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EXHIBIT 1.2
▇▇▇▇▇ WHEELS INTERNATIONAL, INC.
$150,000,000
9 1/8% Senior Subordinated Notes due 2007
PURCHASE AGREEMENT
July 16, 1997
CIBC WOOD GUNDY SECURITIES CORP.
▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇ INCORPORATED
c/o CIBC Wood Gundy Securities Corp.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
▇▇▇▇▇ Wheels International, Inc., a Delaware corporation (the
"Company"), and each of the Company's subsidiaries listed in Exhibit A hereto
(each, a "Subsidiary Guarantor" and, collectively, the "Subsidiary Guarantors"
and, together with the Company, the "Issuers") hereby confirm their agreement
with you (the "Initial Purchasers"), as set forth below.
1. The Securities. Subject to the terms and conditions herein
contained, the Company proposes to issue and sell to the Initial Purchasers
$150,000,000 aggregate principal amount of its 9 1/8% Senior Subordinated Notes
due 2007 (the "Notes"). The obligations of the Company under the Indenture
(as hereinafter defined) and the Notes will be unconditionally guaranteed (the
"Guarantees"), on a joint and several basis, by each Subsidiary Guarantor. The
Notes and the Guarantees are to be issued pursuant to the Indenture (the
"Indenture"), dated July 15, 1997, among the Company, The Bank of New York, a
New York corporation, as trustee (the "Trustee"), and the Subsidiary
Guarantors. The Notes and the Guarantees are hereinafter referred to
collectively as the "Securities."
The sale of the Securities to the Initial Purchasers (the "Offering")
will be made without registration of the Securities under the Securities Act of
1933, as amended, (the "Act") and the rules and regulations of the Securities
and Exchange Commission (the "Commission") thereunder, in reliance upon the
exemption therefrom provided by Section 4(2) of the Act. Holders of the
Securities will have the benefits of a Registration Rights Agreement to be
dated as of July 15, 1997
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among the Issuers and the Initial Purchasers (the "Registration Rights
Agreement").
In connection with the sale of the Securities, the Company has
prepared an offering memorandum dated July 16, 1997 (the "Memorandum") setting
forth or including a description of the terms of the Securities, the terms of
the Offering, a description of the Company and any material developments
relating to the Company occurring after the date of the most recent financial
statements included therein.
The Securities are being issued and sold in connection with the
repayment of certain indebtedness outstanding under the Company's senior
secured term loan facility (as amended, the "Amended Credit Agreement")
among the Company, Canadian Imperial Bank of Commerce, as administrative agent,
▇▇▇▇▇▇▇ Capital Corporation, as documentation agent, and the other financial
institutions party thereto, as lenders which will be further amended on or
prior to the closing date.
This Agreement, the Securities, the Exchange Notes (as defined in the
Registration Rights Agreement), the Private Exchange Notes (as defined in the
Registration Rights Agreement), the Registration Rights Agreement and the
Indenture are herein collectively referred to as the "Offering Documents."
2. Representations and Warranties of the Issuers. The Issuers,
jointly and severally, represent and warrant to and agree with the Initial
Purchasers that:
(a) The Memorandum, as of its date and at the Closing Date (as
defined in Section 3 hereof), did not and will not contain any untrue
statement of a material fact or omit to state a material fact necessary
in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading, except that the
representations and warranties set forth in this Section 2(a) do not
apply to statements or omissions that are made in reliance upon and in
conformity with information relating to the Initial Purchasers furnished
to the Company in writing by the Initial Purchasers expressly for use in
the Memorandum or any amendment or supplement thereto, which information
is set forth in Section 15.
(b) Each of the Issuers and the Subsidiaries (as hereinafter
defined) that is a corporation organized under the laws of a jurisdiction
of the United States has been and at and as of the Closing Date will be
duly incorpo-
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rated and each of the Issuers and each Subsidiary that is a corporation
organized under the laws of a jurisdiction of the United States is and at
and as of the Closing Date will be validly existing in good standing as a
corporation under the laws of its jurisdiction of incorporation, with the
requisite corporate power and authority to own its properties and conduct
its business as now conducted as described in the Memorandum, is and at
and as of the Closing Date will be duly qualified to do business as a
foreign corporation in good standing in all other jurisdictions where the
ownership or leasing of its properties or the conduct of its business
requires such qualification, except where the failure to be so qualified
would not, individually or in the aggregate, have a material adverse
effect on the business, condition (financial or other) or results of
operations of any of the Issuers and the Subsidiaries, taken as a whole
(any such event a "Material Adverse Effect"); each of the Issuers and the
Subsidiaries that is not a corporation organized under the laws of a
jurisdiction of the United States, has been and at and as of the Closing
Date will be duly organized and validly existing under the laws of the
jurisdiction in which it is so organized, with the requisite power and
authority to own its properties and conduct its business as now conducted
and as described in the Memorandum; the Company had as of the date
specified therein the authorized, issued and outstanding capitalization
set forth in the Memorandum; except as set forth in Exhibit B hereto and
for the Subsidiary Guarantors (collectively, the "Subsidiaries"), the
Company does not have any subsidiaries or own directly or indirectly any
of the capital stock or other equity securities of any other person; all
of the outstanding shares of capital stock of the Issuers and the
Subsidiaries have been, duly authorized and validly issued, are fully
paid and nonassessable and were not issued in violation of any preemptive
or similar rights and, in the case of the Subsidiary Guarantors and the
Subsidiaries, are owned free and clear of all liens, encumbrances,
equities and restrictions on transferability (other than those imposed by
the Act and the state securities or "Blue Sky" laws); except as set forth
in the Memorandum, no options, warrants or other rights to purchase from
any Issuer or any Subsidiary, agreements or other obligations of any
Issuer or any Subsidiary or other rights to convert any obligation into,
or exchange any securities for, shares of capital stock of or ownership
interests in any Issuer or any Subsidiary are outstanding.
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(c) Each of the Issuers has the required corporate power and
authority to execute, deliver and perform its obligations under the
Indenture, the Securities, the Exchange Notes and the Private Exchange
Notes. The Securities, the Exchange Notes, the Private Exchange Notes
and the guarantees to be endorsed thereon have each been duly and validly
authorized by each of the Issuers for issuance and, when executed by the
Issuers and authenticated by the Trustee in accordance with the
provisions of the Indenture and, in the case of the Securities, delivered
to and paid for by the Initial Purchasers in accordance with the terms
hereof, will have been duly executed, issued and delivered and will
constitute valid and legally binding obligations of the Issuers, entitled
to the benefits of the Indenture and enforceable against the Issuers in
accordance with their terms except that the enforcement thereof may be
limited by (i) bankruptcy, insolvency, reorganization, moratorium or
other similar laws now or hereafter in effect relating to or affecting
creditors' rights generally or (ii) general principles of equity
(regardless of whether such enforcement is considered in a proceeding at
law or in equity); each of the Issuers has all requisite corporate power
and authority to execute, deliver and perform its obligations under the
Indenture, the Securities, the Exchange Notes and the Private Exchange
Notes, and the Indenture has been duly and validly authorized by the
Issuers and is in a form to be qualified under the Trust Indenture Act of
1939, as amended (the "TIA") and, when executed and delivered by the
Issuers (assuming the due authorization, execution and delivery by the
Trustee), will constitute a valid and legally binding agreement of the
Issuers, enforceable against the Issuers in accordance with its terms
except that the enforcement thereof may be limited by (i) bankruptcy,
insolvency, reorganization, moratorium or other similar laws now or
hereafter in effect relating to or affecting creditors' rights generally
or (ii) general principles of equity (regardless of whether such
enforcement is considered in a proceeding at law or in equity).
(d) Each of the Issuers has the requisite corporate power and
authority to execute, deliver and perform its obligations under the
Registration Rights Agreement. The Registration Rights Agreement has
been duly and validly authorized by the Issuers and, when executed and
delivered by the Issuers (assuming the due authorization, execution and
delivery by the Initial Purchasers), will constitute a valid and legally
binding agreement of the Issuers, en-
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forceable against the Issuers in accordance with its terms except (i)
that the enforcement thereof may be subject to bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in
effect relating to or affecting creditors' rights generally, or general
principles of equity (regardless of whether such enforcement is
considered in a proceeding at law or in equity) and (ii) as any rights to
indemnity or contribution thereunder may be limited by federal and state
securities laws and public policy considerations.
(e) Each of the Issuers has the requisite corporate power and
authority to execute, deliver and perform its obligations under this
Agreement. This Agreement has been duly and validly authorized by the
Issuers and, when executed and delivered by the Issuers, will constitute
a valid and legally binding agreement of the Issuers, enforceable against
the Issuers in accordance with its terms except (i) that the enforcement
thereof may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws now or hereafter in effect relating to
or affecting creditors' rights generally or general principles of equity
(regardless of whether such enforcement is considered in a proceeding at
law or in equity) and (ii) as any rights to indemnity or contribution
hereunder may be limited by federal and state securities laws and public
policy considerations.
