<Page>
EXHIBIT 1.1
LKQ CORPORATION
? Shares
Common Stock
($.01 Par Value)
UNDERWRITING AGREEMENT
_________ __, 2003
<Page>
UNDERWRITING AGREEMENT
, 2003
Robert W. Baird & Co. Incorporated
as Managing Underwriter
777 East Wisconsin Avenue
Milwaukee, WI 53202-5391
Ladies and Gentlemen:
LKQ Corporation, a Delaware corporation (the "Company"), proposes to
issue and sell and the persons named in Schedule B annexed hereto (the "Selling
Stockholders") propose to sell to the underwriters named in Schedule A annexed
hereto (the "Underwriters"), for whom you are acting as representative, an
aggregate of ___________ shares (the "Firm Shares") of Common Stock, $.01 par
value (the "Common Stock"), of the Company, of which ___________ shares are to
be issued and sold by the Company and an aggregate of _____________ shares are
to be sold by the Selling Stockholders in the respective amounts set forth under
the caption "Firm Shares" in Schedule B annexed hereto. In addition, solely for
the purpose of covering over-allotments, the Selling Stockholders propose to
grant to the Underwriters the option to purchase from the Selling Stockholders
up to an additional ____________ shares of Common Stock (the "Additional
Shares") in the respective amounts set forth under the caption "Additional
Shares" in Schedule B hereto. The Firm Shares and the Additional Shares are
hereinafter collectively sometimes referred to as the "Shares." The Shares are
described in the Prospectus which is referred to below.
The Company hereby acknowledges that in connection with the proposed
offering of the Shares, it has requested Robert W. Baird & Co. Incorporated
("Robert W. Baird") to administer a directed share program (the "Directed Share
Program") under which up to _______ Firm Shares, or 5% of the Firm Shares to be
purchased by the Underwriters (the "Reserved Shares"), shall be reserved for
sale by Robert W. Baird at the initial public offering price to the Company's
officers, directors, employees and consultants and other persons having a
relationship with the Company, designated by the Company, (the "Directed Share
Participants") as part of the distribution of the Shares by the Underwriters,
subject to the terms of this Agreement, the applicable rules, regulations and
interpretations of the National Association of Securities Dealers, Inc. ("NASD")
and all other applicable laws, rules and regulations. The number of Shares
available for sale to the general public will be reduced to the extent that
Directed Share Participants purchase Reserved Shares. The Underwriters may offer
any Reserved Shares not purchased by Directed Share Participants to the general
public on the same basis as the other Shares being issued and sold hereunder.
The Company has supplied Robert W. Baird with names, addresses and telephone
numbers of the individuals or other entities which the Company has designated to
be participants in the Directed Share Program. It is understood that any number
of those designated to participate in the Directed Share Program may decline to
do so.
2
<Page>
The Company has filed, in accordance with the provisions of the
Securities Act of 1933, as amended, and the rules and regulations thereunder
(collectively, the "Act"), with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-1 (File No. ____) including a
prospectus, relating to the Shares. The Company has furnished to you, for use by
the Underwriters and by dealers, copies of one or more preliminary prospectuses
(each thereof being herein called a "Preliminary Prospectus") relating to the
Shares. Except where the context otherwise requires, the registration statement,
as amended when it becomes effective, including all documents filed as a part
thereof, and including any information contained in a prospectus subsequently
filed with the Commission pursuant to Rule 424(b) under the Act and deemed to be
part of the registration statement at the time of effectiveness pursuant to Rule
430(A) under the Act and also including any registration statement filed
pursuant to Rule 462(b) under the Act, is herein called the "Registration
Statement," and the prospectus, in the form filed by the Company with the
Commission pursuant to Rule 424(b) under the Act on or before the second
business day after the date hereof (or such earlier time as may be required
under the Act) or, if no such filing is required, the form of final prospectus
included in the Registration Statement at the time it became effective, is
herein called the "Prospectus." As used herein, "business day" shall mean a day
on which the New York Stock Exchange is open for trading.
The Company, the Selling Stockholders and the Underwriters agree as
follows:
1. SALE AND PURCHASE. Upon the basis of the representations and
warranties and subject to the terms and conditions herein set forth, the Company
and each of the Selling Stockholders, severally and not jointly, agrees to issue
and sell to the respective Underwriters and each of the Underwriters, severally
and not jointly, agrees to purchase from the Company and each Selling
Stockholder the respective number of Firm Shares (subject to such adjustment as
you may determine to avoid fractional shares) which bears the same proportion to
the number of Firm Shares to be sold by the Company or by such Selling
Stockholders, as the case may be, as the number of Firm Shares set forth
opposite the name of such Underwriter in Schedule A attached hereto bears to the
total number of Firm Shares set forth opposite the names of all Underwriters on
Schedule A, subject to adjustment in accordance with Section 8 hereof, in each
case at a purchase price of $______ per Share. The Company and each Selling
Stockholder is advised by you that the Underwriters intend (i) to make a public
offering of their respective portions of the Firm Shares as soon after the
effective date of the Registration Statement as in your judgment is advisable
and (ii) initially to offer the Firm Shares upon the terms set forth in the
Prospectus. You may from time to time increase or decrease the public offering
price after the initial public offering to such extent as you may determine.
In addition, the Selling Stockholders listed on Schedule B hereto
hereby grant to the several Underwriters the option to purchase, and, upon the
basis of the representations and warranties and subject to the terms and
conditions herein set forth, the Underwriters shall have the right to purchase,
severally and not jointly, from the Selling Stockholders listed on Schedule B
hereto, ratably in accordance with the number of Firm Shares to be purchased by
each of them, all or a portion of the Additional Shares as may be necessary to
cover over-allotments made in connection with the offering of the Firm Shares,
at the same purchase price per share to be paid by the Underwriters to the
Selling Stockholders listed on Schedule B hereto for the Firm Shares. This
option may be exercised by
3
<Page>
Robert W. Baird on behalf of the several Underwriters at any time and from time
to time on or before the thirtieth day following the date hereof, by written
notice to the Company and the Selling Stockholders listed on Schedule B hereto.
Such notice shall set forth the aggregate number of Additional Shares as to
which the option is being exercised, and the date and time when the Additional
Shares are to be delivered (such date and time being herein referred to as the
"additional time of purchase"); PROVIDED, HOWEVER, that the additional time of
purchase shall not be earlier than the time of purchase (as defined below) nor
earlier than the second business day after the date on which the option shall
have been exercised nor later than the tenth business day after the date on
which the option shall have been exercised. The number of Additional Shares to
be sold to each Underwriter shall be the number which bears the same proportion
to the aggregate number of Additional Shares being purchased as the number of
Firm Shares set forth opposite the name of such Underwriter on Schedule A hereto
bears to the total number of Firm Shares (subject, in each case, to such
adjustment as you may determine to eliminate fractional shares), subject to
adjustment in accordance with Section 10 hereof.
Pursuant to powers of attorney (the "Power of Attorney"), which shall
be satisfactory to counsel for the Underwriters, granted by each Selling
Stockholder,___________________ and _____________ will act as representatives of
the Selling Stockholders. The foregoing representatives (the "Representatives of
the Selling Stockholders") are authorized, on behalf of each Selling
Stockholder, to execute any documents necessary or desirable in connection with
the sale of the Shares to be sold hereunder by each Selling Stockholder, to make
delivery of the certificates of such Shares, to receive the proceeds of the sale
of such Shares, to give receipts for such proceeds, to pay therefrom the
expenses to be borne by each Selling Stockholder in connection with the sale and
public offering of the Shares, to distribute the balance of such proceeds to
each Selling Stockholder in proportion to the number of Shares sold by each
Selling Stockholder, to receive notices on behalf of each Selling Stockholder
and to take such other action as may be necessary or desirable in connection
with the transactions contemplated by this Agreement.
2. PAYMENT AND DELIVERY. Payment of the purchase price for the Firm
Shares shall be made to the Company and each of the Selling Stockholders by
Federal Funds wire transfer, against delivery of the certificates for the Firm
Shares to you through the facilities of The Depository Trust Company (DTC) for
the respective accounts of the Underwriters. Such payment and delivery shall be
made at 10:00 A.M., New York City time, on _______________, 2003 (unless another
time shall be agreed to by you and the Company and the Representatives of the
Selling Stockholders or unless postponed in accordance with the provisions of
Section 10 hereof). The time at which such payment and delivery are to be made
is hereinafter sometimes called "the time of purchase." Electronic transfer of
the Firm Shares shall be made to you at the time of purchase in such names and
in such denominations as you shall specify.
Payment of the purchase price for the Additional Shares shall be made
at the additional time of purchase in the same manner and at the same office as
the payment for the Firm Shares. Electronic transfer of the Additional Shares
shall be made to you at the additional time of purchase in such names and in
such denominations as you shall specify.
4
<Page>
Deliveries of the documents described in Section 8 hereof with respect
to the purchase of the Shares shall be made at the offices of Bell, Boyd & Lloyd
LLC, 70 West Madison Street, Chicago, Illinois 60602 at 9:00 A.M. New York City
time, on the date of the closing of the purchase of the Firm Shares or the
Additional Shares, as the case may be.
