EXHIBIT 1.1
EXECUTION COPY
GrafTech International Ltd.
22,000,000 Shares of Common Stock
($0.01 par value)
Underwriting Agreement
October 1, 2003
X.X. Xxxxxx Securities Inc.
As representative of the several underwriters
listed in Schedule I hereto
c/o X.X. Xxxxxx Securities Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
GrafTech International Ltd., a Delaware corporation (the "Company"),
proposes to issue and sell to you and the other underwriters listed on Schedule
I hereto (the "Underwriters"), for whom you are acting as representative (the
"Representative"), an aggregate of 22,000,000 shares of common stock, par value
$0.01 per share, of the Company (the "Underwritten Shares") and, for the sole
purpose of covering over-allotments in connection with the sale of the
Underwritten Shares, at the option of the Representative, up to an additional
3,300,000 shares of common stock, par value $0.01 per share, of the Company
(the "Option Shares"). The Underwritten Shares and the Option Shares are herein
referred to as the "Shares". The shares of common stock, par value $0.01 per
share, of the Company to be outstanding after giving effect to the sale of the
Shares are herein referred to as the "Stock". The Stock, including the Shares,
will have attached thereto rights (the "Rights") to purchase one one-thousandth
of a share of preferred stock, par value $0.01 per share, of the Company (the
"Preferred Stock") when the rights become exercisable pursuant to a Rights
Agreement, dated as of August 7, 1998, and as amended on November 11, 2000 (the
"Rights Agreement"), between the Company and Computershare Investor Services,
LLC, as successor to The Bank of New York, as rights agent.
The Company hereby confirms its agreement with the several Underwriters
concerning the purchase and sale of the Shares, as follows:
1. The Company has prepared and filed with the Securities and Exchange
Commission (the "Commission") in accordance with the provisions of the
Securities Act of 1933, as amended, and the rules and regulations of the
Commission thereunder (collectively, the "Securities Act"), a registration
statement (File No. 333-108039), including a form of prospectus, relating to the
Shares and Rights. The registration statement as amended at the time when it
became or shall become effective including information (if any) deemed pursuant
to Rule 430A under the
Securities Act to be part of the registration statement at the time of
effectiveness ("Rule 430A Information"), is referred to in this Agreement as the
"Registration Statement"; and, as used herein, the term "Preliminary Prospectus"
means each prospectus and prospectus supplement included in such registration
statement (and any amendments thereto) before it becomes effective, each
prospectus and prospectus supplement filed with the Commission pursuant to Rule
424(a) under the Securities Act and each prospectus and prospectus supplement
included in the Registration Statement at the time of its effectiveness that
omits Rule 430A Information, and the term "Prospectus" means the prospectus in
the form first used to confirm sales of Shares. If the Company has filed an
abbreviated registration statement pursuant to Rule 462(b) under the Securities
Act (the "Rule 462 Registration Statement"), then any reference herein to the
term "Registration Statement" shall be deemed to include such Rule 462
Registration Statement. Any reference in this Agreement to the Registration
Statement, any Preliminary Prospectus or the Prospectus shall be deemed to refer
to and include the documents incorporated by reference therein pursuant to Item
12 of Form S-3 under the Securities Act, as of the effective date of the
Registration Statement or the date of such Preliminary Prospectus or the
Prospectus, as the case may be, and any reference to "amend", "amendment" or
"supplement" with respect to the Registration Statement, any Preliminary
Prospectus or the Prospectus shall be deemed to refer to and include any
documents filed after such date under the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the Commission thereunder
(collectively, the "Exchange Act") that are deemed to be incorporated by
reference therein. Capitalized terms used but not defined herein shall have the
meanings given to such terms in the Registration Statement and the Prospectus.
2. The Company agrees to issue and sell the Underwritten Shares to the
several Underwriters as hereinafter provided, and each Underwriter, upon the
basis of the representations, warranties and agreements herein contained, but
subject to the conditions hereinafter stated, agrees to purchase, severally and
not jointly, from the Company the respective number of Underwritten Shares set
forth opposite such Underwriter's name in Schedule I hereto at a purchase price
per share of $8.00 (the "Purchase Price").
In addition, the Company agrees to issue and sell the Option Shares to
the several Underwriters as hereinafter provided, and the Underwriters on the
basis of the representations, warranties and agreements herein contained, but
subject to the conditions hereinafter stated, shall have the option to purchase,
severally and not jointly, from the Company up to an aggregate of 3,300,000
Option Shares at the Purchase Price, for the sole purpose of covering
over-allotments (if any) in the sale of Underwritten Shares by the several
Underwriters.
If any Option Shares are to be purchased, the number of Option Shares
to be purchased by each Underwriter shall be the number of Option Shares which
bears the same ratio to the aggregate number of Option Shares being purchased as
the number of Underwritten Shares set forth opposite the name of such
Underwriter in Schedule I hereto (or such number increased as set forth in
Section 9 hereof) bears to the aggregate number of Underwritten Shares being
purchased from the Company by the several Underwriters, subject, however, to
such adjustments to eliminate any fractional Shares as the Representative in its
sole discretion shall make.
The Underwriters may exercise the option to purchase any or all of the
Option Shares at any time or from time to time in part on or before the
thirtieth day following the date of this Agreement by written notice from the
Representative to the Company. Such notice shall set forth the aggregate number
of Option Shares as to which the option is being exercised and the date and time
when the Option Shares are to be delivered and paid for which may be the same
date and time as the Closing Date (as hereinafter defined) but shall not be
earlier than the Closing Date nor later than the tenth full Business Day (as
hereinafter defined) after the date of such notice (unless such time and date
are postponed in accordance with the provisions of Section 9 hereof). Any such
notice shall be given at least two Business Days prior to the date and time of
delivery specified therein.
The Company understands that the Underwriters intend (i) to make a
public offering of the Shares as soon after (A) the Registration Statement has
become effective and (B) the parties hereto have executed and delivered this
Agreement, as in the judgment of the Representative is advisable and (ii)
initially to offer the Shares upon the terms set forth in the Prospectus. The
Company acknowledges and agrees that the Underwriters may offer and sell Shares
to or through any affiliate of an Underwriter and that any such affiliate may
offer and sell Shares purchased by it to or through any Underwriter.
Payment for the Shares shall be made by wire transfer in immediately
available funds to the account specified by the Company to the Representative in
the case of the Underwritten Shares, at the offices of Cravath, Swaine & Xxxxx
LLP, 000 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx on October 7, 2003, or at such
other time or place on the same or such other date, not later than the fifth
Business Day thereafter, as the Representative and the Company may agree upon in
writing or, in the case of the Option Shares, on the date and at the time and
place specified by the Representative in the written notice of the Underwriters'
election to purchase such Option Shares. The time and date of such payment for
the Underwritten Shares is referred to herein as the "Closing Date" and the time
and date for such payment for the Option Shares, if other than the Closing Date,
is herein referred to as the "Additional Closing Date". For purposes of Rule
15c6-1 under the Exchange Act, the Closing Date (if later than the otherwise
applicable settlement date) shall be the settlement date for payment of funds
and delivery of securities for all the Shares sold pursuant to the offering. As
used herein, the term "Business Day" means any day other than a day on which
banks are permitted or required to be closed in New York City.
Payment for the Shares to be purchased on the Closing Date or the
Additional Closing Date, as the case may be, shall be made against delivery to
the Representative for the respective accounts of the several Underwriters of
the Shares to be purchased on such date registered in such names and in such
denominations as the Representative shall request in writing not later than two
full Business Days prior to the Closing Date or the Additional Closing Date, as
the case may be, with any transfer taxes payable in connection with the transfer
to the Underwriters of the Shares duly paid by the Company. The certificates for
the Shares will be made available for inspection and packaging by the
Representative at the office of X.X. Xxxxxx Securities Inc. set forth above not
later than 1:00 P.M., New York City time, on the Business Day prior to the
Closing Date or the Additional Closing Date, as the case may be.
