DRAFT 10/9/97
________________ Shares
ADVANCED COMMUNICATIONS GROUP, INC.
Common Stock
UNDERWRITING AGREEMENT
___________, 1997
PAINEWEBBER INCORPORATED
XXXXXXXXXXX & CO., INC.
As Representatives of the
several Underwriters
c/o PaineWebber Incorporated
1285 Avenue of the Americas
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Advanced Communications Group, Inc., a Delaware corporation
(the "Company"), proposes to sell an aggregate of _______ shares (the "Firm
Shares") of the Company's Common Stock, $.0001 par value per share (the "Common
Stock"), to you and to the other underwriters named in Schedule I
(collectively, the "Underwriters"), for whom you are acting as representatives
(the "Representatives"). The Company has also agreed to grant to you and the
other Underwriters an option (the "Option") to purchase up to an additional
______ shares of Common Stock (the "Option Shares") on the terms and for the
purposes set forth in Section 1(b). The Firm Shares and the Option Shares are
hereinafter collectively referred to as the "Shares."
The initial public offering price per share for the Shares
and the purchase price per share for the Shares to be paid by the several
Underwriters shall be agreed upon by the Company and the Representatives,
acting on behalf of the several Underwriters, and such agreement shall be set
forth in a separate written instrument substantially in the form of Exhibit A
hereto (the "Price Determination Agreement"). The Price Determination
Agreement may take the form of an exchange of any standard form of written
telecommunication among the Company and the Representatives and shall specify
such applicable information as is indicated in Exhibit A hereto. The offering
of the Shares will be governed by this Agreement, as supplemented by the Price
Determination Agreement. From and after the date of the execution and delivery
of the Price Determination Agreement, this Agreement shall be deemed to
incorporate, and, unless the context otherwise indicates, all references
contained herein to "this Agreement" and to the phrase "herein" shall be deemed
to include the Price Determination Agreement.
The Company confirms as follows its agreements with the
Representatives and the several other Underwriters.
1. Agreement to Sell and Purchase.
(a) On the basis of the representations,
warranties and agreements of the Company herein contained and subject to all
the terms and conditions of this Agreement, the Company agrees to sell to each
Underwriter named below, and each Underwriter, severally and not jointly,
agrees to purchase from the Company at the purchase price per share for the
Firm Shares to be agreed upon by the Representatives and the Company in
accordance with Section 1(c) or 1(d) hereof and set forth in the Price
Determination Agreement, the number of Firm Shares set forth opposite the name
of such Underwriter in Schedule I, plus such additional number of Firm Shares
which such Underwriter may become obligated to purchase pursuant to Section 8
hereof. Schedule I may be attached to the Price Determination Agreement.
(b) Subject to all the terms and conditions of
this Agreement, the Company grants the Option to the several Underwriters to
purchase, severally and not jointly, up to ___ Option Shares from the Company
at the same price per share as the Underwriters shall pay for the Firm Shares.
The Option may be exercised only to cover over-allotments in the sale of the
Firm Shares by the Underwriters and may be exercised in whole or in part at any
time (but not more than once) on or before the 45th day after the date of this
Agreement (or, if the Company has elected to rely on Rule 430A, on or before
the 45th day after the date of the Price Determination Agreement), upon written
or telegraphic notice (the "Option Shares Notice") by the Representatives to
the Company no later than 12:00 noon, New York City time, at least two and no
more than five business days before the date specified for closing in the
Option Shares Notice (the "Option Closing Date") setting forth the aggregate
number of Option Shares to be purchased and the time and date for such
purchase. On the Option Closing Date, the Company will issue and sell to the
Underwriters the number of Option Shares set forth in the Option Shares Notice,
and each Underwriter will purchase such percentage of the Option Shares as is
equal to the percentage of Firm Shares that such Underwriter is purchasing, as
adjusted by the Representatives in such manner as they deem advisable to avoid
fractional shares.
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(c) The initial public offering price per share
for the Firm Shares and the purchase price per share for the Firm Shares to be
paid by the several Underwriters shall be agreed upon and set forth in the
Price Determination Agreement, if the Company has elected to rely on Rule 430A.
In the event such price has not been agreed upon and the Price Determination
Agreement has not been executed by the close of business on the fourteenth
business day following the date on which the Registration Statement (as
hereinafter defined) becomes effective, this Agreement shall terminate
forthwith, without liability of any party to any other party except that
Section 6 shall remain in effect.
(d) If the Company has elected not to rely on
Rule 430A, the initial public offering price per share for the Firm Shares and
the purchase price per share for the Firm Shares to be paid by the several
Underwriters shall be agreed upon and set forth in the Price Determination
Agreement, which shall be dated the date hereof, and an amendment to the
Registration Statement containing such per share price information shall be
filed before the Registration Statement becomes effective.
2. Delivery and Payment. Delivery of the Firm Shares
shall be made to the Representatives [for the accounts of the Underwriters at
the office of PaineWebber Incorporated, 0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx,
Xxx Xxxx 00000], against payment of the purchase price by [Federal Reserve
Funds check payable in immediately available funds to the order of the Company]
[by wire transfer of Federal Funds or similar same day funds to an account
designated in writing by the Company to PaineWebber Incorporated at least one
business day prior to the Closing Date (as hereinafter defined)]. Such payment
shall be made at 10:00 a.m., New York City time, on the third business day (or
fourth business day, if the Price Determination Agreement is executed after
4:30 p.m.) after the date on which the first bona fide offering of the Shares
to the public is made by the Underwriters or at such time on such other date,
not later than ten business days after such date, as may be agreed upon by the
Company and the Representatives (such date is hereinafter referred to as the
"Closing Date").
To the extent the Option is exercised, delivery of the Option
Shares against payment by the Underwriters (in the manner specified above) will
take place at the offices specified above for the Closing Date at the time and
date (which may be the Closing Date) specified in the Option Shares Notice.
[Certificates evidencing the Shares shall be in definitive
form and shall be registered in such names and in such denominations as the
Representatives shall request at least two business days prior to the Closing
Date or the Option Closing Date, as the case may be, by written notice to the
Company. For the purpose of expediting the checking and packaging of
certificates for the Shares, the Company agrees to make such certificates
available for inspection at least 24 hours prior to the Closing Date or the
Option Closing Date, as the case may be.]
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The cost of original issue tax stamps, if any, in connection
with the issuance and delivery of the Firm Shares and Option Shares by the
Company to the respective Underwriters shall be borne by the Company. The
Company will pay and save each Underwriter and any subsequent holder of the
Shares harmless from any and all liabilities with respect to or resulting from
any failure or delay in paying Federal and state stamp and other transfer
taxes, if any, which may be payable or determined to be payable in connection
with the original issuance or sale to such Underwriter of the Firm Shares and
Option Shares.
3. Representations and Warranties of the Company. The
Company represents, warrants and covenants to each Underwriter that:
(a) A registration statement (Registration No. ) on
Form S-1 relating to the Shares, including a preliminary prospectus and such
amendments to such registration statement as may have been required to the date
of this Agreement, has been prepared by the Company under the provisions of the
Securities Act of 1933, as amended (the "Act"), and the rules and regulations
(collectively referred to as the "Rules and Regulations") of the Securities and
Exchange Commission (the "Commission") thereunder, and has been filed with the
Commission. The term "preliminary prospectus" as used herein means a
preliminary prospectus as contemplated by Rule 430 or Rule 430A ("Rule 430A")
of the Rules and Regulations included at any time as part of the registration
statement. Copies of such registration statement and amendments and of each
related preliminary prospectus have been delivered to the Representatives. The
term "Registration Statement" means the registration statement as amended at
the time it becomes or became effective (the "Effective Date"), including
financial statements and all exhibits and any information deemed to be included
by Rule 430A or Rule 434 of the Rules and Regulations. If the Company files a
registration statement to register a portion of the Shares and relies on Rule
462(b) of the Rules and Regulations for such registration statement to become
effective upon filing with the Commission (the "Rule 462 Registration
Statement"), then any reference to the "Registration Statement" shall be deemed
to include the Rule 462 Registration Statement, as amended from time to time.
The term "Prospectus" means the prospectus as first filed with the Commission
pursuant to Rule 424(b) of the Rules and Regulations or, if no such filing is
required, the form of final prospectus included in the Registration Statement
at the Effective Date.
(b) On the Effective Date, the date the Prospectus
is first filed with the Commission pursuant to Rule 424(b) (if required), at
all times subsequent to and including the Closing Date and, if later, the
Option Closing Date and when any post-effective amendment to the Registration
Statement becomes effective or any amendment or supplement to the Prospectus is
filed with the Commission, the Registration Statement and the Prospectus (as
amended or as supplemented if the Company shall have filed with the Commission
any amendment or supplement thereto), including the financial statements
included in the Prospectus, did or will comply with all applicable provisions
of the Act and
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the Rules and Regulations and will contain all statements required to be stated
therein in accordance with the Act and the Rules and Regulations. On the
Effective Date and when any post-effective amendment to the Registration
Statement becomes effective, no part of the Registration Statement or any such
amendment did or will contain any untrue statement of a material fact or omit
to state a material fact required to be stated therein or necessary in order to
make the statements therein not misleading. At the Effective Date, the date the
Prospectus or any amendment or supplement to the Prospectus is filed with the
Commission and at the Closing Date and, if later, the Option Closing Date, the
Prospectus did not or will not contain any untrue statement of a material fact
or omit to state a material fact necessary to make the statements therein, in
the light of the circumstances under which they were made, not misleading. The
foregoing representations and warranties in this Section 3(b) do not apply to
any statements or omissions made in reliance on and in conformity with
information relating to any Underwriter furnished in writing to the Company by
the Representatives specifically for inclusion in the Registration Statement or
Prospectus or any amendment or supplement thereto. For all purposes of this
Agreement, the amounts of the selling concession and reallowance set forth in
the Prospectus constitute the only information relating to any Underwriter
furnished in writing to the Company by the Representatives specifically for
inclusion in the Registration Statement, the preliminary prospectus or the
Prospectus. The Company has not distributed any offering material in connection
with the offering or sale of the Shares other than the Registration Statement,
the preliminary prospectus, the Prospectus or any other materials, if any,
permitted by the Act.
