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United Rentals, Inc.
(A Delaware Corporation)
1,300,000 Shares of Common Stock
INTERNATIONAL PURCHASE AGREEMENT
Dated: _________, 1998
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TABLE OF CONTENTS PAGE
SECTION 1. Representations and Warranties...................................................4
(a) Representations and Warranties by the Company.................................4
(i) Compliance with Registration Requirements.............................4
(ii) Independent Accountants................................................5
(iii) Financial Statements...................................................5
(iv) No Manipulation of Market Prices.......................................6
(v) No Material Adverse Change in Business.................................6
(vi) Good Standing of the Company...........................................6
(vii) Good Standing of Subsidiaries..........................................6
(viii) Capitalization......................................................7
(ix) Authorization of Agreement.............................................7
(x) Authorization and Description of Securities............................7
(xi) Absence of Defaults and Conflicts......................................8
(xii) Absence of Labor Dispute...............................................8
(xiii) Absence of Proceedings..........................................9
(xv) Accuracy of Exhibits...................................................9
(xvi) Possession of Intellectual Property....................................9
(xvii) Absence of Further Requirements.......................................10
(xviii)Possession of Licenses and Permits....................................10
(xix) Title to Property.....................................................10
(xx) Investment Company Act................................................11
(xxi) Environmental Laws....................................................11
(b) Officer's Certificates.......................................................13
SECTION 2. Sale and Delivery to International Managers; Closing.........................13
(a) Initial Securities...........................................................13
(b) Option Securities............................................................13
(c) Payment......................................................................14
(d) Denominations; Registration..................................................15
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SECTION 3. Covenants of the Company......................................................15
(a) Compliance with Securities Regulations and Commission Requests...............15
(b) Filing of Amendments.........................................................16
(c) Delivery of Registration Statements..........................................16
(d) Delivery of Prospectuses.....................................................16
(e) Continued Compliance with Securities Laws....................................16
(f) Blue Sky Qualifications......................................................17
(g) Rule 158.....................................................................17
(h) Use of Proceeds..............................................................17
(i) Listing.....................................................................18
(j) Restriction on Sale of Securities...........................................18
(k) Reporting Requirements.......................................................19
(l) Compliance with Rule 463.....................................................19
SECTION 4. Payment of Expenses..........................................................19
(a) Expenses.....................................................................19
(b) Termination of Agreement.....................................................20
SECTION 5. Conditions of International Managers' Obligations...............................20
(a) Effectiveness of Registration Statement......................................20
(b) Opinions of Counsel for Company..............................................20
(c) Opinion of Counsel for International Managers................................21
(d) Officers' Certificate........................................................21
(e) Accountant's Comfort Letters.................................................22
(f) Bring-down Comfort Letter....................................................22
(g) Approval of Listing..........................................................22
(i) Lock-up Agreements...........................................................22
(j) Purchase of Initial U.S. Securities..........................................22
(k) Conditions to Purchase of International Option Securities....................23
(i) Officers' Certificate.................................................23
(ii) Opinions of Counsel for Company.......................................23
(iii) Opinion of Counsel for International Managers.........................23
(iv) Bring-down Comfort Letters............................................23
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(l) Additional Documents.........................................................24
(m) Termination of Agreement.....................................................24
SECTION 6. Indemnification.................................................................24
(a) Indemnification of International Managers....................................24
(b) Indemnification of Company, Directors and Officers...........................26
(c) Actions against Parties; Notification........................................26
(d) Settlement without Consent if Failure to Reimburse...........................27
SECTION 7. Contribution....................................................................28
SECTION 8. Representations, Warranties and Agreements to Survive Delivery..................29
SECTION 9. Termination of Agreement........................................................29
(a) Termination; General.........................................................29
(b) Liabilities..................................................................30
SECTION 10. Default by One or More of the International Managers...........................30
SECTION 11. Notices........................................................................31
SECTION 12. Parties........................................................................31
SECTION 13. GOVERNING LAW AND TIME.........................................................32
SECTION 14. Effect of Headings.............................................................32
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SCHEDULES
Schedule A.....................................................................Sch A-1
Schedule B.....................................................................Sch B-1
Schedule C.....................................................................Sch C-1
EXHIBITS
Exhibit A-1 - Form of Opinion of Company's Counsel ...............................A-1
Exhibit A-2 - Form of Opinion of Company's Counsel................................A-2
Exhibit B - Form of Lock-up Letter.............................................B-1
ANNEX
Annex A - Form of Accountants' Comfort Letter
Pursuant to Section 5(e) ....................................................Annex A-1
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United Rentals, Inc.
(a Delaware corporation)
1,300,000 Shares of Common Stock
(Par Value $.01 Per Share)
INTERNATIONAL PURCHASE AGREEMENT
__________, 1998
XXXXXXX XXXXX INTERNATIONAL
Xxxxxx Xxxxxxxx & Co. Limited
Xxxxxxxxx, Xxxxxx & Xxxxxxxx International
Xxxxx Xxxxxx Inc.
as International Managers
c/o Merrill Xxxxx International
Ropemaker Place
00 Xxxxxxxxx Xxxxxx
Xxxxxx XX0X 0XX
Xxxxxxx
Ladies and Gentlemen:
United Rentals, Inc., a Delaware corporation (the "Company"), confirms
its agreement with Xxxxxxx Xxxxx International ("Xxxxxxx Xxxxx"), Xxxxxx
Xxxxxxxx & Co. Limited, Xxxxxxxxx, Lufkin & Xxxxxxxx International and Xxxxx
Xxxxxx Inc. (collectively, the "International Manag ers", which term shall also
include any underwriter substituted as hereinafter provided in Section 10
hereof), with respect to the issue and sale by the Company and the purchase by
the International Managers, acting severally and not jointly, of the respective
numbers of shares of
Common Stock, par value $.01 per share, of the Company ("Common Stock") set
forth in Schedule A hereto, and with respect to the grant by the Company to the
International Managers, acting severally and not jointly, of the option
described in Section 2(b) hereof to purchase all or any part of 195,000
additional shares of Common Stock to cover over-allotments, if any. The
aforesaid 1,300,000 shares of Common Stock (the "Initial International
Securities") to be purchased by the International Managers and all or any part
of the 195,000 shares of Common Stock subject to the option described in Section
2(b) hereof (the "International Option Securi ties") are hereinafter called,
collectively, the "International Securities".
It is understood that the Company is concurrently entering into an
agreement dated the date hereof (the "U.S. Purchase Agreement") providing for
the offering by the Company of an aggregate of 5,200,000 shares of Common Stock
(the "Initial U.S. Securities") through arrange ments with Xxxxxxx Lynch,
Pierce, Xxxxxx & Xxxxx Incorporated, Deutsche Xxxxxx Xxxxxxxx Inc., Xxxxxxxxx,
Xxxxxx & Xxxxxxxx Securities Corporation and Xxxxx Xxxxxx Inc. in the United
States and Canada (the "U.S. Underwriters") and the grant by the Company to the
U.S. Underwriters, acting severally and not jointly, of an option to purchase
all or any part of the 780,000 additional shares of Common Stock solely to cover
over-allotments, if any (the "U.S. Option Securities" and, together with the
International Option Securities, the "Option Securities"). The Initial U.S.
Securities and the U.S. Option Securities are hereinafter called the "U.S.
Securities". It is understood that the Company is not obligated to sell and the
International Managers are not obligated to purchase, any Initial International
Securities unless all of the Initial U.S. Securities are contemporaneously
purchased by the U.S. Underwriters.
The International Managers and the U.S. Underwriters are hereinafter
collectively called the "Underwriters", the Initial International Securities and
the Initial U.S. Securities are hereinaf ter collectively called the "Initial
Securities". The International Securities, and the U.S. Securities are
hereinafter collectively called the "Securities".
The Underwriters will concurrently enter into an Intersyndicate
Agreement of even date herewith (the "Intersyndicate Agreement") providing for
the coordination of certain transactions among the Underwriters under the
direction of Xxxxxxx Xxxxx & Co., Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated (in such capacity, the "Global Coordinator").
The Company understands that the International Managers propose to make
a public offering of the International Securities as soon as the International
Managers deem advisable after this Agreement has been executed and delivered.
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The Company has filed with the Securities and Exchange Commission (the
"Commis sion") a Registration Statement on Form S-1 (No. 333-_____) covering the
registration of the Securities under the Securities Act of 1933, as amended (the
"1933 Act"), including the related preliminary prospectus or prospectuses.
Promptly after execution and delivery of this Agree ment, the Company will
either (i) prepare and file a prospectus in accordance with the provisions of
Rule 430A ("Rule 430A") of the rules and regulations of the Commission under the
1933 Act (the "1933 Act Regulations") and paragraph (b) of Rule 424 ("Rule
424(b)") of the 1933 Act Regulations or (ii) if the Company has elected to rely
upon Rule 434 ("Rule 434") of the 1933 Act Regulations, prepare and file a term
sheet (a "Term Sheet") in accordance with the provi sions of Rule 434 and Rule
424(b). Two forms of prospectus are to be used in connection with the offering
and sale of the Securities: one relating to the International Securities (the
"Form of International Prospectus") and one relating to the U.S. Securities (the
"Form of U.S. Prospec tus"). The Form of International Prospectus is identical
to the Form of U.S. Prospectus, except for the front cover and back cover pages
and the information under the caption "Underwriting." The information, if any,
included in any such prospectus or in any such Term Sheet, as the case may be,
that was omitted from such registration statement at the time it became
effective but that is deemed to be part of such registration statement at the
time it became effective (a) pursuant to paragraph (b) of Rule 430A is referred
to as "Rule 430A Information" or (b) pursuant to paragraph (d) of Rule 434 is
referred to as "Rule 434 Information." Each Form of International Prospectus and
Form of U.S. Prospectus used before such registration statement became
effective, and any prospectus that omitted, if applicable, the Rule 430A
Information or the Rule 434 Information, that was used after such effectiveness
and prior to the execution and delivery of this Agreement, is herein called a
"preliminary prospectus." Such registration statement, including the exhibits
thereto and schedules thereto at the time it became or will become effective and
including the Rule 430A Information and the Rule 434 Information, as applicable,
is herein called the "Registration Statement." Any registration statement filed
pursuant to Rule 462(b) of the 1933 Act Regulations is herein referred to as the
"Rule 462(b) Registration Statement," and after such filing the term
"Registration Statement" shall include the Rule 462(b) Registration Statement.
The final Form of International Prospectus and the final Form of U.S. Prospectus
in the forms first furnished to the Underwriters for use in connection with the
offering of the Securities are herein called the "International Prospectus" and
the "U.S. Prospectus," respectively, and collectively, the "Prospectuses." If
Rule 434 is relied on, the terms "Interna tional Prospectus" and "U.S.
Prospectus" shall refer to the preliminary International Prospectus dated
February 17, 1998 and preliminary U.S. Prospectus dated February 17, 1998,
respectively, each together with the applicable Term Sheet and all references in
this Agreement to the date of such Prospectuses shall mean the date of the
applicable Term Sheet. For purposes of this Agreement, all references to the
Registration Statement, any preliminary prospectus, the International
Prospectus, the U.S. Prospectus or any Term Sheet or any amendment or supple-
3
ment to any of the foregoing shall be deemed to include the copy filed with the
Commission pursuant to its Electronic Data Gathering, Analysis and Retrieval
system ("XXXXX").
SECTION 1. Representations and Warranties.
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(a) Representations and Warranties by the Company. The Company
represents and warrants to each International Manager as of the date hereof (and
agrees that each such representation and warranty will be deemed to be made by
the Company as of the Closing Time referred to in Section 2(c) hereof, and as of
each Date of Delivery (if any) referred to in Section 2(b) hereof) and agrees
with each International Manager, as follows:
(i) Compliance with Registration Requirements. Each of the
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Registration Statement and any Rule 462(b) Registration Statement has
become effective or will become effective under the 1933 Act and no stop
order suspending the effectiveness of the Registration Statement or any
Rule 462(b) Registration Statement has been issued under the 1933 Act
and no proceedings for that purpose have been instituted or are pending
or, to the knowledge of the Company, are contemplated by the Commission,
and any request on the part of the Commission for additional information
has been complied with.
