[3,420,000] SHARES
HOSOKAWA MICRON INTERNATIONAL INC.
COMMON STOCK ($ .01 PAR VALUE)
UNDERWRITING AGREEMENT
[June __, 1998]
CREDIT SUISSE FIRST BOSTON CORPORATION
PAINEWEBBER INCORPORATED
As Representatives of the Several Underwriters,
c/o Credit Suisse First Boston Corporation,
Eleven Xxxxxxx Xxxxxx,
Xxx Xxxx, X.X. 00000-0000.
Dear Sirs:
1. Introductory. Hosokawa Micron International Inc., a Delaware
corporation ("Company"), proposes to issue and sell to the several Underwriters
named in Schedule A hereto ("Underwriters") [2,136,000] shares of its Common
Stock ($.01 par value) ("Securities"), and Hosokawa Micron Corporation, [a
corporation formed under the laws of Japan] ("Selling Stockholder") proposes to
sell to the Underwriters [600,000] outstanding shares of the Securities ("U.S.
Offering") (the aggregate of such [2,736,000] shares of Securities being
hereinafter referred to as the "U.S. Firm Securities").
It is understood that the Company and the Selling Stockholder are
concurrently entering into a Subscription Agreement, dated the date hereof
("Subscription Agreement"), with Credit Suisse First Boston (Europe) Limited
("CSFBL"), PaineWebber International (U.K.) Ltd., and the other managers named
therein ("Managers") relating to the concurrent offering and sale of [684,000]
shares of Securities ("International Firm Securities") outside the United States
and Canada ("International Offering").
In addition, as set forth below the Company proposes to issue and sell
(i) to the Underwriters, at the option of the Underwriters, an aggregate of not
more than 410,400 additional shares of Securities ("U.S. Optional Securities")
and (ii) to the Managers, at the option of the Managers, an aggregate of not
more than 102,600 additional shares of Securities ("International Optional
Securities"). The U.S. Firm Securities and the U.S. Optional Securities are
hereinafter called the "U.S. Securities"; the International Firm Securities and
the International Optional Securities are hereinafter called the "International
Securities"; the U.S. Firm Securities and the International Firm Securities are
hereinafter called the "Firm Securities"; the U.S. Optional Securities and the
International Optional Securities are hereinafter called the "Optional
Securities." The U.S. Securities and the International Securities are
collectively referred to as the "Offered Securities." To provide for the
coordination of their activities, the Underwriters and the Managers have entered
into an Agreement Between U.S. Underwriters and Managers which permits them,
among other things, to sell the Offered Securities to each other for purposes of
resale.
The Company and the Selling Stockholder hereby agree with the several
Underwriters as follows:
2. Representations and Warranties of the Company and the Selling
Stockholder. (a) The Company represents and warrants to, and agrees with, the
several Underwriters that:
(i) A registration statement (No. 333-50551) relating to the
Offered Securities including a form of prospectus relating to the U.S.
Securities and a form of prospectus relating to the International
Securities being offered in the International Offering has been filed
with the Securities and Exchange Commission ("Commission") and either
(A) has been declared effective under the Securities Act of 1933
("Act") and is not proposed to be amended or (B) is proposed to be
amended by amendment or post-effective amendment. If such registration
statement (the "initial registration statement") has been declared
effective, either (A) an additional registration statement (the
"additional registration statement") relating to the Offered Securities
may have been filed with the Commission pursuant to Rule 462(b) ("Rule
462(b)") under the Act and, if so filed, has become effective upon
filing pursuant to such Rule and the Offered Securities all have been
duly registered under the Act pursuant to the initial registration
statement and, if applicable, the additional registration statement or
(B) such an additional registration statement is proposed to be filed
with the Commission pursuant to Rule 462(b) and will become effective
upon filing pursuant to such Rule and upon such filing the Offered
Securities will all have been duly registered under the Act pursuant to
the initial registration statement and such additional registration
statement. If the Company does not propose to amend the initial
registration statement or if an additional registration statement has
been filed and the Company does not propose to amend it, and if any
post-effective amendment to either such registration statement has been
filed with the Commission prior to the execution and delivery of this
Agreement, the most recent amendment (if any) to each such registration
statement has been declared effective by the Commission or has become
effective upon filing pursuant to Rule 462(c) ("Rule 462(c)") under the
Act or, in the case of the additional registration statement, Rule
462(b). For purposes of this Agreement, "Effective Time" with respect
to the initial registration statement or, if filed prior to the
execution and delivery of this Agreement, the additional registration
statement means (A) if the Company has advised the Representatives that
it does not propose to amend such registration statement, the date and
time as of which such registration statement, or the most recent
post-effective amendment thereto (if any) filed prior to the execution
and delivery of this Agreement, was declared effective by the
Commission or has become effective upon filing pursuant to Rule 462(c),
or (B) if the Company has advised the Representatives that it proposes
to file an amendment or post-effective amendment to such registration
statement, the date and time as of which such registration statement,
as amended by such amendment or post-effective amendment, as the case
may be, is declared effective by the Commission. If an additional
registration statement has not been filed prior to the execution and
delivery of this Agreement but the Company has advised the
Representatives that it proposes to file one, "Effective Time" with
respect to such additional registration statement means the date and
time as of which such registration statement is filed and becomes
effective pursuant to Rule 462(b). "Effective Date" with respect to the
initial registration statement or the additional registration statement
(if any) means the date of the Effective Time thereof. The initial
registration statement, as amended at its Effective Time, including all
information contained in the additional registration statement (if any)
and deemed to be a part of the initial registration statement as of the
Effective Time of the additional registration statement pursuant to the
General Instructions of the Form on which it is filed and including all
information (if any) deemed to be a part of the initial registration
statement as of its Effective Time pursuant to Rule 430A(b) ("Rule
430A(b)") under the Act, is hereinafter referred to as the "Initial
Registration Statement." The additional registration statement, as
amended at its Effective Time, including the contents of the initial
registration statement incorporated by reference therein and including
all information (if any) deemed to be a part of the additional
registration statement as of its Effective Time pursuant to Rule
430A(b), is hereinafter referred to as the "Additional Registration
Statement." The Initial Registration Statement and the Additional
Registration Statement are hereinafter referred to collectively as the
"Registration Statements" and individually as a "Registration
Statement." The form of prospectus relating to the U.S. Securities and
the form of prospectus relating to the International Securities, each
as first filed with the Commission pursuant to and in accordance with
Rule 424(b) ("Rule 424(b)") under the Act or (if no such filing is
required) as included in the Registration Statement, are hereinafter
referred to as the "U.S.
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Prospectus" and the "International Prospectus," respectively, and
collectively as the "Prospectuses." No document has been or will be
prepared or distributed in reliance on Rule 434 under the Act.
(ii) If the Effective Time of the Initial Registration
Statement is prior to the execution and delivery of this Agreement: (A)
on the Effective Date of the Initial Registration Statement, the
Initial Registration Statement conformed in all material respects to
the requirements of the Act and the rules and regulations of the
Commission ("Rules and Regulations") and did not include any 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 not misleading, (B) on the Effective Date of the Additional
Registration Statement (if any), each Registration Statement conformed,
or will conform, in all material respects to the requirements of the
Act and the Rules and Regulations and did not include, or will not
include, any untrue statement of a material fact and did not omit, or
will not omit, to state any material fact required to be stated therein
or necessary to make the statements therein not misleading, and (C) on
the date of this Agreement, the Initial Registration Statement and, if
the Effective Time of the Additional Registration Statement is prior to
the execution and delivery of this Agreement, the Additional
Registration Statement each conforms, and at the time of filing of each
of the Prospectuses pursuant to Rule 424(b) or (if no such filing is
required) at the Effective Date of the Additional Registration
Statement in which the Prospectuses are included, each Registration
Statement and each of the Prospectuses will conform, in all material
respects to the requirements of the Act and the Rules and Regulations,
and none of such documents includes, or will include, any untrue
statement of a material fact or omits, or will omit, to state any
material fact required to be stated therein or necessary to make the
statements therein not misleading. If the Effective Time of the Initial
Registration Statement is subsequent to the execution and delivery of
this Agreement: on the Effective Date of the Initial Registration
Statement, the Initial Registration Statement and each of the
Prospectuses will conform in all material respects to the requirements
of the Act and the Rules and Regulations, none of such documents will
include any untrue statement of a material fact or will omit to state
any material fact required to be stated therein or necessary to make
the statements therein not misleading, and no Additional Registration
Statement has been or will be filed. The two preceding sentences do not
apply to statements in or omissions from a Registration Statement or
either of the Prospectuses based upon written information furnished to
the Company by any Underwriter through the Representatives or by any
Manager through CSFBL specifically for use therein, it being understood
and agreed that the only such information is that described as such in
Section 7(b) hereof.