(c) The only subsidiaries (as defined in the Rules
and Regulations) of the Company are the subsidiaries listed on Exhibit 21 to
the Registration Statement (the "Subsidiaries"). The Company and each of its
Subsidiaries is, and at the Closing Date will be, a corporation duly organized,
validly existing and in good standing under the laws of its jurisdiction of
incorporation. The Company and each of its Subsidiaries has, and at the Closing
Date will have, full power and authority to conduct all the activities
conducted by it, to own or lease all the assets owned or leased by it and to
conduct its business as described in the Registration Statement and the
Prospectus. The Company and each of its Subsidiaries is, and at the Closing
Date will be, duly licensed or qualified to do business and in good standing as
a foreign corporation in all jurisdictions in which the nature of the
activities conducted by it or the character of the assets owned or leased by it
makes such licensing or qualification necessary. All of the outstanding shares
of capital stock of the Subsidiaries have been duly authorized and validly
issued and are fully paid and non-assessable and are owned by the Company free
and clear of all liens, encumbrances and claims whatsoever. Except for the
stock of the Subsidiaries and as disclosed in the Registration Statement, the
Company does not own, and at the Closing Date will not own, directly or
indirectly, any shares of stock or any other equity or long-term debt
securities of any corporation or have any equity interest in any firm,
partnership, joint venture, association or other entity. Complete and correct
copies of the certificate of incorporation and of the by-laws of the Company
and each of its Subsidiaries and all amendments thereto have been delivered to
the Representatives, and no changes therein
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will be made subsequent to the date hereof and prior to the Closing Date or, if
later, the Option Closing Date.
(d) The outstanding shares of Common Stock have
been, and the Shares to be issued and sold by the Company upon such issuance
will be, duly authorized, validly issued, fully paid and nonassessable and will
not be subject to any preemptive or similar right. The description of the
Common Stock in the Registration Statement and the Prospectus is, and at the
Closing Date will be, complete and accurate in all respects. Except as set
forth in the Prospectus, the Company does not have outstanding, and at the
Closing Date will not have outstanding, any options to purchase, or any rights
or warrants to subscribe for, or any securities or obligations convertible
into, or any contracts or commitments to issue or sell, any shares of Common
Stock, any shares of capital stock of any Subsidiary or any such warrants,
convertible securities or obligations.
(e) The financial statements and schedules included
in the Registration Statement or the Prospectus present fairly the consolidated
financial condition of the Company as of the respective dates thereof and the
consolidated results of operations and cash flows of the Company for the
respective periods covered thereby, all in conformity with generally accepted
accounting principles applied on a consistent basis throughout the entire
period involved, except as otherwise disclosed in the Prospectus. The pro forma
financial statements and other pro forma financial information included in the
Registration Statement or the Prospectus (i) present fairly in all material
respects the information shown therein, (ii) have been prepared in accordance
with the Commission's rules and guidelines with respect to pro forma financial
statements and (iii) have been properly computed on the bases described
therein. The assumptions used in the preparation of the pro forma financial
statements and other pro forma financial information included in the
Registration Statement or the Prospectus are reasonable and the adjustments
used therein are appropriate to give effect to the transactions or
circumstances referred to therein. No other financial statements or schedules
of the Company are required by the Act or the Rules and Regulations to be
included in the Registration Statement or the Prospectus. KPMG Peat Marwick
LLP, Xxxxxxx Xxxxxxxxx P.L.L.C., Xxxx & Associates LLP, Xxxxxxx Xxxxxx &
Company P.L.L.P., Xxxxxxx and Xxx, LLC and Xxxxxxx Xxxxxxxxx & Co. (the
"Accountants") who have reported on such financial statements and schedules,
are independent accountants with respect to the Company as required by the Act
and the Rules and Regulations. The statements included in the Registration
Statement with respect to the Accountants pursuant to Rule 509 of Regulation
S-K of the Rules and Regulations are true and correct in all material respects.
(f) The Company maintains a system of internal
accountings control sufficient to provide reasonable assurance that (i)
transactions are executed in accordance with management's general or specific
authorization; (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally accepted
accounting principles and to maintain accountability for assets;
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(iii) access to assets is permitted only in accordance with management's
general or specific authorization; and (iv) the recorded accountability for
assets is compared with existing assets at reasonable intervals and appropriate
action is taken with respect to any differences.
(g) Subsequent to the respective dates as of which
information is given in the Registration Statement and the Prospectus and prior
to the Closing Date, except as set forth in or contemplated by the Registration
Statement and the Prospectus, (i) there has not been and will not have been any
change in the capitalization of the Company, or in the business, properties,
business prospects, condition (financial or otherwise) or results of operations
of the Company and its Subsidiaries, arising for any reason whatsoever, (ii)
neither the Company nor any of its Subsidiaries has incurred nor will it incur
any material liabilities or obligations, direct or contingent, nor has it
entered into nor will it enter into any material transactions other than
pursuant to this Agreement and the transactions referred to herein and (iii)
the Company has not and will not have paid or declared any dividends or other
distributions of any kind on any class of its capital stock.
(h) The Company is not an "investment company" or an
"affiliated person" of, or "promoter" or "principal underwriter" for, an
"investment company," as such terms are defined in the Investment Company Act
of 1940, as amended.
(i) Except as set forth in the Registration
Statement and the Prospectus, there are no actions, suits or proceedings
pending or threatened against or affecting the Company or any of its
Subsidiaries or any of their respective officers in their capacity as such,
before or by any Federal or state court, commission, regulatory body,
administrative agency or other governmental body, domestic or foreign, wherein
an unfavorable ruling, decision or finding might materially and adversely
affect the Company or any of its Subsidiaries or its business, properties,
business prospects, condition (financial or otherwise) or results of
operations.
(j) The Company and each of its Subsidiaries has,
and at the Closing Date will have, (i) all governmental licenses, permits,
consents, orders, approvals and other authorizations necessary to carry on its
business as contemplated in the Prospectus, (ii) complied in all respects with
all laws, regulations and orders applicable to it or its business and (iii)
performed all its obligations required to be performed by it, and is not, and
at the Closing Date will not be, in default, under any indenture, mortgage,
deed of trust, voting trust agreement, loan agreement, bond, debenture, note
agreement, lease, contract or other agreement or instrument (collectively, a
"contract or other agreement") to which it is a party or by which its property
is bound or affected. To the best knowledge of the Company and each of its
Subsidiaries, no other party under any contract or other agreement to which it
is a party is in default in any respect thereunder. Neither the Company nor any
of its Subsidiaries is, nor at the Closing Date will any of them be, in
violation of any provision of its certificate of incorporation or by-laws.
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(k) No consent, approval, authorization or order of,
or any filing or declaration with, any court or governmental agency or body is
required in connection with the authorization, issuance, transfer, sale or
delivery of the Shares by the Company, in connection with the execution,
delivery and performance of this Agreement by the Company or in connection with
the taking by the Company of any action contemplated hereby, except such as
have been obtained under the Act or the Rules and Regulations and such as may
be required under state securities or Blue Sky laws or the by-laws and rules of
the National Association of Securities Dealers, Inc. (the "NASD") in connection
with the purchase and distribution by the Underwriters of the Shares.
(l) The Company has full corporate power and
authority to enter into this Agreement. This Agreement has been duly
authorized, executed and delivered by the Company and constitutes a valid and
binding agreement of the Company and is enforceable against the Company in
accordance with the terms hereof. The performance of this Agreement and the
consummation of the transactions contemplated hereby and the application of the
net proceeds from the offering and sale of the Shares in the manner set forth
in the Prospectus under "Use of Proceeds" will not result in the creation or
imposition of any lien, charge or encumbrance upon any of the assets of the
Company or any of its Subsidiaries pursuant to the terms or provisions of, or
result in a breach or violation of any of the terms or provisions of, or
constitute a default under, or give any other party a right to terminate any of
its obligations under, or result in the acceleration of any obligation under,
the certificate of incorporation or by-laws of the Company or any of its
Subsidiaries, any contract or other agreement to which the Company or any of
its Subsidiaries is a party or by which the Company or any of its Subsidiaries
or any of its properties is bound or affected, or violate or conflict with any
judgment, ruling, decree, order, statute, rule or regulation of any court or
other governmental agency or body applicable to the business or properties of
the Company or any of its Subsidiaries.
(m) The Company and each of its Subsidiaries has
good and marketable title to all properties and assets described in the
Prospectus as owned by it, free and clear of all liens, charges, encumbrances
or restrictions, except such as are described in the Prospectus or are not
material to the business of the Company or its Subsidiaries. The Company and
each of its Subsidiaries has valid, subsisting and enforceable leases for the
properties described in the Prospectus as leased by it, with such exceptions as
are not material and do not materially interfere with the use made and proposed
to be made of such properties by the Company and such Subsidiaries.
