Document:

exv10wxay

 

Exhibit 10(a)

THIRD 2007 AMENDMENT TO

LA-Z-BOY INCORPORATED

2004 LONG-TERM EQUITY AWARD PLAN

LA-Z-BOY INCORPORATED, a Michigan corporation (the “Company”), adopts this amendment to its 2004
Long-Term Equity Award Plan, as previously amended (the “Plan”).

WHEREAS the Company believes it advisable and in the best interests of the Company to make certain
changes to the Plan; and

WHEREAS pursuant to Article X, Section 10.2 of the Plan, the Company reserved the right to amend
the Plan subject to the conditions provided therein;

NOW, THEREFORE, the Plan is hereby amended to delete Section 7.1(b) of Article VII and replace it
with the following:

	 	(b)	 	An Employee who is newly hired or newly promoted into a Senior Management
Employee or Key Management Employee position may, in the sole discretion of the
Company’s Chief Executive Officer, be awarded up to 50,000 shares of Restricted Stock;
provided, however, that all such grants to the Company’s Executive Officers (as
determined under the applicable rules of the Securities and Exchange Commission) must
be approved by the Administrator.

The above amendment shall be effective July 5, 2007.

The terms and provisions of the Plan shall in all other regards remain in full force and effect.

IN WITNESS WHEREOF, the Company has caused this document to be executed by its duly authorized
officer.

	 	 	 	 	 
	 	LA-Z-BOY INCORPORATED

 	 
	 	By  	 	 
	 	 	Itsexv10w1

 

Exhibit 10.1

EXECUTION COPY

 

 

ZOLTEK COMPANIES, INC.

(a Missouri corporation)

4,000,000 Shares of Common Stock

PURCHASE AGREEMENT

Dated: August 14, 2007

 

 

 

 

EXECUTION COPY

ZOLTEK COMPANIES, INC.

(a Missouri corporation)

4,000,000 Shares of Common Stock

(Par Value $0.01 Per Share)

PURCHASE AGREEMENT

August 14, 2007

MERRILL LYNCH & CO.

Merrill Lynch, Pierce, Fenner & Smith

          Incorporated

     as Representative of the several Underwriters

4 World Financial Center

New York, New York 10080

Ladies and Gentlemen:

     Zoltek Companies, Inc., a Missouri corporation (the “Company”), and the persons listed in
Schedule B hereto (the “Selling Shareholders”) confirm their respective agreements with Merrill
Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated (“Merrill Lynch”) and each of the
other Underwriters named in Schedule A hereto (collectively, the “Underwriters,” which term shall
also include any underwriter substituted as hereinafter provided in Section 10 hereof), for whom
Merrill Lynch is acting as representative (in such capacity, the “Representative”), with respect
to (i) the sale by the Company and the Selling Shareholders, acting severally and not jointly, and
the purchase by the Underwriters, acting severally and not jointly, of the respective numbers of
shares of Common Stock, par value $0.01 per share (“Common Stock”), of the Company set forth in
Schedules A and B hereto and (ii) the grant by the Company to the Underwriters, acting severally
and not jointly, of the option described in Section 2(b) hereof to purchase all or any part of
600,000 additional shares of Common Stock to cover overallotments, if any. The aforesaid 4,000,000
shares of Common Stock (the “Initial Securities”) to be purchased by the Underwriters and all or
any part of the 600,000 shares of Common Stock subject to the option described in Section 2(b)
hereof (the “Option Securities”) are hereinafter called, collectively, the “Securities.”

     The Company and the Selling Shareholders understand that the Underwriters propose to make a
public offering of the Securities as soon as the Representative deems advisable after this
Agreement has been executed and delivered.

     The Company has filed with the Securities and Exchange Commission (the “Commission”) a shelf
registration statement on Form S-3 (No. 333-143996), including the related preliminary prospectus
or prospectuses, covering the registration of the Securities under the Securities Act of 1933, as
amended (the “1933 Act”). Promptly after execution and delivery of this Agreement, the Company
will prepare and file a prospectus in accordance with the provisions of Rule 430B (“Rule 430B”) of
the rules and regulations of the Commission under the 1933 Act (the “1933 Act Regulations”) and
paragraph (b) of Rule 424 (“Rule 424(b)”) of the 1933 Act Regulations. Any information included in
such prospectus that was omitted from such registration statement at the time it became effective
but that is deemed to be part of and included in such registration statement pursuant to Rule 430B
is referred to as “Rule 430B Information.” Each

 

 

prospectus used in connection with the offering of the Securities that omitted Rule 430B
Information is herein called a “preliminary prospectus.” Such registration statement, at any given
time, including the amendments thereto to such time, the exhibits and any schedules thereto at such
time, the documents incorporated by reference therein pursuant to Item 12 of Form S-3 under the
1933 Act at such time and the documents otherwise deemed to be a part thereof or included therein
by 1933 Act Regulations, is herein called the “Registration Statement.” The Registration Statement
at the time it originally became effective is herein called the “Original Registration Statement.”
The final prospectus in the form first furnished to the Underwriters for use in connection with the
offering of the Securities, together with the documents incorporated by reference therein pursuant
to Item 12 of Form S-3 under the 1933 Act at the time of the execution of this Agreement and any
preliminary prospectuses that form a part thereof, are herein collectively called the “Prospectus.”
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”).

     All references in this Agreement to financial statements and schedules and other information
which is “contained,” “included” or “stated” in the Registration Statement, any preliminary
prospectus or the Prospectus (or other references of like import) shall be deemed to mean and
include all such financial statements and schedules and other information which is incorporated by
reference in or otherwise deemed by 1933 Act Regulations to be a part of or included in the
Registration Statement, any preliminary prospectus or the Prospectus, as the case may be; and all
references in this Agreement to amendments or supplements to the Registration Statement, any
preliminary prospectus or the Prospectus shall be deemed to mean and include the filing of any
document under the Securities Exchange Act of 1934, as amended (the “1934 Act”), which is
incorporated by reference in or otherwise deemed by 1933 Act Regulations to be a part of or
included in the Registration Statement, such preliminary prospectus or the Prospectus, as the case
may be.

     SECTION 1. Representations and Warranties.

     (a) Representations and Warranties by the Company. The Company represents and warrants to
each Underwriter as of the date hereof, as of the Applicable Time referred to in Section 1(a)(ii)
hereof, as of the Closing Time referred to in Section 2(c) hereof, and as of each Date of Delivery
(if any) referred to in Section 2(b) hereof, and agrees with each Underwriter, as follows:

     (i) Registration Requirements. At the time of filing the Original Registration
Statement and at the date hereof, the Company met and meets the requirements for use of Form
S-3 under the 1933 Act.

     (ii) Registration Statement, Prospectus and Disclosure at Time of Sale. The
Original Registration Statement became effective on August 8, 2007, and any post-effective
amendment thereto has become effective. No stop order suspending the effectiveness of the
Registration Statement has been issued under the 1933 Act and no proceedings for that
purpose have been instituted or are pending or, to the knowledge of the Company, are
contemplated by the Commission, and any request on the part of the Commission for additional
information has been complied with.

     Any offer that is a written communication relating to the Securities made prior to the
filing of the Original Registration Statement by the Company or any person acting on its
behalf (within the meaning, for this paragraph only, of Rule 163(c) of the 1933 Act
Regulations) has been filed with the Commission in accordance with the exemption provided by
Rule 163 of the 1933 Act Regulations (“Rule 163”) and otherwise complied with the
requirements of Rule 163, including

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without limitation the legending requirement, to qualify such offer for the exemption
from Section 5(c) of the 1933 Act provided by Rule 163.

     At the respective times the Original Registration Statement and each amendment thereto
became effective, at each deemed effective date with respect to the Underwriters pursuant to
Rule 430B(f)(2) of the 1933 Act Regulations and at the Closing Time (and, if any Option
Securities are purchased, at the Date of Delivery), the Registration Statement complied and
will comply in all material respects with the requirements of the 1933 Act and the 1933 Act
Regulations and did not and will not contain an untrue statement of a material fact or omit
to state a material fact required to be stated therein or necessary to make the statements
therein not misleading.

     Neither the Prospectus nor any amendments or supplements thereto, at the time the
Prospectus or any such amendment or supplement was issued and at the Closing Time (and, if
any Option Securities are purchased, at the Date of Delivery), included or will include an
untrue statement of a material fact or omitted or will omit to state a material fact
necessary in order to make the statements therein, in the light of the circumstances under
which they were made, not misleading.

     Each preliminary prospectus (including the prospectus or prospectuses filed as part of
the Original Registration Statement or any amendment thereto) complied when so filed in all
material respects with the 1933 Act Regulations and each preliminary prospectus and the
Prospectus delivered to the Underwriters for use in connection with this offering was
identical to the electronically transmitted copies thereof filed with the Commission
pursuant to EDGAR, except to the extent permitted by Regulation S-T.

     As of the Applicable Time, neither (x) the Issuer General Use Free Writing
Prospectus(es) (as defined below) issued at or prior to the Applicable Time, the Statutory
Prospectus (as defined below) and the information included on Schedule C hereto, all
considered together (collectively, the “General Disclosure Package”), nor (y) any individual
Issuer Limited Use Free Writing Prospectus (as defined below), when considered together with
the General Disclosure Package, included any untrue statement of a material fact or omitted
to state any material fact necessary in order to make the statements therein, in the light
of the circumstances under which they were made, not misleading.

     As used in this subsection and elsewhere in this Agreement:

     “Applicable Time” means 8:00 p.m. (Eastern time) on August 14, 2007 or such other time
as agreed by the Company and Merrill Lynch.

     “Issuer Free Writing Prospectus” means any “issuer free writing prospectus,” as defined
in Rule 433 of the 1933 Act Regulations (“Rule 433”), relating to the Securities that (i) is
required to be filed with the Commission by the Company, (ii) is a “road show that is a
written communication” within the meaning of Rule 433(d)(8)(i), whether or not required to
be filed with the Commission, or (iii) is exempt from filing pursuant to Rule 433(d)(5)(i)
because it contains a description of the Securities or of the offering that does not reflect
the final terms, in each case in the form filed or required to be filed with the Commission
or, if not required to be filed, in the form retained in the Company’s records pursuant to
Rule 433(g).

     “Issuer General Use Free Writing Prospectus” means any Issuer Free Writing Prospectus
that is intended for general distribution to prospective investors (other than a Bona Fide
Electronic Road Show (as defined below)), as evidenced by its being specified in Schedule E
hereto.

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     “Issuer Limited Use Free Writing Prospectus” means any Issuer Free Writing Prospectus
that is not an Issuer General Use Free Writing Prospectus.

     “Statutory Prospectus” as of any time means the prospectus relating to the Securities
that is included in the Registration Statement immediately prior to that time, including any
document incorporated by reference therein and any preliminary or other prospectus deemed to
be a part thereof.

     The Company has made available a “bona fide electronic road show,” as defined in Rule
433, in compliance with Rule 433(d)(8)(ii) (the “Bona Fide Electronic Road Show”) such that
no filing of any “road show” (as defined in Rule 433(h)) is required in connection with the
offering of the Securities.

     Each Issuer Free Writing Prospectus, as of its issue date and at all subsequent times
through the completion of the public offer and sale of the Securities or until any earlier
date that the issuer notified or notifies Merrill Lynch as described in Section 3(e), did
not, does not and will not include any information that conflicted, conflicts or will
conflict with the information contained in the Registration Statement or the Prospectus,
including any document incorporated by reference therein and any preliminary or other
prospectus deemed to be a part thereof that has not been superseded or modified.

     The representations and warranties in this subsection shall not apply to statements in
or omissions from the Registration Statement, the Prospectus or any Issuer Free Writing
Prospectus made in reliance upon and in conformity with written information furnished to the
Company by any Underwriter through Merrill Lynch expressly for use therein.

