3,000,000 Shares
(plus 450,000 Shares to cover overallotments, if any)
XXXXXX INTERNATIONAL GROUP, INC.
Common Stock
UNDERWRITING AGREEMENT
November 4, 1996
ADVEST, INC.
MESIROW FINANCIAL, INC.
As Representatives (the "Representatives")
of the Several Underwriters
Named in Schedule I Hereto
c/o Advest, Inc.
00 Xxxxx Xxxxx Xxxxxx
Xxxxxxxx, XX 00000
Dear Sirs:
Xxxxxx International Group, Inc., an Indiana corporation (the
"Company") and a wholly owned subsidiary of Goran Capital Inc., a Canadian
federally chartered corporation ("Parent"), proposes, subject to the terms and
conditions stated herein, to sell to the Underwriters (the "Underwriters") named
in Schedule I hereto an aggregate of Three Million (3,000,000) shares (the
"Company Shares") of the Company's Common Stock, no par value ("Common Stock").
In addition, in order to cover overallotments in the sale of
the Company Shares, the Underwriters may, at the Underwriters' election and
subject to the terms and conditions stated herein, purchase ratably in
proportion to the amounts set forth opposite their respective names in Schedule
I hereto, up to Four Hundred Fifty Thousand (450,000) additional shares of
Common Stock from the Company (such additional shares of Common Stock, the
"Optional Shares"). The Company Shares and the Optional Shares are referred to
collectively herein as the "Shares."
As part of the offering contemplated by this Agreement,
Advest, Inc. has agreed to reserve out of the Shares set forth opposite its name
on Schedule I to this Agreement, up to 150,000 Shares, for sale to certain
officers, directors and employees of the Company and its affiliates, certain
family members of the foregoing and other persons having business relationships
with the Company or its affiliates (collectively, "Participants"), as set forth
in the Prospectus under the heading "Underwriting" (the "Directed Share
Program"). The Shares to be sold by Advest, Inc.
pursuant to the Directed Share Program (the "Directed Shares") will be sold by
Advest, Inc. pursuant to this Agreement at the public offering price. Any
Directed Shares not orally confirmed for purchase by any Participants by the end
of the first business day after the date on which this Agreement is executed
will be offered to the public by Advest, Inc. as set forth in the Prospectus.
The Company hereby confirms its engagement of each of Advest, Inc. and
Mesirow Financial, Inc. as, and each of Advest, Inc. and Mesirow Financial, Inc.
hereby confirms its agreement with the Company to render services as, a
"qualified independent underwriter" within the meaning of Rule 2720 of the
Conduct Rules of the National Association of Securities Dealers, Inc. with
respect to the offering and sale of the Shares. Each of Advest, Inc. and Mesirow
Financial, Inc., solely in its capacity as qualified independent underwriter and
not otherwise, is referred to herein as a "QIU" (and together with the other
QIU, as the "QIUs").
Each of the Company and Parent, intending to be legally bound, hereby
confirms its agreement with the Underwriters as follows:
1. Representations and Warranties of the Company and Parent.
(a) Each of the Company and Parent, and IGF Holdings, Inc., an
Indiana corporation and a wholly owned subsidiary of the Company
("IGFH") (to the extent that the following representations and
warranties relate directly to IGFH or its subsidiaries), jointly and
severally represent and warrant to, and agree with, each of the
Underwriters that:
(i) A registration statement on Form S-1 (File No.
333-09129) with respect to the Shares, including a prospectus
subject to completion, has been filed by the Company with the
Securities and Exchange Commission (the "Commission") under the
Securities Act of 1933, as amended (the "Act"), and one or more
amendments to such registration statement may have been so filed.
After the execution of this Agreement, the Company will file with
the Commission either (A) if such registration statement, as it
may have been amended, has become effective under the Act and
information has been omitted therefrom in accordance with Rule
430A under the Act, a prospectus in the form most recently
included in an amendment to such registration statement (or, if
no such amendment shall have been filed, in such registration
statement) with such changes or insertions as are required by
Rule 430A or permitted by Rule 424(b) under the Act and as have
been provided to and approved by the Representatives, or (B) if
such registration statement, as it may have been amended, has not
become effective under the Act, an
2
amendment to such registration statement, including a form of
prospectus, a copy of which amendment has been provided to and
approved by the Representatives prior to the execution of this
Agreement. As used in this Agreement, the term "Registration
Statement" means such registration statement, as amended at the
time when it was or is declared effective, including (i) all
financial statements, schedules and exhibits thereto, (ii) all
documents (or portions thereof) incorporated by reference
therein, and (iii) any information omitted therefrom pursuant to
Rule 430A under the Act and included in the Prospectus (as
hereinafter defined); the term "Preliminary Prospectus" means
each prospectus subject to completion included in such
registration statement or any amendment or post-effective
amendment thereto (including the prospectus subject to
completion, if any, included in the Registration Statement at the
time it was or is declared effective), including all documents
(or portions thereof) incorporated by reference therein; and the
term "Prospectus" means the prospectus first filed with the
Commission pursuant to Rule 424(b) under the Act or, if no
prospectus is required to be so filed, such term means the
prospectus included in the Registration Statement, in either
case, including all documents (or portions thereof) incorporated
by reference therein. As used herein, any reference to any
statement or information as being "made," "included,"
"contained," "disclosed" or "set forth" in any Preliminary
Prospectus, a Prospectus or any amendment or supplement thereto,
or the Registration Statement or any amendment thereto (or other
similar references) shall refer both to information and
statements actually appearing in such document as well as
information and statements incorporated by reference therein.