(n) The Company and its Subsidiaries (i) are in
compliance with any and all applicable federal, state and local laws and
regulations relating to telecommunications ("Telecommunications Laws"), (ii)
have received all permits, licenses or other approvals required of them under
applicable Telecommunications Laws to conduct their respective businesses and
(iii) are in compliance with all terms and conditions of any such permit,
license or approval.
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(o) There is no document or contract of a character
required to be described in the Registration Statement or the Prospectus or to
be filed as an exhibit to the Registration Statement which is not described or
filed as required. All such contracts to which the Company or any Subsidiary is
a party have been duly authorized, executed and delivered by the Company or
such Subsidiary, constitute valid and binding agreements of the Company or such
Subsidiary and are enforceable against the Company or such Subsidiary in
accordance with the terms thereof.
(p) No statement, representation, warranty or
covenant made by the Company in this Agreement or made in any certificate or
document required by this Agreement to be delivered to the Representatives was
or will be, when made, inaccurate, untrue or incorrect.
(q) Neither the Company nor any of its directors,
officers or controlling persons has taken, directly or indirectly, any action
intended, or which might reasonably be expected, to cause or result, under the
Act or otherwise, in, or which has constituted, stabilization or manipulation
of the price of any security of the Company to facilitate the sale or resale of
the Shares.
(r) No holder of securities of the Company has
rights to the registration of any securities of the Company because of the
filing of the Registration Statement.
(s) Prior to the Closing Date, the Shares will be
duly authorized for listing by the New York Stock Exchange upon official notice
of issuance.
(t) The Company and its Subsidiaries are in
compliance with all federal, state and local employment and labor laws,
including, but not limited to, laws relating to non-discrimination in hiring,
promotion and pay of employees; no labor dispute with the employees of the
Company or any Subsidiary exists or, to the knowledge of the Company, is
imminent or threatened; and the Company is not aware of any existing, imminent
or threatened labor disturbance by the employees of any of its principal
suppliers, manufacturers or contractors that could result in a material adverse
effect on the condition (financial or otherwise) or on the earnings, business,
properties, business prospects or operations of the Company and its
Subsidiaries, taken as a whole.
(u) The Company and its Subsidiaries own, or are
licensed or otherwise have the full exclusive right to use, the material
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, services marks
and trade names (collectively, "patent and proprietary rights") presently
employed by them or which are necessary in connection with the conduct of the
business now operated by them, and neither the Company nor any of its
Subsidiaries has received
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any written notice or otherwise has actual knowledge of any infringement of or
conflict with asserted rights of others or any other claims with respect to any
patent or proprietary rights, or of any basis for rendering any patent and
proprietary rights invalid or inadequate to protect the interest of the Company
or any of its Subsidiaries.
(v) Neither the Company nor any of its Subsidiaries
nor, to the Company's knowledge, any employee or agent of the Company or any
Subsidiary has made any payment of funds of the Company or any Subsidiary or
received or retained any funds in violation of any law, rule or regulation or
of a character required to be disclosed in the Prospectus.
(w) The Company has complied, and until the
completion of the distribution of the Shares will comply, with all of the
provisions of (including, without limitation, filing all forms required by)
Section 517.075 of the Florida Securities and Investor Protection Act and
Regulation 3E-900.001 issued thereunder with respect to the offering and sale
of the Shares.
(x) The Company and its Subsidiaries (i) are in
compliance with any and all applicable foreign, federal, state and local laws
and regulations relating to the protection of human health and safety, the
environment or imposing liability or standards of conduct concerning any
Hazardous Material (as hereinafter defined) ("Environmental Laws"), (ii) have
received all permits, licenses or other approvals required of them under
applicable Environmental Laws to conduct their respective businesses and (iii)
are in compliance with all terms and conditions of any such permit, license or
approval, except where such noncompliance with Environmental Laws, failure to
receive required permits, licenses or other approvals or failure to comply with
the terms and conditions of such permits, licenses or approvals would not,
individually or in the aggregate result in a material adverse effect on the
condition (financial or otherwise) or on the earnings, business, properties,
business prospects or operations of the Company and its Subsidiaries, taken as
a whole. The term "Hazardous Material" means (A) any "hazardous substance" as
defined by the Comprehensive Environmental Response, Compensation and Liability
Act of 1980, as amended, (B) any "hazardous waste" as defined by the Resource
Conservation and Recovery Act, as amended, (C) any petroleum or petroleum
product, (D) any polychlorinated biphenyl and (E) any pollutant or contaminant
or hazardous, dangerous, or toxic chemical, material, waste or substance
regulated under or within the meaning of any other Environmental Law.
(y) In the ordinary course of its business, the
Company conducts a periodic review of the effect of Environmental Laws on the
business, operations and properties of the Company and its Subsidiaries, in the
course of which it identifies and evaluates associated costs and liabilities
(including, without limitation, any capital or operating expenditures required
for clean-up, closure of properties or compliance with Environmental Laws or
any permit, license or approval, any related constraints on
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operating activities and any potential liabilities to third parties). Except as
set forth in the Registration Statement and the Prospectus there are no costs
and liabilities associated with or arising in connection with Environmental
Laws as currently in effect (including, without limitation, costs of compliance
therewith) which would, singly or in the aggregate have a material adverse
effect on the condition (financial or otherwise) or on the earnings, business,
properties, business prospects or operations of the Company and its
Subsidiaries, taken as a whole.
(z) The Company maintains insurance with respect to
its properties and business of the types and in amounts generally deemed
adequate for its business and consistent with insurance coverage maintained by
similar companies and businesses, all of which insurance is in full force and
effect.
(aa) The Company has filed all material federal,
state and foreign income and franchise tax returns and has paid all taxes shown
as due thereon, other than taxes which are being contested in good faith and
for which adequate reserves have been established in accordance with generally
accepted accounting principles ("GAAP"); and the Company has no knowledge of
any tax deficiency which has been or might be asserted or threatened against
the Company. There are no tax returns of the Company or any of its Subsidiaries
that are currently being audited by state, local or federal taxing authorities
or agencies (and with respect to which the Company or any Subsidiary has
received notice), where the findings of such audit, if adversely determined,
would result in a material adverse effect on the condition (financial or
otherwise) or on the earnings, business, properties, business prospects or
operations of the Company and its Subsidiaries, taken as a whole.
(bb) With respect to each employee benefit plan,
program and arrangement (including, without limitation, any "employee benefit
plan" as defined in Section 3(3) of the Employee Retirement Income Security Act
of 1974, as amended ("ERISA")) maintained or contributed to by the Company, or
with respect to which the Company could incur any liability under ERISA
(collectively, the "Benefit Plans"), no event has occurred and, to the best
knowledge of the Company, there exists no condition or set of circumstances, in
connection with which the Company could be subject to any liability under the
terms of such Benefit Plan, applicable law (including, without limitation,
ERISA and the Internal Revenue Code of 1986, as amended) or any applicable
agreement that could materially adversely affect the business, properties,
business prospects, condition (financial or otherwise) or results of operations
of the Company and its Subsidiaries, taken as a whole.
4. Agreements of the Company. The Company agrees with
the several Underwriters as follows:
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(a) The Company will not, either prior to the
Effective Date or thereafter during such period as the Prospectus is required
by law to be delivered in connection with sales of the Shares by an Underwriter
or dealer, file any amendment or supplement to the Registration Statement or
the Prospectus, unless a copy thereof shall first have been submitted to the
Representatives within a reasonable period of time prior to the filing thereof
and the Representatives shall not have objected thereto in good faith.
(b) The Company will use its best efforts to cause
the Registration Statement to become effective, and will notify the
Representatives promptly, and will confirm such advice in writing, (1) when the
Registration Statement has become effective and when any post-effective
amendment thereto becomes effective, (2) of any request by the Commission for
amendments or supplements to the Registration Statement or the Prospectus or
for additional information, (3) of the issuance by the Commission of any stop
order suspending the effectiveness of the Registration Statement or the
initiation of any proceedings for that purpose or the threat thereof, (4) of
the happening of any event during the period mentioned in the second sentence
of Section 4(e) that in the judgment of the Company makes any statement made in
the Registration Statement or the Prospectus untrue or that requires the making
of any changes in the Registration Statement or the Prospectus in order to make
the statements therein, in light of the circumstances in which they are made,
not misleading and (5) of receipt by the Company or any representative or
attorney of the Company of any other communication from the Commission relating
to the Company, the Registration Statement, any preliminary prospectus or the
Prospectus. If at any time the Commission shall issue any order suspending the
effectiveness of the Registration Statement, the Company will make every
reasonable effort to obtain the withdrawal of such order at the earliest
possible moment. The Company will use its best efforts to comply with the
provisions of and make all requisite filings with the Commission pursuant to
Rule 430A and to notify the Representatives promptly of all such filings.
(c) The Company will furnish to the Representatives,
without charge, two signed copies of the Registration Statement and of any
post-effective amendment thereto, including financial statements and schedules,
and all exhibits thereto and will furnish to the Representatives, without
charge, for transmittal to each of the other Underwriters, a copy of the
Registration Statement and any post-effective amendment thereto, including
financial statements and schedules but without exhibits.
(d) The Company will comply with all the provisions
of any undertakings contained in the Registration Statement.