     (iii) Incorporated Documents. The documents incorporated or deemed to be
incorporated by reference in the Registration Statement and the Prospectus (the
“Incorporated Documents”) that have been filed on or before the date hereof were timely
filed with the Commission, except to the extent that late filings have been waived by the
Commission. The Incorporated Documents, at the time they were or hereafter are filed with
the Commission, complied and will comply in all material respects with the requirements of
the 1934 Act and the rules and regulations of the Commission thereunder (the “1934 Act
Regulations”), and, when read together with the other information in the Prospectus, (a) at
the time the Original Registration Statement became effective, (b) at the earlier of the
time the Prospectus was first used and the date and time of the first contract of sale of
Securities in this offering and (c) at the Closing Time (and, if any Option Securities are
purchased, at the Date of Delivery), did not and will not contain an untrue statement of a
material fact or omit to state a material fact required to be stated therein or necessary to
make the statements therein not misleading.

     (iv) Independent Accountants. To the knowledge of the Company, the accountants
who certified the financial statements and supporting schedules included in the Registration
Statement are independent public accountants as required by the 1933 Act and the 1933 Act
Regulations.

     (v) Financial Statements. The financial statements included in the
Registration Statement, the General Disclosure Package and the Prospectus, together with the
related financial statement schedules and notes, present fairly the financial position of
the Company and its consolidated subsidiaries at the dates indicated and the statements of
operations, stockholders’ equity and cash flows of the Company and its consolidated
subsidiaries for the periods specified; said financial statements have been prepared in
conformity with generally accepted accounting principles (“GAAP”) applied on a consistent
basis throughout the periods involved. The supporting

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schedules, if any, present fairly in accordance with GAAP the information required to
be stated therein. The selected financial data and the summary financial information
included in the General Disclosure Package and the Prospectus present fairly the information
shown therein and have been compiled on a basis consistent with that of the audited
financial statements included in the Registration Statement. The pro forma financial
statements and the related notes thereto, if any, included in the Registration Statement,
the General Disclosure Package and the Prospectus present fairly the information shown
therein, have been prepared in accordance with the Commission’s rules and guidelines with
respect to pro forma financial statements and have been properly compiled on the bases
described therein, and the assumptions used in the preparation thereof are reasonable and
the adjustments used therein are appropriate to give effect to the transactions and
circumstances referred to therein.  All disclosures contained in the Registration
Statement, the General Disclosure Package or the Prospectus regarding “non-GAAP financial
measures” (as such term is defined by the rules and regulations of the Commission) comply
with Regulation G under the 1934 Act and Item 10 of Regulation S-K of the 1933 Act
Regulations, to the extent applicable.

     (vi) No Material Adverse Change in Business. Since the respective dates as of
which information is given in the Registration Statement, the General Disclosure Package or
the Prospectus, except as otherwise stated therein, (A) there has been no material adverse
change in the condition, financial or otherwise, or in the earnings, business affairs or
business prospects of the Company and its subsidiaries considered as one enterprise, whether
or not arising in the ordinary course of business (a “Material Adverse Effect”), (B) there
has been no material loss or interference with the Company’s 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, nor has there been any change in the capital
stock of the Company, (C) there have been no transactions entered into by the Company or any
of its subsidiaries, other than those in the ordinary course of business, which are material
with respect to the Company and its subsidiaries considered as one enterprise, and (D) there
has been no dividend or distribution of any kind declared, paid or made by the Company on
any class of its capital stock.

     (vii) Good Standing of the Company. The Company has been duly organized and is
validly existing as a corporation in good standing under the laws of the State of Missouri
and has corporate power and authority to own, lease and operate its properties and to
conduct its business as described in the General Disclosure Package and the Prospectus and
to enter into and perform its obligations under this Agreement; and the Company is duly
qualified as a foreign corporation to transact business and is in good standing in each
other jurisdiction in which such qualification is required, whether by reason of the
ownership or leasing of property or the conduct of business, except where the failure so to
qualify or to be in good standing would not result in a Material Adverse Effect. 

     (viii) Good Standing of Subsidiaries. Each “significant subsidiary” of the
Company (as such term is defined in Rule 1-02 of Regulation S-X) and each of Zoltek
Properties, Inc. and Engineering Technology Corporation (each a “Subsidiary” and,
collectively, the “Subsidiaries”) has been duly organized and is validly existing in good
standing under the laws of the jurisdiction of its organization, has organizational power
and authority to own, lease and operate its properties and to conduct its business as
described in the General Disclosure Package and the Prospectus and is duly qualified to
transact business and is in good standing in each jurisdiction in which such qualification
is required, whether by reason of the ownership or leasing of property or the conduct of
business, except where the failure so to qualify or to be in good standing would not result
in a Material Adverse Effect; except as otherwise disclosed in the Registration Statement,
all of the issued and outstanding capital stock of each such Subsidiary has been duly
authorized and validly issued, is fully paid and non-assessable and is owned by the Company,
directly or through

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subsidiaries, free and clear of any security interest, mortgage, pledge, lien,
encumbrance, claim or equity; none of the outstanding shares of capital stock of any
Subsidiary was issued in violation of the preemptive or similar rights of any security
holder of such Subsidiary. The only subsidiaries of the Company are the subsidiaries listed
on Schedule F hereto.

     (ix) Capitalization. The shares of issued and outstanding capital stock,
including the Securities to be purchased by the Underwriters from the Selling Shareholders,
have been duly authorized and validly issued and are fully paid and non-assessable; none of
the outstanding shares of capital stock, including the Securities to be purchased by the
Underwriters from the Selling Shareholders, was issued in violation of the preemptive or
other similar rights of any security holder of the Company.

     (x) Authorization of Agreement. This Agreement has been duly authorized,
executed and delivered by the Company.

     (xi) Authorization and Description of Securities. The Securities to be
purchased by the Underwriters from the Company have been duly authorized for issuance and
sale to the Underwriters pursuant to this Agreement and, when issued and delivered by the
Company pursuant to this Agreement against payment of the consideration set forth herein,
will be validly issued and fully paid and non-assessable; the Common Stock conforms to all
statements relating thereto contained in the General Disclosure Package and the Prospectus;
the description of the Common Stock contained in the Prospectus conforms to the instruments
defining the rights of holders of the Common Stock; no holder of the Securities will be
subject to personal liability by reason of being such a holder; and the issuance of the
Securities is not subject to the preemptive or other similar rights of any security holder
of the Company.

     (xii) Absence of Defaults and Conflicts. Neither the Company nor any of its
subsidiaries is in violation of its charter or by-laws or in default in the performance or
observance of any obligation, agreement, covenant or condition contained in any contract,
indenture, mortgage, deed of trust, loan or credit agreement, note, lease or other agreement
or instrument to which the Company or any of its subsidiaries is a party or by which it or
any of them may be bound, or to which any of the property or assets of the Company or any
subsidiary is subject (collectively, “Agreements and Instruments”) except for such
violations or defaults that would not result in a Material Adverse Effect; and the
execution, delivery and performance of this Agreement and the consummation of the
transactions contemplated herein and in the Registration Statement (including the issuance
and sale of the Securities and the use of the proceeds from the sale of the Securities as
described in the General Disclosure Package and the Prospectus under the caption “Use of
Proceeds”) and compliance by the Company with its obligations hereunder have been duly
authorized by all necessary corporate action and do not and will not, whether with or
without the giving of notice or passage of time or both, conflict with or constitute a
breach of, or default or Repayment Event (as defined below) under, or result in the creation
or imposition of any lien, charge or encumbrance upon any property or assets of the Company
or any subsidiary pursuant to, the Agreements and Instruments (except for such conflicts,
breaches, defaults or Repayment Events or liens, charges or encumbrances that would not
result in a Material Adverse Effect), nor will such action result in any violation of the
provisions of the charter or by-laws of the Company or any subsidiary or any applicable law,
statute, rule, regulation, judgment, order, writ or decree of any government, government
instrumentality or court, domestic or foreign, having jurisdiction over the Company or any
subsidiary or any of their assets, properties or operations. As used herein, a “Repayment
Event” means any event or condition which gives the holder of any note, debenture or other
evidence of indebtedness (or any person acting on such holder’s behalf) the right to require

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the repurchase, redemption or repayment of all or a portion of such indebtedness by the
Company or any subsidiary.

     (xiii) Absence of Labor Dispute. No labor dispute with the employees of the
Company or any subsidiary exists or, to the knowledge of the Company, is imminent, and the
Company is not aware of any existing or imminent labor disturbance by the employees of any
of its or any subsidiary’s principal suppliers, manufacturers, customers or contractors,
which, in either case, would result in a Material Adverse Effect. 

     (xiv) Absence of Proceedings. There is no action, suit, proceeding, inquiry or
investigation before or brought by any court or governmental agency or body, domestic or
foreign, now pending, or, to the knowledge of the Company, threatened, against or affecting
the Company or any subsidiary, which is required to be disclosed in the Registration
Statement, the General Disclosure Package or the Prospectus (other than as disclosed
therein), or which might reasonably be expected to result in a Material Adverse Effect, or
which might reasonably be expected to materially and adversely affect the properties or
assets thereof or the consummation of the transactions contemplated in this Agreement or the
performance by the Company of its obligations hereunder; the aggregate of all pending legal
or governmental proceedings to which the Company or any subsidiary is a party or of which
any of their respective property or assets is the subject which are not described in the
Registration Statement, including ordinary routine litigation incidental to the business,
could not reasonably be expected to result in a Material Adverse Effect.

     (xv) Accuracy of Exhibits. There are no contracts or documents which are
required to be described in the Registration Statement, the General Disclosure Package, the
Prospectus or the documents incorporated by reference therein or to be filed as exhibits
thereto which have not been so described and filed as required.

     (xvi) Possession of Intellectual Property. The Company and its subsidiaries
own or possess, or can acquire on reasonable terms, adequate patents, patent rights,
licenses, inventions, copyrights, know-how (including trade secrets and other unpatented
and/or unpatentable proprietary or confidential information, systems or procedures),
trademarks, service marks, trade names or other intellectual property (collectively,
“Intellectual Property”) necessary to carry on the business now operated by them, and
neither the Company nor any of its subsidiaries has received any notice or is otherwise
aware of any infringement of or conflict with asserted rights of others with respect to any
Intellectual Property or of any facts or circumstances which would render any Intellectual
Property invalid or inadequate to protect the interest of the Company or any of its
subsidiaries therein, and which infringement or conflict (if the subject of any unfavorable
decision, ruling or finding) or invalidity or inadequacy, singly or in the aggregate, would
result in a Material Adverse Effect.

     (xvii) Absence of Manipulation. Neither the Company nor any affiliate of the
Company has taken, nor will the Company or any affiliate take, directly or indirectly, any
action which is designed to or which has constituted or which would be expected to cause or
result in stabilization or manipulation of the price of any security of the Company to
facilitate the sale or resale of the Securities.

     (xviii) Absence of Further Requirements. No filing with, or authorization,
approval, consent, license, order, registration, qualification or decree of, any court or
governmental authority or agency is necessary or required for the performance by the Company
of its obligations hereunder, in connection with the offering, issuance or sale of the
Securities hereunder or the consummation of the transactions contemplated by this Agreement,
except such as have been

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already obtained or as may be required under the 1933 Act or the 1933 Act Regulations
or state securities laws. 

     (xix) Possession of Licenses and Permits. The Company and its subsidiaries
possess such permits, licenses, approvals, consents and other authorizations (collectively,
“Governmental Licenses”) issued by the appropriate federal, state, local or foreign
regulatory agencies or bodies necessary to conduct the business now operated by them, except
where the failure so to possess would not, singly or in the aggregate, result in a Material
Adverse Effect; the Company and its subsidiaries are in compliance with the terms and
conditions of all such Governmental Licenses, except where the failure so to comply would
not, singly or in the aggregate, result in a Material Adverse Effect; all of the
Governmental Licenses are valid and in full force and effect, except when the invalidity of
such Governmental Licenses or the failure of such Governmental Licenses to be in full force
and effect would not, singly or in the aggregate, result in a Material Adverse Effect; and,
except as set forth in the Registration Statement and the General Disclosure Package,
neither the Company nor any of its subsidiaries has received any notice of proceedings
relating to the revocation or modification of any such Governmental Licenses which, singly
or in the aggregate, if the subject of an unfavorable decision, ruling or finding, would
result in a Material Adverse Effect.

