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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) February 27, 1997
1-5482
(Commission File Number)
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TYCO INTERNATIONAL LTD.
(Exact name of registrant as specified in its charter)
Massachusetts 04-2297459
(State of Incorporation) (IRS Employer
Identification Number)
One Tyco Park, Exeter, New Hampshire 03833
(Address of registrant's principal executive office)
603-778-9700
(Registrant's telephone number)
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<PAGE>
ITEM 5. Other Events
Under the terms and subject to the conditions contained in the United
States purchase agreement (the "U.S. Purchase Agreement"), dated February 27,
1997, Tyco International Ltd. (the "Company") has agreed to sell to Merrill
Lynch, Pierce, Fenner & Smith Incorporated, Credit Suisse First Boston
Corporation, Lehman Brothers Inc. and J.P. Morgan Securities Inc. (the "U.S.
Underwriters") 8,000,000 shares of the Company's Common Stock, par value $.50
per share ("Common Stock"). Concurrently with such sale and under the terms of
the International purchase agreement of even date therewith (the "International
Purchase Agreement, and together with the U.S. Purchase Agreement, the
"Underwriting Agreements"), the Company has agreed to sell to Merrill Lynch
International, Credit Suisse First Boston (Europe) Limited, Lehman Brothers
International (Europe) and J.P. Morgan Securities Ltd. (the "International
Managers") 2,000,000 shares of Common Stock. The Common Stock is being offered
to the public by the U.S. Underwriters in the United States and Canada, and by
the International Managers outside of the United States and Canada, at an
initial price of $57.75 per share of Common Stock.
The foregoing description is qualified in its entirety by reference to
the full text of the Underwriting Agreements which are appended hereto as
Exhibits 1.1 and 1.2 and are incorporated herein by reference.
ITEM 7. Financial Statements, Pro Forma Financial Information and Exhibits
(c) Exhibits.
Exhibit Number Title
- -------------- -----
1.1 Purchase Agreement, dated February 27, 1997,
between Tyco International Ltd. and Merrill Lynch,
Pierce, Fenner & Smith Incorporated, Credit Suisse First
Boston Corporation, Lehman Brothers Inc. and J.P.
Morgan Securities Inc.
1.2 Purchase Agreement, dated February 27, 1997, between Tyco
International Ltd. and Merrill Lynch International, Credit Suisse
First Boston (Europe) Limited, Lehman Brothers International
(Europe) and J.P. Morgan Securities Ltd.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
TYCO INTERNATIONAL LTD.
By: /s/ Mark H. Swartz
----------------------
Mark H. Swartz
Vice President - Chief Financial Officer
Date: March 3, 1997
<PAGE>
Exhibit Index
Exhibit Number Title Page
- -------------- ----- ----
1.1 Purchase Agreement, dated February 27, 1997,
between Tyco International Ltd. and Merrill Lynch,
Pierce, Fenner & Smith Incorporated, Credit Suisse
First Boston Corporation, Lehman Brothers Inc. and
J.P. Morgan Securities Inc.
1.2 Purchase Agreement, dated February 27, 1997, between
Tyco International Ltd. and Merrill Lynch International,
Credit Suisse First Boston (Europe) Limited, Lehman
Brothers International (Europe) and J.P. Morgan
Securities Ltd.
================================================================================
TYCO INTERNATIONAL LTD.
(a Massachusetts corporation)
8,000,000 Shares of Common Stock
U.S. PURCHASE AGREEMENT
Dated: February 27, 1997
================================================================================
<PAGE>
Table of Contents
U.S. PURCHASE AGREEMENT...................................................... 1
SECTION 1. Representations and Warranties........................... 4
(a) Representations and Warranties by the Company........ 4
(i) Compliance with Registration Requirements............ 4
(ii) Incorporated Documents.............................. 5
(iii) Independent Accountants............................ 5
(iv) Financial Statements................................ 5
(v) No Material Adverse Change in Business............... 6
(vi) Good Standing of the Company........................ 6
(vii) Good Standing of Subsidiaries...................... 6
(viii) Capitalization.................................... 7
(ix) Authorization of Agreement.......................... 7
(x) Authorization and Description of Securities.......... 7
(xi) Absence of Defaults and Conflicts................... 7
(xii) Absence of Labor Dispute........................... 8
(xiii) Absence of Proceedings............................ 8
(xiv) Accuracy of Exhibits.............................. 9
(xiv) Absence of Further Requirements................... 9
(xvi) Compliance with Cuba Act........................... 9
(xvii) Investment Company Act............................ 9
(b) Officer's Certificates............................... 9
SECTION 2. Sale and Delivery to U.S. Underwriters; Closing.......... 9
(a) Initial Securities....................................... 9
(b) Option Securities....................................... 10
(c) Payment................................................. 10
(d) Denominations; Registration............................. 11
SECTION 3. Covenants of the Company................................ 11
(a) Compliance with Securities Regulations and Commission
Requests................................................ 11
(b) Filing of Amendments............................... 11
(c) Delivery of Registration Statements..................... 12
(d) Delivery of Prospectuses................................ 12
(e) Continued Compliance with Securities Laws.......... 12
(f) Blue Sky Qualifications................................. 13
(g) Rule 158 ............................................... 13
(h) Use of Proceeds......................................... 13
(i) Listing............................................ 13
(j) Restriction on Sale of
Securities.............................................. 13
(k) Reporting Requirements.................................. 14
SECTION 4. Payment of Expenses..................................... 14
(a) Expenses................................................ 14
(b) Termination of Agreement................................ 14
SECTION 5. Conditions of U.S. Underwriters' Obligations............ 15
(a) Effectiveness of Registration Statement................. 15
(b) Opinion of General Counsel of Company................... 15
(c) Opinion of Counsel for Company.......................... 15
(d) Opinion of Counsel for U.S. Underwriters................ 15
(e) Officers' Certificate................................... 16
(f) Accountant's Comfort Letter............................. 16
(g) Bring-down Comfort Letter............................... 16
<PAGE>
(h) Approval of Listing..................................... 17
(i) Lock up Agreements...................................... 17
(j) Indemnification Agreement............................... 17
(k) Certificate of Chief Financial Officer.................. 17
(l) Purchase of Initial International
Securities.............................................. 17
(m) Conditions to Purchase of U.S. Option Securities... 17
(n) Additional Documents............................... 18
(o) Termination of Agreement................................ 18
SECTION 6. Indemnification......................................... 19
(a) Indemnification of U.S. Underwriters.................... 19
(b) Indemnification of Company, Directors and Officers. 20
(c) Actions against Parties; Notification.............. 20
(d) Settlement without Consent if Failure to Reimburse. 21
SECTION 7. Contribution ........................................... 21
SECTION 8. Representations, Warranties and Agreements to Survive
Delivery............................................... 23
SECTION 9. Termination of Agreement................................ 23
(a) Termination; General............................... 23
(b) Liabilities. 23
SECTION 10. Default by One or More of the U.S. Underwriters......... 23
SECTION 11. Notices 24
SECTION 12. Parties 24
SECTION 13. GOVERNING LAW AND TIME.................................. 24
SECTION 14. Effect of Headings...................................... 24
SCHEDULES
Schedule A - List of Underwriters .............................. Sch A-1
Schedule B - Pricing Information ............................... Sch B-1
Schedule C - List of Persons subject to Lock-up ................ Sch C-1
EXHIBITS
Exhibit A-1 - Form of Opinion of General Counsel of Company..... A-1-1
Exhibit A-2 - Form of Opinion of Company's Counsel ............. A-2-1
Exhibit B - Form of Lock-up Letter ............................. B-1
<PAGE>
TYCO INTERNATIONAL LTD.
(a Massachusetts corporation)
8,000,000 Shares of Common Stock
(Par Value $.50 Per Share)
U.S. PURCHASE AGREEMENT
-----------------------
February 27, 1997
MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
Credit Suisse First Boston Corporation
J.P. Morgan Securities Inc.
Lehman Brothers Inc.
as U.S. Representatives of the several U.S. Underwriters
c/o Merrill Lynch & Co.
Incorporated
North Tower
World Financial Center
New York, New York 10281-1209
Ladies and Gentlemen:
Tyco International Ltd., a Massachusetts corporation (the "Company"),
confirms its agreement with Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner &
Smith Incorporated ("Merrill Lynch") and each of the other U.S. Underwriters
named in Schedule A hereto (collectively, the "U.S. Underwriters", which term
shall also include any underwriter substituted as hereinafter provided in
Section 10, hereof), for whom Merrill Lynch, Credit Suisse First Boston
Corporation, Lehman Brothers Inc. and J.P. Morgan Securities Inc. are acting as
representatives (in such capacity, the "U.S. Representatives"), with respect to
the issue and sale by the Company and the purchase by the U.S. Underwriters,
acting severally and not jointly, of the respective numbers of shares of Common
Stock, par value $.50 per share, of the Company ("Common Stock") set forth in
said Schedule A, and with respect to the grant by the Company to the U.S.
Underwriters, acting severally and not jointly, of the option described in
Section 2(b) hereof to purchase all or any part of 1,200,000 additional shares
of Common Stock to cover over-allotments, if any. The aforesaid 8,000,000 shares
of Common Stock (the "Initial U.S. Securities") to be purchased by the U.S.
Underwriters and all or any part of the 1,200,000
<PAGE>
shares of Common Stock subject to the option described in Section 2(b) hereof
(the "U.S. Option Securities") are hereinafter called, collectively, the "U.S.
Securities."
It is understood that the Company is concurrently entering into an
agreement dated the date hereof (the "International Purchase Agreement")
providing for the offering by the Company of an aggregate of 2,000,000 shares of
Common Stock (the "Initial International Securities") through arrangements with
certain underwriters outside the United States and Canada (the "International
Managers") for whom Merrill Lynch International, Credit Suisse First Boston
(Europe) Limited, Lehman Brothers International (Europe) and J.P. Morgan
Securities Ltd. are acting as lead managers (the "Lead Managers") and the grant
by the Company to the International Managers, acting severally and not jointly,
of an option to purchase all or any part of the International Managers' pro rata
portion of up to 300,000 additional shares of Common Stock solely to cover
overallotments, if any (the "International Option Securities"). The Initial
International Securities and the International Option Securities are hereinafter
called the "International Securities." It is understood that the Company is not
obligated to sell and the U.S. Underwriters are not obligated to purchase, any
Initial U.S. Securities unless all of the Initial International Securities are
contemporaneously purchased by the International Managers.
The U.S. Underwriters and the International Managers are hereinafter
collectively called the "Underwriters," the Initial U.S. Securities and the
Initial International Securities are hereinafter collectively called the
"Initial Securities," the U.S. Securities and the International Securities are
hereinafter collectively called the "Securities" and the U.S. Option Securities
and the International Option Securities are hereinafter collectively called the
"Option Securities."
The Underwriters will concurrently enter into an Intersyndicate Agreement
of even date herewith (the "Intersyndicate Agreement") providing for the
coordination of certain transactions among the Underwriters under the direction
of Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated (in
such capacity, the "Global Coordinator").
The Company understands that the U.S. Underwriters propose to make a public
offering of the U.S. Securities as soon as the U.S. Representatives deem
advisable after this Agreement has been executed and delivered.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (No. 333-20741) covering the
registration of the Securities under the Securities Act of 1933, as amended (the
"1933 Act"), and the offering thereof from time to time in accordance with Rule
415 of the rules and regulations of the Commission under the 1933 Act (the "1933
Act Regulations"). Such registration statement (as amended, if applicable) has
been declared effective by the Commission (any preliminary prospectus included
in such registration statement or filed with the Commission pursuant to Rule
424(a) of the rules and regulations of the 1933 Act Regulations or any
preliminary prospectus supplement specifically relating to the Securities filed
with the Commission pursuant to Rule 424(b) of the 1933 Act Regulations being
hereinafter called a "Preliminary Prospectus"). The information included in any
such prospectus or in any such Term Sheet, as the case may be, that was omitted
from such registration statement at the time it became effective but that is
deemed to
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be part of such registration statement at the time it became effective (a)
pursuant to paragraph (b) of Rule 430A is referred to as "Rule 430A Information"
or (b) pursuant to paragraph (d) of Rule 434 is referred to as "Rule 434
Information." Any registration statement filed pursuant to Rule 462(b) of the
1933 Act Regulations is herein referred to as the "Rule 462(b) Registration
Statement," and after such filing the term "Registration Statement" shall
include the Rule 462(b) Registration Statement. Such registration statement and
any post effective amendment thereto and the prospectus constituting a part
thereof, and each prospectus supplement relating to the offering of Securities
(the "Prospectus Supplement"), including all documents incorporated therein by
reference, and including the Rule 430A Information and the Rule 434 Information,
as applicable, as from time to time amended or supplemented pursuant to the 1933
Act, the Securities Exchange Act of 1934, as amended (the "1934 Act") or
otherwise, are collectively referred to herein as the "Registration Statement"
and the "Prospectus," respectively; provided, that a Prospectus Supplement shall
be deemed to have supplemented the Prospectus only with respect to the offering
of Securities to which it relates. Any registration statement filed pursuant to
Rule 462(b) of the 1933 Act Regulations is herein referred to as the "Rule
462(b) Registration Statement," and after such filing the term "Registration
Statement" shall include the Rule 462(b) Registration Statement. Promptly after
execution and delivery of this Agreement, the Company will either (i) prepare
and file a prospectus in accordance with the provisions of Rule 430A ("Rule
430A") of the rules and regulations of the Commission under the 1933 Act (the
"1933 Act Regulations") and paragraph (b) of Rule 424 ("Rule 424(b)") of the
1933 Act Regulations or (ii) if the Company has elected to rely upon Rule 434
("Rule 434") of the 1933 Act Regulations, prepare and file a term sheet (a "Term
Sheet") in accordance with the provisions of Rule 434 and Rule 424(b). Two forms
of prospectus supplement are to be used in connection with the offering and sale
of the Securities: one relating to the U.S. Securities (the "Form of U.S.
Prospectus Supplement") and one relating to the International Securities (the
"Form of International Prospectus Supplement"). The Form of International
Prospectus Supplement is identical to the Form of U.S. Prospectus Supplement,
except for the front cover and back cover pages and the information under the
caption "Underwriting" and the inclusion in the Form of International Prospectus
Supplement of a section under the caption "Certain United States Tax
Considerations for Non-United States Holders." The final Form of U.S. Prospectus
Supplement and the final Form of International Prospectus Supplement, including
the documents incorporated by reference therein pursuant to Item 12 of Form S-3
under the 1933 Act, and including the prospectus constituting a part of the
Registration Statement, in the forms first furnished to the Underwriters for use
in connection with the offering of the Securities are herein called the "U.S.
Prospectus" and the "International Prospectus," respectively, and collectively,
the "Prospectuses." If Rule 434 is relied on, the terms "U.S. Prospectus" and
"International Prospectus" shall refer to the preliminary U.S. Prospectus dated
February 13, 1997 and preliminary International Prospectus dated February 13,
1997, respectively, each together with the applicable Term Sheet and all
references in this Agreement to the date of such Prospectuses shall mean the
date of the applicable Term Sheet. For purposes of this Agreement, all
references to the Registration Statement, any preliminary prospectus, the
Prospectus, the Form of U.S. Prospectus Supplement, the Form of International
Prospectus Supplement or any Term Sheet or any amendment or supplement to any of
the foregoing shall be deemed to include the copy filed with the Commission
pursuant to its Electronic Data Gathering, Analysis and Retrieval system
("EDGAR").
3
<PAGE>
All references in this Agreement to financial statements and schedules and
other information which is "contained," "included," "stated," "disclosed" or
"referred to" in the Registration Statement, any preliminary prospectus
(including the Form of U.S. Prospectus Supplement and Form of International
Prospectus Supplement) or the Prospectuses (or other references of like import)
shall be deemed to mean and include all such financial statements and schedules
and other information which is incorporated by reference in the Registration
Statement, any preliminary prospectus (including the Form of U.S. Prospectus
Supplement and Form of International Prospectus Supplement) or the Prospectuses,
as the case may be; and all references in this Agreement to amendments or
supplements to the Registration Statement, any preliminary prospectus or the
Prospectuses shall be deemed to mean and include the filing of any document
under the 1934 Act which is incorporated by reference in the Registration
Statement, such preliminary prospectus or the Prospectuses, as the case may be.
SECTION 1. Representations and Warranties.
(a) Representations and Warranties by the Company. The Company represents
and warrants to each U.S. Underwriter as of the date hereof, as of the Closing
Time referred to in Section 2(c) hereof, and as of each Date of Delivery (if
any) referred to in Section 2(b), hereof and agrees with each U.S. Underwriter,
as follows:
(i) Compliance with Registration Requirements. The Company meets the
requirements for use of Form S-3 under the 1933 Act. Each of the
Registration Statement and any Rule 462(b) Registration Statement has
become effective under the 1933 Act and no stop order suspending the
effectiveness of the Registration Statement or any Rule 462(b) Registration
Statement has been issued under the 1933 Act and no proceedings for that
purpose have been instituted or are pending or, to the knowledge of the
Company, are contemplated by the Commission, and any request on the part of
the Commission for additional information has been complied with.
At the respective times the Registration Statement, any Rule 462(b)
Registration Statement and any post-effective amendments thereto became
effective and at the Closing Time (and, if any U.S. Option Securities are
purchased, at the Date of Delivery), the Registration Statement, the Rule
462(b) Registration Statement and any amendments and supplements thereto
complied and will comply in all material respects with the requirements of
the 1933 Act and the 1933 Act Regulations and did not and will not contain
an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein
not misleading. Neither of the Prospectuses nor any amendments or
supplements thereto, at the time the Prospectuses or any amendments or
supplements thereto were issued and at the Closing Time (and, if any U.S.
Option Securities are purchased, at the Date of Delivery), included or will
include an untrue statement of a material fact or omitted or will omit to
state a material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not misleading.
If Rule 434 is used, the Company will comply with the requirements of Rule
434. The representations and
4
<PAGE>
warranties in this subsection shall not apply to statements in or omissions
from the Registration Statement or the U.S. Prospectus made in reliance
upon and in conformity with information furnished to the Company in writing
by any U.S. Underwriter through the U.S. Representatives expressly for use
in the Registration Statement or the U.S. Prospectus.
Each preliminary prospectus and the prospectuses filed as part of the
Registration Statement as originally filed or as part of any amendment
thereto, or filed pursuant to Rule 424 under the 1933 Act, complied when so
filed in all material respects with the 1933 Act Regulations and each
preliminary prospectus and the Prospectuses delivered to the Underwriters
for use in connection with this offering were identical to the
electronically transmitted copies thereof filed with the Commission
pursuant to EDGAR, except to the extent permitted by Regulation S-T.
(ii) Incorporated Documents. The documents incorporated or deemed to
be incorporated by reference in the Registration Statement and the
Prospectuses, at the time they were or hereafter are filed with the
Commission, complied and will comply in all material respects with the
requirements of the 1934 Act and the rules and regulations of the
Commission thereunder (the "1934 Act Regulations"), and, when read together
with the other information in the Prospectuses, at the time the
Registration Statement became effective, at the time the Prospectuses were
issued and at the Closing Time (and, if any U.S. Option Securities are
purchased, at the Date of Delivery), did not and will not contain an untrue
statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not
misleading.
(iii) Independent Accountants. The accountants who certified the
financial statements and supporting schedules included in the Registration
Statement are independent public accountants as required by the 1933 Act
and the 1933 Act Regulations.
(iv) Financial Statements. The financial statements included in the
Registration Statement and the Prospectuses, together with the related
schedules and notes, present fairly the financial position of the Company
and its consolidated subsidiaries at the dates indicated and the statement
of operations, stockholders' equity and cash flows of the Company and its
consolidated subsidiaries 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
("GAAP") applied on a consistent basis throughout the periods involved. The
supporting schedules, if any, included in the Registration Statement
present fairly in accordance with GAAP the information required to be
stated therein. The selected financial data and the summary financial
information included in the Prospectuses present fairly the information
shown therein and have been compiled on a basis consistent with that of the
audited financial statements included in the Registration Statement.
5
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(v) No Material Adverse Change in Business. Since the respective dates
as of which information is given in the Registration Statement and the
Prospectuses, except as otherwise stated therein, (A) there has been no
material adverse change in the condition, financial or otherwise, earnings,
business affairs or business prospects of the Company and its subsidiaries
considered as one enterprise, whether or not arising in the ordinary course
of business (a "Material Adverse Effect"), (B) there have been no
transactions entered into by the Company or any of its subsidiaries, other
than those in the ordinary course of business, which are material with
respect to the Company and its subsidiaries considered as one enterprise,
and (C) except for regular quarterly dividends on the Common Stock in
amounts per share that are consistent with past practice, there has been no
dividend or distribution of any kind declared, paid or made by the Company
on any class of its capital stock.
