[ ] SHARES Exhibit 1.1
GREENFIELD ONLINE, INC.
COMMON STOCK
UNDERWRITING AGREEMENT
[______], 2004
XXXXXX BROTHERS INC.
FRIEDMAN, BILLINGS, XXXXXX & CO., INC.
XXXXX XXXXXXX & CO.
As Representatives of the
several underwriters named in Schedule 1 hereto
c/x XXXXXX BROTHERS INC.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Ladies and Gentlemen:
Greenfield Online, Inc., a Delaware corporation (the "COMPANY"), and
certain stockholders of the Company named in Schedule 2 hereto (the "SELLING
STOCKHOLDERS"), propose to sell an aggregate of [ ] shares (the "FIRM STOCK") of
the Company's Common Stock, par value $0.0001 per share (the "COMMON STOCK"). Of
the [______] shares of the Firm Stock, [____] are being sold by the Company and
[____] by the Selling Stockholders. In addition, the Selling Stockholders
propose to grant to the Underwriters named in Schedule 1 hereto (the
"UNDERWRITERS") an option to purchase up to an additional [ ] shares of the
Common Stock on the terms and for the purposes set forth in Section 3 (the
"OPTION STOCK"). The Firm Stock and the Option Stock, if purchased, are
hereinafter collectively called the "STOCK." This is to confirm the agreement
concerning the purchase of the Stock from the Company and the Selling
Stockholders by the Underwriters.
SECTION 1. Representations, Warranties and Agreements of the Company. The
Company represents and warrants to, and agrees with, the Underwriters that:
(a) A registration statement on Form S-1 with respect to the Stock has (i)
been prepared by the Company in conformity in all material respects with the
requirements of the Securities Act of 1933, as amended (the "SECURITIES ACT"),
and the rules and regulations (the "RULES AND REGULATIONS") of the United States
Securities and Exchange Commission (the "COMMISSION") thereunder, (ii) been
filed with the Commission under the Securities Act and (iii) become effective
under the Securities Act. Copies of such registration statement and each of the
amendments thereto have been delivered by the Company to you as the
representatives (the "REPRESENTATIVES") of the Underwriters. As used in this
Agreement, "EFFECTIVE TIME" means the date and the time as of which such
registration statement, or the most recent post-effective amendment thereto, if
any, was declared effective by the Commission; "EFFECTIVE DATE" means the date
of the Effective Time; "PRELIMINARY PROSPECTUS" means each prospectus included
in
such registration statement, or amendments thereof, before it became effective
under the Securities Act and any prospectus filed with the Commission by the
Company with the consent of the Representatives pursuant to Rule 424(a) of the
Rules and Regulations; "REGISTRATION STATEMENT" means such registration
statement, as amended at the Effective Time, including all information contained
in the final prospectus filed with the Commission pursuant to Rule 424(b) of the
Rules and Regulations and deemed to be a part of such registration statement as
of the Effective Time pursuant to Rule 430A of the Rules and Regulations; and
"PROSPECTUS" means the prospectus in the form first used to confirm sales of
Stock. If the Company has filed an abbreviated registration statement to
register additional shares of Common Stock pursuant to Rule 462(b) under the
Securities Act (the "RULE 462 REGISTRATION STATEMENT"), then any reference
herein to the term "REGISTRATION STATEMENT" shall be deemed to include such Rule
462 Registration Statement. The Commission has not issued any order preventing
or suspending the use of any Preliminary Prospectus.
(b) The Registration Statement conforms, and the Prospectus and any
further amendments or supplements to the Registration Statement or the
Prospectus will, when they become effective or are filed with the Commission, as
the case may be, conform in all material respects to the requirements of the
Securities Act and the Rules and Regulations and do not and will not, as of the
applicable effective date (as to the Registration Statement and any amendment
thereto) and as of the applicable filing date (as to the Prospectus and any
amendment or supplement thereto) contain an untrue statement of a material fact
or omit to state a material fact required to be stated therein or necessary to
make the statements therein not misleading in the case of the Registration
Statement, and, in the case of the Prospectus only, in light of the
circumstances under which they were made; provided that no representation or
warranty is made as to information contained in or omitted from the Registration
Statement or the Prospectus in reliance upon and in conformity with written
information furnished to the Company through the Representatives by or on behalf
of any Underwriter specifically for inclusion therein.
(c) The Company and each of its subsidiaries (as defined in Section 17)
have been duly incorporated and are validly existing as corporations in good
standing under the laws of their respective jurisdictions of incorporation, are
duly qualified to do business and are in good standing as foreign corporations
in each jurisdiction in which their respective ownership or lease of property or
the conduct of their respective businesses requires such qualification except
where the failure to be so qualified and in good standing could not have a
material adverse effect on the consolidated financial position, stockholders'
equity, results of operations or business of the Company and its subsidiaries
taken as a whole (a "MATERIAL ADVERSE EFFECT"), and have all power and authority
necessary to own or hold their respective properties and to conduct the
businesses in which they are engaged; and none of the subsidiaries of the
Company, other than [Greenfield Online Private Ltd.], is a "significant
subsidiary," as such term is defined in Rule 405 of the Rules and Regulations.
(d) The Company has an authorized capitalization as set forth in the
Prospectus. All of the issued shares of capital stock of the Company have been
duly and validly authorized and issued, were issued in compliance with federal
and state securities laws, are fully paid and non-assessable and conform to the
description thereof contained in the Prospectus. All of the Company's options,
warrants and other rights to purchase or exchange any securities for shares of
the Company's capital stock have been duly and validly authorized and issued,
were issued in compliance with federal and state securities laws, and conform to
the description thereof contained in the Prospectus. All of the issued shares of
capital stock of each subsidiary of the Company have been duly and validly
authorized and issued and are fully paid and non-assessable and are owned
directly or indirectly by the Company, free and clear of all liens,
encumbrances,
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equities or claims. Except as set forth in the Prospectus, the Company is not a
party to any agreement obligating it to issue any options, warrants or other
rights to purchase, or rights to convert any obligations into or exchange any
securities for, shares of capital stock of the Company.
(e) The unissued shares of the Stock to be issued and sold by the Company
to the Underwriters hereunder have been duly and validly authorized and, when
issued and delivered against payment therefor in accordance with this Agreement,
will be duly and validly issued, fully paid and non-assessable and free of
statutory and contractual preemptive rights, resale rights, rights of first
refusal and similar rights; and the Stock will conform to the description
thereof contained in the Prospectus. Upon payment for and delivery of the Stock
to be sold by the Company pursuant to this Agreement, the Underwriters will
acquire good and valid title to such Stock, in each case free and clear of all
liens, encumbrances, equities, preemptive rights, subscription rights, other
rights to purchase, voting or transfer restrictions and other claims.
(f) This Agreement has been duly authorized, executed and delivered by the
Company.
(g) The execution, delivery and performance of this Agreement by the
Company and the consummation of the transactions contemplated hereby and the
application of the proceeds from the sale of the Stock as described under "Use
of Proceeds" in the Prospectus will not conflict with or result in a breach or
violation of any of the terms or provisions of, or constitute a default under,
any indenture, mortgage, deed of trust, loan agreement or other agreement or
instrument to which the Company or any of its subsidiaries is a party or by
which the Company or any of its subsidiaries is bound or to which any of the
property or assets of the Company or any of its subsidiaries is subject except
for such conflicts, breaches, violations or defaults that could not have or be
reasonably expected to have a Material Adverse Effect, nor will such actions
result in any violation of the provisions of the charter or by-laws of the
Company or any of its subsidiaries or any statute or any order, rule or
regulation of any court or governmental agency or body having jurisdiction over
the Company or any of its subsidiaries or any of their properties or assets; and
except for the registration of the Stock under the Securities Act and such
consents, approvals, authorizations, registrations or qualifications as may be
required under the Securities Exchange Act of 1934, as amended (the "EXCHANGE
ACT") and applicable state securities laws in connection with the purchase and
distribution of the Stock by the Underwriters, no consent, approval,
authorization or order of, or filing or registration with, any such court or
governmental agency or body is required for the execution, delivery and
performance of this Agreement by the Company and the consummation of the
transactions contemplated hereby.
(h) Except as described in the Prospectus, there are no contracts,
agreements or understandings between the Company and any person granting such
person the right (other than rights that have been waived or satisfied) to
require the Company to file a registration statement under the Securities Act
with respect to any securities of the Company owned or to be owned by such
person or to require the Company to include such securities in the securities
registered pursuant to the Registration Statement or in any securities being
registered pursuant to any other registration statement filed by the Company
under the Securities Act. Except as described in the Prospectus, there are no
outstanding preemptive or other rights to subscribe for the Company's capital
stock (other than rights that have been waived or satisfied).
(i) Excepted as described in the Registration Statement, the Company has
not sold or issued any shares of Common Stock during the six-month period
preceding the date of the Prospectus, including any sales pursuant to Rule 144A
under, or Regulations D or S of, the
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Securities Act other than shares issued pursuant to employee benefit plans,
qualified stock options plans or other employee compensation plans or pursuant
to outstanding options, rights or warrants.
(j) Neither the Company nor any of its subsidiaries has sustained, since
the date of the latest audited financial statements included in the Prospectus,
any material loss or interference with its business from fire, explosion, flood
or other calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree, otherwise than as set
forth or contemplated in the Prospectus; and, since such date, there has not
been any change in the capital stock (except for the grant of options in the
ordinary course of the Company's business pursuant to its stock plans or as
otherwise described in the Prospectus) or long-term debt (other than changes
occurring in the ordinary course of business in the outstanding amount of
indebtedness under that certain accounts receivable financing agreement to which
the Company is a party) of the Company or any of its subsidiaries or any
material adverse change, or any development involving a prospective material
adverse change, in or affecting the general affairs, management, consolidated
financial position, stockholders' equity, results of operations, business or
prospects of the Company and its subsidiaries taken as a whole, otherwise than
as set forth or contemplated in the Prospectus.
(k) The financial statements (including the related notes and supporting
schedules) filed as part of the Registration Statement or included in the
Prospectus present fairly in all material respects the financial condition and
results of operations of the entities purported to be shown thereby, at the
dates and for the periods indicated, and have been prepared in conformity with
generally accepted accounting principles applied on a consistent basis
throughout the periods involved except as otherwise stated therein.
