contained in any Prepricing Prospectus or in the Registration
Statement or the Prospectus or in any amendment or supplement thereto, or
arising out of or based upon any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, except insofar as such losses, claims, damages,
liabilities or expenses arise out of or are based upon any untrue statement or
omission or alleged untrue statement or omission which has been made therein or
omitted therefrom in reliance upon and in conformity with the information
relating to such reliance upon and in conformity with the information relating
to such Underwriter furnished in writing to the Offerors by or on behalf of any
Underwriter through you expressly for use in connection therewith; provided,
however, that the indemnification contained in this paragraph (a) with respect
to any Prepricing Prospectus shall not inure to the benefit of any Underwriter
(or to the benefit of any person controlling such Underwriter) to the extent
that any such loss, claim, damage, liability or expense arises from the sale of
the Preferred Securities by such Underwriter to any person if it shall be
established that a copy of the Prospectus shall not have been delivered or sent
to such person within the time
25
-25-
required by the Securities Act and the regulations thereunder, and the untrue
statement or alleged untrue statement or omission or alleged omission of a
material fact contained in such Prepricing Prospectus was corrected in the
Prospectus and such correction would have cured the defect giving rise to such
loss, claim, damage, liability or expense, provided that the Offerors have
delivered the Prospectus to the several Underwriters in such quantity as the
Underwriters reasonably request on a timely basis to permit such delivery or
sending. The foregoing indemnity agreement shall be in addition to any
liability which the Trust or the Company may otherwise have.
(b) If any action, suit or proceeding shall be brought against
any Underwriter or any person controlling any Underwriter in respect of which
indemnity may be sought against the Trust or the Company, such underwriter or
such controlling person shall promptly notify the Trust and the Company, and the
Trust or the Company shall assume the defense thereof, including the employment
of counsel and payment of all fees and expenses. Such Underwriter or any such
controlling person shall have the right to employ separate counsel in any such
action, suit or proceeding and to participate in the defense thereof, but the
fees and expenses of such counsel shall be at the expense of such Underwriter or
such controlling person unless (i) the Trust or the Company has agreed in
writing to pay such fees and expenses, (ii) the Trust or the Company has failed
to assume the defense and employ counsel, or (iii) the named parties to any such
action, suit or proceeding (including any impleaded parties) include both such
Underwriter or such controlling person and the Trust or the Company, and such
Underwriter or such controlling person shall have been advised by its counsel
that representation of such indemnified party and the Trust or the Company by
thesame counsel would be inappropriate under applicable standards of
professional conduct (whether or not such representation by the same counsel has
been proposed) due to actual or potential differing interests between them (in
which case the Trust or the Company shall not have the right to assume the
defense of such action, suit or proceeding on behalf of such Underwriter or such
controlling person). It is understood, however, that the Trust and the Company
together shall, in connection with any one such action, suit or proceeding or
separate but substantially similar or related actions, suits or proceedings in
the same jurisdiction arising out of the same general allegations or
circumstances, be liable for the reasonable fees and expenses of only one
separate firm of attorneys (in addition to any local counsel) at any time for
all such Underwriters and controlling persons
26
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not having actual or potential differing interests with you or among themselves,
which firm shall be designated in writing by Xxxxx Xxxxxx Inc., and that all
such fees and expenses shall be reimbursed as they are incurred. The Trust and
the Company shall not be liable for any settlement of any such action, suit or
proceeding effected without the Company's written consent, but if settled with
such written consent, or if there be a final judgment for the plaintiff in any
such action, suit or proceeding, the Trust and the Company agree to indemnify
and hold harmless any Underwriter, to the extent provided in the preceding
paragraph, and any such controlling person from and against any loss, claim,
damage, liability or expense by reason of such settlement or judgment.
