<PAGE>
EXHIBIT 1.1
AMERICAN RAILCAR INDUSTRIES, INC.
[__] Shares
of
Common Stock
($0.01 Par Value)
UNDERWRITING AGREEMENT
<PAGE>
UNDERWRITING AGREEMENT
[__], 2006
UBS Securities LLC
Bear, Stearns & Co. Inc.
BB&T Capital Markets,
a division of
Scott & Stringfellow, Inc.
CIBC World Markets Corp.
Morgan Keegan & Company, Inc.
as Underwriters
c/o UBS Securities LLC
299 Park Avenue
New York, New York
10171
Ladies and Gentlemen:
American Railcar Industries, Inc., a Delaware corporation (the
"New
ARI"), proposes to issue and sell (the "Offering") to the
underwriters named in
Schedule A annexed hereto (the "Underwriters") an aggregate of [__]
(the "Firm
Shares") of common stock, $0.01 par value per share, of New ARI
(the "Common
Stock"). In addition, solely for the purpose of covering
over-allotments, New
ARI proposes to grant to the Underwriters the option to purchase
from New ARI up
to an additional [__] shares of Common Stock (the "Additional
Shares"). The Firm
Shares and the Additional Shares are hereinafter collectively
sometimes referred
to as the "Shares." The Shares are as described in the Prospectus
(as defined
below).
New ARI hereby acknowledges that in connection with the
proposed
offering of the Shares, it has requested UBS Financial Services
Inc.
("UBS-FinSvc") 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 UBS-FinSvc at the initial public offering price to New
ARI's officers,
directors, employees and consultants and other persons having a
relationship
with New ARI designated by New ARI (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. (the "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. New
ARI has
supplied UBS-FinSvc with names, addresses and telephone numbers of
the
individuals or other entities that New ARI 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.
As described in the
Registration Statement (as defined below),
American Railcar Industries, Inc., a Missouri corporation and sole
stockholder
of New ARI ("Old ARI"), will on or prior to the Time of Purchase
(as defined
below), pursuant to a Certificate of Ownership and Merger, to be
filed by Old
ARI, with the Secretary of State of the State of Delaware on or
prior to the
Time of Purchase in the form filed with the Securities and Exchange
Commission
(the "Commission") as an exhibit to the Registration Statement (the
"Certificate
of Merger"), merge with and into New ARI, with New ARI being the
surviving
corporation. Pursuant to this merger (i) the [__] shares of Old
ARI's common
stock, $0.01 par value per share will be exchanged for [__] shares
of a single
class of New ARI's common stock, par value $0.01 per share and (ii)
[__] shares
of Old ARI's new preferred stock will be exchanged for [__]
<PAGE>
shares of New ARI's new preferred stock (the merger of Old ARI with
and into New
ARI and the share exchanges are collectively referred to as the
"Merger").
Prior to or concurrently with and as a condition to the
consummation
of the Offering contemplated hereby, New ARI will (i) repay all
revolving loans
under the revolving credit facility pursuant to the credit
agreement dated March
10, 2005 among Old ARI, North Fork Business Capital Corporation
(as
administrative agent) and the other lenders party thereto (the
"Credit
Facility"), (ii) amend and restate the Credit Facility as described
in the
Registration Statement and the Preliminary Prospectus (the "New
Credit
Facility"), (iii) deposit an amount equal to the aggregate
principal amount and
all accrued and unpaid interest outstanding under the industrial
revenue bonds
due 2011 (the "Industrial Revenue Bonds") issued by the Company
with [__] as
trustee (the "Trustee") thereunder and deliver irrevocable
instructions to the
Trustee notifying the holders thereunder of the full repayment and
redemption of
such Industrial Revenue Bonds by no later than [__], (iv) repay all
principal
and accrued interest outstanding under that certain promissory note
issued to
Arnos Corp. dated December 17, 2004 (the "Arnos Note"), (v) repay
all principal
and outstanding interest outstanding under that certain promissory
note issued
to ACF Industries Holding Corp. dated January 1, 2005 (together
with the Arnos
Note, the "Affiliate Notes"), (vi) complete the Merger, (vii) issue
to James J.
Unger [__] shares of common stock pursuant an agreement between the
Company and
James J. Unger dated November 18, 2005 (the "Unger Stock Grant"),
(viii) redeem
[82,055] shares of the Old ARI's new preferred stock, $0.01 par
value per share
(the "Preferred Stock Redemption"); the forgoing clauses are each
referred to as
a "Concurrent Transaction" and collectively referred to as the
"Concurrent
Transactions."