(vi) Good Standing of the Company. The Company has been duly organized
and is validly existing as a corporation in good standing under the laws of
the Commonwealth of Massachusetts with power and authority (corporate and
other) under such laws to own, lease and operate its properties and to
conduct its business as described in the Prospectuses and to enter into and
perform its obligations under this Agreement and the International Purchase
Agreement; and the Company is duly qualified as a foreign corporation to
transact business and is in good standing in each other jurisdiction in
which such qualification is required, whether by reason of the ownership or
leasing of property or the conduct of business, except where the failure so
to qualify or to be in good standing would not result in a Material Adverse
Effect.
(vii) Good Standing of Subsidiaries. Each "significant subsidiary" of
the Company (as such term is defined in Rule 1-02 of Regulation S-X) (each
a "Significant Subsidiary" and all of the Company's subsidiaries are
collectively hereinafter referred to as the "Subsidiaries") has been duly
organized and is validly existing as a corporation under the laws of its
jurisdiction of incorporation, has corporate power and authority to own its
properties and to conduct its business as described in the Prospectuses and
is duly qualified as a foreign corporation to transact business and is in
good standing in each jurisdiction in which such qualification is required,
whether by reason of the ownership or leasing of property or the conduct of
business, except where the failure to be so qualified or in good standing
would not result in a Material Adverse Effect; except as otherwise
disclosed in the Registration Statement, all of the issued and outstanding
capital stock of each such Significant Subsidiary has been duly authorized
and validly issued, is fully paid and non-assessable and (except for
non-material liens that have arisen in the ordinary course of business and
in the case of foreign subsidiaries, for directors' qualifying shares) is
owned by the Company, directly or indirectly, free and clear of all liens,
encumbrances, security interests and claims.
(viii) Capitalization. The Company has authorized, issued and
outstanding capital stock as set forth in the Prospectuses under the
caption "Capitalization" (except for subsequent issuances, if any, pursuant
to this Agreement, pursuant to reservations, agreements or employee benefit
plans referred to in the Prospectuses or pursuant to the
6
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exercise of convertible securities or options referred to in the
Prospectuses). The shares of issued and outstanding capital stock of the
Company have been duly authorized and validly issued and are fully paid and
non-assessable; none of the outstanding shares of capital stock of the
Company was issued in violation of the preemptive or other similar rights
of any securityholder of the Company. Except as disclosed in the
Prospectuses, there are no holders of securities (debt or equity) of the
Company or any of its Subsidiaries, or holders of rights (including,
without limitation, preemptive rights), warrants or options to obtain
securities of the Company or its Subsidiaries who have the right to request
the Company or any of its Subsidiaries to register securities held by them
under the 1933 Act other than holders who have elected not to exercise
their rights. All of the Registrable Securities (other than Registrable
Securities constituting or issued or issuable upon exercise of Warrants)
under the Registration Rights Agreement, dated as of July 7, 1992 among
Kendall International Inc. (whose obligations have been assumed by the
Company) and the stockholders and other parties named therein (the "Kendall
Registration Rights Agreement") are freely tradeable under the United
States federal securities laws (including pursuant to Rule 144 of the 1933
Act Regulations, without regard to the volume limitations thereunder).
(ix) Authorization of Agreement. This Agreement and the International
Purchase Agreement have been duly authorized, executed and delivered by the
Company.
(x) Authorization and Description of Securities. The Securities to be
purchased by the U.S. Underwriters and the International Managers from the
Company have been duly authorized for issuance and sale to the U.S.
Underwriters pursuant to this Agreement and to the International Managers
pursuant to the International Purchase Agreement, respectively, and, when
issued and delivered by the Company pursuant to this Agreement and the
International Purchase Agreement, respectively, against payment of the
consideration set forth herein and in the International Purchase Agreement,
respectively, will be validly issued, fully paid and non-assessable; the
Common Stock conforms to all statements relating thereto contained in the
Prospectuses and such description conforms to the rights set forth in the
instruments defining the same; and the issuance of the Securities is not
subject to the preemptive or other similar rights of any securityholder of
the Company.
(xi) Absence of Defaults and Conflicts. Neither the Company nor any of
its Subsidiaries is in violation of its charter or by-laws or in default in
the performance or observance of any obligation, agreement, covenant or
condition contained in any contract, indenture, mortgage, deed of trust,
loan or credit agreement, note, lease or other agreement or instrument to
which the Company or any of its Subsidiaries is a party or by which it or
any of them may be bound, or to which any of the property or assets of the
Company or any subsidiary is subject (collectively, "Agreements and
Instruments") except for such defaults that would not result in a Material
Adverse Effect; and the execution, delivery and performance of this
Agreement and the International Purchase Agreement and the consummation of
the transactions contemplated in this Agreement, the International Purchase
Agreement and in the Registration Statement (including the
7
<PAGE>
issuance and sale of the Securities and the use of the proceeds from the
sale of the Securities as described in the Prospectuses under the caption
"Use of Proceeds") and compliance by the Company with its obligations under
this Agreement and the International Purchase Agreement have been duly
authorized by all necessary corporate action and do not and will not,
whether with or without the giving of notice or passage of time or both,
conflict with or constitute a breach of, or default or Repayment Event (as
defined below) under, or result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the Company or any
subsidiary pursuant to, the Agreements and Instruments (except for such
conflicts, breaches or defaults or liens, charges or encumbrances that
would not result in a Material Adverse Effect), nor will such action result
in any violation of the provisions of the charter or by-laws of the Company
or any subsidiary or any law, statute, rule, regulation, judgment, order,
writ or decree applicable to the Company or of any government, government
instrumentality or court, domestic or foreign, having jurisdiction over the
Company or any subsidiary or any of their assets, properties or operations.
As used herein, a "Repayment Event" means any event or condition which
gives the holder of any note, debenture or other evidence of indebtedness
(or any person acting on such holder's behalf) the right to require the
repurchase, redemption or repayment of all or a portion of such
indebtedness by the Company or any subsidiary.
(xii) Absence of Labor Dispute. Except as disclosed in the
Prospectuses, labor dispute with the employees of the Company or any
subsidiary exists or, to the knowledge of the Company, is imminent, which
could reasonably be expected to result in a Material Adverse Effect.
(xiii) Absence of Proceedings. Except as disclosed in the
Prospectuses, there is no action, suit, proceeding, inquiry or
investigation before or brought by any court or governmental agency or
body, domestic or foreign, now pending, or, to the knowledge of the
Company, threatened, against or affecting the Company or any Subsidiary,
which is required to be disclosed in the Registration Statement, or which
could reasonably be expected to result in a Material Adverse Effect, or
which could reasonably be expected to materially and adversely affect the
consummation of the transactions contemplated in this Agreement and the
International Purchase Agreement or the performance by the Company of its
obligations hereunder or thereunder.
(xiv) Accuracy of Exhibits. There are no contracts or documents which
are required to be described in the Registration Statement, the
Prospectuses or the documents incorporated by reference therein or to be
filed as exhibits thereto which have not been so described and filed as
required.
(xv) Absence of Further Requirements. No filing with, or
authorization, approval, consent, license, order, registration,
qualification or decree of, any court or governmental authority or agency
is necessary or required for the performance by the Company of its
obligations hereunder, in connection with the offering, issuance or sale of
the Securities under this Agreement and the International Purchase
Agreement or the
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consummation of the transactions contemplated by this Agreement and the
International Purchase Agreement, except such as have been already obtained
or as may be required under the 1933 Act or the 1933 Act Regulations and
foreign or state securities or blue sky laws.
(xvi) Compliance with Cuba Act. The Company has complied with, and is
and will be in compliance with, the provisions of that certain Florida act
relating to disclosure of doing business with Cuba, codified as Section
517.075 of the Florida statutes, and the rules and regulations thereunder
(collectively, the "Cuba Act") or is exempt therefrom.
(xvii) Investment Company Act. The Company is not, and upon the
issuance and sale of the Securities as herein contemplated and the
application of the net proceeds therefrom as described in the Prospectuses
will not be, an "investment company" or an entity "controlled" by an
"investment company" as such terms are defined in the Investment Company
Act of 1940, as amended (the "1940 Act").
(b) Officer's Certificates Officer's Certificates. Any certificate
signed by any officer of the Company or any of its Subsidiaries delivered
to the Global Coordinator, the U.S. Underwriters or to counsel for the U.S.
Underwriters shall be deemed a representation and warranty by the Company
to each U.S. Underwriter as to the matters covered thereby.
SECTION 2. Sale and Delivery to U.S. Underwriters; Closing.
(a) Initial Securities. On the basis of the representations and warranties
herein contained and subject to the terms and conditions herein set forth, the
Company agrees to sell to each U.S. Underwriter, severally and not jointly, and
each U.S. Underwriter, severally and not jointly, agrees to purchase from the
Company, at the price per share set forth in Schedule B, the number of Initial
U.S. Securities set forth in Schedule A opposite the name of such U.S.
Underwriter, plus any additional number of Initial U.S. Securities which such
Underwriter may become obligated to purchase pursuant to the provisions of
Section 10 hereof.
(b) Option Securities. In addition, on the basis of the representations and
warranties herein contained and subject to the terms and conditions herein set
forth, the Company hereby grants an option to the U.S. Underwriters, severally
and not jointly, to purchase up to an additional 1,200,000 shares of Common
Stock at the price per share set forth in Schedule B, less an amount per share
equal to any dividends or distributions declared by the Company and payable on
the Initial U.S. Securities but not payable on the U.S. Option Securities (for
purposes of this agreement, dividends declared by the Company subsequent to the
Closing Time that are payable on shares of Common Stock held as of a record date
that is subsequent to a Date of Delivery are payable on the U.S. Option
Securities). The option hereby granted will expire 30 days after the date hereof
and may be exercised in whole or in part from time to time only for the purpose
of covering over-allotments which may be made in connection with the offering
and distribution of the Initial U.S. Securities upon notice by the Global
Coordinator to the Company setting forth the number of U.S. Option Securities as
to which the several U.S. Underwriters are then exercising the option and the
time and date of payment and delivery for such U.S. Option
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Securities. Any such time and date of delivery for the U.S. Option Securities (a
"Date of Delivery") shall be determined by the Global Coordinator, but shall not
be later than seven full business days after the exercise of said option, nor in
any event prior to the Closing Time, as hereinafter defined, or later than April
3, 1997. If the option is exercised as to all or any portion of the U.S. Option
Securities, each of the U.S. Underwriters, acting severally and not jointly,
will purchase that proportion of the total number of U.S. Option Securities then
being purchased which the number of Initial U.S. Securities set forth in
Schedule A opposite the name of such U.S. Underwriter bears to the total number
of Initial U.S. Securities, subject in each case to such adjustments as the
Global Coordinator in its discretion shall make to eliminate any sales or
purchases of fractional shares.
(c) Payment. Payment of the purchase price for, and delivery of
certificates for, the Initial Securities shall be made at the offices of Fried,
Frank, Harris, Shriver & Jacobson, One New York Plaza, New York, New York 10004,
or at such other place as shall be agreed upon by the Global Coordinator and the
Company, at 9:00 A.M. (Eastern time) on the third (fourth, if the pricing occurs
after 4:30 P.M. (Eastern time) on any given day) business day after the date
hereof (unless postponed in accordance with the provisions of Section 10), or
such other time not later than ten business days after such date as shall be
agreed upon by the Global Coordinator and the Company (such time and date of
payment and delivery being herein called "Closing Time").
In addition, in the event that any or all of the U.S. Option Securities are
purchased by the U.S. Underwriters, payment of the purchase price for, and
delivery of certificates for, such U.S. Option Securities shall be made at the
above-mentioned offices, or at such other place as shall be agreed upon by the
Global Coordinator and the Company, on each Date of Delivery as specified in the
notice from the Global Coordinator to the Company, which Date of Delivery shall
not be later than April 3, 1997.
Payment shall be made to the Company by wire transfer of immediately
available funds to a bank account designated by the Company, against delivery to
the U.S. Representatives for the respective accounts of the U.S. Underwriters of
certificates for the U.S. Securities to be purchased by them. It is understood
that each U.S. Underwriter has authorized the U.S. Representatives, for its
account, to accept delivery of, receipt for, and make payment of the purchase
price for, the Initial U.S. Securities and the U.S. Option Securities, if any,
which it has agreed to purchase. Merrill Lynch, individually and not as
representative of the U.S. Underwriters, may (but shall not be obligated to)
make payment of the purchase price for the Initial U.S. Securities or the U.S.
Option Securities, if any, to be purchased by any U.S. Underwriter whose funds
have not been received by the Closing Time or the relevant Date of Delivery, as
the case may be, but such payment shall not relieve such U.S. Underwriter from
its obligations hereunder.
(d) Denominations; Registration. Certificates for the Initial U.S.
Securities and the U.S. Option Securities, if any, shall be in such
denominations and registered in such names as the U.S. Representatives may
request in writing at least one full business day before the Closing Time or the
relevant Date of Delivery, as the case may be. The certificates for the Initial
U.S. Securities and the U.S. Option Securities, if any, will be made available
for examination and
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packaging by the U.S. Representatives in The City of New York not later than
10:00 A.M. (Eastern time) on the business day prior to the Closing Time or the
relevant Date of Delivery, as the case may be.
SECTION 3. Covenants of the Company. The Company covenants with each U.S.
Underwriter as follows:
(a) Compliance with Securities Regulations and Commission Requests.
The Company, subject to Section 3(b), will comply with the requirements of
Rule 430A or Rule 434, as applicable, and will notify the Global
Coordinator immediately, and confirm the notice in writing, (i) when any
post-effective amendment to the Registration Statement shall become
effective, or any supplement to the Prospectuses or any amended
Prospectuses shall have been filed, (ii) of the receipt of any comments
from the Commission, (iii) of any request by the Commission for any
amendment to the Registration Statement or any amendment or supplement to
the Prospectuses or for additional information, and (iv) of the issuance by
the Commission of any stop order suspending the effectiveness of the
Registration Statement or of any order preventing or suspending the use of
any preliminary prospectus, or of the suspension of the qualification of
the Securities for offering or sale in any jurisdiction, or of the
initiation or threatening of any proceedings for any of such purposes. The
Company will promptly effect the filings necessary pursuant to Rule 424(b)
and will take such steps as it deems necessary to ascertain promptly
whether the form of prospectus transmitted for filing under Rule 424(b) was
received for filing by the Commission and, in the event that it was not, it
will promptly file such prospectus. The Company will make every reasonable
effort to prevent the issuance of any stop order and, if any stop order is
issued, to obtain the lifting thereof at the earliest possible moment.
(b) Filing of Amendments. The Company will give the Global Coordinator
notice of its intention to file or prepare any amendment to the
Registration Statement (including any filing under Rule 462(b)), any Term
Sheet or any amendment, supplement or revision to either the prospectus
included in the Registration Statement at the time it became effective or
to the Prospectuses, whether pursuant to the 1933 Act, the 1934 Act or
otherwise, will furnish the Global Coordinator with copies of any such
documents a reasonable amount of time prior to such proposed filing or use,
as the case may be, and will not file or use any such document to which the
Global Coordinator or counsel for the U.S. Underwriters reasonably and
timely shall object in writing.
(c) Delivery of Registration Statements. The Company has furnished or
will deliver to the U.S. Representatives and counsel for the U.S.
Underwriters, without charge, signed copies of the Registration Statement
as originally filed and of each amendment thereto (including exhibits filed
therewith or incorporated by reference therein and documents incorporated
or deemed to be incorporated by reference therein) and signed copies of all
consents and certificates of experts. The copies of the Registration
Statement and each amendment thereto furnished to the U.S. Underwriters
will be
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identical to the electronically transmitted copies thereof filed with the
Commission pursuant to EDGAR, except to the extent permitted by Regulation
S-T.
(d) Delivery of Prospectuses. The Company has delivered to each U.S.
Underwriter, without charge, as many copies of each preliminary prospectus
as such U.S. Underwriter reasonably requested, and the Company hereby
consents to the use of such copies for purposes permitted by the 1933 Act.
The Company will furnish to each U.S. Underwriter, without charge, during
the period when the U.S. Prospectus is required to be delivered under the
1933 Act or the 1934 Act, such number of copies of the U.S. Prospectus (as
amended or supplemented) as such U.S. Underwriter may reasonably request.
The U.S. Prospectus and any amendments or supplements thereto furnished to
the U.S. Underwriters will be identical to the electronically transmitted
copies thereof filed with the Commission pursuant to EDGAR, except to the
extent permitted by Regulation S-T.
(e) Continued Compliance with Securities Laws. The Company will comply
with the 1933 Act and the 1933 Act Regulations and the 1934 Act and the
1934 Act Regulations so as to permit the completion of the distribution of
the Securities as contemplated in this Agreement, the International
Purchase Agreement and in the Prospectuses. If at any time when a
prospectus is required by the 1933 Act to be delivered in connection with
sales of the Securities, any event shall occur or condition shall exist as
a result of which it is necessary, in the opinion of counsel for the U.S.
Underwriters or for the Company, to amend the Registration Statement or
amend or supplement any Prospectus in order that the Prospectuses will not
include any untrue statements of a material fact or omit to state a
material fact necessary in order to make the statements therein not
misleading in the light of the circumstances existing at the time it is
delivered to a purchaser, or if it shall be necessary, in the opinion of
such counsel, at any such time to amend the Registration Statement or amend
or supplement any Prospectus in order to comply with the requirements of
the 1933 Act or the 1933 Act Regulations, the Company will promptly prepare
and file with the Commission, subject to Section 3(b), such amendment or
supplement as may be necessary to correct such statement or omission or to
make the Registration Statement or the Prospectuses comply with such
requirements, and the Company will furnish to the U.S. Underwriters such
number of copies of such amendment or supplement as the U.S. Underwriters
may reasonably request.
(f) Blue Sky Qualifications. The Company will endeavor, in cooperation
with the U.S. Underwriters, to qualify the Securities for offering and sale
under the applicable securities laws of such states and other jurisdictions
(domestic or foreign) as the Global Coordinator may designate and to
maintain such qualifications in effect for a period of not less than one
year from the later of the effective date of the Registration Statement and
any Rule 462(b) Registration Statement; provided, however, that the Company
shall not be obligated to file any general consent to service of process or
to qualify as a foreign corporation or as a dealer in securities in any
jurisdiction in which it is not so qualified or to subject itself to
taxation in respect of doing business in any jurisdiction in which it is
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not otherwise so subject. In each jurisdiction in which the Securities have
been so qualified, the Company will file such statements and reports as may
be required by the laws of such jurisdiction to continue such qualification
in effect for a period of not less than one year from the effective date of
the Registration Statement and any Rule 462(b) Registration Statement.
(g) Rule 158. The Company will timely file such reports pursuant to
the 1934 Act as are necessary in order to make generally available to its
securityholders as soon as practicable an earnings statement for the
purposes of, and to provide the benefits contemplated by, the last
paragraph of Section 11(a) of the 1933 Act.
(h) Use of Proceeds. The Company will use the net proceeds received by
it from the sale of the Securities in the manner specified in the
Prospectuses under "Use of Proceeds."
(i) Listing. The Company will use its best efforts to effect the
listing of the Securities on the New York Stock Exchange.
(j) Restriction on Sale of Securities. During a period of 60 days from
the date of the Prospectuses, the Company will not, without the prior
written consent of the Global Coordinator, (i) directly or indirectly,
offer, pledge, sell, contract to sell, sell any option or contract to
purchase, purchase any option or contract to sell, grant any option, right
or warrant to purchase or otherwise transfer or dispose of any shares of
Common Stock or any securities convertible into or exercisable or
exchangeable for Common Stock or file any registration statement under the
1933 Act with respect to any of the foregoing or (ii) enter into any swap
or any other agreement or any transaction that transfers, in whole or in
part, directly or indirectly, the economic consequence of ownership of the
Common Stock, whether any such swap or transaction described in clause (i)
or (ii) above is to be settled by delivery of Common Stock or such other
securities, in cash or otherwise. The foregoing sentence shall not apply to
(A) the Securities to be sold hereunder or under the International Purchase
Agreement, (B) any shares of Common Stock issued by the Company upon the
exercise of an option or warrant or the conversion of a security
outstanding on the date hereof and referred to in the Prospectuses, (C) any
shares of Common Stock issued or options to purchase Common Stock granted
pursuant to employee benefit plans of the Company pursuant to the terms
thereof as in effect on the date hereof and (D) the filing of a
registration statement under the 1933 Act for the registration of warrants,
or shares of Common Stock issued or issuable upon exercise of such
warrants, pursuant to the Kendall Registration Rights Agreement (estimated
to be up to 130,600 shares).
(k) Reporting Requirements. The Company, during the period when the
Prospectuses are required to be delivered under the 1933 Act or the 1934
Act, will file all documents required to be filed with the Commission
pursuant to the 1934 Act within the time periods required by the 1934 Act
and the 1934 Act Regulations.
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SECTION 4. Payment of Expenses.
