EXHIBIT 4.3
The Goodyear Tire & Rubber Company
4.00% Convertible Senior Notes due 2034
Purchase Agreement
June 28, 2004
Goldman, Sachs & Co.
Deutsche Bank Securities Inc.
J.P. Morgan Securities Inc.
c/o Goldman, Sachs & Co.
85 Broad Street,
New York, New York 10004
Ladies and Gentlemen:
The Goodyear Tire & Rubber Company, an Ohio corporation (the "Company"),
proposes, subject to the terms and conditions stated herein, to issue and sell
to the Purchasers named in Schedule I hereto (the "Purchasers") an aggregate of
$300,000,000 principal amount of the Convertible Senior Notes, convertible into
fully paid, non-assessable shares of common stock, no par value, of the Company
("Stock"), specified above (the "Firm Securities") and, at the election of the
Purchasers, up to an aggregate of $50,000,000 additional aggregate principal
amount of the Convertible Senior Notes specified above (the "Optional
Securities") (the Firm Securities and the Optional Securities which the
Purchasers elect to purchase pursuant to Section 2 hereof are herein
collectively called the "Securities"). The Securities will be issued pursuant to
an indenture (the "Indenture") to be dated as of the date of the First Time of
Delivery (as defined in Section 4 hereof), between the Company and Wells Fargo
Bank, N.A., as trustee (the "Trustee"). Capitalized terms used but not defined
herein shall have the meanings given to such terms in the Offering Circular (as
defined below).
1. The Company represents and warrants to, and agrees with, each of the
Purchasers that:
(a) A preliminary offering circular, dated June 28, 2004 (the
"Preliminary Offering Circular") and an offering circular, dated June 28,
2004 (the "Offering Circular", in each case including the Company's Annual
Report on Form 10-K for the fiscal year ended December 31, 2003 and
Quarterly Report on Form 10-Q for the quarter ended March 31, 2004, which
are attached to and made a part of the Preliminary Offering Circular and
the Offering Circular), have been prepared in connection with the offering
of the Securities and shares of the Stock issuable upon conversion
thereof. Any reference to the Preliminary Offering Circular or the
Offering Circular shall be deemed to refer to and include the Company's
most recent Annual Report on Form 10-K and all subsequent documents filed
with the United States Securities and Exchange Commission (the
"Commission") pursuant to Section 13(a), 13(c) or 15(d) of the United
States Securities Exchange Act of 1934, as amended (the "Exchange Act")
(excluding information furnished under Item 9 or Item 12 of any current
report on Form 8-K) on or
prior to the date of the Preliminary Offering Circular or the Offering
Circular, as the case may be, and any reference to the Preliminary
Offering Circular or the Offering Circular, as the case may be, as amended
or supplemented, as of any specified date, shall be deemed to include any
documents filed with the Commission pursuant to Section 13(a), 13(c) or
15(d) of the Exchange Act after the date of the Preliminary Offering
Circular or the Offering Circular, as the case may be; and all documents
filed under the Exchange Act and so deemed to be included in the
Preliminary Offering Circular or the Offering Circular, as the case may
be, or any amendment or supplement thereto are hereinafter called the
"Exchange Act Reports". The Exchange Act Reports, when they were or are
filed with the Commission, conformed or will conform, as the case may be,
in all material respects to the applicable requirements of the Exchange
Act and the applicable rules and regulations of the Commission thereunder.
The Preliminary Offering Circular or the Offering Circular and any
amendments or supplements thereto insofar as such amendments or
supplements are incorporated into the Offering Circular and the Exchange
Act Reports did not and will not, as of their respective dates, contain an
untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided,
however, that this representation and warranty shall not apply to, and the
Company makes no representation or warranty with respect to, any
statements or omissions made in reliance upon and in conformity with
information furnished in writing to the Company by a Purchaser through
Goldman, Sachs & Co. expressly for use therein;
(b) Neither the Company nor any of its subsidiaries has sustained
since the date of the latest audited financial statements included in the
Offering Circular any loss or interference with its business that is
material to the Company and its subsidiaries taken as a whole from fire,
explosion, flood or other calamity, whether or not covered by insurance,
or from any labor dispute or court or governmental action, order or
decree, except as set forth or contemplated in the Offering Circular; and,
since the respective dates as of which information is given in the
Offering Circular, there has not been any change in the capital stock
(other than issuances pursuant to equity incentive plans) or increase in
long-term debt of the Company or any of its subsidiaries, or any material
adverse change, or any development involving a prospective material
adverse change, in or affecting the business, properties, financial
position or results of operations of the Company and its subsidiaries
taken as a whole, except as set forth or contemplated in the Offering
Circular. As used in this Agreement, a "subsidiary" of any person means
any corporation, association, partnership or other business entity of
which more than 50% of the total voting power of shares of capital stock
or other interests (including partnership interests) entitled (without
regard to the occurrence of any contingency) to vote in the election of
directors, managers or trustees thereof is at the time owned or
controlled, directly or indirectly, by: (i) such person, (ii) such person
and one or more subsidiaries of such person or (iii) one or more
subsidiaries of such person.
(c) The Company and its subsidiaries have good and marketable title
in fee simple to all real property and good and marketable title to all
personal property owned by them, in each case free and clear of all liens,
encumbrances and defects except (i) such as are described in the Offering
Circular or (ii) such as do not 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 and its subsidiaries or (iii) such as could
not reasonably be expected, individually or in the aggregate, to have a
material adverse effect on the business, properties, financial position or
results of operations of the
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Company and its subsidiaries taken as a whole or on the performance by the
Company of its obligations under the Securities (a "Material Adverse
Effect"); and any real property and buildings held under lease by the
Company and its subsidiaries are held by them under valid, subsisting and
enforceable leases with such exceptions as are not material and do not
interfere with the use made and proposed to be made of such property and
buildings by the Company and its subsidiaries taken as a whole in any
material respect;
(d) The Company and its subsidiaries own, license or otherwise
possess adequate rights to use all material patents, patent applications,
trademarks, service marks, trade names, trademark registrations, service
mark registrations, copyrights, licenses and know-how (including trade
secrets and other unpatented and/or unpatentable proprietary or
confidential information, systems or procedures) necessary for the conduct
of their respective businesses, except where the failure to own, license
or otherwise possess such rights would not reasonably be expected to have
a Material Adverse Effect; and the conduct of their respective businesses
will not conflict in any respect with any such rights of others, and the
Company and, to the best of the Company's knowledge, its subsidiaries,
have not received written notice of any claim of infringement of or
conflict with any such rights of others, except such conflicts or
infringements that, if adversely determined against the Company or any of
its subsidiaries, would not reasonably be expected to have a Material
Adverse Effect.
(e) The financial statements and the related notes thereto included
in the Offering Circular present fairly in all material respects the
consolidated financial position of the Company and its consolidated
subsidiaries as of the dates indicated and the results of their operations
and the changes in their cash flows for the periods specified, in each
case, on a consolidated basis; such financial statements have been
prepared in conformity with United States generally accepted accounting
principles applied on a consistent basis throughout the periods covered
thereby; and the other financial information included or incorporated by
reference in the Offering Circular has been derived from the accounting
records of the Company and its subsidiaries and presents fairly in all
material respects the information shown thereby.