     (xx) Title to Property. The Company and its subsidiaries have good and
marketable title to all real property owned by the Company and its subsidiaries and good
title to all other properties owned by them, in each case, free and clear of all mortgages,
pledges, liens, security interests, claims, restrictions or encumbrances of any kind except
such as (a) are described in the General Disclosure Package and the Prospectus or (b) do
not, singly or in the aggregate, materially affect the value of such property and do not
interfere with the use made and proposed to be made of such property by the Company or any
of its subsidiaries; and all of the leases and subleases material to the business of the
Company and its subsidiaries, considered as one enterprise, and under which the Company or
any of its subsidiaries holds properties described in the General Disclosure Package and the
Prospectus, are in full force and effect, and neither the Company nor any subsidiary has any
notice of any material claim of any sort that has been asserted by anyone adverse to the
rights of the Company or any subsidiary under any of the leases or subleases mentioned
above, or affecting or questioning the rights of the Company or such subsidiary to the
continued possession of the leased or subleased premises under any such lease or sublease.

     (xxi) Investment Company Act. The Company is not required, and upon the
issuance and sale of the Securities as herein contemplated and the application of the net
proceeds therefrom as described in the General Disclosure Package and the Prospectus will
not be required, to register as an “investment company” under the Investment Company Act of
1940, as amended (the “1940 Act”).

     (xxii) Environmental Laws. Except as described in the Registration Statement
and the General Disclosure Package and except as would not, singly or in the aggregate,
result in a Material Adverse Effect, (A) neither the Company nor any of its subsidiaries is
in violation of any federal, state, local or foreign statute, law, rule, regulation,
ordinance, code, policy or rule of common law or any judicial or administrative
interpretation thereof, including any judicial or administrative order, consent, decree or
judgment, relating to pollution or protection of human health, the environment (including,
without limitation, ambient air, surface water, groundwater, land surface or subsurface
strata) or wildlife, including, without limitation, laws and regulations relating to the
release or threatened release of chemicals, pollutants, contaminants, wastes, toxic
substances, hazardous substances, petroleum or petroleum products, asbestos-containing
materials or mold (collectively, “Hazardous Materials”) or to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or handling of Hazardous
Materials (collectively,

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“Environmental Laws”), (B) the Company and its subsidiaries have all permits,
authorizations and approvals required under any applicable Environmental Laws and are each
in compliance with their requirements, (C) there are no pending or, to the knowledge of the
Company, threatened administrative, regulatory or judicial actions, suits, demands, demand
letters, claims, liens, notices of noncompliance or violation, investigation or proceedings
relating to any Environmental Law against the Company or any of its subsidiaries and (D)
there are no events or circumstances that would reasonably be expected to form the basis of
an order for clean-up or remediation, or an action, suit or proceeding by any private party
or governmental body or agency, against or affecting the Company or any of its subsidiaries
relating to Hazardous Materials or any Environmental Laws.

     (xxiii) Hungarian Operations. Except as disclosed in the Registration
Statement, the General Disclosure Package and the Prospectus, there has been no Material
Adverse Effect resulting from or arising out of the Company’s or any of its subsidiaries’
operations, facilities or business activities in Hungary.

     (xxiv) Accounting Controls and Disclosure Controls. The Company and each of
its subsidiaries maintain a system of internal accounting controls sufficient to provide
reasonable assurance that: (1) transactions are executed in accordance with management’s
general or specific authorization; (2) transactions are recorded as necessary to permit
preparation of financial statements in conformity with GAAP and to maintain accountability
for assets; (3) access to assets is permitted only in accordance with management’s general
or specific authorization; and (4) the recorded accountability for assets is compared with
the existing assets at reasonable intervals and appropriate action is taken with respect to
any differences. Except as described in the General Disclosure Package and the Prospectus,
since the end of the Company’s most recent audited fiscal year, there has been (I) no
material weakness in the Company’s internal control over financial reporting (whether or not
remediated) and (II) no change in the Company’s internal control over financial reporting
that has materially affected, or is reasonably likely to materially affect, the Company’s
internal control over financial reporting.

     The Company and its consolidated subsidiaries employ disclosure controls and procedures
that are designed to ensure that information required to be disclosed by the Company in the
reports that it files or submits under the 1934 Act is recorded, processed, summarized and
reported, within the time periods specified in the Commission’s rules and forms, and is
accumulated and communicated to the Company’s management, including its principal executive
officer or officers and principal financial officer or officers, as appropriate, to allow
timely decisions regarding disclosure.

     (xxv) Compliance with the Sarbanes-Oxley Act. There is and has been no failure
on the part of the Company or any of the Company’s directors or officers, in their
capacities as such, to comply in all material respects with any provision of the
Sarbanes-Oxley Act of 2002 and the rules and regulations promulgated in connection therewith
(the “Sarbanes-Oxley Act”), including Section 402 related to loans and Sections 302 and 906
related to certifications.

     (xxvi) Pending Proceedings and Examinations. The Registration Statement is not
the subject of a pending proceeding or examination under Section 8(d) or 8(e) of the 1933
Act, and the Company is not the subject of a pending proceeding under Section 8A of the 1933
Act in connection with the offering of the Securities.

     (xxvi) Payment of Taxes. All United States federal income tax returns of the
Company and its subsidiaries required by law to be filed have been filed and all taxes shown
by such returns or otherwise assessed, which are due and payable, have been paid, except
assessments against

9

 

which appeals have been or will be promptly taken and as to which adequate reserves
have been provided. The United States federal income tax returns of the Company through the
fiscal year ended September 30, 2003 have been settled and no assessment in connection
therewith has been made against the Company. The Company and its subsidiaries have filed
all other tax returns that are required to have been filed by them pursuant to applicable
foreign, state, local or other law except insofar as the failure to file such returns would
not result in a Material Adverse Effect, and has paid all taxes due pursuant to such returns
or pursuant to any assessment received by the Company and its subsidiaries, except for such
taxes, if any, as are being contested in good faith and as to which adequate reserves have
been provided. The charges, accruals and reserves on the books of the Company in respect of
any income and corporation tax liability for any years not finally determined are adequate
to meet any assessments or re-assessments for additional income tax for any years not
finally determined, except to the extent of any inadequacy that would not result in a
Material Adverse Effect.

     (xxvii) Insurance. The Company and its subsidiaries carry or are entitled to
the benefits of insurance, with financially sound and reputable insurers, in such amounts
and covering such risks as is generally maintained by companies of established repute
engaged in the same or similar business, and all such insurance is in full force and effect.
The Company has no reason to believe that it or any subsidiary will not be able (A) to
renew its existing insurance coverage as and when such policies expire or (B) to obtain
comparable coverage from similar institutions as may be necessary or appropriate to conduct
its business as now conducted and at a cost that would not result in a Material Adverse
Effect. During the past two years, neither the Company nor any subsidiary has been denied
any insurance coverage which it has sought or for which it has applied.

     (xxviii) Statistical and Market-Related Data. Any statistical and
market-related data included in the Registration Statement, the General Disclosure Package
and the Prospectus are based on or derived from sources that the Company believes to be
reliable and accurate, and, if required, the Company has obtained the written consent to the
use of such data from such sources.

     (xxix) Foreign Corrupt Practices Act. Neither the Company nor, to the
knowledge of the Company, any director, officer, agent, employee, affiliate or other person
acting on behalf of the Company or any of its subsidiaries is aware of or has taken any
action, directly or indirectly, that would result in a violation by such persons of the
Foreign Corrupt Practices Act of 1977, as amended, and the rules and regulations thereunder
(the “FCPA”), including without limitation, making use of the mails or any means or
instrumentality of interstate commerce corruptly in the furtherance of an offer, payment,
promise to pay or authorization of the payment of any money, or other property, gift,
promise to give, or authorization of the giving of anything of value to any “foreign
official” (as such term is defined in the FCPA) or any foreign political party or official
thereof or any candidate for foreign political office, in contravention of the FCPA and the
Company and to the knowledge of the Company, its affiliates have conducted their businesses
in compliance with the FCPA and have instituted and maintain policies and procedures
designed to ensure and which are reasonable expected to continue to ensure, continued
compliance therewith.

     (xxx) Money Laundering Laws. The operations of the Company are and have been
conducted at all times in compliance with applicable financial recordkeeping and reporting
requirements of the Currency and Foreign Transactions Reporting Act of 1970, as amended, the
money laundering statutes of all jurisdictions, the rules and regulations thereunder and any
related or similar rules, regulations or guidelines, issued, administered or enforced by any
governmental agency (collectively, the “Money Laundering Laws”) and no action, suit or
proceeding by or before any court or governmental agency, authority or body or any
arbitrator involving the Company with

10

 

respect to the Money Laundering Laws is pending or, to the best knowledge of the
Company, threatened.

     (xxxi) OFAC. Neither the Company nor, to the knowledge of the Company, any
director, officer, agent, employee, affiliate or person acting on behalf of the Company is
currently subject to any U.S. sanctions administered by the Office of Foreign Assets Control
of the U.S. Treasury Department (“OFAC”); and the Company will not directly or indirectly
use the proceeds of the offering, or lend, contribute or otherwise make available such
proceeds to any subsidiary, joint venture partner or other person or entity, for the purpose
of financing the activities of any person currently subject to any U.S. sanctions
administered by OFAC.

     (b) Representations and Warranties by the Selling Shareholders. Each Selling Shareholder
severally represents and warrants to each Underwriter as of the date hereof and as of the Closing
Time, and agrees with each Underwriter, as follows:

     (i) Accurate Disclosure.

     (A) To the knowledge of such Selling Shareholder, the representations and
warranties of the Company contained in Section 1(a) hereof are true and correct;

     (B) such Selling Shareholder has reviewed and is familiar with the Registration
Statement, the General Disclosure Package and the Prospectus and: (1) has no
knowledge of any material fact, condition or information not disclosed in the
General Disclosure Package, the Prospectus or any supplement thereto which has
adversely affected or may reasonably be expected to adversely affect the business of
the Company and its subsidiaries taken as one enterprise; and (2) to his knowledge,
neither the General Disclosure Package, the Prospectus nor any amendments or
supplements thereto includes any untrue statement of a material fact or omits 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 that the representations and warranties given in this subsection
(B) by each Selling Shareholder named in Schedule B.2 (each, a “Non-Management
Selling Shareholder” and, collectively, the “Non-Management Selling Shareholders”)
apply only to statements or omissions in the Registration Statement, the General
Disclosure Package and the Prospectus made in reliance upon and in conformity with
information relating to such Non-Management Selling Shareholder furnished to the
Company or the Underwriters in writing by or on behalf of such Non-Management
Selling Shareholder expressly for use therein; and

     (C) such Selling Shareholder is not prompted to sell the Securities to be sold
by such Selling Shareholder hereunder by any information concerning the Company or
any subsidiary of the Company which is not set forth in the General Disclosure
Package or the Prospectus.

     (ii) Authorization of this Agreement. This Agreement has been duly authorized,
executed and delivered by or on behalf of such Selling Shareholder.

     (iii) Authorization of Power of Attorney and Custody Agreement. The Power of
Attorney and Custody Agreement, in the forms heretofore furnished to the Representative (the
“Power of Attorney and Custody Agreement”), have been duly authorized, executed and
delivered by such Selling Shareholder and are the valid and binding agreements of such
Selling Shareholder.

11

 

     (iv) Noncontravention. The execution and delivery of this Agreement and
the Power of Attorney and Custody Agreement, the sale and delivery of the Securities to be
sold by such Selling Shareholder, the consummation of the transactions contemplated herein
and compliance by such Selling Shareholder with its obligations hereunder do not and will
not, whether with or without the giving of notice or passage of time or both, conflict with
or constitute a breach of, or default under, or result in the creation or imposition of any
tax, lien, charge or encumbrance upon the Securities to be sold by such Selling Shareholder
or any property or assets of such Selling Shareholder pursuant to any contract, indenture,
mortgage, deed of trust, loan or credit agreement, note, license, lease or other agreement
or instrument to which such Selling Shareholder is a party or by which such Selling
Shareholder may be bound, or to which any of the property or assets of such Selling
Shareholder is subject, nor will such action result in any violation of the provisions of
the charter or by-laws or other organizational instrument of such Selling Shareholder, if
applicable, or any applicable treaty, law, statute, rule, regulation, judgment, order, writ
or decree of any government, government instrumentality or court, domestic or foreign,
having jurisdiction over such Selling Shareholder or any of its properties.