(e) On the Effective Date, and thereafter from time
to time, the Company will deliver to each of the Underwriters, without charge,
as many copies of the Prospectus or any amendment or supplement thereto as the
Representatives may reasonably request. The Company consents to the use of the
Prospectus or any amendment or supplement thereto by the several Underwriters
and by all dealers to whom the Shares may
12
be sold, both in connection with the offering or sale of the Shares and for any
period of time thereafter during which the Prospectus is required by law to be
delivered in connection therewith. If during such period of time any event
shall occur which in the judgment of the Company or counsel to the Underwriters
should be set forth in the Prospectus in order to make any statement therein,
in the light of the circumstances under which it was made, not misleading, or
if it is necessary to supplement or amend the Prospectus to comply with law,
the Company will forthwith prepare and duly file with the Commission an
appropriate supplement or amendment thereto, and will deliver to each of the
Underwriters, without charge, such number of copies thereof as the
Representatives may reasonably request.
(f) Prior to any public offering of the Shares by
the Underwriters, the Company will cooperate with the Representatives and
counsel to the Underwriters in connection with the registration or
qualification of the Shares for offer and sale under the securities or Blue Sky
laws of such jurisdictions as the Representatives may request; provided, that
in no event shall the Company be obligated to qualify to do business in any
jurisdiction where it is not now so qualified or to take any action which would
subject it to general service of process in any jurisdiction where it is not
now so subject.
(g) During the period of five years commencing on
the Effective Date, the Company will furnish to the Representatives and each
other Underwriter who may so request copies of such financial statements and
other periodic and special reports as the Company may from time to time
distribute generally to the holders of any class of its capital stock, and will
furnish to the Representatives and each other Underwriter who may so request a
copy of each annual or other report it shall be required to file with the
Commission.
(h) The Company will make generally available to
holders of its securities as soon as may be practicable but in no event later
than the last day of the fifteenth full calendar month following the calendar
quarter in which the Effective Date falls, an earnings statement (which need
not be audited but shall be in reasonable detail) for a period of 12 months
ended commencing after the Effective Date, and satisfying the provisions of
Section 11(a) of the Act (including Rule 158 of the Rules and Regulations).
(i) Whether or not the transactions contemplated by
this Agreement are consummated or this Agreement is terminated, the Company
will pay, or reimburse if paid by the Representatives, all costs and expenses
incident to the performance of the obligations of the Company under this
Agreement, including but not limited to costs and expenses of or relating to
(1) the preparation, printing and filing of the Registration Statement and
exhibits to it, each preliminary prospectus, the Prospectus and any amendment
or supplement to the Registration Statement or the Prospectus, (2) the
preparation and delivery of certificates representing the Shares, (3) the word
processing, printing and reproduction of this Agreement, the Agreement Among
Underwriters, any
13
Dealer Agreements and any Underwriters' Questionnaire, (4) furnishing
(including costs of shipping, mailing and courier) such copies of the
Registration Statement, the Prospectus and any preliminary prospectus, and all
amendments and supplements thereto, as may be requested for use in connection
with the offering and sale of the Shares by the Underwriters or by dealers to
whom Shares may be sold, (5) the listing of the Shares on the New York Stock
Exchange, (6) any filings required to be made by the Underwriters with the
NASD, and the fees, disbursements and other charges of counsel for the
Underwriters in connection therewith, (7) the registration or qualification of
the Shares for offer and sale under the securities or Blue Sky laws of such
jurisdictions designated pursuant to Section 4(f), including the fees,
disbursements and other charges of counsel to the Underwriters in connection
therewith, and the preparation and printing of preliminary, supplemental and
final Blue Sky memoranda, (8) counsel to the Company, (9) the transfer agent
for the Shares and (10) the Accountants.
(j) If this Agreement shall be terminated by the
Company pursuant to any of the provisions hereof (otherwise than pursuant to
Section 8) or if for any reason the Company shall be unable to perform its
obligations hereunder, the Company will reimburse the several Underwriters for
all out-of-pocket expenses (including the fees, disbursements and other charges
of counsel to the Underwriters) reasonably incurred by them in connection
herewith.
(k) The Company will not at any time, directly or
indirectly, take any action intended, or which might reasonably be expected, to
cause or result in, or which will constitute, stabilization of the price of the
shares of Common Stock to facilitate the sale or resale of any of the Shares.
(l) The Company will apply the net proceeds from the
offering and sale of the Shares to be sold by the Company in the manner set
forth in the Prospectus under "Use of Proceeds" and shall file such reports
with the Commission with respect to the sale of the Shares and the application
of the proceeds therefrom as may be required in accordance with Rule 463 under
the Act.
(m) Except as provided in this Agreement, during the
period of 180 days commencing at the Closing Date, the Company will not,
without the prior written consent of PaineWebber Incorporated, directly or
indirectly, sell, offer to sell, grant any option for the sale of, or otherwise
dispose of or file any shelf registration statement or any registration other
than the Registration Statement with the Commission for any Common Stock or
securities convertible into or exercisable or exchangeable for Common Stock,
other than to the Underwriters pursuant to this Agreement and other than
pursuant to employee benefit plans, provided, that the Company will not grant
options to purchase shares of Common Stock pursuant to such employee benefit
plans at a price less than the initial public offering price, except that the
Company may (i) issue on the Closing Date the shares of Common Stock to be
issued in connection with the acquisitions to be
14
consummated on the Closing Date, as described in the Registration Statement, so
long as the purchasers of such shares agree to be bound by a lock-up agreement
with the Representatives in the form set forth in Exhibit B to the effect that
they will not, for a period of 365 days after the commencement of the public
offering of the Shares ("Lock-Up Period"), without written consent of
PaineWebber Incorporated, sell, contract to sell or otherwise dispose of any of
such shares at any time before the expiration of the Lock-Up Period and the
certificates evidencing such shares bear a legend to such effect, [(ii) issue
up to _____ shares of Common Stock ("Acquisition Shares") during the Lock-Up
Period in connection with additional acquisitions so long as the purchasers of
such Acquisition Shares agree to be bound by the lock-up agreement with the
Representatives in the form set forth in Exhibit B to the effect that they will
not, without written consent of PaineWebber Incorporated, sell, contract to
sell or otherwise dispose of any of such shares at any time before the
expiration of the Lock-Up Period and the certificates evidencing such
Acquisition Shares bear a legend to such effect, [(iii) issue shares of Common
Stock during the LockUp Period pursuant to the (x) conversion of the Company's
convertible notes ("Convertible Notes"), and (y) exercise of warrants
("Warrants") issued by the Company as described in the Registration Statement,
so long as the holders of the Convertible Notes and Warrants agree to be bound
by the lock-up agreement with the Representatives in the form set forth in
Exhibit B to the effect that they will not without written consent of
PaineWebber Incorporated, sell, contract to sell or otherwise dispose of any of
such shares at any time before the expiration of the Lock-Up Period and the
certificates evidencing such shares bear a legend to such effect, and (iv)
grant awards and permit the exercise of awards granted pursuant to the
Company's 1997 Stock Awards Plan.
(n) The Company will cause each of its executive
officers, directors and each beneficial owner of more than 5% of the
outstanding shares of Common Stock and each beneficial owner of Convertible
Notes, Warrants and Acquisition Shares to enter into agreements with the
Representatives in the form set forth in Exhibit B to the effect that they will
not, for a period of 365 days after the commencement of the public offering of
the Shares, without the prior written consent of PaineWebber Incorporated,
sell, contract to sell or otherwise dispose of any of such Shares, Convertible
Notes, Warrants and Acquisition Shares (other than pursuant to employee stock
option plans or in connection with other employee incentive compensation
arrangements).
(o) The Company will cause Xxx X. Xxxxxxxxx, the
Chairman of the Board of Directors and Chief Executive Officer of the Company
to enter into an agreement with the Representatives in the form set forth in
Exhibit C to the effect that he will not, for a period ending on March 31,
1999, without the prior written consent of PaineWebber Incorporated, sell,
contract to sell or otherwise dispose of any shares of Common Stock held by
him.
15
5. Conditions of the Obligations of the Underwriters.
In addition to the execution and delivery of the Price Determination Agreement,
the obligations of each Underwriter hereunder are subject to the following
conditions:
(a) Notification that the Registration Statement has
become effective shall be received by the Representatives not later than 5:00
p.m., New York City time, on the date of this Agreement or at such later date
and time as shall be consented to in writing by the Representatives and all
filings required by Rule 424 of the Rules and Regulations and Rule 430A shall
have been made.
(b) (i) No stop order suspending the effectiveness
of the Registration Statement shall have been issued and no proceedings for
that purpose shall be pending or threatened by the Commission, (ii) no order
suspending the effectiveness of the Registration Statement or the qualification
or registration of the Shares under the securities or Blue Sky laws of any
jurisdiction shall be in effect and no proceeding for such purpose shall be
pending before or threatened or contemplated by the Commission or the
authorities of any such jurisdiction, (iii) any request for additional
information on the part of the staff of the Commission or any such authorities
shall have been complied with to the satisfaction of the staff of the
Commission or such authorities and (iv) after the date hereof no amendment or
supplement to the Registration Statement or the Prospectus shall have been
filed unless a copy thereof was first submitted to the Representatives and the
Representatives did not object thereto in good faith, and the Representatives
shall have received certificates, dated the Closing Date and the Option Closing
Date and signed by the Chief Executive Officer or the Chairman of the Board of
Directors of the Company and the Chief Financial Officer of the Company (who
may, as to proceedings threatened, rely upon the best of their information and
belief), to the effect of clauses (i), (ii) and (iii).
