EXHIBIT 1.2
________________________________________________________________________________
________________________________________________________________________________
FEDERAL-MOGUL CORPORATION
(a Michigan corporation)
____________ Shares of Common Stock
U.S. PURCHASE AGREEMENT
Dated: June ., 1998
________________________________________________________________________________
________________________________________________________________________________
TABLE OF CONTENTS
PAGE
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U.S. PURCHASE AGREEMENT.............................................................................. 1
SECTION 1. Representations and Warranties...................................................... 4
(a) Representations and Warranties by the Company....................................... 4
(i) Compliance with Registration Requirements....................................... 4
(ii) Incorporated Documents......................................................... 5
(iii) Independent Accountants....................................................... 5
(iv) Financial Statements........................................................... 5
(v) No Material Adverse Change in Business.......................................... 6
(vi) Good Standing of the Company................................................... 6
(vii) Good Standing of Subsidiaries................................................. 6
(viii) Capitalization............................................................... 7
(ix) Authorization of Agreement..................................................... 7
(x) Authorization and Description of Securities..................................... 7
(xi) Absence of Defaults and Conflicts.............................................. 7
(xii) Absence of Labor Dispute...................................................... 8
(xiii) Absence of Proceedings....................................................... 8
(xiv) Accuracy of Exhibits.......................................................... 9
(xv) Possession of Intellectual Property............................................ 9
(xvi) Absence of Further Requirements............................................... 9
(xvii) Possession of Licenses and Permits........................................... 9
(xviii) Title to Property........................................................... 10
(xix) [Intentionally omitted]....................................................... 10
(xx) Investment Company Act......................................................... 10
(xxi) Environmental Laws............................................................ 10
(b) Representations and Warranties by the Selling Shareholders and Covenants
of the Selling Shareholders......................................................... 11
(i) Accurate Disclosure............................................................. 11
(ii) Authorization of Agreements.................................................... 11
(iii) Good and Marketable Title..................................................... 12
(iv) Due Execution of Power of Attorney and Custody Agreement....................... 12
(v) Absence of Manipulation......................................................... 13
(vi) Absence of Further Requirements................................................ 13
(vii) Restriction on Sale of Securities............................................. 13
(viii) Certificates Suitable for Transfer........................................... 13
(ix) No Association with NASD....................................................... 14
(c) Officer's Certificates.............................................................. 14
(d) Selling Shareholder's Certificates.................................................. 14
SECTION 2. Sale and Delivery to U.S. Underwriters; Closing..................................... 14
(a) Initial Securities.................................................................. 14
(b) Option Securities................................................................... 14
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(c) Payment............................................................................. 15
(d) Denominations; Registration......................................................... 16
SECTION 3. Covenants of the Company............................................................ 16
(a) Compliance with Securities Regulations and Commission Requests...................... 16
(b) Filing of Amendments................................................................ 16
(c) Delivery of Registration Statements................................................. 17
(d) Delivery of Prospectuses............................................................ 17
(e) Continued Compliance with Securities Laws........................................... 17
(f) Blue Sky Qualifications............................................................. 17
(g) Earnings Statement.................................................................. 18
(h) Use of Proceeds..................................................................... 18
(i) Listing............................................................................. 18
(j) Restriction on Sale of Securities................................................... 18
(k) Reporting Requirements.............................................................. 18
SECTION 4. Payment of Expenses. ............................................................... 19
(a) Expenses............................................................................ 19
(b) Termination of Agreement............................................................ 19
SECTION 5. Conditions of U.S. Underwriters' Obligations........................................ 19
(a) Effectiveness of Registration Statement............................................. 19
(b) Opinion of Counsel for Company...................................................... 20
(c) Opinion of Counsel for the Selling Shareholders..................................... 20
(d) Opinion of Counsel for U.S. Underwriters............................................ 20
(e) Officers' Certificate............................................................... 20
(f) Certificate of Selling Shareholders................................................. 21
(g) Accountant's Comfort Letter......................................................... 21
(h) Bring-down Comfort Letter........................................................... 21
(i) Approval of Listing................................................................. 21
(j) Lock-up Agreements.................................................................. 21
(k) Purchase of Initial International Securities........................................ 21
(l) Conditions to Purchase of U.S. Option Securities.................................... 21
(i) Officers' Certificate...................................................... 22
(ii) Certificate of Selling Shareholders........................................ 22
(iii) Opinion of Counsel for the Company......................................... 22
(iv) Opinion of Counsel for the Selling Shareholders............................ 22
(m) Additional Documents................................................................ 23
(n) Termination of Agreement............................................................ 23
SECTION 6. Indemnification..................................................................... 23
(a) Indemnification of U.S. Underwriters............................................... 23
(b) Indemnification of Company, Directors and Officers.................................. 24
(c) Actions against Parties; Notification............................................... 25
(d) Settlement without Consent if Failure to Reimburse.................................. 25
(e) Limitation on Selling Shareholders' Indemnification................................. 25
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SECTION 7. Contribution.......................................................................... 26
SECTION 8. Representations, Warranties and Agreements to Survive Delivery........................ 27
SECTION 9. Termination of Agreement.............................................................. 27
(a) Termination; General.................................................................. 27
(b) Liabilities........................................................................... 28
SECTION 10. Default by One or More of the U.S. Underwriters....................................... 28
SECTION 11. Default by One or More of the Selling Shareholder(s) or the Company................... 29
SECTION 12. Notices............................................................................... 29
SECTION 13. Parties............................................................................... 29
SECTION 14. Governing Law and Time................................................................ 30
SECTION 15. Effect of Headings.................................................................... 30
SCHEDULES
Schedule A-1 - List of Underwriters...................................................... Sch A-1
Schedule A-2 - Initial U.S. Securities and U.S. Option Securities........................ Sch A-2
Schedule B - Pricing Information....................................................... Sch B-1
Schedule C - List of Subsidiaries...................................................... Sch C-1
Schedule D - List of persons and entities subject to Lock-up........................... Sch D-1
EXHIBITS
Exhibit A - Form of Opinion of Company's Counsel................................................ A-1
Exhibit A-2 - Form of Opinion of Selling Shareholders' Counsel.................................. A-2
Exhibit B - Form of Lock-up Letter.............................................................. B-1
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Draft of June 1, 1998
FEDERAL-MOGUL CORPORATION
(a Michigan corporation)
____________ Shares of Common Stock
(Without Par Value)
U.S. PURCHASE AGREEMENT
------------------------
June ., 1998
▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO.
▇▇▇▇▇▇▇ Lynch, ▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
Bear, ▇▇▇▇▇▇▇ & Co. Inc.
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
Securities Corporation
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co., Inc.
▇▇▇▇▇ ▇▇▇▇▇▇ Inc.
▇▇▇▇▇▇▇▇ & Co. Inc.
as U.S. Representatives of the several U.S. Underwriters
c/▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co.
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
North Tower
World Financial Center
New York, New York 10281-1209
Ladies and Gentlemen:
Federal-Mogul Corporation, a Michigan corporation (the "Company"), and the
shareholders listed on Schedule A-2 hereto (the "Selling Shareholders"), confirm
their respective agreements with ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., ▇▇▇▇▇▇▇ Lynch, ▇▇▇▇▇▇,
▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated ("▇▇▇▇▇▇▇ ▇▇▇▇▇") and each of the other U.S.
Underwriters named in Schedule A hereto (collectively, the "U.S. Underwriters",
which term shall also include any underwriter substituted as hereinafter
provided in Section 10 hereof), for whom ▇▇▇▇▇▇▇ ▇▇▇▇▇, Bear, ▇▇▇▇▇▇▇ & Co.
Inc., ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ Securities Corporation, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co.,
Inc., ▇▇▇▇▇ ▇▇▇▇▇▇ Inc. and ▇▇▇▇▇▇▇▇ & Co. Inc. are acting as representatives
(in such capacity, the "U.S. Representatives"), with respect to (i) the sale by
the Company and the Selling Shareholders, acting severally and not jointly, and
the purchase by the U.S. Underwriters, acting severally and not jointly, of the
respective numbers of shares of Common Stock,
without par value, of the Company ("Common Stock") as set forth in said
Schedules A and A-1 (which, with respect to the Selling Shareholders, reflect
shares of Common Stock to be issued upon conversion of shares of Series E
Mandatory Exchangeable Preferred Stock ("Series E Stock")), and (ii) the grant
by the Company and the Selling Shareholders to the U.S. Underwriters, acting
severally and not jointly, of the option described in Section 2(b) hereof to
purchase all or any part of ____________ additional shares of Common Stock to
cover over-allotments, if any. The aforesaid ____________ shares of Common
Stock (the "Initial U.S. Securities") to be purchased by the U.S. Underwriters
and all or any part of the ____________ shares of Common Stock subject to the
option described in Section 2(b) hereof (the "U.S. Option Securities") are
hereinafter called, collectively, the "U.S. Securities".
It is understood that the Company and the Selling Shareholders are
concurrently entering into an agreement dated the date hereof (the
"International Purchase Agreement") providing for the offering by the Company
and the Selling Shareholders of an aggregate of ____________ shares of Common
Stock (the "Initial International Securities") through arrangements with certain
underwriters outside the United States and Canada (the "International Managers")
for which ▇▇▇▇▇▇▇ ▇▇▇▇▇ International, Bear, ▇▇▇▇▇▇▇ International Limited,
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. International Limited, ▇▇▇▇▇ ▇▇▇▇▇▇ Inc., ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇
& ▇▇▇▇▇▇▇▇ International, ▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & Co. Limited, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇,
Credit Lyonnais Securities and Kleinwort ▇▇▇▇▇▇ Limited are acting as lead
managers) (the "Lead Managers") and the grant by the Company and the Selling
Shareholders to the International Managers, acting severally and not jointly, of
an option to purchase all or any part of the International Managers' pro rata
portion of up to ____________ additional shares of Common Stock solely to cover
overallotments, if any (the "International Option Securities" and, together with
the U.S. Option Securities, the "Option Securities"). The Initial International
Securities and the International Option Securities are hereinafter called the
"International Securities". It is understood that the Company and the Selling
Shareholders are not obligated to sell and the U.S. Underwriters are not
obligated to purchase, any Initial U.S. Securities unless all of the Initial
International Securities are contemporaneously purchased by the International
Managers.
The U.S. Underwriters and the International Managers are hereinafter
collectively called the "Underwriters", the Initial U.S. Securities and the
Initial International Securities are hereinafter collectively called the
"Initial Securities", and the U.S. Securities, and the International Securities
are hereinafter collectively called the "Securities".
The Underwriters will concurrently enter into an Intersyndicate Agreement
of even date herewith (the "Intersyndicate Agreement") providing for the
coordination of certain transactions among the Underwriters under the direction
of ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., ▇▇▇▇▇▇▇ Lynch, ▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated (in
such capacity, the "Global Coordinator").
The Company and the Selling Shareholders understand that the U.S.
Underwriters propose to make a public offering of the U.S. Securities as soon as
the U.S. Representatives deem advisable after this Agreement has been executed
and delivered.
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The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (No. 333-50413) and pre-
effective amendment nos. 1 and 2 thereto covering the registration of the
Securities under the Securities Act of 1933, as amended (the "1933 Act"),
including the related preliminary prospectus or prospectuses. Promptly after
execution and delivery of this Agreement, the Company will either (i) prepare
and file a prospectus in accordance with the provisions of Rule 430A ("Rule
430A") of the rules and regulations of the Commission under the 1933 Act (the
"1933 Act Regulations") and paragraph (b) of Rule 424 ("Rule 424(b)") of the
1933 Act Regulations or (ii) if the Company has elected to rely upon Rule 434
("Rule 434") of the 1933 Act Regulations, prepare and file a term sheet (a "Term
Sheet") in accordance with the provisions of Rule 434 and Rule 424(b). Two
forms of prospectus are to be used in connection with the offering and sale of
the Securities: one relating to the U.S. Securities (the "Form of U.S.