Old ARI and New ARI have prepared and 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
Commission
registration statements on Form S-1 (File Nos. 333-130284 and No.
333-128177),
including a prospectus, relating to the registration of the Shares
under the
Act.
Old ARI and New ARI have furnished to you, for use by the
Underwriters and by dealers, copies of one or more preliminary
prospectuses
relating to the Shares. Except where the context otherwise
requires,
"Preliminary Prospectus," as used herein, means each such
preliminary
prospectus, in the form so furnished.
Except where the context otherwise requires, "Registration
Statement," as used herein, means the registration statement, as
amended at the
time of such registration statement's effectiveness for purposes of
Section 11
of the Act, as such section applies to the respective Underwriters
(the
"Effective Time"), including (i) all documents filed as a part
thereof or
incorporated or deemed to be incorporated by reference therein,
(ii) any
information contained or incorporated by reference in a prospectus
filed with
the Commission pursuant to Rule 424(b) under the Act and deemed,
pursuant to
Rule 430A under the Act, to be part of the registration statement
at the
Effective Time, and (iii) any registration statement filed to
register the offer
and sale of Shares pursuant to Rule 462(b) under the Act.
Except where the context otherwise requires, "Prospectus," as
used
herein, means the prospectus, in the form filed by New ARI 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 under the
Act, in each
case in the form furnished by New ARI to you for use by the
Underwriters and by
dealers in connection with the offering of the Shares.
"Permitted Free Writing Prospectuses," as used herein, means
the
documents listed on Schedule B attached hereto "and each "road
show" (as defined
in Rule 433 under the Act), if any, related
<PAGE>
to the offering of the Shares contemplated hereby that is a
"written
communication" (as defined in Rule 405 under the Act) (each such
road show, a
"Road Show")".
"Disclosure Package," as used herein, means any Preliminary
Prospectus together with any combination of one or more of the
Permitted Free
Writing Prospectuses, if any.
For purposes of this Agreement, all references to the
Registration
Statement, any Preliminary Prospectus, the Prospectus or any
amendment or
supplement to any of the foregoing shall be deemed to include the
copy filed
with the Commission pursuant to its Electronic Data Gathering,
Analysis and
Retrieval system ("EDGAR"). As used herein, "business day" shall
mean a day on
which The Nasdaq National Market ("Nasdaq") is open for
trading.
New ARI has prepared and filed, in accordance with Section 12 of
the
Securities Exchange Act of 1934, as amended, and the rules and
regulations
thereunder (collectively, the "Exchange Act"), a registration
statement (as may
be amended prior to the time of execution of this Agreement, the
"Exchange Act
Registration Statement") on Form 8-A (File No. [____]) under the
Exchange Act to
register, under Section 12(g) of the Exchange Act, the class of
securities
consisting of the Common Stock.
New ARI 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, New ARI
agrees to issue and sell to the respective Underwriters and each of
the
Underwriters, severally and not jointly, agrees to purchase from
New ARI the
respective number of Firm Shares (subject to such adjustments you
may determine
to avoid fractional shares) which bears the same proportion to the
number of
Firm Shares to be sold by New ARI as such number of Firm Shares set
forth
opposite the name of such Underwriter in Schedule A attached
hereto, subject to
adjustment in accordance with Section 8 hereof, in each case at a
purchase price
of $[o] per Share.
New ARI 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, New ARI hereby grants 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 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 New ARI for the Firm Shares. This option may be exercised by UBS
Securities
LLC ("UBS") on behalf of the several Underwriters at any time and
from time to
time on or before the thirtieth day following the date hereof, upon
notice to
New ARI. 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), but it may be on the same day as the Time of Purchase, 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 by
New ARI to each Underwriter shall be the number which bears the
same proportion
to the aggregate number of Additional Shares being purchased from
New ARI at the
Additional Time of Purchase as the number of Additional Shares
set
<PAGE>
forth opposite the name of such Underwriter on Schedule A hereto
bears to the
total number of Additional Shares (subject, in each case, to such
adjustment as
you may determine to eliminate fractional shares), subject to
adjustment in
accordance with Section 8 hereof.
2. Payment and Delivery. Payment of the purchase price for the
Firm
Shares shall be made to, or as directed in writing by, New ARI 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 [o], 2006 (unless another time shall
be agreed to
by you and New ARI or unless postponed in accordance with the
provisions of
Section 8 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 to New ARI in the same
manner and at the
same office as the payment for the Firm Shares. 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 and in the same manner
as the Firm
Shares.