(l) PricewaterhouseCoopers, LLP, whose reports with respect to certain
financial statements of the Company appear in the Prospectus and who has
delivered the initial letter referred to in Section 9(g) hereof, are independent
public accountants as required by the Securities Act and the Rules and
Regulations.
(m) The Company and each of its subsidiaries have valid title in fee
simple to all real property and valid title to all personal property owned by
them, in each case free and clear of all liens and encumbrances, except such as
are described in the Prospectus (or effected pursuant to agreements filed as
exhibits to the Registration Statement) or such as do not materially affect the
value of such property and do not materially interfere with the use made and
proposed to be made of such property by the Company and its subsidiaries; and
all assets held under lease by the Company and its subsidiaries are held by them
under valid, subsisting and enforceable leases, with such exceptions as are not
material and do not interfere with the use made and proposed to be made of such
property and buildings by the Company and its subsidiaries.
(n) The Company and each of its subsidiaries carry, or are covered by,
insurance in such amounts and covering such risks as is commercially reasonable
for the conduct of their respective businesses and the value of their
respective properties.
(o) Except as set forth in the Prospectus, the Company and each of its
subsidiaries (i) own or possess the rights to use all patents, patent
applications, trademarks, service marks, trade names, trademark registrations,
service xxxx registrations, copyrights, software, trade secrets and licenses
(collectively, the "INTELLECTUAL PROPERTY") necessary for the conduct of their
respective businesses except where failure to own or possess such rights could
not reasonably be expected to have a Material Adverse Effect, and (ii) have no
reason to believe that the conduct of
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their respective businesses will infringe or violate, and have not received any
notice of any claim of infringement or violation of, any such rights of others.
(p) Except as set forth in the Prospectus, there are no legal or
governmental proceedings pending to which the Company or any of its subsidiaries
is a party or of which any property or assets of the Company or any of its
subsidiaries is the subject which, if determined adversely to the Company or any
of its subsidiaries, could reasonably be expected to have a Material Adverse
Effect; and to the Company's knowledge, no such proceedings are threatened or
contemplated by governmental authorities or threatened by others. For the
purposes of this Agreement, an individual will be deemed to have "KNOWLEDGE" of
a particular fact or other matter if (a) such individual is actually aware of
such fact or other matter or (b) a prudent individual would reasonably be
expected to discover or otherwise become aware of such fact or other matter in
the ordinary course; and a person (other than an individual) will be deemed to
have "KNOWLEDGE" of a particular fact or other matter if any individual who is
serving as a director, officer, executor or trustee of such person has knowledge
(as defined above with respect to an individual) of such fact or other matter.
(q) There are no contracts or other documents which are required to be
described in the Prospectus or filed as exhibits to the Registration Statement
by the Securities Act or by the Rules and Regulations which have not been
described in the Prospectus or filed as exhibits to the Registration Statement
or incorporated therein by reference in accordance with the Rules and
Regulations of the Commission.
(r) No relationship, direct or indirect, exists between or among the
Company on the one hand, and the directors, officers, stockholders, customers or
suppliers of the Company on the other hand, which is required to be described in
the Prospectus and is not so described.
(s) No labor disturbance by the employees of the Company, or of any of the
Company's subsidiaries, exists or, to the knowledge of the Company, is imminent,
which could reasonably be expected to have a Material Adverse Effect.
(t) The Company is in compliance in all material respects with all
presently applicable provisions of the Employee Retirement Income Security Act
of 1974, as amended, including the regulations and published interpretations
thereunder ("ERISA"); no "REPORTABLE EVENT" (as defined in ERISA) has occurred
with respect to any "PENSION PLAN" (as defined in ERISA) for which the Company
would have any material liability; the Company has not incurred and does not
reasonably expect to incur material liability under (i) Title IV of ERISA with
respect to the termination of, or withdrawal from, any "pension plan" or (ii)
Sections 412 or 4971 of the Internal Revenue Code of 1986, as amended, including
the regulations and published interpretations thereunder (the "CODE"); and each
"pension plan" for which the Company would have any material liability that is
intended to be qualified under Section 401(a) of the Code is so qualified in all
material respects and nothing has occurred, whether by action or by failure to
act, which could reasonably be expected to cause the loss of such qualification.
(u) The Company has filed all federal, state, local and foreign income and
franchise tax returns required to be filed through the date hereof and has paid
all taxes due thereon, other than taxes that have not been assessed or the
validity of which the Company is contesting in good faith by adequate
proceedings and for which the Company has established reserves in accordance
with generally accepted account principles, and, since the date of the Company's
last audited financial statements, no tax deficiency has been determined
adversely to the Company or any of its subsidiaries which has had (nor does the
Company have any knowledge of any tax deficiency
5
which, if determined adversely to the Company or any of its subsidiaries, could
reasonably be expected to have) a Material Adverse Effect.
(v) Since the date as of which information is given in the Prospectus
through the date hereof, and except as may otherwise be disclosed in the
Prospectus, the Company has not (i) issued or granted any securities, (ii)
incurred any liability or obligation, direct or contingent, other than
non-material liabilities and obligations which were incurred in the ordinary
course of business, (iii) entered into any material transaction not in the
ordinary course of business or (iv) declared or paid any dividend on its capital
stock.
(w) The Company (i) makes and keeps accurate books and records and (ii)
maintains internal accounting controls which provide reasonable assurance that
(A) transactions are executed in accordance with management's authorization, (B)
transactions are recorded as necessary to permit preparation of its financial
statements and to maintain accountability for its assets, (C) access to its
assets is permitted only in accordance with management's authorization and (D)
the reported accountability for its assets is compared with existing assets at
reasonable intervals.
(x) Neither the Company nor any of its subsidiaries (i) is in violation of
its charter or by-laws, (ii) is in default in any respect, and, to the knowledge
of the Company, no event has occurred which, with notice or lapse of time or
both, would constitute such a default, in the due performance or observance of
any term, covenant or condition contained in any indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument to which it is a party or
by which it is bound or to which any of its properties or assets is subject,
which default could reasonably be expected to have a Material Adverse Effect or
(iii) is in violation in any respect of any law, ordinance, governmental rule,
regulation or court decree to which it or its property or assets may be subject
or has failed to obtain any material license, permit, certificate, franchise or
other governmental authorization or permit necessary to the ownership of its
property or to the conduct of its business where such violation or failure could
reasonably be expected to have a Material Adverse Effect.
(y) Neither the Company nor any of its subsidiaries, nor, to the knowledge
of the Company, any director, officer, agent, employee or other person
associated with or acting on behalf of the Company or any of its subsidiaries,
has used any of the Company's funds for any unlawful contribution, gift,
entertainment or other unlawful expense relating to political activity; made any
direct or indirect unlawful payment to any foreign or domestic government
official or employee from the Company's funds; violated or is in violation of
any provision of the Foreign Corrupt Practices Act of 1977; or made any bribe,
payoff, influence payment, kickback or other unlawful payment.
(z) There has been no storage, disposal, generation, manufacture,
refinement, transportation, handling or treatment of toxic wastes, medical
wastes, hazardous wastes or hazardous substances by the Company or any of its
subsidiaries (or, to the knowledge of the Company, any of their predecessors in
interest) at, upon or from any of the property now or previously owned or leased
by the Company or its subsidiaries in violation of any applicable law,
ordinance, rule, regulation, order, judgment, decree or permit or which would
require remedial action under any applicable law, ordinance, rule, regulation,
order, judgment, decree or permit, except for any violation or remedial action
which would not have, or could not reasonably be expected to have, singularly or
in the aggregate with all such violations and remedial actions, a Material
Adverse Effect; there has been no material spill, discharge, leak, emission,
injection, escape, dumping or release of any kind onto such property or into the
environment surrounding
6
such property of any toxic wastes, medical wastes, solid wastes, hazardous
wastes or hazardous substances due to or caused by the Company or any of its
subsidiaries or with respect to which the Company or any of its subsidiaries
have knowledge, except for any such spill, discharge, leak, emission, injection,
escape, dumping or release which would not have or would not reasonably be
expected to have, singularly or in the aggregate with all such spills,
discharges, leaks, emissions, injections, escapes, dumpings and releases, a
Material Adverse Effect. The terms "HAZARDOUS WASTES", "TOXIC WASTES",
"HAZARDOUS SUBSTANCES" and "MEDICAL WASTES" shall have the meanings specified in
any applicable local, state, federal and foreign laws or regulations with
respect to environmental protection.
(aa) Neither the Company nor any subsidiary is, nor as of the Closing Date
will be, an "investment company" as defined in the Investment Company Act of
1940, as amended.
(bb) None of the Directed Shares (as defined below) distributed in
connection with the Directed Share Program (as defined below) will be offered or
sold outside of the United States.
(cc) There are no contracts, agreements or understandings between the
Company and any person that would give rise to a valid claim against the Company
or any Underwriter for a brokerage commission, finder's fee or other like
payment in connection with this offering.
(dd) The statistical and market-related data included in the Prospectus
and the Registration Statement are based on or derived from sources which the
Company believes to be reliable and accurate.
(ee) The Company has established and maintains disclosure controls and
procedures (as such term is defined in Rule 13a-15(e) under the Exchange Act),
which (i) are designed to ensure that material information relating to the
Company, including its consolidated subsidiaries, is made known to the Company's
principal executive officer and its principal financial officer by others within
those entities, particularly during the periods in which periodic reports
required under the Exchange Act will be required to be prepared when the Company
has periodic reporting obligations under the Exchange Act; (ii) have been
evaluated for effectiveness; and (iii) are effective in all material respects to
perform the functions for which they were established.
SECTION 2. Representations, Warranties and Agreements of the Selling
Stockholders. Each Selling Stockholder, except for entities affiliated with
Insight Venture Associates III, LLC, severally, but not jointly, represents and
warrants to, and agrees with, the Underwriters that:
(a) Such Selling Stockholder has placed in custody under a custody
agreement and power of attorney (the "CUSTODY AGREEMENT AND POWER OF ATTORNEY"
and, together with all other similar agreements executed by the other Selling
Stockholders, the "CUSTODY AGREEMENTS AND POWERS OF ATTORNEY") with [name of
custodian], as custodian (the "CUSTODIAN"), for delivery under this Agreement,
certificates in negotiable form (with signature guaranteed by a commercial bank
or trust company having an office or correspondent in the United States or a
member firm of the New York or American Stock Exchanges) representing the shares
of Stock to be sold by such Selling Stockholder hereunder.