3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company represents
and warrants to and agrees with each of the Underwriters that:
(a) The Registration Statement has been declared effective under the
Act; no stop order of the Commission preventing or suspending the use of any
Preliminary Prospectus or the effectiveness of the Registration Statement
has been issued and no proceedings for such purpose have been instituted or,
to the Company's knowledge after due inquiry, are contemplated by the
Commission; each Preliminary Prospectus, at the time of filing thereof,
complied in all material respects with the requirements of the Act and the
last Preliminary Prospectus distributed in connection with the offering of
the Shares did not, as of its date, and does not contain an untrue statement
of a material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading; the Registration
Statement complied when it became effective, complies and will comply, at
the time of purchase and any additional time of purchase, in all material
respects with the requirements of the Act and the Prospectus will comply, as
of its date and at the time of purchase and any additional times of
purchase, in all material respects with the requirements of the Act and any
statutes, regulations, contracts or other documents that are required to be
described in the Registration Statement or the Prospectus or to be filed as
exhibits to the Registration Statement have been and will be so described or
filed; the Registration Statement did not when it became effective, does not
and will not, at the time of purchase and any additional time of purchase,
contain an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements
therein not misleading and the Prospectus will not, as of its date and at
the time of purchase and any additional time of purchase, contain an untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading; PROVIDED, HOWEVER,
that the Company makes no representation or warranty with respect to any
statement contained in the Preliminary Prospectus, the Registration
Statement or the Prospectus in reliance upon and in conformity with
information concerning an Underwriter and furnished in writing by or on
behalf of such Underwriter through you to the Company expressly for use in
the Preliminary Prospectus, the Registration Statement or the Prospectus;
and the Company has not distributed and will not distribute any offering
material in connection with the offering or sale of the Shares other than
the Registration Statement, the Preliminary Prospectus and the Prospectus;
(b) as of the date of this Agreement, the Company has an authorized
and outstanding capitalization as set forth under the heading "Actual" in
the section of the Registration Statement and the Prospectus entitled
"Capitalization" and, as of the time of purchase and the additional time of
purchase, as the case may be, the Company shall have an
5
<Page>
authorized and outstanding capitalization as set forth under the heading "As
Adjusted" in the section of the Registration Statement and the Prospectus
entitled "Capitalization"; all of the issued and outstanding shares of
capital stock, including the Common Stock, of the Company have been duly
authorized and validly issued and are fully paid and non-assessable, have
been issued in compliance with all federal and state securities laws and
were not issued in violation of any preemptive right, resale right, right of
first refusal or similar right;
(c) the Company has been duly incorporated and is validly existing as
a corporation in good standing under the laws of the State of Delaware, with
full corporate power and authority to own, lease and operate its properties
and conduct its business as described in the Registration Statement and the
Prospectus, to execute and deliver this Agreement and to issue, sell and
deliver the Shares to be sold by it as contemplated herein;
(d) the Company is duly qualified to do business as a foreign
corporation and is in good standing in each jurisdiction where the ownership
or leasing of its properties or the conduct of its business requires such
qualification, except where the failure to be so qualified and in good
standing would not, individually or in the aggregate, have a material
adverse effect on the business, properties, financial condition, results of
operation or prospects of the Company and the Subsidiaries (as hereinafter
defined) taken as a whole (a "Material Adverse Effect");
(e) the Company has no subsidiaries (as defined in the Securities
Exchange Act of 1934, as amended (the "Exchange Act")) other than the
subsidiaries listed on Schedule C hereto (collectively, the "Subsidiaries");
the Company owns, directly or indirectly, 100% of the outstanding common
stock of all of the Subsidiaries; other than the capital stock of the
Subsidiaries, the Company does not own, directly or indirectly, any shares
of stock or any other equity or long-term debt securities of any corporation
or have any equity interest in any firm, partnership, joint venture,
association or other entity; complete and correct copies of the certificates
of incorporation and the by-laws of the Company and the Subsidiaries and all
amendments thereto have been delivered to you, and except as set forth in
the exhibits to the Registration Statement no changes therein will be made
subsequent to the date hereof and prior to the time of purchase or, if
later, the additional time of purchase; each Subsidiary has been duly
incorporated and is validly existing as a corporation in good standing under
the laws of the jurisdiction of its incorporation, with full corporate power
and authority to own, lease and operate its properties and to conduct its
business as described in the Registration Statement and the Prospectus; each
Subsidiary is duly qualified to do business as a foreign corporation and is
in good standing in each jurisdiction where the ownership or leasing of its
properties or the conduct of its business requires such qualification,
except where the failure to be so qualified and in good standing would not,
individually or in the aggregate, have a Material Adverse Effect; all of the
outstanding shares of capital stock of each of the Subsidiaries have been
duly authorized and validly issued, are fully paid and non-assessable and
(except as otherwise described in this Section 3(e)) are owned by the
Company subject to no security interest, other encumbrance or adverse claims
other than those arising under the Company's credit facility; and no
options, warrants or other rights to purchase, agreements or
6
<Page>
other obligations to issue or other rights to convert any obligation into
shares of capital stock or ownership interests in the Subsidiaries are
outstanding;
(f) the Shares have been duly and validly authorized and, when issued
and delivered against payment therefor as provided herein, will be duly and
validly issued, fully paid and non-assessable and free of statutory and
contractual preemptive rights, resale rights, rights of first refusal and
similar rights;
(g) the capital stock of the Company, including the Shares, conforms
in all material respects to the description thereof contained in the
Registration Statement and the Prospectus and the certificates for the
Shares are in due and proper form and the holders of the Shares will not be
subject to personal liability by reason of being such holders;
(h) this Agreement has been duly authorized, executed and delivered
by the Company;
(i) neither the Company nor any of the Subsidiaries is in breach or
violation of or in default under (nor has any event occurred which with
notice, lapse of time or both would result in any breach of, constitute a
default under or give the holder of any indebtedness (or a person acting on
such holder's behalf) the right to require the repurchase, redemption or
repayment of all or a part of such indebtedness under) its respective
charter or by-laws, or, except for such breaches, violations or defaults
which could not reasonably be expected, individually or in the aggregate, to
have a Material Adverse Effect, any indenture, mortgage, deed of trust, bank
loan or credit agreement or other evidence of indebtedness, or any license,
lease, contract or other agreement or instrument to which the Company or any
of the Subsidiaries is a party or by which any of them or any of their
properties may be bound or affected; and the execution, delivery and
performance of this Agreement, the issuance and sale of the Shares and the
consummation of the transactions contemplated hereby will not conflict with,
result in any breach or violation of or constitute a default under (nor
constitute any event which with notice, lapse of time or both would result
in any breach of or constitute a default under) the charter or by-laws of
the Company or any of the Subsidiaries, or any indenture, mortgage, deed of
trust, bank loan or credit agreement or other evidence of indebtedness, or
any license, lease, contract or other agreement or instrument to which the
Company or any of the Subsidiaries is a party or by which any of them or any
of their respective properties may be bound or affected, or any federal,
state, local or foreign law, regulation or rule or any decree, judgment or
order applicable to the Company or any of the Subsidiaries;
(j) no approval, authorization, consent or order of or filing with
any federal, state, local or foreign governmental or regulatory commission,
board, body, authority or agency is required in connection with the issuance
and sale of the Shares or the consummation by the Company of the
transactions contemplated hereby other than registration of the Shares under
the Act, which has been or will be effected, and any necessary
7
<Page>
qualification under the securities or blue sky laws of the various
jurisdictions in which the Shares are being offered by the Underwriters or
under the rules and regulations of the NASD;
(k) except as set forth in the Registration Statement and the
Prospectus, (i) no person has the right, contractual or otherwise, to cause
the Company to issue or sell to it any shares of Common Stock or shares of
any other capital stock or other equity interests of the Company, (ii) no
person has any preemptive rights, resale rights, rights of first refusal or
other rights to purchase any shares of Common Stock or shares of any other
capital stock or other equity interests of the Company, and (iii) no person
has the right to act as an underwriter or as a financial advisor to the
Company in connection with the offer and sale of the Shares, in the case of
each of the foregoing clauses (i), (ii) and (iii), whether as a result of
the filing or effectiveness of the Registration Statement or the sale of the
Shares as contemplated thereby or otherwise; except as set forth in the
Registration Statement and the Prospectus, no person has the right,
contractual or otherwise, to cause the Company to register under the Act any
shares of Common Stock or shares of any other capital stock or other equity
interests of the Company, or to include any such shares or interests in the
Registration Statement or the offering contemplated thereby, whether as a
result of the filing or effectiveness of the Registration Statement or the
sale of the Shares as contemplated thereby or otherwise;
(l) each of the Company and the Subsidiaries has all necessary
licenses, authorizations, consents and approvals and has made all necessary
filings required under any federal, state, local or foreign law, regulation
or rule, and has obtained all necessary authorizations, consents and
approvals from other persons, in order to conduct its respective business,
except where the absence of such license, authorization, consent, approval
or filing could not reasonably be expected, individually or in the
aggregate, to have a Material Adverse Effect; neither the Company nor any of
the Subsidiaries is in violation of, or in default under, or has received
notice of any proceedings relating to revocation or modification of, any
such license, authorization, consent or approval or any federal, state,
local or foreign law, regulation or rule or any decree, order or judgment
applicable to the Company or any of the Subsidiaries, except where such
violation, default, revocation or modification would not, individually or in
the aggregate, have a Material Adverse Effect;
(m) all legal or governmental proceedings, affiliate transactions,
off-balance sheet transactions, contracts, licenses, agreements, leases or
documents 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 have been so described or filed as required;
(n) except as described in the Registration Statement and the
Prospectus, there are no actions, suits, claims, investigations or
proceedings pending or threatened or, to the Company's knowledge,
contemplated to which the Company or any of the Subsidiaries or any of their
respective directors or officers is a party or of which any of the
respective properties of the Company or its Subsidiaries is subject at law
or in equity, before or by any federal, state, local or foreign governmental
or regulatory commission, board, body, authority or
8
<Page>
agency, except any such action, suit, claim, investigation or proceeding
which would not result in a judgment, decree or order having, individually
or in the aggregate, a Material Adverse Effect or preventing consummation of
the transactions contemplated hereby;
(o) Deloitte & Touche LLP, whose report on the consolidated financial
statements of the Company and the Subsidiaries is filed with the Commission
as part of the Registration Statement and the Prospectus, are independent
public accountants as required by the Act;
(p) the audited financial statements included in the Registration
Statement and the Prospectus, together with the related notes and schedules,
present fairly the consolidated financial position of the Company and the
Subsidiaries as of the dates indicated and the consolidated results of
operations and cash flows of the Company and the Subsidiaries for the
periods specified and have been prepared in compliance with the requirements
of the Act and in conformity with generally accepted accounting principles
applied on a consistent basis during the periods involved; any pro forma
financial statements or data included in the Registration Statement and the
Prospectus comply with the requirements of Regulation S-X of the Act and the
assumptions used in the preparation of such pro forma financial statements
and data are reasonable, the pro forma adjustments used therein are
appropriate to give effect to the transactions or circumstances described
therein and the pro forma adjustments have been properly applied to the
historical amounts in the compilation of those statements and data; the
other financial and statistical data set forth in the Registration Statement
and the Prospectus are accurately presented and prepared on a basis
consistent with the financial statements and books and records of the
Company; there are no financial statements (historical or pro forma) that
are required to be included in the Registration Statement and the Prospectus
that are not included as required; and the Company and the Subsidiaries do
not have any material liabilities or obligations, direct or contingent
(including any off-balance sheet obligations), not disclosed in the
Registration Statement and the Prospectus.