(f) Except as set forth in the Memorandum, no consent, approval,
authorization or order of any court or governmental agency or body is
required for the performance of any of the Offering Documents by the
Issuers or, to the extent each is or will be a party thereto, or for the
consummation by the Issuers or, of any of the transactions contemplated
thereby, except for such consents, approvals, authorizations or orders as
have been obtained or made or as may be required under the Act and the
TIA (with respect to the transactions contemplated by the Registration
Rights Agreement) or as may be required under state securities or "Blue
Sky" laws in connection with the purchase and distribution of the
Securities by the Initial Purchasers; and none of the Issuers or, is (i)
in violation of its certificate of incorporation or bylaws, (ii) in
violation of any statute, judgment, decree, order, rule or regulation
applicable to it or any of its properties or assets, which violation
would, individually or in the aggregate, have a Material Adverse Effect,
or (iii) in default in the performance or observance of any obliga-
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tion, agreement, covenant or condition contained in any of the Offering
Documents or any other contract, indenture, mortgage, deed of trust, loan
agreement, note, lease, license, franchise agreement, permit, certificate
or agreement or instrument to which it is a party or to which it is
subject, which default would, individually or in the aggregate, have a
Material Adverse Effect.
(g) The execution, delivery and performance by the Issuers of each
of the Offering Documents to which it is a party, and the consummation by
the Issuers of the transactions contemplated thereby and the fulfillment
of the terms thereof, will not violate, conflict with or constitute or
result in a breach of or a default under (or an event that, with notice
or lapse of time, or both, would constitute a breach of or a default
under) any of (a) the terms or provisions of any indenture, mortgage,
deed of trust, loan agreement, note, lease, license, franchise agreement,
or agreement or instrument to which any of the Issuers or the
Subsidiaries is a party or to which any of their respective properties or
assets are subject, which violation, conflict, breach or default would,
individually or in the aggregate, have a Material Adverse Effect, (b) the
certificate of incorporation or bylaws of any of the Issuers or the
Subsidiaries or (c) (assuming compliance with all applicable Federal and
state securities and "Blue Sky" laws) any statute, judgment, decree,
order, rule or regulation of any court or governmental agency or other
body applicable to the Issuers or the Subsidiaries or any of their
respective properties or assets, which violation, conflict, breach or
default would, individually or in the aggregate, have a Material Adverse
Effect.
(h) The audited consolidated financial statements and schedules of
each of the Company and Lemmerz included in the Memorandum present fairly
the consolidated financial position, results of operations and cash flows
of the Company and Lemmerz, at the dates and for the periods to which
they relate and have been prepared in accordance with generally accepted
accounting principles applied on a consistent basis, except as otherwise
stated therein; the unaudited consolidated financial statements and the
related notes of the Company and Lemmerz included in the Memorandum
present fairly the consolidated financial position, results of operations
and cash flows of the Company and Lemmerz at the dates and for the
periods to which they relate, subject to year-end audit adjustments, and
have been prepared in accordance with generally accepted ac-
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counting principles applied on a consistent basis except as otherwise
stated therein and have been prepared on a basis substantially consistent
with that of the audited financial statements referred to above except as
otherwise stated therein; to the best knowledge of the Company, after due
inquiry, the summary and selected financial and statistical data included
in the Memorandum present fairly the information shown therein and have
been prepared and compiled on a basis consistent with the audited and
unaudited financial statements included therein, except as otherwise
stated therein; and KPMG Peat Marwick LLP and KPMG Deutsche
Treuhand-Gesellschaft Aktiengesellschaft Wirtschaftsprufungsgesellschaft,
which have examined certain of such financial statements and schedules as
set forth in their reports included in the Memorandum, are independent
public accounting firms as required by the Act.
(i) (i) The pro forma financial statements and other pro forma
financial information (including the notes thereto) included in the
Memorandum (A) have been prepared in accordance with applicable
requirements of Rule 11-02 of Regulation S-X promulgated under the Act
and (B) have been properly computed on the bases described therein; (ii)
the assumptions used in the preparation of the pro forma financial
statements and other pro forma financial information included in the
Memorandum are reasonable and the adjustments used therein are
appropriate to give effect to the transactions or circumstances referred
to therein.
(j) Except as described in the Memorandum, there is not pending
or, to the best knowledge of the Issuers, threatened any action, suit,
proceeding, inquiry or investigation, governmental or otherwise, to which
any of the Issuers or the Subsidiaries is a party, or to which their
respective properties or assets are subject, before or brought by any
court, arbitrator or governmental agency or body, that, if determined
adversely to the Issuers or the Subsidiaries, would, individually or in
the aggregate, have a Material Adverse Effect or that seeks to restrain,
enjoin, prevent the consummation of or otherwise challenge the issuance
or sale of the Securities to be sold hereunder or the consummation of the
transactions described in the Memorandum under the captions "Use of
Proceeds."
(k) The Issuers and the Subsidiaries possess adequate licenses or
other rights to use all patents, trade-
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marks, service marks, trade names, copyrights and know-how (i) that are
necessary to conduct their business as described in the Memorandum and
(ii) the loss of which would, individually or in the aggregate, have a
Material Adverse Effect.
(l) None of the Issuers or the Subsidiaries has received any notice
of infringement of or conflict with (or knows of any such infringement of
or conflict with) asserted rights of others with respect to any patents,
trademarks, service marks, trade names, copyrights or know-how that, if
such assertion of infringement or conflict were sustained, would,
individually or in the aggregate, have a Material Adverse Effect.
(m) Each of the Issuers and the Subsidiaries has obtained all
licenses, permits, franchises and other governmental authorizations, the
lack of which would, individually or in the aggregate, have a Material
Adverse Effect.
(n) Subsequent to the respective dates as of which information is
given in the Memorandum and except as described therein, (i) the Issuers
and the Subsidiaries have not incurred any material liabilities or
obligations, direct or contingent, or entered into any material
transactions, in either case whether or not in the ordinary course of
business, and (ii) the Issuers and the Subsidiaries have not purchased
any of their respective outstanding capital stock, or declared, paid or
otherwise made any dividend or distribution of any kind on any of their
respective capital stock or otherwise.
(o) None of the Issuers or the Subsidiaries has taken or will take
any action that would cause this Agreement or the issuance or sale of the
Securities to violate Regulation G, T, U or X of the Board of Governors
of the Federal Reserve System, in each case as in effect, or as the same
may hereafter be in effect, on the Closing Date.
(p) Each of the Issuers and the Subsidiaries has good and
marketable title to all real property described in the Memorandum as
being owned by it and good and marketable title to the leasehold estate
in the real property described therein as being leased by it, free and
clear of all liens, charges, encumbrances or restrictions, except, in
each case, as described in the Memorandum or such as would not,
individually or in the aggregate, have a Material Adverse Effect.
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(q) Each of the Issuers and the Subsidiaries has filed all necessary
federal, state and foreign income and franchise tax returns, except where
the failure to so file such returns would not, individually or in the
aggregate, have a Material Adverse Effect; and, other than taxes due
thereon or tax deficiencies which any Issuer or Subsidiary reasonably
believe that it has provided adequate reserves, has paid all taxes due
thereon and there is no tax deficiency that has been asserted against any
Issuer or Subsidiary that would, individually or in the aggregate, have a
Material Adverse Effect.
(r) (i) Immediately after the consummation of the transactions
contemplated by this Agreement (including the use of proceeds from the
sale of Securities on the Closing Date), the fair value and present fair
saleable value of the assets of the Company will exceed the sum of its
stated liabilities and identified contingent liabilities; and (ii) the
Company is not, nor will it be, after giving effect to the execution,
delivery and performance of the Offering Documents, to the extent it is a
party thereto, and the consummation of the transactions contemplated
thereby, (a) left with unreasonably small capital with which to carry on
its business as it is proposed to be conducted, (b) unable to pay its
debts (contingent or otherwise) as they mature or (c) insolvent.
(s) Assuming the accuracy of the Initial Purchasers'
representations and warranties set forth in Section 5 hereof, and the due
performance by the Initial Purchasers of the covenants and agreements set
forth in Section 5 hereof, the offer and sale of the Securities to the
Initial Purchasers in the manner contemplated by this Agreement and the
Memorandum does not require registration under the Act and the Indenture
does not require qualification under the TIA.
(t) No securities of the Company or any of its Subsidiaries are (i)
of the same class (within the meaning of Rule 144A under the Act) as the
Securities and (ii) listed on a national securities exchange registered
under Section 6 of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), or quoted in a U.S. automated interdealer quotation
system.
(u) None of the Issuers or the Subsidiaries, any of their
respective Affiliates or any person acting on their behalf (other than
the Initial Purchasers) has, engaged in
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any directed selling efforts (as that term is defined in Regulation S
under the Act ("Regulation S")) with respect to the Securities; and the
Issuers, the Subsidiaries, their respective Affiliates and any person
acting on their behalf (other than the Initial Purchasers) have acted in
accordance with the offering restrictions requirements of Regulation S.