(c) Since the respective dates as of which
information is given in the Registration Statement and the Prospectus, (i)
there shall not have been, and no development shall have occurred which could
reasonably be expected to result in, a material adverse change in the general
affairs, business, business prospects, properties, management, condition
(financial or otherwise) or results of operations of the Company and its
Subsidiaries, taken as a whole, whether or not arising from transactions in the
ordinary course of business, in each case other than as set forth in or
contemplated by the Registration Statement and the Prospectus and (ii) neither
the Company nor any of its Subsidiaries shall have sustained any material loss
or interference with its business or properties from fire, explosion, flood or
other casualty, whether or not covered by insurance, or from any labor dispute
or any court or legislative or other governmental action, order or decree,
which is not set forth in the Registration Statement and the Prospectus, if in
the judgment of the Representatives any such development makes it impracticable
or inadvisable to consummate the sale and delivery of the Shares by the
Underwriters at the initial public offering price.
16
(d) Since the respective dates as of which
information is given in the Registration Statement and the Prospectus, there
shall have been no litigation or other proceeding instituted against the
Company or any of its Subsidiaries or any of their respective officers or
directors in their capacities as such, before or by any Federal, state or local
court, commission, regulatory body, administrative agency or other governmental
body, domestic or foreign, in which litigation or proceeding an unfavorable
ruling, decision or finding would materially and adversely affect the business,
properties, business prospects, condition (financial or otherwise) or results
of operations of the Company and its Subsidiaries taken as a whole.
(e) Each of the representations and warranties of
the Company contained herein shall be true and correct in all material respects
at the Closing Date and, with respect to the Option Shares, at the Option
Closing Date, as if made at the Closing Date and, with respect to the Option
Shares, at the Option Closing Date, and all covenants and agreements herein
contained to be performed on the part of the Company and all conditions herein
contained to be fulfilled or complied with by the Company at or prior to the
Closing Date and, with respect to the Option Shares, at or prior to the Option
Closing Date, shall have been duly performed, fulfilled or complied with.
(f) The Representatives shall have received an
opinion, dated the Closing Date and, with respect to the Option Shares, the
Option Closing Date, and satisfactory in form and substance to counsel for the
Underwriters, from Xxxxxxxxx & Xxxxxxxxx, counsel to the Company, to the effect
set forth in Exhibit D.
(g) The Representatives shall have received an
opinion, dated the Closing Date and the Option Closing Date, from Xxxxxx, Xxxxx
& Bockius LLP, counsel to the Underwriters, with respect to the Registration
Statement, the Prospectus and this Agreement, which opinion shall be
satisfactory in all respects to the Representatives.
(h) On the date of the Prospectus, the Accountants
shall have furnished to the Representatives a letter, dated the date of its
delivery, addressed to the Representatives and in form and substance
satisfactory to the Representatives, confirming that they are independent
accountants with respect to the Company as required by the Act and the Rules
and Regulations and with respect to the financial and other statistical and
numerical information contained in the Registration Statement. At the Closing
Date and, as to the Option Shares, the Option Closing Date, the Accountants
shall have furnished to the Representatives a letter, dated the date of its
delivery, which shall confirm, on the basis of a review in accordance with the
procedures set forth in the letter from the Accountants, that nothing has come
to their attention during the period from the date of the letter referred to in
the prior sentence to a date (specified in the letter) not more than five days
prior to the Closing Date and the Option Closing Date which would require any
change in their letter dated the date of the Prospectus, if it were required to
be dated and delivered at the Closing Date and the Option Closing Date.
17
(i) At the Closing Date and, as to the Option
Shares, the Option Closing Date, there shall be furnished to the
Representatives an accurate certificate, dated the date of its delivery, signed
by each of the Chief Executive Officer and the Chief Financial Officer of the
Company, in form and substance satisfactory to the Representatives, to the
effect that:
(i) Each signer of such certificate has
carefully examined the Registration Statement and the Prospectus and (A) as of
the date of such certificate, such documents are true and correct in all
material respects and do not omit to state a material fact required to be
stated therein or necessary in order to make the statements therein not untrue
or misleading and (B) since the Effective Date, no event has occurred as a
result of which it is necessary to amend or supplement the Prospectus in order
to make the statements therein not untrue or misleading in any material
respect;
(ii) Each of the representations and
warranties of the Company contained in this Agreement were, when originally
made, and are, at the time such certificate is delivered, true and correct in
all material respects;
(iii) Each of the covenants required herein
to be performed by the Company on or prior to the delivery of such certificate
has been duly, timely and fully performed and each condition herein required to
be complied with by the Company on or prior to the date of such certificate has
been duly, timely and fully complied with; and
(iv) Since the respective dates as of which
information is given in the Registration Statement and the Prospectus, (A)
there has not been, and no development has occurred which could reasonably be
expected to result in, a material adverse change in the general affairs,
business, business prospects, properties, management, condition (financial or
otherwise) or results of operations of the Company and its Subsidiaries, taken
as a whole, whether or not arising from transactions in the ordinary course of
business, in each case other than as set forth in or contemplated by the
Registration Statement and the Prospectus and (B) neither the Company nor any
of its Subsidiaries has sustained any material loss or interference with its
business or properties from fire, explosion, flood or other casualty, whether
or not covered by insurance, or from any labor dispute or any court or
legislative or other governmental action, order or decree, which is not set
forth in the Registration Statement and the Prospectus, and such other matters
as the Representatives may reasonably request.
(j) On or prior to the Closing Date, the
Representatives shall have received the executed agreements referred to in
Section 4(n).
18
(k) The Shares shall be qualified for sale in such
states as the Representatives may reasonably request, each such qualification
shall be in effect and not subject to any stop order or other proceeding on the
Closing Date and the Option Closing Date.
(l) Prior to the Closing Date, the Shares shall have
been duly authorized for listing by the New York Stock Exchange upon official
notice of issuance.
(m) The National Association of Securities Dealers,
Inc. shall have approved the underwriting terms and arrangements and such
approval shall not have been withdrawn or limited.
(n) The Company shall have furnished to the
Representatives such certificates, in addition to those specifically mentioned
herein, as the Representatives may have reasonably requested as to the accuracy
and completeness at the Closing Date and the Option Closing Date of any
statement in the Registration Statement or the Prospectus as to the accuracy at
the Closing Date and the Option Closing Date of the representations and
warranties of the Company herein, as to the performance by the Company of its
obligations hereunder, or as to the fulfillment of the conditions concurrent
and precedent to the obligations hereunder of the Representatives.
6. Indemnification.
(a) The Company will indemnify and hold harmless
each Underwriter, the directors, officers, employees and agents of each
Underwriter and each person, if any, who controls each Underwriter within the
meaning of Section 15 of the Act or Section 20 of the Exchange Act from and
against any and all losses, claims, liabilities, expenses and damages
(including, but not limited to, any and all investigative, legal and other
expenses reasonably incurred in connection with, and any and all amounts paid
in settlement of, any action, suit or proceeding between any of the indemnified
parties and any indemnifying parties or between any indemnified party and any
third party, or otherwise, or any claim asserted), as and when incurred, to
which any Underwriter, or any such person, may become subject under the Act,
the Exchange Act or other Federal or state statutory law or regulation, at
common law or otherwise, insofar as such losses, claims, liabilities, expenses
or damages arise out of or are based on (i) any untrue statement or alleged
untrue statement of a material fact contained in any preliminary prospectus,
the Registration Statement or the Prospectus or any amendment or supplement to
the Registration Statement or the Prospectus or in any application or other
document executed by or on behalf of the Company or based on written
information furnished by or on behalf of the Company filed in any jurisdiction
in order to qualify the Shares under the Securities Laws thereof or filed with
the Commission, (ii) the omission or alleged omission to state in such document
a material fact required to be stated in it or necessary to make the statements
in it not misleading or (iii) any act or failure to act or any alleged act or
failure
19
to act by any Underwriter in connection with, or relating in any manner to, the
Shares or the offering contemplated hereby, and which is included as part of or
referred to in any loss, claim, liability, expense or damage arising out of or
based upon matters covered by clause (i) or (ii) above (provided that the
Company shall not be liable under this clause (iii) to the extent it is finally
judicially determined by a court of competent jurisdiction that such loss,
claim, liability, expense or damage resulted directly from any such acts or
failures to act undertaken or omitted to be taken by such underwriter through
its gross negligence or willful misconduct); provided that the Company will not
be liable to the extent that such loss, claim, liability, expense or damage
arises from the sale of the Shares in the public offering to any person by an
Underwriter and is based on an untrue statement or omission or alleged untrue
statement or omission made in reliance on and in conformity with information
relating to any Underwriter furnished in writing to the Company by the
Representatives on behalf of any Underwriter expressly for inclusion in the
Registration Statement, any preliminary prospectus or the Prospectus. This
indemnity agreement will be in addition to any liability that the Company might
otherwise have.
(b) Each Underwriter will indemnify and hold
harmless the Company, each person, if any, who controls the Company within the
meaning of Section 15 of the Act or Section 20 of the Exchange Act, each
director of the Company and each officer of the Company who signs the
Registration Statement to the same extent as the foregoing indemnity from the
Company to each Underwriter, but only insofar as losses, claims, liabilities,
expenses or damages arise out of or are based on any untrue statement or
omission or alleged untrue statement or omission made in reliance on and in
conformity with information relating to any Underwriter furnished in writing to
the Company by the Representatives on behalf of such Underwriter expressly for
use in the Registration Statement, the Preliminary Prospectus or the
Prospectus. This indemnity will be in addition to any liability that each
Underwriter might otherwise have; provided, however, that in no case shall any
Underwriter be liable or responsible for any amount in excess of the
underwriting discounts and commissions received by such Underwriter.