(q) subsequent to the respective dates as of which information is
given in the Registration Statement and the Prospectus, except as described
in the Registration Statement and Prospectus, there has not been (i) any
material adverse change, or any development involving a prospective material
adverse change, in the business, properties, management, financial condition
or results of operations of the Company and the Subsidiaries taken as a
whole, (ii) any transaction which is material to the Company and the
Subsidiaries taken as a whole, (iii) any obligation, direct or contingent
(including any off-balance sheet obligations), incurred by the Company or
the Subsidiaries, which is material to the Company and the Subsidiaries
taken as a whole, (iv) any change in the capital stock or outstanding
indebtedness of the Company or the Subsidiaries except pursuant to Company
employee plans described in the Registration Statement, or (v) any dividend
or distribution of any kind declared, paid or made on the capital stock of
the Company;
9
<Page>
(r) the Company has obtained for the benefit of the Underwriters the
agreement (a "Lock-Up Agreement"), in the form set forth as EXHIBIT A
hereto, of each of its directors and officers and each holder of the
Company's securities identified on Schedule D hereto;
(s) the Company is not and, after giving effect to the offering and
sale of the Shares, will not be an "investment company" or an entity
"controlled" by an "investment company," as such terms are defined in the
Investment Company Act of 1940, as amended (the "Investment Company Act");
(t) the Company and each of the Subsidiaries has good and marketable
title to all property (real and personal) described the Registration
Statement and in the Prospectus as being owned by each of them, free and
clear of all liens, claims, security interests or other encumbrances except
as described in the Registration Statement and except as could not
reasonably be expected, individually or in the aggregate, to have a Material
Adverse Effect; all the property described in the Registration Statement and
the Prospectus as being held under lease by the Company or a Subsidiary is,
assuming due and valid execution by the lessor, held thereby under valid,
subsisting and enforceable leases;
(u) the Company and the Subsidiaries own, or have obtained valid and
enforceable licenses for, or other rights to use, the inventions, patent
applications, patents, trademarks (both registered and unregistered),
tradenames, copyrights, trade secrets and other proprietary information
described in the Registration Statement and the Prospectus as being owned or
licensed by them or which are necessary for the conduct of their respective
businesses, except where the failure to own, license or have such rights
would not, individually or in the aggregate, have a Material Adverse Effect
(collectively, "Intellectual Property"); (i) there are no third parties who
have or, to the Company's knowledge, will be able to establish rights to any
Intellectual Property, except for the ownership rights of the owners of the
Intellectual Property which is licensed to the Company and the rights of
third parties that could not reasonably be expected to have a Material
Adverse Effect; (ii) to the Company's knowledge, there is no infringement by
third parties of any Intellectual Property; (iii) there is no pending or to
the Company's knowledge, threatened action, suit, proceeding or claim by
others challenging the Company's rights in or to any Intellectual Property,
and the Company is unaware of any facts which could form a reasonable basis
for any such claim; (iv) there is no pending or to the Company's knowledge,
threatened action, suit, proceeding or claim by others challenging the
validity or scope of any Intellectual Property, and the Company is unaware
of any facts which could form a reasonable basis for any such claim; (v)
there is no pending or to the Company's knowledge, threatened action, suit,
proceeding or claim by others that the Company infringes or otherwise
violates any patent, trademark, copyright, trade secret or other proprietary
rights of others, and the Company is unaware of any facts which could form a
reasonable basis for any such claim; (vi) to the Company's knowledge, there
is no patent or patent application that contains claims that interfere with
the issued or pending claims of any of the Intellectual Property; and (vii)
to the Company's knowledge, there is no prior art that may render any patent
application owned by the
10
<Page>
Company of the Intellectual Property unpatentable that has not been
disclosed to the U.S. Patent and Trademark Office;
(v) neither the Company nor any of the Subsidiaries is engaged in any
unfair labor practice; except for matters which would not, individually or
in the aggregate, have a Material Adverse Effect, (i) there is (A) no unfair
labor practice complaint pending or, to the Company's knowledge after due
inquiry, threatened against the Company or any of the Subsidiaries before
the National Labor Relations Board, and no grievance or arbitration
proceeding arising out of or under collective bargaining agreements is
pending or threatened, (B) no strike, labor dispute, slowdown or stoppage
pending or, to the Company's knowledge after due inquiry, threatened against
the Company or any of the Subsidiaries and (C) no union representation
dispute currently existing concerning the employees of the Company or any of
the Subsidiaries, and (ii) to the Company's knowledge after due inquiry, (A)
no union organizing activities are currently taking place concerning the
employees of the Company or any of the Subsidiaries and (B) there has been
no violation of any federal, state, local or foreign law relating to
discrimination in the hiring, promotion or pay of employees, any applicable
wage or hour laws or any provision of the Employee Retirement Income
Security Act of 1974 ("ERISA") or the rules and regulations promulgated
thereunder concerning the employees of the Company or any of the
Subsidiaries;
(w) the Company and the Subsidiaries and their properties, assets and
operations are in compliance with, and hold all permits, authorizations and
approvals required under, Environmental Laws (as defined below), except to
the extent that failure to so comply or to hold such permits, authorizations
or approvals would not, individually or in the aggregate, have a Material
Adverse Effect; there are no past, present or, to the Company's knowledge,
reasonably anticipated future events, conditions, circumstances, activities,
practices, actions, omissions or plans that could reasonably be expected to
give rise to any material costs or liabilities to the Company or the
Subsidiaries under, or to interfere with or prevent compliance by the
Company or the Subsidiaries with, Environmental Laws; except as would not,
individually or in the aggregate, have a Material Adverse Effect, neither
the Company nor any of the Subsidiaries (i) is the subject of any
investigation, (ii) has received any notice or claim, (iii) is a party to or
affected by any pending or threatened action, suit or proceeding, (iv) is
bound by any judgment, decree or order or (v) has entered into any
agreement, in each case relating to any alleged violation of any
Environmental Law or any actual or alleged release or threatened release or
cleanup at any location of any Hazardous Materials (as defined below) (as
used herein, "Environmental Law" means any federal, state, local or foreign
law, statute, ordinance, rule, regulation, order, decree, judgment,
injunction, permit, license, authorization or other binding requirement, or
common law, relating to health, safety or the protection, cleanup or
restoration of the environment or natural resources, including those
relating to the distribution, processing, generation, treatment, storage,
disposal, transportation, other handling or release or threatened release of
Hazardous Materials, and "Hazardous Materials" means any material
(including, without limitation, pollutants, contaminants, hazardous or toxic
substances or wastes) that is regulated by or may give rise to liability
under any Environmental Law);
11
<Page>
(x) in the ordinary course of its business, the Company and each of
the Subsidiaries conducts a periodic review of the effect of the
Environmental Laws on its business, operations and properties, in the course
of which it identifies and evaluates associated costs and liabilities
(including, without limitation, any capital or operating expenditures
required for cleanup, closure of properties or compliance with the
Environmental Laws or any permit, license or approval, any related
constraints on operating activities and any potential liabilities to third
parties);
(y) all tax returns required to be filed by the Company and each of
the Subsidiaries have been filed, and all taxes and other assessments of a
similar nature (whether imposed directly or through withholding) including
any interest, additions to tax or penalties applicable thereto due or
claimed to be due from such entities have been paid, other than those being
contested in good faith and for which adequate reserves have been provided;
(z) the Company and each of the Subsidiaries maintains insurance
covering its properties, operations, personnel and businesses as the Company
deems adequate and as previously disclosed to the Underwriters; such
insurance insures against such losses and risks to an extent which is
adequate in accordance with customary industry practice to protect the
Company and the Subsidiaries and their businesses; all such insurance is
fully in force on the date hereof and will be fully in force at the time of
purchase and any additional time of purchase;
(aa) neither the Company nor any of the Subsidiaries has sustained
since the date of the last audited financial statements included in the
Registration Statement and the Prospectus any loss or interference with its
respective business from fire, explosion, flood or other calamity, whether
or not covered by insurance, or from any labor dispute or court or
governmental action, order or decree;
(bb) the Company has not sent or received any communication regarding
termination of, or intent not to renew, any of the contracts or agreements
referred to or described in, or filed as an exhibit to, the Registration
Statement, and no such termination or non-renewal has been threatened by the
Company or, to the Company's knowledge, any other party to any such contract
or agreement;
(cc) the Company and each of the Subsidiaries maintains a system of
internal accounting controls sufficient to provide reasonable assurance 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 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 existing assets at reasonable intervals and
appropriate action is taken with respect to any differences;
12
<Page>
(dd) the Company has established and maintains disclosure controls and
procedures (as such term is defined in Rule 13a-14 and 15d-14 under the
Exchange Act); such disclosure controls and procedures are designed to
ensure that material information relating to the Company, including its
consolidated subsidiaries, is made known to the Company's Chief Executive
Officer and its Chief Financial Officer by others within those entities, and
such disclosure controls and procedures are effective to perform the
functions for which they were established; the Company's auditors and the
Audit Committee of the Board of Directors have been advised of: (i) any
significant deficiencies in the design or operation of internal controls
which could adversely affect the Company's ability to record, process,
summarize, and report financial data; and (ii) any fraud, whether or not
material, that involves management or other employees who have a role in the
Company's internal controls; any material weaknesses in internal controls
have been identified for the Company's auditors; and since the date of the
most recent evaluation of such disclosure controls and procedures, there
have been no significant changes in internal controls or in other factors
that could significantly affect internal controls, including any corrective
actions with regard to significant deficiencies and material weaknesses.
(ee) the Company has provided you true, correct, and complete copies
of all documentation pertaining to any extension of credit in the form of a
personal loan made, directly or indirectly, by the Company to any director
or executive officer of the Company, or to any family member or affiliate of
any director or executive officer of the Company; and since June 30, 2002,
the Company has not, directly or indirectly, including through any
subsidiary: (i) extended credit, arranged to extend credit, or renewed any
extension of credit, in the form of a personal loan, to or for any director
or executive officer of the Company, or to or for any family member or
affiliate of any director or executive officer of the Company; or (ii) made
any material modification, including any renewal thereof, to any term of any
personal loan to any director or executive officer of the Company, or any
family member or affiliate of any director or executive officer, which loan
was outstanding on June 30, 2002.
(ff) any statistical and market-related data included in the
Registration Statement and the Prospectus are based on or derived from
sources that the Company believes to be reliable and accurate, and the
Company has obtained the written consent to the use of such data from such
sources to the extent required;
(gg) neither the Company nor any of the Subsidiaries nor, to the
Company's knowledge, any employee or agent of the Company or the
Subsidiaries has made any payment of funds of the Company or the
Subsidiaries or received or retained any funds in violation of any law, rule
or regulation, which payment, receipt or retention of funds is of a
character required to be disclosed in the Registration Statement or the
Prospectus;
(hh) neither the Company nor any of the Subsidiaries nor any of their
respective directors, officers, affiliates or controlling persons has taken,
directly or indirectly, any action designed, or which has constituted or
might reasonably be expected to cause or result in, under the Exchange Act
or otherwise, the stabilization or manipulation of the price of any
13
<Page>
security of the Company to facilitate the sale or resale of the Shares
except for the Lockup Agreements;
(ii) to the Company's knowledge after due inquiry, there are no
affiliations or associations between any member of the NASD and any of the
Company's officers, directors or securityholders, except as set forth in the
Registration Statement and the Prospectus;
(jj) the Registration Statement, the Prospectus and any preliminary
prospectus comply, and any further amendments or supplements thereto will
comply, with any applicable laws or regulations of any foreign jurisdiction
in which the Prospectus or any preliminary prospectus is distributed in
connection with the Directed Share Program; and no approval, authorization,
consent or order of or filing with any governmental or regulatory
commission, board, body, authority or agency, other than those obtained, is
required in connection with the offering of the Reserved Shares in any
jurisdiction where the Reserved Shares are being offered; and
(kk) the Company has not offered, or caused the Underwriters to offer,
Shares to any person pursuant to the Directed Share Program with the intent
to influence unlawfully (i) a customer or supplier of the Company or any of
the Subsidiaries to alter the customer's or supplier's level or type of
business with the Company or any of the Subsidiaries, or (ii) a trade
journalist or publication to write or publish favorable information about
the Company or any of the Subsidiaries or any of their respective products
or services.
In addition, any certificate signed by any officer of the Company or
any of the Subsidiaries and delivered to the Underwriters or counsel for the
Underwriters in connection with the offering of the Shares shall be deemed to be
a representation and warranty by the Company or Subsidiary, as the case may be,
as to matters covered thereby, to each Underwriter.
4. REPRESENTATIONS AND WARRANTIES OF THE SELLING STOCKHOLDERS. Each
Selling Stockholder, severally and not jointly, represents and warrants to each
Underwriter that:
(a) such Selling Stockholder now is and at the time of delivery of
such Shares (whether the time of purchase or additional time of purchase, as
the case may be) will be, the lawful owner of the number of Shares to be
sold by such Selling Stockholder pursuant to this Agreement and has and, at
the time of delivery thereof, will have valid and marketable title to such
Shares, and upon delivery of and payment for such Shares (whether at the
time of purchase or the additional time of purchase, as the case may be),
the Underwriters will acquire valid and marketable title to such Shares free
and clear of any claim, lien, encumbrance, security interest, community
property right, restriction on transfer or other defect in title;
(b) such Selling Stockholder has and at the time of delivery of such
Shares (whether the time of purchase or additional time of purchase, as the
case may be) will have, full legal right, power and capacity, and any
approval required by law (other than those im-
14
<Page>
posed by the Act and the securities or blue sky laws of certain
jurisdictions), to sell, assign, transfer and deliver such Shares in the
manner provided in this Agreement;
(c) this Agreement, the Custody Agreement among , as custodian,
and the Selling Stockholders (the "Custody Agreement") and the Power of
Attorney have been duly executed and delivered by such Selling Stockholder
and, with respect solely to the Custody Agreement assuming due
authorization, execution and delivery by the custodian, each is a legal,
valid and binding agreement of such Selling Stockholder enforceable in
accordance with its terms;
(d) when the Registration Statement becomes effective and at all
times subsequent thereto through the latest of the time of purchase,
additional time of purchase or the termination of the offering of the
Shares, the Registration Statement and Prospectus, and any supplements or
amendments thereto, as they relate to such Selling Stockholder, will not
contain an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements
therein not misleading;
(e) such Selling Stockholder has duly and irrevocably authorized the
Representatives of the Selling Stockholders, on behalf of such Selling
Stockholder, to execute and deliver this Agreement and any other document
necessary or desirable in connection with the transactions contemplated
thereby and to deliver the Shares to be sold by such Selling Stockholder and
receive payment therefor pursuant hereto; and
(f) the sale of such Selling Stockholder's Shares pursuant to this
Agreement is not prompted by any information concerning the Company which is
not set forth in the Prospectus.