     (v) Certificates Suitable for Transfer. The Securities to be sold by such
Selling Shareholder pursuant to this Agreement are certificated securities in registered
form and are not held or, immediately prior to the Closing Time, will not be held in any
securities account or by or through any securities intermediary within the meaning of the
Uniform Commercial Code as in effect in the State of New York (the “UCC”). Certificates for
all of the Securities to be sold by such Selling Shareholder pursuant to this Agreement, in
suitable form for transfer by delivery or accompanied by duly executed instruments of
transfer or assignment in blank with signatures guaranteed, have been, or immediately prior
to the Closing Time will be, placed in custody with UMB Bank, n.a. (the “Custodian”) with
irrevocable conditional instructions to deliver such Securities to the Underwriters pursuant
to this Agreement. 

     (vi) Valid Title. Such Selling Shareholder has, and at the Closing Time will
have, valid title to the Securities to be sold by such Selling Shareholder free and clear of
all security interests, claims, liens, equities or other encumbrances and the legal right
and power, and all authorization and approval required by law, to enter into this Agreement
and the Power of Attorney and Custody Agreement and to sell, transfer and deliver the
Securities to be sold by such Selling Shareholder.

     (vii) Delivery of Securities. Upon the Underwriters’ acquiring possession of
the Securities to be sold by such Selling Shareholder and paying the purchase price therefor
pursuant to this Agreement, the Underwriters (assuming that no such Underwriter has notice
of any “adverse claim,” within the meaning of Section 8-105 of the New York Uniform
Commercial Code, to such Securities) will acquire their respective interests in such
Securities (including, without limitation, all rights that such Selling Shareholder had or
has the power to transfer in such Securities) free and clear of any adverse claim within the
meaning of Section 8-102 of the New York Uniform Commercial Code.

     (viii) Absence of Manipulation. Such Selling Shareholder has not taken, and
will not take, directly or indirectly, any action which is designed to or which has
constituted or which would be expected to cause or result in stabilization or manipulation
of the price of any security of the Company to facilitate the sale or resale of the
Securities.

     (ix) Absence of Further Requirements. No filing with, or consent, approval,
authorization, order, registration, qualification or decree of, any court or governmental
authority or agency, domestic or foreign, is necessary or required for the performance by
each Selling Shareholder of its obligations hereunder or in the Power of Attorney and
Custody Agreement, or in

12

 

connection with the sale and delivery of the Securities hereunder or the consummation
of the transactions contemplated by this Agreement, except such as may have previously been
made or obtained or as may be required under the 1933 Act or the 1933 Act Regulations or
state securities laws.

     (x) Restriction on Sale of Securities. During a period of 90 days from the
date of the Prospectus, such Selling Shareholder will not, without the prior written consent
of Merrill Lynch, (i) offer, pledge, sell, contract to sell, sell any option or contract to
purchase, purchase any option or contract to sell, grant any option, right or warrant to
purchase or otherwise transfer or dispose of, directly or indirectly, any share of Common
Stock or any securities convertible into or exercisable or exchangeable for Common Stock or
file, or cause to be filed, any registration statement under the 1933 Act with respect to
any of the foregoing or (ii) enter into any swap or any other agreement or any transaction
that transfers, in whole or in part, directly or indirectly, the economic consequence of
ownership of the Common Stock, whether any such swap or transaction described in clause (i)
or (ii) above is to be settled by delivery of Common Stock or such other securities, in cash
or otherwise. The foregoing sentence shall not apply to the Securities to be sold
hereunder. Notwithstanding the foregoing, if (1) during the last 17 days of the 90-day
restricted period the Company issues an earnings release or material news or a material
event relating to the Company occurs or (2) prior to the expiration of the 90-day restricted
period, the Company announces that it will release earnings results or becomes aware that
material news or a material event will occur during the 16-day period beginning on the last
day of the 90-day restricted period, the restrictions imposed in this clause (x) shall
continue to apply until the expiration of the 18-day period beginning on the issuance of the
earnings release or the occurrence of the material news or material event.

     (xi) No Association with NASD. Except as set forth on Schedule G hereto,
neither such Selling Shareholder nor any of his affiliates directly, or indirectly through
one or more intermediaries, controls, or is controlled by, or is under common control with,
or is a person associated with (within the meaning of Article I (dd) of the By-laws of the
National Association of Securities Dealers, Inc.), any member firm of the National
Association of Securities Dealers, Inc.

     (c) Officer’s Certificates. Any certificate signed by any officer of the Company or any of
its subsidiaries delivered to the Representative or to counsel for the Underwriters shall be deemed
a representation and warranty by the Company to each Underwriter as to the matters covered thereby;
and any certificate signed by or on behalf of the Selling Shareholders as such and delivered to the
Representative or to counsel for the Underwriters pursuant to the terms of this Agreement shall be
deemed a representation and warranty by such Selling Shareholder to the Underwriters as to the
matters covered thereby.

     SECTION 2. Sale and Delivery to Underwriters; Closing.

     (a) Initial Securities. On the basis of the representations and warranties herein contained
and subject to the terms and conditions herein set forth, the Company and each Selling Shareholder,
severally and not jointly, agree to sell to each Underwriter, severally and not jointly, and each
Underwriter, severally and not jointly, agrees to purchase from the Company and each Selling
Shareholder, at the price per share set forth in Schedule D, that proportion of the number of
Initial Securities set forth in Schedule B opposite the name of the Company or such Selling
Shareholder, as the case may be, which the number of Initial Securities set forth in Schedule A
opposite the name of such Underwriter, plus any additional number of Initial Securities which such
Underwriter may become obligated to purchase pursuant to the provisions of Section 10 hereof, bears
to the total number of Initial Securities, subject, in each case, to such adjustments

13

 

among the Underwriters as the Representative in its sole discretion shall make to eliminate
any sales or purchases of fractional securities.

     (b) Option Securities. In addition, on the basis of the representations and warranties herein
contained and subject to the terms and conditions herein set forth, the Company hereby grants an
option to the Underwriters to purchase, severally and not jointly, up to an additional 600,000
shares of Common Stock, as set forth in Schedule B, at the price per share set forth in Schedule D,
less an amount per share equal to any dividends or distributions declared by the Company and
payable on the Initial Securities but not payable on the Option Securities. The option hereby
granted will expire 30 days after the date hereof and may be exercised in whole or in part from
time to time only for the purpose of covering overallotments which may be made in connection with
the offering and distribution of the Initial Securities upon notice by Merrill Lynch to the Company
setting forth the number of Option Securities as to which the several Underwriters are then
exercising the option and the time and date of payment and delivery for such Option Securities.
Any such time and date of delivery (a “Date of Delivery”) shall be determined by Merrill Lynch, but
shall not be later than seven full business days after the exercise of said option, nor in any
event prior to the Closing Time, as hereinafter defined. If the option is exercised as to all or
any portion of the Option Securities, each of the Underwriters, acting severally and not jointly,
will purchase that proportion of the total number of Option Securities then being purchased which
the number of Initial Securities set forth in Schedule A opposite the name of such Underwriter
bears to the total number of Initial Securities, subject in each case to such adjustments as
Merrill Lynch in its discretion shall make to eliminate any sales or purchases of fractional
shares.

     (c) Payment. Payment of the purchase price for, and delivery of certificates for, the Initial
Securities shall be made at the offices of Winston & Strawn LLP, 35 West Wacker Drive, Chicago,
Illinois 60601, or at such other place as shall be agreed upon by the Representative and the
Company and the Selling Shareholders, at 9:00 A.M. (Eastern time) on the third (fourth, if the
pricing occurs after 4:30 P.M. (Eastern time) on any given day) business day after the date hereof
(unless postponed in accordance with the provisions of Section 10), or such other time not later
than ten business days after such date as shall be agreed upon by the Representative and the
Company and the Selling Shareholders (such time and date of payment and delivery being herein
called “Closing Time”).

     In addition, in the event that any or all of the Option Securities are purchased by the
Underwriters, payment of the purchase price for, and delivery of certificates for, such Option
Securities shall be made at the above-mentioned offices, or at such other place as shall be agreed
upon by the Representative and the Company, on each Date of Delivery as specified in the notice
from the Representative to the Company.

     Payment shall be made to the Company and the Selling Shareholders by wire transfer of
immediately available funds to bank accounts designated by the Company and the Custodian pursuant
to each Selling Shareholder’s Power of Attorney and Custody Agreement, as the case may be, against
delivery to the Representative for the respective accounts of the Underwriters of certificates for
the Securities to be purchased by them. It is understood that each Underwriter has authorized the
Representative, for its account, to accept delivery of, receipt for, and make payment of the
purchase price for, the Initial Securities and the Option Securities, if any, which it has agreed
to purchase. Merrill Lynch, individually and not as representative of the Underwriters, may (but
shall not be obligated to) make payment of the purchase price for the Initial Securities or the
Option Securities, if any, to be purchased by any Underwriter whose funds have not been received by
the Closing Time or the relevant Date of Delivery, as the case may be, but such payment shall not
relieve such Underwriter from its obligations hereunder.

     (d) Denominations; Registration. Certificates for the Initial Securities and the Option
Securities, if any, shall be in such denominations and registered in such names as the
Representative may request in writing at least one full business day before the Closing Time or the
relevant Date of Delivery, as

14

 

the case may be. The certificates for the Initial Securities and the Option Securities, if
any, will be made available for examination and packaging by the Representative in The City of New
York not later than 10:00 A.M. (Eastern time) on the business day prior to the Closing Time or the
relevant Date of Delivery, as the case may be.

     SECTION 3. Covenants of the Company and the Selling Shareholders. The Company
covenants with each Underwriter as follows:

     (a) Compliance with Securities Regulations and Commission Requests. The Company,
subject to Section 3(b), will comply with the requirements of Rule 430B and will notify the
Representative immediately, and confirm the notice in writing, (i) when any post-effective
amendment to the Registration Statement or new registration statement relating to the
Securities shall become effective, or any supplement to the Prospectus or any amended
Prospectus shall have been filed, (ii) of the receipt of any comments from the Commission,
(iii) of any request by the Commission for any amendment to the Registration Statement or
the filing of a new registration statement or any amendment or supplement to the Prospectus
or any document incorporated by reference therein or otherwise deemed to be a part thereof
or for additional information, (iv) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or such new registration
statement or of any order preventing or suspending the use of any preliminary prospectus, or
of the suspension of the qualification of the Securities for offering or sale in any
jurisdiction, or of the initiation or threatening of any proceedings for any of such
purposes or of any examination pursuant to Section 8(e) of the 1933 Act concerning the
Registration Statement and (v) if the Company becomes the subject of a proceeding under
Section 8A of the 1933 Act in connection with the offering of the Securities. The Company
will effect the filings required under Rule 424(b), in the manner and within the time period
required by Rule 424(b) (without reliance on Rule 424(b)(8)), and will take such steps as it
deems necessary to ascertain promptly whether the form of prospectus transmitted for filing
under Rule 424(b) was received for filing by the Commission and, in the event that it was
not, will promptly file such prospectus. The Company will make every reasonable effort to
prevent the issuance of any stop order and, if any stop order is issued, to obtain the
lifting thereof at the earliest possible moment.

     (b) Filing of Amendments and Exchange Act Documents. The Company will give the
Representative notice of its intention to file or prepare any amendment to the Registration
Statement or new registration statement relating to the Securities or any amendment,
supplement or revision to either any preliminary prospectus relating to the Securities
(including any prospectus included in the Original Registration Statement or amendment
thereto at the time it became effective) or to the Prospectus, whether pursuant to the 1933
Act, the 1934 Act or otherwise, and the Company will furnish the Representative with copies
of any such documents a reasonable amount of time prior to such proposed filing or use, as
the case may be, and will not file or use any such document to which the Representative or
counsel for the Underwriters shall object. The Company has given the Representative notice
of any filings made pursuant to the 1934 Act or 1934 Act Regulations within 48 hours prior
to the execution of this Agreement; and the Company will give the Representative notice of
its intention to make any such filing from the execution of this Agreement to the Closing
Time and will furnish the Representative with copies of any such documents a reasonable
amount of time prior to such proposed filing and will not file or use any such document to
which the Representative or counsel for the Underwriters shall object.