(f) Since the date of the latest audited financial statements of the
Company included in the Offering Circular, neither the Company nor any of
its subsidiaries has entered into any transaction or agreement that is
material to the Company and its subsidiaries taken as a whole or incurred
any liability or obligation, direct or contingent, that is material to the
Company and its subsidiaries taken as a whole, other than as set forth in
the Offering Circular.
(g) The Company has been duly incorporated and is validly existing
as a corporation in good standing under the laws of the State of Ohio,
with all requisite power and authority (corporate and other) necessary to
own its properties and conduct its business as described in the Offering
Circular, and has been duly qualified as a foreign corporation for the
transaction of business and is in good standing under the laws of each
other jurisdiction in which it owns or leases properties or conducts any
business so as to require such qualification, or is subject to no
liability or disability that is material to the Company and its
subsidiaries taken as a whole by reason of the failure to be so qualified
or in good standing in any such jurisdiction;
(h) The Company has an authorized capitalization as set forth in the
Offering Circular, and all of the issued shares of capital stock of the
Company have been duly
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and validly authorized and issued and are fully paid and non-assessable;
the shares of Stock initially issuable upon conversion of the Securities
have been duly and validly authorized and reserved for issuance and, when
issued and delivered in accordance with the provisions of the Securities
and the Indenture referred to below, will be duly and validly issued,
fully paid and non-assessable and will conform in all material respects to
the description of the Stock contained in the Offering Circular; and all
of the issued shares of capital stock or other equity interests of each
significant subsidiary (for purposes of this Section, as defined in Rule
1.02 of Regulation S-X under the Exchange Act) of the Company have been
duly and validly authorized and issued, are fully paid and non-assessable
and (except for directors' qualifying shares and except as otherwise set
forth in the Offering Circular) are owned directly or indirectly by the
Company, free and clear of any lien, charge, encumbrance, security
interest, restriction on voting or transfer or any other claim of any
third party other than those which are "Permitted Liens" as defined in the
Indenture, dated as of March 12, 2004, between the Company and Wells Fargo
Bank, N.A., as trustee, with respect to the Company's 11% Senior Secured
Notes due 2011 and Senior Secured Floating Rate Notes due 2011. Except as
described in the Offering Circular, there are no outstanding
subscriptions, rights, warrants, calls or options to acquire, or
instruments convertible into or exchangeable for, or agreements or
understandings with respect to the sale or issuance of, any shares of
capital stock of or other equity or other ownership interest in the
Company or any of its significant subsidiaries;
(i) The Company has full right, power and authority to execute and
deliver this Agreement, the Securities, the Indenture and the Registration
Rights Agreement dated the date of the First Time of Delivery, between the
Company and the Purchasers therein (the "Registration Rights Agreement"
and together with this Agreement, the Securities and the Indenture, the
"Transaction Documents") and to perform their respective obligations
hereunder and thereunder; and all action required to be taken for the due
and proper authorization, execution and delivery of each of the
Transaction Documents and the consummation of the transactions
contemplated thereby has been duly and validly taken.
(j) The Securities have been duly authorized and, when issued and
delivered and paid for pursuant to this Agreement, will have been duly
executed, authenticated, issued and delivered and will constitute valid
and legally binding obligations of the Company enforceable in accordance
with their terms, subject, as to enforcement, to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and other laws of general
applicability relating to or affecting creditors' rights and to general
equity principles regardless of whether considered in a proceeding in
equity or at law (collectively, the "Enforceability Exceptions"), and
entitled to the benefits provided by the Indenture under which they are to
be issued to you; the Indenture has been duly authorized and, when
executed and delivered by the Company and the Trustee, the Indenture will
constitute a valid and legally binding instrument, enforceable in
accordance with its terms, subject to the Enforceability Exceptions; and
the Securities and the Indenture will conform to the descriptions thereof
in the Offering Circular and will be in substantially the form previously
delivered to you;
(k) This Agreement has been duly authorized, executed and delivered
by the Company; and the Registration Rights Agreement has been duly
authorized by the Company and, when duly executed and delivered in
accordance with its terms by each of the parties thereto, will constitute
a valid and legally binding agreement of the
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Company enforceable against the Company in accordance with its terms,
subject to the Enforceability Exceptions, and except that rights to
indemnity and contribution thereunder may be limited by applicable law and
public policy. There are no other persons with registration rights or
similar rights to have any securities of the Company ((i) other than the
Securities and (ii) the Company's 11% Senior Secured Notes due 2011 and
Senior Secured Floating Rate Notes due 2011 (collectively, the "Senior
Secured Notes")) registered under a registration statement filed pursuant
to Rule 415 under the Act.
(l) None of the transactions contemplated by this Agreement
(including, without limitation, the use of the proceeds from the sale of
the Securities as described in the Offering Circular) will violate or
result in a violation of Section 7 of the Exchange Act, or any regulation
promulgated thereunder, including, without limitation, Regulations T, U,
and X of the Board of Governors of the Federal Reserve System;
(m) Prior to the date hereof, neither the Company nor any of its
affiliates (as defined in Rule 144 under the Act) has taken any action
which is designed to or which has constituted or which might have been
expected to cause or result in stabilization or manipulation of the price
of any security of the Company in connection with the offering of the
Securities;
(n) The execution, delivery and performance by the Company of each
of the Transaction Documents, the issuance and sale of the Securities and
the compliance by the Company with all of the provisions of the
Transaction Documents, and the consummation of the transactions herein and
therein contemplated will not (i) conflict with or result in a breach or
violation of any of the terms or provisions of, or constitute a default
under, any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which the Company or any of its subsidiaries is
a party or by which the Company or any of its subsidiaries is bound or to
which any of the property or assets of the Company or any of its
subsidiaries is subject, (ii) result in any violation of the provisions of
the Certificate of Incorporation or By-laws of the Company or (iii) result
in any violation of any law or statute or any judgment, order, rule or
regulation of any court or governmental agency or body having jurisdiction
over the Company or any of its subsidiaries or any of their properties or
assets, except, in the case of clauses (i) and (iii) above, for any such
conflict, breach or violation that would not, individually or in the
aggregate, have a Material Adverse Effect; and no consent, approval,
authorization, order, registration or qualification of or with any such
court or governmental agency or body is required for the issue and sale of
the Securities or the consummation by the Company of the transactions
contemplated by the Transaction Documents, except for (i) such consents,
approvals, authorizations, registrations or qualifications as may be
required under state securities or Blue Sky laws in connection with the
purchase and resale of the Securities by the Purchasers and (ii) the
filing of a registration statement pursuant to Rule 415 under the Act by
the Company with the Commission pursuant to the Registration Rights
Agreement;
(o) Neither the Company nor any of its subsidiaries is (i) in
violation of its Certificate of Incorporation or By-laws or (ii) in
default in the performance or observance of any obligation, covenant or
condition contained in any indenture, mortgage, deed of trust, loan
agreement, lease or other agreement or instrument to which it is a party
or by which it or any of its properties may be bound, except, in the case
of clause (ii), for any default that would not, individually or in the
aggregate, have a Material Adverse Effect;
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(p) The statements set forth in the Offering Circular under the
caption "Description of the Notes" and "Description of Capital Stock",
insofar as they purport to constitute a summary of the terms of the
Securities and the Stock, and under the caption "Certain United States
Federal Income Tax Considerations", insofar as they purport to describe
the provisions of the laws and documents referred to therein, are
accurate, complete and fair in all material respects;
(q) Other than as set forth in the Offering Circular, there are no
legal or governmental proceedings pending to which the Company or any of
its subsidiaries is a party or to which any property of the Company or any
of its subsidiaries is the subject, which would be required to be
disclosed in the Company's Annual Report on Form 10-K if such report were
filed on the date hereof; and, to the best of the Company's knowledge, no
such proceedings are threatened or contemplated by governmental
authorities or threatened by others;
(r) When the Securities are issued and delivered pursuant to this
Agreement, the Securities will not be of the same class (within the
meaning of Rule 144A under the Securities Act of 1933, as amended (the
"Act")) as securities which are listed on a national securities exchange
registered under Section 6 of the Exchange Act or quoted in a U.S.