(v) Except as disclosed in the Memorandum and except as would not
individually or in the aggregate have a Material Adverse Effect, (A) each
of the Issuers and the Subsidiaries is in compliance with all applicable
Environmental Laws, (B) each of the Issuers and the Subsidiaries has made
all filings and provided all notices required under any applicable
Environmental Law, and has all permits, authorizations and approvals
required under any applicable Environmental Laws and is in compliance
with their requirements, (C) there are no pending or, to the best
knowledge of the Issuers, after due inquiry, threatened Environmental
Claims against any of the Issuers or the Subsidiaries and (D) none of the
Issuers or the Subsidiaries has knowledge of any circumstances with
respect to any of their respective properties or operations that could
reasonably be anticipated to form the basis of an Environmental Claim
against any of them or any of their subsidiaries or any of their
respective properties or operations and the business operations relating
thereto which Environmental Claims would, individually or in the
aggregate, have a Material Adverse Effect.
For purposes of this Agreement, the following terms shall have the
following meanings: "Environmental Law" means any federal, state, local
or municipal statute, law, rule, regulation, ordinance, code or rule and
any judicial or administrative interpretation thereof, including any
judicial or administrative order, consent decree or judgment binding on
any of the Issuers or the Subsidiaries relating to pollution or
protection of the environment or health or safety or any chemical,
material or substance that is subject to regulation thereunder.
"Environmental Claims" means any and all administrative, regulatory or
judicial actions, suits, demands, demand letters, claims, written notices
of responsibility, information requests, liens, written notices of
noncompliance or violation, investigations or proceedings relating in any
way to any Environmental Law.
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(w) None of the Issuers or the Subsidiaries is required to
register as an "investment company" or a company "controlled by" an
"investment company" within the meaning of the Investment Company
Act of 1940, as amended.
(x) Except as stated in the Memorandum, none of the Issuers or the
Subsidiaries or any of their directors, officers or controlling persons,
has taken, directly or indirectly, any action designed, or that might
reasonably be expected, to cause or result, under the Act or otherwise,
in, or that has constituted, stabilization or manipulation of the price
of any security of any Issuer to facilitate the sale or resale of the
Securities (it being understood that no representation or warranty is
made as to any actions by the Initial Purchasers).
3. Purchase, Sale and Delivery of the Securities. On the basis of
the representations, warranties, agreements and covenants herein contained and
subject to the terms and conditions herein set forth, the Issuers agree to
issue and sell to the Initial Purchasers, and each of the Initial Purchasers
severally agrees to purchase from the Issuers, at 97.5% of their principal
amount, the respective aggregate principal amounts of the Securities set forth
opposite their respective names on Exhibit C hereto. The obligations of the
Initial Purchasers under this Agreement are several and not joint. One or more
certificates in definitive form for the Securities that the Initial Purchasers
have agreed to purchase hereunder, and in such denomination or denominations
and registered in such name or names as each Initial Purchaser requests upon
notice to the Company at least 48 hours prior to the Closing Date, shall be
delivered by or on behalf of the Company, against payment by or on behalf of
the Initial Purchasers of the purchase price therefor by wire transfer of
immediately available funds net of the overnight cost of such funds to the
account of the Company previously designated by it in writing. Such delivery
of and payment for the Securities shall be made at the offices of ▇▇▇▇▇▇ ▇▇▇▇▇▇
& ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, at 9:00 a.m., New York
time, on July 22, 1997, or at such date as the Initial Purchasers and the
Company may agree upon, such time and date of delivery against payment being
herein referred to as the "Closing Date." The Company will make such
certificate or certificates for the Securities available for checking and
packaging by the Initial Purchasers at the offices in New York, New York of
CIBC Wood Gundy Securities Corp. at least 24 hours prior to the Closing Date.
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4. Registration Rights of Holders of Securities. The Initial
Purchasers and their direct and indirect transferees of the Securities will
have such rights with respect to the registration thereof under the Act and
qualification of the Indenture under the TIA as are set forth in the
Registration Rights Agreement.
5. Resale of Securities. Each Initial Purchaser represents and
warrants to, and agrees with, the Company that (a) it is a "qualified
institutional buyer" as defined in Rule 144A under the Act ("QIB"); (b) it
has not and will not, directly or indirectly, solicit offers for, or offer or
sell, the Securities by any form of general solicitation or general advertising
(as those terms are used in Regulation D under the Act) or in any manner
involving a public offering within the meaning of Section 4(2) of the Act; (c)
it has not and will not, directly or indirectly, engage in any "directed
selling efforts" (as defined in Regulation S under the Act); and (d) it has and
will solicit offers for the Securities only from, and will offer, sell and
deliver the Securities only to, (A) in the case of offers inside the United
States, (i) persons whom such Initial Purchasers reasonably believe to be QIBs
or, if any such person is buying for one or more institutional accounts for
which such person is acting as fiduciary or agent, only when such person has
represented to such Initial Purchasers that each such account is a QIB to whom
notice has been given that such sale or delivery is being made in reliance on
Rule 144A or (ii) a limited number of other institutional investors each of
which is reasonably believed by the Initial Purchaser to be an "accredited
investor" (as defined in Rule 501(a)(1)(2), (3) or (7) of the Act) that, prior
to their purchase of the Securities, deliver to the Initial Purchaser a letter
containing the representations and agreements set forth in Annex I to the
Memorandum and (B) in the case of offers outside the United States, to persons
other than U.S. Persons in compliance with Regulation S under the Act ("foreign
purchasers," which terms shall include dealers or other professional
fiduciaries in the United States acting on a discretionary basis for foreign
beneficial owners (other than an estate or trust)); provided, however, that, in
the case of this clause (B), in purchasing such Securities such persons are
deemed to have represented and agreed as provided under the caption "Notice to
Investors" contained in the Memorandum.
6. Certain Covenants. The Issuers, jointly and severally, covenant
and agree with the Initial Purchasers that:
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(a) None of the Issuers will amend or supplement the Memorandum or
any amendment or supplement thereto of which the Initial Purchasers shall
not previously have been advised and furnished a copy for a reasonable
period of time prior to the proposed amendment or supplement and as to
which the Initial Purchasers or counsel for the Initial Purchasers shall
reasonably object. The Issuers will promptly, upon the reasonable
request of the Initial Purchasers or counsel to the Initial Purchasers,
make any amendments or supplements to the Memorandum that may be
reasonably necessary or advisable in connection with the resale of the
Securities by the Initial Purchasers.
(b) The Issuers will cooperate with the Initial Purchasers in
arranging for the qualification of the Securities for offering and sale
under the securities or "Blue Sky" laws of such jurisdictions as the
Initial Purchasers may designate and will continue such qualifications in
effect for as long as may be necessary to complete the distribution of
the Securities by the Initial Purchasers; provided, however, that in
connection therewith none of the Issuers shall be required to qualify as
a foreign corporation or to execute a general consent to service of
process in any jurisdiction or to take any other action that would
subject it to general service of process or to taxation in respect of
doing business in any jurisdiction in which it is not otherwise subject.
(c) If, at any time prior to the completion of the distribution by
the Initial Purchasers of the Securities or, if issued, the Private
Exchange Notes, any event occurs or information becomes known as a result
of which the Memorandum as then amended or supplemented would include any
untrue statement of a material fact, or omit to state a material fact
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, or if for any
other reason it is necessary at any time to amend or supplement the
Memorandum to comply with applicable law, the Issuers will promptly
notify the Initial Purchasers thereof (who thereafter will not use such
Memorandum until appropriately amended or supplemented) and will prepare,
at the expense of the Issuers, an amendment or supplement to the
Memorandum that corrects such statement or omission or effects such
compliance.
(d) The Company will, without charge, provide to each Initial
Purchaser and to counsel to the Initial Pur-
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chasers as many copies of the Memorandum or any amendment or supplement
thereto as the Initial Purchasers may reasonably request.
(e) During the period of five years from the Closing Date, the
Company will furnish to the Initial Purchasers (a) as soon as available,
a copy of each report and other communication (financial or otherwise) of
the Company mailed to the Trustee or the holders of the Securities,
stockholders or filed with the Commission or any national securities
exchange on which any class of securities of the Company may be listed
and (b) from time to time such other information concerning the Company
as you may reasonably request.
(f) If this Agreement shall terminate or shall be terminated after
execution pursuant to any provisions hereof (other than solely by reason
of a default by the Initial Purchasers of their obligations hereunder
after all conditions hereunder have been satisfied in accordance
herewith) or if this Agreement shall be terminated by the Initial
Purchasers because of any failure or refusal on the part of the Issuers
to comply with the terms or fulfill any of the conditions of this
Agreement, the Company agrees to reimburse you for all reasonable
out-of-pocket expenses (including fees and expenses of counsel for the
Initial Purchasers) incurred by you in connection herewith.
(g) The Company will apply the net proceeds from the sale of the
Securities as set forth under "Use of Proceeds" in the Memorandum.
(h) Prior to the Closing Date, the Company will furnish to the
Initial Purchasers, as soon as they have been prepared by or are
available to the Company, a copy of any unaudited interim consolidated
financial statements of the Company for any period subsequent to the
period covered by the most recent financial statements appearing in the
Memorandum.
(i) None of the Issuers or any of their respective Affiliates will
sell, offer for sale or solicit offers to buy or otherwise negotiate in
respect of any "security" (as defined in the Act) which could be
integrated with the sale of the Securities in a manner which would
require the registration under the Act of the Securities.