(c) Each Underwriter agrees, severally and not jointly, to
indemnify and hold harmless the Trust, the Company, the Company's directors,
the Company's officers and the Regular Trustees who sign the Registration
Statement, and any person who controls the Company within the meaning of
Section 15 of the Securities Act or Section 20 of the Exchange Act, to the same
extent as the foregoing indemnity from the Trust and the Company to each
Underwriter, but only with respect to information relating to such Underwriter
furnished in writing by or on behalf of such Underwriter through you expressly
for use in the Registration Statement, the Prospectus or any Prepricing
Prospectus, or any amendment or supplement thereto. If any action, suit or
proceeding shall be brought against the Trust, the Company, any of the
Company's directors, any such officer or Regular Trustee, or any such
controlling person, based on the Registration Statement, the Prospectus or any
Prepricing Prospectus, or any amendment or supplement thereto, and in respect
of which indemnity may be sought against any Underwriter pursuant to this
paragraph (c), such Underwriter shall have the rights and duties given to the
Trust or the Company by paragraph (b) above (except that if the Trust or the
Company shall have assumed the defense thereof, such Underwriter shall not be
required to do so, but may employ separate counsel therein and participate in
the defense thereof, but the fees and expenses of such counsel shall be at such
Underwriter's expense), Regular Trustee and the Trust, the Company, the
Company's directors, any such officer or trustee, and any such controlling
person shall have the rights and duties given to the Underwriters by paragraph
(b) above. The foregoing indemnity agreement shall be in addition to any
liability which the Underwriters may otherwise have.
(d) If the indemnification provided for in this Section 7 is
unavailable to an indemnified party under
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paragraphs (a) or (c) hereof in respect of any losses, claims, damages,
liabilities or expenses referred to therein, then an indemnifying party, in lieu
of indemnifying such indemnified party, shall contribute to the amount paid or
payable by such indemnified party as a result of such losses, claims, damages,
liabilities or expenses (i) in such proportion as is appropriate to reflect the
relative benefits received by the Trust and the Company on the one hand and the
Underwriters on the other hand from the offering of the Preferred Securities, or
(ii) if the allocation provided by clause (i) above is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) above but also the relative fault of
the Trust and the Company on the one hand and the Underwriters on the other in
connection with the statements or omissions that resulted in such losses,
claims, damages, liabilities or expenses, as well as any other relevant
equitable considerations. The relative benefits received by the Trust and the
Company on the one hand and the Underwriters on the other shall be deemed to be
in the same proportion as the total net proceeds from the offering (before
deducting expenses) received by the Trust bear to the total compensation
received by the Underwriters, in each case as set forth in the table on the
cover page of the Prospectus. The relative fault of the Trust and the
Company on the one hand and the Underwriters on the other hand shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the Offerors on the one hand
or by the Underwriters on the other hand and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.
(e) The Trust, the Company and the Underwriters agree that it
would not be just and equitable if contribution pursuant to this Section 7 were
determined by a pro rata allocation (even if the Underwriters were treated as
one entity for such purpose) or by any other method of allocation that does not
take account of the equitable considerations referred to in paragraph (d) above.
The amount paid or payable by an indemnified party as a result of the losses,
claims, damages, liabilities and expenses referred to in paragraph (d) above
shall be deemed to include, subject to the limitations set forth above, any
legal or other expenses reasonably incurred by such indemnified party in
connection with investigating any claim or defending any such action, suit or
proceeding. Notwithstanding the provisions of this Section 7, no Underwriter
shall be
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required to contribute any amount in excess of the amount by which the total
price ofthe Preferred Securities underwritten by it and distributed to the
public exceeds the amount of any damages which such Underwriter has otherwise
been required to pay by reason of such untrue or alleged untrue statement or
omission or alleged omission. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations to contribute pursuant to this
Section 7 are several in proportion to the respective numbers of Preferred
Securities set forth opposite their names in Schedule I hereto (or such numbers
of Preferred Securities increased as set forth in Section 10 hereof) and not
joint.
(f) No indemnifying party shall, without the prior written
consent of the indemnified party, effect any settlement, compromise or consent
relating to any pending or threatened action, suit or proceeding in respect of
which any indemnified party is or could have been a party and indemnity could
have been sought hereunder by such indemnified party, unless such settlement,
compromise or consent (i) includes an unconditional release of such indemnified
party from all liability on claims that are the subject matter of such action,
suit or proceeding and (ii) does not include a statement as to or an admission
of fault or culpability by or on behalf of any indemnified party.