automated inter-dealer quotation system;
(s) The Company is subject to Section 13 or 15(d) of the Exchange
Act;
(t) The Company is not, and after giving effect to the offering and
sale of the Securities, will not be an "investment company", as such term
is defined in the United States Investment Company Act of 1940, as amended
(the "Investment Company Act");
(u) Neither the Company, nor any person acting on its or their
behalf has offered or sold the Securities by means of any general
solicitation or general advertising within the meaning of Rule 502(c)
under the Act;
(v) Within the preceding six months, neither the Company nor any
other person acting on behalf of the Company has offered or sold to any
person any Securities, or any securities of the same or a similar class as
the Securities, other than Securities offered or sold to the Purchasers
hereunder or the issuance of the Company's Senior Secured Notes. The
Company will take reasonable precautions designed to insure that any offer
or sale, direct or indirect, in the United States or to any U.S. person
(as defined in Rule 902 under the Act) of any Securities or any
substantially similar security issued by the Company, within six months
subsequent to the date on which the distribution of the Securities has
been completed (as notified to the Company by the Purchasers), is made
under restrictions and other circumstances reasonably designed not to
affect the status of the offer and sale of the Securities in the United
States and to U.S. persons contemplated by this Agreement as transactions
exempt from the registration provisions of the Act; and
(w) PricewaterhouseCoopers LLP, who have certified certain
consolidated financial statements of the Company and its consolidated
subsidiaries, are independent public accountants as required by the Act
and the rules and regulations of the Commission thereunder.
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(x) The Company and its subsidiaries have paid all federal, state,
local and foreign taxes (except for such taxes that are not yet delinquent
or that are being contested in good faith and by proper proceedings) and
filed all tax returns required to be paid or filed through the date
hereof, except in each case where the failure to pay or file would not
reasonably be expected to have a Material Adverse Effect; and except as
otherwise disclosed in the Offering Circular or as would not reasonably be
expected to have a Material Adverse Effect, there is no tax deficiency
that has been, or could reasonably be expected to be, asserted against the
Company or any of its subsidiaries or any of their respective properties
or assets.
(y) The Company and its subsidiaries possess all licenses,
certificates, permits and other authorizations issued by, and have made
all declarations and filings with, the appropriate federal, state, local
or foreign governmental or regulatory authorities that are necessary for
the ownership or lease of their respective properties or the conduct of
their respective businesses as described in the Offering Circular, except
where the failure to possess or make the same would not, individually or
in the aggregate, have a Material Adverse Effect; and except as described
in the Offering Circular or as would not reasonably be expected to have a
Material Adverse Effect, neither the Company nor any of its subsidiaries
has received written notice of any revocation or modification of any such
license, certificate, permit or authorization or has any reason to believe
that any such license, certificate, permit or authorization will not be
renewed in the ordinary course.
(z) Except as described in the Offering Circular, no labor
disturbance by or dispute with employees of the Company or any of its
subsidiaries exists or, to the best knowledge of the Company, is
contemplated or threatened, in each case that would be reasonably expected
to have a Material Adverse Effect.
(aa) The Company and its subsidiaries (i) are in compliance with any
and all applicable federal, state, local and foreign laws, rules,
regulations, decisions and orders relating to the protection of human
health and safety, the environment or hazardous or toxic substances or
wastes, pollutants or contaminants (collectively, "Environmental Laws");
(ii) have received and are in compliance with all permits, licenses or
other approvals required of them under applicable Environmental Laws to
conduct their respective businesses; and (iii) have not received notice of
any actual or potential liability for the investigation or remediation of
any disposal or release of hazardous or toxic substances or wastes,
pollutants or contaminants, except in any such case for any such failure
to comply with, or failure to receive required permits, licenses or
approvals, or liability, as would not, individually or in the aggregate,
have a Material Adverse Effect.
(bb) Except as would not reasonably be expected to have a Material
Adverse Effect, each employee benefit plan, within the meaning of Section
3(3) of the Employee Retirement Income Security Act of 1974, as amended
("ERISA"), that is maintained, administered or contributed to by the
Company or any of its affiliates for employees or former employees of the
Company and its affiliates is in compliance in all material respects with
its terms and the requirements of any applicable statutes, orders, rules
and regulations, including but not limited to ERISA and the Internal
Revenue Code of 1986, as amended (the "Code"); no prohibited transaction,
within the meaning of Section 406 of ERISA or Section 4975 of the Code,
has occurred with respect to any such plan excluding transactions effected
pursuant to a statutory or administrative exemption; and for each such
plan that is subject to the funding rules of Section 412 of the Code or
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Section 302 of ERISA, except as set forth in the Preliminary Offering
Circular or the Offering Circular, the fair market value of the assets of
each such plan (excluding for these purposes accrued but unpaid
contributions) exceeds the present value of all benefits accrued under
such plan determined using reasonable actuarial assumptions, and no
"accumulated funding deficiency" as defined in Section 412 of the Code has
been incurred, whether or not waived.
(cc) Except as would not reasonably be expected to have a Material
Adverse Effect, the Company and its subsidiaries maintain systems of
internal accounting controls sufficient to provide reasonable assurance
that (i) transactions are executed in accordance with management's general
or specific authorizations; (ii) transactions are recorded as necessary to
permit preparation of financial statements in conformity with generally
accepted accounting principles and to maintain asset accountability; (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 differences. The foregoing
is subject to the disclosures set forth in Note 2 to the Notes to the
Financial Statements and Item 9A, in each case, of the Company's Annual
Report on Form 10-K for the fiscal year ended December 31, 2003, and Item
4 of the Company's Quarterly Report on Form 10-Q for the quarter ended
March 31, 2004.