Deliveries of the documents described in Section 6 hereof with
respect to the purchase of the Shares shall be made at the offices
of Shearman &
Sterling LLP at 599 Lexington Avenue, New York, New York, 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 New ARI and Old ARI. New
ARI
and Old ARI represent and warrant to and agree with each of the
Underwriters
that:
(a) the Registration Statement, including any registration
statement
filed with
the Commission pursuant to Rule 462(b) under the Act and any
post-effective amendment thereto, has been declared effective under
the
Act; and
no stop order of the Commission preventing or suspending the
use
of any
Preliminary Prospectus or Permitted Free Writing Prospectus or
the
effectiveness of the Registration Statement is in effect and no
proceedings for such purpose have been instituted or, to New ARI's
or Old
ARI's
knowledge, are threatened or contemplated by the Commission and
any
request on
the part of the Commission for additional information has been
complied
with; the Exchange Act Registration Statement has become
effective
as provided in Section 12 of the Exchange Act; each Preliminary
Prospectus
(except for the preliminary prospectus included in the
Registration Statement filed with the Commission on October 5,
2005)
complied,
at the time it was filed with the Commission, and complies as
of
the date
hereof, in all material respects with the requirements of the
Act; at no
time during the period that begins on the earlier of the date
of such
Preliminary Prospectus and the date such Preliminary Prospectus
was filed
with the Commission and ends at the Time of Purchase and any
Additional
Time of Purchase did or will any Preliminary Prospectus, as
then
amended or supplemented, include an untrue statement of a
material
fact or
omit to state a material fact necessary in order to make the
statements
therein, in the light of the circumstances under which they
were made,
not misleading, and at no time during such period did or will
any
Preliminary Prospectus, as then amended or supplemented, together
with
any combination
of one or more of the then issued Permitted Free Writing
Prospectuses, if any, include an untrue statement of a material
fact or
omit to
state a material fact necessary in order to make the statements
therein,
in the light of the circumstances under which they were made,
not
misleading; the Registration Statement, including any
registration
statement
filed with the Commission pursuant to Rule 462(b) under the Act
and any
post-effective amendment thereto, complied when it became
effective,
complies as of the date
<PAGE>
hereof
and, as amended or supplemented, if applicable, will comply, at
the
Time of
Purchase and any Additional Time of Purchase and at all times
during
which a prospectus is required by the Act to be delivered
(whether
physically
or through compliance with Rule 172 under the Act or any
similar
rule) in connection with any sale of Shares, will comply, 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 conditions to the use of Form S-1 have been
satisfied;
the Registration Statement (other than with respect to matters
of fact
relating to parties other than Old ARI, New ARI or the
Subsidiaries contained in or referred to in the agreements filed
as
exhibits
thereto) did not, as of the Effective Time, 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; the Prospectus will comply as of its date, the date
that it is
filed with
the Commission, and at the Time of Purchase and any Additional
Time of
Purchase and at all times during which a prospectus is required
by
the Act to
be delivered (whether physically or through compliance with
Rule 172
under the Act or any similar rule) in connection with any sale
of
Shares, in
all material respects, with the requirements of the Act
(including, without limitation, Section 10(a) of the Act); at no
time
during the
period that begins on the earlier of the date of the Prospectus
and the
date the Prospectus is filed with the Commission and ends at
the
later of
the Time of Purchase, the latest Additional Time of Purchase,
if
any, and
the end of the period during which a prospectus is required by
the Act to
be delivered (whether physically or through compliance with
Rule 172
under the Act or any similar rule) in connection with any sale
of
Shares did
or will the Prospectus, as then amended or supplemented,
include an
untrue statement of a material fact or omit to state a material
fact necessary in
order to make the statements therein, in the light of
the
circumstances under which they were made, not misleading; at no
time
during the
period that begins on the date of such Permitted Free Writing
Prospectus
and ends at the Time of Purchase and any Additional Time of
Purchase
did or will any Permitted Free Writing Prospectus include an
untrue
statement of a material fact or omit to state a material fact
necessary
in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading;
provided,
however,
that New ARI or Old ARI makes no warranty or representation
with
respect to
any statement contained in any Preliminary Prospectus, the
Registration
Statement or the Prospectus or any Permitted Free Writing