(g) Any losses, claims, damages, liabilities or expenses for
which an indemnified party is entitled to indemnification or contribution under
this Section 7 shall be paid by the indemnifying party to the indemnified party
as such losses, claims, damages, liabilities or expenses are incurred. The
indemnity and contribution agreements contained in this Section 7 and the
representations and warranties of the Trust and the Company set forth in this
Agreement shall remain operative and in full force and effect, regardless of (i)
any investigation made by or on behalf of any Underwriter or any person
controlling any Underwriter, the Trust, the Company, the Company's directors or
officers, the Regular Trustees, or any person controlling the Company, (ii)
acceptance of any Preferred Securities and payment therefor hereunder, and (iii)
any termination of this Agreement. A successor to any Underwriter or any
person controlling any Underwriter, or to the Trust, the Company, the Company's
directors or officers, the Regular Trustees, or any person controlling the
Company, shall be entitled to the
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benefits of the indemnity, contribution, and reimbursement agreements contained
in this Section 7.
8. Conditions of Underwriters' Obligations. The obligations of
the several Underwriters to purchase and pay for the Preferred Securities as
provided herein shall be subject to the accuracy, as of the date of this
Agreement and the Closing Date (as if made at the Closing Date), of the
representations and warranties of the Offerors herein, to the performance by
theOfferors of their obligations hereunder, and to the following additional
conditions:
(a) If, at the time this Agreement is executed and delivered, it
is necessary for the registration statement or a post- effective amendment
thereto (or an Additional Registration Statement) to be declared or to become
effective before the offering of the Preferred Securities may commence, the
registration statement or such post-effective amendment or Additional
Registration Statement shall have become effective not later than 5:30 P.M., New
York City time, on the date hereof, or at such later date and time as shall be
consented to in writing by you, and all filings, if any, required by Rules 424
and 430A under the Securities Act shall have been timely made; and no stop order
suspending the effectiveness of the registration statement shall have been
issued and no proceeding for that purpose shall have been instituted or, to the
knowledge of the Offerors or any Underwriter, threatened by the Commission, and
any request of the Commission for additional information (to be included in the
registration statement or the Prospectus or otherwise) shall have been complied
with to your satisfaction.
(b) Subsequent to the effective date of this Agreement, there
shall not have occurred (i) any change, or any development involving a
prospective change, in or affecting the condition (financial or other),
business, properties, net worth or results of operations of the Company or its
subsidiaries which, in your opinion as Representatives of the several
Underwriters, would materially adversely affect the market for the Preferred
Securities, or (ii) any event or development relating to or involving the
Company or any officer of director of the Company which makes any statement made
in the Prospectus untrue or which, in the opinion of the Company and its counsel
or the Underwriters and their counsel, requires the making of any addition to or
change in the Prospectus in order to state a material fact required by the
Securities Act or any other law to be stated therein or necessary in order to
make the
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statements therein not misleading, if amending or supplementing the Prospectus
to reflect such event or development would, in your opinion, as Representatives
of the several Underwriters, materially adversely affect the market for the
Preferred Securities.
(c) You shall have received an opinion, dated the Closing Date,
of Xxxxxx Xxxxxx & Xxxxx, counsel to the Offerors, substantially in the form
attached hereto as Exhibit A.
(d) You shall have received an opinion, dated the Closing Date,
of Xxxxxxxx Xxxxxx & Finger, special Delaware counsel to the Offerors,
substantially in the form attached hereto as Exhibit B.
(e) You shall have received an opinion, dated the Closing Date,
of Xxxxxx Xxxxxx & Xxxxxxx, counsel for the Underwriters, with respect to such
matters regarding the Offering of the Preferred Securities as you shall
reasonably request.