(dd) Except as would not reasonably be expected to have a Material
Adverse Effect, the Company and its subsidiaries have insurance covering
their respective properties, operations, personnel and businesses,
including business interruption insurance, which insurance is in amounts
and insures against such losses and risks as are customary among companies
of established reputation engaged in the same or similar businesses and
operating in the same or similar locations; and neither the Company nor,
to the best of the Company's knowledge, any of its subsidiaries, has (i)
received written notice from any insurer or agent of such insurer that
capital improvements or other expenditures are required or necessary to be
made in order to continue such insurance or (ii) any reason to believe
that it will not be able to renew its existing insurance coverage as and
when such coverage expires or to obtain similar coverage at reasonable
cost from similar insurers as may be necessary to continue its business.
(ee) Except as would not reasonably be expected to have a Material
Adverse Effect, neither the Company nor any of its subsidiaries nor, to
the best knowledge of the Company, any director, officer, agent, employee
or other person associated with or acting on behalf of the Company or any
of its subsidiaries has (i) used any corporate funds for any unlawful
contribution, gift, entertainment or other unlawful expense relating to
political activity; (ii) made any direct or indirect unlawful payment to
any foreign or domestic government official or employee from corporate
funds; (iii) violated or is in violation of any provision of the Foreign
Corrupt Practices Act of 1977; or (iv) made any bribe, rebate, payoff,
influence payment, kickback or other unlawful payment.
(ff) On the First Time of Delivery, the Company (after giving effect
to the issuance of the Securities and the other transactions related
thereto as described in the Offering Circular) will be Solvent. As used in
this paragraph, the term "Solvent" means, with respect to a particular
date, that on such date (i) the present fair market value (or present fair
saleable value) of the assets of the Company is not less than the total
amount required to pay the liabilities of the Company on its total
existing debts and
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liabilities (including contingent liabilities) (which liabilities are
calculated for purposes of this representation in the manner used in the
preparation of the Company's consolidated financial statements) as they
become absolute and matured; (ii) the Company is able to realize upon its
assets and pay its debts and other liabilities, contingent obligations and
commitments as they mature and become due in the normal course of business
(assuming the ability to refinance existing obligations in the normal
course of business); (iii) assuming consummation of the issuance of the
Securities as contemplated by this Agreement and the Offering Circular,
the Company is not incurring debts or liabilities beyond its ability to
pay as such debts and liabilities mature; and (iv) the Company is not
engaged in any business or transaction, and does not propose to engage in
any business or transaction, for which its property would constitute
unreasonably small capital after giving due consideration to the
prevailing practice in the industry in which the Company is engaged.
(gg) Neither the Company nor any of its affiliates (as defined in
Rule 501(b) of Regulation D of the Act) has, directly or through any
agent, sold, offered for sale, solicited offers to buy or otherwise
negotiated in respect of, any security (as defined in the Act), that is or
will be integrated with the sale of the Securities or the Stock in a
manner that would require registration of the Securities under the Act.
(hh) Assuming the accuracy of the representations and warranties of
the Purchasers contained in Section 3 and their compliance with their
agreements set forth therein, it is not necessary, in connection with the
issuance and sale of the Securities to the Purchasers, the offer, resale
and delivery of the Securities by the Purchasers and the conversion of the
Securities into Stock, in each case in the manner contemplated by this
Agreement and the Offering Circular, to register the Securities under the
Act or to qualify the Indenture under the Trust Indenture Act of 1939, as
amended.
(ii) Each executive officer of the Company listed on Schedule 2
hereto has entered into a written agreement in the form of Annex II hereto
(each such agreement, a "Lock-Up Agreement"), and executed originals of
each Lock-Up Agreement have been delivered to you.
2. Subject to the terms and conditions herein set forth, (a) the Company
agrees to issue and sell to each of the Purchasers, and each of the Purchasers
agrees, severally and not jointly, to purchase from the Company, at a purchase
price of 97.25% of the principal amount thereof, the principal amount of Firm
Securities set forth opposite the name of such Purchaser in Schedule I hereto,
and (b) in the event and to the extent that the Purchasers shall exercise the
election to purchase Optional Securities as provided below, the Company agrees
to issue and sell to each of the Purchasers, and each of the Purchasers agrees,
severally and not jointly, to purchase from the Company, at the same purchase
price set forth in clause (a) of this Section 2, that portion of the aggregate
principal amount of the Optional Securities as to which such election shall have
been exercised (to be adjusted by you so as to eliminate fractions of $1,000)
determined by multiplying such aggregate principal amount of Optional Securities
by a fraction, the numerator of which is the maximum aggregate principal amount
of Optional Securities which such Purchaser is entitled to purchase as set forth
opposite the name of such Purchaser in Schedule I hereto and the denominator of
which is the maximum aggregate principal amount of Optional Securities which all
of the Purchasers are entitled to purchase hereunder.
The Company hereby grants to the Purchasers the right to purchase at their
election up to $50,000,000 aggregate principal amount of Optional Securities, at
the purchase price set
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forth in clause (a) of the first paragraph of this Section 2. Any such election
to purchase Optional Securities may be exercised by written notice from you to
the Company, given within a period of 30 calendar days after the date of this
Agreement, setting forth (i) the aggregate principal amount of Optional
Securities to be purchased (which shall be an integral multiple of $1,000), (ii)
the names and denominations in which the Optional Securities are to be
registered and (iii) the time, date and place at which such Optional Securities
are to be delivered, as determined by you but in no event earlier than the First
Time of Delivery or, unless you and the Company otherwise agree in writing,
earlier than two or later than ten business days after the date of such notice.
Notwithstanding anything to the contrary contained herein, the Purchasers
may not exercise their election to purchase Optional Securities, in whole or in
part, after the period which ends 13 days after the issue date if the Optional
Securities would be treated as having been issued with "original issue discount"
for purposes of Sections 1271-1275 of the Internal Revenue Code and the
applicable Treasury regulations promulgated thereunder.
3. Upon the authorization by you of the release of the Securities, the
several Purchasers propose to offer the Securities for sale upon the terms and
conditions set forth in this Agreement and the Offering Circular and each
Purchaser hereby represents and warrants to, and agrees with the Company that:
(a) It will offer and sell the Securities only to persons who it
reasonably believes are "qualified institutional buyers" ("QIBs") within the
meaning of Rule 144A under the Act in transactions meeting the requirements of
Rule 144A;
(b) It is an institutional accredited investor within the meaning of Rule
501(a) under the Act;
(c) It will not offer or sell the Securities by any form of general
solicitation or general advertising, including but not limited to the methods
described in Rule 502(c) under the Act; and
(d) It acknowledges that the Securities have not been registered under the
Act and may not be sold within the United States except pursuant to an exemption
from, or in a transaction not subject to, the registration requirements of the
Act.