At the respective times the Registration Statement, any Rule
462(b) Registration Statement and any post-effective amendments thereto
either became effective or will become effective and at the Closing Time
(and, if any International Option Securities are purchased, at the Date
of Delivery), the Registration Statement, the Rule 462(b) Registra tion
Statement and any amendments and supplements thereto complied and will
comply in all material respects with the requirements of the 1933 Act
and the 1933 Act Regula tions and did not and will not contain an untrue
statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein not
misleading, at the time the Prospectuses or any amendments or
supplements thereto were issued and at the Closing Time (and, if any
International Option Securities are purchased, at the Date of Delivery),
included or will include an untrue statement of a material fact or
omitted or will omit to state a material fact necessary in order to make
the statements therein, in the light of the circumstances under which
they were made, not misleading. If Rule 434 is used, the Company will
comply with the requirements of Rule 434 and the Prospectuses shall not
be "materially different", as such term is used in Rule 434, from the
prospectuses included in the Registration Statement at the time it
became effective. The representations and warranties in this subsection
shall not apply to
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statements in or omissions from the Registration Statement or the
International Prospec tus made in reliance upon and in conformity with
information furnished to the Company in writing by any International
Manager expressly for use in the Registration Statement or the
International Prospectus.
Each preliminary prospectus and the prospectuses filed as part of
the Registration Statement as originally filed or as part of any
amendment thereto, or filed pursuant to Rule 424 under the 1933 Act,
complied when so filed in all material respects with the 1933 Act
Regulations and each preliminary prospectus and the Prospectuses
delivered to the Underwriters for use in connection with this offering
was identical to the electroni cally transmitted copies thereof filed
with the Commission pursuant to XXXXX, except to the extent permitted by
Regulation S-T.
(ii) Independent Accountants. The accountants who certified the
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financial statements and supporting schedules of the Company and its
subsidiaries included in the Registration Statement are independent
public accountants as required by the 1933 Act and the 1933 Act
Regulations.
(iii) Financial Statements. Each of the historical financial
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statements included in the Registration Statement and Prospectus,
together with related schedules and Notes, present fairly (on a
consolidated basis where so indicated) the financial condition of the
entity or entities to which such financial statement purports to relate
(the "Reported Entity") at the date(s) indicated and the statement of
operations (or income or earnings as indicated in the applicable
financial statement) and cash flows and (in the case of a Reported
Entity for which a statement of stockholders' equity is included)
stockholders' equity (and partners' capital if so indicated in the
applicable financial statement) of the Reported Entity for the period(s)
specified; said financial statements have been prepared in conformity
with generally accepted accounting principles ("GAAP") applied on a
consistent basis throughout the periods involved (except as otherwise
indicated in such financial statements). Any supporting schedules
included in the Registration Statement present fairly in accordance with
GAAP the information required to be stated therein. The selected
historical financial data and the summary historical financial
information included in the Prospectuses present fairly the information
shown therein and, in the case of historical financial data or
information of the Company, have been compiled on a basis consistent
with that of the audited financial statements included in the
Registration Statement. The pro forma financial statements and the
related notes thereto included in the Registration Statement and the
Prospectuses present fairly the information shown therein, have been
prepared in accordance with the Commission's rules and guidelines
5
with respect to pro forma financial statements and have been properly
compiled on the bases described therein, and the assumptions used in the
preparation thereof are reason able and the adjustments used therein are
appropriate to give effect to the transactions and circumstances
referred to therein.
(vi) No Manipulation of Market Prices. The Company has not
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taken or caused to be taken and will not take or cause to be taken,
either directly or indirectly, any action designed to cause or result
in, or which action constitutes or which might reasonably be expected to
constitute, the stabilization or manipulation of the market price of the
Common Stock, including but not limited to those actions prohibited by
Section 9(a) of the 1934 Act, the 1934 Act Regulations and Regulation M
promulgated by the Commis sion.
(v) No Material Adverse Change in Business. Since the respective
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dates as of which information is given in the Registration Statement and
the Prospectuses, except as otherwise stated therein, (A) there has been
no material adverse change in the condition, financial or otherwise, or
in the earnings, business affairs or, to the best knowledge of the
Company, business prospects of the Company and its subsidiaries
considered as one enterprise, whether or not arising in the ordinary
course of business (a "Material Adverse Effect"), (B) there have been no
transactions entered into by the Company or any of its subsidiaries,
other than those in the ordinary course of business, which are material
with respect to the Company and its subsidiaries considered as one
enterprise, and (C) there has been no dividend or distribution of any
kind declared, paid or made by the Company on any class of its capital
stock.
(vi) Good Standing of the Company. The Company has been duly
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organized 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 Prospectuses and to enter into and perform
its obligations under this Agreement; and the Company is duly qualified
as a foreign corporation to transact business and is in good standing in
each other jurisdiction in which such qualification is required, whether
by reason of the ownership or leasing of property or the conduct of
business, except where the failure so to qualify or to be in good
standing would not result in a Material Adverse Effect.
(vii) Good Standing of Subsidiaries. Each subsidiary of the
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Company has been duly organized and is validly existing as a corporation
in good standing under the laws of the jurisdiction of its
incorporation, has corporate power and authority to own, lease and
6
operate its properties and to conduct its business as described in the
Prospectuses and is duly qualified as a foreign corporation to transact
business and is in good standing in each jurisdiction in which such
qualification is required, whether by reason of the ownership or leasing
of property or the conduct of business, except where the failure so to
qualify or to be in good standing would not result in a Material Adverse
Effect; except as otherwise disclosed in the Registration Statement, all
of the issued and outstanding capital stock of each such subsidiary has
been duly authorized and validly issued, is fully paid and
non-assessable and is owned by the Company, directly or through
subsidiaries, free and clear of any security interest, mortgage, pledge,
lien, encumbrance, claim or equity (except for any security interest or
pledge contemplated by the Credit Agreement filed as Exhibit 10(a) to
the Registration Statement); none of the outstanding shares of capital
stock of any subsidiary was issued in violation of the preemptive or
similar rights of any security holder of such subsidiary. The only
subsidiaries of the Company (other than inactive subsidiaries) are the
subsidiaries listed on Exhibit 21 to the Registration State ment.
(viii) Capitalization. The authorized, issued and outstanding
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capital stock of the Company is as set forth in the Prospectuses under
"Description of Capital Stock-General" (except for subsequent issuances,
if any, pursuant to this Agreement, pursuant to reserva tions,
agreements or employee benefit plans referred to in the Prospectuses or
pursuant to the exercise of convertible securities, warrants or options
referred to in the Prospectuses). The shares of issued and outstanding
capital stock of the Company have been duly authorized and validly
issued and are fully paid and non-assessable; none of the outstand ing
shares of capital stock of the Company was issued in violation of the
preemptive or other similar rights of any security holder of the
Company. All sales of the Company's capital stock prior to the date
hereof were either (1) made pursuant to a registration statement filed
by the Company with the Commission under the 1933 Act or (2) at all
relevant times exempt from the registration requirements of the 1933 Act
and in case (1) and (2) duly registered with or the subject of an
available exemption from the registration requirements of the applicable
state securities or blue sky laws.
(ix) Authorization of Agreement. This Agreement and the U.S.
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Purchase Agreement have been duly authorized, executed and delivered by
the Company.
(x) Authorization and Description of Securities. The Securities
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to be pur chased by the International Managers and the U.S. Underwriters
from the Company have been duly authorized for issuance and sale to the
International Managers pursuant to this Agreement and the U.S.
Underwriters pursuant to the U.S. Purchase Agreement, respec-
7
tively, and, when issued and delivered by the Company pursuant to this
Agreement and the U.S. Purchase Agreement, respectively, against payment
of the consideration set forth herein and the U.S. Purchase Agreement,
respectively, will be validly issued, fully paid and non-assessable; the
Common Stock conforms to all statements relating thereto contained in
the Prospectuses and such description conforms to the rights set forth
in the instruments defining the same; no holder of the Securities will
be subject to personal liability by reason of being such a holder; and
the issuance of the Securities is not subject to the preemptive or other
similar rights of any security holder of the Company.
(xi) Absence of Defaults and Conflicts. Neither the Company nor
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any of its subsidiaries is in violation of its charter or by-laws or in
default in the performance or observance of any obligation, agreement,
covenant or condition contained in any contract, indenture, mortgage,
deed of trust, loan or credit agreement, note, lease or other agreement
or instrument to which the Company or any of its subsidiaries is a party
or by which it or any of them may be bound, or to which any of the
property or assets of the Company or any subsidiary is subject
(collectively, "Agreements and Instruments") except for such defaults
that would not result in a Material Adverse Effect; and the execution,
delivery and performance of this Agreement and the U.S. Purchase
Agreement and the consumma tion of the transactions contemplated in this
Agreement, the U.S. Purchase Agreement and in the Registration Statement
(including the issuance and sale of the Securities and the use of the
proceeds from the sale of the Securities as described in the
Prospectuses under the caption "Use of Proceeds") and compliance by the
Company with its obliga tions under this Agreement and the U.S. Purchase
Agreement have been duly authorized by all necessary corporate action
and do not and will not, whether with or without the giving of notice or
passage of time or both, conflict with or constitute a breach of, or
default or Repayment Event (as defined below) under, or result in the
creation or imposition of any lien, charge or encumbrance upon any
property or assets of the Company or any subsidiary pursuant to, the
Agreements and Instruments (except for such conflicts, breaches or
defaults or liens, charges or encumbrances that would not result in a
Material Adverse Effect), nor will such action result in any violation
of the provisions of the charter or by-laws of the Company or any
subsidiary or any applicable law, statute, rule, regulation, judgment,
order, writ or decree of any government, government instru mentality or
court, domestic or foreign, having jurisdiction over the Company or any
subsidiary or any of their assets, properties or operations. As used
herein, a "Repayment Event" means any event or condition which gives the
holder of any note, debenture or other evidence of indebtedness (or any
person acting on such holder's behalf) the right to require the
repurchase, redemption or repayment of all or a portion of such
indebtedness by the Company or any subsidiary.
8
(xii) Absence of Labor Dispute. 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 employ ees 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.
(xiii) Absence of Proceedings. There is no action, suit,
-----------------------
proceeding, inquiry or investigation before or brought by any court or
governmental agency or body, domestic or foreign, now pending, or, to
the knowledge of the Company, threatened, against or affecting the
Company or any subsidiary, which is required to be disclosed in the
Registration Statement (other than as disclosed therein), or which might
reasonably be expected to result in a Material Adverse Effect, or which
might reasonably be expected to materially and adversely affect the
consummation of the transactions contemplated in this Agreement and the
U.S. Purchase Agreement or the performance by the Company of its
obligations hereunder or thereunder; the aggregate of all pending legal
or governmental proceedings to which the Company or any subsidiary is a
party or of which any of their respective property or assets is the
subject which are not described in the Registration Statement, including
ordinary routine litigation incidental to the business, could not
reasonably be expected to result in a Material Adverse Effect.
(xiv) Accuracy of Representations and Warranties. To the
------------------------------------------
knowledge of the Company, the representations and warranties made by
each of the subsidiaries (as defined in the Registration Statement and
the Prospectuses) and the selling stockholders in the respective
agreements pursuant to which the Company acquired the subsidiaries did
not as of the respective dates thereof contain any inaccuracies that
might, singly or in the aggregate, reasonably be expected to have a
Material Adverse Effect.
(xv) Accuracy of Exhibits. There are no contracts or documents
--------------------
which are required to be described in the Registration Statement or the
Prospectuses or to be filed as exhibits thereto which have not been so
described and filed as required.
(xvi) Possession of Intellectual Property. The Company and its
-----------------------------------
subsidiaries own or possess, or can acquire on reasonable terms,
adequate patents, patent rights, licenses, inventions, copyrights,
know-how (including trade secrets and other unpatented and/or
unpatentable proprietary or confidential information, systems or
procedures), trademarks, service marks, trade names or other
intellectual property (collectively, "Intellectual Property") necessary
to carry on the business now operated by them, and
9
neither the Company nor any of its subsidiaries has received any notice
or is otherwise aware of any infringement of or conflict with asserted
rights of others with respect to any Intellectual Property or of any
facts or circumstances which would render any Intellectual Property
invalid or inadequate to protect the interest of the Company or any of
its subsidiaries therein, and which infringement or conflict (if the
subject of any unfavorable decision, ruling or finding) or invalidity or
inadequacy, singly or in the aggregate, would result in a Material
Adverse Effect.
