<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JANUARY 29, 1998
REGISTRATION NO. 33-59013
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
POST-EFFECTIVE AMENDMENT NO. 8 TO
FORM S-1 ON FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
WALTER INDUSTRIES, INC.
(Exact name of registrant as specified in charter)
DELAWARE
(State or other jurisdiction of
incorporation or organization)
6711
(Primary Standard Industrial
Classification Code Number)
13-3429953
(IRS Employer
Identification Number)
------------------------------
1500 NORTH DALE MABRY HIGHWAY
TAMPA, FL 33607
(813) 871-4811
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
------------------------------
EDWARD A. PORTER, ESQ.
VICE PRESIDENT, GENERAL COUNSEL AND SECRETARY
WALTER INDUSTRIES, INC.
1500 NORTH DALE MABRY HIGHWAY
TAMPA, FL 33607
(813) 871-4811
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
------------------------------
COPY OF ALL COMMUNICATIONS, INCLUDING SERVICE OF PROCESS, TO:
PETER J. GORDON, ESQ. MARK S. BERGMAN, ESQ.
SIMPSON THACHER & BARTLETT PAUL, WEISS, RIFKIND, WHARTON & GARRISON
425 LEXINGTON AVENUE 1285 AVENUE OF THE AMERICAS
NEW YORK, NY 10017-3909 NEW YORK, NY 10019-6064
------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
From time to time after the effective date of this Registration Statement.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. / /
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, please check the following box. /X/
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. / / ____________________
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / / ____________________
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. / /
------------------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
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<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
<TABLE>
<S> <C>
Registration fee............................................................... $139,072.62
Blue Sky fees and expenses..................................................... 1,500.00
Printing and engraving expenses................................................ 95,000.00
Legal fees and expenses........................................................ 360,000.00
Accounting fees and expenses................................................... 80,000.00
Miscellaneous.................................................................. 2,000.00
----------
Total...................................................................... $677,572.62
----------
----------
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 145 of the DGCL empowers a Delaware corporation to indemnify any
persons who are, or are threatened to be made, parties to any threatened,
pending or completed legal action, suit or proceeding, whether civil, criminal,
administrative or investigative (other than an action by or in the right of such
corporation), by reason of the fact that such person was an officer or director
of such corporation, or is or was serving at the request of such corporation as
a director, officer, employee or agent of another corporation or enterprise. The
indemnity may include expenses (including attorneys' fees), judgments, fines and
amounts paid in settlement actually and reasonably incurred by such person in
connection with such action, suit or proceeding, provided that such officer or
director acted in good faith and in a manner he reasonably believed to be in or
not opposed to the corporation's best interests and, for criminal proceedings,
had no reasonable cause to believe his conduct was illegal. A Delaware
corporation may indemnify officers and directors against expenses (including
attorneys' fees) in connection with the defense or settlement of an action by or
in the right of the corporation under the same conditions, except that no
indemnification is permitted without judicial approval if the officer or
director is adjudged to be liable to the corporation. Where an officer or
director is successful on the merits or otherwise in the defense of any action
referred to above, the corporation must indemnify him against the expenses which
such officer or director actually and reasonably incurred.
Article IV of the By-laws of the Company provides for indemnification of its
officers and directors to the fullest extent permitted by Section 145 of the
DGCL.
Section 102(b)(7) of the DGCL provides that a Delaware corporation may
eliminate or limit the personal liability of a director to a Delaware
corporation or its stockholders for monetary damages for breach of fiduciary
duty as a director, provided that such provision shall not eliminate or limit
the liability of a director (i) for any breach of the director's duty of loyalty
to the corporation or its stockholders, (ii) for acts or omissions not in good
faith or which involve intentional misconduct or a knowing violation of law,
(iii) under Section 174 of the DGCL relating to the unlawful payment of a
dividend or an unlawful stock purchase or redemption or (iv) for any transaction
from which the director derived an improper personal benefit.
Article 6 of the Restated Certificate of Incorporation of the Company
provides for the elimination of personal liability of its directors for monetary
damages for breach of fiduciary duty as a director, except as otherwise provided
by the DGCL.
The Company has entered into a Directors and Officers Indemnification
Agreement which provides that directors and officers shall be indemnified to the
fullest extent permitted by applicable law and obligates the Company to
indemnify the directors and officers of the Company (a) if any director or
officer is or may become a party to any proceeding against all expenses
reasonably incurred by such director or
II-1
<PAGE>
officer in connection with the defense or settlement of such proceeding, but
only if such director or officer acted in good faith and in a manner which such
director or officer reasonably believed to be in or not opposed to the best
interests of the Company and, in the case of a criminal action or proceeding,
only if such director or officer had no reasonable cause to believe that his or
her conduct was unlawful, (b) if a director or officer is or may become a party
to any proceeding by or in the name of the Company to procure a judgement in its
favor against all expenses reasonably incurred by such director or officer in
connection with the defense or settlement of such proceeding, but only if such
director or officer acted in good faith and in a manner which such director or
officer reasonably believed to be in or not opposed to the best interests of the
Company, except no indemnification for expenses need be made in respect of any
claim in which such director or officer shall have been adjudged liable to the
Company unless a court in which the proceeding is brought determines otherwise
and (c) if a director or officer has been successful on the merits or otherwise
in defense of any proceeding or claim.
The Common Stock Registration Rights Agreement and the Channel One
Registration Rights Agreement each requires the Company, on the one hand, and
the Holders referred to therein, on the other hand, under certain circumstances,
to indemnify each other and, in the case of the Company's indemnification
obligations, each other person who participates as an underwriter in an offering
thereunder and each other person who controls such parties and/or underwriters
and their respective directors, officers, partners, agents and affiliates
against certain liabilities, including liabilities under the Securities Act,
incurred in connection with each registration of securities pursuant to such
registration rights agreement.
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the provisions described hereunder or otherwise, the
Registrant has been advised that in the opinion of the Commission such
indemnification is against public policy as expressed in the Securities Act and
is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment to the Registrant of expenses
incurred or paid by a director, officer or controlling person of the Registrant
in the successful defense of any action, suit or proceeding) is asserted against
the Registrant by such director, officer or controlling person, in connection
with the Shares being registered hereby, the Registrant will, unless in the
opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Securities
Act and will be governed by the final adjudication of such issue.
II-2
<PAGE>
ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(a) Exhibits
<TABLE>
<CAPTION>
EXHIBIT NUMBER DESCRIPTION
- ----------------- -----------------------------------------------------------------------------------------
<C> <C> <S>
1(a) -- U.S. Underwriting Agreement, dated February , 1998, among Lehman Brothers Inc.,
Donaldson, Lufkin & Jenrette Securities Corporation, Merrill Lynch, Pierce, Fenner &
Smith Incorporated, Smith Barney Inc., Arnhold and S. Bleichroeder, Inc., Asbestos
Settlement Trust, Lehman Brothers Holdings Inc. and Walter Industries, Inc.
1(b) -- International Underwriting Agreement, dated February , 1998, among Lehman Brothers
International (Europe), Donaldson, Lufkin & Jenrette International, Merrill Lynch
International, Smith Barney Inc., Arnhold and S. Bleichroeder, Inc., Asbestos Settlement
Trust, Lehman Brothers Holdings Inc. and Walter Industries, Inc.
2(a)(i) -- Amended Joint Plan of Reorganization of Walter Industries, Inc. and certain of its
subsidiaries, dated as of December 9, 1994 (1)
2(a)(ii) -- Modification to the Amended Joint Plan of Reorganization of Walter Industries, Inc. and
certain of its subsidiaries, as filed in the Bankruptcy Court on March 1, 1995 (2)
2(a)( )** -- Findings of Fact, Conclusions of Law and Order Confirming Amended Joint Plan of
Reorganization of Walter Industries, Inc. and certain of its subsidiaries, as modified
3(a)** -- Restated Certificate of Incorporation of the Company
3(b)** -- By-Laws of the Company
4(a)( )** -- Restated Certificate of Incorporation of the Company (see Exhibit 3(a))
4(a)( )** -- By-Laws of the Company (see Exhibit 3(b))
4(b)** -- Specimen Stock Certificate
5** -- Opinion of Simpson Thacher & Bartlett regarding legality of the securities being
registered
23(a) -- Consent of Price Waterhouse LLP
23(b) -- Consent of Arthur Andersen LLP
23(c)** -- Consent of Simpson Thacher & Bartlett (included in their opinion filed as Exhibit 5
hereto)
24** -- Powers of Attorney
27** -- Financial Data Schedule
</TABLE>
- ------------------------
** Previously filed
(1) This Exhibit is incorporated by reference to the Application for
Qualification of Indenture on Form T-3 filed by the Company with the
Commission on February 6, 1995.
(2) This Exhibit is incorporated by reference to Amendment No. 2 to the
Application for Qualification of Indenture on Form T-3 filed by the Company
with the Commission on March 7, 1995.
II-3
<PAGE>
ITEM 17. UNDERTAKINGS
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this registration statement:
(i) To include any prospectus required by section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represents a fundamental change in the information set forth
in the registration statement;
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in the registration statement or
any material change to such information in the registration statement;
Provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply
if the registration statement is on Form S-3 or Form S-8 and the information
required to be included in a post-effective amendment by those paragraphs is
contained in periodic reports filed by the registrant pursuant to section 13
or section 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in the registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to
be the initial bona fide offering thereof.
(3) To remove from registration by means of post-effective amendment any
of the securities being registered which remain unsold at the termination of
the offering.
(b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to section 13(a) or section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the registrant pursuant to the foregoing provisions, or otherwise, the
registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
II-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Registration
Statement Amendment to be signed on its behalf by the undersigned, hereunto duly
authorized in the City of Tampa, State of Florida on the 29th day of January,
1998.
WALTER INDUSTRIES, INC.
BY /S/ DEAN M. FJELSTUL
-----------------------------------------
Dean M. Fjelstul
SENIOR VICE PRESIDENT AND
CHIEF FINANCIAL OFFICER
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement Amendment has been signed by the following persons in the
capacities indicated on January 29, 1998.
SIGNATURE TITLE
- ------------------------------ ---------------------------
*
- ------------------------------
James W. Walter Chairman Emeritus and
Director
*
- ------------------------------
Kenneth E. Hyatt Chairman of the Board,
President,
Chief Executive Officer
and Director
(Principal Executive
Officer)
*
- ------------------------------
Dean M. Fjelstul Senior Vice President and
Chief Financial Officer
(Principal Financial
Officer)
/s/ FRANK A. HULT
- ------------------------------
Frank A. Hult Vice President, Controller
and
Chief Accounting Officer
(Principal Accounting
Officer)
*
- ------------------------------
Howard L. Clark, Jr. Director
*
- ------------------------------
James B. Farley Director
*
- ------------------------------
Eliot M. Fried Director
*
- ------------------------------
Perry Golkin Director
*
- ------------------------------
James L. Johnson Director
*
- ------------------------------
Michael T. Tokarz Director
*By: /s/ FRANK A. HULT
-------------------------
Frank A. Hult
ATTORNEY-IN-FACT
II-5
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT NUMBER DESCRIPTION
- --------------- ------------
<S> <C> <C>
1(a) -- U.S. Underwriting Agreement, dated February , 1998, among Lehman Brothers Inc.,
Donaldson, Lufkin & Jenrette Securities Corporation, Merrill Lynch, Pierce, Fenner
& Smith Incorporated, Smith Barney Inc., Arnhold and S. Bleichroeder, Inc.,
Asbestos Settlement Trust, Lehman Brothers Holdings Inc. and Walter Industries,
Inc.
1(b) -- International Underwriting Agreement, dated February , 1998, among Lehman
Brothers International (Europe), Donaldson, Lufkin & Jenrette International,
Merrill Lynch International, Smith Barney Inc., Arnhold and S. Bleichroeder, Inc.,
Asbestos Settlement Trust, Lehman Brothers Holdings Inc. and Walter Industries,
Inc.
2(a)(i) -- Amended Joint Plan of Reorganization of Walter Industries, Inc. and certain of its
subsidiaries, dated as of December 9, 1994 (1)
2(a)(ii) -- Modification to the Amended Joint Plan of Reorganization of Walter Industries,
Inc. and certain of its subsidiaries, as filed in the Bankruptcy Court on March 1,
1995 (2)
2(a)(iii)** -- Findings of Fact, Conclusions of Law and Order Confirming Amended Joint Plan of
Reorganization of Walter Industries, Inc. and certain of its subsidiaries, as
modified
3(a)** -- Restated Certificate of Incorporation of the Company
3(b)** -- By-Laws of the Company
4(a)(i)** -- Restated Certificate of Incorporation of the Company (see Exhibit 3(a))
4(a)(ii)** -- By-Laws of the Company (see Exhibit 3(b))
4(b)** -- Specimen Stock Certificate
5** -- Opinion of Simpson Thacher & Bartlett regarding legality of the securities being
registered
23(a) -- Consent of Price Waterhouse LLP
23(b) -- Consent of Arthur Andersen LLP
23(c)** -- Consent of Simpson Thacher & Bartlett (included in their opinion filed as Exhibit
5 hereto)
24** -- Powers of Attorney
27** -- Financial Data Schedule
</TABLE>
- ------------------------
** Previously filed
(1) This Exhibit is incorporated by reference to the Application for
Qualification of Indenture on Form T-3 filed by the Company with the
Commission on February 6, 1995.
(2) This Exhibit is incorporated by reference to Amendment No. 2 to the
Application for Qualification of Indenture on Form T-3 filed by the Company
with the Commission on March 7, 1995.
<PAGE>
EXHIBIT 1(a)
10,000,000 SHARES
WALTER INDUSTRIES, INC.
COMMON STOCK, PAR VALUE $.01 PER SHARE
U.S. UNDERWRITING AGREEMENT
February ___, 1998
LEHMAN BROTHERS INC.
DONALDSON, LUFKIN & JENRETTE SECURITIES CORPORATION
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
SMITH BARNEY INC.
ARNHOLD and S. BLEICHROEDER, INC.
As Representatives of the several
U.S. Underwriters named in Schedule 1,
c/o Lehman Brothers Inc.
Three World Financial Center
New York, New York 10285
Dear Sirs:
Walter Industries, Inc., a Delaware corporation (the "Company"), the
Asbestos Settlement Trust (the "Settlement Trust"), Lehman Brothers
Holdings Inc. ("Lehman" and, together with the Settlement Trust, the "Selling
Stockholders") and the other holders named therein are parties to that certain
Registration Rights Agreement dated as of March 17, 1995 (the "Registration
Rights Agreement"). Pursuant to the Registration Rights Agreement, the Selling
Stockholders propose to sell to the U.S. Underwriters named in Schedule 1 hereto
(the "U.S. Underwriters") an aggregate of 10,000,000 shares (the "Firm Stock")
of the Company's common stock, par value $.01 per share (the "Common Stock").
In addition, the Settlement Trust proposes to grant to the U.S. Underwriters an
option to purchase up to an additional 1,500,000 shares of the Common Stock on
the terms and for the purposes set forth in Section 3 (the "Option Stock"). The
Firm Stock and the Option Stock, if purchased, are hereinafter collectively
called the "Stock." This is to confirm the agreement concerning the purchase of
the Stock from the Selling Stockholders by the U.S. Underwriters.
It is understood by all parties that the Company and the Selling
Stockholders are concurrently entering into an agreement dated the date hereof
(the "International Underwriting Agreement") providing for the sale by the
Selling Stockholders of 2,300,000 shares of Common Stock (including the over-
allotment option thereunder) (the "International Stock") through arrangements
with Lehman Brothers International (Europe), Donaldson, Lufkin & Jenrette
International, Merrill Lynch International, Smith Barney Inc., and Arnhold and
S. Bleichroeder, Inc. (the "International Managers"). The U.S.
<PAGE>
2
Underwriters and the International Managers simultaneously are entering into an
agreement between the U.S. and international underwriting syndicates (the
"Agreement Between U.S. Underwriters and International Managers") which provides
for, among other things, the transfer of shares of Common Stock between the two
syndicates. Two forms of prospectus are to be used in connection with the
offering and sale of shares of Common Stock contemplated by the foregoing, one
relating to the Stock and the other relating to the International Stock. The
latter form of prospectus will be identical to the former except for certain
substitute pages as included in the registration statement and amendments
thereto referred to below. Except as used in Sections 3, 4, 5, 11 and 12
herein, and except as the context may otherwise require, references herein to
the Stock shall include all the shares of the Selling Stockholders which may be
sold pursuant to either this Agreement or the International Underwriting
Agreement, and references herein to any prospectus whether in preliminary or
final form, and whether as amended or supplemented, shall include both the U.S.
and the international versions thereof.
1. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE COMPANY. The
Company represents, warrants and agrees that:
(a) A registration statement on Form S-3, as amended by
Post-Effective Amendment No. 8 thereto, with respect to the Stock has
(1) been prepared by the Company in conformity with the requirements of the
United States Securities Act of 1933 (the "Securities Act") and the rules
and regulations (the "Rules and Regulations") of the United States
Securities and Exchange Commission (the "Commission") thereunder, (2) been
filed with the Commission under the Securities Act and (3) become effective
under the Securities Act. Copies of such registration statement and the
amendments thereto have been delivered by the Company to you as the
representatives (the "Representatives") of the U.S. Underwriters. As used
in this Agreement, "Effective Time" means the date and the time as of which
such registration statement, or the most recent post-effective amendment
thereto, was declared effective by the Commission; "Effective Date" means
the date of the Effective Time; "Preliminary Prospectus" means each
prospectus included in such registration statement, or amendments thereof,
before it became effective under the Securities Act and any prospectus or
preliminary prospectus supplement filed with the Commission by the Company
with the consent of the Representatives pursuant to Rule 424(a) or Rule
424(b) of the Rules and Regulations; "Registration Statement" means such
registration statement, as amended at the Effective Time, including any
documents incorporated by reference therein at such time and all
information contained in the final prospectus and prospectus supplement
filed with the Commission pursuant to Rule 424(b) of the Rules and
Regulations in accordance with Section 6 hereof; and "Prospectus" means
such final prospectus and prospectus supplement, as filed with the
Commission pursuant to Rule 424(b) of the Rules and Regulations. Reference
made herein to any Preliminary Prospectus or to the Prospectus shall be
deemed to refer to and include any documents incorporated by reference
therein pursuant to Item 12 of Form S-3 under the Securities Act, as of the
date of such Preliminary Prospectus or the Prospectus, as the case may be,
and any reference to any amendment or
<PAGE>
3
supplement to any Preliminary Prospectus or the Prospectus shall be deemed
to refer to and include any document filed under the United States
Securities Exchange Act of 1934 (the "Exchange Act") after the date of such
Preliminary Prospectus or the Prospectus, as the case may be, and
incorporated by reference in such Preliminary Prospectus or the Prospectus,
as the case may be; and any reference to any amendment to the Registration
Statement shall be deemed to include any annual report of the Company filed
with the Commission pursuant to Section 13(a) or 15(d) of the Exchange Act
after the Effective Time that is incorporated by reference in the
Registration Statement. The Commission has not issued any order preventing
or suspending the use of any Preliminary Prospectus or Prospectus.
(b) The Registration Statement conforms, and the Prospectus and
any further amendments or supplements to the Registration Statement or the
Prospectus will, when they become effective or are filed with the
Commission, as the case may be, conform in all material respects to the
requirements of the Securities Act and the Rules and Regulations and do not
and will not, as of the applicable effective date (as to the Registration
Statement and any amendment thereto) and as of the applicable filing date
(as to the Prospectus and any amendment or supplement thereto) 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; PROVIDED that no representation or warranty is made as to
information contained in or omitted from the Registration Statement or the
Prospectus in reliance upon and in conformity with written information
furnished to the Company through the Representatives by or on behalf of any
U.S. Underwriter specifically for inclusion therein.
(c) The documents incorporated by reference in the Prospectus,
when they were filed with the Commission conformed in all material respects
to the requirements of the Exchange Act and the rules and regulations of
the Commission thereunder, and none of such documents 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; and any further documents so filed and incorporated by
reference in the Prospectus, when such documents are filed with the
Commission will conform in all material respects to the requirements of the
Exchange Act and the rules and regulations of the Commission thereunder 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.
(d) The Company and each of its subsidiaries (as defined in
Section 17) have been duly incorporated and are validly existing as
corporations in good standing under the laws of their respective
jurisdictions of incorporation, are duly qualified to do business and are
in good standing as foreign corporations in each jurisdiction in which
their respective ownership or lease of property or the conduct of their
respective businesses requires such qualification, and have all power and
authority necessary to own or hold their respective properties and to
<PAGE>
4
conduct the businesses in which they are engaged, except where the failure
to so qualify, be in good standing or have such power would not result in
material adverse change in the financial condition, results of operations,
business or assets of the Company and its subsidiaries taken as a whole (a
"Material Adverse Effect"). None of the subsidiaries of the Company, other
than Jim Walter Homes, Inc., Mid-State Homes, Inc., United States Pipe and
Foundry Company, Inc., Jim Walter Resources, Inc. and Applied Industrial
Materials Corporation (collectively, the "Significant Subsidiaries"), is a
"significant subsidiary," as such term is defined in Rule 405 of the Rules
and Regulations.
(e) The Company has an authorized capitalization as set forth in
the Prospectus, and all of the issued shares of capital stock of the
Company have been duly and validly authorized and issued, are fully paid
and non-assessable and conform to the description thereof contained in the
Prospectus; and all of the issued shares of capital stock of each
subsidiary of the Company have been duly and validly authorized and issued
and are fully paid and non-assessable and (except for directors' qualifying
shares) are owned directly or indirectly by the Company, free and clear of
all liens, encumbrances, equities or claims, except as disclosed in the
Prospectus.
(f) The shares of the Stock to be sold by the Selling
Stockholders to the U.S. Underwriters hereunder and under the International
Underwriting Agreement have been duly and validly authorized, are duly and
validly issued, fully paid and non-assessable; and the Stock will conform
to the description thereof contained in the Prospectus.
(g) This Agreement has been duly authorized, executed and
delivered by the Company.