3. The Company represents and warrants to each Underwriter that:
(a) no order preventing or suspending the use of any Preliminary
Prospectus has been issued by the Commission, and each Preliminary Prospectus,
at the time of filing thereof, complied in all material respects with the
Securities Act, and did not contain an untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary to make
the statements therein, in the light of the circumstances under which they were
made, not misleading; provided that this representation and warranty shall not
apply to any statements or omissions made in reliance upon and in conformity
with information relating to any Underwriter furnished to the Company in writing
by such Underwriter through the Representative expressly for use therein;
(b) the Registration Statement has been declared effective by the
Commission; no order suspending the effectiveness of the Registration Statement
has been issued by the Commission and no proceeding for that purpose has been
initiated or, to the knowledge of the Company, threatened by the Commission; and
the Registration Statement and Prospectus (as amended or supplemented if the
Company shall have furnished any amendments or supplements thereto) comply, or
will comply, as the case may be, as of the applicable effective date as to the
Registration Statement and as of the date of the Prospectus, in all material
respects with the Securities Act and do not and will not, as of the applicable
effective date as to the Registration Statement and any amendment thereto and as
of the date of the Prospectus and any amendment or supplement thereto, contain
any untrue statement of a material fact or omit to state any material fact
necessary to make the statements therein not misleading, and the Prospectus, as
amended or supplemented, if applicable, at the Closing Date or Additional
Closing Date, as the case may be, will not contain any untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading; except that the foregoing representations
and warranties shall not apply to statements or omissions in the Registration
Statement or the Prospectus made in reliance upon and in conformity with
information relating to any Underwriter furnished to the Company in writing by
such Underwriter expressly for use therein;
(c) the documents incorporated by reference in the Prospectus, when
they became effective or were filed with the Commission, as the case may be,
conformed in all material respects to the requirements of the Securities Act or
the Exchange Act, as applicable, and none of such documents contained an untrue
statement of a material fact or omitted to state a material fact necessary to
make the statements therein, in light of the circumstances under which they were
made, not misleading; and any further documents so filed and incorporated by
reference in the Prospectus, when such documents become effective or are filed
with the Commission, as the case may be, will conform in all material respects
to the requirements of the Securities Act or the Exchange Act, as applicable,
and will not contain an untrue statement of a material fact or omit to state a
material fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading;
(d) the financial statements, and the related notes thereto, included
or incorporated by reference in the Registration Statement and the Prospectus
comply in all material respects with the applicable requirements of the
Securities Act and the Exchange Act and present
fairly in all material respects, the consolidated financial position of the
Company and its consolidated subsidiaries as of the dates indicated and the
results of their operations and their consolidated cash flows for the periods
specified; and said financial statements have been prepared in conformity with
generally accepted accounting principles applied on a consistent basis
throughout such periods, and the supporting schedules included or incorporated
by reference in the Registration Statement present fairly in all material
respects the information required to be stated therein; and the other financial
information included or incorporated by reference in the Registration Statement
and the Prospectus has been derived from the accounting records of the Company
and its subsidiaries and presents fairly in all material respects the
information shown thereby;
(e) since the date of the latest audited financial statements included
or incorporated by reference in the Registration Statement and the Prospectus,
(i) there has not been any change in the capital stock or long-term debt of the
Company or any of its subsidiaries, or any dividend or distribution of any kind
declared, set aside for payment, paid or made by the Company on any class of
capital stock, or any material adverse change, or any development involving a
prospective material adverse change, in or affecting the condition (financial or
other), business, properties, management, financial position, stockholders'
equity, or results of operations of the Company and its subsidiaries, taken as a
whole, otherwise than as disclosed in the Prospectus; (ii) except as disclosed
in the Prospectus neither the Company nor any of its subsidiaries has entered
into any transaction or agreement (not in the ordinary course of business)
material to the Company and its subsidiaries, taken as a whole; and (iii)
neither the Company nor any of its subsidiaries has sustained any material loss
or interference with its business from fire, explosion, flood or other calamity,
whether or not covered by insurance, or from any labor disturbance or dispute or
any action, order or decree of any court or arbitrator or governmental or
regulatory authority, except as disclosed in the Registration Statement and the
Prospectus;
(f) other than this Agreement, there are no contracts, agreements or
understandings between the Company and any person that would give rise to a
valid claim against the Company or the Underwriters for a brokerage commission,
finder's fee or other like payment in connection with the offering;
(g) the Company and its subsidiaries own, possess or can acquire on
reasonable terms, adequate trademarks, trade names and other rights to
inventions, know-how, patents, copyrights, confidential information and other
intellectual property (collectively, "Intellectual Property Rights") necessary
to conduct the business now operated by them, or presently employed by them,
except where the failure to possess or acquire such Intellectual Property Rights
could not, individually or in the aggregate, reasonably be expected to have a
material adverse effect upon the Company and its subsidiaries, taken as a whole,
and have not received any notice of infringement of or conflict with asserted
rights of others with respect to any Intellectual Property Rights that, if
determined adversely to the Company or any of its subsidiaries, could,
individually or in the aggregate, reasonably be expected to have a material
adverse effect upon the Company and its subsidiaries, taken as a whole;
(h) on the Closing Date, Amendment No. 7 (the "Amendment") to the
credit agreement dated February 22, 2000 (the "Credit Agreement") among the
Company, GrafTech
Global Enterprises Inc. ("GrafTech Global"), GrafTech Finance Inc. ("GrafTech
Finance"), Xxxxxx Guaranty Trust Company of New York, X.X. Xxxxxx Securities
Inc., Credit Suisse First Boston and the other banks named therein will have
been duly authorized, executed and delivered by the Company, GrafTech Global and
GrafTech Finance and will conform in all material respects to the description
thereof in the Prospectus; and on the Closing Date, assuming the due
authorization, execution, and delivery by the agents and lenders thereunder, the
Amendment will constitute the valid and legally binding obligations of the
Company, GrafTech Global and GrafTech Finance, except to the extent that
enforcement thereof may be limited by bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws of general applicability
relating to or affecting creditors' rights and to general equity principles
(regardless of whether considered in a proceeding in equity or law);
(i) the Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Delaware, with
corporate power and authority to own its properties and conduct its business as
described in the Prospectus, and has been duly qualified as a foreign
corporation for the transaction of business and is in good standing under the
laws of each other jurisdiction in which it owns or leases properties, or
conducts business, so as to require such qualification, other than where the
failure to be so qualified or in good standing would not have a material adverse
effect on the Company and its subsidiaries, taken as a whole;
(j) the entities listed on Exhibit 21.1 to the Company's Annual Report
on Form 10-K for the year ended December 31, 2002 (the "List of Subsidiaries")
are the only material subsidiaries, direct or indirect, of the Company; each of
the Company's subsidiaries has been duly incorporated and is validly existing as
a corporation under the laws of its jurisdiction of incorporation, with
appropriate power and authority to own its properties and conduct its business
as described in the Prospectus, and has been duly qualified as a foreign
corporation for the transaction of business and is in good standing (or the
equivalent thereof under analogous principles of applicable foreign law in the
case of any foreign subsidiary) under the laws of each jurisdiction in which it
owns or leases properties, or conducts business, so as to require such
qualification, other than where the failure to be so qualified or in good
standing would not have a material adverse effect on the Company and its
subsidiaries, taken as a whole; and all the outstanding shares of capital stock
of each subsidiary of the Company have been duly authorized and validly issued,
are fully-paid and non-assessable (or the equivalent thereof under analogous
principles of applicable foreign law in the case of any foreign subsidiary), and
(except, in the case of foreign subsidiaries, for directors' qualifying shares)
are owned by the Company, directly or indirectly, free and clear of all liens,
encumbrances, security interests and claims, other than (1) director's
qualifying shares and the equivalent thereof, in the case of any foreign
subsidiaries, (2) as set forth on the List of Subsidiaries, and (3) those
created by the Security Agreements (as defined in the Credit Agreement) and in
existence on the Closing Date;
(k) the Company has full right, power and authority to execute and
deliver this Agreement and to perform its obligations hereunder;
(l) this Agreement has been duly authorized, executed and delivered by
the Company;
(m) the Company has an authorized capitalization as set forth in the
Prospectus and such authorized capital stock conforms to the description thereof
set forth in the Prospectus, and all of the outstanding shares of capital stock
of the Company have been duly authorized and validly issued, are fully-paid and
non-assessable and are not subject to any pre-emptive or similar rights; and,
except as described in or expressly contemplated by the Prospectus, there are no
outstanding rights (including, without limitation, pre-emptive rights), warrants
or options to acquire, or instruments convertible into or exchangeable for, any
shares of capital stock or other equity interest in the Company or any of its
subsidiaries, or any contract, commitment, agreement, understanding or
arrangement of any kind relating to the issuance of any capital stock of the
Company or any such subsidiary, any such convertible or exchangeable securities
or any such rights, warrants or options;
(n) the Shares to be issued and sold by the Company hereunder have been
duly authorized by the Company, and, when issued and delivered to and paid for
by the Underwriters in accordance with the terms of this Agreement, will be duly
issued, fully paid and non-assessable and will conform to the descriptions
thereof in the Prospectus; and the issuance of the Shares is not subject to any
preemptive or similar rights;
(o) the Rights Agreement has been duly authorized, executed and
delivered by the Company; and the Rights have been duly authorized by the
Company and, when issued upon issuance of the Shares, will be validly issued,
and the Preferred Stock has been duly authorized by the Company and validly
reserved for issuance and, when issued upon exercise in accordance with the
terms of the Rights Agreement, will be validly issued, fully paid and
non-assessable;
(p) neither the Company nor any of its subsidiaries is, or with the
giving of notice or lapse of time or both would be, in violation of or in
default under, its certificate of incorporation, by-laws or any other
organizational document or any indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument to which the Company or any of its
subsidiaries is a party or by which it or any of them or any of their respective
properties is bound, except for violations and defaults which individually and
in the aggregate are not material to the Company and its subsidiaries, taken as
a whole; the issue and sale of the Shares, the performance by the Company of its
obligations under this Agreement and the consummation of the transactions
contemplated herein will not (i) conflict with or result in a breach of any of
the terms or provisions of, or constitute a default under, any indenture,
mortgage, deed of trust, loan agreement or other agreement or instrument to
which the Company or any of its subsidiaries is a party or by which the Company
or any of its subsidiaries is bound or to which any of the property or assets of
the Company or any of its subsidiaries is subject, (ii) result in any violation
of the provisions of the certificate of incorporation or the by-laws of the
Company or any of its subsidiaries or (iii) result in any violation of any
applicable law or statute or any order, rule or regulation of any court or
governmental agency or body having jurisdiction over the Company, its
subsidiaries or any of their respective properties, except, in the case of
clauses (i) and (iii), for such conflicts, breaches, defaults and violations