Prospectus") and one relating to the International Securities (the "Form of
International Prospectus"). The Form of International Prospectus is identical to
the Form of U.S. Prospectus, except for the front cover and back cover pages and
the information under the caption "Underwriting." The information included in
any such prospectus or in any such Term Sheet, as the case may be, that was
omitted from such registration statement at the time it became effective but
that is deemed to be part of such registration statement at the time it became
effective (a) pursuant to paragraph (b) of Rule 430A is referred to as "Rule
430A Information" or (b) pursuant to paragraph (d) of Rule 434 is referred to as
"Rule 434 Information." Each Form of U.S. Prospectus and Form of International
Prospectus used before such registration statement became effective, and any
prospectus that omitted, as applicable, the Rule 430A Information or the Rule
434 Information, that was used after such effectiveness and prior to the
execution and delivery of this Agreement, is herein called a "preliminary
prospectus." Such registration statement, including the exhibits thereto,
schedules thereto, if any, and the documents incorporated by reference therein
pursuant to Item 12 of Form S-3 under the 1933 Act, at the time it became
effective and including the Rule 430A Information and the Rule 434 Information,
as applicable, is herein called the "Registration Statement." Any registration
statement filed pursuant to Rule 462(b) of the 1933 Act Regulations is herein
referred to as the "Rule 462(b) Registration Statement," and after such filing
the term "Registration Statement" shall include the Rule 462(b) Registration
Statement. The final Form of U.S. Prospectus and the final Form of
International Prospectus, including the documents incorporated by reference
therein pursuant to Item 12 of Form S-3 under the 1933 Act, in the forms first
furnished to the Underwriters for use in connection with the offering of the
Securities are herein called the "U.S. Prospectus" and the "International
Prospectus," respectively, and collectively, the "Prospectuses." If Rule 434 is
relied on, the terms "U.S. Prospectus" and "International Prospectus" shall
refer to the preliminary U.S. Prospectus dated _____, 1998 and preliminary
International Prospectus dated ____, 1998, respectively, each together with the
applicable Term Sheet and all references in this Agreement to the date of such
Prospectuses shall mean the date of the applicable Term Sheet. For purposes of
this Agreement, all references to the Registration Statement, any preliminary
prospectus, the U.S. Prospectus, the International Prospectus or any Term Sheet
or any amendment or supplement to any of the foregoing shall be deemed to
include the copy filed with the Commission pursuant to its Electronic Data
Gathering, Analysis and Retrieval system ("▇▇▇▇▇").
All references in this Agreement to financial statements and schedules and
other information which is "contained," "included" or "stated" in the
Registration Statement, any preliminary prospectus
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(including the Form of U.S. Prospectus and Form of International Prospectus) or
the Prospectuses (or other references of like import) shall be deemed to mean
and include all such financial statements and schedules and other information
which is incorporated by reference in the Registration Statement, any
preliminary prospectus (including the Form of U.S. Prospectus and Form of
International Prospectus) or the Prospectuses, as the case may be; and all
references in this Agreement to amendments or supplements to the Registration
Statement, any preliminary prospectus or the Prospectuses shall be deemed to
mean and include the filing of any document under the Securities Exchange Act of
1934 (the "1934 Act") which is incorporated by reference in the Registration
Statement, such preliminary prospectus or the Prospectuses, as the case may be.
SECTION 1. Representations and Warranties.
------------------------------
(a) Representations and Warranties by the Company. The Company represents
and warrants to each U.S. Underwriter as of the date hereof, as of the Closing
Time referred to in Section 2(c) hereof, and as of each Date of Delivery (if
any) referred to in Section 2(b) hereof, and agrees with each U.S. Underwriter,
as follows:
(i) Compliance with Registration Requirements. The Company meets
-----------------------------------------
the requirements for use of Form S-3 under the 1933 Act. Each of the
Registration Statement and any Rule 462(b) Registration Statement has
become effective under the 1933 Act and no stop order suspending the
effectiveness of the Registration Statement or any Rule 462(b) Registration
Statement has been issued under the 1933 Act and no proceedings for that
purpose have been instituted or are pending or, to the knowledge of the
Company, are contemplated by the Commission, and any request on the part of
the Commission for additional information has been complied with.
At the respective times the Registration Statement, any Rule 462(b)
Registration Statement and any post-effective amendments thereto became
effective and at the Closing Time (and, if any U.S. Option Securities are
purchased, at the Date of Delivery), the Registration Statement, the Rule
462(b) Registration Statement and any amendments and supplements thereto
complied and will comply in all material respects with the requirements of
the 1933 Act and the 1933 Act Regulations and did not and will not contain
an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein
not misleading. Neither of the Prospectuses nor any amendments or
supplements thereto, at the time the Prospectuses or any amendments or
supplements thereto were issued and at the Closing Time (and, if any U.S.
Option Securities are purchased, at the Date of Delivery), included or will
include an untrue statement of a material fact or omitted or will omit to
state a material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not misleading.
If Rule 434 is used, the Company will comply with the requirements of Rule
434. The representations and warranties in this subsection shall not apply
to statements in or omissions from the Registration Statement or the U.S.
Prospectus made in reliance upon and in conformity with information
furnished to the Company in writing by any U.S. Underwriter
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through the U.S. Representatives expressly for use in the Registration
Statement or the U.S. Prospectus.
Each preliminary prospectus and the prospectuses filed as part of the
Registration Statement as originally filed or as part of any amendment
thereto, or filed pursuant to Rule 424 under the 1933 Act, complied when so
filed in all material respects with the 1933 Act Regulations and each
preliminary prospectus and the Prospectuses delivered to the Underwriters
for use in connection with this offering was identical to the
electronically transmitted copies thereof filed with the Commission
pursuant to ▇▇▇▇▇, except to the extent permitted by Regulation S-T.
(ii) Incorporated Documents. The documents incorporated or deemed
----------------------
to be incorporated by reference in the Registration Statement and the
Prospectuses, at the time they were or hereafter are filed with the
Commission, complied and will comply in all material respects with the
requirements of the 1934 Act and the rules and regulations of the
Commission thereunder (the "1934 Act Regulations"), and, when read together
with the other information in the Prospectuses, at the time the
Registration Statement became effective, at the time the Prospectuses were
issued and at the Closing Time (and, if any U.S. Option Securities are
purchased, at the Date of Delivery), did not and will not contain an untrue
statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not
misleading.
(iii) Independent Accountants. The accountants who certified the
-----------------------
financial statements and supporting schedules included in the Registration
Statement are independent public accountants as required by the 1933 Act
and the 1933 Act Regulations.
(iv) Financial Statements. The financial statements of the Company
--------------------
and its consolidated subsidiaries included in the Registration Statement
and the Prospectuses, together with the related schedules and notes, as
well as those financial statements, schedules and notes of any other entity
included therein, present fairly the financial position of the Company and
its consolidated subsidiaries, or such other entity, as the case may be, at
the dates indicated and the statement of operations, shareholders' equity
and cash flows of the Company and its consolidated subsidiaries, or such
other entity, as the case may be, for the periods specified; said financial
statements have been prepared in conformity with generally accepted
accounting principles ("GAAP") applied on a consistent basis throughout the
periods involved except as disclosed therein, except that financial
statements of T&N plc ("T&N") have been prepared in conformity with U.K.
GAAP applied on a consistent basis throughout the periods involved except
as disclosed therein. The supporting schedules, if any, included in the
Registration Statement present fairly in accordance with GAAP, or U.K. GAAP
with respect to T&N supporting schedules, the information required to be
stated therein. The selected financial data and the summary financial
information included in the Prospectuses present fairly the information
shown therein and have been compiled on a basis consistent with that of the
audited financial statements included in the Registration Statement and the
Prospectuses. The pro forma financial statements and the related notes
thereto
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included in the Registration Statement and the Prospectuses present fairly
the information shown therein, have been prepared in accordance with the
Commission's rules and guidelines with respect to pro forma financial
statements and have been properly compiled on the bases described therein,
and the assumptions used in the preparation thereof are reasonable and the
adjustments used therein are appropriate to give effect to the transactions
and circumstances referred to therein.
(v) No Material Adverse Change in Business. Since the respective
--------------------------------------
dates as of which information is given in the Registration Statement and
the Prospectuses, except as otherwise stated therein, (A) there has been no
material adverse change in the condition, financial or otherwise, or in the
earnings, business affairs or business prospects of the Company and its
subsidiaries considered as one enterprise, whether or not arising in the
ordinary course of business (a "Material Adverse Effect"), (B) there have
been no transactions entered into by the Company or any of its
subsidiaries, other than those in the ordinary course of business, which
are material with respect to the Company and its subsidiaries considered as
one enterprise, and (C) except for regular quarterly dividends on the
Common Stock in amounts per share that are consistent with past practice or
with the Company's new dividend policy summarized in the Prospectuses under
the caption "Price Range of Common Stock and Dividends" and dividends on
the Company's outstanding preferred stock in the ordinary course, there has
been no dividend or distribution of any kind declared, paid or made by the
Company on any class of its capital stock.
(vi) Good Standing of the Company. The Company has been duly
----------------------------
organized and is validly existing as a corporation in good standing under
the laws of the State of Michigan and has corporate power and authority to
own, lease and operate its properties and to conduct its business as
described in the Prospectuses and to enter into and perform its obligations
under this Agreement; and the Company is duly qualified as a foreign
corporation to transact business and is in good standing in each other
jurisdiction (including foreign jurisdictions) in which such qualification
is required, whether by reason of the ownership or leasing of property or
the conduct of business, except where the failure so to qualify or to be in
good standing would not result in a Material Adverse Effect.
(vii) Good Standing of Subsidiaries. Each "significant subsidiary"
-----------------------------
of the Company (as such term is defined in Rule 1-02 of Regulation S-X)
(each a "Subsidiary" and, collectively, the "Subsidiaries") has been duly
organized and is validly existing as a corporation in good standing under
the laws of the jurisdiction of its incorporation, has corporate power and
authority to own, lease and operate its properties and to conduct its
business as described in the Prospectuses and is duly qualified as a
foreign corporation to transact business and is in good standing in each
jurisdiction (including foreign jurisdictions) in which such qualification
is required, whether by reason of the ownership or leasing of property or
the conduct of business, except where the failure so to qualify or to be in
good standing would not result in a Material Adverse Effect; except as
otherwise disclosed in the Registration Statement, all of the issued and
outstanding capital stock of each such Subsidiary has been duly authorized
and validly issued, is fully paid and non-assessable and greater than
-6-
90% of such capital stock is owned by the Company, directly or through
subsidiaries, and to the extent such capital stock is owned by the Company
it is owned free and clear of any security interest, mortgage, pledge,
lien, encumbrance, claim or equity; none of the outstanding shares of
capital stock of any Subsidiary was issued in violation of the preemptive
or similar rights of any securityholder of such Subsidiary. The only
subsidiaries of the Company are (a) the subsidiaries listed on Schedule C
hereto and (b) certain other subsidiaries which, considered in the
aggregate as a single subsidiary, do not constitute a "significant
subsidiary" as defined in Rule 1-02 of Regulation S-X.
(viii) Capitalization. The authorized, issued and outstanding
--------------
capital stock of the Company is as set forth in the Prospectuses in the
column entitled "Actual" under the caption "Capitalization" (except for
subsequent issuances, if any, pursuant to this Agreement or the
International Purchase Agreement, pursuant to reservations, agreements or
employee benefit plans referred to in the Prospectuses or pursuant to the
exercise of convertible securities or options referred to in the
Prospectuses). The shares of issued and outstanding capital stock of the
Company have been duly authorized and validly issued and are fully paid and
non-assessable, and the Securities to be issued upon conversion of shares
of Series E Stock held by such Selling Shareholders and to be sold to the
Underwriters hereunder and under the International Purchase Agreement
("Conversion Shares") have been duly authorized and will be, prior to the
Closing Time and at each Time of Delivery (if any), as applicable, duly
authorized and validly issued and fully paid and non-assessable; none of
the outstanding shares of capital stock of the Company was issued, and none
of the Conversion Shares will be issued, in violation of the preemptive or
other similar rights of any securityholder of the Company; as of the
Closing Time and each Date of Delivery (if any), as applicable, shares of
Series E Stock shall have been duly and validly converted into the
appropriate number of Conversion Shares.
(ix) Authorization of Agreement. This Agreement and the
--------------------------
International Purchase Agreement have been duly authorized, executed and
delivered by the Company.
