EXHIBIT 1
XXXX-XXXXXX AUTOMOTIVE, INC.
(A DELAWARE CORPORATION)
DEBT SECURITIES
UNDERWRITING AGREEMENT BASIC PROVISIONS
Xxxx-Xxxxxx Automotive, Inc., a Delaware corporation (the "Company"),
proposes to issue and sell up to $___________ aggregate principal amount of its
senior debt securities (the "Senior Securities") or its subordinated debt
securities (the "Subordinated Securities"), or both, from time to time on terms
to be determined at the time of sale. The Senior Securities will be issued under
an indenture dated as of ___________, 1999 (the "Senior Indenture") between the
Company and __________________________________, trustee. The Subordinated
Securities, if any, would be issued under an indenture to be entered into (the
"Subordinated Indenture") between the Company and
__________________________________, trustee. Each issue of Senior Securities,
and Subordinated Securities may vary, as applicable, as to aggregate principal
amount, maturity date, interest rate or formula and timing of payments thereof,
redemption provisions and sinking fund requirements, if any, and any other
variable terms which the Senior Indenture or the Subordinated Indenture, as the
case may be, contemplates may be set forth in the Senior Securities and
Subordinated Securities as issued from time to time. The Senior Securities and
the Subordinated Securities may be offered either together or separately.
This is to confirm the arrangements with respect to the purchase of
Underwritten Securities from the Company by the Representatives and the several
Underwriters listed in the applicable terms agreement entered into between the
Representatives and the Company of which this Underwriting Agreement is Annex A
thereto (the "Terms Agreement"). With respect to any particular Terms Agreement,
the Terms Agreement, together with the provisions hereof incorporated therein by
reference, is herein referred to as the "Agreement." Terms defined in the Terms
Agreement are used herein as therein defined.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3, including a prospectus,
relating to certain of the Senior and/or Subordinated Securities (including the
Underwritten Securities) and the offering thereof from time to time in
accordance with Rule 415 under the Securities Act of 1933, as amended (the "1933
Act"), and has filed such amendments thereto as may have been required to the
date of the Terms Agreement. Such registration statement as amended has been
declared effective by the Commission, and the Senior Indenture has been
qualified under the Trust Indenture Act of 1939, as amended (the "1939 Act"). As
provided in Section 3(a), a prospectus
supplement reflecting the terms of the Underwritten Securities,
the terms of the offering thereof and the other matters set forth therein
has been prepared and will be filed pursuant to Rule 424 under the 1933 Act.
Such prospectus supplement, in the form first filed after the date
hereof pursuant to Rule 424, is herein referred to as the "Prospectus
Supplement." Such registration statement, as amended at the date hereof,
including the exhibits thereto and the documents incorporated by reference
therein, is herein called the "Registration Statement," and the basic prospectus
included therein relating to all offerings of securities under the Registration
Statement, as supplemented by the Prospectus Supplement, is herein called the
"Prospectus," except that, if such basic prospectus is amended or supplemented
on or prior to the date on which the Prospectus Supplement is first filed
pursuant to Rule 424, the term "Prospectus" shall refer to the basic prospectus
as so amended or supplemented and as supplemented by the Prospectus Supplement,
in either case including the documents filed by the Company with the Commission
pursuant to the Securities Exchange Act of 1934, as amended (the "1934 Act"),
that are incorporated by reference therein. The term "preliminary prospectus
supplement" means each preliminary prospectus supplement specifically relating
to the Underwritten Securities and previously filed pursuant to Rule 424(b),
including all documents incorporated by reference therein filed under the 0000
Xxx. If the Company files a registration statement with the Commission pursuant
to Rule 462(b) (the "Rule 462(b) Registration Statement") of the rules and
regulations of the 1933 Act (the "1933 Act Regulations"), then, after such
filing, all references to the "Registration Statement" shall also be deemed to
include the Rule 462(b) Registration Statement.
SECTION 1. REPRESENTATIONS AND WARRANTIES. The Company represents and
warrants to the Representatives and to each Underwriter named in a Terms
Agreement as of the date thereof and as of the related Closing Time (each a
"Representation Date"), as follows:
(a) The Company meets the requirements for use of Form S-3 under
the 1933 Act and the Registration Statement and the Prospectus, at the
time the Registration Statement became effective and as of the
applicable Representation Date, complied and will comply in all material
respects with the requirements of the 1933 Act, the 1933 Act Regulations
and the 1939 Act and the rules and regulations of the Commission under
the 1939 Act (the "1939 Act Regulations"). The Registration Statement,
at the time the Registration Statement became effective and as of the
applicable Representation Date, 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. The Prospectus, at the time the Registration Statement
became effective and as of the applicable Representation Date, did not,
and will not, contain an untrue statement of a material fact 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 the representations and warranties in this
subsection shall not apply to statements in or omissions from the
Registration Statement or Prospectus made
2
in reliance upon and in conformity with information furnished
in writing to the Company by or on behalf of any Underwriter
through the Representatives expressly for use in the Registration
Statement or Prospectus or to that part of the Registration Statement
which shall constitute the Statement of Eligibility and Qualification
under the 1939 Act (Form T-1) of the Trustees under the Senior
Indenture.
(b) The documents incorporated by reference in the Prospectus
pursuant to Item 12 of Form S-3 under the 1933 Act, at the time they
were or hereafter are filed with the Commission, complied and will
comply, as the case may be, in all material respects with the
requirements of the 1934 Act and the rules and regulations thereunder
(the "1934 Act Regulations") and, when read together and with the other
information in the Prospectus, at the time the Registration Statement
became effective and at the time any amendments thereto become effective
or hereafter during the period specified in Section 3(b), 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, in the light of the circumstances under which they
are made, not misleading.
(c) (A) _____________________, who have certified the financial
statements of the Company and the schedules included or incorporated by
reference in the Registration Statement and Prospectus, and (B)
_________________, who have certified the financial statements of
NSK-Warner Kabushiki Kaisha ("NSK-Warner") included or incorporated by
reference in the Registration Statement and the Prospectus, are
independent public accountants as required by the 1933 Act and the 1933
Act Regulations.
(d) The Company has all requisite corporate power and authority
to execute, deliver and perform its obligations under this Agreement and
any Terms Agreement; and each of this Agreement and any Terms Agreement
has been duly authorized, executed and delivered by the Company.
(e) The consolidated financial statements and the related notes
of the Company and its Subsidiaries (as defined below) included or
incorporated by reference in the Registration Statement present fairly
the consolidated financial position of the Company and its Subsidiaries
as of the dates indicated and the consolidated results of operations and
cash flows of the Company and its Subsidiaries for the periods
specified. Such financial statements have been prepared in conformity
with generally accepted accounting principles applied on a consistent
basis throughout the periods involved (except as set forth in the notes
thereto) and subject, in the case of any interim statements, to normal
year-end audit adjustments. The financial statement schedules, if any,
included in the Registration Statement present fairly the information
required to be stated therein. The selected financial data included or
incorporated by reference in the Prospectus
3
present fairly the information shown therein and have been compiled on
a basis consistent with that of the audited consolidated financial
statements included or incorporated by reference in the Registration
Statement. The pro forma financial information included or
incorporated by reference in the Prospectus present fairly the
information shown therein, has been prepared in accordance with the
applicable requirements of Rule 11-02 of Regulation S-X, has been
properly compiled on the pro forma bases described therein, and, in
the opinion of the Company, the assumptions used in the preparation
thereof are reasonable and the adjustments used therein are
appropriate to give effect to the transactions or circumstances
referred to therein.
(f) The Company is a corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware with
corporate power and authority under such laws to own, lease and operate
its properties and conduct its business as described in the Prospectus.
The Company is duly qualified to transact business as a foreign
corporation and is in good standing in each other jurisdiction in which
it owns or leases property of a nature, or transacts business of a type,
that would make such qualification necessary, except to the extent that
the failure to so qualify or be in good standing would not have a
material adverse effect on the Company and the Subsidiaries, considered
as one enterprise.