(b) Such Selling Stockholder has duly and irrevocably executed and
delivered a Custody Agreement and Power of Attorney appointing one or more
persons, as attorneys-in-fact, with full power of substitution, and with full
authority (exercisable by any one or more of them) to execute and deliver this
Agreement and to take such other action as may be necessary or desirable to
carry out the provisions hereof on behalf of such Selling Stockholder.
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Each Selling Shareholder severally, but not jointly, represents and
warrants to, and agrees with, the Underwriters that:
(c) The Selling Stockholder has good and valid title to the shares of
Stock, or securities convertible or exercisable into such shares of Stock, to be
sold by the Selling Stockholder hereunder on such date, and immediately prior to
the First Delivery Date (as defined in Section 5 hereof) the Selling Stockholder
will have good and valid title to the shares of Stock, in each case, free and
clear of all liens, encumbrances, equities or claims; and upon delivery of such
shares and payment therefor pursuant hereto, good and valid title to such
shares, free and clear of all liens, encumbrances, equities or claims, will pass
to the several Underwriters.
(d) The Selling Stockholder has full right, power and authority to enter
into this Agreement, and the Custody Agreement and Power of Attorney, where
applicable; the execution, delivery and performance of this Agreement, and the
Custody Agreement and the Power of Attorney, where applicable, by the Selling
Stockholder and the consummation by the Selling Stockholder of the transactions
contemplated hereby and thereby will not (i) conflict with or result in a breach
or violation of any of the terms or provisions of, or constitute a default
under, any indenture, mortgage, deed of trust, loan agreement or other agreement
or instrument to which the Selling Stockholder is a party or by which the
Selling Stockholder is bound or to which any of the property or assets of the
Selling Stockholder is subject, nor will such actions (ii) result in any
violation of the provisions of the charter, by-laws, the articles of partnership
or any other organizational document of the Selling Stockholder (if such Selling
Stockholder is not a natural person) or (iii) result in any violation of the
provisions of any statute or any order, rule or regulation of any court or
governmental agency or body having jurisdiction over the Selling Stockholder or
the property or assets of the Selling Stockholder, except in the case of clause
(i) and (iii) above where such conflicts, breaches, violations and defaults
could not reasonably be expected to materially adversely affect such Selling
Stockholder's ability to perform its obligations hereunder and under the Custody
Agreement and Power of Attorney, as applicable; and except for the registration
of the Stock under the Securities Act and such consents, approvals,
authorizations, registrations or qualifications as may be required under the
Exchange Act and applicable state securities laws in connection with the
purchase and distribution of the Stock by the Underwriters, no consent,
approval, authorization or order of, or filing or registration with, any such
court or governmental agency or body is required for the execution, delivery and
performance of this Agreement, the Custody Agreement and the Power of Attorney
by the Selling Stockholder and the consummation by the Selling Stockholder of
the transactions contemplated hereby and thereby.
(e) The information with respect to such Selling Stockholder contained in
the Registration Statement and the Prospectus and any further amendments or
supplements to the Registration Statement or the Prospectus that is based upon
information furnished in writing to the Company by such Selling Stockholder
expressly for use therein does not contain any untrue statement of a material
fact or omit to state any material fact required to be stated therein or
necessary to make the statements therein not misleading in the case of the
Registration Statement, and, in the case of the Prospectus only, not misleading
in light of the circumstances under which they were made.
(f) The Selling Stockholder has not taken and will not take, directly or
indirectly, any action which is designed to or which has constituted or which
might reasonably be expected to cause or result in the stabilization or
manipulation of the price of any security of the Company to facilitate the sale
or resale of the shares of the Stock.
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SECTION 3. Purchase of the Stock by the Underwriters. On the basis of the
representations and warranties contained in, and subject to the terms and
conditions of, this Agreement, the Company agrees to sell [ ] shares of the Firm
Stock and each Selling Stockholder hereby agrees, severally and not jointly, to
sell the number of shares of the Firm Stock set opposite such Selling
Stockholder's name in Schedule 2 hereto, severally and not jointly, to the
several Underwriters and each of the Underwriters, severally and not jointly,
agrees to purchase the number of shares of the Firm Stock set forth opposite
that Underwriter's name in Schedule 1 hereto. Each Underwriter shall be
obligated to purchase from the Company, and from each Selling Stockholder, that
number of shares of the Firm Stock which represents the same proportion of the
number of shares of the Firm Stock to be sold by the Company, and by each
Selling Stockholder, as the number of shares of the Firm Stock set forth
opposite the name of such Underwriter in Schedule 1 represents of the total
number of shares of the Firm Stock to be purchased by all of the Underwriters
pursuant to this Agreement. The respective purchase obligations of the
Underwriters with respect to the Firm Stock shall be rounded among the
Underwriters to avoid fractional shares, as the Representatives may determine.
In addition, on the basis of the representations and warranties contained
in, and subject to the terms and conditions of, this Agreement each Selling
Stockholder, severally and not jointly, grants to the Underwriters an option to
purchase up to [ ] shares of Option Stock, as set forth opposite such Selling
Stockholder's name in Schedule 2 hereto. In the event that the Underwriters
exercise their option in part but not in full, each Selling Stockholder shall
sell severally that number of shares of Option Stock which represents the same
proportion of the total number of shares of Option Stock to be purchased by the
Underwriters, as the number of shares of Option Stock set forth opposite the
name of such Selling Stockholder in Schedule 2 hereto represents of the total
number of shares of Option Stock set forth on such Schedule 2. Such option is
granted for the purpose of covering over-allotments in the sale of Firm Stock
and is exercisable as provided in Section 5 hereof. Shares of Option Stock shall
be purchased severally for the account of the Underwriters in proportion to the
number of shares of Firm Stock set forth opposite the name of such Underwriters
in Schedule 1 hereto. The respective purchase obligations of each Underwriter
with respect to the Option Stock shall be adjusted by the Representatives so
that no Underwriter shall be obligated to purchase Option Stock other than in
100 share amounts.
The price to be paid by the Underwriters to the Company and each of the
Selling Stockholders for both the Firm Stock and any Option Stock shall be $ [ ]
per share.
The Company and the Selling Stockholders shall not be obligated to deliver
any of the Stock to be delivered on any Delivery Date (as hereinafter defined),
except upon payment for all the Stock to be purchased on such Delivery Date as
provided herein.
SECTION 4. Offering of Stock by the Underwriters. Upon authorization by the
Representatives of the release of the Firm Stock, the several Underwriters
propose to offer the Firm Stock for sale upon the terms and conditions set forth
in the Prospectus.
It is understood that [ ] shares of the Firm Stock ("DIRECTED SHARES")
will initially be reserved by the Underwriters for offer and sale to employees
and persons having business relationships with the Company ("DIRECTED SHARE
PARTICIPANTS") upon the terms and conditions set forth in the Prospectus (the
"DIRECTED SHARE PROGRAM") and in accordance with the rules and regulations of
the National Association of Securities Dealers, Inc. ("NASD"), and that any
allocation of such Directed Shares among such persons will be made in accordance
with timely directions received by Xxxxxx Brothers Inc. from the Company. Under
no circumstances will
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Xxxxxx Brothers Inc. or any Underwriter be liable to the Company or to any
Directed Share Participant for any action taken or omitted to be taken in good
faith in connection with such Directed Share Program (it being understood that
this does not relieve Xxxxxx Brothers Inc. of its obligation to deliver a
Prospectus to each of the Directed Share Participants). To the extent that any
Directed Shares are not affirmatively reconfirmed for purchase by any Directed
Share Participant on or immediately after the date of this Agreement, such
Directed Shares may be offered to the public as part of the public offering
contemplated hereby.
SECTION 5. Delivery of and Payment for the Stock. Delivery of and payment for
the Firm Stock shall be made at the offices of Xxxx, Weiss, Rifkind, Xxxxxxx &
Xxxxxxxx LLP, 0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000-0000, at
10:00 A.M., New York City time, on the fourth full business day following the
date of this Agreement or at such other date or place as shall be determined by
agreement between the Representatives and the Company. This date and time are
sometimes referred to as the "FIRST DELIVERY DATE." On the First Delivery Date,
the Company and the Selling Stockholders shall deliver or cause to be delivered
certificates representing the Firm Stock to the Representatives for the account
of each Underwriter against payment to or upon the order of the Company and the
Selling Stockholders of the purchase price by wire transfer in immediately
available funds. Time shall be of the essence, and delivery at the time and
place specified pursuant to this Agreement is a further condition of the
obligation of each Underwriter hereunder. Upon delivery, the Firm Stock shall be
registered in such names and in such denominations as the Representatives shall
request in writing not less than two full business days prior to the First
Delivery Date. For the purpose of expediting the checking and packaging of the
certificates for the Firm Stock, the Company and the Selling Stockholders shall
make the certificates representing the Firm Stock available for inspection by
the Representatives in New York, New York, not later than 2:00 P.M., New York
City time, on the business day prior to the First Delivery Date.
The option granted in Section 3 will expire 30 days after the date of this
Agreement and may be exercised in whole or in part from time to time by written
notice being given to the Selling Stockholders or their respective
Attorneys-in-Fact under the Powers of Attorney by the Representatives. Such
notice shall set forth the aggregate number of shares of Option Stock as to
which the option is being exercised, the names in which the shares of Option
Stock are to be registered, the denominations in which the shares of Option
Stock are to be issued and the date and time, as determined by the
Representatives, when the shares of Option Stock are to be delivered; provided,
however, that this date and time shall not be earlier than the First Delivery
Date nor earlier than the second business day after the date on which the option
shall have been exercised nor later than the fifth business day after the date
on which the option shall have been exercised. The date and time the shares of
Option Stock are delivered are sometimes referred to as a "SECOND DELIVERY DATE"
and the First Delivery Date and any Second Delivery Date are sometimes each
referred to as a "DELIVERY DATE". Any such election to purchase Option Stock
shall be made in proportion to the maximum number of shares of Option Stock each
Selling Stockholder may sell as a set forth in Schedule 2 hereto.