(iii) The Company has been duly incorporated and is an
existing corporation in good standing under the laws of the State of
Delaware, with power and authority (corporate and other) to own its
properties and conduct its business as described in the Prospectuses;
and the Company is duly qualified to do business as a foreign
corporation in good standing in all other jurisdictions in which its
ownership or lease of property or the conduct of its business requires
such qualification.
(iv) Each subsidiary of the Company has been duly incorporated
and is an existing corporation in good standing under the laws of the
jurisdiction of its incorporation, with power and authority (corporate
and other) to own its properties and conduct its business as described
in the Prospectuses; and each subsidiary of the Company is duly
qualified to do business as a foreign corporation in good standing in
all other jurisdictions in which its ownership or lease of property or
the conduct of its business requires such qualification; all of the
issued and outstanding capital stock of each subsidiary of the Company
has been duly authorized and validly issued and is fully paid and
nonassessable; and the capital stock of each subsidiary owned by the
Company, directly or through subsidiaries, is owned free from liens,
encumbrances and defects.
(v) The Offered Securities and all other outstanding shares of
capital stock of the Company have been duly authorized; all outstanding
shares of capital stock of the Company are, and, when the Offered
Securities have been delivered and paid for in accordance with this
Agreement and the Subscription Agreement on each Closing Date (as
defined below), such Offered Securities will have
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been, validly issued, fully paid and nonassessable and will conform to
the description thereof contained in the Prospectuses; and the
stockholders of the Company have no preemptive rights with respect to
the Offered Securities.
(vi) Except as disclosed in the Prospectuses, there are no
contracts, agreements or understandings between the Company and any
person that would give rise to a valid claim against the Company or any
Underwriter or Manager for a brokerage commission, finder's fee or
other like payment in connection with this offering.
(vii) There are no contracts, agreements or understandings
between the Company and any person granting such person the right to
require the Company to file a registration statement under the Act with
respect to any securities of the Company owned or to be owned by such
person or to require the Company to include such securities in the
securities registered pursuant to a Registration Statement or in any
securities being registered pursuant to any other registration
statement filed by the Company under the Act.
(viii) The Offered Securities have been approved for listing
on the New York Stock Exchange subject to notice of issuance.
(ix) No consent, approval, authorization, or order of, or
filing with, any governmental agency or body or any court is required
for the consummation of the transactions contemplated by this Agreement
or the Subscription Agreement in connection with the issuance and sale
of the Offered Securities by the Company, except such as have been
obtained and made under the Act and such as may be required under state
securities laws.
(x) The execution, delivery and performance of this Agreement
and the Subscription Agreement, and the issuance and sale of the
Offered Securities will not result in a breach or violation of any of
the terms and provisions of, or constitute a default under, any
statute, any rule, regulation or order of any governmental agency or
body or any court, domestic or foreign, having jurisdiction over the
Company or any subsidiary of the Company or any of their properties, or
any agreement or instrument to which the Company or any such subsidiary
is a party or by which the Company or any such subsidiary is bound or
to which any of the properties of the Company or any such subsidiary is
subject, or the charter or by-laws of the Company or any such
subsidiary, and the Company has full power and authority to authorize,
issue and sell the Offered Securities as contemplated by this Agreement
and the Subscription Agreement, respectively.
(xi) This Agreement and the Subscription Agreement have been
duly authorized, executed and delivered by the Company.
(xii) Except as disclosed in the Prospectuses, the Company and
its subsidiaries have good and marketable title to all material real
properties and all other material properties and assets owned by them,
in each case free from liens, encumbrances and defects that would
materially affect the value thereof or materially interfere with the
use made or to be made thereof by them; and except as disclosed in the
Prospectuses, the Company and its subsidiaries hold any material leased
real or personal property under valid and enforceable leases with no
exceptions that would materially interfere with the use made or to be
made thereof by them.
(xiii) The Company and its subsidiaries possess adequate
certificates, authorities or permits issued by appropriate governmental
agencies or bodies necessary to conduct the business now operated by
them and have not received any notice of proceedings relating to the
revocation or modification of any such certificate, authority or permit
that, if determined adversely to the Company or any of its
subsidiaries, would individually or in the aggregate have a material
adverse effect on the Company and its subsidiaries taken as a whole.
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(xiv) No labor dispute with the employees of the Company or
any subsidiary exists or, to the knowledge of the Company, is imminent
that might have a material adverse effect on the Company and its
subsidiaries taken as a whole.
(xv) The Company and its subsidiaries own, possess or can
acquire on reasonable terms, adequate trademarks, trade names and other
rights to inventions, know-how, patents, copyrights, confidential
information and other intellectual property (collectively,
"intellectual property rights") necessary to conduct the business now
operated by them, or presently employed by them, and, except as
disclosed in the Prospectuses, have not received any notice of
infringement of or conflict with asserted rights of others with respect
to any intellectual property rights that, if determined adversely to
the Company or any of its subsidiaries, would individually or in the
aggregate have a material adverse effect on the Company and its
subsidiaries taken as a whole.
(xvi) Except as disclosed in the Prospectuses, neither the
Company nor any of its subsidiaries is in violation of any statute, any
rule, regulation, decision or order of any governmental agency or body
or any court, domestic or foreign, relating to the use, disposal or
release of hazardous or toxic substances or relating to the protection
or restoration of the environment or human exposure to hazardous or
toxic substances (collectively, "environmental laws"), owns or operates
any real property contaminated with any substance that is subject to
any environmental laws, is liable for any off-site disposal or
contamination pursuant to any environmental laws, or is subject to any
claim relating to any environmental laws, which violation,
contamination, liability or claim would individually or in the
aggregate have a material adverse effect on the Company and its
subsidiaries taken as a whole; and the Company is not aware of any
pending investigation which might lead to such a claim.
(xvii) Except as disclosed in the Prospectuses, there are no
pending actions, suits or proceedings against or affecting the Company,
any of its subsidiaries or any of their respective properties that, if
determined adversely to the Company or any of its subsidiaries, would
individually or in the aggregate have a material adverse effect on the
condition (financial or other), business, properties or results of
operations of the Company and its subsidiaries taken as a whole, or
would materially and adversely affect the ability of the Company to
perform its obligations under this Agreement or the Subscription
Agreement; and, to the Company's knowledge, no such actions, suits or
proceedings are threatened.
(xviii) The financial statements included in each Registration
Statement and the Prospectuses present fairly the financial position of
the Company and its consolidated subsidiaries as of the dates shown and
their results of operations and cash flows for the periods shown, and
such financial statements have been prepared in conformity with the
generally accepted accounting principles in the United States applied
on a consistent basis; and the schedules included in each Registration
Statement present fairly the information required to be stated therein;
and the assumptions used in preparing the pro forma financial
statements included in each Registration Statement and each of the
Prospectuses provide a reasonable basis for presenting the significant
effects directly attributable to the transactions or events described
therein, the related pro forma adjustments give appropriate effect to
those assumptions, and the pro forma columns therein reflect the proper
application of those adjustments to the corresponding historical
financial statement amounts.
(xix) Except as disclosed in the Prospectuses, since the date
of the latest audited financial statements included in the Prospectuses
there has been no material adverse change, nor any development or event
involving a prospective material adverse change, in the condition
(financial or other), business, properties or results of operations of
the Company and its subsidiaries taken as a
5
whole, and, except as disclosed in or contemplated by the Prospectuses,
there has been no dividend or distribution of any kind declared, paid
or made by the Company on any class of its capital stock.
(xx) The Company is not and, after giving effect to the
offering and sale of the Offered Securities and the application of the
proceeds thereof as described in the Prospectuses, will not be an
"investment company" as defined in the Investment Company Act of 1940.
(xxi) Neither the Company nor any of its affiliates does
business with the government of Cuba or with any person or affiliate
located in Cuba within the meaning of Section 517.075, Florida Statutes
and the Company agrees to comply with such Section if prior to the
completion of the distribution of the Offered Securities it commences
doing such business.