(xvii) Absence of Further Requirements. No filing with, or
-------------------------------
authorization, approval, consent, license, order, registration,
qualification or decree of, any court or governmental authority or
agency is necessary or required for the performance by the Company of
its obligations hereunder, in connection with the offering, issuance or
sale of the Securities under this Agreement and the U.S. Purchase
Agreement or the consumma tion of the transactions contemplated by this
Agreement and the U.S. Purchase Agree ment, except such as have been
already obtained or as may be required under the 1933 Act or the 1933
Act Regulations, the 1934 Act or the rules and regulations of the
Commission under the 1934 Act (the "1934 Act Regulations") and foreign
or state securities or blue sky laws.
(xviii) Possession of Licenses and Permits. The Company and its
----------------------------------
subsidiaries possess such permits, licenses, approvals, consents and
other authorizations (collectively, "Governmental Licenses") issued by
the appropriate federal, state, local or foreign regulatory agencies or
bodies necessary to conduct the business now operated by them except
where the failure to so possess such Government Licenses would not,
singly or in the aggregate, have a Material Adverse Effect; the Company
and its subsidiaries are in compliance with the terms and conditions of
all such Governmental Licenses, except where the failure so to comply
would not, singly or in the aggregate, have a Material Adverse Effect;
all of the Governmental Licenses are valid and in full force and effect,
except when the invalidity of such Governmental Licenses or the failure
of such Govern mental Licenses to be in full force and effect would not
have, singly or in the aggregate, a Material Adverse Effect; and neither
the Company nor any of its subsidiaries has received any notice of
proceedings relating to the revocation or modification of any such
Govern mental Licenses which, singly or in the aggregate, if the subject
of an unfavorable decision, ruling or finding, would result in a
Material Adverse Effect.
(xix) Title to Property. The Company and its subsidiaries
-----------------
have good and marketable title to all real property described in the
Prospectus as owned by the Company and its subsidiaries and good title
to all other properties described in the Prospectus as
10
owned by them, in each case, free and clear of all mortgages, pledges,
liens, security interests, claims, restrictions or encumbrances of any
kind except such as (a) are de scribed in the Prospectuses or are not
required to be described therein pursuant to the 1933 Act or the 1933
Act Regulations or (b) do not, singly or in the aggregate, materially
interfere with the use made and proposed to be made of such property by
the Company or any of its subsidiaries; and all of the leases and
subleases material to the business of the Company and its subsidiaries,
considered as one enterprise, and under which the Com pany or any of its
subsidiaries holds properties described in the Prospectuses, are in full
force and effect, and neither the Company nor any subsidiary has any
notice of any 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 the Company or such subsidiary to the continued possession
of the leased or subleased premises under any such lease or sublease,
which claim, if upheld, would result in a Material Adverse Effect.
(xx) Investment Company Act. The Company is not, and upon the
----------------------
issuance and sale of the Securities as herein contemplated and the
application of the net proceeds therefrom as described in the
Prospectuses will not be, an "investment company" or an entity
"controlled" by an "investment company" as such terms are defined in the
Invest ment Company Act of 1940, as amended (the "1940 Act").
(xxi) Environmental Laws. Except as described in the
------------------
Registration Statement or except as would not, singly or in the
aggregate, result in a Material Adverse Effect or except as would not be
required to be described in the Registration Statement or the
Prospectuses pursuant to the 1933 Act or the 1933 Act Regulations: (A)
neither the Company nor any of its subsidiaries is in violation of any
federal, state, local or foreign statute, law, rule, regulation,
ordinance, code, policy or rule of common law or any judicial or
administrative interpretation thereof, including any judicial or
administrative order, consent, decree or judgment, relating to pollution
or protection of human health, the environment (including, without
limitation, ambient air, surface water, groundwater, land surface or
subsurface strata) or wildlife, including, without limitation, laws and
regulations relating to the release or threatened release of chemicals,
pollutants, contami nants, 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) neither the Company
nor any of its subsidiaries is lacking any permits, authorizations and
approvals required under any applicable Environmental Laws or are in
violation of the requirements of such Environmental Laws, (C) there are
11
no pending or to the best knowledge of the Company, threatened
administrative, xxxxxx xxxx or judicial actions, suits, demands, demand
letters, claims, liens, notices of noncom pliance or violation,
investigation or proceedings relating to any Environmental Law against
the Company or any of its subsidiaries and (D) to the knowledge of the
Company there are no events or circumstances 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 subsidiaries
relating to Hazardous Materials or any Environmental Laws.
(xxii) Statistical and Market Data. Nothing has come to the
---------------------------
attention of the Company that has caused the Company to believe that the
statistical and market-related data included in the Prospectus are not
based on or derived from sources that are reliable and accurate in all
material respects.
(xxiii) Taxes. The Company and each of its subsidiaries have
-----
filed all necessary federal, state, local and foreign income, payroll,
franchise and other tax returns (after giving effect to extensions) and
have paid all taxes shown as due thereon or with respect to the Company
or any of its properties (except where the failure to so file or pay
would not singly or in the aggregate, have a Material Adverse Effect),
and there is no tax deficiency that has been, or to the knowledge of the
Company is likely to be, asserted against the Company, any of its
subsidiaries or any of their properties or assets that would result in a
Material Adverse Effect, except for taxes that are being contested in
good faith by appropriate proceedings and with respect to which the
Company has established adequate reserves in accordance with GAAP.
(xxiv) Insurance. Neither the Company nor any subsidiary has
---------
received notice from any insurer providing insurance coverage for the
Company and its subsidiaries or agent of such insurer that capital
improvements or other expenditures will have to be made in order to
continue present insurance coverage, except such as could not reason
ably be expected, singularly or in the aggregate, to have a Material
Adverse Effect.
(xxv) Maintenance of Sufficient Internal Controls. The Company
-------------------------------------------
and its subsidiar ies maintain a system of internal accounting controls
sufficient to provide reasonable assurances that (i) transactions are
executed in accordance with management's general or specific
authorization; (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally
accepted accounting principles and to maintain accountability for
assets; (iii) access to assets is permitted only in accordance with
management's general or specific authorization; and (iv) the
recorded accountability for assets is compared with existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences.
(xxvi) Registration Rights. There are no persons with
-------------------
registration rights or other similar rights to have any securities
registered pursuant to the Registration Statement.
(xxvii) Fees. Other than pursuant to this Agreement, the U.S.
----
Purchase Agreement or as described in the Registration Statement and the
Prospectuses, there are no contracts , agreements or understandings
between either the Company or its subsidiaries and any person that give
rise to a valid claim against the Company, any of its subsidiaries or
any of the Underwriters for a brokerage commission, finder's fee or
other like payment relating to the transactions contemplated hereby.
(b) Officer's Certificates. Any certificate signed by any officer
of the Company or any of its subsidiaries delivered to the Global Coordinator,
the International Managers or to counsel for the International Managers shall be
deemed a representation and warranty by the Company to each International
Manager as to the matters covered thereby.
SECTION 2. Sale and Delivery to International Managers; Closing.
----------------------------------------------------
(a) Initial Securities. On the basis of the representations and
warranties herein contained and subject to the terms and conditions herein set
forth, the Company agrees to sell to each International Manager, severally and
not jointly, and each International Manager, severally and not jointly, agrees
to purchase from the Company, at the price per share set forth in Schedule B,
the number of Initial International Securities set forth in Schedule A opposite
the name of such International Manager, plus any additional number of Initial
International Securities which such International Manager may become obligated
to purchase pursuant to the provisions of Section 10 hereof.
(b) Option Securities. In addition, on the basis of the
representations and warranties herein contained and subject to the terms and
conditions herein set forth, the Com pany hereby grants an option to the
International Managers, severally and not jointly, to purchase up to an
additional 195,000 shares of Common Stock at the price per share set forth in
Schedule B, less an amount per share equal to any dividends or distributions
declared by the Company and payable on the Initial International Securities but
not payable on the International Option Securities. The option hereby granted
will expire 30 days after the date hereof and may be exercised in whole or in
part from time to time only for the purpose of covering over-allotments
12
which may be made in connection with the offering and distribution of the
Initial International Securities upon notice by the Global Coordinator to the
Company setting forth the number of International Option Securities as to which
the several International Managers are then exercising the option and the time
and date of payment and delivery for such International Option Securi ties. Any
such time and date of delivery for the International Option Securities (a "Date
of Delivery") shall be determined by the Global Coordinator, but shall not be
earlier than three or later than seven full business days after the exercise of
said option or at such earlier time as may be agreed upon by the Global
Coordinator and the Company, nor in any event prior to the Closing Time, as
hereinafter defined. If the option is exercised as to all or any portion of the
International Option Securities, each of the International Managers, acting
severally and not jointly, will purchase that proportion of the total number of
International Option Securities then being purchased which the number of Initial
International Securities set forth in Schedule A opposite the name of such
International Manager bears to the total number of Initial International
Securities, subject in each case to such adjustments as the Global Coordinator
in its discretion shall make to eliminate any sales or purchases of fractional
shares.
(c) Payment. Payment of the purchase price for, and delivery of
certificates for, the Initial Securities shall be made at the offices of
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP, 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000, or at such other place as shall be agreed upon by the Global Coordinator
and the Company, at 9:00 A.M. (Eastern time) on the third (fourth, if the
pricing occurs after 4:30 P.M. (Eastern time) on any given day business day
after the date hereof (unless postponed in accordance with the provisions of
Section 10), or such other time not later than ten business days after such date
as shall be agreed upon by the Global Coordinator and the Company (such time and
date of payment and delivery being herein called "Closing Time").
In addition, in the event that any or all of the International Option
Securities are pur chased by the International Managers, payment of the purchase
price for, and delivery of certificates for, such International Option
Securities shall be made at the above-mentioned offices, or at such other place
as shall be agreed upon by the Global Coordinator and the Company, on each Date
of Delivery as specified in the notice from the Global Coordinator to the
Company.
Payment shall be made to the Company by wire transfer of immediately
available funds to a bank account designated by the Company, against delivery to
the respective accounts of the International Managers of certificates for the
International Securities to be purchased by them. It is understood that each
International Manager is authorized, for its account, to accept delivery of,
receipt for, and make payment of the purchase price for, the Initial
International Securities and
13
the International Option Securities, if any, which it has agreed to purchase.
Xxxxxxx Xxxxx, individually and not as representative of the International
Managers, may (but shall not be obligated to) make payment of the purchase price
for the Initial International Securities or the International Option Securities,
if any, to be purchased by any International Manager whose funds have not been
received by the Closing Time or the relevant Date of Delivery, as the case may
be, but such payment shall not relieve such International Manager from its
obligations hereunder.
(d) Denominations; Registration. Certificates for the Initial
International Securities and the International Option Securities, if any, shall
be in such denominations and registered in such names as the International
Managers may request in writing at least one full business day before the
Closing Time or the relevant Date of Delivery, as the case may be. The
certificates for the Initial International Securities and the International
Option Securities, if any, will be made available for examination and packaging
by the International Managers in The City of New York not later than 10:00 A.M.
(Eastern time) on the business day prior to the Closing Time or the relevant
Date of Delivery, as the case may be.
SECTION 3. Covenants of the Company. The Company covenants with
------------------------
each International Manager as follows:
(a) Compliance with Securities Regulations and Commission
Requests. The Company, subject to Section 3(b) hereof, will comply with
the requirements of Rule 430A or Rule 434, as applicable, and will
notify the Global Coordinator immediately, and confirm the notice in
writing, (i) when any post-effective amendment to the Registration
Statement shall become effective, or any supplement to the Prospectuses
or any amended Prospectuses shall have been filed, (ii) of the receipt
of any comments from the Commis sion, (iii) of any request by the
Commission for any amendment to the Registration Statement or any
amendment or supplement to the Prospectuses or for additional
information, and (iv) of the issuance by the Commission of any stop
order suspending the effectiveness of the Registration Statement or of
any order preventing or suspending the use of any preliminary
prospectus, or of the suspension of the qualification of the Securities
for offering or sale in any jurisdiction, or of the initiation or
threatening of any proceedings for any of such purposes. The Company
will promptly effect the filings necessary pursuant to Rule 424(b) and
will take such steps as it deems necessary to ascertain promptly whether
the form of prospectus transmitted for filing under Rule 424(b) was
received for filing by the Commission and, in the event that it was not,
it will promptly file such prospectus. The Company will make every
reasonable effort to
14
prevent the issuance of any stop order and, if any stop order is issued,
to obtain the lifting thereof at the earliest possible moment.