(h) The execution, delivery and performance of this Agreement
and the International Underwriting Agreement by the Company and the
consummation of the transactions contemplated hereby and thereby will not
conflict with or result in a breach or violation of any of the terms or
provisions of, or constitute a default under, any indenture, mortgage, deed
of trust, loan agreement or other agreement or instrument to which the
Company or any of its subsidiaries is a party or by which the Company or
any of its subsidiaries is bound or to which any of the property or assets
of the Company or any of its subsidiaries is subject, except for such
conflicts, breaches, violations or defaults which would not result in a
Material Adverse Effect or materially impair the ability of the Company to
consummate the transactions contemplated hereby; nor will such actions
result in any violation of the provisions of the charter or by-laws of the
Company or any of its subsidiaries or any statute or any order, rule or
regulation of any court or governmental agency or body having jurisdiction
over the Company or any of its subsidiaries or any of their properties or
assets; and except for the registration of the Stock under the Securities
Act and such consents, approvals, authorizations, registrations or
qualifications as may be required under the Exchange Act and
<PAGE>
5
applicable state or foreign securities laws in connection with the purchase
and distribution of the Stock by the U.S. Underwriters and the
International Managers, no consent, approval, authorization or order of, or
filing or registration with, any such court or governmental agency or body
is required for the execution, delivery and performance of this Agreement,
or the International Underwriting Agreement by the Company and the
consummation of the transactions contemplated hereby and thereby.
(i) Except as disclosed in the Prospectus, there are no
contracts, agreements or understandings between the Company and any person
granting such person the right (other than rights which have been waived or
satisfied) to require the Company to file a registration statement under
the Securities Act with respect to any securities of the Company owned or
to be owned by such person or to require the Company to include such
securities in the securities registered pursuant to the Registration
Statement or in any securities being registered pursuant to any other
registration statement filed by the Company under the Securities Act.
(j) Except as disclosed in the Prospectus, the Company has not
sold or issued any shares of Common Stock during the six-month period
preceding the date of the Prospectus, including any sales pursuant to Rule
144A under, or Regulations D or S of, the Securities Act, other than shares
issued pursuant to employee benefit plans, qualified stock option plans or
other employee compensation plans or pursuant to outstanding options,
rights or warrants.
(k) The financial statements (including the related notes and
supporting schedules) filed as part of the Registration Statement or
included or incorporated by reference in the Prospectus present fairly the
financial condition and results of operations of the entities purported to
be shown thereby, at the dates and for the periods indicated, and have been
prepared in conformity with generally accepted accounting principles
applied on a consistent basis throughout the periods involved.
(l) Price Waterhouse LLP, who have certified certain financial
statements of the Company, whose report appears in the Prospectus or is
incorporated by reference therein and who have delivered an initial letter
referred to in Section 9(h) hereof, are independent public accountants as
required by the Securities Act and the Rules and Regulations; and Arthur
Andersen LLP, who have certified certain financial statements of Applied
Industrial Materials Corporation, whose report appears in the Prospectus or
is incorporated by reference therein and who have delivered an initial
letter referred to in Section 9(h) hereof, were independent accountants as
required by the Securities Act and the Rules and Regulations during the
periods covered by the financial statements on which they reported and
which are contained or incorporated in the Prospectus.
(m) The Company and each of its subsidiaries have good and
marketable title in fee simple to all real property material to the Company
and its
<PAGE>
6
subsidiaries taken as a whole and good and marketable title to all personal
property material to the Company and its subsidiaries taken as a whole
owned by them, in each case free and clear of all liens, encumbrances and
defects, except such as are described in the Prospectus or such as do not
materially affect the value of such property and do not materially
interfere with the use made and proposed to be made of such property by the
Company and its subsidiaries; and all real property and buildings held
under lease by the Company and its subsidiaries which are material to the
Company and its subsidiaries taken as a whole are held by them under valid,
subsisting and enforceable leases, with such exceptions as are not material
and do not interfere with the use made and proposed to be made of such
property and buildings by the Company and its subsidiaries.
(n) The Company and each of its subsidiaries carry, or are
covered by, insurance in such amounts and covering such risks as is
adequate for the conduct of their respective businesses and the value of
their respective properties.
(o) The Company and its subsidiaries own or possess adequate
rights to use all patents, patent applications, trademarks, service marks,
trade names, trademark registrations, service mark registrations,
copyrights and licenses necessary for the conduct of their respective
businesses and have no reason to believe that the conduct of their
respective businesses will conflict with, and have not received any notice
of any claim of conflict with, any such rights of others, except for any
such failure to own or possess or conflict which would not result in a
Material Adverse Effect.
(p) Except as disclosed in the Prospectus, there are no legal or
governmental proceedings pending to which the Company or any of its
subsidiaries is a party or of which any property or assets of the Company
or any of its subsidiaries is the subject which could reasonable be
expected to be determined so as to have a Material Adverse Effect; and, to
the best of the Company's knowledge, no such proceedings are threatened by
governmental authorities or threatened by others.
(q) The conditions for use of Form S-3, as set forth in the
General Instructions thereto, have been satisfied.
(r) There are no contracts or other documents which are required
to be described in the Prospectus or filed as exhibits to the Registration
Statement by the Securities Act or by the Rules and Regulations which have
not been described in the Prospectus or filed as exhibits to the
Registration Statement or incorporated therein by reference as permitted by
the Rules and Regulations.
(s) Except as disclosed in the Prospectus, no labor disturbance
by the employees of the Company exists or, to the knowledge of the Company,
is imminent, in either case which could reasonably be expected to have a
Material Adverse Effect.
<PAGE>
7
(t) The Company is in compliance in all material respects with
all presently applicable provisions of the Employee Retirement Income
Security Act of 1974, as amended, including the regulations and published
interpretations thereunder ("ERISA"), except where the failure to so comply
would not reasonably be expected to result in a Material Adverse Effect; no
"reportable event" (as defined in ERISA) (other than one as to which the
notice requirement is waived) has occurred with respect to any "pension
plan" (as defined in ERISA) for which the Company would have any material
liability; the Company has not incurred and does not expect to incur
liability under (i) Title IV of ERISA with respect to termination of, or
withdrawal from, any "pension plan" or (ii) Sections 412 or 4971 of the
Internal Revenue Code of 1986, as amended, including the regulations and
published interpretations thereunder (the "Code"), which could reasonably
be expected to result in a Material Adverse Effect; and each "pension plan"
for which the Company would have any liability that is intended to be
qualified under Section 401(a) of the Code has received a favorable
determination letter from the Internal Revenue Service that it is so
qualified in all material respects and, to the best of the Company's
knowledge, nothing has occurred, whether by action or by failure to act,
which would reasonably be expected to cause the loss of such qualification.
(u) Except as disclosed in the Prospectus, (i) the Company and
its subsidiaries have filed all federal, state and local income and
franchise tax returns required to be filed through the date hereof; (ii)
the Company has paid all taxes due thereon; and (iii) no tax deficiency has
been determined adversely to the Company or any of its subsidiaries which
has had (nor does the Company have any knowledge of any tax deficiency
which, if determined adversely to the Company or any of its subsidiaries,
might have) a Material Adverse Effect.
(v) Since the date as of which information is given in the
Prospectus through the date hereof, and except as may otherwise be
disclosed in the Prospectus, the Company has not (i) issued or granted any
securities, other than securities issued or granted pursuant to employee
benefit plans, qualified stock option plans or other employee compensation
plans or pursuant to outstanding options, rights or warrants, (ii) incurred
any liability or obligation, direct or contingent, which is material to the
Company and its subsidiaries taken as a whole, other than liabilities and
obligations which were incurred in the ordinary course of business,
(iii) entered into any transaction not in the ordinary course of business
which is material to the Company and its subsidiaries taken as a whole,
(iv) declared or paid any dividend on its capital stock or (v) been the
subject of an adverse decision or judgement in the nature of litigation or
arbitration which could reasonably be expected to have a Material Adverse
Effect.
(w) Neither the Company nor any of its subsidiaries (1) is in
violation of its charter or by-laws, (2) is in default in any material
respect, and no event has occurred which, with notice or lapse of time or
both, would constitute such a default, in the due performance or observance
of any term, covenant or condition contained in any material indenture,
mortgage, deed of trust, loan
<PAGE>
8
agreement or other agreement or instrument to which it is a party or by
which it is bound or to which any of its properties or assets is subject,
except for any default which would not have a Material Adverse Effect,
(3) is in violation in any material respect of any law, ordinance,
governmental rule, regulation or court decree to which it or its property
or assets may be subject or (4) has failed to obtain any material license,
permit, consent, order, certificate, franchise or other governmental
authorization, approval or permit necessary to the ownership of its
property or to the conduct of its business, except for such failures that
would not result in a Material Adverse Effect.
(x) Except as disclosed in the Prospectus, there has been no
storage, disposal, generation, manufacture, refinement, transportation,
handling or treatment of toxic wastes, medical wastes, hazardous wastes or
hazardous substances by the Company or any of its subsidiaries (or, to the
knowledge of the Company, any of their predecessors in interest) at, upon
or from any of the property now or previously owned or leased by the
Company or its subsidiaries in violation of any applicable law, ordinance,
rule, regulation, order, judgment, decree or permit or which would require
remedial action under any applicable law, ordinance, rule, regulation,
order, judgment, decree or permit, except for any violation or remedial
action which would not have, or could not be reasonably likely to have,
singularly or in the aggregate with all such violations and remedial
actions, a material adverse effect on the general affairs, management,
financial position, stockholders' equity or results of operations of the
Company and its subsidiaries; there has been no material spill, discharge,
leak, emission, injection, escape, dumping or release of any kind onto such
property or into the environment surrounding such property of any toxic
wastes, medical wastes, solid wastes, hazardous wastes or hazardous
substances due to or caused by the Company or any of its subsidiaries or
with respect to which the Company or any of its subsidiaries have
knowledge, except for any such spill, discharge, leak, emission, injection,
escape, dumping or release which would not have or would not be reasonably
likely to have, singularly or in the aggregate with all such spills,
discharges, leaks, emissions, injections, escapes, dumpings and releases, a
material adverse effect on the general affairs, management, financial
position, stockholders' equity or results of operations of the Company and
its subsidiaries; and the terms "hazardous wastes", "toxic wastes",
"hazardous substances" and "medical wastes" shall have the meanings
specified in any applicable local, state, federal and foreign laws or
regulations with respect to environmental protection.
(y) Neither the Company nor any of its subsidiaries is an
"investment company" within the meaning of such term under the United
States Investment Company Act of 1940 and the rules and regulations of the
Commission thereunder.
<PAGE>
9
2. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE SELLING
STOCKHOLDERS. Each of the Selling Stockholders represents, warrants and agrees
that:
(a) The Selling Stockholder has, and immediately prior to each
Delivery Date (as defined in Section 5 hereof) the Selling Stockholder will
have good and valid title to the shares of Stock to be sold by the Selling
Stockholder hereunder and under the International Underwriting Agreement on
such date, free and clear of all liens, encumbrances, equities or claims;
and upon delivery of such shares and payment therefor pursuant hereto and
thereto, good and valid title to such shares, free and clear of all liens,
encumbrances, equities or claims, will pass to the several U.S.
Underwriters and the International Managers.
(b) The Selling Stockholder has placed in custody with Harris
Trust and Savings Bank, as custodian (the "Custodian"), for delivery under
this Agreement and the International Underwriting Agreement, certificates
in negotiable form (with signature guaranteed by a commercial bank or
trust company having an office or correspondent in the United States or a
member firm of the New York or American Stock Exchanges) representing the
shares of Stock to be sold by the Selling Stockholder hereunder and
thereunder.
(c) The Selling Stockholder has duly and irrevocably executed
and delivered a Power of Attorney and Custody Agreement (the "Power of
Attorney and Custody Agreement" and, together with all other similar
agreements executed by the other Selling Stockholders, the "Power of
Attorney and Custody Agreements") regarding custody arrangements referred
to in the immediately preceeding paragraph and appointing the Custodian or
one or more other persons, as attorneys-in-fact, with full power of
substitution, and with full authority (exercisable by any one or more of
them) to execute and deliver this Agreement and the International
Underwriting Agreement and to take such other action as may be necessary
or desirable to carry out the provisions hereof or thereof on behalf of
the Selling Stockholder.
(d) The Selling Stockholder has been duly organized and is
validly existing in good standing under the laws of its jurisdiction of
organization and has full right, power and authority to enter into this
Agreement, the International Underwriting Agreement and the Power of
Attorney and Custody Agreement; the execution, delivery and performance of
this Agreement, the International Underwriting Agreement and the Power of
Attorney and Custody Agreement by the Selling Stockholder and the
consummation by the Selling Stockholder of the transactions contemplated
hereby and thereby will not conflict with or result in a breach or
violation in any material respect of any of the terms or provisions of, or
constitute a default under, any indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument to which the Selling Stockholder
is a party or by which the Selling Stockholder is bound or to which any of
the
<PAGE>
10
property or assets of the Selling Stockholder is subject, nor will such
actions result in any violation in any material respect of the provisions
of the charter, by-laws, trust instrument or other organizing instrument
(as applicable) of the Selling Stockholder or any statute or any order,
rule or regulation of any court or governmental agency or body having
jurisdiction over the Selling Stockholder or the property or assets of the
Selling Stockholder; and, except for the registration of the Stock under
the Securities Act and such consents, approvals, authorizations, filings,
registrations or qualifications as may be required under the Exchange Act
(including filings pursuant to Sections 13 and 16 of the Exchange Act) and
applicable state or foreign securities laws in connection with the purchase
and distribution of the Stock by the U.S. Underwriters and the
International Managers, no consent, approval, authorization or order of, or
filing or registration with, any such court or governmental agency or body
is required for the execution, delivery and performance of this Agreement
or the International Underwriting Agreement, by the Selling Stockholder and
the consummation by the Selling Stockholder of the transactions
contemplated hereby and thereby.
(e) The Selling Stockholder has not taken and will not take,
directly or indirectly, any action which is designed to or which has
constituted or which might reasonably be expected to cause or result in the
stabilization or manipulation of the price of any security of the Company
to facilitate the sale or resale of the shares of the Stock.
(f) The information specifically relating to the Selling
Stockholder contained in the Prospectus does 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 in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading.
(g) All authorizations, approvals and consents necessary for the
execution and delivery by such Selling Stockholder of this Agreement, the
International Underwriting Agreement, the Power of Attorney and Custody
Agreement and the sale and delivery of the Stock to be sold by it hereunder
and under the International Underwriting Agreement (other than such
authorizations, approvals or consents as may be necessary under state or
foreign securities laws) have been obtained and are in full force and
effect.
(h) This Agreement, the International Underwriting Agreement and
the Power of Attorney and Custody Agreement have been duly executed and
delivered by such Selling Stockholder.
3. Purchase of the Stock by the U.S. Underwriters. On the basis of
the representations and warranties contained in, and subject to the terms and
conditions of, this Agreement, each Selling Stockholder agrees to sell the
number of shares of the Firm Stock set forth opposite its name on Schedule 2
hereto, severally and not jointly, to the several U.S. Underwriters and each of
the U.S. Underwriters, severally and not
<PAGE>
11
jointly, agrees to purchase the number of shares of the Firm Stock set opposite
that U.S. Underwriter's name in Schedule 1 hereto. Each U.S. Underwriter shall
be obligated to purchase from each Selling Stockholder that number of shares of
the Firm Stock which represents the same proportion of the number of shares of
the Firm Stock to be sold by each Selling Stockholder as the number of shares of
the Firm Stock set forth opposite the name of such U.S. Underwriter in Schedule
1 represents of the total number of shares of the Firm Stock to be purchased by
all of the U.S. Underwriters pursuant to this Agreement. The respective
purchase obligations of the U.S. Underwriters with respect to the Firm Stock
shall be rounded among the U.S. Underwriters to avoid fractional shares, as the
Representatives may determine.
In addition, the Settlement Trust grants to the U.S. Underwriters an
option to purchase up to the number of shares of Option Stock set forth opposite
its name on Schedule 2 hereto, severally and not jointly. Such option is
granted for the purpose of covering over-allotments in the sale of Firm Stock
and is exercisable as provided in Section 5 hereof. Shares of Option Stock
shall be purchased severally for the account of the U.S. Underwriters in
proportion to the number of shares of Firm Stock set opposite the name of such
U.S. Underwriters in Schedule 1 hereto. The respective purchase obligations of
each U.S. Underwriter with respect to the Option Stock shall be adjusted by the
Representatives so that no U.S. Underwriter shall be obligated to purchase
Option Stock other than in 100 share amounts.
The price of both the Firm Stock and the Option Stock shall be
$_________ per share.
The Selling Stockholders shall not be obligated to deliver any of the
Stock to be delivered on any Delivery Date (as hereinafter defined), as the
case may be, except upon payment for all the Stock to be purchased on such
Delivery Date as provided herein and in the International Underwriting
Agreement.
4. OFFERING OF STOCK BY THE U.S. UNDERWRITERS. Upon authorization by
the Representatives of the release of the Firm Stock, the several U.S.
Underwriters propose to offer the Firm Stock for sale upon the terms and
conditions set forth in the Prospectus.
5. DELIVERY OF AND PAYMENT FOR THE STOCK. Delivery of and payment
for the Firm Stock shall be made at the office of Paul, Weiss, Rifkind,
Wharton & Garrison, 1285 Avenue of the Americas, New York, NY 10019, at
10:00 A.M., New York City time, on the fourth full business day following the
date of this Agreement or at such other date or place as shall be determined by
agreement between the Representatives and the Selling Stockholders. This date
and time are sometimes referred to as the "First Delivery Date." On the First
Delivery Date, the Selling Stockholders shall deliver or cause to be delivered
certificates representing the Firm Stock to the Representatives for the account
of each U.S. Underwriter against payment to or upon the order of each Selling
Stockholder of the purchase price by wire transfer in immediately available
funds. Time shall be of the essence, and delivery at the time
<PAGE>
12
and place specified pursuant to this Agreement is a further condition of the
obligation of each U.S. Underwriter hereunder. Upon delivery, the Firm Stock
shall be registered in such names and in such denominations as the
Representatives shall request in writing not less than two full business days
prior to the First Delivery Date. For the purpose of expediting the checking
and packaging of the certificates for the Firm Stock, the Selling Stockholders
shall make the certificates representing the Firm Stock available for inspection
by the Representatives in New York, New York, not later than 2:00 P.M., New York
City time, on the business day prior to the First Delivery Date.
The option granted in Section 3 will expire 30 days after the date of
this Agreement and may be exercised in whole or in part from time to time prior
to such expiration by written notice being given to the Company and each Selling
Stockholder by the Representatives. Such notice shall set forth the aggregate
number of shares of Option Stock as to which the option is being exercised, the
names in which the shares of Option Stock are to be registered, the
denominations in which the shares of Option Stock are to be sold and the date
and time, as determined by the Representatives, when the shares of Option Stock
are to be delivered; PROVIDED, HOWEVER, that this date and time shall not be
earlier than the First Delivery Date nor earlier than the second business day
after the date on which the option shall have been exercised nor later than the
fifth business day after the date on which the option shall have been exercised.
The date and time the shares of Option Stock are delivered are sometimes
referred to as a "Second Delivery Date" and the First Delivery Date and any
Second Delivery Date are sometimes each referred to as a "Delivery Date."
Delivery of and payment for the Option Stock shall be made at the
place specified in the first sentence of the first paragraph of this Section 5
(or at such other place as shall be determined by agreement between the
Representatives, the Company and the Selling Stockholders) at 10:00 A.M.,
New York City time, on such Second Delivery Date. On such Second Delivery Date,
each Selling Stockholder shall deliver or cause to be delivered the certificates
representing the Option Stock to the Representatives for the account of each
U.S. Underwriter against payment to or upon the order of each Selling
Stockholder of the purchase price by wire transfer in immediately available
funds. Time shall be of the essence, and delivery at the time and place
specified pursuant to this Agreement is a further condition of the obligation of
each U.S. Underwriter hereunder. Upon delivery, the Option Stock shall be
registered in such names and in such denominations as the Representatives shall
request in the aforesaid written notice. For the purpose of expediting the
checking and packaging of the certificates for the Option Stock, the Selling
Stockholders shall make the certificates representing the Option Stock available
for inspection by the Representatives in New York, New York, not later than 2:00
P.M., New York City time, on the business day prior to such Second Delivery
Date.
<PAGE>
13
6. FURTHER AGREEMENTS OF THE COMPANY. The Company agrees:
(a) To comply with the requirements of Rules 424(b) and 430A
under the Securities Act; to make no further amendment or any supplement to
the Registration Statement or to the Prospectus prior to the last Delivery
Date in violation of Section 6(e) hereof; to advise the Representatives,
promptly after it receives notice thereof, of the time when any amendment
to the Registration Statement has been filed or becomes effective or any
supplement to the Prospectus or any amended Prospectus has been filed and
to furnish the Representatives with copies thereof; to file timely all
reports and any definitive proxy or information statements required to be
filed by the Company with the Commission pursuant to Section 13(a), 13(c),
14 or 15(d) of the Exchange Act subsequent to the date of the Prospectus
and for so long as the delivery of a prospectus is required in connection
with the offering or sale of the Stock; to advise the Representatives,
promptly after it receives notice thereof, of the issuance by the
Commission of any stop order or of any order preventing or suspending the
use of any Preliminary Prospectus or the Prospectus, of the suspension of
the qualification of the Stock for offering or sale in any jurisdiction, of
the initiation or threatening of any proceeding for any such purpose, or of
any request by the Commission for the amending or supplementing of the
Registration Statement or the Prospectus or for additional information;
and, in the event of the issuance of any stop order or of any order
preventing or suspending the use of any Preliminary Prospectus or the
Prospectus or suspending any such qualification, to use promptly its
reasonable best efforts to obtain its withdrawal.
(b) To furnish promptly to each of the Representatives and to
counsel for the U.S. Underwriters a signed copy of the Registration
Statement as originally filed with the Commission, and each amendment
thereto filed with the Commission, including all consents and exhibits
filed therewith.
(c) To deliver promptly to the Representatives and to the
Selling Stockholders such number of the following documents as the
Representatives or the Selling Stockholders shall reasonably request:
(1) conformed copies of the Registration Statement as originally filed with
the Commission and each amendment thereto (in each case excluding exhibits
other than this Agreement), (2) each Preliminary Prospectus, the Prospectus
and any amended or supplemented Prospectus and (3) any document
incorporated by reference in the Prospectus (excluding exhibits thereto);
and, if the delivery of a prospectus is required at any time after the
Effective Time in connection with the offering or sale of the Stock or any
other securities relating thereto and if at such time any events shall have
occurred as a result of which the Prospectus as then amended or
supplemented would include an untrue statement of a material fact or omit
to state any material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made when
such Prospectus is delivered, not misleading, or, if for any other reason
it shall be
<PAGE>
14
necessary to amend or supplement the Prospectus or to file under the
Exchange Act any document incorporated by reference in the Prospectus in
order to comply with the Securities Act or the Exchange Act, to notify the
Representatives and, upon their request, to file such document and to
prepare and furnish without charge to each U.S. Underwriter and to any
dealer in securities as many copies as the Representatives may from time to
time reasonably request of an amended or supplemented Prospectus which will
correct such statement or omission or effect such compliance.