(b) The Selling Stockholder represents and warrants to, and agrees
with, the several Underwriters that:
(i) The Selling Stockholder has and on the First Closing Date
hereinafter mentioned will have valid and unencumbered title to the
Offered Securities to be delivered by the Selling Stockholder on such
Closing Date and full right, power and authority to enter into this
Agreement and the Subscription Agreement and to sell, assign, transfer
and deliver the Offered Securities to be delivered by the Selling
Stockholder on such Closing Date hereunder, and upon the delivery of
and payment for the Offered Securities on such Closing Date hereunder
the several Underwriters and Managers will acquire valid and
unencumbered title to the Offered Securities to be delivered by the
Selling Stockholder on such Closing Date.
(ii) If the Effective Time of the Initial Registration
Statement is prior to the execution and delivery of this Agreement: (A)
on the Effective Date of the Initial Registration Statement, the
Initial Registration Statement conformed in all material respects to
the requirements of the Act and the Rules and Regulations and did not
include any 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 not misleading, (B) on the Effective Date of the
Additional Registration Statement (if any), each Registration Statement
conformed, or will conform, in all material respects to the
requirements of the Act and the Rules and Regulations and did not
include, or will not include, any untrue statement of a material fact
and did not omit, or will not omit, to state any material fact required
to be stated therein or necessary to make the statements therein not
misleading, and (C) on the date of this Agreement, the Initial
Registration Statement and, if the Effective Time of the Additional
Registration Statement is prior to the execution and delivery of this
Agreement, the Additional Registration Statement each conforms, and at
the time of filing of the Prospectuses pursuant to Rule 424(b) or (if
no such filing is required) at the Effective Date of the Additional
Registration Statement in which the Prospectuses are included, each
Registration Statement and each of the Prospectuses will conform, in
all material respects to the requirements of the Act and the Rules and
Regulations, and none of such documents includes, or will include, any
untrue statement of a material fact or omits, or will omit, to state
any material fact required to be stated therein or necessary to make
the statements therein not misleading. If the Effective Time of the
Initial Registration Statement is subsequent to the execution and
delivery of this Agreement: on the Effective Date of the Initial
Registration Statement, the Initial Registration Statement and each of
the Prospectuses will conform in all material respects to the
requirements of the Act and the Rules and Regulations and none of such
documents will include any untrue statement of a material fact or will
omit to state any material fact required to be stated therein or
necessary to make the statements therein not misleading. The two
preceding sentences do not apply to statements in or omissions from a
Registration Statement or either of the Prospectuses based upon written
information furnished to the Company by any Manager through CSFBL or by
any Underwriter through the Representatives specifically for use
therein, it being understood and agreed that the only such information
is that described as such in Section 7(c).
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(iii) Except as disclosed in the Prospectuses, there are no
contracts, agreements or understandings between the Selling Stockholder
and any person that would give rise to a valid claim against the
Selling Stockholder or any Manager or Underwriter for a brokerage
commission, finder's fee or other like payment in connection with this
offering.
3. Purchase, Sale and Delivery of Offered Securities. On the basis of
the representations, warranties and agreements herein contained, but subject to
the terms and conditions herein set forth, the Company and the Selling
Stockholder agree, severally and not jointly, to sell to each Underwriter, and
each Underwriter agrees, severally and not jointly, to purchase from the Company
and the Selling Stockholder, at a purchase price of US$ per share that number of
U.S. Firm Securities set forth below the caption "Company" or "Selling
Stockholder," as the case may be, and opposite the name of such Underwriter in
Schedule A hereto.
Certificates in negotiable form for the Offered Securities to be sold
by the Selling Stockholder hereunder have been placed in custody, for delivery
under this Agreement, under a Custody Agreement made with The Bank of New York,
as custodian ("Custodian"). The Selling Stockholder agrees that the shares
represented by the certificates held in custody for the Selling Stockholder
under such Custody Agreement are subject to the interest of the Underwriters and
the Managers hereunder, that the arrangements made by the Selling Stockholder
for such custody are to that extent irrevocable, and that the obligations of the
Selling Stockholder hereunder shall not be terminated by operation of law.
The Company and the Custodian will deliver the U.S. Firm Securities to
the Representatives for the accounts of the Underwriters, at the office of
Proskauer Rose LLP, 0000 Xxxxxxxx, Xxx Xxxx XX 00000-0000 against payment of the
purchase price in U.S. dollars in Federal (same day) funds by official bank
check or checks or wire transfer to an account at banks acceptable to Credit
Suisse First Boston Corporation ("CSFBC") drawn to the order of Hosokawa Micron
International Inc. in the case of [2,136,000] shares of U.S. Firm Securities and
Hosokawa Micron Corporation in the case of [600,000] shares of U.S. Firm
Securities at 9:00 A.M., New York time, on , or at such other time not
later than seven full business days thereafter as CSFBC and the Company
determine, such time being herein referred to as the "First Closing Date." For
purposes of Rule 15c6-1 under the Securities Exchange Act of 1934, the First
Closing Date (if later than the otherwise applicable settlement date) shall be
the settlement date for payment of funds and delivery of securities for all the
Offered Securities sold pursuant to the U.S. Offering and the International
Offering. The certificates for the U.S. Firm Securities so to be delivered will
be in definitive form, in such denominations and registered in such names as
CSFBC requests and will be made available for checking and packaging at the
above office of Proskauer Rose LLP, at least 24 hours prior to the First Closing
Date.
In addition, upon written notice from CSFBC given to the Company from
time to time not more than 30 days subsequent to the date of the Prospectuses,
the Underwriters may purchase all or less than all of the U.S. Optional
Securities at the purchase price per Security to be paid for the U.S. Firm
Securities. The U.S. Optional Securities to be purchased by the Underwriters on
any Optional Closing Date (as defined below) shall be in the same proportion to
all the Optional Securities to be purchased by the Underwriters and the Managers
on such Optional Closing Date as the U.S. Firm Securities bear to all the Firm
Securities. The Company agrees to sell to the Underwriters such U.S. Optional
Securities and the Underwriters agree, severally and not jointly, to purchase
such U.S. Optional Securities. Such U.S. Optional Securities shall be purchased
for the account of each Underwriter in the same proportion as the number of
shares of U.S. Firm Securities set forth opposite such Underwriter's name bears
to the total number of shares of U.S. Firm Securities (subject to adjustment by
CSFBC to eliminate fractions) and may be purchased by the Underwriters only for
the purpose of covering over-allotments made in connection with the sale of the
U.S. Firm Securities. No Optional Securities shall be sold or delivered unless
the U.S. Firm Securities and the International Firm Securities previously have
been, or simultaneously are, sold and delivered. The right to purchase the
Optional Securities or any portion thereof may be exercised from time to time
and to the extent not previously exercised may be surrendered and terminated at
any time upon notice by CSFBC on behalf of the Underwriters and the Managers to
the Company. It is understood that CSFBC is authorized to make payment for and
accept delivery of such
7
Optional Securities on behalf of the Underwriters and Managers pursuant to the
terms of CSFBC's instructions to the Company.
Each time for the delivery of and payment for the U.S. Optional
Securities, being herein referred to as an "Optional Closing Date," which may be
the First Closing Date (the First Closing Date and each Optional Closing Date,
if any, being sometimes referred to as a "Closing Date"), shall be determined by
CSFBC but shall be not later than five full business days after written notice
of election to purchase Optional Securities is given. The Company will deliver
the U.S. Optional Securities being purchased on each Optional Closing Date to
the Representatives for the accounts of the several Underwriters, against
payment of the purchase price therefor in Federal (same day) funds by official
bank check or checks or wire transfer to an account at a bank acceptable to
CSFBC drawn to the order of Hosokawa Micron International Inc., at the above
office of Proskauer Rose LLP. The certificates for the U.S. Optional Securities
will be in definitive form, in such denominations and registered in such names
as CSFBC requests upon reasonable notice (which shall be at least two full
business days) prior to such Optional Closing Date and will be made available
for checking and packaging at the above office of Proskauer Rose LLP, at a
reasonable time in advance of such Optional Closing Date.
4. Offering by Underwriters. It is understood that the several
Underwriters propose to offer the U.S. Securities for sale to the public as set
forth in the U.S. Prospectus.