(b) Filing of Amendments. The Company will give the Global
Coordi nator notice of its intention to file or prepare any amendment to
the Registration State ment (including any filing under Rule 462(b)),
any Term Sheet or any amendment, supplement or revision to either the
prospectus included in the Registration Statement at the time it became
effective or to the Prospectuses, will furnish the Global Coordinator
with copies of any such documents a reasonable amount of time prior to
such proposed filing or use, as the case may be, and will not file or
use any such document to which the Global Coordinator or counsel for the
International Managers shall object.
(c) Delivery of Registration Statements. The Company has
furnished or will deliver to the International Managers and counsel for
the International Managers, without charge, signed copies of the
Registration Statement as originally filed and of each amendment thereto
(including exhibits filed therewith or incorporated by reference
therein) and signed copies of all consents and certificates of experts,
and will also deliver to the International Managers, without charge, a
conformed copy of the Registration Statement as originally filed and of
each amendment thereto (without exhibits) for each of the International
Managers. The copies of the Registration Statement and each amendment
thereto furnished to the International Managers will be identical to the
electronically transmitted copies thereof filed with the Commission
pursuant to XXXXX, except to the extent permitted by Regulation S-T.
(d) Delivery of Prospectuses. The Company has delivered to
each International Manager, without charge, as many copies of each
preliminary prospectus as such International Manager reasonably
requested, and the Company hereby consents to the use of such copies for
purposes permitted by the 1933 Act. The Company will furnish to each
International Manager, without charge, during the period when the
International Prospectus is required to be delivered under the 1933 Act
or the 1934 Act, such number of copies of the International Prospectus
(as amended or supplemented) as such International Manager may
reasonably request. The International Prospectus and any amendments or
supplements thereto furnished to the International Managers will be
identical to the electronically transmitted copies thereof filed with
the Commission pursuant to XXXXX, except to the extent permitted by
Regulation S-T.
(e) Continued Compliance with Securities Laws. The Company
will comply with the 1933 Act and the 1933 Act Regulations so as to
permit the completion of
15
the distribution of the Securities as contemplated in this Agreement,
the U.S. Purchase Agreement and in the Prospectuses. If at any time when
a prospectus is required by the 1933 Act to be delivered in connection
with sales of the Securities, any event shall occur or condition shall
exist as a result of which it is necessary, in the opinion of counsel
for the International Managers or for the Company, to amend the
Registration Statement or amend or supplement any Prospectus in order
that the Prospectuses will not include any untrue statements of a
material fact or omit to state a material fact necessary in order to
make the statements therein not misleading in the light of the
circumstances existing at the time it is delivered to a purchaser, or if
it shall be necessary, in the opinion of such counsel, at any such time
to amend the Registration Statement or amend or supplement any
Prospectus in order to comply with the requirements of the 1933 Act or
the 1933 Act Regulations, the Company will promptly prepare and file
with the Commission, subject to Section 3(b), such amendment or
supplement as may be necessary to correct such statement or omission or
to make the Registration Statement or the Prospectuses comply with such
requirements, and the Company will furnish to the International Managers
such number of copies of such amendment or supplement as the
International Managers may reasonably request.
(f) Blue Sky Qualifications. The Company will use its best
efforts, in cooperation with the International Managers, to qualify the
Securities for offering and sale under the applicable securities laws of
such states and other jurisdictions (domestic or foreign) as the Global
Coordinator may designate and to maintain such qualifications in effect
for a period of not less than one year from the later of the effective
date of the Registration Statement and any Rule 462(b) Registration
Statement; provided, however, that 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. In each jurisdiction in which the Securities have been so
qualified, the Company will file such statements and reports as may be
required by the laws of such jurisdiction to continue such qualification
in effect for a period of not less than one year from the effective date
of the Registration Statement and any Rule 462(b) Registration
Statement.
(g) Rule 158. The Company will timely file such reports
pursuant to the 1934 Act as are necessary in order to make generally
available to its security holders as soon as practicable an earnings
statement for the purposes of, and to provide the benefits contemplated
by, the last paragraph of Section 11(a) of the 1933 Act.
16
(h) Use of Proceeds. The Company will use the net proceeds
received by it from the sale of the Securities in the manner specified
in the Prospectuses under "Use of Proceeds".
(i) Listing. The Company will use its best efforts to
effect the listing of the Securities on the New York Stock Exchange.
(j) Restriction on Sale of Securities. During a period of
180 days from the date of the Prospectuses, the Company will not,
without the prior written consent of the Global Coordinator on behalf of
the Underwriters, (i) directly or indirectly, offer, pledge, sell,
contract to sell, sell any option or contract to purchase, purchase any
option or contract to sell, grant any option, right or warrant for the
sale of or otherwise dispose of or transfer any share of Common Stock or
any securities convertible into or exchange able or exercisable for
Common Stock, whether now owned or hereafter acquired or with respect to
which the power of disposition is acquired, or file any registration
statement under the 1933 Act with respect to any of the foregoing (other
than as contemplated in (E), (F) and (G) below), (ii) enter into any
swap or any other agreement or any transaction that transfers, in whole
or in part, directly or indirectly, the economic consequence of
ownership of the Common Stock, whether any such swap or transaction is
to be settled by delivery of Common Stock or other securities, in cash
or otherwise, or (iii) waive any Stockholder Lock-up Agreement (as such
term is defined in the Registration Statement and the Prospectuses).
Clauses (i) and (ii) of the foregoing sentence shall not limit the
Company's ability (A) to sell the Securities hereunder or under the
International Purchase Agreement, (B) to issue shares of Common Stock
upon the exercise of an option or warrant or the conversion of a
security outstanding on the date hereof and referred to in the
Prospectuses, (C) to grant stock options under the 1997 Stock Option
Plan (as such term is defined in the Registration Statement and the
Prospectuses), (D) to issue shares of Common Stock as consideration for
future acquisitions, provided, however, that the Company may not issue
in excess of 750,000 shares for acquisitions unless the recipients of
such excess shares enter into agreements containing the limitations set
forth in the first sentence of this paragraph with respect to such
additional shares, (E) to file a shelf registration statement pursuant
to Rule 415 under the 1933 Act relating to (a) shares of Common Stock
outstanding as of the date of the Prospectuses and (b) shares of Common
Stock underlying warrants or convertible notes outstanding as of the
date of the Prospec tuses, provided, however, that no sales of Common
Stock may be made pursuant to such registration statement during the
period of 180 days from the date of the Prospectuses, (F) to file a
registration statement under the 1933 Act with respect to shares of
Common Stock or other securities to be issued after the date hereof as
consideration for an acquisi-
17
tion or with respect to the potential resale of shares issued after the
date hereof as consideration for an acquisition, provided, however, that
no sales may be made pursuant to such registration statement except to
the extent permitted by clause (D) hereof, or (G) file a registration
statement under the 1933 Act registering the shares of Common Stock that
may be issued pursuant to options granted or to be granted under the
1997 Stock Option Plan. In addition to the foregoing, the Company will
(i) require any individual who becomes an officer or director of the
Company and purchases shares of Common Stock of the Company subsequent
to the date of the Prospectuses to enter into a Lock-up Agreement in the
form contained in Exhibit B hereto and (ii) in the event any
registration rights are granted by the Company in regard to shares of
Common Stock issuable upon the conversion of any outstanding securities
of the Company (as contemplated in (B) above, and including, but not
limited to, a $300,000 principal amount note issued as consideration for
the acquisition of one of the Initial Acquired Companies), also require
the holders of shares of Common Stock that are the subject of such
registration rights to enter into a Lock-up Agreement in the form of
Exhibit B hereto.
(k) Reporting Requirements. The Company, during the period
when the Prospectuses are required to be delivered under the 1933 Act or
the 1934 Act, will file all documents required to be filed with the
Commission pursuant to the 1934 Act within the time periods required by
the 1934 Act and the rules and regulations of the Commission thereunder.
(l) Compliance with Rule 463. The Company will file with
the Commission such information as may be required pursuant to Rule 463
of the 1933 Act Regulations.
SECTION 4. Payment of Expenses. (a) Expenses. The Company will pay all
expenses incident to the performance of its obligations under this Agreement,
including (i) the preparation, printing and filing of the Registration Statement
(including financial statements and exhibits) as originally filed and of each
amendment thereto, (ii) the preparation, printing and delivery to the
Underwriters of this Agreement, the U.S. Purchase Agreement, the Intersyndicate
Agreement and Agreement Among Managers and such other documents as may be
required in connection with the offering, purchase, sale, issuance or delivery
of the Securities, (iii) the preparation, issuance and delivery of the
certificates for the Securities to the Underwriters, including any stock or
other transfer taxes and any stamp or other duties payable upon the sale,
issuance or delivery of the Securities to the Underwriters and the transfer of
the Securities between the U.S. Underwriters and the International Managers,
(iv) the fees and disbursements of the Company's counsel, accountants and other
advisors, (v) the qualification of the Securities
18
under securities laws in accordance with the provisions of Section 3(f) hereof,
including filing fees and the reasonable fees and disbursements of counsel for
the Underwriters in connection therewith and in connection with the preparation
of the Blue Sky Survey and any supplement thereto, (vi) the printing and
delivery to the Underwriters of copies of each preliminary prospec tus, any Term
Sheets and of the Prospectuses and any amendments or supplements thereto, (vii)
the preparation, printing and delivery to the Underwriters of copies of the Blue
Sky Survey and any supplement thereto, (viii) the fees and expenses of any
transfer agent or registrar for the Securities, (ix) the filing fees incident
to, and the reasonable fees and disbursements of counsel to the Underwriters in
connection with, the review by the National Association of Securities Dealers,
Inc. (the "NASD") of the terms of the sale of the Securities and (x) the fees
and expenses incurred in connection with the listing of the Securities on the
New York Stock Exchange.
(b) Termination of Agreement. If this Agreement is terminated by
the Interna tional Managers in accordance with the provisions of Section 5 or
Section 9(a)(i) hereof, the Company shall reimburse the International Managers
for all of their reasonable out-of-pocket expenses, including the reasonable
fees and disbursements of counsel for the International Managers; provided,
however, that any reimbursement by the Company pursuant to this Section 4(b)
shall be limited to an aggregate of $500,000.
SECTION 5. Conditions of International Managers' Obligations. The
obligations of the several International Managers hereunder are subject to the
accuracy of the representations and warranties of the Company contained in
Section 1 hereof or in certificates of any officer of the Company or any
subsidiary of the Company delivered pursuant to the provisions hereof, to the
performance by the Company of its covenants and other obligations hereunder, and
to the following further conditions:
(a) Effectiveness of Registration Statement. The
Registration Statement, including any Rule 462(b) Registration
Statement, has become effective and at Closing Time no stop order
suspending the effectiveness of the Registration Statement shall have
been issued under the 1933 Act or proceedings therefor initiated or
threatened by the Commission, and any request on the part of the
Commission for additional information shall have been complied with to
the reasonable satisfaction of counsel to the Interna tional Managers.
If the Company has elected to rely on Rule 430A, Prospectuses containing
the Rule 430A Information shall have been filed with the Commission in
accordance with Rule 424(b) (or a post-effective amendment providing
such information shall have been filed and declared effective in
accordance with the requirements of Rule
19
430A) or, if the Company has elected to rely upon Rule 434, a Term Sheet
shall have been filed with the Commission in accordance with Rule
424(b).