(g) The Company's only subsidiaries are set forth in Annex B
hereto (each such corporation is referred to herein as a "Subsidiary"
and, collectively, the "Subsidiaries"). Each Subsidiary is a corporation
duly organized, validly existing and in good standing under the laws of
the jurisdiction of its incorporation with corporate power and authority
under such laws to own, lease and operate its properties and conduct its
business; and each Subsidiary is duly qualified to transact business as
a foreign corporation and is in good standing in each other jurisdiction
in which it owns or leases property of a nature, or transacts business
of a type, that would make such qualification necessary, except to the
extent that the failure to so qualify or be in good standing would not
have a material adverse effect on the Company and the Subsidiaries,
considered as one enterprise. All of the outstanding shares of capital
stock of each Subsidiary have been duly authorized and validly issued
and are fully paid and non-assessable and are owned by the Company,
directly or through one or more of the Subsidiaries, in the percentages
set forth in Exhibit B hereto, free and clear of any pledge, lien,
security interest, charge, claim, equity or encumbrance of any kind.
(h) The Company had at the date indicated a duly authorized and
outstanding capitalization as set forth in the Prospectus under the
caption "Capitalization."
4
(i) The Indenture has been duly authorized by the Company, will
be substantially in the form heretofore delivered to you and, when duly
executed and delivered by the Company and the 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 fraudulent transfers), reorganization, moratorium or
similar laws affecting enforcement of creditors' rights generally and
except as enforcement thereof is subject to general principles of equity
(regardless of whether enforcement is considered in a proceeding in
equity or at law); and the Indenture conforms to the descriptions
thereof in the Prospectus.
(j) The Underwritten Securities have been duly authorized for
issuance and sale pursuant to this Agreement (or will have been so
authorized prior to each issuance of Underwritten Securities) and, when
executed, authenticated, issued and delivered in the manner provided for
in the Indenture and sold and paid for as provided in this Agreement,
the Underwritten Securities will constitute 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 except as enforcement
thereof is subject to general principles of equity (regardless of
whether enforcement is considered in a proceeding in equity or law); and
the Underwritten Securities, the Senior Indenture and the Subordinated
Indenture conform to the descriptions thereof in the Prospectus.
(k) All of the outstanding shares of capital stock of the Company
have been duly authorized and validly issued and are fully paid and
non-assessable; no holder 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 rights of any stockholder of the Company.
(l) Since the respective dates as of which information is given
in the Registration Statement and the Prospectus, except as described in
the Registration Statement and Prospectus, there has not been (i) any
material adverse change in the condition (financial or otherwise),
results of operations, business affairs or business prospects of the
Company and the Subsidiaries considered as one enterprise, whether or
not arising in the ordinary course of business, (ii) any transaction
entered into by the Company or any Subsidiary, other than in the
ordinary course of business, that is material to the Company and the
Subsidiaries, considered as one enterprise, or (iii) any dividend or
distribution of any kind declared, paid or made by the Company on its
capital stock, other than regular quarterly cash dividends declared or
paid on its Common Stock.
5
(m) Neither the Company nor any of its Subsidiaries is in
violation of its certificate of incorporation or in default in the
performance or observance of any obligation, agreement, covenant or
condition contained in any indenture, mortgage, loan agreement, note,
lease or other agreement or instrument to which it is a party or by
which it may be bound or to which any of its properties may be subject,
except for such defaults that would not have a material adverse effect
on the condition (financial or otherwise), results of operations,
business affairs or business prospects of the Company and the
Subsidiaries, considered as one enterprise. The execution and delivery
of this Agreement and the Indenture by the Company, the issuance and
delivery of the Underwritten Securities, the consummation by the Company
of the transactions contemplated in this Agreement and in the
Registration Statement and compliance by the Company with the terms of
this Agreement and the Indenture, have been duly authorized by all
necessary corporate action on the part of the Company and do not violate
and will not result in any violation of the certificate of incorporation
or by-laws of the Company or any Subsidiary, and do not and will not
conflict with, or result in a breach of any of the terms or provisions
of, or constitute a default 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 under (i) any indenture,
mortgage, loan agreement, note, lease or other agreement or instrument
to which the Company or any Subsidiary is a party or by which any of
them may be bound or to which any of their properties may be subject,
except for such conflicts, breaches or defaults or liens, charges or
encumbrances that in the aggregate would not have a material adverse
effect on the condition (financial or otherwise), results of operations,
business affairs or business prospects of the Company and the
Subsidiaries, considered as one enterprise or (ii) any existing
applicable law, rule, regulation, judgment, order or decree of any
government, governmental instrumentality or court, domestic or foreign,
having jurisdiction over the Company or any Subsidiary or any of their
respective properties, except for such conflicts, breaches or defaults
or liens, charges or encumbrances that in the aggregate would not have a
material adverse effect on the condition (financial or otherwise),
results of operations, business affairs or business prospects of the
Company and the Subsidiaries, considered as one enterprise.
(n) No authorization, approval, consent or license of, or any
material filing with, any government, governmental instrumentality or
court, domestic or foreign (other than under the 1933, the 1933 Act
Regulations, the 1939 Act and the securities or Blue Sky laws of the
various states), is legally required for the valid authorization,
issuance, sale and delivery of the Underwritten Securities or for the
execution, delivery or performance of the Indenture by the Company.
(o) Except as disclosed or incorporated by reference in the
Prospectus, there is no action, suit or proceeding before or by any
government, governmental instrumentality
6
or court, domestic or foreign, now pending or, to the knowledge of the
Company, threatened against the Company or any Subsidiary that is
required to be disclosed in the Prospectus or that could result in any
material adverse change in the condition (financial or otherwise),
results of operations, business affairs or business prospects of the
Company and its Subsidiaries, considered as one enterprise, or that
could reasonably be expected to adversely affect the consummation of
the transactions contemplated by this Agreement.
(p) There are no contracts or documents of a character required
pursuant to the 1933 Act to be described in the Registration Statement
or the Prospectus or to be filed as exhibits to the Registration
Statement that are not described and filed as required.
(q) The Company and the Subsidiaries each has good and marketable
title to all properties and assets described in the Prospectus as owned
by it, free and clear of all liens, charges, encumbrances or
restrictions, except such as (i) are described in the Prospectus or (ii)
are neither material in amount nor materially significant in relation to
the business of the Company and the Subsidiaries, considered as one
enterprise; all of the leases and subleases material to the business of
the Company and the Subsidiaries, considered as one enterprise, and
under which the Company or any Subsidiary holds properties described in
the Prospectus, are in full force and effect, and neither the Company
nor any 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
Subsidiary under any of the leases or subleases mentioned above, or
affecting or questioning the rights of such corporation to the continued
possession of the leased or subleased premises under any such lease or
sublease.
(r) The Company and the Subsidiaries each owns, possesses or has
obtained all material governmental licenses, permits, certificates,
consents, orders, approvals and other authorizations, and has made all
filings with all governmental authorities, necessary to own or lease, as
the case may be, and to operate its properties and to carry on its
business as presently conducted, and neither the Company nor any
Subsidiary has received any notice of proceedings relating to revocation
or modification of any such licenses, permits, certificates, consents,
orders, approvals or authorizations, which, singly or in the aggregate,
if not so owned, possessed or obtained or the subject of an unfavorable
ruling, decision or finding, could materially adversely affect the
condition (financial or otherwise), results of operations, business
affairs or business prospects of the Company and the Subsidiaries,
considered as one enterprise.
(s) The Company and the Subsidiaries each owns or possesses, or
can acquire on reasonable terms, adequate patents, patent licenses,
trademarks, service marks and trade names necessary to carry on its
business as presently conducted, and neither the Company nor any
Subsidiary has received any notice of infringement of or conflict with
7
asserted rights of others with respect to any patents, patent licenses,
trademarks, service marks or trade names that in the aggregate, if the
subject of an unfavorable decision, ruling or finding, could reasonably
be expected to materially adversely affect the condition (financial or
otherwise), results of operations, business affairs or business
prospects of the Company and the Subsidiaries, considered as one
enterprise.
