EXHIIBT 1.1
EXECUTION COPY
6,000,000 Shares of Common Stock
UNITED AUTO GROUP, INC.
UNDERWRITING AGREEMENT
March ___, 2002
BEAR, XXXXXXX & CO. INC.
BANC OF AMERICA SECURITIES LLC
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
XXXXXXXXX XXXXXXXX, INC.
Xxxxxxxx Inc.
as Representatives of the
several Underwriters named in
Schedule I attached hereto
c/o Bear, Xxxxxxx & Co. Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
United Auto Group, Inc., a corporation organized and existing
under the laws of Delaware (the "Company"), and the Selling Stockholders listed
on Schedule II hereto (the "Selling Stockholders"), propose, subject to the
terms and conditions stated herein, to sell to the several underwriters named in
Schedule I hereto (the "Underwriters") an aggregate of 6,000,000 shares (the
"Firm Shares") of the Company's voting common stock, par value $0.0001 per share
(the "Common Stock"). Certain of the Selling Stockholders propose to sell, for
the sole purpose of covering over-allotments in connection with the sale of the
Firm Shares, at the option of the Underwriters, up to an additional 900,000
shares (the "Additional Shares") of Common Stock. The Firm Shares and any
Additional Shares purchased by the Underwriters are referred to herein as the
"Shares." The Shares are more fully described in the Registration Statement
referred to below. We understand that the Company is simultaneously offering its
senior subordinated notes the ("Notes") pursuant to Rule 144A and Regulation S
under the Securities Act of 1933, as amended. The Notes will be sold pursuant to
a purchase agreement (the "Debt Agreement") and issued pursuant to an indenture
(the "Indenture"). In addition, we understand that an indirect wholly-owned
subsidiary of the Company is also offering to purchase all of the outstanding
capital stock of Sytner Group plc (the "Acquisition") pursuant to the Offer
Document, dated as of February 13, 2002 (the "Offer Document").
1. Representations and Warranties of the Company. The
Company represents and warrants to, and agrees with, each of the Underwriters
that:
(a) The Company has filed with the Securities
and Exchange Commission (the "Commission") a registration statement on Form S-3
(No. 333-82264), and amendments thereto, and related preliminary prospectuses
for the registration under the Securities Act of 1933, as amended (the
"Securities Act"), of the Shares which registration statement, as so amended
(including post-effective amendments, if any), has been declared effective by
the Commission and copies of which have heretofore been delivered to the
Underwriters. The registration statement, as amended at the time it became
effective, including the exhibits and information (if any) deemed to be part of
the registration statement at the time of effectiveness pursuant to Rule 430A or
434(d) under the Securities Act, is hereinafter referred to as the "Registration
Statement." If the Company has filed or is required pursuant to the terms hereof
to file a registration statement pursuant to Rule 462(b) under the Securities
Act registering additional shares of Common Stock (a "Rule 462(b) Registration
Statement"), then, unless otherwise specified, any reference herein to the term
"Registration Statement" shall be deemed to include such Rule 462(b)
Registration Statement. Other than a Rule 462(b) Registration Statement, which
became effective upon filing, no other document with respect to the Registration
Statement has heretofore been filed with the Commission. No stop order
suspending the effectiveness of either the Registration Statement or the Rule
462(b) Registration Statement, if any, has been issued and no proceeding for
that purpose has been initiated or threatened by the Commission. The Company, if
required by the Securities Act and rules and regulations of the Commission
(together, the "Rules and Regulations"), proposes to file the Prospectus with
the Commission pursuant to Rule 424(b) of the Rules and Regulations. The
Prospectus, in the form in which it is to be filed with the Commission pursuant
to Rule 424(b) of the Rules and Regulations, or, if the Prospectus is not to be
filed with the Commission pursuant to Rule 424(b), the Prospectus in the form
included as part of the Registration Statement at the time the Registration
Statement became effective, is hereinafter referred to as the "Prospectus,"
except that if any revised prospectus or prospectus supplement shall be provided
to the Underwriters by the Company for use in connection with the offering and
sale of the Shares (the "Offering") which differs from the Prospectus (whether
or not such revised prospectus or prospectus supplement is required to be filed
by the Company pursuant to Rule 424(b) of the Rules and Regulations), the term
"Prospectus" shall refer to such revised prospectus or prospectus supplement, as
the case may be, from and after the time it is first provided to the
Underwriters for such use. Any preliminary prospectus or prospectus subject to
completion included in the Registration Statement, or filed with the Commission
pursuant to Rule 424 under the Securities Act, is hereafter called a
"Preliminary Prospectus." Any reference herein 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 which were filed under the Securities Exchange Act of 1934, as amended
(the "Exchange Act") on or before the effective date of the Registration
Statement, the date of such Preliminary Prospectus or the date of the
Prospectus, as the case may be, and any reference herein to the terms "amend",
"amendment" or "supplement" with respect to the Registration Statement, any
Preliminary Prospectus or the Prospectus shall be deemed to refer to and include
(i) the filing of any document under the Exchange Act after the effective date
of the Registration Statement, the date of such Preliminary Prospectus or the
date of the
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Prospectus, as the case may be, which is incorporated therein by reference and
(ii) any such document so filed. All references in this Agreement to the
Registration Statement, the Rule 462(b) Registration Statement, the Preliminary
Prospectus and the Prospectus, or any amendments or supplements to any of the
foregoing, shall be deemed to include any copy thereof filed with the Commission
pursuant to its Electronic Data Gathering, Analysis and Retrieval System
("XXXXX").
(b) At the time of the effectiveness of the
Registration Statement or the effectiveness of any post-effective amendment to
the Registration Statement, when the Prospectus is first filed with the
Commission pursuant to Rule 424(b) or Rule 434 of the Rules and Regulations,
when any supplement to or amendment of the Prospectus is filed with the
Commission, when any document filed under the Exchange Act was or is filed and
at the Closing Date and the Additional Closing Date, if any (as hereinafter
respectively defined), the Registration Statement and the Prospectus and any
amendments thereof and supplements thereto complied or will comply in all
material respects with the applicable provisions of the Securities Act and the
Rules and Regulations and did not and will not contain an untrue statement of a
material fact and did not and will not omit to state any material fact required
to be stated therein or necessary in order to make the statements therein (i) in
the case of the Registration Statement, not misleading and (ii) in the case of
the Prospectus or any related Preliminary Prospectus, in light of the
circumstances under which they were made, not misleading. When any related
preliminary prospectus was first filed with the Commission (whether filed as
part of the registration statement for the registration of the Shares or any
amendment thereto or pursuant to Rule 424(a) of the Rules and Regulations) and
when any amendment thereof or supplement thereto was first filed with the
Commission, such Preliminary Prospectus and any amendments thereof and
supplements thereto complied in all material respects with the applicable
provisions of the Securities Act and the Rules and Regulations and the Exchange
Act and the respective rules and regulations thereunder and did not contain an
untrue statement of a material fact and did not omit to state any material fact
required to be stated therein or necessary in order to make the statements
therein in light of the circumstances under which they were made not misleading.
No representation and warranty is made in this subsection (b), however, with
respect to any information contained in or omitted from the Registration
Statement or the Prospectus or any related Preliminary Prospectus or any
amendment thereof or supplement thereto in reliance upon and in conformity with
information furnished in writing to the Company by or on behalf of any
Underwriter through you specifically for use therein ("Underwriters'
Information"). The parties acknowledge and agree that the Underwriters'
Information consists solely of the material included in the third paragraph
under the caption "Underwriting" in the Prospectus. If Rule 434 is used, the
Company will comply with the requirements of Rule 434.
(c) Deloitte & Touche LLP, who have certified
the financial statements and supporting schedules included or incorporated in
the Registration Statement or underlying financial information included or
incorporated in the Registration Statement, are independent public accountants
as required by the Securities Act and the Rules and Regulations.
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(d) Subsequent to the respective dates as of
which information is given in the Registration Statement and the Prospectus,
except as set forth in the Registration Statement and the Prospectus, the
Company has not paid any dividends on its capital stock and there has been no
material adverse change or any development involving a prospective material
adverse change on (i) the business, prospects, properties, operations, condition
(financial or other), stockholders' equity (investment) or results of operations
of the Company and each subsidiary of the Company listed on Exhibit 21 of the
Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2001
(the "Subsidiaries"), individually or taken as a whole; (ii) the long-term debt
or floor plan financing of the Company; (iii) the capital stock of the Company;
(iv) the Offering, or anything giving rise to any liability or obligation on the
part of the Underwriters; or (v) the consummation of the transactions
contemplated by this Agreement or the Debt Agreement or the Company's
performance of its obligations hereunder or thereunder or the consummation of
the Acquisition and the transactions contemplated by the Offer Document (a
"Material Adverse Change" or "Material Adverse Effect"), whether or not arising
from transactions in the ordinary course of business, and since the date of the
latest balance sheet presented in the Registration Statement and the Prospectus,
neither the Company nor any of the Subsidiaries has incurred or undertaken any
liabilities or obligations, direct or contingent, or entered into any
transactions which are material to the Company and the Subsidiaries taken as a
whole, except for liabilities or obligations which are reflected in the
Registration Statement and the Prospectus.
(e) This Agreement, the Debt Agreement and the
transactions contemplated herein and therein have been duly and validly
authorized by the Company and this Agreement and the Debt Agreement have been
duly and validly executed and delivered by the Company.
(f) The execution, delivery and performance of
this Agreement and the Debt Agreement, the consummation of the transactions
contemplated hereby and thereby and the consummation of the Acquisition do not
and will not (i) conflict with or result in a breach of any of the terms and
provisions of, or constitute a default (or an event which with notice or lapse
of time, or both, would constitute a default) under, or result in the creation
or imposition of any lien, charge or encumbrance upon any property or assets of
the Company or any of the Subsidiaries pursuant to any indenture, mortgage, deed
of trust, loan agreement or other agreement, instrument, franchise, license or
permit to which the Company or any of the Subsidiaries is a party or by which
the Company or any of the Subsidiaries or their respective properties or assets
may be bound or (ii) violate or conflict with any provision of the certificate
or articles of incorporation, by-laws, certificate of formation, limited
liability company agreement, partnership agreement or other organizational
documents of the Company or any of the Subsidiaries or any judgment, decree,
order, statute, rule or regulation of any court or (assuming compliance with all
applicable state securities and blue sky laws) any public, governmental or
regulatory agency or body having jurisdiction over the Company or any of the
Subsidiaries or any of their respective properties, operations or assets. No
consent, approval, authorization, order, registration, filing, qualification,
license or permit of or with any court or any public, governmental or regulatory
agency or body having
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jurisdiction over the Company or any of the Subsidiaries or any of their
respective properties or assets or from any third party (including without
limitation any automobile manufacturer or distributor, any floorplan lender or
any affiliate of any of the foregoing) is required for the execution, delivery
and performance of this Agreement or the Debt Agreement or the consummation of
the transactions contemplated hereby or thereby, by the Registration Statement
and by the Prospectus, including the issuance, sale and delivery of the Shares
to be issued, sold and delivered by the Company hereunder, or the consummation
of the Acquisition and the transactions contemplated by the Offer Document,
except for the registration under the Securities Act of the Shares, which has
been obtained, and such consents, approvals, authorizations, orders,
registrations, filings, qualifications, licenses and permits as may be required
under state securities or Blue Sky laws in connection with the purchase and
distribution of the Shares by the Underwriters.