4. (a) The Securities to be purchased by each Purchaser hereunder will be
represented by one or more definitive global Securities in book-entry form which
will be deposited by or on behalf of the Company with The Depository Trust
Company ("DTC") or its designated custodian. The Company will deliver the
applicable Securities to Goldman, Sachs & Co., for the account of each
Purchaser, against payment by or on behalf of such Purchaser of the purchase
price therefor by certified or official bank check or checks, payable to the
order of the Company in New York Clearing House (next day) funds, by causing DTC
to credit the Securities to the account of Goldman, Sachs & Co. at DTC. The
Company will cause the form of certificates representing the applicable
Securities to be made available to Goldman, Sachs & Co. for checking at least
twenty-four hours prior to the applicable Time of Delivery (as defined below) at
the office of DTC or its designated custodian (the "Designated Office"). The
time and date of such delivery and payment shall be, with respect to the Firm
Securities, 9:30 a.m., New York City time, on July 2, 2004 or such other time
and date as Goldman, Sachs & Co. and the Company may agree upon in writing, and,
with respect to the Optional Securities, 9:30 a.m., New York City time, on the
date specified by Goldman, Sachs & Co. in the written notice given by Goldman,
Sachs & Co. of the Purchasers' election to purchase such Optional Securities, or
10
such other time and date as Goldman, Sachs & Co. and the Company may agree upon
in writing. Such time and date for delivery of the Firm Securities is herein
called the "First Time of Delivery", such time and date for delivery of the
Optional Securities, if not the First Time of Delivery, is herein called the
"Second Time of Delivery", and each such time and date for delivery is herein
called a "Time of Delivery".
(b) The documents to be delivered at the Time of Delivery by or on behalf
of the parties hereto pursuant to Section 7 hereof, including the cross-receipt
for the Securities and any additional documents requested by the Purchasers
pursuant to Section 7(i) hereof, will be delivered at such time and date at the
offices of Covington & Burling, 1330 Avenue of the Americas, New York, NY 10019
(the "Closing Location"), and the Securities will be delivered at the Designated
Office, all at the Time of Delivery. A meeting will be held at the Closing
Location at 4:00 p.m., New York City time, on the New York Business Day next
preceding the Time of Delivery, at which meeting the final drafts of the
documents to be delivered pursuant to the preceding sentence will be available
for review by the parties hereto. For the purposes of this Section 4, "New York
Business Day" shall mean each Monday, Tuesday, Wednesday, Thursday and Friday
which is not a day on which banking institutions in New York are generally
authorized or obligated by law or executive order to close.
5. The Company agrees with each of the Purchasers:
(a) To prepare the Offering Circular in a form approved by you; to make no
amendment or any supplement to the Offering Circular which shall be disapproved
by you promptly after reasonable notice thereof; and to furnish you with copies
thereof;
(b) Promptly from time to time to take such action as you may reasonably
request to qualify the Securities and the shares of Stock issuable upon
conversion of the Securities for offering and sale under the securities laws of
such jurisdictions as you may request and to comply with such laws so as to
permit the continuance of sales and dealings therein in such jurisdictions for
as long as may be necessary to complete the offering and resale of the
Securities, provided that in connection therewith the Company shall not be
required (i) to qualify as a foreign corporation or (ii) to file a general
consent to service of process in any jurisdiction or (iii) to take any action
that would subject itself to taxation in any jurisdiction if it is not otherwise
so subject;
(c) To furnish the Purchasers with 3 copies of the Offering Circular and
each amendment or supplement thereto signed by an authorized officer of the
Company with the independent accountants' report(s) in the Offering Circular,
and any amendment or supplement containing amendments to the financial
statements covered by such report(s), signed by the accountants, and additional
written and electronic copies thereof in such quantities as you may from time to
time reasonably request, and if, at any time prior to the earlier of (i) the
expiration of nine months after the date of the Offering Circular and (ii)
completion of the resale of the Securities by the Purchasers, any event shall
have occurred as a result of which the Offering Circular as then amended or
supplemented would include an untrue statement of a material fact or omit to
state any material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made when such Offering
Circular is delivered, not misleading, or, if for any other reason it shall be
necessary or desirable (as determined by the Company) during such same period to
amend or supplement the Offering Circular, to notify you and upon your request
to prepare and furnish without charge to each Purchaser and to any dealer in
securities as many written and electronic copies as you may from time to time
11
reasonably request of an amended Offering Circular or a supplement to the
Offering Circular which will correct such statement or omission or effect such
compliance;
(d) To advise the Purchasers promptly, and confirm such advice in writing,
(i) of the issuance by any governmental or regulatory authority of any order
preventing or suspending the use of the Offering Circular or the initiation or
threatening of any proceeding for that purpose and (ii) of the receipt by the
Company of any notice with respect to any suspension of the qualification of the
Securities for offer and sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose; and the Company will use its
commercially reasonable efforts to prevent the issuance of any such order
preventing or suspending the use of the Offering Circular or suspending any such
qualification of the Securities and, if any such order is issued, will obtain as
soon as possible the withdrawal thereof;
(e) During the period beginning from the date hereof and continuing until
the date 90 days after the First Time of Delivery, not to offer, sell, contract
to sell or otherwise dispose of, except as provided hereunder any securities of
the Company that are substantially similar to the Securities or the Stock,
including but not limited to any securities that are convertible into or
exchangeable for, or that represent the right to receive, Stock or any such
substantially similar securities (other than pursuant to employee stock option
plans existing on, or upon the conversion or exchange of convertible or
exchangeable securities outstanding as of, the date of this Agreement), without
your prior written consent;
(f) Not to be or become, at any time prior to the expiration of two years
after the First Time of Delivery, an open-end investment company, unit
investment trust, closed-end investment company or face-amount certificate
company that is or is required to be registered under Section 8 of the
Investment Company Act;
(g) So long as the Securities or the Stock issuable upon conversion of the
Securities remain outstanding and are "restricted securities" within the meaning
of Rule 144(a)(3) under the Act, at any time when the Company is not subject to
Section 13 or 15(d) of the Exchange Act, for the benefit of holders from time to
time of Securities, to furnish at its expense, upon request, to holders of
Securities and prospective purchasers of Securities information (the "Additional
Issuer Information") satisfying the requirements of subsection (d)(4)(i) of Rule
144A under the Act;
(h) If requested by you, to use its best efforts to cause the Securities
to be eligible for the PORTAL trading system of the National Association of
Securities Dealers, Inc. and for clearance and settlement through the Depository
Trust Company;
(i) Except if such information is available on the website of either the
Company or the Commission, to furnish to the holders of the Securities as soon
as practicable after the end of each fiscal year an annual report (including a
balance sheet and statements of income, shareholders' equity and cash flows of
the Company and its consolidated subsidiaries certified by independent public
accountants) and, as soon as practicable after the end of each of the first
three quarters of each fiscal year (beginning with the fiscal quarter ending
after the date of the Offering Circular), to make available to its shareholders
consolidated summary financial information of the Company and its subsidiaries
for such quarter in reasonable detail;
(j) During a period of two years from the date of the Offering Circular,
to furnish to you copies of all reports or other communications (financial or
other) furnished to shareholders of the Company, and to deliver to you (i) as
soon as they are available, copies of any reports
12
and financial statements furnished to or filed with the Commission or any
securities exchange on which the Securities or any class of securities of the
Company is listed; and (ii) such additional information concerning the business
and financial condition of the Company as you may from time to time reasonably
request (such financial statements to be on a consolidated basis to the extent
the accounts of the Company and its subsidiaries are consolidated in reports
furnished to its shareholders generally or to the Commission);
(k) During the period of two years after the First Time of Delivery, not
to, and not permit any of its "affiliates" (as defined in Rule 144 under the
Act) to, resell any of the Securities which constitute "restricted securities"
under Rule 144 that have been reacquired by any of them, except for Securities
or Stock issuable upon conversion of the Securities purchased by the Company or
any of its affiliates and resold in a transaction registered under the Act;
(l) To use the net proceeds received by it from the sale of the Securities
pursuant to this Agreement in the manner specified in the Offering Circular
under the caption "Use of Proceeds";
(m) To reserve and keep available at all times, free of preemptive rights,
shares of Stock for the purpose of enabling the Company to satisfy any
obligations to issue shares of its Stock upon conversion of the Securities under
the terms of the Indenture; and
(n) To not, and not permit any of its affiliates (as defined in Rule
501(b) of Regulation D) to, directly or through any agent, sell, offer for sale,
solicit offers to buy or otherwise negotiate in respect of, any security (as
defined in the Act), that is or will be integrated with the sale of the
Securities in a manner that would require registration of the Securities under
the Act.