(t) Except as disclosed in the Prospectus, to the best knowledge
of the Company, no labor problem exists with its employees or with
employees of the Subsidiaries or is imminent that could reasonably be
expected to materially adversely affect the Company and the
Subsidiaries, considered as one enterprise and, to the knowledge of the
Company, except as disclosed in the Prospectus, the Company is not aware
of any material existing or imminent labor dispute by the employees of
any of its or the Subsidiaries' principal customers that could be
expected to materially adversely affect the Company and the
Subsidiaries, considered as one enterprise.
(u) The Company has not taken and will not take, directly or
indirectly, any action designed to, or that might be reasonably expected
to, cause or result in stabilization or manipulation of the price of the
Underwritten Securities.
(v) Except as disclosed in or incorporated by reference in the
Prospectus and except as would not individually or in the aggregate have
a material adverse effect on the condition (financial or otherwise),
results of operations, business affairs or business prospects of the
Company and the Subsidiaries, considered as one enterprise, (i) the
Company and the Subsidiaries are each in compliance with all applicable
Environmental Laws, (ii) the Company and the Subsidiaries have all
permits, authorizations and approvals required under any applicable
Environmental Laws and are each in compliance with their requirements,
(iii) there are no pending or threatened Environmental Claims against
the Company or any Subsidiary, and (iv) there are no circumstances with
respect to any property or operations of the Company or the Subsidiaries
that could reasonably be anticipated to form the basis of an
Environmental Claim against the Company or the Subsidiaries.
For purposes of this Agreement, the following terms shall have
the following meanings: "Environmental Law" means any United States (or
other applicable jurisdiction's) federal, state, local or municipal
statute, law, rule, regulation, ordinance, code, policy or rule of
common law and any judicial or administrative interpretation thereof
including any judicial or administrative order, consent decree or
judgment, relating to the environment, health, safety or any chemical,
material or substance, exposure to which is prohibited, limited or
regulated by any governmental authority. "Environmental Claims" means
any and all administrative, regulatory or judicial actions,
8
suits, demands, demand letters, claims, liens, notices of
noncompliance or violation, investigations or proceedings relating in
any way to any Environmental Law.
(w) All United States federal income tax returns of the Company
(and any of the Subsidiaries, if not included in the Company's U.S.
consolidated federal income tax return) required by law to be filed have
been properly prepared and filed, and all taxes shown on such returns or
otherwise assessed which are due and payable have been paid. All of the
Company's United States federal tax returns (and any of the
Subsidiaries' tax returns if applicable) for taxable periods through and
including the 1992 federal taxable year have been audited by the
Internal Revenue Service or the statute of limitations for such taxable
years has run and thus, all taxes for such periods have been finally
determined (excluding the effect of any net operating loss or credit
carryovers to such periods). All other tax returns of the Company and
the Subsidiaries required to be filed pursuant to applicable foreign,
state, local or other law have been filed, except insofar as the failure
to file such returns would not have a material adverse effect on the
condition (financial or otherwise), earnings, business affairs or
business prospects of the Company and the Subsidiaries, considered as
one enterprise. The Company and the Subsidiaries have paid (or there has
been paid on their behalf) all taxes which are due and for which no tax
return is required. There are no liens on any of the Company's or the
Subsidiaries' assets for taxes, other than for taxes which have accrued
but which are not yet due and payable. Neither the Company nor any
Subsidiary is liable for any taxes that are imposed on any other person
or corporation (other than for taxes imposed on the Company or the
Subsidiaries), except as set forth in Treasury Regulation 1.1502-6 with
respect to prior consolidated groups of which the Company or its
subsidiaries were members.
(x) With respect to each employee benefit plan, program and
arrangement (including, without limitation, any "employee benefit plan"
as defined in Section 3(3) of the Employee Retirement Income Security
Act of 1974, as amended ("ERISA")) maintained or contributed to by the
Company or any Subsidiary, or with respect to which the Company or any
Subsidiary could incur any liability under ERISA (collectively, the
"Benefit Plans"), no event has occurred and, to the best knowledge of
the Company, there exists no condition or set of circumstances, in
connection with which the Company or any Subsidiary could be subject to
any liability under the terms of such Benefit Plans, applicable law
(including, without limitation, ERISA and the Internal Revenue Code of
1986, as amended (the "Code")) or any applicable agreement (including,
without limitation, the agreement dated as of January 14, 1993 (the
"PBGC Agreement"), among the Pension Benefit Guaranty Corporation (the
"PBGC"), the Company and Xxxx-Xxxxxx Security Corporation ("BWSC")),
that could materially adversely affect the condition (financial or
otherwise), results of operations, business affairs or business
prospects of the Company and the Subsidiaries, considered as one
enterprise. The Company is in compliance in all respects with its
obligations under the PBGC Agreement.
9
Any certificate signed by any officer of the Company or any Subsidiary
and delivered to the Representatives or counsel for the Underwriters in
connection with an offering of Underwritten Securities shall be deemed a
representation and warranty by the Company to each Underwriter participating in
such offering as to the matters covered thereby.
SECTION 2. PURCHASE AND SALE. The obligations of the Underwriters to
purchase, and the Company to sell, the Underwritten Securities shall be
evidenced by the Terms Agreement. The Terms Agreement specifies the principal
amount of the Senior Securities or Subordinated Securities, or both, the names
of the Underwriters participating in the offering (subject to substitution as
provided in Section 10 hereof) and the principal amount of Underwritten
Securities which each Underwriter severally has agreed to purchase, the purchase
price to be paid by the Underwriters for the Underwritten Securities, the
initial public offering price, if any, of the Underwritten Securities, any
delayed delivery arrangements and any terms of the Underwritten Securities not
already specified in the Indenture pursuant to which they are being issued
(including, but not limited to, designations, denominations, current ratings,
interest rates or formulas and payment dates, maturity dates, redemption
provisions and sinking fund requirements).
The several commitments of the Underwriters to purchase Underwritten
Securities pursuant to the Terms Agreement shall be deemed to have been made on
the basis of the representations and warranties herein contained and shall be
subject to the terms and conditions herein set forth.
Payment of the purchase price for, and delivery of, the Underwritten
Securities to be purchased by the Underwriters shall be made at the offices of
___________________, ___ __________________________________________, or at such
other place as shall be agreed upon by the Representatives and the Company, at
10:00 A.M., New York City time, on the third business day (unless postponed in
accordance with the provisions of Section 10) following the date of the Terms
Agreement or such other time as shall be agreed upon by the Representatives and
the Company (each such time and date being referred to as a "Closing Time").
Unless otherwise specified in the Terms Agreement, payment shall be made to the
Company by wire transfer in immediately available funds against delivery to the
Representatives for the respective accounts of the Underwriters of the
Underwritten Securities to be purchased by them. The Underwritten Securities
shall be in such denominations ($1,000 or an integral multiple thereof) and
registered in such names as the Representatives may request in writing at least
two business days before the applicable Closing Time. The Underwritten
Securities, which may be in temporary form, will be made available in New York
City for examination and packaging by the Representatives on or before the first
business day prior to Closing Time.
10
If authorized by the Terms Agreement, the Underwriters named therein may
solicit offers to purchase Underwritten Securities from the Company pursuant to
delayed delivery contracts ("Delayed Delivery Contracts") substantially in the
form of Annex C hereto with such changes therein as the Company may approve. As
compensation for arranging Delayed Delivery Contracts, the Company will pay to
the Representatives at Closing Time, for the accounts of the Underwriters, a fee
equal to that percentage of the principal amount of Senior Securities for which
Delayed Delivery Contracts are made at Closing Time as is specified in the Terms
Agreement. Any Delayed Delivery Contracts are to be with institutional investors
of the types set forth in the Prospectus. At Closing Time the Company will enter
into Delayed Delivery Contracts (for not less than the minimum principal amount
of Senior Securities per Delayed Delivery Contract specified in the applicable
Terms Agreement) with all purchasers proposed by the Underwriters and previously
approved by the Company as provided below, but not for an aggregate principal
amount of Senior Securities in excess of that specified in the Terms Agreement.