which could not, individually or in the aggregate, reasonably be expected to
have a material adverse effect on the Company and its subsidiaries, taken as a
whole; and no consent, approval, authorization, order, license, registration or
qualification of or with any such court or governmental agency or body is
required for the issue and sale of the Shares or the consummation by the Company
of the transactions contemplated by
this Agreement, except such consents, approvals, authorizations, orders,
licenses, registrations or qualifications as have been obtained under the
Securities Act and as may be required under state securities or Blue Sky Laws in
connection with the purchase and distribution of the Shares by the Underwriters;
(q) other than as disclosed or contemplated in the Prospectus, there
are no legal, governmental or regulatory investigations, actions, suits or
proceedings pending or, to the knowledge of the Company, threatened against or
affecting the Company or any of its subsidiaries or any of their respective
properties or to which the Company or any of its subsidiaries is or may be a
party or to which any property of the Company or any of its subsidiaries is or
may be the subject which, if determined adversely to the Company or any of its
subsidiaries, could, individually or in the aggregate, have, or reasonably be
expected to have, a material adverse effect on the condition (financial or
other), business, properties, management, financial position, stockholders'
equity, or results of operations of the Company and its subsidiaries, taken as a
whole; and, to the best of the Company's knowledge, no such proceedings are
threatened or contemplated by governmental or regulatory authorities or
threatened by others;
(r) there are no (i) current or pending legal, governmental or
regulatory actions, suits or proceedings that are required to be described in
the Registration Statement or the Prospectus that are not so described or (ii)
statutes, regulations, contracts or other documents that are required to be
described in the Registration Statement or the Prospectus or to be filed as
exhibits to the Registration Statement that are not described or filed as
required;
(s) the Company and its subsidiaries have good and marketable title in
fee simple (or the equivalent thereof under analogous principles of applicable
foreign law) to all items of real property and good and marketable title to all
personal property owned by them, in each case free and clear of all liens,
encumbrances, claims and defects and imperfections of title except for those
created by the Security Agreements and in existence on the Closing Date or such
as are described or referred to in the Prospectus or do not materially affect
the value of such property and do not interfere with the use made or proposed to
be made of such property by the Company and its subsidiaries; and any real
property and buildings held under lease by the Company and its subsidiaries are
held by them under valid, existing and enforceable leases with such exceptions
as are not material and do not interfere with the use made or proposed to be
made of such property and buildings by the Company or its subsidiaries;
(t) no relationship, direct or indirect, exists between or among the
Company or any or its subsidiaries, on the one hand, and the directors,
officers, stockholders, customers or suppliers of the Company or any of its
subsidiaries, on the other hand, which is required by the Securities Act to be
disclosed in the Registration Statement and the Prospectus which is not so
described;
(u) no person has the right to require the Company to register any
securities for offering and sale under the Securities Act by reason of the
filing of the Registration Statement with the Commission or the issue and sale
of the Shares;
(v) the Company is not and, after giving effect to the offering and
sale of the Shares and the application of the proceeds thereof as described in
the Prospectus, will not be an "investment company" or an entity "controlled" by
an "investment company", as such terms are defined in the Investment Company Act
of 1940, as amended and the rules and regulations of the Commission thereunder
(collectively, the "Investment Company Act");
(w) KPMG LLP and Deloitte & Touche LLP, each of whom has certified
certain financial statements of the Company and its subsidiaries, are each
independent public accountants with respect to the Company and its subsidiaries
as required by the Securities Act;
(x) the Company and its subsidiaries have filed all material federal,
state, local and foreign tax returns which have been required to be filed and
have paid all taxes shown thereon and all assessments received by them or any of
them to the extent that such taxes have become due and are not being contested
in good faith; and, except as disclosed in the Registration Statement and the
Prospectus, there is no material tax deficiency which has been or might
reasonably be expected to be asserted or threatened against the Company or any
subsidiary or any of their respective properties or assets;
(y) the Company has not taken nor will it take, directly or indirectly,
any action designed to, or that might be reasonably expected to, cause or result
in stabilization or manipulation of the price of the Stock;
(z) each of the Company and its subsidiaries owns, possesses or has
obtained all licenses, permits, certificates, consents, orders, approvals and
other authorizations from, and has made all declarations and filings with, all
federal, state, local and other governmental authorities (including foreign
regulatory agencies), all self-regulatory organizations and all courts and other
tribunals, domestic or foreign, necessary to own or lease, as the case may be,
and to operate its properties and to carry on its business as conducted as of
the date hereof, except where such failure could not, individually or in the
aggregate, be reasonably expected to have a material adverse effect on the
Company and its subsidiaries, taken as a whole; and neither the Company nor any
such subsidiary has received any actual notice of any proceeding relating to
revocation or modification of any such license, permit, certificate, consent,
order, approval or other authorization, except as disclosed in the Registration
Statement and the Prospectus or where such revocation or modification,
individually or in the aggregate, could not reasonably be expected to have a
material adverse effect on the Company and its subsidiaries, taken as a whole;
and each of the Company and its subsidiaries is in compliance with all laws,
statutes and judgments, orders, rules or regulations of any court or arbitrator
or governmental or regulatory authority relating to the conduct of its business
as conducted as of the date hereof, except where such noncompliance could not,
individually or in the aggregate, be reasonably expected to result in a material
adverse effect on the Company and its subsidiaries, taken as a whole;
(aa) there are no existing or, to the best knowledge of the Company,
threatened labor disputes with the employees of the Company or any of its
subsidiaries which are likely to have a material adverse effect on the Company
and its subsidiaries, taken as a whole;
(bb) the Company and its subsidiaries (i) are in compliance with any
and all applicable foreign, federal, state and local laws, rules, regulations,
orders, decisions and directives relating to the protection of human health and
safety, the environment or hazardous or toxic materials, substances or wastes,
pollutants or contaminants ("Environmental Laws"), (ii) have received all
permits, licenses or other approvals required of them under applicable
Environmental Laws to conduct their respective businesses, (iii) are in
compliance with all terms and conditions of any such permit, license or approval
and (iv) are aware of no conditions relating to hazardous or toxic materials,
substances or wastes, pollutants or contaminants on any property or facility
currently or formerly owned or operated by the Company or any of its
subsidiaries that could reasonably be expected to require investigation,
remediation or monitoring under Environmental Laws, except where such
noncompliance with Environmental Laws, failure to receive required permits,
licenses or other approvals, failure to comply with the terms and conditions of
such permits, licenses or approvals or investigation, remediation or monitoring
would not, individually or in the aggregate, have a material adverse effect on
the Company and its subsidiaries, taken as a whole;
(cc) in the ordinary course of its business, the Company conducts a
periodic review of the effect of Environmental Laws on the business, operations
and properties of the Company and its subsidiaries, in the course of which it
identifies and evaluates associated costs and liabilities (including, without
limitation, any capital or operating expenditures required for clean-up, closure
of properties or compliance with Environmental Laws or any permit, license or
approval, any related constraints on operating activities and any potential
liabilities to third parties), and, on the basis of such review, the Company has
reasonably concluded that such associated costs and liabilities would not,
individually or in the aggregate, have a material adverse effect on the Company
and its subsidiaries, taken as a whole;
(dd) with respect to each employee benefit plan (within the meaning of
Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended
("ERISA")) that is maintained, administered or contributed to by the Company or
any other person or entity that, together with the Company, is treated as a
single employer under Section 414 of the Internal Revenue Code of 1986, as
amended (the "Code") (each such person or entity, an "ERISA Affiliate"), the
Company, each such ERISA Affiliate and each such plan complies in all material
respects with all applicable statutes, orders, rules and regulations, including
but not limited to ERISA and the Code, and each such plan has been administered
and operated in accordance with its terms; none of the Company or any of its
ERISA Affiliates has incurred any material liability to any such plan (including
any multiemployer plan (within the meaning of Section 3(37) of ERISA)) or to the
Pension Benefit Guaranty Corporation that has not been fully paid; no prohibited
transaction, within the meaning of Section 406 of ERISA or Section 4975 of the
Code, has occurred with respect to any such plan, excluding transactions
effected pursuant to a statutory or administrative exemption, and no reportable
event (within the meaning of Section 4043 of ERISA) has occurred for which the
30-day reporting requirement has not been waived; and for each such plan which
is subject to the funding rules of Section 412 of the Code or Section 302 of
ERISA, no "accumulated funding deficiency" as defined in Section 412 of the Code
has been incurred, whether or not waived, and, except as disclosed in the
Prospectus, the fair market value of the assets of each such plan (excluding for
these purposes accrued but unpaid contributions)
exceeded the present value of all benefits accrued under such plan determined
using reasonable actuarial assumptions;
(ee) the Company and its subsidiaries maintain systems of internal
accounting controls sufficient to provide reasonable assurance that (i)
transactions are executed in accordance with management's general or specific
authorizations, (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally accepted
accounting principles and to maintain asset accountability, (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
the existing assets at reasonable intervals and appropriate action is taken with
respect to any differences;
(ff) there is and has been no failure on the part of the Company or its
subsidiaries or, to the Company's knowledge, any of the directors or officers of
the Company or its subsidiaries, in their capacities as such, to comply with any
provision of the Xxxxxxxx-Xxxxx Act of 2002 and the rules and regulations
promulgated in connection therewith (the "Xxxxxxxx-Xxxxx Act"), including
Section 402 related to loans and Sections 302 and 906 related to certifications;
(gg) the Company and its subsidiaries have insurance covering their
respective properties, operations, personnel and businesses, including business
interruption insurance, which insurance is in amounts and insures against such
losses and risks as are, in the judgment of the Company, appropriate to protect
the Company and its subsidiaries and their respective businesses; and neither
the Company nor any of its subsidiaries has (i) received notice from any insurer
or agent of such insurer that capital improvements or other expenditures are
required or necessary to be made in order to continue such insurance or (ii) any
reason to believe that it will not be able to renew, to the extent that, in its
judgment, it determines to be appropriate, its existing insurance coverage as
and when such coverage expires or to obtain similar coverage, to the extent
that, in its judgment, it determines to be appropriate, at reasonable cost from
similar insurers as may be necessary to continue its business;
(hh) neither the Company nor any of its subsidiaries nor, to the best
knowledge of the Company, any director, officer, agent, employee or other person
associated with or acting on behalf of the Company or any of its subsidiaries
has (i) used any corporate funds for any unlawful contribution, gift,
entertainment or other unlawful expense relating to political activity, (ii)
made any direct or indirect unlawful payment to any foreign or domestic
government official or employee from corporate funds, (iii) violated or is in
violation of any provision of the Foreign Corrupt Practices Act of 1977, or (iv)
made any bribe, rebate, payoff, influence payment, kickback or other unlawful
payment; and
(ii) nothing has come to the attention of the Company that has caused
the Company to believe that the industry, statistical and market-related data
included in the Prospectus is not based on or derived from sources that are
reliable and accurate in all material respects.