(x) Authorization and Description of Securities. The Securities
-------------------------------------------
to be purchased by the U.S. Underwriters and the International Managers
from the Company have been duly authorized for issuance and sale to the
U.S. Underwriters pursuant to this Agreement and the International Managers
pursuant to the International Purchase Agreement, respectively, and, when
issued and delivered by the Company pursuant to this Agreement and the
International Purchase Agreement, respectively, against payment of the
consideration set forth herein and in the International Purchase Agreement,
respectively, will be validly issued, fully paid and non-assessable; the
Common Stock conforms to all statements relating thereto contained in the
Prospectuses and such description conforms in all material respects to the
rights set forth in the instruments defining the same; no holder of the
Securities will be subject to personal liability by reason of being such a
holder; and the issuance of the Securities is not subject to the preemptive
or other similar rights of any securityholder of the Company.
-7-
(xi) Absence of Defaults and Conflicts. Neither the Company nor
---------------------------------
any of its subsidiaries is in violation of its charter or by-laws or in
default in the performance or observance of any obligation, agreement,
covenant or condition contained in any contract, indenture, mortgage, deed
of trust, loan or credit agreement, note, lease or other agreement or
instrument to which the Company or any of its subsidiaries is a party or by
which it or any of them may be bound, or to which any of the property or
assets of the Company or any subsidiary is subject (collectively,
"Agreements and Instruments") except for such defaults that would not
result in a Material Adverse Effect; and the execution, delivery and
performance of this Agreement and the International Purchase Agreement and
the consummation of the transactions contemplated in this Agreement, in the
International Purchase Agreement and in the Registration Statement
(including the issuance and sale of the Securities and the use of the
proceeds from the sale of the Securities as described in the Prospectuses
under the caption "Use of Proceeds") and compliance by the Company with its
obligations under this Agreement and the International Purchase Agreement
have been duly authorized by all necessary corporate action and do not and
will not, whether with or without the giving of notice or passage of time
or both, conflict with or constitute a breach of, or default or Repayment
Event (as defined below) (except to the extent described in the
Prospectuses under the caption "Description of Certain Indebtedness--
Repayments and Refinancings") under, or result in the creation or
imposition of any lien, charge or encumbrance upon any property or assets
of the Company or any subsidiary pursuant to, the Agreements and
Instruments (except for such conflicts, breaches or defaults or liens,
charges or encumbrances that would not result in a Material Adverse
Effect), nor will such action result in any violation of the provisions of
the charter or by-laws of the Company or any subsidiary or any applicable
law, statute, rule, regulation, judgment, order, writ or decree of any
government, government instrumentality or court, domestic or foreign,
having jurisdiction over the Company or any subsidiary or any of their
assets, properties or operations. As used herein, a "Repayment Event" means
any event or condition which gives the holder of any note, debenture or
other evidence of indebtedness (or any person acting on such holder's
behalf) the right to require the repurchase, redemption or repayment of all
or a portion of such indebtedness by the Company or any subsidiary.
(xii) Absence of Labor Dispute. No labor dispute with the employees
------------------------
of the Company or any subsidiary exists or, to the knowledge of the
Company, is imminent which may reasonably be expected to result in a
Material Adverse Effect.
(xiii) Absence of Proceedings. There is no action, suit,
----------------------
proceeding, inquiry or investigation before or brought by any court or
governmental agency or body, domestic or foreign, now pending, or, to the
knowledge of the Company, threatened, against or affecting the Company or
any subsidiary, which is required to be disclosed in the Registration
Statement (other than as disclosed therein), or which might reasonably be
expected to result in a Material Adverse Effect, or which might reasonably
be expected to materially and adversely affect the consummation of the
transactions contemplated by this Agreement and the International Purchase
Agreement or the performance by the Company of its obligations hereunder or
thereunder; the aggregate of all pending legal or governmental proceedings
to
-8-
which the Company or any subsidiary is a party or of which any of their
respective properties, assets or operations is the subject which are not
described in the Registration Statement and the Prospectuses, including
ordinary routine litigation incidental to the business, could not
reasonably be expected to result in a Material Adverse Effect.
(xiv) Accuracy of Exhibits. There are no contracts or documents
--------------------
which are required to be described in the Registration Statement, the
Prospectuses or the documents incorporated by reference therein or to be
filed as exhibits thereto which have not been so described and filed as
required.
(xv) Possession of Intellectual Property. The Company and its
-----------------------------------
subsidiaries own or possess, or can acquire on reasonable terms, adequate
patents, patent rights, licenses, inventions, copyrights, know-how
(including trade secrets and other unpatented and/or unpatentable
proprietary or confidential information, systems or procedures),
trademarks, service marks, trade names or other intellectual property
(collectively, "Intellectual Property") necessary to carry on the business
now operated by them, except where the failure to own or possess or
otherwise be able to acquire such Intellectual Property would not result in
a Material Adverse Effect, and neither the Company nor any of its
subsidiaries has received any notice or is otherwise aware of any
infringement of or conflict with asserted rights of others with respect to
any Intellectual Property or of any facts or circumstances which would
render any Intellectual Property invalid or inadequate to protect the
interest of the Company or any of its subsidiaries therein, and which
infringement or conflict (if the subject of any unfavorable decision,
ruling or finding) or invalidity or inadequacy, singly or in the aggregate,
would result in a Material Adverse Effect.
(xvi) Absence of Further Requirements. No filing with, or
-------------------------------
authorization, approval, consent, license, order, registration,
qualification or decree of, any court or governmental authority or agency,
domestic or foreign, is necessary or required for the performance by the
Company of its obligations hereunder, in connection with the offering,
issuance or sale of the Securities by the Company under this Agreement and
the International Purchase Agreement or the consummation by the Company of
the transactions contemplated by this Agreement and the International
Purchase Agreement, except such as have been already obtained or as may be
required under the 1933 Act or the 1933 Act Regulations and foreign or
state securities or blue sky laws.
(xvii) Possession of Licenses and Permits. The Company and its
----------------------------------
subsidiaries possess such permits, licenses, approvals, consents and other
authorizations (collectively, "Governmental Licenses") issued by the
appropriate federal, state, local or foreign regulatory agencies or bodies
necessary to conduct the business now operated by them; the Company and its
subsidiaries are in compliance with the terms and conditions of all such
Governmental Licenses, except where the failure so to comply would not,
singly or in the aggregate, have a Material Adverse Effect; all of the
Governmental Licenses are valid and in full force and effect, except when
the invalidity of such Governmental Licenses or the failure of such
Governmental Licenses to be in full force and effect would not have a
Material Adverse
-9-
Effect; and neither the Company nor any of its subsidiaries has received
any notice of proceedings relating to the revocation or modification of any
such Governmental Licenses which, singly or in the aggregate, if the
subject of an unfavorable decision, ruling or finding, would result in a
Material Adverse Effect.
(xviii) Title to Property. The Company and its subsidiaries have
-----------------
good and marketable title to all real property owned by the Company and its
subsidiaries which is material to the business of the Company and its
subsidiaries taken as a whole and good title to all other properties owned
by them which is material to the business of the Company and its
subsidiaries taken as a whole, in each case, free and clear of all
mortgages, pledges, liens, security interests, claims, restrictions or
encumbrances of any kind except such as (a) are described in the
Prospectuses or (b) do not, singly or in the aggregate, materially affect
the value of such property and do not interfere with the use made and
proposed to be made of such property by the Company or any of its
subsidiaries; and all of the leases and subleases material to the business
of the Company and its subsidiaries, considered as one enterprise, and
under which the Company or any of its subsidiaries holds properties
described in the Prospectuses, are in full force and effect, and neither
the Company nor any subsidiary has any notice of any material claim of any
sort that has been asserted by anyone adverse to the rights of the Company
or any subsidiary under any of the leases or subleases mentioned above, or
affecting or questioning the rights of the Company or such subsidiary to
the continued possession of the leased or subleased premises under any such
lease or sublease.
(xix) [Intentionally omitted.]
(xx) Investment Company Act. The Company is not, and upon the
----------------------
issuance and sale of the Securities as herein contemplated and the
application of the net proceeds therefrom as described in the Prospectuses
will not be, an "investment company" or an entity "controlled" by an
"investment company" as such terms are defined in the Investment Company
Act of 1940, as amended (the "1940 Act").
(xxi) Environmental Laws. Except as described in the Registration
------------------
Statement and except as would not, singly or in the aggregate, result in a
Material Adverse Effect, (A) neither the Company nor any of its
subsidiaries is in violation of any federal, state, local or foreign
statute, law, rule, regulation, ordinance, code, policy or rule of common
law or any judicial or administrative interpretation thereof, including any
judicial or administrative order, consent, decree or judgment, relating to
pollution or protection of human health, the environment (including,
without limitation, ambient air, surface water, groundwater, land surface
or subsurface strata) or wildlife, including, without limitation, laws and
regulations relating to the release or threatened release of chemicals,
pollutants, contaminants, wastes, toxic substances, hazardous substances,
petroleum or petroleum products (collectively, "Hazardous Materials") or to
the manufacture, processing, distribution, use, treatment, storage,
disposal, transport or handling of Hazardous Materials (collectively,
"Environmental Laws"), (B) the Company and its subsidiaries have all
permits, authorizations and approvals required under any applicable
Environmental Laws and are each in compliance with their
-10-
requirements, (C) there are no pending or, to the Company's knowledge,
threatened administrative, regulatory or judicial actions, suits, demands,
demand letters, claims, liens, notices of noncompliance or violation,
investigation or proceedings relating to any Environmental Law against the
Company or any of its subsidiaries and (D) there are no events or
circumstances that might reasonably be expected to form the basis of an
order for clean-up or remediation, or an action, suit or proceeding by any
private party or governmental body or agency, against or affecting the
Company or any of its subsidiaries relating to Hazardous Materials or any
Environmental Laws.
(xxii) Registration Rights. There are no persons with registration
-------------------
rights or other similar rights to have any securities registered pursuant
to the Registration Statement or otherwise registered by the Company under
the 1933 Act, except for persons who are Selling Shareholders or other
shareholders described in the Prospectus as having registration rights.
Each Selling Shareholder has validly and effectively exercised such Selling
Shareholder's rights to require registration of Conversion Shares because
of the filing of the Registration Statement and the consummation of the
transactions contemplated by this Agreement and the International Purchase
Agreement and each Selling Shareholder, with respect to any securities of
the Company other than Conversion Shares, and each other holder of any
security of the Company that has any right to require registration of
shares of Common Stock or any other security of the Company because of the
filing of the Registration Statement or consummation of the transactions
contemplated by this Agreement or the International Purchase Agreement, has
validly and effectively waived such rights.
(b) Representations and Warranties by the Selling Shareholders and
Covenants of the Selling Shareholders. Each Selling Shareholder severally and
not jointly represents and warrants to each U.S. Underwriter as of the date
hereof, as of the Closing Time, and as of each Date of Delivery (if any)
referred to in Section 2(b) hereof, and agrees with each U.S. Underwriter, as
follows:
(i) Accurate Disclosure. [With respect to ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ and
-------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇▇: the representations and warranties of the Company contained
in Section 1(a) hereof, insofar as they relate to Fel-Pro Incorporated and
the affiliated companies purchased together with Fel-Pro Incorporated by
Federal-Mogul (collectively, "Fel-Pro") or information about Fel-Pro at or
prior to the Company's acquisition thereof, are true and correct.] Each
Selling Shareholder has reviewed and is familiar with the Registration
Statement and the Prospectuses and neither the Prospectuses nor any
amendments or supplements thereto include any untrue statement of a
material fact with respect to such Selling Shareholder [and, with respect
to ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ and ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, Fel-Pro] or omits to state a
material fact with respect to such Selling Shareholder [and, with respect
to ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ and ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, Fel-Pro] necessary in order to make
the statements therein, in the light of the circumstances under which they
were made, not misleading.
(ii) Authorization of Agreements. Such Selling Shareholder has the
---------------------------
full right, power and authority to enter into this Agreement, the
International Purchase Agreement and a Power of Attorney and Custody
Agreement (in each case, a "Power of Attorney and Custody
-11-
Agreement") and to sell and cause to be delivered the Securities to be sold
by such Selling Shareholder hereunder and thereunder. The execution and
delivery of this Agreement, the International Purchase Agreement and the
Power of Attorney and Custody Agreement and the sale and delivery of the
Securities to be sold by such Selling Shareholder and the consummation of
the transactions contemplated herein and therein and compliance by such
Selling Shareholder with its obligations hereunder and thereunder have been
duly authorized, if necessary, by such Selling Shareholder and do not and
will not, whether with or without the giving of notice or passage of time
or both, conflict with or constitute a breach of, or default under, or
result in the creation or imposition of any lien, charge or encumbrance
upon the Securities to be sold by such Selling Shareholder nor will such
action result in any violation of the provisions of the charter or by-laws
or other organizational or governing instrument of such Selling
Shareholder, if applicable, or any applicable law, statute, rule,
regulation, judgment, order, writ or decree of any government, government
instrumentality or court, domestic or foreign, having jurisdiction over
such Selling Shareholder or any of its properties.