(g) The Company has the authorized
capitalization set forth in the Prospectus and all of the issued shares of
capital stock of the Company have been duly and validly authorized and issued,
are fully paid and non-assessable and were not issued in violation of or subject
to any preemptive or similar rights that entitle or will entitle any person to
acquire any Shares from the Company upon issuance or sale by the Company of
Shares in the Offering, except for such rights as may have been fully satisfied
or waived prior to the effectiveness of the Registration Statement; the Shares
to be delivered by the Company on the Closing Date and the Additional Closing
Date, if any (as hereinafter respectively defined), have been duly and validly
authorized and, when delivered by the Company in accordance with this Agreement,
will be duly and validly issued, fully paid and non-assessable and will not have
been issued in violation of or subject to any preemptive or similar rights that
entitle or will entitle any person to acquire any Shares from the Company upon
issuance thereof by the Company; and all of the issued shares of capital stock
of each of its Subsidiaries has been duly and validly authorized and issued and
are fully paid and non-assessable and are owned directly or indirectly by the
Company, free and clear of all liens, encumbrances, equities or claims, other
than liens granted pursuant to the Company's Credit Agreement with
DaimlerChrysler Services North America, LLC; the Common Stock, the Firm Shares
and the Additional Shares conform to the descriptions thereof contained in the
Registration Statement and the Prospectus.
(h) The Subsidiaries are the only subsidiaries
(as defined in Rule 405 of the Securities Act) of the Company. Each of the
Company and the Subsidiaries has been duly organized or formed and is validly
existing as a corporation, partnership or limited liability company in good
standing under the laws of its jurisdiction of incorporation or formation. Each
of the Company and the Subsidiaries is duly qualified to do business and is in
good standing as a foreign corporation, partnership or limited liability company
in each jurisdiction in which the character or location of its properties
(owned, leased or licensed) or the nature or conduct of its business makes such
qualification necessary, except for those failures to be so qualified or in good
standing which will not in the aggregate have a Material Adverse Effect on the
condition (financial or otherwise), results of operations, business, properties
or prospects of the Company and the Subsidiaries taken as a whole. Each of the
Company and the Subsidiaries has all requisite power and authority, and all
necessary consents, approvals, authorizations,
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orders, registrations, qualifications, licenses and permits (collectively, the
"Consents") of and from all public, regulatory or governmental agencies and
bodies, to own, lease and operate its properties and conduct its business as now
being conducted and as described in the Registration Statement and the
Prospectus. No Consent contains a materially burdensome restriction not
adequately disclosed in the Registration Statement and the Prospectus.
(i) Except as described in the Prospectus, there
is no legal or governmental proceeding, including routine litigation, to which
the Company or any of the Subsidiaries is a party or of which any property of
the Company or any of the Subsidiaries is the subject which, singularly or in
the aggregate, if determined adversely to the Company or any of the
Subsidiaries, is reasonably likely to have a Material Adverse Effect, and to the
best of the Company's knowledge, no such proceeding is threatened or
contemplated by governmental authorities or threatened or contemplated by
others, and the defense of all such claims against the Company in the aggregate,
including routine litigation, will not have a Material Adverse Effect on the
Company.
(j) Neither the Company nor any of its
affiliates have taken, nor will any of them take, directly or indirectly, any
action designed to cause or result in, or which constitutes or which might
reasonably be expected to constitute, the stabilization or manipulation of the
price of the shares of Common Stock to facilitate the sale or resale of the
Shares.
(k) Except for the Subsidiaries, the Company
owns no capital stock or other beneficial interest, directly or indirectly, in
any corporation, partnership, joint venture or other business entity, except for
its investments in XxxxXxxxxx.xxx, Inc., FRN of Tulsa, LLC and a 49% interest in
a Toyota dealership in Mexico.
(l) The financial statements, including the
notes thereto, and supporting schedules included or incorporated by reference in
the Registration Statement and the Prospectus present fairly the financial
position of the Company and its consolidated subsidiaries and the other entities
for which financial statements are included in the Registration Statement and
the Prospectus as of the dates indicated and the condition and results of
operations for the periods specified; except as otherwise stated in the
Registration Statement, said financial statements have been prepared in
conformity with generally accepted accounting principles applied on a consistent
basis throughout the periods involved; and the supporting schedules included in
the Registration Statement present fairly the information required to be stated
therein. The other financial and statistical information and data included in
the Registration Statement and the Prospectus present fairly the information
included therein and have been prepared on a basis consistent with that of the
financial statements included or incorporated by reference in the Registration
Statement and the Prospectus and the books and records of the respective
entities presented therein. The pro forma and as adjusted financial information
included in the Prospectus has been properly compiled, and prepared in
accordance with the applicable requirements of the Securities Act and the Rules
and Regulations, and includes all adjustments necessary to present fairly the
pro forma or as adjusted financial position of the respective entity or entities
presented therein at the
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respective dates indicated and the results of their operations for the
respective periods specified. To the best of the Company's knowledge, the
financial information with respect to Sytner Group plc ("Sytner") included in
the Registration Statement and the Prospectus present fairly the financial
position of Sytner as of the date indicated and the condition and results of
operations for the periods specified; said financial information has been
prepared in conformity with generally accepted accounting principals applicable
in the United Kingdom applied on a consistent basis throughout the periods
involved. There are no historical or pro forma financial statements which are
required to be included in the Registration Statement and Prospectus in
accordance with Regulation S-X which have not been included as so required.
(m) The assumptions used in preparing the pro
forma and as adjusted financial information included in each of the Registration
Statement and the Prospectus provide a reasonable basis for presenting the
significant effects directly attributable to the transactions or events
described therein, the related pro forma and as adjusted adjustments give
appropriate effect to those assumptions, and the pro forma and as adjusted
columns therein reflect the proper application of those adjustments to the
corresponding historical financial statement amounts.
(n) Except as disclosed in the Prospectus, no
holder of securities of the Company has any rights to the registration of
securities of the Company because of the filing of the Registration Statement or
otherwise in connection with the sale of the Shares contemplated hereby, and any
such rights so disclosed have either been fully complied with by the Company or
effectively waived by the holders thereof.
(o) The Company is not, and upon consummation of
the transactions contemplated hereby, and at all times up to and including the
application of net proceeds as described in the Prospectus, will not be, subject
to registration as an "investment company" under the Investment Company Act of
1940.
(p) The Company and the Subsidiaries have good
and marketable title in fee simple to all real property and good and marketable
title to all personal property owned by them, in each case free and clear of all
liens, encumbrances and defects except such as are described in the Registration
Statement and the Prospectus or such as do not materially affect the value of
such property by the Company and the Subsidiaries; and any real property and
buildings held under lease or sublease by the Company and the Subsidiaries are
held by them under valid, subsisting and enforceable leases with such exceptions
as are not material and do not interfere with the use made and proposed to be
made of such property and buildings by the Company and the Subsidiaries. Neither
the Company nor any of the Subsidiaries has received any notice of any claim
adverse to their ownership of any real or material personal property or of any
claim against the continued possession of any real property, whether owned or
held under lease or sublease by the Company or any of the Subsidiaries.
(q) The Company and each of the Subsidiaries
have accurately prepared and timely filed all federal, state and other tax
returns that are required to be filed by it and has paid or made provision for
the payment of all taxes, assessments,
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governmental or other similar charges, including without limitation, all sales
and use taxes and all taxes which the Company and each of the Subsidiaries is
obligated to withhold from amounts owed to employees, creditors and third
parties, with respect to the periods covered by such tax returns (whether or not
such amounts are shown as due on any tax return). No deficiency assessment with
respect to a proposed adjustment of the Company's or any of the Subsidiaries'
Federal, state, or other taxes is pending or, to the best of the Company's
knowledge, threatened. There is no tax lien, whether imposed by any federal,
state, or other taxing authority, outstanding against the assets, properties or
business of the Company or any of the Subsidiaries.
(r) The Common Stock is registered pursuant to
Section 12(b) of the Exchange Act and the outstanding shares of Common Stock
(including the Shares) are listed for quotation on the New York Stock Exchange
(the "New York Stock Exchange"), and the Company has taken no action designed
to, or likely to have the effect of, terminating the registration of the Common
Stock under the Exchange Act or de-listing the Common Stock from the New York
Stock Exchange, nor has the Company received any notification that the SEC or
the New York Stock Exchange is contemplating terminating such registration or
listing.
(s) The conditions for use of Form S-3, as set
forth in the General Instructions thereto, have been satisfied.
(t) The documents incorporated or deemed to be
incorporated by reference in the Prospectus, at the time they were or hereafter
are filed with the Commission, complied and will comply in all respects with the
requirements of the Exchange Act and the rules and regulations of the Commission
under the Exchange Act, and, when read together with the other information in
the Prospectus, at the time the Registration Statement and any amendments
thereto become effective and at the Closing Date, will not contain an untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
(u) There are no contracts or other documents
(including, without limitation, any voting agreement), which are required to be
described in the Prospectus or filed as exhibits to the Registration Statement
or the Prospectus by the Securities Act or by the Rules and Regulations and
which have not been so described or filed.
(v) The Company and its Subsidiaries maintain a
system of internal accounting controls sufficient to provide reasonable
assurances that (i) transactions are executed in accordance with management's
general or specific authorizations, (ii) transactions are recorded as necessary
to permit preparation of financial statements in conformity with generally
accepted accounting principles and to maintain accountability for assets, (iii)
access to assets is permitted only in accordance with management's general or
specific authorization, and (iv) the recorded accountability for assets is
compared with existing assets at reasonable intervals and appropriate action is
taken with respect to any differences.
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(w) Neither the Company nor any of the
Subsidiaries (i) is in violation of its charter or by-laws, partnership
agreement, limited liability company agreement or other organizational
documents, (ii) is in default under, and no event has occurred which, with
notice or lapse of time or both, would constitute such a default or result in
the creation or imposition of any lien, charge or encumbrance upon any property
or assets of the Company or any of the Subsidiaries pursuant to, any indenture,
mortgage, deed of trust, loan agreement or other agreement or instrument to
which it is a party or by which it is bound or to which any of its property or
assets is subject or (iii) is in violation in any respect of any statute or any
judgment, decree, order, rule or regulation of any court or governmental or
regulatory agency or body having jurisdiction over the Company or any of the
Subsidiaries or any of their properties or assets, except, in the case of each
of (ii) and (iii), any violation or default that would not have a Material
Adverse Effect on the condition (financial or otherwise), results of operations,
business, properties or prospects of the Company and the Subsidiaries taken as a
whole.
(x) The Company and each of the Subsidiaries
owns or possesses adequate right to use all patents, patent applications,
trademarks, service marks, trade names, trademark registrations, service xxxx
registrations, copyrights, licenses, formulae, customer lists, and know-how and
other intellectual property (including trade secrets and other unpatented and/or
unpatentable proprietary or confidential information, systems or procedures)
necessary for the conduct of their respective businesses as being conducted and
as described in the Registration Statement and Prospectus and have no reason to
believe that the conduct of their respective businesses will conflict with, and
have not received any notice of any claim of conflict with, any such right of
others, except for any failures, claims or conflicts that would not have a
Material Adverse Effect. To the best of the Company's knowledge, all material
technical information developed by and belonging to the Company which has not
been patented has been kept confidential to the extent practicable.
(y) No labor disturbance by the employees of the
Company or any of the Subsidiaries exists or, to the best of the Company's
knowledge, is imminent which might be expected to have a Material Adverse
Effect.