Delivery of and payment for the Option Stock shall be made at the place
specified in the first sentence of the first paragraph of this Section 5 (or at
such other place as shall be determined by agreement between the Representatives
and the Selling Stockholders) at 10:00 A.M., New York City time, on each Second
Delivery Date. On each Second Delivery Date, each of the Selling Stockholders
shall deliver or cause to be delivered the certificates representing the Option
Stock to the Representatives for the account of each Underwriter against payment
to or upon the order of each of the Selling Stockholders of the purchase price
by wire transfer in immediately available funds. Time shall be of the essence,
and delivery at the time and place specified
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pursuant to this Agreement is a further condition of the obligation of each
Underwriter hereunder. Upon delivery, the Option Stock shall be registered in
such names and in such denominations as the Representatives shall request in the
aforesaid written notice. For the purpose of expediting the checking and
packaging of the certificates for the Option Stock, each of the Selling
Stockholders shall make the certificates representing the Option Stock available
for inspection by the Representatives in New York, New York, not later than 2:00
P.M., New York City time, on the business day prior to such Second Delivery
Date.
SECTION 6. Further Agreements of the Company. The Company covenants and agrees:
(a) To prepare the Prospectus in a form approved by the Representatives
and to file such Prospectus pursuant to Rule 424(b) under the Securities Act not
later than the Commission's close of business on the second business day
following the execution and delivery of this Agreement or, if applicable, such
earlier time as may be required by Rule 430A(a)(3) under the Securities Act; to
make no further amendment or any supplement to the Registration Statement or to
the Prospectus except in compliance with the terms hereof; to advise the
Representatives, promptly after it receives notice thereof, of the time when any
amendment to the Registration Statement has been filed or becomes effective or
any supplement to the Prospectus or any amended Prospectus has been filed and to
furnish the Representatives with copies thereof; to advise the Representatives,
promptly after it receives notice thereof, of the issuance by the Commission of
any stop order or of any order preventing or suspending the use of any
Preliminary Prospectus or the Prospectus, of the suspension of the qualification
of the Stock for offering or sale in any jurisdiction, of the initiation or
threatening of any proceeding for any such purpose, or of any request by the
Commission for the amending or supplementing of the Registration Statement or
the Prospectus or for additional information; and, in the event of the issuance
of any stop order or of any order preventing or suspending the use of any
Preliminary Prospectus or the Prospectus or suspending any such qualification,
to use its best efforts to obtain promptly its withdrawal;
(b) To furnish promptly to each of the Representatives and to counsel for
the Underwriters a signed copy of the Registration Statement as originally filed
with the Commission, and each amendment thereto filed with the Commission,
including all consents and exhibits filed therewith;
(c) To deliver promptly to the Representatives such number of the
following documents as the Representatives shall reasonably request: (i)
conformed copies of the Registration Statement as originally filed with the
Commission and each amendment thereto (in each case excluding exhibits) and (ii)
each Preliminary Prospectus, the Prospectus and any amended or supplemented
Prospectus; and, if the delivery of a prospectus is required at any time after
the Effective Time in connection with the offering or sale of the Stock or any
other securities relating thereto and if at such time any events shall have
occurred as a result of which the Prospectus as then amended or supplemented
would include an untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made when such Prospectus is delivered,
not misleading, or, if for any other reason it shall be necessary to amend or
supplement the Prospectus in order to comply with the Securities Act, to notify
the Representatives and, upon their request, to file such document and to
prepare and furnish without charge to each Underwriter and to any dealer in
securities as many copies as the Representatives may from time to time
reasonably request of an amended or supplemented Prospectus which will correct
such statement or omission or effect such compliance;
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(d) To file promptly with the Commission any amendment to the Registration
Statement or the Prospectus or any supplement to the Prospectus that may, in the
reasonable judgment of the Company or the Representatives, be required by the
Securities Act or requested by the Commission;
(e) Prior to filing with the Commission any amendment to the Registration
Statement or supplement to the Prospectus or any Prospectus pursuant to Rule 424
of the Rules and Regulations, to furnish a copy thereof to the Representatives
and counsel for the Underwriters and obtain the consent of the Representatives
to the filing;
(f) As soon as practicable after the Effective Date, to make generally
available to the Company's security holders and to deliver to the
Representatives an earnings statement of the Company and its subsidiaries
covering a period of at least twelve months beginning with the first fiscal
quarter of the Company occurring after the Effective Date (which need not be
audited) complying with Section 11(a) of the Securities Act and the Rules and
Regulations (including, at the option of the Company, Rule 158);
(g) At the request of the Representative, for a period of five years
following the Effective Date, to furnish to the Representatives copies of all
materials furnished by the Company to its stockholders and all reports and
financial statements furnished by the Company to the principal national
securities exchange upon which the Common Stock may be listed pursuant to
requirements of or agreements with such exchange or to the Commission pursuant
to the Exchange Act or any rule or regulation of the Commission thereunder,
other than materials that are promptly made available through the Commission's
Electronic Data Gathering Analysis and Retrieval System ("XXXXX");
(h) Promptly from time to time to take such action as the Representatives
may reasonably request to qualify the Stock for offering and sale under the
securities laws of such jurisdictions as the Representatives may request and to
comply with such laws so as to permit the continuance of sales and dealings
therein in such jurisdictions for as long as may be necessary to complete the
distribution of the Stock; provided that in connection therewith the Company
shall not be required to qualify as a foreign corporation or to file a general
consent to service of process in any jurisdiction;
(i) For a period of 180 days from the date of the Prospectus, not to,
directly or indirectly, (1) offer for sale, sell, pledge or otherwise dispose of
(or enter into any transaction or device which is designed to, or could be
expected to, result in the disposition by any person at any time in the future
of) any shares of Common Stock or securities convertible into or exchangeable
for Common Stock (other than (i) the Stock, (ii) shares issued pursuant to
employee benefit plans, qualified stock option plans or other employee
compensation or incentive plans existing on the date hereof, (iii) shares issued
pursuant to currently outstanding options, warrants or rights, or (iv) shares of
Common Stock or securities convertible into or exchangeable for shares of Common
Stock issued by the Company in exchange (either solely or together with other
consideration) for assets or a majority and controlling portion of the equity of
another person in connection with a merger or acquisition (each, a "STRATEGIC
TRANSACTION"), provided that (A) such securities are not issued in a transaction
publicly announced within ninety (90) days of the date of the Prospectus, (B)
the recipients of such securities shall have furnished to the Representatives,
prior to any such issuance, a Lock-Up Letter (as defined below) and (C) the
aggregate number of shares of Common Stock issuable by the Company in all such
issuances shall not exceed five percent (5%) of the shares of Common Stock
issued and outstanding immediately following the First Delivery Date hereunder
(collectively the "STRATEGIC
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TRANSACTION RESTRICTIONS")), or sell or grant options, rights or warrants with
respect to any shares of Common Stock or securities convertible into or
exchangeable for Common Stock (other than (i) the grant of options, rights,
warrants with respect to any shares of Common Stock or securities convertible
into or exchangeable for shares of Common Stock issued pursuant to employee
benefit plans, qualified stock options plans or other employee compensation or
incentive plans existing on the date hereof, or (ii) options, rights or warrants
with respect to any shares of Common Stock or securities convertible into or
exchangeable for shares of Common Stock issued in connection with a Strategic
Transaction, subject to the Strategic Transaction Restrictions), or (2) enter
into any swap or other derivatives transaction that transfers to another, in
whole or in part, any of the economic benefits or risks of ownership of such
shares of Common Stock (except as otherwise permitted in the foregoing clause
(1)), whether any such transaction described in clause (1) or (2) above is to be
settled by delivery of Common Stock or other securities, in cash or otherwise,
in each case without the prior written consent of Xxxxxx Brothers Inc. on behalf
of the Underwriters; and (i) to cause each officer, director and employee of the
Company, each Directed Share Participant and each stockholder of the Company
holding at least one percent (1%) of the outstanding Common Stock on the First
Delivery Date and (ii) to use its best efforts to cause each other stockholder
of the Company to furnish to the Representatives, prior to the First Delivery
Date, a letter or letters, substantially in the form of Exhibit A hereto (each ,
a "LOCK-UP LETTER"), pursuant to which each such person shall agree not to,
directly or indirectly, (1) offer for sale, sell, pledge or otherwise dispose of
(or enter into any transaction or device which is designed to, or could be
expected to, result in the disposition by any person at any time in the future
of) any shares of Common Stock or securities convertible into or exchangeable
for Common Stock (other than the Stock) or (2) enter into any swap or other
derivatives transaction that transfers to another, in whole or in part, any of
the economic benefits or risks of ownership of such shares of Common Stock,
whether any such transaction described in clause (1) or (2) above is to be
settled by delivery of Common Stock or other securities, in cash or otherwise,
in each case for a period of 180 days from the date of the Prospectus, without
the prior written consent of Xxxxxx Brothers Inc.; provided that,
notwithstanding the foregoing clause (ii), the failure of holders of up to a
maximum of 5% in the aggregate of the Common Stock outstanding on the First
Delivery Date to furnish such letters shall not constitute a violation by the
Company of this clause (ii);
(j) Prior to the Effective Date, to apply for the quotation of the Stock
on the Nasdaq National Market System, and to use its best efforts to effect that
quotation, subject only to official notice of issuance and evidence of
satisfactory distribution, prior to the First Delivery Date;
(k) To apply the net proceeds from the sale of the Stock being sold by the
Company as set forth in the Prospectus in all material respects;
(l) To take such steps as shall be necessary to ensure that neither the
Company nor any subsidiary shall become an "investment company" as defined in
the Investment Company Act of 1940, as amended and the rules and regulations of
the Commission thereunder;
(m) In connection with the Directed Share Program, to ensure that the
Directed Shares will be restricted to the extent required by the NASD or the
rules of such association from sale, transfer, assignment, pledge or
hypothecation for a period of three months following the date of the
effectiveness of the Registration Statement, and Xxxxxx Brothers Inc. will
notify the Company as to which Directed Share Participants will need to be so
restricted. At the request of Xxxxxx Brothers Inc., the Company will direct the
transfer agent to place stop transfer restrictions upon such securities for such
period of time; and
13
(n) To comply with all applicable securities and other applicable laws,
rules and regulations in each foreign jurisdiction in which the Directed Shares
are offered in connection with the Directed Share Program.
SECTION 7. Further Agreements of the Selling Stockholders. Each Selling
Stockholder agrees:
(a) For a period of 180 days from the date of the Prospectus, not to,
directly or indirectly, (1) offer for sale, sell, pledge or otherwise dispose of
(or enter into any transaction or device which is designed to, or could be
expected to, result in the disposition by any person at any time in the future
of) any shares of Common Stock or securities convertible into or exchangeable
for Common Stock (other than the Stock) or (2) enter into any swap or other
derivatives transaction that transfers to another, in whole or in part, any of
the economic benefits or risks of ownership of such shares of Common Stock,
whether any such transaction described in clause (1) or (2) above is to be
settled by delivery of Common Stock or other securities, in cash or otherwise,
in each case without the prior written consent of Xxxxxx Brothers Inc. on behalf
of the Underwriters.