(ii) No order preventing or suspending the use of any
Preliminary Prospectus has been issued and no proceeding for that
purpose has been instituted or threatened by the Commission or
the securities authority of any state or other jurisdiction. If
the Registration Statement has become effective under the Act, no
stop order suspending the effectiveness of the Registration
Statement or any part thereof has been issued and no proceeding
for that purpose has been instituted or threatened or, to the
best knowledge of the Company, contemplated by the Commission or
the securities authority of any state or other jurisdiction.
(iii) When any Preliminary Prospectus was filed with the
Commission it (A) contained all statements required to be stated
therein in accordance with, and complied in all material respects
with the requirements of, the Act and the rules and regulations
of the Commission thereunder and (B) did not include any 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, not misleading.
When the Registration Statement or any
3
amendment thereto was or is declared effective, and at each Time
of Delivery (as hereinafter defined), it (A) contained and will
contain all statements required to be stated therein in
accordance with, and complied or will comply in all material
respects with the requirements of, the Act and the rules and
regulations of the Commission thereunder and (B) did not and will
not include any untrue statement of a material fact or omit to
state any material fact necessary to make the statements therein
not misleading. When the Prospectus or any amendment or
supplement thereto is filed with the Commission pursuant to Rule
424(b) (or, if the Prospectus or such amendment or supplement is
not required to be so filed, when the Registration Statement or
the amendment thereto containing such amendment or supplement to
the Prospectus was or is declared effective) and at each Time of
Delivery, the Prospectus, as amended or supplemented at any such
time, (A) contained and will contain all statements required to
be stated therein in accordance with, and complied or will comply
in all material respects with the requirements of, the Act and
the rules and regulations of the Commission thereunder and (B)
did not and will not include any 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, not misleading. The foregoing
provisions of this paragraph (iii) do not apply to statements or
omissions made in any Preliminary Prospectus, the Registration
Statement or any amendment thereto or the Prospectus or any
amendment or supplement thereto in reliance upon and in
conformity with written information furnished to the Company by
any Underwriter through you specifically for use therein. It is
understood that the statements set forth in each Preliminary
Prospectus, the Registration Statement or any amendment thereto
or the Prospectus or any amendment or supplement thereto (W) in
the last paragraph of the cover page, (X) on the inside cover
page with respect to stabilization and passive market making, (Y)
under the section entitled "Underwriting" regarding the
Underwriters and the underwriting arrangements, and (Z) under the
section entitled "Legal Matters" regarding the identity of the
counsel for the Underwriters, constitute the only written
information furnished to the Company by or on behalf of any
Underwriter through you specifically for use in any Preliminary
Prospectus, the Registration Statement or any amendment thereto
or the Prospectus and any amendment or supplement thereto, as the
case may be.
(iv) The descriptions in the Registration Statement and the
Prospectus of laws, statutes, regulations, legal and governmental
proceedings, contracts and other documents are accurate in all
material respects; and there are no laws, statutes, regulations,
or legal or governmental proceedings required to be described in
the Registration Statement or the Prospectus that are not
described as required and no contracts or documents of a
character that are required to be described in the
4
Registration Statement or the Prospectus or to be filed as
exhibits to the Registration Statement that are not described and
filed as required.
(v) Each of the Company and its subsidiaries has been duly
incorporated, is validly existing as a corporation in good
standing under the laws of its jurisdiction of incorporation and
has full power and authority (corporate and other) to own or
lease its properties and conduct its business as described in the
Prospectus. Each of the Company and Parent has full power and
authority (corporate and other) to enter into this Agreement and
to perform its obligations hereunder. Each of the Company and its
subsidiaries is duly qualified to transact business as a foreign
corporation and is in good standing under the laws of each other
jurisdiction in which it owns or leases properties, or conducts
any business, so as to require such qualification, except where
the failure to so qualify would not have a material adverse
effect on the financial position, results of operations or
business of the Company and its subsidiaries taken as a whole (a
"Material Adverse Event").
(vi) The Company's authorized, issued and outstanding
capital stock is as disclosed in the Prospectus. All of the
issued shares of capital stock of the Company have been duly
authorized and validly issued, are fully paid and nonassessable
and conform to the descriptions of the Common Stock contained in
the Prospectus. None of the issued shares of capital stock of the
Company or any of its subsidiaries has been issued or is owned or
held in violation of any statutory (or to the knowledge of the
Company, any other) preemptive rights of shareholders, and no
person or entity (including any holder of outstanding shares of
capital stock of the Company or its subsidiaries) has any
statutory (or to the knowledge of the Company, any other)
preemptive or other rights to subscribe for any of the Shares.
None of the capital stock of the Company has been issued in
violation of applicable federal or state securities laws.