(c) Any party that proposes to assert the right to
be indemnified under this Section 6 will, promptly after receipt of notice of
commencement of any action against such party in respect of which a claim is to
be made against an indemnifying party or parties under this Section 6, notify
each such indemnifying party of the commencement of such action, enclosing a
copy of all papers served, but the omission so to notify such indemnifying
party will not relieve it from any liability that it may have to any
indemnified party under the foregoing provisions of this Section 6 unless, and
only to the extent that, such omission results in the forfeiture of substantive
rights or defenses by the indemnifying party. If any such action is brought
against any indemnified party and it notifies the indemnifying party of its
commencement, the indemnifying party will be entitled to participate in and, to
the extent that it elects by delivering written notice to the indemnified party
promptly after receiving notice of the commencement of the action from the
indemnified party, jointly with any other indemnifying party similarly
notified, to assume
20
the defense of the action, with counsel satisfactory to the indemnified party,
and after notice from the indemnifying party to the indemnified party of its
election to assume the defense, the indemnifying party will not be liable to
the indemnified party for any legal or other expenses except as provided below
and except for the reasonable costs of investigation subsequently incurred by
the indemnified party in connection with the defense. The indemnified party
will have the right to employ its own counsel in any such action, but the fees,
expenses and other charges of such counsel will be at the expense of such
indemnified party unless (1) the employment of counsel by the indemnified party
has been authorized in writing by the indemnifying party, (2) the indemnified
party has reasonably concluded (based on advice of counsel) that there may be
legal defenses available to it or other indemnified parties that are different
from or in addition to those available to the indemnifying party, (3) a
conflict or potential conflict exists (based on advice of counsel to the
indemnified party) between the indemnified party and the indemnifying party (in
which case the indemnifying party will not have the right to direct the defense
of such action on behalf of the indemnified party) or (4) the indemnifying
party has not in fact employed counsel to assume the defense of such action
within a reasonable time after receiving notice of the commencement of the
action, in each of which cases the reasonable fees, disbursements and other
charges of counsel will be at the expense of the indemnifying party or parties.
It is understood that the indemnifying party or parties shall not, in
connection with any proceeding or related proceedings in the same jurisdiction,
be liable for the reasonable fees, disbursements and other charges of more than
one separate firm admitted to practice in such jurisdiction at any one time for
all such indemnified party or parties. All such fees, disbursements and other
charges will be reimbursed by the indemnifying party promptly as they are
incurred. An indemnifying party will not be liable for any settlement of any
action or claim effected without its written consent (which consent will not be
unreasonably withheld). No indemnifying party shall, without the prior written
consent of each indemnified party, settle or compromise or consent to the entry
of any judgment in any pending or threatened claim, action or proceeding
relating to the matters contemplated by this Section 6 (whether or not any
indemnified party is a party thereto), unless such settlement, compromise or
consent includes an unconditional release of each indemnified party from all
liability arising or that may arise out of such claim, action or proceeding.
Notwithstanding any other provision of this Section 6 (c), 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 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 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.
(d) In order to provide for just and equitable
contribution in circumstances in which the indemnification provided for in the
foregoing paragraphs of this
21
Section 6 is applicable in accordance with its terms but for any reason is held
to be unavailable from the Company or the Underwriters, the Company and the
Underwriters will contribute to the total losses, claims, liabilities, expenses
and damages (including any investigative, legal and other expenses reasonably
incurred in connection with, and any amount paid in settlement of, any action,
suit or proceeding or any claim asserted, but after deducting any contribution
received by the Company from persons other than the Underwriters, such as
persons who control the Company within the meaning of the Act, officers of the
Company who signed the Registration Statement and directors of the Company, who
also may be liable for contribution) to which the Company and any one or more
of the Underwriters may be subject in such proportion as shall be appropriate
to reflect the relative benefits received by the Company on the one hand and
the Underwriters on the other. The relative benefits received by the Company on
the one hand and the Underwriters on the other shall be deemed to be in the
same proportion as the total net proceeds from the offering (before deducting
expenses) received by the Company bear to the total underwriting discounts and
commissions received by the Underwriters, in each case as set forth in the
table on the cover page of the Prospectus. If, but only if, the allocation
provided by the foregoing sentence is not permitted by applicable law, the
allocation of contribution shall be made in such proportion as is appropriate
to reflect not only the relative benefits referred to in the foregoing sentence
but also the relative fault of the Company, on the one hand, and the
Underwriters, on the other, with respect to the statements or omissions which
resulted in such loss, claim, liability, expense or damage, or action in
respect thereof, as well as any other relevant equitable considerations with
respect to such offering. Such relative fault shall be determined by reference
to whether the 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 Representatives on behalf of the Underwriters,
the intent of the parties and their relative knowledge, access to information
and opportunity to correct or prevent such statement or omission. The Company
and the Underwriters agree that it would not be just and equitable if
contributions pursuant to this Section 6(d) were to be 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 into account
the equitable considerations referred to herein. The amount paid or payable by
an indemnified party as a result of the loss, claim, liability, expense or
damage, or action in respect thereof, referred to above in this Section 6(d)
shall be deemed to include, for purpose of this Section 6(d), any legal or
other expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this Section 6(d), no Underwriter shall be required to contribute
any amount in excess of the underwriting discounts and commissions received by
it and no person found guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Act) will be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation. The
Underwriters' obligations to contribute as provided in this Section 6(d) are
several in proportion to their respective underwriting obligations and not
joint. For purposes of this Section 6(d), any person who controls a party to
this Agreement within the meaning of the
22
Act will have the same rights to contribution as that party, and each officer
of the Company who signed the Registration Statement will have the same rights
to contribution as the Company, subject in each case to the provisions hereof.
Any party entitled to contribution, promptly after receipt of notice of
commencement of any action against such party in respect of which a claim for
contribution may be made under this Section 6(d), will notify any such party or
parties from whom contribution may be sought, but the omission so to notify
will not relieve the party or parties from whom contribution may be sought from
any other obligation it or they may have under this Section 6 (d). Except for a
settlement entered into pursuant to the last sentence of Section 6 (c) hereof,
no party will be liable for contribution with respect to any action or claim
settled without its written consent (which consent will not be unreasonably
withheld).
(e) The indemnity and contribution agreements
contained in this Section 6 and the representations and warranties of the
Company contained in this Agreement shall remain operative and in full force
and effect regardless of (i) any investigation made by or on behalf of the
Underwriters, (ii) acceptance of the Shares and payment therefore or (iii) any
termination of this Agreement.
7. Termination. The obligations of the several
Underwriters under this Agreement may be terminated at any time on or prior to
the Closing Date (or, with respect to the Option Shares, on or prior to the
Option Closing Date), by notice to the Company from the Representatives,
without liability on the part of any Underwriter to the Company, if, prior to
delivery and payment for the Shares (or the Option Shares, as the case may be),
in the sole judgment of the Representatives, (i) there has been, since the
respective dates as of which information is given in the Registration
Statement, any material adverse change in the Company's business, properties,
business prospects, condition (financial or otherwise) or results of
operations, (ii) trading in any of the equity securities of the Company shall
have been suspended by the Commission, the NASD, by an exchange that lists the
Shares or by the Nasdaq Stock Market, (iii) trading in securities generally on
the New York Stock Exchange or the Nasdaq Stock Market shall have been
suspended or limited or minimum or maximum prices shall have been generally
established on such exchange or over the counter market, or additional material
governmental restrictions, not in force on the date of this Agreement, shall
have been imposed upon trading in securities generally by such exchange or by
order of the Commission or the NASD or any court or other governmental
authority, (iv) a general banking moratorium shall have been declared by either
Federal or New York State authorities or (v) any material adverse change in the
financial or securities markets in the United States or in political, financial
or economic conditions in the United States or any outbreak or material
escalation of hostilities or declaration by the United States of a national
emergency or war or other calamity or crisis shall have occurred the effect of
any of which is such as to make it, in the sole judgment of the
Representatives, impracticable or inadvisable to market the Shares on the terms
and in the manner contemplated by the Prospectus.
23
8. Substitution of Underwriters. If any one or more of
the Underwriters shall fail or refuse to purchase any of the Firm Shares which
it or they have agreed to purchase hereunder, and the aggregate number of Firm
Shares which such defaulting Underwriter or Underwriters agreed but failed or
refused to purchase is not more than one-tenth of the aggregate number of Firm
Shares, the other Underwriters shall be obligated, severally, to purchase the
Firm Shares which such defaulting Underwriter or Underwriters agreed but failed
or refused to purchase, in the proportions which the number of Firm Shares
which they have respectively agreed to purchase pursuant to Section 1 bears to
the aggregate number of Firm Shares which all such non-defaulting Underwriters
have so agreed to purchase, or in such other proportions as the Representatives
may specify; provided that in no event shall the maximum number of Firm Shares
which any Underwriter has become obligated to purchase pursuant to Section 1 be
increased pursuant to this Section 8 by more than one-ninth of the number of
Firm Shares agreed to be purchased by such Underwriter without the prior
written consent of such Underwriter. If any Underwriter or Underwriters shall
fail or refuse to purchase any Firm Shares and the aggregate number of Firm
Shares which such defaulting Underwriter or Underwriters agreed but failed or
refused to purchase exceeds one-tenth of the aggregate number of the Firm
Shares and arrangements satisfactory to the Representatives and the Company for
the purchase of such Firm Shares are not made within 48 hours after such
default, this Agreement will terminate without liability on the part of any
non-defaulting Underwriter or the Company for the purchase or sale of any
Shares under this Agreement. In any such case either the Representatives or the
Company shall have the right to postpone the Closing Date, but in no event for
longer than seven days, in order that the required changes, if any, in the
Registration Statement and in the Prospectus or in any other documents or
arrangements may be effected. Any action taken pursuant to this Section 8 shall
not relieve any defaulting Underwriter from liability in respect of any default
of such Underwriter under this Agreement.