(b) That the Stock to be sold by the Selling Stockholder hereunder, which
is represented by the certificates held in custody for the Selling Stockholder,
is subject to the interest of the Underwriters and the other Selling
Stockholders thereunder, that the arrangements made by the Selling Stockholder
for such custody are to that extent irrevocable, and that the obligations of the
Selling Stockholder hereunder shall not be terminated by any act of the Selling
Stockholder, by operation of law by the death or incapacity of any individual
Selling Stockholder or the occurrence of any other event.
(c) To deliver to the Representatives prior to the First Delivery Date a
properly completed and executed United States Treasury Department Form W-8 (if
the Selling Stockholder is a non-United States person) or Form W-9 (if the
Selling Stockholder is a United States person).
SECTION 8. Expenses. The Company agrees to pay (a) the costs incident to the
authorization, issuance, sale and delivery of the Stock and any taxes payable in
that connection; (b) the costs incident to the preparation, printing and filing
under the Securities Act of the Registration Statement and any amendments and
exhibits thereto; (c) the costs of distributing the Registration Statement as
originally filed and each amendment thereto and any post-effective amendments
thereof (including, in each case, exhibits), any Preliminary Prospectus, the
Prospectus and any amendment or supplement to the Prospectus, all as provided in
this Agreement; (d) the costs of producing and distributing this Agreement, any
supplemental agreement among the Underwriters and any other related documents in
connection with the offering, purchase, sale and delivery of the stock,
including the Custody Agreements and the Powers of Attorney; (e) the filing fees
incident to securing the review by the NASD of the terms of sale of the Stock;
(f) any applicable listing or other fees; (g) the fees and expenses of
qualifying the Stock under the securities laws of the several jurisdictions as
provided in Section 6(h) and of preparing, printing and distributing a Blue Sky
Memorandum (including related fees and expenses of counsel to the Underwriters
not to exceed $18,000); (h) all costs and expenses of the Underwriters,
including the fees and disbursements of counsel for the Underwriters, incident
to the Directed Share Program described in Section 4; (i) the costs and expenses
of the Company relating to investor presentations on any "road show" undertaken
in connection with the marketing of the offering of the Stock, including,
without limitation, expenses associated with the production of road show slides
and graphics, fees and expenses of
14
any consultants engaged in connection with the road show presentations with the
prior approval of the Company, travel and lodging expenses of the
representatives and officers of the Company and any such consultants, and the
cost of any aircraft chartered in connection with the road show and (j) all
other costs and expenses incident to the performance of the obligations of the
Company and the Selling Stockholders under this Agreement; provided that, except
as provided in this Section 8 and in Section 13 the Underwriters shall pay their
own costs and expenses, including the costs and expenses of their counsel, any
transfer taxes on the Stock which they may sell and the expenses of advertising
any offering of the Stock made by the Underwriters.
SECTION 9. Conditions of Underwriters' Obligations. The respective obligations
of the Underwriters hereunder are subject to the accuracy, when made and on each
Delivery Date, of the representations and warranties of the Company and the
Selling Stockholders contained herein, to the performance by the Company and the
Selling Stockholders of their respective obligations hereunder, and to each of
the following additional terms and conditions:
(a) The Prospectus shall have been timely filed with the Commission in
accordance with Section 6(a); no stop order suspending the effectiveness of the
Registration Statement or any part thereof shall have been issued and no
proceeding for that purpose shall have been initiated or threatened by the
Commission; and any request of the Commission for inclusion of additional
information in the Registration Statement or the Prospectus or otherwise shall
have been complied with.
(b) No Underwriter shall have discovered and disclosed to the Company on
or prior to such Delivery Date that the Registration Statement or the Prospectus
or any amendment or supplement thereto contains an untrue statement of a fact
which, in the opinion of Xxxx, Weiss, Rifkind, Xxxxxxx & Xxxxxxxx, LLP, counsel
for the Underwriters, is material or omits to state a fact which, in the opinion
of such counsel, is material and is required to be stated therein or is
necessary to make the statements therein not misleading.
(c) All corporate proceedings and other legal matters incident to the
authorization, form and validity of this Agreement, the Custody Agreements, the
Powers of Attorney, the Stock, the Registration Statement and the Prospectus,
and all other legal matters relating to this Agreement and the transactions
contemplated hereby shall be reasonably satisfactory in all material respects to
counsel for the Underwriters, and the Company and the Selling Stockholders shall
have furnished to such counsel all documents and information that they may
reasonably request to enable them to pass upon such matters.
(d) Xxxxxxx Xxxxx & Xxxxx LLP shall have furnished to the Representatives
its written opinion, as counsel to the Company, addressed to the Underwriters
and dated such Delivery Date, in the form attached as Exhibit 9(d) hereto.
(e) Xxxxxxxx Chance US LLP shall have furnished to the Representatives its
written opinion, as counsel to each of the Selling Stockholders except for UBS
Capital II LLC, addressed to the Underwriters and dated such Delivery Date, in
the form attached as Exhibit 9(e) hereto.
(f) Xxxx Xxxxxxx LLP, counsel to UBS Capital II LLC, and internal counsel
of UBS Capital II LLC, shall have furnished to the Representatives their written
opinions addressed to the Underwriters and dated such Delivery Date, in the
forms attached hereto as Exhibits 9(f)-I and 9(f)-II, respectively.
15
(g) The Representatives shall have received from Xxxx, Weiss, Rifkind,
Xxxxxxx & Xxxxxxxx LLP, counsel for the Underwriters, such opinion or opinions,
dated such Delivery Date, with respect to the issuance and sale of the Stock,
the Registration Statement, the Prospectus and other related matters as the
Representatives may reasonably require, and the Company shall have furnished to
such counsel such documents as they reasonably request for the purpose of
enabling them to pass upon such matters.
(h) At the time of execution of this Agreement, the Representatives shall
have received from PricewaterhouseCoopers, LLP a letter, in form and substance
satisfactory to the Representatives, addressed to the Underwriters and [each
Selling Stockholder,] dated the date hereof (i) confirming that they are
independent public accountants within the meaning of the Securities Act and are
in compliance with the applicable requirements relating to the qualification of
accountants under Rule 2-01 of Regulation S-X of the Commission and (ii)
stating, as of the date hereof (or, with respect to matters involving changes or
developments since the respective dates as of which specified financial
information is given in the Prospectus, as of a date not more than five days
prior to the date hereof), the conclusions and findings of such firm with
respect to the financial information and other matters ordinarily covered by
accountants' "comfort letters" to underwriters in connection with registered
public offerings.
(i) With respect to the letter of PricewaterhouseCoopers, LLP referred to
in the preceding paragraph and delivered to the Representatives concurrently
with the execution of this Agreement (the "INITIAL LETTER"), the Company shall
have furnished to the Representatives [and the Selling Stockholders] a letter
(the "BRING-DOWN LETTER") of such accountants, addressed to the Underwriters and
[the Selling Stockholders and] dated such Delivery Date (i) confirming that they
are independent public accountants within the meaning of the Securities Act and
are in compliance with the applicable requirements relating to the qualification
of accountants under Rule 2-01 of Regulation S-X of the Commission, (ii)
stating, as of the date of the bring-down letter (or, with respect to matters
involving changes or developments since the respective dates as of which
specified financial information is given in the Prospectus, as of a date not
more than five days prior to the date of the bring-down letter), the conclusions
and findings of such firm with respect to the financial information and other
matters covered by the initial letters and (iii) confirming in all material
respects the conclusions and findings set forth in the initial letters.
(j) The Company shall have furnished to the Representatives a certificate,
dated such Delivery Date, of its Chairman of the Board, its President, Chief
Executive Officer or a Vice President and its Chief Financial Officer stating
that:
(i) The representations, warranties and agreements of the Company in
Section 1 are true and correct as of such Delivery Date; the Company has
complied with all its agreements contained herein; and the conditions set forth
in Sections 9(a) and 9(k) have been fulfilled; and
(ii) They have carefully examined the Registration Statement and the
Prospectus and, in their opinion (A) as of the Effective Date, the Registration
Statement and Prospectus did not include any untrue statement of a material fact
and did not omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, and (B) since the
Effective Date no event has occurred which should have been set forth in a
supplement or amendment to the Registration Statement or the Prospectus which
has not been so set forth.
16
(k) Each Selling Stockholder (or the Custodian or one or more
attorneys-in-fact on behalf of the Selling Stockholders) shall have furnished to
the Representatives on such Delivery Date a certificate, dated such Delivery
Date, signed by, or on behalf of, the Selling Stockholder (or the Custodian or
one or more attorneys-in-fact) stating that the representations, warranties and
agreements of the Selling Stockholder contained herein are true and correct as
of such Delivery Date and that the Selling Stockholder has complied with all
agreements contained herein to be performed by the Selling Stockholder at or
prior to such Delivery Date.
(l) Neither the Company nor any of its subsidiaries shall have sustained
since the date of the latest audited financial statements included in the
Prospectus (A) any loss or interference with its business from fire, explosion,
flood or other calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree, otherwise than as set
forth or contemplated in the Prospectus or (B) since such date, there shall not
have been any change in the capital stock or long-term debt of the Company or
any of its subsidiaries or any change, or any development involving a
prospective change, in or affecting the general affairs, management, financial
position, stockholders' equity or results of operations of the Company and its
subsidiaries, otherwise than as set forth or contemplated in the Prospectus, the
effect of which, in any such case described in clause (A) or (B), is, in the
judgment of the Representatives, so material and adverse as to make it
impracticable or inadvisable to proceed with the public offering or the delivery
of the Stock being delivered on such Delivery Date on the terms and in the
manner contemplated in the Prospectus.