(z) No "prohibited transaction" (as defined in
Section 406 of the Employee Retirement Income Security Act of 1974, as amended,
including the regulations and published interpretations thereunder ("ERISA"), or
Section 4975 of the Internal Revenue Code of 1986, as amended from time to time
(the "Code"), or "accumulated funding deficiency" (as defined in Section 302 of
ERISA) or any of the events set forth in Section 4043(b) of ERISA (other than
events with respect to which the 30-day notice requirement under Section 4043 of
ERISA has been waived) has occurred with respect to any employee benefit plan
which could have a Material Adverse Effect; each employee benefit plan is in
compliance in all material respects with applicable law including ERISA and the
Code; the Company has not incurred and does not expect to incur liability under
Title IV of ERISA with respect to the termination of, or withdrawal from any
"pension plan;" and each "pension plan" (as defined in ERISA) for which the
Company would have any liability that is intended to be qualified under Section
401(a) of
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the Code is so qualified in all material respects and nothing has occurred,
whether by action or by failure to act, which could cause the loss of such
qualification.
(aa) There has been no storage, generation,
transportation, handling, treatment, disposal, discharge, emission, or other
release of any kind of toxic or other wastes or other hazardous substances by,
due to, or caused by the Company (or, to the Company's knowledge, any other
entity for whose acts or omissions the Company is or may be liable) upon any
other property now or previously owned or leased by the Company or any of the
Subsidiaries, or upon any other property, in violation of any statute or any
ordinance, rule, regulation, order, judgment, decree or permit or which would,
under any statute or any ordinance, rule (including rule of common law),
regulation, order, judgment, decree or permit, give rise to any liability,
except for any violation or liability which would not have, singularly or in the
aggregate with all such violations and liabilities, a Material Adverse Effect;
there has been no disposal discharge, emission or other release of any kind onto
such property or into the environment surrounding such property of any toxic or
other wastes or other hazardous substances which could have a Material Adverse
Effect with respect to which the Company or any of the Subsidiaries has
knowledge.
(bb) The Company has not prior to the date hereof
offered or sold any securities which would be "integrated" with the offer and
sale of the Shares pursuant to the Registration Statement.
(cc) No relationship, direct or indirect, exists
between or among any of the Company or any affiliate of the Company, on the one
hand, and any director, officer, stockholder, customer or supplier of any of
them, on the other hand, which is required by the Securities Act or by the Rules
and Regulations to be described in the Registration Statement or the Prospectus
which is not so described or is not described as required.
(dd) The statistical and market-related data
included in the Prospectus are based on or derived from sources which are
reliable and accurate as of the date hereof.
(ee) The representations and warranties of the
Company in the Debt Agreement are true and correct as of the date hereof.
(ff) To the Company's knowledge, the information
about the Acquisition and Sytner which is included in the Prospectus and
Registration Statement is true and complete in all material respects and does
not omit any information necessary to make the information included not
materially misleading.
(gg) The Offer Document does not contain any
material misstatements of fact or any omission of any material fact necessary to
make the statements therein not misleading. The terms of the tender offer for
all of the capital stock of Sytner, the arrangements for the Acquisition and the
financing of the Acquisition comply and have complied with all applicable laws
and requirements (including the
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Financial Services and Markets Xxx 0000, the Companies Act, the City Code and
all applicable U.S. securities and tender offer requirements).
Any certificate signed by or on behalf of the Company and
delivered to the Representatives or to counsel for the Underwriters' shall be
deemed to be a representation and warranty by the Company to each Underwriter as
to the matters covered thereby.
2. Representations and Warranties of the Selling
Stockholders. Each Selling Stockholder severally as to itself and not jointly
represents and warrants to, and agrees with, each of the Underwriters that:
(a) This Agreement has been duly and validly
authorized, executed and delivered by or on behalf of such Selling Stockholder
and is a valid and binding agreement of such Selling Stockholder.
(b) The Custody Agreement (the "Custody
Agreement") signed by (i) such Selling Stockholder and (ii) EquiServe Trust
Company, as custodian (in such capacity, the "Custodian") has been duly and
validly authorized, executed and delivered by such Selling Stockholder and is a
valid and binding agreement of such Selling Stockholder, enforceable against
such Selling Stockholder in accordance with its terms, except as the enforcement
thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or
other similar laws relating to or affecting the rights and remedies of creditors
or by general equitable principles. Such Selling Stockholder agrees that the
Shares and Additional Shares, if any, to be sold by such Selling Stockholder,
whether or not on deposit with the Custodian are subject to the interests of the
Underwriters, that the arrangements made for such custody are to that extent
irrevocable, and that the obligations of such Selling Stockholder hereunder
shall not be terminated, except as provided in this Agreement or in the Custody
Agreement, by any act of such Selling Stockholder, by operation of law or by the
occurrence of any other event. If any event should occur impacting the legal
status or capacity of such Selling Stockholder, before the delivery of the
Shares and the Additional Shares, if any, to be sold by a Selling Stockholder
hereunder, the documents evidencing the Shares and the Additional Shares, if
any, to be sold by such Selling Stockholder then on deposit with the Custodian,
shall be delivered by the Custodian in accordance with the terms and conditions
of this Agreement as if such event had not occurred, regardless of whether or
not the Custodian shall have received notice thereof.
(c) Such Selling Stockholder is or on the
Closing Date will be the lawful owner of the Shares, and is or on the Additional
Closing Date will be the lawful owner of the Additional Shares, if any, to be
sold by such Selling Stockholder hereunder free and clear of all liens,
encumbrances, equities, claims and security interests whatsoever and, assuming
(1) the Underwriters purchase the Shares to be sold by such Selling Stockholder
without notice of any adverse claim (within the meaning of Section 8-105 of the
Uniform Commercial Code of the State of New York (the "NYUCC")), (2) the
Underwriters make payment therefor as provided herein, (3) such Shares are
delivered to the Underwriters in accordance with the provisions of the Custody
- 11 -
Agreement and (4) the Underwriters obtain control of such Shares (within the
meaning of Section 8-106 of the NYUCC), the Underwriters will acquire all of the
Selling Stockholder's rights and interest in the Shares sold by such Selling
Stockholder free of any adverse claim (within the meaning of Section 8-105 of
the NYUCC).
(d) Such Selling Stockholder has the legal
right, power and authority to enter into this Agreement and the applicable
Custody Agreement, to sell, transfer and deliver all of the Shares and
Additional Shares which may be sold by such Selling Stockholder pursuant to this
Agreement and to comply with its other obligations hereunder and thereunder.
(e) No consent, approval, authorization or order
of any court or governmental agency or body or any third party is required for
the consummation by such Selling Stockholder of the transactions contemplated
herein, except such as have been obtained under the Securities Act and such as
may be required under the state securities laws or the blue sky laws of any
jurisdiction or the rules of the NASD in connection with the purchase and
distribution of the Shares and Additional Shares by the Underwriters.
(f) Neither the sale of the Shares and
Additional Shares, if any, being sold by such Selling Stockholder nor the
consummation of any of the other transactions contemplated herein by such
Selling Stockholder or the fulfillment of the terms hereof by such Selling
Stockholder will conflict with, result in a breach or violation of, or
constitute a default under any law, statute, rule or regulation or the terms of
any indenture or other material agreement or instrument to which such Selling
Stockholder is party or bound, or any judgment, order or decree applicable to
such Selling Stockholder of any court or regulatory body, administrative agency,
governmental body or arbitrator having jurisdiction over such Selling
Stockholder.
(g) Such Selling Stockholder does not have any
registration or other similar rights to have any equity or debt securities
registered for sale by the Company under the Registration Statement or included
in the offering of the Shares and the Additional Shares, except for such rights
as have been waived or which are described in the Prospectus (and which have
been complied with).
(h) Such Selling Stockholder does not have, or
has waived prior to the date hereof, any preemptive right, co-sale right or
right of first refusal or other similar right to purchase any of the Shares and
Additional Shares, if any, that are to be sold by the Company to the
Underwriters pursuant to this Agreement; and such Selling Stockholder does not
own any warrants, options or similar rights to acquire, and does not have any
right or arrangement to acquire, any capital stock, right, warrants, options or
other securities from the Company, other than those described in the
Registration Statement and the Prospectus.
(i) All information furnished by or on behalf of
such Selling Stockholder in writing specifically stating that it is for use in
the Registration Statement and Prospectus (the "Selling Stockholder
Information") complies, and on the Closing Date and the Additional Closing Date,
if any, will comply in all material respects with the
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applicable provisions of the Securities Act and the Rules and Regulations, and
does not, and on the Closing Date and the Additional Closing Date, if any, will
not, contain any untrue statement of a material fact or omit to state any
material fact necessary to make such information (i) in the case of the
Registration Statement, not misleading and (ii) in the case of the Prospectus or
any related Preliminary Prospectus, in light of the circumstances under which
they were made, not misleading. To the extent such information appears in the
Prospectus, such Selling Stockholder confirms as accurate the number of shares
of Common Stock set forth opposite such Selling Stockholder's name and the
information described in the related footnote in the Prospectus under the
captions "Selling Stockholders" and "Principal Stockholders" (both prior to and
after giving effect to the sale of the Shares and the Additional Shares).
(j) Such Selling Stockholder has not taken and
will not take, directly or indirectly, any action designed to, or that might be
reasonably expected to, cause or result in stabilization or manipulation of the
price of the Common Stock to facilitate the sale or resale of the Shares or
Additional Shares, if any.
(k) Such Selling Stockholder has not distributed
and will not distribute, prior to the later of the Additional Closing Date, if
any, and the completion of the Underwriters' distribution of the Shares, any
offering material in connection with the offering and sale of the Shares and the
Additional Shares, if any, by the Selling Stockholders other than a Preliminary
Prospectus, the Prospectus or the Registration Statement.
(l) Such Selling Stockholder is not prompted to
sell the Shares and the Additional Shares, if any, to be sold by such Selling
Stockholder by any information concerning the Company or any of the Subsidiaries
which is not set forth in the Registration Statement and the Prospectus.
(m) The representations and warranties of such
Selling Stockholder in its Custody Agreement are, and on the Closing Date and
Additional Closing Date, if any, will be, true and correct.
Any certificate signed by or on behalf of such Selling
Stockholder and delivered to the Representatives or to counsel for the
Underwriters shall be deemed to be a representation and warranty by such Selling
Stockholder, severally and not jointly, to each Underwriter as to the matters
covered thereby.
3. Purchase, Sale and Delivery of the Shares.
(a) On the basis of the representations,
warranties, covenants and agreements herein contained, but subject to the terms
and conditions herein set forth, the Company and the Selling Stockholders agree,
severally and not jointly, to sell to each Underwriter and each Underwriter,
severally and not jointly, agrees to purchase from the Company and the Selling
Stockholders, at a purchase price per share of $_______, that proportion of the
number of Firm Shares set forth in Schedule II opposite the name of the Company
or such Selling Stockholder, as the case may be, which the number of Firm
- 13 -
Shares set forth opposite the name of such Underwriter in Schedule I hereto plus
any additional number of Shares which such Underwriter may become obligated to
purchase pursuant to the provisions of Section 10 hereof, bears to the total
number of Firm Shares.