The Underwriters will not have any responsibility for the validity or
performance of Delayed Delivery Contracts.
The Representatives shall submit to the Company, at least three business
days prior to Closing Time, the names of any institutional investors with which
it is proposed that the Company will enter into Delayed Delivery Contracts and
the principal amount of Senior Securities to be purchased by each of them, and
the Company will advise the Representatives, at least two business days prior to
Closing Time, of the names of the institutions with which the making of Delayed
Delivery Contracts is approved by the Company and the principal amount of Senior
Securities to be covered by each such Delayed Delivery Contract.
The principal amount of Senior Securities agreed to be purchased by the
respective Underwriters pursuant to the Terms Agreement shall be reduced by the
principal amount of Senior Securities covered by Delayed Delivery Contracts, as
to each Underwriter as set forth in a written notice delivered by the
Representatives to the Company; provided, however, that the total principal
amount of Senior Securities to be purchased by all Underwriters shall be in the
total amount of Senior Securities covered by the applicable Terms Agreement,
less the principal amount of Senior Securities covered by Delayed Delivery
Contracts.
SECTION 3. COVENANTS OF THE COMPANY. The Company covenants with the
Representatives, and with each Underwriter participating in the offering of
Underwritten Securities, as follows:
(a) Immediately following the execution of the Terms Agreement,
the Company will prepare a Prospectus Supplement setting forth the
principal amount of Senior Securities covered thereby and their terms
not otherwise specified in the Senior Indenture, pursuant to which the
Senior Securities are being issued, the names of the Underwriters
participating in the offering and the principal amount of Senior
Securities
11
which each severally has agreed to purchase, the names of the
Underwriters acting as co-managers in connection with the offering,
the price at which the Underwritten Securities are to be purchased by
the Underwriters from the Company, the initial public offering price,
the selling concession and reallowance, if any, any delayed delivery
arrangements, and such other information as the Representatives and
the Company deem appropriate in connection with the offering of the
Underwritten Securities. The Company will promptly transmit copies of
the Prospectus to the Commission for filing pursuant to Rule 424 of
the Regulations and will furnish to the Underwriters named therein as
many copies of any preliminary prospectus supplement and such
Prospectus as the Representatives shall reasonably request.
(b) At any time when the Prospectus is required by the 1933 Act
to be delivered in connection with sales of the Underwritten Securities,
the Company will notify the Representatives immediately, and confirm
such notice in writing, of (i) the effectiveness of any amendment to the
Registration Statement, (ii) the mailing or the delivery to the
Commission for filing of any supplement to the Prospectus or any
document to be filed pursuant to the 1934 Act, (iii) the receipt of any
comments from the Commission with respect to the Registration Statement,
the Prospectus or any supplement to the Prospectus, (iv) any request by
the Commission for any amendment to the Registration Statement or any
amendment or supplement to the Prospectus or for additional information,
and (v) the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or of any order presenting
or suspending the use of any preliminary prospectus supplement, or of
the qualification of the Underwritten Securities for offering or sale in
any jurisdiction, or of the institution or threatening of any proceeding
for any such purposes. The Company will use every reasonable effort to
prevent the issuance of any such stop order or of any order preventing
or suspending such use and, if any stop order is issued, to obtain the
lifting thereof at the earliest possible moment.
(c) The Company has furnished or will furnish to the
Representatives and counsel for the Representatives, without charge, as
many copies (including at least one signed copy) of the Registration
Statement (as originally filed) and of all amendments thereto, whether
filed before or after the Registration Statement becomes effective,
copies of all exhibits and documents filed therewith (including
documents incorporated by reference into the Prospectus pursuant to Item
12 and Rule 412) and signed copies of all consents and certificates of
experts, as you may reasonably request and has furnished or will furnish
to you, for each other Underwriter, one conformed copy of the
Registration Statement as originally filed and of each amendment thereto
(including documents incorporated by reference into the Prospectus but
without exhibits).
12
(d) The Company will comply in all material respects with the
1933 Act and the 1933 Act Regulations, the 1934 Act and the 1934 Act
Regulations and the 1939 Act and the 1939 Act Regulations so as to
permit the completion of the distribution of the Underwritten Securities
as contemplated in this Agreement and in the Prospectus. If, at any time
when a prospectus is required by the 1933 Act or the 1933 Regulations to
be delivered in connection with sales of the Underwritten Securities,
any event shall occur or condition exist as a result of which it is
necessary, in the opinion of counsel for the Underwriters or counsel for
the Company, to amend the Registration Statement or amend or supplement
the Prospectus in order that the Prospectus will not include an untrue
statement of a material fact or omit to state a material fact necessary
in order to make the statements therein not misleading in the light of
the circumstances existing at the time it is delivered to a purchaser,
or if it shall be necessary, in the opinion of either such counsel, at
any such time to amend the Registration Statement or amend or supplement
the Prospectus in order to comply with the requirements of the 1933 Act
or the 1933 Act Regulations, the Company will promptly upon becoming
aware of such event or condition prepare and file with the Commission
such amendment or supplement, whether by filing documents pursuant to
the 1934 Act or otherwise, as may be necessary to correct such untrue
statement or omission or to make the Registration Statement and
Prospectus comply with such requirements.
(e) The Company will use its best efforts in cooperation with the
Underwriter to qualify the Underwritten Securities for offering and sale
under the applicable securities laws of such states and other
jurisdictions as the Representatives may designate; provided, however,
that the Company shall not 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. The Company will
use its best efforts in cooperation with the Underwriters to maintain
such qualifications in effect for as long as may be required for the
distribution of the Underwritten Securities. The Company will file such
statements and reports as may be required by the laws of each
jurisdiction in which the Underwritten Securities have been qualified as
above provided. The Company will also supply the Representatives with
such information as is necessary for the determination of the legality
of the Underwritten Securities for investment under the laws of such
jurisdictions as the Representatives may request.
(f) With respect to each sale of Underwritten Securities, the
Company will make generally available to its security holders as soon as
practicable, but not later than 90 days after the close of the period
covered thereby, earning statements of the Company (in form complying
with the provisions of Rule 158 of the 1933 Act Regulations) covering a
period of 12 months beginning, in each case, not later than the first
day of the
13
Company's fiscal quarter next following the "effective date" (as
defined in Rule 158) of the Registration Statement relating to
Underwritten Securities.
(g) The Company will use the net proceeds received by it from the
sale of the Underwritten Securities in the manner specified in the
Prospectus under the caption "Use of Proceeds."
(h) The Company, during the period when the Prospectus is
required to be delivered under the 1933 Act in connection with the sale
of the Underwritten Securities, will file promptly all documents
required to be filed with the Commission pursuant to Section 13 or 14 of
the 1934 Act.
(i) Between the date of the Terms Agreement or the Closing Time
with respect to the Underwritten Securities covered thereby, the Company
will not, without the Representatives' prior consent, offer or sell, or
enter into any agreement to sell, any debt securities issued or
guaranteed by the Company with a maturity of more than one year in any
public offering (other than the Underwritten Securities), including
additional Senior Securities. This limitation is not applicable to the
public offering of tax-exempt securities guaranteed by the Company.
(j) At any time when the Prospectus is required by the 1933 Act
to be delivered in connection with sales of the Underwritten Securities,
the Company will give the Representatives notice of its intention to
file any amendment to the Registration Statement or any amendment or
supplement to the Prospectus, whether pursuant to the 1934 Act, the 1933
Act or otherwise, will furnish the Representatives with copies of any
such amendment or supplement or other documents proposed to be filed a
reasonable time in advance of filing, and will not file any such
amendment or supplement or other documents in a form to which the
Representatives or counsel for the Underwriters shall reasonably object
in writing.