(b) Opinions of Counsel for Company. At Closing Time, the
Interna tional Managers shall have received the favorable opinions,
dated as of Closing Time, of Xxxxxxxxxx Xxxxxxxxx Xxxxxx & Xxxxxx LLP
and Weil, Gotshal & Xxxxxx LLP, counsel for the Company, in form and
substance reasonably satisfactory to counsel for the International
Managers, together with signed or reproduced copies of such letters for
each of the other International Managers to the effect set forth in
Exhibits A-1 and A-2, respectively, hereto and to such further effect as
counsel to the International Managers may reasonably request. In giving
such opinions 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 reasonably satisfactory
to counsel to the International Managers. Such counsel may also state
that, insofar as such opinions involve factual matters, they have
relied, to the extent they deem proper, upon certificates of officers of
the Company and its subsidiaries and certificates of public officials.
(c) Opinion of Counsel for International Managers. At
Closing Time, the International Managers shall have received the
favorable opinion, dated as of Closing Time, of Skadden, Arps, Slate,
Xxxxxxx & Xxxx LLP, counsel for the International Managers, together
with signed or reproduced copies of such letter for each of the other
International Managers in form and substance reasonably satisfactory to
the International Managers. 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 the International Managers. Such
counsel may also state that, insofar as such opinion involves factual
matters, they have relied, to the extent they deem proper, upon
certificates of officers of the Company and its subsidiaries and
certificates of public officials.
(d) Officers' Certificate. At Closing Time, there shall
not have been, since the date hereof or since the respective dates as of
which information is given in the Prospectuses, any material adverse
change in the condition, financial or otherwise, 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, and the International Managers shall have
received a certificate of the Chief Executive Officer of the Company and
of the Chief Financial Officer of the Company, dated as of
20
Closing Time, to the effect that (i) there has been no such material
adverse change, (ii) the representations and warranties in Section 1(a)
hereof are true and correct with the same force and effect as though
expressly made at and as of Closing Time, (iii) the Company has complied
in all material respects with all agreements and satisfied all
conditions on its part to be performed or satisfied at or prior to
Closing Time, and (iv) no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that
purpose have been instituted or are pending or, to the best knowledge of
the Company, are contemplated by the Commission.
(e) Accountant's Comfort Letters. At the time of the
execution of this Agreement, the International Managers shall have
received from Ernst & Young LLP, Xxxxxxx, Xxxx & Co., PA, KPMG Peat
Marwick LLP, Xxxxx Xxxxxxxx, LLP, KPMG Peat Marwick (Canada) and
Xxxxxxxxx, Xxxxxxx & Xxxx, P.C. letters dated such date, in form and
substance satisfactory to the International Managers, together with
signed or reproduced copies of such letters for each of the other
International Managers, to the effect set forth in Annex A hereto,
containing statements and information of the type ordinarily included in
accountants' "comfort letters" to underwriters with respect to the
financial statements audited by such accountants and certain financial
information contained in the Registration Statement and the
Prospectuses.
(f) Bring-down Comfort Letter. At Closing Time, the
International Managers shall have received from Ernst & Young LLP,
Xxxxxxx, Xxxx & Co., PA, KPMG Peat Marwick, Xxxxx Xxxxxxxx, LLP, KPMG
Peat Marwick (Canada) and Xxxxxxxxx, Xxxxxxx & Xxxx, P.C. letters, dated
as of Closing Time, to the effect that they reaffirm the statements made
in the letters furnished pursuant to subsection (e) of this Section 5,
except that the specified date referred to shall be a date not more than
three business days prior to Closing Time.
(g) Approval of Listing. At Closing Time, the Securities
shall have been approved for listing on the New York Stock Exchange,
subject only to official notice of issuance.
(h) No Objection. The NASD has confirmed that it has not
raised any objection with respect to the fairness and reasonableness of
the underwriting terms and arrangements.
21
(i) Lock-up Agreements. At the date of this Agreement, the
Interna tional Managers shall have received an agreement substantially
in the form of Exhibit B hereto signed by each of the persons listed on
Schedule C hereto.
(j) Purchase of Initial U.S. Securities. Contemporaneously
with the purchase by the International Managers of the Initial
International Securities under this Agreement, the U.S. Underwriters
shall have purchased the Initial U.S. Securities under the U.S. Purchase
Agreement.
(k) Conditions to Purchase of International Option
Securities. In the event that the International Managers exercise their
option provided in Section 2(b) hereof to purchase all or any portion of
the International Option Securities, the represen tations and warranties
of the Company contained herein and the statements in any certificates
furnished by the Company or any subsidiary of the Company hereunder
shall be true and correct as of each Date of Delivery and, at the
relevant Date of Delivery, the International Managers shall have
received:
(i) Officers' Certificate. A certificate, dated
such Date of Deliv ery, of the Chief Executive Officer of
the Company and of the Chief Financial Officer of the
Company confirming that the certificate delivered at the
Closing Time pursuant to Section 5(d) hereof remains true
and correct as of such Date of Delivery.
(ii) Opinions of Counsel for Company. The favorable
opinions of Xxxxxxxxxx Xxxxxxxxx Xxxxxx & LLP Xxxxxx and
Weil, Gotshal & Xxxxxx LLP, counsel for the Company, in
form and substance reasonably satisfac tory to counsel for
the International Managers, dated such Date of Deliv ery,
relating to the International Option Securities to be
purchased on such Date of Delivery and otherwise to the
same effect as the opinions required by Section 5(b)
hereof.
(iii) Opinion of Counsel for International Managers.
The favorable opinion of Skadden, Arps, Slate, Xxxxxxx &
Xxxx LLP, counsel for the International Managers, dated
such Date of Delivery, relating to the International
Option Securities to be purchased on such Date of Delivery
and otherwise to the same effect as the opinion required
by Section 5(c) hereof.
22
(vi) Bring-down Comfort Letters. Letters from
Ernst & Young LLP, Xxxxxxx, Xxxx & Co., PA, KPMG Peat
Marwick LLP, Xxxxx Xxxxx ton, LLP, KPMG Peat Marwick
(Canada) and Xxxxxxxxx, Xxxxxxx & Xxxx, P.C., in form and
substance satisfactory to the International Manag ers and
dated such Date of Delivery, substantially in the same
form and substance as the letters furnished to the
International Managers pursuant to Section 5(f) hereof,
except that the "specified date" in the letters furnished
pursuant to this paragraph shall be a date not more than
five days prior to such Date of Delivery.
(l) Additional Documents. At Closing Time and at each Date of
Delivery counsel for the International Managers shall have been furnished with
such documents and opinions as they may reasonably require for the purpose of
enabling them to pass upon the issuance and sale of the Securities as herein
contemplated, or in order to evidence the accuracy of any of the representations
or warranties, or the fulfillment of any of the conditions, herein contained;
and all proceedings taken by the Company in connection with the issuance and
sale of the Securities as herein contemplated shall be reasonably satisfactory
in form and substance to the International Managers and counsel for the
International Managers.
(m) Termination of Agreement. If any condition specified in this
Section shall not have been fulfilled when and as required to be fulfilled, this
Agreement, or, in the case of any condition to the purchase of International
Option Securities on a Date of Delivery which is after the Closing Time, the
obligations of the several International Managers to purchase the relevant
Option Securities may be terminated by the International Managers by notice to
the Company at any time at or prior to Closing Time or such Date of Delivery, as
the case may be, and such termination shall be without liability of any party to
any other party except as provided in Section 4 and except that Sections 1, 6, 7
and 8 shall survive any such termination and remain in full force and effect.
SECTION 6. Indemnification.
(a) Indemnification of International Managers. The Company agrees
to indemnify and hold harmless each International Manager and each person, if
any, who controls any International Manager within the meaning of Section 15 of
the 1933 Act or Section 20 of the 1934 Act as follows:
(i) against any and all loss, liability, claim, damage
and expense whatsoever, as incurred, arising out of any untrue
statement or alleged untrue
23
statement of a material fact contained in the Registration
Statement (or any amendment thereto), including the Rule 430A
Information and the Rule 434 Information, if applicable, or the
omission or alleged omission therefrom of a material fact
required to be stated therein or necessary to make the statements
therein not misleading or arising out of any untrue statement or
alleged untrue statement of a material fact included in any
preliminary prospectus or the Prospec tuses (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 whatso ever, as incurred, to the extent of the
aggregate amount paid in settlement of any litigation, or any
investigation or proceeding by any governmental agency or body,
commenced or threatened, or of any claim whatsoever based upon
any such untrue statement or omission; provided that (subject to
Section 6(d) below) any such settlement is effected with the
written consent of the Company; and
(iii) against any and all expense whatsoever, as incurred
(including, subject to Section 6(c) hereof, the fees and
disbursements of counsel chosen by Xxxxxxx Xxxxx), reasonably
incurred in investigating, preparing or defending against any
litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any
claim whatsoever based upon any such untrue statement or
omission, or any such alleged untrue statement or omission, to
the extent that any such expense is not paid under (i) or (ii)
above;
provided, however, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Company by any
International Manager through the International Managers expressly for use in
the Registration Statement (or any amendment thereto), including the Rule 430A
Information and the Rule 434 Information, if applicable, or any preliminary
prospectus or the International Prospectus (or any amendment or supplement
thereto); provided, further, that the Company will not be liable to any
Underwriter or any person controlling such Underwriter with respect to any such
untrue statement or omission made in any Preliminary Prospectus that is
corrected in the Prospectus (or any amendment or supplement thereto) if the
person asserting any such loss, claim, damage or liability purchased Securities
from such Underwriter but was not sent or given a copy of the Prospectus (as
amended or supplemented) at or prior to the written
24
confirmation of the sale of such Securities to such person in any case where
such delivery of the Prospectus (as amended or supplemented) is required by the
Act, unless such failure to deliver the Prospectus (as amended or supplemented)
was a result of noncompliance by the Company with Sections 5(d) or 5(e) of this
Agreement.
(b) Indemnification of Company, Directors and Officers. Each
International Manager severally agrees to indemnify and hold harmless the
Company, its directors, each of its officers who signed the Registration
Statement, and each person, if any, who controls the Company within the meaning
of Section 15 of the 1933 Act or Section 20 of the 1934 Act 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), including the Rule 430A
Information and the Rule 434 Information, if applicable, or any preliminary
international prospectus or the International Prospectus (or any amendment or
supplement thereto) in reliance upon and in conformity with written information
furnished to the Company by such International Manager expressly for use in the
Registration Statement (or any amendment thereto) or such preliminary prospectus
or the International Prospectus (or any amendment or supplement thereto).
(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 such indemnifying party from any liability hereunder to the extent it is
not materially prejudiced as a result thereof and in any event shall not relieve
it from any liability which it may have otherwise than on account of this
indemnity agreement. In the case of parties indemnified pursuant to Section 6(a)
above, counsel to the indemnified parties shall (subject to the following
sentence) be selected by Xxxxxxx Xxxxx, and, in the case of parties indemnified
pursuant to Section 6(b) above, counsel to the indemnified parties shall be
selected by the Company. In case any such action is brought against any
indemnified party, and it notifies the indemnifying party of the commencement
thereof, the indemnifying party will be entitled to participate therein and, to
the extent that it may wish, jointly with any other indemnifying party similarly
notified, to assume the defense thereof with counsel satisfactory to such
indemnified party; 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 and provided, further, that if the defendants in any such
action include both the indemnified party and the indemnifying party and the
indemnified party shall have reasonably concluded that there may be one or more
legal defenses available to it and/or other indemnified parties which are
different from or additional to those available to the indemnify
25
ing party, the indemnifying party shall not have the right to direct the defense
of such action on behalf of such indemnified party or parties and such
indemnified party or parties shall have the right to select separate counsel to
defend such action on behalf of such indemnified party or parties. In no event
shall the indemnifying parties be liable for 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; After notice from the indemnifying party
to such indemnified party of its election so to assume the defense thereof and
approval by such indemnified party of counsel appointed to defend such action,
the indemnifying party will not be liable to such indemnified party under this
Section 6 for any legal or other expenses, other than reasonable costs of
investigation, subsequently incurred by such indemnified party in connection
with the defense thereof, unless (i) the indemnified party shall have employed
separate counsel in accordance with the proviso to the next preceding sentence
(it being understood, however, that in connection with such action the
indemnifying party shall not be liable for the expenses of more than one
separate counsel (in addition to local counsel) in any one action or separate
but substantially similar actions in the same jurisdiction arising out of the
same general allegations or circumstances, designated by the U.S. Underwriters
in the case of paragraph (a) of this Section 6, representing the indemni fied
parties under such paragraph (a) who are parties to such action or actions) or
(ii) the indemnifying party does not promptly retain counsel satisfactory to the
indemnified party or (iii) the indemnifying party has authorized the employment
of counsel for the indemnified party at the expense of the indemnifying party.