(b) Payment of the purchase price for, and
delivery of certificates for, the Shares shall be made at the office of Fried,
Frank, Harris, Xxxxxxx & Xxxxxxxx., Xxx Xxx Xxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000
("Underwriters' Counsel") or at such other place as shall be agreed upon by
Bear, Xxxxxxx & Co. Inc. and the Company, at 9:00 A.M., New York City time, on
the third or fourth business day (as permitted under Rule 15c6-1 under the
Exchange Act) (unless postponed in accordance with the provisions of Section 10
hereof) following the date of the effectiveness of the Registration Statement
(or, if the Company has elected to rely upon Rule 430A of the Rules and
Regulations, the third or fourth business day (as permitted under Rule 15c6-1
under the Exchange Act) after the determination of the public offering price of
the Shares), or such other time not later than ten business days after such date
as shall be agreed upon by Bear, Xxxxxxx & Co. Inc., the Company and the Selling
Stockholders (such time and date of payment and delivery being herein called the
"Closing Date").
(c) Payment for the Shares shall be made to or
upon the order of the Company and the Selling Stockholders by wire transfer in
Federal (same day) funds to bank accounts designated by the Company and each
Selling Stockholder, as the case may be, upon delivery of certificates for the
Shares to you through the facilities of The Depository Trust Company for the
respective accounts of the several Underwriters against receipt therefor signed
by you. Certificates for the Shares to be delivered to you shall be registered
in such name or names and shall be in such denominations as you may request at
least one business day before the Closing Date. The Company will permit you to
examine and package such certificates for delivery at least one full business
day prior to the Closing Date.
(d) In addition, each Selling Stockholder
indicated in Schedule II hereto to be a seller of Additional Shares to the
Underwriters, severally and not jointly, hereby grants to the Underwriters,
the option to purchase up to the respective number of Additional Shares
specified adjacent to such Selling Stockholder's name in Schedule II hereto at
the same purchase price per share to be paid by the Underwriters to the Company
and the Selling Stockholders for the Firm Shares as set forth in this Section 3,
for the sole purpose of covering over-allotments in the sale of Firm Shares by
the Underwriters. This option may be exercised at any time and from time to
time, in whole or in part on one or more occasions, on or before the thirtieth
day following the date of the Prospectus, by written notice by you to the
Company and the Selling Stockholders who are granting such option. Such notice
shall set forth the aggregate number of Additional Shares as to which the option
is being exercised and the date and time, as reasonably determined by you, when
the Additional Shares are to be delivered (any such date and time being herein
sometimes referred to as the "Additional Closing Date"); provided, however, that
the Additional Closing Date shall not be earlier than the Closing Date (in which
case the option may be exercised on any day preceding the Closing Date) or
earlier than the business day after the date on which the option shall have been
exercised nor later than the eighth full business day after the date on which
the option
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shall have been exercised (unless such time and date are postponed in
accordance with the provisions of Section 9 hereof). Certificates for the
Additional Shares shall be registered in such name or names and in such
authorized denominations as you may request in writing at least one full
business day prior to the Additional Closing Date. The Company will permit you
to examine and package such certificates for delivery at least one full business
day prior to the Additional Closing Date.
If the option is exercised as to all or any portion of the
Additional Shares, each Underwriter, acting severally and not jointly, will
purchase that proportion of the total number of Additional Shares then being
purchased which the number of Firm Shares set forth opposite the name of such
Underwriter in Schedule I hereto (or such number increased as set forth in
Section 10 hereof) bears to the total number of Firm Shares, subject, however,
to such adjustments to eliminate any fractional shares as Bear, Xxxxxxx & Co.
Inc. in its sole discretion shall make. The number of Additional Shares to be
sold by each Selling Stockholder shall be the number which bears the same ratio
to the aggregate number of Additional Shares being purchased as the number of
Additional Shares set forth opposite the name of such Selling Stockholder in the
third column of Schedule II hereto bears to the maximum number of Additional
Shares which may be sold hereunder, subject, however, to such adjustments to
eliminate any fractional shares as Bear, Xxxxxxx & Co. Inc. in its sole
discretion shall make.
Payment for the Additional Shares to be sold by the Selling
Stockholders shall be made to the Selling Stockholders, by wire transfer in
Federal (same day) funds to bank accounts designated by the Custodian pursuant
to each Selling Stockholder's Custody Agreement, at the offices of Underwriters'
Counsel, or such other location as may be mutually acceptable, upon delivery of
the certificates for the Additional Shares to you for the respective accounts of
the Underwriters.
(e) Each Selling Stockholder hereby agrees that
(i) to the extent applicable, it will pay all stock transfer taxes, stamp duties
and other similar taxes, if any, payable upon the sale or delivery of the Shares
or the Additional Shares to be sold by the Selling Stockholders to the several
Underwriters, or otherwise in connection with the performance of the Selling
Stockholders' obligations hereunder, and (ii) subject to the foregoing proviso,
the Custodian is authorized to deduct for such payment any such amounts from the
proceeds to the Selling Stockholders hereunder and to hold such amounts for the
account of the Selling Stockholders with the Custodian under the Custody
Agreement.
4. Offering. Upon your authorization of the release of
the Firm Shares, the Underwriters propose to offer the Shares for sale to the
public upon the terms and conditions set forth in the Prospectus.
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5. Covenants of the Company; Covenants of the Selling
Stockholders.
A. The Company covenants and agrees with each
of the Underwriters that:
(a) The Registration Statement and any
amendments thereto have become effective, and if Rule 430A is used or the filing
of the Prospectus is otherwise required under Rule 424(b), or Rule 434, the
Company will file the Prospectus (properly completed if Rule 430A has been used)
pursuant to Rule 424(b) within the prescribed time period and will provide
evidence satisfactory to you of such timely filing. If the Company elects to
rely on Rule 434, the Company will prepare and file a Term Sheet that complies
with the requirements of Rule 434 and provides the Underwriters with copies of
such filings prior to their use.
The Company will notify you immediately (and, if requested by
you, will confirm such notice in writing) (i) when the Registration Statement
and any amendments thereto become effective, (ii) of any request by the
Commission for any amendment of or supplement to the Registration Statement or
the Prospectus or for any additional information, (iii) of the Company's
intention to file or prepare any amendments to the Registration Statement
(including pursuant to rule 462(b)), the Term Sheet or any supplement, revision
or amendment to the Registration Statement or the Prospectus, (iv) of the
mailing or the delivery to the Commission for filing of any amendment of or
supplement to the Registration Statement or the Prospectus, (v) of the issuance
by the Commission of any stop order suspending the effectiveness of the
Registration Statement or any post-effective amendment thereto or of the
initiation, or the threatening, of any proceedings therefor, it being understood
that the Company shall make every effort to avoid the issuance of any such stop
order, (vi) of the receipt of any comments from the Commission, and (vii) of the
receipt by the Company of any notification with respect to the suspension of the
qualification of the Shares for sale in any jurisdiction or the initiation or
threatening of any proceeding for that purpose. If the Commission shall propose
or enter a stop order at any time, the Company will make every reasonable effort
to prevent the issuance of any such stop order and, if issued, to obtain the
lifting of such order as soon as possible. The Company will not file any
amendment to the Registration Statement or any amendment of or supplement to the
Prospectus (including the prospectus required to be filed pursuant to Rule
424(b) or Rule 434) that differs from the prospectus on file at the time of the
effectiveness of the Registration Statement before or after the effective date
of the Registration Statement, or file any document under the Exchange Act if
such document would be deemed to be incorporated by reference into the
Prospectus, to which you shall reasonably object in writing after being timely
furnished in advance a copy thereof.
(b) The Company shall comply with the Securities
Act and the Exchange Act to permit completion of the distribution as
contemplated in this Agreement, the Registration Statement and the Prospectus.
If at any time when a prospectus relating to the Shares is required to be
delivered under the Securities Act or the Exchange Act in connection with the
sales of Shares, any event shall have occurred as
- 16 -
a result of which the Prospectus as then amended or supplemented would, in the
judgment of the Underwriters or the Company, include an untrue statement of a
material fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein, in the light of the circumstances
existing at the time of delivery to the purchaser, not misleading, or if it
shall be necessary at any time to amend or supplement the Prospectus or
Registration Statement to comply with the Securities Act or the Rules and
Regulations, or to file under the Exchange Act so as to comply therewith any
document incorporated by reference in the Registration Statement or the
Prospectus or in any amendment thereof or supplement thereto, the Company will
notify you promptly and prepare and file with the Commission, subject to the
second paragraph of Section 5(A)(a) hereof, an appropriate amendment or
supplement (in form and substance satisfactory to you) which will correct such
statement or omission or which will effect such compliance and will use its best
efforts to have any amendment to the Registration Statement declared effective
as soon as possible.
(c) The Company will promptly deliver to each of
the Underwriters and Underwriters' Counsel a signed copy of the Registration
Statement, including all consents and exhibits filed therewith and all documents
incorporated by reference therein and all amendments thereto, and the Company
will promptly deliver to each of the Underwriters such number of copies of any
Preliminary Prospectus, the Prospectus, the Registration Statement, and all
amendments of and supplements to such documents, if any, all documents
incorporated by reference in the Registration Statement and Prospectus or any
amendment thereof or supplement thereto, as you may reasonably request. Prior to
10:00 A.M., New York time, on the business day next succeeding the date of this
Agreement and from time to time thereafter, the Company will furnish the
Underwriters with copies of the Prospectus in New York City in such quantities
as you may reasonably request.
(d) The Company shall promptly deliver to each
of the Underwriters and to Underwriters' Counsel copies of the Preliminary
Prospectus, and the Company consents to the use and delivery of the Preliminary
Prospectus by the Underwriters in accordance with Rule 430 and Section 5(b) of
the Securities Act. The Company shall also furnish to each of the Underwriters
copies of the Final Prospectus as requested by any of the Underwriters.
(e) The Company will use its best efforts, in
cooperation with you, at or prior to the time of effectiveness of the
Registration Statement, to qualify the Shares for offering and sale under the
securities laws relating to the offering or sale of the Shares of such
jurisdictions as you may designate and to maintain such qualification in effect
for so long as required for the distribution thereof; except that in no event
shall the Company be obligated in connection therewith to qualify as a foreign
corporation or to execute a general consent to service of process.
(f) The Company will make generally available to
its security holders and to the Underwriters as soon as practicable, but in any
event not later than twelve months after the effective date of the Registration
Statement (as defined in Rule 158(c) under the Securities Act), an earnings
statement of the Company and the
- 17 -
Subsidiaries (which need not be audited) complying with Section 11(a) of the
Securities Act and the rules and regulations of the Commission thereunder
(including, at the option of the Company, Rule 158).
(g) During the period of 180 days from the date
of the Prospectus, the Company and its Subsidiaries will not, directly or
indirectly, without the prior written consent of Bear, Xxxxxxx & Co. Inc. ("Bear
Xxxxxxx"), issue, sell, offer or agree to sell, grant any option for the sale
of, pledge, make any short sale or maintain any short position, establish or
maintain a "put equivalent position" (within the meaning of Rule 16-a-1(h)under
the Exchange Act), enter into any swap, derivative transaction or other
arrangement that transfers to another, in whole or in part, any of the economic
consequences of ownership of the Common Stock (whether any such transaction is
to be settled by delivery of Common Stock, other securities, cash or other
consideration) or otherwise dispose of, any Common Stock (or any securities
convertible into, exercisable for or exchangeable for Common Stock) or interest
therein of the Company or of any of the Subsidiaries, or file any registration
statement covering any equity securities of the Company or its Subsidiaries, and
the Company will obtain the undertaking of each of its officers and directors,
each of the Selling Stockholders and such of its shareholders as have been
heretofore designated by you and listed on Schedule III attached hereto not to
engage in any of the aforementioned transactions on their own behalf (for the
period of time indicated on Schedule III hereto), other than the Company's and
the Selling Stockholders' sale of Shares hereunder and the Company's issuance of
Common Stock upon (i) the conversion or exchange of convertible or exchangeable
securities outstanding on the date hereof; (ii) the exercise of currently
outstanding options; and (iii) the grant and exercise of options under, or the
issuance and sale of shares pursuant to, employee stock option plans in effect
on the date hereof. Notwithstanding the foregoing, the Company may file a shelf
registration statement for the resale of no more than 3,714,711 shares of the
Company's Common Stock for the benefit certain of the Selling Stockholders
pursuant to the terms of the Registration Rights Agreement dated as of February
22, 2002 among the Company, X.X. Xxxxxx Partners (BHCA), L.P., Combined
Specialty Insurance Company, International Motor Cars Group I, L.L.C. and
International Motor Cars Group II, L.L.C. (the "Registration Rights Agreement"),
including the limitations on underwritten offerings included therein, but,
without the consent of Bear Xxxxxxx, such registration statement may not be
filed prior to the 46th day after the date of the Prospectus and may not be
declared effective prior to the 90th day after the date of the Prospectus.