15
-15-
(j) The Issuers will not, and will not permit any of the
Subsidiaries to, solicit any offer to buy or offer to sell the Securities
by means of any form of general solicitation or general advertising (as
those terms are used in Regulation D under the Act) or in any manner
involving a public offering within the meaning of Section 4(2) of the Act.
(k) For so long as any of the Securities remain outstanding and are
"restricted securities" within the meaning of Rule 144(a)(3) under the
Act and not able to be sold in their entirety under Rule 144 under the
Act (or any successor provision), the Company will make available, upon
request, to any seller of such Securities the information specified in
Rule 144A(d)(4) under the Act, unless the Company is then subject to
Section 13 or 15(d) of the Exchange Act.
(l) The Issuers will use their best efforts to (i) permit the
Securities to be included for quotation on the Private Offering, Resales,
and Trading through Automated Linkages Market ("PORTAL") and (ii) permit
the Securities to be eligible for clearance and settlement through The
Depository Trust Company ("DTC").
(m) In connection with Securities offered and sold in an offshore
transaction (as defined in Regulation S), the Company will not register
any transfer of such Securities not made in accordance with the
provisions of Regulation S and will not, except in accordance with the
provisions of Regulation S, if applicable, issue any such Securities in
the form of definitive securities.
7. Expenses. Notwithstanding any termination of this Agreement
(pursuant to Section 11 or otherwise), the Company agrees to pay the following
costs and expenses and all other costs and expenses incident to the performance
by the Issuers of their obligations hereunder: (i) the preparation, printing
or reproduction of the Memorandum, (including financial statements) and each
amendment or supplement to it; (ii) the printing (or reproduction) and delivery
(including postage, air freight charges and charges for counting and packaging)
of such copies of the Memorandum and all amendments or supplements to it as may
be reasonably requested for use in connection with the offering and sale of the
Securities; (iii) the preparation, printing, authentication, issuance and
delivery of certificates for the Securities, including any stamp taxes in
connection with the original issuance and sale
16
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of the Securities and trustees' fees; (iv) the reproduction and delivery of
this Agreement, the preliminary and supplemental "Blue Sky" memoranda,
including filing fees and reasonable fees and disbursements of ▇▇▇▇▇▇ ▇▇▇▇▇▇ &
▇▇▇▇▇▇▇, counsel to the Initial Purchasers, relating thereto, and all other
agreements or documents reproduced and delivered in connection with the
offering of the Securities; (v) the registration or qualification of the
Securities for offer and sale under the securities or Blue Sky laws of the
several states (including the reasonable fees, expenses and disbursements of
counsel to the Initial Purchasers relating to such registration and
qualification); (vi) the transportation and other expenses incurred by or on
behalf of Company representatives in connection with presentations to
prospective purchasers of the Securities; (vii) the fees and expenses of the
Company's accountants and the fees and expenses of counsel (including local and
special counsel) for the Issuers; (viii) fees and expenses of the Trustee
including fees and expenses of its counsel; and (ix) any fees charged by
investment rating agencies for the rating of the Securities.
8. Conditions of the Initial Purchasers' Obligations. The several
obligations of the Initial Purchasers to purchase and pay for the Securities
are subject to the accuracy of the representations and warranties contained
herein, to the performance by the Issuers of their respective covenants and
agreements hereunder and to the following additional conditions unless waived
in writing by the Initial Purchasers:
(i) None of the issuance and sale of the Securities pursuant to this
Agreement or any other transactions contemplated by any of the Offering
Documents or the Memorandum shall be enjoined (temporarily or
permanently) and no restraining order or other injunctive order shall
have been issued; and there shall not have been any legal action, order,
decree or other administrative proceeding instituted or threatened
against any of the Issuers or against you relating to the issuance of the
Securities or the Initial Purchasers' activities in connection therewith,
or any other transaction contemplated by any of the Offering Documents or
the Memorandum.
(ii) Subsequent to the effective date of this Agreement, there shall
not have occurred (i) any change, or any development involving a
prospective change, in or affecting the condition (financial or other),
business, properties, prospects, net worth or results of operations of
the Issuers and the Subsidiaries, taken as a whole, not contemplated by
the Memorandum that, in your opinion, would
17
-17-
materially adversely affect the market for the Securities, or (ii) any
event or development relating to or involving any of the Issuers, the
Subsidiaries or any of the respective officers or directors of the
Issuers or the Subsidiaries that makes any statement made in the
Memorandum untrue or that, in the opinion of the Issuers and their
counsel or the Initial Purchasers and their counsel, requires the making
of any addition to or change in the Memorandum in order to state a
material fact necessary in order to make the statements made therein not
misleading or to comply with law.
(iii) The Initial Purchasers shall have received an opinion of
counsel to the Issuers in form and substance satisfactory to the Initial
Purchasers and counsel to the Initial Purchasers, dated the Closing Date,
of each of (i) Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP, substantially in
the form of Exhibit D-1 hereto, and (ii) ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esquire,
General Counsel to the Company substantially in the form of Exhibit D-2.
(iv) The Initial Purchasers shall have received an opinion, dated
the Closing Date, of ▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, counsel to the Initial
Purchasers, with respect to the sufficiency of certain legal matters
relating to this Agreement and such other related matters as the Initial
Purchasers may require. In rendering such opinion, ▇▇▇▇▇▇ ▇▇▇▇▇▇ &
▇▇▇▇▇▇▇ shall have received and may rely upon such certificates and other
documents and information as they may reasonably request to pass upon
such matters. In addition, in rendering their opinion, ▇▇▇▇▇▇ ▇▇▇▇▇▇ &
▇▇▇▇▇▇▇ may state that its opinion is limited to matters of New York,
Delaware corporate and federal law.
(v) The Initial Purchasers shall have received, from KPMG Peat
Marwick LLP, independent public accountants for the Issuers, and KPMG
Deutsche Treuhand-Gesellschaft Aktiengesellschaft
Wirtschaftsprufungsgesellschaft, independent public accountants for
Lemmerz Holding GmbH, a wholly-owned subsidiary of the Company
("Lemmerz"), "comfort" letters dated the date hereof and the Closing
Date, in form and substance reasonably satisfactory to the Initial
Purchasers and ▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, counsel to the Initial
Purchasers.
(vi) The representations and warranties of the Issuers contained in
this Agreement which are qualified as to materiality shall be true and
correct, and those represen-
18
-18-
tations and warranties of the Issuers which are not so qualified shall be
true and correct in all material respects, on and as of the Closing Date;
the Issuers shall have complied in all material respects with all
agreements and satisfied all conditions on their part to be performed or
satisfied hereunder at or prior to the Closing Date.
(vii) There shall not have been any change in the capital stock of
the Issuers nor any material increase in the consolidated short-term or
long-term debt of the Issuers, in each case, from that set forth or
contemplated in the Memorandum (or any amendment or supplement thereto)
and (b) the Issuers shall not have any liabilities or obligations,
contingent or otherwise (whether or not in the ordinary course of
business), that are material to the Issuers, taken as a whole, other than
those reflected in the Memorandum (or any amendment or supplement
thereto) or contemplated by the Offering Documents.
(viii) You shall have received certificates, dated the Closing Date
and signed by the chief executive officer and the chief financial officer
of the Company and each Subsidiary Guarantor (or such other officers as
are acceptable to you), to the effect that each of the conditions to
closing set forth in this Section 8 have been satisfied.
(ix) The Initial Purchasers shall have received on or before the
Closing Date from the Company a true and correct copy of an amendment to
the Amended Credit Agreement, in a form satisfactory to the Initial
Purchasers (the "Amendment"), which Amendment shall have been executed by
all necessary parties thereto and shall be in full force and effect.
(x) The Issuers shall have furnished or caused to be furnished to you
such further certificates and documents as you shall have reasonably
requested.
Any certificate or document signed by any officer of an Issuer and
delivered to you or to counsel for the Initial Purchasers shall be deemed a
representation and warranty by such Issuer to each Initial Purchaser as to the
statements made therein.
All such opinions, certificates, letters, schedules, documents or
instruments delivered pursuant to this Agreement will comply with the
provisions hereof only if they are reasonably satisfactory in all material
respects to the Initial
19
-19-
Purchasers and counsel to the Initial Purchasers. The Issuers shall furnish to
the Initial Purchasers such conformed copies of such opinions, certificates,
letters, schedules, documents and instruments in such quantities as the Initial
Purchasers shall reasonably request.