(o) To not, and not permit any of its affiliates or any other person
acting on its or their behalf (other than the Initial Purchasers, as to which no
covenant is given) solicit offers for, or offer or sell, the Securities by means
of any form of general solicitation or general advertising within the meaning of
Rule 502(c) of Regulation D or in any manner involving a public offering within
the meaning of Section 4(2) of the Act.
(p) To not take, directly or indirectly, any action designed to or that
could reasonably be expected to cause or result in any stabilization or
manipulation of the price of the Securities.
(q) To file a "Supplemental Listing Application of Additional Shares" and
any required supporting documentation relating to the shares of Stock issuable
upon conversion of the Securities with the New York Stock Exchange, and cause
such shares of Stock to be duly listed on the New York Stock Exchange, subject
to notice of issuance.
6. The Company covenants and agrees with the several Purchasers that the
Company will pay or cause to be paid the following: (i) the fees, disbursements
and expenses of the Company's counsel and accountants in connection with the
issuance of the Securities and the shares of Stock issuable upon conversion of
the Securities and all other expenses in connection with the preparation,
printing and filing of the Preliminary Offering Circular and the Offering
Circular and any amendments and supplements thereto and the mailing and
delivering of copies thereof to the Purchasers and dealers; (ii) the cost of
printing or producing this Agreement, the Registration Rights Agreement, the
Indenture, the Blue Sky and Legal Investment Memoranda, closing documents
(including any compilations thereof) and any other documents in connection with
the offering, purchase, sale and delivery of the Securities; (iii) all expenses
in connection with the qualification of the Securities and the shares of Stock
issuable
13
upon conversion of the Securities for offering and sale under state securities
laws as provided in Section 5(b) hereof, including the fees and disbursements of
counsel for the Purchasers in connection with such qualification and in
connection with the Blue Sky and legal investment surveys; (iv) any fees charged
by securities rating services for rating the Securities; (v) the cost of
preparing the Securities; (vi) the fees and expenses of the Trustee and any
agent of the Trustee and the fees and disbursements of counsel for the Trustee
in connection with the Indenture and the Securities; (vii) any cost incurred in
connection with the designation of the Securities for trading in PORTAL and the
listing of the shares of Stock issuable upon conversion of the Securities on the
New York Stock Exchange; and (viii) all other costs and expenses incident to the
performance of its obligations hereunder which are not otherwise specifically
provided for in this Section. It is understood, however, that, except as
provided in this Section, and Sections 8 and 11 hereof, the Purchasers will pay
all of their own costs and expenses, including the fees of their counsel,
transfer taxes on resale of any of the Securities by them, and any advertising
expenses connected with any offers they may make.
7. The obligations of the Purchasers hereunder shall be subject, in their
discretion, to the condition that all representations and warranties and other
statements of the Company herein are, at and as of each Time of Delivery, as
applicable, true and correct, the condition that the Company shall have
performed all of its obligations hereunder theretofore to be performed, and the
following additional conditions:
(a) Cravath, Swaine & Moore LLP, counsel for the Purchasers, shall have
furnished to you such opinion or opinions, dated the Time of Delivery, as
applicable, with respect to such matters as you may reasonably request, and such
counsel shall have received such papers and information as they may reasonably
request to enable them to pass upon such matters;
(b) Bertram Bell, Esq., Associate General Counsel and Assistant Secretary
of the Company and Covington & Burling, counsel for the Company, shall have
furnished to you their written opinion, dated the Time of Delivery in form and
substance satisfactory to you, substantially in the forms set forth in Annex I
hereto;
(c) On the date of the Offering Circular prior to the execution of this
Agreement and also at the Time of Delivery, PricewaterhouseCoopers LLP shall
have furnished to you a letter or letters, dated the respective dates of
delivery thereof, in form and substance satisfactory to you, substantially in
the form set forth in Annex III hereto;
(d) (i) Neither the Company nor any of its subsidiaries shall have
sustained since the date of the latest audited financial statements included in
the Offering Circular any loss or interference with the business of Company and
its subsidiaries taken as a whole from fire, explosion, flood or other calamity,
whether or not covered by insurance, or from any labor dispute or court or
governmental action, order or decree, except as set forth or contemplated in the
Offering Circular, and (ii) since the respective dates as of which information
is given in the Offering Circular there shall not have been any change in the
capital stock (other than issuances pursuant to equity incentive plans) or
increase in long-term debt of the Company or any of its subsidiaries or any
change, or any development involving a prospective change, in or affecting the
business, properties, financial position or results of operations of the Company
and its subsidiaries taken as a whole, except as set forth or contemplated in
the Offering Circular, the effect of which, in any such case described in clause
(i) or (ii), is in the judgment of the Purchasers so material and adverse as to
make it impracticable or inadvisable to proceed with the public offering or the
delivery of the Securities on the terms and in the manner contemplated in this
Agreement and the Offering Circular;
14
(e) On or after the date hereof (i) no downgrading shall have occurred in
the rating accorded the Company's debt securities by any "nationally recognized
statistical rating organization", as that term is defined by the Commission for
purposes of Rule 436(g)(2) under the Act, and (ii) no such organization shall
have publicly announced that it has under surveillance or review, with possible
negative implications, its rating of any of the Company's debt securities;
(f) On or after the date hereof there shall not have occurred any of the
following: (i) a suspension or material limitation in trading in securities
generally on the New York Stock Exchange; (ii) a suspension or material
limitation in trading in the Company's securities on the New York Stock
Exchange; (iii) a general moratorium on commercial banking activities declared
by either Federal or New York State authorities or a material disruption in
commercial banking or securities settlement or clearance services in the United
States; (iv) the outbreak or escalation of hostilities involving the United
States or the declaration by the United States of a national emergency or war or
(v) the occurrence of any other calamity or crisis or any change in financial,
political or economic conditions in the United States or elsewhere, if the
effect of any such event specified in clause (iv) or (v) in the judgment of the
Purchasers makes it impracticable or inadvisable to proceed with the public
offering or the delivery of the Securities on the terms and in the manner
contemplated in the Offering Circular;
(g) The Securities have been designated for trading on PORTAL;
(h) The shares of Stock issuable upon conversion of the Securities in
accordance with the Indenture shall have been duly listed, subject to official
notice of issuance, on the New York Stock Exchange; and
(i) The Company shall have furnished or caused to be furnished to you at
the Time of Delivery the certificate of an officer of the Company satisfactory
to you as to the accuracy of the representations and warranties of the Company
herein at and as of such Time of Delivery, as to the performance by the Company
of all of its obligations hereunder to be performed at or prior to such Time of
Delivery, as to the matters set forth in subsections (d) and (e) of this Section
and as to such other matters as you may reasonably request.