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 Old ARI or New ARI expressly for use in
such
Preliminary Prospectus, the Registration Statement, the Prospectus
or such
Permitted
Free Writing Prospectus;
(b) prior to the execution of this Agreement, New ARI and Old
ARI
have not,
directly or indirectly, offered or sold any Shares by means of
any
"prospectus" (within the meaning of the Act) or used any
"prospectus"
(within
the meaning of the Act) in connection with the offer or sale of
the
Shares, in each case other than the Preliminary Prospectuses and
the
Permitted
Free Writing Prospectuses, if any; New ARI and Old ARI have
not,
directly
or indirectly, prepared, used or referred to any Permitted Free
Writing
Prospectus except in material compliance with Rules 164 and 433
under the
Act; assuming that such Permitted Free Writing Prospectus is
accompanied or preceded by the most recent Preliminary Prospectus
that
contains a
price range or the Prospectus, as the case may be, and that
such
Permitted Free Writing Prospectus is so sent or given after the
Registration Statement was filed with the Commission (and after
such
Permitted
Free Writing Prospectus was, if required pursuant to Rule
433(d)
under the
Act, filed with the Commission), the sending or giving, by any
Underwriter, of any Permitted Free Writing Prospectus will satisfy
the
provisions
of Rule 164 or Rule 433 (without reliance on subsections (b),
(c) and
(d) of Rule 164); the Preliminary Prospectus dated [o] is a
prospectus
<PAGE>
that,
other than by reason of Rule 433 or Rule 431 under the Act,
satisfies
the requirements of Section 10 of the Act, including a price
range
where required by rule; neither New ARI nor the Underwriters
are
disqualified, by reason of subsection (f) or (g) of Rule 164 under
the
Act, from
using, in connection with the offer and sale of the Shares,
"free
writing prospectuses" (as defined in Rule 405 under the Act)
pursuant
to Rules 164 and 433 under the Act; New ARI is not an
"ineligible
issuer"
(as defined in Rule 405 under the Act) as of the eligibility
determination date for purposes of Rules 164 and 433 under the Act
with
respect to
the offering of the Shares contemplated by the Registration
Statement;
the parties hereto agree and understand that the content of any
and all
"road shows" developed with the consent of Old ARI and New ARI
(as
defined in
Rule 433 under the Act) related to the offering of the Shares
contemplated hereby is solely the property of New ARI and Old ARI;
New ARI
and Old
ARI have caused there to be made available at least one version
of
a "bona
fide electronic road show" (as defined in Rule 433 under the
Act)
in a
manner that, pursuant to Rule 433(d)(8)(ii) under the Act, causes
New
ARI not to
be required, pursuant to Rule 433(d) under the Act, to file,
with the
Commission, any such Road Show;
(c) Old ARI has an authorized, issued and outstanding
capitalization
as set
forth under the heading "Actual" in the section of the
Registration
Statement,
the Preliminary Prospectus and the Prospectus entitled
"Capitalization" (and any similar sections or information, if
any,
contained
in any Permitted Free Writing Prospectus) and, as of the Time
of
Purchase
and the Additional Time of Purchase, as the case may be after
giving
effect to the Offering and the Concurrent Transactions, New ARI
shall have
an authorized and outstanding capitalization as set forth under
the
heading "As Adjusted" in the section of the Registration
Statement,
the
Preliminary Prospectus and the Prospectus (and any similar sections
or
information, if any,
contained in any Permitted Free Writing Prospectus)
entitled
"Capitalization" (subject, in each case, to the issuance of
shares of
Common Stock upon exercise of stock options disclosed as
outstanding in the Registration Statement, the Preliminary
Prospectus and
the
Prospectus and excluding the shares of Common Stock available
for
future
issuance under the equity compensation plan described in the
Registration Statement, the Preliminary Prospectus and the
Prospectus),
all of the
issued and outstanding capital stock of New ARI is owned by Old
ARI; Old
ARI has redeemed the single share of its mandatorily redeemable
preferred
stock, $0.01 par value per share prior to the consummation of
the
Merger; all of the issued and outstanding shares of capital stock
of
New ARI
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; and the
Shares are
duly listed, and admitted and authorized for trading subject to
official
notice of issuance and evidence of satisfactory distribution,
on
Nasdaq;
and on or prior to the Time of Purchase, New ARI has
consummated
the Merger
in the manner set forth in the Registration Statement, the
Preliminary Prospectus and the Prospectus; and the Certificate of
Merger
of New ARI
and the bylaws of New ARI, each in the form filed as an exhibit
to the
Registration Statement, have been heretofore duly authorized
and
approved
in accordance with the Delaware General Corporation Law and
shall
become
effective and in full force and effect on or before the Time of
Purchase;
(d) New ARI and Old ARI have been duly incorporated and are
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, the Preliminary
<PAGE>
Prospectus, the Prospectus and any Permitted Free Writing