     (c) Delivery of Registration Statements. The Company has furnished or will deliver to
the Representative and counsel for the Underwriters, without charge, signed copies of the
Original Registration Statement and of each amendment thereto (including exhibits filed
therewith or incorporated by reference therein and documents incorporated or deemed to be
incorporated by

15

 

reference therein or otherwise deemed to be a part thereof) and signed copies of all
consents and certificates of experts, and will also deliver to the Representative, without
charge, a conformed copy of the Original Registration Statement and of each amendment
thereto (without exhibits) for each of the Underwriters. The copies of the Original
Registration Statement and each amendment thereto furnished to the Underwriters will be
identical to the electronically transmitted copies thereof filed with the Commission
pursuant to EDGAR, except to the extent permitted by Regulation S-T.

     (d) Delivery of Prospectuses. The Company has delivered to each Underwriter, without
charge, as many copies of each preliminary prospectus as such Underwriter reasonably
requested, and the Company hereby consents to the use of such copies for purposes permitted
by the 1933 Act. The Company will furnish to each Underwriter, without charge, during the
period when the Prospectus is required to be delivered under the 1933 Act, such number of
copies of the Prospectus (as amended or supplemented) as such Underwriter may reasonably
request. The Prospectus and any amendments or supplements thereto furnished to the
Underwriters will be identical to the electronically transmitted copies thereof filed with
the Commission pursuant to EDGAR, except to the extent permitted by Regulation S-T.

     (e) Continued Compliance with Securities Laws. The Company will comply with the 1933
Act and the 1933 Act Regulations and the 1934 Act and the 1934 Act Regulations so as to
permit the completion of the distribution of the Securities as contemplated in this
Agreement and in the Prospectus. If at any time when a prospectus is required by the 1933
Act to be delivered in connection with sales of the Securities, any event shall occur or
condition shall exist as a result of which it is necessary, in the opinion of counsel for
the Underwriters or for the Company, to amend the Registration Statement or amend or
supplement the Prospectus in order that the Prospectus will not include any untrue statement
of a material fact or omit to state a material fact necessary in order to make the
statements therein not misleading in the light of the circumstances existing at the time it
is delivered to a purchaser, or if it shall be necessary, in the opinion of such counsel, at
any such time to amend the Registration Statement or to file a new registration statement or
amend or supplement the Prospectus in order to comply with the requirements of the 1933 Act
or the 1933 Act Regulations, the Company will promptly prepare and file with the Commission,
subject to Section 3(b), such amendment, supplement or new registration statement as may be
necessary to correct such statement or omission or to comply with such requirements, the
Company will use its best efforts to have such amendment or new registration statement
declared effective as soon as practicable (if it is not an automatic shelf registration
statement with respect to the Securities) and the Company will furnish to the Underwriters
such number of copies of such amendment, supplement or new registration statement as the
Underwriters may reasonably request. If at any time following issuance of an Issuer Free
Writing Prospectus there occurred or occurs an event or development as a result of which
such Issuer Free Writing Prospectus conflicted or would conflict with the information
contained in the Registration Statement (or any other registration statement relating to the
Securities) or the Statutory Prospectus or any preliminary prospectus or included or would
include an untrue statement of a material fact or omitted or would omit to state a material
fact necessary in order to make the statements therein, in the light of the circumstances
prevailing at that subsequent time, not misleading, the Company will promptly notify Merrill
Lynch and will promptly amend or supplement, at its own expense, such Issuer Free Writing
Prospectus to eliminate or correct such conflict, untrue statement or omission.

     (f) Blue Sky Qualifications. The Company will use its best efforts, in cooperation
with the Underwriters, to qualify the Securities for offering and sale under the applicable
securities laws of such states and other jurisdictions (domestic or foreign) as the
Representative may designate and to maintain such qualifications in effect for a period of
not less than one year from the date hereof;

16

 

provided, however, that the Company shall not be obligated to file any general consent
to service of process or to qualify as a foreign corporation or as a dealer in securities in
any jurisdiction in which it is not so qualified or to subject itself to taxation in respect
of doing business in any jurisdiction in which it is not otherwise so subject.

     (g) Rule 158. The Company will timely file such reports pursuant to the 1934 Act as
are necessary in order to make generally available to its security holders as soon as
practicable an earning statement for the purposes of, and to provide to the Underwriters the
benefits contemplated by, the last paragraph of Section 11(a) of the 1933 Act and Rule 158
thereunder.

     (h) Use of Proceeds. The Company will use the net proceeds received by it from the
sale of the Securities in the manner specified in the Prospectus under “Use of Proceeds.”

     (i) Listing. The Company will use its best efforts to effect and maintain the
quotation of the Securities on the NASDAQ Global Market.

     (j) Restriction on Sale of Securities. During a period of 90 days from the date of the
Prospectus, the Company will not, without the prior written consent of Merrill Lynch, (i)
directly or indirectly, offer, pledge, sell, contract to sell, sell any option or contract
to purchase, purchase any option or contract to sell, grant any option, right or warrant to
purchase or otherwise transfer or dispose of any share of Common Stock or any securities
convertible into or exercisable or exchangeable for Common Stock or file any registration
statement under the 1933 Act with respect to any of the foregoing or (ii) enter into any
swap or any other agreement or any transaction that transfers, in whole or in part, directly
or indirectly, the economic consequence of ownership of the Common Stock, whether any such
swap or transaction described in clause (i) or (ii) above is to be settled by delivery of
Common Stock or such other securities, in cash or otherwise. The foregoing sentence shall
not apply to (A) the Securities to be sold hereunder, (B) any shares of Common Stock issued
by the Company upon the exercise of an option or warrant or the conversion of a security
outstanding on the date hereof and referred to in the Prospectus (including the information
incorporated therein by reference), (C) any shares of Common Stock issued or options to
purchase Common Stock granted pursuant to existing employee benefit plans of the Company
referred to in the Prospectus or (D) any shares of Common Stock issued pursuant to any
non-employee director stock plan or dividend reinvestment plan. Notwithstanding the
foregoing, if (1) during the last 17 days of the 90-day restricted period the Company issues
an earnings release or material news or a material event relating to the Company occurs or
(2) prior to the expiration of the 90-day restricted period, the Company announces that it
will release earnings results or becomes aware that material news or a material event will
occur during the 16-day period beginning on the last day of the 90-day restricted period,
the restrictions imposed in this clause (j) shall continue to apply until the expiration of
the 18-day period beginning on the issuance of the earnings release or the occurrence of the
material news or material event.

     (k) Reporting Requirements. The Company, during the period when the Prospectus is
required to be delivered under the 1933 Act, will file all documents required to be filed
with the Commission pursuant to the 1934 Act within the time periods required by the 1934
Act and the 1934 Act Regulations.

     (l) Issuer Free Writing Prospectuses. Each of the Company and each Selling Shareholder
represents and agrees that, unless it obtains the prior consent of the Representative, and
each Underwriter represents and agrees that, unless it obtains the prior consent of the
Company and the Representative, it has not made and will not make any offer relating to the
Securities that would constitute an “issuer free writing prospectus,” as defined in Rule
433, or that would otherwise

17

 

constitute a “free writing prospectus,” as defined in Rule 405, required to be filed
with the Commission or, in the case of each Selling Shareholder, whether or not required to
be filed with the Commission. Any such free writing prospectus consented to by the
Representative or by the Company and the Representative, as the case may be, is hereinafter
referred to as a “Permitted Free Writing Prospectus.” Each of the Company and each Selling
Shareholder represents that it has treated or agrees that it will treat each Permitted Free
Writing Prospectus as an “issuer free writing prospectus,” as defined in Rule 433, and has
complied and will comply with the requirements of Rule 433 applicable to any Permitted Free
Writing Prospectus, including timely filing with the Commission where required, legending
and record keeping. 

     SECTION 4. Payment of Expenses.

     (a) Expenses. The Company will pay or cause to be paid all expenses incident to the
performance of the obligations of the Company and the Selling Shareholders under this Agreement,
including (i) the preparation, printing and filing of the Registration Statement (including
financial statements and exhibits) as originally filed and of each amendment thereto, (ii) the
preparation, printing and delivery to the Underwriters of this Agreement, any Agreement among
Underwriters and such other documents as may be required in connection with the offering, purchase,
sale, issuance or delivery of the Securities, (iii) the preparation, issuance and delivery of the
certificates for the Securities to the Underwriters, including any stock or other transfer taxes
and any stamp or other duties payable upon the sale, issuance or delivery of the Securities to the
Underwriters, (iv) the fees and disbursements of the Company’s counsel, accountants and other
advisors, (v) the qualification of the Securities under securities laws in accordance with the
provisions of Section 3(f) hereof, including filing fees and the reasonable fees and disbursements
of counsel for the Underwriters in connection therewith and in connection with the preparation of
the Blue Sky Survey and any supplement thereto, (vi) the printing and delivery to the Underwriters
of copies of each preliminary prospectus, any Permitted Free Writing Prospectus and of the
Prospectus and any amendments or supplements thereto and any costs associated with electronic
delivery of any of the foregoing by the Underwriters to investors, (vii) the preparation, printing
and delivery to the Underwriters of copies of the Blue Sky Survey and any supplement thereto,
(viii) the fees and expenses of any transfer agent or registrar for the Securities, (ix) the costs
and expenses of the Company relating to investor presentations on any “road show” undertaken in
connection with the marketing of the Securities, 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 and lodging expenses of the representatives
and officers of the Company and any such consultants, and the cost of aircraft chartered by the
Company in connection with the road show, provided that the underwriters shall pay their
own lodging expenses in connection with the road show presentations and shall pay the costs and
expenses associated with ground transportation and group meals in connection with the road show
presentations, (x) the filing fees incident to, and the reasonable fees and disbursements of
counsel to the Underwriters in connection with, the review by the National Association of
Securities Dealers, Inc. (the “NASD”) of the terms of the sale of the Securities, if required, and
(xi) the fees and expenses incurred in connection with the inclusion of the Securities in the
NASDAQ Global Market.

     (b) Expenses of the Selling Shareholders. Except as provided in Section 4(a), the Selling
Shareholders will pay all expenses incident to the performance of their respective obligations
under, and the consummation of the transactions contemplated by this Agreement, including (i) any
stamp duties, capital duties and stock transfer taxes, if any, payable upon the sale of the
Securities to the Underwriters, and their transfer between the Underwriters pursuant to an
agreement between such Underwriters, and (ii) the fees and disbursements of their respective
counsel and other advisors.

     (c) Termination of Agreement. If this Agreement is terminated by the Representative in
accordance with the provisions of Section 5, Section 9(a)(i) or Section 11 hereof, the Company
shall

18

 

reimburse the Underwriters for all of their out-of-pocket expenses, including the reasonable
fees and disbursements of counsel for the Underwriters.

     (d) Allocation of Expenses. The provisions of this Section shall not affect any agreement
that the Company and the Selling Shareholders may make for the sharing of such costs and expenses.

     SECTION 5. Conditions of Underwriters’ Obligations. The obligations of the several
Underwriters hereunder are subject to the accuracy of the representations and warranties of the
Company and the Selling Shareholders contained in Section 1 hereof or in certificates of any
officer of the Company or any subsidiary of the Company or on behalf of any Selling Shareholder
delivered pursuant to the provisions hereof, to the performance by the Company of its covenants and
other obligations hereunder, and to the following further conditions:

     (a) Effectiveness of Registration Statement; Filing of Prospectus. The Registration Statement
has become effective and at Closing Time no stop order suspending the effectiveness of the
Registration Statement shall have been issued under the 1933 Act or proceedings therefore initiated
or threatened by the Commission, and any request on the part of the Commission for additional
information shall have been complied with to the reasonable satisfaction of counsel to the
Underwriters. A prospectus containing the Rule 430B Information shall have been filed with the
Commission in the manner and within the time period required by Rule 424(b) without reliance on
Rule 424(b)(8) (or a post-effective amendment providing such information shall have been filed and
become effective in accordance with the requirements of Rule 430B).