(a) Expenses. The Company agrees to pay all expenses incident to the
performance of its obligations under this Agreement, including (i) the
preparation, printing and filing of the Registration Statement (including
financial statements and exhibits) as originally filed and of each amendment
thereto, (ii) the preparation, printing and delivery to the Underwriters of this
Agreement, any Agreement among Underwriters, any Intersyndicate Agreement and
such other documents as may be required in connection with the offering,
purchase, sale, issuance or delivery of the Securities, (iii) the preparation,
issuance and delivery of the certificates for the Securities to the
Underwriters, including any stock or other transfer taxes and any stamp or other
duties payable upon the sale, issuance or delivery of the Securities to the
Underwriters and the transfer of the Securities between the U.S. Underwriters
and the International Managers, (iv) the fees and disbursements of the Company's
counsel, accountants and other advisors, (v) the qualification of the Securities
under securities laws in accordance with the provisions of Section 3(f) hereof,
including filing fees and the reasonable fees and disbursements of counsel for
the Underwriters in connection therewith and in connection with the preparation
of the Blue Sky Survey and any supplement thereto, (vi) the printing and
delivery to the Underwriters of copies of each preliminary prospectus, any Term
Sheets and of the Prospectuses and any amendments or supplements thereto, (vii)
the preparation, printing and delivery to the Underwriters of copies of the Blue
Sky Survey and any supplement thereto, (viii) the fees and expenses of any
transfer agent or registrar for the Securities and (ix) the fees and expenses
incurred in connection with the listing of the Securities on the New York Stock
Exchange.
(b) Termination of Agreement. If this Agreement is terminated by the U.S.
Representatives in accordance with the provisions of Section 5 or Section
9(a)(i) hereof, the Company shall reimburse the U.S. Underwriters for all of
their out-of-pocket expenses, including the reasonable fees and disbursements of
Fried, Frank, Harris, Shriver & Jacobson as counsel for the U.S. Underwriters.
SECTION 5. Conditions of U.S. Underwriters' Obligations. The obligations of
the several U.S. Underwriters hereunder are subject to the accuracy of the
representations and warranties of the Company contained in Section 1 hereof or
in certificates of any officer of the Company or any subsidiary of the Company
delivered pursuant to the provisions hereof, to the performance by the Company
of its covenants and other obligations hereunder, and to the following further
conditions:
(a) Effectiveness of Registration Statement. The Registration
Statement, including any Rule 462(b) Registration Statement, has become
effective and at Closing Time no stop order suspending the effectiveness of
the Registration Statement shall have been issued under the 1933 Act or
proceedings therefor initiated or threatened by the Commission, and any
request on the part of the Commission for additional information shall have
been complied with to the reasonable satisfaction of counsel to the U.S.
Underwriters. A prospectus containing the Rule 430A Information shall have
been filed with the Commission in accordance with Rule 424(b) (or a
post-effective amendment providing such information shall have been filed
and declared effective in accordance
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with the requirements of Rule 430A) or, if the Company has elected to rely
upon Rule 434, a Term Sheet shall have been filed with the Commission in
accordance with Rule 424(b).
(b) Opinion of General Counsel of Company. At Closing Time, the U.S.
Representatives shall have received the favorable opinion, dated as of
Closing Time, of M. Brian Moroze, Esq., General Counsel of the Company, in
form and substance satisfactory to counsel for the U.S. Underwriters, to
the effect set forth in Exhibit A-1 hereto and to such further effect as
counsel to the U.S. Underwriters may reasonably request.
(c) Opinion of Counsel for Company. At Closing Time, the U.S.
Representatives shall have received the favorable opinion, dated as of
Closing Time, of Kramer, Levin, Naftalis & Frankel, counsel for the
Company, in form and substance satisfactory to counsel for the U.S.
Underwriters, to the effect set forth in Exhibit A-2 hereto and to such
further effect as counsel to the U.S. Underwriters may reasonably request.
In giving such opinion, such counsel may rely on the opinion of the
Company's General Counsel as to all matters governed by the law of the
Commonwealth of Massachusetts.
(d) Opinion of Counsel for U.S. Underwriters. At Closing Time, the
U.S. Representatives shall have received the favorable opinion, dated as of
Closing Time, of Fried, Frank, Harris, Shriver & Jacobson, counsel for the
U.S. Underwriters, together with signed or reproduced copies of such letter
for each of the other U.S. Underwriters with respect to the matters set
forth in clauses (i), (ii), (v), (vi) (solely as to preemptive or other
similar rights arising by operation of law or under the charter or by-laws
of the Company), (viii), (x), (xii) (solely as to the information in the
Prospectus under "Description of Capital Stock--Common Stock") and the
penultimate paragraph of Exhibit A-1 hereto and in clauses (i) and (ii) of
Exhibit A-2 hereto. In giving such opinion such counsel may rely, as to all
matters governed by the laws of jurisdictions other than the law of the
State of New York, the federal law of the United States and the General
Corporation Law of the State of Delaware, upon the opinions of counsel
satisfactory to the U.S. Underwriters. Such counsel may also state that,
insofar as such opinion involves factual matters, they have relied, to the
extent they deem proper, upon certificates of officers of the Company and
its subsidiaries and certificates of public officials.
(e) Officers' Certificate. At Closing Time, there shall not have been,
since the date hereof or since the respective dates as of which information
is given in the Prospectuses, any material adverse change in the condition,
financial or otherwise, earnings, business affairs or business prospects of
the Company and its subsidiaries considered as one enterprise, whether or
not arising in the ordinary course of business, and the U.S.
Representatives shall have received a certificate of the President or a
Vice President of the Company and of the chief financial or chief
accounting officer of the Company, dated as of Closing Time, to the effect
that (i) there has been no such material
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adverse change, (ii) the representations and warranties in Section 1(a)
hereof are true and correct with the same force and effect as though
expressly made at and as of Closing Time, (iii) the Company has complied
with all agreements and satisfied all conditions on its part to be
performed or satisfied at or prior to Closing Time, and (iv) no stop order
suspending the effectiveness of the Registration Statement has been issued
and no proceedings for that purpose have been instituted or are pending or
are contemplated by the Commission.
(f) Accountant's Comfort Letter. At the time of the execution of this
Agreement, the U.S. Representatives shall have received from Coopers &
Lybrand L.L.P. a letter dated such date, in form and substance satisfactory
to the U.S. Representatives, together with signed or reproduced copies of
such letter for each of the other U.S. Underwriters containing statements
and information of the type ordinarily included in accountants' "comfort
letters" to underwriters with respect to the financial statements and
certain financial information contained in the Registration Statement and
the Prospectuses.
(g) Bring-down Comfort Letter. At Closing Time, the U.S.
Representatives shall have received from Coopers & Lybrand L.L.P. a letter,
dated as of Closing Time, to the effect that they reaffirm the statements
made in the letter furnished pursuant to subsection (f) of this Section,
except that the specified date referred to shall be a date not more than
three business days prior to Closing Time.
(h) Approval of Listing. At Closing Time, the Securities shall have
been approved for listing on the New York Stock Exchange, subject only to
official notice of issuance.
(i) Lock up Agreements. At the date of this Agreement, the U.S.
Representatives shall have received an agreement substantially in the form
of Exhibit B hereto signed by the persons listed on Schedule C hereto.
(j) Indemnification Agreement. The Company shall have executed the
indemnification agreement with the Underwriters dated as of even date
herewith and such agreement shall be in full force and effect and represent
a binding and enforceable agreement of the Company.
(k) Certificate of Chief Financial Officer. At the Closing Time, you
shall have received a certificate of the Chief Financial Officer of the
Company as to certain agreed upon accounting matters.
(l) Purchase of Initial International Securities. Contemporaneously
with the purchase by the U.S. Underwriters of the Initial U.S. Securities
under this Agreement, the International Managers shall have purchased the
Initial International Securities under the International Purchase
Agreement.
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(m) Conditions to Purchase of U.S. Option Securities. In the event
that the U.S. Underwriters exercise their option provided in Section 2(b)
hereof to purchase all or any portion of the U.S. Option Securities, the
representations and warranties of the Company contained herein and the
statements in any certificates furnished by the Company or any subsidiary
of the Company hereunder shall be true and correct as of each Date of
Delivery and, at the relevant Date of Delivery, the U.S. Representatives
shall have received:
(i) Officers' Certificate. A certificate, dated such Date of
Delivery, of the President or a Vice President of the Company and of
the chief financial or chief accounting officer of the Company
confirming that the certificate delivered at the Closing Time pursuant
to Section 5(e) hereof remains true and correct as of such Date of
Delivery.
(ii) Opinion of General Counsel of Company. The favorable opinion
of M. Brian Moroze, Esq., General Counsel of the Company, in form and
substance satisfactory to counsel for the U.S. Underwriters, dated
such Date of Delivery, relating to the U.S. Option Securities to be
purchased on such Date of Delivery and otherwise to the same effect as
the opinion required by Section 5(b) hereof.
(iii) Opinion of Counsel for Company. The favorable opinion of
Kramer, Levin, Naftalis & Frankel, counsel for the Company, in form
and substance satisfactory to counsel for the U.S. Underwriters, dated
such Date of Delivery, relating to the U.S. Option Securities to be
purchased on such Date of Delivery and otherwise to the same effect as
the opinion required by Section 5(c) hereof.
(iv) Opinion of Counsel for U.S. Underwriters. The favorable
opinion of Fried, Frank, Harris, Shriver & Jacobson, counsel for the
U.S. Underwriters, dated such Date of Delivery, relating to the U.S.
Option Securities to be purchased on such Date of Delivery and
otherwise to the same effect as the opinion required by Section 5(d)
hereof.
(v) Bring-down Comfort Letter. A letter from Coopers & Lybrand
L.L.P., in form and substance satisfactory to the U.S. Representatives
and dated such Date of Delivery, substantially in the same form and
substance as the letter furnished to the U.S. Representatives pursuant
to Section 5(g) hereof, except that the "specified date" in the letter
furnished pursuant to this paragraph shall be a date not more than
five days prior to such Date of Delivery.
(n) Additional Documents. At Closing Time and at each Date of
Delivery, counsel for the U.S. Underwriters shall have been furnished with
such documents and opinions as they may reasonably require for the purpose
of enabling them to pass upon the issuance and sale of the Securities as
herein contemplated, or in order to evidence the accuracy of any of the
representations or warranties, or the fulfillment of any of the conditions,
herein contained; and all proceedings taken by the Company in connection
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with the issuance and sale of the Securities as herein contemplated shall
be satisfactory in form and substance to the U.S. Representatives and
counsel for the U.S. Underwriters.
(o) Termination of Agreement. If any condition specified in this
Section shall not have been fulfilled when and as required to be fulfilled,
this Agreement, or, in the case of any condition to the purchase of U.S.
Option Securities on a Date of Delivery which is after the Closing Time,
the obligations of the several U.S. Underwriters to purchase the relevant
Option Securities, may be terminated by the U.S. Representatives by notice
to the Company at any time at or prior to Closing Time or such Date of
Delivery, as the case may be, and such termination shall be without
liability of any party to any other party except as provided in Section 4
and except that Sections 1, 6, 7 and 8 shall survive any such termination
and remain in full force and effect.
SECTION 6. Indemnification.
(a) Indemnification of U.S. Underwriters. The Company agrees to indemnify
and hold harmless each U.S. Underwriter and each person, if any, who controls
any U.S. Underwriter within the meaning of Section 15 of the 1933 Act or Section
20 of the 1934 Act as follows:
(i) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, arising out of any untrue statement or alleged
untrue statement of a material fact contained in the Registration Statement
(or any amendment thereto), including the Rule 430A Information and the
Rule 434 Information, if applicable, or the omission or alleged omission
therefrom of a material fact required to be stated therein or necessary to
make the statements therein not misleading or arising out of any untrue
statement or alleged untrue statement of a material fact included in any
preliminary prospectus or the Prospectuses (or any amendment or supplement
thereto), or the omission or alleged omission therefrom of a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading;
(ii) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, to the extent of the aggregate amount paid in
settlement of any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or of any claim
whatsoever based upon any such untrue statement or omission, or any such
alleged untrue statement or omission; provided that (subject to Section
6(d) below) any such settlement is effected with the written consent of the
Company; and
(iii) against any and all expense whatsoever, as incurred (including
the fees and disbursements of counsel chosen by Merrill Lynch), reasonably
incurred in investigating, preparing or defending against any litigation,
or any investigation or proceeding by any governmental agency or body,
commenced or threatened, or any claim whatsoever based upon any such untrue
statement or omission, or any such alleged untrue statement or omission, to
the extent that any such expense is not paid under (i) or (ii) above;
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provided, however, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Company by any
U.S. Underwriter through the U.S. Representatives expressly for use in the
Registration Statement (or any amendment thereto), including the Rule 430A
Information and the Rule 434 Information, if applicable, or any preliminary
prospectus or the U.S. Prospectus (or any amendment or supplement thereto);
provided, further, that the Company will not be liable to any U.S. Underwriter
or any person controlling such U.S. Underwriter with respect to any such untrue
statement or alleged untrue statement or omission or alleged omission made in
any preliminary prospectus to the extent that the Company shall sustain the
burden of proving that any such loss, liability, claim, damage or expense
resulted from the fact that such U.S. Underwriter, in contravention of a
requirement of this Agreement or applicable law, sold securities to a person to
whom such U.S. Underwriter failed to send or give, at or prior to the written
confirmation of the sale of such Securities, a copy of the U.S. Prospectus (as
amended or supplemented) if (i) the Company has previously furnished copies
thereof (sufficiently in advance of the Closing Date to allow for distribution
of the U.S. Prospectus in a timely manner) to the U.S. Underwriter and the loss,
liability, claim, damage or expense of such U.S. Underwriter resulted from an
untrue statement or omission or alleged untrue statement or omission of a
material fact contained in or omitted from such preliminary prospectus which was
corrected in the U.S. Prospectus and (ii) such failure to give or send such U.S.
Prospectus by the Closing Date to the party or parties asserting such loss,
liability, claim or damage or expense would have constituted the sole defense to
the claim asserted by such person.
(b) Indemnification of Company, Directors and Officers. Each U.S.
Underwriter severally agrees to indemnify and hold harmless the Company, its
directors, each of its officers who signed the Registration Statement, and each
person, if any, who controls the Company within the meaning of Section 15 of the
1933 Act or Section 20 of the 1934 Act against any and all loss, liability,
claim, damage and expense described in the indemnity contained in subsection (a)
of this Section, as incurred, but only with respect to untrue statements or
omissions, or alleged untrue statements or omissions, made in the Registration
Statement (or any amendment thereto), including the Rule 430A Information and
the Rule 434 Information, if applicable, or any preliminary U.S. prospectus or
the U.S. Prospectus (or any amendment or supplement thereto) in reliance upon
and in conformity with written information furnished to the Company by such U.S.
Underwriter through the U.S. Representatives expressly for use in the
Registration Statement (or any amendment thereto) or such preliminary prospectus
or the U.S. Prospectus (or any amendment or supplement thereto).
(c) Actions against Parties; Notification. Each indemnified party shall
give notice as promptly as reasonably practicable to each indemnifying party of
any action commenced against it in respect of which indemnity may be sought
hereunder, but failure to so notify an indemnifying party shall not relieve such
indemnifying party from any liability hereunder to the extent it is not
materially prejudiced as a result thereof and in any event shall not relieve it
from any liability which it may have otherwise than on account of this indemnity
agreement. In the case of parties indemnified pursuant to Section 6(a) above,
counsel to the indemnified parties shall be selected by Merrill Lynch, and, in
the case of parties indemnified pursuant to Section
19
<PAGE>
6(b) above, counsel to the indemnified parties shall be selected by the Company.
An indemnifying party may participate at its own expense in the defense of any
such action; provided, however, that counsel to the indemnifying party shall not
(except with the consent of the indemnified party) also be counsel to the
indemnified party. In no event shall the indemnifying parties be liable for fees
and expenses of more than one counsel (in addition to any local counsel)
separate from their own counsel for all indemnified parties in connection with
any one action or separate but similar or related actions in the same
jurisdiction arising out of the same general allegations or circumstances. No
indemnifying party shall, without the prior written consent of the indemnified
parties, settle or compromise or consent to the entry of any judgment with
respect to any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim whatsoever in
respect of which indemnification or contribution could be sought under this
Section 6 or Section 7 hereof (whether or not the indemnified parties are actual
or potential parties thereto), unless such settlement, compromise or consent (i)
includes an unconditional release of each indemnified party from all liability
arising out of such litigation, investigation, proceeding or claim and (ii) does
not include a statement as to or an admission of fault, culpability or a failure
to act by or on behalf of any indemnified party.
(d) Settlement without Consent if Failure to Reimburse. If at any time an
indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel, such indemnifying party
agrees that it shall be liable for any settlement of the nature contemplated by
Section 6(a)(ii) effected without its written consent if (i) such settlement is
entered into more than 65 days after receipt by such indemnifying party of the
aforesaid request, (ii) such indemnifying party shall have received notice of
the terms of such settlement at least 45 days prior to such settlement being
entered into and (iii) such indemnifying party shall not have reimbursed such
indemnified party in accordance with such request prior to the date of such
settlement. Notwithstanding the immediately preceding sentence, if at any time
an indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel, an indemnifying party shall
not be liable for any settlement of the nature contemplated by Section 6(a)(ii)
or 6(b)(ii) effected without its consent if such indemnifying party (i)
reimburses such indemnified party in accordance with such request to the extent
it considers such request to be reasonable and (ii) provides written notice to
the indemnified party setting forth in reasonable detail its basis for disputing
the unpaid balance, in each case prior to the date of such settlement.
SECTION 7. Contribution. If the indemnification provided for in Section 6
hereof is for any reason unavailable to or insufficient to hold harmless an
indemnified party in respect of any losses, liabilities, claims, damages or
expenses referred to therein, then each indemnifying party shall contribute to
the aggregate amount of such losses, liabilities, claims, damages and expenses
incurred by such indemnified party, as incurred, (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company on the one
hand and the U.S. Underwriters on the other hand from the offering of the
Securities pursuant to this Agreement or (ii) if the allocation provided by
clause (i) is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause (i)
above but also the relative fault of the Company on the one hand and of the U.S.
Underwriters on the other hand in connection with the
20
<PAGE>
statements or omissions which resulted in such losses, liabilities, claims,
damages or expenses, as well as any other relevant equitable considerations.
The relative benefits received by the Company on the one hand and the U.S.
Underwriters on the other hand in connection with the offering of the U.S.
Securities pursuant to this Agreement shall be deemed to be in the same
respective proportions as the total net proceeds from the offering of the U.S.
Securities pursuant to this Agreement (before deducting expenses) received by
the Company and the total underwriting discount received by the U.S.
Underwriters, in each case as set forth on the cover of the U.S. Prospectus, or,
if Rule 434 is used, the corresponding location on the Term Sheet, bear to the
aggregate initial public offering price of the U.S. Securities as set forth on
such cover.
The relative fault of the Company on the one hand and the U.S. Underwriters
on the other hand shall be determined by reference to, among other things,
whether any such untrue or alleged untrue statement of a material fact or
omission or alleged omission to state a material fact relates to information
supplied by the Company or by the U.S. Underwriters and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission.
The Company and the U.S. Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 7 were determined by pro rata
allocation (even if the U.S. Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take account of the
equitable considerations referred to above in this Section 7. The aggregate
amount of losses, liabilities, claims, damages and expenses incurred by an
indemnified party and referred to above in this Section 7 shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified
party in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue or alleged untrue
statement or omission or alleged omission.
Notwithstanding the provisions of this Section 7, no U.S. 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
U.S. Underwriter has otherwise been required to pay by reason of any such untrue
or alleged untrue statement or omission or alleged omission.
No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the 1933 Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 7, each person, if any, who controls a U.S.
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act shall have the same rights to contribution as such U.S.
Underwriter, and each director of the Company, each officer of the Company who
signed the Registration Statement, and each person, if any, who controls the
Company within the meaning of Section 15 of the 1933 Act or Section 20 of the
21
<PAGE>
1934 Act shall have the same rights to contribution as the Company. The U.S.
Underwriters' respective obligations to contribute pursuant to this Section 7
are several in proportion to the number of Initial U.S. Securities set forth
opposite their respective names in Schedule A hereto and not joint.
SECTION 8. Representations, Warranties and Agreements to Survive Delivery.
All representations, warranties and agreements contained in this Agreement or in
certificates of officers of the Company or any of its subsidiaries submitted
pursuant hereto, shall remain operative and in full force and effect, regardless
of any investigation made by or on behalf of any U.S. Underwriter or controlling
person, or by or on behalf of the Company, and shall survive delivery of the
Securities to the U.S. Underwriters.
SECTION 9. Termination of Agreement.
(a) Termination; General. The U.S. Representatives may terminate this
Agreement, by notice to the Company, at any time at or prior to Closing Time (i)
if there has been, since the time of execution of this Agreement or since the
respective dates as of which information is given in the U.S. Prospectus, any
material adverse change in the condition, financial or otherwise, earnings,
business affairs or business prospects of the Company and its subsidiaries
considered as one enterprise, whether or not arising in the ordinary course of
business, or (ii) if there has occurred any material adverse change in the
financial markets in the United States or the international financial markets,
any outbreak of hostilities or escalation thereof or other calamity or crisis or
any change or development involving a prospective change in national or
international political, financial or economic conditions, in each case the
effect of which is such as to make it, in the judgment of the U.S.