9. Indemnification and Contribution. (a) Each Issuer jointly and
severally agrees to indemnify and hold harmless each Initial Purchaser, and
each person, if any, who controls any of the Initial Purchasers within the
meaning of Section 15 of the Act or Section 20 of the Exchange Act, against any
losses, claims, damages or liabilities, joint or several, to which such Initial
Purchaser or such controlling person may become subject under the Act, the
Exchange Act or otherwise, insofar as any such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon:
(i) any untrue statement or alleged untrue statement of any material
fact contained in (A) the Memorandum or (B) any application or other
document, or any amendment or supplement thereto, executed by any Issuer
or based upon written information furnished by or on behalf of any Issuer
filed in any jurisdiction in order to qualify the Securities under the
securities or "Blue Sky" laws thereof or filed with the Commission or any
securities association or securities exchange (each an "Application"); or
(ii) the omission or alleged omission to state, in the Memorandum or
any amendment thereto, or any Application, a material fact required to be
stated therein or necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading,
and will reimburse, as incurred, each Initial Purchaser and each such
controlling person for any reasonable and documented out-of-pocket legal or
other expenses reasonably incurred by the Initial Purchasers or such
controlling person in connection with investigating, defending against or
appearing as a third-party witness in connection with any such loss, claim,
damage, liability or action;
provided, however, that none of the Issuers will be liable in any such case to
an Initial Purchaser or any controlling person of such Initial Purchaser to the
extent that any such loss, claim, damage or liability arises out of or is based
upon any untrue statement or alleged untrue statement or omission or alleged
omission made in the Memorandum or any amendment thereto or any Application in
reliance upon and in conformity with
20
-20-
written information furnished to the Issuers by or on behalf of such Initial
Purchaser specifically for use therein. This indemnity agreement will be in
addition to any liability that the Issuers may otherwise have to the
indemnified parties. None of the Issuers will, without the prior written
consent of the Initial Purchasers, which shall not be unreasonably withheld or
delayed, settle or compromise or consent to the entry of any judgment in any
pending or threatened claim, action, suit or proceeding in respect of which
indemnification by the Initial Purchasers may be sought hereunder (whether or
not the Initial Purchasers or any person who controls either of the Initial
Purchasers within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act is a party to such claim, action, suit or proceeding), unless such
settlement, compromise or consent includes an unconditional release (or any
other release reasonably acceptable to the Initial Purchasers) of the Initial
Purchasers and each such controlling person from all liability arising out of
such claim, action, suit or proceeding.
(b) Each Initial Purchaser will severally and not jointly indemnify and
hold harmless the Issuers, their respective directors, officers and each
person, if any, who controls any of the Issuers within the meaning of Section
15 of the Act or Section 20 of the Exchange Act against any losses, claims,
damages or liabilities to which any of the Issuers or any such director,
officer or controlling person may become subject under the Act, the Exchange
Act, or otherwise, insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of or are based upon (i) any untrue
statement or alleged untrue statement of any material fact contained in the
Memorandum or any amendment thereto or any Application or (ii) the omission or
the alleged omission to state therein a material fact required to be stated in
the Memorandum or any amendment thereto, or necessary to make the statements
therein not misleading, in each case to the extent, but only to the extent,
that such untrue statement or alleged untrue statement or omission or alleged
omission was made in reliance upon and in conformity with written information
furnished to any of the Issuers by or on behalf of such Initial Purchaser
specifically for use therein; and, subject to the limitation set forth
immediately preceding this clause, will reimburse, as incurred, any reasonable
and documented out-of-pocket legal or other expenses reasonably incurred by any
of the Issuers or any such director, officer or controlling person in
connection with investigating or defending against or appearing as a
third-party witness in connection with any such loss, claim, damage, liability
or action in respect thereof. This indemnity agreement will be in addition to
any liability that the Initial Purchasers may oth-
21
-21-
erwise have to the indemnified parties. The Initial Purchasers will not,
without the prior written consent of the Issuers, which shall not be
unreasonably withheld or delayed, settle or compromise or consent to the entry
of any judgment in any pending or threatened claim, action, suit or proceeding
in respect of which indemnification by any of the Issuers may be sought
hereunder (whether or not any of the Issuers or any person who controls the
Issuers within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act is a party to such claim, action, suit or proceeding), unless such
settlement, compromise or consent includes an unconditional release or any
other release reasonably acceptable to the Issuers) of any such Issuer and each
such controlling person from all liability arising out of such claim, action,
suit or proceeding.
(c) Promptly after receipt by an indemnified party under this Section 9
of notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against the indemnifying party under
this Section 9, notify the indemnifying party of the commencement thereof; but
the omission so to notify the indemnifying party will not relieve it from any
liability that it may have to any indemnified party except to the extent that
such omission results in the forfeiture by the indemnifying party of
substantial rights and defenses. In case any such action is brought against
any indemnified party, and such indemnified party notifies the indemnifying
party of the commencement thereof, the indemnifying party will be entitled to
participate therein and, to the extent that it may wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof, with
counsel reasonably satisfactory to such indemnified party; provided, however,
that if the defendants in any such action include both the indemnified party
and the indemnifying party and the indemnified party shall have reasonably
concluded, based on the advice of counsel, that there may be one or more legal
defenses available to it and/or other indemnified parties that are different
from or additional to those available to any such indemnifying party then the
indemnifying parties shall not have the right to direct the defense of such
action on behalf of such indemnified party or parties and such indemnified
party or parties shall have the right to select separate counsel to defend such
action on behalf of such indemnified party or parties. After notice from the
indemnifying party to such indemnified party of its election so to assume the
defense thereof and approval by such indemnified party of counsel appointed to
defend such action, the indemnifying party will not be liable to such
indemnified party under this Section 9 for any legal or other expenses, other
than reasonable and documented
22
-22-
out-of-pocket costs of investigation, subsequently incurred by such indemnified
party in connection with the defense thereof, unless (i) the indemnified party
shall have employed separate counsel in accordance with the proviso to the
immediately preceding sentence (it being understood, however, that in
connection with such action the indemnifying party shall not be liable for the
expenses of more than one separate counsel (in addition to local counsel) in
any one action or separate but substantially similar actions in the same
jurisdiction arising out of the same general allegations or circumstances,
designated by the Initial Purchasers in the case of paragraph (a) of this
Section 9 or the Issuers in the case of paragraph (b) of this Section 9,
representing the indemnified parties under such paragraph (a) or paragraph (b),
as the case may be, who are parties to such action or actions); (ii) the
indemnifying party has authorized in writing the employment of counsel for the
indemnified party at the expense of the indemnifying parties; or (iii) the
indemnifying party shall have failed to assume the defense or retain counsel
reasonably satisfactory to the indemnified party.
(d) In circumstances in which the indemnity agreement provided for in the
preceding paragraphs of this Section 9 is unavailable or insufficient to hold
harmless an indemnified party in respect of any losses, claims, damages or
liabilities (or actions in respect thereof), other than as a result of the
proviso to Section 9(a), each indemnifying party, in order to provide for just
and equitable contribution, shall contribute to the amount paid or payable by
such indemnified party as a result of such losses, claims, damages or
liabilities (or actions in respect thereof) in such proportion as is
appropriate to reflect (i) the relative benefits received by the indemnifying
party or parties on the one hand and the indemnified party on the other from
the offering of the Securities or (ii) if the allocation provided by the
foregoing clause (i) is not permitted by applicable law, not only such relative
benefits but also the relative fault of the indemnifying party or parties on
the one hand and the indemnified party on the other in connection with the
statements or omissions or alleged statements or omissions that resulted in
such losses, claims, damages or liabilities (or actions in respect thereof).
The relative benefits received by the Issuers on the one hand and the Initial
Purchasers on the other shall be deemed to be in the same proportion as the
total proceeds from the offering of the Securities (before deducting expenses
other than Initial Purchasers' discounts and commissions) received by the
Issuers bear to the total initial purchasers' discounts and commissions
received by the Initial Purchasers. The relative fault of the parties
23
-23-
shall be determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged omission
to state a material fact relates to information supplied by the Issuers on the
one hand or the Initial Purchasers on the other, the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission, and any other equitable considerations appropriate in
the circumstances. The Issuers and the Initial Purchasers agree that it would
not be equitable if the amount of such contribution were determined by pro rata
or per capita allocation (even if the Issuers on the one hand and the Initial
Purchasers on the other hand were treated as one entity for such purpose) or by
any other method of allocation that does not take into account the equitable
considerations referred to in the first sentence of this paragraph (d).
Notwithstanding any other provision of this paragraph (d), the Initial
Purchasers shall not be obligated to make contributions hereunder that in the
aggregate exceed the total initial purchasers' discounts and commissions
received by the Initial Purchasers under this Agreement, less the aggregate
amount of any damages that the Initial Purchasers have otherwise been required
to pay by reason of the untrue or alleged untrue statements or the omissions or
alleged omissions to state a material fact, and no person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. For purposes of this paragraph (d), each person, if any,
who controls any of the Initial Purchasers within the meaning of Section 15 of
the Act or Section 20 of the Exchange Act shall have the same rights to
contribution as the Initial Purchasers, and each director of any of the
Issuers, each officer and each person, if any, who controls any of the Issuers
within the meaning of Section 15 of the Act or Section 20 of the Exchange Act
shall have the same rights to contribution as the Issuers.
(e) Notwithstanding anything to the contrary in this Article 9, the
indemnification and contribution provisions of the Registration Rights
Agreement shall govern any claim with respect thereto.