4. The Company covenants and agrees with each of the several
Underwriters as follows:
(a) to file the final Prospectus with the Commission within the time
periods specified by Rule 424(b) and Rule 430A under the Securities Act and to
file promptly all reports and any definitive proxy or information statements
required to be filed by the Company with the Commission pursuant to Section
13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to the date of the
Prospectus and for so long as the delivery of a prospectus is required in
connection with the offering or sale of the Shares; and to furnish copies of the
Prospectus to the Underwriters in New York City prior to 10:00 a.m., New York
City time, on the Business Day next succeeding the date of this Agreement in
such quantities as the Underwriters may reasonably request;
(b) to deliver, at the expense of the Company, to the Representative
four signed copies of the Registration Statement (as originally filed) and each
amendment thereto, in each case including exhibits and documents incorporated by
reference therein, and to each other Underwriter a conformed copy of the
Registration Statement (as originally filed) and each amendment thereto, in each
case without exhibits but including the documents incorporated by reference
therein and, during the period mentioned in paragraph (e) below, to each of the
Underwriters as many copies of the Prospectus (including all amendments and
supplements thereto) and documents incorporated by reference therein as the
Underwriters may reasonably request;
(c) before filing any amendment or supplement to the Registration
Statement or the Prospectus, whether before or after the time the Registration
Statement becomes effective, to furnish to the Representative and counsel for
the Underwriters a copy of the proposed amendment or supplement for review and
not to file any such proposed amendment or supplement to which the
Representative reasonably objects;
(d) to advise the Representative promptly, and to confirm such advice
in writing (i) when the Rule 462 Registration Statement has become effective, if
applicable, (ii) when any amendment to the Registration Statement has been filed
or becomes effective, (iii) when any supplement to the Prospectus or any amended
Prospectus has been filed and to furnish the Underwriters with a reasonable
number of copies thereof, (iv) of any request by the Commission for any
amendment to the Registration Statement or any amendment or supplement to the
Prospectus or the receipt of any comments from the Commission relating to the
Registration Statement or any other request by the Commission for any additional
information, (v) 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 the Prospectus or the
initiation or threatening of any proceeding for that purpose, (vi) of the
occurrence of any event, within the period referenced in paragraph (e) below, as
a result of which the Prospectus as then amended or supplemented would include
an untrue statement of a material fact or omit to state any material fact
necessary in order to make the statements therein, in the light of the
circumstances when the Prospectus is delivered to a purchaser, not misleading,
and (vii) of the receipt by the Company of any notification with respect to any
suspension of the qualification of the Shares for offer and sale in any
jurisdiction or the initiation or threatening of any proceeding for such
purpose; and to use its best efforts to prevent the issuance of any such
stop order, or of any order preventing or suspending the use of any preliminary
prospectus or the Prospectus, or of any order suspending any such qualification
of the Shares, or notification of any such order thereof and, if issued, to
obtain as soon as possible the withdrawal thereof;
(e) if, during such period of time after the first date of the public
offering of the Shares as in the opinion of counsel for the Underwriters a
prospectus relating to the Shares is required by law to be delivered in
connection with sales by the Underwriters or any dealer, any event shall occur
or condition shall exist as a result of which it is necessary to amend or
supplement the Prospectus in order to make the statements therein, in the light
of the circumstances when the Prospectus is delivered to a purchaser, not
misleading, or if it is necessary to amend or supplement the Prospectus to
comply with law, forthwith to prepare and furnish, at the expense of the
Company, to the Underwriters and to the dealers (whose names and addresses the
Underwriters will furnish to the Company) to which Shares may have been sold by
the Underwriters on behalf of the Underwriters and to any other dealers upon
request, such amendments or supplements to the Prospectus as may be necessary so
that the statements in the Prospectus as so amended or supplemented will not, in
the light of the circumstances when the Prospectus is delivered to a purchaser,
be misleading or so that the Prospectus will comply with law;
(f) to endeavor to qualify the Shares for offer and sale under the
securities or Blue Sky laws of such jurisdictions as the Underwriters shall
reasonably request and to continue such qualification in effect so long as
reasonably required for distribution of the Shares; provided that the Company
shall not be required to qualify to do business in any jurisdiction where it is
not so qualified or to file a general consent to service of process in any
jurisdiction;
(g) to make generally available to its security holders and to the
Underwriters as soon as practicable (but not later than (i) the 45th day after
the end of the fourth fiscal quarter following the fiscal quarter that includes
the effective date of the Registration Statement, or (ii) if such fourth fiscal
quarter is the last quarter of the Company's fiscal year, the 90th day after the
end of such fourth fiscal quarter) an earnings statement covering a period of at
least twelve months beginning with the first fiscal quarter of the Company
occurring after the effective date of the Registration Statement, which shall
satisfy the provisions of Section 11(a) of the Securities Act and Rule 158 of
the Commission promulgated thereunder;
(h) so long as the Shares are outstanding (but not longer than three
years after the date hereof), to furnish to the Underwriters copies of all
reports or other communications (financial or other) furnished to holders of the
Shares, and copies of any reports and financial statements furnished to or filed
with the Commission or any national securities exchange;
(i) for a period of 90 days after the date of the final Prospectus
relating to the Shares, not to (i) offer, pledge, announce the intention to
sell, sell, contract to sell, sell any option or contract to purchase, purchase
any option or contract to sell, grant any option, right or warrant to purchase
or otherwise transfer or dispose of, directly or indirectly, any shares of Stock
or any securities convertible into or exercisable or exchangeable for Stock or
(ii) enter into any swap or other agreement that transfers, in whole or in part,
any of the economic consequences of ownership of the Stock, whether any such
transaction described in clause (i) or (ii) above is to be
settled by delivery of Stock or such other securities, in cash or otherwise
without the prior written consent of X. X. Xxxxxx Securities Inc., other than
(i) the sale and issuance of the Shares to be sold hereunder, (ii)
contributions, sales and issuances of Stock to the Company's employee benefits
protection and deferred compensation trusts or under the Company's employee
savings plan in the ordinary course, (iii) grants of stock options and other
awards under the Company's employee and director equity incentive plans in the
ordinary course or as otherwise described in the Prospectus, (iv) sales and
issuances of Stock upon the exercise of stock options and other awards granted
prior to the date hereof or as permitted by the preceding clause (iii), and (v)
filing of registration statements relating to Stock described in the preceding
clauses (ii), (iii) and (iv);
(j) to use the net proceeds received by the Company from the sale of
the Shares pursuant to this Agreement in the manner specified in the Prospectus
under the caption "Use of Proceeds";
(k) not to take, directly or indirectly, any action designed to or that
could reasonably be expected to cause or result in any stabilization or
manipulation of the price of the Shares;
(l) to use its best efforts to list, subject to notice of issuance, the
Shares on the New York Stock Exchange (the "Exchange");
(m) whether or not the transactions contemplated in this Agreement are
consummated or this Agreement is terminated, to pay or cause to be paid all
costs and expenses incident to the performance of its obligations hereunder,
including, without limiting the generality of the foregoing, all costs and
expenses (i) incident to the preparation, issuance, execution and delivery of
the Shares, (ii) incident to the preparation, printing and filing under the
Securities Act of the Registration Statement, the Prospectus and any preliminary
prospectus (including in each case all exhibits, amendments and supplements
thereto), (iii) incurred in connection with the registration or qualification of
the Shares under the laws of such jurisdictions as the Underwriters may
designate (including reasonable fees of counsel for the Underwriters and its
disbursements), (iv) in connection with the listing of the Shares on the
Exchange, (v) related to the filing with, and clearance of the offering by, the
National Association of Securities Dealers, Inc., (vi) in connection with the
printing (including word processing and duplication costs) and delivery of this
Agreement, and the Preliminary and Supplemental Blue Sky Memoranda and the
furnishing to the Underwriters and dealers of copies of the Registration
Statement and the Prospectus, including mailing and shipping, as herein
provided, (vii) any expenses incurred by the Company in connection with a "road
show" presentation to potential investors, (viii) the cost of preparing stock
certificates and (ix) the cost and charges of any transfer agent and any
registrar.