(vii) All of the issued shares of capital stock of each of
the Company's subsidiaries have been duly authorized and validly
issued, are fully paid and nonassessable and are owned
beneficially by the Company or a subsidiary of the Company, free
and clear of all liens, security interests, pledges, charges,
encumbrances, defects, shareholders' agreements, voting
agreements, proxies, voting trusts, equities or claims of any
nature whatsoever except for (A) the pledge by GGS Management,
Inc., a Delaware corporation ("GGS Management") of all of the
outstanding shares of capital stock of Pafco General Insurance
Company, an Indiana insurance company, and Superior Insurance
Company, a Florida insurance company, as collateral to secure the
GGS Senior Credit Facility (as such term is defined in the
Prospectus), (B) the pledge by GGS Management
5
Holdings, Inc., a Delaware corporation, of all of the outstanding
shares of capital stock of GGS Management as collateral to secure
the GGS Senior Credit Facility, (C) the pledge by IGFH of 29,614
shares of Common Stock of IGF Insurance Company ("IGF") and
2,494,000 shares of IGF Preferred Stock as collateral to secure
both the IGFH Bank Debt and the IGF Note (as such terms are
defined in the Prospectus) and (D) the pledge by the Company of
shares of IGFH and GGS Management Holdings, Inc. as security for
the obligations of Parent under the Amended and Restated Trust
Indenture dated as of December 29, 1992, as amended by the First
Supplemental Indenture dated as of April 30, 1996 which will be
released prior to the closing of the sale and purchase of the
Shares (the pledges described in clauses (A), (B), (C) and (D)
being hereinafter referred to as the "Pledges") and (E) the
Stockholder Agreement (as such term is defined in the
Prospectus). Other than the subsidiaries listed on Exhibit 21 to
the Registration Statement and the equity securities held in the
investment portfolios of such subsidiaries (the composition of
which is not materially different than the disclosures in the
Prospectus as of specific dates), the Company does not own,
directly or indirectly, any capital stock or other equity
securities of any other corporation or any ownership interest in
any partnership, joint venture or other association.
(viii) Except as disclosed in the Prospectus, there are no
outstanding (A) securities or obligations of the Company or any
of its subsidiaries convertible into or exchangeable for any
capital stock of the Company or any such subsidiary, (B)
warrants, rights or options to subscribe for or purchase from the
Company or any such subsidiary any such capital stock or any such
convertible or exchangeable securities or obligations or (C)
obligations of the Company or any such subsidiary to issue any
shares of capital stock, any such convertible or exchangeable
securities or obligations, or any such warrants, rights or
options.
(ix) Since the date of the most recent audited financial
statements included in the Prospectus, neither the Company nor
any of its subsidiaries has sustained 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 disclosed in or contemplated by the Prospectus
and other than pursuant to claims made by insureds in the
ordinary course of business under policies issued by the
Company's subsidiaries.
(x) Since the respective dates as of which information is
given in the Registration Statement and the Prospectus, (A)
neither the Company nor any of its subsidiaries has incurred any
liabilities or obligations, direct or contingent, or entered into
any transactions, not in the ordinary
6
course of business, that are material to the Company and its
subsidiaries, (B) the Company has not purchased any of its
outstanding capital stock or declared, paid or otherwise made any
dividend or distribution of any kind on its capital stock, (C)
there has not been any change in the capital stock, long-term
debt or short-term debt of the Company or any of its
subsidiaries, and (D) there has not been any material adverse
change, or any development involving a prospective material
adverse change, in or affecting the financial position, results
of operations or business of the Company and its subsidiaries, in
each case other than as disclosed in or contemplated by the
Prospectus.
(xi) Except for the Goran Registration Rights Agreement (as
such term is defined in the Prospectus), there are no contracts,
agreements or understandings between the Company and any person
granting such person the right to require the Company to file a
registration statement under the 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
any such right has been effectively waived) or any securities
being registered pursuant to any other registration statement
filed by the Company under the Act.
(xii) Neither the Company nor any of its subsidiaries is, or
with the giving of notice or passage of time or both would be, in
violation of its Articles of Incorporation or Bylaws or in
default in any material respect under any indenture, mortgage,
deed of trust, loan agreement, lease or other agreement or
instrument to which the Company or any of its subsidiaries is a
party or to which any of their respective properties or assets
are subject.
(xiii) The Company and its subsidiaries have good and
marketable title in fee simple to all real property, if any, and
good title to all personal property owned by them, in each case
free and clear of all liens, security interests, pledges,
charges, encumbrances, mortgages and defects, except such as are
disclosed in the Prospectus or such as do not constitute a
Material Adverse Event and do not interfere with the use made or
proposed to be made of such property by the Company and its
subsidiaries; and any real property and buildings held under
lease by the Company or any of its subsidiaries are held under
valid, subsisting and enforceable leases, with such exceptions as
are disclosed in the Prospectus or are not material and do not
interfere with the use made or proposed to be made of such
property and buildings by the Company or such subsidiary.
(xiv) Neither the Company nor Parent requires any consent,
approval, authorization, order or declaration of or from, or
registration, qualification or filing with, any court or
7
governmental agency or body in connection with the sale of the
Shares or the consummation of the transactions contemplated by
this Agreement in order for the Company to be permitted to
increase the capital and surplus of the Company's insurance
company subsidiaries as contemplated in the "Use of Proceeds"
section of the Prospectus, the registration of the Shares under
the Act (which, if the Registration Statement is not effective as
of the time of execution hereof, shall be obtained as provided in
this Agreement) and the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), and such as may be required under
state securities or blue sky laws in connection with the offer,
sale and distribution of the Shares by the Underwriters.
(xv) Other than as disclosed in the Prospectus, there is no
litigation, arbitration, claim, proceeding (formal or informal)
or investigation (including without limitation, any insurance
regulatory proceeding) pending or, to the best of the Company's
or Parent's knowledge, as the case may be, threatened in which
the Company or any of its subsidiaries or Parent is a party or of
which any of their respective properties or assets are the
subject which, if determined adversely to the Company or any such
subsidiary or Parent, would individually or in the aggregate
constitute a Material Adverse Event. Neither the Company nor any
of its subsidiaries nor Parent is in violation of, or in default
with respect to, any law, statute, rule, regulation, order,
judgment or decree, except as described in the Prospectus or such
as do not and will not individually or in the aggregate
constitute a Material Adverse Event, and neither the Company nor
any of its subsidiaries nor Parent is required to take any action
in order to avoid any such violation or default.