(h) During the period of five years from the
effective date of the Registration Statement, the Company will furnish to you
copies of all reports or other communications (financial or other) furnished to
security holders, and will deliver to you (i) as soon as they are available,
copies of any reports and financial statements furnished to or filed with the
Commission or any national securities exchange on which any class of securities
of the Company is listed; and (ii) such additional information concerning the
business and financial condition of the Company as you may from time to time
reasonably request (such financial statements to be on a consolidated basis to
the extent the accounts of the Company and the Subsidiaries are consolidated in
reports furnished to its security holders generally or to the Commission).
- 18 -
(i) The Company will apply the net proceeds it
receives from the sale of the Shares as set forth under the caption "Use of
Proceeds" in the Prospectus.
(j) The Company will use its best efforts to
effect the listing of the Shares to be issued by the Company and to maintain the
listing of the Shares on the New York Stock Exchange.
(k) The Company, during the period when the
Prospectus is required to be delivered under the Securities Act or the Exchange
Act, will file all documents required to be filed with the Commission pursuant
to Section 13, 14 or 15 of the Exchange Act within the time periods required by
the Exchange Act and the rules and regulations thereunder.
B. Each Selling Stockholder, severally and not jointly,
covenants and agrees with each Underwriter:
(a) To deliver to the Representatives prior to
the Closing Date a properly completed and executed United States Treasury
Department Form W-8 (if the Selling Stockholder is a non-United States Person)
or Form W-9 (if the Selling Stockholder is a United States Person).
(b) If, at any time prior to the date on which
the distribution of the Shares as contemplated herein and in the Prospectus has
been completed, as determined by the Representatives, such Selling Stockholder
has knowledge of the occurrence of any event as a result of which the Prospectus
or the Registration Statement, in each case as then amended or supplemented,
would include an untrue statement of a material fact or omit to state any
material fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading, such Selling
Stockholder will promptly notify the Company and the Representatives.
(c) To cooperate to the extent necessary to
cause the Registration Statement or any post-effective amendment thereto to
become effective at the earliest possible time and to do and perform all things
to be done and performed under this Agreement by such Selling Stockholder prior
to the Closing Date and to satisfy all conditions precedent to the delivery of
the Shares by such Selling Stockholder.
(d) To pay or to cause to be paid all transfer
taxes with respect to the Shares and the Additional Shares, if any, to be sold
by such Selling Stockholder in accordance with Section 3(e) hereof.
(e) To deliver to Bear, Xxxxxxx & Co. Inc. prior
to the date of this Agreement the lock-up agreement of such Selling Stockholder
referenced in Section 7(i) hereof.
6. Payment of Expenses. Whether or not the transactions
contemplated in this Agreement are consummated or this Agreement is terminated,
the Company hereby agrees to pay all costs and expenses incident to the
performance of the
- 19 -
obligations of the Company hereunder, including the following: (i) the fees,
disbursements and expenses of the Company's counsel and accountants in
connection with the registration of the Shares under the Securities Act and all
other expenses in connection with the preparation, printing and filing of the
Registration Statement, any Preliminary Prospectus and the Prospectus and
amendments and supplements thereto and the mailing and delivering of copies
thereof to the Underwriters and dealers; (ii) the cost of printing any Agreement
among Underwriters, this Agreement, the blue sky memoranda, closing documents
(including any compilations thereof) and any other documents in connection with
the offering, purchase, sale and delivery of the Shares; (iii) all expenses in
connection with the qualification of the Shares for offering and sale under
state securities laws as provided in Section 5(A)(e) hereof, including the fees
and disbursements of counsel for the Underwriters in connection with such
qualification and in connection with the blue sky survey; (iv) all fees and
expenses in connection with listing the Shares on the New York Stock Exchange;
(v) all travel expenses of the Company's officers and employees and any other
expense of the Company incurred in connection with attending or hosting meetings
with prospective purchasers of the Shares; (vi) any stock transfer taxes
incurred in connection with this Agreement or the Offering; (vii) the filing
fees incident to, and the fees and disbursements of counsel for the Underwriters
in connection with, securing any required review by the National Association of
Securities Dealers, Inc. of the terms of the sale of the Shares; and (viii) fees
of the Custodian in connection with the offering of the Shares and the
Additional Shares by the Selling Stockholders. The Company also will pay or
cause to be paid: (i) the cost of preparing stock certificates; (ii) the cost
and charges of any transfer agent or registrar; and (iii) all other costs and
expenses incident to the performance of its obligations hereunder which are not
otherwise specifically provided for in this Section 6. It is understood,
however, that except as provided in this Section, and Sections 8 and 12 hereof,
the Underwriters will pay all of their own costs and expenses, including the
fees of their counsel and stock transfer taxes on resale of any of the Shares by
them. Notwithstanding anything to the contrary in this Section 6, in the event
that this Agreement is terminated pursuant to Section 7 or 12(b) hereof, or
subsequent to a Material Adverse Change, the Company will pay all out-of pocket
expenses of the Underwriters incurred in connection herewith.
The Selling Stockholders will pay all fees and expenses
related to the offering of the Shares and the Additional Shares to be sold by
them, including (i) the fees and disbursements of their counsel, if any, and
(ii) any applicable stock transfer or other taxes related to the offering of
their Shares in accordance with Section 3(e) hereof. Notwithstanding the
foregoing, nothing herein shall affect any agreement that the Company and the
Selling Stockholders may make for the sharing or allocation of such costs and
expenses.
7. Conditions of Underwriters' Obligations. The
obligations of the Underwriters to purchase and pay for the Firm Shares and the
Additional Shares, as provided herein, shall be subject to the accuracy of the
representations and warranties of the Company and the Selling Stockholders
herein contained, as of the date hereof and as of the Closing Date (for purposes
of this Section 7 "Closing Date" shall refer to the Closing Date for the Firm
Shares and any Additional Closing Date, if different, for the
- 20 -
Additional Shares), to the absence from any certificates, opinions, written
statements or letters furnished to you or to Underwriters' Counsel pursuant to
this Section 7 of any misstatement or omission, to the performance by the
Company and the Selling Stockholders of their respective obligations hereunder,
and to each of the following additional terms and conditions:
(a) The Registration Statement shall have become
effective and all necessary approvals from the New York Stock Exchange shall
have been received not later than, if pricing pursuant to Rule 430A, 5:30 P.M.,
New York time, on the date of this Agreement or at such later time and date as
shall have been consented to in writing by you; if the Company shall have
elected to rely upon Rule 430A or Rule 434 of the Rules and Regulations, the
Prospectus shall have been filed with the Commission in a timely fashion in
accordance with Section 5(A)(a) hereof and a form of the Prospectus containing
information relating to the description of the Shares and the method of
distribution and similar matters shall have been filed with the Commission
pursuant to Rule 424(b) within the applicable time period; and, at or prior to
the Closing Date, no stop order suspending the effectiveness of the Registration
Statement or any post-effective amendment thereof shall have been issued and no
proceedings therefor shall have been initiated or threatened by the Commission.
(b) At the Closing Date, you shall have received
the favorable written opinion of Honigman, Miller, Xxxxxxxx and Xxxx LLP,
counsel for the Company, dated the Closing Date, addressed to the Underwriters
in the form attached hereto as Annex I.
(c) At the Closing Date, you shall have received
the favorable written opinion of Xxxxxx X. Xxxxxxx, Xx., Executive Vice
President, General Counsel and Secretary of the Company, dated the Closing Date,
addressed to the Underwriters in the form attached hereto as Annex II.
(d) At the Closing Date, you shall have received
the favorable written opinions of separate counsel for each of the Selling
Stockholders, dated the Closing Date, addressed to the Underwriters,
substantially in the form attached hereto as Annex III.
(e) All proceedings taken in connection with the
sale of the Firm Shares and the Additional Shares as herein contemplated shall
be satisfactory in form and substance to you and to Underwriters' Counsel, and
the Underwriters shall have received from said Underwriters' Counsel a favorable
opinion, dated as of the Closing Date, with respect to the issuance and sale of
the Shares, the Registration Statement and the Prospectus and such other related
matters as you may require, and the Company shall have furnished to
Underwriters' Counsel such documents as they request for the purpose of enabling
them to pass upon such matters.
(f) At the Closing Date, you shall have received
a certificate of the Chief Executive Officer and Executive Vice President -
Finance of the Company, dated the Closing Date, to the effect that (i) the
condition set forth in subsection (a) of
- 21 -
this Section 7 has been satisfied, (ii) as of the date hereof and as of the
Closing Date the representations and warranties of the Company set forth in
Section 1 hereof are accurate, (iii) as of the Closing Date all agreements,
conditions and obligations of the Company to be performed or complied with
hereunder on or prior thereto have been duly performed or complied with, or
waived, (iv) the Company and the Subsidiaries have not sustained any material
loss or interference with their respective businesses or properties from fire,
flood, hurricane, accident or other calamity, whether or not covered by
insurance, or from any labor dispute or any legal or governmental proceeding,
and (v) subsequent to the respective dates as of which information is given in
the Registration Statement and the Prospectus there has not been any material
adverse change in the capital stock or long-term debt of the Company or any of
the Subsidiaries or any material change, or any development involving a material
prospective change, in the business, prospects, properties, operations,
condition (financial or otherwise) or results of operations of the Company and
the Subsidiaries taken as a whole, except in each case as described in or
contemplated by the Prospectus.
(g) At the time this Agreement is executed and
at the Closing Date, you shall have received a comfort letter from Deloitte &
Touche LLP, independent public accountants for the Company, dated as of the date
of this Agreement and as of the Closing Date, addressed to the Underwriters and
in form and substance satisfactory to the Underwriters and Underwriters'
Counsel. At the time this Agreement is executed, you shall have received a
letter from KPMG LLP, auditors for Sytner, dated as of the date of this
Agreement, addressed to the Underwriters and in form and substance satisfactory
to the Underwriters and Underwriters' Counsel.
(h) Subsequent to the execution and delivery of
this Agreement or, if earlier, the dates as of which information is given in the
Registration Statement (exclusive of any amendment thereof) and the Prospectus
(exclusive of any supplement thereto), there shall not have been any change in
the capital stock or long-term debt of the Company or any of the Subsidiaries or
any change, or any development involving a prospective change, in or affecting
the condition (financial or otherwise), results of operations, business,
properties or prospects of the Company and the Subsidiaries taken as a whole,
including, without limitation, the occurrence of a fire, flood, explosion or
other calamity at any of the properties owned or leased by the Company or any of
its Subsidiaries, the effect of which, in any such case described above, is, in
the judgment of the Underwriters, so material and adverse as to make it
impracticable or inadvisable to proceed with the public offering or the delivery
of the Shares on the terms and in the manner contemplated in the Prospectus
(exclusive of any supplement).