9. Miscellaneous. Notice given pursuant to any of the
provisions of this Agreement shall be in writing and, unless otherwise
specified, shall be mailed or delivered (a) if to the Company, at the office of
the Company, 0000 Xxxx Xxxxxxx, Xxxxx 000, Xxxxxxx, Xxxxx 00000, Attention: Xxx
X. Xxxxxxxxx, or (b) if to the Underwriters, to the Representatives at the
offices of PaineWebber Incorporated, 0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, Xxx
Xxxx 00000, Attention: [Xxxxxxxx X. Xxxxxxxxx], Corporate Finance Department.
Any such notice shall be effective only upon receipt. Any notice under Section
7 or 8 may be made by telex or telephone, but if so made shall be subsequently
confirmed in writing.
This Agreement has been and is made solely for the benefit of
the several Underwriters and the Company and of the controlling persons,
directors and officers referred to in Section 6, and their respective
successors and assigns, and no other person shall acquire or have any right
under or by virtue of this Agreement. The term "successors
24
and assigns" as used in this Agreement shall not include a purchaser, as such
purchaser, of Shares from any of the several Underwriters.
All representations, warranties and agreements of the Company
contained herein or in certificates or other instruments delivered pursuant
hereto, shall remain operative and in full force and effect regardless of any
investigation made by or on behalf of any Underwriter or any of its controlling
persons and shall survive delivery of and payment for the Shares hereunder.
Any action required or permitted to be taken by the
Representatives under this Agreement may be taken by them jointly or by
PaineWebber Incorporated.
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO THE
CONFLICT OF LAWS PRINCIPLES OF SUCH STATE.
This Agreement may be signed in two or more counterparts with
the same effect as if the signatures thereto and hereto were upon the same
instrument.
In case any provision in this Agreement shall be invalid,
illegal or unenforceable, the validity, legality and enforceability of the
remaining provisions shall not in any way be affected or impaired thereby.
The Company and the Underwriters each hereby irrevocably
waive any right they may have to a trial by jury in respect of any claim based
upon or arising out of this Agreement or the transactions contemplated hereby.
This Agreement may not be amended or otherwise modified or
any provision hereof waived except by an instrument in writing signed by the
Representatives and the Company.
25
Please confirm that the foregoing correctly sets forth the
agreement among the Company and the several Underwriters.
Very truly yours,
ADVANCED COMMUNICATIONS GROUP, INC.
By:
--------------------------------------
Title:
Confirmed as of the date first
above mentioned:
PAINEWEBBER INCORPORATED
XXXXXXXXXXX & CO., INC.
Acting on behalf of themselves
and as the Representatives of the
other several Underwriters
named in Schedule I hereof.
By: PAINEWEBBER INCORPORATED
By:
------------------------------------
Title:
XXXXXXXXXXX & CO., INC.
By:
------------------------------------
By:
------------------------------------
26
SCHEDULE I
UNDERWRITERS
Number of
Name of Firm Shares
Underwriters to be Purchased
------------ ---------------
PaineWebber Incorporated
Xxxxxxxxxxx & Co., Inc.
Total......................................................
----------------
----------------
1
EXHIBIT A
ADVANCED COMMUNICATIONS GROUP, INC.
---------------------
PRICE DETERMINATION AGREEMENT
[Date]
PAINEWEBBER INCORPORATED
XXXXXXXXXXX & CO., INC.
As Representatives of the several Underwriters
c/o PaineWebber Incorporated
1285 Avenue of the Americas
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
Reference is made to the Underwriting Agreement, dated
______, 1997 (the "Underwriting Agreement"), among Advanced Communications
Group, Inc., a Delaware corporation (the "Company") and the several
Underwriters named in Schedule I thereto or hereto (the "Underwriters"), for
whom PaineWebber Incorporated and Xxxxxxxxxxx & Co., Inc. are acting as
representatives (the "U.S. Representatives"). The Underwriting Agreement
provides for the purchase by the Underwriters from the Company, subject to the
terms and conditions set forth therein, of an aggregate of ________ shares (the
"Firm Shares") of the Company's common stock, par value $____ per share. This
Agreement is the Price Determination Agreement referred to in the Underwriting
Agreement.
Pursuant to Section 1 of the Underwriting Agreement, the
undersigned agree with the Representatives as follows:
The initial public offering price per share for the Firm
Shares shall be $_______.
The purchase price per share for the Firm Shares to be paid
by the several Underwriters shall be $_______ representing an amount equal to
the initial public offering price set forth above, less $______ per share.
The Company represents and warrants to each of the
Underwriters that the representations and warranties of the Company set forth
in Section 3 of the Underwriting Agreement are accurate as though expressly
made at and as of the date hereof.
As contemplated by the Underwriting Agreement, attached as
Schedule I is a completed list of the several Underwriters, which shall be a
part of this Agreement and the Underwriting Agreement.
THIS AGREEMENT SHALL BE GOVERNED BY THE LAW OF THE STATE OF
NEW YORK WITHOUT REGARD TO THE CONFLICT OF LAWS PRINCIPLES OF SUCH STATE.
If the foregoing is in accordance with your understanding of
the agreement among the Underwriters and the Company, please sign and return to
the Company a counterpart hereof, whereupon this instrument along with all
counterparts and together with
2
the Underwriting Agreement shall be a binding agreement among the Underwriters
and the Company in accordance with its terms and the terms of the Underwriting
Agreement.
Very truly yours,
ADVANCED COMMUNICATIONS GROUP, INC.
By:
----------------------------------------
Title:
Confirmed as of the date
first above mentioned:
PAINEWEBBER INCORPORATED
XXXXXXXXXXX & CO., INC.
Acting on behalf of themselves
and as the Representatives
of the other several Underwriters
named in Schedule I hereof.
By: PAINEWEBBER INCORPORATED
By:
--------------------------------------
Title:
XXXXXXXXXXX & CO., INC.
By:
--------------------------------------
By: ]
--------------------------------------
3
EXHIBIT B
[DATE]
PAINEWEBBER INCORPORATED
XXXXXXXXXXX & CO., INC.
As Representatives of the
several Underwriters
c/o PaineWebber Incorporated
1285 Avenue of the Americas
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
In consideration of the agreement of the several
Underwriters, for which PaineWebber Incorporated and Xxxxxxxxxxx & Co., Inc.
(the "Representatives") intend to act as Representatives to underwrite a
proposed public offering (the "Offering") of ____ shares of Common Stock, par
value $______ per share (the "Common Stock") of Advanced Communications Group,
Inc., a Delaware corporation, as contemplated by a registration statement with
respect to such shares filed with the Securities and Exchange Commission on
Form S-1 (Registration No. _________), the undersigned hereby agrees that the
undersigned will not, for a period of 365 days after the commencement of the
public offering of such shares, without the prior written consent of
PaineWebber Incorporated, offer to sell, sell, contract to sell, grant any
option to sell, or otherwise dispose of, or require the Company to file with
the Securities and Exchange Commission a registration statement under the
Securities Act of 1933 to register any shares of Common Stock or securities
convertible into or exchangeable for Common Stock or warrants or other rights
to acquire shares of Common Stock of which the undersigned is now, or may in
the future become, the beneficial owner within the meaning of Rule 13d-3 under
the Securities Exchange Act of 1934)[(other than pursuant to employee stock
[Revised March 31, 1997]
option plans or in connection with other employee incentive compensation
arrangements)].*/
Very truly yours,
By:
--------------------------------
Print Name:
------------------------
-------------
*/ Insert if this letter agreement will be signed by an employee of the
Company.
2
EXHIBIT C
[DATE]
PAINEWEBBER INCORPORATED
XXXXXXXXXXX & CO., INC.
As Representatives of the
several Underwriters
c/o PaineWebber Incorporated
1285 Avenue of the Americas
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
In consideration of the agreement of the several
Underwriters, for which PaineWebber Incorporated and Xxxxxxxxxxx & Co., Inc.
(the "Representatives") intend to act as Representatives to underwrite a
proposed public offering (the "Offering") of ____ shares of Common Stock, par
value $______ per share (the "Common Stock") of Advanced Communications Group,
Inc., a Delaware corporation, as contemplated by a registration statement with
respect to such shares filed with the Securities and Exchange Commission on
Form S-1 (Registration No. _________), the undersigned hereby agrees that the
undersigned will not, for a period ending on March 31, 1999, without the prior
written consent of PaineWebber Incorporated, offer to sell, sell, contract to
sell, grant any option to sell, or otherwise dispose of, or require the Company
to file with the Securities and Exchange Commission a registration statement
under the Securities Act of 1933 to register any shares of Common Stock or
securities convertible into or exchangeable for Common Stock or warrants or
other rights to acquire shares of Common Stock of which the undersigned is now,
or may in the future become, the beneficial owner within the meaning of Rule
13d-3 under the Securities Exchange Act of 1934)option plans or in connection
with other employee incentive compensation arrangements).
