4,000,000 Shares
Great Dane Holdings Inc.
Common Stock
($.01 Par Value)
UNDERWRITING AGREEMENT
April ____, 1995
Alex. Brown & Sons Incorporated
Smith Barney Inc.
As Representatives of the Several Underwriters
c/o Alex. Brown & Sons Incorporated
135 East Baltimore Street
Baltimore, Maryland 21202
Ladies and Gentlemen:
Great Dane Holdings Inc., a Delaware corporation (the "Company" or the
"Issuer"), proposes to sell to the several underwriters (the "Underwriters")
named in Schedule 1 hereto for whom you are acting as representatives (the
"Representatives") an aggregate of 4,000,000 shares of the Common Stock, par
value $.01 per share (the "Firm Shares"), of the Company. The respective
amounts of the Firm Shares to be so purchased by the several Underwriters are
set forth opposite their names in Schedule I hereto. The Company also proposes
to sell at the Underwriters' option an aggregate of up to 600,000 additional
shares of the Company's Common Stock (the "Option Shares") as set forth below.
As the Representatives, you have advised the Company (a) that you are
authorized to enter into this Agreement on behalf of the several Underwriters,
and (b) that the several Underwriters are willing, acting severally and not
jointly, to purchase the numbers of Firm Shares set forth opposite their
respective names in Schedule I, plus their pro rata portion of the Option Shares
if you elect to exercise the over-allotment option in whole or in part for the
accounts of the several Underwriters. The Firm Shares and the Option Shares (to
the extent the aforementioned option is exercised) are herein collectively
called the "Shares."
In consideration of the mutual agreements contained herein and of the
interests of the parties in the transactions contemplated hereby, the parties
hereto agree as follows:
1. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
The Company represents and warrants as follows:
(i) A registration statement on Form S-1 (File No. 33-56595)
with respect to the Shares has been prepared by the Company in
conformity with the requirements of the Securities Act of 1933, as
amended (the "Act"), and the Rules and Regulations (the "Rules and
Regulations") of the Securities and Exchange Commission (the
"Commission") thereunder and has been filed with the Commission under
the Act. Copies of such registration statement, including any
amendments thereto, the preliminary prospectuses (meeting the
requirements of Rule 430A of the Rules and Regulations) contained
therein and the exhibits, financial statements and schedules, as
finally amended and revised, have heretofore been delivered by the
Company to you. Such registration statement (including any amendments
thereto), herein referred to as the "Registration Statement," which
shall be deemed to include all information omitted therefrom in
reliance upon Rule 430A and contained in the Prospectus referred to
below, has been declared effective by the Commission under the Act and
no post-effective amendment to the Registration Statement has been
filed as of the date of this Agreement. The form of prospectus first
filed by the Company with the Commission pursuant to its Rule 424(b)
and Rule 430A is herein referred to as the "Prospectus." Each
preliminary prospectus included in the Registration Statement prior to
the time it becomes effective is herein referred to as a "Preliminary
Prospectus." Any reference herein to the Prospectus shall be deemed
to include any supplements or amendments thereto filed with the
Commission after the date of filing of the Prospectus under
Rules 424(b) and 430A, and prior to the termination of the offering of
the Shares by the Underwriters.
(ii) The Company has been duly incorporated, is validly existing
as a corporation in good standing under the laws of the State of
Delaware and has the corporate power and authority to carry on its
business as described in the Prospectus and to own, lease and operate
its properties; the Company is duly qualified and in good standing as
a foreign corporation authorized to do business in each jurisdiction
in which the nature of its business or its ownership or leasing of
property requires such qualification, except where the failure to be
so qualified (singly or in the aggregate) would not have a material
adverse effect on the condition (financial or otherwise), earnings or
business affairs of the Company and its Subsidiaries, considered as
one enterprise.
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(iii) Each corporation listed on Schedule I, at least 50% of whose
securities having ordinary voting power (other than securities having
such voting power only by reason of the happening of a contingency)
are directly or indirectly owned by the Company, and each partnership
or joint venture (a "partnership") at least 50% of the equity
ownership of which is directly or indirectly owned by the Company, or
of which the Company directly or indirectly controls the controlling
general partner, whether in the form of a general, special or limited
partnership (each such corporation, or other entity, a "Subsidiary"),
has been duly incorporated or in the case of a partnership organized
and is validly existing as a corporation in good standing under the
laws of its jurisdiction of organization, with the corporate power and
authority to own, lease and operate its properties and conduct its
business as described in the Prospectus and each is duly qualified to
do business as a foreign corporation in good standing in each
jurisdiction in which such qualification is required, whether by
reason of the ownership or leasing of property or conduct of business,
except where the failure to be so qualified or be in good standing
(singly or in the aggregate) would not have a material adverse effect
on the condition (financial or otherwise), earnings or business
affairs of the Company and its Subsidiaries, considered as one
enterprise.
(iv) Each of the Company and International Controls Corp.
("ICC"), a Florida Corporation, had all requisite power and authority
to execute, deliver and perform its obligations under the Agreement
and Plan of Merger of International Controls Corp. into Great Dane
Holdings Inc., (the "Merger Agreement"); the Merger Agreement was duly
and validly authorized, executed and delivered by each of the Company
and ICC and constituted a valid and binding obligation of each of the
Company and ICC and was consummated in accordance with the terms of
the Merger Agreement under Delaware and Florida law.
(v) The outstanding shares of Common Stock of the Company have
been duly authorized and validly issued and are fully paid and non-
assessable; the Shares to be issued and sold by the Company have been
duly authorized and when issued and paid for as contemplated herein
will be validly issued, fully paid and non-assessable; and no
preemptive rights of stockholders exist with respect to any of the
Shares or the issue and sale thereof.
(vi) The Shares conform with the statements concerning them in
the Registration Statement.
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(vii) All of the issued and outstanding shares of capital stock of
each of the Company's corporate Subsidiaries have been duly authorized
and are fully paid and non-assessable and all such shares and each of
the equity interests in the Company's partnership Subsidiaries are
validly issued and, except for a 10% equity interest of South
Charleston Stamping & Manufacturing Company, as described in the
Prospectus and directors' qualifying shares of American Country
Insurance Company, are owned by the Company directly or through one or
more Subsidiaries of the Company, free and clear of any security
interest, charge, claim, lien, encumbrance or adverse interest of any
nature, except that (A) the capital stock of Great Dane Trailers
Tennessee, Inc. and Great Dane Los Angeles, Inc. is pledged pursuant
to that certain Amended and Restated Loan and Security Agreement dated
as of February 14, 1995 by and among Great Dane Trailers, Inc. ("Great
Dane"), Great Dane Trailers Tennessee, Inc., Great Dane Los Angeles,
Inc., the financial institutions named therein and BankAmerica
Business Credit, Inc., as Agent (the "BankAmerica Loan"), (B) the
capital stock of Yellow Cab Company, CMC Kalamazoo Inc., Chicago
AutoWerks Inc. and South Charleston Stamping & Manufacturing Company
owned by the Company has been pledged pursuant to that certain Loan
Agreement dated as of January 26, 1995 among those entities, Checker
Motors Corporation, NBD Bank, The Bank of New York Commercial
Corporation, The First National Bank of Boston and NBD Bank, as Agent
(the "NBD Loan"), and (C) the Company has agreed, in connection with
the BankAmerica Loan not to sell, assign, transfer, convey or
otherwise dispose of or grant any option with respect to the stock of
Great Dane, and no options, warrants or other rights to purchase,
agreements or other obligations to issue or other rights to convert
any obligations into shares of capital stock or ownership interests in
the Subsidiaries are outstanding.
(viii) The Commission has not issued an order preventing or
suspending the use of any Preliminary Prospectus relating to the
proposed offering of the Shares nor instituted proceedings for that
purpose. The Registration Statement contains and the Prospectus will
contain all statements which are required to be stated therein by, and
in all material respects conform or will conform, as the case may be,
to the requirements of, the Act and the Rules and Regulations.
Neither the Registration Statement, any amendment thereto, nor the
Prospectus contains or will contain, as the case may be, any untrue
statement of a material fact or omits or will omit to state any
material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances
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under which they were made, not misleading; provided, however, that
the Company makes no representations or warranties as to information
contained in or omitted from the Registration Statement or the
Prospectus, in reliance upon, and in conformity with, written
information furnished to the Company by or on behalf of any
Underwriter through the Representatives, specifically for use in the
preparation thereof.