(k) If the Company elects to rely upon Rule 462(b), the Company
shall both file a Rule 462(b) Registration Statement with the Commission
in compliance with Rule 462(b) and pay the applicable fees in accordance
with Rule 111 of the 1933 Act Regulations by the earlier of (i) 10:00
P.M. Eastern time on the date of the Terms Agreement and (ii) the time
confirmations are sent or given, as specified by Rule 462(b).
SECTION 4. PAYMENT OF EXPENSES. The Company will pay and bear all costs
and 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 as amended, any preliminary prospectus and the Prospectus
and any amendments or supplements thereto, and the cost of furnishing copies
thereof to the
14
Underwriters, (ii) the preparation, printing and distribution of this Agreement,
the Terms Agreement, the Indenture and the Underwritten Securities and the Blue
Sky Survey (which shall not be typeset), (iii) the delivery of the Underwritten
Securities to the Underwriters, (iv) the fees and disbursements of the Company's
counsel and accountants, (v) the qualification of the Underwritten Securities
under applicable securities laws in accordance with Section 3(e) and any filing
for review of the offering with the National Association of Securities Dealers,
Inc., including filing fees and the reasonable fees and disbursements of counsel
for the Underwriters solely in connection therewith and in connection with the
preparation of any Blue Sky Survey and Legal Investment Survey, (vi) the listing
fees and expenses incurred in connection with listing the Underwritten
Securities on the New York Stock Exchange, (vii) any fees charged by rating
agencies for rating the Underwritten Securities and (viii) the fees and expenses
of the Trustee, including the fees and disbursements of counsel for the Trustee,
in connection with the Indenture and the Underwritten Securities.
If this Agreement is terminated by the Representatives in accordance
with the provisions of Section 5 or Section 9(a)(i), the Company shall reimburse
the Underwriters named in the Terms Agreement for all of their out-of-pocket
expenses, including the reasonable fees and disbursements of Shearman & Sterling
as counsel for the Underwriters.
SECTION 5. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. In addition to the
execution and delivery of the Terms Agreement, the obligations of the several
Underwriters to purchase and pay for the Underwriters Securities that they have
respectively agreed to purchase hereunder are subject to the accuracy of the
representations and warranties of the Company as of each Representation Date
contained herein or in certificates of any officer of the Company or any
Subsidiary delivered pursuant to the provisions hereof, to the performance by
the Company of its obligations hereunder and to the following further
conditions:
(a) At the applicable Closing Time, no stop order suspending the
effectiveness of the Registration Statement shall have been issued under
the 1933 Act and no proceedings for that purpose shall have been
instituted or shall be pending or, to the knowledge of the Company,
shall be contemplated by the Commission.
(b) At the applicable Closing Time, the Representatives shall
have received:
(1) A signed opinion of Wachtell, Lipton, Xxxxx & Xxxx,
special counsel for the Company, dated as of Closing Time,
together with signed or reproduced copies of such opinion for
each of the other Underwriters, in form and substance reasonably
satisfactory to counsel for the Underwriters, in the form set
forth in Exhibit A hereto.
15
(2) A signed opinion of Xxxxxxx X. Xxxxxxxx, Esq., Vice
President, Secretary and General Counsel for the Company, dated
as of the Closing Time, together with signed or reproduced copies
of such opinion for each of the other Underwriters, in form and
substance reasonably satisfactory to counsel for the
Underwriters, in the form set forth in Exhibit B hereto.
(3) A signed opinion of NSK-Warner's Japanese counsel,
dated as of the Closing Time, together with signed or reproduced
copies of such opinion for each of the other Underwriters, in
form and substance reasonably satisfactory to counsel for the
Underwriters, in the form set forth in Exhibit C hereto.
(4) The favorable opinion of ___________________, counsel
for the Underwriters, dated as of the Closing Time, together with
signed or reproduced copies of such opinion for each of the other
Underwriters, to the effect that the opinions delivered pursuant
to Section 5(b)(i), 5(b)(2) and 5(b)(3) hereof appear on their
face to be appropriately responsive to the requirements of this
Agreement except, specifying the same, to the extent waived by
you, and with respect to the incorporation and legal existence of
the Company, this Agreement, the Indenture, the Registration
Statement, the Prospectus and such other related matters as you
may require. 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, the federal law of the United
States and the General Corporation Law of the State of Delaware,
upon the opinions of counsel satisfactory to you. 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 the Subsidiaries and
certificates of public officials.
(c) At the Closing Time, (i) the Registration Statement and the
Prospectus, as they may then be amended or supplemented, shall comply in
all material respects with the requirements of the 1933 Act and the 1933
Act Regulations and the 1939 Act and the 1939 Act Regulations, and
neither the Registration Statement nor the Prospectus, as they may then
be amended or supplemented, shall 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, (ii)
there shall not have been, since the respective dates as of which
information is given in the Registration Statement, any material adverse
change in the condition (financial or otherwise), results of operations,
business affairs or business prospects of the Company and the
Subsidiaries, considered as one enterprise, whether or not arising in
the ordinary course of business, (iii) no action, suit or proceeding at
law or in equity shall be pending or, to the knowledge of the Company,
threatened against the Company or any Subsidiary that would be required
to be set forth in the Prospectus other than as set forth therein and no
proceedings shall be pending or, to
16
the knowledge of the Company, threatened against the Company or any
Subsidiary before or by any federal, state or other commission, board
or administrative agency wherein an unfavorable decision, ruling or
finding could materially adversely affect the condition (financial or
otherwise), results of operations, business affairs or business
prospects of the Company and the Subsidiaries, considered as one
enterprise, other than as set forth in the Prospectus, (iv) the
Company shall have complied with all agreements and satisfied all
conditions set forth in this Agreement on its part to be performed or
satisfied at or prior to the Closing Time and (v) the other
representations and warranties of the Company set forth in Section 1
shall be accurate as though expressly made at and as of the Closing
Time. At the Closing Time, you shall have received a certificate of
the President or a Vice President, and the Treasurer or an Assistant
Treasurer, of the Company, dated as of the Closing Time, to such
effect.