8. (a) The Company will indemnify and hold harmless each Purchaser against
any losses, claims, damages or liabilities, joint or several, to which such
Purchaser may become subject, under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon an untrue statement or alleged untrue statement of a
material fact contained in the Preliminary Offering Circular or the Offering
Circular, or any amendment or supplement thereto, or arise out of or are based
upon the omission or alleged omission to state therein a material fact necessary
to make the statements therein not misleading, and will reimburse each Purchaser
for any legal or other expenses reasonably incurred by such Purchaser in
connection with investigating or defending any such action or claim as such
expenses are incurred; provided, however, that the Company shall not be liable
in any such case to the extent that any such loss, claim, damage or liability
arises out of or is based upon an untrue statement or alleged untrue statement
or omission or alleged omission made in any Preliminary Offering Circular or the
Offering Circular or any such amendment or supplement in reliance upon and in
conformity with written information furnished to the Company by any Purchaser
through Goldman, Sachs & Co. expressly for use therein.
(b) Each Purchaser will indemnify and hold harmless the Company against
any losses, claims, damages or liabilities to which the Company may become
subject, under the Act
15
or otherwise, insofar as such losses, claims, damages or liabilities (or actions
in respect thereof) arise out of or are based upon an untrue statement or
alleged untrue statement of a material fact contained in any Preliminary
Offering Circular or the Offering Circular, or any amendment or supplement
thereto, or arise out of or are based upon the omission or alleged omission to
state therein a material fact or necessary to make the statements therein not
misleading, in each case to the extent, but only to the extent, that such untrue
statement or alleged untrue statement or omission or alleged omission was made
in any Preliminary Offering Circular or the Offering Circular or any such
amendment or supplement in reliance upon and in conformity with written
information furnished to the Company by such Purchaser expressly for use
therein; and will reimburse the Company for any legal or other expenses
reasonably incurred by the Company in connection with investigating or defending
any such action or claim as such expenses are incurred.
(c) Promptly after receipt by an indemnified party under subsection (a) or
(b) above of notice of the commencement of any action, such indemnified party
shall, if a claim in respect thereof is to be made against the indemnifying
party under such subsection, notify the indemnifying party in writing of the
commencement thereof; but the omission so to notify the indemnifying party shall
not relieve it from any liability which it may have to any indemnified party
otherwise than under such subsection. In case any such action 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 satisfactory to such indemnified party (who shall not, except with the
consent of the indemnified party, be counsel to the indemnifying party), and,
after notice from the indemnifying party to such indemnified party of its
election so to assume the defense thereof, the indemnifying party shall not be
liable to such indemnified party under such subsection for any legal expenses of
other counsel or any other expenses, in each case subsequently incurred by such
indemnified party, in connection with the defense thereof other than reasonable
costs of investigation. No indemnifying party shall, without the written consent
of the indemnified party, effect the settlement or compromise of, or consent to
the entry of any judgment with respect to, any pending or threatened action or
claim in respect of which indemnification or contribution may be sought
hereunder (whether or not the indemnified party is an actual or potential party
to such action or claim) unless such settlement, compromise or judgment (i)
includes an unconditional release of the indemnified party from all liability
arising out of such action 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) If the indemnification provided for in this Section 8 is unavailable
to or insufficient to hold harmless an indemnified party under subsection (a) or
(b) above in respect of any losses, claims, damages or liabilities (or actions
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 in respect thereof)
in such proportion as is appropriate to reflect the relative benefits received
by the Company on the one hand and the Purchasers on the other from the offering
of the Securities. 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 subsection (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 Company on the one hand and
the Purchasers on the other in connection with the statements or omissions which
resulted in such losses, claims, damages or liabilities (or actions in respect
thereof), as well as any other relevant equitable considerations. The relative
benefits
16
received by the Company on the one hand and the Purchasers on the other from the
offering of the Securities shall be deemed to be in the same proportion as the
total net proceeds from the offering (before deducting expenses) received by the
Company bear to the total underwriting discounts and commissions received by the
Purchasers, in each case as set forth in the Offering Circular. 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 Company
on the one hand or the Purchasers on the other and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The Company and the Purchasers agree that it would not be
just and equitable if contribution pursuant to this subsection (d) were
determined by pro rata allocation (even if the Purchasers 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
subsection (d). The amount paid or payable by an indemnified party as a result
of the losses, claims, damages or liabilities (or actions in respect thereof)
referred to above in this subsection (d) shall be deemed to include, subject to
the limitations set forth above, 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), no
Purchaser shall be required to contribute any amount in excess of the amount by
which the total price at which the Securities underwritten by it and distributed
to investors were offered to investors exceeds the amount of any damages which
such Purchaser has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. The Purchasers'
obligations in this subsection (d) to contribute are several in proportion to
their respective underwriting obligations and not joint. 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
fraudulent misrepresentation.
(e) The obligations of the Company under this Section 8 shall be in
addition to any liability which the Company may otherwise have and shall extend,
upon the same terms and conditions, to each person, if any, who controls any
Purchaser within the meaning of the Act; and the obligations of the Purchasers
under this Section 8 shall be in addition to any liability which the respective
Purchasers may otherwise have and shall extend, upon the same terms and
conditions, to each officer and director of the Company and to each person, if
any, who controls the Company within the meaning of the Act.