5. Certain Agreements of the Company and the Selling Stockholder. The
Company and, to the extent stated herein, the Selling Stockholder agree with the
several Underwriters that:
(a) If the Effective Time of the Initial Registration
Statement is prior to the execution and delivery of this Agreement, the
Company will file each of the Prospectuses with the Commission pursuant
to and in accordance with subparagraph (1) (or, if applicable and if
consented to by CSFBC, subparagraph (4)) of Rule 424(b) not later than
the earlier of (A) the second business day following the execution and
delivery of this Agreement or (B) the fifteenth business day after the
Effective Date of the Initial Registration Statement. The Company will
advise CSFBC promptly of any such filing pursuant to Rule 424(b). If
the Effective Time of the Initial Registration Statement is prior to
the execution and delivery of this Agreement and an additional
registration statement is necessary to register a portion of the
Offered Securities under the Act but the Effective Time thereof has not
occurred as of such execution and delivery, the Company will file the
additional registration statement or, if filed, will file a
post-effective amendment thereto with the Commission pursuant to and in
accordance with Rule 462(b) on or prior to 10:00 P.M., New York time,
on the date of this Agreement or, if earlier, on or prior to the time
either Prospectus is printed and distributed to any Underwriter or
Manager, or will make such filing at such later date as shall have been
consented to by CSFBC.
(b) The Company will advise CSFBC promptly of any proposal to
amend or supplement the initial or any additional registration
statement as filed or either of the related prospectuses or the Initial
Registration Statement, the Additional Registration Statement (if any)
or either of the Prospectuses and will not effect such amendment or
supplementation without CSFBC's prior consent, which shall not be
unreasonably withheld or delayed; and the Company will also advise
CSFBC promptly of the effectiveness of each Registration Statement (if
its Effective Time is subsequent to the execution and delivery of this
Agreement) and of any amendment or supplementation of a Registration
Statement or either of the Prospectuses and of the institution by the
Commission of any stop order proceedings in respect of a Registration
Statement and will use its best efforts to prevent the issuance of any
such stop order and to obtain as soon as possible its lifting, if
issued.
(c) If, at any time when a prospectus relating to the Offered
Securities is required to be delivered under the Act in connection with
sales by any Underwriter, Manager or dealer, any event occurs as a
result of which either or both of the Prospectuses as then amended or
supplemented would
8
include an untrue statement of a material fact or omit to state any
material fact necessary to make the statements therein, in the light of
the circumstances under which they were made, not misleading, or if it
is necessary at any time to amend either or both of the Prospectuses to
comply with the Act, the Company will promptly notify CSFBC of such
event and will promptly prepare and file with the Commission, at its
own expense, an amendment or supplement which will correct such
statement or omission or an amendment which will effect such
compliance. Neither CSFBC's consent to, nor the Underwriters' delivery
of, any such amendment or supplement shall constitute a waiver of any
of the conditions set forth in Section 6.
(d) As soon as practicable, but not later than the
Availability Date (as defined below), the Company will make generally
available to its securityholders an earnings statement covering a
period of at least 12 months beginning after the Effective Date of the
Initial Registration Statement (or, if later, the Effective Date of the
Additional Registration Statement) which will satisfy the provisions of
Section 11(a) of the Act. For the purpose of the preceding sentence,
"Availability Date" means the 45th day after the end of the fourth
fiscal quarter following the fiscal quarter that includes such
Effective Date, except that, if such fourth fiscal quarter is the last
quarter of the Company's fiscal year, "Availability Date" means the
90th day after the end of such fourth fiscal quarter.
(e) The Company will furnish to the Representatives copies of
the Registration Statement (three of which will be signed and will
include all exhibits), each preliminary prospectus relating to the U.S.
Securities, and, so long as a prospectus relating to the Offered
Securities is required to be delivered under the Act in connection with
sales by any Underwriter or dealer, the U.S. Prospectus and all
amendments and supplements to such documents, in each case in such
quantities as CSFBC requests. The U.S. Prospectus shall be so furnished
on or prior to 3:00 P.M., New York time, on the business day following
the later of the execution and delivery of this Agreement or the
Effective Time of the Initial Registration Statement. All other such
documents shall be so furnished as soon as available. The Company and
the Selling Stockholder will pay the expenses of printing and
distributing to the Underwriters all such documents.
(f) The Company will arrange for the qualification of the
Offered Securities for sale under the laws of such jurisdictions in the
United States as CSFBC designates in writing and will continue such
qualifications in effect so long as required for the distribution.
(g) During the period of five years hereafter, the Company
will furnish to the Representatives and, upon request, to each of the
other Underwriters, as soon as practicable after the end of each fiscal
year, a copy of its annual report to stockholders for such year; and
the Company will furnish to the Representatives (i) as soon as
available, a copy of each report and any definitive proxy statement of
the Company filed with the Commission under the Securities Exchange Act
of 1934 or mailed to stockholders, and (ii) from time to time, such
other information concerning the Company as CSFBC may reasonably
request.
(h) The Company and the Selling Stockholder agree with the
several Underwriters that the Company and the Selling Stockholder will
pay all expenses incident to the performance of its obligations under
this Agreement, for any filing fees and other expenses (including fees
and disbursements of counsel) in connection with qualification of the
Offered Securities for sale under the laws of such jurisdictions in the
United States as CSFBC designates in writing and the printing of
memoranda relating thereto, and the reasonable fees and disbursements
of counsel to the Underwriters in connection with, the review by the
National Association of Securities Dealers, Inc. of the Offered
Securities, for any travel expenses of the Company's officers and
employees and any other expenses of the Company in connection with
attending or hosting meetings with prospective purchasers of the
Offered Securities and for expenses incurred in distributing
preliminary prospectuses and the Prospectuses (including any amendments
and supplements thereto) to the Underwriters.
9
(i) For a period of 180 days after the date of the initial
public offering of the Offered Securities, the Company will not offer,
sell, contract to sell, pledge or otherwise dispose of, directly or
indirectly, or file with the Commission a registration statement under
the Act relating to, any additional shares of its Securities or
securities convertible into or exchangeable or exercisable for any
shares of its Securities, or publicly disclose the intention to make
any such offer, sale, pledge, disposition or filing, without the prior
written consent of CSFBC except grants of employee stock options
pursuant to the terms of a plan in effect on the date hereof, issuances
of Securities pursuant to the exercise of such options or the exercise
of any other employee stock options outstanding on the date hereof.
6. Conditions of the Obligations of the Underwriters. The obligations
of the several Underwriters to purchase and pay for the U.S. Firm Securities on
the First Closing Date and the U.S. Optional Securities to be purchased on each
Optional Closing Date will be subject to the accuracy of the representations and
warranties on the part of the Company and the Selling Stockholder herein, to the
accuracy of the statements of Company officers and the Selling Stockholder made
pursuant to the provisions hereof, to the performance by the Company and the
Selling Stockholder of their obligations hereunder and to the following
additional conditions precedent:
(a) The Representatives shall have received a letter, dated
the date of delivery thereof (which, if the Effective Time of the
Initial Registration Statement is prior to the execution and delivery
of this Agreement, shall be on or prior to the date of this Agreement
or, if the Effective Time of the Initial Registration Statement is
subsequent to the execution and delivery of this Agreement, shall be
prior to the filing of the amendment or post-effective amendment to the
registration statement to be filed shortly prior to such Effective
Time), of KPMG Peat Marwick LLP confirming that they are independent
public accountants within the meaning of the Act and the applicable
published Rules and Regulations thereunder and stating to the effect
that:
(i) in their opinion the financial statements and
schedules examined by them and included in the Registration
Statements comply as to form in all material respects with the
applicable accounting requirements of the Act and the related
published Rules and Regulations;
(ii) they have performed the procedures specified by
the American Institute of Certified Public Accountants for a
review of interim financial information as described in
Statement of Auditing Standards No. 71, Interim Financial
Information, on the unaudited financial statements included in
the Registration Statements;
(iii) on the basis of the review referred to in
clause (ii) above, a reading of the latest available interim
financial statements of the Company, inquiries of officials of
the Company who have responsibility for financial and
accounting matters and other specified procedures, nothing
came to their attention that caused them to believe that:
(A) the unaudited financial statements
included in the Registration Statements do not comply
as to form in all material respects with the
applicable accounting requirements of the Act and the
related published Rules and Regulations or any
material modifications should be made to such
unaudited financial statements for them to be in
conformity with generally accepted accounting
principles;
(B) the unaudited consolidated net sales,
operating income, net income and (loss) earnings per
common share amounts for the six-month periods ended
March 31, 1997 and March 31, 1998 included in the
Prospectuses do not agree with the amounts set forth
in the unaudited consolidated financial statements
for
10
those same periods or were not determined on a basis
substantially consistent with that of the
corresponding amounts in the audited consolidated
statements of income;
(C) at the date of the latest available
balance sheet read by such accountants, or at a
subsequent specified date not more than three
business days prior to the date of this Agreement,
there was any change in the capital stock or any
increase in short-term indebtedness or long-term debt
of the Company and its consolidated subsidiaries or,
at the date of the latest available balance sheet
read by such accountants, there was any decrease in
consolidated total assets or stockholders' equity, as
compared with amounts shown on the latest balance
sheet included in the Prospectuses;
(D) for the period from the closing date of
the latest income statement included in the
Prospectuses to the closing date of the latest
available income statement read by such accountants
there were any decreases, as compared with the
corresponding period of the previous year and with
the period of corresponding length ended the date of
the latest income statement included in the
Prospectuses, in consolidated net sales or operating
income, or in the total or per share amounts of
[consolidated income before extraordinary items] or
net income; or
(E) the unaudited pro forma financial
statements included in the Registration Statements do
not comply as to form in all material respects with
the applicable accounting requirements of Rule 11-02
of Regulation S-X and the pro forma adjustments have
not been arithmetically accurately applied to the
historical amounts in the compilation of those
statements,
except in all cases set forth in clauses (C) and (D) above for
changes, increases or decreases which the Prospectuses
disclose have occurred or may occur or which are described in
such letter; and
(iv) they have compared specified dollar amounts (or
percentages derived from such dollar amounts) and other
financial information contained in the Registration Statements
(in each case to the extent that such dollar amounts,
percentages and other financial information are derived from
the general accounting records of the Company and its
subsidiaries subject to the internal controls of the Company's
accounting system or are derived directly from such records by
analysis or computation) with the results obtained from
inquiries, a reading of such general accounting records and
other procedures specified in such letter and have found such
dollar amounts, percentages and other financial information to
be in agreement with such results, except as otherwise
specified in such letter.