(m) Subsequent to the execution and delivery of this Agreement there shall
not have occurred any of the following: (i) trading in securities generally on
the New York Stock Exchange or the American Stock Exchange or in the
over-the-counter market, or trading in any securities of the Company on any
exchange or in the over-the-counter market, shall have been suspended or
materially limited or the settlement of such trading generally shall have been
materially disrupted or minimum prices shall have been established on any such
exchange or such market by the Commission, by such exchange or by any other
regulatory body or governmental authority having jurisdiction, (ii) a banking
moratorium shall have been declared by Federal or any state authority, (iii) the
United States shall have become engaged in hostilities [(other than the military
operations of the United States in Iraq)], there shall have been an escalation
in hostilities involving the United States or there shall have been a
declaration of a national emergency or war by the United States or there shall
have occurred any other calamity or crisis or (iv) there shall have occurred
such a material adverse change in general economic, political or financial
conditions, including, without limitation, as a result of terrorist activities
after the date hereof, (or the effect of international conditions on the
financial markets in the United States shall be such) as to make it, in the
judgment of the Representatives, impracticable or inadvisable to proceed with
the public offering or delivery of the Stock being delivered on such Delivery
Date on the terms and in the manner contemplated in the Prospectus.
(n) The Nasdaq National Market System shall have approved the Stock for
quotation, subject only to official notice of issuance and evidence of
satisfactory distribution.
All opinions, letters, evidence and certificates mentioned above or
elsewhere in this Agreement shall be deemed to be in compliance with the
provisions hereof only if they are in form and substance reasonably satisfactory
to counsel for the Underwriters.
17
SECTION 10. Indemnification and Contribution.
(a) The Company shall indemnify and hold harmless each Underwriter, its
directors, officers, employees, partners, members and agents and each person, if
any, who controls any Underwriter within the meaning of the Securities Act, from
and against any loss, claim, damage or liability, joint or several, or any
action in respect thereof (including, but not limited to, any loss, claim,
damage, liability or action relating to purchases and sales of Stock), to which
that Underwriter, director, officer, employee, partner, member, agent or
controlling person may become subject, under the Securities Act or otherwise,
insofar as such loss, claim, damage, liability or action arises out of, or is
based upon, (i) any untrue statement or alleged untrue statement of a material
fact contained (A) in any Preliminary Prospectus, the Registration Statement or
the Prospectus or in any amendment or supplement thereto or (B) in any materials
or information provided to investors by, or with the approval of, the Company in
connection with the marketing of the offering of the Stock, including any
roadshow or investor presentations made to investors by the Company (whether in
person or electronically) (the "MARKETING MATERIALS"), (ii) the omission or
alleged omission to state in any Preliminary Prospectus, the Registration
Statement or the Prospectus, or in any amendment or supplement thereto, or in
any Marketing Materials, any material fact required to be stated therein or
necessary to make the statements therein not misleading or (iii) any act or
failure to act or any alleged act or failure to act by any Underwriter in
connection with, or relating in any manner to, the Stock or the offering
contemplated hereby, and which is included as part of or referred to in any
loss, claim, damage, liability or action 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 that it is determined in a final
judgment by a court of competent jurisdiction that such loss, claim, damage,
liability or action 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), and shall reimburse each Underwriter and each
such director, officer, employee, partner, member, agent or controlling person
promptly upon demand for any legal or other expenses reasonably incurred by that
Underwriter, director, officer, employee, partner, member, agent or controlling
person in connection with investigating or defending or preparing to defend
against any such loss, claim, damage, liability or action as such expenses are
incurred; provided, however, that the Company shall not be liable in any such
case to the extent (1) that any such loss, claim, damage, liability or action
arises out of, or is based upon, any untrue statement or alleged untrue
statement or omission or alleged omission made in any Preliminary Prospectus,
the Registration Statement or the Prospectus, or in any such amendment or
supplement, in reliance upon and in conformity with written information
concerning such Underwriter furnished to the Company through the Representatives
by or on behalf of any Underwriter specifically for inclusion therein which
information consists solely of the information specified in Section 10(f) and
(2) that any such loss, claim, damage, liability or expense of such Underwriter
results from the fact that such Underwriter sold Stock to a person and there was
not sent or given to such person, at or prior to the written confirmation of
such sale to such person, to the extent required by law, a copy of the
Prospectus dated the Effective Date (the "FINAL PROSPECTUS") and the loss,
claim, damage, liability or expense of such Underwriter results from an untrue
statement or omission of a material fact contained in the Preliminary Prospectus
previously delivered to such person which was corrected in the Final Prospectus,
unless the Company had not previously furnished copies of the Final Prospectus
to such Underwriter to permit delivery on a timely basis. The foregoing
indemnity agreement is in addition to any liability which the Company may
otherwise have to any Underwriter or to any director, officer, employee,
partner, member, agent or controlling person of that Underwriter.
18
The Company agrees to indemnify and hold harmless Xxxxxx Brothers Inc.
(including its officers and employees) and each person, if any, who controls
Xxxxxx Brothers Inc. within the meaning of the Securities Act ("XXXXXX BROTHERS
ENTITIES"), from and against any loss, claim, damage or liability or any action
in respect thereof to which any of the Xxxxxx Brothers Entities may become
subject, under the Securities Act or otherwise, insofar as such loss, claim,
damage, liability or action (i) arises out of, or is based upon, any untrue
statement or alleged untrue statement of a material fact contained in any
material prepared by or with the approval of the Company for distribution to
Directed Share Participants in connection with the Directed Share Program or any
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, (ii)
arises out of, or is based upon, the failure of the Directed Share Participant
to pay for and accept delivery of Directed Shares that the Directed Share
Participant agreed to purchase or (iii) is otherwise related to the Directed
Share Program, other than losses, finally judicially determined to have resulted
directly from the bad faith or gross negligence of Xxxxxx Brothers Inc. The
Company shall reimburse the Xxxxxx Brothers Entities promptly upon demand for
any legal or other expenses reasonably incurred by them in connection with
investigating or defending or preparing to defend against any such loss, claim,
damage, liability or action as such expenses are incurred.
(b) The Selling Stockholders severally, in proportion to the number of
shares of Stock to be sold by each of them hereunder, and not jointly shall
indemnify and hold harmless each Underwriter, its officers and employees, and
each person, if any, who controls any Underwriter within the meaning of the
Securities Act, from and against any loss, claim, damage or liability, joint or
several, or any action in respect thereof (including, but not limited to, any
loss, claim, damage, liability or action relating to purchases and sales of
Stock), to which that Underwriter, officer, employee or controlling person may
become subject, under the Securities Act or otherwise, insofar as such loss,
claim, damage, liability or action arises out of, or is based upon, (i) any
untrue statement or alleged untrue statement of a material fact contained in any
Preliminary Prospectus, the Registration Statement or the Prospectus or in any
amendment or supplement thereto or (ii) the omission or alleged omission to
state in any Preliminary Prospectus, Registration Statement or the Prospectus,
or in any amendment or supplement thereto, any material fact required to be
stated therein or necessary to make the statements therein not misleading, and
shall reimburse each Underwriter, its officers and employees and each such
controlling person for any legal or other expenses reasonably incurred by that
Underwriter, its officers and employees or controlling person in connection with
investigating or defending or preparing to defend against any such loss, claim,
damage, liability or action as such expenses are incurred; provided, however,
that such indemnification or reimbursement shall be available in each such case
to the extent, but only to the extent, that such untrue statement or alleged
untrue statement or omission or alleged omission made in any Preliminary
Prospectus, the Registration Statement or the Prospectus or in any such
amendment or supplement thereto was made in reliance upon and in conformity with
written information furnished to the Company or such Underwriter by or on behalf
of and concerning the Selling Stockholder from whom such indemnification is
sought expressly for use in the preparation thereof; provided further that no
Selling Stockholder shall be liable to the extent that any such loss, claim,
damage, liability or action arises out of, or is based upon, any untrue
statement or alleged untrue statement or omission or alleged omission made in
any Preliminary Prospectus, the Registration Statement or the Prospectus or in
any such amendment or supplement in reliance upon and in conformity with written
information concerning such Underwriter furnished to the Company through the
Representatives by or on behalf of any Underwriter specifically for inclusion
therein which information consists solely of the information specified in
Section 10(f). The foregoing indemnity agreement is in addition to any liability
which the Selling Stockholders may otherwise have to any Underwriter or any
officer, employee or controlling person of that Underwriter. Notwithstanding the
provisions of this Section 10(b), the aggregate liability of any Selling
19
Stockholder under this Section 10(b) and Section 10(e) shall not exceed the net
proceeds received by such Selling Stockholder from the sale of shares of Stock
under this Agreement. Each Underwriter acknowledges that (i) the name and
address of each Selling Stockholder in the Prospectus, (ii) the number of shares
of Stock each Selling Stockholder is offering in the Prospectus and (iii) the
information relating to such Selling Stockholder listed in the Prospectus under
the caption "Principal and Selling Stockholders" (including the footnotes
thereto) constitute the only information furnished to the Company or the
Underwriters by or on behalf of each of the Selling Stockholders specifically
for inclusion in the Prospectus, the Preliminary Prospectus, the Registration
Statement or any amendment or supplement thereto.
(c) Each Underwriter, severally and not jointly, shall indemnify and hold
harmless the Company, its officers who have signed the Registration Statement,
each Selling Stockholder, each of the Company's and each of the Selling
Stockholder's partners, members, officers, directors, employees and agents and
each person, if any, who controls the Company, Selling Stockholder within the
meaning of the Securities Act, from and against any loss, claim, damage or
liability, joint or several, or any action in respect thereof, to which the
Company, any Selling Stockholder or any such director, officer or controlling
person may become subject, under the Securities Act or otherwise, insofar as
such loss, claim, damage, liability or action arises out of, or is based upon,
(i) any untrue statement or alleged untrue statement of a material fact
contained in any Preliminary Prospectus, the Registration Statement or the
Prospectus or in any amendment or supplement thereto, or (ii) the omission or
alleged omission to state in any Preliminary Prospectus, the Registration
Statement or the Prospectus, or in any amendment or supplement thereto, any
material fact required to be stated therein or necessary to make the statements
therein not misleading, but in each case only to the extent that the untrue
statement or alleged untrue statement or omission or alleged omission was made
in reliance upon and in conformity with written information concerning such
Underwriter furnished to the Company through the Representatives by or on behalf
of that Underwriter specifically for inclusion therein, which information is
limited to the information set forth in Section 10(f), and shall reimburse the
Company, any Selling Stockholder and any such partner, member, director,
officer, employee, agent or controlling person for any legal or other expenses
reasonably incurred by the Company, any Selling Stockholder or any such
director, officer or controlling person in connection with investigating or
defending or preparing to defend against any such loss, claim, damage, liability
or action as such expenses are incurred. The foregoing indemnity agreement is in
addition to any liability which any Underwriter may otherwise have to the
Company, any Selling Stockholder or any such partner, member, director, officer,
employee, agent or controlling person.