Prospectus to
execute
and deliver this Agreement and to issue, sell and deliver the
Shares as
contemplated herein and to perform its other obligations under
this
Agreement and to consummate the transactions contemplated in
the
Registration Statement, the Preliminary Prospectus, the Prospectus
and any
Permitted
Free Writing Prospectus (including without limitation, the
Concurrent
Transactions);
(e) New ARI and Old ARI are duly qualified to do business as a
foreign
corporation and are 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
or in good
standing would not, individually or in the aggregate, have a
material
adverse effect on the business, properties, condition
(financial,
or
otherwise), or results of operations or prospects of New ARI, Old
ARI
and the
Subsidiaries (as hereinafter defined) taken as a whole (a
"Material
Adverse Effect");
(f) As of the date hereof, New ARI has no subsidiaries, and Old
ARI
has no
subsidiaries either direct or indirect, other than the
subsidiaries
listed in
Schedule C (each a "Subsidiary" and collectively, the
"Subsidiaries"); other than the capital stock of the Subsidiaries,
Old ARI
does not,
and following the Merger New ARI will 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
each of
Old ARI and New ARI and the Subsidiaries and all amendments
thereto
have been made available 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 that is a
"significant subsidiary," as that term is defined in Rule 1-02(w)
of
Regulation
S-X under the Act (each such Subsidiary, a "Material
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, the Preliminary Prospectus, the Prospectus
and any
Permitted
Free Writing Prospectus; each Material 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; each Subsidiary is
in
compliance
in all respects with the laws, orders, rules, regulations and
directives
issued or administered by such jurisdictions, except where the
failure to
be in compliance 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 including New ARI, have been duly
authorized
and validly issued, are fully paid and non-assessable, have
been
issued in compliance with all applicable securities laws, were
not
issued in
violation of any preemptive right, resale right, right of first
refusal or
similar right and are owned prior to the Merger by Old ARI and
following
the Merger by New ARI and are not subject to any security
interest,
other encumbrance or adverse claims that would not,
individually
or in the
aggregate, have a Material Adverse Effect; and 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;
(g) 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 and the issuance of the Shares is
not
subject to
preemptive or other similar rights;
<PAGE>
(h) the capital stock of New ARI, including the Shares, and of
Old
ARI
conforms in all material respects to the description thereof
contained
in the
Registration Statement, the Preliminary Prospectus, the
Prospectus
and any
Permitted Free Writing Prospectus as described in the section
"Description of Capital Stock" and the form of specimen certificate
for
the Shares
complies with applicable law and the holders of the Shares will
not be
subject to personal liability by reason of being such holders;
(i) this
Agreement has been duly authorized, executed and
delivered
by New ARI and Old ARI;
(j) none of New ARI, Old ARI or 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 or violation
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 (other than the redemption of one share
of
mandatory
redeemable preferred stock, $0.01 par value, of Old ARI held by
Carl C.
Icahn) or repayment of all or a part of such indebtedness
under)
(i) its
respective charter or by-laws, or (ii) 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 New ARI, Old ARI 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 (iii) any federal, state, local or foreign law,
regulation
or rule
applicable to Old ARI, New ARI or the Subsidiaries, or (iv) any
rule or
regulation of Nasdaq applicable to New ARI, Old ARI or the
Subsidiaries, or (v) any decree, judgment or order applicable to
New ARI,
Old ARI or
any of the Subsidiaries or any of their respective properties,
except in
the case of the foregoing clauses (ii), (iii), (iv) and (v),
for
any
breach, violation or default, as applicable, that would not,
individually or in the aggregate have a Material Adverse Effect;
and the
execution,
delivery and performance of this Agreement, the issuance and
sale of
the Shares and the consummation of the transactions
contemplated
hereby and
contemplated in the Registration Statement, the Preliminary
Prospectus, the Prospectus and any Permitted Free Writing
Prospectus
(including, without limitation, the Concurrent Transactions) 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 or violation 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) (or result in the
creation or
imposition of a lien, charge or encumbrance on any property or
assets of
the Company or any Subsidiary pursuant to) (1) the charter or
by-laws of
New ARI, Old ARI or any of the Subsidiaries, or (2) any
indenture,
mortgage, deed of trust, bank loan or credit agreement or other
evidence
of indebtedness any license, lease, contract or other agreement