(ix) The consolidated financial statements of the Company and the
Subsidiaries, together with related notes and schedules as set forth
in the Registration Statement and the Prospectus, present fairly the
financial position and the results of operations of the Company and
Subsidiaries consolidated, at the indicated dates and for the
indicated periods. Such financial statements have been prepared in
accordance with United States generally accepted principles of
accounting, consistently applied throughout the periods involved,
except as disclosed therein and all adjustments necessary for a fair
presentation of results for such period have been made. The summary
financial and statistical data included in the Registration Statement
presents fairly the information shown therein and have been compiled
on a basis consistent with the financial statements presented therein
and the other financial and statistical information and data set forth
in the Registration Statement and the Prospectus is, in all material
respects, accurately presented and prepared on a basis consistent with
such financial statements and the books and records of the Company.
The other financial information included in the Prospectus presents
fairly the information shown therein, has been prepared in accordance
with the Rules and Regulations with respect thereto, and, in the
opinion of the Issuer, the assumptions used in the preparation thereof
are reasonable and the adjustments used therein are appropriate to
give effect to the transactions or circumstances referred to therein.
(x) There is no legal or governmental action or proceeding
pending or, to the knowledge of the Company, threatened against the
Company or any of the Subsidiaries, or of which any of their
respective assets or property is the subject, before any court or
administrative agency which might result (singly or in the aggregate)
in any material adverse change in the condition (financial or
otherwise), earnings or business affairs of the Company and its
Subsidiaries, considered as one enterprise, except as set forth in the
Registration Statement. No contract or document of a character
required to be described in the Registration Statement or the
Prospectus or to be filed as an exhibit to the Registration Statement
is not so described or filed as required.
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(xi) The Company and the Subsidiaries have good and marketable
title to all of the properties and assets reflected in the financial
statements (or as described in the Registration Statement as being
owned by the Company, its Subsidiaries or by any of the Company's
predecessors) hereinabove described, subject to no lien, mortgage,
pledge, charge or encumbrance of any kind except as set forth in the
Prospectus, other than (i) liens for taxes not yet due and payable and
(ii) other liens not material to the condition (financial or
otherwise), earnings or business affairs of the Company and its
Subsidiaries, considered as one enterprise. The Company and the
Subsidiaries occupy their leased properties under valid and binding
leases and no default has occurred or is continuing thereunder, except
for defaults that will not result (singly or in the aggregate) in any
material adverse change in the condition (financial or otherwise),
earnings or business affairs of the Company and its Subsidiaries,
considered as one enterprise, and the Company and its Subsidiaries
enjoy peaceful and undisturbed possession under all such leases to
which any of them is a party as lessee or an assignee of a lessee with
such exceptions as do not materially interfere with the use made of
such leased property by the Company or its Subsidiaries, as the case
may be.
(xii) The Company and the Subsidiaries have filed all Federal,
State and foreign income tax returns which have been required to be
filed and have paid all taxes indicated by said returns to be due and
all assessments received by them or any of them to the extent that
such taxes have become due and are not being contested in good faith
(with proper reserves in accordance with generally accepted accounting
principles for any such taxes being so contested).
(xiii) Since the respective dates as of which information is given
in the Registration Statement, there has not been (either singly or in
the aggregate) any material adverse change or any development
involving a prospective material adverse change in the condition
(financial or otherwise), earnings or business affairs of the Company
and its Subsidiaries, considered as one enterprise, whether or not
occurring in the ordinary course of business, and there has not been
any material transaction entered into by the Company or the
Subsidiaries, other than transactions in the ordinary course of
business and changes and transactions contemplated by the Registration
Statement, and there has been no dividend or distribution of any kind
declared, paid or made by the Company on the Common Stock. The
Company and the Subsidiaries have no material contingent obligations
which are not disclosed in the Registration Statement, as it may be
amended or supplemented.
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(xiv) Neither the Company nor any of the Subsidiaries is in
default under any agreement, lease, contract, indenture or other
instrument or obligation to which it is a party or by which it or any
of its properties is bound and which default is of material
significance in respect of the condition (financial or otherwise),
earnings or business affairs of the Company and its Subsidiaries,
considered as one enterprise. The consummation of the transactions
herein contemplated and the fulfillment of the terms hereof will not
conflict with or result in a breach of any of the terms or provisions
of, or constitute a default under, any indenture, mortgage, deed of
trust or other agreement or instrument to which the Company or any
Subsidiary is a party, or of the charter or by-laws of the Company or
any order, rule or regulation applicable to the Company or any
Subsidiary of any court or of any regulatory body or administrative
agency or other governmental body having jurisdiction.
(xv) Each approval, consent, order, authorization, designation,
declaration or filing by or with any regulatory, administrative or
other governmental body necessary in connection with the execution and
delivery by the Company of this Agreement and the consummation of the
transactions herein contemplated (except such additional steps as may
be required by the National Association of Securities Dealers, Inc.
(the "NASD") or may be necessary to qualify the Shares for public
offering by the Underwriters under State securities or Blue Sky laws)
has been obtained or made and is in full force and effect.
(xvi) The Company and each of its Subsidiaries have such permits,
licenses, franchises, trademarks and authorizations of governmental or
regulatory authorities ("Permits") as are necessary to own, lease and
operate their respective properties and to conduct their respective
businesses in the manner described in the Prospectus; the Company and
each of its Subsidiaries have fulfilled and performed all of their
material obligations with respect to Permits and no event has occurred
which allows, or after notice or lapse of time would allow, revocation
or termination thereof or result in any other material impairment of
the rights of the holder of any Permit, except for any such
impairments which would not (singly or in the aggregate) have a
materially adverse effect on the condition (financial or otherwise),
earnings or business affairs of the Company and its Subsidiaries,
considered as one enterprise; and, except as described in the
Prospectus, the Permits contain no restrictions that are materially
burdensome to the Company or any of its Subsidiaries, considered as
one enterprise; and neither the Company nor any of the Subsidiaries
has infringed any patents, patent rights, trade names, trademarks or
copyrights,
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which infringement is material to the condition (financial or
otherwise), earnings or business affairs of the Company and the
Subsidiaries, considered as one enterprise.
(xvii) Ernst & Young LLP, who have certified certain of the
financial statements filed with the Commission as part of the
Registration Statement, are independent public accountants with
respect to the Issuer as required by the Act and the Rules and
Regulations.
(xviii) This Agreement has been duly authorized, executed and
delivered by the Issuer and constitutes a valid and binding obligation
of the Issuer, enforceable in accordance with its terms, except as
(i) the enforceability hereof may be limited by bankruptcy, insolvency
or similar laws affecting creditors' rights generally; (ii) the
availability of equitable remedies may be limited by equitable
principles of general applicability; and (iii) rights to indemnity and
contribution hereunder may be limited by applicable law.
(xix) The Escrow Deposit Agreement between Great Dane Holdings,
Inc. and First Fidelity Bank, National Association as Escrow Agent
(the "Escrow Agreement") has been duly authorized and, when executed
and delivered by the Issuer and the Escrow Agent, will constitute a
valid and binding obligation of the Issuer enforceable against the
Issuer in accordance with its terms, except as (i) the enforceability
hereof may be limited by bankruptcy, insolvency or similar laws
affecting creditors' rights generally and (ii) the availability of
equitable remedies may be limited by equitable principles of general
applicability.
(xx) Neither the Company nor any of its Subsidiaries has violated
any foreign, federal, state or local law or regulation relating to the
protection of human health and safety, the environment or hazardous or
toxic substances or wastes, pollutants or contaminants, nor any
federal or state law relating to discrimination in the hiring,
promotion or pay of employees nor any applicable federal or state
wages and hours laws, nor any provisions of the Employee Retirement
Income Security Act or the rules and regulations promulgated
thereunder except where any such violations would not (singly or in
the aggregate) have a material adverse effect on the condition
(financial or otherwise), earnings or business affairs of the Company
and its Subsidiaries, considered as one enterprise.
(xxi) The Company and its Subsidiaries have in effect with
insurers of recognized financial responsibility insurance against such
losses and
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risks and in amounts the Company reasonably believes are adequate in
light of the business conducted by the Company and its Subsidiaries
and the properties owned by them.
(xxii) Each of the Company and its Subsidiaries owns or possesses,
or can acquire on reasonable terms, adequate patents, patent rights,
licenses, inventions, copyrights, know-how (including trade secrets
and other patented and/or unpatented proprietary or confidential
information, systems or procedures), trademarks, service marks and
trade names (collectively, "Intellectual Property") presently employed
by them in connection with the business now operated by them, except
where the failure to own or possess or have the ability to acquire any
such Intellectual Property would not (singly or in the aggregate) have
a material adverse effect on the condition (financial or otherwise),
earnings or business affairs of the Company and its Subsidiaries,
considered as one enterprise, and neither the Company nor any of its
Subsidiaries has received any notice of infringement of or conflict
with asserted rights of others with respect to any of the foregoing
that, (singly or in the aggregate), if the subject of an unfavorable
decision, ruling or finding, would result in any material adverse
change in the condition (financial or otherwise), earnings or business
affairs of the Company and its Subsidiaries, considered as one
enterprise.