(f) The Company and the Trust shall each have furnished the
Underwriters with a certificate, dated the Closing Date, and, in the case of the
Company, signed by the Chairman of the Board, any Vice Chairman, the President,
any Executive Vice President, any Vice President, or the Treasurer, and the
principal financial or accounting officer of the Company and, in the case of the
Trust, signed by one of the Regular Trustees to the effect that the signers of
such certificate have carefully examined the Registration Statement, the
Prospectus and this Agreement and that:
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(i) the representations and warranties of the Company or the Trust,
as the case may be, in this Agreement are true and correct on and as of the
Closing Date with the same effect as if made on the Closing Date, and the
Company or the Trust, as the case may be, has complied in all material
respects with all the agreements and satisfied all the conditions on its
part to be performed or satisfied by it hereunder at or prior to the
Closing Date; and
(ii) no stop order suspending the effectiveness of Registration
Statement has been issued, and no proceedings for that purpose have been
instituted or, to their knowledge, threatened.
(g) You shall have received on the date hereof and on the Closing
Date a letter from Xxxxxx Xxxxxxxx LLP, dated as
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of the date hereof and the Closing Date, substantially in the form heretofore
approved by you.
(h) On or after the date of this Agreement no downgrading shall have
occurred in the rating accorded the Preferred Securities or the Company's debt
securities by any "nationally recognized statistical rating organization" (as
defined for purposes of Rule 436(g) under the Securities Act).
(i) The Preferred Securities shall have been registered under the
Exchange Act and shall have been approved for quotation on the NASDAQ.
(j) Prior to the Closing Date, the Company shall have furnished to
you such further information, certificates and documents as you may reasonably
request.
The obligations of the Underwriters to purchase any Additional
Preferred Securities hereunder are subject to the satisfaction on and as of any
Option Closing Date of the conditions set forth in this Section 8, except that,
if any Option Closing Date is other than the Closing Date, thecertificates,
opinions and letters referred to in this Section 8 shall be dated the Option
Closing Date and shall be revised to reflect the sale of the Additional
Preferred Securities.
9. Expenses. The Company agrees to pay the following costs and
expenses and all other costs and expenses incident to the performance by it and
by the Trust of its and the Trust's respective and joint obligations hereunder:
(i) the preparation, printing or reproduction, and filing (including filing
fees) with the Commission of the registration statement (including financial
statements and exhibits thereto), each Prepricing Prospectus, the Prospectus,
each amendment or supplement to any of them and the Statement of Eligibility and
Qualification of each of the Institutional Trustee, the Guarantee Trustee and
the Indenture Trustee; (ii) the printing (or reproduction) and delivery
(including postage, air freight charges and charges for counting and packaging)
of such copies of the registration statement, each Prepricing Prospectus, the
Prospectus, the documents incorporated by reference in the Registration
Statement, and all amendments or supplements to any of them, as may be
reasonably requested for use in connection with the offering and sale of the
Preferred Securities; (iii)
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the preparation, printing, authentication, issuance and delivery of the
Securities, including any stamp taxes in connection with the original issuance
and sale of the Preferred Securities; (iv) the preparation of the preliminary
and supplemental Blue Sky Memoranda in connection with offering of the
Preferred Securities; (v) the registration of the Preferred Securities under the
Exchange Act and the listing of the Preferred Securities on Nasdaq; (vi)
the registration or qualification of the Preferred Securities for offer and
sale under the securities or Blue Sky laws of the several states as provided
in Section 5(g) hereof (including the reasonable fees, expenses and
disbursements of counsel for the Underwriters relating to the preparation,
printing (or reproduction), and delivery of the preliminary and supplemental
Blue Sky Memoranda and such registration and qualification); (vii) the filing
fees and the reasonable fees and expenses of counsel for the Underwriters in
connection with any filings required to be made with the National Association of
Securities Dealers, Inc.; (viii) the fees and expenses of the Institutional
Trustee, the Delaware Trustee, the Guarantee Trustee and the Indenture Trustee;
(ix) the fees and expenses associated with obtaining ratings for the Preferred
Securities from nationally recognized statistical rating organizations; (x) the
transportation and other expenses incurred by or on behalf of the Offerors and
the Underwriters in connection with presentations to prospective purchasers of
the Preferred Securities; and (xi) the fees and expenses of the Company's
accountants and the fees and expenses of counsel (including special Delaware
counsel) for the Offerors.