     (b) Opinion of Counsel for the Company. At Closing Time, the Representative shall have
received the favorable opinion, dated as of Closing Time, of Thompson Coburn LLP, counsel for the
Company, in form and substance satisfactory to counsel for the Underwriters, together with signed
or reproduced copies of such letter for each of the other Underwriters to the effect set forth in
Exhibit A hereto and to such further effect as counsel to the Underwriters may reasonably request.

     (c) Opinion of Hungarian Counsel for the Company. At Closing Time, the Representative shall
have received the favorable opinion, dated as of Closing Time, of Sándor Szegedi Szent-Ivány
Komáromi Eversheds, Hungarian counsel for the Company, in form and substance satisfactory to
counsel for the Underwriters, together with signed or reproduced copies of such letter for each of
the other Underwriters to the effect set forth in Exhibit B hereto and to such further effect as
counsel to the Underwriters may reasonably request.

     (d) Opinion of Counsel for the Selling Shareholders. At Closing Time, the Representative
shall have received the favorable opinion, dated as of Closing Time, of Thompson Coburn LLP,
counsel for the Selling Shareholders, in form and substance satisfactory to counsel for the
Underwriters, together with signed or reproduced copies of such letter for each of the other
Underwriters to the effect set forth in Exhibit C hereto and to such further effect as counsel to
the Underwriters may reasonably request.

     (e) Opinion of Counsel for the Underwriters. At Closing Time, the Representative shall have
received the favorable opinion, dated as of Closing Time, of Winston & Strawn LLP, counsel for the
Underwriters, together with signed or reproduced copies of such letter for each of the other
Underwriters with respect to the matters set forth in clauses (i), (ii), (v), (vi) (solely as to
preemptive or other similar rights arising by operation of law or under the charter or by-laws of
the Company), (viii) through (x), inclusive, (xii), (xiv) (solely as to the information in the
Prospectus under “Description of Capital Stock—Common Stock”) and the penultimate paragraph of
Exhibit A hereto. In giving such opinion such counsel may rely, as to all matters governed by the
laws of jurisdictions other than the law of the State of New York and the federal law of the United
States, upon the opinions of counsel satisfactory to the Representative. Such counsel may also
state that, insofar as such opinion involves factual matters, they have relied, to the

19

 

extent they deem proper, upon certificates of officers of the Company and its subsidiaries and
certificates of public officials.

     (f) Material Adverse Change; Officers’ Certificate. At Closing Time, there shall not have
been, since the date hereof, since the Applicable Time or since the respective dates as of which
information is given in the Prospectus or the General Disclosure Package, any material adverse
change in the condition, financial or otherwise, or in the earnings, business affairs or business
prospects of the Company and its subsidiaries considered as one enterprise, whether or not arising
in the ordinary course of business, and the Representative shall have received a certificate of the
President or a Vice President of the Company and of the chief financial or chief accounting officer
of the Company, dated as of Closing Time, to the effect that (i) there has been no such material
adverse change, (ii) the representations and warranties in Section 1(a) hereof are true and correct
with the same force and effect as though expressly made at and as of Closing Time, (iii) the
Company has complied with all agreements and satisfied all conditions on its part to be performed
or satisfied at or prior to Closing Time, and (iv) no stop order suspending the effectiveness of
the Registration Statement has been issued and no proceedings for that purpose have been instituted
or are pending or, to their knowledge, contemplated by the Commission.

     (g) Certificate of the Selling Shareholders. At Closing Time, the Representative shall have
received a certificate of an Attorney-in-Fact on behalf of each Selling Shareholder, dated as of
Closing Time, to the effect that (i) the representations and warranties of such Selling
Shareholder contained in Section 1(b) hereof are true and correct in all respects with the same
force and effect as though expressly made at and as of Closing Time and (ii) such Selling
Shareholder has complied in all material respects with all agreements and all conditions on its
part to be performed under this Agreement at or prior to Closing Time.

     (h) Accountant’s Comfort Letters. At the time of the execution of this Agreement, the
Representative shall have received from each of PricewaterhouseCoopers LLP and Grant Thornton LLP a
letter dated such date, in form and substance satisfactory to the Representative, together with
signed or reproduced copies of such letters for each of the other Underwriters containing
statements and information of the type ordinarily included in accountants’ “comfort letters” to
underwriters with respect to the financial statements and certain financial information contained
in the Registration Statement and the Prospectus.

     (i) Bring-down Comfort Letter. At Closing Time, the Representative shall have received from
Grant Thornton LLP a letter, dated as of Closing Time, to the effect that they reaffirm the
statements made in their letter furnished pursuant to subsection (h) of this Section, except that
the specified date referred to shall be a date not more than three business days prior to Closing
Time.

     (j) Approval of Listing. At Closing Time, the Securities shall have been approved for
inclusion in the NASDAQ Global Market, subject only to official notice of issuance.

     (k) Lock-up Agreements. At the date of this Agreement, the Representative shall have received
an agreement substantially in the form of Exhibit D hereto signed by the persons listed on Schedule
H hereto.

     (l) Maintenance of Rating. Since the execution of this Agreement, there shall not have been
any decrease in the rating of any of the Company’s securities by any “nationally recognized
statistical rating organization” (as defined for purposes of Rule 436(g) under the 1933 Act) or any
notice given of any intended or potential decrease in any such rating or of a possible change in
any such rating that does not indicate the direction of the possible change.

     (m) Conditions to Purchase of Option Securities. In the event that the Underwriters exercise their
option provided in Section 2(b) hereof to purchase all or any portion of the Option Securities, the

20

 

representations and warranties of the Company contained herein and the statements in any
certificates furnished by the Company and any subsidiary of the Company hereunder shall be true and
correct as of each Date of Delivery and, at the relevant Date of Delivery, the Representative shall
have received:

	 	(i)	 	Officers’ Certificate. A certificate, dated such Date
of Delivery, of the President or a Vice President of the Company and of the
chief financial or chief accounting officer of the Company confirming that the
certificate delivered at the Closing Time pursuant to Section 5(f) hereof
remains true and correct as of such Date of Delivery.
	 
	 	(ii)	 	Opinion of Counsel for the Company. The favorable
opinion of Thompson Coburn LLP, counsel for the Company, in form and substance
satisfactory to counsel for the Underwriters, dated such Date of Delivery,
relating to the Option Securities to be purchased on such Date of Delivery and
otherwise to the same effect as the opinion required by Section 5(b) hereof.
	 
	 	(iii)	 	Opinion of Hungarian Counsel for the Company. The
favorable opinion of Sándor Szegedi Szent-Ivány Komáromi Eversheds, Hungarian
counsel for the Company, in form and substance satisfactory to counsel for the
Underwriters, dated such Date of Delivery, relating to the Option Securities to
be purchased on such Date of Delivery and otherwise to the same effect as the
opinion required by Section 5(c) hereof.
	 
	 	(iii)	 	Opinion of Counsel for the Underwriters. The
favorable opinion of Winston & Strawn LLP, counsel for the Underwriters, dated
such Date of Delivery, relating to the Option Securities to be purchased on
such Date of Delivery and otherwise to the same effect as the opinion required
by Section 5(e) hereof.
	 
	 	(iv)	 	Bring-down Comfort Letter. A letter from Grant
Thornton LLP, in form and substance satisfactory to the Representative and
dated such Date of Delivery, substantially in the same form and substance as
their letter furnished to the Representative pursuant to Section 5(h) hereof,
except that the “specified date” in the letter furnished pursuant to this
paragraph shall be a date not more than five days prior to such Date of
Delivery.

     (n) Additional Documents. At Closing Time and at each Date of Delivery, counsel for the
Underwriters shall have been furnished with such documents and opinions as they may require for the
purpose of enabling them to pass upon the issuance and sale of the Securities as herein
contemplated, or in order to evidence the accuracy of any of the representations or warranties, or
the fulfillment of any of the conditions, herein contained; and all proceedings taken by the
Company and the Selling Shareholders in connection with the issuance and sale of the Securities as
herein contemplated shall be satisfactory in form and substance to the Representative and counsel
for the Underwriters.

     (o) Termination of Agreement. If any condition specified in this Section shall not have been
fulfilled when and as required to be fulfilled, this Agreement, or, in the case of any condition to
the purchase of Option Securities on a Date of Delivery which is after the Closing Time, the
obligations of the several Underwriters to purchase the relevant Option Securities, may be
terminated by the Representative by notice to the Company and the Selling Shareholders, as
applicable, at any time at or prior to Closing Time or such Date of Delivery, as the case may be,
and such termination shall be without liability of any party to any other party except as provided in Section 4 and except that Sections 1, 6, 7 and 8
shall survive any such termination and remain in full force and effect.

21

 

     SECTION 6. Indemnification.

     (a) Indemnification of Underwriters by the Company. The Company agrees to indemnify and hold
harmless each Underwriter, its affiliates, as such term is defined in Rule 501(b) under the 1933
Act (each, an “Affiliate”), its selling agents and each person, if any, who controls any
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act as
follows:

     (i) against any and all loss, liability, claim, damage and expense whatsoever, as
incurred, arising out of any untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement (or any amendment thereto), including the Rule 430B
Information, or the omission or alleged omission therefrom of a material fact required to be
stated therein or necessary to make the statements therein not misleading or arising out of
any untrue statement or alleged untrue statement of a material fact included in any
preliminary prospectus, any Issuer Free Writing Prospectus, the Prospectus (or any amendment
or supplement thereto), any “road show” (as defined in Rule 433) not constituting an Issuer
Free Writing Prospectus (a “Non-Prospectus Road Show”) or any Blue Sky application or other
document prepared or executed by the Company (or based upon any written information
furnished by the Company for use therein) specifically for the purpose of qualifying any or
all of the Securities under the securities laws of any state or other jurisdiction (any such
application, document or information being hereinafter called a “Blue Sky Application”), or
the omission or alleged omission therefrom of a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were made, not
misleading;

     (ii) against any and all loss, liability, claim, damage and expense whatsoever, as
incurred, to the extent of the aggregate amount paid in settlement of any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or threatened, or
of any claim whatsoever based upon any such untrue statement or omission, or any such
alleged untrue statement or omission; provided that (subject to Section 6(e) below) any such
settlement is effected with the written consent of the Company; and

     (iii) against any and all expense whatsoever, as incurred (including the fees and
disbursements of counsel chosen by Merrill Lynch), reasonably incurred in investigating,
preparing or defending against any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim whatsoever based upon any
such untrue statement or omission, or any such alleged untrue statement or omission, to the
extent that any such expense is not paid under (i) or (ii) above;

provided, however, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue statement or omission
or alleged untrue statement or omission made in reliance upon and in conformity with written
information furnished to the Company by any Underwriter through Merrill Lynch expressly for use in
the Registration Statement (or any amendment thereto), including the Rule 430B Information, or any
preliminary prospectus, any Issuer Free Writing Prospectus or the Prospectus (or any amendment or
supplement thereto).

     (b) Indemnification of Underwriters by the Selling Shareholders. Each Selling Shareholder,
severally and not jointly, agrees to indemnify and hold harmless each Underwriter, its Affiliates
and selling agents and each person, if any, who controls any Underwriter within the meaning of
Section 15 of the 1933 Act or Section 20 of the 1934 Act to the extent and in the manner set forth
in clauses (a)(i), (ii) and (iii) above; provided, however, that: (1) each such
Selling Shareholder shall be liable only to the extent that such Selling Shareholder had knowledge
of such untrue statement or omission or alleged untrue statement or omission; (2) the aggregate
indemnification liability of each Selling Shareholder shall not exceed the net

22

 

proceeds received by such person for the sale of the Securities sold by such person in the
public offering pursuant to this Agreement; (3) each Non-Management Selling Shareholder shall be
liable only to the extent that such untrue statement or omission or alleged untrue statement or
omission has been made in the Registration Statement, any preliminary prospectus, the Prospectus,
any Non-Prospectus Road Show, any Blue Sky Application or such amendment or supplement in reliance
upon and in conformity with information furnished by such Non-Management Selling Shareholder
expressly for use in such document; and (4) before such Selling Shareholder shall be liable to the
Underwriters under this Section 6(b), the Underwriters shall have first made demand for payment or
any amounts due under subsection (a) and the Company shall not have made payment of all of such
amounts within 90 days following such demand.