(xvi) To the best of the Company's knowledge, Coopers &
Xxxxxxx L.L.P., who have certified certain financial statements
of the Company and its consolidated subsidiaries included in the
Registration Statement and the Prospectus, are independent public
accountants as required by the Act, the Exchange Act and the
respective rules and regulations of the Commission thereunder.
(xvii) The consolidated financial statements and schedules
(including the related notes) of the Company and its consolidated
subsidiaries included in the Registration Statement, the
Prospectus and/or any Preliminary Prospectus were prepared in
accordance with generally accepted accounting principles
consistently applied throughout the periods involved and fairly
present the financial position and results of operations of the
Company and its subsidiaries, on a consolidated basis, at the
dates and for the periods presented. The selected financial data
set forth under the captions "Summary Company Consolidated
Financial Data," "Summary Superior Consolidated Financial Data,"
"Selected Consolidated Historical Financial Data
8
of Xxxxxx International Group, Inc.," "Management's Discussion
and Analysis of Financial Condition and Results of Operations of
the Company," "Selected Consolidated Historical Financial Data of
Superior Insurance Company" and "Management's Discussion and
Analysis of Financial Condition and Results of Operations of
Superior" in the Prospectus fairly present, on the basis stated
in the Prospectus, the information included therein, and have
been compiled on a basis consistent with that of the audited
financial statements included in the Registration Statement. The
supporting notes and schedules included in the Registration
Statement, the Prospectus and/or any Preliminary Prospectus
fairly state in all material respects the information required to
be stated therein in relation to the financial statements taken
as a whole. The unaudited interim consolidated financial
statements included in the Registration Statement comply as to
form in all material respects with the applicable accounting
requirements of Rule 10-01 of Regulation S-X under the Act.
(xviii) This Agreement has been duly authorized, executed
and delivered by each of the Company and Parent, and, assuming
due execution by the Representatives of the Underwriters,
constitutes the valid and binding agreement of each of the
Company and Parent, enforceable against the Company and Parent in
accordance with its terms, subject, as to enforcement, to
applicable bankruptcy, insolvency, reorganization and moratorium
laws and other laws relating to or affecting the enforcement of
creditors' rights generally and to general equitable principles
and except as the enforceability of rights to indemnity and
contribution under this Agreement may be limited under applicable
securities laws or the public policy underlying such laws.
(xix) The sale of the Shares and the performance of this
Agreement and the consummation of the transactions herein
contemplated will not (with or without the giving of notice or
the passage of time or both) (A) conflict with any term or
provision of the articles of incorporation or bylaws, or other
organizational documents, of the Company or Parent, (B) 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, lease or other agreement or instrument to
which the Company or Parent is a party or to which any of their
respective properties or assets are subject, (C) conflict with or
violate any provision of the governing instruments of the Company
or Parent or any law, statute, rule or regulation or any order,
judgment or decree of any court or governmental agency or body
having jurisdiction over the Company or Parent or any of the
properties or assets of the Company or Parent or (D) result in a
breach, termination or lapse of the corporate power and authority
of the Company or Parent to own or lease and operate its assets
and properties and conduct its business as described in the
Prospectus.
9
(xx) When the Shares have been duly delivered against
payment therefor as contemplated by this Agreement, the Shares
will be validly issued, fully paid and non-assessable, and the
holders thereof will not be subject to personal liability solely
by reason of being such holders. The certificates representing
the Shares are in proper legal form under, and conform in all
respects to the requirements of, the Indiana Business Corporation
Law, as amended. Neither the filing of the Registration Statement
nor the offering or sale of Shares as contemplated by this
Agreement gives any security holder of the Company any rights for
or relating to the registration of any shares of Common Stock or
any other capital stock of the Company, except such as have been
satisfied or waived.
(xxi) The Company has not distributed and will not
distribute any offering material in connection with the offering
and sale of the Shares other than the Registration Statement, a
Preliminary Prospectus, the Prospectus and other material, if
any, permitted by the Act.
(xxii) Neither the Company nor any of its officers,
directors or affiliates nor Parent has (A) taken, directly or
indirectly, any action designed to cause or result in, or that
has constituted or might reasonably be expected to constitute,
the stabilization or manipulation of the price of any security of
the Company or Parent to facilitate the sale or resale of the
Shares or (B) since the filing of the Registration Statement (1)
sold, bid for, purchased or paid anyone any compensation for
soliciting purchases of, the Shares or (2) paid or agreed to pay
to any person any compensation for soliciting another to purchase
any other securities of the Company or Parent.
(xxiii) Neither the Company, any of its subsidiaries, nor
any director, officer, employee or other person associated with
or acting on behalf of the Company or any such subsidiary has,
directly or indirectly, violated any provision of the Foreign
Corrupt Practices Act of 1977, as amended.