(i) You shall have received a lock-up agreement
from each person who is a director or an executive officer of the Company, each
Selling Stockholder and each other person listed on Schedule III hereto
substantially in the form attached hereto as Annex III (for the period of time
indicated on Schedule III hereto).
(j) At the Closing Date, the Shares shall have
been approved for listing on the New York Stock Exchange.
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(k) At the Closing Date, the NASD shall have
confirmed that it has not raised any objection with respect to the fairness and
reasonableness of the underwriting terms and arrangements.
(l) At the Closing Date, you shall have received
a certificate of an authorized representative of each of the Selling
Stockholders, dated the Closing Date, to the effect that the several
representations and warranties of such Selling Stockholder set forth in Section
2 hereof are accurate and that such Selling Stockholder has complied with all
agreements and satisfied all conditions on its part to be performed or satisfied
hereunder at or prior to the Closing Date.
(m) On or prior to the Closing Date, you shall
have received a properly completed and executed United States Treasury
Department Form W-9 (or other applicable form or statement specified by Treasury
Department regulations in lieu thereof) from each Selling Stockholder.
(n) At the Closing Date, you shall have received
copies, addressed to you (or stating that you are entitled to rely thereon), of
the opinions of the Company's counsel issued in connection with the offer and
sale of the Notes pursuant to the Debt Agreement.
(o) The Company shall have complied with the
provisions of Section 5(A)(c) hereof with respect to the furnishing of
prospectuses.
(p) The Company shall have furnished the
Underwriters and Underwriters' Counsel with such other certificates, opinions or
other documents as they may have reasonably requested.
In the event the Underwriters exercise their option to
purchase the Additional Shares, all of the conditions in this Section 7 must be
satisfied in connection with such Additional Shares on or prior to the
Additional Closing Date.
If any of the conditions specified in this Section 7 shall not
have been fulfilled when and as required by this Agreement, or if any of the
certificates, opinions, written statements or letters furnished to you or to
Underwriters' Counsel pursuant to this Section 7 shall not be satisfactory in
form and substance to you and to Underwriters' Counsel, all obligations of the
Underwriters hereunder may be cancelled by you at, or at any time prior to, the
Closing Date and the obligations of the Underwriters to purchase the Additional
Shares may be cancelled by you at, or at any time prior to, the Additional
Closing Date. Notice of such cancellation shall be given to the Company in
writing or by telephone. Any such telephone notice shall be confirmed promptly
thereafter in writing.
8. Indemnification.
(a) The Company shall indemnify and hold
harmless each Underwriter and each person, if any, who controls any Underwriter
within the meaning of Section 15 of the Securities Act or Section 20(a) of the
Exchange Act against any and all losses, liabilities, claims, damages and
expenses whatsoever as incurred (including but
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not limited to reasonable attorneys' fees and any and all expenses whatsoever
incurred in investigating, preparing or defending against any litigation,
commenced or threatened, or any claim whatsoever, and any and all amounts paid
in settlement of any claim or litigation), joint or several, to which they or
any of them may become subject under the Securities Act, the Exchange Act or
otherwise, insofar as such losses, liabilities, claims, damages or expenses (or
actions in respect thereof) arise out of or are based upon any untrue statement
or alleged untrue statement of a material fact contained in the Registration
Statement for the registration of the Shares, as originally filed or any
amendment thereof, or any related Preliminary Prospectus or the Prospectus, or
in any supplement thereto or amendment thereof, or arise out of or are based
upon the omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not misleading,
or in connection with any action taken by or liability or damages owing to an
automobile manufacturer or similar party arising out of the sale of the Shares,
the sale of the Notes, the Acquisition, the financing thereof or any transaction
contemplated by any of the foregoing; provided, however, that the Company will
not be liable in any such case to the extent but only to the extent that any
such loss, liability, claim, damage or expense arises out of or is based upon
any such untrue statement or alleged untrue statement or omission or alleged
omission made therein in reliance upon and in conformity with written
information furnished to the Company by or on behalf of any Underwriter through
you expressly for use therein (which the Company and the Underwriters agree is
limited to the "Underwriters' Information" as defined in Section 1(b) hereof).
The foregoing indemnity agreement with respect to any preliminary prospectus
shall not inure to the benefit of any Underwriter who failed to deliver a
Prospectus (as then amended or supplemented, provided by the Company to the
several Underwriters in the requisite quantity and on a timely basis to permit
proper delivery on or prior to the Closing Date) to the person asserting any
losses, claims, damages and liabilities and judgments caused by any untrue
statement or alleged untrue statement of a material fact contained in any
preliminary prospectus, or caused by any omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, if such material misstatement or omission or
alleged material misstatement or omission was cured, as determined by a court of
competent jurisdiction in a decision not subject to further appeal, in such
Prospectus and such Prospectus was required by law to be delivered at or prior
to the written confirmation of sale to such person. This indemnity agreement
will be in addition to any liability which the Company may otherwise have
including under this Agreement.
(b) Each Selling Stockholder, severally and not
jointly, agrees to indemnify and hold harmless each Underwriter and each person,
if any, who controls any Underwriter within the meaning of Section 15 of the
Securities Act or Section 20(a) of the Exchange Act against any and all losses,
liabilities, claims, damages and expenses whatsoever as incurred (including but
not limited to reasonable attorneys' fees and any and all expenses whatsoever
incurred in investigating, preparing or defending against any litigation,
commenced or threatened, or any claim whatsoever and any and all amounts paid in
settlement of any claim or litigation), joint or several, to which they or any
of them may become subject under the Securities Act, the Exchange Act or
otherwise, insofar as such losses, liabilities, claims, damages or expenses (or
actions in respect
- 24 -
thereof) arise out of or are based upon any untrue statement or alleged untrue
statement of a material fact contained in the Selling Stockholder Information
furnished by such Selling Stockholder in writing expressly for use in the
Registration Statement for the registration of the Shares, as originally filed
or any amendment thereof, or any related Preliminary Prospectus or the
Prospectus, or in any supplement thereto, or amendment thereof arise out of or
are based upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading; provided, however, that in no such case shall any Selling
Stockholder be liable or responsible for any amount in excess of the proceeds
(net of the underwriting discount but before deducting other expenses)
applicable to the Shares sold by such Selling Stockholder pursuant to the
transactions contemplated hereby. The parties hereto acknowledge and agree that
the Selling Stockholder Information consists solely of the information set forth
opposite such Selling Stockholder's name in the table and the information
described in the related footnote in the Prospectus under the captions "Selling
Stockholders" and "Principal Stockholders." The foregoing indemnity agreement
with respect to any preliminary prospectus shall not inure to the benefit of any
Underwriter who failed to deliver a Prospectus (as then amended or supplemented,
provided by the Company to the several Underwriters in the requisite quantity
and on a timely basis to permit proper delivery on or prior to the Closing Date)
to the person asserting any losses, claims, damages and liabilities and
judgments caused by any untrue statement or alleged untrue statement of a
material fact contained in any preliminary prospectus, or caused by any omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, if such
material misstatement or omission or alleged material misstatement or omission
was cured, as determined by a court of competent jurisdiction in a decision not
subject to further appeal, in such Prospectus and such Prospectus was required
by law to be delivered at or prior to the written confirmation of sale to such
person.
(c) Each Underwriter severally, and not jointly,
shall indemnify and hold harmless the Company, each of the directors of the
Company, each of the officers of the Company who shall have signed the
Registration Statement, and each other person, if any, who controls the Company
within the meaning of Section 15 of the Securities Act or Section 20(a) of the
Exchange Act and each Selling Stockholder, against any losses, liabilities,
claims, damages and expenses whatsoever as incurred (including but not limited
to reasonable attorneys' fees and any and all expenses whatsoever incurred in
investigating, preparing or defending against any litigation, commenced or
threatened, or any claim, and any and all amounts paid in settlement of any
claim or litigation), jointly or severally, to which they or any of them may
become subject under the Securities Act, the Exchange Act or otherwise, insofar
as such losses, liabilities, claims, damages or expenses (or actions in respect
thereof) arise out of or are based upon any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement for the
registration of the Shares, as originally filed or any amendment thereof, or any
related preliminary prospectus or the Prospectus, or in any amendment thereof or
supplement thereto, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, in each case to the
extent, but only to the extent, that any such loss, liability, claim, damage or
expense arises out of or
- 25 -
is based upon any such untrue statement or alleged untrue statement or omission
or alleged omission made therein in reliance upon and in conformity with written
information furnished to the Company by or on behalf of any Underwriter through
you expressly for use therein; provided, however, that in no case shall any
Underwriter be liable or responsible for any amount in excess of the
underwriting discount applicable to the Shares purchased by such Underwriter
hereunder. This indemnity will be in addition to any liability which any
Underwriter may otherwise have including under this Agreement. The Company and
the Selling Stockholders acknowledge that the statements set forth in the third
paragraph under the caption "Underwriting" in the Prospectus constitute the only
information furnished in writing by or on behalf of any Underwriter expressly
for use in the Registration Statement relating to the Shares as originally filed
or in any amendment thereof, any related preliminary prospectus or the
Prospectus or in any amendment thereof or supplement thereto, as the case may
be.
(d) Promptly after receipt by an indemnified
party under subsection (a), (b) or (c) above of notice of any claims or the
commencement of any action, such indemnified party shall, if a claim in respect
thereof is to be made against the indemnifying party under such subsection,
notify each party against whom indemnification is to be sought in writing of the
claim or the commencement thereof (but the failure so to notify an indemnifying
party shall not relieve the indemnifying party from any liability which it may
have under this Section 8 to the extent that it is not materially prejudiced as
a result thereof and in any event shall not relieve it from any liability that
such indemnifying party may have otherwise than on account of the indemnity
agreement hereunder). In case any such claim or action is brought against any
indemnified party, and it notifies an indemnifying party of the commencement
thereof, an indemnifying party may participate, at its own expense, in the
defense of such action, and to the extent it may elect by written notice
delivered to the indemnified party promptly after receiving the aforesaid notice
from such indemnified party, to assume the defense thereof with counsel
satisfactory to such indemnified party; provided however, that counsel to the
indemnifying party shall not (except with the written consent of the indemnified
party) also be counsel to the indemnified party. Notwithstanding the foregoing,
the indemnified party or parties shall have the right to employ its or their own
counsel in any such case, but the fees and expenses of such counsel shall be at
the expense of such indemnified party or parties unless (i) the employment of
such counsel shall have been authorized in writing by one of the indemnifying
parties in connection with the defense of such action, (ii) the indemnifying
parties shall not have employed counsel to have charge of the defense of such
action within a reasonable time after notice of commencement of the action,
(iii) the indemnifying party does not diligently defend the action after
assumption of the defense, or (iv) such indemnified party or parties shall have
reasonably concluded that there may be defenses available to it or them which
are different from or additional to those available to one or all of the
indemnifying parties (in which case the indemnifying parties shall not have the
right to direct the defense of such action on behalf of the indemnified party or
parties), in any of which events such fees and expenses shall be borne by the
indemnifying parties. No indemnifying party shall, without the prior written
consent of the indemnified parties, effect any settlement or compromise of, or
consent to the entry of judgment with respect to any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
- 26 -
threatened, or any claim whatsoever in respect of which indemnification or
contribution could have been sought under Section 8 or 9 hereof (whether or not
the indemnified parties are actual or potential parties thereto), unless such
settlement, compromise or consent (i) includes an unconditional release of the
indemnified party from all liability arising out of such litigation,
investigation, proceeding or claim, (ii) does not include a statement as to, or
an admission of, fault, culpability or a failure to act, by or on behalf of the
indemnified party and (iii) the indemnifying party reaffirms its indemnification
obligations pursuant to this Agreement.