5. The several obligations of the Underwriters hereunder to purchase
the Shares on the Closing Date or the Additional Closing Date, as the case may
be, are subject to the performance by the Company of its obligations hereunder
and to the following additional conditions:
(a) the Registration Statement shall have become effective (or if a
post-effective amendment is required to be filed under the Securities Act, such
post-effective amendment shall
have become effective) not later than 5:00 P.M., New York City time, on the date
hereof; and no stop order suspending the effectiveness of the Registration
Statement or any post-effective amendment shall be in effect, and no proceedings
for such purpose shall be pending before or threatened by the Commission; the
Prospectus shall have been filed with the Commission pursuant to Rule 424(b)
within the applicable time period prescribed for such filing by the rules and
regulations under the Securities Act and in accordance with Section 4(a) hereof;
and all requests for additional information shall have been complied with to the
satisfaction of the Underwriters;
(b) the representations and warranties of the Company contained herein
are true and correct on and as of the Closing Date or the Additional Closing
Date, as the case may be, as if made on and as of the Closing Date or the
Additional Closing Date, as the case may be, and the Company shall have complied
with all agreements and all conditions on its part to be performed or satisfied
hereunder at or prior to the Closing Date or the Additional Closing Date, as the
case may be;
(c) subsequent to the execution and delivery of this Agreement and
prior to the Closing Date or the Additional Closing Date, as the case may be,
there shall not have occurred any downgrading, nor shall any notice have been
given of (i) any downgrading, (ii) any intended or potential downgrading or
(iii) any review or possible change that does not indicate an improvement, in
the rating accorded any securities of or guaranteed by the Company by any
"nationally recognized statistical rating organization", as such term is defined
for purposes of Rule 436(g)(2) under the Securities Act;
(d) since the date of the latest audited financial statements included
or incorporated by reference in the Prospectus there shall not have been any
change in the capital stock or long-term debt of the Company or any of its
subsidiaries or any material adverse change, or any development involving a
prospective material adverse change, in or affecting the condition (financial or
other), business, properties, management, financial position, stockholders'
equity, or results of operations of the Company and its subsidiaries, taken as a
whole, otherwise than as disclosed or contemplated in the Prospectus, the effect
of which in your judgment makes it impracticable or inadvisable to proceed with
the public offering or the delivery of the Shares on the Closing Date or the
Additional Closing Date, as the case may be, on the terms and in the manner
contemplated in the Prospectus; and neither the Company nor any of its
subsidiaries has sustained since the date of the latest audited financial
statements included or incorporated by reference in the Prospectus any material
loss or interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor dispute or
court or governmental action, order or decree, otherwise than as disclosed or
contemplated in the Prospectus;
(e) the Underwriters shall have received on and as of the Closing Date
or the Additional Closing Date, as the case may be, a certificate of the chief
financial officer or the chief accounting officer of the Company and one
additional senior executive officer of the Company who is reasonably
satisfactory to the Representative, with specific knowledge about the Company's
financial matters, satisfactory to the Underwriters to the effect set forth in
subsections (a) through (d) (with respect to the respective representations,
warranties, agreements
and conditions of the Company) of this Section and to the further effect that
there has not occurred any material adverse change, or any development involving
a prospective material adverse change, in or affecting the condition (financial
or other), business, properties, management, financial position, stockholders'
equity, or results of operations of the Company and its subsidiaries, taken as a
whole, from that disclosed or contemplated in the Registration Statement;
(f) Xxxxxx Xxxx & Xxxxxx LLP, counsel for the Company, shall have
furnished to the Underwriters their written opinion, dated the Closing Date or
the Additional Closing Date, as the case may be, in form and substance
satisfactory to the Representative, to the effect that:
(i) the Company has been duly incorporated and is validly existing
as a corporation in good standing under the laws of the State of Delaware, with
corporate power and authority to own its properties and conduct its business as
described in the Prospectus;
(ii) the Company has been duly qualified as a foreign corporation
for the transaction of business and is in good standing under the laws of each
other jurisdiction in which it owns or leases properties, or conducts business,
so as to require such qualification, other than where the failure to be so
qualified or in good standing would not have a material adverse effect on the
Company and its subsidiaries, taken as a whole;
(iii) each of the Company's domestic subsidiaries has been duly
incorporated and is validly existing as a corporation under the laws of its
jurisdiction of incorporation with appropriate power and authority to own its
properties and conduct its business as described in the Prospectus and has been
duly qualified as a foreign corporation for the transaction of business and is
in good standing under the laws of each other jurisdiction in which it owns or
leases properties, or conducts business, so as to require such qualification,
other than where the failure to be so qualified and in good standing would not
have a material adverse effect on the Company and its subsidiaries, taken as a
whole;
(iv) such counsel does not know of any statutes, regulations,
contracts or other documents that are required to be described in the
Registration Statement or Prospectus or to be filed as exhibits to the
Registration Statement that are not described or filed as required;
(v) the Amendment has been duly authorized, executed and delivered by
the Company, GrafTech Global and GrafTech Finance and conforms in all material
respects to the description thereof in the Prospectus;
(vi) this Agreement has been duly authorized, executed and delivered
by the Company;
(vii) the authorized capital stock of the Company conforms to the
description thereof contained in the Prospectus;
(viii) the shares of capital stock of the Company outstanding prior
to the issuance of the Shares to be sold by the Company have been duly
authorized and are validly issued, fully paid and non-assessable;
(ix) the Shares to be issued and sold by the Company hereunder have
been duly authorized, and when delivered to and paid for by the Underwriters in
accordance with the terms of this Agreement, will be validly issued, fully paid
and non-assessable and the issuance of the Shares is not subject to any
preemptive or similar rights;
(x) the statements in the Prospectus under "Material U.S. federal tax
consequences for non-U.S. investors" and "Underwriting", the statements in the
Prospectus relating to the Company's common stock under the heading "Description
of Common Stock and Preferred Stock" and incorporated by reference from the
description of the Company's common stock in the Company's registration
statement on Form 8-A dated July 28, 1995, as amended by Amendment No. 1 to such
Form 8-A filed on September 17, 2003, the statements in the Prospectus relating
to the Company's preferred stock purchase rights under the heading "Description
of Common Stock and Preferred Stock" and incorporated by reference from the
description of the Company's preferred stock purchase rights in the Company's
registration statement on Form 8-A dated September 10, 1998, as amended by
Amendment No. 1 to such Form 8-A filed on September 17, 2003, the statements in
the Prospectus relating to the Company's legal proceedings incorporated by
reference from the description of the Company's legal proceedings from Item 3 of
Part 1 of the Company's Annual Report on Form 10-K for the year ended December
31, 2002, as updated by the Company's Quarterly Report on Form 10-Q for the
quarter ended June 30, 2003 and the Prospectus, and the statements in the
Registration Statement under "Indemnification of Directors and Officers" in Item
15, insofar as such statements constitute a summary of the terms of the Stock,
the Preferred Stock, legal matters, documents or proceedings referred to
therein, fairly present in all material respects the information called for with
respect to such terms, legal matters, documents or proceedings;
(xi) such counsel is of the opinion that the Registration Statement
and the Prospectus and any amendments and supplements thereto (other than the
financial statements and related schedules therein, as to which such counsel
need express no opinion) comply as to form in all material respects with the
requirements of the Securities Act and believes that (other than the financial
statements and related schedules therein, as to which such counsel need express
no belief) the Registration Statement and the prospectus included therein at the
time the Registration Statement became effective did not contain any untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not misleading, and
that the Prospectus, as amended or supplemented, if applicable, does not contain
any untrue statement of a material fact or 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;
(xii) no consent, approval, authorization, order, license,
registration or qualification of or with any court or governmental agency or
body is required for the issue and sale of the Shares or the consummation of the
other transactions contemplated by this Agreement, except such consents,
approvals, authorizations, orders, licenses, registrations or
qualifications as have been obtained under the Securities Act and as may be
required under state securities or Blue Sky laws in connection with the purchase
and distribution of the Shares by the Underwriters;
(xiii) the Company is not and, after giving effect to the offering
and sale of the Shares, will not be an "investment company" or entity
"controlled" by an "investment company", as such terms are defined in the
Investment Company Act;
(xiv) the documents incorporated by reference in the Prospectus or
any further amendment or supplement thereto made by the Company prior to the
Closing Date or the Additional Closing Date, as the case may be (other than the
financial statements and related schedules therein, as to which such counsel
need express no opinion), when they became effective or were filed with the
Commission, as the case may be, complied as to form in all material respects
with the requirements of the Securities Act or the Exchange Act, as applicable,
and the rules and regulations of the Commission thereunder; and they have no
reason to believe that any of such documents, when such documents became
effective or were so filed, as the case may be, contained, in the case of a
registration statement which became effective under the Securities Act, 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, in the case of other documents which were filed with the Commission under
the Exchange Act, an untrue statement of a material fact or omitted to state a
material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made when such documents were so filed,
not misleading; and
(xv) the Rights Agreement has been duly authorized, executed and
delivered by the Company; the Rights have been duly authorized by the Company
and, when issued upon issuance of the Shares, will be validly issued, and the
Preferred Stock has been duly authorized by the Company and validly reserved for
issuance and, when issued upon exercise in accordance with the terms of the
Rights Agreement, will be validly issued, fully paid and non-assessable.