(d) Promptly after receipt by an indemnified party under this Section 10
of notice of any claim or the commencement of any action, the indemnified party
shall, if a claim in respect thereof is to be made against the indemnifying
party under this Section 10, notify the indemnifying party in writing of the
claim or the commencement of that action; provided, however, that the failure to
notify the indemnifying party shall not relieve it from any liability which it
may have under this Section 10 except to the extent it has been materially
prejudiced by such failure and, provided further, that the failure to notify the
indemnifying party shall not relieve it from any liability which it may have to
an indemnified party otherwise than under this Section 10. If any such claim or
action shall be brought against an indemnified party, and it shall notify the
indemnifying party thereof, the indemnifying party shall be entitled to
participate therein and, to the extent that it wishes, jointly with any other
similarly notified indemnifying party, to assume the defense thereof with
counsel reasonably satisfactory to the indemnified party. After notice from the
indemnifying party to the indemnified party of its election to assume the
defense of such claim or action, the indemnifying party shall not be liable to
the indemnified party under this Section 10 for any legal or other expenses
subsequently incurred by the
20
indemnified party in connection with the defense thereof other than reasonable
costs of investigation; provided, however, that the Representatives shall have
the right to employ counsel to represent jointly the Representatives and those
other Underwriters and their respective directors, officers, employees and
controlling persons who may be subject to liability arising out of any claim in
respect of which indemnity may be sought by the Underwriters against the Company
or any Selling Stockholder under this Section 10 if, in the reasonable judgment
of the Representatives, it is advisable for the Representatives and those
Underwriters, directors, officers, employees and controlling persons to be
jointly represented by separate counsel, and in that event the reasonable fees
and expenses of such separate counsel shall be paid by the Company or Selling
Stockholders, as the case may be. Notwithstanding anything contained herein to
the contrary, if indemnity may be sought pursuant to Section 10(a) hereof in
respect of such claim or action, then in addition to such separate firm for the
indemnified parties, the indemnifying party shall be liable for the fees and
expenses of not more than one separate firm (in addition to any local counsel)
for the Xxxxxx Brothers Entities for the defense of any loss, claim, damage,
liability or action arising out of the Directed Share Program. No indemnifying
party shall (i) without the prior written consent of the indemnified parties
(which consent shall not be unreasonably withheld), settle or compromise or
consent to the entry of any judgment with respect to any pending or threatened
claim, action, suit or proceeding in respect of which indemnification or
contribution may be sought hereunder (whether or not the indemnified parties are
actual or potential parties to such claim or action) unless such settlement,
compromise or consent includes an unconditional release of each indemnified
party from all liability arising out of such claim, action, suit or proceeding,
or (ii) be liable for any settlement of any such action effected without its
written consent (which consent shall not be unreasonably withheld), but if
settled with the consent of the indemnifying party or if there be a final
judgment for the plaintiff in any such action, the indemnifying party agrees to
indemnify and hold harmless any indemnified party from and against any loss or
liability by reason of such settlement or judgment, subject to the limitations
on aggregate liability set forth in the penultimate sentence of Section 10(b).
(e) If the indemnification provided for in this Section 10 shall for any
reason be unavailable to or insufficient to hold harmless an indemnified party
under Section 10(a), 10(b) or 10(c) in respect of any loss, claim, damage or
liability, or any action in respect thereof, referred to therein, then each
indemnifying party shall, in lieu of indemnifying such indemnified party,
contribute to the amount paid or payable by such indemnified party as a result
of such loss, claim, damage or liability, or action in respect thereof, (i) in
such proportion as shall be appropriate to reflect the relative benefits
received by the Company and each of the Selling Stockholders on the one hand and
the Underwriters on the other from the offering of the Stock or (ii) if the
allocation provided by clause (i) above is not permitted by applicable law, in
such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault of the Company and
each such Selling Stockholder on the one hand and the Underwriters on the other
with respect to the statements or omissions which resulted in such loss, claim,
damage or liability, or action in respect thereof, as well as any other relevant
equitable considerations. The relative benefits received by the Company or such
Selling Stockholders on the one hand and the Underwriters on the other with
respect to such offering shall be deemed to be in the same proportion as the
total net proceeds from the offering of the Stock purchased under this Agreement
(before deducting expenses) received by the Company or such Selling Stockholder,
on the one hand, and the total underwriting discounts and commissions received
by the Underwriters with respect to the shares of the Stock purchased under this
Agreement, on the other hand, bear to the total gross proceeds from the offering
of the shares of the Stock under this Agreement, in each case as set forth in
the table on the cover page of the Prospectus. The relative fault shall be
determined by reference to whether the untrue or alleged untrue statement of a
21
material fact or omission or alleged omission to state a material fact relates
to information supplied by the Company, such Selling Stockholder or 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, the Selling Stockholders and the Underwriters agree that it would
not be just and equitable if contributions pursuant to this Section 10(e) 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,
damage or liability, or action in respect thereof, referred to above in this
Section shall be deemed to include, for purposes of this Section 10(e), 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 10(e), no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the shares of Stock underwritten by it and distributed to the
public were offered to the public exceeds the amount of any damages which such
Underwriter has otherwise paid or become liable to pay by reason of any untrue
or alleged untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall 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 10(e) are several in proportion to their
respective underwriting obligations and not joint. The Selling Stockholders'
obligations to contribute as provided in this Section 10(e) are several in
proportion to the net proceeds received by them respectively from the sale of
the Stock under this Agreement and not joint, and shall be subject to the
limitations on aggregate liability set forth in the penultimate sentence of
Section 10(b).
(f) The Underwriters severally confirm and the Company and the Selling
Stockholders acknowledge that the statements with respect to the public offering
of the Stock by the Underwriters set forth on the cover page of, the legend
concerning over-allotments on the inside front cover page of, and the concession
and reallowance figures appearing under the caption "Underwriting" in, the
Prospectus are correct and constitute the only information concerning such
Underwriters furnished in writing to the Company by or on behalf of the
Underwriters specifically for inclusion in the Registration Statement and the
Prospectus.
SECTION 11. Defaulting Underwriters.
If, on either Delivery Date, any Underwriter defaults in the performance
of its obligations under this Agreement, the remaining non-defaulting
Underwriters shall be obligated to purchase the Stock which the defaulting
Underwriter agreed but failed to purchase on such Delivery Date in the
respective proportions which the number of shares of the Firm Stock set opposite
the name of each remaining non-defaulting Underwriter in Schedule 1 hereto bears
to the total number of shares of the Firm Stock set opposite the names of all
the remaining non-defaulting Underwriters in Schedule 1 hereto; provided,
however, that the remaining non-defaulting Underwriters shall not be obligated
to purchase any of the Stock on such Delivery Date if the total number of shares
of the Stock which the defaulting Underwriter or Underwriters agreed but failed
to purchase on such date exceeds 9.09% of the total number of shares of the
Stock to be purchased on such Delivery Date, and any remaining non-defaulting
Underwriter shall not be obligated to purchase more than 110% of the number of
shares of the Stock which it agreed to purchase on such Delivery Date pursuant
to the terms of Section 3. If the foregoing maximums are exceeded, the remaining
non-defaulting Underwriters, or those other underwriters satisfactory to the
Representatives who so agree, shall have the right, but shall not be obligated,
to purchase, in such proportion as may be agreed upon among them, all the Stock
to be purchased on such Delivery
22
Date. If the remaining Underwriters or other underwriters satisfactory to the
Representatives do not elect to purchase the shares which the defaulting
Underwriter or Underwriters agreed but failed to purchase on such Delivery Date,
this Agreement (or, with respect to the Second Delivery Date, the obligation of
the Underwriters to purchase, and of the Selling Stockholders to sell, the
Option Stock) shall terminate without liability on the part of any
non-defaulting Underwriter or the Company or the Selling Stockholders, except
that the Company will continue to be liable for the payment of expenses to the
extent set forth in Sections 8 and 13. As used in this Agreement, the term
"UNDERWRITER" includes, for all purposes of this Agreement unless the context
requires otherwise, any party not listed in Schedule 1 hereto who, pursuant to
this Section 11, purchases Stock which a defaulting Underwriter agreed but
failed to purchase.
Nothing contained herein shall relieve a defaulting Underwriter of any
liability it may have to the Company and the Selling Stockholders for damages
caused by its default. If other Underwriters are obligated or agree to purchase
the Stock of a defaulting or withdrawing Underwriter, either the Representatives
or the Company may postpone the Delivery Date for up to seven full business days
in order to effect any changes that in the opinion of counsel for the Company or
counsel for the Underwriters may be necessary in the Registration Statement, the
Prospectus or in any other document or arrangement.
SECTION 12. Termination. The obligations of the Underwriters hereunder may be
terminated by the Representatives by notice given to and received by the Company
and the Selling Stockholders prior to delivery of and payment for the Firm Stock
if, prior to that time, any of the events described in Section 9(l) or 9(m),
shall have occurred or if the Underwriters shall decline to purchase the Stock
for any reason permitted under this Agreement.
SECTION 13. Reimbursement of Underwriters' Expenses. If the Company or any
Selling Stockholder shall fail to tender the Stock for delivery to the
Underwriters by reason of any failure, refusal or inability on the part of the
Company or the Selling Stockholders to perform any agreement on its part to be
performed, or because any other condition of the Underwriters' obligations
hereunder required to be fulfilled by the Company or the Selling Stockholders is
not fulfilled, the Company [and the Selling Stockholders] will reimburse the
Underwriters for all reasonable out-of-pocket expenses (including fees and
disbursements of counsel) incurred by the Underwriters in connection with this
Agreement and the proposed purchase of the Stock, and upon demand the Company
[and the Selling Stockholders] shall pay the full amount thereof to the
Representatives. If this Agreement is terminated pursuant to Section 11 by
reason of the default of one or more Underwriters, neither the Company nor any
Selling Stockholders shall be obligated to reimburse any defaulting Underwriter
on account of those expenses.