10. Survival Clause. The respective representations, warranties,
agreements, covenants, indemnities and other statements of the Issuers, their
respective officers and the Initial Purchasers set forth in this Agreement or
made by or on behalf of them, respectively, pursuant to this Agreement shall
remain in full force and effect, regardless of (i) any investigation made by or
on behalf of the Issuers, any of their re-
24
-24-
spective officers or directors, the Initial Purchasers or any controlling
person referred to in Section 9 hereof and (ii) delivery of and payment for the
Securities, and shall be binding upon and shall inure to the benefit of, any
successors, assigns, heirs, personal representatives of the Issuers, the
Initial Purchasers and indemnified parties referred to in Section 9 hereof.
The respective agreements, covenants, indemnities and other statements set
forth in Sections 7 and 9 hereof shall remain in full force and effect,
regardless of any termination or cancellation of this Agreement.
11. Termination. (a) This Agreement may be terminated in the sole
discretion of the Initial Purchasers by notice to the Issuers given in the
event that the Issuers shall have failed, refused or been unable to satisfy all
conditions on its respective part to be performed or satisfied hereunder on or
prior to the Closing Date or, if at or prior to the Closing Date:
(i) any of the Issuers or the Subsidiaries shall have sustained any
loss or interference with respect to their respective businesses or
properties from fire, flood, hurricane, earthquake, accident or other
calamity, whether or not covered by insurance, or from any labor dispute
or any legal or governmental proceeding, which loss or interference has
had or has a material adverse effect on the business, condition
(financial or other), properties, prospects or results of operations of
the Issuers and the Subsidiaries taken as a whole, or there shall have
been any material adverse change, or any development involving a
prospective material adverse change (including without limitation a
change in management or control of the Issuers), in the business,
condition (financial or other), properties, prospects or results of
operations of the Issuers and the Subsidiaries except as described in or
contemplated by the Memorandum (exclusive of any amendment or supplement
thereto);
(ii) trading in securities generally on the New York or American
Stock Exchange shall have been suspended or minimum or maximum prices
shall have been established on any such exchange;
(iii) a banking moratorium shall have been declared by New York or
United States authorities; or
(iv) there shall have been (A) an outbreak or escalation of
hostilities between the United States and any for-
25
-25-
eign power, (B) an outbreak or escalation of any other insurrection or
armed conflict involving the United States or (C) any material change in
the financial markets of the United States that, in the sole judgment of
the Initial Purchasers, makes it impracticable or inadvisable to proceed
with the offering or the delivery of the Securities as contemplated by
the Memorandum, as amended as of the date hereof.
(b) Termination of this Agreement pursuant to this Section 11 shall
be without liability of any party to any other party except as provided in
Section 10 hereof.
12. Notices. All communications hereunder shall be in writing and,
if sent to the Initial Purchasers, shall be mailed or delivered or telecopied
and confirmed in writing to the Initial Purchasers c/o CIBC Wood Gundy
Securities Corp., ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇,
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, and with a copy to ▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇,
▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇, Esq. If
sent to the Company or any of the Subsidiary Guarantors, shall be mailed,
delivered or telegraphed and confirmed in writing, to ▇▇▇▇▇ Wheels
International, Inc., ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
Attention: General Counsel and with a copy to Skadden, Arps, Slate, ▇▇▇▇▇▇▇ &
▇▇▇▇ LLP, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇, Esq.
13. Successors. This Agreement shall inure to the benefit of and be
binding upon the Initial Purchasers and each of the Issuers and their
respective successors and legal representatives, and nothing expressed or
mentioned in this Agreement is intended or shall be construed to give any other
person any legal or equitable right, remedy or claim under or in respect of
this Agreement, or any provisions herein contained; this Agreement and all
conditions and provisions hereof being intended to be and being for the sole
and exclusive benefit of such persons and for the benefit of no other person
except that (i) the indemnities of the Issuers contained in Section 9 of this
Agreement shall also be for the benefit of any person or persons who control
the Initial Purchasers within the meaning of Section 15 of the Act or Section
20 of the Exchange Act and (ii) the indemnities of the Initial Purchasers
contained in Section 9 of this Agreement shall also be for the benefit of the
directors of the Issuers, their respective officers and any person or persons
who controls any Issuer within the meaning of Section 15 of the Act or Section
20 of the Exchange Act. No
26
-26-
purchaser of Securities from the Initial Purchasers will be deemed a successor
because of such purchase.
14. Joint and Several Obligations. All of the obligations of the
Issuers hereunder shall be joint and several obligations of each of them.
15. Information Supplied by the Initial Purchasers. The statements
set forth in the first legend on the inside front cover of the Memorandum and in
the penultimate and last sentence of the third paragraph and the seventh
paragraph under the heading "Plan of Distribution" constitute the only
information furnished by the Initial Purchasers to the Issuers for purposes of
Section 2(a) hereof.
16. Entire Agreement. This Agreement constitutes the entire
agreement among the parties hereto and supersedes all prior agreements,
understandings and arrangements, oral or written, among the parties hereto with
respect to the subject matter hereof.
17. APPLICABLE LAW. THE VALIDITY AND INTERPRETATION OF THIS
AGREEMENT, AND THE TERMS AND CONDITIONS SET FORTH HEREIN SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT
GIVING EFFECT TO ANY PROVISIONS RELATING TO CONFLICTS OF LAW.
18. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
27
-27-
If the foregoing correctly sets forth our understanding, please
indicate your acceptance thereof in the space provided below for that purpose,
whereupon this letter shall constitute a binding agreement among the Issuers
and the Initial Purchasers.
Very truly yours,
▇▇▇▇▇ WHEELS INTERNATIONAL, INC.,
a Delaware corporation
By:
----------------------------------------
Name:
Title:
▇▇▇▇▇ WHEELS INTERNATIONAL-CALIFORNIA,
INC., a Delaware corporation
By:
----------------------------------------
Name:
Title:
▇▇▇▇▇ WHEELS INTERNATIONAL-GEORGIA,
INC., a Delaware
corporation
By:
----------------------------------------
Name:
Title:
▇▇▇▇▇ WHEELS INTERNATIONAL-INDIANA,
INC., a Delaware corporation
By:
----------------------------------------
Name:
Title:
28
-28-
▇▇▇▇▇ WHEELS INTERNATIONAL-MEXICO, INC., a
Delaware corporation
By:
----------------------------------------
Name:
Title:
▇▇▇▇▇ WHEELS INTERNATIONAL-MICHIGAN,
INC., a Michigan corporation
By:
----------------------------------------
Name:
Title:
MOTOR WHEEL CORPORATION,
an Ohio corporation
By:
----------------------------------------
Name:
Title:
MWC ACQUISITION SUB, INC.,
a Delaware corporation
By:
----------------------------------------
Name:
Title:
29
-29-
The foregoing Agreement is hereby confirmed
and accepted as of the date first above
written.
CIBC WOOD GUNDY SECURITIES CORP.
By:
---------------------------------------
Name:
Title:
▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ &
▇▇▇▇▇ INCORPORATED
By:
---------------------------------------
Name:
Title:
30
Exhibit A
Subsidiary Guarantors
▇▇▇▇▇ Wheels International-California, Inc.
▇▇▇▇▇ Wheels International-Georgia, Inc.
▇▇▇▇▇ Wheels International-Indiana, Inc.
▇▇▇▇▇ Wheels International-Mexico, Inc.
▇▇▇▇▇ Wheels International-Michigan, Inc.
Motor Wheel Corporation
MWC Acquisition Sub, Inc.
31
Exhibit B
Company Subsidiaries
▇▇▇▇▇ (Europe), Ltd.
▇▇▇▇▇ Wheels, S.p.A.
▇▇▇▇▇ Wheels Autokola NH, as
Reliable Transportation Components Inc.
▇▇▇▇▇ Wheels International - Missouri, Inc.
▇▇▇▇▇ Wheels International - Kentuckulus, Inc.
▇▇▇▇▇ Wheels Aftermarket, Inc.
▇▇▇▇▇ Wheels Japan Limited
▇▇▇▇▇ Wheels de Espana, S.A.
HWI Service Corporation
▇▇▇▇▇ Wheels Foreign Sales Corp.
Motor Wheel de Mexico, S.A. de C.V.
Motor Wheel Corporation of Canada, Ltd.
AMW Holdings, Inc.
HL Holdings BV
HL Holdings de Espana
HL Holding GmbH
▇▇▇▇▇ Wheels Hungary Consulting Limited Liability Company
Newco No. 17 Vermogensverwaltungs GmbH (post-Acquisition)
Newco No. 18 Vermogensverwaltungs GmbH (post-Acquisition)
Lemmerz Holding GmbH
Metaalgieterij ▇▇▇▇▇▇ B.V.
Lemmerz Espanola ▇.▇.
▇▇▇▇▇▇▇-Werke GmbH
Lemmerz-Werke Wohnungsbaugesellschaft mbH
Lemmerz Service System N.V.
Lemmerz Belgie N.V.
Lemmerz Comerico e Participacoes SRL
Lemmerz Canada Inc.
PSW Prazisions-und Spezialwerkzeuge AG
Lemmerz-Inci-Jany Sanayi A.S.
Company Joint Venture and Other Interests
Numbers in parentheses represent percent of total owned by the Company or one
of its subsidiaries.