In rendering such opinions, such counsel may rely: (A) as to matters
involving the application of laws other than the laws of the United States and
the State of New York and the General Corporation Law of the State of Delaware
to the extent such counsel deems proper and to the extent specified in such
opinion, if at all, upon an opinion or opinions (in form and substance
reasonably satisfactory to Underwriters' counsel) of other counsel reasonably
acceptable to the Underwriters' counsel, familiar with the applicable laws; and
(B) as to matters of fact, to the extent such counsel deems proper, on
certificates of responsible officers of the Company and certificates or other
written statements of officials of jurisdictions having custody of documents
respecting the corporate existence or good standing of the Company. The opinion
of such counsel for the Company shall state that the opinion of any such other
counsel upon which they relied is in form satisfactory to such counsel and, in
such counsel's opinion, the Underwriters and they are justified in relying
thereon. With respect to the matters to be covered in subparagraphs (xi) and
(xiv) above counsel may state that their opinion and belief is based upon their
participation in the preparation of the Registration Statement and the
Prospectus and any document incorporated by reference therein and any amendment
or supplement thereto and
review and discussion of the contents thereof but is without independent check
or verification except as specified.
The opinion of Xxxxxx Xxxx & Xxxxxx LLP described above shall be
rendered to the Underwriters at the request of the Company and shall so state
therein.
(g) Xxxxx X. Xxxxxxx, General Counsel of the Company, shall have
furnished to the Underwriters her written opinion, dated the Closing Date or the
Additional Closing Date, as the case may be, in form and substance satisfactory
to the Underwriters, to the effect that:
(i) each of the Company's foreign subsidiaries has been duly
incorporated and is validly existing as a corporation under the laws of its
jurisdiction of incorporation with appropriate power and authority to own its
properties and conduct its business as described in the Prospectus and has been
duly qualified as a foreign corporation for the transaction of business and is
in good standing under the laws of each other jurisdiction in which it owns or
leases properties, or conducts business, so as to require such qualification,
other than where the failure to be so qualified and in good standing would not
have a material adverse effect on the Company and its subsidiaries, taken as a
whole;
(ii) all of the outstanding shares of capital stock of each
subsidiary have been duly and validly authorized and issued, are fully paid and
non-assessable (or the equivalent thereof under analogous principles of foreign
law in the case of any foreign subsidiary), and (except, in the case of foreign
subsidiaries, for directors' qualifying shares) are owned by the Company,
directly or indirectly, free and clear of all liens, encumbrances, security
interests and claims other than those created by the Security Agreements and in
existence on the Closing Date, except as set forth on the List of Subsidiaries;
(iii) other than as disclosed or contemplated in the Prospectus,
there are no legal or governmental investigations, actions, suits or proceedings
pending or, to the best of such counsel's knowledge, threatened against or
affecting the Company or any of its subsidiaries or any of their respective
properties or to which the Company or of its subsidiaries is or may be a party
or to which any property of the Company or its subsidiaries is or may be the
subject which, if determined adversely to the Company or any of its
subsidiaries, could, individually or in the aggregate, have a material adverse
effect on the condition (financial or other), business, properties, financial
position or results of operations of the Company and its subsidiaries, taken as
a whole; and to the best of such counsel's knowledge, no such proceedings are
threatened or contemplated by governmental authorities or threatened by others;
(iv) neither the Company nor any of its subsidiaries is, or with the
giving of notice or lapse of time or both would be, in violation of or in
default under, its certificate of incorporation, by-laws or any other
organizational document or any indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument known to such counsel to which the
Company or any of its subsidiaries is a party or by which it or any of them or
any of their respective properties is bound, except for violations and defaults
which, individually and in the aggregate, are not material to the Company and
its subsidiaries, taken as a whole;
(v) the issue and sale of the Shares being delivered on the
Closing Date or the Additional Closing Date, as the case may be, and the
performance by the Company of its obligations under this Agreement and the
consummation of the transactions contemplated herein will not (A) conflict with
or result in a breach of any of the terms or provisions of, or constitute a
default under, any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which the Company or any of its subsidiaries is a
party or by which the Company or any of its subsidiaries is bound or to which
any of the property or assets of the Company or any of its subsidiaries is
subject, (B) result in any violation of the provisions of the certificate of
incorporation, by-laws or any other organizational document of the Company or
any of its subsidiaries or (C) result in any violation of any applicable law or
statute or any order, rule or regulation of any court or governmental agency or
body having jurisdiction over the Company, its subsidiaries or any of their
respective properties, except, in the case of clauses (A) and (C), for such
conflicts, breaches, defaults and violations which could not, individually or in
the aggregate, reasonably be expected to have a material adverse effect on the
Company and its subsidiaries, taken as a whole;
(vi) each of the Company and its subsidiaries owns, possesses or has
obtained all licenses, permits, certificates, consents, orders, approvals and
other authorizations from, and has made all declarations and filings with, all
federal, state, local and other governmental authorities (including foreign
regulatory agencies), all self-regulatory organizations and all courts and other
tribunals, domestic or foreign, necessary to own or lease, as the case may be,
and to operate its properties and to carry on its business as conducted as of
the date hereof, except where such failure could not, individually or in the
aggregate, be reasonably expected to result in a material adverse effect on the
Company and its subsidiaries, taken as a whole;
(vii) neither the Company nor any such subsidiary has received any
actual notice of any proceeding relating to revocation or modification of any
such license, permit, certificate, consent, order, approval or other
authorization, except as disclosed in the Registration Statement and the
Prospectus or which, individually or in the aggregate, could not reasonably be
expected to result in a material adverse effect on the Company and its
subsidiaries, taken as a whole;
(viii) each of the Company and its subsidiaries is in compliance with
all laws and regulations relating to the conduct of its business as conducted as
of the date of the Prospectus, except where such noncompliance could not,
individually or in the aggregate, be reasonably expected to result in a material
adverse effect on the Company and its subsidiaries, taken as a whole.
In rendering such opinions, such counsel may rely: (A) as to matters
involving the application of laws other than the laws of the United States and
the State of Connecticut and the General Corporation Law of the State of
Delaware to the extent such counsel deems proper and to the extent specified in
such opinion, if at all, upon an opinion or opinions (in form and substance
reasonably satisfactory to Underwriters' counsel) of other counsel reasonably
acceptable to the Underwriters' counsel, familiar with the applicable laws; and
(B) as to matters of fact to the extent such counsel deems proper, on
certificates of responsible officers of the Company and certificates or other
written statements of officials of jurisdictions having custody
of documents respecting the corporate existence or good standing of the Company.
The opinion of such counsel for the Company shall state that the opinion of any
such other counsel upon which they relied is in form satisfactory to such
counsel and, in such counsel's opinion, the Underwriters and they are justified
in relying thereon.
The opinion of Xxxxx X. Xxxxxxx described above shall be rendered to
the Underwriters at the request of the Company and shall so state therein.
(h) on the date hereof and also on the Closing Date or Additional
Closing Date, as the case may be, KPMG LLP and Deloitte & Touche LLP shall have
furnished to the Representative, at the request of the Company, letters, dated
the respective dates of delivery thereof and addressed to the Underwriters, in
form and substance satisfactory to the Representative, containing statements and
information of the type customarily included in accountants' "comfort letters"
to underwriters with respect to the financial statements and certain financial
information contained in the Registration Statement and the Prospectus;
(i) the Underwriters shall have received on and as of the Closing Date
or Additional Closing Date, as the case may be, an opinion of Cravath, Swaine &
Xxxxx LLP, counsel to the Underwriters, with respect to the due authorization
and valid issuance of the Shares, the Registration Statement, the Prospectus and
other related matters as the Underwriters may reasonably request, and such
counsel shall have received such papers and information as they may reasonably
request to enable them to pass upon such matters;
(j) the Shares to be delivered on the Closing Date or Additional
Closing Date, as the case may be, shall have been approved for listing on the
New York Stock Exchange, subject to official notice of issuance;
(k) on or prior to the Closing Date or Additional Closing Date, as the
case may be, the Company shall have furnished to the Underwriters such further
certificates and documents as the Underwriters shall reasonably request;
(l) the Amendment shall be in full force and effect and the
Underwriters shall have received true and correct copies of all documents
pertaining thereto and evidence reasonably satisfactory to counsel for the
Underwriters of the effectiveness thereof; and
(m) the "lock-up" agreements, each substantially in the form of Exhibit
A hereto, between you and certain officers and directors of the Company relating
to sales and certain other dispositions of shares of Stock or certain other
securities, delivered to you on or before the date hereof, shall be in full
force and effect on the Closing Date or Additional Closing Date, as the case may
be.
All opinions, letters, certificates and evidence mentioned above or
elsewhere in this Agreement shall be deemed to be in compliance with the
provisions hereof only if they are in form and substance reasonably satisfactory
to counsel for the Underwriters.