(xxiv) The operations of the Company and its subsidiaries
with respect to any real property currently leased or owned or by
any means controlled by the Company or any subsidiary (the "Real
Property") are in compliance in all material respects with all
federal, state, and local laws, ordinances, rules, and
regulations relating to occupational health and safety and the
environment (collectively, "Laws"), and the Company and its
subsidiaries have not violated any Laws in a way which would give
rise to a Material Adverse Event. Except as disclosed in the
Prospectus, there is no pending or, to the best of the Company's
knowledge, threatened claim, litigation or any administrative
agency proceeding, nor has the Company or any subsidiary received
any written or oral notice from any
10
governmental entity or third party, that: (A) alleges a material
violation of any Laws by the Company or any subsidiary or (B)
alleges the Company or any subsidiary is a liable party under the
Comprehensive Environmental Response, Compensation, and Liability
Act, 42 U.S.C. ss. 9601 et seq. or any state superfund law.
(xxv) The Company and each of its subsidiaries owns or has
the right to use trademarks, trademark applications, trade names,
service marks, franchises, trade secrets, proprietary or other
confidential information and intangible properties and assets
(collectively, "Intangibles"); and, to the best knowledge of the
Company, neither the Company nor any subsidiary has infringed or
is infringing, and neither the Company nor any subsidiary has
received notice of infringement with respect to, asserted
Intangibles of others.
(xxvi) The Company and each of its subsidiaries are insured
by insurers of recognized financial responsibility against such
losses and risks and in such amounts as are prudent and customary
in the businesses in which they are engaged; and neither the
Company nor any such subsidiary has any reason to believe that it
will not be able to renew its existing insurance coverage as and
when such coverage expires or to obtain similar coverage from
similar insurers as may be necessary to continue its business at
a comparable cost, except as disclosed in the Prospectus. The
foregoing representation is not intended to and does not relate
to any reinsurance contracts, agreements or treaties to which the
Company or any of its subsidiaries is a party.
(xxvii) Each of the Company and its subsidiaries makes and
keeps accurate books and records reflecting its assets and
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 the Company's consolidated
financial statements in accordance with generally accepted
accounting principles and to maintain accountability for the
assets of the Company, (C) access to the assets of the Company
and each of its subsidiaries is permitted only in accordance with
management's authorization and (D) the recorded accountability
for assets of the Company and each of its subsidiaries is
compared with existing assets at reasonable intervals and
appropriate action is taken with respect to any differences.
(xxviii) The Company and its subsidiaries have filed all
foreign, federal, state and local tax returns that are required
to be filed by them and have paid all taxes shown as due on such
returns as well as all other taxes, assessments and governmental
charges that are due and payable; and no material
11
deficiency with respect to any such return has been assessed or
proposed.
(xxix) Except for such plans that are expressly disclosed in
the Prospectus, the Company and its subsidiaries do not maintain,
contribute to or have any material liability with respect to any
employee benefit plan, profit sharing plan, employee pension
benefit plan, employee welfare benefit plan, equity-based plan or
deferred compensation plan or arrangements (collectively,
"Plans") that are subject to the provisions of the Employee
Retirement Income Security Act of 1974, as amended, and the rules
and regulations thereunder ("ERISA"). All Plans are in compliance
in all material respects with all applicable laws, including but
not limited to ERISA and the Internal Revenue Code of 1986, as
amended (the "Code"), and have been operated and administered in
all material respects in accordance with their terms. No Plan is
a defined benefit plan or multiemployer plan. The Company does
not provide retiree life and/or retiree health benefits or
coverage for any employee or any beneficiary of any employee
after such employee's termination of employment, except as
required by Section 4980B of the Code or under a Plan which is
intended to be "qualified" under Section 401(a) of the Code. No
Plan has been involved in any prohibited transaction under
Section 406 of ERISA or Section 4975 of the Code. Full payment
has been made of all amounts which the Company or any of its
subsidiaries were required under the terms of the Plans to have
paid as contributions to such Plans on or prior to the date
hereof (excluding any amounts not yet due). No material
liability, claim, action or litigation, has been incurred, made,
commenced or, to the knowledge of the Company, threatened, by or
against the Company or any of its subsidiaries with respect to
any Plan (other than for benefits payable in the ordinary
course). No material liability has been, or could reasonably be
expected to be, incurred under Title IV of ERISA or Section 412
of the Code by any entity required to be aggregated with the
Company or any of its subsidiaries pursuant to Section 4001(b) of
ERISA and/or Section 414(b) or (c) of the Code (and the
regulations promulgated thereunder) with respect to any "employee
pension benefit plan" which is not a Plan. As used in this
subsection, the terms "defined benefit plan," "employee benefit
plan," "employee pension benefit plan," "employee welfare benefit
plan" and "multiemployer plan" shall have the respective meanings
assigned to such terms in Section 3 of ERISA.
(xxx) No material labor dispute exists with the Company's or
any of its subsidiary's employees, and no such labor dispute is
threatened. The Company has no knowledge of any existing or
threatened labor disturbance by the employees of any of its
principal agents, suppliers, contractors or customers that would
give rise to a Material Adverse Event.
12
(xxxi) Each contract or other instrument (however
characterized or described) to which the Company or any
subsidiary is a party or by which any of its properties or
business is bound or affected and which is material to the
conduct of the Company's business as described in the Prospectus
has been duly and validly executed by the Company or such
subsidiary, and, to the knowledge of the Company, by the other
parties thereto. Each such contract or other instrument is in
full force and effect and is enforceable against the parties
thereto in accordance with its terms, and the Company and each of
its subsidiaries are not, and to the knowledge of the Company, no
other party is, in default thereunder, nor has any event occurred
that, with the lapse of time or the giving of notice, or both,
would constitute a default under any such contract or other
instrument. All necessary consents under such contracts or other
instruments to disclosure in the Prospectus with respect thereto
have been obtained.