(d) To file as promptly as practicable with the Commission any
amendment to the Registration Statement or the Prospectus or any supplement
to the Prospectus that is required by the Securities Act or requested by
the Commission.
(e) Prior to filing with the Commission any amendment to the
Registration Statement or supplement to the Prospectus, any document
incorporated by reference in the Prospectus or any Prospectus pursuant to
Rule 424 of the Rules and Regulations, to furnish a copy thereof to the
Representatives and counsel for the U.S. Underwriters and not to file any
such document to which the Representatives shall reasonably object after
having been given reasonable notice of the proposed filing thereof.
(f) As soon as practicable after the Effective Date (it being
understood that the Company shall have until at least 410 days after the
end of the Company's current fiscal quarter), to make generally available
to the Company's security holders and to deliver to the Representatives an
earnings statement of the Company and its subsidiaries (which need not be
audited) complying with Section 11(a) of the Securities Act and the Rules
and Regulations (including, at the option of the Company, Rule 158).
(g) From time to time to take such action as the Representatives
may reasonably request to qualify the Stock for offering and sale under the
securities laws of such jurisdictions as the Representatives may reasonably
request and to comply with such laws so as to permit the continuance of
sales and dealings therein in such jurisdictions for as long as may be
necessary to complete the distribution of the Stock; provided that in
connection therewith the Company shall not be required to qualify as a
foreign corporation or to file a general consent to service of process in
any jurisdiction.
(h) For a period of 120 days from the date on which
Post-Effective Amendment No. 8 to the Registration Statement is filed, not
to, directly or indirectly, (1) offer for sale, sell, pledge (other than
pledges in existence on the date thereof) or otherwise dispose of (or enter
into any transaction or device which is designed to, or could be expected
to, result in the disposition by any person at any time in the future of)
any shares of Common Stock or securities convertible into or exchangeable
for Common Stock (other
<PAGE>
15
than the Stock and shares issued pursuant to employee benefit plans,
qualified stock option plans or other employee compensation plans existing
on the date hereof or pursuant to currently outstanding options, warrants
or rights), or sell or grant options, rights or warrants with respect to
any shares of Common Stock or securities convertible into or exchangeable
for Common Stock (other than the grant of options pursuant to option plans
existing on the date hereof), or (2) enter into any swap or other
derivatives transaction that transfers to another, in whole or in part, any
of the economic benefits or risks of ownership of such shares of Common
Stock, whether any such transaction described in clause (1) or (2) above is
to be settled by delivery of Common Stock or other securities, in cash or
otherwise, in each case without the prior written consent of Lehman
Brothers Inc. and Donaldson, Lufkin & Jenrette Securities Corporation
("DLJ") (which consent shall not be unreasonably withheld); and to use its
reasonable efforts to cause each executive officer and director of the
Company and the persons listed on Schedule 3 hereto to furnish to the
Representatives, prior to the First Delivery Date, a letter or letters, in
form and substance reasonably satisfactory to counsel for the U.S.
Underwriters, pursuant to which each such person shall agree not to,
directly or indirectly, (1) offer for sale, sell, pledge (other than
pledges in existence on the date hereof) or otherwise dispose of (or enter
into any transaction or device which is designed to, or could be expected
to, result in the disposition by any person at any time in the future of)
any shares of Common Stock or securities convertible into or exchangeable
for Common Stock or (2) enter into any swap or other derivatives
transaction that transfers to another, in whole or in part, any of the
economic benefits or risks of ownership of such shares of Common Stock,
whether any such transaction described in clause (1) or (2) above is to be
settled by delivery of Common Stock or other securities, in cash or
otherwise, in each case for a period of 120 days from the date on which
Post-Effective Amendment No. 8 to the Registration Statement is filed,
without the prior written consent of Lehman Brothers Inc. and DLJ (which
consent shall not be unreasonably withheld), except in each case for
transfers or pledges to or transactions with affiliates, heirs, executors
and legal representatives of such persons.
(i) To take such steps as shall be necessary to ensure that
neither the Company nor any subsidiary shall become an "investment company"
within the meaning of such term under the United States Investment Company
Act of 1940 and the rules and regulations of the Commission thereunder.
7. FURTHER AGREEMENT OF THE SELLING STOCKHOLDERS. Each of the
Selling Stockholders agrees:
(a) to deliver to the Representatives prior to the First
Delivery Date a properly completed and executed United States Treasury
Department Form W-9.
<PAGE>
16
(b) For a period of 120 days from the date the Registration
Statement is declared effective, not to, directly or indirectly, (1) offer
for sale, sell, pledge (other than pledges in existence on the date
thereof) or otherwise dispose of (or enter into any transaction or device
which is designed to, or could be expected to, result in the disposition by
any person at any time in the future of) any shares of Common Stock or
securities convertible into or exchangeable for Common Stock or (2) enter
into any swap or other derivatives transaction that transfers to another,
in whole or in part, any of the economic benefits or risks of ownership of
such shares of Common Stock, whether any such transaction described in
clause (1) or (2) above is to be settled by delivery of Common Stock or
other securities, in cash or otherwise, in each case without the prior
written consent of Lehman Brothers Inc. and DLJ in the case of the
Settlement Trust or without the consent of Lehman Brothers Inc. in the case
of Lehman Brothers Holdings Inc., which consents shall not be unreasonably
withheld.
(c) That the Stock to be sold by the Selling Stockholder
hereunder which is represented by the certificates held in custody for the
Selling Stockholder is subject to the interest of the U.S. Underwriters and
the other Selling Stockholder thereunder that the arrangements made by the
Selling Stockholder for such custody are to that extent irrevocable, and
that the obligations of the Selling Stockholder hereunder shall not be
terminated by any act of the Selling Stockholder, by operation of law or by
the death or incapacity of any executor or trustee or the termination of
the Settlement Trust, or the occurrence of any other event.
8. EXPENSES. Subject to Section 13 hereof, the Company agrees to
pay (a) the costs incident to the authorization, sale and delivery of the Stock
and any taxes payable in that connection; (b) the costs incident to the
preparation, printing and filing under the Securities Act of the Registration
Statement and any amendments and exhibits thereto; (c) the costs of distributing
the Registration Statement as originally filed and each amendment thereto and
any post-effective amendments thereof (including, in each case, exhibits), any
Preliminary Prospectus, the Prospectus and any amendment or supplement to the
Prospectus or any document incorporated by reference therein, all as provided in
this Agreement; (d) the costs of producing and distributing this Agreement, the
Agreement Between U.S. Underwriters and International Managers and any other
related documents in connection with the offering, purchase, sale and delivery
of the Stock; (e) the filing fees incident to securing any required review by
the National Association of Securities Dealers, Inc. of the terms of sale of the
Stock; (f) any applicable listing or other fees; (g) the fees and expenses of
qualifying the Stock under the securities laws of the several jurisdictions as
provided in Section 6(g) and of preparing, printing and distributing a Blue Sky
Memorandum (including related fees and expenses of counsel to the U.S.
Underwriters); (h) all other costs and expenses incident to the performance of
the obligations of the Company and the Selling Stockholders under this
Agreement; and (i) all Expenses (as defined in the Registration Rights
Agreement); PROVIDED that, except as expressly provided otherwise in this
Section 8 the
<PAGE>
17
U.S. Underwriters shall pay their own costs and expenses, including the costs
and expenses of their counsel, any transfer taxes on the Stock which they may
sell and the expenses of advertising any offering of the Stock made by the U.S.
Underwriters and any transfer taxes payable in connection with its respective
sales of Stock to the U.S. Underwriters and reimburse the Company for its pro
rata share of the fees and expenses paid by the Company in connection with the
offering of the Stock; and PROVIDED FURTHER that notwithstanding anything to the
contrary in the foregoing, the Selling Stockholders shall pay all underwriting
discounts and commissions and all other costs and expenses incident to the
transactions contemplated hereby which are not Expenses (as defined in the
Registration Rights Agreement) payable by the Company pursuant to the
Registration Rights Agreement.
9. CONDITIONS OF U.S. UNDERWRITERS' OBLIGATIONS. The respective
obligations of the U.S. Underwriters hereunder are subject to the accuracy, when
made and on each Delivery Date, of the representations and warranties of the
Company and each of the Selling Stockholders contained herein, to the
performance by the Company and each of the Selling Stockholders of its
respective obligations hereunder, and to each of the following additional terms
and conditions:
(a) The Prospectus shall have been timely filed with the
Commission in accordance with Section 6(a); no stop order suspending the
effectiveness of the Registration Statement or any part thereof shall have
been issued and no proceeding for that purpose shall have been initiated or
threatened by the Commission; and any request of the Commission for
inclusion of additional information in the Registration Statement or the
Prospectus or otherwise shall have been complied with.
(b) No U.S. Underwriter or International Manager shall have
discovered and disclosed to the Company on or prior to such Delivery Date
that the Registration Statement or the Prospectus or any amendment or
supplement thereto contains an untrue statement of a fact which, in the
opinion of counsel for the U.S. Underwriters, is material or omits to state
a fact which, in the opinion of such counsel, is material and is required
to be stated therein or is necessary to make the statements therein not
misleading.
(c) All corporate proceedings and other legal matters incident
to the authorization, form and validity of this Agreement, the
International Underwriting Agreement, the Stock, the Registration Statement
and the Prospectus, and all other legal matters relating to this Agreement
and the transactions contemplated hereby shall be reasonably satisfactory
in all material respects to counsel for the U.S. Underwriters, and the
Company and each of the Selling Stockholders shall have furnished to such
counsel all documents and information that they may reasonably request to
enable them to pass upon such matters.
<PAGE>
18
(d) Edward A. Porter, Vice President, General Counsel and
Secretary of the Company, shall have furnished to the Representatives his
written opinion, as counsel to the Company, addressed to the U.S.
Underwriters and dated such Delivery Date, in form and substance reasonably
satisfactory to the Representatives, to the effect that:
1. Each of the Company's Significant Subsidiaries has been duly
incorporated and is validly existing as a corporation in good standing
under the laws of its respective jurisdiction of incorporation; and
the Company and each of its Significant Subsidiaries are duly
qualified to do business and are in good standing as foreign
corporations in each jurisdiction in which their respective ownership
or lease of property or the conduct of their respective businesses
requires such qualification and have all corporate power and authority
necessary to own or hold their respective properties and conduct the
businesses in which they are engaged;
2. The Company has an authorized capitalization as set forth in
the Prospectus, and all of the issued shares of capital stock of the
Company (including the shares of Stock being delivered on such
Delivery Date) have been duly and validly authorized and issued, are
fully paid and non-assessable and conform to the description thereof
contained in the Prospectus; and all of the issued shares of capital
stock of each Significant Subsidiary of the Company have been duly and
validly authorized and issued and are fully paid, non-assessable and
(except for directors' qualifying shares and except as disclosed in
the Prospectus) are owned directly or indirectly by the Company, free
and clear of all liens, encumbrances, equities or claims;
3. Except as disclosed in the Prospectus, there are no
preemptive or other rights to subscribe for or to purchase, nor any
restriction upon the voting or transfer of, any shares of the Stock
pursuant to the Company's charter or by-laws or any agreement or other
instrument known to such counsel;
4. To the best of such counsel's knowledge and except as
disclosed in the Prospectus, there are no legal or governmental
proceedings pending to which the Company or any of its subsidiaries is
a party or of which any property or assets of the Company or any of
its subsidiaries is the subject which could reasonably be expected to
be determined so as to have a Material Adverse Effect; and, to the
best of such counsel's knowledge, no such proceedings are threatened
by governmental authorities or threatened by others;
5. To the best of such counsel's knowledge, there are no
contracts or other documents which are required to be described in the
<PAGE>
19
Prospectus or filed as exhibits to the Registration Statement by the
Securities Act or by the Rules and Regulations which have not been
described or filed as exhibits to the Registration Statement or
incorporated therein by reference as permitted by the Rules and
Regulations;
6. This Agreement and the International Underwriting Agreement
has each been duly authorized, executed and delivered by the Company;
7. The compliance by the Company with all of the provisions of
this Agreement and the International Underwriting Agreement and the
consummation of the transactions contemplated hereby and thereby will
not conflict with or result in a breach or violation of any of the
terms or provisions of, or constitute a default under, any indenture,
mortgage, deed of trust, loan agreement or other agreement or
instrument known to such counsel to which the Company or any of its
subsidiaries is a party or by which the Company or any of its
subsidiaries is bound or to which any of the property or assets of the
Company or any of its subsidiaries is subject, except for such
conflicts, breaches, violations or defaults which would not result in
a Material Adverse Effect or materially impair the ability of the
Company to consummate the transactions contemplated hereby; nor will
such actions result in any violation of the provisions of the charter
or by-laws of the Company or any of its subsidiaries or any statute or
any order, rule or regulation known to such counsel of any court or
governmental agency or body having jurisdiction over the Company or
any of its subsidiaries or any of their properties or assets, except
for such violations of statutes, orders, rules or regulations which
would not result in a Material Adverse Effect or materially impair the
ability of the Company to consummate the transactions contemplated
hereby; and, except for the registration of the Stock under the
Securities Act and such consents, approvals, authorizations,
registrations or qualifications as may be required under the Exchange
Act and applicable state or foreign securities laws in connection with
the purchase and distribution of the Stock by the U.S. Underwriters
and the International Managers, no consent, approval, authorization or
order of, or filing or registration with, any such court or
governmental agency or body is required for the execution, delivery
and performance of this Agreement or the International U.S.
Underwriting Agreement by the Company and the consummation of the
transactions contemplated hereby and thereby; and
8. To the best of such counsel's knowledge, other than as
disclosed in the Prospectus, there are no contracts, agreements or
understandings between the Company and any person granting such person
the right (other than rights which have been waived or satisfied)
<PAGE>
20
to require the Company to file a registration statement under the
Securities Act with respect to any securities of the Company owned or
to be owned by such person or to require the Company to include such
securities in the securities registered pursuant to the Registration
Statement or in any securities being registered pursuant to any other
registration statement filed by the Company under the Securities Act.
In rendering such opinion, such counsel may state that he does
not express any opinion concerning any law other than the laws of the
States of Wisconsin and Texas and the Delaware General Corporation Law
and such counsel may rely (to the extent such counsel deems proper and
specifies in its opinion) as to matters involving the application of
the laws of the States of Alabama and Florida, respectively, upon the
opinion of Bradley, Arant, Rose & White and Carlton, Fields, Ward,
Emmanuel, Smith & Cutler or other counsel reasonably satisfactory
to counsel to the U.S. Underwriters, provided that each such
Alabama and Florida counsel furnishes a copy of its opinion to the
Representatives. Such counsel shall also have furnished to the
Representatives a written statement, addressed to the U.S.
Underwriters and dated such Delivery Date, in form and substance
reasonably satisfactory to the Representatives, to the effect that
(i) such counsel has not independently verified the accuracy,
completeness or fairness of the statements made or included in the
Registration Statement, the Prospectus or the documents incorporated
by reference in the Prospectus (the "Exchange Act Documents") and
takes no responsibility therefor, (ii) such counsel has acted as
General Counsel to the Company and has participated in the
preparation of the Registration Statement, and (iii) based upon such
counsel's examination of the Registration Statement, the Prospectus
and the Exchange Act Documents and his investigations made in
connection with the preparation of the Registration Statement, the
Prospectus and the Exchange Act Documents, such counsel has no reason
to believe that the Registration Statement as of its effective date
contained any untrue statement of a material fact or omitted to state
any material fact required to be stated therein or necessary in order
to make the statements therein not misleading or that the Prospectus
contains any untrue statement of a material fact or omits to state any
material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not
misleading, except that in each case such counsel may express no
belief with respect to the financial statements or other financial
or statistical data contained or incorporated by reference in the
Registration Statement or the Prospectus.
(e) Simpson Thacher & Bartlett shall have furnished to the
Representatives its written opinion, as counsel to the Company, addressed
to the U.S. Underwriters and dated such Delivery Date, in form and
substance reasonably satisfactory to the Representatives, to the effect
that;
<PAGE>
21
1. The Company has been duly incorporated and is validly
existing and in good standing as a corporation under the laws of the
State of Delaware;
2. The Registration Statement has become effective under the
Securities Act and the Prospectus was filed on the date specified in
such opinion pursuant to Rule 424(b) of the Rules and Registrations
and, to such counsel's knowledge, no stop order suspending the
effectiveness of the Registration Statement has been issued or
proceeding for that purpose has been instituted or threatened by the
Commission;
3. The statements made in the Prospectus under the caption
"CERTAIN FEDERAL INCOME TAX CONSEQUENCES," insofar as they purport to
constitute summaries of matters under United States federal tax law
and regulations or legal conclusions with respect thereto, and the
statements made in the Prospectus under the caption "DESCRIPTION OF
CAPITAL STOCK," insofar as they purport to constitute summaries of the
Stock and of legal matters, constitute accurate summaries of the
matters described therein in all material respects;
In rendering such opinion, such counsel may state that (i) such
counsel has acted as counsel to the Company in connection with the
Offering and (ii) it does not express any opinion concerning any law
other than the law of the State of New York, the federal law of the
United States and the Delaware General Corporation Law. Such counsel
shall also have furnished to the Representatives a written statement,
addressed to the U.S. Underwriters and dated such Delivery Date, in
form and substance reasonably satisfactory to the Representatives, to
the effect that (i) such counsel has not independently verified the
accuracy, completeness or fairness of the statements made or included
in the Registration Statement, the Prospectus or the Exchange Act
Documents and takes no responsibility therefor, except as and to the
extent set forth in paragraph 3 above, (ii) in the course of the
preparation by the Company of the Registration Statement and the
Prospectus (excluding the Exchange Act Documents) such counsel
participated in conferences with certain officers and employees of the
Company, and (iii) based upon such counsel's examination of the
Registration Statement, the Prospectus and the Exchange Act
Documents, its investigations made in connection with the preparation
of the Registration Statement and the Prospectus and its
participation in the conferences referred to above, (A) such counsel
is of the opinion that the Registration Statement, as of its
effective date, the Prospectus, as of its date, and the Exchange
Act Documents as of their respective dates of filing, complied as to
form in all material respects with the requirements of the Act and
the applicable rules and regulations of the Commission thereunder,
except that in each case such counsel expresses no opinion with
respect to the financial statements or other financial or statistical
data contained or incorporated by reference in the
<PAGE>
22
Registration Statement, the Prospectus or the Exchange Act Documents,
and (B) such counsel has no reason to believe that the Registration
Statement, as of the Effective Date, including the Exchange Act
Documents on file with the Commission on such Effective Date,
contained any untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary in
order to make the statements therein not misleading, or that the
Prospectus (including the Exchange Act Documents) contains any untrue
statement of a material fact or omits to state any material fact
required to be stated therein or necessary in order to make the
statements therein, in the light of the circumstances under which
they were made, not misleading, except that in each case such counsel
may express no belief with respect to the financial statements or
other financial or statistical data contained or incorporated
by reference in the Registration Statement, the Prospectus or the
Exchange Act Documents.
(f) The Representatives shall have received from each of
Kevin R. Genirs, counsel for Lehman, and Keating, Muething & Klekamp
P.L.L., counsel for the Settlement Trust, a written opinion, addressed to
the U.S. Underwriters and dated such Delivery Date, in form and substance
reasonably satisfactory to the Representatives, to the effect that:
1. Such Selling Stockholder has full right, power and authority
to enter into this Agreement, the International Underwriting
Agreement, the Power of Attorney and the Custody Agreement and to
perform its obligations hereunder and thereunder;
2. This Agreement and the International Underwriting Agreement
have been duly authorized, executed and delivered by or on behalf of
such Selling Stockholder;
3. A Power-of-Attorney and a Custody Agreement have been duly
authorized, executed and delivered by the such Selling Stockholder and
constitute valid and binding agreements of such Selling Stockholder,
enforceable in accordance with their respective terms; and
4. The execution, delivery and performance of this Agreement,
the International Underwriting Agreement, the Power of Attorney and
the Custody Agreement by such Selling Stockholder and the consummation
by such Selling Stockholder of the transactions contemplated hereby
and thereby will not conflict with or result in a breach or violation
in any material respect of any of the terms or provisions of, or
constitute a default under, any material indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument known to such
counsel to which such Selling Stockholder is a party or by which such
Selling Stockholder is bound or to which any of the property or assets
of such Selling Stockholder is subject, nor will such actions result
in any violation in any material respect of the provisions of the
charter, by-laws, trust instrument or other organizing instrument (as
<PAGE>
23
applicable) of such Selling Stockholder or any statute or any order,
rule or regulation known to such counsel of any court or governmental
agency having jurisdiction over such Selling Stockholder or the
property or assets of such Selling Stockholder; and no consent,
approval, authorization or order of, or filing or registration with,
any such court or governmental agency is required for the execution,
delivery and performance of this Agreement, the International
Underwriting Agreement, the Power of Attorney and the Custody
Agreement by such Selling Stockholder and the consummation by such
Selling Stockholder of the transactions contemplated hereby and
thereby, except the registration under the Securities Act of the
Stock, such consents, approvals, authorizations, registrations,
filings or qualifications as may be required under state securities or
Blue Sky laws in connection with the purchase and distribution of the
shares by the U.S. Underwriters or as may be required by the laws of
any country other than the United States, and amendments to filings
made under the Exchange Act.
(g) The Representatives shall have received from Paul, Weiss,
Rifkind, Wharton & Garrison, counsel for the U.S. Underwriters, such
opinion or opinions, dated such Delivery Date, with respect to the sale of
the Stock, the Registration Statement, the Prospectus and other related
matters as the Representatives may reasonably require, and the Company
shall have furnished to such counsel such documents as they reasonably
request for the purpose of enabling them to pass upon such matters.
(h) At the time of execution of this Agreement, the
Representatives shall have received a letter from each of Price
Waterhouse LLP and Arthur Andersen LLP, in form and substance reasonably
satisfactory to the Representatives, addressed to the U.S. Underwriters and
dated the date hereof (1) confirming that they are independent public
accountants within the meaning of the Securities Act and are in compliance
with the applicable requirements relating to the qualification of
accountants under Rule 2-01 of Regulation S-X of the Commission and
(2) stating, as of the date hereof (or, with respect to matters involving
changes or developments since the respective dates as of which specified
financial information is given in the Prospectus, as of a date not more
than five days prior to the date hereof), the conclusions and findings of
such firm with respect to the financial information and other matters
ordinarily covered by accountants' "comfort letters" to underwriters in
connection with registered public offerings.