     (c) Indemnification of Company, Directors and Officers and Selling Shareholders. Each
Underwriter severally agrees to indemnify and hold harmless the Company, its directors, each of its
officers who signed the Registration Statement, and each person, if any, who controls the Company
within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act, and each Selling
Shareholder against any and all loss, liability, claim, damage and expense described in the
indemnity contained in subsection (a) of this Section, as incurred, but only with respect to untrue
statements or omissions, or alleged untrue statements or omissions, made in the Registration
Statement (or any amendment thereto), including the Rule 430B Information or any preliminary
prospectus, any Issuer Free Writing Prospectus, any Non-Prospectus Road Show, any Blue Sky
Application or the Prospectus (or any amendment or supplement thereto) in reliance upon and in
conformity with written information furnished to the Company by such Underwriter through Merrill
Lynch expressly for use therein. 

     (d) Actions against Parties; Notification. Each indemnified party shall give notice as
promptly as reasonably practicable to each indemnifying party of any action commenced against it in
respect of which indemnity may be sought hereunder, but failure to so notify an indemnifying party
shall not relieve such indemnifying party from any liability hereunder to the extent it is not
materially prejudiced as a result thereof and in any event shall not relieve it from any liability
which it may have otherwise than on account of this indemnity agreement. In the case of parties
indemnified pursuant to Sections 6(a) and 6(b) above, counsel to the indemnified parties shall be
selected by Merrill Lynch, and, in the case of parties indemnified pursuant to Section 6(c) above,
counsel to the indemnified parties shall be selected by the Company. An indemnifying party may
participate at its own expense in the defense of any such action; provided,
however, that counsel to the indemnifying party shall not (except with the consent of the
indemnified party) also be counsel to the indemnified party. In no event shall the indemnifying
parties be liable for fees and expenses of more than one counsel (in addition to any local counsel)
separate from their own counsel for all indemnified parties in connection with any one action or
separate but similar or related actions in the same jurisdiction arising out of the same general
allegations or circumstances. No indemnifying party shall, without the prior written consent of
the indemnified parties, settle or compromise or consent to the entry of any judgment with respect
to any litigation, or any investigation or proceeding by any governmental agency or body, commenced
or threatened, or any claim whatsoever in respect of which indemnification or contribution could be
sought under this Section 6 or Section 7 hereof (whether or not the indemnified parties are actual
or potential parties thereto), unless such settlement, compromise or consent (i) includes an
unconditional release of each indemnified party from all liability arising out of such litigation,
investigation, proceeding or claim and (ii) does not include a statement as to or an admission of
fault, culpability or a failure to act by or on behalf of any indemnified party.

     (e) Settlement without Consent if Failure to Reimburse. If at any time an indemnified party
shall have requested an indemnifying party to reimburse the indemnified party for fees and expenses
of counsel, such indemnifying party agrees that it shall be liable for any settlement of the nature
contemplated by Section 6(a)(ii) effected without its written consent if (i) such settlement is
entered into more than 45 days after receipt by such indemnifying party of the aforesaid request,
(ii) such indemnifying party shall have received notice of the terms of such settlement at least 30
days prior to such settlement being entered

23

 

into and (iii) such indemnifying party shall not have reimbursed such indemnified party in
accordance with such request prior to the date of such settlement.

     (f) Other Agreements with Respect to Indemnification. The provisions of this Section 6 shall
not affect any agreement among the Company and the Selling Shareholders with respect to
indemnification.

     SECTION 7. Contribution. If the indemnification provided for in Section 6 hereof is
for any reason unavailable to or insufficient to hold harmless an indemnified party in respect of
any losses, liabilities, claims, damages or expenses referred to therein, then each indemnifying
party shall contribute to the aggregate amount of such losses, liabilities, claims, damages and
expenses incurred by such indemnified party, as incurred, (i) in such proportion as is appropriate
to reflect the relative benefits received by the Company and the Selling Shareholders on the one
hand and the Underwriters on the other hand from the offering of the Securities pursuant to this
Agreement or (ii) if the allocation provided by clause (i) is not permitted by applicable law, in
such proportion as is appropriate to reflect not only the relative benefits referred to in clause
(i) above but also the relative fault of the Company and the Selling Shareholders on the one hand
and of the Underwriters on the other hand in connection with the statements or omissions which
resulted in such losses, liabilities, claims, damages or expenses, as well as any other relevant
equitable considerations.

     The relative benefits received by the Company and the Selling Shareholders on the one hand and
the Underwriters on the other hand in connection with the offering of the Securities pursuant to
this Agreement shall be deemed to be in the same respective proportions as the total net proceeds
from the offering of the Securities pursuant to this Agreement (before deducting expenses) received
by the Company and the Selling Shareholders and the total underwriting discount received by the
Underwriters, in each case as set forth on the cover of the Prospectus, bear to the aggregate
initial public offering price of the Securities as set forth on the cover of the Prospectus.

     The relative fault of the Company and the Selling Shareholders on the one hand and the
Underwriters on the other hand shall be determined by reference to, among other things, whether any
such untrue or alleged untrue statement of a material fact or omission or alleged omission to state
a material fact relates to information supplied by the Company or the Selling Shareholders or by
the Underwriters and the parties’ relative intent, knowledge, access to information and opportunity
to correct or prevent such statement or omission.

     The Company, the Selling Shareholders and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 7 were determined by pro rata allocation (even
if the Underwriters were treated as one entity for such purpose) or by any other method of
allocation which does not take account of the equitable considerations referred to above in this
Section 7. The aggregate amount of losses, liabilities, claims, damages and expenses incurred by
an indemnified party and referred to above in this Section 7 shall be deemed to include any legal
or other expenses reasonably incurred by such indemnified party in investigating, preparing or
defending against any litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever based upon any such untrue or alleged untrue
statement or omission or alleged omission.

     Notwithstanding the provisions of this Section 7, no Underwriter shall be required to
contribute any amount in excess of the amount by which the total price at which the Securities
underwritten by it and distributed to the public were offered to the public exceeds the amount of
any damages which such Underwriter has otherwise been required to pay by reason of any such untrue
or alleged untrue statement or omission or alleged omission.

24

 

     Notwithstanding the provisions of this Section 7, no Selling Shareholder shall be required to
contribute in the aggregate any amount in excess of the amount of the net proceeds received by such
Selling Shareholder for the sale of the Securities sold by such person in the public offering
pursuant to this Agreement.

     No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the
1933 Act) shall be entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation.

     For purposes of this Section 7, each person, if any, who controls an Underwriter within the
meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act and each Underwriter’s
Affiliates and selling agents shall have the same rights to contribution as such Underwriter, and
each director of the Company, each officer of the Company who signed the Registration Statement,
and each person, if any, who controls the Company or any Selling Shareholder within the meaning of
Section 15 of the 1933 Act or Section 20 of the 1934 Act shall have the same rights to contribution
as the Company or such Selling Shareholder, as the case may be. The Underwriters’ respective
obligations to contribute pursuant to this Section 7 are several in proportion to the number of
Initial Securities set forth opposite their respective names in Schedule A hereto and not joint.

     The provisions of this Section 7 shall not affect any agreement among the Company and the
Selling Shareholders with respect to contribution.

     SECTION 8. Representations, Warranties and Agreements to Survive. All
representations, warranties and agreements contained in this Agreement or in certificates of
officers of the Company or any of its subsidiaries or the Selling Shareholders submitted pursuant
hereto, shall remain operative and in full force and effect regardless of (i) any investigation
made by or on behalf of any Underwriter or its Affiliates or selling agents, any person controlling
any Underwriter, its officers or directors or any person controlling the Company or any person
controlling any Selling Shareholder and (ii) delivery of and payment for the Securities.

     SECTION 9. Termination of Agreement.

     (a) Termination; General. The Representative may terminate this Agreement, by notice to the
Company and the Selling Shareholders, at any time at or prior to Closing Time (i) if there has
been, since the time of execution of this Agreement or since the respective dates as of which
information is given in the Prospectus (exclusive of any supplement thereto) or General Disclosure
Package, any material adverse change in the condition, financial or otherwise, or in the earnings,
business affairs or business prospects of the Company and its subsidiaries considered as one
enterprise, whether or not arising in the ordinary course of business, or (ii) if there has
occurred any material adverse change in the financial markets in the United States or the
international financial markets, any outbreak of hostilities or escalation thereof or other
calamity or crisis or any change or development involving a prospective change in national or
international political, financial or economic conditions, in each case the effect of which is such
as to make it, in the judgment of the Representative, impracticable or inadvisable to market the
Securities or to enforce contracts for the sale of the Securities, or (iii) if trading in any
securities of the Company has been suspended or materially limited by the Commission or the NASDAQ
Global Market, or if trading generally on the American Stock Exchange or the New York Stock
Exchange or in the NASDAQ Global Market has been suspended or materially limited, or minimum or
maximum prices for trading have been fixed, or maximum ranges for prices have been required, by any
of said exchanges or by such system or by order of the Commission, the National Association of
Securities Dealers, Inc. or any other governmental authority, or (iv) a material disruption has
occurred in commercial banking or securities settlement or clearance services

25

 

in the United States, or (v) if a banking moratorium has been declared by either Federal or
New York authorities.

     (b) Liabilities. If this Agreement is terminated pursuant to this Section, such termination
shall be without liability of any party to any other party except as provided in Section 4 hereof,
and provided further that Sections 1, 6, 7 and 8 shall survive such termination and remain in full
force and effect.

     SECTION 10. Default by One or More of the Underwriters. If one or more of the
Underwriters shall fail at Closing Time or a Date of Delivery to purchase the Securities which it
or they are obligated to purchase under this Agreement (the “Defaulted Securities”), the
Representative shall have the right, within 24 hours thereafter, to make arrangements for one or
more of the non-defaulting Underwriters, or any other underwriters, to purchase all, but not less
than all, of the Defaulted Securities in such amounts as may be agreed upon and upon the terms
herein set forth; if, however, the Representative shall not have completed such arrangements within
such 24-hour period, then:

     (i) if the number of Defaulted Securities does not exceed 10% of the number of
Securities to be purchased on such date, each of the non-defaulting Underwriters shall be
obligated, severally and not jointly, to purchase the full amount thereof in the proportions
that their respective underwriting obligations hereunder bear to the underwriting
obligations of all non-defaulting Underwriters, or

     (ii) if the number of Defaulted Securities exceeds 10% of the number of Securities to
be purchased on such date, this Agreement or, with respect to any Date of Delivery which
occurs after the Closing Time, the obligation of the Underwriters to purchase and of the
Company to sell the Option Securities to be purchased and sold on such Date of Delivery
shall terminate without liability on the part of any non-defaulting Underwriter.

     No action taken pursuant to this Section 10 shall relieve any defaulting Underwriter from
liability in respect of its default.

     In the event of any such default which does not result in a termination of this Agreement or,
in the case of a Date of Delivery which is after the Closing Time, which does not result in a
termination of the obligation of the Underwriters to purchase and the Company to sell the relevant
Option Securities, as the case may be, either (i) the Representative or (ii) the Company and any
Selling Shareholder, as applicable, shall have the right to postpone Closing Time or the relevant
Date of Delivery, as the case may be, for a period not exceeding seven days in order to effect any
required changes in the Registration Statement or Prospectus or in any other documents or
arrangements. As used herein, the term “Underwriter” includes any person substituted for an
Underwriter under this Section 10.

     SECTION 11. Default by One or More of the Selling Shareholders or the Company. (a)
If a Selling Shareholder shall fail at Closing Time to sell and deliver the number of Securities
which such Selling Shareholder is obligated to sell hereunder, and the remaining Selling
Shareholders do not exercise the right hereby granted to increase, pro rata or otherwise, the
number of Securities to be sold by them hereunder to the total number to be sold by all Selling
Shareholders as set forth in Schedule B hereto, then the Underwriters may, at option of the
Representative, by notice from the Representative to the Company and the non-defaulting Selling
Shareholders, either (i) terminate this Agreement without any liability on the fault of any
non-defaulting party except that the provisions of Sections 1, 4, 6, 7 and 8 shall remain in full
force and effect or (ii) elect to purchase the Securities which the non-defaulting Selling
Shareholders and the Company have agreed to sell hereunder. No action taken pursuant to this
Section 11 shall relieve any Selling Shareholder so defaulting from liability, if any, in respect
of such default.