5. CERTAIN COVENANTS OF THE COMPANY. The Company hereby agrees:
(a) to furnish such information as may be required and otherwise to
cooperate in qualifying the Shares for offering and sale under the
securities or blue sky laws of such states or other jurisdictions as you may
designate and to maintain such qualifications in effect so long as you may
request for the distribution of the Shares; PROVIDED that the Company shall
not be required to qualify as a foreign corporation or to consent to the
service of process under the laws of any such jurisdiction (except service
of process with respect to the offering and sale of the Shares); and to
promptly advise you of the receipt by the Company of any notification with
respect to the suspension of the qualification of the Shares for sale in any
jurisdiction or the initiation or threatening of any proceeding for such
purpose;
(b) to make available to the Underwriters in New York City, as soon
as practicable after the Registration Statement becomes effective, and
thereafter from time to time to furnish to the Underwriters, as many copies
of the Prospectus (or of the Prospectus as amended or supplemented if the
Company shall have made any amendments or supplements thereto after the
effective date of the Registration Statement) as the Underwriters may
request
15
<Page>
for the purposes contemplated by the Act; in case any Underwriter is
required to deliver a prospectus after the nine-month period referred to in
Section 10(a)(3) of the Act in connection with the sale of the Shares, the
Company will prepare, at its expense, promptly upon request such amendment
or amendments to the Registration Statement and the Prospectus as may be
necessary to permit compliance with the requirements of Section 10(a)(3) of
the Act;
(c) if, at the time this Agreement is executed and delivered, it is
necessary for the Registration Statement or any post-effective amendment
thereto to be declared effective before the offering of the Shares may
commence, the Company will endeavor to cause the Registration Statement or
such post-effective amendment to become effective as soon as possible and
the Company will advise you promptly and, if requested by you, will confirm
such advice in writing, (i) when the Registration Statement and any such
post-effective amendment thereto has become effective, and (ii) if Rule 430A
under the Act is used, when the Prospectus is filed with the Commission
pursuant to Rule 424(b) under the Act (which the Company agrees to file in a
timely manner under such Rule);
(d) to advise you promptly, confirming such advice in writing, of any
request by the Commission for amendments or supplements to the Registration
Statement or the Prospectus or for additional information with respect
thereto, or of notice of institution of proceedings for, or the entry of a
stop order, suspending the effectiveness of the Registration Statement and,
if the Commission should enter a stop order suspending the effectiveness of
the Registration Statement, to use its best efforts to obtain the lifting or
removal of such order as soon as possible; to advise you promptly of any
proposal to amend or supplement the Registration Statement or the Prospectus
and to provide you and Underwriters' counsel copies of any such documents
for review and comment a reasonable amount of time prior to any proposed
filing and to file no such amendment or supplement to which you shall object
in writing;
(e) subject to Section 5(d) hereof, to file promptly all reports and
any definitive proxy or information statement required to be filed by the
Company with the Commission in order to comply with the Exchange Act
subsequent to the date of the Prospectus and for so long as the delivery of
a prospectus is required in connection with the offering or sale of the
Shares; to provide you with a copy of such reports and statements and other
documents to be filed by the Company pursuant to Section 13, 14 or 15(d) of
the Exchange Act during such period a reasonable amount of time prior to any
proposed filing, and to promptly notify you of such filing;
(f) if necessary or appropriate, to file a registration statement
pursuant to Rule 462(b) under the Act;
(g) to advise the Underwriters promptly of the happening of any event
within the time during which a prospectus relating to the Shares is required
to be delivered under the Act which could require the making of any change
in the Prospectus then being used so that the Prospectus would not include
an untrue statement of material fact or omit to state a material
16
<Page>
fact necessary to make the statements therein, in the light of the
circumstances under which they are made, not misleading, and, during such
time, subject to Section 5(d) hereof, to prepare and furnish, at the
Company's expense, to the Underwriters promptly such amendments or
supplements to such Prospectus as may be necessary to reflect any such
change;
(h) to make generally available to its stockholders, and to deliver
to you, an earnings statement of the Company (which will satisfy the
provisions of Section 11(a) of the Act) covering a period of twelve months
beginning after the effective date of the Registration Statement (as defined
in Rule 158(c) of the Act) as soon as is reasonably practicable after the
termination of such twelve-month period but not later than ________, 2004;
(i) to furnish to its stockholders as soon as practicable after the
end of each fiscal year an annual report (including a consolidated balance
sheet and statements of income, stockholders' equity and cash flow of the
Company and the Subsidiaries for such fiscal year, accompanied by a copy of
the certificate or report thereon of nationally recognized independent
certified public accountants);
(j) to furnish to you five copies of the Registration Statement, as
initially filed with the Commission, and of all amendments thereto
(including all exhibits thereto) and sufficient copies of the foregoing
(other than exhibits) for distribution of a copy to each of the other
Underwriters;
(k) upon request, to furnish promptly to you and to each of the other
Underwriters for a period of three years from the date of this Agreement (i)
copies of any reports or other communications which the Company shall send
to its stockholders or shall from time to time publish or publicly
disseminate, (ii) copies of all annual, quarterly and current reports filed
with the Commission on Forms 10-K, 10-Q and 8-K, or such other similar forms
as may be designated by the Commission, (iii) copies of documents or reports
filed with any national securities exchange on which any class of securities
of the Company is listed, and (iv) such other information as you may
reasonably request regarding the Company or the Subsidiaries;
(l) to furnish to you as early as practicable prior to the time of
purchase and any additional time of purchase, as the case may be, but not
later than two business days prior thereto, a copy of the latest available
unaudited interim and monthly consolidated financial statements, if any, of
the Company and the Subsidiaries which have been read by the Company's
independent certified public accountants, as stated in their letter to be
furnished pursuant to Section 8(b) hereof;
(m) to apply the net proceeds from the sale of the Shares in the
manner set forth under the caption "Use of Proceeds" in the Prospectus;
(n) to pay all costs, expenses, fees and taxes (other than any
transfer taxes and fees and disbursements of counsel for the Underwriters
except as set forth under Section 7 hereof or (iii), (iv) or (ix) below) in
connection with (i) the preparation and filing of the Registration
Statement, each Preliminary Prospectus, the Prospectus, and any amendments
or supple-
17
<Page>
ments thereto, and the printing and furnishing of copies of each thereof to
the Underwriters and to dealers (including costs of mailing and shipment),
(ii) the registration, issue, sale and delivery of the Shares including any
stock or transfer taxes and stamp or similar duties payable upon the sale,
issuance or delivery of the Shares to the Underwriters, (iii) the producing,
word processing and/or printing of this Agreement, any Agreement Among
Underwriters, any dealer agreements, the Custody Agreement and Power of
Attorney and any closing documents (including compilations thereof) and the
reproduction and/or printing and furnishing of copies of each thereof to the
Underwriters and (except closing documents) to dealers (including costs of
mailing and shipment), (iv) the qualification of the Shares for offering and
sale under state or foreign laws and the determination of their eligibility
for investment under state or foreign law as aforesaid (including the legal
fees and filing fees and other disbursements of counsel for the
Underwriters) and the printing and furnishing of copies of any blue sky
surveys or legal investment surveys to the Underwriters and to dealers, (v)
any listing of the Shares on any securities exchange or qualification of the
Shares for quotation on NASDAQ and any registration thereof under the
Exchange Act, (vi) any filing for review of the public offering of the
Shares by the NASD, including the legal fees and filing fees and other
disbursements of counsel to the Underwriters, (vii) the fees and
disbursements of any transfer agent or registrar for the Shares, (viii) the
costs and expenses of the Company relating to presentations or meetings
undertaken in connection with the marketing of the offering and sale of the
Shares to prospective investors and the Underwriters' sales forces,
including, without limitation, expenses associated with the production of
road show slides and graphics, fees and expenses of any consultants engaged
in connection with the road show presentations, travel, lodging and other
expenses incurred by the officers of the Company and any such consultants,
and the cost of any aircraft chartered in connection with the road show,
(ix) the offer and sale of the Reserved Shares, including all costs and
expenses of Robert W. Baird and the Underwriters, including the fees and
disbursement of counsel for the Underwriters, and (x) the performance of the
Company's other obligations hereunder;
(o) to use its best efforts to cause the Common Stock to be listed
for quotation on the National Association of Securities Dealers Automated
Quotation National Market System ("NASDAQ");
(p) to maintain a transfer agent and, if necessary under the
jurisdiction of incorporation of the Company, a registrar for the Common
Stock; and
(q) to ensure that the Directed Shares will be restricted to the
extent required by the NASD and its rules from sale, transfer, assignment,
pledge or hypothecation for a period of three months following the date of
the effectiveness of the Registration Statement; and to comply with all
applicable securities and other applicable laws, rules and regulations in
each jurisdiction in which the Reserved Shares are offered in connection
with the Directed Share Program.
6. CERTAIN COVENANTS OF THE COMPANY AND THE SELLING STOCKHOLDERS. The
Company and each of the Selling Stockholders agree with each Underwriter as
follows:
18
<Page>
(a) the Company and the Selling Stockholders, in such proportions
(aggregating 100%) as the number of Shares to be sold by the Company and by
each such Selling Stockholder bears to the total number of Shares or as they
otherwise may determine among themselves, will pay all expenses, fees and
taxes (other than any transfer taxes and fees and disbursements of counsel
for the Underwriters except as set forth under Section 7 hereof or (iii) or
(iv) below) in connection with (i) the preparation and filing of the
Registration Statement, each Preliminary Prospectus, the Prospectus, and any
amendments or supplements thereto, and the printing and furnishing of copies
of each thereof to the Underwriters and to dealers (including costs of
mailing and shipment), (ii) the issuance, sale and delivery of the Shares by
the Company and the Selling Stockholders, (iii) the word processing and/or
printing of this Agreement, any Agreement Among Underwriters, any dealer
agreements, any Statements of Information, the Custody Agreement and the
Power of Attorney and the reproduction and/or printing and furnishing of
copies of each thereof to the Underwriters and to dealers (including costs
of mailing and shipment), (iv) the qualification of the Shares for offering
and sale under state laws and the determination of their eligibility for
investment under state law as aforesaid (including the legal fees and filing
fees and other disbursements of counsel to the Underwriters) and the
printing and furnishing of copies of any blue sky surveys or legal
investment surveys to the Underwriters and to dealers, (v) any listing of
the Shares on any securities exchange or qualification of the Shares for
quotation on NASDAQ and any registration thereof under the Exchange Act,
(vi) the filing for review of the public offering of the Shares by the NASD,
and (vii) the performance of the Company's and the Selling Stockholders'
other obligations hereunder; and
(b) the Company and the Selling Stockholders will not issue, sell,
offer to sell, contract or agree to sell, hypothecate, pledge, grant any
option to purchase or otherwise dispose of or agree to dispose of, directly
or indirectly, any Common Stock or securities convertible into or
exchangeable or exercisable for Common Stock or warrants or other rights to
purchase Common Stock or any other securities of the Company that are
substantially similar to Common Stock, or file or cause to be declared
effective a registration statement under the Act relating to the offer and
sale of any shares of Common Stock or securities convertible into or
exercisable or exchangeable for Common Stock or other rights to purchase
Common Stock or any other securities of the Company that are substantially
similar to Common Stock for a period of 180 days after the date hereof (the
"Lock-Up Period"), without the prior written consent of Robert W. Baird,
except for (i) the registration of the Shares and the sales to the
Underwriters pursuant to this Agreement, (ii) issuances of Common Stock by
the Company upon the exercise of options or warrants disclosed as
outstanding in the Registration Statement and the Prospectus, (iii) the
issuance by the Company of employee stock options not exercisable during the
Lock-Up Period pursuant to stock option plans described in the Registration
Statement and the Prospectus, and (iv) the issuance by the Company of shares
of Common Stock as consideration in connection with any future acquisitions
by the Company, so long as the recipients of such Common Stock agree to be
bound by the provisions of this subsection (b).