(i) With respect to each of the letters of Price Waterhouse LLP
and Arthur Andersen LLP referred to in the preceding paragraph and
delivered to the Representatives concurrently with the execution of this
Agreement (each, an "initial letter"), the Company shall have furnished to
the Representatives a letter (the "bring-down letter") of each of such firm
of accountants, addressed to the U.S. Underwriters and dated such Delivery
Date
<PAGE>
24
(1) confirming that they are independent public accountants within the
meaning of the Securities Act and are in compliance with the applicable
requirements relating to the qualification of accountants under Rule 2-01
of Regulation S-X of the Commission and (2) stating, as of the date of the
bring-down letter (or, with respect to matters involving changes or
developments since the respective dates as of which specified financial
information is given in the Prospectus, as of a date not more than three
days prior to the date of the bring-down letter), the conclusions and
findings of such firm with respect to the financial information and other
matters covered by the respective initial letter.
(j) The Company shall have furnished to the Representatives a
certificate, dated such Delivery Date, of (1) its Chairman of the Board,
its President or a Vice President and (2) its chief financial officer
stating that:
1. The representations and warranties of the Company in
Section 1 are true and correct in all material respects as of such Delivery
Date with the same force and effect as though expressly made as of such
Delivery Date; the Company has complied with all its agreements contained
herein to be compiled with by the Company at or prior to such Delivery
Date; and the conditions set forth in Sections 9(a) and 9(l) have been
fulfilled; and
2. They have carefully examined the Registration Statement and
the Prospectus and, to the best of their knowledge, (A) as of the Effective
Date, the Registration Statement and the Prospectus did not include any
untrue statement of a material fact and did not omit to state a material
fact required to be stated therein or necessary to make the statements
therein not misleading, and (B) since the Effective Date no event has
occurred which should have been set forth but has not been so set forth in
a supplement or amendment to the Registration Statement or the Prospectus.
(k) Each Selling Stockholder shall have furnished to the
Representatives a certificate, dated such Delivery Date, signed by, or on
behalf of, such Selling Stockholder stating that the representations and
warranties of such Selling Stockholder contained herein are true and
correct in all material respects as of such Delivery Date with the same
force and effect as though expressly made as of such Delivery Date and that
such Selling Stockholder has complied with all agreements contained herein
to be complied with by such Selling Stockholder at or prior to such
Delivery Date.
(l) (1) Neither the Company nor any of its subsidiaries shall
have sustained since the date of the latest audited financial statements
included or incorporated by reference in the Prospectus any loss or
interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor dispute or
court or governmental action, order or decree, otherwise than as set forth
or contemplated in the Prospectus, or (2) since such date there shall not
have been any change in the capital stock or
<PAGE>
25
long-term debt or a decrease in the net current assets or net assets of the
Company or any of its subsidiaries or any change, or any development
involving a prospective change, in or affecting the general affairs,
management, financial position, stockholders' equity or results of
operations of the Company and its subsidiaries, otherwise than as set forth
or contemplated in the Prospectus, the effect of which, in any such case
described in clause (1) or (2), is, in the judgment of the Representatives,
so material and adverse as to make it impracticable or inadvisable to
proceed with the public offering or the delivery of the Stock being
delivered on such Delivery Date on the terms and in the manner contemplated
in the Prospectus.
(m) Subsequent to the execution and delivery of this Agreement
there shall not have occurred any of the following: (1) trading in
securities generally on the New York Stock Exchange or the American Stock
Exchange or in the over-the-counter market, or trading in any securities of
the Company on any exchange or in the over-the-counter market, shall have
been suspended or minimum prices shall have been established on any such
exchange or such market by the Commission, by such exchange or by any other
regulatory body or governmental authority having jurisdiction, (2) a
banking moratorium shall have been declared by Federal or state
authorities, (3) the United States shall have become engaged in
hostilities, there shall have been an escalation in hostilities involving
the United States or there shall have been a declaration of a national
emergency or war by the United States or (4) there shall have occurred such
a material adverse change in general economic, political or financial
conditions (or the effect of international conditions on the financial
markets in the United States shall be such) as to make it, in the judgment
of a majority in interest of the several U.S. Underwriters, impracticable
or inadvisable to proceed with the public offering or delivery of the Stock
being delivered on such Delivery Date on the terms and in the manner
contemplated in the Prospectus.
(n) The closing under the International Underwriting Agreement
shall have occurred concurrently with the closing hereunder on the First
Delivery Date.
All opinions, letters, evidence and certificates mentioned above or
elsewhere in this Agreement shall be deemed to be in compliance with the
provisions hereof only if they are in form and substance reasonably
satisfactory to counsel for the U.S. Underwriters.
10 INDEMNIFICATION AND CONTRIBUTION.
(a) The Company shall indemnify and hold harmless each Selling
Stockholder and each U.S. Underwriter, their respective officers, trustees
and employees and each person, if any, who controls any Selling Stockholder
or U.S. Underwriter within the meaning of the Securities Act, from and
against any loss, claim, damage or liability, joint or several, or any
action in respect thereof
<PAGE>
26
(including, but not limited to, any loss, claim, damage, liability or
action relating to purchases and sales of Stock), to which that Selling
Stockholder or U.S. Underwriter, officer, trustee, employee or controlling
person may become subject, under the Securities Act or otherwise, insofar
as such loss, claim, damage, liability or action arises out of, or is based
upon, (i) any untrue statement or alleged untrue statement of a material
fact contained (A) in any Preliminary Prospectus, the Registration
Statement or the Prospectus or in any amendment or supplement thereto or
(B) in any Blue Sky Application, (ii) the omission or alleged omission to
state in any Preliminary Prospectus, the Registration Statement or the
Prospectus, or in any amendment or supplement thereto, or in any Blue Sky
Application, any material fact required to be stated therein or necessary
to make the statements therein not misleading or (iii) any act or failure
to act or any alleged act or failure to act by any Selling Stockholder or
U.S. Underwriter in connection with, or relating in any manner to, the
Stock or the offering contemplated hereby, and which is included as part of
or referred to in any loss, claim, damage, liability or action arising out
of or based upon matters covered by clause (i) or (ii) above (PROVIDED that
the Company shall not be liable under this clause (iii) to the extent that
it is determined in a final judgment by a court of competent jurisdiction
that such loss, claim, damage, liability or action resulted directly from
any such acts or failures to act undertaken or omitted to be taken by such
Selling Stockholder or U.S. Underwriter through its gross negligence or
willful misconduct), and shall reimburse each Selling Stockholder and each
U.S. Underwriter and each such officer, trustee, employee or controlling
person promptly upon receipt of invoices from such Selling Stockholder or
U.S. Underwriters for any legal or other expenses reasonably incurred by
that Selling Stockholder, U.S. Underwriter, officer, trustee, employee or
controlling person in connection with investigating or defending or
preparing to defend against any such loss, claim, damage, liability or
action as such expenses are incurred; PROVIDED, HOWEVER, that the Company
shall not be liable in any such case to the extent that any such loss,
claim, damage, liability or action arises out of, or is based upon, any
untrue statement or alleged untrue statement or omission or alleged
omission made in any Preliminary Prospectus, the Registration Statement or
the Prospectus, or in any such amendment or supplement or in any Blue Sky
Applications, in reliance upon and in conformity with written information
concerning such Selling Stockholder or U.S. Underwriter furnished to the
Company by such Selling Stockholder or through the Representatives by or on
behalf of any U.S. Underwriter specifically for inclusion therein which
information consists solely of the information specified in Sections 10(f)
and 10(g); and PROVIDED FURTHER that as to any Preliminary Prospectus this
indemnity agreement shall not inure to the benefit of any U.S. Underwriter,
its officers or employees or any person controlling that U.S. Underwriter
on account of any loss, claim, damage, liability or action arising from the
sale of Stock to any person by that U.S. Underwriter if that U.S.
Underwriter failed to send or give a copy of the Prospectus, as the same
may be amended or supplemented, to that person within the time required by
the Securities Act, and the untrue statement
<PAGE>
27
or alleged untrue statement of any material fact or omission or alleged
omission to state a material fact in such Preliminary Prospectus was
corrected in the Prospectus, unless such failure resulted from
non-compliance by the Company with Section 6(c). For purposes of the last
provision to the immediately preceding sentence, the term "Prospectus"
shall not be deemed to include the documents incorporated therein by
reference, and no U.S. Underwriter shall be obligated to send or give any
supplement or amendment to any document incorporated by reference in any
Preliminary Prospectus or the Prospectus to any person other than a person
to whom such U.S. Underwriter had delivered such incorporated document or
documents in response to a written request therefor. The foregoing
indemnity agreement is in addition to any liability which the Company may
otherwise have to any U.S. Underwriter, any Selling Stockholder or to
any officer, trustee, employee or controlling person of that U.S.
Underwriter or Selling Stockholder.
(b) Each Selling Stockholder severally and not jointly shall
indemnify and hold harmless the Company and each U.S. Underwriter from and
against any loss, claim, damage or liability, joint or several, or any
action in respect thereof, to which the Company or such U.S. Underwriter
may become subject, under the Securities Act or otherwise, insofar as such
loss, claim, damage, liability or action arises out of, or is based upon,
(i) any untrue statement or alleged untrue statement of a material fact
contained (A) in any Preliminary Prospectus, the Registration Statement or
the Prospectus or in any amendment or supplement thereto or (B) in any Blue
Sky Application, or (ii) the omission or alleged omission to state in any
Preliminary Prospectus, the Registration Statement or the Prospectus, or in
any amendment or supplement thereto, or in any Blue Sky Application, any
material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading and shall reimburse the Company or such Underwriter
promptly after receipt of invoices from the Company or such Underwriter for
any legal or other expenses as reasonably incurred by the Company or such
Underwriter in connection with investigating, preparing to defend or
defending against or appearing as a third-party witness in connection with
any such loss, claim, damage, liability or action notwithstanding the
possibility that payments for such expenses might later be held to be
improper, in which case such payments shall be promptly refunded; PROVIDED,
HOWEVER, that such indemnification or reimbursement shall be available in
each such case to the extent, but only to the extent, that such untrue
statement or alleged untrue statement or omission or alleged omission was
made in reliance upon and in conformity with written information furnished
to the Company or such U.S. Underwriter by or on behalf of and concerning
the Selling Stockholder from whom such indemnification is sought
specifically for use in the preparation thereof; PROVIDED, FURTHER, that no
Selling Stockholder shall be liable pursuant to this Section 10(b) with
respect to any untrue statement or alleged untrue statement or omission or
alleged omission in any Preliminary Prospectus which is corrected in a
Prospectus if the person asserting such loss, claim, damage or
<PAGE>
28
liability purchased Stock from a U.S. Underwriter but was not sent or given
a copy of a Prospectus at or prior to the written confirmation of the sale
of such Stock to such person; and PROVIDED, FURTHER, that the aggregate
amount of all such indemnification or reimbursement payable by any Selling
Stockholder pursuant to this Agreement and the International U.S.
Underwriting Agreement shall in no case exceed the net proceeds to such
Selling Stockholder from the sale of the Stock.
(c) Each U.S. Underwriter, severally and not jointly, shall
indemnify and hold harmless the Company and each Selling Stockholder, their
officers and employees, each of their directors, trustees and each person,
if any, who controls the Company and each Selling Stockholder within the
meaning of the Securities Act, from and against any loss, claim, damage or
liability, joint or several, or any action in respect thereof, to which the
Company or a Selling Stockholder or any such director, trustee, officer or
controlling person may become subject, under the Securities Act or
otherwise, insofar as such loss, claim, damage, liability or action arises
out of, or is based upon, (i) any untrue statement or alleged untrue
statement of a material fact contained (A) in any Preliminary Prospectus,
the Registration Statement or the Prospectus or in any amendment or
supplement thereto or (B) in any Blue Sky Application or (ii) the omission
or alleged omission to state in any Preliminary Prospectus, the
Registration Statement or the Prospectus, or in any amendment or supplement
thereto, or in any Blue Sky Application, any material fact required to be
stated therein or necessary to make the statements therein not misleading,
but in each case only to the extent that the untrue statement or alleged
untrue statement or omission or alleged omission was made in reliance upon
and in conformity with written information concerning such U.S. Underwriter
furnished to the Company through the Representatives by or on behalf of
that U.S. Underwriter specifically for inclusion therein, and shall
reimburse the Company, the Selling Stockholders and any such director,
trustee, officer or controlling person for any legal or other expenses
reasonably incurred by the Company, the Selling Stockholders or any such
director, trustee, officer or controlling person in connection with
investigating or defending or preparing to defend against any such loss,
claim, damage, liability or action as such expenses are incurred. The
foregoing indemnity agreement is in addition to any liability which any
U.S. Underwriter may otherwise have to the Company, the Selling
Stockholders or any such director, trustee, officer, employee or
controlling person.
(d) Promptly after receipt by an indemnified party under this
Section 10 of notice of any claim or the commencement of any action, the
indemnified party shall, if a claim in respect thereof is to be made
against the indemnifying party under this Section 10, notify the
indemnifying party in writing of the claim or the commencement of that
action; PROVIDED, HOWEVER, that the failure to notify the indemnifying
party shall not relieve it from any liability which it may have under this
Section 10 except to the extent it has been
<PAGE>
29
actually prejudiced by such failure and, PROVIDED FURTHER, that the failure
to notify the indemnifying party shall not relieve it from any liability
which it may have to an indemnified party otherwise than under this
Section 10. If any such claim or action shall be brought against an
indemnified party, and it shall notify the indemnifying party thereof, the
indemnifying party shall be entitled to participate therein and, to the
extent that it wishes, jointly with any other similarly notified
indemnifying party, to assume the defense thereof with counsel reasonably
satisfactory to the indemnified party. After notice from the indemnifying
party to the indemnified party of its election to assume the defense of
such claim or action, the indemnifying party shall not be liable to the
indemnified party under this Section 10 for any legal or other expenses
subsequently incurred by the indemnified party in connection with the
defense thereof other than reasonable costs of investigation; PROVIDED,
HOWEVER, that the Representatives shall have the right to employ counsel to
represent jointly the Representatives and those other U.S. Underwriters and
their respective officers, employees and controlling persons who may be
subject to liability arising out of any claim in respect of which indemnity
may be sought by the U.S. Underwriters against the Company or any Selling
Stockholder under this Section 10 if, in the reasonable judgment of the
Representatives, a conflict of interest between the Company or such Selling
Stockholder, on the one hand, and the U.S. Underwriters, on the other hand,
exists or there may be one or more legal defenses available to the U.S.
Underwriters that are different or additional to those available to the
Company or the Selling Stockholder, and in that event the fees and expenses
of such separate counsel shall be paid by the Company and such Selling
Stockholder. No indemnifying party shall (i) without the prior written
consent of the indemnified parties (which consent shall not be unreasonably
withheld), settle or compromise or consent to the entry of any judgment
with respect to any pending or threatened claim, action, suit or proceeding
in respect of which indemnification or contribution may be sought hereunder
(whether or not the indemnified parties are actual or potential parties to
such claim or action) unless such settlement, compromise or consent
includes an unconditional release of each indemnified party from all
liability arising out of such claim, action, suit or proceeding, or (ii) be
liable for any settlement of any such action effected without its written
consent (which consent shall not be unreasonably withheld), but if settled
with the consent of the indemnifying party or if there be a final judgment
of the plaintiff in any such action, the indemnifying party agrees to
indemnify and hold harmless any indemnified party from and against any loss
or liability by reason of such settlement or judgment.
(e) If the indemnification provided for in this Section 10 shall
for any reason be unavailable to or insufficient to hold harmless an
indemnified party under Section 10(a) or 10(b) or 10(c) in respect of any
loss, claim, damage or liability, or any action in respect thereof,
referred to therein, then each indemnifying party shall, in lieu of
indemnifying such indemnified party, contribute to the amount paid or
payable by such indemnified party as a result of such loss, claim, damage
or liability, or action in respect thereof, (i) in such
<PAGE>
30
proportion as shall be appropriate to reflect the relative benefits
received by the Company and the Selling Stockholders on the one hand and
the U.S. Underwriters on the other from the offering of the Stock or (ii)
if the allocation provided by clause (i) above is not permitted by
applicable law, in such proportion as shall be appropriate to reflect not
only the relative benefits referred to in clause (i) above but also the
relative fault of the Company and the Selling Stockholders on the one hand
and the U.S. Underwriters on the other with respect to the statements or
omissions which resulted in such loss, claim, damage or liability, or
action in respect thereof, as well as any other relevant equitable
considerations The relative benefits received by the Company and the
Selling Stockholders on the one hand and the U.S. Underwriters on the other
with respect to such offering shall be deemed to be in the same proportion
as the total net proceeds from the offering of the Stock purchased under
this Agreement (before deducting expenses) received by the Company and the
Selling Stockholders, on the one hand, and the total underwriting discounts
and commissions received by the U.S. Underwriters with respect to the
shares of the Stock purchased under this Agreement, on the other hand, bear
to the total gross proceeds from the offering of the shares of the Stock
under this Agreement, in each case as set forth in the table on the cover
page of the Prospectus. The relative fault shall be determined by
reference to whether the 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, a Selling Stockholder or the U.S.
Underwriters, the intent of the parties and their relative knowledge,
access to information and opportunity to correct or prevent such statement
or omission. The Company, the Selling Stockholders and the U.S.
Underwriters agree that it would not be just and equitable if contributions
pursuant to this Section 10(e) were to be 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 into account the
equitable considerations referred to herein. The amount paid or payable by
an indemnified party as a result of the loss, claim, damage or liability,
or action in respect thereof, referred to above in this Section 10 shall be
deemed to include, for purposes of this Section 10(e), any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this Section 10(e), no U.S. Underwriter shall be required to
contribute any amount in excess of the amount by which the total price at
which the Stock underwritten by it and distributed to the public was
offered to the public exceeds the amount of any damages which such U.S.
Underwriter has otherwise paid or become liable to pay by reason of any
untrue or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Securities Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. The
U.S. Underwriters' obligations to contribute as provided in this
Section 10(e) are several in proportion to their respective underwriting
obligations and not joint.
<PAGE>
31
(f) Each of the Selling Stockholders severally confirm that the
statements with respect to the number of shares of Common Stock
beneficially owned by such Selling Stockholder prior to the public offering
of the Stock, the number of shares to be sold by such Selling Stockholder
in the public offering and the number of shares of Common Stock to be
beneficially owned by such Selling Stockholder appearing under the caption
"Selling Stockholders" in the Prospectus are correct and constitute the
only information concerning such Selling Stockholder furnished in writing
to the Company by or on behalf of such Selling Stockholder specifically for
inclusion in the Registration Statement and the Prospectus.
(g) The U.S. Underwriters severally confirm that the statements
with respect to the public offering of the Stock by the U.S. Underwriters
set forth on the cover page of, and the legend concerning over-allotments
on the inside front cover page of, the Prospectus Supplement, the
concession and reallowance figures appearing in the sixth paragraph under
the caption "Underwriting" and the seventh, ninth, tenth, thirteenth,
fourteenth, fifteenth, eighteenth, and twentieth paragraphs appearing
under the caption "Underwriting" in the Prospectus are correct and
constitute the only information concerning such U.S. Underwriters
furnished in writing to the Company by or on behalf of the U.S.
Underwriters specifically for inclusion in the Registration Statement and
the Prospectus.
11. DEFAULTING U.S. UNDERWRITERS.
If, on either Delivery Date, any U.S. Underwriter defaults in the
performance of its obligations under this Agreement, the remaining
non-defaulting U.S. Underwriters shall be obligated to purchase the Stock which
the defaulting U.S. Underwriter agreed but failed to purchase on such Delivery
Date in the respective proportions which the number of shares of the Firm Stock
set opposite the name of each remaining non-defaulting U.S. Underwriter in
Schedule 1 hereto bears to the total number of shares of the Firm Stock set
opposite the names of all the remaining non-defaulting U.S. Underwriters in
Schedule 1 hereto; PROVIDED, HOWEVER, that the remaining non-defaulting U.S.
Underwriters shall not be obligated to purchase any of the Stock on such
Delivery Date if the total number of shares of the Stock which the defaulting
U.S. Underwriter or U.S. Underwriters agreed but failed to purchase on such date
exceeds 9.09% of the total number of shares of the Stock to be purchased on such
Delivery Date, and any remaining non-defaulting U.S. Underwriter shall not be
obligated to purchase more than 110% of the number of shares of the Stock which
it agreed to purchase on such Delivery Date pursuant to the terms of Section 3.
If the foregoing maximums are exceeded, the remaining non-defaulting U.S.
Underwriters, or those other underwriters satisfactory to the Representatives
who so agree, shall have the right, but shall not be obligated, to purchase, in
such proportion as may be agreed upon among them, all the Stock to be purchased
on such Delivery Date. If the remaining U.S. Underwriters or other underwriters
satisfactory to the Representatives do not elect to purchase the shares which
the defaulting U.S. Underwriter or U.S. Underwriters
<PAGE>
32
agreed but failed to purchase on such Delivery Date, this Agreement (or, with
respect to the Second Delivery Date, the obligation of the U.S. Underwriters to
purchase, and of the Selling Stockholders to sell, the Option Stock) shall
terminate without liability on the part of any non-defaulting U.S. Underwriter
or the Company or any Selling Stockholder, except that the Company will continue
to be liable for the payment of expenses to the extent set forth in Sections 8
and 13. As used in this Agreement, the term "U.S. Underwriter" includes, for
all purposes of this Agreement unless the context requires otherwise, any party
not listed in Schedule 1 hereto who, pursuant to this Section 11, purchases
Stock which a defaulting U.S. Underwriter agreed but failed to purchase.
Nothing contained herein shall relieve a defaulting U.S. Underwriter
of any liability it may have to the Company and the Selling Stockholders for
damages caused by its default. If other underwriters are obligated or agree to
purchase the Stock of a defaulting or withdrawing U.S. Underwriter, either the
Representatives or the Company may postpone the Delivery Date for up to seven
full business days in order to effect any changes that in the opinion of counsel
for the Company or counsel for the U.S. Underwriters may be necessary in the
Registration Statement, the Prospectus or in any other document or arrangement.
12. TERMINATION. The obligations of the U.S. Underwriters hereunder
may be terminated by the Representatives by notice given to and received by the
Company and each of the Selling Stockholders prior to delivery of and payment
for the Firm Stock if, prior to that time, any of the events described in
Sections 9(l) or 9(m) shall have occurred or if the U.S. Underwriters shall
decline to purchase the Stock for any reason permitted under this Agreement.
13. REIMBURSEMENT OF U.S. UNDERWRITERS' EXPENSES. If this Agreement
is terminated pursuant to Section 11 by reason of the default of one or more
U.S. Underwriters, neither the Company nor any Selling Stockholder shall be
obligated to reimburse any defaulting U.S. Underwriter on account of those
expenses. This provision shall not affect the allocation of such expenses
between the Company and the Selling Stockholders pursuant to the Registration
Rights Agreement.