(d) At the time that this Agreement is executed by the Company,
you shall have received from _____________________ a letter, dated such
date, in form and substance satisfactory to you, together with signed or
reproduced copies of such letter for each of the other Underwriters,
confirming that they are independent public accountants with respect to
the Company within the meaning of the 1933 Act and the applicable
published 1933 Act Regulations, and stating in effect that:
(i) in their opinion, the audited financial statements and
the related financial statement schedules included or
incorporated by reference in the Registration Statement and the
Prospectus comply as to form in all material respects with the
applicable accounting requirements of the 1933 Act and the 1933
Act Regulations;
(ii) 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 included or incorporated by reference
in the Registration Statement and the Prospectus (collectively,
the "10-Q Financials"), a reading of the latest available
unaudited interim consolidated financial statements of the
Company, a reading of the minutes of all meetings of the
stockholders and directors of the Company and the Subsidiaries
and each Committee of the Company's Board of Directors and of
each Committee of the Board of Directors of any Subsidiary since
_________, ____, inquiries of certain officials of the Company
and the Subsidiaries responsible for financial and accounting
matters, and such other inquiries and procedures as may be
specified in such letter, nothing came to their attention that
caused them to believe that:
17
(A) the 10-Q Financials incorporated by reference
in the Registration Statement and the Prospectus do not
comply as to form in all material respects with the
accounting requirements of the 1934 Act and the 1934 Act
Regulations applicable to unaudited financial statements
included in Form 10-Q or any material modifications should
be made to the 10-Q Financials included or incorporated by
reference in the Registration Statement and the Prospectus
for them to be in conformity with generally accepted
accounting principles;
(B) at _________________ and at a specified date
not more than three days prior to the date of this
Agreement, there was any change in the capital stock of
the Company and the Subsidiaries or any decrease in the
consolidated net current assets or stockholders' equity of
the Company and the Subsidiaries or any increase in
long-term debt of the Company and the Subsidiaries, in
each case as compared with amounts shown in the latest
consolidated balance sheet included or incorporated by
reference 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 _______________ to
_____________ and for the period from _______________ to a
specified date not more than three days prior to the date
of this Agreement, there was any decrease in net sales,
equity in affiliate earnings and other income, earnings
before interest and finance charges and income taxes or
net earnings, in each case as compared with the comparable
period in the preceding year;
(iii) based upon the procedures set forth in clause (ii)
above and a reading of the Selected Historical Financial Data
included in the Registration Statement and a reading of the
financial statements from which certain of such data were
derived, nothing has come to their attention that gives them
reason to believe that the Selected Historical Financial Data
included in the Registration Statement do not comply as to form
in all material respects with the applicable accounting
requirements of the 1933 Act and the 1933 Act Regulations, that
the information set forth therein is not fairly stated in
relation to the financial statements from which it was derived 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 applied
on a basis substantially consistent with that of the audited
financial statements included in the Registration Statement; and
18
(iv) they are unable to and do not express any opinion on
the Pro Forma Financial Data (the "Pro Forma Statement") included
or incorporated by reference in the Registration Statement or on
the pro forma adjustments applied to the historical amounts
included in the Pro Forma Statement; however, for purposes of
such letter they have:
(A) read the Pro Forma Statement;
(B) 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
Statement complies as to form in all material respects
with the applicable accounting requirements of Rule 11-02
of Regulation S-X; and
(C) proved the arithmetic accuracy of the
application of the pro forma adjustments to the historical
amounts in the Pro Forma Statement; and
on the basis of such procedures, and such other inquiries and
procedures as may be specified in such letter, nothing came to
their attention that caused them to believe that the Pro Forma
Statement included or incorporated by reference 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;
(v) in addition to the procedures referred to in clause
(ii) above, they have performed other specified procedures, not
constituting an audit, with respect to certain amounts,
percentages, numerical data and financial information appearing
in the Registration Statement, which have previously been
specified by you and which shall be specified in such letter, 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.
(e) At the time that this Agreement is executed by the Company,
you shall have received from _________________ a letter, dated such
date, in form and substance satisfactory to you, together with signed or
reproduced copies of such letter for each of the other Underwriters,
confirming that they are independent public accountants with respect to
the NSK-Warner within the meaning of the 1933 Act and applicable
published 1933 Act Regulations, and stating in effect that:
19
(i) in their opinion, the audited financial statements and
the related financial statement schedules for NSK-Warner included
or incorporated by reference in the Registration Statement and
the Prospectus comply as to form in all material respects with
the applicable accounting requirements of the 1933 Act and the
1933 Act Regulations;
(ii) they have read the latest available unaudited interim
consolidated financial statements of NSK-Warner, the minutes of
all meetings of the stockholders and directors of NSK-Warner and
each Committee of the Board of Directors since _____________,
inquired of certain officials of NSK-Warner responsible for
financial and accounting matters, and made such other inquiries
and performed such other procedures as may be specified in such
letter, and officials of NSK-Warner stated that:
(A) at _________________ and at a specified date
not more than three days prior to the date of this
Agreement, there was no change in the common stock of
NSK-Warner or decrease in the net current assets or
stockholders' equity of NSK-Warner or increase in the
notes payable or long-term debt of NSK-Warner, in each
case as compared with amounts shown in the latest balance
sheet included or incorporated by reference in the
Registration Statement; or
(B) for the period from _____________ to
_________________ and from _______________ to a specified
date not more than three days prior to the date of this
Agreement, there was no decrease in sales, earnings before
income taxes or net earnings, in each case as compared
with the corresponding period in the preceding year.
(f) At the Closing Time, you shall have received from each of
_____________________ and _________________ a letter, in form and
substance satisfactory to you and dated as of the Closing Time, to the
effect that they reaffirm the statements made in the letters furnished
pursuant to Sections 5(d) and 5(e), respectively, except that the
specified date referred to shall be a date not more than five days prior
to the Closing Time.
(g) Subsequent to the execution and delivery of any Terms
Agreement and prior to the Closing Time, there shall not have been any
downgrading, nor any notice given of any intended or potential
downgrading or of a possible change that does not indicate the direction
of the possible change, in the rating accorded any of the Company's
securities, including the Underwritten Securities, by any "nationally
recognized statistical
20
rating organization," as such term is defined for purposes of Rule
436(g)(2) under the 0000 Xxx.
(h) At the applicable Closing Time, counsel for the Underwriters
shall have been furnished with all such documents, certificates and
opinions as they may reasonably request for the purpose of enabling them
to pass upon the issuance and sale of the Underwritten Securities as
herein contemplated and related proceedings or in order to evidence the
accuracy and completeness of any of the representations and warranties,
or the fulfillment of any of the conditions, herein contained; and all
proceedings taken by the Company in connection with the issuance and
sale of the Underwritten Securities as herein contemplated shall be
reasonably satisfactory in form and substance to the Representatives and
counsel for the Underwriters.
If any of the conditions specified in this Section shall not have been
fulfilled when and as required by this Agreement to be fulfilled, this Agreement
may be terminated by the Representatives by notice to the Company at any time at
or prior to the applicable Closing Time, and such termination shall be without
liability of any party to any other party except as provided in Section 4
hereof. Notwithstanding any such termination, the provisions of Sections 6, 7
and 8 shall remain in effect.
SECTION 6. INDEMNIFICATION OF UNDERWRITERS. (a) (1) The Company agrees
to indemnify and hold harmless each Underwriter and each person, if any, who
controls any Underwriter within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act as follows:
(i) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of any untrue statement or
alleged untrue statement of a material fact contained in the
Registration Statement (or any amendment thereto), and all documents
incorporated therein by reference, 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 an
untrue statement or alleged untrue statement of a material fact
contained in any preliminary prospectus or the Prospectus (or any
amendment or supplement thereto) or the omission or alleged omission
therefrom, of a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made,
not misleading;
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate amount
paid in settlement of any litigation, or 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, if such settlement is
effected
21
with the written consent of the Company, except as otherwise provided
by Section 6(d); and
(iii) against any and all expense whatsoever, as incurred
(including fees and disbursements of counsel chosen by you), reasonably
incurred in investigating, preparing or defending against any
litigation, or investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever based upon any
such untrue statement or omission, or any such alleged untrue statement
or omission, to the extent that any such expense is not paid under (i)
or (ii) above;
provided, however, that this indemnity agreement does not apply to any loss,
liability, claim, damage or expense to the extent arising out of an untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Company by any
Underwriter through you expressly for use in the Registration Statement (or any
amendment thereto) or any preliminary prospectus or the Prospectus (or any
amendment or supplement thereto).
(2) Insofar as this indemnity agreement may permit indemnification for
liabilities under the 1933 Act of any person who is a partner of an Underwriter
or who controls an Underwriter within the meaning of Section 15 of the 1933 Act
or Section 20 of the 1934 Act and who, at the date of this Agreement, is a
director, officer or controlling person of the Company, such indemnity agreement
is subject to the undertaking of the Company in the Registration Statement under
Item 17 thereof.
(b) INDEMNIFICATION OF COMPANY, DIRECTORS AND ITS OFFICERS. Each
Underwriter 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, against any and all loss, liability,
claim, damage and expense described in the indemnity contained in subsection (a)
of this Section, as incurred, but only with respect to untrue statements or
omissions, or alleged untrue statements or omissions made in the Registration
Statement (or any amendment thereto), or any preliminary prospectus or the
Prospectus (or any amendment or supplement thereto) in reliance upon and in
conformity with written information furnished to the Company by or on behalf of
such Underwriter through the Representatives expressly for use in the
Registration Statement (or any amendment thereto) or such preliminary prospectus
or the Prospectus (or any amendment or supplement thereto).