10. Effective Date of Agreement. This Agreement shall become
effective: (i) upon the execution and delivery hereof by the parties hereto; or
(ii) if, at the time this Agreement isexecuted and delivered, it is necessary
for the registration statement or a post- effective amendment thereto or an
Additional Registration Statement to be declared effective before the offering
of the Preferred Securities may commence, when notification of the effectiveness
of the registration statement or such post-effective amendment has been released
by the Commission or, in the case of an Additional Registration Statement, upon
the filing of such Additional Registration Statement. Until such time as this
Agreement shall have become effective, it may be terminated by the Company or
the Trust, by
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notifying you, or by you, as Representatives of the several Underwriters, by
notifying the Offerors.
If any one or more of the Underwriters shall fail or refuse to
purchase Firm Preferred Securities which it or they are obligated to purchase
hereunder, and the aggregate number of Firm Preferred Securities which such
defaulting Underwriter or Underwriters are obligated but fail or refuse to
purchase is not more than one-tenth of the aggregate number of the Firm
Preferred Securities, each non- defaulting Underwriter shall be obligated,
severally, in the proportion which the number of Firm Preferred Securities set
forth opposite its name in Schedule I hereto bears to the aggregate number of
Firm Preferred Securities set forth opposite the names of all non-defaulting
Underwriters, to purchase the Firm Preferred Securities which such defaulting
Underwriter or Underwriters are obligated, but fail or refuse, to purchase. If
any Underwriter or Underwriters shall fail or refuse to purchase Firm Preferred
Securities and the aggregate number of Firm Preferred Securities with respect to
which such default occurs is more than one-tenth of the aggregate number of the
Firm Preferred Securities and arrangements satisfactory to you and the Offerors
for the purchase of such Firm Preferred Securities by one or more non-defaulting
Underwriters or other party or parties approved by you and the Offerors are not
made within 36 hours after such default, this Agreement will terminate without
liability on the part of any non-defaulting Underwriter or the Offerors. In any
such case which does not result in termination of this Agreement, either you or
the Offerors shall have the right to postpone the Closing Date, but in no event
for longer than seven days, in order that the required changes, if any, in the
Registration Statement and the Prospectus or any other documents or arrangements
may be effected. Any action taken under this paragraph shall not relieve any
defaulting Underwriter from liability in respect of any such default of any such
Underwriter under this Agreement. The term "Underwriter" as used in this
Agreement includes, for all purposes of this Agreement, any party not listed in
Schedule I hereto, who, with your approval and the approval of the Offerors,
purchases Firm Preferred Securities which a defaulting Underwriter is obligated,
but fails or refuses, to purchase.
Any notice under this Section 10 may be given by telegram, telecopy or
telephone but shall be subsequently confirmed by letter.
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11. Termination of Agreement. This Agreement shall be subject to
termination in your absolute discretion, without liability on the part of any
Underwriter to the Offerors, by notice to the Offerors, if prior to the Closing
Date or any Option Closing Date (if different from the Closing Date and then
only as to the Additional Preferred Securities) there shall have occurred: (i)
any suspension or limitation of trading in securities generally on the New York
Stock Exchange, the American Stock Exchange or the NASDAQ National Market, or
any setting of minimum prices for trading on any such exchange, or any
suspension of trading of any securities of the Company on any exchange or in the
over-the-counter market; (ii) any banking moratorium declared by Federal or New
York authorities; or (iii) any outbreak or escalation of hostilities or other
international or domestic calamity, crisis or change in political, financial or
economic conditions, the effect of which on the financial markets of the United
States is such as to make it, in your judgment, impracticable or inadvisable to
commence or continue the offering of the Preferred Securities on the terms set
forth on the cover page of the Prospectus or to enforce contracts for the resale
of the Preferred Securities by the Underwriters. Notice of such termination may
be given to the Company by telegram, telecopy or telephone and shall be
subsequently confirmed by letter.