6. The Company agrees to indemnify and hold harmless each Underwriter,
each affiliate of any Underwriter which assists such Underwriter in the
distribution of the Shares and each person, if any, who controls any Underwriter
within the meaning of either Section 15 of the Securities Act or Section 20 of
the Exchange Act, from and against any and all losses, claims, damages and
liabilities (including, without limitation, the legal fees and other expenses
incurred in connection with any suit, action or proceeding or any claim
asserted) that arise out of or are based upon any untrue statement or alleged
untrue statement of a material fact contained in the Registration Statement or
the Prospectus (as amended or supplemented if the Company shall have furnished
any amendments or supplements thereto) or any related preliminary prospectus, or
arise out of or are based upon any omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make the
statements therein (in the case of the Prospectus, in light of the circumstances
under which they were made) not misleading, except insofar as such losses,
claims, damages or liabilities are caused by any untrue statement or omission or
alleged untrue statement or omission made in reliance upon and in conformity
with information relating to any Underwriter furnished to the Company in writing
by such Underwriter expressly for use therein; provided, that with respect to
any untrue statement or alleged untrue statement in or omission or alleged
omission from any preliminary prospectus the indemnity agreement contained in
this paragraph shall not inure to the benefit of any Underwriter from whom the
person asserting any such losses, claims, damages or liabilities purchased the
Shares concerned, to the extent that a prospectus relating to such Shares was
required to be delivered by such Underwriter under the Act in connection with
such purchase and any such loss, claim, damage or liability of such Underwriter
results from the fact that there was not sent or given to such person, at or
prior to the written confirmation of the sale of such Shares to such person, a
copy of the Prospectus correcting such untrue statement or alleged untrue
statement or such omission or alleged omission if the Company had previously
furnished copies thereof to such Underwriter.
Each Underwriter agrees, severally and not jointly, to indemnify and
hold harmless the Company, its directors, its officers who sign the Registration
Statement and each person who controls the Company within the meaning of Section
15 of the Securities Act and Section 20 of the Exchange Act to the same extent
as the foregoing indemnity from the Company to each Underwriter, but only with
reference to information relating to such Underwriter furnished to the Company
in writing by such Underwriter expressly for use in the Registration Statement,
the Prospectus, any amendment or supplement thereto, or any preliminary
prospectus.
If any suit, action, proceeding (including any governmental or
regulatory investigation), claim or demand shall be brought or asserted against
any person in respect of which indemnity may be sought pursuant to either of the
two preceding paragraphs, such person (the "Indemnified Person") shall promptly
notify the person against whom such indemnity may be sought (the "Indemnifying
Person") in writing, but the omission to so notify the Indemnifying Person will
not relieve it from any liability which it may have to any Indemnified Person
except to the extent it is materially prejudiced by such failure and the
Indemnifying Person, upon request of the Indemnified Person, shall retain
counsel reasonably satisfactory to the Indemnified Person to represent the
Indemnified Person and any others the Indemnifying Person may designate in such
proceeding and shall pay the fees and expenses of such counsel related to such
proceeding. In any
such proceeding, any Indemnified Person shall have the right to retain its own
counsel, but the fees and expenses of such counsel shall be at the expense of
such Indemnified Person unless (i) the Indemnifying Person and the Indemnified
Person shall have mutually agreed to the contrary, (ii) the Indemnifying Person
has failed within a reasonable time to retain counsel reasonably satisfactory to
the Indemnified Person or (iii) the named parties in any such proceeding
(including any impleaded parties) include both the Indemnifying Person and the
Indemnified Person and representation of both parties by the same counsel would
be inappropriate due to actual or potential differing interests between them. It
is understood that the Indemnifying Person shall not, in connection with any
proceeding or related proceeding in the same jurisdiction, be liable for the
fees and expenses of more than one separate firm (in addition to any local
counsel) for all Indemnified Persons, and that all such fees and expenses shall
be reimbursed as they are incurred. Any such separate firm for the Underwriters,
each affiliate of any Underwriter which assists such Underwriter in the
distribution of the Shares and such control persons of Underwriters shall be
designated in writing by X.X. Xxxxxx Securities Inc. and any such separate firm
for the Company, its directors, its officers who sign the Registration Statement
and such control persons of the Company shall be designated in writing by the
Company. The Indemnifying Person shall not be liable for any settlement of any
proceeding effected without its written consent, but if settled with such
consent or if there be a final judgment for the plaintiff, the Indemnifying
Person agrees to indemnify any Indemnified Person from and against any loss or
liability by reason of such settlement or judgment. Notwithstanding the
foregoing sentence, if at any time an Indemnified Person shall have requested an
Indemnifying Person to reimburse the Indemnified Person for fees and expenses of
counsel as contemplated by the second and third sentences of this paragraph, the
Indemnifying Person agrees that it shall be liable for any settlement of any
proceeding effected without its written consent if (i) such settlement is
entered into more than 30 days after receipt by such Indemnifying Person of the
aforesaid request and (ii) such Indemnifying Person shall not have reimbursed
the Indemnified Person in accordance with such request prior to the date of such
settlement. No Indemnifying Person shall, without the prior written consent of
the Indemnified Person, effect any settlement of any pending or threatened
proceeding in respect of which any Indemnified Person is or could have been a
party and indemnity could have been sought hereunder by such Indemnified Person,
unless such settlement includes an unconditional release of such Indemnified
Person from all liability on claims that are the subject matter of such
proceeding and does not include a statement as to, or an admission of fault,
culpability or failure to act by or on behalf of an Indemnified Party.
If the indemnification provided for in the first and second paragraphs
of this Section 6 is unavailable to an Indemnified Person or insufficient in
respect of any losses, claims, damages or liabilities referred to therein, then
each Indemnifying Person under such paragraph, in lieu of indemnifying such
Indemnified Person thereunder, shall contribute to the amount paid or payable by
such Indemnified Person as a result of such losses, claims, damages or
liabilities (i) in such proportion as is appropriate to reflect the relative
benefits received by the Company on the one hand and the Underwriters on the
other hand from the offering of the Shares or (ii) if the allocation provided by
clause (i) above is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause (i)
above but also the relative fault of the Company on the one hand and the
Underwriters on the other hand in connection with the statements or omissions
that resulted in such losses, claims, damages or
liabilities, as well as any other relevant equitable considerations. The
relative benefits received by the Company on the one hand and the Underwriters
on the other hand shall be deemed to be in the same respective proportions as
the net proceeds from the offering (before deducting expenses) received by the
Company and the total underwriting discounts and the commissions received by the
Underwriters, in each case as set forth in the table on the cover of the
Prospectus, bear to the aggregate public offering price of the Shares. The
relative fault of the Company on the one hand and the Underwriters on the other
hand shall be determined by reference to, among other things, whether the untrue
or alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by the Company
or by the Underwriters and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 6 were determined by pro rata
allocation (even if the Underwriters were treated as one entity for such
purposes) or by any other method of allocation that does not take account of the
equitable considerations referred to in the immediately preceding paragraph. The
amount paid or payable by an Indemnified Person as a result of the losses,
claims, damages and liabilities referred to in the immediately preceding
paragraph shall be deemed to include, subject to the limitations set forth
above, any legal or other expenses incurred by such Indemnified Person in
connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 6, in no event shall an
Underwriter be required to contribute any amount in excess of the amount by
which the total price at which the Shares underwritten by it and distributed to
the public were offered to the public exceeds the amount of any damages that
such Underwriter has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The Underwriters' obligations to
contribute pursuant to this Section 6 are several in proportion to the
respective number of Shares set forth opposite their names in Schedule I hereto,
and not joint.
The remedies provided for in this Section 6 are not exclusive and shall
not limit any rights or remedies which may otherwise be available to any
indemnified party at law or in equity.
The indemnity and contribution agreements contained in this Section 6
and the representations and warranties of the Company set forth in this
Agreement shall remain operative and in full force and effect regardless of (i)
any termination of this Agreement, (ii) any investigation made by or on behalf
of any Underwriter or any person controlling any Underwriter or by or on behalf
of the Company, its officers or directors or any other person controlling the
Company and (iii) acceptance of and payment for any of the Shares.
7. Notwithstanding anything herein contained, this Agreement (or the
obligations of the several Underwriters with respect to the Option Shares) may
be terminated in the absolute discretion of the Representative, by notice given
to the Company, if after the execution and delivery of this Agreement and prior
to the Closing Date (or, in the case of the Option Shares, prior to the
Additional Closing Date) (i) trading generally shall have been suspended or
materially limited on or by, as the case may be, any of the New York Stock
Exchange, the American Stock Exchange, the National Association of Securities
Dealers, Inc., the Chicago Board Options Exchange, the Chicago Mercantile
Exchange or the Chicago Board of Trade, (ii) trading of any securities of or
guaranteed by the Company shall have been suspended on any exchange or in any
over-the-counter market, (iii) a general moratorium on commercial banking
activities in New York shall have been declared by either Federal or New York
State authorities, or (iv) there shall have occurred any outbreak or escalation
of hostilities or any change in financial markets or any calamity or crisis
that, in the judgment of the Representative, is material and adverse and which,
in the judgment of the Representative, makes it impracticable or inadvisable to
proceed with the offering, sale or delivery of the Shares being delivered at the
Closing Date (or the Additional Closing Date, as applicable) on the terms and in
the manner contemplated in the Prospectus.