(iii) Good and Marketable Title. Such Selling Shareholder has good
-------------------------
and marketable title to the shares of Series E Stock to be converted into
Conversion Shares and sold by such Selling Shareholder pursuant hereto and
the International Purchase Agreement, free and clear of any security
interest, mortgage pledge, lien, claim, equity or encumbrance, and at the
Closing Time and at each applicable Time of Delivery (if any), as
applicable, and upon delivery of such Securities and payment of the
purchase price therefor as herein contemplated, assuming due authorization
and valid issuance of the Conversion Shares by the Company and assuming
each such Underwriter has no notice of any adverse claim, each of the
Underwriters will receive good and marketable title to the Securities
purchased by it from such Selling Shareholder, free and clear of any
security interest, mortgage, pledge, lien, encumbrance, claim or equity,
except for any lien created by such Underwriter.
(iv) Due Execution of Power of Attorney and Custody Agreement. Such
--------------------------------------------------------
Selling Shareholder has duly executed and delivered, in the form heretofore
furnished to the Representatives, the Power of Attorney and Custody
Agreement with ________________, _______________ or ________________ as
attorney-in-fact and custodian (each a "Shareholder Representatives"); the
Shareholder Representatives are authorized to take such actions as are
necessary to validly and effectively exercise such Selling Shareholder's
rights to require registration of Conversion Shares and to waive any such
rights with respect to any other securities of the Company, to take such
actions as are necessary to validly effectuate the conversion of shares of
Series E Stock held by such Selling Shareholder into Conversion Shares, to
direct the Company to deliver the Securities to be sold by such Selling
Shareholder hereunder and under the International Purchase Agreement and to
accept payment therefor; and each Shareholder Representative is authorized
to execute and deliver this Agreement and the International Purchase
Agreement and the certificate referred to in Section 5(f) or that may be
required pursuant to Section 5(l) on behalf of such Selling Shareholder, to
sell to the Underwriters the Securities to be sold by such Selling
Shareholder hereunder and under the International Purchase Agreement, to
determine the purchase price to be paid by the
-12-
Underwriters to such Selling Shareholder, as provided in Section 2(a)
hereof, to authorize the delivery of the Securities to be sold by such
Selling Shareholder hereunder and under the International Purchase
Agreement, to accept payment therefor, and otherwise to act on behalf of
such Selling Shareholder in connection with this Agreement and under the
International Purchase Agreement.
(v) Absence of Manipulation. Such Selling Shareholder 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 stabilization or manipulation of the price of any
security of the Company to facilitate the sale or resale of the Securities.
(vi) Absence of Further Requirements. No filing with, or
-------------------------------
authorization, approval, consent, order, registration, qualification or
decree of, any court or governmental authority or agency, domestic or
foreign, is necessary or required for the performance by such Selling
Shareholder of its obligations hereunder, under the International Purchase
Agreement or in the Power of Attorney and Custody Agreement, or in
connection with the offering or sale of the Securities hereunder or under
the International Purchase Agreement or the consummation of the
transactions contemplated by this Agreement except such as may have been
previously been made or obtained or as may be required under the 1933 Act
or the 1933 Act Regulations or state securities laws.
(vii) Restriction on Sale of Securities. During a period of 90 days
---------------------------------
from the date of the Prospectuses, such Selling Shareholder will not,
without the prior written consent of the Global Coordinator, (i) directly
or indirectly offer, pledge, sell, contract to sell, sell any options or
contract to purchase, purchase any option or contract to sell, grant any
option, right or warrant to purchase or otherwise transfer or dispose of
any share of Common Stock or any securities convertible into or exercisable
or exchangeable for Common Stock or file any registration statement under
the 1933 Act with respect to any of the foregoing or (ii) enter into any
swap or any other agreement or any transaction that transfers, in whole or
in part, directly or indirectly, the economic consequences of ownership of
the Common Stock, whether any such swap or transaction described in clause
(i) or (ii) above is to be settled by delivery of Common Stock or such
other securities, in cash or otherwise. The foregoing sentence shall not
apply to the Securities to be sold under this Agreement of the
International Purchase Agreement.
(viii) Certificates Suitable for Transfer. Certificates
----------------------------------
representing shares of Series E Stock to be converted into at least the
maximum number of Conversion Shares to be sold by such Selling Shareholder
to the Underwriters hereunder and under the International Purchase
Agreement, in suitable form for transfer by delivery or accompanied by duly
executed instruments of transfer or assignment in blank with signatures
guaranteed, have been placed in custody with such Selling Shareholder's
Shareholder Representative with irrevocable conditional instructions to
deliver such certificates to the Company for conversion into Conversion
Shares to be delivered to the Underwriters pursuant to this Agreement and
the International Purchase Agreement.
-13-
(ix) No Association with NASD. Neither such Selling Shareholder nor
------------------------
any of its affiliates directly, or indirectly through one or more
intermediaries, controls, or is controlled by, or is under common control
with, or has any other association with (within the meaning of Article I,
Section 1(m) of the By-laws of the National Association of Securities
Dealers, Inc.), any member firm of the National Association of Securities
Dealers, Inc.
(x) Registration Rights. Such Selling Shareholder has validly and
-------------------
effectively exercised such Selling Shareholder's rights to require
registration of Conversion Shares because of the filing of the Registration
Statement and the consummation of the transaction contemplated by the
Agreement and the International Purchase Agreement and such Selling
Shareholder has not, and will not, exercise any other right to require
registration of shares of Common Stock or any other security of the Company
(other than Conversion Shares) because of the filing of the Registration
Statement or consummation of the transactions contemplated by this
Agreement or the International Purchase Agreement.
(c) Officer's Certificates. Any certificate signed by any officer of the
Company or any of its subsidiaries delivered to the Global Coordinator, the U.S.
Representatives or to counsel for the U.S. Underwriters shall be deemed a
representation and warranty by the Company to each U.S. Underwriter as to the
matters covered thereby.
(d) Selling Shareholder's Certificates. Any certificate signed by or on
behalf of a Selling Shareholder delivered to the Global Coordinator, the U.S.
Representatives or to counsel for the U.S. Underwriters shall be deemed a
representation and warranty by such Selling Shareholder to each U.S. Underwriter
as to the matters covered thereby.
SECTION 2. Sale and Delivery to U.S. Underwriters; Closing.
-----------------------------------------------
(a) Initial Securities. On the basis of the representations and
warranties herein contained and subject to the terms and conditions herein set
forth, the Company and each Selling Shareholder, severally and not jointly,
agree to sell to each U.S. Underwriter, severally and not jointly, and each U.S.
Underwriter, severally and not jointly, agrees to purchase from the Company and
each Selling Shareholder, at the price per share set forth in Schedule B, that
proportion of the number of Initial U.S. Securities set forth in Schedule A-2
opposite the name of the Company or such Selling Shareholder, as the case may
be, which the number of Initial U.S. Securities set forth in Schedule A opposite
the name of such U.S. Underwriter, plus any additional number of Initial U.S.
Securities which such U.S. Underwriter may become obligated to purchase pursuant
to the provisions of Section 10 hereof, bears to the total number of Initial
U.S. Securities, subject, in each case to such adjustments among the U.S.
Underwriters as the U.S. Representatives in their sole discretion shall make to
eliminate any sales or purchases of fractional securities.
(b) Option Securities. In addition, on the basis of the representations
and warranties herein contained and subject to the terms and conditions herein
set forth, the Company and the Selling Shareholders, acting severally and not
jointly, hereby grant an option to the U.S. Underwriters, severally and not
jointly, to purchase up to an additional ____________ shares of Common Stock
-14-
at the price per share set forth in Schedule B, less an amount per share equal
to any dividends or distributions declared by the Company and payable on the
Initial U.S. Securities but not payable on the U.S. Option Securities. The
option hereby granted will expire 30 days after the date hereof and may be
exercised in whole or in part from time to time only for the purpose of covering
over-allotments which may be made in connection with the offering and
distribution of the Initial U.S. Securities upon notice by the Global
Coordinator to the Company and the Selling Shareholders setting forth the number
of U.S. Option Securities as to which the several U.S. Underwriters are then
exercising the option and the time and date of payment and delivery for such
U.S. Option Securities. Any such time and date of delivery for the U.S. Option
Securities (a "Date of Delivery") shall be determined by the Global Coordinator,
but shall not be later than seven full business days after the exercise of said
option, nor in any event prior to the Closing Time, as hereinafter defined. If
the option is exercised as to all or any portion of the U.S. Option Securities,
each of the U.S. Underwriters, acting severally and not jointly, will purchase
that proportion of the total number of U.S. Option Securities then being
purchased which the number of Initial U.S. Securities set forth in Schedule A
opposite the name of such U.S. Underwriter bears to the total number of Initial
U.S. Securities, subject in each case to such adjustments as the Global
Coordinator in its discretion shall make to eliminate any sales or purchases of
fractional shares.
(c) Payment. Payment of the purchase price for, and delivery of
certificates for, the Initial Securities shall be made at the offices of Sidley
& Austin, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, or at such other
place as shall be agreed upon by the Global Coordinator and the Company, at 9:00
A.M. (Eastern time) on the third (fourth, if the pricing occurs after 4:30 P.M.
(Eastern time) on any given day) business day after the date hereof (unless
postponed in accordance with the provisions of Section 10), or such other time
not later than ten business days after such date as shall be agreed upon by the
Global Coordinator and the Company (such time and date of payment and delivery
being herein called "Closing Time").
In addition, in the event that any or all of the U.S. Option Securities are
purchased by the U.S. Underwriters, payment of the purchase price for, and
delivery of certificates for, such U.S. Option Securities shall be made at the
above-mentioned offices, or at such other place as shall be agreed upon by the
Global Coordinator and the Company, on each Date of Delivery as specified in the
notice from the Global Coordinator to the Company.
Payment shall be made to the Company and the Selling Shareholders by wire
transfer of immediately available funds to bank accounts designated by the
Company and the Shareholder Representatives Custodian pursuant to each Selling
Shareholder's Power of Attorney and Custody Agreement, as the case may be,
against delivery to the U.S. Representatives for the respective accounts of the
U.S. Underwriters of certificates for the U.S. Securities to be purchased by
them. It is understood that each U.S. Underwriter has authorized the U.S.
Representatives, for its account, to accept delivery of, receipt for, and make
payment of the purchase price for, the Initial U.S. Securities and the U.S.
Option Securities, if any, which it has agreed to purchase. ▇▇▇▇▇▇▇ ▇▇▇▇▇,
individually and not as representative of the U.S. Underwriters, may (but shall
not be obligated to) make payment of the purchase price for the Initial U.S.
Securities or the U.S. Option Securities, if any, to be purchased by any U.S.
Underwriter whose funds have not been received by the Closing
-15-
Time or the relevant Date of Delivery, as the case may be, but such payment
shall not relieve such U.S. Underwriter from its obligations hereunder.
(d) Denominations; Registration. Certificates for the Initial U.S.
Securities and the U.S. Option Securities, if any, shall be in such
denominations and registered in such names as the U.S. Representatives may
request in writing at least one full business day before the Closing Time or the
relevant Date of Delivery, as the case may be. The certificates for the Initial
U.S. Securities and the U.S. Option Securities, if any, will be made available
for examination and packaging by the U.S. Representatives in The City of New
York not later than 10:00 A.M. (Eastern time) on the business day prior to the
Closing Time or the relevant Date of Delivery, as the case may be.