14. NOTICES, ETC. All statements, requests, notices and agreements
hereunder shall be in writing, and:
(a) if to the U.S. Underwriters, shall be delivered or sent by
mail, telex or facsimile transmission to Lehman Brothers Inc., Three World
Financial Center, New York, New York 10285, Attention: Syndicate
Department (Fax: 212-526-6588), with a copy, in the case of any notice
pursuant to Section 10(c), to the Director of Litigation, Office of the
General Counsel, Lehman Brothers Inc., Three World Financial Center, 10th
Floor, New York, New York 10285;
<PAGE>
33
(b) if to the Company, shall be delivered or sent by mail, telex
or facsimile transmission to the address of the Company set forth in the
Registration Statement, Attention: General Counsel (Fax: 813-871-4430);
and
(c) if to a Selling Stockholder, shall be delivered or sent by
mail, telex or facsimile transmission to such Selling Stockholder at the
address or facsimile number set forth on Schedule 2 hereto;
PROVIDED, HOWEVER, that any notice to an U.S. Underwriter pursuant to
Section 10(d) shall be delivered or sent by mail, telex or facsimile
transmission to such U.S. Underwriter at its address set forth in its acceptance
telex to the Representatives, which address will be supplied to any other party
hereto by the Representatives upon request. Any such statements, requests,
notices or agreements shall take effect at the time of receipt thereof. The
Company and the Selling Stockholders shall be entitled to act and rely upon any
request, consent, notice or agreement given or made on behalf of the U.S.
Underwriters by Lehman Brothers Inc. on behalf of the Representatives.
15. PERSONS ENTITLED TO BENEFIT OF AGREEMENT. This Agreement
shall inure to the benefit of and be binding upon the U.S. Underwriters, the
Company, the Selling Stockholders, their trustees and their respective
successors. This Agreement and the terms and provisions hereof are for the
sole benefit of only those persons, except that (A) the representations,
warranties, indemnities and agreements of the Company and each of the Selling
Stockholders contained in this Agreement shall also be deemed to be for the
benefit of the person or persons, if any, who control any U.S. Underwriter or
any Selling Stockholder within the meaning of Section 15 of the Securities
Act and for the benefit of each International Manager (and controlling
persons thereof) who offers or sells any shares of Common Stock in accordance
with the terms of the Agreement Between U.S. Underwriters and International
Managers and (B) the indemnity agreement of the U.S. Underwriters contained
in Section 10(c) of this Agreement shall be deemed to be for the benefit of
directors of the Company, the officers of the Company who have signed the
Registration Statement, the Selling Stockholders, their directors and
trustees and any person controlling the Company or a Selling Stockholder
within the meaning of Section 15 of the Securities Act. Nothing in this
Agreement is intended or shall be construed to give any person, other than
the persons referred to in this Section 15, any legal or equitable right,
remedy or claim under or in respect of this Agreement or any provision
contained herein.
16. SURVIVAL. The respective indemnities, representations,
warranties and agreements of the Company, the Selling Stockholders and the U.S.
Underwriters contained in this Agreement or made by or on behalf on them,
respectively, pursuant to this Agreement, shall survive the delivery of and
payment for the Stock and shall remain in full force and effect, regardless of
any investigation made by or on behalf of any of them or any person controlling
any of them.
17. DEFINITION OF THE TERMS "BUSINESS DAY" AND "SUBSIDIARY." For
purposes of this Agreement, (a) "business day" means each Monday, Tuesday,
<PAGE>
34
Wednesday, Thursday or Friday which is not a day on which banking institutions
in New York are generally authorized or obligated by law or executive order to
close and (b) "subsidiary" has the meaning set forth in Rule 405 of the Rules
and Regulations.
18. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF NEW YORK.
19. COUNTERPARTS. This Agreement may be executed in one or more
counterparts and, if executed in more than one counterpart, the executed
counterparts shall each be deemed to be an original but all such counterparts
shall together constitute one and the same instrument.
20. HEADINGS. The headings herein are inserted for convenience of
reference only and are not intended to be part of, or to affect the meaning or
interpretation of, this Agreement.
[signature pages follow]
<PAGE>
35
If the foregoing correctly sets forth the agreement among the Company,
the Selling Stockholders and the U.S. Underwriters, please indicate your
acceptance in the space provided for that purpose below.
Very truly yours,
WALTER INDUSTRIES, INC.
By ___________________________
NAME:
TITLE:
LEHMAN BROTHERS HOLDINGS INC.
By ___________________________
NAME:
TITLE:
ASBESTOS SETTLEMENT TRUST
By ___________________________
NAME:
TITLE:
<PAGE>
36
Accepted:
LEHMAN BROTHERS INC.
DONALDSON, LUFKIN & JENRETTE SECURITIES CORPORATION
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
SMITH BARNEY INC.
ARNHOLD and S. BLEICHROEDER, INC.
For themselves and as Representatives
of the several U.S. Underwriters named
in Schedule 1 hereto
By LEHMAN BROTHERS INC.
By
------------------------------
AUTHORIZED REPRESENTATIVE
<PAGE>
37
SCHEDULE 1
U.S. UNDERWRITERS NUMBER OF SHARES
Lehman Brothers Inc.. . . . . . . . . . . . . . . . . .
Donaldson, Lufkin & Jenrette Securities Corporation . .
Merrill Lynch, Pierce, Fenner & Smith Incorporated. . .
Smith Barney Inc. . . . . . . . . . . . . . . . . . . .
Arnhold and S. Bleichroeder, Inc. . . . . . . . . . . .
__________
Total . . . . . . . . . . . . . . . . . . . . . . . . 10,000,000
----------
----------
<PAGE>
38
SCHEDULE 2
NAME AND ADDRESS OF NUMBER OF SHARES NUMBER OF SHARES
SELLING STOCKHOLDER OF FIRM STOCK OF OPTION STOCK
The Asbestos Settlement Trust . . . . 5,579,796 1,500,000
9 Burr Road
Westport, CT 06880
Attention:
Facsimile:
Lehman Brothers Holdings Inc. . . . . 4,420,204 0
Three World Financial Center
New York, NY 10285
Attention: Steven L. Berkenfeld or
Kevin R. Genirs
Facsimile: (212) 526-2198 _____________ ______________
Total . . . . . . . . . . . . . . . . . . 10,000,000 1,500,000
---------- ---------
---------- ---------
<PAGE>
39
SCHEDULE 3
Persons from whom "Lock-Up"
Letters will be Received
(In addition to the Company's
Executive Officers and Directors)
PURSUANT TO SECTION 6(H)
Channel One Associates, L.P.
JWC Associates, L.P.
JWC Associates II, L.P.
KKR Partners II, L.P.
<PAGE>
EXHIBIT 1(b)
2,000,000 SHARES
WALTER INDUSTRIES, INC.
COMMON STOCK, PAR VALUE $.01 PER SHARE
INTERNATIONAL UNDERWRITING AGREEMENT
February ___, 1998
LEHMAN BROTHERS INTERNATIONAL (EUROPE)
DONALDSON, LUFKIN & JENRETTE INTERNATIONAL
MERRILL LYNCH INTERNATIONAL
SMITH BARNEY INC.
ARNHOLD and S. BLEICHROEDER, INC.
As Lead Managers of the several
International Managers named in Schedule 1,
c/o Lehman Brothers International (Europe)
Three World Financial Center
New York, New York 10285
Dear Sirs:
Walter Industries, Inc., a Delaware corporation (the "Company"), the
Asbestos Settlement Trust (the "Settlement Trust"), Lehman Brothers
Holdings Inc. ("Lehman" and, together with the Settlement Trust, the "Selling
Stockholders") and the other holders named therein are parties to that certain
Registration Rights Agreement dated as of March 17, 1995 (the "Registration
Rights Agreement"). Pursuant to the Registration Rights Agreement, the Selling
Stockholders propose to sell to the International Managers named in Schedule 1
hereto (the "International Managers") an aggregate of 2,000,000 shares (the
"Firm Stock") of the Company's common stock, par value $.01 per share (the
"Common Stock"). In addition, the Settlement Trust proposes to grant to the
International Managers an option to purchase up to an additional 300,000 shares
of the Common Stock on the terms and for the purposes set forth in Section 3
(the "Option Stock"). The Firm Stock and the Option Stock, if purchased, are
hereinafter collectively called the "Stock." This is to confirm the agreement
concerning the purchase of the Stock from the Selling Stockholders by the
International Managers.
It is understood by all parties that the Company and the Selling
Stockholders are concurrently entering into an agreement dated the date hereof
(the "U.S. Underwriting Agreement") providing for the sale by the Selling
Stockholders of 11,500,000 shares of Common Stock (including the over-allotment
option thereunder) (the "U.S. Stock") through arrangements with Lehman Brothers
Inc., Donaldson, Lufkin & Jenrette Securities Corporation, Merrill Lynch,
Pierce, Fenner & Smith Incorporated, Smith Barney Inc., and Arnhold and S.
Bleichroeder, Inc. (the "U.S. Underwriters"). The U.S. Underwriters and
<PAGE>
2
the International Managers simultaneously are entering into an agreement between
the U.S. and international underwriting syndicates (the "Agreement Between U.S.
Underwriters and International Managers") which provides for, among other
things, the transfer of shares of Common Stock between the two syndicates. Two
forms of prospectus are to be used in connection with the offering and sale of
shares of Common Stock contemplated by the foregoing, one relating to the Stock
and the other relating to the U.S. Stock. The latter form of prospectus will be
identical to the former except for certain substitute pages as included in the
registration statement and amendments thereto referred to below. Except as used
in Sections 3, 4, 5, 11 and 12 herein, and except as the context may otherwise
require, references herein to the Stock shall include all the shares of the
Selling Stockholders which may be sold pursuant to either this Agreement or the
U.S. Underwriting Agreement, and references herein to any prospectus whether in
preliminary or final form, and whether as amended or supplemented, shall include
both the U.S. and the international versions thereof.
1. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE COMPANY. The
Company represents, warrants and agrees that:
(a) A registration statement on Form S-3, as amended by
Post-Effective Amendment No. 8 thereto, with respect to the Stock has
(1) been prepared by the Company in conformity with the requirements of the
United States Securities Act of 1933 (the "Securities Act") and the rules
and regulations (the "Rules and Regulations") of the United States
Securities and Exchange Commission (the "Commission") thereunder, (2) been
filed with the Commission under the Securities Act and (3) become effective
under the Securities Act. Copies of such registration statement and the
amendments thereto have been delivered by the Company to you as the
representatives (the "Lead Managers") of the International Managers. As
used in this Agreement, "Effective Time" means the date and the time as of
which such registration statement, or the most recent post-effective
amendment thereto, was declared effective by the Commission; "Effective
Date" means the date of the Effective Time; "Preliminary Prospectus" means
each prospectus included in such registration statement, or amendments
thereof, before it became effective under the Securities Act and any
prospectus or preliminary prospectus supplement filed with the Commission
by the Company with the consent of the Lead Managers pursuant to Rule
424(a) or Rule 424(b) of the Rules and Regulations; "Registration
Statement" means such registration statement, as amended at the Effective
Time, including any documents incorporated by reference therein at such
time and all information contained in the final prospectus and prospectus
supplement filed with the Commission pursuant to Rule 424(b) of the Rules
and Regulations in accordance with Section 6 hereof; and "Prospectus" means
such final prospectus and prospectus supplement, as filed with the
Commission pursuant to Rule 424(b) of the Rules and Regulations. Reference
made herein to any Preliminary Prospectus or to the Prospectus shall be
deemed to refer to and include any documents incorporated by reference
therein pursuant to Item 12 of Form S-3 under the Securities Act, as of the
date of such Preliminary Prospectus or the Prospectus, as the case may be,
and any reference to any amendment or
<PAGE>
3
supplement to any Preliminary Prospectus or the Prospectus shall be deemed
to refer to and include any document filed under the United States
Securities Exchange Act of 1934 (the "Exchange Act") after the date of such
Preliminary Prospectus or the Prospectus, as the case may be, and
incorporated by reference in such Preliminary Prospectus or the Prospectus,
as the case may be; and any reference to any amendment to the Registration
Statement shall be deemed to include any annual report of the Company filed
with the Commission pursuant to Section 13(a) or 15(d) of the Exchange Act
after the Effective Time that is incorporated by reference in the
Registration Statement. The Commission has not issued any order preventing
or suspending the use of any Preliminary Prospectus or Prospectus.
(b) The Registration Statement conforms, and the Prospectus and
any further amendments or supplements to the Registration Statement or the
Prospectus will, when they become effective or are filed with the
Commission, as the case may be, conform in all material respects to the
requirements of the Securities Act and the Rules and Regulations and do not
and will not, as of the applicable effective date (as to the Registration
Statement and any amendment thereto) and as of the applicable filing date
(as to the Prospectus and any amendment or supplement thereto) 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; PROVIDED that no representation or warranty is made as to
information contained in or omitted from the Registration Statement or the
Prospectus in reliance upon and in conformity with written information
furnished to the Company through the Lead Managers by or on behalf of any
International Manager specifically for inclusion therein.
(c) The documents incorporated by reference in the Prospectus,
when they were filed with the Commission conformed in all material respects
to the requirements of the Exchange Act and the rules and regulations of
the Commission thereunder, and none of such documents 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; and any further documents so filed and incorporated by
reference in the Prospectus, when such documents are filed with the
Commission will conform in all material respects to the requirements of the
Exchange Act and the rules and regulations of the Commission thereunder 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.
(d) The Company and each of its subsidiaries (as defined in
Section 17) have been duly incorporated and are validly existing as
corporations in good standing under the laws of their respective
jurisdictions of incorporation, are duly qualified to do business and are
in good standing as foreign corporations in each jurisdiction in which
their respective ownership or lease of property or the conduct of their
respective businesses requires such qualification, and have all power and
authority necessary to own or hold their respective properties and to
<PAGE>
4
conduct the businesses in which they are engaged, except where the failure
to so qualify, be in good standing or have such power would not result in
material adverse change in the financial condition, results of operations,
business or assets of the Company and its subsidiaries taken as a whole (a
"Material Adverse Effect"). None of the subsidiaries of the Company, other
than Jim Walter Homes, Inc., Mid-State Homes, Inc., United States Pipe and
Foundry Company, Inc., Jim Walter Resources, Inc. and Applied Industrial
Materials Corporation (collectively, the "Significant Subsidiaries"), is a
"significant subsidiary," as such term is defined in Rule 405 of the Rules
and Regulations.
(e) The Company has an authorized capitalization as set forth in
the Prospectus, and all of the issued shares of capital stock of the
Company have been duly and validly authorized and issued, are fully paid
and non-assessable and conform to the description thereof contained in the
Prospectus; and all of the issued shares of capital stock of each
subsidiary of the Company have been duly and validly authorized and issued
and are fully paid and non-assessable and (except for directors' qualifying
shares) are owned directly or indirectly by the Company, free and clear of
all liens, encumbrances, equities or claims, except as disclosed in the
Prospectus.
(f) The shares of the Stock to be sold by the Selling
Stockholders to the International Managers hereunder and under the U.S.
Underwriting Agreement have been duly and validly authorized, are duly and
validly issued, fully paid and non-assessable; and the Stock will conform
to the description thereof contained in the Prospectus.
(g) This Agreement has been duly authorized, executed and
delivered by the Company.
(h) The execution, delivery and performance of this Agreement
and the U.S. Underwriting Agreement by the Company and the consummation of
the transactions contemplated hereby and thereby will not conflict with or
result in a breach or violation of any of the terms or provisions of, or
constitute a default under, any indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument to which the Company or any of
its subsidiaries is a party or by which the Company or any of its
subsidiaries is bound or to which any of the property or assets of the
Company or any of its subsidiaries is subject, except for such conflicts,
breaches, violations or defaults which would not result in a Material
Adverse Effect or materially impair the ability of the Company to
consummate the transactions contemplated hereby; nor will such actions
result in any violation of the provisions of the charter or by-laws of the
Company or any of its subsidiaries or any statute or any order, rule or
regulation of any court or governmental agency or body having jurisdiction
over the Company or any of its subsidiaries or any of their properties or
assets; and except for the registration of the Stock under the Securities
Act and such consents, approvals, authorizations, registrations or
qualifications as may be
<PAGE>
5
required under the Exchange Act and applicable state or foreign securities
laws in connection with the purchase and distribution of the Stock by the
U.S. Underwriters and the International Managers, no consent, approval,
authorization or order of, or filing or registration with, any such court
or governmental agency or body is required for the execution, delivery and
performance of this Agreement, or the U.S. Underwriting Agreement by the
Company and the consummation of the transactions contemplated hereby and
thereby.
(i) Except as disclosed in the Prospectus, there are no
contracts, agreements or understandings between the Company and any person
granting such person the right (other than rights which have been waived or
satisfied) to require the Company to file a registration statement under
the Securities Act with respect to any securities of the Company owned or
to be owned by such person or to require the Company to include such
securities in the securities registered pursuant to the Registration
Statement or in any securities being registered pursuant to any other
registration statement filed by the Company under the Securities Act.
(j) Except as disclosed in the Prospectus, the Company has not
sold or issued any shares of Common Stock during the six-month period
preceding the date of the Prospectus, including any sales pursuant to Rule
144A under, or Regulations D or S of, the Securities Act, other than shares
issued pursuant to employee benefit plans, qualified stock option plans or
other employee compensation plans or pursuant to outstanding options,
rights or warrants.
(k) The financial statements (including the related notes and
supporting schedules) filed as part of the Registration Statement or
included or incorporated by reference in the Prospectus present fairly the
financial condition and results of operations of the entities purported to
be shown thereby, at the dates and for the periods indicated, and have been
prepared in conformity with generally accepted accounting principles
applied on a consistent basis throughout the periods involved.
(l) Price Waterhouse LLP, who have certified certain financial
statements of the Company, whose report appears in the Prospectus or is
incorporated by reference therein and who have delivered an initial letter
referred to in Section 9(h) hereof, are independent public accountants as
required by the Securities Act and the Rules and Regulations; and Arthur
Andersen LLP, who have certified certain financial statements of Applied
Industrial Materials Corporation, whose report appears in the Prospectus or
is incorporated by reference therein and who have delivered an initial
letter referred to in Section 9(h) hereof, were independent accountants as
required by the Securities Act and the Rules and Regulations during the
periods covered by the financial statements on which they reported and
which are contained or incorporated in the Prospectus.
(m) The Company and each of its subsidiaries have good and
marketable title in fee simple to all real property material to the Company
and its subsidiaries taken as a whole and good and marketable title to all
personal property
<PAGE>
6
material to the Company and its subsidiaries taken as a whole owned by
them, in each case free and clear of all liens, encumbrances and defects,
except such as are described in the Prospectus or such as do not materially
affect the value of such property and do not materially interfere with the
use made and proposed to be made of such property by the Company and its
subsidiaries; and all real property and buildings held under lease by the
Company and its subsidiaries which are material to the Company and its
subsidiaries taken as a whole are held by them under valid, subsisting and
enforceable leases, with such exceptions as are not material and do not
interfere with the use made and proposed to be made of such property and
buildings by the Company and its subsidiaries.
(n) The Company and each of its subsidiaries carry, or are
covered by, insurance in such amounts and covering such risks as is
adequate for the conduct of their respective businesses and the value of
their respective properties.
(o) The Company and its subsidiaries own or possess adequate
rights to use all patents, patent applications, trademarks, service marks,
trade names, trademark registrations, service mark registrations,
copyrights and licenses necessary for the conduct of their respective
businesses and have no reason to believe that the conduct of their
respective businesses will conflict with, and have not received any notice
of any claim of conflict with, any such rights of others, except for any
such failure to own or possess or conflict which would not result in a
Material Adverse Effect.
(p) Except as disclosed in the Prospectus, there are no legal or
governmental proceedings pending to which the Company or any of its
subsidiaries is a party or of which any property or assets of the Company
or any of its subsidiaries is the subject which could reasonable be
expected to be determined so as to have a Material Adverse Effect; and, to
the best of the Company's knowledge, no such proceedings are threatened by
governmental authorities or threatened by others.
(q) The conditions for use of Form S-3, as set forth in the
General Instructions thereto, have been satisfied.
(r) There are no contracts or other documents which are required
to be described in the Prospectus or filed as exhibits to the Registration
Statement by the Securities Act or by the Rules and Regulations which have
not been described in the Prospectus or filed as exhibits to the
Registration Statement or incorporated therein by reference as permitted by
the Rules and Regulations.
(s) Except as disclosed in the Prospectus, no labor disturbance
by the employees of the Company exists or, to the knowledge of the Company,
is imminent, in either case which could reasonably be expected to have a
Material Adverse Effect.
<PAGE>
7
(t) The Company is in compliance in all material respects with
all presently applicable provisions of the Employee Retirement Income
Security Act of 1974, as amended, including the regulations and published
interpretations thereunder ("ERISA"), except where the failure to so comply
would not reasonably be expected to result in a Material Adverse Effect; no
"reportable event" (as defined in ERISA) (other than one as to which the
notice requirement is waived) has occurred with respect to any "pension
plan" (as defined in ERISA) for which the Company would have any material
liability; the Company has not incurred and does not expect to incur
liability under (i) Title IV of ERISA with respect to termination of, or
withdrawal from, any "pension plan" or (ii) Sections 412 or 4971 of the
Internal Revenue Code of 1986, as amended, including the regulations and
published interpretations thereunder (the "Code"), which could reasonably
be expected to result in a Material Adverse Effect; and each "pension plan"
for which the Company would have any liability that is intended to be
qualified under Section 401(a) of the Code has received a favorable
determination letter from the Internal Revenue Service that it is so
qualified in all material respects and, to the best of the Company's
knowledge, nothing has occurred, whether by action or by failure to act,
which would reasonably be expected to cause the loss of such qualification.
(u) Except as disclosed in the Prospectus, (i) the Company and
its subsidiaries have filed all federal, state and local income and
franchise tax returns required to be filed through the date hereof, (ii)
the Company has paid all taxes due thereon, and (iii) no tax deficiency has
been determined adversely to the Company or any of its subsidiaries which
has had (nor does the Company have any knowledge of any tax deficiency
which, if determined adversely to the Company or any of its subsidiaries,
might have) a Material Adverse Effect.
(v) Since the date as of which information is given in the
Prospectus through the date hereof, and except as may otherwise be
disclosed in the Prospectus, the Company has not (i) issued or granted any
securities, other than securities issued or granted pursuant to employee
benefit plans, qualified stock option plans or other employee compensation
plans or pursuant to outstanding options, rights or warrants, (ii) incurred
any liability or obligation, direct or contingent, which is material to the
Company and its subsidiaries taken as a whole, other than liabilities and
obligations which were incurred in the ordinary course of business,
(iii) entered into any transaction not in the ordinary course of business
which is material to the Company and its subsidiaries taken as a whole,
(iv) declared or paid any dividend on its capital stock or (v) been the
subject of an adverse decision or judgement in the nature of litigation or
arbitration which could reasonably be expected to have a Material Adverse
Effect.