(xxiii) No labor disturbance, strike or slowdown exists with the
employees of the Company or any of its Subsidiaries or to its
knowledge is imminent, which (singly or in the aggregate), has or
would have a material adverse effect on the condition (financial or
otherwise), earnings or business affairs of the Company and its
Subsidiaries, considered as one enterprise.
(xxiv) The Company and its Subsidiaries each maintain a system of
internal accounting controls sufficient to provide reasonable
assurances that (i) transactions are executed in accordance with
management's general or specific authorization; (ii) transactions are
recorded as necessary to permit preparation of financial statements in
conformity with United States generally accepted accounting principles
and to maintain accountability for assets; (iii) access to assets is
permitted only in accordance with management's general or specific
authorization; and (iv) the recorded accountability for assets is
compared with the existing assets at reasonable intervals and
appropriate action is taken with respect to any difference.
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(xxv) The Issuer is not an "investment company" or a company
"controlled" by an "investment company" within the meaning of the
Investment Company Act of 1940, as amended.
(xxvi) No holder of any security of the Issuer has any right to
have any Common Stock or other securities of the Issuer included in
the Registration Statement or any right, as a result of the filing of
the Registration Statement, to require registration of any Common
Stock or any other security of the Issuer under the Act.
(xxvii) There are no business relationships or related-party
transactions of the nature described in Item 404 of Regulation S-K
involving the Company or any of its Subsidiaries and any person
described in such Item that are required to be disclosed in the
Prospectus and which have not been so disclosed.
2. PURCHASE, SALE AND DELIVERY OF THE FIRM SHARES. On the basis of
the representations, warranties and covenants herein contained, and subject to
the conditions herein set forth, the Company agrees to sell to the Underwriters,
and each Underwriter agrees, severally and not jointly, to purchase, at a price
of $____ per share, the number of Firm Shares set forth opposite the name of
each Underwriter in Schedule I hereof, subject to adjustments in accordance with
Section 9 hereof.
Payment for the Firm Shares to be sold hereunder is to be made in New
York Clearing House funds by certified or bank cashier's checks drawn to the
order of the Company against delivery of certificates therefor to the
Representatives for the several accounts of the Underwriters. Such payment and
delivery are to be made at the offices of Alex. Brown & Sons Incorporated, 135
East Baltimore Street, Baltimore, Maryland, at 10:00 a.m. Baltimore time, on the
fifth business day after the date of this Agreement or at such other time and
date not later than five business days thereafter as you and the Company shall
agree upon, such time and date being herein are referred to as the "Closing
Date." (As used herein, "business day" means a day on which the New York Stock
Exchange is open for trading and on which banks in New York are open for
business and not permitted by law or executive order to be closed.) The
certificates for the Firm Shares will be delivered in such denominations and in
such registrations as the Representatives request in writing not later than the
third full business day prior to the Closing Date, and will be made available
for inspection by the Representatives at least one business day prior to the
Closing Date.
In addition, on the basis of the representations and warranties herein
contained and subject to the terms and conditions herein set forth, the Company
hereby grants an option to the several Underwriters to purchase the Option
Shares at the price per
10
share as set forth in the first paragraph of this Section 2. The option granted
hereby may be exercised in whole or in part but only once and at any time upon
written notice given within 30 days after the date of this Agreement, by you, as
Representatives of the several Underwriters, to the Company setting forth the
number of Option Shares as to which the several Underwriters are exercising the
option, the names and denominations in which the Option Shares are to be
registered and the time and date at which such certificates are to be delivered.
The time and date at which certificates for Option Shares are to be delivered
shall be determined by the Representatives but shall not be earlier than three
nor later than 10 full business days after the exercise of such option, nor in
any event prior to the Closing Date (such time and date being herein referred to
as the "Option Closing Date"). If the date of exercise of the option is three
or more days before the Closing Date, the notice of exercise shall set the
Closing Date as the Option Closing Date. The number of Option Shares to be
purchased by each Underwriter shall be in the same proportion to the total
number of Option Shares being purchased as the number of Firm Shares being
purchased by such Underwriter bears to 4,000,000, adjusted by you in such manner
as to avoid fractional shares. The option with respect to the Option Shares
granted hereunder may be exercised only to cover over-allotments in the sale of
the Firm Shares by the Underwriters. You, as Representatives of the several
Underwriters, may cancel such option at any time prior to its expiration by
giving written notice of such cancellation to the Company. To the extent, if
any, that the option is exercised, payment for the Option Shares shall be made
on the Option Closing Date in New York Clearing House funds by certified or bank
cashier's check drawn to the order of the Company against delivery of
certificates therefor at the offices of Alex. Brown & Sons Incorporated, 135
East Baltimore Street, Baltimore, Maryland.
3. OFFERING BY THE UNDERWRITERS. It is understood that the several
Underwriters are to make a public offering of the Firm Shares as soon as the
Representatives deem it advisable to do so. The Firm Shares are to be initially
offered to the public at the initial public offering price set forth in the
Prospectus. The Representatives may from time to time thereafter change the
public offering price and other selling terms. To the extent, if at all, that
any Option Shares are purchased pursuant to Section 2 hereof, the Underwriters
will offer them to the public on the foregoing terms.
It is further understood that you will act as the Representatives for
the Underwriters in the offering and sale of the Shares in accordance with a
Master Agreement Among Underwriters entered into by you and the several other
Underwriters.
4. COVENANTS OF THE COMPANY.
The Company covenants and agrees with the several Underwriters that:
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(i) The Company will (i) prepare and timely file with the
Commission under Rule 424(b) of the Rules and Regulations, a
Prospectus containing information previously omitted at the time of
effectiveness of the Registration Statement in reliance on Rule 430A
of the Rules and Regulations, (ii) not file any amendment to the
Registration Statement or supplement to the Prospectus of which the
Representatives shall not previously have been advised and furnished
with a copy or to which the Representatives shall have reasonably
objected in writing or which is not in compliance with the Rules and
Regulations and (iii) file on a timely basis all reports and any
definitive proxy or information statements required to be filed by the
Company with the Commission subsequent to the date of the Prospectus
and prior to the termination of the offering of the Shares by the
Underwriters.
(ii) The Company will advise the Representatives promptly and, if
requested by the Underwriters will confirm such advise in writing,
when the Registration Statement has become effective and when any
post-effective amendment to it becomes effective, of any request of
the Commission for amendment of the Registration Statement or for
supplement to the Prospectus or for any additional information, or of
the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or the use of the
Prospectus or of the institution of any proceedings for that purpose,
and the Company will use its best efforts to prevent the issuance of
any such stop order preventing or suspending the use of the Prospectus
and to obtain as soon as possible the lifting thereof, if issued.
(iii) The Company will cooperate with the Representatives in
endeavoring to qualify the Shares for sale under the securities laws
of such jurisdictions as the Representatives may reasonably have
designated in writing and will make such applications, file such
documents, and furnish such information as may be reasonably required
for that purpose, provided the Company shall not be required to
qualify as a foreign corporation or to file a general consent to
service of process in any jurisdiction where it is not now so
qualified or required to file such a consent. The Company will, from
time to time, prepare and file such statements, reports, and other
documents as are or may be required to continue such qualifications in
effect for so long a period as the Representatives may reasonably
request for distribution of the Shares.
(iv) The Company will deliver to, or upon the order of, the
Representatives, from time to time, as many copies of any Preliminary
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Prospectus as the Representatives may reasonably request. The Company
will deliver to, or upon the order of, the Representatives during the
period when delivery of a Prospectus is required under the Act, as
many copies of the Prospectus in final form, or as thereafter amended
or supplemented, as the Representatives may reasonably request. The
Company will deliver to the Representatives at or before the Closing
Date, four signed copies of the Registration Statement and all
amendments thereto including all exhibits filed therewith, and will
deliver to the Representatives such number of copies of the
Registration Statement, and of all amendments thereto, as the
Representatives may reasonably request.
(v) If during the period in which a prospectus is required by
law to be delivered by an Underwriter or dealer any event shall occur
as a result of which, in the judgment of the Company or in the opinion
of counsel for the Underwriters, it becomes necessary to amend or
supplement the Prospectus in order to make the statements therein, in
the light of the circumstances existing at the time the Prospectus is
delivered to a purchaser, not misleading, or, if it is necessary at
any time to amend or supplement the Prospectus to comply with any law,
the Company promptly will prepare and file with the Commission an
appropriate amendment to the Registration Statement or supplement to
the Prospectus so that the Prospectus as so amended or supplemented
will not, in the light of the circumstances when it is so delivered,
be misleading, or so that the Prospectus will comply with the law.