▇▇▇▇▇ Wheels de Venezuela, C.A. (49)
▇▇▇▇▇ Wheels de Mexico, S.A. de C.V. (40)
Aluminum Wheel Technology, Inc. (50)
Riviera Tool Company (30)
Metalurgica FPS do Brasil, Ltda. (49)
Continental Lemmerz (Portugal), Componentes para
Automoveis, Lda. (49)
32
-2-
Borlem S.A. Empreendimentos Industriais (45)
▇▇▇▇▇▇▇▇-▇▇▇▇▇▇▇ Industries (25)
Kalyani-Lemmerz Ltd. (25)
Jantas Jant Sanayi ve Ticaret S.A. (25)
Siam Lemmerz Co., Ltd. (25)
Additional Information
See Section 4.3(c), paragraph (ii), of the disclosure schedule provided by
Lemmerz pursuant to the acquisition agreement dated as of June 6, 1997 among
the Company, Cromodoro Wheels S.p.A., and the shareholders of Lemmerz (the
"Acquisition Agreement") regarding certain qualifying shares held by third
parties in certain Subsidiaries of Lemmerz.
33
Exhibit C
Principal Amount
Initial Purchaser of Securities
----------------- ----------------
CIBC Wood Gundy Securities Corp. $ 90,000,000
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇
& ▇▇▇▇▇ Incorporated 60,000,000
Total $150,000,000
============
34
Exhibit D-1
Form of Opinion of Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP
Opinion, dated the Closing Date and addressed to the Initial
Purchasers, of Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP, counsel to the Issuers,
to the effect that:
(i) The Securities have been duly authorized by each of the Issuers
other than ▇▇▇▇▇ Wheels International-Michigan, Inc. (the "Delaware
Issuers") and when executed by the Delaware Issuers and authenticated by
the Trustee in accordance with the provisions of the Indenture, and
delivered to and paid for by the Initial Purchasers in accordance with
the terms of the Purchase Agreement, will have been duly executed, issued
and delivered and will constitute valid and binding obligations of the
Delaware Issuers, entitled to the benefits of the Indenture and
enforceable against the Delaware Issuers in accordance with their terms,
except that the enforcement thereof may be subject to (a) bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium or other
similar laws now or hereafter in effect relating to creditors' rights
generally, and (b) general principles of equity (regardless of whether
enforceability is considered in a proceeding at law or in equity).
(ii) The Exchange Notes, the Private Exchange Notes and the
guarantees thereof have been duly and validly authorized by the Delaware
Issuers and when executed by the Delaware Issuers and authenticated by
the Trustee in accordance with the provisions of the Registration Rights
Agreement and the Indenture, and delivered to the Initial Purchasers in
accordance with the terms of the Registration Rights Agreement, will have
been duly executed, issued and delivered and will constitute valid and
binding obligations of the Delaware Issuers, entitled to the benefits of
the Indenture and enforceable against the Delaware Issuers in accordance
with their terms, except that the enforcement thereof may be subject to
(a) bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium or other similar laws now or hereafter in effect relating to
creditors' rights generally, and (b) general principles of equity
(regardless of whether enforceability is considered in a proceeding at
law or in equity).
35
-2-
(iii) Each of the Delaware Issuers has the requisite corporate power
and corporate authority to execute, deliver and perform its obligations
under the Indenture, the Securities, the Exchange Notes and the Private
Exchange Notes; the Indenture has been duly authorized by the Delaware
Issuers and, when executed and delivered by the Delaware Issuers
(assuming the due authorization, execution and delivery by the Trustee),
will constitute a valid and binding agreement of the Delaware Issuers,
enforceable against the Delaware Issuers in accordance with its terms,
except that the enforcement thereof may be subject to (a) bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium or other
similar laws now or hereafter in effect relating to creditors' rights
generally and (b) general principles of equity (regardless of whether
enforceability is considered in a proceeding at law or in equity).
(iv) Each of the Delaware Issuers has the requisite corporate power
and authority to execute, deliver and perform its obligations under the
Registration Rights Agreement. The Registration Rights Agreement has
been duly authorized by the Delaware Issuers and, when executed and
delivered by the Delaware Issuers, will constitute a valid and binding
agreement of the Delaware Issuers, enforceable against the Delaware
Issuers in accordance with its terms except (i) that the enforcement
thereof may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws now or hereafter in effect relating to
creditors' rights generally or general principles of equity (regardless
of whether such enforcement is considered in a proceeding at law or in
equity) and (ii) as any rights to indemnity or contribution hereunder may
be limited by federal and state securities laws and public policy
considerations.
(v) Each of the Delaware Issuers has the requisite corporate power
and authority to execute, deliver and perform its obligations under the
Purchase Agreement. The Purchase Agreement has been duly authorized by
the Delaware Issuers and, when executed and delivered by the Delaware
Issuers, will constitute a valid and binding agreement of the Delaware
Issuers, enforceable against the Delaware Issuers in accordance with its
terms except (i) that the enforcement thereof may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar laws
now or hereafter in effect relating to creditors' rights generally or
general principles of equity
36
-3-
(regardless of whether such enforcement is considered in a proceeding at
law or in equity) and (ii) as any rights to indemnity or contribution
hereunder may be limited by federal and state securities laws and public
policy considerations.
(vi) No Governmental Approval is required for the performance by the
Delaware Issuers of their respective obligations under the Offering
Documents or the consummation of the transactions contemplated thereby
relating to the Securities.
As used in such counsel's opinion, (a) the term "Applicable Laws"
means only the General Corporation Law of the State of Delaware and those
laws, rules and regulations of the State of New York and the United
States of America which, in our experience, are normally applicable to
transactions of the type contemplated by the Purchase Agreement (other
than federal and state securities laws, the TIA and the rules and
regulations of the National Association of Securities Dealers, Inc.)
without having made any special investigation as to the applicability of
any specific law, rule or regulation except as specified herein; (b) the
term "Governmental Authorities" means any Delaware, New York or federal
executive, legislative, judicial, administrative or regulatory body; and
(c) the term "Governmental Approval" means any consent, approval,
license, authorization or validation of, or filing, qualification or
registration with, any Governmental Authority pursuant to Applicable
Laws.
(vii) The execution, delivery and performance by the Delaware
Issuers of each of the Offering Documents and the consummation by the
Delaware Issuers of the transactions contemplated thereby and the
fulfillment of the terms thereof, will not violate or conflict with the
certificate of incorporation or bylaws of any of the Delaware Issuers.
(viii) The Amendment has been duly authorized by each of the
Delaware Issuers, which is a party thereto.
(ix) The statements set forth in the Memorandum under the captions
"Description of the Notes" and "Description of Other Indebtedness,"
insofar as such statements constitute a summary of the terms of the
documents referred to therein, fairly summarize such terms in all
material respects.
37
-4-
(x) None of the Issuers or the Subsidiaries is required to register
as an "investment company" or a company "controlled by" an "investment
company" as such terms are defined in the Investment Company Act of 1940,
as amended.
(xi) Neither the consummation of the transactions contemplated by
the Purchase Agreement nor the sale, issuance, execution or delivery of
the Securities will violate Regulation G, T, U or X of the Board of
Governors of the Federal Reserve System.
(xii) The Indenture appears on its face to be appropriately
responsive in all material respects to the requirements of the TIA.
(xiii) Assuming (i) the accuracy of the representations and
warranties of the Company set forth in Section 2 of the Purchase
Agreement and of you in Section 5 of the Purchase Agreement, (ii) the due
performance by the Company of the covenants and agreements set forth in
Section 6 of the Purchase Agreement and the due performance by you of the
covenants and agreements set forth in Sections 5 and 6 of the Purchase
Agreement, (iii) your compliance with the offering and transfer
procedures and restrictions described in the Memorandum, (iv) the
accuracy of the representations and warranties made in accordance with
the Purchase Agreement and the Memorandum by purchasers to whom you
initially resell Securities and (v) that purchasers to whom you initially
resell Securities receive a copy of the Memorandum prior to such sale,
the offer, sale and delivery of the Securities to you in the manner
contemplated by the Purchase Agreement and the Memorandum and the initial
resale of the Securities by you in the manner contemplated in the
Memorandum and the Purchase Agreement, do not require registration under
the Act and the Indenture does not require qualification under the TIA,
it being understood that we express no opinion as to any subsequent
resale of any Security.
In addition, we have participated in conferences with officers and
other representatives of the Issuers, representatives of the independent public
accountants and representatives of the Initial Purchasers at which the contents
of the Memorandum were discussed and, although we are not passing upon and do
not assume any responsibility for the accuracy, completeness or fairness of the
statements contained in the Memorandum (except as indicated in clause (ix)
above) and have not made any independent check or verification thereof, on the
basis of the
38
-5-
foregoing (relying as to materiality to a large extent upon the statements of
officers and other representatives of each of the Issuers) no facts have come
to our attention that have caused us to believe that the Memorandum as of its
date and as of the Closing Date contained or contains an untrue statement of a
material fact or omitted or omits to state a material fact necessary in order
to make the statements therein, in the light of the circumstances under which
they were made, not misleading (it being understood that we express no opinion
on or belief with respect to the financial statements or other financial and
statistical data or information included in the Memorandum or on the
information contained in the Memorandum concerning Lemmerz and the subsidiaries
of Lemmerz).