For purposes of this subsection, (i) if the Effective Time of the
Initial Registration Statement is subsequent to the execution and
delivery of this Agreement, "Registration Statements" shall mean the
initial registration statement as proposed to be amended by the
amendment or post-effective amendment to be filed shortly prior to its
Effective Time, (ii) if the Effective Time of the Initial Registration
Statement is prior to the execution and delivery of this Agreement but
the Effective Time of the Additional Registration is subsequent to such
execution and delivery, "Registration Statements" shall mean the
Initial Registration Statement and the additional registration
statement as proposed to be filed or as proposed to be amended by the
post-effective amendment to be filed shortly prior to its Effective
Time, and (iii) "Prospectuses" shall mean the prospectuses included in
the Registration Statements.
11
(b) If the Effective Time of the Initial Registration
Statement is not prior to the execution and delivery of this Agreement,
such Effective Time shall have occurred not later than 10:00 P.M., New
York time, on the date of this Agreement or such later date as shall
have been consented to by CSFBC. If the Effective Time of the
Additional Registration Statement (if any) is not prior to the
execution and delivery of this Agreement, such Effective Time shall
have occurred not later than 10:00 P.M., New York time, on the date of
this Agreement or, if earlier, the time either Prospectus is printed
and distributed to any Underwriter or Manager, or shall have occurred
at such later date as shall have been consented to by CSFBC. If the
Effective Time of the Initial Registration Statement is prior to the
execution and delivery of this Agreement, each of the Prospectuses
shall have been filed with the Commission in accordance with the Rules
and Regulations and Section 5(a) of this Agreement. Prior to such
Closing Date, no stop order suspending the effectiveness of a
Registration Statement shall have been issued and no proceedings for
that purpose shall have been instituted or, to the knowledge of the
Company or the Representatives, shall be contemplated by the
Commission.
(c) Subsequent to the execution and delivery of this
Agreement, there shall not have occurred (i) any change, or any
development or event involving a prospective change, in the condition
(financial or other), business, properties or results of operations of
the Company or its subsidiaries which, in the judgment of a majority in
interest of the Underwriters including the Representatives, is material
and adverse and makes it impractical or inadvisable to proceed with
completion of the public offering or the sale of and payment for the
U.S. Securities; (ii) any downgrading in the rating of any debt
securities of the Company by any "nationally recognized statistical
rating organization" (as defined for purposes of Rule 436(g) under the
Act), or any public announcement that any such organization has under
surveillance or review its rating of any debt securities of the Company
(other than an announcement with positive implications of a possible
upgrading, and no implication of a possible downgrading, of such
rating); (iii) any suspension or limitation of trading in securities
generally on the New York Stock Exchange, or any setting of minimum
prices for trading on such exchange, or any suspension of trading of
any securities of the Company on any exchange or in the
over-the-counter market; (iv) any banking moratorium declared by U.S.
Federal or New York authorities; or (v) any outbreak or escalation of
major hostilities in which the United States is involved, any
declaration of war by Congress or any other substantial national or
international calamity or emergency if, in the judgment of a majority
in interest of the Underwriters including the Representatives, the
effect of any such outbreak, escalation, declaration, calamity or
emergency makes it impractical or inadvisable to proceed with
completion of the public offering or the sale of and payment for the
U.S. Securities.
(d) The Representatives shall have received an opinion, dated
such Closing Date, of Proskauer Rose LLP, counsel for the Company,
substantially in the form attached hereto as Exhibit A, and, in the
case of clause (i) to the extent relating to subsidiaries organized in
a jurisdiction outside of the United States, and clause (ii)(A) and (C)
of such other counsel for the Company acceptable to the Representatives
and, in the case of clause (ii)(B), of Xxxxx X. Xxxxx, counsel to the
Company, to the effect that:
(i) Each Specified Subsidiary (as defined below) of
the Company has been duly organized and is an existing
corporation or other legal entity as specified in such opinion
in good standing under the laws of the jurisdiction of its
incorporation, with power and authority (corporate and other)
to own its properties and conduct its business as described in
the Prospectuses; and each Specified Subsidiary of the Company
is duly qualified to do business as a foreign corporation or
other such entity in good standing in all other jurisdictions
in which its ownership or lease of property or the conduct of
its business requires such qualification; all of the issued
and outstanding capital stock or other equity interests of
each Specified Subsidiary of the Company has been duly
authorized and validly issued and is fully paid and
nonassessable; and the capital stock or other equity interests
of each Specified Subsidiary owned by the Company directly, or
through subsidiaries, is owned
12
free from liens, encumbrances and defects (as used herein,
"Specified Subsidiary" means those subsidiaries of the Company
listed on Schedule B hereto); and
(ii) The execution, delivery and performance of this
Agreement and the Subscription Agreement and the issuance and
sale of the Offered Securities will not result in a breach or
violation of any of the terms and provisions of, or constitute
a default under (A) any statute, rule or regulation applicable
to any Specified Subsidiary, or (B) any agreement or
instrument listed as an Exhibit to the Registration Statement,
or (C) the charter or by-laws of any Specified Subsidiary.
(e) The Representatives shall have received the opinion
contemplated in the Power of Attorney executed and delivered by the
Selling Stockholder and an opinion, dated such Closing Date, of
________, counsel for the Selling Stockholder, to the effect that:
(i) The Selling Stockholder had valid and
unencumbered title to the Offered Securities delivered by the
Selling Stockholder on such Closing Date and had full right,
power and authority to sell, assign, transfer and deliver the
Offered Securities delivered by the Selling Stockholder on
such Closing Date hereunder and the several Underwriters have
acquired valid and unencumbered title to the Offered
Securities purchased by them from the Selling Stockholder on
such Closing Date hereunder;
(ii) No consent, approval, authorization or order of,
or filing with, any governmental agency or body or any court
is required to be obtained or made by the Selling Stockholder
for the consummation of the transactions contemplated by the
Custody Agreement or this Agreement in connection with the
sale of the Offered Securities sold by the Selling
Stockholder, except such as have been obtained and made under
the Act and such as may be required under state securities
laws;
(iii) The execution, delivery and performance of the
Custody Agreement and this Agreement and the consummation of
the transactions therein and herein contemplated will not
result in a breach or violation of any of the terms and
provisions of, or constitute a default under, any statute, any
rule, regulation or order of any governmental agency or body
or any court having jurisdiction over the Selling Stockholder
or any of its properties or any agreement or instrument to
which the Selling Stockholder is a party or by which the
Selling Stockholder is bound or to which any of the properties
of the Selling Stockholder is subject, or the charter or
by-laws of the Selling Stockholder;
(iv) The Power of Attorney and related Custody
Agreement with respect to the Selling Stockholder have been
duly authorized, executed and delivered by the Selling
Stockholder and constitute valid and legally binding
obligations of the Selling Stockholder enforceable in
accordance with their terms, subject to bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium
and similar laws of general applicability relating to or
affecting creditors' rights and to general equity principles;
and
(v) This Agreement has been duly authorized, executed
and delivered by the Selling Stockholder.