(vi) The Company will make generally available to its security
holders, as soon as it is practicable to do so, but in any event not
later than 15 months after the effective date of the Registration
Statement, an earning statement (which need not be audited) in
reasonable detail, covering a period of at least 12 consecutive months
commencing no later than 90 days after the effective date of the
Registration Statement, which earning statement shall satisfy the
requirements of Section 11(a) of the Act and Rule 158 of the Rules and
Regulations and will advise you in writing when such statement has
been so made available.
(vii) The Company will, for a period of five years from the
Closing Date, deliver to the Representatives copies of annual reports
and copies of all other documents, reports and information furnished
by the Company to its stockholders or filed with any securities
exchange pursuant to the requirements of such exchange or with the
Commission pursuant to the Act or the Securities Exchange Act of 1934,
as amended, and the rules and regulations of the Commission thereunder
(the "Exchange Act"). The
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Company will deliver to the Representatives similar reports with
respect to significant subsidiaries, as that term is defined in the
Rules and Regulations, which are not consolidated in the Company's
financial statements.
(viii) No offering, sale or other disposition of any Common Stock
or securities convertible, exercisable or exchangeable into Common
Stock of the Company will be made for a period of 180 days after the
date of this Agreement, directly or indirectly, by the Company
otherwise than hereunder or options granted as set forth in the
Prospectus or with the prior written consent of the Representatives.
(ix) The Company will use its best efforts to cause the Shares to
be approved for quotation and trading on the NASDAQ National Market
and, if so approved, will comply with all applicable rules of the
NASDAQ National Market in connection with the transactions
contemplated hereby.
(x) The Company will use its best efforts to do and perform all
things required or necessary to be done and performed under this
Agreement by the Issuer prior to the Closing Date and to satisfy all
conditions precedent to the delivery of the Shares.
(xi) The Company will use the net proceeds received from the sale
of the Shares in the manner specified in the Prospectus under the
heading "Use of Proceeds", including executing an escrow deposit
agreement substantially in the form heretofore provided by the
Underwriters (the "Escrow Agreement") and depositing the funds
contemplated thereby with the agent thereunder (the "Escrow Agent")
for the purposes described therein.
(xii) If the Company has elected to rely upon Rule 430A under the
Act, to take such steps as they deem necessary to ascertain promptly
whether the form of prospectus transmitted for filing under Rule
424(b) under the Act was received for filing by the Commission and, in
the event that it was not, to promptly file such prospectus.
(xiii) The Company has complied, and will comply, with all of the
provisions of Florida H.B. 1771, as codified in Sec. 517.075 Florida
Statues, 1987, as amended, and all regulations promulgated thereunder
relating to issuers or their affiliates doing business with the
government of Cuba or with any person or affiliate located in Cuba.
5. COSTS AND EXPENSES. The Company will pay all costs, expenses and
fees incident to the performance of the obligations of the Company under
this
14
Agreement, including, without limiting the generality of the foregoing, the
following: accounting fees of the Company; the fees and disbursements of
counsel for the Company; the cost of printing and delivering to, or as
requested by, the Underwriters copies of the Registration Statement,
Preliminary Prospectuses, the Prospectus, this Agreement, the Invitation
Letter, the Listing Application, the Blue Sky Survey and any supplements or
amendments thereto; the filling fees of the Commission; the filing fees and
expenses incident to securing any required review by the National
Association of Securities Dealers, Inc. (the "NASD") of the terms of the
sale of the Shares; the Listing Fee of the NASDAQ National Market; and the
expenses, including the fees and disbursements of counsel for the
Underwriters, incurred in connection with the qualification of the Shares
under State securities or Blue Sky laws. The Company shall not, however,
be required to pay for any of the Underwriters expenses (other than those
related to qualification under State securities or Blue Sky laws) except
that, if this Agreement shall not be consummated because the conditions in
Section 7 hereof are not satisfied, or because this Agreement is terminated
by the Representatives pursuant to Section 6 hereof, or by reason of any
failure, refusal or inability on the part of the Company to perform any
undertaking or satisfy any condition of this Agreement or to comply with
any of the terms hereof on its part to be performed, unless such failure to
satisfy said condition or to comply with said terms be due to the default
or omission of any Underwriter, then the Company shall reimburse the
several Underwriters for reasonable out-of-pocket expenses, including fees
and disbursements of counsel, reasonably incurred in connection with
investigating, marketing and proposing to market the Shares or in
contemplation of performing their obligations hereunder; but the Company
shall not in any event be liable to any of the several Underwriters for
damages on account of loss of anticipated profits from the sale by them of
the Shares.
6. CONDITIONS OF OBLIGATIONS OF THE UNDERWRITERS. The several
obligations of the Underwriters to purchase the Firm Shares on the Closing
Date and the Option Shares, if any, on the Option Closing Date are subject
to the accuracy, as of the Closing Date or the Option Closing Date, as the
case may be, of the representations and warranties of the Company contained
herein, and to the performance by the Company of its covenants and
obligations hereunder and to the following additional conditions:
(a) No stop order suspending the effectiveness of the
Registration Statement, as amended from time to time, shall have been
issued and no proceedings from that purpose shall have been taken or, to
the knowledge of the Company, shall be contemplated by the Commission.
15
(b) Subsequent to the execution and delivery of this Agreement
and prior to the Closing Date, there shall not have been any downgrading,
nor shall any notice have been given of any intended or potential
downgrading or of any review for a possible change that does not indicate
the direction of the possible change, in the rating accorded any of the
Company's securities by any "nationally recognized statistical rating
organization," as such term is defined for purposes of Rule 436(g)(2) under
the Act.
(c) (i) Since the date of the latest balance sheet included in
the Registration Statement and the Prospectus, there shall not have been
(singly or in the aggregate) any material adverse change, or any
development involving a prospective material adverse change, in the
condition (financial or otherwise), or in the earnings or business affairs,
whether or not arising in the ordinary course of business, of the Company
and its Subsidiaries, considered as one enterprise, (ii) since the date of
the latest balance sheet included in the Registration Statement and the
Prospectus, there shall not have been any change, or any development
involving a prospective material adverse change, in the capital stock or in
the long-term debt of the Company from that set forth in the Registration
Statement and Prospectus and (iii) the Company and its Subsidiaries shall
not have any liability or obligation, direct or contingent, which (singly
or in the aggregate) is material to the condition (financial or otherwise),
earnings or business affairs of the Company and its Subsidiaries,
considered as one enterprise, other than those reflected in the
Registration Statement and the Prospectus.
(d) The Underwriters shall have received on the Closing Date an
opinion (satisfactory to the Underwriters and counsel for the
Underwriters), dated the Closing Date, of Hutton Ingram Yuzek Gainen
Carroll & Bertolotti, counsel for the Company, to the effect that:
(i) The Company and each corporate Subsidiary of the
Company listed on Schedule II hereto have been duly incorporated and
are validly existing as corporations in good standing under the laws
of their respective jurisdictions of incorporation, (each Subsidiary
listed on Schedule II hereto, a "Significant Subsidiary"), and each
has the corporate power or partnership power, as the case may be, and
authority required to carry on its business as described in the
Prospectus and to own and lease its properties;
(ii) The Issuer has all requisite corporate power and
authority to execute, deliver and perform its obligations under the
Underwriting Agreement and to issue, sell and deliver the Shares to
the Underwriters as provided herein;
16
(iii) Each of the Company and its Significant Subsidiaries is
duly qualified and in good standing as a foreign corporation,
authorized to do business in each jurisdiction in which such counsel
has been advised by the Company, as set forth in an officer's
certificate attached to the opinion, that the Company or such
Significant Subsidiary owns or leases property or employs personnel,
except where the failure to be so qualified would not have (singly or
in the aggregate) a material adverse effect on the condition
(financial or otherwise), earnings or business affairs of the Company
and its Subsidiaries, considered as one enterprise;
(iv) The Company has authorized capital stock as set forth
under the caption "Description of Capital Stock" in the Prospectus;
and, based upon such Counsel's review of the minute book records,
including the stock transfer records, of the Company and the officer's
certificate, the Company has outstanding capital stock as set forth
under the caption "Ownership of Common Stock" in the Prospectus; the
authorized shares of its Common Stock have been duly authorized; and
the outstanding shares of the Company's Common Stock have been duly
authorized, validly issued and are fully paid and non-assessable; all
of the Shares conform to the description thereof contained in the
Prospectus; the certificates for the Shares are in due and proper
form; the shares of Common Stock, including the Option Shares, if any,
to be sold by the Company pursuant to this Agreement have been duly
authorized and will be validly issued, fully paid and non-assessable
when issued and paid for as contemplated by this Agreement; and, to
such counsel's knowledge, no preemptive rights of stockholders exist
with respect to any of the Shares or the issuance and sale thereof.