19
<Page>
7. REIMBURSEMENT OF UNDERWRITERS' EXPENSES. If the Shares are not
delivered for any reason other than the termination of this Agreement pursuant
to (a) the fifth paragraph of Section 10 hereof, (b) clauses (y)(i), (iii), (iv)
or (v) of the second paragraph of Section 9, or (c) the default by one or more
of the Underwriters in its or their respective obligations hereunder, then the
Company shall (in addition to paying the amounts described in Section 5(n)
hereof) reimburse the Underwriters for all of their out-of-pocket expenses,
including the fees and disbursements of their counsel.
8. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The several obligations of
the Underwriters hereunder are subject to the accuracy of the representations
and warranties on the part of the Company and the Selling Stockholders on the
date hereof, at the time of purchase and, if applicable, at the additional time
of purchase, the performance by the Company and each of the Selling Stockholders
of its obligations hereunder and to the following additional conditions
precedent:
(a) The Company shall furnish to you at the time of purchase and, if
applicable, at the additional time of purchase, an opinion of Bell, Boyd &
Lloyd LLC, counsel for the Company, addressed to the Underwriters, and dated
the time of purchase or the additional time of purchase, as the case may be,
with reproduced copies for each of the other Underwriters and in form and
substance satisfactory to Davis Polk & Wardwell, counsel for the
Underwriters, stating that:
(i) the Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State
of Delaware, with full corporate power and authority to own, lease and
operate its properties and conduct its business as described in the
Registration Statement and the Prospectus, to execute and deliver this
Agreement and to issue, sell and deliver the Shares being sold by the
Company as contemplated herein;
(ii) each of the Subsidiaries has been duly incorporated and
is validly existing as a corporation in good standing under the laws
of its jurisdiction of incorporation, with full corporate power and
authority to own, lease and operate its properties and to conduct its
business as described in the Registration Statement and the
Prospectus;
(iii) the Company and the Subsidiaries are duly qualified to do
business as a foreign corporation and are in good standing in each
respective jurisdiction identified on Schedule E;
(iv) this Agreement has been duly authorized, executed and
delivered by the Company;
(v) the Shares have been duly authorized and, upon issuance
and delivery in accordance with the terms of this Agreement, will be
validly issued and are fully paid and non-assessable;
20
<Page>
(vi) the Company has an authorized and outstanding
capitalization as set forth in the Registration Statement and the
Prospectus; all of the issued and outstanding shares of capital stock
of the Company have been duly authorized and validly issued, are fully
paid and non-assessable and are free of statutory preemptive rights
and, to such counsel's knowledge, except as disclosed in the
Registration Statement and Prospectus, contractual preemptive rights,
resale rights, rights of first refusal and similar rights; the Shares
are free of statutory preemptive rights and, to such counsel's
knowledge, except as disclosed in the Registration Statement and
Prospectus, contractual preemptive rights, resale rights, rights of
first refusal and similar rights; the certificates for the Shares are
in due and proper form and the holders of the Shares will not be
subject to personal liability by reason of being such holders;
(vii) all of the outstanding shares of capital stock of each of
the Subsidiaries have been duly authorized and validly issued, and, to
such counsel's knowledge, are fully paid and non-assessable and,
except as otherwise stated in the Registration Statement and the
Prospectus, are owned, directly or indirectly, by the Company, and, to
such counsel's knowledge, are not subject to any security interest,
other encumbrance or adverse claim; and to such counsel's knowledge,
no options, warrants or other rights to purchase, agreements or other
obligations to issue or other rights to convert any obligation into
shares of capital stock or ownership interests in the Subsidiaries are
outstanding;
(viii) the capital stock of the Company, including the Shares,
conforms in all material respects to the description thereof contained
in the Registration Statement and the Prospectus;
(ix) the Registration Statement and the Prospectus (except as
to the financial statements and schedules and other financial or
statistical data contained therein, as to which such counsel need
express no opinion) comply as to form in all material respects with
the requirements of the Act;
(x) the Registration Statement has become effective under the
Act and, to such counsel's knowledge, no stop order proceedings with
respect thereto are pending or threatened under the Act and any
required filing of the Prospectus and any supplement thereto pursuant
to Rule 424 under the Act has been made in the manner and within the
time period required by such Rule 424;
(xi) no approval, authorization, consent or order of or filing
with any federal, state or local governmental or regulatory
commission, board, body, authority or agency is required in connection
with the issuance and sale of the Shares and consummation by the
Company of the transactions contemplated hereby other than
registration of the Shares under the Act (except such counsel need
express no opinion
21
<Page>
as to any necessary qualification under the state securities or blue
sky laws of the various jurisdictions in which the Shares are being
offered by the Underwriters);
(xii) the execution, delivery and performance of this Agreement
by the Company, the issuance and sale of the Shares by the Company and
the consummation by the Company of the transactions contemplated
hereby do not and will not conflict with, result in any breach or
violation of or constitute a default under (nor constitute any event
which with notice, lapse of time or both would result in any breach of
or constitute a default under) the charter or by-laws of the Company
or any of the Subsidiaries, or any indenture, mortgage, deed of trust,
bank loan or credit agreement or other evidence of indebtedness, or
any license, lease, contract or other agreement or instrument to which
the Company or any of the Subsidiaries is a party or by which any of
them or any of their respective properties may be bound or affected,
or any federal, state, local or foreign law, regulation known to such
counsel to be customarily applicable to transactions of this nature
or, to such counsel's knowledge, any rule or any decree, judgment or
order applicable to the Company or any of the Subsidiaries;
(xiii) to such counsel's knowledge, neither the Company nor any
of the Subsidiaries is in breach or violation of or in default under
(nor has any event occurred which with notice, lapse of time, or both
would result in any breach of, or constitute a default under or give
the holder of any indebtedness (or a person acting on such holder's
behalf) the right to require the repurchase, redemption or repayment
of all or a part of such indebtedness under) its respective charter or
by-laws, or, to the knowledge of such counsel, any indenture,
mortgage, deed of trust, bank loan or credit agreement or other
evidence of indebtedness, or any license, lease, contract or other
agreement or instrument to which the Company or any of the
Subsidiaries is a party or by which any of them or any of their
respective properties may be bound or affected, or any federal, state,
local or foreign law, regulation or rule or any decree, judgment or
order applicable to the Company or any of the Subsidiaries;
(xiv) to such counsel's knowledge, there are no affiliate
transactions, off-balance sheet transactions, contracts, licenses,
agreements, leases or documents of a character which are required to
be described in the Registration Statement or the Prospectus or to be
filed as an exhibit to the Registration Statement which have not been
so described or filed;
(xv) to such counsel's knowledge, there are no actions, suits,
claims, investigations or proceedings pending, threatened or
contemplated to which the Company or any of the Subsidiaries or any of
their respective directors or officers is a party or to which any of
their respective properties is subject at law or in equity, before or
by any federal, state, local or foreign governmental or regulatory
commission, board, body, authority or agency which are required to be
described in the Registration Statement or the Prospectus but are not
so described;
22
<Page>
(xvi) the Company is not and, after giving effect to the
offering and sale of the Shares, will not be an "investment company"
or an entity "controlled" by an "investment company," as such terms
are defined in the Investment Company Act;
(xvii) such counsel has read the information in the Registration
Statement and the Prospectus under the headings "Business--Regulation
and Environmental," "Business--Legal Proceedings," "Description of
Capital Stock," and "[ ]", insofar as such statements constitute
a summary of documents or matters of law, and those statements in the
Registration Statement and the Prospectus that are descriptions of
contracts, agreements or other legal documents or of legal
proceedings, or refer to statements of law or legal conclusions, are
accurate in all material respects and present fairly the information
required to be shown; and
(xviii) except as set forth in the Registration Statement no
person has the right, pursuant to the terms of any contract, agreement
or other instrument described in or filed as an exhibit to the
Registration Statement or otherwise known to such counsel, to cause
the Company to register under the Act any shares of Common Stock or
shares of any other capital stock or other equity interest of the
Company, or to include any such shares or interest in the Registration
Statement or the offering contemplated thereby, whether as a result of
the filing or effectiveness of the Registration Statement or the sale
of the Shares as contemplated thereby or otherwise.
In addition, such counsel shall state that such counsel has
participated in conferences with officers and other representatives of the
Company, representatives of the independent public accountants of the Company
and representatives of the Underwriters at which the contents of the
Registration Statement and the Prospectus were discussed and, although such
counsel is not passing upon and does not assume responsibility for the accuracy,
completeness or fairness of the statements contained in the Registration
Statement or the Prospectus (except as and to the extent stated in subparagraphs
(vi), (viii) and (xvii) above), on the basis of the foregoing nothing has come
to the attention of such counsel that causes them to believe that the
Registration Statement or any amendment thereto at the time such Registration
Statement or amendment 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 supplement thereto at the date of such Prospectus or such
supplement, and at the time of purchase or the additional time of purchase, as
the case may be, 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, in light of the circumstances under which they were made,
not misleading (it being understood that such counsel need express no opinion
with respect to the financial statements and schedules and other financial data
included in the Registration Statement or the Prospectus).
(b) The Selling Stockholders shall furnish to you at the time of
purchase and at the additional time of purchase, as the case may be, an
opinion of Bell, Boyd & Lloyd LLC, counsel for the Selling Stockholders,
addressed to the Underwriters, and dated the time of purchase or the
additional time of purchase, as the case may be, with reproduced copies for
23
<Page>
each of the other Underwriters, and in form and substance satisfactory to
Davis Polk & Wardwell, counsel for the Underwriters, stating that:
(i) this Agreement and the Custody Agreement have been duly
executed and delivered by or on behalf of each of the Selling
Stockholders;
(ii) each Selling Stockholder has full legal right and power,
and has obtained any authorization or approval required by law (other
than those imposed by the Act and the securities or blue sky laws of
certain jurisdictions), to sell, assign, transfer and deliver the
Shares to be sold by such Selling Stockholder in the manner provided
in this Agreement;
(iii) delivery of certificates for the Shares by each Selling
Stockholder pursuant hereto will pass valid and marketable title
thereto to the Underwriters, free and clear of any adverse claim,
assuming the Underwriters purchase such Shares for value, without
notice of any adverse claim;
(iv) each of the Representatives of the Selling Stockholders
has been duly authorized by each Selling Stockholder to execute and
deliver on behalf of such Selling Stockholder this Agreement and any
other document necessary or desirable in connection with the
transactions contemplated hereby and to deliver the Shares to be sold
by such Selling Stockholder; and
(v) to the best of such counsel's knowledge, the statements
in the Prospectus under the caption "Principal and Selling
Stockholders" insofar as such statements constitute a summary of the
matters referred to therein present fairly the information with
respect to such matters.