Representatives, impracticable to market the Securities or to enforce contracts
for the sale of the Securities, or (iii) if trading in any securities of the
Company has been suspended or materially limited by the Commission or the New
York Stock Exchange, or if trading generally on the American Stock Exchange or
the New York Stock Exchange or in the Nasdaq National Market has been suspended
or materially limited, or minimum or maximum prices for trading have been fixed,
or maximum ranges for prices have been required, by any of said exchanges or by
such system or by order of the Commission, the National Association of
Securities Dealers, Inc. or any other governmental authority, or (iv) if a
banking moratorium has been declared by either Federal or New York authorities.
(b) Liabilities. If this Agreement is terminated pursuant to this Section,
such termination shall be without liability of any party to any other party
except as provided in Section 4 hereof, and provided further that Sections 1, 6,
7 and 8 shall survive such termination and remain in full force and effect.
SECTION 10. Default by One or More of the U.S. Underwriters. If one or more
of the U.S. Underwriters shall fail at Closing Time or a Date of Delivery to
purchase the Securities which it or they are obligated to purchase under this
Agreement (the "Defaulted Securities"), the U.S. Representatives shall have the
right, but not the obligation, within 24 hours thereafter, to make arrangements
for one or more of the non-defaulting U.S. Underwriters, or any other
underwriters, to purchase all, but not less than all, of the Defaulted
Securities in such amounts as
22
<PAGE>
may be agreed upon and upon the terms herein set forth; if, however, the U.S.
Representatives shall not have completed such arrangements within such 24-hour
period, then this Agreement shall terminate without liability on the part of any
non-defaulting U.S. Representative.
No action taken pursuant to this Section shall relieve any defaulting U.S.
Underwriter from liability in respect of its default.
In the event of any such default which does not result in a termination of
this Agreement either the U.S. Representatives or the Company shall have the
right to postpone the Closing Time or a Date of Delivery for a period not
exceeding seven days in order to effect any required changes in the Registration
Statement or the Prospectuses or in any other documents or arrangements.
SECTION 11. Notices. All notices and other communications hereunder shall
be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the U.S.
Underwriters shall be directed to the U.S. Representatives at North Tower, World
Financial Center, New York, New York 10281-1201, attention of Wood Steinberg,
Esq.; and notices to the Company shall be directed to it at One Tyco Park,
Exeter, New Hampshire 03833, attention of M. Brian Moroze, Esq.
SECTION 12. Parties. This Agreement shall each inure to the benefit of and
be binding upon the U.S. Underwriters and the Company and their respective
successors. Nothing expressed or mentioned in this Agreement is intended or
shall be construed to give any person, firm or corporation, other than the U.S.
Underwriters and the Company and their respective successors and the controlling
persons and officers and directors referred to in Sections 6 and 7 and their
heirs and legal representatives, any legal or equitable right, remedy or claim
under or in respect of this Agreement or any provision herein contained. This
Agreement and all conditions and provisions hereof are intended to be for the
sole and exclusive benefit of the U.S. Underwriters and the Company and their
respective successors, and said controlling persons and officers and directors
and their heirs and legal representatives, and for the benefit of no other
person, firm or corporation. No purchaser of Securities from any U.S.
Underwriter shall be deemed to be a successor by reason merely of such purchase.
SECTION 13. GOVERNING LAW AND TIME. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. SPECIFIED TIMES
OF DAY REFER TO NEW YORK CITY TIME.
SECTION 14. Effect of Headings. The Article and Section headings herein and
the Table of Contents are for convenience only and shall not affect the
construction hereof.
23
<PAGE>
If the foregoing is in accordance with your understanding of our agreement,
please sign and return to the Company a counterpart hereof, whereupon this
instrument, along with all counterparts, will become a binding agreement between
the U.S. Underwriters and the Company in accordance with its terms.
Very truly yours,
TYCO INTERNATIONAL LTD.
` By _________________________________
Name:
Title:
CONFIRMED AND ACCEPTED,
as of the date first above written:
MERRILL LYNCH & CO.
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
CREDIT SUISSE FIRST BOSTON CORPORATION
LEHMAN BROTHERS INC.
J.P. MORGAN SECURITIES INC.
By: MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
By /s/ [ILLEGIBLE]
----------------------------------------
Authorized Signatory
For themselves and as U.S. Representatives of the
other U.S. Underwriters named in Schedule A hereto.
24
<PAGE>
If the foregoing is in accordance with your understanding of our agreement,
please sign and return to the Company a counterpart hereof, whereupon this
instrument, along with all counterparts, will become a binding agreement between
the U.S. Underwriters and the Company in accordance with its terms.
Very truly yours,
TYCO INTERNATIONAL LTD.
By /s/ Barbara S. Miller
---------------------------------
Name:
Title:
CONFIRMED AND ACCEPTED,
as of the date first above written:
MERRILL LYNCH & CO.
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
CREDIT SUISSE FIRST BOSTON CORPORATION
LEHMAN BROTHERS INC.
J.P. MORGAN SECURITIES INC.
By: MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
By
________________________________________
Authorized Signatory
For themselves and as U.S. Representatives of the
other U.S. Underwriters named in Schedule A hereto.
<PAGE>
SCHEDULE A
Name of U.S. Underwriter Number of
------------------------ Initial U.S.
Securities
-----------
Merrill Lynch, Pierce, Fenner & Smith
Incorporated........................................... 2,000,000
Credit Suisse First Boston Corporation............................. 2,000,000
Lehman Brothers Inc................................................ 2,000,000
J.P. Morgan Securities Inc......................................... 2,000,000
Total.............................................................. 8,000,000
=========
<PAGE>
SCHEDULE B
TYCO INTERNATIONAL LTD.
8,000,000 Shares of Common Stock
(Par Value $.50 Per Share)
1. The initial public offering price per share for the Securities,
determined as provided in said Section 2, shall be $57.75.
2. The purchase price per share for the U.S. Securities to be paid by the
several U.S. Underwriters shall be $56.13, being an amount equal to the initial
public offering price set forth above less $1.62 per share; provided that the
purchase price per share for any U.S. Option Securities purchased upon the
exercise of the over-allotment option described in Section 2(b) shall be reduced
by an amount per share equal to any dividends or distributions declared by the
Company and payable on the Initial U.S. Securities but not payable on the U.S.
Option Securities (for purposes of this agreement, dividends declared by the
Company subsequent to the Closing Time that are payable on shares of Common
Stock held as of a record date that is subsequent to a Date of Delivery are
payable on the U.S. Option Securities).
<PAGE>
SCHEDULE C
LIST OF PERSONS AND ENTITIES SUBJECT TO LOCK-UP
L. Dennis Kozlowski
Jerry R. Boggess
David P. Brownell
Neil R. Garvey
John J. Guarnieri
Irving Gutin
J. Brad McGee
Robert P. Mead
Richard J. Meelia
Barbara S. Miller
Mark H. Swartz
<PAGE>
Exhibit A-1
FORM OF OPINION OF COMPANY'S GENERAL COUNSEL
TO BE DELIVERED PURSUANT TO
SECTION 5(b)
(i) The Company is a corporation validly organized and validly existing and
in good standing under the laws of the Commonwealth of Massachusetts.
(ii) The Company has the requisite power and authority (corporate and
other) to own, lease and operate its properties and to conduct its business as
described in the Prospectuses and to enter into and perform its obligations
under the U.S. Purchase Agreement and the International Purchase Agreement.
(iii) The Company is duly qualified as a foreign corporation to transact
business and is in good standing in each jurisdiction in which such
qualification is required, whether by reason of the ownership or leasing of
property or the conduct of business, except where the failure to be so qualified
or in good standing would not result in a Material Adverse Effect.
(iv) The authorized, issued and outstanding capital stock of the Company is
as set forth in the Prospectuses under the caption "Capitalization" (except for
subsequent issuances, if any, pursuant to the U.S. Purchase Agreement and the
International Purchase Agreement or pursuant to reservations, agreements or
employee benefit plans referred to in the Prospectuses or pursuant to the
exercise of convertible securities or options referred to in the Prospectuses);
the shares of issued and outstanding capital stock have been duly authorized and
validly issued and are fully paid and non-assessable; and none of the
outstanding shares of capital stock of the Company was issued in violation of
the preemptive or other similar rights of any securityholder of the Company.
(v) The Securities to be purchased by the U.S. Underwriters and the
International Managers from the Company have been duly authorized for issuance
and sale to the Underwriters pursuant to the U.S. Purchase Agreement and the
International Purchase Agreement, respectively, and, when issued and delivered
by the Company pursuant to the U.S. Purchase Agreement and the International
Purchase Agreement, respectively, against payment of the consideration set forth
in the U.S. Purchase Agreement and the International Purchase Agreement, will be
validly issued and fully paid and non-assessable.
(vi) The issuance of the Securities is not subject to the preemptive or
other similar rights of any securityholder of the Company.
A-1-1
<PAGE>
(vii) Each Significant Subsidiary is a corporation validly organized and
existing as a corporation under the laws of its jurisdiction of incorporation,
has corporate power and authority to own its properties and to conduct its
business as described in the Prospectuses and is duly qualified as a foreign
corporation to transact business and is in good standing in each jurisdiction in
which such qualification is required, whether by reason of the ownership or
leasing of property or the conduct of business, except where the failure so to
qualify or to be in good standing would not result in a Material Adverse Effect;
except as otherwise disclosed in the Registration Statement, all of the issued
and outstanding capital stock of each Subsidiary has been duly authorized and
validly issued, is fully paid and non-assessable and, to the best of my
knowledge (except for non-material liens that have arisen in the ordinary course
of business and in the case of foreign subsidiaries, for directors qualifying
shares) is owned by the Company, directly or indirectly, free and clear of all
liens, encumbrances, security interests and claims.
(viii) The U.S. Purchase Agreement and the International Purchase Agreement
have been duly authorized, executed and delivered by the Company.
(ix) The documents incorporated by reference in the Prospectuses (other
than the financial statements, the notes thereto and supporting schedules and
other financial or accounting data included therein or omitted therefrom, as to
which I express no opinion), when they were filed with the Commission complied
as to form in all material respects with the requirements of the 1934 Act and
the rules and regulations of the Commission thereunder.
(x) The form of certificate used to evidence the Common Stock complies in
all material respects with all applicable statutory requirements, with any
applicable requirements of the charter and by-laws of the Company, and with the
requirements of the New York Stock Exchange.
(xi) To the best of my knowledge, except as disclosed in the Prospectuses,
there is not pending or threatened any action, suit, proceeding, inquiry or
investigation, to which the Company or any subsidiary is a party, or to which
the property of the Company or any subsidiary is subject, before or brought by
any court or governmental agency or body, domestic or foreign, which could
reasonably be expected to result in a Material Adverse Effect, or which could
reasonably be expected to materially and adversely affect the consummation of
the transactions contemplated in the U.S. Purchase Agreement and International
Purchase Agreement or the performance by the Company of its obligations
thereunder.
(xii) The information in the Prospectuses under "Description of Common
Stock", and in "Legal Proceedings" incorporated by reference in the Company's
Annual Report on Form 10-K for the fiscal year ended June 30, 1996 and in the
Registration Statement under Item 15, insofar as such information constitutes a
summary of the legal matters, documents or proceedings referred to therein,
fairly presents the information called for with respect to such legal matters,
documents or proceedings.
A-1-2
<PAGE>
(xiii) To the best of my knowledge, there are no franchises, contracts,
indentures, mortgages, loan agreements, notes, leases or other instruments
required to be described or referred to in the Registration Statement or to be
filed as exhibits thereto other than those described or referred to therein or
filed or incorporated by reference as exhibits thereto.
(xiv) Neither the Company nor any of its Subsidiaries is, or, based upon
presently existing circumstances with the giving of notice or lapse of time of
both would be, in violation of or in default under, their respective restated
articles of organization, certificate of incorporation or other similar charter
document or by-laws or any contract, indenture, mortgage, deed of trust, loan
agreement, note, lease or other agreement or instrument known to such counsel to
which the Company or any of its Subsidiaries is party or by which it or any of
them or any of their respective properties is bound, except for violations and
defaults which would not result in a Material Adverse Effect.
(xv) No filing with, or authorization, approval, consent, license, order,
registration, qualification or decree of, any court or governmental authority or
agency, domestic or foreign (other than under the 1933 Act and the 1933 Act
Regulations, which have been obtained, or as may be required under the
securities or blue sky laws of the various states, as to which I need express no
opinion) is necessary or required in connection with the due authorization,
execution and delivery of the U.S. Purchase Agreement and the International
Purchase Agreement or for the offering, issuance, sale or delivery of the
Securities.
(xvi) To the best of such counsel's knowledge, no holders of the Company's
securities have rights to the registration of shares of Common Stock or other
securities as a result of the filing of the Registration Statement by the
Company or the offering contemplated hereby, except pursuant to the Kendall
Registration Rights Agreement.
(xvii) The execution, delivery and performance of the U.S. Purchase
Agreement and the International Purchase Agreement and the consummation of the
transactions contemplated in the U.S. Purchase Agreement, the International
Purchase Agreement and in the Registration Statement (including the issuance and
sale of the Securities, and the use of the proceeds from the sale of the
Securities as described in the Prospectuses under the caption "Use Of Proceeds")
and compliance by the Company with its obligations under the U.S. Purchase
Agreement and the International Purchase Agreement do not and will not, whether
with or without the giving of notice or lapse of time or both, conflict with or
constitute a breach of, or default or Repayment Event (as defined in Section
1(a)(xi) of the Purchase Agreements) under or result in the creation or
imposition of any lien, charge or encumbrance upon any property or assets of the
Company or any subsidiary pursuant to any contract, indenture, mortgage, deed of
trust, loan or credit agreement, note, lease or any other agreement or
instrument, known to me, to which the Company or any subsidiary is a party or by
which it or any of them may be bound, or to which any of the property or assets
of the Company or any subsidiary is subject (except
A-1-3
<PAGE>
for such conflicts, breaches or defaults or liens, charges or encumbrances that
would not have a Material Adverse Effect), nor will such action result in any
violation of the provisions of the charter or by-laws of the Company or any
subsidiary, or any applicable law, statute, rule, regulation, judgment, order,
writ or decree, known to me, of any government, government instrumentality or
court, domestic or foreign, having jurisdiction over the Company or any
subsidiary or any of their respective properties, assets or operations.
(xviii) The Company is not an "investment company" or an entity
"controlled" by an "investment company," as such terms are defined in the 1940
Act.
Although such counsel has not undertaken to determine independently the
accuracy and completeness of the statements contained in the Registration
Statement or the Prospectuses, such counsel has obtained information as a result
of discussions and meetings with officers and other representatives of the
Company and its Subsidiaries and discussions with representatives of and
independent public accountants of the Company, in connection with the
preparation of the Registration Statement and the Prospectuses, and the
examination of other information and documents requested by such counsel.
Although such counsel has not undertaken to determine independently, and
therefore, such counsel does not assume responsibility, explicitly or
implicitly, for the accuracy and completeness of the statements contained in the
Registration Statement or the Prospectuses, and such counsel cannot provide
assurance that the procedures described in the preceding sentence would
necessarily reveal matters of significance with respect to the following
comments, during the course of the above-described procedures, nothing has come
to such counsel's attention that has caused such counsel to believe that the
Registration Statement (including the Rule 430A Information, if applicable, and
any amendment thereto) or the Prospectuses (including, in each case, the
documents incorporated by reference therein), on the effective date thereof, or
on the date of the Agreement, contained an untrue statement of a material fact
or omitted to state a material fact required to be stated therein or necessary
to make the statements therein not misleading or that the Prospectuses or any
amendment or supplement thereto, on the date of such opinion, contains an untrue
statement of a material fact or omitted or omits to state a material fact
required to be stated therein or necessary to make the statement therein, in
light of the circumstances under which they were made, not misleading (it being
understood that such counsel need express no view with respect to financial
statements, the notes thereto and related schedules and other financial or
accounting data included in the Registration Statement or the Prospectuses).
In rendering such opinion, such counsel may rely as to matters of fact (but
not as to legal conclusions), to the extent they deem proper, on certificates of
responsible officers of the Company and public officials. Such opinion shall not
state that it is to be governed or qualified by, or that it is otherwise subject
to, any treatise, written policy or other document relating to legal opinions,
including, without limitation, the Legal Opinion Accord of the ABA Section of
Business Law (1991).
A-1-4
<PAGE>
Exhibit A-2
FORM OF OPINION OF COMPANY'S
COUNSEL TO BE DELIVERED PURSUANT
TO SECTION 5(c)
(i) The Registration Statement, including any Rule 462(b) Registration
Statement, has been declared effective under the 1933 Act; any required filing
of the Prospectuses pursuant to Rule 424(b) has been made in the manner and
within the time period required by Rule 424(b); and, to the best of our
knowledge, no stop order suspending the effectiveness of the Registration
Statement or any Rule 462(b) Registration Statement has been issued under the
1933 Act and no proceedings for that purpose have been instituted or are pending
or, to such counsel's knowledge, threatened by the Commission.
(ii) The Registration Statement, including any Rule 462(b) Registration
Statement, the Rule 430A Information and the Rule 434 Information, as
applicable, the Prospectuses, excluding the documents incorporated by reference
therein, and each amendment or supplement to the Registration Statement and the
Prospectuses, excluding the documents incorporated by reference therein, as of
their respective effective or issue dates (other than the financial statements,
the notes thereto and supporting schedules and other financial or accounting
data included therein or omitted therefrom, as to which we need express no
opinion) complied as to form in all material respects with the requirements of
the 1933 Act and the 1933 Act Regulations.
(iii) All of the Registrable Securities (other than Registrable Securities
held pursuant to Warrants) under the Kendall Registration Rights Agreement are
freely tradeable under the United States federal securities laws (including
pursuant to Rule 144 of the 1933 Act Regulations, without regard to the volume
limitations thereunder).
(iv) The statements made in the International Prospectus under "Certain
United States Federal Tax Consequences to Non-U.S. Holders of Common Stock," to
the extent that they are statements of United States federal laws or legal
conclusions thereunder, have been reviewed by such counsel and fairly present
the information disclosed therein in all material respects.
Although such counsel has not undertaken to determine independently the
accuracy and completeness of the statements contained in the Registration
Statement or the Prospectuses, such counsel has obtained information as a result
of discussions and meetings with officers and other representatives of the
Company and its Subsidiaries and discussions with representatives of and
independent public accountants of the Company, in connection with the
preparation of the Registration Statement and the Prospectuses, and the
examination of other information and documents requested by such counsel.
Although such counsel has not undertaken to determine independently, and
therefore, such counsel does not assume responsibility, explicitly or
implicitly, for the accuracy and completeness of the statements contained in the
Registration Statement or the
A-2-1
<PAGE>
Prospectuses, and such counsel cannot provide assurance that the procedures
described in the preceding sentence would necessarily reveal matters of
significance with respect to the following comments, during the course of the
above-described procedures, nothing has come to such counsel's attention that
has caused such counsel to believe that the Registration Statement (including
the Rule 430A Information, if applicable, and any amendment thereto) or the
Prospectuses (including, in each case, the documents incorporated by reference
therein), on the date or effective date thereof, or on the date of the
Agreement, contained an untrue statement of a material fact or omitted to state
a material fact required to be stated therein or necessary to make the
statements therein not misleading or that the Prospectuses or any amendment or
supplement thereto, on the date of such opinion, contains an untrue statement of
a material fact or omitted or omits to state a material fact required to be
stated therein or necessary to make the statement therein, in light of the
circumstances under which they were made, not misleading (it being understood
that such counsel need express no view with respect to financial statements, the
notes thereto and related schedules and other financial or accounting data
included in the Registration Statement or the Prospectuses).
In rendering such opinion, such counsel may rely as to matters of fact (but
not as to legal conclusions), to the extent they deem proper, on certificates of
responsible officers of the Company and public officials. Such opinion shall not
state that it is to be governed or qualified by, or that it is otherwise subject
to, any treatise, written policy or other document relating to legal opinions,
including, without limitation, the Legal Opinion Accord of the ABA Section of
Business Law (1991).
A-2-2
<PAGE>
Form of lock up from officers pursuant to Section 5(i)
Exhibit B
MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated,
Credit Suisse First Corporation
Lehman Brothers Inc.
J.P. Morgan Securities Inc.
as U.S. Representatives of the several
U.S. Underwriters to be named in the
within-mentioned U.S. Purchase Agreement
c/o Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
North Tower
World Financial Center
New York, New York 10281-1209
Re: Proposed Public Offering by Tyco International Ltd.