(w) Neither the Company nor any of its subsidiaries (1) is in
violation of its charter or by-laws, (2) is in default in any material
respect, and no event has occurred which, with notice or lapse of time or
both, would constitute such a default, in the due performance or observance
of any term, covenant or condition contained in any material indenture,
mortgage, deed of trust, loan
<PAGE>
8
agreement or other agreement or instrument to which it is a party or by
which it is bound or to which any of its properties or assets is subject,
except for any default which would not have a Material Adverse Effect,
(3) is in violation in any material respect of any law, ordinance,
governmental rule, regulation or court decree to which it or its property
or assets may be subject or (4) has failed to obtain any material license,
permit, consent, order, certificate, franchise or other governmental
authorization, approval or permit necessary to the ownership of its
property or to the conduct of its business, except for such failures that
would not result in a Material Adverse Effect.
(x) Except as disclosed in the Prospectus, there has been no
storage, disposal, generation, manufacture, refinement, transportation,
handling or treatment of toxic wastes, medical wastes, hazardous wastes or
hazardous substances by the Company or any of its subsidiaries (or, to the
knowledge of the Company, any of their predecessors in interest) at, upon
or from any of the property now or previously owned or leased by the
Company or its subsidiaries in violation of any applicable law, ordinance,
rule, regulation, order, judgment, decree or permit or which would require
remedial action under any applicable law, ordinance, rule, regulation,
order, judgment, decree or permit, except for any violation or remedial
action which would not have, or could not be reasonably likely to have,
singularly or in the aggregate with all such violations and remedial
actions, a material adverse effect on the general affairs, management,
financial position, stockholders' equity or results of operations of the
Company and its subsidiaries; there has been no material spill, discharge,
leak, emission, injection, escape, dumping or release of any kind onto such
property or into the environment surrounding such property of any toxic
wastes, medical wastes, solid wastes, hazardous wastes or hazardous
substances due to or caused by the Company or any of its subsidiaries or
with respect to which the Company or any of its subsidiaries have
knowledge, except for any such spill, discharge, leak, emission, injection,
escape, dumping or release which would not have or would not be reasonably
likely to have, singularly or in the aggregate with all such spills,
discharges, leaks, emissions, injections, escapes, dumpings and releases, a
material adverse effect on the general affairs, management, financial
position, stockholders' equity or results of operations of the Company and
its subsidiaries; and the terms "hazardous wastes", "toxic wastes",
"hazardous substances" and "medical wastes" shall have the meanings
specified in any applicable local, state, federal and foreign laws or
regulations with respect to environmental protection.
(y) Neither the Company nor any of its subsidiaries is an
"investment company" within the meaning of such term under the United
States Investment Company Act of 1940 and the rules and regulations of the
Commission thereunder.
<PAGE>
9
2. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE SELLING
STOCKHOLDERS. Each of the Selling Stockholders represents, warrants and agrees
that:
(a) The Selling Stockholder has, and immediately prior to each
Delivery Date (as defined in Section 5 hereof) the Selling Stockholder will
have good and valid title to the shares of Stock to be sold by the Selling
Stockholder hereunder and under the U.S. Underwriting Agreement on such
date, free and clear of all liens, encumbrances, equities or claims; and
upon delivery of such shares and payment therefor pursuant hereto and
thereto, good and valid title to such shares, free and clear of all liens,
encumbrances, equities or claims, will pass to the several U.S.
Underwriters and the International Managers.
(b) The Selling Stockholder has placed in custody with Harris
Trust and Savings Bank, as custodian (the "Custodian"), for delivery under
this Agreement and the U.S. Underwriting Agreement, certificates in
negotiable form (with signature guaranteed by a commercial bank or trust
company having an office or correspondent in the United States or a member
firm of the New York or American Stock Exchanges) representing the shares
of Stock to be sold by the Selling Stockholder hereunder and thereunder.
(c) The Selling Stockholder has duly and irrevocably executed
and delivered a Power of Attorney and Custody Agreement (the "Power of
Attorney and Custody Agreement" and, together with all other similar
agreements executed by the other Selling Stockholders, the "Power of
Attorney and Custody Agreements") regarding custody arrangements referred
to in the immediately preceeding paragraph and appointing the Custodian or
one or more other persons, as attorneys-in-fact, with full power of
substitution, and with full authority (exercisable by any one or more of
them) to execute and deliver this Agreement and the U.S. Underwriting
Agreement and to take such other action as may be necessary or desirable
to carry out the provisions hereof or thereof on behalf of the Selling
Stockholder.
(d) The Selling Stockholder has been duly organized and is
validly existing in good standing under the laws of its jurisdiction of
organization and has full right, power and authority to enter into this
Agreement, the U.S. Underwriting Agreement and the Power of Attorney and
Custody Agreement; the execution, delivery and performance of this
Agreement, the U.S. Underwriting Agreement and the Power of Attorney and
Custody Agreement by the Selling Stockholder and the consummation by the
Selling Stockholder of the transactions contemplated hereby and thereby
will not conflict with or result in a breach or violation in any material
respect of any of the terms or provisions of, or constitute a default
under, any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which the Selling Stockholder is a party or by
which the Selling Stockholder is bound or to which any of the property or
assets of the Selling Stockholder is subject, nor will such actions result
in any violation in any material
<PAGE>
10
respect of the provisions of the charter, by-laws, trust instrument or
other organizing instrument (as applicable) of the Selling Stockholder or
any statute or any order, rule or regulation of any court or governmental
agency or body having jurisdiction over the Selling Stockholder or the
property or assets of the Selling Stockholder; and, except for the
registration of the Stock under the Securities Act and such consents,
approvals, authorizations, filings, registrations or qualifications as may
be required under the Exchange Act (including filings pursuant to
Sections 13 and 16 of the Exchange Act) and applicable state or foreign
securities laws in connection with the purchase and distribution of the
Stock by the U.S. Underwriters and the International Managers, no consent,
approval, authorization or order of, or filing or registration with, any
such court or governmental agency or body is required for the execution,
delivery and performance of this Agreement or the U.S. Underwriting
Agreement, by the Selling Stockholder and the consummation by the Selling
Stockholder of the transactions contemplated hereby and thereby.
(e) The Selling Stockholder has not taken and will not take,
directly or indirectly, any action which is designed to or which has
constituted or which might reasonably be expected to cause or result in the
stabilization or manipulation of the price of any security of the Company
to facilitate the sale or resale of the shares of the Stock.
(f) The information specifically relating to the Selling
Stockholder contained in the Prospectus does 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 in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading.
(g) All authorizations, approvals and consents necessary for the
execution and delivery by such Selling Stockholder of this Agreement, the
U.S. Underwriting Agreement, the Power of Attorney and Custody Agreement
and the sale and delivery of the Stock to be sold by it hereunder and under
the U.S. Underwriting Agreement (other than such authorizations, approvals
or consents as may be necessary under state or foreign securities laws)
have been obtained and are in full force and effect.
(h) This Agreement, the U.S. Underwriting Agreement and the
Power of Attorney and Custody Agreement have been duly executed and
delivered by such Selling Stockholder.
3. Purchase of the Stock by the International Managers. On the
basis of the representations and warranties contained in, and subject to the
terms and conditions of, this Agreement, each Selling Stockholder agrees to sell
the number of shares of the Firm Stock set forth opposite its name on Schedule 2
hereto, severally and not jointly, to the several International Managers and
each of the International Managers, severally and not jointly, agrees to
purchase the number of shares of the Firm Stock set opposite that International
Manager's name in Schedule 1 hereto. Each
<PAGE>
11
International Manager shall be obligated to purchase from each Selling
Stockholder that number of shares of the Firm Stock which represents the same
proportion of the number of shares of the Firm Stock to be sold by each Selling
Stockholder as the number of shares of the Firm Stock set forth opposite the
name of such International Manager in Schedule 1 represents of the total number
of shares of the Firm Stock to be purchased by all of the International Managers
pursuant to this Agreement. The respective purchase obligations of the
International Managers with respect to the Firm Stock shall be rounded among the
International Managers to avoid fractional shares, as the Lead Managers may
determine.
In addition, the Settlement Trust grants to the International Managers
an option to purchase up to the number of shares of Option Stock set forth
opposite its name on Schedule 2 hereto, severally and not jointly. Such option
is granted for the purpose of covering over-allotments in the sale of Firm Stock
and is exercisable as provided in Section 5 hereof. Shares of Option Stock
shall be purchased severally for the account of the International Managers in
proportion to the number of shares of Firm Stock set opposite the name of such
International Managers in Schedule 1 hereto. The respective purchase
obligations of each International Manager with respect to the Option Stock shall
be adjusted by the Lead Managers so that no Lead Manager shall be obligated to
purchase Option Stock other than in 100 share amounts.
The price of both the Firm Stock and the Option Stock shall be
$_________ per share.
The Selling Stockholders shall not be obligated to deliver any of the
Stock to be delivered on any Delivery Date (as hereinafter defined), as the
case may be, except upon payment for all the Stock to be purchased on such
Delivery Date as provided herein and in the U.S. Underwriting Agreement.
4. OFFERING OF STOCK BY THE INTERNATIONAL MANAGERS. Upon
authorization by the Lead Managers of the release of the Firm Stock, the several
International Managers propose to offer the Firm Stock for sale upon the terms
and conditions set forth in the Prospectus.
5. DELIVERY OF AND PAYMENT FOR THE STOCK. Delivery of and payment
for the Firm Stock shall be made at the office of Paul, Weiss, Rifkind,
Wharton & Garrison, 1285 Avenue of the Americas, New York, NY 10019, at
10:00 A.M., New York City time, on the fourth full business day following the
date of this Agreement or at such other date or place as shall be determined by
agreement between the Lead Managers and the Selling Stockholders. This date and
time are sometimes referred to as the "First Delivery Date." On the First
Delivery Date, the Selling Stockholders shall deliver or cause to be delivered
certificates representing the Firm Stock to the Lead Managers for the account of
each International Manager against payment to or upon the order of each Selling
Stockholder of the purchase price by wire transfer in immediately available
funds. Time shall be of the essence, and delivery at the time and place
specified pursuant to this Agreement is a further condition of the obligation of
each
<PAGE>
12
Lead Manager hereunder. Upon delivery, the Firm Stock shall be registered in
such names and in such denominations as the Lead Managers shall request in
writing not less than two full business days prior to the First Delivery Date.
For the purpose of expediting the checking and packaging of the certificates for
the Firm Stock, the Selling Stockholders shall make the certificates
representing the Firm Stock available for inspection by the Lead Managers in
New York, New York, not later than 2:00 P.M., New York City time, on the
business day prior to the First Delivery Date.
The option granted in Section 3 will expire 30 days after the date of
this Agreement and may be exercised in whole or in part from time to time prior
to such expiration by written notice being given to the Company and each Selling
Stockholder by the Lead Managers. Such notice shall set forth the aggregate
number of shares of Option Stock as to which the option is being exercised, the
names in which the shares of Option Stock are to be registered, the
denominations in which the shares of Option Stock are to be sold and the date
and time, as determined by the Lead Managers, when the shares of Option Stock
are to be delivered; PROVIDED, HOWEVER, that this date and time shall not be
earlier than the First Delivery Date nor earlier than the second business day
after the date on which the option shall have been exercised nor later than the
fifth business day after the date on which the option shall have been exercised.
The date and time the shares of Option Stock are delivered are sometimes
referred to as a "Second Delivery Date" and the First Delivery Date and any
Second Delivery Date are sometimes each referred to as a "Delivery Date."
Delivery of and payment for the Option Stock shall be made at the
place specified in the first sentence of the first paragraph of this Section 5
(or at such other place as shall be determined by agreement between the Lead
Managers, the Company and the Selling Stockholders) at 10:00 A.M., New York City
time, on such Second Delivery Date. On such Second Delivery Date, each Selling
Stockholder shall deliver or cause to be delivered the certificates representing
the Option Stock to the Lead Managers for the account of each International
Manager against payment to or upon the order of each Selling Stockholder of the
purchase price by wire transfer in immediately available funds. Time shall be
of the essence, and delivery at the time and place specified pursuant to this
Agreement is a further condition of the obligation of each Lead Manager
hereunder. Upon delivery, the Option Stock shall be registered in such names
and in such denominations as the Lead Managers shall request in the aforesaid
written notice. For the purpose of expediting the checking and packaging of the
certificates for the Option Stock, the Selling Stockholders shall make the
certificates representing the Option Stock available for inspection by the Lead
Managers in New York, New York, not later than 2:00 P.M., New York City time, on
the business day prior to such Second Delivery Date.
<PAGE>
13
6. FURTHER AGREEMENTS OF THE COMPANY. The Company agrees:
(a) To comply with the requirements of Rules 424(b) and 430A
under the Securities Act; to make no further amendment or any supplement to
the Registration Statement or to the Prospectus prior to the last Delivery
Date in violation of Section 6(e) hereof; to advise the Lead Managers,
promptly after it receives notice thereof, of the time when any amendment
to the Registration Statement has been filed or becomes effective or any
supplement to the Prospectus or any amended Prospectus has been filed and
to furnish the Lead Managers with copies thereof; to file timely all
reports and any definitive proxy or information statements required to be
filed by the Company with the Commission pursuant to Section 13(a), 13(c),
14 or 15(d) of the Exchange Act subsequent to the date of the Prospectus
and for so long as the delivery of a prospectus is required in connection
with the offering or sale of the Stock; to advise the Lead Managers,
promptly after it receives notice thereof, of the issuance by the
Commission of any stop order or of any order preventing or suspending the
use of any Preliminary Prospectus or the Prospectus, of the suspension of
the qualification of the Stock for offering or sale in any jurisdiction, of
the initiation or threatening of any proceeding for any such purpose, or of
any request by the Commission for the amending or supplementing of the
Registration Statement or the Prospectus or for additional information;
and, in the event of the issuance of any stop order or of any order
preventing or suspending the use of any Preliminary Prospectus or the
Prospectus or suspending any such qualification, to use promptly its
reasonable best efforts to obtain its withdrawal.
(b) To furnish promptly to each of the Lead Managers and to
counsel for the International Managers a signed copy of the Registration
Statement as originally filed with the Commission, and each amendment
thereto filed with the Commission, including all consents and exhibits
filed therewith.
(c) To deliver promptly to the Lead Managers and to the Selling
Stockholders such number of the following documents as the Lead Managers or
the Selling Stockholders shall reasonably request: (1) conformed copies of
the Registration Statement as originally filed with the Commission and each
amendment thereto (in each case excluding exhibits other than this
Agreement), (2) each Preliminary Prospectus, the Prospectus and any amended
or supplemented Prospectus and (3) any document incorporated by reference
in the Prospectus (excluding exhibits thereto); and, if the delivery of a
prospectus is required at any time after the Effective Time in connection
with the offering or sale of the Stock or any other securities relating
thereto and if at such time any events shall have occurred as a result of
which the Prospectus as then amended or supplemented would include an
untrue statement of a material fact or omit to state any material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made when such Prospectus is delivered,
not misleading, or, if for any other reason it shall be
<PAGE>
14
necessary to amend or supplement the Prospectus or to file under the
Exchange Act any document incorporated by reference in the Prospectus in
order to comply with the Securities Act or the Exchange Act, to notify the
Lead Managers and, upon their request, to file such document and to prepare
and furnish without charge to each International Manager and to any dealer
in securities as many copies as the Lead Managers may from time to time
reasonably request of an amended or supplemented Prospectus which will
correct such statement or omission or effect such compliance.
(d) To file as promptly as practicable with the Commission any
amendment to the Registration Statement or the Prospectus or any supplement
to the Prospectus that is required by the Securities Act or requested by
the Commission.
(e) Prior to filing with the Commission any amendment to the
Registration Statement or supplement to the Prospectus, any document
incorporated by reference in the Prospectus or any Prospectus pursuant to
Rule 424 of the Rules and Regulations, to furnish a copy thereof to the
Lead Managers and counsel for the International Managers and not to file
any such document to which the Lead Managers shall reasonably object after
having been given reasonable notice of the proposed filing thereof.
(f) As soon as practicable after the Effective Date (it being
understood that the Company shall have until at least 410 days after the
end of the Company's current fiscal quarter), to make generally available
to the Company's security holders and to deliver to the Lead Managers an
earnings statement of the Company and its subsidiaries (which need not be
audited) complying with Section 11(a) of the Securities Act and the Rules
and Regulations (including, at the option of the Company, Rule 158).
(g) From time to time to take such action as the Lead Managers
may reasonably request to qualify the Stock for offering and sale under the
securities laws of such jurisdictions as the Lead Managers may reasonably
request and to comply with such laws so as to permit the continuance of
sales and dealings therein in such jurisdictions for as long as may be
necessary to complete the distribution of the Stock; provided that in
connection therewith the Company shall not be required to qualify as a
foreign corporation or to file a general consent to service of process in
any jurisdiction.
(h) For a period of 120 days from the date on which Post-
Effective Amendment No. 8 to the Registration Statement is filed, not to,
directly or indirectly, (1) offer for sale, sell, pledge (other than pledges in
existence on the date thereof) or otherwise dispose of (or enter into any
transaction or device which is designed to, or could be expected to, result in
the disposition by any person at any time in the future of) any shares of Common
Stock or securities convertible into or exchangeable for Common Stock (other
<PAGE>
15
than the Stock and shares issued pursuant to employee benefit plans,
qualified stock option plans or other employee compensation plans existing
on the date hereof or pursuant to currently outstanding options, warrants
or rights), or sell or grant options, rights or warrants with respect to
any shares of Common Stock or securities convertible into or exchangeable
for Common Stock (other than the grant of options pursuant to option plans
existing on the date hereof), or (2) enter into any swap or other
derivatives transaction that transfers to another, in whole or in part, any
of the economic benefits or risks of ownership of such shares of Common
Stock, whether any such transaction described in clause (1) or (2) above is
to be settled by delivery of Common Stock or other securities, in cash or
otherwise, in each case without the prior written consent of Lehman
Brothers Inc. and Donaldson, Lufkin & Jenrette Securities Corporation
("DLJ") (which consent shall not be unreasonably withheld); and to use its
reasonable efforts to cause each executive officer and director of the
Company and the persons listed on Schedule 3 hereto to furnish to the Lead
Managers, prior to the First Delivery Date, a letter or letters, in form
and substance reasonably satisfactory to counsel for the International
Managers, pursuant to which each such person shall agree not to, directly
or indirectly, (1) offer for sale, sell, pledge (other than pledges in
existence on the date hereof) or otherwise dispose of (or enter into any
transaction or device which is designed to, or could be expected to, result
in the disposition by any person at any time in the future of) any shares
of Common Stock or securities convertible into or exchangeable for Common
Stock or (2) enter into any swap or other derivatives transaction that
transfers to another, in whole or in part, any of the economic benefits or
risks of ownership of such shares of Common Stock, whether any such
transaction described in clause (1) or (2) above is to be settled by
delivery of Common Stock or other securities, in cash or otherwise, in each
case for a period of 120 days from the date on which Post-Effective
Amendment No. 8 to the Registration Statement is filed, without the prior
written consent of Lehman Brothers Inc. and DLJ (which consent shall not be
unreasonably withheld), except in each case for transfers or pledges to or
transactions with affiliates, heirs, executors and legal representatives of
such persons.
(i) To take such steps as shall be necessary to ensure that
neither the Company nor any subsidiary shall become an "investment company"
within the meaning of such term under the United States Investment Company
Act of 1940 and the rules and regulations of the Commission thereunder.
7. FURTHER AGREEMENT OF THE SELLING STOCKHOLDERS. Each of the
Selling Stockholders agrees:
(a) to deliver to the Lead Managers prior to the First Delivery
Date a properly completed and executed United States Treasury Department
Form W-9.
<PAGE>
16
(b) For a period of 120 days from the date the Registration
Statement is declared effective, not to, directly or indirectly, (1) offer
for sale, sell, pledge (other than pledges in existence on the date
thereof) or otherwise dispose of (or enter into any transaction or device
which is designed to, or could be expected to, result in the disposition by
any person at any time in the future of) any shares of Common Stock or
securities convertible into or exchangeable for Common Stock or (2) enter
into any swap or other derivatives transaction that transfers to another,
in whole or in part, any of the economic benefits or risks of ownership of
such shares of Common Stock, whether any such transaction described in
clause (1) or (2) above is to be settled by delivery of Common Stock or
other securities, in cash or otherwise, in each case without the prior
written consent of Lehman Brothers Inc. and DLJ in the case of the
Settlement Trust or without the consent of Lehman Brothers Inc. in the case
of Lehman Brothers Holdings Inc., which consents shall not be unreasonably
withheld.
(c) That the Stock to be sold by the Selling Stockholder
hereunder which is represented by the certificates held in custody for the
Selling Stockholder is subject to the interest of the International
Managers and the other Selling Stockholder thereunder that the arrangements
made by the Selling Stockholder for such custody are to that extent
irrevocable, and that the obligations of the Selling Stockholder hereunder
shall not be terminated by any act of the Selling Stockholder, by operation
of law or by the death or incapacity of any executor or trustee or the
termination of the Settlement Trust, or the occurrence of any other event.
8. EXPENSES. Subject to Section 13 hereof, the Company agrees to
pay (a) the costs incident to the authorization, sale and delivery of the Stock
and any taxes payable in that connection; (b) the costs incident to the
preparation, printing and filing under the Securities Act of the Registration
Statement and any amendments and exhibits thereto; (c) the costs of distributing
the Registration Statement as originally filed and each amendment thereto and
any post-effective amendments thereof (including, in each case, exhibits), any
Preliminary Prospectus, the Prospectus and any amendment or supplement to the
Prospectus or any document incorporated by reference therein, all as provided in
this Agreement; (d) the costs of producing and distributing this Agreement and
the Agreement Between U.S. Underwriters and International Managers and any other
related documents in connection with the offering, purchase, sale and delivery
of the Stock; (e) the filing fees incident to securing any required review by
the National Association of Securities Dealers, Inc. of the terms of sale of the
Stock; (f) any applicable listing or other fees; (g) the fees and expenses of
qualifying the Stock under the securities laws of the several jurisdictions as
provided in Section 6(g) and of preparing, printing and distributing a Blue Sky
Memorandum (including related fees and expenses of counsel to the International
Managers); (h) all other costs and expenses incident to the performance of the
obligations of the Company and the Selling Stockholders under this Agreement and
(i) all Expenses (as defined in the Registration Rights Agreement); PROVIDED
that, except as expressly provided otherwise in this
<PAGE>
17
Section 8 the International Managers shall pay their own costs and expenses,
including the costs and expenses of their counsel, any transfer taxes on the
Stock which they may sell and the expenses of advertising any offering of the
Stock made by the Lead Managers and any transfer taxes payable in connection
with its respective sales of Stock to the International Managers and reimburse
the Company for its pro rata share of the fees and expenses paid by the Company
in connection with the offering of the Stock; and PROVIDED FURTHER that
notwithstanding anything to the contrary in the foregoing, the Selling
Stockholders shall pay all underwriting discounts and commissions and all other
costs and expenses incident to the transactions contemplated hereby which are
not Expenses (as defined in the Registration Rights Agreement) payable by the
Company pursuant to the Registration Rights Agreement.