SECTION 3. Covenants of the Company. The Company covenants with each
------------------------
U.S. Underwriter as follows:
(a) Compliance with Securities Regulations and Commission Requests. The
Company, subject to Section 3(b), will comply with the requirements of Rule 430A
or Rule 434, as applicable, and, during the period in which the Prospectuses are
required to be delivered in connection with the sales of the Common Stock
purchased pursuant to this Agreement, will notify the Global Coordinator
immediately, and confirm the notice in writing, (i) when any post-effective
amendment to the Registration Statement shall become effective, or any
supplement to the Prospectuses or any amended Prospectuses shall have been
filed, (ii) of the receipt of any comments from the Commission, (iii) of any
request by the Commission for any amendment to the Registration Statement or any
amendment or supplement to the Prospectuses or for additional information, and
(iv) of the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or of any order preventing or
suspending the use of any preliminary prospectus, or of the suspension of the
qualification of the Securities for offering or sale in any jurisdiction, or of
the initiation or threatening of any proceedings for any of such purposes. The
Company will promptly effect the filings necessary pursuant to Rule 424(b) and
will take such steps as it deems necessary to ascertain promptly whether the
form of prospectus transmitted for filing under Rule 424(b) was received for
filing by the Commission and, in the event that it was not, it will promptly
file such prospectus. The Company will make every reasonable effort to prevent
the issuance of any stop order and, if any stop order is issued, to obtain the
lifting thereof at the earliest possible moment.
(b) Filing of Amendments. The Company will, during the period in which
the Prospectuses are required by the 1933 Act to be delivered in connection with
sales of the Common Stock purchased pursuant to this Agreement, give the Global
Coordinator notice of its intention to file or prepare any amendment to the
Registration Statement (including any filing under Rule 462(b)), any Term Sheet
or any amendment, supplement or revision to either the prospectus included in
the Registration Statement at the time it became effective or to the
Prospectuses, whether pursuant to the 1933 Act, the 1934 Act or otherwise, will
furnish the Global Coordinator with copies of any such documents a reasonable
amount of time prior to such proposed filing or use, as the case may be, and
will not file or use any such document to which the Global Coordinator or
counsel for the U.S. Underwriters shall reasonably object.
-16-
(c) Delivery of Registration Statements. The Company has furnished or
will deliver to the U.S. Representatives and counsel for the U.S. Underwriters,
without charge, signed copies of the Registration Statement as originally filed
and of each amendment thereto (including exhibits filed therewith or
incorporated by reference therein and documents incorporated or deemed to be
incorporated by reference therein) and signed copies of all consents and
certificates of experts, and will also deliver to the U.S. Representatives,
without charge, a conformed copy of the Registration Statement as originally
filed and of each amendment thereto (without exhibits) for each of the U.S.
Underwriters. The copies of the Registration Statement and each amendment
thereto furnished to the U.S. Underwriters will be identical to the
electronically transmitted copies thereof filed with the Commission pursuant to
▇▇▇▇▇, except to the extent permitted by Regulation S-T.
(d) Delivery of Prospectuses. The Company has delivered to each U.S.
Underwriter, without charge, as many copies of each preliminary prospectus as
such U.S. Underwriter reasonably requested, and the Company hereby consents to
the use of such copies for purposes permitted by the 1933 Act. The Company will
furnish to each U.S. Underwriter, without charge, during the period when the
U.S. Prospectus is required to be delivered under the 1933 Act or the 1934 Act,
such number of copies of the U.S. Prospectus (as amended or supplemented) as
such U.S. Underwriter may reasonably request. The U.S. Prospectus and any
amendments or supplements thereto furnished to the U.S. Underwriters will be
identical to the electronically transmitted copies thereof filed with the
Commission pursuant to ▇▇▇▇▇, except to the extent permitted by Regulation S-T.
(e) Continued Compliance with Securities Laws. The Company will comply
with the 1933 Act and the 1933 Act Regulations and the 1934 Act and the 1934 Act
Regulations so as to permit the completion of the distribution of the Securities
as contemplated in this Agreement, the International Purchase Agreement and in
the Prospectuses. If at any time when a prospectus is required by the 1933 Act
to be delivered in connection with sales of the Securities, any event shall
occur or condition shall exist as a result of which it is necessary, in the
opinion of counsel for the U.S. Underwriters or for the Company, to amend the
Registration Statement or amend or supplement any Prospectus in order that the
Prospectuses will not include any untrue statements of a material fact or omit
to state a material fact necessary in order to make the statements therein not
misleading in the light of the circumstances existing at the time it is
delivered to a purchaser, or if it shall be necessary, in the opinion of such
counsel, at any such time to amend the Registration Statement or amend or
supplement any Prospectus in order to comply with the requirements of the 1933
Act or the 1933 Act Regulations, the Company will promptly prepare and file with
the Commission, subject to Section 3(b), such amendment or supplement as may be
necessary to correct such statement or omission or to make the Registration
Statement or the Prospectuses comply with such requirements, and the Company
will furnish to the U.S. Underwriters such number of copies of such amendment or
supplement as the U.S. Underwriters may reasonably request.
(f) Blue Sky Qualifications. The Company will use its best efforts, in
cooperation with the U.S. Underwriters, to qualify the Securities for offering
and sale under the applicable securities laws of such states and other
jurisdictions (domestic or foreign) as the Global Coordinator may designate and
to maintain such qualifications in effect for a period of not less than one year
from the
-17-
later of the effective date of the Registration Statement and any Rule 462(b)
Registration Statement; provided, however, that the Company shall not be
obligated to file any general consent to service of process or to qualify as a
foreign corporation or as a dealer in securities in any jurisdiction in which it
is not so qualified or to subject itself to taxation in respect of doing
business in any jurisdiction in which it is not otherwise so subject. In each
jurisdiction in which the Securities have been so qualified, the Company will
file such statements and reports as may be required by the laws of such
jurisdiction to continue such qualification in effect for a period of not less
than one year from the effective date of the Registration Statement and any Rule
462(b) Registration Statement.
(g) Earnings Statement. The Company will timely file such reports
pursuant to the 1934 Act as are necessary in order to make generally available
to its securityholders as soon as practicable an earnings statement for the
purposes of, and to provide the benefits contemplated by, the last paragraph of
Section 11(a) of the 1933 Act.
(h) Use of Proceeds. The Company will use the net proceeds received by it
from the sale of the Securities in the manner specified in the Prospectuses
under "Use of Proceeds".
(i) Listing. The Company will use its best efforts to effect the listing
of the Securities on the New York Stock Exchange.
(j) Restriction on Sale of Securities. During a period of 90 days from
the date of the Prospectuses, the Company will not, without the prior written
consent of the Global Coordinator, (i) directly or indirectly, offer, pledge,
sell, contract to sell, sell any option or contract to purchase, purchase any
option or contract to sell, grant any option, right or warrant to purchase or
otherwise transfer or dispose of any share of Common Stock or any securities
convertible into or exercisable or exchangeable for Common Stock or file any
registration statement under the 1933 Act with respect to any of the foregoing
or (ii) enter into any swap or any other agreement or any transaction that
transfers, in whole or in part, directly or indirectly, the economic consequence
of ownership of the Common Stock, whether any such swap or transaction described
in clause (i) or (ii) above is to be settled by delivery of Common Stock or such
other securities, in cash or otherwise. The foregoing sentence shall not apply
to (A) the Securities to be sold hereunder or under the International Purchase
Agreement, (B) any shares of Common Stock issued by the Company upon the
exercise of an option or warrant or the conversion of a security outstanding on
the date hereof and referred to in the Prospectuses or the documents
incorporated therein by reference (as of the date of the Prospectuses), (C) any
shares of Common Stock issued or options to purchase Common Stock granted
pursuant to existing employee benefit plans of the Company referred to in the
Prospectuses or the documents incorporated therein by reference (as of the date
of the Prospectuses), (D) any shares of Common Stock issued pursuant to any non-
employee director stock plan or dividend reinvestment plan, (E) any securities
issued as consideration for or to otherwise finance an acquisition of capital
stock or assets of a business, provided that the recipient of any such
-------- ----
securities agrees in writing to be bound by the restrictions set forth in this
Section 3(j) or (F) [cover trust preferred securities and Series E Stock]
(k) Reporting Requirements. The Company, during the period when the
Prospectuses are required to be delivered under the 1933 Act or the 1934 Act,
will file all documents required to
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be filed with the Commission pursuant to the 1934 Act within the time periods
required by the 1934 Act and the 1934 Act Regulations.
SECTION 4. Payment of Expenses. (a) Expenses. The Company will pay
-------------------
all expenses incident to the performance of its obligations under this
Agreement, including (i) the preparation, printing and filing of the
Registration Statement (including financial statements and exhibits) as
originally filed and of each amendment thereto, (ii) the preparation, printing
and delivery to the Underwriters of this Agreement, any Agreement among
Underwriters and such other documents as may be required in connection with the
offering, purchase, sale, issuance or delivery of the Securities, (iii) the
preparation, issuance and delivery of the certificates for the Securities to the
Underwriters, including any stock or other transfer taxes and any stamp or other
duties payable upon the sale, issuance or delivery of the Securities to the
Underwriters and the transfer of the Securities between the U.S. Underwriters
and the International Managers, (iv) the fees and disbursements of the Company's
counsel, accountants and other advisors, (v) the qualification of the Securities
under securities laws in accordance with the provisions of Section 3(f) hereof,
including filing fees and the reasonable fees and disbursements of counsel for
the Underwriters in connection therewith and in connection with the preparation
of the Blue Sky Survey and any supplement thereto, (vi) the printing and
delivery to the Underwriters of copies of each preliminary prospectus, any Term
Sheets and of the Prospectuses and any amendments or supplements thereto, (vii)
the preparation, printing and delivery to the Underwriters of copies of the Blue
Sky Survey and any supplement thereto, (viii) the fees and expenses of any
transfer agent or registrar for the Securities, (ix) the filing fees incident
to, and the reasonable fees and disbursements of counsel to the Underwriters in
connection with, the review by the National Association of Securities Dealers,
Inc. (the "NASD") of the terms of the sale of the Securities and (x) the fees
and expenses incurred in connection with the listing of the Securities on the
New York Stock Exchange.
(b) Termination of Agreement. If this Agreement is terminated by the
U.S. Representatives in accordance with the provisions of Section 5 or Section
9(a)(i) hereof, the Company shall reimburse the U.S. Underwriters for all of
their out-of-pocket expenses, including the reasonable fees and disbursements of
counsel for the U.S. Underwriters.
SECTION 5. Conditions of U.S. Underwriters' Obligations. The
--------------------------------------------
obligations of the several U.S. Underwriters hereunder are subject to the
accuracy of the representations and warranties of the Company and the Selling
Shareholders contained in Section 1 hereof or in certificates of any officer of
the Company or any subsidiary of the Company or on behalf of any Selling
Shareholder delivered pursuant to the provisions hereof, to the performance by
the Company of its covenants and other obligations hereunder, and to the
following further conditions:
(a) Effectiveness of Registration Statement. The Registration Statement,
including any Rule 462(b) Registration Statement, has become effective and at
Closing Time no stop order suspending the effectiveness of the Registration
Statement shall have been issued under the 1933 Act or proceedings therefor
initiated or threatened by the Commission, and any request on the part of the
Commission for additional information shall have been complied with to the
reasonable satisfaction of counsel to the U.S. Underwriters. A prospectus
containing the Rule 430A Information shall have
-19-
been filed with the Commission in accordance with Rule 424(b) (or a post-
effective amendment providing such information shall have been filed and
declared effective in accordance with the requirements of Rule 430A) or, if the
Company has elected to rely upon Rule 434, a Term Sheet shall have been filed
with the Commission in accordance with Rule 424(b).
(b) Opinion of Counsel for Company. At Closing Time, the U.S.
Representatives shall have received the favorable opinion, dated as of Closing
Time, of each of ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Associate General Counsel of the Company and
Cleary, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, counsel for the Company, each in form and
substance satisfactory to counsel for the U.S. Underwriters, together with
signed or reproduced copies of such letter for each of the other U.S.
Underwriters to the effect set forth in Exhibit A hereto and to such further
effect as counsel to the U.S. Underwriters may reasonably request.
(c) Opinion of Counsel for the Selling Shareholders. At Closing Time, the
Representatives shall have received the favorable opinion, dated as of Closing
Time, of ▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇, counsel for the Selling Shareholders, in form
and substance satisfactory to counsel for the U.S. Underwriters, together with
signed or reproduced copies of such letter for each of the other U.S.
Underwriters to the effect set forth in Exhibit A-2 hereto and to such further
effect as counsel to the U.S. Underwriters may reasonably request.