Dear Sirs:
The undersigned, a shareholder and an officer of Tyco International Ltd., a
Massachusetts corporation (the "Company"), understands that Merrill Lynch & Co.,
Merrill Lynch, Pierce, Fenner & Smith Incorporated ("Merrill Lynch"), Credit
Suisse First Boston Corporation, Lehman Brothers Inc. and J.P. Morgan Securities
Inc. propose to enter into a U.S. Purchase Agreement (the "U.S. Purchase
Agreement") with the Company providing for the public offering of shares (the
"Securities") of the Company's common stock, par value $.50 per share (the
"Common Stock"). In recognition of the benefit that such an offering will confer
upon the undersigned as a shareholder and an officer of the Company, and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the undersigned agrees with each underwriter to be named in
the U.S. Purchase Agreement that, during a period of 60 days from the date of
the U.S. Purchase Agreement, the undersigned will not, without the prior written
consent of Merrill Lynch, directly or indirectly, (i) offer, pledge, sell,
contract to sell, sell any option or contract to purchase, purchase any option
or contract to sell, grant any option, right or warrant for the sale of, or
otherwise dispose of or transfer any shares of the Company's Common Stock or any
securities convertible into or exchangeable or exercisable for Common Stock,
whether now owned or hereafter acquired by the undersigned or with respect to
which the undersigned has or hereafter acquires the power of disposition, or
file any registration statement under the Securities Act of 1933, as amended,
with respect to any of the foregoing or (ii) enter into any swap or any other
agreement or any transaction that transfers, in whole or in part, directly or
indirectly, the economic consequence of ownership of the Common Stock, whether
B-1
<PAGE>
any such swap or transaction is to be settled by delivery of Common Stock or
other securities, in cash or otherwise. The foregoing sentence shall not apply
to (A) any transfer of shares of Common Stock to a charitable organization or
trust, (B) any transfer of shares of Common Stock to the Company in connection
with the payment of taxes or repayment of any loan from the Company pursuant to
the Company's Restricted Stock Ownership Plan or (C) any transfer to an
immediate family member of the undersigned or to a trust for the benefit thereof
who agrees in writing to be bound by the terms of this letter as if a signatory
hereto.
Very truly yours,
Signature:
Print Name:
B-2
================================================================================
TYCO INTERNATIONAL LTD.
(a Massachusetts corporation)
2,000,000 Shares of Common Stock
INTERNATIONAL PURCHASE AGREEMENT
Dated: February 27, 1997
================================================================================
<PAGE>
Table of Contents
Page
----
INTERNATIONAL PURCHASE AGREEMENT...............................................1
SECTION 1. Representations and Warranties...................................4
(a) Representations and Warranties by the Company.........................4
(i) Compliance with Registration Requirements...................4
(ii) Incorporated Documents......................................5
(iii) Independent Accountants.....................................5
(iv) Financial Statements........................................5
(v) No Material Adverse Change in Business......................5
(vi) Good Standing of the Company................................6
(vii) Good Standing of Subsidiaries...............................6
(viii) Capitalization..............................................6
(ix) Authorization of Agreement..................................7
(x) Authorization and Description of Securities.................7
(xi) Absence of Defaults and Conflicts...........................7
(xii) Absence of Labor Dispute....................................8
(xiii) Absence of Proceedings......................................8
(xiv) Accuracy of Exhibits........................................8
(xv) Absence of Further Requirements.............................8
(xvi) Compliance with Cuba Act....................................8
(xvii) Investment Company Act......................................9
(b) Officer's Certificates................................................9
SECTION 2. Sale and Delivery to International Managers; Closing.............9
(a) Initial Securities....................................................9
(b) Option Securities.....................................................9
(c) Payment..............................................................10
(d) Denominations; Registration..........................................10
SECTION 3. Covenants of the Company........................................11
(a) Compliance with Securities Regulations and Commission Requests.......11
(b) Filing of Amendments.................................................11
(c) Delivery of Registration Statements..................................11
(d) Delivery of Prospectuses.............................................11
(e) Continued Compliance with Securities Laws............................12
(f) Blue Sky Qualifications..............................................12
(g) Rule 158.............................................................13
(h) Use of Proceeds......................................................13
(i) Listing..............................................................13
(j) Restriction on Sale of Securities....................................13
(k) Reporting Requirements...............................................13
<PAGE>
Page
----
SECTION 4. Payment of Expenses.............................................13
(a) Expenses.............................................................13
(b) Termination of Agreement.............................................14
SECTION 5. Conditions of International Managers' Obligations...............14
(a) Effectiveness of Registration Statement..............................14
(b) Opinion of General Counsel of Company................................14
(c) Opinion of Counsel for Company.......................................15
(d) Opinion of Counsel for International Managers........................15
(e) Officers' Certificate................................................15
(f) Accountant's Comfort Letter..........................................16
(g) Bring-down Comfort Letter............................................16
(h) Approval of Listing..................................................16
(i) Lock-up Agreements...................................................16
(j) Indemnification Agreement............................................16
(k) Certificate of Chief Financial Officer...............................16
(l) Purchase of Initial U.S. Securities..................................16
(m) Conditions to Purchase of International Option Securities............16
(n) Additional Documents.................................................17
(o) Termination of Agreement.............................................17
SECTION 6. Indemnification.................................................18
(a) Indemnification of International Managers............................18
(b) Indemnification of Company, Directors and Officers...................19
(c) Actions against Parties; Notification................................19
(d) Settlement without Consent if Failure to Reimburse...................20
SECTION 7. Contribution....................................................20
SECTION 8. Representations, Warranties and Agreements to Survive Delivery..22
SECTION 9. Termination of Agreement........................................22
(a) Termination; General.................................................22
(b) Liabilities..........................................................22
SECTION 10. Default by One or More of the International Managers...........22
SECTION 11. Notices........................................................23
SECTION 12. Parties........................................................23
SECTION 13. Governing Law and Time.........................................23
SECTION 14. Effect of Headings.............................................23
ii
<PAGE>
Page
----
SCHEDULES
Schedule A - List of Underwriters................................Sch A-1
Schedule B - Pricing Information.................................Sch B-1
Schedule C - List of Persons subject to Lock-up..................Sch C-1
EXHIBITS
Exhibit A-1 - Form of Opinion of General Counsel of Company........A-1-1
Exhibit A-2 - Form of Opinion of Company's Counsel.................A-2-1
Exhibit B - Form of Lock-up Letter...................................B-1
iii
<PAGE>
TYCO INTERNATIONAL LTD.
(a Massachusetts corporation)
2,000,000 Shares of Common Stock
(Par Value $.50 Per Share)
INTERNATIONAL PURCHASE AGREEMENT
February 27, 1997
MERRILL LYNCH INTERNATIONAL
CREDIT SUISSE FIRST BOSTON (EUROPE) LIMITED
LEHMAN BROTHERS INTERNATIONAL (EUROPE)
J.P. MORGAN SECURITIES LTD.
as Lead Managers of the several International Managers
c/o Merrill Lynch International
Ropemaker Place
25 Ropemaker Street
London EC2Y 9LY
England
Ladies and Gentlemen:
Tyco International Ltd., a Massachusetts corporation (the "Company"),
confirms its agreement with Merrill Lynch International ("Merrill Lynch") and
each of the other international underwriters named in Schedule A hereto
(collectively, the "International Managers," which term shall also include any
underwriter substituted as hereinafter provided in Section 10 hereof), for whom
Merrill Lynch, Credit Suisse First Boston (Europe) Limited, Lehman Brothers
International (Europe) and J.P. Morgan Securities Ltd. are acting as
representatives (in such capacity, the "Lead Managers"), with respect to the
issue and sale by the Company and the purchase by the International Managers,
acting severally and not jointly, of the respective numbers of shares of Common
Stock, par value $.50 per share, of the Company ("Common Stock") set forth in
said Schedule A, and with respect to the grant by the Company to the
International Managers, acting severally and not jointly, of the option
described in Section 2(b) hereof to purchase all or any part of 300,000
additional shares of Common Stock to cover over-allotments, if any. The
aforesaid 2,000,000 shares of Common Stock (the "Initial International
Securities") to be purchased by the International Managers and all or any part
of the 300,000 shares of Common Stock subject to the option described in Section
2(b) hereof (the
<PAGE>
"International Option Securities") are hereinafter called, collectively, the
"International Securities."
It is understood that the Company is concurrently entering into an
agreement dated the date hereof (the "U.S. Purchase Agreement") providing for
the offering by the Company of an aggregate of 8,000,000 shares of Common Stock
(the "Initial U.S. Securities") through arrangements with certain underwriters
in the United States and Canada (the "U.S. Underwriters") for whom Merrill
Lynch, Pierce, Fenner & Smith Incorporated, Credit Suisse First Boston
Corporation, Lehman Brothers Inc. and J.P. Morgan Securities Inc. are acting as
representatives (the "U.S. Representatives") and the grant by the Company to the
U.S. Underwriters, acting severally and not jointly, of an option to purchase
all or any part of the U.S. Underwriters' pro rata portion of up to 1,200,000
additional shares of Common Stock solely to cover overallotments, if any (the
"U.S. Option Securities"). The Initial U.S. Securities and the U.S. Option
Securities are hereinafter called the "U.S. Securities." It is understood that
the Company is not obligated to sell and the International Managers are not
obligated to purchase, any Initial International Securities unless all of the
Initial U.S. Securities are contemporaneously purchased by the U.S.
Underwriters.
The International Managers and the U.S. Underwriters are hereinafter
collectively called the "Underwriters," the Initial International Securities and
the Initial U.S. Securities are hereinafter collectively called the "Initial
Securities," the International Securities and the U.S. Securities are
hereinafter collectively called the "Securities" and the International Option
Securities and the U.S. Option Securities are hereinafter collectively called
the "Option Securities."
The Underwriters will concurrently enter into an Intersyndicate Agreement
of even date herewith (the "Intersyndicate Agreement") providing for the
coordination of certain transactions among the Underwriters under the direction
of Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated (in
such capacity, the "Global Coordinator").
The Company understands that the International Managers propose to make a
public offering of the International Securities as soon as the Lead Managers
deem advisable after this Agreement has been executed and delivered.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (No. 333-20741) covering the
registration of the Securities under the Securities Act of 1933, as amended (the
"1933 Act"), and the offering thereof from time to time in accordance with Rule
415 of the rules and regulations of the Commission under the 1933 Act (the "1933
Act Regulations"). Such registration statement (as amended, if applicable) has
been declared effective by the Commission (any preliminary prospectus included
in such registration statement or filed with the Commission pursuant to Rule
424(a) of the rules and regulations of the 1933 Act Regulations or any
preliminary prospectus supplement specifically relating to the Securities filed
with the Commission pursuant to Rule 424(b) of the 1933 Act Regulations being
hereinafter called a "Preliminary Prospectus"). The information included in any
such prospectus or in any such Term Sheet, as the case may be, that
2
<PAGE>
was omitted from such registration statement at the time it became effective but
that is deemed to be part of such registration statement at the time it became
effective (a) pursuant to paragraph (b) of Rule 430A is referred to as "Rule
430A Information" or (b) pursuant to paragraph (d) of Rule 434 is referred to as
"Rule 434 Information." Any registration statement filed pursuant to Rule 462(b)
of the 1933 Act Regulations is herein referred to as the "Rule 462(b)
Registration Statement," and after such filing the term "Registration Statement"
shall include the Rule 462(b) Registration Statement. Such registration
statement and any post effective amendment thereto and the prospectus
constituting a part thereof, and each prospectus supplement relating to the
offering of Securities (the "Prospectus Supplement"), including all documents
incorporated therein by reference, and including the Rule 430A Information and
the Rule 434 Information, as applicable, as from time to time amended or
supplemented pursuant to the 1933 Act, the Securities Exchange Act of 1934, as
amended (the "1934 Act") or otherwise, are collectively referred to herein as
the "Registration Statement" and the "Prospectus," respectively; provided, that
a Prospectus Supplement shall be deemed to have supplemented the Prospectus only
with respect to the offering of Securities to which it relates. Any registration
statement filed pursuant to Rule 462(b) of the 1933 Act Regulations is herein
referred to as the "Rule 462(b) Registration Statement," and after such filing
the term "Registration Statement" shall include the Rule 462(b) Registration
Statement. Promptly after execution and delivery of this Agreement, the Company
will either (i) prepare and file a prospectus in accordance with the provisions
of Rule 430A ("Rule 430A") of the rules and regulations of the Commission under
the 1933 Act (the "1933 Act Regulations") and paragraph (b) of Rule 424 ("Rule
424(b)") of the 1933 Act Regulations or (ii) if the Company has elected to rely
upon Rule 434 ("Rule 434") of the 1933 Act Regulations, prepare and file a term
sheet (a "Term Sheet") in accordance with the provisions of Rule 434 and Rule
424(b). Two forms of prospectus supplement are to be used in connection with the
offering and sale of the Securities: one relating to the International
Securities (the "Form of International Prospectus Supplement") and one relating
to the U.S. Securities (the "Form of U.S. Prospectus Supplement"). The Form of
International Prospectus Supplement is identical to the Form of U.S. Prospectus
Supplement, except for the front cover and back cover pages and the information
under the caption "Underwriting" and the inclusion in the Form of International
Prospectus Supplement of a section under the caption "Certain United States Tax
Considerations for Non-United States Holders." The final Form of International
Prospectus Supplement and the final Form of U.S. Prospectus Supplement,
including the documents incorporated by reference therein pursuant to Item 12 of
Form S-3 under the 1933 Act, and including the prospectus constituting a part of
the Registration Statement, in the forms first furnished to the Underwriters for
use in connection with the offering of the Securities are herein called the
"International Prospectus" and the "U.S. Prospectus," respectively, and
collectively, the "Prospectuses." If Rule 434 is relied on, the terms
"International Prospectus" and "U.S. Prospectus" shall refer to the preliminary
International Prospectus dated February 13, 1997 and preliminary U.S. Prospectus
dated February 13, 1997, respectively, each together with the applicable Term
Sheet and all references in this Agreement to the date of such Prospectuses
shall mean the date of the applicable Term Sheet. For purposes of this
Agreement, all references to the Registration Statement, any preliminary
prospectus, the Prospectuses, the Form of International Prospectus Supplement,
the Form of U.S. Prospectus Supplement or any Term Sheet or any amendment or
supplement to any of the foregoing shall be deemed to include the copy filed
with the Commission pursuant to its Electronic Data Gathering, Analysis and
Retrieval system ("EDGAR").
3
<PAGE>
All references in this Agreement to financial statements and schedules and
other information which is "contained," "included," "stated," "disclosed" or
"referred to" in the Registration Statement, any preliminary prospectus
(including the Form of U.S. Prospectus Supplement and Form of International
Prospectus Supplement) or the Prospectuses (or other references of like import)
shall be deemed to mean and include all such financial statements and schedules
and other information which is incorporated by reference in the Registration
Statement, any preliminary prospectus (including the Form of U.S. Prospectus
Supplement and Form of International Prospectus Supplement) or the Prospectuses,
as the case may be; and all references in this Agreement to amendments or
supplements to the Registration Statement, any preliminary prospectus or the
Prospectuses shall be deemed to mean and include the filing of any document
under the 1934 Act which is incorporated by reference in the Registration
Statement, such preliminary prospectus or the Prospectuses, as the case may be.
SECTION 1. Representations and Warranties.
(a) Representations and Warranties by the Company. The Company represents
and warrants to each International Manager as of the date hereof, as of the
Closing Time referred to in Section 2(c) hereof, and as of each Date of Delivery
(if any) referred to in Section 2(b) hereof, and agrees with each International
Manager, as follows:
(i) Compliance with Registration Requirements. The Company meets the
requirements for use of Form S-3 under the 1933 Act. Each of the
Registration Statement and any Rule 462(b) Registration Statement has
become effective under the 1933 Act and no stop order suspending the
effectiveness of the Registration Statement or any Rule 462(b)
Registration Statement has been issued under the 1933 Act and no
proceedings for that purpose have been instituted or are pending or, to
the knowledge of the Company, are contemplated by the Commission, and any
request on the part of the Commission for additional information has been
complied with.
At the respective times the Registration Statement, any Rule 462(b)
Registration Statement and any post-effective amendments thereto became
effective and at the Closing Time (and, if any International Option
Securities are purchased, at the Date of Delivery), the Registration
Statement, the Rule 462(b) Registration Statement and any amendments and
supplements thereto complied and will comply in all material respects with
the requirements of the 1933 Act and the 1933 Act Regulations and did not
and will not contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make
the statements therein not misleading. Neither of the Prospectuses nor any
amendments or supplements thereto, at the time the Prospectuses or any
amendments or supplements thereto were issued and at the Closing Time
(and, if any International Option Securities are purchased, at the Date of
Delivery), included or will include an untrue statement of a material fact
or omitted or will omit to state a material fact necessary in order to
make the statements therein, in the light of the circumstances under which
they were made, not misleading. If Rule 434 is used, the Company will
comply with the requirements of Rule 434. The representations and
warranties in this subsection shall not apply to statements in or
omissions from the
4
<PAGE>
Registration Statement or the International Prospectus made in reliance
upon and in conformity with information furnished to the Company in
writing by any International Manager through the Lead Managers expressly
for use in the Registration Statement or the International Prospectus.
Each preliminary prospectus and the prospectuses filed as part of
the Registration Statement as originally filed or as part of any amendment
thereto, or filed pursuant to Rule 424 under the 1933 Act, complied when
so filed in all material respects with the 1933 Act Regulations and each
preliminary prospectus and the Prospectuses delivered to the Underwriters
for use in connection with this offering were identical to the
electronically transmitted copies thereof filed with the Commission
pursuant to EDGAR, except to the extent permitted by Regulation S-T.
(ii) Incorporated Documents. The documents incorporated or deemed to
be incorporated by reference in the Registration Statement and the
Prospectuses, at the time they were or hereafter are filed with the
Commission, complied and will comply in all material respects with the
requirements of the 1934 Act and the rules and regulations of the
Commission thereunder (the "1934 Act Regulations"), and, when read
together with the other information in the Prospectuses, at the time the
Registration Statement became effective, at the time the Prospectuses were
issued and at the Closing Time (and, if any International Option
Securities are purchased, at the Date of Delivery), did not and will not
contain an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements
therein not misleading.
(iii) Independent Accountants. The accountants who certified the
financial statements and supporting schedules included in the Registration
Statement are independent public accountants as required by the 1933 Act
and the 1933 Act Regulations.
(iv) Financial Statements. The financial statements included in the
Registration Statement and the Prospectuses, together with the related
schedules and notes, present fairly the financial position of the Company
and its consolidated subsidiaries at the dates indicated and the statement
of operations, stockholders' equity and cash flows of the Company and its
consolidated subsidiaries 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
("GAAP") applied on a consistent basis throughout the periods involved.
The supporting schedules, if any, included in the Registration Statement
present fairly in accordance with GAAP the information required to be
stated therein. The selected financial data and the summary financial
information included in the Prospectuses present fairly the information
shown therein and have been compiled on a basis consistent with that of
the audited financial statements included in the Registration Statement.
(v) No Material Adverse Change in Business. Since the respective
dates as of which information is given in the Registration Statement and
the Prospectuses, except as
5
<PAGE>
otherwise stated therein, (A) there has been no material adverse change in
the condition, financial or otherwise, earnings, business affairs or
business prospects of the Company and its subsidiaries considered as one
enterprise, whether or not arising in the ordinary course of business (a
"Material Adverse Effect"), (B) there have been no transactions entered
into by the Company or any of its subsidiaries, other than those in the
ordinary course of business, which are material with respect to the
Company and its subsidiaries considered as one enterprise, and (C) except
for regular quarterly dividends on the Common Stock in amounts per share
that are consistent with past practice, there has been no dividend or
distribution of any kind declared, paid or made by the Company on any
class of its capital stock.
(vi) Good Standing of the Company. The Company has been duly
organized and is validly existing as a corporation in good standing under
the laws of the Commonwealth of Massachusetts with power and authority
(corporate and other) under such laws to own, lease and operate its
properties and to conduct its business as described in the Prospectuses
and to enter into and perform its obligations under this Agreement and the
U.S. Purchase Agreement; and the Company is duly qualified as a foreign
corporation to transact business and is in good standing in each other
jurisdiction in which such qualification is required, whether by reason of
the ownership or leasing of property or the conduct of business, except
where the failure so to qualify or to be in good standing would not result
in a Material Adverse Effect.
(vii) Good Standing of Subsidiaries. Each "significant subsidiary"
of the Company (as such term is defined in Rule 1-02 of Regulation S-X)
(each a "Significant Subsidiary" and all of the Company's subsidiaries are
collectively hereinafter referred to as the "Subsidiaries") has been duly
organized and is validly existing as a corporation under the laws of its
jurisdiction of incorporation, has corporate power and authority to own
its properties and to conduct its business as described in the
Prospectuses and is duly qualified as a foreign corporation to transact
business and is in good standing in each jurisdiction in which such
qualification is required, whether by reason of the ownership or leasing
of property or the conduct of business, except where the failure to be so
qualified or in good standing would not result in a Material Adverse
Effect; except as otherwise disclosed in the Registration Statement, all
of the issued and outstanding capital stock of each such Significant
Subsidiary has been duly authorized and validly issued, is fully paid and
non-assessable and (except for non-material liens that have arisen in the
ordinary course of business and, in the case of foreign subsidiaries, for
directors' qualifying shares) is owned by the Company, directly or
indirectly, free and clear of all liens, encumbrances, security interests
and claims.