Very truly yours,
By:
-----------------------------------
Print Name:
---------------------------
[Revised March 31, 1997]
EXHIBIT D
Form of Opinion of
Counsel to the Company
The Company and each of its Subsidiaries (hereinafter
Subsidiary shall also mean Acquired Company) is a corporation duly organized,
validly existing and in good standing under the laws of the jurisdiction of its
incorporation and has full corporate power and authority to conduct all the
activities conducted by it, to own or lease all the assets owned or leased by
it and to conduct its business as described in the Registration Statement and
the Prospectus. The Company is the sole record owner and, to our knowledge, the
sole beneficial owner of all of the capital stock of each of its Subsidiaries.
All of the outstanding shares of Common Stock have been, and
the Shares, when paid for by the Underwriters in accordance with the terms of
the Agreement, will be, duly authorized, validly issued, fully paid and
nonassessable and will not be subject to any preemptive or similar right under
(i) the statutes, judicial and administrative decisions, and the rules and
regulations of the governmental agencies of the State of Delaware, (ii) the
Company's certificate of incorporation or by-laws or (iii) any instrument,
document, contract or other agreement referred to in the Registration Statement
or any instrument, document, contract or agreement filed as an exhibit to the
Registration Statement. Except as described in the Registration Statement or
the Prospectus, to the best of our knowledge, there is no commitment or
arrangement to issue, and there are no outstanding options, warrants or other
rights calling for the issuance of, any share of capital stock of the Company
or any Subsidiary to any person or any security or other instrument that by its
terms is convertible into, exercisable for or exchangeable for capital stock of
the Company.
No consent, approval, authorization or order of, or any
filing or declaration with, any court or governmental agency or body is
required in connection with the authorization, issuance, transfer, sale or
delivery of the Shares by the Company, in connection with the execution,
delivery and performance of the Agreement by the Company or in connection with
the taking by the Company of any action contemplated thereby [or, if so
required, all such consents, approvals, authorizations and orders, [specifying
the same] have been obtained and are in full force and effect], except such as
have been obtained under the Act and the Rules and Regulations and such as may
be required under state securities or "Blue Sky" laws or by the by-laws and
rules of the NASD in connection with the purchase and distribution by the
Underwriters of the Shares to be
2
[Revised March 31, 1997]
sold by the Company. All references in this opinion to the Agreement shall
include the Price Determination Agreement.
The authorized, issued and outstanding capital stock of the
Company is as set forth in the Registration Statement and the Prospectus under
the caption "Capitalization." The description of the Common Stock contained in
the Prospectus is complete and accurate in all material respects. The form of
certificate used to evidence the Common Stock is in due and proper form and
complies with all applicable statutory requirements.
The Registration Statement and the Prospectus comply in all
material respects as to form with the requirements of the Act and the Rules and
Regulations (except that we express no opinion as to financial statements,
schedules and other financial data contained in the Registration Statement or
the Prospectus.
To the best of our knowledge, any instrument, document,
lease, license, contract or other agreement (collectively, "Documents")
required to be described or referred to in the Registration Statement or the
Prospectus has been properly described or referred to therein and any Document
required to be filed as an exhibit to the Registration Statement has been filed
as an exhibit thereto or has been incorporated as an exhibit by reference in
the Registration Statement; and no default exists in the due performance or
observance of any material obligation, agreement, covenant or condition
contained in any Document filed or required to be filed as an exhibit to the
Registration Statement.
To the best of our knowledge, except as disclosed in the
Registration Statement or the Prospectus, no person or entity has the right to
require the registration under the Act of shares of Common Stock or other
securities of the Company by reason of the filing or effectiveness of the
Registration Statement.
To the best of our knowledge, the Company is not in violation
of, or in default with respect to, any law, rule, regulation, order, judgment
or decree, except as may be described in the Prospectus or such as in the
aggregate do not now have and will not in the future have a material adverse
effect upon the operations, business or assets of the Company and the
Subsidiaries, taken as a whole.
All descriptions in the Prospectus of statutes, regulations
or legal or governmental proceedings are accurate and fairly present the
information required to be shown.
3
[Revised March 31, 1997]
The Company has full corporate power and authority to enter
into the Agreement, and the Agreement has been duly authorized, executed and
delivered by the Company, is a valid and binding agreement of the Company and,
except for the indemnification and contribution provisions thereof, as to which
we express no opinion, is enforceable against the Company in accordance with
the terms thereof.
The execution and delivery by the Company of, and the
performance by the Company of its agreements in, the Agreement do not and will
not (i) violate the certificate of incorporation or by-laws of the Company,
(ii) breach or result in a default under, cause the time for performance of any
obligation to be accelerated under, or result in the creation or imposition of
any lien, charge or encumbrance upon any of the assets of the Company or any of
its Subsidiaries pursuant to the terms of, (x) any indenture, mortgage, deed of
trust, loan agreement, bond, debenture, note agreement, capital lease or other
evidence of indebtedness of which we have knowledge, (y) any voting trust
arrangement or any contract or other agreement to which the Company is a party
that restricts the ability of the Company to issue securities and of which we
have knowledge or (z) any Document filed as an exhibit to the Registration
Statement, (iii) breach or otherwise violate any existing obligation of the
Company under any court or administrative order, judgment or decree of which we
have knowledge or (iv) violate applicable provisions of any statute or
regulation in the States of Delaware, Kansas, Nebraska, Minnesota,
Xxxxx Xxxxxx, Xxxxxxxx, Xxxxx Xxxxxx, Xxxxx and Wyoming and of the United
States.
Delivery of certificates for the Shares will transfer valid
and marketable title thereto to each Underwriter that has purchased such Shares
in good faith and without notice of any adverse claim with respect thereto.
The Company is not an "investment company" or an "affiliated
person" of, or "promoter" or "principal underwriter" for, an "investment
company," as such terms are defined in the Investment Company Act of 1940, as
amended.
The Shares have been duly authorized for listing by the New
York Exchange upon official notice of issuance.
We hereby confirm to you that we have been advised by the
Commission that the Registration Statement has become effective under the Act
and that no order suspending the effectiveness of the Registration Statement
has been issued and no proceeding for that purpose has been instituted or is
pending, threatened or contemplated.
4
[Revised March 31, 1997]
We hereby further confirm to you that there are no actions,
suits, proceedings or investigations pending or, to our knowledge, overtly
threatened in writing against the Company or any of its Subsidiaries, or any of
their respective officers or directors in their capacities as such, before or
by any court, governmental agency or arbitrator which (i) seek to challenge the
legality or enforceability of the Agreement, (ii) seek to challenge the
legality or enforceability of any of the Documents filed, or required to be
filed, as exhibits to the Registration Statement, (iii) seek damages or other
remedies with respect to any of the Documents filed, or required to be filed,
as exhibits to the Registration Statement, (iv) except as set forth in or
contemplated by the Registration Statement and the Prospectus, seek money
damages in excess of $_______ or seek to impose criminal penalties upon the
Company, any of its Subsidiaries or any of their respective officers or
directors in their capacities as such and of which we have knowledge or (v)
seek to enjoin any of the business activities of the Company or any of its
Subsidiaries or the transactions described in the Prospectus and of which we
have knowledge.
We have participated in the preparation of the Registration
Statement and the Prospectus and, without assuming any responsibility for the
accuracy, completeness or fairness of the statements contained in the
Registration Statement or the Prospectus or in any amendment or supplement
thereto nothing has come to our attention that causes us to believe that, both
as of the Effective Date and as of the Closing Date and the Option Closing
Date, the Registration Statement or any amendment thereto contained or contains
any untrue statement of a material fact or omitted or omits to state a material
fact required to be stated therein or necessary to make the statements therein
not misleading or that any Prospectus or any amendment or supplement thereto at
the time such Prospectus was issued, at the time any such amended or
supplemented Prospectus was issued, at the Closing Date and the Option Closing
Date, contained or contains any untrue statement of a material fact or omitted
or omits to state a material fact necessary in order to make the statements
therein, in the light of the circumstances in which they were made, not
misleading (except that we express no opinion as to financial statements,
schedules and other financial data contained in the Registration Statement or
the Prospectus.
The foregoing opinion is subject to the qualification that
the enforceability of the Agreement may be: (i) subject to bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting creditors'
rights generally; and (ii) subject to general principles of equity (regardless
of whether such enforceability is considered in a proceeding at law or in
equity) including principles of commercial reasonableness or conscionability
and an implied covenant of good faith and fair dealing.
This letter is furnished by us solely for your benefit in
connection with the transactions referred to in the Agreement and may not be
circulated to, or relied upon by,
5
[Revised March 31, 1997]
any other person, except that this letter may be relied upon by your counsel in
connection with the opinion letter to be delivered to you pursuant to Section
5(g) of the Agreement.
[Where appropriate, include additional opinions with respect
to matters such as patents, franchises, specific litigation, regulatory
approvals, etc.]
[In rendering the foregoing opinion, counsel may rely, to the
extent they deem such reliance proper, on the opinions (in form and substance
reasonably satisfactory to Underwriters' counsel) of other counsel reasonably
acceptable to Underwriters' counsel as to matters governed by the laws of
jurisdictions other than the United States and the State of [specify], and as
to matters of fact, upon certificates of officers of the Company, the Selling
Shareholders and of government officials; provided that such counsel shall
state that the opinion of any other counsel is in form satisfactory to such
counsel. Copies of all such opinions and certificates shall be furnished to
counsel to the Underwriters on the Closing Date.]
6