(c) ACTIONS AGAINST PARTIES; NOTIFICATION. Each indemnified party shall
give notice as promptly as reasonably practicable to each indemnifying party of
any action commenced against it in respect of which indemnity may be sought
hereunder, but failure to so notify an indemnifying party shall not relieve it
from any liability which it may have otherwise than on
22
account of this indemnity agreement. In the case of parties indemnified pursuant
to Section 6(a) above, counsel to the indemnified parties shall be selected by
the Representatives in the case of parties indemnified pursuant to Sections 6(b)
above, counsel to the indemnified parties shall be selected by the Company. An
indemnifying party may participate at its own expense in the defense of any such
action; provided, however, that counsel to the indemnifying party shall not
(except with the consent of the indemnified party) also be counsel to the
indemnified party. In no event shall the indemnifying party or parties be liable
for the fees and expenses of more than one counsel (in addition to any 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.
No indemnifying party shall, without the prior written consent of the
indemnified parties, which consent shall not be unreasonably withheld, 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
a statement as to or an admission of fault, culpability or a failure to act by
or on behalf of any indemnified party.
(d) SETTLEMENT WITHOUT CONSENT IF FAILURE TO REIMBURSE. If at any time
an indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel, such indemnifying party
agrees that it shall be liable for any settlement of the nature contemplated by
Section 6(a)(ii) effected without its written consent if (i) such settlement is
entered into more than 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 for fees and expenses of
counsel prior to the date of such settlement.
SECTION 7. CONTRIBUTION. If 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 on the one
hand and the Underwriters on the other hand from the offering of the
Underwritten 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 on the one hand and of the
Underwriters on the other hand in
23
connection with the statements or omissions which resulted in such losses,
liabilities, claims, damages or expenses, as well as any other relevant
equitable considerations.
The relative benefits received by the Company on the one hand and the
Underwriters on the other hand in connection with the offering of the
Underwritten 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
Underwritten Securities pursuant to this Agreement (before deducting expenses)
received by the Company and the total underwriting discount received by the
Underwriters, in each case as set forth on the cover of the Prospectus.
The relative fault of the Company on the one hand and the Underwriters
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 related to information
supplied by the Company or by the Underwriters and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.
The Company and the Underwriters 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 Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take account of the
equitable considerations referred to above in this 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 Underwriter shall
be required to contribute any amount in excess of the amount by which the total
price at which the Underwritten Securities underwritten by it and distributed to
the public were offered to the public exceeds the amount of any damages which
such Underwriter has otherwise been required to pay by reason of 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, each person, if any, who controls an
Underwriter 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 Underwriter, and
each director of the Company, each officer of the
24
Company who signed the Registration Statement, and each person, if any, who
controls the Company within the meaning of Section 15 of the 1933 Act or Section
20 of the 1934 Act shall have the same rights to contribution as the Company.
The Underwriters' respective obligations to contribute pursuant to this Section
7 are several in proportion to the principal amount of Underwritten Securities
set forth opposite their respective names in Schedule A hereto and not joint.
SECTION 8. REPRESENTATIONS, WARRANTIES AND AGREEMENTS TO SURVIVE
DELIVERY. The representations, warranties, indemnities, agreements and other
statements of the Company or its officers set forth in or made pursuant to this
Agreement will remain operative and in full force and effect regardless of any
investigation made by or on behalf of the Company, any Underwriter or any person
who controls any Underwriter within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act, and will survive delivery of and payment for the
Underwritten Shares.
SECTION 9. TERMINATION. (a) The Representatives may terminate this
Agreement, by notice to the Company, at any time prior to the applicable Closing
Time (i) if there has been, since the date of the Terms Agreement or since the
respective dates as of which information is given in the Registration Statement,
any material adverse change in the condition (financial or otherwise), earnings,
business affairs or business prospects of the Company and the Subsidiaries
considered as one enterprise, whether or not arising in the ordinary course of
business, or (ii) if there has occurred any material adverse change in the
financial markets in the United States, or any outbreak of hostilities or
escalation thereof or other calamity or crisis or any change or development
involving a prospective adverse change in national or international political,
financial or economic conditions, in each case the effect of which on the
financial markets of the United States is such as to make it, in the judgment of
the Representatives, impracticable to market the Underwritten Securities or
enforce contracts for the sale of the Underwritten Securities, or (iii) if
trading in any securities of the Company has been suspended 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 on the Nasdaq has been suspended or
materially limited, or minimum or maximum prices for trading have been fixed, or
maximum ranges for prices for securities have been required, by such exchange or
by such system or by order of the Commission, the New York Stock Exchange, the
NASD or any other governmental authority, or (iv) if a banking moratorium has
been declared by either Federal, New York or Illinois authorities. For purposes
of this Section 9(a), the deployment of a Level 1 trading halt by the New York
Stock Exchange in and of itself shall not constitute a material limitation on
trading on such exchanges or by such system.
(b) If this Agreement is terminated pursuant to this Section, such
termination shall be without liability of any party to any other party, except
to the extent provided in Section 4.
25
Notwithstanding any such termination, the provisions of Sections 1, 6, 7 and 8
shall remain in effect.
SECTION 10. DEFAULT. If one or more of the Underwriters participating in
an offering of Senior Securities shall fail at the applicable Closing Time to
purchase the Underwritten Securities that it or they are obligated to purchase
under the applicable Terms Agreement (the "Defaulted Securities"), then the
Representatives shall have the right, within 24 hours thereafter, to make
arrangements for one or more of the non-defaulting Underwriters, or any other
underwriters, satisfactory to the Company to purchase all, but not less than
all, of the Defaulted Securities in such amounts as may be agreed upon and upon
the terms set forth in this Agreement and the applicable Terms Agreement. If,
however, during such 24 hours the shall not have completed such arrangements for
the purchase of all of the Defaulted Securities, then:
(a) if the aggregate principal amount of Defaulted Securities
does not exceed 10% of the aggregate principal amount of the
Underwritten Securities to be purchased pursuant to the Terms Agreement,
the non-defaulting Underwriters named in such Terms Agreement shall be
obligated to purchase the full amount thereof in the proportions that
their respective underwriting obligations thereunder bear to the
underwriting obligations of all such non-defaulting Underwriters, or
(b) if the aggregate principal amount of Defaulted Securities
exceeds 10% of the aggregate principal amount of the Underwritten
Securities to be purchased pursuant to such Terms Agreement, the Terms
Agreement shall terminate without any liability on the part of any
non-defaulting Underwriters.
As used in this Section only, the aggregate amount or aggregate
principal amount of Underwritten Securities shall mean the aggregate principal
amount of any Senior Securities or Subordinated Securities included in the
relevant Underwritten Securities.
No action taken pursuant to this Section shall relieve any defaulting
Underwriter from liability in respect of its default under this Agreement and
the Terms Agreement.
In the event of a default by any Underwriter or Underwriters as set
forth in this Section, either the Representatives or the Company shall have the
right to postpone the applicable Closing Time 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
"Underwriter" includes any person substituted for an Underwriter under this
Section.
SECTION 11. NOTICES. All notices and other communications under this
Agreement shall be in writing and shall be deemed to have been duly given if
delivered, mailed or transmitted by
26
any standard form of telecommunication. Notices to the Underwriters shall be
directed to the Representatives at ___________________________ notices to the
Company shall be directed to it at 000 Xxxxx Xxxxxxxx Xxxxxx, Xxxxxxx, Xxxxxxxx
00000, Attention: General Counsel.
SECTION 12. PARTIES. This Agreement shall inure to the benefit of and be
binding upon the Company and any Underwriter who becomes a party hereto, 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 parties hereto or thereto 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 parties 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 Underwritten Securities from any Underwriter 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 the
laws of the State of New York. Specified times of the day refer to New York City
time.
SECTION 14. COUNTERPARTS. The Terms Agreement may be executed in one or
more counterparts, and when a counterpart has been executed by each party, all
such counterparts taken together shall constitute one and the same agreement.