(xxxii) The Company and its subsidiaries have received all
permits, licenses, franchises, authorizations, registrations,
qualifications and approvals (collectively, "Permits") of
governmental or regulatory authorities (including, without
limitation, state and/or other insurance regulatory authorities)
as may be required of them to own their properties and conduct
their businesses in the manner described in the Prospectus,
subject to such qualifications as may be set forth in the
Prospectus; and the Company and its subsidiaries have fulfilled
and performed all of their material obligations with respect to
such Permits, and no event has occurred which allows or, after
notice or lapse of time or both, would allow revocation or
termination thereof or result in any other material impairment of
the rights of the holder of any such Permit, subject in each case
to such qualification as may be set forth in the Prospectus; and,
except as described in the Prospectus, such Permits contain no
restrictions that materially affect the ability of the Company
and its subsidiaries to conduct their businesses.
(xxxiii) The Company and each of its subsidiaries have
filed, or has had filed on its behalf, on a timely basis, all
materials, reports, documents and information, including but not
limited to annual reports and reports of examination with each
applicable insurance regulatory authority, board or agency, which
are required to be filed by it, except where the failure to have
timely filed such materials, reports, documents and information
would not constitute a Material Adverse Event.
(xxxiv) Neither Parent nor the Company nor any of the Company's
subsidiaries is an "investment company" or a company "controlled" by
an investment company as such terms are defined in Sections 3(a) and
2(a)(9), respectively, of the Investment Company Act of 1940, as
amended (the "Investment Company Act"), and, if the Company conducts
its business as set
13
forth in the Registration Statement and the Prospectus, will not
become an "investment company" and will not be required to
register under the Investment Company Act.
(xxxv) To the best knowledge of the Company, none of the
officers, directors (except as previously disclosed to you by the
Company in writing) or shareholders holding 5% or more of any
class of the Company's capital stock are affiliated with any
member of the National Association of Securities Dealers, Inc.
(the "NASD").
(xxxvi) The common stock of Parent is registered under the
Exchange Act and Parent is in substantial compliance with the
requirements of the United States federal securities laws
(including, without limitation, the requirements of the Exchange
Act), the Nasdaq National Market and the Toronto Stock Exchange.
No document that has been filed by Parent with the Commission
pursuant to the Exchange Act including, without limitation, any
Form 10-K, 10-Q or 8-K, annual report to stockholders or proxy
statement, (a) contained at the time of such filing or, except to
the extent corrected or modified by a subsequent filing under the
Exchange Act, contains an untrue statement of material fact or
(b) omitted at the time of filing or, except to the extent
corrected or modified by a subsequent filing under the Exchange
Act, omits to state a material fact necessary in order to make
the statements made therein, in light of the circumstances under
which they were made, not misleading.
(xxxvii) The Company and each of its subsidiaries is in
compliance with all provisions of Section 1 of the Laws of
Florida, Chapter 92-198, An Act Relating to Disclosure of Doing
Business with Cuba.
(xxxviii) The Company has not offered, or caused the
Underwriters to offer, Shares to any person pursuant to the
Directed Share Program with the specific intent to unlawfully
influence (i) a customer or supplier of the Company to alter the
customer's or supplier's level or type of business with the
Company, or (ii) a trade journalist or publication to write or
publish favorable information about the Company or its products
or services.
Any certificate signed by any officer of the Company or any subsidiary in
such capacity and delivered to the Representatives or to counsel for the
Underwriters pursuant to this Agreement shall be deemed a representation and
warranty by the Company or such subsidiary to the several Underwriters as to the
matters covered thereby.
14
2. Purchase and Sale of Shares.
(a) Subject to the terms and conditions herein set forth, the
Company agrees to sell to each of the Underwriters, and each of the
Underwriters agrees, severally and not jointly, to purchase from the
Company, at a purchase price of Eleven Dollars and Fifty Cents
($11.50) per share (reflecting a seven percent underwriting discount
and a one percent non-accountable expense allowance payable to the
Representatives on behalf of the Underwriters pursuant to Section 6)
(the "Per Share Price"), the number of Company Shares (to be adjusted
by you so as to eliminate fractional shares) determined by multiplying
the aggregate number of Shares to be sold by the Company as set forth
in the first paragraph of this Agreement by a fraction, the numerator
of which is the aggregate number of Company Shares to be purchased by
such Underwriter as set forth opposite the name of such Underwriter in
Schedule I hereto, and the denominator of which is the aggregate
number of Company Shares to be purchased by the several Underwriters
hereunder.
(b) The Company hereby grants to the Underwriters the right to
purchase at their election in whole or in part from time to time up to
Four Hundred Fifty Thousand (450,000) Optional Shares, at the Per
Share Price, for the sole purpose of covering overallotments in the
sale of the Company Shares. Any such election to purchase Optional
Shares may be exercised by written notice from the Representatives to
the Company, given from time to time within a period of 30 calendar
days after the date of this Agreement and setting forth the aggregate
number of Optional Shares to be purchased and the date on which such
Optional Shares are to be delivered, as determined by you but in no
event earlier than the First Time of Delivery (as hereinafter defined)
or, unless you otherwise agree in writing, earlier than two or later
than ten business days after the date of such notice. In the event you
elect to purchase all or a portion of the Optional Shares, the Company
agrees to furnish or cause to be furnished to you the certificates,
letters and opinions, and to satisfy all conditions, set forth in
Section 7 hereof at each Subsequent Time of Delivery (as hereinafter
defined).