(f) The Representatives shall have received from Winthrop,
Stimson, Xxxxxx & Xxxxxxx, counsel for the Underwriters, such opinion
or opinions, dated such Closing Date, with respect to the incorporation
of the Company, the validity of the Offered Securities delivered on
such Closing Date, the Registration Statements, the Prospectuses and
other related matters as the Representatives may require, and the
Selling Shareholders and the Company shall have furnished to such
counsel such documents as they reasonably request for the purpose of
enabling them to pass upon such matters.
13
(g) The Representatives shall have received a certificate,
dated such Closing Date, of the President or any Vice President and a
principal financial or accounting officer of the Company in which such
officers, to the best of their knowledge after reasonable
investigation, shall state that: the representations and warranties of
the Company in this Agreement are true and correct; the Company has
complied with all agreements and satisfied all conditions on its part
to be performed or satisfied hereunder at or prior to such Closing
Date; no stop order suspending the effectiveness of any Registration
Statement has been issued and no proceedings for that purpose have been
instituted or are contemplated by the Commission; the Additional
Registration Statement (if any) satisfying the requirements of
subparagraphs (1) and (3) of Rule 462(b) was filed pursuant to Rule
462(b), including payment of the applicable filing fee in accordance
with Rule 111(a) or (b) under the Act, prior to the time either
Prospectus was printed and distributed to any Underwriter or Manager;
and, subsequent to the date of the most recent financial statements in
the Prospectuses, there has been no material adverse change, nor any
development or event involving a prospective material adverse change,
in the condition (financial or other), business, properties or results
of operations of the Company and its subsidiaries taken as a whole
except as set forth in or contemplated by the Prospectuses or as
described in such certificate.
(h) The Representatives shall have received a letter, dated
such Closing Date, of KPMG Peat Marwick LLP which meets the
requirements of subsection (a) of this Section, except that the
specified date referred to in such subsection will be a date not more
than three business days prior to such Closing Date for the purposes of
this subsection.
(i) On such Closing Date, the Managers shall have purchased
the International Firm Securities or the International Optional
Securities, as the case may be, pursuant to the Subscription Agreement.
The Selling Stockholder and the Company will furnish the Representatives with
such conformed copies of such opinions, certificates, letters and documents as
the Representatives reasonably request. CSFBC may in its sole discretion waive
on behalf of the Underwriters compliance with any conditions to the obligations
of the Underwriters hereunder, whether in respect of an Optional Closing Date or
otherwise.
7. Indemnification and Contribution. (a) The Company will indemnify and
hold harmless each Underwriter against any losses, claims, damages or
liabilities, joint or several, to which such Underwriter may become subject,
under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon any
untrue statement or alleged untrue statement of any material fact contained in
any Registration Statement, either of the Prospectuses, or any amendment or
supplement thereto, or any related preliminary prospectus, 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, and will reimburse each Underwriter for any legal or other expenses
reasonably incurred by such Underwriter in connection with investigating or
defending any such loss, claim, damage, liability or action as such expenses are
incurred; provided, however, that the Company will not be liable in any such
case to the extent that any such loss, claim, damage or liability arises out of
or is based upon an untrue statement or alleged untrue statement in or omission
or alleged omission from any of such documents in reliance upon and in
conformity with written information furnished to the Company by any Underwriter
through the Representatives specifically for use therein, it being understood
and agreed that the only information furnished by any Underwriter consists of
the information described as such in subsection (c) below.
(b) The Selling Stockholder will indemnify and hold harmless each
Underwriter against any losses, claims, damages or liabilities, joint or
several, to which such Underwriter may become subject, under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon any untrue statements or alleged
untrue statement of any material fact contained in any
14
Registration Statement, the Prospectus, or any amendment or supplement thereto,
or any related preliminary prospectus, 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, and
will reimburse each Underwriter for any legal or other expenses reasonably
incurred by such Underwriter in connection with investigating or defending any
such loss, claim, damage, liability or action as such expenses are incurred;
provided, however, that the Selling Stockholder will not be liable in any such
case to the extent that any such loss, claim, damage or liability arises out of
or is based upon an untrue statement or alleged untrue statement in or omission
or alleged omission from any of such documents in reliance upon and in
conformity with written information furnished to the Company by an Underwriter
through the Representatives specifically for use therein, it being understood
and agreed that the only such information furnished by any Underwriter consists
of the information described as such in subsection (c) below. In no event,
however, shall the liability of the Selling Stockholder for indemnification
under this Section 7(b) exceed the total net proceeds received by such Selling
Stockholder from the Underwriters in the offering of the Offered Securities.
(c) Each Underwriter will severally and not jointly indemnify and hold
harmless the Company and the Selling Stockholder against any losses, claims,
damages or liabilities to which the Company or the Selling Stockholder may
become subject, under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are based
upon any untrue statement or alleged untrue statement of any material fact
contained in any Registration Statement, either of the Prospectuses, or any
amendment or supplement thereto, or any related preliminary prospectus, or arise
out of or are based upon the omission or the 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
such untrue statement or alleged untrue statement or omission or alleged
omission was made in reliance upon and in conformity with written information
furnished to the Company by such Underwriter through the Representatives
specifically for use therein, and will reimburse any legal or other expenses
reasonably incurred by the Company and the Selling Stockholder in connection
with investigating or defending any such loss, claim, damage, liability or
action as such expenses are incurred, it being understood and agreed that the
only such information furnished by any Underwriter consists of the following
information in the U.S. Prospectus furnished on behalf of each Underwriter: the
last paragraph at the bottom of the cover page concerning the terms of the
offering by the Underwriters, the legend concerning over-allotments, stabilizing
transactions, syndicate short covering transactions and penalty bids on the
inside front cover page and the concession and reallowance figures appearing in
the fifth paragraph under the caption "Underwriting" and the information
concerning discretionary sales contained in the eleventh paragraph under the
caption "Underwriting".
(d) Promptly after receipt by an indemnified party under this Section
of notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against the indemnifying party under
subsection (a), (b) or (c) above, notify the indemnifying party of the
commencement thereof; but the omission so to notify the indemnifying party will
not relieve it from any liability which it may have to any indemnified party
otherwise than under subsection (a), (b) or (c) above. In case any such action
is brought against any indemnified party and it notifies the indemnifying party
of the commencement thereof, the indemnifying party will be entitled to
participate therein and, to the extent that it may wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof, with
counsel satisfactory to such indemnified party (who shall not, except with the
consent of the indemnified party, be counsel to the indemnifying party), and
after notice from the indemnifying party to such indemnified party of its
election so to assume the defense thereof, the indemnifying party will not be
liable to such indemnified party under this Section, for any legal or other
expenses subsequently incurred by such indemnified party in connection with the
defense thereof other than reasonable costs of investigation. No indemnifying
party shall, without the prior written consent of the indemnified party, effect
any settlement of any pending or threatened action in respect of which any
indemnified party is or could have been a party and indemnity could have been
sought hereunder by such indemnified party unless such settlement includes an
unconditional release of such indemnified party from all liability on any claims
that are the subject matter of such action.
15
(e) If the indemnification provided for in this Section is unavailable
or insufficient to hold harmless an indemnified party under subsection (a), (b)
or (c) above, then each indemnifying party shall contribute to the amount paid
or payable by such indemnified party as a result of the losses, claims, damages
or liabilities referred to in subsection (a), (b) or (c) above (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Company and the Selling Stockholder on the one hand and the Underwriters on the
other from the offering of the U.S. Securities or (ii) if the allocation
provided by clause (i) above is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits referred
to in clause (i) above but also the relative fault of the Company and the
Selling Stockholder on the one hand and the Underwriters on the other in
connection with the statements or omissions which resulted in such losses,
claims, damages or liabilities as well as any other relevant equitable
considerations. The relative benefits received by the Company and the Selling
Stockholder on the one hand and the Underwriters on the other shall be deemed to
be in the same proportion as the total net proceeds from the offering of the
U.S. Securities (before deducting expenses) received by the Company and the
Selling Stockholder bear to the total underwriting discounts and commissions
received by the Underwriters. The relative fault 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 untrue statement or omission. The
amount paid by an indemnified party as a result of the losses, claims, damages
or liabilities referred to in the first sentence of this subsection (e) shall be
deemed to include any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any action or
claim which is the subject of this subsection (e). Notwithstanding the
provisions of this subsection (e), no Underwriter shall be required to
contribute any amount in excess of the amount by which the total price at which
the U.S. Securities underwritten by it and distributed to the public were
offered to the public exceeds the amount of any damages which such Underwriter
has otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations in this subsection (e) to
contribute are several in proportion to their respective underwriting
obligations and not joint.