27
ANNEX A
XXXX-XXXXXX AUTOMOTIVE, INC.
(A DELAWARE CORPORATION)
$ ___,000,000
__ % SENIOR NOTES DUE 20__
TERMS AGREEMENT
Dated: ________ __ , 1999
Xxxx-Xxxxxx Automotive, Inc.
000 Xxxxx Xxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Dear Sirs:
We (the "Representatives") understand that Xxxx-Xxxxxx Automotive, Inc.,
a Delaware corporation (the "Company"), proposes to issue and sell $ _______
aggregate principal amount of its __% Senior Notes due 20__ (the "Notes due
20__") (collectively, the "Underwritten Securities"). Subject to the terms and
conditions set forth herein or incorporated by reference herein, the Company has
agreed to sell to the underwriters named below (the "Underwriters"), and the
Underwriters have agreed, severally and not jointly, to purchase from the
Company, the amounts of Notes due 20__ set forth below opposite their respective
names at the purchase prices set forth below.
PRINCIPAL
AMOUNT
OF NOTES
UNDERWRITER DUE 20__
--------------------------------------------- -----------------
Total........................................
The Underwritten Securities shall have the following terms:
Title of Debt Securities: __% Senior Notes due 20__
A-2
Currency: U.S. dollars
Principal amount to be
issued:
$ __________ Notes due 20__
Current ratings: Xxxxx'x Investors Service, Inc. --;
Standard & Poor's Corporation --.
Interest rate: __% Senior Notes due 20__.
Spread:
Interest Payment Dates: __________ and _______ __, beginning __, 1999
Regular Record Dates: __________ or _______
Stated Maturity Dates: Senior Notes due 20__: __, 20__
Optional Redemption: Redemption at option of Company, in whole at
any time, or in part from time to time, at a redemption
price equal to the greater of : (1) 100% of such Notes
principal amount and (2) the sum of the present values of
the remaining scheduled payments of principal and interest
discounted to the date of redemption on a semi-annual basis
(assuming a 360-day year consisting of twelve 30-day
months) at the Treasury Rate plus __ basis points in the
case of the Notes due 20__, accrued and unpaid interest on
the principal amount being redeemed to such redemption
date.
Sinking fund requirements: None
Delayed Delivery Contracts: authorized
Date of delivery:
Minimum contract:
Maximum aggregate principal amount:
Fee: %
Initial public offering price for Notes due 20__: __%, plus accrued interest, if
any, or amortized original issue discount, if any, from __, 1999.
A-3
Purchase price for Notes due 20__: __%, plus accrued interest, if any, or
amortized original issue discount, if any, from __, 1999 (payable in
immediately available funds).
Form: Book-entry represented by global securities deposited with The
Depository Trust Company.
Ranking: Senior, unsecured obligations of the Company.
Closing Date and Location: __, 0000, Xxx Xxxx, Xxx Xxxx.
All the provisions contained in the document attached as Annex A hereto
entitled "Xxxx-Xxxxxx Automotive, Inc.--Debt Securities--Underwriting Agreement
Basic Provisions" are hereby incorporated by reference in their entirety herein
and shall be deemed to be a part of this Terms Agreement to the same extent as
if such provisions had been set forth in full herein. Terms defined in such
document are used herein as therein defined.
A-4
If the foregoing is in accordance with your understanding of our
agreement, please sign a copy of this Terms Agreement in the space set forth
below and return the signed copy to us.
Very truly yours,
By: _____________________________
By ________________________________
Name:
Title:
By:________________________________
By _______________________________
Name:
Title:
For themselves and as Representatives
of the other Underwriters named
herein.
Accepted:
XXXX-XXXXXX AUTOMOTIVE, INC.
By _________________________________
Name:
Title:
ANNEX C
XXXX-XXXXXX AUTOMOTIVE, INC.
(A DELAWARE CORPORATION)
[TITLE OF SECURITIES]
DELAYED DELIVERY CONTRACT
, 19
XXXX-XXXXXX AUTOMOTIVE, INC.
000 Xxxxx Xxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention:
Dear Sirs:
The undersigned hereby agrees to purchase from Xxxx-Xxxxxx Automotive, Inc.
(the "Company"), and the Company agrees to sell to the undersigned on ______ 19
("Delivery Date"),__________ principal amount of the Company's [insert title of
security] (the "Securities"), offered by the Company's Prospectus dated _______,
19 , as supplemented by its Prospectus Supplement dated _________, 19 , receipt
of which is hereby acknowledged at a purchase price of [ ]% of the principal
amount thereof, plus accrued interest from ________, 19 , to the Delivery Date,
and on the further terms and conditions set forth in this contract.
Payment for the Securities which the undersigned has agreed to purchase
on the Delivery Date shall be made to the Company or its order by certified or
official bank check in New York Clearing House funds at the office of, on the
Delivery Date, upon delivery to the undersigned of the Securities to be
purchased by the undersigned in definitive form and in such denominations and
registered in such names as the undersigned may designate by written or
telegraphic communication addressed to the Company not less than three full
business days prior to the Delivery Date.
The obligation of the undersigned to take delivery of and make payment
for Securities on the Delivery Date shall be subject only to the conditions that
(1) the purchase of Securities to be made by the undersigned shall not on the
Delivery Date be prohibited under the laws of the jurisdiction to which the
undersigned is subject and (2) the Company, on or before , 19 , shall have sold
to the Underwriters of the Securities (the "Underwriters") such principal amount
of the Securities as is to be sold to them pursuant to the Terms Agreement dated
, 19 between the Company and the Underwriters. The obligation of the undersigned
to take delivery of and make payment for Securities shall not be affected by the
failure of any purchaser to take delivery of and make payments for Securities
pursuant to other contracts similar to this contract. The undersigned represents
and warrants to you that its investment in the Securities is not, as of
C-2
the date hereof, prohibited under the laws of any jurisdiction to which the
undersigned is subject and which govern such investment.
Promptly after completion of the sale to the Underwriters, the Company
will mail or deliver to the undersigned at its address set forth below notice to
such effect, accompanied by a copy of the opinion of counsel for the Company
delivered to the Underwriters in connection therewith.
By the execution hereof, the undersigned represents and warrants to the
Company that all necessary corporate action for the due execution and delivery
of this contract and the payment for and purchase of the Securities has been
taken by it and no further authorization or approval of any governmental or
other regulatory authority is required for such execution, delivery, payment or
purchase, and that, upon acceptance by the Company and mailing or delivery of a
copy as provided below, this contract will constitute a valid and binding
agreement of the undersigned in accordance with its terms.
This contract will inure to the benefit of and binding upon the parties
hereto and their respective successors, but will not be assignable by either
party hereto without the written consent of the other.
It is understood that the Company will not accept Delayed Delivery
Contracts for an aggregate principal amount of Securities in excess of $ and
that the acceptance of any Delayed Delivery Contract is in the Company's sole
discretion and, without limiting the foregoing, need not be on a first-come,
first-served basis. If this contract is acceptable to the Company, it is
requested that the Company sign the form of acceptance on a copy hereof and mail
or deliver a signed copy hereof to the undersigned at its address set forth
below. This will become a binding contract between the Company and the
undersigned when such copy is so mailed or delivered.
This Agreement shall be governed by the laws of the State of New York.
Yours very truly,
______________________________________
(NAME OF PURCHASER)
BY _________________________________
(TITLE)
_________________________________
_________________________________
(ADDRESS)
C-3
Accepted as of the date first above written.
Xxxx-Xxxxxx Automotive, Inc.
By ___________________________________
(TITLE)
PURCHASER--PLEASE COMPLETE AT TIME OF SIGNING
The name and telephone number of the Representatives of the Purchaser
with whom details of delivery on the Delivery Date may be discussed are as
follows: (Please print.)
TELEPHONE NO.
(INCLUDING
NAME...................................AREA CODE)
_____ ___________