(c) In making this Agreement, each Underwriter is contracting
severally, and not jointly, and except as provided in Sections 2(b)
and 9 hereof, the agreement of each Underwriter is to purchase only
that number of shares specified with respect to that Underwriter in
Schedule I hereto. No Underwriter shall be under any obligation to
purchase any Optional Shares prior to an exercise of the option with
respect to such Shares granted pursuant to Section 2(b) hereof.
15
3. Offering by the Underwriters. Upon the authorization by you of the
release of the Shares, the several Underwriters propose to offer the Shares
for sale upon the terms and conditions disclosed in the Prospectus.
4. Delivery of Shares; Closing.
(a) Certificates in definitive form for the Shares to be
purchased by each Underwriter hereunder, and in such denominations and
registered in such names as you may request upon at least 48 hours'
prior notice to the Company, shall be delivered by or on behalf of the
Company, to you for the account of such Underwriter, against payment
by such Underwriter on its behalf of the purchase price therefor by
(at the Representatives' election) wire transfer of immediately
available funds to such accounts as the Company (as the case may be)
shall designate in writing, or by official bank check or checks
(payable in next day funds), payable to the order of the Company in
next-day available funds. The closing of the sale and purchase of the
Shares shall be held at the offices of LeBoeuf, Lamb, Xxxxxx & XxxXxx,
L.L.P., 000 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, except that
physical delivery of such certificates shall be made at the office of
The Depository Trust Company, 00 Xxxxx Xxxxx Xxxxxx, Xxx Xxxx, Xxx
Xxxx 00000. The time and date of such delivery and payment shall be,
with respect to the Company Shares, at 10:00 a.m., New York, New York
time, on the third (3rd) full business day after this Agreement is
executed or at such other time and date as you and the Company may
agree upon in writing, and, with respect to the Optional Shares, at
10:00 a.m., New York, New York time, on the date specified by you in
the written notice given by you of the Underwriters' election to
purchase all or part of such Optional Shares, or at such other time
and date as you and the Company may agree upon in writing. Such time
and date for delivery of the Company Shares is herein called the
"First Time of Delivery," such time and date for delivery of any
Optional Shares, if not the First Time of Delivery, is herein called a
"Subsequent Time of Delivery," and each such time and date for
delivery is herein called a "Time of Delivery." The Company will make
such certificates available for checking and packaging at least 24
hours prior to each Time of Delivery at the office of The Depository
Trust Company, 00 Xxxxx Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 or at
such other location specified by you in writing at least 48 hours
prior to such Time of Delivery.
5. Covenants of the Company.
(a) The Company and the Parent covenant and agree with each of the
Underwriters that:
(i) The Company will use its best efforts to cause the
Registration Statement, if not effective prior to the execution and
delivery of this Agreement, to become effective.
16
If the Registration Statement has been declared effective prior
to the execution and delivery of this Agreement, the Company will
file the Prospectus with the Commission pursuant to and in
accordance with subparagraph (1) (or, if applicable and if
consented to by you, subparagraph (4)) of Rule 424(b) not later
than the earlier of (A) the second business day following the
execution and delivery of this Agreement or (B) the fifth
business day after the date on which the Registration Statement
is declared effective. The Company will advise you promptly of
any such filing pursuant to Rule 424(b). The Company will file
promptly all reports and any definitive proxy or information
statements required to be filed by the Company with the
Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the
Exchange Act subsequent to the date of the Prospectus and for so
long as the delivery of a prospectus is required in connection
with the offering, sale and distribution of the Shares.
(ii) The Company will not file with the Commission the
prospectus or the amendment referred to in the second sentence of
Section 1(a)(i) hereof, any amendment or supplement to the
Prospectus or any amendment to the Registration Statement unless
you have received a reasonable period of time to review any such
proposed amendment or supplement and consented to the filing
thereof and will use its best efforts to cause any such amendment
to the Registration Statement to be declared effective as
promptly as possible. Upon the request of the Representatives or
counsel for the Underwriters, the Company will promptly prepare
and file with the Commission, in accordance with the rules and
regulations of the Commission, any amendments to the Registration
Statement or amendments or supplements to the Prospectus that may
be necessary or advisable in connection with the distribution of
the Shares by the several Underwriters and will use its best
efforts to cause any such amendment to the Registration Statement
to be declared effective as promptly as possible. If required,
the Company will file any amendment or supplement to the
Prospectus with the Commission in the manner and within the time
period required by Rule 424(b) under the Act. The Company will
advise the Representatives, promptly after receiving notice
thereof, of the time when the Registration Statement or any
amendment thereto has been filed or declared effective or the
Prospectus or any amendment or supplement thereto has been filed
and will provide evidence to the Representatives of each such
filing or effectiveness.
(iii) The Company will advise you promptly after receiving
notice or obtaining knowledge of (A) when any post-effective
amendment to the Registration Statement is filed with the
Commission, (B) the receipt of any comments from the Commission
concerning the Registration Statement, (C) when any
post-effective amendment to the Registration Statement becomes
effective, or when any supplement to the Prospectus or any
amended Prospectus has been filed, (D) the issuance by the
17
Commission of any stop order suspending the effectiveness of the
Registration Statement or any part thereof or any order
preventing or suspending the use of any Preliminary Prospectus or
the Prospectus or any amendment or supplement thereto, (E) the
suspension of the qualification of the Shares for offer or sale
in any jurisdiction or of the initiation or threatening of any
proceeding for any such purpose, (F) any request made by the
Commission or any securities authority of any other jurisdiction
for amending the Registration Statement, for amending or
supplementing the Prospectus or for additional information. The
Company will use its best efforts to prevent the issuance of any
such stop order or suspension and, if any such stop order or
suspension is issued, to obtain the withdrawal thereof as
promptly as possible.