9. (a) If any Purchaser shall default in its obligation to purchase the
Securities which it has agreed to purchase hereunder, you may in your discretion
arrange for you or another party or other parties to purchase such Securities on
the terms contained herein. If within thirty-six hours after such default by any
Purchaser you do not arrange for the purchase of such Securities, then the
Company shall be entitled to a further period of thirty-six hours within which
to procure another party or other parties satisfactory to you to purchase such
Securities on such terms. In the event that, within the respective prescribed
periods, you notify the Company that you have so arranged for the purchase of
such Securities, or the Company notifies you that it has so arranged for the
purchase of such Securities, you or the Company shall have the right to postpone
the Time of Delivery for a period of not more than seven days, in order to
effect whatever changes in your opinion may thereby be made necessary in the
Offering Circular, or in any other documents or arrangements, and the Company
agrees to prepare promptly any amendments to the Offering Circular that effects
such changes. The term "Purchaser" as used in this Agreement shall include any
person substituted under this Section with like effect as if such person had
originally been a party to this Agreement with respect to such Securities.
17
(b) If, after giving effect to any arrangements for the purchase of the
Securities of a defaulting Purchaser or Purchasers by you and the Company as
provided in subsection (a) above, the aggregate principal amount of such
Securities which remains unpurchased does not exceed one-eleventh of the
aggregate principal amount of all the Securities, then the Company shall have
the right to require each non-defaulting Purchaser to purchase the principal
amount of Securities which such Purchaser agreed to purchase hereunder and, in
addition, to require each non-defaulting Purchaser to purchase its pro rata
share (based on the principal amount of Securities which such Purchaser agreed
to purchase hereunder) of the Securities of such defaulting Purchaser or
Purchasers for which such arrangements have not been made; but nothing herein
shall relieve a defaulting Purchaser from liability for its default.
(c) If, after giving effect to any arrangements for the purchase of the
Securities of a defaulting Purchaser or Purchasers by you and the Company as
provided in subsection (a) above, the aggregate principal amount of Securities
which remains unpurchased exceeds one-eleventh of the aggregate principal amount
of all the Securities, or if the Company shall not exercise the right described
in subsection (b) above to require non-defaulting Purchasers to purchase
Securities of a defaulting Purchaser or Purchasers, then this Agreement (or,
with respect to the Second Time of Delivery, the obligation of the Purchasers to
purchase and of the Company to sell the Optional Securities) shall thereupon
terminate, without liability on the part of any non-defaulting Purchaser or the
Company, except for the expenses to be borne by the Company and the Purchasers
as provided in Section 6 hereof and the indemnity and contribution agreements in
Section 8 hereof; but nothing herein shall relieve a defaulting Purchaser from
liability for its default.
10. The respective indemnities, agreements, representations and warranties
of and certificates delivered by the Company and the several Purchasers, as set
forth in this Agreement or made by or on behalf of them, respectively, pursuant
to this Agreement, shall remain in full force and effect, regardless of any
investigation (or any statement as to the results thereof) made by or on behalf
of any Purchaser or any controlling person of any Purchaser, or the Company, or
any officer or director or controlling person of the Company, and shall survive
delivery of and payment for the Securities.
11. If this Agreement shall be terminated pursuant to Section 9 hereof,
the Company shall not then be under any liability to any Purchaser except as
provided in Sections 6 and 8 hereof; but, if for any other reason, the
Securities are not delivered by or on behalf of the Company as provided herein,
the Company will reimburse the Purchasers through you for all out-of-pocket
expenses approved in writing by you, including fees and disbursements of
counsel, reasonably incurred by the Purchasers in making preparations for the
purchase, sale and delivery of the Securities, but the Company shall then be
under no further liability to any Purchaser except as provided in Sections 6 and
8 hereof.
12. In all dealings hereunder, you shall act on behalf of each of the
Purchasers, and the parties hereto shall be entitled to act and rely upon any
statement, request, notice or agreement on behalf of any Purchaser made or given
by you jointly as the Purchasers.
All statements, requests, notices and agreements hereunder shall be in
writing, and if to the Purchasers shall be delivered or sent by mail, telex or
facsimile transmission to Goldman, Sachs & Co., 85 Broad Street, New York, New
York 10004, Attention: Registration Department, Deutsche Bank Securities Inc.,
60 Wall Street, New York, NY 10005, Attention: Eric Watson, and J.P. Morgan
Securities Inc., 277 Park Avenue, New York, New York 10172; and if to the
Company shall be delivered or sent by mail, telex or facsimile transmission to
the address of the
18
Company set forth in the Offering Circular, Attention: Secretary; provided,
however, that any notice to a Purchaser pursuant to Section 8(c) hereof shall be
delivered or sent by mail, telex or facsimile transmission to such Purchaser at
its address set forth in its Purchasers' Questionnaire, or telex constituting
such Questionnaire, which address will be supplied to the Company by you upon
request. Any such statements, requests, notices or agreements shall take effect
upon receipt thereof.
13. This Agreement shall be binding upon, and inure solely to the benefit
of, the Purchasers, the Company and, to the extent provided in Sections 8 and 10
hereof, the officers and directors of the Company and each person who controls
the Company or any Purchaser, and their respective heirs, executors,
administrators, successors and assigns, and no other person shall acquire or
have any right under or by virtue of this Agreement. No purchaser of any of the
Securities from any Purchaser shall be deemed a successor or assign by reason
merely of such purchase.
14. Time shall be of the essence of this Agreement.
15. This Agreement shall be governed by and construed in accordance with
the laws of the State of New York.
16. This Agreement may be executed by any one or more of the parties
hereto in any number of counterparts, each of which shall be deemed to be an
original, but all such respective counterparts shall together constitute one and
the same instrument.
17. The Company is authorized, subject to applicable law, to disclose any
and all aspects of this potential transaction that are necessary to support any
U.S. federal income tax benefits expected to be claimed with respect to such
transaction, and all materials of any kind (including tax opinions and other tax
analyses) related to those benefits, without the Purchasers imposing any
limitation of any kind.
If the foregoing is in accordance with your understanding, please sign and
return to us, one for the Company and each of the Purchasers plus one for each
counsel, counterparts hereof, and upon the acceptance hereof by you, on behalf
of each of the Purchasers, this letter and such acceptance hereof shall
constitute a binding agreement between each of the Purchasers and the Company.
It is understood that your acceptance of this letter on behalf of each of the
Purchasers is pursuant to the authority set forth in a form of Agreement among
Purchasers, the form of which shall be submitted to the Company for examination
upon request, but without warranty on your part as to the authority of the
signers thereof.
19
Very truly yours,
The Goodyear Tire & Rubber Company
By: /s/ Darren R. Wells
-------------------
Name: Darren R. Wells
Title: Vice President and Treasurer
20
Accepted as of the date hereof:
Goldman, Sachs & Co.
By: /s/ Goldman, Sachs & Co.
-------------------------
(Goldman, Sachs & Co.)
21
Accepted as of the date hereof:
Deutsche Bank Securities Inc.
By: /s/ Deutsche Bank Securities Inc.
---------------------------------
(Deutsche Bank Securities Inc.)
22
Accepted as of the date hereof:
J.P. Morgan Securities Inc.
By: /s/ Santoon Sreenivasan
-------------------------------
(J.P. Morgan Securities Inc.)
23