(v) Based upon such counsel's review of the minute book
records, including the stock transfer records of the Company and each
of its Significant Subsidiaries, all of the issued and outstanding
shares of capital stock of each of the Company's corporate Significant
Subsidiaries have been duly and validly authorized and are fully paid
and non-assessable and to the knowledge of such counsel all such
shares are validly issued and, to such counsel's knowledge are owned
by the Company set forth opposite its name on Schedule IV hereto
except for a 10% equity interest of South Charleston Stamping &
Manufacturing Company and directors' qualifying shares of American
Country Insurance Company, are owned by the Company free and clear of
any security interest, charge, claim, lien, encumbrance or adverse
interest of any nature, except that (x) the shares of stock of
subsidiaries of Checker Motors Corporation have been pledged in
connection with the NBD Loan (y) the shares of stock of Great Dane's
17
subsidiaries have been pledged in connection with the BankAmerica Loan
and (z) the Company has agreed, in connection with the BankAmerica
Loan, not to sell, assign, transfer, convey or otherwise dispose of or
grant any option with respect to the stock of Great Dane, and to such
counsel's knowledge, and no options, warrants or other rights to
purchase, agreements or other obligations to issue or other rights to
convert any obligations into any shares of capital stock or of
ownership interests in the Subsidiaries are outstanding;
(vi) The execution, delivery and performance of this
Agreement by the Issuer and the compliance by the Issuer with all the
provisions hereof and thereof and the consummation of the transactions
contemplated hereby and thereby (including, without limitation, the
issuance and sale of the Shares), (A) will not require any consent,
approval, authorization or other order of any court, regulatory body,
administrative agency or other governmental body (except such as may
be required under the Act, the Exchange Act, the securities or Blue
Sky laws of the various states or the by-laws of the NASD) or, if so
required, all such consents, approvals, authorizations and orders have
been obtained and are in full force and effect, (B) will not violate
or constitute a breach of any of the terms or provisions of, or a
default under, the charter or by-laws or other governing documents, as
the case may be, of the Issuer, or any agreement, indenture or other
instrument to which the Issuer is a party or by which the Issuer or
their respective assets or property is bound and which is listed on
Schedule III hereto, which schedule, according to a certificate of the
Issuer dated as of the date of such counsel's opinion, contains all
agreements, indentures or instruments material to the business of the
Company, considered as one enterprise, or (C), to such counsel's
actual knowledge, violate or conflict with any material laws,
administrative regulations or rulings or court decrees applicable to
any of the Issuer or any of their respective assets or properties;
(vii) This Agreement has been duly authorized, executed and
delivered by the Issuer;
(viii) The Escrow Agreement has been duly authorized, executed
and delivered by the Issuer and, assuming due authorization, execution
and delivery by the Escrow Agent, constitutes a valid and binding
obligation of the Issuer, enforceable against the Issuer in accordance
with its terms, except as (A) the enforceability hereof may be limited
by bankruptcy, insolvency or similar laws affecting creditors' rights
generally
18
and (B) the availability of equitable remedies may be limited by
equitable principles of general applicability;
(ix) The Registration Statement has become effective under
the Act, and such counsel does not know of the issuance of any stop
order suspending the effectiveness of the Registration Statement by
the Commission or of any proceedings for that purpose under the Act;
(x) The statements in the Prospectus and the statements in
Part II of the Registration Statement insofar as such statements
constitute a summary of written contracts, written agreements or other
legal documents or refers to statements of law or legal conclusions,
present fairly the information called for with respect to such written
contracts, written agreements or other legal documents or refers to
statements of law or legal conclusions;
(xi) Such counsel does not know of any legal or governmental
proceeding to which the Company or any of its Subsidiaries is a party
or of which any of their respective assets or property is the subject
which is required to be described in the Registration Statement or the
Prospectus and is not so described, or of any contract or other
document which is required to be described in the Registration
Statement or the Prospectus or is required to be filed as an exhibit
to the Registration Statement which is not described or filed as
required;
(xii) The Issuer is not an "investment company" or a company
"controlled" by an "investment company" within the meaning of the
Investment Company Act of 1940, as amended;
(xiii) To such counsel's actual knowledge, no holder of any
security of the Issuer has any right to have any shares of Common
Stock or other securities of the Issuer included in the Registration
Statement or any right, as a result of the filing of the Registration
Statement, to require registration of any Common Stock or any other
securities of the Issuer under the Act;
(xiv) The Registration Statement, the Prospectus and each
supplement or amendment thereto (except for financial statements and
notes thereto and other financial and statistical data included
therein as to which no opinion need be expressed) appear on their face
to be appropriately responsive as to form in all material respects
with the Act; and
19
Such counsel will state that it has not undertaken, except
as otherwise indicated in their opinion, to determine independently, and
does not assume any responsibility for, the accuracy or completeness of the
statements in the Registration Statement; however, such counsel has
participated in the preparation of the Registration Statement and the
Prospectus, including review and discussion of the contents thereof, and
nothing has come to the attention of such counsel that has caused it to
believe that the Registration Statement at the time the Registration
Statement became effective, contained an untrue statement of a material
fact or omitted to state a material fact required to be stated therein or
necessary to make the statements therein not misleading or that the
Prospectus or any amendment or supplement to the Prospectus, as of its
respective date and as of the Closing Date, contained or contains any
untrue statement of a material fact or omitted or omits to state a material
fact necessary in order to make the statements therein, in the light of the
circumstances under which they are made, not misleading (it being
understood that such counsel need express no comment with respect to the
financial statements and the notes thereto and the financial schedules and
other financial data included in the Registration Statement or the
Prospectus).
In rendering such opinion, counsel may rely as to matters of
fact, to the extent such counsel deems proper, on (1) the representations
and warranties of the Issuer set forth in this Agreement, and (2)
certificates of responsible officers of the Issuer and public officials.
(e) The Underwriters shall have received on the Closing Date an
opinion, dated the Closing Date, of Fried, Frank, Harris, Shriver &
Jacobson, counsel for the Underwriters to the effect that:
(i) The Company is validly existing as a corporation under
the laws of the state of Delaware;
(ii) The shares of Common Stock, including the Option
Shares, if any, to be sold by the Company pursuant to this Agreement
have been duly authorized and will be validly issued, fully paid and
non-assessable when issued and paid for as contemplated by this
Agreement;
(iii) This Agreement has been duly authorized, executed
and delivered by the Issuer;
(iv) The Registration Statement has become effective under
the Act, and such counsel does not know of the issuance of any stop
order suspending the effectiveness of the Registration Statement by
the Commission or of any proceeding for that purpose under the Act;
20
(v) The Registration Statement, the Prospectus and each
supplement or amendment thereto (except for financial statements and
notes thereto and other financial and statistical data included
therein as to which no opinion need be expressed) appear on their face
to be appropriately responsive as to form in all material respects
with the Act; and
(vi) The statements in the Prospectus under the captions
"Description of Capital Stock" and "Underwriting," are accurate in all
material respects.
Hutton Ingram Yuzek Gainen Carroll & Bertolotti and Fried, Frank,
Harris, Shriver & Jacobson may state that their respective opinions,
insofar as they relate to matters involving the application of laws other
than the laws of the United States and jurisdictions in which they are
admitted, are made in reliance, to the extent specified in such opinions,
upon the opinion or opinions of (i) Sonnenschein, Nath & Rosenthal as to
matters concerning the laws of the State of Illinois, (ii) McCarter &
English, as to matters concerning the laws of the State of New Jersey;
(iii) Hunter, Maclean, Exley & Dunn, P.C., as to matters concerning the
laws of the State of Georgia; (iv) Tuke, Yopp & Sweeney, as to matters
concerning the laws of the State of Tennessee; (v) Bowles Rice McDavid
Graff & Love, as to matters concerning the laws of the State of West
Virginia; and (vi) an opinion or opinions (in form and substance
satisfactory to Underwriters' counsel) of other counsel acceptable to
Underwriters' counsel, admitted to practice in the governing jurisdiction,
but are without independent check or verification except as specified,
PROVIDED that a copy of all such opinions shall be attached to such
counsel's opinion.
(f) The Underwriters shall have received at or prior to the
Closing Date from Fried, Frank, Harris, Shriver & Jacobson a memorandum or
survey, in form and substance satisfactory to the Underwriters, with
respect to the qualification for offering and sale by the Underwriters of
the Shares under the state securities or Blue Sky laws of such
jurisdictions as the Underwriters may reasonably have designated to the
Issuer.