26

 

     In the event of a default by any Selling Shareholder as referred to in this Section 11, each
of the Representative, the Company and the non-defaulting Selling Shareholders shall
have the right to postpone Closing Time for a period not exceeding seven days in order to effect
any required change in the Registration Statement or Prospectus or in any other documents or
arrangements.

     (b) If the Company shall fail at Closing Time or at the Date of Delivery to sell the number of
Securities that it is obligated to sell hereunder, then this Agreement shall terminate without any
liability on the part of any non-defaulting party; provided, however, that the
provisions of Sections 1, 4, 6, 7 and 8 shall remain in full force and effect. No action taken
pursuant to this Section shall relieve the Company from liability, if any, in respect of such
default.

     SECTION 12. Tax Disclosure. Notwithstanding any other provision of this Agreement,
from the commencement of discussions with respect to the transactions contemplated hereby, the
Company (and each employee, representative or other agent of the Company) may disclose to any and
all persons, without limitation of any kind, the tax treatment and tax structure (as such terms are
used in Sections 6011, 6111 and 6112 of the U.S. Internal Revenue Code and the Treasury Regulations
promulgated thereunder) of the transactions contemplated by this Agreement and all materials of any
kind (including opinions or other tax analyses) that are provided relating to such tax treatment
and tax structure.

     SECTION 13. Notices. All notices and other communications hereunder shall be in
writing and shall be deemed to have been duly given if mailed or transmitted by any standard form
of telecommunication. Notices to the Underwriters shall be directed to the Representative at 4
World Financial Center, New York, New York 10080, attention of Jonathan Roskes; notices to the
Company shall be directed to it at Zoltek Companies, Inc., 3101 McKelvey Road, St. Louis, Missouri
63044, attention of Zsolt Rumy and Kevin Schott; and notices to the Selling Shareholders shall be
directed to c/o Zoltek Companies, Inc., 3101 McKelvey Road, St. Louis, Missouri 63044, attention of
Zsolt Rumy and Kevin Schott.

     SECTION 14. No Advisory or Fiduciary Relationship. Each of the Company and each
Selling Shareholder acknowledges and agrees that (a) the purchase and sale of the Securities
pursuant to this Agreement, including the determination of the public offering price of the
Securities and any related discounts and commissions, is an arm’s-length commercial transaction
between the Company and the Selling Shareholder, on the one hand, and the several Underwriters, on
the other hand, (b) in connection with the offering contemplated hereby and the process leading to
such transaction each Underwriter is and has been acting solely as a principal and is not the agent
or fiduciary of the Company or any Selling Shareholder, or its respective stockholders, creditors,
employees or any other party, (c) no Underwriter has assumed or will assume an advisory or
fiduciary responsibility in favor of the Company or any Selling Shareholder with respect to the
offering contemplated hereby or the process leading thereto (irrespective of whether such
Underwriter has advised or is currently advising the Company or any Selling Shareholder on other
matters) and no Underwriter has any obligation to the Company or any Selling Shareholder with
respect to the offering contemplated hereby except the obligations expressly set forth in this
Agreement, (d) the Underwriters and their respective Affiliates may be engaged in a broad range of
transactions that involve interests that differ from those of each of the Company and each Selling
Shareholder, and (e) the Underwriters have not provided any legal, accounting, regulatory or tax
advice with respect to the offering contemplated hereby and the Company and each of the Selling
Shareholders has consulted its own respective legal, accounting, regulatory and tax advisors to the
extent it deemed appropriate. The Company and the Selling Shareholders hereby waive any claims
that the Company or the Selling Shareholders may have against the Underwriters with respect to any
breach of fiduciary duty in connection with this offering.

     SECTION 15. Research Analyst Independence. Each of the Company and the Selling
Shareholders acknowledges that the Underwriters’ research analysts and research departments are
required

27

 

to be independent from their respective investment banking divisions and are subject to
certain regulations and internal policies, and that such Underwriters’ research analysts may hold
views and make statements or investment recommendations and/or publish research reports with
respect to the Company and/or the offering that differ from the views of their respective
investment banking divisions. The Company and the Selling Shareholders hereby waive and release,
to the fullest extent permitted by law, any claims that the Company or the Selling Shareholders may
have against the Underwriters with respect to any conflict of interest that may arise from the fact
that the views expressed by their independent research analysts and research departments may be
different from or inconsistent with the views or advice communicated to the Company or the Selling
Shareholders by such Underwriters’ investment banking divisions. The Company and the Selling
Shareholders acknowledge that each of the Underwriters is a full-service securities firm and as
such from time to time, subject to applicable securities laws, may effect transactions for its own
account or the account of its customers and hold long or short positions in debt or equity
securities of the Company.

     SECTION 16. Integration. This Agreement supersedes all prior agreements and
understandings (whether written or oral) among the Company, the Selling Shareholders and the
Underwriters, or any of them, with respect to the subject matter hereof.

     SECTION 17. Parties. This Agreement shall each inure to the benefit of and be
binding upon the Underwriters, the Company and the Selling Shareholders and their respective
successors. Nothing expressed or mentioned in this Agreement is intended or shall be construed to
give any person, firm or corporation, other than the Underwriters, the Company and the Selling
Shareholders and their respective successors and the controlling persons and officers and directors
referred to in Sections 6 and 7 and their heirs and legal representatives, any legal or equitable
right, remedy or claim under or in respect of this Agreement or any provision herein contained.
This Agreement and all conditions and provisions hereof are intended to be for the sole and
exclusive benefit of the Underwriters, the Company and the Selling Shareholders and their
respective successors, and said controlling persons and officers and directors and their heirs and
legal representatives, and for the benefit of no other person, firm or corporation. No purchaser
of Securities from any Underwriter shall be deemed to be a successor by reason merely of such
purchase.

     SECTION 18. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

     SECTION 19. TIME. TIME SHALL BE OF THE ESSENCE OF THIS AGREEMENT. EXCEPT AS OTHERWISE
SET FORTH HEREIN, SPECIFIED TIMES OF DAY REFER TO NEW YORK CITY TIME.

     SECTION 20. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such counterparts shall
together constitute one and the same Agreement.

     SECTION 21. Effect of Headings. The Section headings herein are for convenience only
and shall not affect the construction hereof.

[Remainder of page intentionally left blank.]

28

 

If the foregoing is in accordance with your understanding of our agreement, please sign and return
to the Company and the Attorney-in-Fact for the Selling Shareholders a counterpart hereof,
whereupon this instrument, along with all counterparts, will become a binding agreement among the
Underwriters, the Company and the Selling Shareholders in accordance with its terms.

	 	 	 	 	 
	 	Very truly yours,

ZOLTEK COMPANIES, INC.

 	 
	 	By  	/s/ Zsolt Rumy
 	 
	 	 	Title: Chairman and Chief Executive Officer 	 
	 	 	 	 
	 
	 	THE SELLING SHAREHOLDERS

 	 
	 	By  	/s/ Kevin Schott
 	 
	 	 	As Attorney-in-Fact acting on behalf of the 	 
	 	 	Selling Shareholders named in Schedule B
hereto 	 
	 

	 	 	 	 	 
	CONFIRMED AND ACCEPTED,

as of the date first above written:

MERRILL LYNCH & CO.

MERRILL LYNCH, PIERCE, FENNER & SMITH

     INCORPORATED

 	 	 
	By  	/s/ John Fortson
 	 	 
	 	Authorized Signatory 	 	 

     For itself and as Representative of the other Underwriters named in Schedule A hereto.

29

 

SCHEDULE A

	 	 	 	 	 
	 	 	Number of
	 	 	Initial
	Name of Underwriter	 	Securities
	 
	 	 	 	 
	Merrill Lynch, Pierce, Fenner & Smith
Incorporated
	 	 	2,600,000	 
	RBC Capital Markets Corporation
	 	 	1,200,000	 
	ThinkEquity Partners LLC
	 	 	200,000	 
	 
	 	 	 	 
	 
	 	 	 	 
	Total
	 	 	4,000,000	 
	 
	 	 	 	 

Sch A-1

 

SCHEDULE B

	 	 	 	 	 	 	 	 	 
	 	 	Number of Initial	 	Maximum Number of Option
	 	 	Securities to be Sold	 	Securities to Be Sold
	ZOLTEK COMPANIES, INC.
	 	 	3,615,000	 	 	 	600,000	 
	 
	 	 	 	 	 	 	 	 
	1. Management Selling
Shareholders:
	 	 	 	 	 	 	 	 
	Zsolt Rumy
	 	 	250,000	 	 	 	0	 
	 
	 	 	 	 	 	 	 	 
	2. Non-Management Selling
Shareholders:
	 	 	 	 	 	 	 	 
	Linn H. Bealke1
	 	 	75,000	 	 	 	0	 
	James W. Betts
	 	 	15,000	 	 	 	0	 
	Charles A. Dill2
	 	 	45,000	 	 	 	0	 
	 
	 	 	 	 	 	 	 	 
	Total
	 	 	4,000,000	 	 	 	600,000	 
	 
	 	 	 	 	 	 	 	 

 

			
	1	 	Securities are held through the Linn
Hemingway Bealke Revocable Trust UA DTD September 24, 1990.
	 
	2	 	9,698 of the Securities are held through the
Charles A. Dill Revocable Trust and 35,302 of the Securities are held through
the Charles A. Dill IRA.

Sch B-1

 

SCHEDULE C

ZOLTEK COMPANIES, INC.

4,000,000 Shares of Common Stock

(Par Value $0.01 Per Share)

	1.	 	The initial public offering price per share for the Securities
is $38.76.

	2.	 	The number of shares of the Securities purchased by the
Underwriters is 4,000,000 (with overallotment: 4,600,000).
	 
	3.	 	Total Securities offered by the Company: 3,615,000.
	 
	4.	 	Total Securities offered by the Selling Shareholders: 385,000.
	 
	5.	 	Closing Date: August 20, 2007.

Sch C-1

 

SCHEDULE D

ZOLTEK COMPANIES, INC.

4,000,000 Shares of Common Stock

(Par Value $0.01 Per Share)

     1. The initial public offering price per share for the Securities, determined as
provided in said Section 2, shall be $38.76.

     2. The purchase price per share for the Securities to be paid by the several
Underwriters shall be $36.5313, being an amount equal to the initial public offering price
set forth above less $2.2287 per share; provided that the purchase price per share for any
Option Securities purchased upon the exercise of the overallotment option described in
Section 2(b) shall be reduced by an amount per share equal to any dividends or distributions
declared by the Company and payable on the Initial Securities but not payable on the Option
Securities.

Sch D-1

 

SCHEDULE E

LIST OF ISSUER GENERAL USE FREE WRITING PROSPECTUSES

	1.	 	Issuer Free Writing Prospectus filed with the Commission on August 13, 2007.

Sch E-1

 

SCHEDULE F

LIST OF SUBSIDIARIES OF THE COMPANY

Zoltek Corporation

Zoltek Properties, Inc.

Engineering Technology Corporation

Zoltek Zrt.

Zoltek de Mexico SA de CV

Zoltek de Occidente SA de CV

Sch F-1

 

SCHEDULE G

ASSOCIATIONS WITH NASD

     Mr. Charles A. Dill, a Director of the Company and a Selling Shareholder, serves as a Director
of Stifel Financial Corp., the parent of Stifel, Nicolaus & Company, a securities brokerage and
investment banking firm that is a member firm of the National Association of Securities Dealers,
Inc.

Sch G-1

 

SCHEDULE H

PERSONS AND ENTITIES

SUBJECT TO LOCK-UP

Linn H. Bealke

James W. Betts

Charles A. Dill

George E. Husman

Michael D. Latta

Zsolt Rumy

Kevin Schott

Sch H-1

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