The indemnifying party will not be liable for the costs and expenses of any
settlement of such action effected by such indemnified party without the consent
of the indemnifying party.
No indemnifying party shall, without the prior written consent of
the indemnified parties, settle or compromise or consent to the entry of any
judgment with respect to any litigation, or any investigation or proceeding by
any governmental agency or body, commenced or threatened, or any claim
whatsoever in respect of which indemnification or contribution could be sought
under this Section 6 or Section 7 hereof (whether or not the indemnified parties
are actual or potential parties thereto), unless such settlement, compromise or
consent (i) includes an unconditional release of each indemnified party from all
liability arising out of such litigation, investigation, proceeding or claim and
(ii) does not include 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
26
settlement of the nature contemplated by Section 6(a) effected without its
written consent if (i) such settlement is entered into more than 45 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 30 days prior to such settlement being entered into and (iii) such
indemnifying party shall not have reimbursed such indemnified party in
accordance with such request prior to the date of such settlement.
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 International Managers on the other hand from the offering of the
Securities pursuant to this Agreement or (ii) if the allocation provided by
clause (i) is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause (i)
above but also the relative fault of the Company on the one hand and of the
International Managers on the other hand in 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
International Managers on the other hand in connection with the offering of the
International Securities pursuant to this Agreement shall be deemed to be in the
same respective proportions as the total net proceeds from the offering of the
International Securities pursuant to this Agreement (before deducting expenses)
received by the Company and the total underwriting discount received by the
International Managers, in each case as set forth on the cover of the
International Prospectus, or, if Rule 434 is used, the corresponding location on
the Term Sheet, bear to the aggregate initial public offering price of the
International Securities as set forth on such cover.
The relative fault of the Company on the one hand and the International
Managers on the other hand shall be determined by reference to, among other
things, whether any such untrue or alleged untrue statement of a material fact
or omission or alleged omission to state a material fact relates to information
supplied by the Company or by the International Managers and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission or any violation of the nature referred to in
Section 6(a)(ii) hereof.
The Company and the International Managers agree that it would not be
just and equitable if contribution pursuant to this Section 7 were determined by
pro rata allocation (even
27
if the International Managers were treated as one entity for such purpose) or by
any other method of allocation which does not take account of the equitable
considerations referred to above in this Section 7. The aggregate amount of
losses, liabilities, claims, damages and expenses incurred by an indemnified
party and referred to above in this Section 7 shall be deemed to include any
legal or other expenses reasonably incurred by such indemnified party in
investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue or alleged untrue
statement or omission or alleged omission.
Notwithstanding the provisions of this Section 7, no International
Manager shall be required to contribute any amount in excess of the amount by
which the total price at which the International Securities underwritten by it
and distributed to the public were offered to the public exceeds the amount of
any damages which such International Managers 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
International Manager within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act shall have the same rights to contribution as such
International Manager, and each director of the Company, each officer of the
Company who signed the Registration Statement, and each person, if any, who
controls the Company within the meaning of Section 15 of the 1933 Act or Section
20 of the 1934 Act shall have the same rights to contribution as the Company.
The International Managers' respective obligations to contribute pursuant to
this Section 7 are several in proportion to the number of Initial International
Securities set forth opposite their respective names in Schedule A hereto and
not joint.
SECTION 8. Representations, Warranties and Agreements to Survive
-----------------------------------------------------
Delivery.
--------
All representations, warranties and agreements contained in this
Agreement or in certificates of officers of the Company or any of its
subsidiaries submitted pursuant hereto, shall remain operative and in full force
and effect, regardless of any investigation made by or on behalf of any
International Manager or controlling person, or by or on behalf of the Company,
and shall survive delivery of the Securities to the International Managers.
28
SECTION 9. Termination of Agreement.
-------------------------
(a) Termination; General. The International Managers may
terminate this Agreement, by notice to the Company, at any time at or prior to
Closing Time (i) if there has been, since the time of execution of this
Agreement or since the respective dates as of which information is given in the
International Prospectus, any material adverse change in the condi tion,
financial or otherwise, or in the earnings, business affairs or business
prospects of the Company and its subsidiaries considered as one enterprise,
whether or not arising in the ordinary course of business, or (ii) if there has
occurred any material adverse change in the financial markets in the United
States or the international financial markets, any outbreak of hostilities or
escalation thereof or other calamity or crisis or any change or development
involving a prospec tive change in national or international political,
financial or economic conditions, in each case the effect of which is such as to
make it, in the judgment of the International Managers, impracti cable to market
the Securities or to enforce contracts for the sale of the Securities, or (iii)
if trading in any securities of the Company has been suspended or materially
limited by the Commission or the New York Stock Exchange, or if trading
generally on the American Stock Exchange or the New York Stock Exchange or in
the Nasdaq National Market has been suspended or materially limited, or minimum
or maximum prices for trading have been fixed, or maximum ranges for prices have
been required, by any of said exchanges or by such system or by order of the
Commission, the National Association of Securities Dealers, Inc. or any other
governmental authority, or (iv) if a banking moratorium has been declared by
either Federal or New York authorities.
(b) Liabilities. If this Agreement is terminated pursuant to this
-----------
Section, such termination shall be without liability of any party to any other
party except as provided in Section 4 hereof, and provided further that Sections
1, 6, 7 and 8 shall survive such termination and remain in full force and
effect.
SECTION 10. Default by One or More of the International Managers. If one
----------------------------------------------------
or more of the International Managers shall fail at Closing Time or a Date of
Delivery to purchase the Securities which it or they are obligated to purchase
under this Agreement (the "Defaulted Securities"), the International Managers
shall have the right, within 24 hours thereafter, to make arrangements for one
or more of the non-defaulting International Managers, or any other underwriters,
to purchase all, but not less than all, of the Defaulted Securities in such
amounts as may be agreed upon and upon the terms herein set forth; if, however,
the International Managers shall not have completed such arrangements within
such 24-hour period, then:
29
(a) if the number of Defaulted Securities does not exceed
10% of the number of International Securities to be purchased on such
date, each of the non-defaulting International Managers shall be
obligated, severally and not jointly, to purchase the full amount
thereof in the proportions that their respective underwriting
obligations hereunder bear to the underwriting obligations of all
non-defaulting Interna tional Managers, or
(b) if the number of Defaulted Securities exceeds 10% of
the number of International Securities to be purchased on such date,
this Agreement or, with respect to any Date of Delivery which occurs
after the Closing Time, the obligation of the Interna tional Managers to
purchase and of the Company to sell the Option Securities to be
purchased and sold on such Date of Delivery shall terminate without
liability on the part of any non-defaulting International Manager.
No action taken pursuant to this Section shall relieve any defaulting
International Manager from liability in respect of its default.
In the event of any such default which does not result in a termination
of this Agreement or, in the case of a Date of Delivery which is after the
Closing Time, which does not result in a termination of the obligation of the
International Managers to purchase and the Company to sell the relevant
International Option Securities, as the case may be, either the International
Managers or the Company shall have the right to postpone Closing Time or the
relevant Date of Delivery, as the case may be, for a period not exceeding seven
days in order to effect any required changes in the Registration Statement or
Prospectus or in any other documents or arrangements. As used herein, the term
"International Manager" includes any person substituted for an International
Manager under this Section 10.
SECTION 11. Notices. All notices and other communications hereunder
shall be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the
International Managers shall be directed to Xxxxxxx Xxxxx International at Xxxxx
Xxxxx, Xxxxx Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000-0000, attention of
Xxxxxx X. Xxxxxxxx; and notices to the Company shall be directed to it at Four
Xxxxxxxxx Xxxxxx Xxxx, Xxxxxxxxx, Xxxxxxxxxxx 00000, attention of Xxxxxxx X.
Xxxxxx, with copies to Xxxxx X. Xxxxxx, 000 Xxxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx,
Xxx Xxxx 00000 and Xxxxxx Xxxxxxxxxx, Xxxxxxxxxx Xxxxxxxxx Xxxxxx & Xxxxxx LLP,
00 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000.
30
SECTION 12. Parties. This Agreement shall each inure to the benefit of
and be binding upon the International Managers and the Company and their
respective successors. Nothing expressed or mentioned in this Agreement is
intended or shall be construed to give any person, firm or corporation, other
than the International Managers and the Company and their respective successors
and the controlling persons and officers and directors referred to in Sections 6
and 7 and their heirs and legal representatives, any legal or equitable right,
remedy or claim under or in respect of this Agreement or any provision herein
contained. This Agreement and all conditions and provisions hereof are intended
to be for the sole and exclusive benefit of the International Managers and the
Company and their respective successors, and said controlling persons and
officers and directors and their heirs and legal representatives, and for the
benefit of no other person, firm or corporation. No purchaser of Securities from
any International Manager shall be deemed to be a successor by reason merely of
such purchase.
SECTION 13. GOVERNING LAW AND TIME. THIS AGREEMENT SHALL BE
----------------------
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK. SPECIFIED TIMES OF DAY REFER TO NEW YORK CITY
TIME.
SECTION 14. Effect of Headings. The Article and Section headings herein
------------------
and the Table of Contents are for convenience only and shall not affect the
construction hereof.
31
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Company a counterpart hereof, whereupon
this instrument, along with all counterparts, will become a binding agreement
between the International Managers and the Company in accordance with its terms.
Very truly yours,
UNITED RENTALS, INC.
By
-----------------------------
Name:
Title:
CONFIRMED AND ACCEPTED,
as of the date first above written:
XXXXXXX XXXXX INTERNATIONAL
XXXXXX XXXXXXXX & CO. LIMITED
XXXXXXXXX, XXXXXX & XXXXXXXX INTERNATIONAL
XXXXX XXXXXX INC.
BY: XXXXXXX XXXXX INTERNATIONAL
By
----------------------------
Authorized Signatory
32
SCHEDULE A
Number of
Initial International
Name of International Manager Securities
Xxxxxxx Xxxxx International...................................
Xxxxxx Xxxxxxxx & Co. Limited.................................
Xxxxxxxxx, Xxxxxx & Xxxxxxxx International....................
Xxxxx Xxxxxx Inc..............................................
Total......................................................... 1,300,000
============
Sch A - 1
SCHEDULE B
United Rentals, Inc.
1,300,000 Shares of Common Stock
(Par Value $.01 Per Share)
1. The public offering price per share for the Securities,
determined as provided in said Section 2, shall be $_____.
2. The purchase price per share for the International Securities
to be paid by the several International Managers shall be $_____, being an
amount equal to the public offering price set forth above less $_____ per share;
provided that the purchase price per share for any International Option
Securities purchased upon the exercise of the over-allotment option described in
Section 2(b) shall be reduced by an amount per share equal to any dividends or
distributions declared by the Company and payable on the Initial International
Securities but not payable on the International Option Securities.
Sch B - 1
SCHEDULE C
List of persons and entities
subject to lock-up
[TO BE INSERTED]
Sch C - 1
Exhibit A-1
FORM OF OPINION OF COMPANY'S COUNSEL
TO BE DELIVERED PURSUANT TO
SECTION 5(b)
As to various questions of fact material to our opinion, we have relied
upon the certificates of officers and upon certificates of public officials.
With regard to the due incorporation of corporations (other than the Company)
and the good standing of corporations (other than the Company), we have (subject
to the next sentence) relied entirely upon certifi xxxxx of public officials.
With regard to the tax good standing of certain corporations (other than the
Company), we have relied solely upon a certificate of an officer of such
corporation to the effect that the corporation has filed the most recent annual
report required by the law of such jurisdiction and that all franchise taxes
required to be paid under such law have been paid. We have also examined such
corporate documents and records and other certificates, and have made such
investigations of law, as we have deemed necessary in order to render the
opinion hereinafter set forth. We have assumed the authenticity of all documents
submitted to us as originals, the genuineness of all signatures, the legal
capacity of natural persons and the conformity to the originals of all documents
submitted to us as copies. We have also assumed that all documents examined by
us have been duly and validly authorized, executed and delivered by each of the
parties thereto other than the Company.
(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.