(d) Opinion of Counsel for U.S. Underwriters. At Closing Time, the U.S.
Representatives shall have received the favorable opinion, dated as of Closing
Time, of each of (A) ▇▇▇▇▇▇ & ▇▇▇▇▇▇, counsel for the U.S. Underwriters,
together with signed or reproduced copies of such letter for each of the other
U.S. Underwriters with respect to the matters set forth in clauses (i), (ii),
(v), (vi) (solely as to preemptive or other similar rights arising by operation
of law or under the charter or by-laws of the Company), (viii) through (x),
inclusive, (xiii), (xv) (solely as to the information in the Prospectus under
"Description of Capital Stock--Common Stock") and the penultimate paragraph of
Exhibit A hereto and (B) ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇, Ltd., special counsel to the U.S.
Underwriters, together with signed or reproduced copies of such letter for each
of the other U.S. Underwriters with respect to matters set forth in the
penultimate paragraph of Exhibit A hereto. In giving such opinion such counsel
may rely, as to all matters governed by the laws of jurisdictions other than the
law of the State of New York, the federal law of the United States and the
General Corporation Law of the State of Delaware, upon the opinions of counsel
satisfactory to the U.S. Representatives. Such counsel may also state that,
insofar as such opinion involves factual matters, they have relied, to the
extent they deem proper, upon certificates of officers of the Company and its
subsidiaries and certificates of public officials.
(e) Officers' Certificate. At Closing Time, there shall not have been,
since the date hereof or since the respective dates as of which information is
given in the Prospectuses, any material adverse change in the condition,
financial or otherwise, or in the earnings, business affairs or business
prospects of the Company and its subsidiaries considered as one enterprise,
whether or not arising in the ordinary course of business, and the U.S.
Representatives shall have received a certificate of the President or a Vice
President of the Company and of the chief financial or chief accounting officer
-20-
of the Company, dated as of Closing Time, to the effect that (i) there has been
no such material adverse change, (ii) the representations and warranties in
Section 1(a) hereof are true and correct with the same force and effect as
though expressly made at and as of Closing Time, (iii) the Company has complied
with all agreements and satisfied all conditions on its part to be performed or
satisfied at or prior to Closing Time, and (iv) no stop order suspending the
effectiveness of the Registration Statement has been issued and no proceedings
for that purpose have been instituted or are pending or, to the Company's,
knowledge are contemplated by the Commission.
(f) Certificate of Selling Shareholders. At Closing Time, the U.S.
Representatives shall have received a certificate of each of the Shareholder
Representatives Attorney-in-Fact on behalf of the Selling Shareholders, dated as
of Closing Time, to the effect that (i) the representations and warranties of
each Selling Shareholder contained in Section 1(b) hereof are true and correct
in all respects with the same force and effect as though expressly made at and
as of Closing Time and (ii) each Selling Shareholder has complied in all
material respects with all agreements and all conditions on its part to be
performed under this Agreement at or prior to Closing Time.
(g) Accountant's Comfort Letter. At the time of the execution of this
Agreement, the U.S. Representatives shall have received from each of Ernst &
Young LLP and KPMG Audit Plc a letter dated such date, in form and substance
satisfactory to the U.S. Representatives, together with signed or reproduced
copies of such letters for each of the other U.S. Underwriters containing
statements and information of the type ordinarily included in accountants'
"comfort letters" to underwriters with respect to the financial statements and
certain financial information contained in the Registration Statement and the
Prospectuses.
(h) Bring-down Comfort Letter. At Closing Time, the Representatives shall
have received from each of Ernst & Young LLP and KPMG Audit Plc a letter, dated
as of Closing Time, to the effect that they reaffirm the statements made in the
letters furnished pursuant to subsection (e) of this Section, except that the
specified date referred to shall be a date not more than three business days
prior to Closing Time.
(i) Approval of Listing. At Closing Time, the Securities shall have been
approved for listing on the New York Stock Exchange, subject only to official
notice of issuance.
(j) Lock-up Agreements. At the date of this Agreement, the U.S.
Representatives shall have received an agreement substantially in the form of
Exhibit B hereto signed by the persons listed on Schedule D hereto.
(k) Purchase of Initial International Securities. Contemporaneously with
the purchase by the U.S. Underwriters of the Initial U.S. Securities under this
Agreement, the International Managers shall have purchased the Initial
International Securities under the International Purchase Agreement.
(l) Conditions to Purchase of U.S. Option Securities. In the event that
the U.S. Underwriters exercise their option provided in Section 2(b) hereof to
purchase all or any portion of
-21-
the U.S. Option Securities, the representations and warranties of the Company
contained herein and the statements in any certificates furnished by the Company
or any subsidiary of the Company hereunder shall be true and correct as of each
Date of Delivery and, at the relevant Date of Delivery, the U.S. Representatives
shall have received:
(i) Officers' Certificate. A certificate, dated such Date of
---------------------
Delivery, of the President or a Vice President of the Company and of
the chief financial or chief accounting officer of the Company
confirming that the certificate delivered at the Closing Time pursuant
to Section 5(d) hereof remains true and correct as of such Date of
Delivery.
(ii) Certificate of Selling Shareholders. A certificate, dated
-----------------------------------
such Date of Delivery, of the Shareholder Representatives on behalf of
each Selling Shareholder confirming that the certificate delivered at
Closing Time pursuant to Section 5(f) remains true and correct as of
such Date of Delivery.
(iii) Opinion of Counsel for Company. The favorable opinion of
------------------------------
each of ▇▇▇▇▇▇ ▇. ▇▇▇▇, ▇▇., Senior Vice President and General Counsel
of the Company, ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Associate General Counsel of the
Company, and ▇▇▇▇▇▇, Gottlieb, ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, counsel for the
Company, each in form and substance satisfactory to counsel for the
U.S. Underwriters, dated such Date of Delivery, relating to the U.S.
Option Securities to be purchased on such Date of Delivery and
otherwise to the same effect as the opinion required by Section 5(b)
hereof.
(iv) Opinion of Counsel for the Selling Shareholders. The
-----------------------------------------------
favorable opinion of ▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇, counsel for the Selling
Shareholders, in form and substance satisfactory to counsel for the
U.S. Underwriters, dated such Date of Delivery, relating to the Option
Securities to be purchased on such Date of Delivery and otherwise to
the same effect as the opinion required by Section 5(c) hereof.
(v) Opinion of Counsel for U.S. Underwriters. The favorable
----------------------------------------
opinion of each of ▇▇▇▇▇▇ & ▇▇▇▇▇▇, counsel for the U.S. Underwriters,
and ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇, Ltd., special counsel for the U.S.
Underwriters, dated such Date of Delivery, relating to the U.S. Option
Securities to be purchased on such Date of Delivery and otherwise to
the same effect as the opinion required by Section 5(c) hereof.
(vi) Bring-down Comfort Letter. A letter from ▇▇▇▇▇ & Young LLP
-------------------------
and from KPMG Audit plc, each, in form and substance satisfactory to
the U.S. Representatives and dated such Date of Delivery,
substantially in the same form and substance as the letter furnished
to the U.S. Representatives pursuant to Section 5(f) hereof, except
that the "specified date" in the letter furnished pursuant to this
paragraph shall be a date not more than five days prior to such Date
of Delivery.
-22-
(m) Additional Documents. At Closing Time and at each Date of Delivery,
counsel for the U.S. Underwriters shall have been furnished with such documents
and opinions as they may require for the purpose of enabling them to pass upon
the issuance and sale of the Securities as herein contemplated, or in order to
evidence the accuracy of any of the representations or warranties, or the
fulfillment of any of the conditions, herein contained; and all proceedings
taken by the Company in connection with the issuance and sale of the Securities
as herein contemplated shall be satisfactory in form and substance to the U.S.
Representatives and counsel for the U.S. Underwriters.
(n) Termination of Agreement. If any condition specified in this Section
shall not have been fulfilled when and as required to be fulfilled, this
Agreement, or, in the case of any condition to the purchase of U.S. Option
Securities on a Date of Delivery which is after the Closing Time, the
obligations of the several U.S. Underwriters to purchase the relevant Option
Securities, may be terminated by the U.S. Representatives by notice to the
Company and to the Selling Shareholders at any time at or prior to Closing Time
or such Date of Delivery, as the case may be, and such termination shall be
without liability of any party to any other party except as provided in Section
4 and except that Sections 1, 6, 7 and 8 shall survive any such termination and
remain in full force and effect.
SECTION 6. Indemnification.
---------------
(a) Indemnification of U.S. Underwriters. The Company agrees to indemnify
and hold harmless each U.S. Underwriter and each person, if any, who controls
any U.S. Underwriter within the meaning of Section 15 of the 1933 Act or Section
20 of the 1934 Act to the extent and in the manner set forth in clauses (i),
(ii) and (iii) below. In addition, each Selling Shareholder, severally and not
jointly, agrees to indemnify and hold harmless each Underwriter and each
person, if any, who controls any Underwriter within the meaning of Section 15 of
the 1933 Act or Section 20 of the 1934 Act as follows:
(i) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, arising out of any untrue statement or alleged
untrue statement of a material fact contained in the Registration Statement
(or any amendment thereto), including the Rule 430A Information and the
Rule 434 Information, if applicable, or the omission or alleged omission
therefrom of a material fact required to be stated therein or necessary to
make the statements therein not misleading or arising out of any untrue
statement or alleged untrue statement of a material fact included in any
preliminary prospectus or the Prospectuses (or any amendment or supplement
thereto), or the omission or alleged omission therefrom of a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading;
(ii) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, to the extent of the aggregate amount paid in
settlement of any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or of any claim
whatsoever based upon any such untrue statement or omission, or any such
-23-
alleged untrue statement or omission; provided that (subject to Section
6(d) below) any such settlement is effected with the written consent of the
Company; and
(iii) against any and all expense whatsoever, as incurred (including
the fees and disbursements of counsel chosen by ▇▇▇▇▇▇▇ ▇▇▇▇▇), reasonably
incurred in investigating, preparing or defending against any litigation,
or any investigation or proceeding by any governmental agency or body,
commenced or threatened, or any claim whatsoever based upon any such untrue
statement or omission, or any such alleged untrue statement or omission, to
the extent that any such expense is not paid under (i) or (ii) above;
provided, however, that this indemnity agreement shall not apply to any loss,
-------- -------
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Company by any
U.S. Underwriter through the U.S. Representatives expressly for use in the
Registration Statement (or any amendment thereto), including the Rule 430A
Information and the Rule 434 Information, if applicable, or any preliminary
prospectus or the U.S. Prospectus (or any amendment or supplement thereto); and
provided further that the Company will not be liable to an U.S. Underwriter with
-------- -------
respect to any preliminary prospectus to the extent that the Company shall
sustain the burden of proving that any such loss, liability, claim, damage or
expense resulted from the fact that such U.S. Underwriter failed to send or
give, at or prior to the Closing Date, a copy of the U.S. Prospectus, as then
amended or supplemented if: (i) the Company has previously furnished copies
thereof (sufficiently in advance of the Closing Date to allow for distribution
by the Closing Date) to the U.S. Underwriters and the loss, liability, claim,
damage or expense of such Underwriter resulted from an untrue statement or
omission of a material fact contained in or omitted from the preliminary
prospectus which was corrected in the U.S. Prospectus as, if applicable, amended
or supplemented prior to the Closing Date and such U.S. Prospectus was required
by law to be delivered at or prior to the written confirmation of sale to such
person and (ii) such failure to give or send such U.S. Prospectus by the Closing
Date to the party or parties asserting such loss, liability, claim, damage or
expense would have constituted the sole defense to the claim asserted by such
person; and provided further, that this indemnity agreement, in so far as it
-------- -------
relates to indemnification by Selling Shareholders, shall not apply to any loss,
liability, claim, damage or expense arising out of any untrue statement or
omission or alleged untrue statement or omission except to the extent such
untrue statement or omission or alleged untrue statement or omission relates (A)
to written information furnished to the Company by or on behalf of any Selling
Shareholder expressly for use in the Registration Statement (or any amendment
thereto) or any preliminary prospectus or U.S. Prospectus (or any amendment or
supplement thereto) or (B) to information relating to Fel-Pro.