(f) The obligations of the Company and the Selling Stockholder under
this Section shall be in addition to any liability which the Company and the
Selling Stockholder may otherwise have and shall extend, upon the same terms and
conditions, to each person, if any, who controls any Underwriter within the
meaning of the Act; and the obligations of the Underwriters under this Section
shall be in addition to any liability which the respective Underwriters may
otherwise have and shall extend, upon the same terms and conditions, to each
director of the Company, to each officer of the Company who has signed a
Registration Statement and to each person, if any, who controls the Company
within the meaning of the Act.
8. Default of Underwriters. If any Underwriter or Underwriters default
in their obligations to purchase U.S. Securities hereunder on either the First
or any Optional Closing Date and the aggregate number of shares of U.S.
Securities that such defaulting Underwriter or Underwriters agreed but failed to
purchase does not exceed 10% of the total number of shares of U.S. Securities
that the Underwriters are obligated to purchase on such Closing Date, CSFBC may
make arrangements satisfactory to the Company and the Selling Stockholder for
the purchase of such U.S. Securities by other persons, including any of the
Underwriters, but if no such arrangements are made by such Closing Date the
non-defaulting Underwriters shall be obligated severally, in proportion to their
respective commitments hereunder, to purchase the U.S. Securities that such
defaulting Underwriters agreed but failed to purchase on such Closing Date. If
any Underwriter or Underwriters so default and the aggregate number of shares of
U.S. Securities with respect to which such default or defaults occur exceeds 10%
of the total number of shares of U.S. Securities that the Underwriters are
obligated to purchase on such Closing Date and arrangements satisfactory to
CSFBC, the Company and the Selling Stockholder for the purchase of such U.S.
Securities by other persons are not made within 36 hours after such default,
this Agreement will terminate without liability on the part of any
non-defaulting Underwriter, the Company, or the Selling Stockholder, except as
provided in Section 9 (provided that if such default occurs
16
with respect to U.S. Optional Securities after the First Closing Date, this
Agreement will not terminate as to the U.S. Firm Securities or any U.S. Optional
Securities purchased prior to such termination). As used in this Agreement, the
term "Underwriter" includes any person substituted for an Underwriter under this
Section. Nothing herein will relieve a defaulting Underwriter from liability for
its default.
9. Survival of Certain Representations and Obligations. The respective
indemnities, agreements, representations, warranties and other statements of the
Selling Stockholder, of the Company or its officers and of the several
Underwriters set forth in or made pursuant to this Agreement will remain in full
force and effect, regardless of any investigation, or statement as to the
results thereof, made by or on behalf of any Underwriter, the Selling
Stockholder, the Company or any of their respective representatives, officers or
directors or any controlling person, and will survive delivery of and payment
for the U.S. Securities. If this Agreement is terminated pursuant to Section 8
or if for any reason the purchase of the U.S. Securities by the Underwriters is
not consummated, the Company and the Selling Stockholder shall remain
responsible for the expenses to be paid or reimbursed by it pursuant to Section
5 and the respective obligations of the Company, the Selling Stockholder, and
the Underwriters pursuant to Section 7 shall remain in effect and if any U.S.
Securities have been purchased hereunder the representations and warranties in
Section 2 and all obligations under Section 5 shall also remain in effect. If
the purchase of the U.S. Securities by the Underwriters is not consummated for
any reason other than solely because of the termination of this Agreement
pursuant to Section 8 or the occurrence of any event specified in clause (iii),
(iv) or (v) of Section 6(c) or the default or omission of any Underwriter, the
Company will reimburse the Underwriters for all reasonable out-of-pocket
expenses (including fees and disbursements of counsel) reasonably incurred by
them in connection with the offering of the U.S. Securities.
10. Notices. All communications hereunder will be in writing and, if
sent to the Underwriters, will be mailed, delivered or telegraphed and confirmed
to the Representatives, c/o Credit Suisse First Boston Corporation, Eleven
Madison Avenue, New York, N.Y. 10010-3629, Attention: Investment Banking
Department - Transactions Advisory Group, or, if sent to the Company, will be
mailed, delivered or telegraphed and confirmed to it at 000 Xxxxx Xxxxxx, Xxx
Xxxx, X.X. 00000, Attention: Xxxxx X. Xxxxx, Esq., or, if sent to the Selling
Stockholder, will be mailed, delivered or telegraphed and confirmed to Xxxxxxx
Xxxxxxxxxxx at 5-14, 2-chome, Xxxxxxxxxxx Xxxx-Xx, Xxxxx 000, Xxxxx; provided,
however, that any notice to an Underwriter pursuant to Section 7 will be mailed,
delivered or telegraphed and confirmed to such Underwriter.
11. Successors. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective personal representatives
and successors and the officers and directors and controlling persons referred
to in Section 7, and no other person will have any right or obligation
hereunder.
12. Representation. The Representatives will act for the several
Underwriters in connection with this financing, and any action under this
Agreement taken by the Representatives jointly or by CSFBC will be binding upon
all the Underwriters.
13. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such
counterparts shall together constitute one and the same Agreement.
14. Applicable Law. This Agreement shall be governed by, and construed
in accordance with, the laws of the State of New York, without regard to
principles of conflicts of laws.
The Company and the Selling Stockholder hereby submit to the
non-exclusive jurisdiction of the Federal and state courts in the Borough of
Manhattan in the City of New York in any suit or proceeding arising out of or
relating to this Agreement or the transactions contemplated hereby.
17
The Selling Stockholder irrevocably appoints CT Corporation Systems,
Inc., as its authorized agent in the Borough of Manhattan in The City of New
York upon which process may be served in any such suit or proceeding, and agrees
that service of process upon such agent, and written notice of said service to
the Selling Stockholder by the person serving the same to the address provided
in Section 10 shall be deemed in every respect effective service of process upon
the Selling Stockholder in any such suit or proceeding. The Selling Stockholder
further agrees to take any and all action as may be necessary to maintain such
designation and appointment of such agent in full force and effect for a period
of seven years from the date of this Agreement.
18
If the foregoing is in accordance with the Representatives'
understanding of our agreement, kindly sign and return to the Company and the
Selling Stockholder one of the counterparts hereof, whereupon it will become a
binding agreement between the Company, the Selling Stockholder and the several
Underwriters in accordance with its terms.
Very truly yours,
HOSOKAWA MICRON INTERNATIONAL INC.
By
---------------------------------------------
[Insert title]
HOSOKAWA MICRON INTERNATIONAL INC.
By
---------------------------------------------
[Insert title]
The foregoing Underwriting Agreement is hereby confirmed
and accepted as of the date first above written.
CREDIT SUISSE FIRST BOSTON CORPORATION
PAINEWEBBER INCORPORATED
Acting on behalf of themselves and as
the Representatives of the several Underwriters.
By CREDIT SUISSE FIRST BOSTON CORPORATION
By
---------------------------------------------
[Insert title]
SCHEDULE A
Underwriter Number of Number of
----------- U.S. Firm Securities U.S. Firm Securities
from Company from Selling Stockholder
------------ ------------------------
Credit Suisse First Boston Corporation......................... [-] [-]
PaineWebber Incorporated....................................... [-] [-]
------------- ----------
Total............................... [-] [-]
============= ==========
SCHEDULE B
Corporation Jurisdiction
----------- ------------
Hosokawa Micron Ltd. (Canada) Canada
Hosokawa Micron International B.V. Netherlands
Hosokawa Micron B.V. Netherlands
Hosokawa Schugi B.V. Netherlands
Xxxxxxx-Xxxxxxxx B.V. Netherlands
Hosokawa Ter Braak B.V. Netherlands
Recomix B.V. Netherlands
Hosokawa Alpine Aktiengesellschaft Germany
Hosokawa Mikropul GmbH Germany
Hosokawa Bepex GmbH Germany
Hosokawa Unternehmens-Holding GmbH Germany
Hosokawa Xxxxxxx GmbH Germany
Hosokawa Xxxxx Ltd. United Kingdom
Hosokawa Micron Ltd. (U.K.) United Kingdom
Xxxxxxx-Xxxxxxxx Ltd. United Kingdom
Hosokawa Xxxxx Ltd. United Kingdom
Hosokawa Micron S.A. France
Hosokawa Micron Australia Pty., Ltd. Australia
Exhibit A to
Underwriting
Agreement
June __, 1998
CREDIT SUISSE FIRST BOSTON CORPORATION
PAINEWEBBER INCORPORATED
As representatives of the several
Underwriters named in Schedule A
c/o Credit Suisse First Boston Corporation
Eleven Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: Hosokawa Micron International Inc.