(viii) Capitalization. The Company has authorized, issued and
outstanding capital stock as set forth in the Prospectuses under the
caption "Capitalization" (except for subsequent issuances, if any,
pursuant to this Agreement, pursuant to reservations, agreements or
employee benefit plans referred to in the Prospectuses or pursuant to the
exercise of convertible securities or options referred to in the
Prospectuses). The shares of issued and outstanding capital stock of the
Company have been duly authorized and
6
<PAGE>
validly issued and are fully paid and non-assessable; none of the
outstanding shares of capital stock of the Company was issued in violation
of the preemptive or other similar rights of any securityholder of the
Company. Except as disclosed in the Prospectuses, there are no holders of
securities (debt or equity) of the Company or any of its Subsidiaries, or
holders of rights (including, without limitation, preemptive rights),
warrants or options to obtain securities of the Company or its
Subsidiaries who have the right to request the Company or any of its
Subsidiaries to register securities held by them under the 1933 Act other
than holders who have elected not to exercise their rights. All of the
Registrable Securities (other than Registrable Securities constituting or
issued or issuable upon exercise of Warrants) under the Registration
Rights Agreement, dated as of July 7, 1992 among Kendall International
Inc. (whose obligations have been assumed by the Company) and the
stockholders and other parties named therein (the "Kendall Registration
Rights Agreement") are freely tradeable under the United States federal
securities laws (including pursuant to Rule 144 of the 1933 Act
Regulation, without regard to the volume limitations thereunder).
(ix) Authorization of Agreement. This Agreement and the U.S.
Purchase Agreement have been duly authorized, executed and delivered by
the Company.
(x) Authorization and Description of Securities. The Securities to
be purchased by the International Managers and the U.S. Underwriters from
the Company have been duly authorized for issuance and sale to the
International Managers pursuant to this Agreement and to the U.S.
Underwriters pursuant to the U.S. Purchase Agreement, respectively, and,
when issued and delivered by the Company pursuant to this Agreement and
the U.S. Purchase Agreement, respectively, against payment of the
consideration set forth herein and in the U.S. Purchase Agreement,
respectively, will be validly issued, fully paid and non-assessable; the
Common Stock conforms to all statements relating thereto contained in the
Prospectuses and such description conforms to the rights set forth in the
instruments defining the same; and the issuance of the Securities is not
subject to the preemptive or other similar rights of any securityholder of
the Company.
(xi) Absence of Defaults and Conflicts. Neither the Company nor any
of its Subsidiaries is in violation of its charter or by-laws or in
default in the performance or observance of any obligation, agreement,
covenant or condition contained in any contract, indenture, mortgage, deed
of trust, loan or credit agreement, note, lease or other agreement or
instrument to which the Company or any of its Subsidiaries is a party or
by which it or any of them may be bound, or to which any of the property
or assets of the Company or any subsidiary is subject (collectively,
"Agreements and Instruments") except for such defaults that would not
result in a Material Adverse Effect; and the execution, delivery and
performance of this Agreement and the U.S. Purchase Agreement and the
consummation of the transactions contemplated in this Agreement, the U.S.
Purchase Agreement and in the Registration Statement (including the
issuance and sale of the Securities and the use of the proceeds from the
sale of the Securities as described in the Prospectuses under the caption
"Use of Proceeds") and compliance by the Company with its obligations
under this Agreement and the U.S. Purchase Agreement have been
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duly authorized by all necessary corporate action and do not and will not,
whether with or without the giving of notice or passage of time or both,
conflict with or constitute a breach of, or default or Repayment Event (as
defined below) under, or result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the Company or any
subsidiary pursuant to, the Agreements and Instruments (except for such
conflicts, breaches or defaults or liens, charges or encumbrances that
would not result in a Material Adverse Effect), nor will such action
result in any violation of the provisions of the charter or by-laws of the
Company or any subsidiary or any law, statute, rule, regulation, judgment,
order, writ or decree applicable to the Company or of any government,
government instrumentality or court, domestic or foreign, having
jurisdiction over the Company or any subsidiary or any of their assets,
properties or operations. As used herein, a "Repayment Event" means any
event or condition which gives the holder of any note, debenture or other
evidence of indebtedness (or any person acting on such holder's behalf)
the right to require the repurchase, redemption or repayment of all or a
portion of such indebtedness by the Company or any subsidiary.
(xii) Absence of Labor Dispute. Except as disclosed in the
Prospectuses, no labor dispute with the employees of the Company or any
subsidiary exists or, to the knowledge of the Company, is imminent, which
could reasonably be expected to result in a Material Adverse Effect.
(xiii) Absence of Proceedings. Except as disclosed in the
Prospectuses, there is no action, suit, proceeding, inquiry or
investigation before or brought by any court or governmental agency or
body, domestic or foreign, now pending, or, to the knowledge of the
Company, threatened, against or affecting the Company or any Subsidiary,
which is required to be disclosed in the Registration Statement, or which
could reasonably be expected to result in a Material Adverse Effect, or
which could reasonably be expected to materially and adversely affect the
consummation of the transactions contemplated in this Agreement and the
U.S. Purchase Agreement or the performance by the Company of its
obligations hereunder or thereunder.
(xiv) Accuracy of Exhibits. There are no contracts or documents
which are required to be described in the Registration Statement, the
Prospectuses or the documents incorporated by reference therein or to be
filed as exhibits thereto which have not been so described and filed as
required.
(xv) Absence of Further Requirements. No filing with, or
authorization, approval, consent, license, order, registration,
qualification or decree of, any court or governmental authority or agency
is necessary or required for the performance by the Company of its
obligations hereunder, in connection with the offering, issuance or sale
of the Securities under this Agreement and the U.S. Purchase Agreement or
the consummation of the transactions contemplated by this Agreement and
the U.S. Purchase Agreement, except such as have been already obtained or
as may be required under the 1933 Act or the 1933 Act Regulations or
foreign or state securities or blue sky laws.
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(xvi) Compliance with Cuba Act. The Company has complied with, and
is and will be in compliance with, the provisions of that certain Florida
act relating to disclosure of doing business with Cuba, codified as
Section 517.075 of the Florida statutes, and the rules and regulations
thereunder (collectively, the "Cuba Act") or is exempt therefrom.
(xvii) Investment Company Act. The Company is not, and upon the
issuance and sale of the Securities as herein contemplated and the
application of the net proceeds therefrom as described in the Prospectuses
will not be, an "investment company" or an entity "controlled" by an
"investment company" as such terms are defined in the Investment Company
Act of 1940, as amended (the "1940 Act").
(b) Officer's Certificates. Any certificate signed by any officer of the
Company or any of its Subsidiaries delivered to the Global Coordinator, the
International Managers or to counsel for the International Managers shall be
deemed a representation and warranty by the Company to each International
Manager as to the matters covered thereby.
SECTION 2. Sale and Delivery to International Managers; Closing.
(a) Initial Securities. On the basis of the representations and warranties
herein contained and subject to the terms and conditions herein set forth, the
Company agrees to sell to each International Manager, severally and not jointly,
and each International Manager, severally and not jointly, agrees to purchase
from the Company, at the price per share set forth in Schedule B, the number of
Initial International Securities set forth in Schedule A opposite the name of
such International Manager, plus any additional number of Initial International
Securities which such International Manager may become obligated to purchase
pursuant to the provisions of Section 10 hereof.
(b) Option Securities. In addition, on the basis of the representations
and warranties herein contained and subject to the terms and conditions herein
set forth, the Company hereby grants an option to the International Managers,
severally and not jointly, to purchase up to an additional 255,000 shares of
Common Stock at the price per share set forth in Schedule B, less an amount per
share equal to any dividends or distributions declared by the Company and
payable on the Initial International Securities but not payable on the
International Option Securities (for purposes of this agreement, dividends
declared by the Company subsequent to the Closing Time that are payable on
shares of Common Stock held as of a record date that is subsequent to a Date of
Delivery are payable on the International Option Securities). The option hereby
granted will expire 30 days after the date hereof and may be exercised in whole
or in part from time to time only for the purpose of covering over-allotments
which may be made in connection with the offering and distribution of the
Initial International Securities upon notice by the Global Coordinator to the
Company setting forth the number of International Option Securities as to which
the several International Managers are then exercising the option and the time
and date of payment and delivery for such International Option Securities. Any
such time and date of delivery for the International Option Securities (a "Date
of Delivery") shall be determined by the Global Coordinator, but shall not be
later than seven full business days after the exercise of said option, nor in
any event prior to the Closing Time, as hereinafter defined, or later than April
3,
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1997. If the option is exercised as to all or any portion of the International
Option Securities, each of the International Managers, acting severally and not
jointly, will purchase that proportion of the total number of International
Option Securities then being purchased which the number of Initial International
Securities set forth in Schedule A opposite the name of such International
Manager bears to the total number of Initial International Securities, subject
in each case to such adjustments as the Global Coordinator in its discretion
shall make to eliminate any sales or purchases of fractional shares.
(c) Payment. Payment of the purchase price for, and delivery of
certificates for, the Initial Securities shall be made at the offices of Fried,
Frank, Harris, Shriver & Jacobson, One New York Plaza, New York, New York 10004,
or at such other place as shall be agreed upon by the Global Coordinator and the
Company, at 9:00 A.M. (Eastern time) on the third (fourth, if the pricing occurs
after 4:30 P.M. (Eastern time) on any given day) business day after the date
hereof (unless postponed in accordance with the provisions of Section 10), or
such other time not later than ten business days after such date as shall be
agreed upon by the Global Coordinator and the Company (such time and date of
payment and delivery being herein called "Closing Time").
In addition, in the event that any or all of the International Option
Securities are purchased by the International Managers, payment of the purchase
price for, and delivery of certificates for, such International Option
Securities shall be made at the above-mentioned offices, or at such other place
as shall be agreed upon by the Global Coordinator and the Company, on each Date
of Delivery as specified in the notice from the Global Coordinator to the
Company, which Date of Delivery shall not be later than April 3, 1997.
Payment shall be made to the Company by wire transfer of immediately
available funds to a bank account designated by the Company, against delivery to
the Lead Managers for the respective accounts of the International Managers of
certificates for the International Securities to be purchased by them. It is
understood that each International Manager has authorized the Lead Managers, for
its account, to accept delivery of, receipt for, and make payment of the
purchase price for, the Initial International Securities and the International
Option Securities, if any, which it has agreed to purchase. Merrill Lynch,
individually and not as representative of the International Managers, may (but
shall not be obligated to) make payment of the purchase price for the Initial
International Securities or the International Option Securities, if any, to be
purchased by any International Manager whose funds have not been received by the
Closing Time or the relevant Date of Delivery, as the case may be, but such
payment shall not relieve such International Manager from its obligations
hereunder.
(d) Denominations; Registration. Certificates for the Initial
International Securities and the International Option Securities, if any, shall
be in such denominations and registered in such names as the Lead Managers may
request in writing at least one full business day before the Closing Time or the
relevant Date of Delivery, as the case may be. The certificates for the Initial
International Securities and the International Option Securities, if any, will
be made available for examination and packaging by the Lead Managers in The City
of New York not later than 10:00 A.M. (Eastern time) on the business day prior
to the Closing Time or the relevant Date of Delivery, as the case may be.
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SECTION 3. Covenants of the Company. The Company covenants with each
International Manager as follows:
(a) Compliance with Securities Regulations and Commission Requests.
The Company, subject to Section 3(b), will comply with the requirements of
Rule 430A or Rule 434, as applicable, and will notify the Global
Coordinator immediately, and confirm the notice in writing, (i) when any
post-effective amendment to the Registration Statement shall become
effective, or any supplement to the Prospectuses or any amended
Prospectuses shall have been filed, (ii) of the receipt of any comments
from the Commission, (iii) of any request by the Commission for any
amendment to the Registration Statement or any amendment or supplement to
the Prospectuses or for additional information, and (iv) of the issuance
by the Commission of any stop order suspending the effectiveness of the
Registration Statement or of any order preventing or suspending the use of
any preliminary prospectus, or of the suspension of the qualification of
the Securities for offering or sale in any jurisdiction, or of the
initiation or threatening of any proceedings for any of such purposes. The
Company will promptly effect the filings necessary pursuant to Rule 424(b)
and will take such steps as it deems necessary to ascertain promptly
whether the form of prospectus transmitted for filing under Rule 424(b)
was received for filing by the Commission and, in the event that it was
not, it will promptly file such prospectus. The Company will make every
reasonable effort to prevent the issuance of any stop order and, if any
stop order is issued, to obtain the lifting thereof at the earliest
possible moment.
(b) Filing of Amendments. The Company will give the Global
Coordinator notice of its intention to file or prepare any amendment to
the Registration Statement (including any filing under Rule 462(b)), any
Term Sheet or any amendment, supplement or revision to either the
prospectus included in the Registration Statement at the time it became
effective or to the Prospectuses, whether pursuant to the 1933 Act, the
1934 Act or otherwise, will furnish the Global Coordinator with copies of
any such documents a reasonable amount of time prior to such proposed
filing or use, as the case may be, and will not file or use any such
document to which the Global Coordinator or counsel for the International
Managers shall reasonably and timely object in writing.
(c) Delivery of Registration Statements. The Company has furnished
or will deliver to the Lead Managers and counsel for the International
Managers, without charge, signed copies of the Registration Statement as
originally filed and of each amendment thereto (including exhibits filed
therewith or incorporated by reference therein and documents incorporated
or deemed to be incorporated by reference therein) and signed copies of
all consents and certificates of experts. The copies of the Registration
Statement and each amendment thereto furnished to the International
Managers will be identical to the electronically transmitted copies
thereof filed with the Commission pursuant to EDGAR, except to the extent
permitted by Regulation S-T.
(d) Delivery of Prospectuses. The Company has delivered to each
International Manager, without charge, as many copies of each preliminary
prospectus as
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such International Manager reasonably requested, and the Company hereby
consents to the use of such copies for purposes permitted by the 1933 Act.
The Company will furnish to each International Manager, without charge,
during the period when the International Prospectus is required to be
delivered under the 1933 Act or the 1934 Act, such number of copies of the
International Prospectus (as amended or supplemented) as such
International Manager may reasonably request. The International Prospectus
and any amendments or supplements thereto furnished to the International
Managers will be identical to the electronically transmitted copies
thereof filed with the Commission pursuant to EDGAR, except to the extent
permitted by Regulation S-T.
(e) Continued Compliance with Securities Laws. The Company will
comply with the 1933 Act and the 1933 Act Regulations and the 1934 Act and
the 1934 Act Regulations so as to permit the completion of the
distribution of the Securities as contemplated in this Agreement, the U.S.
Purchase Agreement and in the Prospectuses. If at any time when a
prospectus is required by the 1933 Act to be delivered in connection with
sales of the Securities, any event shall occur or condition shall exist as
a result of which it is necessary, in the opinion of counsel for the
International Managers or for the Company, to amend the Registration
Statement or amend or supplement any Prospectus in order that the
Prospectuses will not include any untrue statements of a material fact or
omit to state a material fact necessary in order to make the statements
therein not misleading in the light of the circumstances existing at the
time it is delivered to a purchaser, or if it shall be necessary, in the
opinion of such counsel, at any such time to amend the Registration
Statement or amend or supplement any Prospectus in order to comply with
the requirements of the 1933 Act or the 1933 Act Regulations, the Company
will promptly prepare and file with the Commission, subject to Section
3(b), such amendment or supplement as may be necessary to correct such
statement or omission or to make the Registration Statement or the
Prospectuses comply with such requirements, and the Company will furnish
to the International Managers such number of copies of such amendment or
supplement as the International Managers may reasonably request.
(f) Blue Sky Qualifications. The Company will endeavor, in
cooperation with the International Managers, to qualify the Securities for
offering and sale under the applicable securities laws of such states and
other jurisdictions (domestic or foreign) as the Global Coordinator may
designate and to maintain such qualifications in effect for a period of
not less than one year from the later of the effective date of the
Registration Statement and any Rule 462(b) Registration Statement;
provided, however, that the Company shall not be obligated to file any
general consent to service of process or to qualify as a foreign
corporation or as a dealer in securities in any jurisdiction in which it
is not so qualified or to subject itself to taxation in respect of doing
business in any jurisdiction in which it is not otherwise so subject. In
each jurisdiction in which the Securities have been so qualified, the
Company will file such statements and reports as may be required by the
laws of such jurisdiction to continue such qualification in effect for a
period of not less than one year from the effective date of the
Registration Statement and any Rule 462(b) Registration Statement.
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(g) Rule 158. The Company will timely file such reports pursuant to
the 1934 Act as are necessary in order to make generally available to its
securityholders as soon as practicable an earnings statement for the
purposes of, and to provide the benefits contemplated by, the last
paragraph of Section 11(a) of the 1933 Act.
(h) Use of Proceeds. The Company will use the net proceeds received
by it from the sale of the Securities in the manner specified in the
Prospectuses under "Use of Proceeds."
(i) Listing. The Company will use its best efforts to effect the
listing of the Securities on the New York Stock Exchange.
(j) Restriction on Sale of Securities. During a period of 60 days
from the date of the Prospectuses, the Company will not, without the prior
written consent of the Global Coordinator, (i) directly or indirectly,
offer, pledge, sell, contract to sell, sell any option or contract to
purchase, purchase any option or contract to sell, grant any option, right
or warrant to purchase or otherwise transfer or dispose of any shares of
Common Stock or any securities convertible into or exercisable or
exchangeable for Common Stock or file any registration statement under the
1933 Act with respect to any of the foregoing or (ii) enter into any swap
or any other agreement or any transaction that transfers, in whole or in
part, directly or indirectly, the economic consequence of ownership of the
Common Stock, whether any such swap or transaction described in clause (i)
or (ii) above is to be settled by delivery of Common Stock or such other
securities, in cash or otherwise. The foregoing sentence shall not apply
to (A) the Securities to be sold hereunder or under the U.S. Purchase
Agreement, (B) any shares of Common Stock issued by the Company upon the
exercise of an option or warrant or the conversion of a security
outstanding on the date hereof and referred to in the Prospectuses, (C)
any shares of Common Stock issued or options to purchase Common Stock
granted pursuant to employee benefit plans of the Company pursuant to the
terms thereof as in effect on the date hereof and (D) the filing of a
registration statement under the 1933 Act for the registration of
warrants, or shares of Common Stock issued or issuable upon exercise of
such warrants, pursuant to the Kendall Registration Rights Agreement
(estimated to be up to 130,600 shares).
(k) Reporting Requirements. The Company, during the period when the
Prospectuses are required to be delivered under the 1933 Act or the 1934
Act, will file all documents required to be filed with the Commission
pursuant to the 1934 Act within the time periods required by the 1934 Act
and the 1934 Act Regulations.
SECTION 4. Payment of Expenses. (a) Expenses. The Company agrees to pay
all expenses incident to the performance of its obligations under this
Agreement, including (i) the preparation, printing and filing of the
Registration Statement (including financial statements and exhibits) as
originally filed and of each amendment thereto, (ii) the preparation, printing
and delivery to the Underwriters of this Agreement, any Agreement among
Underwriters, any Inter-syndicate Agreement and such other documents as may be
required in connection with the
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offering, purchase, sale, issuance or delivery of the Securities, (iii) the
preparation, issuance and delivery of the certificates for the Securities to the
Underwriters, including any stock or other transfer taxes and any stamp or other
duties payable upon the sale, issuance or delivery of the Securities to the
Underwriters and the transfer of the Securities between the U.S. Underwriters
and the International Managers, (iv) the fees and disbursements of the Company's
counsel, accountants and other advisors, (v) the qualification of the Securities
under securities laws in accordance with the provisions of Section 3(f) hereof,
including filing fees and the reasonable fees and disbursements of counsel for
the Underwriters in connection therewith and in connection with the preparation
of the Blue Sky Survey and any supplement thereto, (vi) the printing and
delivery to the Underwriters of copies of each preliminary prospectus, any Term
Sheets and of the Prospectuses and any amendments or supplements thereto, (vii)
the preparation, printing and delivery to the Underwriters of copies of the Blue
Sky Survey and any supplement thereto, (viii) the fees and expenses of any
transfer agent or registrar for the Securities and (ix) the fees and expenses
incurred in connection with the listing of the Securities on the New York Stock
Exchange.
(b) Termination of Agreement. If this Agreement is terminated by the Lead
Managers in accordance with the provisions of Section 5 or Section 9(a)(i)
hereof, the Company shall reimburse the International Managers for all of their
out-of-pocket expenses, including the reasonable fees and disbursements of
Fried, Frank, Harris, Shriver & Jacobson as counsel for the International
Managers.