12. Information Furnished by the Underwriters. The statements
set forth in the last paragraph on the cover page, the stabilization legend on
the third page, and the statements in the first paragraph and the sixth
paragraph under the caption "Underwriting" in the Prospectus, constitute the
only information furnished by or on behalf of the Underwriters through you as
such information is referred to in Sections 6(b) and 7 hereof.
13. Miscellaneous. Except as otherwise provided herein, notice
given pursuant to any provision of this Agreement shall be in writing and shall
be delivered (i) if to the Offerors, to the Company or to the Trust, care of the
Company, at the office of the Company at 0000 Xxxxxxxx Xxxxxx, Xxxx Xxxx,
Xxxxxxxx 00000, Attention: Xxxxxxx X. Xxxxxxxx, with a copy to Xxxxxx Xxxxxx &
Zavis, 000 Xxxx Xxxxxx Xxxxxx, Xxxxx 0000, Xxxxxxx, Xxxxxxxx 00000-0000,
Attention: Xxxxxx X. Xxxxxxx, Esq.; or (ii) if to you, as Representatives of
the several Underwriters, care of Xxxxx Xxxxxx Inc., 000 Xxxxxxxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000, Attention: Manager, Investment Banking Division, with a
copy to General Counsel, Investment
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Banking Division and to Xxxxxx Xxxxxx & Xxxxxxx, 00 Xxxx Xxxxxx, Xxx Xxxx, Xxx
Xxxx 00000, Attention: Xxxxxxx X. Xxxxxxxx, Esq.
This Agreement has been and is made solely for the benefit of the
several Underwriters, the Trust, the Company, the Company's directors and
officers, the Regular Trustees,, and the other controlling persons referred to
in Section 7 hereof and their respective successors and assigns, to the extent
provided herein, and no other person shall acquire or have any right underor by
virtue of this Agreement. Neither the term "successor" nor the term "successors
and assigns" as used in this Agreement shall include a purchaser from any
Underwriter of any of the Preferred Securities in his status as such purchaser.
14. Applicable Law; Counterparts. This Agreement shall be
governed by and construed in accordance with the laws of the State of New York
applicable to contracts made and to be performed within the Sate of New York.
This Agreement may be signed in various counterparts which together
constitute one and the same instrument. If signed in counterparts, this
Agreement shall not become effective unless at least one counterpart hereof
shall have been executed and delivered on behalf of each party hereto.
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Please confirm that the foregoing correctly sets forth the
agreement among the Trust, the Company and the several Underwriters.
Very truly yours,
WALBRO CAPITAL TRUST
By: Walbro Corporation, as
Sponsor
By: _______________________________
Name: Xxxxxxx X. Xxxxxxxx
Title: Chairman and Chief
Executive Officer
WALBRO CORPORATION
By________________________________
Name: Xxxxxxx X. Xxxxxxxx
Title: Chairman and Chief Executive
Officer
Confirmed as of the date first
above mentioned on behalf of
themselves and the other several
Underwriters named in Schedule I
hereto.
XXXXX XXXXXX INC.
INTERSTATE/XXXXXXX XXXX CORPORATION
As Representatives of the Several Underwriters
By XXXXX XXXXXX INC.
By ___________________________
Name:
Title:
38
SCHEDULE I
WALBRO CAPITAL TRUST
[ ]% Convertible Trust Preferred Securities
Number of Firm
Underwriters Preferred Securities
Xxxxx Xxxxxx Inc. . . . . . . . . . . . . . . . . . . . .
Interstate/Xxxxxxx Lane . . . . . . . . . . . . . . . . . ____________
Total . . . . . . . . . . . . . . . . . . . . . 2,000,000
39
SCHEDULE II
Subsidiaries of Walbro Corporation
40
EXHIBIT A
[Form of Opinion of Xxxxxx Xxxxxx & Xxxxx]
41
EXHIBIT B
[Form of Opinion of Xxxxxxxx Xxxxxx & Finger]