(b) Indemnification of Company, Directors and Officers and Selling
Shareholders. Each U.S. Underwriter severally agrees to indemnify and hold
harmless the Company, its directors, each of its officers who signed the
Registration Statement, and each person, if any, who controls the Company within
the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act, and
each Selling Shareholder, against any and all loss, liability, claim, damage and
expense described in the indemnity contained in subsection (a) of this Section,
as incurred, but only with respect to untrue statements or omissions, or alleged
untrue statements or omissions, made in the Registration
-24-
Statement (or any amendment thereto), including the Rule 430A Information and
the Rule 434 Information, if applicable, or any preliminary U.S. prospectus or
the U.S. Prospectus (or any amendment or supplement thereto) in reliance upon
and in conformity with written information furnished to the Company by such U.S.
Underwriter through the U.S. Representatives expressly for use in the
Registration Statement (or any amendment thereto) or such preliminary prospectus
or the U.S. Prospectus (or any amendment or supplement thereto).
(c) Actions against Parties; Notification. Each indemnified party shall
give notice as promptly as reasonably practicable to each indemnifying party of
any action commenced against it in respect of which indemnity may be sought
hereunder, but failure to so notify an indemnifying party shall not relieve such
indemnifying party from any liability hereunder to the extent it is not
materially prejudiced as a result thereof and in any event shall not relieve it
from any liability which it may have otherwise than on account of this indemnity
agreement. In the case of parties indemnified pursuant to Section 6(a) above,
counsel to the indemnified parties shall be selected by ▇▇▇▇▇▇▇ ▇▇▇▇▇, and, in
the case of parties indemnified pursuant to Section 6(b) above, counsel to the
indemnified parties shall be selected by the Company. An indemnifying party may
participate at its own expense in the defense of any such action; provided,
however, that counsel to the indemnifying party shall not (except with the
consent of the indemnified party) also be counsel to the indemnified party. In
no event shall the indemnifying parties be liable for fees and expenses of more
than one counsel (in addition to any local counsel) separate from their own
counsel for all indemnified parties in connection with any one action or
separate but similar or related actions in the same jurisdiction arising out of
the same general allegations or circumstances. No indemnifying party shall,
without the prior written consent of the indemnified parties, settle or
compromise or consent to the entry of any judgment with respect to any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever in respect of which
indemnification or contribution could be sought under this Section 6 or Section
7 hereof (whether or not the indemnified parties are actual or potential parties
thereto), unless such settlement, compromise or consent (i) includes an
unconditional release of each indemnified party from all liability arising out
of such litigation, investigation, proceeding or claim and (ii) does not include
a statement as to or an admission of fault, culpability or a failure to act by
or on behalf of any indemnified party.
(d) Settlement without Consent if Failure to Reimburse. If at any time an
indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel, such indemnifying party
agrees that it shall be liable for any settlement of the nature contemplated by
Section 6(a)(ii) effected without its written consent if (i) such settlement is
entered into more than 45 days after receipt by such indemnifying party of the
aforesaid request, (ii) such indemnifying party shall have received notice of
the terms of such settlement at least 30 days prior to such settlement being
entered into and (iii) such indemnifying party shall not have reimbursed such
indemnified party in accordance with such request prior to the date of such
settlement.
(e) Limitation on Selling Shareholders' Indemnification. Without limiting
the full extent of (i) the Company's agreement to indemnify each U.S.
Underwriter (and controlling persons thereof, if any) as herein provided, (ii)
the liability of the Company with respect to the breach by the Company of any
representation, warranty or covenant contained in this Agreement (or in any
certificate of the
-25-
Company delivered pursuant hereto) and (iii) the liability for any Selling
Shareholder with respect to the breach by such Selling Shareholder of any
representation, warranty or covenant contained in Section 1 of this Agreement
(or in any certificate of such Selling Shareholder delivered pursuant hereto),
notwithstanding anything contained in this Agreement to the contrary, each
Selling Shareholder shall be liable under (A) the indemnification agreement
contained in Section 6(a) of this Agreement or (B) the contribution provisions
contained in Section 7 of this Agreement, only for an amount not exceeding, in
the aggregate, the net proceeds received by such Selling Shareholder from the
sale of Securities hereunder. The Company and the Selling Shareholders may
agree, as among themselves and without limiting the rights of the U.S.
Underwriters and controlling persons under this Agreement, as to the respective
amounts of such liability for which each of them shall be responsible.
SECTION 7. Contribution. If the indemnification provided for in
------------
Section 6 hereof is for any reason unavailable to or insufficient to hold
harmless an indemnified party in respect of any losses, liabilities, claims,
damages or expenses referred to therein, then each indemnifying party shall
contribute to the aggregate amount of such losses, liabilities, claims, damages
and expenses incurred by such indemnified party, as incurred, (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Company and the Selling Shareholders on the one hand and the U.S. Underwriters
on the other hand from the offering of the Securities pursuant to this Agreement
or (ii) if the allocation provided by clause (i) is not permitted by applicable
law, in such proportion as is appropriate to reflect not only the relative
benefits referred to in clause (i) above but also the relative fault of the
Company and the Selling Shareholders on the one hand and of the U.S.
Underwriters on the other hand in connection with the statements or omissions
which resulted in such losses, liabilities, claims, damages or expenses, as well
as any other relevant equitable considerations.
The relative benefits received by the Company and the Selling Shareholders
on the one hand and the U.S. Underwriters on the other hand in connection with
the offering of the U.S. Securities pursuant to this Agreement shall be deemed
to be in the same respective proportions as the total net proceeds from the
offering of the U.S. Securities pursuant to this Agreement (before deducting
expenses) received by the Company and the Selling Shareholders and the total
underwriting discount received by the U.S. Underwriters, in each case as set
forth on the cover of the U.S. Prospectus, or, if Rule 434 is used, the
corresponding location on the Term Sheet, bear to the aggregate initial public
offering price of the U.S. Securities as set forth on such cover.
The relative fault of the Company and the Selling Shareholders on the one
hand and the U.S. Underwriters on the other hand shall be determined by
reference to, among other things, whether any such untrue or alleged untrue
statement of a material fact or omission or alleged omission to state a material
fact relates to information supplied by the Company or the Selling Shareholders
or by the U.S. Underwriters and the parties' relative intent, knowledge, access
to information and opportunity to correct or prevent such statement or omission.
The Company, the Selling Shareholders and the U.S. Underwriters agree that
it would not be just and equitable if contribution pursuant to this Section 7
were determined by pro rata allocation (even if the U.S. Underwriters were
treated as one entity for such purpose) or by any other method of allocation
which does not take account of the equitable considerations referred to above in
this
-26-
Section 7. The aggregate amount of losses, liabilities, claims, damages and
expenses incurred by an indemnified party and referred to above in this Section
7 shall be deemed to include any legal or other expenses reasonably incurred by
such indemnified party in investigating, preparing or defending against any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever based upon any such
untrue or alleged untrue statement or omission or alleged omission.
Notwithstanding the provisions of this Section 7, no U.S. Underwriter shall
be required to contribute any amount in excess of the amount by which the total
price at which the U.S. Securities underwritten by it and distributed to the
public were offered to the public exceeds the amount of any damages which such
U.S. Underwriter has otherwise been required to pay by reason of any such untrue
or alleged untrue statement or omission or alleged omission.
No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the 1933 Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 7, each person, if any, who controls a U.S.
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act shall have the same rights to contribution as such U.S.
Underwriter, and each director of the Company, each officer of the Company who
signed the Registration Statement, and each person, if any, who controls the
Company within the meaning of Section 15 of the 1933 Act or Section 20 of the
1934 Act shall have the same rights to contribution as the Company. The U.S.
Underwriters' respective obligations to contribute pursuant to this Section 7
are several in proportion to the number of Initial U.S. Securities set forth
opposite their respective names in Schedule A hereto and not joint.
SECTION 8. Representations, Warranties and Agreements to Survive
-----------------------------------------------------
Delivery. All representations, warranties and agreements contained in this
--------
Agreement or in certificates of officers of the Company or any of its
subsidiaries or the Selling Shareholders submitted pursuant hereto, shall remain
operative and in full force and effect, regardless of any investigation made by
or on behalf of any U.S. Underwriter or controlling person, or by or on behalf
of the Company or the Selling Shareholders, and shall survive delivery of the
Securities to the U.S. Underwriters.
SECTION 9. Termination of Agreement.
------------------------
(a) Termination; General. The U.S. Representatives may terminate this
Agreement, by notice to the Company and the Selling Shareholders, at any time at
or prior to Closing Time (i) if there has been, since the time of execution of
this Agreement or since the respective dates as of which information is given in
the U.S. Prospectus, any material adverse change in the condition, financial or
otherwise, or in the earnings, business affairs or business prospects of the
Company and its subsidiaries considered as one enterprise, whether or not
arising in the ordinary course of business, or (ii) if there has occurred any
material adverse change in the financial markets in the United States or the
international financial markets, any outbreak of hostilities or escalation
thereof or other calamity or crisis or any change or development involving a
prospective change in national or
-27-
international political, financial or economic conditions, in each case the
effect of which is such as to make it, in the judgment of the U.S.
Representatives, impracticable to market the Securities or to enforce contracts
for the sale of the Securities, or (iii) if trading in any securities of the
Company has been suspended or materially limited by the Commission or the New
York Stock Exchange, or if trading generally on the New York Stock Exchange has
been suspended or materially limited, or minimum or maximum prices for trading
have been fixed, or maximum ranges for prices have been required, by any of said
exchanges or by such system or by order of the Commission, the National
Association of Securities Dealers, Inc. or any other governmental authority, or
(iv) if a banking moratorium has been declared by either Federal or New York
authorities.
(b) Liabilities. If this Agreement is terminated pursuant to this
Section, such termination shall be without liability of any party to any other
party except as provided in Section 4 hereof, and provided further that Sections
1, 6, 7 and 8 shall survive such termination and remain in full force and
effect.
SECTION 10. Default by One or More of the U.S. Underwriters. If one
-----------------------------------------------
or more of the U.S. Underwriters shall fail at Closing Time or a Date of
Delivery to purchase the Securities which it or they are obligated to purchase
under this Agreement (the "Defaulted Securities"), the U.S. Representatives
shall have the right, within 24 hours thereafter, to make arrangements for one
or more of the non-defaulting U.S. Underwriters, or any other underwriters, to
purchase all, but not less than all, of the Defaulted Securities in such amounts
as may be agreed upon and upon the terms herein set forth; if, however, the U.S.
Representatives shall not have completed such arrangements within such 24-hour
period, then:
(a) if the number of Defaulted Securities does not exceed 10% of the
number of U.S. Securities to be purchased on such date, each of the non-
defaulting U.S. Underwriters shall be obligated, severally and not jointly,
to purchase the full amount thereof in the proportions that their
respective underwriting obligations hereunder bear to the underwriting
obligations of all non-defaulting U.S. Underwriters, or
(b) if the number of Defaulted Securities exceeds 10% of the number of
U.S. Securities to be purchased on such date, this Agreement or, with
respect to any Date of Delivery which occurs after the Closing Time, the
obligation of the U.S. Underwriters to purchase and of the Company to sell
the Option Securities to be purchased and sold on such Date of Delivery
shall terminate without liability on the part of any non-defaulting U.S.
Underwriter.
No action taken pursuant to this Section shall relieve any defaulting U.S.
Underwriter from liability in respect of its default.
In the event of any such default which does not result in a termination of
this Agreement or, in the case of a Date of Delivery which is after the Closing
Time, which does not result in a termination of the obligation of the U.S.
Underwriters to purchase and the Company to sell the relevant U.S. Option
Securities, as the case may be, either the U.S. Representatives or the Company
-28-
shall have the right to postpone Closing Time or the relevant Date of Delivery,
as the case may be, for a period not exceeding seven days in order to effect any
required changes in the Registration Statement or Prospectus or in any other
documents or arrangements. As used herein, the term "U.S. Underwriter" includes
any person substituted for a U.S. Underwriter under this Section 10.
SECTION 11. Default by One or More of the Selling Shareholder(s) or
-------------------------------------------------------
the Company. (a) If a Selling Shareholder shall fail at Closing Time to sell and
-----------
deliver the number of Securities which such Selling Shareholder or Selling
Shareholders are obligated to sell hereunder, and the remaining Selling
Shareholder(s) do not exercise the right hereby granted to increase, pro rata or
otherwise, the number of Securities to be sold by them hereunder to the total
number to be sold by all Selling Shareholders as set forth in Schedule A-2
hereto, then the U.S. Underwriters may, at the option of the U.S.