9. Contribution. In order to provide for contribution in
circumstances in which the indemnification provided for in Section 8 hereof is
for any reason held to be unavailable from any indemnifying party or is
insufficient to hold harmless a party indemnified thereunder, the Company, the
Selling Stockholders and the Underwriters shall contribute to the aggregate
losses, claims, damages, liabilities and expenses of the nature contemplated by
such indemnification provision (including any investigation, legal and other
expenses incurred in connection with, and any amount paid in settlement of, any
action, suit or proceeding or any claims asserted, but after deducting in the
case of losses, claims, damages, liabilities and expenses suffered by the
Company and each Selling Stockholder, any contribution received by the Company
and/or the Selling Stockholder from persons, other than the Underwriters, who
may also be liable for contribution, including persons who control the Company
within the meaning of Section 15 of the Securities Act or Section 20(a) of the
Exchange Act, officers of the Company who signed the Registration Statement and
directors of the Company) as incurred to which the Company, each Selling
Stockholder and one or more of the Underwriters may be subject, in such
proportions as are appropriate to reflect the relative benefits received by the
Company and the Selling Stockholders on the one hand and the Underwriters on the
other hand from the offering of the Shares or, if such allocation is not
permitted by applicable law or indemnification is not available as a result of
the indemnifying party not having received notice as provided in Section 8
hereof, in such proportions as are appropriate to reflect not only the relative
benefits referred to above but also the relative fault of the Company and the
Selling Stockholders on the one hand and the Underwriters on the other hand in
connection with the statements or omissions which resulted in such losses,
claims, damages, liabilities or expenses, as well as any other relevant
equitable considerations.
The relative benefits received by the Company and the Selling
Stockholders on the one hand and the Underwriters on the other hand shall be
deemed to be in the same proportion as (x) the total proceeds from the offering
(net of underwriting discounts and commissions but before deducting expenses)
received by the Company and the Selling Stockholders bear to (y) the
underwriting discount received by the respective Underwriters, respectively, in
each case as set forth in the table on the cover page of the Prospectus. The
relative fault of each of the Company, any Selling Stockholder and of the
Underwriters 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, the Selling Stockholder or the Underwriters and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission. The
- 27 -
Company, the Selling Stockholders and the Underwriters agree that it would not
be just and equitable if contribution pursuant to this Section 9 were determined
by pro rata allocation (even if the Underwriters were treated as one entity for
such purpose) or by any other method of allocation which does not take account
of the equitable considerations referred to above in this Section 9. The
aggregate amount of losses, liabilities, claims, damages and expenses incurred
by an indemnified party and referred to above in this Section 9 shall be deemed
to include any legal or other expenses reasonably incurred by such indemnified
party in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue or alleged untrue
statement or omission or alleged omission. Notwithstanding the provisions of
this Section 9, (i) no Underwriter shall 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 which such Underwriter has otherwise been required to pay
by reason of such untrue or alleged untrue statement or omission or alleged
omission, (ii) in no case shall any Selling Stockholder be required to
contribute any amount in excess of the proceeds (net of underwriting discount
but before deducting other expenses) applicable to the Shares sold by such
Selling Stockholder pursuant to the transactions contemplated hereby, and (iii)
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. For purposes of this
Section 9, each person, if any, who controls an Underwriter within the meaning
of Section 15 of the Securities Act or Section 20 of the Exchange Act shall have
the same rights to contribution as such Underwriter, and each person, if any,
who controls the Company within the meaning of Section 15 of the Securities Act
or Section 20 of the Exchange Act, each officer of the Company who shall have
signed the Registration Statement and each director of the Company shall have
the same rights to contribution as the Company. Any party entitled to
contribution will, promptly after receipt of notice of commencement of any
action, suit or proceeding against such party in respect of which a claim for
contribution may be made against another party or parties, notify each party or
parties from whom contribution may be sought, but the omission to so notify such
party or parties shall not relieve the party or parties from whom contribution
may be sought from any obligation it or they may have under this Section 9 or
otherwise. The obligations of the Underwriters to contribute pursuant to this
Section 9 are several in proportion to the respective number of Shares purchased
by each of the Underwriters hereunder and not joint. The obligations of the
Selling Stockholders to contribute pursuant to this Section 9 are several in
proportion to the respective number of Shares to be sold by each of the Selling
Stockholders hereunder and not joint.
10. Default by an Underwriter.
(a) If any Underwriter or Underwriters shall
default in its or their obligation to purchase Firm Shares or Additional Shares
hereunder, and if the Firm Shares or Additional Shares with respect to which
such default relates do not (after giving effect to arrangements, if any, made
by you pursuant to subsection (b) below) exceed in the aggregate 10% of the
number of Firm Shares or Additional Shares, the Firm Shares or
- 28 -
Additional Shares to which the default relates shall be purchased by the
non-defaulting Underwriters in proportion to the respective proportions which
the numbers of Firm Shares set forth opposite their respective names in Schedule
I hereto bear to the aggregate number of Firm Shares set forth opposite the
names of the non-defaulting Underwriters.
(b) In the event that such default relates to
more than 10% of the Firm Shares or Additional Shares, as the case may be, you
may in your discretion arrange for yourself or for another party or parties
(including any non-defaulting Underwriter or Underwriters who so agree) to
purchase such Firm Shares or Additional Shares, as the case may be, to which
such default relates on the terms contained herein. In the event that within
five calendar days after such a default you do not arrange for the purchase of
the Firm Shares or Additional Shares, as the case may be, to which such default
relates as provided in this Section 10, this Agreement or, in the case of a
default with respect to the Additional Shares, the obligations of the
Underwriters to purchase and of the Company and the Selling Stockholders to sell
the Additional Shares shall thereupon terminate, without liability on the part
of the Company or the Selling Stockholders with respect thereto (except in each
case as provided in Sections 6, 8(a) and 9 hereof with respect to the Company
and Sections 8(b) and 9 hereof with respect to the Selling Stockholders) or the
Underwriters, but nothing in this Agreement shall relieve a defaulting
Underwriter or Underwriters of its or their liability, if any, to the other
Underwriters and the Company and the Selling Stockholders for damages occasioned
by its or their default hereunder.
(c) In the event that the Firm Shares or
Additional Shares to which the default relates are to be purchased by the
non-defaulting Underwriters, or are to be purchased by another party or parties
as aforesaid, you or the Company shall have the right to postpone the Closing
Date or Additional Closing Date, as the case may be, for a period, not exceeding
five business days, in order to effect whatever changes may thereby be made
necessary in the Registration Statement or the Prospectus or in any other
documents and arrangements, and the Company agrees to file promptly any
amendment or supplement to the Registration Statement or the Prospectus which,
in the opinion of Underwriters' Counsel, may thereby be made necessary or
advisable. The term "Underwriter" as used in this Agreement shall include any
party substituted under this Section 10 with like effect as if it had originally
been a party to this Agreement with respect to such Firm Shares and Additional
Shares.
11. Survival of Representations and Agreements. All
representations and warranties, covenants and agreements of the Underwriters,
the Company and the Selling Stockholders contained in this Agreement or in
certificates of officers of the Company or any Subsidiary or of the Selling
Stockholders submitted hereto or thereto, including the agreements contained in
Section 6, the indemnity agreements contained in Section 8 and the contribution
agreements contained in Section 9, shall remain operative and in full force and
effect regardless of any investigation made by or on behalf of any Underwriter
or any controlling person thereof or by or on behalf of the Company or the
Selling Stockholders, any of their officers and directors or any controlling
person thereof, and shall survive delivery of and payment for the Shares to and
by the Underwriters. The representations contained in Section 1 and the
agreements contained in Sections 6, 8, 9,
- 29 -
11 and 12(d) hereof shall survive the termination of this Agreement, including
termination pursuant to Section 10 or 12 hereof.
12. Effective Date of Agreement; Termination.
(a) This Agreement shall become effective, upon
the later of (i) when you and the Company shall have received notification of
the effectiveness of the Registration Statement or (ii) the execution of this
Agreement. If either the public offering price or the purchase price per Share
has not been agreed upon prior to 5:00 P.M., New York City time, on the fifth
full business day after the Registration Statement shall have become effective,
this Agreement shall thereupon terminate without liability to the Company, the
Selling Stockholders or the Underwriters except as herein expressly provided.
Until this Agreement becomes effective as aforesaid, it may be terminated by the
Company by notifying you or by you notifying the Company. Notwithstanding the
foregoing, the provisions of this Section 12 and of Sections 1, 6, 8 and 9
hereof shall at all times be in full force and effect.
(b) You shall have the right to terminate this Agreement
at any time prior to the Closing Date or to terminate the obligations of the
Underwriters to purchase the Additional Shares at any time prior to the
Additional Closing Date, as the case may be, if (A) any domestic or
international event or act or occurrence has materially disrupted, or in your
opinion will in the immediate future materially disrupt, the market for the
Company's securities or securities in general; or (B) if trading on the New York
Stock Exchange, Nasdaq or the American Stock Exchange shall have been suspended,
or minimum or maximum prices for trading shall have been fixed, or maximum
ranges for prices for securities shall have been required, on the New York Stock
Exchange, Nasdaq or the American Stock Exchange by the New York Stock Exchange,
Nasdaq or the American Stock Exchange or by order of the Commission or any other
governmental authority having jurisdiction; or (C) if a banking moratorium has
been declared by New York, Delaware, California or federal authority or if any
material disruption in commercial banking or securities settlement or clearance
services shall have occurred; or (D) any downgrading shall have occurred in the
Company's corporate credit rating or the rating accorded the Company's debt
securities by any "nationally recognized statistical rating organization" as
that term is defined by the Commission for purposes of Rule 436(g)(2) under the
Securities Act or if any such organization shall have publicly announced that it
has under surveillance or review, with possible negative implications, its
rating of any of the Company's debt securities; or (E) (i) if there shall have
occurred any outbreak or escalation of hostilities or acts of terrorism
involving the United States or there is a declaration of a national emergency or
war by the United States or (ii) if there shall have been any other calamity or
crisis or any change in political, financial or economic conditions if the
effect of any such event in (i) or (ii) in your judgment makes it impracticable
or inadvisable to proceed with the offering, sale and delivery of the Firm
Shares or the Additional Shares, as the case may be, on the terms and in the
manner contemplated by the Prospectus.
(c) Any notice of termination pursuant to this
Section 12 shall be in writing.
- 30 -
(d) If this Agreement shall be terminated
pursuant to any of the provisions hereof (otherwise than pursuant to (i)
notification by you as provided in Section 12(a) hereof or (ii) Section 10(b)),
or if the sale of the Shares provided for herein is not consummated because any
condition to the obligations of the Underwriters set forth herein is not
satisfied or because of any refusal, inability or failure on the part of the
Company to perform any agreement herein or comply with any provision hereof, the
Company will, subject to demand by you, reimburse the Underwriters for all
out-of-pocket expenses (including the fees and expenses of their counsel),
incurred by the Underwriters in connection herewith. If this Agreement shall be
terminated pursuant to Section 12(b) hereof, then no party shall have any
liability hereunder except for the Company's obligation, pursuant to Section 6
hereof, to pay all out-of-pocket expenses of the Underwriters (including the
fees and expenses of their counsel) incurred in connection with this Agreement.