or
instrument to which New ARI, Old ARI 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 (3) any federal, state, local or foreign law,
regulation
or rule applicable to New ARI, Old ARI or the Subsidiaries, or
(4) any
decree, judgment or order applicable to New ARI, Old ARI or any
of
the
Subsidiaries, or (5) any rule or regulation of Nasdaq, except in
the
case of
the foregoing clauses (2), (4) and (5), for any breach,
violation
or
default, as applicable, that would not, individually or in the
aggregate
have a Material Adverse Effect;
(k) no approval, authorization, consent, qualification, decree
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 by New ARI or the
consummation by New ARI or Old ARI of the Concurrent
Transactions
contemplated hereby and as contemplated in the Registration
Statement, the
Preliminary
Prospectus, the
<PAGE>
Prospectus
and any Permitted Free Writing Prospectus (including, without
limitation, the Concurrent Transactions) except for (i)
registration of
the Shares
under the Act, which has been or will be effected, (ii) any
necessary
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, (iii)
any
necessary
notice to the Pension Benefit Guarantee Corporation as
described
in the
Prospectus and (iv) and the filing by Old ARI of financing
statements
under the Uniform Commercial Code as in effect in the State of
New York
(the "UCC") in connection with the discharge of any liens
pursuant
to the repayment of the Credit Facility;
(l) except as set forth in the Registration Statement, the
Preliminary Prospectus, the Prospectus and any Permitted Free
Writing
Prospectus, (i) no person has the right, contractual or otherwise,
to
cause New
ARI or Old ARI to issue or sell to it any shares of Common
Stock
or shares
of any other capital stock or other equity interests of New ARI
or Old
ARI, as the case may be, (ii) no person has any preemptive
rights,
resale
rights, rights of first refusal or other rights to purchase (A)
from New
ARI or Old ARI any shares of Common Stock or shares of any
other
capital
stock or other equity interests of New ARI or Old ARI and (B)
to
the
knowledge of New ARI or Old ARI any shares of Common Stock or
shares
of any
other capital stock or other equity interests of New ARI or Old
ARI, and
(iii) no person has the right to act as an underwriter or as a
financial
advisor to New ARI or Old ARI in connection with the offer and
sale of
the Shares, and (iv) no person has the right, contractual or
otherwise,
to cause New ARI or Old ARI to register under the Act any
shares of
Common Stock or shares of any other capital stock or other
equity
interests of New ARI or Old ARI, or to include any such shares
or
interests
in the Registration Statement or the offering contemplated
thereby,
in the case of each of the foregoing clauses (i), (ii), (iii)
and
(iv)
whether as a result of the filing or effectiveness of the
Registration Statement or the sale of the Shares as contemplated
thereby
or
otherwise;
(m) each of New ARI, Old ARI 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 such failure to possess any such license,
authorization, consent or approval or make any such filings would
not,
individually or in the aggregate have a Material Adverse Effect;
none of
New ARI,
Old ARI or 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 New ARI, Old ARI 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;
(n) there are no actions, suits, claims, investigations or
proceedings pending or to the knowledge of New ARI and Old ARI
threatened
or
contemplated, to which New ARI, Old ARI or any of the Subsidiaries
or,
to the
knowledge of New ARI and Old ARI, any of their respective
directors
or
officers in their capacities as such directors and officers, is
or
would be a
party or of which any of their respective properties is or
would be
subject at law or in equity, before or by any federal, state,
local or
foreign governmental or regulatory commission, board, body,
court
authority
or 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 (including
without
limitation, the Concurrent Transactions) or as otherwise disclosed
in the
Registration Statement the Preliminary Prospectus and the
Prospectus;
<PAGE>
(o) each of Grant Thornton LLP and KPMG LLP, whose reports on
the
consolidated financial statements of Old ARI and the Subsidiaries
are
filed with
the Commission as part of the Registration Statement, the
Preliminary Prospectus and the Prospectus, is an independent
registered
public
accounting firm as required by the Act and by the rules of the
Public
Company Accounting Oversight Board;
(p) the consolidated financial statements included in the
Registration Statement, the Preliminary Prospectus, the Prospectus
or any
Permitted
Free Writing Prospectus, together with the related notes and
schedules,
present fairly in all material respects the consolidated
financial
position of Old ARI and the Subsidiaries as of the dates
indicated
and the consolidated results of operations and cash flows of
Old
ARI and
the Subsidiaries for the periods specified and have been
prepared
in
compliance with the requirements of the Act in all material
respects
and in
conformity with generally accepted accounting principles applied