(c) You shall have received from Deloitte & Touche LLP letters dated,
respectively, the date of this Agreement, the time of purchase and, if
applicable, the additional time of purchase, and addressed to the
Underwriters (with reproduced copies for each of the Underwriters) in the
forms heretofore approved by Robert W. Baird.
(d) You shall have received at the time of purchase and, if
applicable, at the additional time of purchase, the favorable opinion of
Davis Polk & Wardwell, counsel for the Underwriters, dated the time of
purchase or the additional time of purchase, as the case may be, as to the
matters referred to in subparagraphs (iv), (v), (ix), and the last
subparagraph of paragraph (a) of this Section 8.
(e) No Prospectus or amendment or supplement to the Registration
Statement or the Prospectus shall have been filed to which you object in
writing.
(f) The Registration Statement shall become effective not later than
5:30 P.M. New York City time on the date of this Agreement and, if Rule 430A
under the Act is used, the Prospectus shall have been filed with the
Commission pursuant to Rule 424(b) under the
24
<Page>
Act at or before 5:30 P.M., New York City time, on the second full business
day after the date of this Agreement.
(g) Prior to the time of purchase, and, if applicable, the additional
time of purchase, (i) no stop order with respect to the effectiveness of the
Registration Statement shall have been issued under the Act or proceedings
initiated under Section 8(d) or 8(e) of the Act; (ii) the Registration
Statement and all amendments thereto shall not contain an untrue statement
of a material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading; and
(iii) the Prospectus and all amendments or supplements thereto shall not
contain an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they are made, not
misleading.
(h) Between the time of execution of this Agreement and the time of
purchase or the additional time of purchase, as the case may be, no material
adverse change or any development involving a prospective material adverse
change in the business, properties, management, financial condition or
results of operations of the Company and the Subsidiaries taken as a whole
shall occur or become known.
(i) The Company will, at the time of purchase and, if applicable, at
the additional time of purchase, deliver to you a certificate of its Chief
Executive Officer and its Chief Financial Officer in the form attached as
EXHIBIT B hereto.
(j) You shall have received signed Lock-up Agreements referred to in
Section 3(r) hereof.
(k) The Company and the Selling Stockholders shall have furnished to
you such other documents and certificates as to the accuracy and
completeness of any statement in the Registration Statement and the
Prospectus as of the time of purchase and, if applicable, the additional
time of purchase, as you may reasonably request.
(l) The Shares shall have been approved for quotation on NASDAQ,
subject only to notice of issuance at or prior to the time of purchase or
the additional time of purchase, as the case may be.
(m) The Selling Stockholders will at the time of purchase and the
additional time of purchase, as the case may be deliver to you a certificate
of the Representatives of the Selling Stockholders to the effect that the
representations and the warranties of the Selling Stockholders as set forth
in this Agreement are true and correct as of each such date.
9. EFFECTIVE DATE OF AGREEMENT; TERMINATION. This Agreement shall
become effective (i) if Rule 430A under the Act is not used, when you shall have
received notification of the effectiveness of the Registration Statement, or
(ii) if Rule 430A under the Act is used, when the parties hereto have executed
and delivered this Agreement.
25
<Page>
The obligations of the several Underwriters hereunder shall be subject
to termination in the absolute discretion of Robert W. Baird or any group of
Underwriters (which may include Robert W. Baird) which has agreed to purchase in
the aggregate at least 50% of the Firm Shares, if (x) since the time of
execution of this Agreement or the earlier respective dates as of which
information is given in the Registration Statement and the Prospectus, there has
been any material adverse change or any development involving a prospective
material adverse change in the business, properties, management, financial
condition or results of operations of the Company and the Subsidiaries taken as
a whole, which would, in Robert W. Baird's judgment or in the judgment of such
group of Underwriters, make it impracticable or inadvisable to proceed with the
public offering or the delivery of the Shares on the terms and in the manner
contemplated in the Registration Statement and the Prospectus, or (y) there
shall have occurred: (i) a suspension or material limitation in trading in
securities generally on the New York Stock Exchange, the American Stock Exchange
or the NASDAQ; (ii) a suspension or material limitation in trading in the
Company's securities on NASDAQ; (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) an outbreak or escalation of hostilities or
acts of terrorism involving the United States or a declaration by the United
States of a national emergency or war; or (v) 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
Robert W. Baird's judgment or in the judgment of such group of Underwriters
makes it impracticable or inadvisable to proceed with the public offering or the
delivery of the Shares on the terms and in the manner contemplated in the
Registration Statement and the Prospectus.
If Robert W. Baird or any group of Underwriters elects to terminate
this Agreement as provided in this Section 9, the Company, the Representatives
of the Selling Stockholders and each other Underwriter shall be notified
promptly in writing.
If the sale to the Underwriters of the Shares, as contemplated by this
Agreement, is not carried out by the Underwriters for any reason permitted under
this Agreement or if such sale is not carried out because the Company or the
Selling Stockholders, as the case may be, shall be unable to comply with any of
the terms of this Agreement, the Company or the Selling Stockholders, as the
case may be, shall not be under any obligation or liability under this Agreement
(except to the extent provided in Sections 5(n), 7 and 11 hereof), and the
Underwriters shall be under no obligation or liability to the Company and the
Selling Stockholders under this Agreement (except to the extent provided in
Section 9 hereof) or to one another hereunder.
10. INCREASE IN UNDERWRITERS' COMMITMENTS. Subject to Sections 8 and 9
hereof, if any Underwriter shall default in its obligation to take up and pay
for the Firm Shares to be purchased by it hereunder (otherwise than for a
failure of a condition set forth in Section 8 hereof or a reason sufficient to
justify the termination of this Agreement under the provisions of Section 9
hereof) and if the number of Firm Shares which all Underwriters so defaulting
shall have agreed but failed to take up and pay for does not exceed 10% of the
total number of Firm Shares, the non-defaulting Underwriters shall take up and
pay for (in addition to the aggregate number of Firm Shares they are obligated
to purchase pursuant to Section 1 hereof) the number of Firm Shares agreed to be
purchased by all such
26
<Page>
defaulting Underwriters, as hereinafter provided. Such Shares shall be taken up
and paid for by such non-defaulting Underwriters in such amount or amounts as
you may designate with the consent of each Underwriter so designated or, in the
event no such designation is made, such Shares shall be taken up and paid for by
all non-defaulting Underwriters pro rata in proportion to the aggregate number
of Firm Shares set forth opposite the names of such non-defaulting Underwriters
in Schedule A.
Without relieving any defaulting Underwriter from its obligations
hereunder, the Company and each of the Selling Stockholders agrees with the
non-defaulting Underwriters that it will not sell any Firm Shares hereunder
unless all of the Firm Shares are purchased by the Underwriters (or by
substituted Underwriters selected by you with the approval of the Company or
selected by the Company with your approval).
If a new Underwriter or Underwriters are substituted by the
Underwriters or by the Company for a defaulting Underwriter or Underwriters in
accordance with the foregoing provision, the Company or you shall have the right
to postpone the time of purchase for a period not exceeding five business days
in order that any necessary changes in the Registration Statement and the
Prospectus and other documents may be effected.
The term Underwriter as used in this Agreement shall refer to and
include any Underwriter substituted under this Section 10 with like effect as if
such substituted Underwriter had originally been named in Schedule A.
If the aggregate number of Firm Shares which the defaulting
Underwriter or Underwriters agreed to purchase exceeds 10% of the total number
of Firm Shares which all Underwriters agreed to purchase hereunder, and if
neither the non-defaulting Underwriters nor the Company shall make arrangements
within the five business day period stated above for the purchase of all the
Firm Shares which the defaulting Underwriter or Underwriters agreed to purchase
hereunder, this Agreement shall terminate without further act or deed and
without any liability on the part of the Company to any non-defaulting
Underwriter and without any liability on the part of any non-defaulting
Underwriter to the Company. Nothing in this paragraph, and no action taken
hereunder, shall relieve any defaulting Underwriter from liability in respect of
any default of such Underwriter under this Agreement.
11. INDEMNITY AND CONTRIBUTION.
(a) The Company and the Selling Stockholders jointly and severally
agree to indemnify, defend and hold harmless each Underwriter, its partners,
directors and officers, and any person who controls any Underwriter within
the meaning of Section 15 of the Act or Section 20 of the Exchange Act, and
the successors and assigns of all of the foregoing persons, from and against
any loss, damage, expense, liability or claim (including the reasonable cost
of investigation) which, jointly or severally, any such Underwriter or any
such person may incur under the Act, the Exchange Act, the common law or
otherwise, insofar as such loss, damage, expense, liability or claim arises
out of or is based upon (i) any untrue statement or alleged untrue statement
of a material fact contained in the Registration Statement (or in the
27
<Page>
Registration Statement as amended by any post-effective amendment thereof by
the Company) or in a Prospectus (the term Prospectus for the purpose of this
Section 9 being deemed to include any Preliminary Prospectus, the Prospectus
and the Prospectus as amended or supplemented by the Company), or arises out
of or is based upon any omission or alleged omission to state a material
fact required to be stated in either such Registration Statement or such
Prospectus or necessary to make the statements made therein not misleading,
except insofar as any such loss, damage, expense, liability or claim arises
out of or is based upon any untrue statement or alleged untrue statement of
a material fact contained in and in conformity with information concerning
such Underwriter furnished in writing by or on behalf of such Underwriter
through you to the Company expressly for use in such Registration Statement
or such Prospectus or arises out of or is based upon any omission or alleged
omission to state a material fact in connection with such information
required to be stated in such Registration Statement or such Prospectus or
necessary to make such information not misleading; PROVIDED, HOWEVER, that
the indemnity agreement contained in this subsection (a) with respect to any
Preliminary Prospectus or amended Preliminary Prospectus shall not inure to
the benefit of any Underwriter (or to the benefit of any person controlling
such underwriter) from whom the person asserting any such loss, damage,
expense, liability or claim purchased the Shares which is the subject
thereof if the Prospectus corrected any such alleged untrue statement or
omission and if such Underwriter failed to send or give a copy of the
Prospectus to such person at or prior to the written confirmation of the
sale of such Shares to such person, unless the failure is the result of
noncompliance by the company with paragraph (b) of Section 5 hereof, (ii)
any untrue statement or alleged untrue statement made by the Company in
Section 3 hereof or the failure by the Company to perform when and as
required any agreement or covenant contained herein, or (iii) any untrue
statement or alleged untrue statement of any material fact contained in any
audio or visual materials provided by the Company or written information
furnished by or on behalf of the Company including, without limitation,
slides, videos, films or tape recordings used in connection with the
marketing of the Shares. PROVIDED, HOWEVER, that no Selling Stockholder
shall be responsible, either pursuant to this indemnity or other provisions
of this Section 11 or as a result of any breach of this Agreement, for
losses, expenses, liability or claims arising out of or based upon such
untrue statement or omission or allegation thereof based upon information
furnished by any party other than such Selling Stockholder and, in any
event, no Selling Stockholder shall be responsible, either pursuant to this
indemnity or other provisions of this Section 11 or as a result of any
breach of this Agreement, for losses, expenses, liability or claims for an
amount in excess of the proceeds to be received by such Selling Stockholder
(before deducting expenses) from the sale of Shares hereunder.