9. CONDITIONS OF INTERNATIONAL MANAGERS' OBLIGATIONS. The
respective obligations of the International Managers hereunder are subject to
the accuracy, when made and on each Delivery Date, of the representations and
warranties of the Company and each of the Selling Stockholders contained herein,
to the performance by the Company and each of the Selling Stockholders of its
respective obligations hereunder, and to each of the following additional terms
and conditions:
(a) The Prospectus shall have been timely filed with the
Commission in accordance with Section 6(a); no stop order suspending the
effectiveness of the Registration Statement or any part thereof shall have
been issued and no proceeding for that purpose shall have been initiated or
threatened by the Commission; and any request of the Commission for
inclusion of additional information in the Registration Statement or the
Prospectus or otherwise shall have been complied with.
(b) No U.S. Underwriter or International Manager shall have
discovered and disclosed to the Company on or prior to such Delivery Date
that the Registration Statement or the Prospectus or any amendment or
supplement thereto contains an untrue statement of a fact which, in the
opinion of counsel for the International Managers, is material or omits to
state a fact which, in the opinion of such counsel, is material and is
required to be stated therein or is necessary to make the statements
therein not misleading.
(c) All corporate proceedings and other legal matters incident
to the authorization, form and validity of this Agreement, the U.S.
Underwriting Agreement, the Stock, the Registration Statement and the
Prospectus, and all other legal matters relating to this Agreement and the
transactions contemplated hereby shall be reasonably satisfactory in all
material respects to counsel for the International Managers, and the
Company and each of the Selling Stockholders shall have furnished to such
counsel all documents and information that they may reasonably request to
enable them to pass upon such matters.
(d) Edward A. Porter, Vice President, General Counsel and
Secretary of the Company, shall have furnished to the Lead Managers his
written
<PAGE>
18
opinion, as counsel to the Company, addressed to the International Managers
and dated such Delivery Date, in form and substance reasonably satisfactory
to the Lead Managers, to the effect that:
1. Each of the Company's Significant Subsidiaries has been duly
incorporated and is validly existing as a corporation in good standing
under the laws of its respective jurisdiction of incorporation; and
the Company and each of its Significant Subsidiaries are duly
qualified to do business and are in good standing as foreign
corporations in each jurisdiction in which their respective ownership
or lease of property or the conduct of their respective businesses
requires such qualification and have all corporate power and authority
necessary to own or hold their respective properties and conduct the
businesses in which they are engaged;
2. The Company has an authorized capitalization as set forth in
the Prospectus, and all of the issued shares of capital stock of the
Company (including the shares of Stock being delivered on such
Delivery Date) have been duly and validly authorized and issued, are
fully paid and non-assessable and conform to the description thereof
contained in the Prospectus; and all of the issued shares of capital
stock of each Significant Subsidiary of the Company have been duly and
validly authorized and issued and are fully paid, non-assessable and
(except for directors' qualifying shares and except as disclosed in
the Prospectus) are owned directly or indirectly by the Company, free
and clear of all liens, encumbrances, equities or claims;
3. Except as disclosed in the Prospectus, there are no
preemptive or other rights to subscribe for or to purchase, nor any
restriction upon the voting or transfer of, any shares of the Stock
pursuant to the Company's charter or by-laws or any agreement or other
instrument known to such counsel;
4. To the best of such counsel's knowledge and except as
disclosed in the Prospectus, there are no legal or governmental
proceedings pending to which the Company or any of its subsidiaries is
a party or of which any property or assets of the Company or any of
its subsidiaries is the subject which could reasonably be expected to
be determined so as to have a Material Adverse Effect; and, to the
best of such counsel's knowledge, no such proceedings are threatened
by governmental authorities or threatened by others;
5. To the best of such counsel's knowledge, there are no
contracts or other documents which are required to be described in the
Prospectus or filed as exhibits to the Registration Statement by the
Securities Act or by the Rules and Regulations which have not been
<PAGE>
19
described or filed as exhibits to the Registration Statement or
incorporated therein by reference as permitted by the Rules and
Regulations;
6. This Agreement and the U.S. Underwriting Agreement has each
been duly authorized, executed and delivered by the Company;
7. The compliance by the Company with all of the provisions of
this Agreement and the U.S. Underwriting Agreement and the
consummation of the transactions contemplated hereby and thereby will
not conflict with or result in a breach or violation of any of the
terms or provisions of, or constitute a default under, any indenture,
mortgage, deed of trust, loan agreement or other agreement or
instrument known to such counsel to which the Company or any of its
subsidiaries is a party or by which the Company or any of its
subsidiaries is bound or to which any of the property or assets of the
Company or any of its subsidiaries is subject, except for such
conflicts, breaches, violations or defaults which would not result in
a Material Adverse Effect or materially impair the ability of the
Company to consummate the transactions contemplated hereby; nor will
such actions result in any violation of the provisions of the charter
or by-laws of the Company or any of its subsidiaries or any statute or
any order, rule or regulation known to such counsel of any court or
governmental agency or body having jurisdiction over the Company or
any of its subsidiaries or any of their properties or assets, except
for such violations of statutes, orders, rules or regulations which
would not result in a Material Adverse Effect or materially impair the
ability of the Company to consummate the transactions contemplated
hereby; and, except for the registration of the Stock under the
Securities Act and such consents, approvals, authorizations,
registrations or qualifications as may be required under the Exchange
Act and applicable state or foreign securities laws in connection with
the purchase and distribution of the Stock by the U.S. Underwriters
and the International Managers, no consent, approval, authorization or
order of, or filing or registration with, any such court or
governmental agency or body is required for the execution, delivery
and performance of this Agreement or the U.S. Underwriting Agreement
by the Company and the consummation of the transactions contemplated
hereby and thereby; and
8. To the best of such counsel's knowledge, other than as
disclosed in the Prospectus, there are no contracts, agreements or
understandings between the Company and any person granting such person
the right (other than rights which have been waived or satisfied) to
require the Company to file a registration statement under the
Securities Act with respect to any securities of the Company owned or
to be owned by such person or to require the Company to include such
securities in the securities registered pursuant to the Registration
<PAGE>
20
Statement or in any securities being registered pursuant to any other
registration statement filed by the Company under the Securities Act.
In rendering such opinion, such counsel may state that he does
not express any opinion concerning any law other than the laws of the
States of Wisconsin and Texas and the Delaware General Corporation Law
and such counsel may rely (to the extent such counsel deems proper and
specifies in its opinion) as to matters involving the application of
the laws of the States of Alabama and Florida, respectively, upon the
opinion of Bradley, Arant, Rose & White and Carlton, Fields, Ward,
Emmanuel, Smith & Cutler or other counsel reasonably satisfactory
to counsel to the International Managers, provided that each such
Alabama and Florida counsel furnishes a copy of its opinion to the
Lead Managers. Such counsel shall also have furnished to the Lead
Managers a written statement, addressed to the International Managers
and dated such Delivery Date, in form and substance reasonably
satisfactory to the Lead Managers, to the effect that (i) such
counsel has not independently verified the accuracy, completeness or
fairness of the statements made or included in the Registration
Statement, the Prospectus or the documents incorporated by reference
in the Prospectus (the "Exchange Act Documents") and takes no
responsibility therefor, (ii) such counsel has acted as General
Counsel to the Company and has participated in the preparation of the
Registration Statement, and (iii) based upon such counsel's
examination of the Registration Statement, the Prospectus and the
Exchange Act Documents and his investigations made in connection with
the preparation of the Registration Statement, the Prospectus and the
Exchange Act Documents, such counsel has no reason to believe that
the Registration Statement as of its effective date contained any
untrue statement of a material fact or omitted to state any material
fact required to be stated therein or necessary in order to make the
statements therein not misleading or that the Prospectus contains any
untrue statement of a material fact or omits to state any material
fact necessary in order to make the statements therein, in the light
of the circumstances under which they were made, not misleading,
except that in each case such counsel may express no belief with
respect to the financial statements or other financial or statistical
data contained or incorporated by reference in the Registration
Statement or the Prospectus.
(e) Simpson Thacher & Bartlett shall have furnished to the Lead
Managers its written opinion, as counsel to the Company, addressed to the
International Managers and dated such Delivery Date, in form and substance
reasonably satisfactory to the Lead Managers, to the effect that;
1. The Company has been duly incorporated and is validly
existing and in good standing as a corporation under the laws of the
State of Delaware;
2. The Registration Statement has become effective under the
Securities Act and the Prospectus was filed on the date specified in
such
<PAGE>
21
opinion pursuant to Rule 424(b) of the Rules and Registrations and, to
such counsel's knowledge, no stop order suspending the effectiveness
of the Registration Statement has been issued or proceeding for that
purpose has been instituted or threatened by the Commission;
3. The statements made in the Prospectus under the caption
"CERTAIN FEDERAL INCOME TAX CONSEQUENCES," insofar as they purport to
constitute summaries of matters under United States federal tax law
and regulations or legal conclusions with respect thereto, and the
statements made in the Prospectus under the caption "DESCRIPTION OF
CAPITAL STOCK," insofar as they purport to constitute summaries of the
Stock and of legal matters, constitute accurate summaries of the
matters described therein in all material respects;
In rendering such opinion, such counsel may state that (i) such
counsel has acted as counsel to the Company in connection with the
Offering and (ii) it does not express any opinion concerning any law
other than the law of the State of New York, the federal law of the
United States and the Delaware General Corporation Law. Such counsel
shall also have furnished to the Lead Managers a written statement,
addressed to the International Managers and dated such Delivery Date,
in form and substance reasonably satisfactory to the Lead Managers, to
the effect that (i) such counsel has not independently verified the
accuracy, completeness or fairness of the statements made or included
in the Registration Statement, the Prospectus or the Exchange Act
Documents and takes no responsibility therefor, except as and to the
extent set forth in paragraph 3 above, (ii) in the course of the
preparation by the Company of the Registration Statement and the
Prospectus (excluding the Exchange Act Documents) such counsel
participated in conferences with certain officers and employees of the
Company, and (iii) based upon such counsel's examination of the
Registration Statement, the Prospectus and the Exchange Act
Documents, its investigations made in connection with the preparation
of the Registration Statement and the Prospectus and its participation
in the conferences referred to above, (A) such counsel is of the
opinion that the Registration Statement, as of its effective date,
the Prospectus, as of its date, and the Exchange Act Documents, as of
their respective dates of filing, complied as to form in all material
respects with the requirements of the Act and the applicable rules and
regulations of the Commission thereunder, except that in each case
such counsel expresses no opinion with respect to the financial
statements or other financial or statistical data contained or
incorporated by reference in the Registration Statement, the
Prospectus or the Exchange Act Documents, and (B) such counsel has no
reason to believe that the Registration Statement, as of the
Effective Date, including the Exchange Act Documents on file with the
Commission on such Effective Date, contained any untrue statement of
a material fact or omitted to state a material fact required to be
stated therein or necessary in order to make the statements therein
not misleading, or that the Prospectus (including the Exchange Act
Documents) contains any untrue statement of a material fact or omits
to state any material fact
<PAGE>
22
required to be stated therein or necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading, except that in each case such counsel may
express no belief with respect to the financial statements or other
financial or statistical data contained or incorporated by reference
in the Registration Statement, the Prospectus or the Exchange Act
Documents.
(f) The Lead Managers shall have received from each of Kevin R.
Genirs, counsel for Lehman, and Keating, Muething & Klekamp P.L.L., counsel
for the Settlement Trust, a written opinion, addressed to the International
Managers and dated such Delivery Date, in form and substance reasonably
satisfactory to the Lead Managers, to the effect that:
1. Such Selling Stockholder has full right, power and authority
to enter into this Agreement, the U.S. Underwriting Agreement, the
Power of Attorney and the Custody Agreement and to perform its
obligations hereunder and thereunder;
2. This Agreement and the U.S. Underwriting Agreement have been
duly authorized, executed and delivered by or on behalf of such
Selling Stockholder;
3. A Power-of-Attorney and a Custody Agreement have been duly
authorized, executed and delivered by the such Selling Stockholder and
constitute valid and binding agreements of such Selling Stockholder,
enforceable in accordance with their respective terms; and
4. The execution, delivery and performance of this Agreement,
the U.S. Underwriting Agreement, the Power of Attorney and the Custody
Agreement by such Selling Stockholder and the consummation by such
Selling Stockholder of the transactions contemplated hereby and
thereby will not conflict with or result in a breach or violation in
any material respect of any of the terms or provisions of, or
constitute a default under, any material indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument known to such
counsel to which such Selling Stockholder is a party or by which such
Selling Stockholder is bound or to which any of the property or assets
of such Selling Stockholder is subject, nor will such actions result
in any violation in any material respect of the provisions of the
charter, by-laws, trust instrument or other organizing instrument (as
applicable) of such Selling Stockholder or any statute or any order,
rule or regulation known to such counsel of any court or governmental
agency having jurisdiction over such Selling Stockholder or the
property or assets of such Selling Stockholder; and no consent,
approval, authorization or order of, or filing or registration with,
any such court or governmental agency is required for the execution,
delivery and performance of this
<PAGE>
23
Agreement, the U.S. Underwriting Agreement, the Power of Attorney and
the Custody Agreement by such Selling Stockholder and the consummation
by such Selling Stockholder of the transactions contemplated hereby
and thereby, except the registration under the Securities Act of the
Stock, such consents, approvals, authorizations, registrations,
filings or qualifications as may be required under state securities or
Blue Sky laws in connection with the purchase and distribution of the
shares by the International Managers or as may be required by the laws
of any country other than the United States, and amendments to filings
made under the Exchange Act.
(g) The Lead Managers shall have received from Paul, Weiss,
Rifkind, Wharton & Garrison, counsel for the International Managers, such
opinion or opinions, dated such Delivery Date, with respect to the sale of
the Stock, the Registration Statement, the Prospectus and other related
matters as the Lead Managers may reasonably require, and the Company shall
have furnished to such counsel such documents as they reasonably request
for the purpose of enabling them to pass upon such matters.
(h) At the time of execution of this Agreement, the Lead
Managers shall have received a letter from each of Price Waterhouse LLP and
Arthur Andersen LLP, in form and substance reasonably satisfactory to the
Lead Managers, addressed to the International Managers and dated the date
hereof (1) confirming that they are independent public accountants within
the meaning of the Securities Act and are in compliance with the applicable
requirements relating to the qualification of accountants under Rule 2-01
of Regulation S-X of the Commission and (2) stating, as of the date hereof
(or, with respect to matters involving changes or developments since the
respective dates as of which specified financial information is given in
the Prospectus, as of a date not more than five days prior to the date
hereof), the conclusions and findings of such firm with respect to the
financial information and other matters ordinarily covered by accountants'
"comfort letters" to underwriters in connection with registered public
offerings.
(i) With respect to each of the letters of Price Waterhouse LLP
and Arthur Andersen LLP referred to in the preceding paragraph and
delivered to the Lead Managers concurrently with the execution of this
Agreement (each, an "initial letter"), the Company shall have furnished to
the Lead Managers a letter (the "bring-down letter") of each of such firm
of accountants, addressed to the International Managers and dated such
Delivery Date (1) confirming that they are independent public accountants
within the meaning of the Securities Act and are in compliance with the
applicable requirements relating to the qualification of accountants under
Rule 2-01 of Regulation S-X of the Commission and (2) stating, as of the
date of the bring-down letter (or, with respect to matters involving
changes or developments since the respective dates as of which specified
financial information is given in the
<PAGE>
24
Prospectus, as of a date not more than three days prior to the date of the
bring-down letter), the conclusions and findings of such firm with respect
to the financial information and other matters covered by the respective
initial letter.
(j) The Company shall have furnished to the Lead Managers a
certificate, dated such Delivery Date, of (1) its Chairman of the Board,
its President or a Vice President and (2) its chief financial officer
stating that:
1. The representations and warranties of the Company in
Section 1 are true and correct in all material respects as of such Delivery
Date with the same force and effect as though expressly made as of such
Delivery Date; the Company has complied with all its agreements contained
herein to be compiled with by the Company at or prior to such Delivery
Date; and the conditions set forth in Sections 9(a) and 9(l) have been
fulfilled; and
2. They have carefully examined the Registration Statement and
the Prospectus and, to the best of their knowledge, (A) as of the Effective
Date, the Registration Statement and the Prospectus did not include any
untrue statement of a material fact and did not omit to state a material
fact required to be stated therein or necessary to make the statements
therein not misleading, and (B) since the Effective Date no event has
occurred which should have been set forth but has not been so set forth in
a supplement or amendment to the Registration Statement or the Prospectus.
(k) Each Selling Stockholder shall have furnished to the Lead
Managers a certificate, dated such Delivery Date, signed by, or on behalf
of, such Selling Stockholder stating that the representations and
warranties of such Selling Stockholder contained herein are true and
correct in all material respects as of such Delivery Date with the same
force and effect as though expressly made as of such Delivery Date and that
such Selling Stockholder has complied with all agreements contained herein
to be complied with by such Selling Stockholder at or prior to such
Delivery Date.
(l) (1) Neither the Company nor any of its subsidiaries shall
have sustained since the date of the latest audited financial statements
included or incorporated by reference in the Prospectus any loss or
interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor dispute or
court or governmental action, order or decree, otherwise than as set forth
or contemplated in the Prospectus, or (2) since such date there shall not
have been any change in the capital stock or long-term debt or a decrease
in the net current assets or net assets of the Company or any of its
subsidiaries or any change, or any development involving a prospective
change, in or affecting the general affairs, management, financial
position, stockholders' equity or results of operations of the Company and
its subsidiaries, otherwise than as set forth or contemplated in the
Prospectus, the effect of which, in any such case described in clause
(1) or (2), is, in the
<PAGE>
25
judgment of the Lead Managers, so material and adverse as to make it
impracticable or inadvisable to proceed with the public offering or the
delivery of the Stock being delivered on such Delivery Date on the terms
and in the manner contemplated in the Prospectus.
(m) Subsequent to the execution and delivery of this Agreement
there shall not have occurred any of the following: (1) trading in
securities generally on the New York Stock Exchange or the American Stock
Exchange or in the over-the-counter market, or trading in any securities of
the Company on any exchange or in the over-the-counter market, shall have
been suspended or minimum prices shall have been established on any such
exchange or such market by the Commission, by such exchange or by any other
regulatory body or governmental authority having jurisdiction, (2) a
banking moratorium shall have been declared by Federal or state
authorities, (3) the United States shall have become engaged in
hostilities, there shall have been an escalation in hostilities involving
the United States or there shall have been a declaration of a national
emergency or war by the United States or (4) there shall have occurred such
a material adverse change in general economic, political or financial
conditions (or the effect of international conditions on the financial
markets in the United States shall be such) as to make it, in the judgment
of a majority in interest of the several International Managers,
impracticable or inadvisable to proceed with the public offering or
delivery of the Stock being delivered on such Delivery Date on the terms
and in the manner contemplated in the Prospectus.
(n) The closing under the U.S. Underwriting Agreement shall have
occurred concurrently with the closing hereunder on the First Delivery
Date.
All opinions, letters, evidence and certificates mentioned above or
elsewhere in this Agreement shall be deemed to be in compliance with the
provisions hereof only if they are in form and substance reasonably
satisfactory to counsel for the International Managers.
10 INDEMNIFICATION AND CONTRIBUTION.
(a) The Company shall indemnify and hold harmless each Selling
Stockholder and each International Manager, their respective officers,
trustees and employees and each person, if any, who controls any Selling
Stockholder or International Manager within the meaning of the Securities
Act, from and against any loss, claim, damage or liability, joint or
several, or any action in respect thereof (including, but not limited to,
any loss, claim, damage, liability or action relating to purchases and
sales of Stock), to which that Selling Stockholder or International
Manager, officer, trustee, employee or controlling person may become
subject, under the Securities Act or otherwise, insofar as such loss,
claim, damage, liability or action arises out of, or is based upon, (i) any
untrue statement or alleged untrue statement of a material fact contained
<PAGE>
26
(A) in any Preliminary Prospectus, the Registration Statement or the
Prospectus or in any amendment or supplement thereto or (B) in any Blue Sky
Application, (ii) the omission or alleged omission to state in any
Preliminary Prospectus, the Registration Statement or the Prospectus, or in
any amendment or supplement thereto, or in any Blue Sky Application, any
material fact required to be stated therein or necessary to make the
statements therein not misleading or (iii) any act or failure to act or any
alleged act or failure to act by any Selling Stockholder or International
Manager in connection with, or relating in any manner to, the Stock or the
offering contemplated hereby, and which is included as part of or referred
to in any loss, claim, damage, liability or action arising out of or based
upon matters covered by clause (i) or (ii) above (PROVIDED that the Company
shall not be liable under this clause (iii) to the extent that it is
determined in a final judgment by a court of competent jurisdiction that
such loss, claim, damage, liability or action resulted directly from any
such acts or failures to act undertaken or omitted to be taken by such
Selling Stockholder or International Manager through its gross negligence
or willful misconduct), and shall reimburse each Selling Stockholder and
each International Manager and each such officer, trustee, employee or
controlling person promptly upon receipt of invoices from such Selling
Stockholder or International Managers for any legal or other expenses
reasonably incurred by that Selling Stockholder, International Manager,
officer, trustee, employee or controlling person in connection with
investigating or defending or preparing to defend against any such loss,
claim, damage, liability or action as such expenses are incurred; PROVIDED,
HOWEVER, that the Company shall not be liable in any such case to the
extent that any such loss, claim, damage, liability or action arises out
of, or is based upon, any untrue statement or alleged untrue statement or
omission or alleged omission made in any Preliminary Prospectus, the
Registration Statement or the Prospectus, or in any such amendment or
supplement or in any Blue Sky Applications, in reliance upon and in
conformity with written information concerning such Selling Stockholder or
International Manager furnished to the Company by such Selling Stockholder
or through the Lead Managers by or on behalf of any International Manager
specifically for inclusion therein which information consists solely of the
information specified in Sections 10(f) and 10(g); and PROVIDED FURTHER
that as to any Preliminary Prospectus this indemnity agreement shall not
inure to the benefit of any International Manager, its officers or
employees or any person controlling that International Manager on account
of any loss, claim, damage, liability or action arising from the sale of
Stock to any person by that International Manager if that International
Manager failed to send or give a copy of the Prospectus, as the same may be
amended or supplemented, to that person within the time required by the
Securities Act, and the untrue statement or alleged untrue statement of any
material fact or omission or alleged omission to state a material fact in
such Preliminary Prospectus was corrected in the Prospectus, unless such
failure resulted from non-compliance by the Company with Section 6(c). For
purposes of the last provision to the immediately preceding sentence, the
term "Prospectus" shall not be deemed to include the documents incorporated
therein by reference, and no International Manager shall
<PAGE>
27
be obligated to send or give any supplement or amendment to any document
incorporated by reference in any Preliminary Prospectus or the Prospectus
to any person other than a person to whom such International Manager had
delivered such incorporated document or documents in response to a written
request therefor. The foregoing indemnity agreement is in addition to any
liability which the Company may otherwise have to any International
Manager, any Selling Stockholder or to any officer, trustee, employee or
controlling person of that International Manager or Selling Stockholder.