SECTION 5. Conditions of International Managers' Obligations. The
obligations of the several International Managers hereunder are subject to the
accuracy of the representations and warranties of the Company contained in
Section 1 hereof or in certificates of any officer of the Company or any
subsidiary of the Company delivered pursuant to the provisions hereof, to the
performance by the Company of its covenants and other obligations hereunder, and
to the following further conditions:
(a) Effectiveness of Registration Statement. The Registration
Statement, including any Rule 462(b) Registration Statement, has become
effective and at Closing Time no stop order suspending the effectiveness
of the Registration Statement shall have been issued under the 1933 Act or
proceedings therefor initiated or threatened by the Commission, and any
request on the part of the Commission for additional information shall
have been complied with to the reasonable satisfaction of counsel to the
International Managers. A prospectus containing the Rule 430A Information
shall have been filed with the Commission in accordance with Rule 424(b)
(or a post-effective amendment providing such information shall have been
filed and declared effective in accordance with the requirements of Rule
430A) or, if the Company has elected to rely upon Rule 434, a Term Sheet
shall have been filed with the Commission in accordance with Rule 424(b).
(b) Opinion of General Counsel of Company. At Closing Time, the Lead
Managers shall have received the favorable opinion, dated as of Closing
Time, of M. Brian Moroze, Esq., General Counsel of the Company, in form
and substance satisfactory
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to counsel for the International Managers, to the effect set forth in
Exhibit A-1 hereto and to such further effect as counsel to the
International Managers may reasonably request.
(c) Opinion of Counsel for Company. At Closing Time, the Lead
Managers shall have received the favorable opinion, dated as of Closing
Time, of Kramer, Levin, Naftalis & Frankel, counsel for the Company, in
form and substance satisfactory to counsel for the International Managers,
to the effect set forth in Exhibit A-2 hereto and to such further effect
as counsel to the International Managers may reasonably request. In giving
such opinion, such counsel may rely on the opinion of the Company's
General Counsel as to all matters governed by the law of the Commonwealth
of Massachusetts.
(d) Opinion of Counsel for International Managers. At Closing Time,
the Lead Managers shall have received the favorable opinion, dated as of
Closing Time, of Fried, Frank, Harris, Shriver & Jacobson, counsel for the
International Managers, together with signed or reproduced copies of such
letter for each of the other International Managers with respect to the
matters set forth in clauses (i), (ii), (v), (vi) (solely as to preemptive
or other similar rights arising by operation of law or under the charter
or by-laws of the Company), (viii), (x), (xii) (solely as to the
information in the Prospectus under "Description of Capital Stock--Common
Stock"), the penultimate paragraph of Exhibit A-1 hereto and in clauses
(i) and (ii) of Exhibit A-2 hereto. In giving such opinion such counsel
may rely, as to all matters governed by the laws of jurisdictions other
than the law of the State of New York, the federal law of the United
States and the General Corporation Law of the State of Delaware, upon the
opinions of counsel satisfactory to the International Managers. Such
counsel may also state that, insofar as such opinion involves factual
matters, they have relied, to the extent they deem proper, upon
certificates of officers of the Company and its subsidiaries and
certificates of public officials.
(e) Officer's Certificate. At Closing Time, there shall not have
been, since the date hereof or since the respective dates as of which
information is given in the Prospectuses, any material adverse change in
the condition, financial or otherwise, earnings, business affairs or
business prospects of the Company and its subsidiaries considered as one
enterprise, whether or not arising in the ordinary course of business, and
the Lead Managers shall have received a certificate of the President or a
Vice President of the Company and of the chief financial or chief
accounting officer of the Company, dated as of Closing Time, to the effect
that (i) there has been no such material adverse change, (ii) the
representations and warranties in Section 1(a) hereof are true and correct
with the same force and effect as though expressly made at and as of
Closing Time, (iii) the Company has complied with all agreements and
satisfied all conditions on its part to be performed or satisfied at or
prior to Closing Time, and (iv) no stop order suspending the effectiveness
of the Registration Statement has been issued and no proceedings for that
purpose have been instituted or are pending or are contemplated by the
Commission.
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(f) Accountant's Comfort Letter. At the time of the execution of
this Agreement, the Lead Managers shall have received from Coopers &
Lybrand L.L.P. a letter dated such date, in form and substance
satisfactory to the Lead Managers, together with signed or reproduced
copies of such letter for each of the other International Managers
containing statements and information of the type ordinarily included in
accountants' "comfort letters" to underwriters with respect to the
financial statements and certain financial information contained in the
Registration Statement and the Prospectuses.
(g) Bring-down Comfort Letter. At Closing Time, the Lead Managers
shall have received from Coopers & Lybrand L.L.P. a letter, dated as of
Closing Time, to the effect that they reaffirm the statements made in the
letter furnished pursuant to subsection (f) of this Section, except that
the specified date referred to shall be a date not more than three
business days prior to Closing Time.
(h) Approval of Listing. At Closing Time, the Securities shall have
been approved for listing on the New York Stock Exchange, subject only to
official notice of issuance.
(i) Lock-up Agreements. At the date of this Agreement, the Lead
Managers shall have received an agreement substantially in the form of
Exhibit B hereto signed by the persons listed on Schedule C hereto.
(j) Indemnification Agreement. The Company shall have executed the
indemnification agreement with the Underwriters dated as of even date
herewith and such agreement shall be in full force and effect and
represent a binding and enforceable agreement of the Company.
(k) Certificate of Chief Financial Officer. At the Closing Time, you
shall have received a certificate of the Chief Financial Officer of the
Company as to certain agreed upon accounting matters.
(l) Purchase of Initial U.S. Securities. Contemporaneously with the
purchase by the International Managers of the Initial International
Securities under this Agreement, the U.S. Underwriters shall have
purchased the Initial U.S. Securities under the U.S. Purchase Agreement.
(m) Conditions to Purchase of International Option Securities. In
the event that the International Managers exercise their option provided
in Section 2(b) hereof to purchase all or any portion of the International
Option Securities, the representations and warranties of the Company
contained herein and the statements in any certificates furnished by the
Company or any subsidiary of the Company hereunder shall be true and
correct as of each Date of Delivery and, at the relevant Date of Delivery,
the Lead Managers shall have received:
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(i) Officers' Certificate. A certificate, dated such Date of
Delivery, of the President or a Vice President of the Company and of
the chief financial or chief accounting officer of the Company
confirming that the certificate delivered at the Closing Time
pursuant to Section 5(e) hereof remains true and correct as of such
Date of Delivery.
(ii) Opinion of General Counsel of Company. The favorable opinion of
M. Brian Moroze, Esq., General Counsel of the Company, in form and
substance satisfactory to counsel for the International Managers,
dated such Date of Delivery, relating to the International Option
Securities to be purchased on such Date of Delivery and otherwise to
the same effect as the opinion required by Section 5(b) hereof.
(iii) Opinion of Counsel for Company. The favorable opinion of
Kramer, Levin, Naftalis & Frankel, counsel for the Company, in form
and substance satisfactory to counsel for the International
Managers, dated such Date of Delivery, relating to the International
Option Securities to be purchased on such Date of Delivery and
otherwise to the same effect as the opinion required by Section 5(c)
hereof.
(iv) Opinion of Counsel for International Managers. The favorable
opinion of Fried, Frank, Harris, Shriver & Jacobson, counsel for the
International Managers, dated such Date of Delivery, relating to the
International Option Securities to be purchased on such Date of
Delivery and otherwise to the same effect as the opinion required by
Section 5(d) hereof.
(v) Bring-down Comfort Letter. A letter from Coopers & Lybrand
L.L.P., in form and substance satisfactory to the Lead Managers and
dated such Date of Delivery, substantially in the same form and
substance as the letter furnished to the Lead Managers pursuant to
Section 5(g) hereof, except that the "specified date" in the letter
furnished pursuant to this paragraph shall be a date not more than
five days prior to such Date of Delivery.
(n) Additional Documents. At Closing Time and at each Date of
Delivery counsel for the International Managers shall have been furnished
with such documents and opinions as they may reasonably require for the
purpose of enabling them to pass upon the issuance and sale of the
Securities as herein contemplated, or in order to evidence the accuracy of
any of the representations or warranties, or the fulfillment of any of the
conditions, herein contained; and all proceedings taken by the Company in
connection with the issuance and sale of the Securities as herein
contemplated shall be satisfactory in form and substance to the Lead
Managers and counsel for the International Managers.
(o) Termination of Agreement. If any condition specified in this
Section shall not have been fulfilled when and as required to be
fulfilled, this Agreement, or, in the case of any condition to the
purchase of International Option Securities on a Date of
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Delivery which is after the Closing Time, the obligations of the several
International Managers to purchase the relevant Option Securities may be
terminated by the Lead Managers by notice to the Company at any time at or
prior to Closing Time or such Date of Delivery, as the case may be, and
such termination shall be without liability of any party to any other
party except as provided in Section 4 and except that Sections 1, 6, 7 and
8 shall survive any such termination and remain in full force and effect.
SECTION 6. Indemnification.
(a) Indemnification of International Managers. The Company agrees to
indemnify and hold harmless each International Manager and each person, if any,
who controls any International Manager within the meaning of Section 15 of the
1933 Act or Section 20 of the 1934 Act as follows:
(i) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, arising out of any untrue statement or alleged
untrue statement of a material fact contained in the Registration
Statement (or any amendment thereto), including the Rule 430A Information
and the Rule 434 Information, if applicable, or the omission or alleged
omission therefrom of a material fact required to be stated therein or
necessary to make the statements therein not misleading or arising out of
any untrue statement or alleged untrue statement of a material fact
included in any preliminary prospectus or the Prospectuses (or any
amendment or supplement thereto), or the omission or alleged omission
therefrom of a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading;
(ii) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, to the extent of the aggregate amount paid in
settlement of any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or of any claim
whatsoever based upon any such untrue statement or omission, or any such
alleged untrue statement or omission; provided that (subject to Section
6(d) below) any such settlement is effected with the written consent of
the Company; and
(iii) against any and all expense whatsoever, as incurred (including
the fees and disbursements of counsel chosen by Merrill Lynch), reasonably
incurred in investigating, preparing or defending against any litigation,
or any investigation or proceeding by any governmental agency or body,
commenced or threatened, or any claim whatsoever based upon any such
untrue statement or omission, or any such alleged untrue statement or
omission, to the extent that any such expense is not paid under (i) or
(ii) above;
provided, however, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Company by any
International Manager through the Lead Managers expressly for use in the
Registration Statement (or any amendment thereto), including the Rule 430A
Information and the Rule 434 Information, if applicable, or any preliminary
prospectus or the
18
<PAGE>
International Prospectus (or any amendment or supplement thereto); provided,
further, that the Company will not be liable to any U.S. Underwriter or any
person controlling such U.S. Underwriter with respect to any such untrue
statement or alleged untrue statement or omission or alleged omission made in
any preliminary prospectus to the extent that the Company shall sustain the
burden of proving that any such loss, liability, claim, damage or expense
resulted from the fact that such U.S. Underwriter, in contravention of a
requirement of this Agreement or applicable law, sold securities to a person to
whom such U.S. Underwriter failed to send or give, at or prior to the written
confirmation of the sale of such Securities, a copy of the U.S. Prospectus (as
amended or supplemented) if (i) the Company has previously furnished copies
thereof (sufficiently in advance of the Closing Date to allow for distribution
of the U.S. Prospectus in a timely manner) to the U.S. Underwriter and the loss,
liability, claim, damage or expense of such U.S. Underwriter resulted from an
untrue statement or omission or alleged untrue statement or omission of a
material fact contained in or omitted from such preliminary prospectus which was
corrected in the U.S. Prospectus and (ii) such failure to give or send such U.S.
Prospectus by the Closing Date to the party or parties asserting such loss,
liability, claim or damage or expense would have constituted the sole defense to
the claim asserted by such person.
(b) Indemnification of Company, Directors and Officers. Each International
Manager severally agrees to indemnify and hold harmless the Company, its
directors, each of its officers who signed the Registration Statement, and each
person, if any, who controls the Company within the meaning of Section 15 of the
1933 Act or Section 20 of the 1934 Act against any and all loss, liability,
claim, damage and expense described in the indemnity contained in subsection (a)
of this Section, as incurred, but only with respect to untrue statements or
omissions, or alleged untrue statements or omissions, made in the Registration
Statement (or any amendment thereto), including the Rule 430A Information and
the Rule 434 Information, if applicable, or any preliminary international
prospectus or the International Prospectus (or any amendment or supplement
thereto) in reliance upon and in conformity with written information furnished
to the Company by such International Manager through the Lead Managers expressly
for use in the Registration Statement (or any amendment thereto) or such
preliminary prospectus or the International Prospectus (or any amendment or
supplement thereto).
(c) Actions against Parties; Notification. Each indemnified party shall
give notice as promptly as reasonably practicable to each indemnifying party of
any action commenced against it in respect of which indemnity may be sought
hereunder, but failure to so notify an indemnifying party shall not relieve such
indemnifying party from any liability hereunder to the extent it is not
materially prejudiced as a result thereof and in any event shall not relieve it
from any liability which it may have otherwise than on account of this indemnity
agreement. In the case of parties indemnified pursuant to Section 6(a) above,
counsel to the indemnified parties shall be selected by Merrill Lynch, and, in
the case of parties indemnified pursuant to Section 6(b) above, counsel to the
indemnified parties shall be selected by the Company. An indemnifying party may
participate at its own expense in the defense of any such action; provided,
however, that counsel to the indemnifying party shall not (except with the
consent of the indemnified party) also be counsel to the indemnified party. In
no event shall the indemnifying parties be liable for fees and expenses of more
than one counsel (in addition to any
19
<PAGE>
local counsel) separate from their own counsel for all indemnified parties in
connection with any one action or separate but similar or related actions in the
same jurisdiction arising out of the same general allegations or circumstances.
No indemnifying party shall, without the prior written consent of the
indemnified parties, settle or compromise or consent to the entry of any
judgment with respect to any litigation, or any investigation or proceeding by
any governmental agency or body, commenced or threatened, or any claim
whatsoever in respect of which indemnification or contribution could be sought
under this Section 6 or Section 7 hereof (whether or not the indemnified parties
are actual or potential parties thereto), unless such settlement, compromise or
consent (i) includes an unconditional release of each indemnified party from all
liability arising out of such litigation, investigation, proceeding or claim and
(ii) does not include a statement as to or an admission of fault, culpability or
a failure to act by or on behalf of any indemnified party.
(d) Settlement without Consent if Failure to Reimburse. If at any time an
indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel, such indemnifying party
agrees that it shall be liable for any settlement of the nature contemplated by
Section 6(a)(ii) effected without its written consent if (i) such settlement is
entered into more than 65 days after receipt by such indemnifying party of the
aforesaid request, (ii) such indemnifying party shall have received notice of
the terms of such settlement at least 45 days prior to such settlement being
entered into and (iii) such indemnifying party shall not have reimbursed such
indemnified party in accordance with such request prior to the date of such
settlement. Notwithstanding the immediately preceding sentence, if at any time
an indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel, an indemnifying party shall
not be liable for any settlement of the nature contemplated by Section 6(a)(ii)
or 6(b)(ii) effected without its consent if such indemnifying party (i)
reimburses such indemnified party in accordance with such request to the extent
it considers such request to be reasonable and (ii) provides written notice to
the indemnified party setting forth in reasonable detail its basis for disputing
the unpaid balance, in each case prior to the date of such settlement.
SECTION 7. Contribution. If the indemnification provided for in Section 6
hereof is for any reason unavailable to or insufficient to hold harmless an
indemnified party in respect of any losses, liabilities, claims, damages or
expenses referred to therein, then each indemnifying party shall contribute to
the aggregate amount of such losses, liabilities, claims, damages and expenses
incurred by such indemnified party, as incurred, (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company on the one
hand and the International Managers on the other hand from the offering of the
Securities pursuant to this Agreement or (ii) if the allocation provided by
clause (i) is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause (i)
above but also the relative fault of the Company on the one hand and of the
International Managers on the other hand in connection with the statements or
omissions which resulted in such losses, liabilities, claims, damages or
expenses, as well as any other relevant equitable considerations.
The relative benefits received by the Company on the one hand and the
International Managers on the other hand in connection with the offering of the
International Securities
20
<PAGE>
pursuant to this Agreement shall be deemed to be in the same respective
proportions as the total net proceeds from the offering of the International
Securities pursuant to this Agreement (before deducting expenses) received by
the Company and the total underwriting discount received by the International
Managers, in each case as set forth on the cover of the International
Prospectus, or, if Rule 434 is used, the corresponding location on the Term
Sheet, bear to the aggregate initial public offering price of the International
Securities as set forth on such cover.
The relative fault of the Company on the one hand and the International
Managers on the other hand shall be determined by reference to, among other
things, whether any such untrue or alleged untrue statement of a material fact
or omission or alleged omission to state a material fact relates to information
supplied by the Company or by the International Managers and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission.
The Company and the International Managers agree that it would not be just
and equitable if contribution pursuant to this Section 7 were determined by pro
rata allocation (even if the International Managers were treated as one entity
for such purpose) or by any other method of allocation which does not take
account of the equitable considerations referred to above in this Section 7. The
aggregate amount of losses, liabilities, claims, damages and expenses incurred
by an indemnified party and referred to above in this Section 7 shall be deemed
to include any legal or other expenses reasonably incurred by such indemnified
party in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue or alleged untrue
statement or omission or alleged omission.
Notwithstanding the provisions of this Section 7, no International Manager
shall be required to contribute any amount in excess of the amount by which the
total price at which the International Securities underwritten by it and
distributed to the public were offered to the public exceeds the amount of any
damages which such International Managers has otherwise been required to pay by
reason of any such untrue or alleged untrue statement or omission or alleged
omission.
No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the 1933 Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 7, each person, if any, who controls an
International Manager within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act shall have the same rights to contribution as such
International Manager, and each director of the Company, each officer of the
Company who signed the Registration Statement, and each person, if any, who
controls the Company within the meaning of Section 15 of the 1933 Act or Section
20 of the 1934 Act shall have the same rights to contribution as the Company.
The International Managers' respective obligations to contribute pursuant to
this Section 7 are several in proportion to the number of Initial International
Securities set forth opposite their respective names in Schedule A hereto and
not joint.
21
<PAGE>
SECTION 8. Representations, Warranties and Agreements to Survive Delivery.
All representations, warranties and agreements contained in this Agreement or in
certificates of officers of the Company or any of its subsidiaries submitted
pursuant hereto, shall remain operative and in full force and effect, regardless
of any investigation made by or on behalf of any International Manager or
controlling person, or by or on behalf of the Company, and shall survive
delivery of the Securities to the International Managers.
SECTION 9. Termination of Agreement.
(a) Termination; General. The Lead Managers may terminate this Agreement,
by notice to the Company, at any time at or prior to Closing Time (i) if there
has been, since the time of execution of this Agreement or since the respective
dates as of which information is given in the International Prospectus, any
material adverse change in the condition, financial or otherwise, earnings,
business affairs or business prospects of the Company and its subsidiaries
considered as one enterprise, whether or not arising in the ordinary course of
business, or (ii) if there has occurred any material adverse change in the
financial markets in the United States or the international financial markets,
any outbreak of hostilities or escalation thereof or other calamity or crisis or
any change or development involving a prospective change in national or
international political, financial or economic conditions, in each case the
effect of which is such as to make it, in the judgment of the Lead Managers,
impracticable to market the Securities or to enforce contracts for the sale of
the Securities, or (iii) if trading in any securities of the Company has been
suspended or materially limited by the Commission or the New York Stock
Exchange, or if trading generally on the American Stock Exchange or the New York
Stock Exchange or in the Nasdaq National Market has been suspended or materially
limited, or minimum or maximum prices for trading have been fixed, or maximum
ranges for prices have been required, by any of said exchanges or by such system
or by order of the Commission, the National Association of Securities Dealers,
Inc. or any other governmental authority, or (iv) if a banking moratorium has
been declared by either Federal or New York authorities.
(b) Liabilities. If this Agreement is terminated pursuant to this Section,
such termination shall be without liability of any party to any other party
except as provided in Section 4 hereof, and provided further that Sections 1, 6,
7 and 8 shall survive such termination and remain in full force and effect.
SECTION 10. Default By One or More of the International Managers. If one
or more of the International Managers shall fail at Closing Time or a Date of
Delivery to purchase the Securities which it or they are obligated to purchase
under this Agreement (the "Defaulted Securities"), the Lead Managers shall have
the right, but not the obligation, within 24 hours thereafter, to make
arrangements for one or more of the non-defaulting International Managers, or
any other underwriters, to purchase all, but not less than all, of the Defaulted
Securities in such amounts as may be agreed upon and upon the terms herein set
forth; if, however, the Lead Managers shall not have completed such arrangements
within such 24-hour period, then this Agreement shall terminate without
liability on the part of any non-defaulting International Manager.