(g) The Underwriters shall have received on the Closing Date a
certificate or certificates of the President and the Chief Operating
Officer of the Issuer to the effect that, as of the Closing Date, each of
them severally represents as follows:
(i) Confirmation of the matters set forth in paragraphs
(a), (b) and (c) of this Section 6.
21
(ii) He does not know of any litigation instituted or
threatened against the Issuer of a character required to be disclosed
in the Registration Statement which is not so disclosed; he does not
know of any material contract required to be filed as an exhibit to
the Registration Statement which is not so filed.
(iii) He has carefully examined the Registration
Statement and the Prospectus and, in his opinion, as of the effective
date of the Registration Statement, the statements contained in the
Registration Statement and the Prospectus were true and correct in all
material respects, and such Registration Statement and Prospectus did
not omit to state a material fact required to be stated therein or
necessary in order to make the statements therein (A) with respect to
the Prospectus or any amendment or supplement thereto, in light of the
circumstances under which they were made, and (B) with respect to the
Registration Statement or any amendment or supplement thereto not
misleading and, in his opinion, since the effective date of the
Registration Statement, no event has occurred which should have been
set forth in a supplement to or an amendment of the Prospectus which
has not been so set forth in such supplement or amendment.
(h) The Underwriters shall have received a letter on and as of
the Closing Date, in form and substance satisfactory to the Underwriters,
from Ernst & Young LLP, independent public accountants, with respect to the
financial statements and certain financial information contained in the
Registration Statement and the Prospectus and substantially in the form and
substance of the letter delivered to the Underwriters by Ernst & Young LLP
on the date of this Agreement.
(i) The Issuer shall not have failed at or prior to the Closing
Date to perform or comply with any of the agreements contained herein and
required to be performed or complied with by the Company at or prior to the
Closing Date.
(j) The Company shall have furnished to the Representatives such
further certificates and documents confirming the representations and
warranties contained herein and related matters as the Representatives may
reasonably have requested.
(k) David R. Markin, Martin L. Solomon, Allan R. Tessler and
Wilmer J. Thomas, Jr. shall each have delivered to the Representatives an
agreement not to offer, pledge, sell, contact to sell or otherwise dispose
of any shares of Common Stock (or securities convertible into shares of
Common Stock),
22
directly or indirectly for a period of 180 days after the date of this
Agreement, without the prior written consent of the Representatives.
(l) The Firm Shares and Option Shares, if any, have been
approved for designation upon notice of issuance on the NASDAQ National
Market System.
If any of the conditions hereinabove provided for in this Section
6 shall not have been fulfilled when and as required by this Agreement to
be fulfilled, the obligations of the Underwriters hereunder may be
terminated by the Representatives by notifying the Company of such
termination in writing or by telegram at or prior to the Closing Date or
the Option Closing Date, as the case may be.
In such event, the Company and the Underwriters shall not be
under obligation to each other (except to the extent provided for in
Sections 5 and 8 hereof or otherwise expressly provided herein).
7. CONDITIONS OF THE OBLIGATIONS OF THE COMPANY. The obligations of
the Company to sell and deliver the portion of the Shares required to be
delivered as and when specified in this Agreement are subject to the
conditions that at the Closing Date or the Option Closing Date, as the case
may be, no stop order suspending the effectiveness of the Registration
Statement shall have been issued and in effect of proceedings therefor
initiated or threatened.
8. INDEMNIFICATION.
(a) The Issuer agrees to indemnify and hold harmless each
Underwriter and each person, if any, who controls any Underwriter within
the meaning of the Act against any losses, claims, damages or liabilities
to which such Underwriter or such controlling person may become subject
under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions or proceedings in respect thereof) arise out of or
are based upon (i) any untrue statement or alleged untrue statement of any
material fact contained in the Registration Statement, any preliminary
prospectus, the Prospectus, or any amendment or supplement thereto or
(ii) the omission or alleged omission to state (A) with respect to the
Prospectus or any amendment or supplement thereto, a material fact required
to be stated therein or necessary to make the statements therein, in light
of the circumstances under which they were made, not misleading and (B)
with respect to the Registration Statement or any amendment or supplement
thereto, a material fact required to be stated therein or necessary to make
the statements therein not misleading, and will reimburse each Underwriter
23
and each such controlling person for any legal or other expenses reasonably
incurred by such Underwriter or such controlling person in connection with
investigating or defending any such loss, claim, damage, liability, action
or proceeding; provided, however, that the Issuer will not be liable to an
Underwriter or such controlling person of that Underwriter in any such case
to the extent that any such loss, claim, damage or liability arises out of
or is based upon an untrue statement, or alleged untrue statement, or
omission or alleged omission made in the Registration Statement, any
preliminary prospectus, the Prospectus, or such amendment or supplement, in
reliance upon and in conformity with written information furnished to the
Issuer by such Underwriter specifically for use in the preparation thereof;
and further provided that such indemnity with respect to any preliminary
prospectus shall not inure to the benefit of any Underwriter or controlling
person of such Underwriter, if the person asserting any such loss, claim,
damage or liability did not receive a copy of the Prospectus (or the
Prospectus, as amended or supplemented) at or prior to the written
confirmation of the sale of such Shares by such Underwriter to such person
where such delivery of the Prospectus (or the Prospectus, as amended or
supplemented) is required by the Act, unless such failure to deliver was a
result of the Company's failure to deliver the Prospectus to such
Underwriter, and if the untrue statement or omission of a material fact
contained in such preliminary prospectus was corrected in the Prospectus
(or the Prospectus, as amended or supplemented). This indemnity agreement
is in addition to any liability which the Issuer may otherwise have.
(b) The Underwriters agree, severally and not jointly, that they
will indemnify and hold harmless the Company, each of the Company's
directors, each of the Company's officers who have signed the Registration
Statement and each person, if any, who controls the Issuer within the
meaning of the Act, against any losses, claims, damages or liabilities to
which such Issuer or any such director, officer, or controlling person may
become subject under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions or proceedings in respect thereof) arise
out of or are based upon (i) any untrue statement or alleged untrue
statement of any material fact contained in the Registration Statement, any
preliminary prospectus, the Prospectus or any amendment or supplement
thereto, or (ii) the omission or the alleged omission to state (A) with
respect to the Prospectus or any amendment or supplement thereto, a
material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were
made, not misleading and (B) with respect to the Registration Statement or
any amendment or supplement thereto, a material fact required to be stated
therein or necessary to make the statements therein not misleading, and
will reimburse any legal or other expenses reasonably incurred by such
Issuer or any such director, officer, or controlling person in connection
with
24
investigating or defending any such loss, claim, damage, liability, action
or proceeding; PROVIDED, however, that an Underwriter will be liable in
each case to the extent, but only to the extent, that such untrue statement
or alleged untrue statement or omission or alleged omission has been made
in the Registration Statement, any preliminary prospectus, the Prospectus
or such amendment or supplement, in reliance upon and in conformity with
written information furnished to such Issuer by or through such Underwriter
specifically for use in the preparation thereof. This indemnity agreement
is in addition to any liability which the Underwriters may otherwise have.
(c) In case any proceeding (including any governmental
investigation) shall be instituted involving any person in respect of
which indemnity may be sought pursuant to this Section 8, such person (the
"Indemnified Party") shall promptly notify the person against whom such
indemnity may be sought (the "Indemnifying Party") in writing. No
indemnification provided for in Section 8(a) or (b) shall be available to
any party who shall fail to give notice as provided in this Section 8(c) if
the party to whom notice was not given was unaware of the proceeding to
which such notice would have related and was materially prejudiced by
failure to give such notice, but the failure to give such notice shall not
relieve the Indemnifying Party or Parties from any liability which it or
they may have to the Indemnified Party for contribution or otherwise than
on account of the provisions of Section 8(a) or (b). In case any such
proceeding shall be brought against any Indemnified Party and it shall
notify the Indemnifying Party of the commencement thereof, the Indemnifying
Party shall be entitled to participate therein and, to the extent that it
shall wish, jointly with any other Indemnifying Party similarly notified,
to assume the defense thereof, with counsel reasonably satisfactory to such
Indemnified Party and shall pay as incurred the fees and disbursements of
such counsel related to such proceeding. In any such proceeding, any
Indemnified Party shall have the right to retain its own counsel at its own
expense. Notwithstanding the foregoing, the Indemnifying Party shall pay
as incurred the fees and expenses of the counsel retained by the
Indemnified Party in the event (i) the Indemnifying Party and the
Indemnified Party shall have mutually agreed to the retention of such
counsel or (ii) the named parties to any such proceeding (including any
impleaded parties) include both the Indemnifying Party and the Indemnified
Party and representation of both parties by the same counsel would be
inappropriate due to actual or potential differing interests between them.