39
Exhibit D-2
Form of Opinion of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.
Opinion, dated the Closing Date and addressed to the Initial
Purchasers, of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq., General Counsel to the Company, to
the effect that:
(i) Each of the Issuers has been duly incorporated and is validly
existing in good standing, as a corporation under the laws of its
jurisdiction of incorporation, with the requisite corporate power and
authority to own its properties and conduct its business as described in
the Memorandum and is duly qualified to do business as a foreign
corporation in good standing in all other jurisdictions where the
ownership or leasing of its properties or the conduct of its business
requires such qualification, except when the failure to be so qualified
would not, individually or in the aggregate, have a Material Adverse
Effect; the outstanding shares of capital stock of the Issuers and the
Subsidiaries have been duly authorized and validly issued, are fully paid
and nonassessable and were not issued in violation of any preemptive or
similar rights and, in the case of the Subsidiary Guarantors and the
Subsidiaries, except in connection with the Amended Credit Agreement, are
owned free and clear of all liens, encumbrances, equities and
restrictions on transferability (other than those imposed by the Act and
the state securities or "Blue Sky" laws); to the best of my knowledge,
except as set forth in the Memorandum, no options, warrants or other
rights to purchase from any Issuer or any Subsidiary or, agreements or
other obligations of any Issuer or any Subsidiary to issue or other
rights to cause the Company, to convert any obligation into, or exchange
any securities for, shares of capital stock or ownership interests in any
Issuer or any Subsidiary are outstanding.
(ii) The Guarantee has been duly and validly authorized by ▇▇▇▇▇
Wheels International-Michigan, Inc. ("HWIM") and Motor Wheel Corporation
("MWC") and when the Securities are executed by the Company and
authenticated by the Trustee in accordance with the provisions of the
Indenture, and delivered to and paid for by the Initial Purchasers in
accordance with the terms of the Purchase Agreement, will have been duly
executed, issued and delivered and will constitute valid and legally
binding obliga-
40
-2-
tion of HWIM and MWC, enforceable against HWIM and MWC in accordance with
its terms, except that the enforcement thereof may be subject to (a)
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium
or other similar laws now or hereafter in effect relating to creditors'
rights generally, and (b) general principles of equity (regardless of
whether enforceability is considered in a proceeding at law or in
equity).
(iii) The guarantee of the Exchange Notes and the Private Exchange
Notes have been duly and validly authorized by HWIM and MWC and when the
Exchange Notes and the Private Exchange Notes have been executed by the
Company and authenticated by the Trustee in accordance with the
provisions of the Registration Rights Agreement and the Indenture, and
delivered to the Initial Purchasers in accordance with the terms of the
Registration Rights Agreement, will have been duly executed, issued and
delivered and will constitute a valid and legally binding obligation of
HWIM and MWC, enforceable against HWIM and MWC in accordance with its
terms, except that the enforcement thereof may be subject to (a)
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium
or other similar laws now or hereafter in effect relating to creditors'
rights generally, and (b) general principles of equity (regardless of
whether enforceability is considered in a proceeding at law or in
equity).
(iv) Each of HWIM and MWC has the requisite corporate power and
corporate authority to execute, deliver and perform its obligations under
the Indenture, the Securities, the Exchange Notes and the Private
Exchange Notes; the Indenture has been duly and validly authorized by
HWIM and MWC and, when executed and delivered by HWIM and MWC (assuming
the due authorization, execution and delivery by the Trustee), will
constitute a valid and legally binding agreement of HWIM and MWC,
enforceable against HWIM and MWC in accordance with its terms, except
that the enforcement thereof may be subject to (a) bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium or other
similar laws now or hereafter in effect relating to creditors' rights
generally and (b) general principles of equity (regardless of whether
enforceability is considered in a proceeding at law or in equity.
(v) Each of HWIM and MWC has the requisite corporate power and
authority to execute, deliver and perform its obligations under the
Registration Rights Agreement. The
41
-3-
Registration Rights Agreement has been duly and validly authorized by
HWIM and MWC and, when executed and delivered by HWIM and MWC, will
constitute a valid and legally binding agreement of HWIM and MWC,
enforceable against HWIM and MWC in accordance with its terms except (i)
that the enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in
effect relating to or affecting creditors' rights generally or general
principles of equity (regardless of whether such enforcement is
considered in a proceeding at law or in equity) and (ii) as any rights
to indemnity or contribution hereunder may be limited by federal and
state securities laws and public policy considerations.
(vi) Each of HWIM and MWC has the requisite corporate power and
authority to execute, deliver and perform its obligations under the
Purchase Agreement. The Purchase Agreement has been duly and validly
authorized by HWIM and MWC and, when executed and delivered by HWIM and
MWC, will constitute a valid and legally binding agreement of HWIM and
MWC, enforceable against HWIM and MWC in accordance with its terms except
(i) that the enforcement thereof may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws now or
hereafter in effect relating to or affecting creditors' rights generally
or general principles of equity (regardless of whether such enforcement
is considered in a proceeding at law or in equity) and (ii) as any
rights to indemnity or contribution hereunder may be limited by federal
and state securities laws and public policy considerations.
(vii) No consent, approval, authorization or order of any
governmental agency or body, or to the best of my knowledge, any court,
is required for the performance of any of the Offering Documents or any
of the agreements contemplated thereby or delivered in connection
therewith, or the consummation of the transactions contemplated thereby,
except such as may be required and have been obtained as described in the
Memorandum or as may be required under the Act, the TIA or state
securities or "Blue Sky" laws in connection with the purchase and
distribution of the Securities or the exchange of the Exchange Notes and
the Private Exchange Notes.
(viii) None of the Issuers or the Subsidiaries is (a) in violation
of its certificate of incorporation or bylaws, (b) in violation of any
statute, judgment, decree,
42
-4-
order, rule or regulation applicable to any of its properties or assets,
which violation would, individually or in the aggregate, have a Material
Adverse Effect or (c) in breach of or in default under any of the
Offering Documents or any material contract, indenture, mortgage, deed of
trust, loan agreement, note, lease, license, franchise agreement, permit,
certificate or other material agreement or instrument to which it is a
party or to which it is subject, which breach or default would
individually or in the aggregate, have a Material Adverse Effect.
(ix) The execution, delivery and performance by the Issuers, to the
extent each is a party thereto, of each of the Offering Documents and the
Amended Credit Agreement and the consummation by the Issuers of the
transactions contemplated thereby and the fulfillment of the terms
thereof, will not violate, conflict with or constitute or result in a
breach of or a default under (or an event that with notice or lapse of
time, or both, would constitute a breach of or a default under) any of
the terms or provisions of (a) the certificate of incorporation or bylaws
of HWIM, (b) any material indenture, mortgage, deed of trust, loan
agreement, note, lease, license, franchise agreement or other material
agreement or instrument to which any of the Issuers or the Subsidiaries
is a party or to which any of their respective properties or assets are
subject or (c) to the best of my knowledge (assuming compliance with all
applicable Federal and state securities and "Blue Sky" laws) any statute,
judgment, decree, order, rule or regulation of any court or governmental
agency or body applicable to any of the Issuers or the Subsidiaries or
any of their respective properties or assets, which violation, conflict,
breach or default would, individually or in the aggregate, have any
Material Adverse Effect.
(x) Except as described in the Memorandum, there are no legal or
governmental proceedings pending or threatened to which any of the
Issuers or the Subsidiaries is a party or to which the respective
properties or assets of the Issuers or the Subsidiaries are subject that
would be required to be described in a prospectus pursuant to the Act
that are not described in the Memorandum, or that seek to restrain,
enjoin, prevent the consummation of or otherwise challenge the issuance
or sale of the Securities to the Initial Purchasers or the consummation
of the transactions described in the Memorandum under the captions "Use
of Proceeds".
43
-5-
(xi) The Amendment has been duly authorized by HWIM to the extent it
is or will be a party thereto.
I have participated in conferences with officers and other
representatives of the Company, representatives of the independent public
accountants for the Company, outside counsel for the Company, your counsel and
your representatives at which the contents of the Memorandum and related
matters were discussed and, although I am not passing upon and do not assume
any responsibility for the accuracy, completeness or fairness of the statements
contained in the Memorandum, I advise you that, on the basis of the foregoing
[(relying, with respect to Lemmerz, primarily upon (i) the representations and
warranties of Lemmerz and the shareholders of Lemmerz contained in the
Acquisition Agreement and (ii) the due diligence reports prepared by counsel
and other representatives of the Company retained in connection with the
Company's acquisition of Lemmerz (copies of which have been provided to your
counsel in connection with their due diligence review of the Company);
provided, however, that I have not independently investigated or verified, nor
do I assume any responsibility for, the information contained in such
reports)], no facts have come to my attention that lead me to believe that the
Memorandum as of its date and as of the Closing Date contained or contains an
untrue statement of a material fact or omitted or omits to state a material
fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading (it being understood
that I have not been requested to and do not make any comment with respect to
the financial statements and the notes thereto and other financial and
accounting information included or incorporated by reference in the
Memorandum).