(b) Each Selling Stockholder severally and not jointly shall
indemnify and hold harmless the Company and each International Manager from
and against any loss, claim, damage or liability, joint or several, or any
action in respect thereof, to which the Company or such International
Manager may become subject, under the Securities Act or otherwise, insofar
as such loss, claim, damage, liability or action arises out of, or is based
upon, (i) any untrue statement or alleged untrue statement of a material
fact contained (A) in any Preliminary Prospectus, the Registration
Statement or the Prospectus or in any amendment or supplement thereto or
(B) in any Blue Sky Application, or (ii) the omission or alleged omission
to state in any Preliminary Prospectus, the Registration Statement or the
Prospectus, or in any amendment or supplement thereto, or in any Blue Sky
Application, any material fact required to be stated therein or necessary
to make the statements therein, in the light of the circumstances under
which they were made, not misleading and shall reimburse the Company or
such Lead Manager promptly after receipt of invoices from the Company or
such Lead Manager for any legal or other expenses as reasonably incurred by
the Company or such Lead Manager in connection with investigating,
preparing to defend or defending against or appearing as a third-party
witness in connection with any such loss, claim, damage, liability or
action notwithstanding the possibility that payments for such expenses
might later be held to be improper, in which case such payments shall be
promptly refunded; PROVIDED, HOWEVER, that such indemnification or
reimbursement shall be available in each such case to the extent, but only
to the extent, that such untrue statement or alleged untrue statement or
omission or alleged omission was made in reliance upon and in conformity
with written information furnished to the Company or such International
Manager by or on behalf of and concerning the Selling Stockholder from whom
such indemnification is sought specifically for use in the preparation
thereof; PROVIDED, FURTHER, that no Selling Stockholder shall be liable
pursuant to this Section 10(b) with respect to any untrue statement or
alleged untrue statement or omission or alleged omission in any Preliminary
Prospectus which is corrected in a Prospectus if the person asserting such
loss, claim, damage or liability purchased Stock from an International
Manager but was not sent or given a copy of a Prospectus at or prior to the
written confirmation of the sale of such Stock to such person; and
PROVIDED, FURTHER, that the aggregate amount of all such indemnification or
reimbursement payable by any Selling Stockholder pursuant to this Agreement
and the U.S. Underwriting Agreement
<PAGE>
28
shall in no case exceed the net proceeds to such Selling Stockholder from
the sale of the Stock.
(c) Each International Manager, severally and not jointly, shall
indemnify and hold harmless the Company and each Selling Stockholder, their
officers and employees, each of their directors, trustees and each person,
if any, who controls the Company and each Selling Stockholder within the
meaning of the Securities Act, from and against any loss, claim, damage or
liability, joint or several, or any action in respect thereof, to which the
Company or a Selling Stockholder or any such director, trustee, officer or
controlling person may become subject, under the Securities Act or
otherwise, insofar as such loss, claim, damage, liability or action arises
out of, or is based upon, (i) any untrue statement or alleged untrue
statement of a material fact contained (A) in any Preliminary Prospectus,
the Registration Statement or the Prospectus or in any amendment or
supplement thereto or (B) in any Blue Sky Application or (ii) the omission
or alleged omission to state in any Preliminary Prospectus, the
Registration Statement or the Prospectus, or in any amendment or supplement
thereto, or in any Blue Sky Application, any material fact required to be
stated therein or necessary to make the statements therein not misleading,
but in each case only to the extent that the untrue statement or alleged
untrue statement or omission or alleged omission was made in reliance upon
and in conformity with written information concerning such International
Manager furnished to the Company through the Lead Managers by or on behalf
of that International Manager specifically for inclusion therein, and shall
reimburse the Company, the Selling Stockholders and any such director,
trustee, officer or controlling person for any legal or other expenses
reasonably incurred by the Company, the Selling Stockholders or any such
director, trustee, officer or controlling person in connection with
investigating or defending or preparing to defend against any such loss,
claim, damage, liability or action as such expenses are incurred. The
foregoing indemnity agreement is in addition to any liability which any
International Manager may otherwise have to the Company, the Selling
Stockholders or any such director, trustee, officer, employee or
controlling person.
(d) Promptly after receipt by an indemnified party under this
Section 10 of notice of any claim or the commencement of any action, the
indemnified party shall, if a claim in respect thereof is to be made
against the indemnifying party under this Section 10, notify the
indemnifying party in writing of the claim or the commencement of that
action; PROVIDED, HOWEVER, that the failure to notify the indemnifying
party shall not relieve it from any liability which it may have under this
Section 10 except to the extent it has been actually prejudiced by such
failure and, PROVIDED FURTHER, that the failure to notify the indemnifying
party shall not relieve it from any liability which it may have to an
indemnified party otherwise than under this Section 10. If any such claim
or action shall be brought against an indemnified party, and it shall
notify the indemnifying party thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it wishes, jointly
with any other
<PAGE>
29
similarly notified indemnifying party, to assume the defense thereof with
counsel reasonably satisfactory to the indemnified party. After notice
from the indemnifying party to the indemnified party of its election to
assume the defense of such claim or action, the indemnifying party shall
not be liable to the indemnified party under this Section 10 for any legal
or other expenses subsequently incurred by the indemnified party in
connection with the defense thereof other than reasonable costs of
investigation; PROVIDED, HOWEVER, that the Lead Managers shall have the
right to employ counsel to represent jointly the Lead Managers and those
other International Managers and their respective officers, employees and
controlling persons who may be subject to liability arising out of any
claim in respect of which indemnity may be sought by the International
Managers against the Company or any Selling Stockholder under this
Section 10 if, in the reasonable judgment of the Lead Managers, a conflict
of interest between the Company or such Selling Stockholder, on the one
hand, and the International Managers, on the other hand, exists or there
may be one or more legal defenses available to the International Managers
that are different or additional to those available to the Company or the
Selling Stockholder, and in that event the fees and expenses of such
separate counsel shall be paid by the Company and such Selling Stockholder.
No indemnifying party shall (i) without the prior written consent of the
indemnified parties (which consent shall not be unreasonably withheld),
settle or compromise or consent to the entry of any judgment with respect
to any pending or threatened claim, action, suit or proceeding in respect
of which indemnification or contribution may be sought hereunder (whether
or not the indemnified parties are actual or potential parties to such
claim or action) unless such settlement, compromise or consent includes an
unconditional release of each indemnified party from all liability arising
out of such claim, action, suit or proceeding, or (ii) be liable for any
settlement of any such action effected without its written consent (which
consent shall not be unreasonably withheld), but if settled with the
consent of the indemnifying party or if there be a final judgment of the
plaintiff in any such action, the indemnifying party agrees to indemnify
and hold harmless any indemnified party from and against any loss or
liability by reason of such settlement or judgment.
(e) If the indemnification provided for in this Section 10 shall
for any reason be unavailable to or insufficient to hold harmless an
indemnified party under Section 10(a) or 10(b) or 10(c) in respect of any
loss, claim, damage or liability, or any action in respect thereof,
referred to therein, then each indemnifying party shall, in lieu of
indemnifying such indemnified party, contribute to the amount paid or
payable by such indemnified party as a result of such loss, claim, damage
or liability, or action in respect thereof, (i) in such proportion as shall
be appropriate to reflect the relative benefits received by the Company and
the Selling Stockholders on the one hand and the International Managers on
the other from the offering of the Stock or (ii) if the allocation provided
by clause (i) above is not permitted by applicable law, in such proportion
as shall be appropriate to reflect not only the relative benefits referred
to in clause (i) above but also the relative fault of the Company and the
Selling
<PAGE>
30
Stockholders on the one hand and the International Managers on the other
with respect to the statements or omissions which resulted in such loss,
claim, damage or liability, or action in respect thereof, as well as any
other relevant equitable considerations The relative benefits received by
the Company and the Selling Stockholders on the one hand and the
International Managers on the other with respect to such offering shall be
deemed to be in the same proportion as the total net proceeds from the
offering of the Stock purchased under this Agreement (before deducting
expenses) received by the Company and the Selling Stockholders, on the one
hand, and the total underwriting discounts and commissions received by the
International Managers with respect to the shares of the Stock purchased
under this Agreement, on the other hand, bear to the total gross proceeds
from the offering of the shares of the Stock under this Agreement, in each
case as set forth in the table on the cover page of the Prospectus. The
relative fault shall be determined by reference to whether the 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, a
Selling Stockholder or the International Managers, the intent of the
parties and their relative knowledge, access to information and opportunity
to correct or prevent such statement or omission. The Company, the Selling
Stockholders and the International Managers agree that it would not be just
and equitable if contributions pursuant to this Section 10(e) were to be
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 into account the equitable considerations
referred to herein. The amount paid or payable by an indemnified party as
a result of the loss, claim, damage or liability, or action in respect
thereof, referred to above in this Section 10 shall be deemed to include,
for purposes of this Section 10(e), any legal or other expenses reasonably
incurred by such indemnified party in connection with investigating or
defending any such action or claim. Notwithstanding the provisions of this
Section 10(e), no International Manager shall be required to contribute any
amount in excess of the amount by which the total price at which the Stock
underwritten by it and distributed to the public was offered to the public
exceeds the amount of any damages which such International Manager has
otherwise paid or become liable to pay by reason of any untrue or alleged
untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who was
not guilty of such fraudulent misrepresentation. The International
Managers' obligations to contribute as provided in this Section 10(e) are
several in proportion to their respective underwriting obligations and not
joint.
(f) Each of the Selling Stockholders severally confirm that the
statements with respect to the number of shares of Common Stock
beneficially owned by such Selling Stockholder prior to the public offering
of the Stock, the number of shares to be sold by such Selling Stockholder
in the public offering and the number of shares of Common Stock to be
beneficially owned by such
<PAGE>
31
Selling Stockholder appearing under the caption "Selling Stockholders" in
the Prospectus are correct and constitute the only information concerning
such Selling Stockholder furnished in writing to the Company by or on
behalf of such Selling Stockholder specifically for inclusion in the
Registration Statement and the Prospectus.
(g) The International Managers severally confirm that the
statements with respect to the public offering of the Stock by the
International Managers set forth on the cover page of, and the legend
concerning over-allotments on the inside front cover page of, the
Prospectus Supplement, the concession and reallowance figures appearing in
the sixth paragraph under the caption "Underwriting" and the seventh,
ninth, tenth, thirteenth, fourteenth, fifteenth, eighteenth, and twentieth
paragraphs appearing under the caption "Underwriting" in the Prospectus
are correct and constitute the only information concerning such
International Managers furnished in writing to the Company by or on behalf
of the International Managers specifically for inclusion in the
Registration Statement and the Prospectus.
11 DEFAULTING INTERNATIONAL MANAGERS.
If, on either Delivery Date, any International Manager defaults in the
performance of its obligations under this Agreement, the remaining
non-defaulting International Managers shall be obligated to purchase the Stock
which the defaulting International Manager agreed but failed to purchase on such
Delivery Date in the respective proportions which the number of shares of the
Firm Stock set opposite the name of each remaining non-defaulting International
Manager in Schedule 1 hereto bears to the total number of shares of the Firm
Stock set opposite the names of all the remaining non-defaulting International
Managers in Schedule 1 hereto; PROVIDED, HOWEVER, that the remaining
non-defaulting International Managers shall not be obligated to purchase any of
the Stock on such Delivery Date if the total number of shares of the Stock which
the defaulting International Manager or International Managers agreed but failed
to purchase on such date exceeds 9.09% of the total number of shares of the
Stock to be purchased on such Delivery Date, and any remaining non-defaulting
International Manager shall not be obligated to purchase more than 110% of the
number of shares of the Stock which it agreed to purchase on such Delivery Date
pursuant to the terms of Section 3. If the foregoing maximums are exceeded, the
remaining non-defaulting International Managers, or those other underwriters
satisfactory to the Lead Managers who so agree, shall have the right, but shall
not be obligated, to purchase, in such proportion as may be agreed upon among
them, all the Stock to be purchased on such Delivery Date. If the remaining
International Managers or other underwriters satisfactory to the Lead Managers
do not elect to purchase the shares which the defaulting International Manager
or International Managers agreed but failed to purchase on such Delivery Date,
this Agreement (or, with respect to the Second Delivery Date, the obligation of
the International Managers to purchase, and of the Selling Stockholders to sell,
the Option Stock) shall terminate without liability on the part of any
non-defaulting International Manager or the Company or any Selling Stockholder,
except that
<PAGE>
32
the Company will continue to be liable for the payment of expenses to the extent
set forth in Sections 8 and 13. As used in this Agreement, the term
"International Manager" includes, for all purposes of this Agreement unless the
context requires otherwise, any party not listed in Schedule 1 hereto who,
pursuant to this Section 11, purchases Stock which a defaulting International
Manager agreed but failed to purchase.
Nothing contained herein shall relieve a defaulting International
Manager of any liability it may have to the Company and the Selling Stockholders
for damages caused by its default. If other underwriters are obligated or agree
to purchase the Stock of a defaulting or withdrawing International Manager,
either the Lead Managers or the Company may postpone the Delivery Date for up to
seven full business days in order to effect any changes that in the opinion of
counsel for the Company or counsel for the International Managers may be
necessary in the Registration Statement, the Prospectus or in any other document
or arrangement.
12 TERMINATION. The obligations of the International Managers
hereunder may be terminated by the Lead Managers by notice given to and received
by the Company and each of the Selling Stockholders prior to delivery of and
payment for the Firm Stock if, prior to that time, any of the events described
in Sections 9(l) or 9(m) shall have occurred or if the International Managers
shall decline to purchase the Stock for any reason permitted under this
Agreement.
13 REIMBURSEMENT OF INTERNATIONAL MANAGERS' EXPENSES. If this
Agreement is terminated pursuant to Section 11 by reason of the default of one
or more International Managers, neither the Company nor any Selling Stockholder
shall be obligated to reimburse any defaulting International Manager on account
of those expenses. This provision shall not affect the allocation of such
expenses between the Company and the Selling Stockholders pursuant to the
Registration Rights Agreement.
14 NOTICES, ETC. All statements, requests, notices and agreements
hereunder shall be in writing, and:
(a) if to the International Managers, shall be delivered or sent
by mail, telex or facsimile transmission to Lehman Brothers International
(Europe), Three World Financial Center, New York, New York 10285,
Attention: Syndicate Department (Fax: 212-526-6588), with a copy, in the
case of any notice pursuant to Section 10(c), to the Director of
Litigation, Office of the General Counsel, Lehman Brothers Inc., Three
World Financial Center, 10th Floor, New York, New York 10285;
(b) if to the Company, shall be delivered or sent by mail, telex
or facsimile transmission to the address of the Company set forth in the
Registration Statement, Attention: General Counsel (Fax: 813-871-4430);
and
<PAGE>
33
(c) if to a Selling Stockholder, shall be delivered or sent by
mail, telex or facsimile transmission to such Selling Stockholder at the
address or facsimile number set forth on Schedule 2 hereto;
PROVIDED, HOWEVER, that any notice to an International Manager pursuant to
Section 10(d) shall be delivered or sent by mail, telex or facsimile
transmission to such International Manager at its address set forth in its
acceptance telex to the Lead Managers, which address will be supplied to any
other party hereto by the Lead Managers upon request. Any such statements,
requests, notices or agreements shall take effect at the time of receipt
thereof. The Company and the Selling Stockholders shall be entitled to act and
rely upon any request, consent, notice or agreement given or made on behalf of
the International Managers by Lehman Brothers International on behalf of the
Lead Managers.
15 PERSONS ENTITLED TO BENEFIT OF AGREEMENT. This Agreement
shall inure to the benefit of and be binding upon the International Managers,
the Company, the Selling Stockholders, their trustees and their respective
successors. This Agreement and the terms and provisions hereof are for the
sole benefit of only those persons, except that (A) the representations,
warranties, indemnities and agreements of the Company and each of the Selling
Stockholders contained in this Agreement shall also be deemed to be for the
benefit of the person or persons, if any, who control any International
Manager or any Selling Stockholder within the meaning of Section 15 of the
Securities Act and for the benefit of each U.S. Underwriter (and controlling
persons thereof) who offers or sells any shares of Common Stock in accordance
with the terms of the Agreement Between U.S. Underwriters and International
Managers and (B) the indemnity agreement of the International Managers
contained in Section 10(c) of this Agreement shall be deemed to be for the
benefit of directors of the Company, the officers of the Company who have
signed the Registration Statement, the Selling Stockholders, their directors
and trustees and any person controlling the Company or a Selling Stockholder
within the meaning of Section 15 of the Securities Act. Nothing in this
Agreement is intended or shall be construed to give any person, other than
the persons referred to in this Section 15, any legal or equitable right,
remedy or claim under or in respect of this Agreement or any provision
contained herein.
16 SURVIVAL. The respective indemnities, representations,
warranties and agreements of the Company, the Selling Stockholders and the
International Managers contained in this Agreement or made by or on behalf on
them, respectively, pursuant to this Agreement, shall survive the delivery of
and payment for the Stock and shall remain in full force and effect, regardless
of any investigation made by or on behalf of any of them or any person
controlling any of them.
17 DEFINITION OF THE TERMS "BUSINESS DAY" AND "SUBSIDIARY." For
purposes of this Agreement, (a) "business day" means each Monday, Tuesday,
Wednesday, Thursday or Friday which is not a day on which banking institutions
in New York are generally authorized or obligated by law or executive order to
close and (b) "subsidiary" has the meaning set forth in Rule 405 of the Rules
and Regulations.
<PAGE>
34
18 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF NEW YORK.
19 COUNTERPARTS. This Agreement may be executed in one or more
counterparts and, if executed in more than one counterpart, the executed
counterparts shall each be deemed to be an original but all such counterparts
shall together constitute one and the same instrument.
20 HEADINGS. The headings herein are inserted for convenience of
reference only and are not intended to be part of, or to affect the meaning or
interpretation of, this Agreement.
[signature pages follow]
<PAGE>
35
If the foregoing correctly sets forth the agreement among the Company,
the Selling Stockholders and the International Managers, please indicate your
acceptance in the space provided for that purpose below.
Very truly yours,
WALTER INDUSTRIES, INC.
By ______________________________
NAME:
TITLE:
LEHMAN BROTHERS HOLDINGS INC.
By ______________________________
NAME:
TITLE:
ASBESTOS SETTLEMENT TRUST
By ______________________________
NAME:
TITLE:
<PAGE>
36
Accepted:
LEHMAN BROTHERS INTERNATIONAL (EUROPE)
DONALDSON, LUFKIN & JENRETTE INTERNATIONAL
MERRILL LYNCH INTERNATIONAL
SMITH BARNEY INC.
ARNHOLD and S. BLEICHROEDER, INC.
For themselves and as Lead Managers
of the several International Managers named
in Schedule 1 hereto
By LEHMAN BROTHERS INTERNATIONAL (EUROPE)
By
--------------------------------------
AUTHORIZED LEAD MANAGER
<PAGE>
37
SCHEDULE 1
INTERNATIONAL MANAGER NUMBER OF SHARES
Lehman Brothers International (Europe) . . . . .
Donaldson, Lufkin & Jenrette International . . .
Merrill Lynch International . . . . . . .
Smith Barney Inc. . . . . . . . . . . . . . . . . . . . . .
Arnhold and S. Bleichroeder, Inc. . . . . . . . . . . . . .
_________
Total . . . . . . . . . . . . . . . . . . . . . 2,000,000
---------
---------
<PAGE>
38
SCHEDULE 2
Name and Address of Number of Shares Number of Shares
Selling Stockholder of Firm Stock of Option Stock
The Asbestos Settlement Trust . . . . . 1,400,000 300,000
9 Burr Road
Westport, CT 06880
Attention:
Facsimile:
Lehman Brothers Holdings Inc. . . . . . 600,000 0
Three World Financial Center
New York, NY 10285
Attention: Steven L. Berkenfeld or
Kevin R. Genirs
Facsimile: (212) 526-2198 ______________ _______________
Total. . . . . . . . . . . . . . . . . .2,000,000 300,000
--------- -------
--------- -------
<PAGE>
39
SCHEDULE 3
Persons from whom "Lock-Up"
Letters will be Received
(In addition to the Company's
Executive Officers and Directors)
PURSUANT TO SECTION 6(H)
Channel One Associates, L.P.
JWC Associates, L.P.
JWC Associates II, L.P.
KKR Partners II, L.P.
<PAGE>
EXHIBIT 23(A)
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
We hereby consent to the incorporation by reference in the Prospectus
constituting part of this Post Effective Amendment No. 8 to the Registration
Statement on Form S-3 of our report dated July 10, 1997, appearing on page F-2
of Walter Industries, Inc., Annual Report on Form 10-K/A Amendment No. 1 for the
year ended May 31, 1997. We also consent to the incorporation by reference of
our report on the Financial Statement Schedules appearing on page F-29 of such
Annual Report on Form 10-K/A Amendment No. 1. We also consent to the references
to us under the heading "Experts" in such Prospectus.
/s/ Price Waterhouse LLP
Price Waterhouse LLP
Tampa, Florida
January 29, 1998
<PAGE>
Exhibit 23(b)
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this Registration Statement of our report dated December 19, 1997,
appearing in the Current Report on Form 8-K/A of Walter Industries, Inc. filed
with the Securities and Exchange Commission pursuant to the Securities Exchange
Act of 1934. We also consent to the references to us under the heading "Experts"
in such Registration Statement.
/s/ Arthur Andersen LLP
ARTHUR ANDERSEN LLP
Denver, Colorado,
January 28, 1998.