(ii) The Company has corporate power and authority to own, lease
and operate its properties and to conduct its business as described in
the Prospectus and to enter into and perform its obligations under the
Purchase Agreement.
(iii) The Company is duly qualified as a foreign corporation to
transact business and is in good standing in each jurisdiction in which
such qualification is required, whether by reason of the ownership or
leasing of property or the conduct of business, except where the failure
so to qualify or to be in good standing would not result in a Material
Adverse Effect.
A-1-1
(iv) The authorized, issued and outstanding capital stock of
the Company is as set forth in the Prospectus under "Description of
Capital Stock--General" (except for subsequent issuances, if any,
pursuant to the Purchase Agreement or pursuant to reservations,
agreements or employee benefit plans referred to in the Prospectus or
pursuant to the exercise of convertible securities, warrants or options
referred to in the Prospectus); the shares of issued and outstanding
capital stock of the Company have been duly authorized and validly
issued and are fully paid and non-assessable; and none of the
outstanding shares of capital stock of the Company was issued in
violation of any preemptive or other similar rights of any security
holder of the Company arising by statute or the Company's certificate of
incorporation or by-laws or, to the best of our knowledge, any other
preemptive or other similar rights of any security holder of the
Company.
(v) The Securities have been duly authorized for issuance and
sale to the Underwriters pursuant to the Purchase Agreement and, when
issued and delivered by the Company pursuant to the Purchase Agreement
against payment of the consideration set forth in the Purchase
Agreement, will be validly issued and fully paid and non-assessable and
no holder of the Securities is or will be subject to personal liability
by reason of being such a holder.
(vi) The issuance of the Securities is not subject to preemptive
or other similar rights of any security holder of the Company arising by
statute or the Com pany's certificate of incorporation or by-laws or, to
the best of our knowledge, any other preemptive or other similar rights
of any security holder of the Company.
(vii) Each subsidiary has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, has corporate power and authority to
own, lease and operate its properties and to conduct its business as
described in the Prospectus and is duly qualified as a foreign
corporation to transact business and is in good standing in each
jurisdiction in which such qualifica tion is required, whether by reason
of the ownership or leasing of property or the conduct of business,
except where the failure so to qualify or to be in good standing would
not result in a Material Adverse Effect; except as otherwise disclosed
in the Registration Statement and other than as contemplated by the
Credit Agreement of the Company filed as Exhibit 10(a) to the
Registration Statement, all of the issued and outstanding capital stock
of each subsidiary has been duly authorized and validly issued, is fully
paid and non-assessable and, to the best of our knowledge, is owned by
the Company, directly or through subsidiaries, free and clear of any
security interest,
A-1-2
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 security holder of
such subsidiary.
(viii) The Purchase Agreement has been duly authorized, executed
and delivered by the Company.
(ix) The Registration Statement, including any Rule 462(b)
Registra tion Statement, has been declared effective under the 1933 Act;
any required filing of the Prospectus pursuant to Rule 424(b) has been
made in the manner and within the time period required by Rule 424(b);
and, to the best of our knowledge, no stop order suspending the
effectiveness of the Registration Statement or any Rule 462(b) Registra
tion Statement has been issued under the 1933 Act and no proceedings for
that purpose have been instituted or are pending or threatened by the
Commission.
(x) The Registration Statement, including any Rule 462(b)
Registration Statement, the Rule 430A Information and the Rule 434
Information, as applicable, the Prospectus, and each amendment or
supplement to the Registration Statement and Prospectus, as of their
respective effective or issue dates (other than the financial statements
and supporting schedules included therein or omitted therefrom, as to
which we need express no opinion) complied as to form in all material
respects with the requirements of the 1933 Act and the 1933 Act
Regulations.
(xi) If Rule 434 has been relied upon, the Prospectus was not
"materially different," as such term is used in Rule 434, from the
prospectus included in the Registration Statement at the time it became
effective.
(xii) The form of certificate used to evidence the Common Stock
complies in all material respects with all applicable statutory
requirements, with any applicable requirements of the charter and
by-laws of the Company and the require ments of the New York Stock
Exchange.
(xiii) To the best of our knowledge, there is not pending or
threatened any action, suit, proceeding, inquiry or investigation, to
which the Company or any subsidiary is a party, or to which the property
of the Company or any subsidiary is subject, before or brought by any
court or governmental agency or body, domestic or foreign, which might
reasonably be expected to result in a Material Adverse Effect, or
A-1-3
which might reasonably be expected to materially and adversely affect
the properties or assets thereof or the consummation of the transactions
contemplated in the Purchase Agreement or the performance by the Company
of its obligations thereunder.
(xiv) The information in the Prospectus under "Dividend
Policy" and "Description of Capital Stock", "Certain Charter and By-Law
Provisions", and in the Registration Statement under Item 14 and Item
15, insofar as they purport to constitute a summary of the terms of the
Common Stock, the provisions of the Company's certificate of
incorporation or By-laws or specific provisions of the Delaware General
Corporation Law referred to therein, are accurate summaries in all
material respects of such terms or provisions, as the case may be.
(xv) To the best of our knowledge, neither the Company nor any
subsidiary is in violation of its charter or by-laws.
(xvi) To the best of our knowledge, neither the Company nor any
subsidiary is in default in the due performance or observance of any
material obliga tion, agreement, covenant or condition contained in any
contract, indenture, mortgage, loan agreement, note, lease or other
agreement or instrument that is described or referred to in the
Registration Statement or the Prospectus or filed or incorporated by
reference as an exhibit to the Registration Statement which violations
or defaults are required to be described in the prospectus and are not
so described or would, individu ally or in the aggregate, have a
Material Adverse Effect or effect the validity of the Securities.
(xvii) No filing with, or authorization, approval, consent,
license, order, registration, qualification or decree of, any court or
governmental authority or agency, domestic or foreign (other than under
the 1933 Act and the 1933 Act Regulations and the 1934 Act and the 1934
Act Regulations, which have been obtained, or as may be required under
the securities or blue sky laws of the various states, as to which we
need express no opinion) is necessary or required in connection with the
due authoriza tion, execution and delivery of the Purchase Agreement or
for the offering, issuance or sale of the Securities.
(xviii) The execution, delivery and performance of the Purchase
Agreement and the consummation of the transactions contemplated in the
Purchase Agreement and in the Registration Statement (including the
issuance and sale of the Securities and the use of a portion of the net
proceeds from the sale of the Securities to repay outstanding
A-1-4
indebtedness as described in the Prospectus under the caption "Use Of
Proceeds") and
compliance by the Company with its obligations under the Purchase
Agreement (A) after reasonable investigation do not and will not,
whether with or without the giving of notice or lapse of time or both,
conflict with or constitute a breach of, or default or Repayment Event
(as defined in Section 1(a)(x) of the Purchase Agreement) under or
result in the creation or imposition of any lien, charge or encumbrance
upon any property or assets of the Company or any subsidiary pursuant to
any contract, inden ture, mortgage, deed of trust, loan or credit
agreement, note, lease or any other agreement or instrument, known to
us, to which the Company or any subsidiary is a party or by which it or
any of them may be bound, or to which any of the property or assets of
the Company or any subsidiary is subject (except for such conflicts,
breaches or defaults, Repayment Events or liens, charges or encumbrances
that would not have a Material Adverse Effect), (B) result in any
violation of the provisions of the charter or by-laws of the Company or
any subsidiary, or (C) to the best of our knowledge, result in any
violation of the provisions of any applicable law, statute, rule or
regulation of the United States of America or included in the Delaware
General Corporate Law (except we express no opinion as to "blue sky"
laws), judgment, order, writ or decree, known to us, of any government,
government instrumentality or court, domestic or foreign, having
jurisdiction over the Company or any subsidiary or any of their
respective properties, assets or operations.
(xix) To the best of our knowledge, there are no persons with
registra tion rights or other similar rights to have any securities
registered pursuant to the Registration Statement.
(xx) The Company is not an "investment company" or an entity
"controlled" by an "investment company," as such terms are defined in
the 1940 Act.
(xxi) We have reviewed the Prospectus and the Registration
Statement and participated in discussions with your representatives and
those of the Company, its accountants and its other counsel. Although we
have not undertaken, except as otherwise indicated in this opinion, to
investigate or verify independently, and do not assume responsibility
for, the accuracy, completeness or fairness of the statements contained
in the Registration Statement, on the basis of the information that we
gained in the course of the performance of such services and our
representation of the Company, we confirm to you that nothing that came
to our attention in the course of such review or representation has
caused us to belief that (i) the Registration Statement or any amendment
thereto, including the Rule 430A Information and Rule 434 Informa tion
(if applicable), (except for financial statements and schedules and
other financial
data included therein or omitted therefrom, as to which we need make no
statement), at the time such Registration Statement or any such
amendment became effective, contained an untrue statement of a material
fact or omitted to state a material fact required to be stated therein
or necessary to make the statements therein not misleading or that the
Prospectus or any amendment or supplement thereto (except for financial
statements and schedules and other financial data included therein or
omitted there from, as to which we need make no statement), at the time
the Prospectus was issued, at the time any such amended or supplemented
prospectus was issued or at the Closing Time, included or includes an
untrue statement of a material fact or omitted or omits to state a
material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading or
(ii) that there are any franchises, contracts, indentures, mortgages,
loan agreements, notes, leases or other instruments required to be
described or referred to in the Registration Statement or to be filed as
exhibits thereto other than those described or referred to therein or
filed or incorporated by reference as exhibits thereto or that any
descriptions of or references to any of the foregoing are not correct in
all material respects.
In rendering such opinion, such counsel may rely, as to matters
of fact (but not as to legal conclusions), to the extent they deem proper, on
certificates of responsible officers of the Company and public officials. Such
opinion shall not state that it is to be governed or qualified by, or that it is
otherwise subject to, any treatise, written policy or other document relating to
legal opinions, including, without limitation, the Legal Opinion Accord of the
ABA Section of Business Law (1991).
X-0-0
Xxxxxxx X-0
FORM OF OPINION OF COMPANY'S
COUNSEL TO BE DELIVERED PURSUANT
TO SECTION 5(b)
(i) The Company is a corporation duly incorporated, validly existing and
in good standing under the laws of the State of Delaware, and has all requisite
corporate power and authority to own, lease and operate its properties and to
carry on its business as described in the Prospectuses and to enter into and
perform its obligations under the Purchase Agreements.
(ii) The authorized, issued and outstanding capital stock of the Company
is as set forth in the Prospectuses under the caption entitled "Description of
Capital Stock-General" (except for subsequent issuances pursuant to the Purchase
Agreements or pursuant to reservations, agreements, rights, or stock option or
employee benefit plans referred to in the Prospectuses, or pursuant to the
exercise of convertible securities, warrants, rights or options referred to in
the Prospectuses, or pursuant to an adjustment to the amount of the Stock
Consideration (as defined in the Prospectuses)). All of the issued and
outstanding shares of capital stock of the Company have been duly authorized and
validly issued and are fully paid and nonassessable; and none of the outstanding
shares of capital stock of the Company were issued in violation of preemptive
rights pursuant to law or in the Company's certificate of incorporation or
by-laws.
(iii) The Securities have been duly authorized and, when issued and
delivered as contemplated by the Purchase Agreements against payment of the
consideration therefor set forth in the Purchase Agreements, will be validly
issued, fully paid and nonassessable and free of preemptive rights pursuant to
law or in the Company's certificate of incorporation or by laws, and no holder
of the Securities is or will be subject to personal liability solely by reason
of being such a holder.
(iv) The execution, delivery and performance of the Purchase Agreements
by the Company have been duly authorized by all necessary corporate action on
the part of the Company. The Purchase Agreements have been duly and validly
executed and delivered by the Company.
(v) We have been informed that the Registration Statement was declared
effective under the 1933 Act as of _______ a.m./p.m. on _______, 1998, and to
our knowledge, as of _____a.m./p.m. on the date hereof, no stop order suspending
the effectiveness of the Registration Statement has been issued under the 1933
Act and, to our knowledge, no proceedings for that
A-2-1
purpose have been instituted or are pending or threatened by the Commission. The
Prospectuses have been filed with the Commission pursuant to Rule 424(b) under
the 1933 Act.