SECTION 14. Notices, Etc. All statements, requests, notices and agreements
hereunder shall be in writing, and:
(a) if to the Underwriters, shall be delivered or sent by mail, telex or
facsimile transmission to Xxxxxx Brothers Inc., 000 Xxxxxxx Xxxxxx, Xxx Xxxx,
X.X. 00000, Attention: Syndicate Registration Department, Fax: (000) 000-0000,
with a copy, in the case of any notice pursuant to Section 10(c), to the
Director of Litigation, Office of the General Counsel, Xxxxxx Brothers Inc., 000
Xxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, XX 00000;
(b) if to the Company, shall be delivered or sent by mail, telex or
facsimile transmission to the Company, 00 Xxxxx Xxxx, Xxxxxx, Xxxxxxxxxxx 00000,
Attention: General Counsel, Fax: (000) 000-0000;
23
(c) if to any Selling Stockholders, shall be delivered or sent by mail,
telex or facsimile transmission to such Selling Stockholder at the address set
forth on Schedule 2 hereto;
provided, however, that any notice to an Underwriter pursuant to Section
10(d) shall be delivered or sent by mail, telex or facsimile transmission to
such Underwriter at its address set forth in its acceptance telex to the
Representatives, which address will be supplied to any other party hereto by the
Representatives upon request. Any such statements, requests, notices or
agreements shall take effect at the time of receipt thereof. The Company and the
Selling Stockholders shall be entitled to act and rely upon any request,
consent, notice or agreement given or made on behalf of the Underwriters by
Xxxxxx Brothers Inc. on behalf of the Representatives and the Company and the
Underwriters shall be entitled to act and rely upon any request, consent, notice
or agreement given or made on behalf of the Selling Stockholders by the
Custodian.
SECTION 15. Persons Entitled to Benefit of Agreement. This Agreement shall inure
to the benefit of and be binding upon the Underwriters, the Company, the Selling
Stockholders and their respective successors. This Agreement and the terms and
provisions hereof are for the sole benefit of only those persons, except that
(A) the representations, warranties, indemnities and agreements of the Company
and the Selling Stockholders contained in this Agreement shall also be deemed to
be for the benefit of the directors, officers and the person or persons, if any,
who control any Underwriter within the meaning of Section 15 of the Securities
Act and (B) the indemnity agreement of the Underwriters contained in Section
10(c) of this Agreement shall be deemed to be for the benefit of directors of
the Company, officers of the Company who have signed the Registration Statement
and any person controlling the Company within the meaning of Section 15 of the
Securities Act. Nothing in this Agreement is intended or shall be construed to
give any person, other than the persons referred to in this Section 15, any
legal or equitable right, remedy or claim under or in respect of this Agreement
or any provision contained herein.
SECTION 16. Survival. The respective indemnities, representations, warranties
and agreements of the Company, the Selling Stockholders and the Underwriters
contained in this Agreement or made by or on behalf on them, respectively,
pursuant to this Agreement, shall survive the delivery of and payment for the
Stock and shall remain in full force and effect, regardless of any investigation
made by or on behalf of any of them or any person controlling any of them.
SECTION 17. Definition of the Terms "BUSINESS DAY" and "SUBSIDIARY". For
purposes of this Agreement, (a) "BUSINESS DAY" means each Monday, Tuesday,
Wednesday, Thursday or Friday which is not a day on which banking institutions
in the State of New York are generally authorized or obligated by law or
executive order to close and (b) "SUBSIDIARY" has the meaning set forth in Rule
405 of the Rules and Regulations.
SECTION 18. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF NEW YORK.
SECTION 19. Counterparts. This Agreement may be executed in one or more
counterparts and, if executed in more than one counterpart, the executed
counterparts shall each be deemed to be an original but all such counterparts
shall together constitute one and the same instrument.
SECTION 20. Headings. The headings herein are inserted for convenience of
reference only and are not intended to be part of, or to affect the meaning or
interpretation of, this Agreement.
24
If the foregoing correctly sets forth the agreement among the Company, the
Selling Stockholders and the Underwriters, please indicate your acceptance in
the space provided for that purpose below.
Very truly yours,
GREENFIELD ONLINE, INC.
By
--------------------------------------
Name:
-----------------------------------
Title:
----------------------------------
The Selling Stockholders named in
Schedule 2 to this Agreement
By
--------------------------------------
Attorney-in-Fact
Accepted:
XXXXXX BROTHERS INC.
FRIEDMAN, BILLINGS, XXXXXX & CO., INC.
XXXXX XXXXXXX & CO.
For themselves and as Representatives
of the several Underwriters named
in Schedule 1 hereto
BY XXXXXX BROTHERS INC.
By
----------------------------
Authorized Representative
25
SCHEDULE 1
Underwriter Number of Firm Shares to be Purchased
XXXXXX BROTHERS INC. [ ]
---------
XXXXXXXX XXXXXXXX XXXXXX & CO. INC. [ ]
---------
XXXXX XXXXXXX & CO. [ ]
---------
SCHEDULE 2
[to be updated]
Number of Shares of Option
Stock to be Sold if Option
Name and address of Selling Stockholder Number of Shares of Firm Stock is Exercised in Full
--------------------------------------- ------------------------------ --------------------
Xxxx X. Xxxxxx 71,675
[address]
Xxxxxxxx X. Xxxxxx 236,060
[address]
Xxxxxxx Xxxxxx 510,253
[address]
Xxxxxx X. Xxxxxxx 7,698
[address]
Xxxx X. Xxxxxxx 67,399
[address]
Xxxxxx X. Xxxx 20,068
[address]
Xxxx X. Xxxxx 11,423
[address]
Xxxxxxxx X. Xxxxxx 8,536
[address]
Xxxxx Xxxxx 10,091
[address]
Entities affiliated with Insight Venture 510,253
Associates III, LLC
[address]
UBS Capital II LLC 236,060
[address]
Forrestor Research, Inc. 11,635
[address]
Xxxxx Xxxxxxxx 4,002
[address]
Xxxx Xxxxxxxxxx 1,582
[address]
Greenfield/Xxxxxx Family, LLC. 1,582
[address]
Xxxx Xxxxxx-Xxxxx 172
[address]
Xxxxx Xxxx 37
[address]
Total
EXHIBIT A
LOCK-UP LETTER AGREEMENT
XXXXXX BROTHERS INC.
FRIEDMAN, BILLINGS, XXXXXX & CO., INC.
XXXXX XXXXXXX & CO.
As Representatives of the several
Underwriters named in Schedule 1
to the Underwriting Agreement,
c/x Xxxxxx Brothers Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
The undersigned understands that you and certain other firms propose to
enter into an Underwriting Agreement (the "UNDERWRITING AGREEMENT") providing
for the purchase by you and such other firms (the "UNDERWRITERS") of shares (the
"SHARES") of Common Stock, par value $0.0001 per share (the "COMMON STOCK"), of
Greenfield Online, Inc., a Delaware corporation (the "COMPANY"), and that the
Underwriters propose to reoffer the Shares to the public (the "OFFERING").
In consideration of the execution of the Underwriting Agreement by the
Underwriters, and for other good and valuable consideration, the undersigned
hereby irrevocably agrees that, without the prior written consent of Xxxxxx
Brothers Inc., on behalf of the Underwriters, the undersigned will not, directly
or indirectly, (1) offer for sale, sell, pledge, or otherwise dispose of (or
enter into any transaction or device that is designed to, or could be expected
to, result in the disposition by any person at any time in the future of) any
shares of Common Stock(1) (including, without limitation, shares of Common Stock
that may be deemed to be beneficially owned by the undersigned in accordance
with the rules and regulations of the Securities and Exchange Commission and
shares of Common Stock that may be issued upon exercise of any option or
warrant) or securities convertible into or exchangeable for Common Stock (other
than the Shares), or (2) enter into any swap or other derivatives transaction
that transfers to another, in whole or in part, any of the economic benefits or
risks of ownership of such shares of Common Stock, whether any such transaction
described in clause (1) or (2) above is to be settled by delivery of Common
Stock or other securities, in cash or otherwise, for a period of 180 days after
the date of the final Prospectus relating to the Offering.
The foregoing sentence shall not apply to bona fide gifts, sales or other
dispositions of shares of any class of the Company's capital stock, in each case
that are made exclusively
--------------
1 Holders of less than 1% of the Company's Common Stock who are not
directors, officers, employees or selling stockholders will not have any
shares they purchase after the closing of the IPO in the public markets be
made subject to this lock-up.
A-1
between and among the undersigned or members of the undersigned's family, or
affiliates of the undersigned, including its partners (if a partnership) or
members (if a limited liability company); provided that it shall be a condition
to any such transfer that (i) the transferee/donee agrees to be bound by the
terms of this lock-up letter agreement (including, without limitation, the
restrictions set forth in the preceding sentence) to the same extent as if the
transferee/donee were a party hereto, (ii) no filing by any party (donor, donee,
transferor or transferee) under the Securities Exchange Act of 1934, as amended
(the "Exchange Act") shall be required or shall be voluntarily made in
connection with such transfer or distribution (other than a filing on a Form 5,
Schedule 13D or Schedule 13(G) (or 13D A or 13G A) made after the expiration of
the 180 day period referred to above), (iii) each party (donor, donee,
transferor or transferee) shall not be required by law (including without
limitation the disclosure requirements of the Securities Act of 1933, as
amended, and the Exchange Act) to make, and shall agree to not voluntarily make,
any public announcement of the transfer or disposition, and (iv) the undersigned
notifies [Xxxxxx Brothers' Equity Capital Markets] at least two business days
prior to the proposed transfer or disposition.
In furtherance of the foregoing, the Company and its Transfer Agent are
hereby authorized to decline to make any transfer of securities if such transfer
would constitute a violation or breach of this Lock-Up Letter Agreement.
It is understood that, if the Company notifies you that it does not intend
to proceed with the Offering, if the Underwriting Agreement does not become
effective, or if the Underwriting Agreement (other than the provisions thereof
which survive termination) shall terminate or be terminated prior to payment for
and delivery of the Shares, we will be released from our obligations under this
Lock-Up Letter Agreement.
The undersigned understands that the Company and the Underwriters will
proceed with the Offering in reliance on this Lock-Up Letter Agreement.
Whether or not the Offering actually occurs depends on a number of
factors, including market conditions. Any Offering will only be made pursuant to
an Underwriting Agreement, the terms of which are subject to negotiation between
the Company and the Underwriters.
The undersigned hereby represents and warrants that the undersigned has
full power and authority to enter into this Lock-Up Letter Agreement and that,
upon request, the undersigned will execute any additional documents necessary in
connection with the enforcement hereof. Any obligations of the undersigned shall
be binding upon the heirs, personal representatives, successors and assigns of
the undersigned.
Very truly yours,
By:
------------------------------------
Name:
Title:
Dated:
---------------------------
A-2