2,670,000 Shares of Common Stock
Dear Ladies and Gentlemen:
We have acted as counsel for Hosokawa Micron International Inc. a
Delaware corporation (the "Company"), in connection with the sale by the Company
and purchase of [ ] shares of Common Stock, par value $.01 per share, of the
Company (the "Shares") by the several Underwriters listed in Schedule A to the
underwriting agreement dated June __, 1998 among the Company, Hosokawa Micron
Corporation and Credit Suisse First Boston Corporation and PaineWebber
Incorporated, as representatives of the several named Underwriters (the
"Underwriting Agreement"), and [ ] Shares by the several Managers listed in
Schedule A to the subscription agreement dated June __, 1998 among the Company,
Hosokawa Micron Corporation and Credit Suisse First Boston (Europe) Limited and
PaineWebber International (U.K.) Ltd., as representatives of the several named
Managers (the "Subscription Agreement"). This opinion is being furnished
pursuant to Section 6(d) of the Underwriting Agreement and the Subscription
Agreement. All defined terms not defined in this opinion have the meanings
ascribed to them in the Underwriting Agreement.
We have participated in the preparation of the Underwriting Agreement,
the Subscription Agreement, the Registration Statement and the Prospectuses and
have
examined such certificates of public officials, corporate documents and
records and other certificates and instruments, and have made such other
investigation, as we have deemed necessary in connection with this opinion.
In giving this opinion, we have assumed the authenticity of all
documents and the genuineness of all signatures examined by us and have relied
upon certificates of state authorities as to matters within their jurisdiction
and, as to various questions of fact material to this opinion, upon certificates
of officers of the Company and on the representations and warranties of the
parties in the Underwriting Agreement and the Subscription Agreement.
We express no opinion as to matters arising under any law other than
the federal law of the United States, the law of the State of New York and the
General Corporation Law of the State of Delaware and do not purport to express
any opinion on the law of any other jurisdiction.
Based on and subject to the foregoing, we are of the opinion that:
1. The Company and each of the subsidiaries of the Company listed on
Schedule I to this opinion (the "Subsidiaries") (a) have been duly incorporated
and are existing as corporations in good standing under the law of their
respective jurisdictions of incorporation, (b) based on certificates of public
officials in the applicable jurisdictions, are duly qualified to do business and
are in good standing as foreign corporations in each jurisdiction set forth
beside their respective names on schedule I to this opinion and (c) have all
corporate power and authority necessary to own or hold their respective
properties and conduct their respective businesses as such are described in the
Prospectuses.
2. All the outstanding shares of Common Stock of the Company have been
duly and validly authorized and issued, are fully paid and non-assessable and
all the Shares to be issued and sold by the Company to the Underwriters and the
Managers pursuant to the Underwriting Agreement and the Subscription Agreement,
respectively, have been duly and validly authorized and, when delivered against
payment therefor as provided in the Underwriting Agreement and the Subscription
Agreement, will be duly and validly issued, fully paid and non-assessable; all
the issued shares of capital stock of each Subsidiary have been duly and validly
authorized and issued and are fully paid, non-assessable and held by the Company
or a subsidiary of the Company free and clear of any adverse claims (as defined
in article 8 of the New York Uniform Commercial Code), and all the issued and
outstanding shares of Common Stock of the Company, including the Shares, conform
in all material respects to the description thereof in the Prospectuses.
3. There are no preemptive rights to subscribe for or to purchase any
Shares pursuant to the Company's restated certificate of incorporation or
by-laws or any agreement or other instrument of which we have actual knowledge.
4. To the best of our actual knowledge, there are no legal or
governmental proceedings pending or threatened to which the Company or any of
the Subsidiaries is or
1
may be a party that are required to be disclosed in the Prospectuses and are not
so disclosed.
5. The Company has full corporate power and authority to enter into the
Underwriting Agreement and the Subscription Agreement and to perform its
obligations under the Underwriting Agreement and the Subscription Agreement
(including to issue, sell and deliver the Shares), and the Underwriting
Agreement and the Subscription Agreement have been duly authorized, executed and
delivered by the Company.
6. The execution, delivery and performance of the Underwriting
Agreement and the Subscription Agreement and the consummation of the
transactions contemplated by the Underwriting Agreement and the Subscription
Agreement will not result in a breach or violation of any terms or provisions
of, or constitute a default under any indenture, mortgage, deed of trust, note
agreement or other agreement or instrument listed on Schedule 2 to this opinion,
the certificate of incorporation, by-laws or other organizational documents of
the Company or any of the Subsidiaries or any United States federal or state of
New York law, rule or regulation, or, to the best of our actual knowledge, any
United States federal or state of New York court or governmental agency or body
having jurisdiction over the Company or any of the Subsidiaries or any of their
properties.
7. No consent, approval, authorization or order of, or filing with, any
United States court or governmental agency or body is required for the
consummation by the Company of the transactions contemplated by the Underwriting
Agreement and the Subscription Agreement, except as have been obtained under the
Securities Act or Securities Exchange Act of 1934 or as may be required under
the applicable rules of the National Association of Securities Dealers, Inc.
(the "NASD") or the securities or "Blue Sky" laws of any jurisdiction in
connection with the purchase and distribution of the Shares by the Underwriters.
8. The Registration Statement was declared effective under the
Securities Act as of June __, 1998, the Prospectuses were filed with the
Commission pursuant to Rule 424(b) of the Rules and Regulations on June __, 1998
and, to the best of our actual knowledge, no stop order suspending the
effectiveness of the Registration Statement has been issued and no proceeding
for that purpose is pending or threatened by the Commission.
9. The Registration Statement and the Prospectuses and any amendments
or supplements thereto as of their respective effective or issue dates (except
for the financial statements and other financial data included therein, as to
which we express no opinion) comply as to form in all material respects with the
requirements of the Securities Act and the Rules and Regulations.
10. To the best of our actual knowledge, other than as described in the
Prospectuses, there are no contracts, agreements or understandings between the
Company and any person granting such person the right (other than rights that
have been waived or satisfied) to require the Company to file a registration
statement under the Securities Act
2
with respect to any securities of the Company owned or to be owned by such
person or to require the Company to include such securities in the securities
registered pursuant to the Registration Statement or in any securities being
registered pursuant to any other registration statement filed by the Company
under the Securities Act.
11. The descriptions in the Registration Statement and Prospectuses of
United States federal and state of New York statutes, rules and regulations,
and, to the best of our actual knowledge, legal or governmental proceedings,
contracts and other documents are accurate and such descriptions fairly present
the information required to be disclosed; and, to the best of our actual
knowledge, there are no legal or governmental proceedings, United States federal
or State of New York statutes, rules or regulations or any contracts or
documents of a character required to be described in the Registration Statement
or Prospectus or to be filed as exhibits to the Registration Statement that are
not described and filed as required.
12. The Company is not, nor will it be immediately after receiving the
proceeds (the "proceeds")from the sale of the Shares or after the application of
the Proceeds as described in the Prospectuses, an "investment company" as such
term is defined in the Investment Company Act of 1940.
In addition, in the course of the preparation of the Registration
Statement and the Prospectuses, we have participated in conferences with
officers and representatives of the Company and with the Company's independent
accountants, at which conferences we made inquiries of such officers,
representatives and accountants and discussed the contents of the Registration
Statement and the Prospectuses and (without taking any further action to verify
independently the statements made in the Registration Statement and the
Prospectuses (except as we have considered appropriate) and, except as stated in
the foregoing opinion, without assuming responsibility for the accuracy,
completeness or fairness of such statements) nothing has come to our attention
that causes us to believe that either the Registration Statement in the form it
originally became effective or as of the Closing Date contained or contains any
untrue statement of a material fact or omitted or omits to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading or that the Prospectuses as of their date or at the Closing Date
contained or contain any untrue statement of a material fact or omitted or omit
to state a material fact necessary in order to make the statements therein, in
light of the circumstances under which they were made, not misleading (it being
understood that we make no statement with respect to the financial statements,
schedules and other financial and statistical data included in or omitted from
the Registration Statement or the Prospectuses).
This opinion is solely for your benefit in connection with the
Underwriting Agreement and the Subscription Agreement and related matters, and
may not be relied upon by, nor may copies be delivered to, any other person or
entity for any purpose without our prior written consent in each instance.
Very truly yours,
3