If any action, suit or proceeding (each, a "Proceeding") is brought
against an Underwriter or any such person in respect of which indemnity may be
sought against the Company or any Selling Stockholder pursuant to the foregoing
paragraph, such Underwriter or such person shall promptly notify the Company and
the Representatives of the Selling Stockholders in writing of the institution of
such Proceeding and the Company or such Selling Stockholder, as the case may be,
shall assume the defense of such Proceeding, including the employment of counsel
reasonably satisfactory to such indemnified party and payment of all fees and
expenses; PROVIDED, HOWEVER, that the omission
28
<Page>
to so notify the Company or the Representative of the Selling Stockholders shall
not relieve the Company or such Selling Stockholder from any liability which the
Company or such Selling Stockholder may have to any Underwriter or any such
person or otherwise except to the extent the Company or Selling Shareholder is
prejudiced by such omission. Such Underwriter or such person shall have the
right to employ its or their own counsel in any such case, but the fees and
expenses of such counsel shall be at the expense of such Underwriter or of such
person unless the employment of such counsel shall have been authorized in
writing by the Company or such Selling Stockholder in connection with the
defense of such Proceeding or the Company or such Selling Stockholder shall not
have, within a reasonable period of time in light of the circumstances, employed
counsel to have charge of the defense of such Proceeding or such indemnified
party or parties shall have reasonably concluded that there may be defenses
available to it or them which are different from, additional to or in conflict
with those available to the Company or such Selling Stockholder (in which case
the Company or such Selling Stockholder shall not have the right to direct the
defense of such Proceeding on behalf of the indemnified party or parties), in
any of which events such fees and expenses shall be borne by the Company or such
Selling Stockholder and paid as incurred (it being understood, however, that the
Company or such Selling Stockholder shall not be liable for the expenses of more
than one separate counsel (in addition to any local counsel) in any one
Proceeding or series of related Proceedings in the same jurisdiction
representing the indemnified parties who are parties to such Proceeding). The
Company or such Selling Stockholder shall not be liable for any settlement of
any Proceeding effected without its written consent but if settled with the
written consent of the Company or such Selling Stockholder, the Company or such
Selling Stockholder agrees to indemnify and hold harmless any Underwriter and
any such person from and against any loss or liability by reason of such
settlement. 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 second
sentence of this paragraph, then 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, (ii) such indemnifying
party shall not have fully reimbursed the indemnified party in accordance with
such request prior to the date of such settlement and (iii) such indemnified
party shall have given the indemnifying party at least 30 days' prior notice of
its intention to settle. 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 and does not include an admission of fault, culpability or a
failure to act, by or on behalf of such indemnified party.
The Company agrees to indemnify, defend and hold harmless each
Underwriter, its partners, directors and officers, and any person who controls
any Underwriter within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act, and the successors and assigns of all of the foregoing persons,
from and against any loss, damage, expense, liability or claim (including the
reasonable cost of investigation) which, jointly or severally, any Underwriter
or any such person may incur under the Act, the Exchange Act, the common law or
otherwise, insofar as such loss, damage, expense, liability or claim (i) arises
out of or is based upon any untrue statement or alleged untrue
29
<Page>
statement of a material fact contained in any material prepared by or with the
consent of the Company for distribution to Directed Share Participants in
connection with the Directed Share Program or caused by any omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading; (ii) caused by the
failure of any Directed Share Participant to pay for and accept delivery of
Reserved Shares that the Directed Share Participant has agreed to purchase; or
(iii) otherwise arises out of or is based upon the Directed Share Program,
provided that the Company shall not be responsible under this clause (iii) for
any loss, damage, expense, liability or claim that is finally judicially
determined to have resulted from the gross negligence or willful misconduct of
any Underwriter in conducting the Directed Share Program. The second paragraph
of this Section 11(a) shall apply equally to any Proceeding brought against any
Underwriter or any such person in respect of which indemnity may be sought
against the Company pursuant to the foregoing sentence; except that the Company
shall be liable for the expenses of one separate counsel (in addition to any
local counsel) for any Underwriter and any such person, separate and in addition
to counsel for the Underwriters, in any such Proceeding.
(b) Each Underwriter severally agrees to indemnify, defend and hold
harmless the Company, its directors and officers, each Selling Stockholder
and any person who controls the Company or any Selling Shareholder within
the meaning of Section 15 of the Act or Section 20 of the Exchange Act, and
the successors and assigns of all of the foregoing persons, from and against
any loss, damage, expense, liability or claim (including the reasonable cost
of investigation) which, jointly or severally, the Company, any Selling
Stockholder or any such person may incur under the Act, the Exchange Act,
the common law or otherwise, insofar as such loss, damage, expense,
liability or claim arises out of or is based upon any untrue statement or
alleged untrue statement of a material fact contained in and in conformity
with information concerning such Underwriter furnished in writing by or on
behalf of such Underwriter through you to the Company expressly for use in
the Registration Statement (or in the Registration Statement as amended by
any post-effective amendment thereof by the Company) or in a Prospectus, or
arises out of or is based upon any omission or alleged omission to state a
material fact in connection with such information required to be stated in
such Registration Statement or such Prospectus or necessary to make such
information not misleading.
If any Proceeding is brought against the Company, any Selling
Stockholder or any such person in respect of which indemnity may be sought
against any Underwriter pursuant to the foregoing paragraph, the Company, any
Selling Stockholder or such person shall promptly notify such Underwriter in
writing of the institution of such Proceeding and such Underwriter shall assume
the defense of such Proceeding, including the employment of counsel reasonably
satisfactory to such indemnified party and payment of all fees and expenses;
PROVIDED, HOWEVER, that the omission to so notify such Underwriter shall not
relieve such Underwriter from any liability which such Underwriter may have to
the Company, any Selling Stockholder or any such person or otherwise except to
the extent such Underwriter is prejudiced by such omission. The Company, any
Selling Stockholder or such person shall have the right to employ its own
counsel in any such case, but the fees and expenses of such counsel shall be at
the expense of the Company, any Selling Stockholder or such person unless the
employment of such counsel shall have been authorized in writing by such
Underwriter in connec-
30
<Page>
tion with the defense of such Proceeding or such Underwriter shall not have,
within a reasonable period of time in light of the circumstances, employed
counsel to defend such Proceeding or such indemnified party or parties shall
have reasonably concluded that there may be defenses available to it or them
which are different from or additional to or in conflict with those available to
such Underwriter (in which case such Underwriter shall not have the right to
direct the defense of such Proceeding on behalf of the indemnified party or
parties, but such Underwriter may employ counsel and participate in the defense
thereof but the fees and expenses of such counsel shall be at the expense of
such Underwriter), in any of which events such fees and expenses shall be borne
by such Underwriter and paid as incurred (it being understood, however, that
such Underwriter shall not be liable for the expenses of more than one separate
counsel (in addition to any local counsel) in any one Proceeding or series of
related Proceedings in the same jurisdiction representing the indemnified
parties who are parties to such Proceeding). No Underwriter shall be liable for
any settlement of any such Proceeding effected without the written consent of
such Underwriter but if settled with the written consent of such Underwriter,
such Underwriter agrees to indemnify and hold harmless the Company, any Selling
Stockholder and any such person from and against any loss or liability by reason
of such settlement. 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 second
sentence of this paragraph, then 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, (ii) such indemnifying
party shall not have reimbursed the indemnified party in accordance with such
request prior to the date of such settlement and (iii) such indemnified party
shall have given the indemnifying party at least 30 days' prior notice of its
intention to settle. 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.
(c) If the indemnification provided for in this Section 11 is
unavailable to an indemnified party under subsections (a) and (b) of this
Section 11 or insufficient to hold an indemnified party harmless in respect
of any losses, damages, expenses, liabilities or claims referred to therein,
then each applicable indemnifying party shall contribute to the amount paid
or payable by such indemnified party as a result of such losses, damages,
expenses, liabilities or claims (i) in such proportion as is appropriate to
reflect the relative benefits received by the Company [and the Selling
Shareholders] on the one hand and the Underwriters on the other hand from
the offering of the Shares or (ii) if the allocation provided by clause (i)
above is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause
(i) above but also the relative fault of the Company and the Selling
Stockholders on the one hand and of the Underwriters on the other in
connection with the statements or omissions which resulted in such losses,
damages, expenses, liabilities or claims, as well as any other relevant
equitable considerations. The relative benefits received by the Company and
the Selling Stockholders on the one hand and the Underwriters on the other
shall be deemed to be in the same respective proportions as the total
proceeds from the
31
<Page>
offering (net of underwriting discounts and commissions but before deducting
expenses) received by the Company and the Selling Stockholders and the total
underwriting discounts and commissions received by the Underwriters, bear to
the aggregate public offering price of the Shares. The relative fault of the
Company and the Selling Stockholders on the one hand and of the Underwriters
on the other shall be determined by reference to, among other things,
whether the untrue statement or alleged untrue statement of a material fact
or omission or alleged omission relates to information supplied by the
Company and/or the Selling Stockholders or by the Underwriters and the
parties' relative intent, knowledge, access to information and opportunity
to correct or prevent such statement or omission. The amount paid or payable
by a party as a result of the losses, damages, expenses, liabilities and
claims referred to in this subsection shall be deemed to include any legal
or other fees or expenses reasonably incurred by such party in connection
with investigating, preparing to defend or defending any Proceeding.
(d) The Company, the Selling Stockholders and the Underwriters agree
that it would not be just and equitable if contribution pursuant to this
Section 11 were determined by pro rata allocation (even if the Underwriters
were treated as one entity for such purpose) or by any other method of
allocation that does not take account of the equitable considerations
referred to in subsection (c) above. Notwithstanding the provisions of this
Section 11, no Underwriter shall be required to contribute any amount in
excess of the amount by which the total price at which the Shares
underwritten by such Underwriter and distributed to the public were offered
to the public exceeds the amount of any damage which such Underwriter has
otherwise been required to pay by reason of such untrue statement or alleged
untrue statement or omission or alleged omission. 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. The Underwriters' obligations to
contribute pursuant to this Section 11 are several in proportion to their
respective underwriting commitments and not joint.
(e) The indemnity and contribution agreements contained in this
Section 11 and the covenants, warranties and representations of the Company
and the Selling Stockholders contained in this Agreement shall remain in
full force and effect regardless of any investigation made by or on behalf
of any Underwriter, its partners, directors or officers or any person
(including each partner, officer or director of such person) who controls
any Underwriter within the meaning of Section 15 of the Act or Section 20 of
the Exchange Act, or by or on behalf of the Company, its directors or
officers, any Selling Stockholder or any person who controls the Company
within the meaning of Section 15 of the Act or Section 20 of the Exchange
Act, and shall survive any termination of this Agreement or the issuance and
delivery of the Shares. The Company, each of the Selling Stockholders and
each Underwriter agree promptly to notify each other of the commencement of
any Proceeding against it and, in the case of the Company or the Selling
Stockholders, against any of the Company's or Selling Stockholder's officers
or directors, as the case may be, in connection with the issuance and sale
of the Shares, or in connection with the Registration Statement or the
Prospectus.