8. This Agreement shall become effective upon the later of (x)
execution and delivery hereof by the parties hereto and (y) release of
notification of the effectiveness of the Registration Statement (or, if
applicable, any post-effective amendment) by the Commission.
If on the Closing Date or the Additional Closing Date, as the case may
be, any one or more of the Underwriters shall fail or refuse to purchase Shares
which it or they have agreed to purchase hereunder on such date, and the
aggregate number of Shares which such defaulting Underwriter or Underwriters
agreed but failed or refused to purchase is not more than one-tenth of the
aggregate number of Shares to be purchased on such date, the other Underwriters
shall be obligated severally in the proportions that the number of Shares set
forth opposite their respective names in Schedule I bears to the aggregate
number of Underwritten Shares set forth opposite the names of all such
non-defaulting Underwriters, or in such other proportions as the Underwriters
may specify, to purchase the Shares which such defaulting Underwriter or
Underwriters agreed but failed or refused to purchase on such date; provided
that in no event shall the number of Shares that any Underwriter has agreed to
purchase pursuant to Section 2 be increased pursuant to this Section 8 by an
amount in excess of one-tenth of such number of Shares without the written
consent of such Underwriter. If on the Closing Date or the Additional Closing
Date, as the case may be, any Underwriter or Underwriters shall fail or refuse
to purchase Shares which it or they have agreed to purchase hereunder on such
date, and the aggregate number of Shares with respect to which such default
occurs is more than one-tenth of the aggregate number of Shares to be purchased
on such date, and arrangements satisfactory to the Underwriters and the Company
for the purchase of such Shares are not made within 36 hours after such default,
this Agreement (or the obligations of the several Underwriters to purchase the
Option Shares, as the case may be) shall terminate without liability on the part
of any non-defaulting Underwriter or the Company. In any such case either you or
the Company shall have the right to postpone the Closing Date (or, in the case
of the Option Shares, the Additional Closing Date), but in no event for longer
than seven days, in order that the required changes, if any, in the Registration
Statement and in the Prospectus or in any other documents or arrangements may be
effected. Any action taken under this paragraph shall not relieve any defaulting
Underwriter from liability in respect of any default of such Underwriter under
this Agreement.
9. If this Agreement shall be terminated by the Underwriters, or any of
them, because of any failure or refusal on the part of the Company to comply
with the terms or to fulfill any of the
conditions of this Agreement, or if for any reason the Company shall be unable
to perform its obligations under this Agreement or any condition of the
Underwriters' obligations cannot be fulfilled, the Company agrees to reimburse
the Underwriters or such Underwriters as have so terminated this Agreement with
respect to themselves, severally, for all out-of-pocket costs and expenses
(including the fees and expenses of its counsel) reasonably incurred by the
Underwriter in connection with this Agreement or the offering contemplated
hereunder; provided that the provisions of this Section 9 shall not apply in the
event this Agreement is terminated by the Underwriters pursuant to Section 7 or
8.
10. This Agreement shall inure to the benefit of and be binding upon
the Company, the Underwriters, each affiliate of any Underwriter which assists
such Underwriter in the distribution of the Shares, any controlling persons
referred to herein and their respective successors and assigns. Nothing
expressed or mentioned in this Agreement is intended or shall be construed to
give any other person, firm or corporation any legal or equitable right, remedy
or claim under or in respect of this Agreement or any provision herein
contained. No purchaser of Shares from any Underwriter shall be deemed to be a
successor by reason merely of such purchase.
11. Any action by the Underwriters hereunder may be taken jointly or by
X.X. Xxxxxx Securities Inc. alone on behalf of the Underwriters, and any such
action taken jointly or by X.X. Xxxxxx Securities Inc. alone shall be binding
upon the Underwriters. 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 Underwriters shall be
given c/o X.X. Xxxxxx Securities Inc., 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000
(telefax: (000) 000-0000); Attention: Syndicate Department. Notices to the
Company shall be given to it at GrafTech International Ltd., Brandywine West,
0000 Xxxxxxx Xxxx, Xxxxx 000, Xxxxxxxxxx, XX 00000 (telefax: (000) 000-0000);
Attention: General Counsel.
12. This Agreement may be signed in counterparts, each of which shall
be an original and all of which together shall constitute one and the same
instrument. No amendment or waiver of any provision of this Agreement, nor any
consent or approval to any departure therefrom, shall in any event be effective
unless the same shall be in writing and signed by the parties hereto.
13. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO THE CONFLICTS
OF LAWS PROVISIONS THEREOF.
If the foregoing is in accordance with your understanding, please sign
and return ten counterparts hereof.
Very truly yours,
GrafTech International Ltd.,
By: /s/ Xxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Vice President, General Counsel,
Human Resources and Secretary
Accepted: October 1, 2003
X.X. Xxxxxx Securities Inc.
Acting on behalf of itself and
the several Underwriters listed
in Schedule I hereto.
By: /s/ Xxxx Xxxxxxxx
------------------------------
Name: Xxxx Xxxxxxxx
Title: Managing Director
SCHEDULE I
Number of Shares
To Be Purchased
Underwriter
X.X. Xxxxxx Securities Inc. 11,450,000
CIBC World Markets Corp. 4,850,000
RBC Xxxx Xxxxxxxx Inc. 2,650,000
Xxxxxxxxx & Company, Inc. 1,545,000
Xxxxxxxxx/Quarterdeck, LLC 5,000
ABN AMRO Rothschild LLC 500,000
Gabelli & Company, Inc. 500,000
Wachovia Capital Markets, LLC 500,000
==========
Total 22,000,000
EXHIBIT A
FORM OF LOCK-UP AGREEMENT
____, 2003
GRAFTECH INTERNATIONAL LTD.
Brandywine West
0000 Xxxxxxx Xxxx, Xxxxx 000
Xxxxxxxxxx, XX 00000
X.X. XXXXXX SECURITIES INC.
[As Representative of the several Underwriters listed in Schedule I to
the Underwriting Agreement referred to below]
c/o X.X. Xxxxxx Securities Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Re: GrafTech International Ltd.--- Public Offering
Ladies and Gentlemen:
The undersigned understands that each of you proposes to enter into an
Underwriting Agreement (the "Underwriting Agreement") by and among GrafTech
International Ltd., a Delaware corporation (the "Company"), and each of the
underwriters mentioned above (the "Underwriters") providing for the public
offering (the "Public Offering") by the Underwriters of common stock, $0.01 per
share par value (the "Common Stock"), of the Company (the "Shares"). Capitalized
terms used herein and not otherwise defined shall have the meanings set forth in
the Underwriting Agreement.
In consideration of the Underwriters' agreement to purchase and make
the Public Offering of the Shares, and for other good and valuable consideration
receipt of which is hereby acknowledged, the undersigned hereby agrees that,
without the prior written consent of X.X. Xxxxxx Securities Inc. on behalf of
the Underwriters, the undersigned will not, during the period ending 90 days
after the date of the final prospectus relating to the Public Offering (the
"Prospectus"), (i) offer, pledge, announce the intention to sell, sell, contract
to sell, sell any option or contract to purchase, purchase any option or
contract to sell, grant any option, right or warrant to purchase, or otherwise
transfer or dispose of, directly or indirectly, any shares of Common Stock or
any securities convertible into or exercisable or exchangeable for Common Stock
(including, without limitation, Common Stock which may be deemed to be
beneficially owned by the undersigned in accordance with the rules and
regulations of the Securities and Exchange Commission and securities which may
be issued upon exercise of a stock option or warrant) or (2) enter into any swap
or other agreement that transfers, in whole or in part, any of the economic
consequences of ownership of the Common Stock, whether any such transaction
described in clause (1) or (2) above is to be settled by delivery of Common
Stock or such other securities, in cash or otherwise. In addition, the
undersigned agrees that, without the prior written consent of X.X. Xxxxxx
Securities Inc. on behalf of the Underwriters, it will not, during the period
ending 90 days after the date of the Prospectus, make any demand for or exercise
any right with
2
respect to, the registration of any shares of Common Stock or any security
convertible into or exercisable or exchangeable for Common Stock.
In furtherance of the foregoing, the Company, and any duly appointed
transfer agent for the registration or transfer of the securities described
herein, are hereby authorized to decline to make any transfer of securities if
such transfer would constitute a violation or breach of this Lock-Up Agreement.
The undersigned hereby represents and warrants that the undersigned has
full power and authority to enter into this Lock-Up Agreement. All authority
herein conferred or agreed to be conferred and any obligations of the
undersigned shall be binding upon the successors, assigns, heirs or personal
representatives of the undersigned.
The undersigned understands that, if the Underwriting Agreement does
not become effective, or if the Underwriting Agreement (other than the
provisions thereof which survive termination) shall terminate or be terminated
prior to payment for and delivery of the Shares to be sold thereunder, the
undersigned shall be released from all obligations under this Lock-Up Agreement.
3
The undersigned understands that the Underwriters are entering into the
Underwriting Agreement and proceeding with the Public Offering in reliance upon
this Lock-Up Agreement.
This Lock-Up Agreement shall be governed by and construed in accordance
with the laws of the State of New York, without regard to the conflict of laws
principles thereof.
Very truly yours,
[NAME OF STOCKHOLDER]
By:
------------------------------
Name:
Title:
Accepted as of the date first set forth above:
X.X. XXXXXX SECURITIES INC.
Acting severally on behalf of themselves.
By: X.X. XXXXXX SECURITIES INC.
By:
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