on
a
consistent basis during the periods involved subject to, in the
case of
the
financial statements for the nine months ended September 30, 2004
and
2005, only
normal, recurring adjustments; the other financial data set
forth in
the Registration Statement, the Preliminary Prospectus, the
Prospectus
or any Permitted Free Writing Prospectus is fairly presented
and
prepared in all material respects on a basis consistent with
the
financial
statements of Old ARI included in the Registration Statement,
the
Preliminary Prospectus, the Prospectus or any Permitted Free
Writing
Prospectus; there are no financial statements (historical or pro
forma)
that are
required to be included in the Registration Statement, the
Preliminary Prospectus, the Prospectus or any Permitted Free
Writing
Prospectus
that are not included as required, including financial
statements
of New ARI;
(q) subsequent to the time of execution of this Agreement or,
if
earlier,
the respective dates as of which information is given in the
Registration Statement, the Preliminary Prospectus, the Prospectus
or any
Permitted
Free Writing 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 New ARI, Old ARI and the
Subsidiaries taken as a whole, (ii) any obligation, direct or
contingent
(including
any off-balance sheet obligations), incurred by New ARI, Old
ARI or the
Subsidiaries, which is material to New ARI, Old ARI and the
Subsidiaries taken as a whole except as contemplated in the
Registration
Statement,
the Preliminary Prospectus, the Prospectus or any Permitted
Free
Writing Prospectus, (iii) any change in the capital stock or
material
changes in
outstanding indebtedness of New ARI, Old ARI or the
Subsidiaries except as contemplated in the Registration Statement,
the
Preliminary Prospectus, the Prospectus or any Permitted Free
Writing
Prospectus
or (iv) any dividend or distribution of any kind declared, paid
or made on
the capital stock of New ARI, Old ARI except as contemplated in
the
Registration Statement, the Preliminary Prospectus, the Prospectus
or
any
Permitted Free Writing Prospectus;
(r) New ARI and Old ARI have obtained for the benefit of the
Underwriters the agreement (a "Lock-Up Agreement"), substantially
in the
form set
forth as Exhibit A hereto, of each entity or individual listed
in
Schedule
D;
(s) none of New ARI, Old ARI, or any Subsidiary is 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"); and, after giving effect to the offering
and
sale of
the Shares and at no time during which a prospectus is required
by
the Act to
be delivered (whether physically or through compliance with
Rule 172
under the Act or any similar rule) in connection with any sale
of
Shares,
none of New ARI, Old ARI, or any Subsidiary will be an
investment
company or
an entity controlled by an investment company; and upon the
application of the proceeds from the sale of the Shares in the
manner
contemplated by
<PAGE>
the
Registration Statement, the Preliminary Prospectus, the Prospectus
or
any
Permitted Free Writing Prospectus as described in the section "Use
of
Proceeds,"
none of New ARI, Old ARI, or any Subsidiary will be an
investment
company or an entity controlled by an investment company;
(t) except as disclosed in the Registration Statement, the
Preliminary Prospectus, the Prospectus or any Permitted Free
Writing
Prospectus, New ARI, Old ARI and each of the Subsidiaries has good
and
marketable
title to all property (real and personal) described in the
Registration Statement, the Preliminary Prospectus, the Prospectus
or any
Permitted
Free Writing Prospectus as being owned by each of them, free
and
clear of
all liens, claims, security interests or other encumbrances,
except
where the failure to possess good and marketable title would
not,
individually or in the aggregate have a Material Adverse Effect;
all the
property
described in the Registration Statement, the Preliminary
Prospectus, the Prospectus or any Permitted Free Writing Prospectus
as
being held
under lease by New ARI, Old ARI or a Subsidiary is held thereby
under
valid, subsisting and enforceable leases, assuming the due and
valid
execution
by the lessors thereto, except where the failure to have valid,
subsisting
and enforceable leases would not, individually or in the
aggregate
have a Material Adverse Effect;
(u) Old ARI and the Subsidiaries own and following the Merger
New
ARI and
the Subsidiaries will 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,
service
names, copyrights, trade secrets and other proprietary
information
described
in the Registration Statement, the Preliminary Prospectus, the
Prospectus
or any Permitted Free Writing Prospectus (collectively,
"Intellectual Property") 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; (i) to the knowledge of
New
ARI and
Old ARI, there are no third parties who have, or 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
New
ARI; (ii)
to New ARI's knowledge, there is no infringement by third
parties of
any Intellectual Property; (iii) there is no pending or, to New
ARI's
knowledge, threatened action, suit, proceeding or claim by
others
challenging New ARI's rights in or to any Intellectual Property;
(iv)
there is