13. Notices. All communications hereunder, except as may
be otherwise specifically provided herein, shall be in writing, and:
(a) if sent to any Underwriter, shall be mailed,
delivered, or faxed and confirmed in writing, to such Underwriter c/o Bear,
Xxxxxxx & Co. Inc., 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Equity
Capital Markets, with a copy to Fried, Frank, Harris, Xxxxxxx & Xxxxxxxx, Xxx
Xxx Xxxx Xxxxx, Xxx Xxxx, Xxx Xxxx, 00000, Attention: Xxxxxxx Xxxx Jacob, Esq.
(b) if sent to the Company, shall be mailed,
delivered, or faxed and confirmed in writing to the Company and its counsel at
the addresses set forth in the Registration Statement, Attention: Xxxxxx X.
Xxxxxxx, Xx., Esq.;
(c) if sent to X.X. Xxxxxx Partners (BHCA),
L.P., shall be mailed, delivered, or faxed and confirmed in writing to c/o X.X.
Xxxxxx Partners, L.L.C., 0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Xx. Xxxxxx X. Xxxxxxx, with a copy to X'Xxxxxxxx LLP, 00 Xxxxxxxxxxx
Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxx Xxxxxxx, Esq.
(d) if sent to Combined Specialty Insurance
Company, shall be mailed, delivered, or faxed and confirmed in writing to
Combined Specialty Insurance Company c/o Aon Advisors, Inc. 000 Xxxx Xxxxxxxx
Xxxxx, Xxxxxxx, Xxxxxxxx 00000, Attention: Xxxxxx Xxxx, with a copy to Sidley
Xxxxxx Xxxxx & Xxxx, LLP Bank One Plaza, 00 Xxxxx Xxxxxxxx Xxxxxx, Xxxxxxx,
Xxxxxxxx 00000, Attention: Xxxxxx Xxxx, Esq.;
(e) if sent to Aeneas Venture Corporation, shall
be mailed, delivered, or faxed and confirmed in writing to Aeneas Venture
Corporation, c/o Charlesbank Capital Partners, LLC, 000 Xxxxxxxx Xxxxxx, 00xx
Xx, Xxxxxx, XX 00000, Attention: Xxxx X. Xxxxx, with a copy to Ropes & Xxxx, Xxx
Xxxxxxxxxxxxx Xxxxx, Xxxxxx, XX 00000, Attention: Xxxxx Xxxxxx Xxxx;
provided, however, that any notice to an Underwriter pursuant to
Section 8 shall be delivered or sent by mail or facsimile transmission to such
Underwriter at its address
- 31 -
set forth in its acceptance facsimile to you, which address will be supplied to
any other party hereto by you upon request. Any such statements, requests,
notices or agreements shall take effect at the time of receipt thereof.
14. Parties. This Agreement shall insure solely to the
benefit of, and shall be binding upon, the Underwriters, the Company and the
Selling Stockholders and the controlling persons, directors, officers, employees
and agents referred to in Sections 8 and 9 hereof, and their respective
successors and assigns, and no other person shall have or be construed to have
any legal or equitable right, remedy or claim under or in respect of or by
virtue of this Agreement or any provision herein contained. This Agreement and
all conditions and provisions hereof are intended to be for the sole and
exclusive benefit of the parties hereto and their respective successors, and
said controlling persons, and officers and directors and their heirs and legal
representatives, and it is not for the benefit of any other person, firm or
corporation. The term "successors and assigns" shall not include a purchaser, in
its capacity as such, of Shares from any of the Underwriters.
15. Governing Law. This Agreement shall be governed by
and construed in accordance with the laws of the State of New York, but without
regard to principles of conflicts of law.
16. Counterparts. This Agreement may be executed in any
number of counterparts, each of which may be delivered by facsimile and shall be
deemed to be an original, but all such counterparts shall together constitute
one and the same instrument.
17. Headings. The headings herein are inserted for
convenience of reference only and are not intended to be part of, or to affect
the meaning or interpretation of, this Agreement.
18. Time is of the Essence. Time shall be of the essence
of this Agreement. As used herein, the term "business day" shall mean any day
when the Commission's office in Washington, D.C. is open for business.
[signature page follows]
- 32 -
If the foregoing correctly sets forth the understanding among
you, the Company and the Selling Stockholders, please so indicate in the space
provided below for that purpose, whereupon this letter shall constitute a
binding agreement among us. It is understood that your acceptance of this letter
on behalf of each of the Underwriters is pursuant to the authority set forth in
a form of Agreement among Underwriters, the form of which shall be submitted to
the Company for examination, upon request, but without warranty on your part as
to the authority of the signers thereof.
Very truly yours,
UNITED AUTO GROUP, INC.
By:
-------------------------------------
Name:
Title:
AENEAS VENTURE CORPORATION
By:
--------------------------------------
Name:
Title:
X.X. XXXXXX PARTNERS (BHCA), L.P.
By: JPMP Master Fund Manager, L.P.,
its General Partner
By: JPMP Capital Corp.,
its General Partner
By:
--------------------------------------
Name:
Title:
COMBINED SPECIALTY INSURANCE COMPANY
By:
-------------------------------------
Name:
Title:
- 33 -
Accepted as of the date first above written
BEAR, XXXXXXX & CO. INC.
By:
------------------------------------
Name:
Title:
On behalf of themselves and the other
Underwriters named in Schedule I hereto.
- 34 -
SCHEDULE I
NAME OF UNDERWRITER NUMBER OF FIRM SHARES
TO BE PURCHASED
Bear, Xxxxxxx & Co. Inc.............................
Banc of America Securities LLC......................
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
Xxxxxxxxx Xxxxxxxx, Inc.
Xxxxxxxx Inc. _______________
Total:.................................... 6,000,000
I-1
SCHEDULE II
NUMBER OF FIRM MAXIMUM NUMBER OF
SHARES TO BE SOLD ADDITIONAL SHARES TO BE
NAME TO THE UNDERWRITERS SOLD TO THE UNDERWRITERS
---- ------------------- ------------------------
Company 3,000,000 0
Aeneas Venture Corporation c/o 1,227,133 0
Charlesbank Capital Partners, LLC
X.X. Xxxxxx Partners (BHCA), L.P. 1,230,152 624,600
Combined Specialty Insurance 542,715 275,400
Company ("AON")
II-2
SCHEDULE III
NAMES OF STOCKHOLDERS SUBJECT TO THE LOCK-UP PROVISION
Subject to 180 day lock-up
--------------------------
International Motor Cars Group I, L.L.C.
International Motor Cars Group II, L.L.C.
Penske Capital Partners, L.L.C.
Penske Corporation
Penske Automotive Holdings Corp.
Xxxxx X. Penske
Xxxxxx X. XxXxx
Xxxxx X. Xxxxxxxx
Xxxxxx X. Xxxxxxx, Xx.
Xxxx X. Xxxxxxx
Xxxxx X. Xxxxxx
Xxxxxxx X. Xxxxxx
Subject to 90 day lock-up
-------------------------
X.X. Xxxxxx Partners (BHCA), L.P.
Combined Specialty Insurance Company
Aeneas Venture Corporation c/o Charlesbank Capital Partners, LLC
Xxxxx X. Xxxx
Xxxxxxx X. Xxxx
Xxxxxx X. Xxxxxxxxx
Xxxxxxxx Xxxxxxx
Mitsui & Co., Ltd,
Mitsui & Co. (U.S.A.), Inc.
Xxxxxxx X. Xxxxxxxx
XX-1
ANNEX I
Form of Opinion of Xxxxxxxx Xxxxxx Xxxxxxxx and Xxxx, LLP
A-1
ANNEX II
Form of Opinion of Xxxxxx X. Xxxxxxx, Xx.
A-2
ANNEX III
Form of Opinion of Selling Stockholders' Counsel
X-0
XXXXX XX
_______________ __, 2002
BEAR, XXXXXXX & CO. INC.
BANC OF AMERICA SECURITIES LLC
XXXXXXX LYNCH, PIERCE, XXXXXX & Xxxxx
INCORPORATED
XXXXXXXXX XXXXXXXX, INC.
XXXXXXXX INC.
as Representatives
of the several Underwriters
c/o Bear, Xxxxxxx & Co. Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Equity Capital Markets
United Auto Group, Inc. Lock-Up Agreement
Ladies and Gentlemen:
We refer to the proposed Underwriting Agreement (the "Underwriting
Agreement") between United Auto Group, Inc., a Delaware corporation (the
"Company"), the Selling Stockholders named therein and you as representatives of
the Underwriters named therein (the "Underwriters") relating to an underwritten
public offering (the "Offering") of voting common stock, $0.0001 par value (the
"Common Stock"), of the Company.
In order to induce you and the other Underwriters to enter into the
Underwriting Agreement, the undersigned hereby agrees that, without the prior
written consent of Bear, Xxxxxxx & Co. Inc., the undersigned will not, directly
or indirectly, during the period from the date hereof until [one hundred eighty
(180) days] [ninety (90) days] from the date of the final prospectus for the
Offering (the "Lock-Up Period"), (i) offer, sell, agree to offer or sell,
solicit offers to purchase, grant any call option or purchase any put option
with respect to, pledge, loan or otherwise dispose of any Relevant Security,
(ii) establish or increase a "put equivalent position" or liquidate or decrease
a "call equivalent position" with respect to any Relevant Security (in each case
within the meaning of Section 16 of the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated thereunder), or otherwise
enter into any swap, derivative or other transaction or arrangement that
transfers to another, in whole or in part, any of the economic consequences of
ownership of any Relevant Security, whether or not such transaction is to be
settled by delivery of Relevant Securities, other securities, cash or other
consideration or (iii) announce publicly an intention to do any of the same. As
used herein "Relevant Security" means the Common Stock, any other equity
security of the
A-4
Company or any of the Subsidiaries, any options or warrants to purchase any
shares of Common Stock, and any security convertible into, or exercisable or
exchangeable for, any Common Stock or other such equity security, in each case
whether now owned or hereafter acquired.
The undersigned hereby further agrees that, during the Lock-up Period,
the undersigned (x) will not file or participate in the filing with the
Securities and Exchange Commission of any registration statement, or circulate
or participate in the circulation of any preliminary or final prospectus or
other disclosure document with respect to any proposed offering or sale of a
Relevant Security and (y) will not exercise any rights the undersigned may have
to require registration with the Securities and Exchange Commission of any
proposed offering or sale of a Relevant Security.
The undersigned hereby represents and warrants that the undersigned has
full power and authority to enter into this letter agreement and that this
letter agreement constitutes the legal, valid and binding obligation of the
undersigned, enforceable in accordance with its terms. Upon request, the
undersigned will execute any additional documents necessary in connection with
enforcement hereof. Any obligations of the undersigned shall be binding upon the
successors and assigns of the undersigned from the date first above written.
This letter agreement shall be governed by and construed in accordance
with the laws of the State of New York. Delivery of a signed copy of this letter
by telecopier or facsimile transmission shall be effective as delivery of the
original hereof.
Very truly yours,
By: ______________________________
Print Name: _______________________
A-5