It is understood that unless representation of more than one Indemnified
Party by the same counsel would be inappropriate due to actual or potential
differing interests between them, the Indemnifying Party shall not, in
connection with any proceeding or related proceedings in the same
jurisdiction, be liable for the reasonable fees and expenses of more than
one separate firm for all
25
such Indemnified Parties. Such firm shall be designated in writing by the
Underwriters in the case of parties indemnified pursuant to Section 8(a)
and by the Issuer in the case of parties indemnified pursuant to Section
8(b). The Indemnifying Party shall not be liable for any settlement of any
proceeding effected without its written consent but if settled with such
consent or if there be a final judgment for the plaintiff, the Indemnifying
Party agrees to indemnify the Indemnified Party from and against any loss
or liability by reason of such settlement or judgment. Notwithstanding the
foregoing sentence, if at any time an Indemnified Party shall have
requested an Indemnifying Party to reimburse the Indemnified Party for fees
and expenses of counsel as contemplated by the fifth sentence of this
paragraph, the Indemnifying Party agrees that it shall be liable for any
settlement of any proceeding effected without its written consent if
(i) such settlement is entered into more than 60 business days after
receipt by such Indemnifying Party of the aforesaid request and (ii) such
Indemnifying Party shall not have reimbursed the Indemnified Party in
accordance with such request prior to the date of such settlement. No
Indemnifying Party shall, without the prior written consent of the
Indemnified Party, effect any settlement of any pending or threatened
proceeding in respect of which any Indemnified Party is or could have been
a party and indemnity could have been sought hereunder by such Indemnified
Party, unless such settlement includes an unconditional release of such
Indemnified Party from all liability on claims that are the subject matter
of such proceeding.
(d) If the indemnification provided for in this Section 8 is
unavailable to or insufficient to hold harmless an Indemnified Party under
Section 8(a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions or proceedings in respect thereof) referred to
therein, then each Indemnifying Party shall contribute to the amount paid
or payable by such Indemnified Party as a result of such losses, claims,
damages or liabilities (or actions or proceedings in respect thereof) in
such proportion as is appropriate to reflect the relative benefits received
by the Issuer on the one hand and the Underwriters on the other from the
offering of the Common Stock. If, however, the allocation provided by the
immediately preceding sentence is not permitted by applicable law or if the
Indemnified Party failed to give the notice required under Section 8(c)
above, then each Indemnifying Party shall contribute to such amount paid or
payable by such Indemnified Party in such proportion as is appropriate to
reflect not only such relative benefits but also the relative fault of the
Issuer on the one hand and the Underwriters on the other in connection with
the statements or omissions which resulted in such losses, claims, damages
or liabilities (or actions or proceedings in respect thereof), as well as
any other relevant equitable considerations. The relative benefits
received by the Issuer on the one hand and the Underwriters on
26
the other shall be deemed to be in the same proportion as the total net
proceeds from the offering (before deducting expenses) received by the
Issuer bear to the total underwriting discounts and commissions received by
the Underwriters, in each case as set forth in the table on the cover page
of the Prospectus. The relative fault shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Issuer on the one hand or the
Underwriters on the other and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement
or omission.
The Issuer and the Underwriters agree that it would not be just
and equitable if contributions pursuant to this Section 8(d) were
determined by pro rata allocation or by any other method of allocation
which does not take account of the equitable considerations referred to
above in this Section 8(d). The amount paid or payable by an Indemnified
Party as a result of the losses, claims, damages or liabilities (or actions
or proceedings in respect thereof) referred to above in this Section 8(d)
shall be deemed to include any legal or other expenses reasonably incurred
by such Indemnified Party in connection with investigating or defending any
such action or claim. Notwithstanding the provisions of this subsection
(d), (i) no Underwriter shall be required to contribute any amount in
excess of the underwriting discounts and commissions applicable to the
Shares purchased by such Underwriter and (ii) no person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Act) shall be entitled to contribution from any person who was not guilty
of such fraudulent misrepresentation.
(e) In any proceeding relating to the Registration Statement,
any preliminary prospectus, the Prospectus or any supplement or amendment
thereto, each party against whom contribution may be sought under this
Section 8 hereby consents to the jurisdiction of any court having
jurisdiction over any other contributing party, agrees that process issuing
from such court may be served upon him or it by any other contributing
party and consents to the service of such process and agrees that any other
contributing party may join him or it as an additional defendant in any
such proceeding in which such other contributing party is a party.
9. DEFAULT BY UNDERWRITERS. If on the Closing Date or the Option
Closing Date, as the case may be, any Underwriter shall fail to purchase
and pay for the portion of the Shares which Underwriter has agreed to
purchase and pay for on such date (otherwise than by reason of any default
on the part of the Company), you, as Representatives of the Underwriters,
shall use your best efforts to procure within 24 hours thereafter one or
more of the other Underwriters, or any others, to purchase from the Company
such amounts as may be agreed upon and upon the
27
terms set forth herein, the Firm Shares or Option Shares, as the case may
be, which the defaulting Underwriter or Underwriters failed to purchase.
If during such 24 hours you, as such Representatives, shall not have
procured such other Underwriters, or any others, to purchase the Firm
Shares or Option Shares, as the case may be, agreed to be purchased by the
defaulting Underwriter or Underwriters, then (a) if the aggregate number of
shares with respect to which such default shall occur does not exceed 10%
of the Firm Shares or Option Shares as the case may be, covered hereby, the
other Underwriters shall be obligated, severally, in proportion to the
respective numbers of Firm Shares or Option Shares, as the case may be,
which they are obligated to purchase hereunder, to purchase the Firm Shares
or Option Shares, as the case may be, which such defaulting Underwriter or
Underwriters failed to purchase, or (b) if the aggregate number of shares
of Firm Shares or Option Shares, as the case may be, with respect to which
such default shall occur exceeds 10% of the Firm Shares or Option Shares,
as the case may be, covered hereby, the Company or you as the
Representatives of the Underwriters will have the right, by written notice
given within the next 24-hour period to the parties to this Agreement, to
terminate this Agreement without liability on the part of the non-
defaulting Underwriters or of the Company except to the extent provided in
Section 8 hereof. In the event of a default by any Underwriter or
Underwriters, as set forth in this Section 9, the Closing Date or Option
Closing Date, as the case may be, may be postponed for such period, not
exceeding seven days, as you, as Representatives, may determine in order
that the required changes in the Registration Statement or in the
Prospectus or in any other documents or arrangements may be effected. The
term "Underwriter" includes any person substituted for a defaulting
Underwriter. Any action taken under this Section 9 shall not relieve any
defaulting Underwriter from liability in respect of any default of such
Underwriter under this Agreement.
10. NOTICES. All communications hereunder shall be in writing and,
except as otherwise provided herein, will be mailed, delivered or
telegraphed and confirmed as follows: if to the Underwriters, to Alex.
Brown & Sons Incorporated, 135 East Baltimore Street, Baltimore, Maryland
21202, Attention: Peter McGowan; if to the Company, to Great Dane Holdings
Inc., 2016 North Pitcher Street, Kalamazoo, Michigan 49007, Attention:
David R. Markin, President and Chief Executive Officer.
11. TERMINATION: This Agreement may be terminated by you by notice
to the Company as follows:
(a) at any time prior to the earlier of (i) the time the Shares are
released by you for the sale by notice to the Underwriters, or (ii) 11:30
a.m. on the first business day following the date of this Agreement;
28
(b) at any time prior to the Closing Date if any of the following has
occurred: (i) since the respective dates as of which information is given
in the Registration Statement and the Prospectus, any material adverse
change or any development involving a prospective material adverse change
in or affecting the condition, financial or otherwise, of the Company and
its Subsidiaries taken as a whole or the earnings, business affairs,
management or business prospectus of the Company and its Subsidiaries taken
as a whole, whether or not arising in the ordinary course of business, (ii)
any outbreak of hostilities or other national or international calamity or
crisis or change in economic or political conditions if the effect of such
outbreak, calamity, crisis or change on the financial markets of the United
States would, in your reasonable judgment, make the offering or delivery of
the Shares impracticable, (iii) suspension of trading in securities on the
New York Stock Exchange or the American Stock Exchange or limitation on
prices (other than limitations on hours or numbers of days of trading) for
securities on either such Exchange, (iv) the enactment, publication, decree
or other promulgation of any federal or state statute, regulation, rule or
order of any court or other governmental authority which in your reasonable
opinion materially and adversely affects or will materially or adversely
affect the business or operations of the Company, (v) declaration of a
banking moratorium by either federal or New York State authorities, or (vi)
the taking of any action by any federal, state or local government or
agency in respect of its monetary or fiscal affairs which in your
reasonable opinion has a material adverse effect on the securities markets
in the United States; or
(c) as provided in Sections 6 and 9 of this Agreement.