32
<Page>
12. INFORMATION FURNISHED BY THE UNDERWRITERS. The statements set forth in
the last paragraph on the cover page of the Prospectus and the statements set
forth in the [Fifth and Ninth] paragraph under the caption "Underwriting" in the
Prospectus constitute the only information furnished by or on behalf of the
Underwriters as such information is referred to in Sections 3 and 11 hereof.
13. NOTICES. Except as otherwise herein provided, all statements,
requests, notices and agreements shall be in writing or by telegram and, if to
the Underwriters, shall be sufficient in all respects if delivered or sent to
Robert W. Baird & Co. Incorporated, 777 East Wisconsin Avenue, 28th Floor,
Milwaukee, WI, 53202-5391, Attention: Investment Banking; if to the Company,
shall be sufficient in all respects if delivered or sent to the Company at the
offices of the Company at 120 North LaSalle Street, Chicago, IL 60602,
Attention: Victor M. Casini; and if to the Selling Stockholders, shall be
sufficient in all respects if delivered or sent to the Representatives of the
Selling Stockholders at __________, Attention: __________.
14. GOVERNING LAW; CONSTRUCTION. This Agreement and any claim,
counterclaim or dispute of any kind or nature whatsoever arising out of or in
any way relating to this Agreement ("Claim"), directly or indirectly, shall be
governed by, and construed in accordance with, the laws of the State of New
York. The Section headings in this Agreement have been inserted as a matter of
convenience of reference and are not a part of this Agreement.
15. SUBMISSION TO JURISDICTION. Except as set forth below, no Claim may be
commenced, prosecuted or continued in any court other than the courts of the
State of Illinois located in Cook County or in the United States District Court
for the Northern District of Illinois, which courts shall have jurisdiction over
the adjudication of such matters, and the Company consents to the jurisdiction
of such courts and personal service with respect thereto. The Company and each
of the Selling Stockholders hereby consents to personal jurisdiction, service
and venue in any court in which any Claim arising out of or in any way relating
to this Agreement is brought by any third party against Robert W. Baird or any
indemnified party. Each of Robert W. Baird, the Selling Stockholders and the
Company (on its behalf and, to the extent permitted by applicable law, on behalf
of its stockholders and affiliates) waives all right to trial by jury in any
action, proceeding or counterclaim (whether based upon contract, tort or
otherwise) in any way arising out of or relating to this Agreement. The Company
and each of the Selling Stockholders agrees that a final judgment in any such
action, proceeding or counterclaim brought in any such court shall be conclusive
and binding upon the Company and may be enforced in any other courts to the
jurisdiction of which the Company is or may be subject, by suit upon such
judgment.
16. PARTIES AT INTEREST. The Agreement herein set forth has been and is
made solely for the benefit of the Underwriters, the Selling Stockholders and
the Company and to the extent provided in Section 11 hereof the controlling
persons, directors and officers referred to in such section, and their
respective successors, assigns, heirs, personal representatives and executors
and administrators. No other person, partnership, association or corporation
(including a purchaser, as such purchaser, from any of the Underwriters) shall
acquire or have any right under or by virtue of this Agreement.
33
<Page>
17. COUNTERPARTS. This Agreement may be signed by the parties in one or
more counterparts which together shall constitute one and the same agreement
among the parties.
18. SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon the
Underwriters, each of the Selling Stockholders and the Company and their
successors and assigns and any successor or assign of any substantial portion of
the Company's, each the Selling Stockholder's and any of the Underwriters'
respective businesses and/or assets.
34
<Page>
If the foregoing correctly sets forth the understanding among the
Company, the Selling Stockholders and the Underwriters, please so indicate in
the space provided below for the purpose, whereupon this agreement and your
acceptance shall constitute a binding agreement among the Company and the
Underwriters, severally.
Very truly yours,
LKQ CORPORATION
By:
------------------------------------
Name:
Title:
THE SELLING STOCKHOLDERS NAMED IN
SCHEDULE B ATTACHED HERETO
By:
------------------------------------
Name:
Attorney-in-Fact
Accepted and agreed to as of the
date first above written, on
behalf of themselves
and the other several Underwriters
named in Schedule A
Robert W. Baird & Co. Incorporated
By: Robert W. Baird & Co. Incorporated
By:
---------------------------
Title:
35
<Page>
SCHEDULE A
<Table>
<Caption>
Number of
Underwriter Firm Shares
- ----------- -----------
Robert W. Baird & Co. Incorporated
Jeffries & Company, Inc.
-----------
Total........................
===========
</Table>
36
<Page>
SCHEDULE B
<Table>
<Caption>
Number of Number of
Selling Stockholders Firm Shares Additional Shares
- -------------------- ----------- -----------------
----------- -----------------
Total......................
=========== =================
</Table>
37
<Page>
SCHEDULE C
LKQ CORPORATION AND ITS SUBSIDIARIES
<Table>
<Caption>
JURISDICTION
------------
1. Akron Airport Properties, Inc. Ohio
2. Black Horse Auto Parts, Inc. Florida
3. Damron Holding Company, LLC Delaware
4. DAP Trucking, Inc. Florida
5. DAP Trucking, LLC Florida
6. LKQ 250 Auto, Inc. Ohio
7. LKQ All Models Corp. Arizona
8. LKQ Atlanta, L.P. Delaware
9. LKQ Auto Parts of Central California, Inc. California
10. LKQ Auto Parts of Memphis, Inc. Arkansas
11. LKQ Auto Parts of North Texas, Inc. Delaware
12. LKQ Auto Parts of North Texas, L.P. Delaware
13. LKQ Auto Parts of Orlando, LLC Florida
14. LKQ Auto Parts of Utah, Inc. Utah
15. LKQ Best Automotive Corp. Delaware
16. LKQ Best Automotive, L.P. Delaware
17. LKQ Birmingham, Inc. Alabama
18. LKQ Broadway Auto Parts, Inc. New York
19. LKQ Corporation Delaware
20. LKQ Crystal River, Inc. Florida
21. LKQ Gorham Auto Parts Corp. Maine
22. LKQ Great Lakes Corp. Indiana
23. LKQ Holding Co. Delaware
24. LKQ Hunts Point Auto Parts Corp. New York
25. LKQ John's Westside Corp. Oregon
26. LKQ Lakenor Auto & Truck Salvage, Inc. California
27. LKQ Management Company Delaware
28. LKQ Mid-America Auto Parts, Inc. Kansas
29. LKQ Mid-Atlantic, Inc. Pennsylvania
30. LKQ Midwest Auto Parts Corp. Nebraska
31. LKQ of Indiana, Inc. Indiana
32. LKQ of Michigan, Inc. Michigan
33. LKQ of Nevada, Inc. Nevada
34. LKQ of Stockton, Inc. California
35. LKQ of Tennessee, Inc. Tennessee
36. LKQ Raleigh Auto Parts Corp. North Carolina
37. LKQ Route 16 Used Auto Parts, Inc. Massachusetts
38. LKQ Salisbury, Inc. North Carolina
39. LKQ Savannah, Inc. Georgia
</Table>
38
<Page>
<Table>
40. LKQ Smart Parts, Inc. Delaware
41. LKQ Smart Parts, L.P. Delaware
42. LKQ Star Auto Parts, Inc. Delaware
43. LKQ Star Auto Parts, L.P. Delaware
44. LKQ TriplettASAP, Inc. Ohio
45. Redding Auto Center, Inc. California
</Table>
39
<Page>
SCHEDULE D
40
<Page>
EXHIBIT A
LKQ CORPORATION
Common Stock
($.01 Par Value)
[Date]
Robert W. Baird & Co. Incorporated
As Representative of the several Underwriters
c/o Robert W. Baird & Co. Incorporated
777 East Wisconsin Avenue
Milwaukee, Wisconsin 53202
Ladies and Gentlemen:
This Lock-Up Letter Agreement is being delivered to you in connection
with the proposed Underwriting Agreement (the "Underwriting Agreement") to be
entered into by LKQ Corporation (the "Company") and you, as Representative of
the several Underwriters named therein, with respect to the public offering (the
"Offering") of Common Stock, par value $.01 per share, of the Company (the
"Common Stock").
In order to induce you to enter into the Underwriting Agreement, the
undersigned agrees that for a period of 180 days after the date of the final
prospectus relating to the Offering, the undersigned will not, without the prior
written consent of Robert W. Baird & Co., (i) sell, offer to sell, contract or
agree to sell, hypothecate, pledge, grant any option to purchase or otherwise
dispose of or agree to dispose of, directly or indirectly, or file (or
participate in the filing of) a registration statement with the Securities and
Exchange Commission (the "Commission") in respect of, or establish or increase a
put equivalent position or liquidate or decrease a call equivalent position
within the meaning of Section 16 of the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the Commission promulgated thereunder
with respect to, any Common Stock of the Company or any securities convertible
into or exercisable or exchangeable for Common Stock, or warrants or other
rights to purchase Common Stock, (ii) enter into any swap or other arrangement
that transfers to another, in whole or in part, any of the economic consequences
of ownership of Common Stock or any securities convertible into or exercisable
or exchangeable for Common Stock, or warrants or other rights to purchase Common
Stock, whether any such transaction is to be settled by delivery of Common Stock
or such other securities, in cash or otherwise, or (iii) publicly announce an
intention to effect any transaction specified in clause (i) or (ii). The
foregoing sentence shall not apply to (a) the registration of or sale to the
Underwriters of any Common Stock pursuant to the Offering and the Underwriting
Agreement, (b) bona fide gifts, provided the recipient thereof agrees in writing
with the Underwriters to be bound by the terms of this Lock-Up Letter Agreement
and confirms that he, she or it has been in compliance with the terms of this
Lock-Up Letter Agreement
41
<Page>
since the date hereof or (c) dispositions to any trust for the direct or
indirect benefit of the undersigned and/or the immediate family of the
undersigned, provided that such trust agrees in writing with the Underwriters to
be bound by the terms of this Lock-Up Letter Agreement and confirms that it has
been in compliance with the terms of this Lock-Up Letter Agreement since the
date hereof.
In addition, the undersigned hereby waives any rights the undersigned
may have to require registration of Common Stock in connection with the filing
of a registration statement relating to the Offering. The undersigned further
agrees that, for a period of 180 days after the date of the final prospectus
relating to the Offering, the undersigned will not, without the prior written
consent of Robert W. Baird & Co., make any demand for, or exercise any right
with respect to, the registration of Common Stock of the Company or any
securities convertible into or exercisable or exchangeable for Common Stock, or
warrants or other rights to purchase Common Stock.
If (i) the Company notifies you in writing that it does not intend to
proceed with the Offering, (ii) the registration statement filed with the
Securities and Exchange Commission with respect to the Offering is withdrawn or
(iii) for any reason the Underwriting Agreement shall be terminated prior to the
time of purchase (as defined in the Underwriting Agreement), this Lock-Up Letter
Agreement shall be terminated and the undersigned shall be released from its
obligations hereunder.
Yours very truly,
--------------------------
Name:
42
<Page>
Exhibit B
OFFICERS' CERTIFICATE
1. I have reviewed the Registration Statement and the Prospectus.
2. The representations and warranties of the Company as set forth in this
Agreement are true and correct as of the time of purchase and, if
applicable, the additional time of purchase.
3. The Company has performed all of its obligations under this Agreement as are
to be performed at or before the time of purchase and at or before the
additional time of purchase, as the case may be.
4. The conditions set forth in paragraphs (f) and (g) of Section 8 of this
Agreement have been met.
5. The financial statements and other financial information included in the
Registration Statement and the Prospectus fairly present in all material
respects the financial condition, results of operations, and cash flows of
the Company as of, and for, the periods presented in the Registration
Statement.
43