no pending or, to New ARI's knowledge, threatened action, suit,
proceeding
or claim by others challenging the validity or scope of any
Intellectual Property, and to New ARI's knowledge, there are no
facts
which
could form a reasonable basis for any such claim; and (v) there
is
no pending
or, to New ARI's knowledge, threatened action, suit, proceeding
or claim
by others that New ARI infringes or otherwise violates any
patent,
trademark, copyright, trade name, service name, trade secret or
other
proprietary rights of others, and to New ARI's knowledge there
are
no facts
which could form a reasonable basis for any such action, suit
proceeding
or claim;
(v) 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 knowledge of New ARI and
Old
ARI,
threatened against New ARI, Old ARI 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, to
the knowledge of New ARI and Old ARI, threatened, (B) no
strike,
labor dispute, slowdown or stoppage pending or, to the
knowledge
of New ARI
or Old ARI, threatened against New ARI, Old ARI or any of the
Subsidiaries and (C) no union representation dispute currently
existing
concerning
the employees of New ARI, Old ARI or any of the Subsidiaries,
and (ii)
to the knowledge of New ARI and Old ARI, (A) no union
organizing
activities
are currently taking place concerning the employees of the New
ARI, Old
ARI or any of the Subsidiaries and (B) there has been no
violation
of any federal, state, local or foreign law relating to
discrimination
<PAGE>
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 New ARI, Old ARI or any of the
Subsidiaries, except where such violation would not, individually
or in
the
aggregate, have a Material Adverse Effect;
(w) New ARI, Old ARI 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; except as would not,
individually or in the aggregate, have a Material Adverse Effect,
there
are no
past, present or, to the knowledge of New ARI and Old ARI,
reasonably
anticipated future events, conditions, circumstances,
activities, practices, actions, omissions or plans that could
reasonably
be
expected to give rise to any costs or liabilities to New ARI, Old
ARI
or the
Subsidiaries under, or to interfere with or prevent compliance
by
New ARI or
the Subsidiaries with, Environmental Laws; except as would not,
individually or in the aggregate, have a Material Adverse Effect,
none of
New ARI,
Old ARI or any of the Subsidiaries (i) to the knowledge of New
ARI and
Old ARI, is the subject of any investigation, (ii) has received
any
written notice or claim, (iii) is a party to or affected by any
pending,
or to the knowledge of New ARI and Old ARI, 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
material
violation of any Environmental Law or any actual or alleged
release or
threatened material 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);
(x) all material tax returns required to be filed by New ARI,
Old
ARI and
each of the Subsidiaries have been filed; 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 New ARI, Old ARI and each
of the
Subsidiaries have been paid, other than those that are
immaterial
in amount
or those being contested in good faith and for which adequate
reserves
have been provided;
(y) New ARI, Old ARI and each of the Subsidiaries maintains
insurance
covering its properties, operations, personnel and businesses
as
New ARI
and Old ARI deems adequate to protect New ARI, Old ARI and the
Subsidiaries and their businesses; all such insurance is fully in
force on
the date
hereof except where the failure to maintain such insurance
would
not
individually or the aggregate have a Material Adverse Effect;
(z) none of New ARI, Old ARI or any of the Subsidiaries has
sustained
since the date of the last audited financial statements
included
in the
Registration Statement, the Preliminary Prospectus 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
<PAGE>
labor
dispute or court or governmental action, order or decree, except
for
any loss
or interference which would not, individually or in the
aggregate,
have a Material Adverse Effect;
(aa) none of New ARI, Old ARI or any Subsidiary has sent or
received
any
communication regarding termination of, or intent not to renew, any
of
the
contracts or agreements referred to or described in any
Preliminary
Prospectus, the Prospectus or any Permitted Free Writing
Prospectus, or
referred
to or described in, or filed as an exhibit to, the Registration
Statement
except where such termination or nonrenewal would not
individually or in the aggregate have a Material Adverse Effect,
and no
such
termination or non-renewal has been threatened by the Company or,
to
the
Company's knowledge, by any other party to any such contract or
agreement
except where such termination or nonrenewal would not
individually or in the aggregate have a Material Adverse Effect; as
a
result of
the Merger, neither New ARI, Old ARI nor any Subsidiary expect
to receive
any such communication relating to the termination or
non-renewal of such contracts except where such termination or
nonrenewal
would not
individually or in the aggregate have a Material Adverse
Effect;
(bb) New ARI, Old ARI and each of the Subsidiaries maintains a
system of
internal accounting controls sufficient to provide reasonable