22
<PAGE>
No action taken pursuant to this Section shall relieve any defaulting
International Manager from liability in respect of its default.
In the event of any such default which does not result in a termination of
this Agreement, either the Lead Managers or the Company shall have the right to
postpone the Closing Time or a Date of Delivery for a period not exceeding seven
days in order to effect any required changes in the Registration Statement or
the Prospectuses or in any other documents or arrangements.
SECTION 11. Notices. All notices and other communications hereunder shall
be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the
International Managers shall be directed to the Lead Managers at North Tower,
World Financial Center, New York, New York 10281-1201, attention of Wood
Steinberg, Esq.; and notices to the Company shall be directed to it at One Tyco
Park, Exeter, New Hampshire 03833, attention of M. Brian Moroze, Esq.
SECTION 12. Parties. This Agreement shall each inure to the benefit of and
be binding upon the International Managers and the Company and their respective
successors. Nothing expressed or mentioned in this Agreement is intended or
shall be construed to give any person, firm or corporation, other than the
International Managers and the Company and their respective successors and the
controlling persons and officers and directors referred to in Sections 6 and 7
and their heirs and legal representatives, any legal or equitable right, remedy
or claim under or in respect of this Agreement or any provision herein
contained. This Agreement and all conditions and provisions hereof are intended
to be for the sole and exclusive benefit of the International Managers and the
Company and their respective successors, and said controlling persons and
officers and directors and their heirs and legal representatives, and for the
benefit of no other person, firm or corporation. No purchaser of Securities from
any International Manager shall be deemed to be a successor by reason merely of
such purchase.
SECTION 13. GOVERNING LAW AND TIME. THIS AGREEMENT SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. SPECIFIED
TIMES OF DAY REFER TO NEW YORK CITY TIME.
SECTION 14. Effect of Headings. The Article and Section headings herein
and the Table of Contents are for convenience only and shall not affect the
construction hereof.
23
<PAGE>
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Company a counterpart hereof, whereupon
this instrument, along with all counterparts, will become a binding agreement
between the International Managers and the Company in accordance with its terms.
Very truly yours,
TYCO INTERNATIONAL LTD.
By /s/ Barbara S. Miller
-----------------------------
Name:
Title:
CONFIRMED AND ACCEPTED,
as of the date first above written:
MERRILL LYNCH INTERNATIONAL
CREDIT SUISSE FIRST BOSTON (EUROPE) LIMITED
LEHMAN BROTHERS INTERNATIONAL (EUROPE)
J.P. MORGAN SECURITIES LTD.
By: MERRILL LYNCH INTERNATIONAL
By _____________________________
Authorized Signatory
For themselves and as Lead Managers of the
other International Managers named in Schedule A hereto.
<PAGE>
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Company a counterpart hereof, whereupon
this instrument, along with all counterparts, will become a binding agreement
between the International Managers and the Company in accordance with its terms.
Very truly yours,
TYCO INTERNATIONAL LTD.
By _______________________________
Name:
Title:
CONFIRMED AND ACCEPTED,
as of the date first above written:
MERRILL LYNCH INTERNATIONAL
CREDIT SUISSE FIRST BOSTON (EUROPE) LIMITED
LEHMAN BROTHERS INTERNATIONAL (EUROPE)
J.P. MORGAN SECURITIES LTD.
By: MERRILL LYNCH INTERNATIONAL
By /s/ ILLEGIBLE
-----------------------------
Authorized Signatory
For themselves and as Lead Managers of the
other International Managers named in Schedule A hereto.
24
<PAGE>
SCHEDULE A
Number of
Initial International
Name of International Manager Securities
----------------------------- ----------
Merrill Lynch International................................ 500,000
Credit Suisse First Boston (Europe) Limited................ 500,000
Lehman Brothers International (Europe)..................... 500,000
J.P. Morgan Securities Ltd................................. 500,000
Total...................................................... 2,000,000
=========
A-1
<PAGE>
SCHEDULE B
TYCO INTERNATIONAL LTD.
2,000,000 shares of Common Stock
(Par Value $.50 Per Share)
1. The initial public offering price per share for the Securities,
determined as provided in said Section 2, shall be $57.75.
2. The purchase price per share for the International Securities to be
paid by the several International Managers shall be $56.13, being an amount
equal to the initial public offering price set forth above less $1.62 per share;
provided that the purchase price per share for any International Option
Securities purchased upon the exercise of the over-allotment option described in
Section 2(b) shall be reduced by an amount per share equal to any dividends or
distributions declared by the Company and payable on the Initial International
Securities but not payable on the International Option Securities (for purposes
of this agreement, dividends declared by the Company subsequent to the Closing
Time that are payable on shares of Common Stock held as of a record date that is
subsequent to a Date of Delivery are payable on the U.S. Option Securities).
B-1
<PAGE>
SCHEDULE C
List of persons and entities
subject to lock-up
L. Dennis Kozlowski
Jerry R. Boggess
David P. Brownell
Neil R. Garvey
John J. Guarnieri
Irving Gutin
J. Brad McGee
Robert P. Mead
Richard J. Meelia
Barbara S. Miller
Mark H. Swartz
C-1
<PAGE>
Exhibit A-1
FORM OF OPINION OF COMPANY'S GENERAL COUNSEL
TO BE DELIVERED PURSUANT TO
SECTION 5(b)
(i) The Company is a corporation validly organized and validly existing
and in good standing under the laws of the Commonwealth of Massachusetts.
(ii) The Company has the requisite power and authority (corporate and
other) to own, lease and operate its properties and to conduct its business as
described in the Prospectuses and to enter into and perform its obligations
under the International Purchase Agreement and the U.S. Purchase Agreement.
(iii) The Company is duly qualified as a foreign corporation to transact
business and is in good standing in each jurisdiction in which such
qualification is required, whether by reason of the ownership or leasing of
property or the conduct of business, except where the failure to be so qualified
or in good standing would not result in a Material Adverse Effect.
(iv) The authorized, issued and outstanding capital stock of the Company
is as set forth in the Prospectuses under the caption "Capitalization" (except
for subsequent issuances, if any, pursuant to the International Purchase
Agreement and the U.S. Purchase Agreement or pursuant to reservations,
agreements or employee benefit plans referred to in the Prospectuses or pursuant
to the exercise of convertible securities or options referred to in the
Prospectuses); the shares of issued and outstanding capital stock have been duly
authorized and validly issued and are fully paid and non-assessable; and none of
the outstanding shares of capital stock of the Company was issued in violation
of the preemptive or other similar rights of any securityholder of the Company.
(v) The Securities to be purchased by the International Managers and the
U.S. Underwriters from the Company have been duly authorized for issuance and
sale to the Underwriters pursuant to the International Purchase Agreement and
the U.S. Purchase Agreement, respectively, and, when issued and delivered by the
Company pursuant to the International Purchase Agreement and the U.S. Purchase
Agreement, respectively, against payment of the consideration set forth in the
International Purchase Agreement and the U.S. Purchase Agreement, will be
validly issued and fully paid and non-assessable.
(vi) The issuance of the Securities is not subject to the preemptive or
other similar rights of any securityholder of the Company.
(vii) Each Significant Subsidiary is a corporation validly organized and
existing as a corporation under the laws of its jurisdiction of incorporation,
has corporate power
A-1-1
<PAGE>
and authority to own its properties and to conduct its business as described in
the Prospectuses and is duly qualified as a foreign corporation to transact
business and is in good standing in each jurisdiction in which such
qualification is required, whether by reason of the ownership or leasing of
property or the conduct of business, except where the failure so to qualify or
to be in good standing would not result in a Material Adverse Effect; except as
otherwise disclosed in the Registration Statement, all of the issued and
outstanding capital stock of each Subsidiary has been duly authorized and
validly issued, is fully paid and non-assessable and, to the best of my
knowledge (except for non-material liens that have arisen in the ordinary course
of business and in the case of foreign subsidiaries, for directors qualifying
shares) is owned by the Company, directly or indirectly, free and clear of all
liens, encumbrances, security interests and claims.
(viii) The International Purchase Agreement and the U.S. Purchase
Agreement have been duly authorized, executed and delivered by the Company.
(ix) The documents incorporated by reference in the Prospectuses (other
than the financial statements, the notes thereto and supporting schedules and
other financial or accounting data included therein or omitted therefrom, as to
which I express no opinion), when they were filed with the Commission complied
as to form in all material respects with the requirements of the 1934 Act and
the rules and regulations of the Commission thereunder.
(x) The form of certificate used to evidence the Common Stock complies in
all material respects with all applicable statutory requirements, with any
applicable requirements of the charter and by-laws of the Company, and with the
requirements of the New York Stock Exchange.
(xi) To the best of my knowledge, except as disclosed in the Prospectuses,
there is not pending or threatened any action, suit, proceeding, inquiry or
investigation, to which the Company or any subsidiary is a party, or to which
the property of the Company or any subsidiary is subject, before or brought by
any court or governmental agency or body, domestic or foreign, which could
reasonably be expected to result in a Material Adverse Effect, or which could
reasonably be expected to materially and adversely affect the consummation of
the transactions contemplated in the International Purchase Agreement and U.S.
Purchase Agreement or the performance by the Company of its obligations
thereunder.
(xii) The information in the Prospectuses under "Description of Common
Stock", and in "Legal Proceedings" incorporated by reference in the Company's
Annual Report on Form 10-K for the fiscal year ended June 30, 1996 and in the
Registration Statement under Item 15, insofar as such information constitutes a
summary of the legal matters, documents or proceedings referred to therein,
fairly presents the information called for with respect to such legal matters,
documents or proceedings.
A-1-2
<PAGE>
(xiii) To the best of my knowledge, there are no franchises, contracts,
indentures, mortgages, loan agreements, notes, leases or other instruments
required to be described or referred to in the Registration Statement or to be
filed as exhibits thereto other than those described or referred to therein or
filed or incorporated by reference as exhibits thereto.
(xiv) Neither the Company nor any of its Subsidiaries is, or, based upon
presently existing circumstances with the giving of notice or lapse of time or
both would be, in violation of or in default under, their respective restated
articles of organization, certificate of incorporation or other similar charter
document or by-laws or any contract, indenture, mortgage, deed of trust, loan
agreement, note, lease or other agreement or instrument known to such counsel to
which the Company or any of its Subsidiaries is party or by which it or any of
them or any of their respective properties is bound, except for violations and
defaults which would not result in a Material Adverse Effect.
(xv) No filing with, or authorization, approval, consent, license, order,
registration, qualification or decree of, any court or governmental authority or
agency, domestic or foreign (other than under the 1933 Act and the 1933 Act
Regulations, which have been obtained, or as may be required under the
securities or blue sky laws of the various states, as to which I need express no
opinion) is necessary or required in connection with the due authorization,
execution and delivery of the International Purchase Agreement and the U.S.
Purchase Agreement or for the offering, issuance, sale or delivery of the
Securities.
(xvi) To the best of such counsel's knowledge, no holders of the Company's
securities have rights to the registration of shares of Common Stock or other
securities as a result of the filing of the Registration Statement by the
Company or the offering contemplated hereby, except pursuant to the Kendall
Registration Rights Agreement.
(xvii) The execution, delivery and performance of the International
Purchase Agreement and the U.S. Purchase Agreement and the consummation of the
transactions contemplated in the U.S. Purchase Agreement, the International
Purchase Agreement and in the Registration Statement (including the issuance and
sale of the Securities, and the use of the proceeds from the sale of the
Securities as described in the Prospectuses under the caption "Use Of Proceeds")
and compliance by the Company with its obligations under the International
Purchase Agreement and the U.S. Purchase Agreement do not and will not, whether
with or without the giving of notice or lapse of time or both, conflict with or
constitute a breach of, or default or Repayment Event (as defined in Section
1(a)(xi) of the Purchase Agreements) under or result in the creation or
imposition of any lien, charge or encumbrance upon any property or assets of the
Company or any subsidiary pursuant to any contract, indenture, mortgage, deed of
trust, loan or credit agreement, note, lease or any other agreement or
instrument, known to me, to which the Company or any subsidiary is a party or by
which it or any of them may be bound, or to which any of the property or assets
of the Company or any subsidiary is subject (except for such conflicts, breaches
or defaults or liens, charges or encumbrances that would not
A-1-3
<PAGE>
have a Material Adverse Effect), nor will such action result in any violation of
the provisions of the charter or by-laws of the Company or any subsidiary, or
any applicable law, statute, rule, regulation, judgment, order, writ or decree,
known to me, of any government, government instrumentality or court, domestic or
foreign, having jurisdiction over the Company or any subsidiary or any of their
respective properties, assets or operations.
(xviii) The Company is not an "investment company" or an entity
"controlled" by an "investment company," as such terms are defined in the 1940
Act.
Although such counsel has not undertaken to determine independently the
accuracy and completeness of the statements contained in the Registration
Statement or the Prospectuses, such counsel has obtained information as a result
of discussions and meetings with officers and other representatives of the
Company and its Subsidiaries and discussions with representatives of and
independent public accountants of the Company, in connection with the
preparation of the Registration Statement and the Prospectuses, and the
examination of other information and documents requested by such counsel.
Although such counsel has not undertaken to determine independently, and
therefore, such counsel does not assume responsibility, explicitly or
implicitly, for the accuracy and completeness of the statements contained in the
Registration Statement or the Prospectuses, and such counsel cannot provide
assurance that the procedures described in the preceding sentence would
necessarily reveal matters of significance with respect to the following
comments, during the course of the above-described procedures, nothing has come
to such counsel's attention that has caused such counsel to believe that the
Registration Statement (including the Rule 430A Information, if applicable, and
any amendment thereto) or the Prospectuses (including, in each case, the
documents incorporated by reference therein), on the effective date thereof, or
on the date of the Agreement, contained an untrue statement of a material fact
or omitted to state a material fact required to be stated therein or necessary
to make the statements therein not misleading or that the Prospectuses or any
amendment or supplement thereto, on the date of such opinion, contains an untrue
statement of a material fact or omitted or omits to state a material fact
required to be stated therein or necessary to make the statement therein, in
light of the circumstances under which they were made, not misleading (it being
understood that such counsel need express no view with respect to financial
statements, the notes thereto and related schedules and other financial or
accounting data included in the Registration Statement or the Prospectuses).
In rendering such opinion, such counsel may rely as to matters of fact
(but not as to legal conclusions), to the extent they deem proper, on
certificates of responsible officers of the Company and public officials. Such
opinion shall not state that it is to be governed or qualified by, or that it is
otherwise subject to, any treatise, written policy or other document relating to
legal opinions, including, without limitation, the Legal Opinion Accord of the
ABA Section of Business Law (1991).
A-1-4
<PAGE>
Exhibit A-2
FORM OF OPINION OF COMPANY'S
COUNSEL TO BE DELIVERED PURSUANT
TO SECTION 5(c)
(i) The Registration Statement, including any Rule 462(b) Registration
Statement, has been declared effective under the 1933 Act; any required filing
of the Prospectuses pursuant to Rule 424(b) has been made in the manner and
within the time period required by Rule 424(b); and, to the best of our
knowledge, no stop order suspending the effectiveness of the Registration
Statement or any Rule 462(b) Registration Statement has been issued under the
1933 Act and no proceedings for that purpose have been instituted or are pending
or, to such counsel's knowledge, threatened by the Commission.
(ii) The Registration Statement, including any Rule 462(b) Registration
Statement, the Rule 430A Information and the Rule 434 Information, as
applicable, the Prospectuses, excluding the documents incorporated by reference
therein, and each amendment or supplement to the Registration Statement and the
Prospectuses, excluding the documents incorporated by reference therein, as of
their respective effective or issue dates (other than the financial statements,
the notes thereto and supporting schedules and other financial or accounting
data included therein or omitted therefrom, as to which we need express no
opinion) complied as to form in all material respects with the requirements of
the 1933 Act and the 1933 Act Regulations.
(iii) All of the Registrable Securities (other than Registrable Securities
held pursuant to Warrants) under the Kendall Registration Rights Agreement are
freely tradeable under the United States federal securities laws (including
pursuant to Rule 144 of the 1933 Act Regulations, without regard to the volume
limitations thereunder).
(iv) The statements made in the International Prospectus under "Certain
United States Federal Tax Consequences to Non-U.S. Holders of Common Stock," to
the extent that they are statements of United States federal laws or legal
conclusions thereunder, have been reviewed by such counsel and fairly present
the information disclosed therein in all material respects.
Although such counsel has not undertaken to determine independently the
accuracy and completeness of the statements contained in the Registration
Statement or the Prospectuses, such counsel has obtained information as a result
of discussions and meetings with officers and other representatives of the
Company and its Subsidiaries and discussions with representatives of and
independent public accountants of the Company, in connection with the
preparation of the Registration Statement and the Prospectuses, and the
examination of other information and documents requested by such counsel.
Although such counsel has not undertaken to determine independently, and
therefore, such counsel does not assume responsibility, explicitly or
implicitly, for the accuracy and completeness of the statements contained in the
Registration Statement or the
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Prospectuses, and such counsel cannot provide assurance that the procedures
described in the preceding sentence would necessarily reveal matters of
significance with respect to the following comments, during the course of the
above-described procedures, nothing has come to such counsel's attention that
has caused such counsel to believe that the Registration Statement (including
the Rule 430A Information, if applicable, and any amendment thereto) or the
Prospectuses (including, in each case, the documents incorporated by reference
therein), on the date or effective date thereof, or on the date of the
Agreement, contained an untrue statement of a material fact or omitted to state
a material fact required to be stated therein or necessary to make the
statements therein not misleading or that the Prospectuses or any amendment or
supplement thereto, on the date of such opinion, contains an untrue statement of
a material fact or omitted or omits to state a material fact required to be
stated therein or necessary to make the statement therein, in light of the
circumstances under which they were made, not misleading (it being understood
that such counsel need express no view with respect to financial statements, the
notes thereto and related schedules and other financial or accounting data
included in the Registration Statement or the Prospectuses).
In rendering such opinion, such counsel may rely as to matters of fact
(but not as to legal conclusions), to the extent they deem proper, on
certificates of responsible officers of the Company and public officials. Such
opinion shall not state that it is to be governed or qualified by, or that it is
otherwise subject to, any treatise, written policy or other document relating to
legal opinions, including, without limitation, the Legal Opinion Accord of the
ABA Section of Business Law (1991).
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Form of lock up from officers pursuant to Section 5(i)
Exhibit B
MERRILL LYNCH INTERNATIONAL
CREDIT SUISSE FIRST BOSTON (EUROPE) LIMITED
LEHMAN BROTHERS INTERNATIONAL (EUROPE)
J.P. MORGAN SECURITIES LTD.
as Lead Managers of the several
International Managers to be named in the
within-mentioned International Purchase Agreement
c/o Merrill Lynch International
Ropemaker Place
25 Ropemaker Street
London EC2Y 9LY
England
Re: Proposed Public Offering by Tyco International Ltd.
Dear Sirs:
The undersigned, a shareholder and an officer of Tyco International Ltd., a
Massachusetts corporation (the "Company"), understands that Merrill Lynch
International, Credit Suisse First Boston (Europe) Limited, Lehman Brothers
International (Europe) and J.P. Morgan Securities Ltd. propose to enter into an
International Purchase Agreement (the "International Purchase Agreement") with
the Company providing for the public offering of shares (the "Securities") of
the Company's common stock, par value $.50 per share (the "Common Stock"). In
recognition of the benefit that such an offering will confer upon the
undersigned as a shareholder and an officer of the Company, and for other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the undersigned agrees with each underwriter to be named in the
International Purchase Agreement that, during a period of 60 days from the date
of the International Purchase Agreement, the undersigned will not, without the
prior written consent of Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner &
Smith Incorporated, directly or indirectly, (i) offer, pledge, sell, contract to
sell, sell any option or contract to purchase, purchase any option or contract
to sell, grant any option, right or warrant for the sale of, or otherwise
dispose of or transfer any shares of the Company's Common Stock or any
securities convertible into or exchangeable or exercisable for Common Stock,
whether now owned or hereafter acquired by the undersigned or with respect to
which the undersigned has or hereafter acquires the power of disposition, or
file any registration statement under the Securities Act of 1933, as amended,
with respect to any of the foregoing or (ii) enter into any swap or any other
agreement or any transaction that transfers, in whole or in part, directly or
indirectly, the economic consequence of ownership of the Common Stock, whether
any such swap or transaction is to be settled by delivery of Common Stock or
other securities, in cash or otherwise. The foregoing sentence shall not apply
to (A) any transfer of shares of Common Stock to a charitable
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organization or trust, (B) any transfer of shares of Common Stock to the Company
in connection with the payment of taxes or repayment of any loan from the
Company pursuant to the Company's Restricted Stock Ownership Plan or (C) any
transfer to an immediate family member of the undersigned or to a trust for the
benefit thereof who agrees in writing to be bound by the terms of this letter as
if a signatory hereto.
Very truly yours,
Signature:
Print Name:
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