This Agreement also may be terminated by you, by notice of the
Company, as to any obligation of the Underwriters to purchase the Option
Shares, upon the occurrence at any time prior to the Option Closing Date of
any of the events described in subparagraph (b) above or as provided in
Sections 6 and 9 of this Agreement.
12. SUCCESSORS. This Agreement has been and is made solely for the
benefit of the Underwriters and, the Company and their respective
successors, executors, administrators, heirs and assigns, and the officers,
directors and controlling persons referred to herein, and no other person
will have any right or obligation hereunder. The term "successors" shall
not include any purchaser of the Shares merely because of such purchase.
13. MISCELLANEOUS. The reimbursement, indemnification and
contribution agreements contained in this Agreement and the
representations, warranties and covenants in this Agreement shall remain in
full force and effect
29
regardless of (a) any termination of this Agreement, (b) any investigation
made by or on behalf of any Underwriter or controlling person thereof, or
by or on behalf of the Company or its directors or officers and (c)
delivery of and payment for the Shares under this Agreement.
This Agreement may be executed in two or more counterparts, each
of which shall be deemed and original, but all of which together shall
constitute one and the same instrument.
The letter agreement between the Company and Alex. Brown & Sons
Incorporated dated November 21, 1994 shall remain in full force and effect,
except for the first paragraph of Section 3 of such letter which shall be
superseded by this Agreement.
This Agreement shall be governed by, and construed in accordance
with, the laws of the State of New York without giving effect to the
principles of conflicts of laws thereof.
30
If the foregoing letter is in accordance with your understanding
of our agreement, please sign and return to us the enclosed duplicates
hereof, whereupon it will become a binding agreement among the Company and
the several Underwriters in accordance with its terms.
Very truly yours,
GREAT DANE HOLDINGS INC.
By:
------------------------------------------
Name
Title
The foregoing Underwriting Agreement
is hereby confirmed and accepted as of
the date first above written.
ALEX. BROWN & SONS INCORPORATED
SMITH BARNEY INC.
- -----------------------------------
As Representatives of the several
Underwriters listed on Schedule I
By: ALEX. BROWN & SONS INCORPORATED
By:
--------------------------------
Name
Title
31
SCHEDULE I
SCHEDULE OF UNDERWRITERS
Number of Firm Shares
Underwriter to be Purchased
------------- ---------------------
Alex. Brown & Sons Incorporated
Smith Barney Inc.
-------------
Total
-------------
I-1
SCHEDULE II
SIGNIFICANT SUBSIDIARIES OF
GREAT DANE HOLDINGS INC.
Jurisdiction of
Company Name(1) Incorporation/Organization
- --------------- ---------------------------
Great Dane Trailers, Inc. Georgia
Great Dane Trailers Tennessee, Inc. Tennessee
Great Dane Los Angeles, Inc. Georgia
Checker Motors Corporation New Jersey
CMC Kalamazoo Inc. Delaware
Yellow Cab Company Delaware
Chicago AutoWerks Inc. Delaware
American Country Insurance Company(2) Illinois
South Charleston Stamping & West Virginia
Manufacturing Company(3)
- ---------------
1. American Country Insurance Company ("Country") is 99.96% owned by Checker
Motors Corporation, and .04% owned by Country's directors.
2. South Charleston Stamping & Manufacturing Company is 90% owned by Checker
Motors Corporation and 10% owned by a nominee of Executive Life Insurance
Company.
3. South Charleston Stamping & Manufacturing Company is 90% owned by Checker
Motors Corporation and 10% owned by a nominee of Executive Life Insurance
Company.
II-1
SCHEDULE III
MATERIAL AGREEMENTS,
INDENTURES OR INSTRUMENTS
1. Indenture between ICC and First Fidelity Bank, National Association, New
Jersey, as Trustee, relating to the 12 3/4% Senior Subordinated Debentures
due August 1, 2001 of the Company.
2. First Supplemental Indenture relating to the 12 3/4% Senior Subordinated
Debentures due August 1, 2001 of ICC dated as of October 19, 1994 among
ICC, the Company and First Fidelity.
3. Indenture between ICC and Midlantic National Bank, as Trustee, relating to
the 14 1/2% Subordinated Discount Debentures due January 1, 2006 of the
Company.
4. First Supplemental Indenture relating to the 14 1/2% Subordinated Discount
Debentures due January 1, 2006 of ICC, dated October 19, 1994 among ICC,
the Company and Midlantic.
5. Great Dane Holdings Inc. 1994 Stock Option Plan.
6. Amended and Restated Employment Agreement, dated as of November 1, 1985,
between Motors and David R. Markin, as further amended on March 4, 1992 and
extended on July 12, 1993.
7. Amended and Restated Employment Agreement, dated as of June 1, 1992,
between Checker L.P. and Jeffrey Feldman.
8. Stated Benefit Salary Continuation Agreement.
9. Employment Agreement, dated as of July 1, 1992, between ICC and Jay H.
Harris, as amended April 6, 1994.
10. Loan Agreement, dated January 26, 1995, by and among Motors, Yellow Cab,
AutoWerks, CMC, SCSM, the Lenders therein and NBD Bank, as Agent ("NBD").
11. Pledge Agreement and Irrevocable Proxy, dated as of January 26, 1995, given
by Motors to NBD.
12. Security Agreement, dated as of January 26, 1995, made by Motors, Yellow
Cab, AutoWerks and CMC to NBD.
III-1
13. Amended and Restated Loan and Security Agreement dated as of February 14,
1995, by and among Great Dane, Great Dane Trailers Tennessee, Inc., Great
Dane Los Angeles, Inc., the financial institutions named therein and
BankAmerica Business Credit Inc., as Agent ("BABC").
14. Amended and Restated Pledge Agreement, dated as of February 14, 1995, made
by Great Dane Trailers, Inc., in favor of BABC.
15. Amended and Restated Agreement Regarding Stock and Other Matters, dated as
of February 14, 1995, between the Company and BABC.
16. Lease, dated December 1, 1988, between SCSM and Park Corporation.
17. Assumption Agreement, dated as of August 1, 1989, by and between Motors and
the West Virginia Economic Development Authority.
18. Agreement, dated as of September 1, 1991, between Checker L.P. and Jerry E.
Feldman.
19. Form of Checker Motors Corporation Excess Benefit Retirement Plan,
effective January 1, 1983.
20. Amended and Restated License Agreement, dated December 30, 1992, between
Checker Motors Corporation and Checker Taxi Association, Inc.
21. Settlement Agreement, dated as of December 22, 1993, between the Company
and The Boeing Company.
22. Employment Agreement, dated as of January 1, 1994, between the Company and
David R. Markin.
23. Employment Agreement, dated as of November 4, 1991, between Great Dane and
Willard R. Hildebrand.
24. Settlement Agreement, dated as of June 21, 1994, among John Garamendi, as
Insurance Commissioner of the State of California, Base Assets Trust,
Checker L.P., Motors, Checker Holding Corp. III and the Company.
25. Form of Indemnification Agreement.
26. Sale, Installation and Technical Assistance Agreement, dated November 14,
1983, between Graaff KG and Great Dane Trailers, Inc.
III-2
27. Form of Great Dane Trailers, Inc. Supplemental Retirement Income Plan,
effective January 1, 1994.
28. Amended and Restated Operating Agreement, dated as of August 31, 1988,
between Associates Commercial Corporation (as successor to Great Dane
Finance Company) and Great Dane Trailers, Inc. as amended February 7, 1994
and May 18, 1994.
29. 1995 Outside Directors Stock Option Plan.
30. Stock Option Agreement between the Company and Jay H. Harris dated as of
January 17, 1995.
31. Retirement Plan for Great Dane Trailers, Inc. effective January 1, 1989.
32. Checker Motors Pension Plan, as amended and restated effective
January 1, 1987.
33. Composite Checker Employees' 401(k) Retirement Benefit Plan, reflecting all
amendments to date.
III-3
SCHEDULE IV
Name of Entity Stock Owned By
- -------------- --------------
Checker Motors Corporation Great Dane Holdings
Yellow Cab Company Checkers Motors Corporation
CMC Kalamazoo Inc. Checkers Motors Corporation
Chicago AutoWerks Inc. Checkers Motors Corporation
American Country Insurance Company Checkers Motors Corporation
South Charleston Stamping & Checkers Motors Corporation
Manufacturing Company (90% owned)
Great Dane Trailers, Inc. Great Dane Holdings Inc.
Great Dane Los Angeles, Inc. Great Dane Trailers, Inc.
Great Dane Trailers Tennessee, Inc. Great Dane Trailers, Inc.
IV-1