Representatives, by notice from the U.S. Representatives to the Company and the
non-defaulting Selling Shareholder(s), either (a) terminate this Agreement
without any liability on the fault of any non-defaulting party except that the
provisions of Sections 1, 4, 6, 7 and 8 shall remain in full force and effect or
(b) elect to purchase the Securities which the non-defaulting Selling
Shareholder(s) and the Company have agreed to sell hereunder. No action taken
pursuant to this Section 11 shall relieve any Selling Shareholder so defaulting
from liability, if any, in respect of such default.
In the event of a default by any Selling Shareholder as referred to in this
Section 11, each of the U.S. Representatives, the Company and the non-defaulting
Selling Shareholder(s) shall have the right to postpone Closing Time or Date of
Delivery for a period not exceeding seven days in order to effect any required
change in the Registration Statement or Prospectus or in any other documents or
arrangements.
(b) If the Company shall fail at Closing Time to sell and deliver the
number of Securities that it is obligated to sell hereunder, then this Agreement
shall terminate without any liability on the part of any non-defaulting party
except that the provisions of Sections 1, 4, 6, 7 and 8 shall remain in full
force and effect. No action taken pursuant to this Section 11 shall relieve the
Company from liability, if any, in respect of such default.
SECTION 12. Notices. All notices and other communications hereunder
-------
shall be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the U.S.
Underwriters shall be directed to the U.S. Representatives at North Tower, World
Financial Center, New York, New York 10281-1201, attention of .; and notices to
the Company shall be directed to it at ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇, attention of General Counsel; and notices to the Selling
Shareholder(s) shall be directed to ., attention of ..
SECTION 13. Parties. This Agreement shall each inure to the benefit of
-------
and be binding upon the U.S. Underwriters, the Company and the Selling
Shareholders and their respective successors. Nothing expressed or mentioned in
this Agreement is intended or shall be construed to give any person, firm or
corporation, other than the U.S. Underwriters, the Company and the Selling
Shareholders and their respective successors and the controlling persons and
officers and directors
-29-
referred to in Sections 6 and 7 and their heirs and legal representatives, any
legal or equitable right, remedy or claim under or in respect of this Agreement
or any provision herein contained. This Agreement and all conditions and
provisions hereof are intended to be for the sole and exclusive benefit of the
U.S. Underwriters, the Company and the Selling Shareholders and their respective
successors, and said controlling persons and officers and directors and their
heirs and legal representatives, and for the benefit of no other person, firm or
corporation. No purchaser of Securities from any U.S. Underwriter shall be
deemed to be a successor by reason merely of such purchase.
SECTION 14. GOVERNING LAW AND TIME. THIS AGREEMENT SHALL BE GOVERNED BY
----------------------
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. SPECIFIED
TIMES OF DAY REFER TO NEW YORK CITY TIME.
SECTION 15. Effect of Headings. The Article and Section headings herein
------------------
and the Table of Contents are for convenience only and shall not affect the
construction hereof.
-30-
If the foregoing is in accordance with your understanding of our agreement,
please sign and return to the Company and the Shareholder Representatives for
the Selling Shareholders a counterpart hereof, whereupon this instrument, along
with all counterparts, will become a binding agreement between the U.S.
Underwriters and the Company and the Selling Shareholders in accordance with its
terms.
Very truly yours,
FEDERAL-MOGUL CORPORATION
By _________________________________
Name:
Title:
[Selling Shareholders]
By:________________________________________
[Name]
As Shareholder Representative acting on behalf of
the Selling Shareholders listed above
[Selling Shareholders]
By:________________________________________
[Name]
As Shareholder Representative acting on behalf of
the Selling Shareholders listed above
[Selling Shareholders]
By:________________________________________
[Name]
As Shareholder Representative acting on behalf of
the Selling Shareholders listed above
-31-
CONFIRMED AND ACCEPTED,
as of the date first above written:
▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO.
▇▇▇▇▇▇▇ LYNCH, ▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇
INCORPORATED
BEAR, ▇▇▇▇▇▇▇ & CO., INC.
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
SECURITIES CORPORATION
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & CO., INC.
▇▇▇▇▇ ▇▇▇▇▇▇ INC.
▇▇▇▇▇▇▇▇ & CO. INC.
By: ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇
INCORPORATED
By _________________________________
Authorized Signatory
For themselves and as U.S. Representatives of the
other U.S. Underwriters named in Schedule A hereto.
SCHEDULE A
Name of U.S. Underwriter Number of
------------------------
Initial U.S.
Securities
------------
▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated......................................
▇▇▇▇, ▇▇▇▇▇▇▇ & Co., Inc..................................
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
Securities Corporation............................
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co., Inc.................................
▇▇▇▇▇ ▇▇▇▇▇▇ Inc..........................................
▇▇▇▇▇▇▇▇ & Co. Inc........................................
------------
Total.....................................................
============
Sch A-1
SCHEDULE A-2
Number of Initial U.S. Maximum Number of U.S.
Securities to be Sold Option Securities to be Sold
---------------------- ----------------------------
Federal-Mogul Corporation
[Selling Shareholders] --------- ---------
Total..................... =============== ===============
Sch A-2
SCHEDULE B
FEDERAL-MOGUL CORPORATION
____________ Shares of Common Stock
(Without Par Value)
1. The initial public offering price per share for the Securities,
determined as provided in said Section 2, shall be $..
2. The purchase price per share for the U.S. Securities to be paid by the
several U.S. Underwriters shall be $., being an amount equal to the initial
public offering price set forth above less $. per share; provided that the
purchase price per share for any U.S. Option Securities purchased upon the
exercise of the over-allotment option described in Section 2(b) shall be reduced
by an amount per share equal to any dividends or distributions declared by the
Company and payable on the Initial U.S. Securities but not payable on the U.S.
Option Securities.
Sch B-1
SCHEDULE C
[List of subsidiaries to come.]
Sch C-1
[SCHEDULE D]
[List of persons and entities
subject to lock-up]
Federal-Mogul Corporation
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇
Sch D-1
Exhibit A
FORM OF OPINION OF COMPANY'S COUNSEL
TO BE DELIVERED PURSUANT TO
SECTION 5(b)
[To be agreed]
A-1
Exhibit A-2
FORM OF OPINION OF COUNSEL FOR THE SELLING SHAREHOLDER(S)
TO BE DELIVERED PURSUANT TO SECTION 5(c)
i. No filing with, or authorization, approval, consent,
license, order, registration, qualification or decree of, any
court or governmental authority or agency, domestic or foreign
(other than under the 1933 Act and the 1933 Act Regulations,
which have been obtained, or as may be required under the
securities or blue sky laws of the various states, as to which
we need express no opinion) is necessary or required to be
obtained by the Selling Shareholders for the performance by
the Selling Shareholders of their obligations under the U.S.
Purchase Agreement, the International Purchase Agreement or
the Power of Attorney and Custody Argeement, or in connection
with the offer, sale and delivery of the Securities.
ii. Each Power of Attorney and Custody Agreement has been
duly executed and delivered by the respective Selling
Shareholder(s) named therein and constitutes the legal, valid
and binding agreement of such Selling Shareholder.
iii. Each of the U.S. Purchase Agreement and the International
Purchase Agreement has been duly authorized, executed and
delivered by or on behalf of each Selling Shareholder.
iv. The Shareholder Representatives have been duly authorized
by the Selling Shareholders to deliver shares of Series E
Preferred Stock for conversion into Conversion Shares and
direct the Company to deliver the Conversion Shares on behalf
of the Selling Shareholders in accordance with the terms of
the U.S. Purchase Agreement and the International Purchase
Agreement.
v. The execution, delivery and performance of the U.S.
Purchase Agreement, the International Purchase Agreement and
the Power of Attorney and Custody Agreement and the sale and
delivery of the Securities and the consummation of the
transactions contemplated in the U.S. Purchase Agreement, the
International Purchase Agreement and in the Registration
Statement and compliance by the Selling Shareholder(s) with
its obligations under the U.S. Purchase Agreement and the
International Purchase Agreement have been duly authorized by
all necessary action on the part of the Selling Shareholder(s)
and do not and will not, whether with or without
A-2
the giving of notice or passage of time or both, conflict with
or constitute a breach of, or default under or result in the
creation or imposition of any tax, lien, charge or encumbrance
upon the Securities nor will such action result in any
violation of the provisions of the charter or by-laws or other
organizational or governing instrucments of the Selling
Shareholders, if applicable, or any law, administrative
regulation, judgment or order of any government, government
instrumentality or court or any administrative or court decree
having jurisdiction over such Selling Shareholder or any of its
properties.
vi. To the best of our knowledge, each Selling Shareholder has
valid and marketable title to the shares of Series E Stock to
be converted into Conversion Shares to be sold by such Selling
Shareholder pursuant to the U.S. Purchase Agreement and the
International Purchase Agreement, free and clear of any pledge,
lien, security interest, claim, equity or encumbrance of any
kind, and has full right, power and authority to sell, transfer
and deliver such Securities pursuant to the U.S. Purchase
Agreement and the International Purchase Agreement. By delivery
of a certificate or certificates therefor such Selling
Shareholder will transfer to the Underwriters who have
purchased such Securities pursuant to the U.S. Purchase
Agreement and the International Purchase Agreement (without
notice of any defect in the title of such Selling Shareholder
and who are otherwise bona fide purchasers for purposes of the
Uniform Commercial Code) valid and marketable title to such
Securities, free and clear of any pledge, lien, security
interest, charge, claim, equity or encumbrance of any kind.
A-3
[FORM OF LOCK-UP FROM DIRECTORS, OFFICERS OR OTHER STOCKHOLDERS PURSUANT TO
SECTION 5(J)]
Exhibit B
., 1998
▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO.
▇▇▇▇▇▇▇ Lynch, ▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated,
Bear, ▇▇▇▇▇▇▇ & Co., Inc.
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
Securities Corporation
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co., Inc.
▇▇▇▇▇ ▇▇▇▇▇▇ Inc.
▇▇▇▇▇▇▇▇ & Co. Inc.
as U.S. Representatives of the several
U.S. Underwriters to be named in the
within-mentioned U.S. Purchase Agreement
c/▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co.
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
North Tower
World Financial Center
New York, New York 10281-1209
Re: Proposed Public Offering by Federal-Mogul Corporation
-----------------------------------------------------
Dear Sirs:
The undersigned, a stockholder and an officer and/or director of Federal-
Mogul Corporation, a Michigan corporation (the "Company"), understands that
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated
("▇▇▇▇▇▇▇ ▇▇▇▇▇") and Bear, ▇▇▇▇▇▇▇ & Co., Inc., ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
Securities Corporation, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co., Inc., ▇▇▇▇▇ ▇▇▇▇▇▇ Inc. and
▇▇▇▇▇▇▇▇ & Co. Inc. proposes to enter into a U.S. Purchase Agreement (the "U.S.
Purchase Agreement") with the Company providing for the public offering of
shares (the "Securities") of the Company's common stock, without par value (the
"Common Stock"). In recognition of the benefit that such an offering will
confer upon the undersigned as a stockholder and an officer and/or director of
the Company, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the undersigned agrees with each
underwriter to be named in the U.S. Purchase Agreement that, during a period of
. days from the date of the U.S. Purchase Agreement, the undersigned will not,
without the prior written consent of ▇▇▇▇▇▇▇ ▇▇▇▇▇, directly or indirectly, (i)
offer, pledge, sell, contract to sell, sell any option or contract to purchase,
purchase any option or contract to sell, grant any option, right or warrant for
the sale of, or otherwise dispose of or transfer any shares of the Company's
Common Stock or any securities convertible into or exchangeable or
B-1
exercisable for Common Stock, whether now owned or hereafter acquired by the
undersigned or with respect to which the undersigned has or hereafter acquires
the power of disposition, or file any registration statement under the
Securities Act of 1933, as amended, with respect to any of the foregoing or (ii)
enter into any swap or any other agreement or any transaction that transfers, in
whole or in part, directly or indirectly, the economic consequences of ownership
of the Common Stock, whether any such swap or transaction is to be settled by
delivery of Common Stock or other securities, in cash or otherwise.
Very truly yours,
Signature:___________________________
Name:________________________________