(vi) The Registration Statement and the Prospectuses (except for the
financial statements and the notes thereto and the other financial, statistical
and accounting data included in the Registration Statement or the Prospectuses,
as to which we express no opinion) comply as to form in all material respects
with the requirements of the 1933 Act and the rules and regulations thereunder.
(vii) The statements contained in the Prospectuses under the captions
"Dividend Policy," "Description of Capital Stock," "Certain Charter and By-Law
Provisions" and "Certain United States Federal Tax Considerations," and in Part
II of the Registration Statement under Item 14 and Item 15, insofar as they
purport to describe the provisions of the documents referred to therein or
matters of federal or Delaware corporate law, constitute a fair summary thereof
in material respects; and all descriptions in the Registration Statement of
contracts or agreements to which the Company or any of its subsidiaries is a
party are accurate in all material respects.
(viii) No consent, approval, waiver, license or authorization or other
action by or filing with any New York, Delaware corporate or federal
governmental authority is required in connection with the execution and delivery
by the Company of the Purchase Agreements or the consummation by the Company of
the transactions contemplated thereby, except for filings and other actions
required under or pursuant to (i) the 1933 Act and the rules and regulations
promulgated thereunder, which have been made or obtained, and (ii) the 1934 Act
and the rules and regulations promulgated thereunder, any other federal or state
securities or "blue sky" laws, and the rules of the New York Stock Exchange, as
to which we express no opinion.
(ix) The Company is not an "investment company" or an entity
"controlled" by an investment company", as such terms are defined in the 1940
Act.
(x) To our knowledge, there are no persons with registrations rights or
other similar rights to have any securities registered pursuant to the
Registration Statement.
(xi) We have participated in conferences with directors, officers and
other representa tives of the Company, representatives of the independent public
accountants for the Company, representatives of the Underwriters and
representatives of counsel for the Underwriters, at which conferences the
contents of the Registration Statement and the Prospectuses and related matters
were discussed, and, although we have not independently verified and are not
passing upon and
A-2-2
assume no responsibility for the accuracy, completeness or fairness of the
statements contained in the Registration Statement and Prospectuses (except to
the extent specified in the foregoing opinions), no facts have come to our
attention which lead us to believe that the Registration Statement, on the
effective date thereof, contained an untrue statement of a material fact or
omitted to state a material fact required to be stated therein or necessary to
make the statements contained therein not misleading or that the Prospectuses,
on the date thereof or on the date hereof, contained or contain an untrue
statement of a material fact or omitted or omits to state a material fact
required to be stated therein or necessary to make the statements contained
therein, in light of the circumstances under which they were made, not
misleading (it being understood that we express no view with respect to the
financial statements and related notes, the financial statement schedules and
the other financial, statistical and accounting data included in the
Registration Statement or Prospectuses).
In rendering such opinion, such counsel may rely, as to matters
of fact (but not as to legal conclusions), to the extent they deem proper, on
certificates of responsible officers of the Company and public officials. Such
opinion shall not state that it is to be governed or qualified by, or that it is
otherwise subject to, any treatise, written policy or other document relating to
legal opinions, including, without limitation, the Legal Opinion Accord of the
ABA Section of Business Law (1991).
In rendering such opinion, such counsel may rely, as to matters
of fact (but not as to legal conclusions), to the extent they deem proper, on
certificates of responsible officers of the Company and public officials. Such
opinion shall not state that it is to be governed or qualified by, or that it is
otherwise subject to, any treatise, written policy or other document relating to
legal opinions, including, without limitation, the Legal Opinion Accord of the
ABA Section of Business Law (1991).
A-2-3
FORM OF LOCK-UP FROM DIRECTORS, OFFICERS AND OTHER STOCKHOLDERS
PURSUANT TO SECTION 5(i)
Exhibit B
____________, 1998
XXXXXXX XXXXX & CO.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated,
Deutsche Xxxxxx Xxxxxxxx Inc.
Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities Corporation
Xxxxx Xxxxxx Inc.
as Representatives of the several Underwriters to
be named in the within-mentioned Purchase Agreement
x/x Xxxxxxx Xxxxx & Xx.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
Xxxxx Xxxxx
Xxxxx Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000-0000
Re: Proposed Public Offering by United Rentals, Inc.
Ladies and Gentlemen:
The undersigned, a stockholder and an officer and/or director of United
Rentals, Inc., a Delaware corporation (the "Company"), understands that Xxxxxxx
Xxxxx & Co., Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated ("Xxxxxxx
Xxxxx"), Deutsche Xxxxxx Xxxxxxxx Inc., Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities
Corporation and Xxxxx Xxxxxx Inc. propose to enter into a Purchase Agreement
(the "Purchase Agreement") with the Company providing for the public offering of
B-1
shares (the "Securities") of the Company's common stock, par value $.01 per
share (the "Common Stock"). In recognition of the benefit that such an offering
will confer upon the undersigned as a stockholder and an officer and/or director
of the Company, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the undersigned agrees with each
underwriter to be named in the Purchase Agreement that, during a period of 180
days from the date of the Purchase Agreement, the undersigned will not, without
the prior written consent of Xxxxxxx Xxxxx on behalf of the Underwriters named
in the Purchase Agreement, directly or indirectly, (i) offer, pledge, sell,
contract to sell, sell any option or contract to purchase, purchase any option
or contract to sell, grant any option, right or warrant for the sale of, or
otherwise dispose of or transfer any shares of the Company's Common Stock or any
securities convertible into or exchangeable or exercisable for Common Stock,
whether now owned or hereafter acquired by the undersigned or with respect to
which the undersigned has or hereafter acquires the power of disposition, or
file any registration statement under the Securities Act of 1933, as amended,
with respect to any of the foregoing or (ii) enter into any swap or any other
agreement or any transaction that transfers, in whole or in part, directly or
indirectly, the economic consequence of ownership of the Common Stock, whether
any such swap or transaction is to be settled by delivery of Common Stock or
other securities, in cash or otherwise.
Nothing contained herein limits the ability of the undersigned (i) to
transfer shares of Common Stock in a private placement pursuant to an exemption
from the registration requirements of the 1933 Act or (ii) to pledge shares of
Common Stock as security of indebtedness, provided, however, in either case the
transferee or pledgee agrees to be bound by the limitations contained herein.
Very truly yours,
Signature:___________________________
Print Name:__________________________
B-2
Annex A
FORM OF ACCOUNTANTS' COMFORT LETTER PURSUANT TO SECTION 5(e)
(i) We are independent public accountants with respect to the
Company1 within the meaning of the 1933 Act and the applicable published
1933 Act Regulations.
(ii) In our opinion, the financial statements audited by us and
the related financial statement schedules included 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
published rules and regulations thereunder.
(iii)2 On the basis of procedures (but not an examination in
accordance with generally accepted auditing standards) consisting of a
reading of the unaudited interim financial statements of the Company for
the _____ month periods ended _____________, 1996 and ______________,
1997, (collectively, the "Quarterly Financials"), a reading of the
latest available unaudited interim financial statements of the Company,
a reading of the minutes of all meetings of the stockholders and
directors of the Company and the _________________ and
__________________ Committees of the Board of Directors of the Company
since _____, 19973, inquiries of certain officials of the Company
responsible for financial and accounting matters, a review of interim
financial information in accordance with standards established by the
American Institute of Certified Public Accountants in Statement on
Auditing Standards No. 71, Interim Financial Information ("SAS 71"),
with respect to the Quarterly Financials and such other inquiries and
procedures as may be specified in such letter, nothing came to our
attention that caused us to believe that:
--------
/1/ As used in this Annex A, the "Company" refers to United Rentals, Inc. or any
of its subsidiar ies, the respective financial statements of which have been
prepared by the accounting firm rendering the comfort letter.
/2/ Paragraph (iii) should be included for those comfort letters addressing
financial statements that include unaudited interim information.
/3/ Insert date that is one day after the end of the last audit period.
Annex A-1
(A) the Quarterly Financials included in the Registration
Statement and the Prospectus do not comply as to form in all
material respects with the applicable accounting requirements of
the 1933 Act and the 1933 Act Regulations or any material
modifications should be made to the unaudited financial
statements included in the Registration Statement and the
Prospectus for them to be in conformity with generally accepted
accounting principles;
(B) at _______, 199__4 and at a specified date not more
than five days5 prior to the date of this Agreement, there was
any change in the shareholder's equity of the Company or any
decrease in the assets of the Company or any increase in the
liabilities of the Company in each case as compared with amounts
shown in the latest balance sheet of the Company included in the
Registration Statement, except in each case for changes,
decreases or increases that the Registration Statement discloses
have occurred or may occur; or
(C) for the period from _________, 19___ to _________,
19___ and6 for the period from _________, 19___ to a specified
date not more than five days prior to the date of this Agreement,
there was any decrease in the cash and cash equivalents, net
rental equipment, total assets, debt or stockholders' equity in
each case as compared with the comparable period in the preceding
year, except in each case for any decreases that the Registration
Statement discloses have occurred or may occur.
--------
/4/ Insert the date of most recent balance sheet of the Company, if those
statements are more recent than the unaudited interim financial statements
included in the Registration Statement.
/5/ The specified date should be five calendar days prior to the date of the
Underwriting Agreement.
/6/ Insert dates to describe the period from the date of the most recent
financial statements in the Registration Statement to the date of the most
recent unaudited interim financial statements of the Company, if those
dates are different. Regardless of whether this language is inserted or
not, the period including five days prior to the date of the Underwriting
Agreement should run from the date of the last financial statement
included in the Registration Statement, not from the later one that is not
included in the Registration Statement.
Annex A-2
(iv) Based upon the procedures set forth in clause (ii) above and
a reading of the Selected Financial Data included in the Registration
Statement and a reading of the financial statements from which such data
were derived, nothing came to our attention that caused us to believe
that the Selected Financial Data included in the Registration Statement
do not comply as to form in all material respects with the disclosure
requirements of Item 301 of Regulation S-K of the 1933 Act, that the
amounts included in the Selected Financial Data are not in agreement
with the corresponding amounts in the audited financial statements for
the respective periods or that the financial statements not included in
the Registration Statement from which certain of such data were derived
are not in conformity with generally accepted accounting principles.
(v) We have compared the information in the Registration
Statement under selected captions with the disclosure requirements of
Regulation S-K of the 1933 Act and on the basis of limited procedures
specified herein nothing came to our attention that caused us to believe
that this information does not comply as to form in all material
respects with the disclosure requirements of Items 302, 402 and 503(d),
respectively, of Regulation S-K.
(vi) Based upon the procedures set forth in clause (iii) above,
a reading of the unaudited financial statements of the Company for the
most recent period that have not been included in the Registration
Statement and a review of such financial statements in accordance with
SAS 71, nothing came to our attention that caused us to believe that the
unaudited amounts for the most recent period do not agree with the
amounts set forth in the unaudited financial statements for those
periods or that such unaudited amounts were not determined on a basis
substantially consistent with that of the corresponding amounts in the
audited financial statements.
(vii) We are unable to and do not express any opinion on the Pro
Forma Consolidated Financial Statements (the "Pro Forma Statement")
included 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 this letter we have:
(A) read the Pro Forma Statement;
(B) performed an audit of the financial statements to
which the pro forma adjustments were applied;
Annex A-3
(C) made inquiries of certain officials of the Company who
have responsibility for financial and accounting matters about
the basis for their determination of the pro forma adjustments
and whether the Pro Forma Statement complies as to form in all
material respects with the applicable accounting requirements of
Rule 11-02 of Regulation S-X; and
(D) proved the arithmetic accuracy of the application of
the pro forma adjustments to the historical amounts in the Pro
Forma Statement; and on the basis of such procedures and such
other inquiries and procedures as specified herein, nothing came
to our attention that caused us to believe that (i) the Pro Forma
Statement included in the Registration Statement does not comply
as to form in all material respects with the applicable
requirements of Rule 11-02 of Regulation S-X or (ii) the pro
forma adjustments have not been properly applied to the
historical amounts in the compilation of those statements.
(viii) In addition to the procedures referred to in clause (iii)
above, we have performed other procedures, not constituting an audit,
with respect to certain amounts, percentages, numerical data and
financial information appearing in the Registration Statement, which are
specified herein, and have compared certain of such items with, and have
found such items to be in agreement with, the accounting and financial
records of the Company.
Annex A-4