(iv) If the delivery of a prospectus relating to the Shares
is required under the Act at any time prior to the expiration of
nine months after the date of the Prospectus and if at such time
any events 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, not misleading, or if
for any reason it is necessary during such same period to amend
or supplement the Prospectus, the Company will promptly notify
you and upon your request (but at the Company's expense) prepare
and file with the Commission an amendment or supplement to the
Prospectus that corrects such statement or omission or effects
such compliance and will furnish without charge to each
Underwriter and to any dealer in securities as many copies of
such amended or supplemented Prospectus as you may from time to
time reasonably request. If the delivery of a prospectus relating
to the Shares is required under the Act at any time nine months
or more after the date of the Prospectus, upon your request but
at the expense of such Underwriter, the Company will prepare and
deliver to such Underwriter as many copies as you may request of
an amended or supplemented Prospectus complying with Section
10(a)(3) of the Act.
(v) The Company promptly from time to time will take such
action as you may reasonably request to qualify the Shares for
offering and sale under the securities or blue sky laws of such
jurisdictions as you may request and will continue such
qualifications in effect for as long as may be necessary to
complete the distribution of the Shares, 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.
(vi) The Company will promptly provide you, without charge,
(A) three manually executed copies of the Registration Statement
as originally filed with the Commission
18
and of each amendment thereto, including all exhibits and all
documents or information incorporated by reference therein, (B)
for each other Underwriter a conformed copy of the Registration
Statement as originally filed and of each amendment thereto,
without exhibits but including all documents or information
incorporated by reference therein and (C) so long as a prospectus
relating to the Shares is required to be delivered under the Act,
as many copies of each Preliminary Prospectus or the Prospectus
or any amendment or supplement thereto as you may reasonably
request.
(vii) As soon as practicable, but in any event not later
than the last day of the thirteenth month after the effective
date of the Registration Statement, the Company will make
generally available to its security holders an earnings statement
of the Company and its subsidiaries, if any, covering a period of
at least 12 months beginning after the effective date of the
Registration Statement (which need not be audited) complying with
Section 11(a) of the Act and the rules and regulations
thereunder.
(viii) During the period beginning from the date hereof and
continuing to and including the date 180 days after the date of
the Prospectus, the Company and Parent will not, without your
prior written consent, offer, issue, sell, contract to sell,
grant any option for the sale of, or otherwise dispose of,
directly or indirectly, any shares of Common Stock or securities
convertible into or exercisable or exchangeable for shares of
Common Stock, except as provided in Section 2.
(ix) During the period of three years after the effective
date of the Registration Statement, the Company will furnish to
you and, upon request, to each of the other Underwriters, without
charge, (A) copies of all reports or other communications
(financial or other) furnished to shareholders and (B) as soon as
they are available, copies of any reports and financial
statements furnished to or filed with the Commission, the
National Association of Securities Dealers, Inc. or any national
securities exchange.
(x) Prior to the termination of the underwriting syndicate
contemplated by this Agreement, neither the Company nor any of
its officers, directors or affiliates nor Parent will (A) take,
directly or indirectly, any action designed to cause or to result
in, or that might reasonably be expected to constitute, the
stabilization or manipulation of the price of any security of the
Company to facilitate the sale or resale of any of the Shares or
(B) sell, bid for, purchase or pay anyone any compensation for
soliciting purchases of, the Shares other than as contemplated
under the Directed Share Program.
19
(xi) If at any time during the period beginning on the date
the Registration Statement becomes effective and ending on the
later of (A) the date 30 days after such effective date and (B)
the date that is the earlier of (1) the date on which the Company
first files with the Commission a Quarterly Report on Form 10-Q
after such effective date and (2) the date on which the Company
first issues a quarterly financial report to shareholders after
such effective date, (x) any publication or event relating to or
affecting the Company shall occur as a result of which in your
reasonable opinion the market price of the Common Stock has been
or is likely to be materially affected (regardless of whether
such publication or event necessitates an amendment of or
supplement to the Prospectus), or (y) any rumor relating to or
affecting the Company shall occur as a result of which in your
reasonable opinion the market price of the Common Stock has been
or is likely to be materially affected (regardless of whether
such rumor necessitates an amendment of or supplement to the
Prospectus), the Company will consult with you concerning the
necessity of a press release or other public statement, and, if
the Company determines that a press release or other public
statement is necessary, the Company will forthwith prepare and
consult with you concerning the substance of, and disseminate a
press release or other public statement, reasonably satisfactory
to you, responding to or commenting on such publication, event or
rumor.
(xii) The Company will comply with the Act, the Exchange Act
and the rules and regulations thereunder so as to permit the
continuance of sales of and dealings in the Shares for as long as
may be necessary to complete the distribution of the Shares as
contemplated hereby.
(xiii) In case of any event, at any time within the period
during which a prospectus is required to be delivered under the
Act, as a result of which any Preliminary Prospectus or the
Prospectus, as then amended or supplemented, would contain an
untrue statement of a material fact, or omit to state any
material fact necessary in order to make the statements therein,
in light of the circumstances under which they were made, not
misleading, or, if it is necessary at any time to amend any
Preliminary Prospectus or the Prospectus to comply with the Act
or any applicable securities or blue sky laws, the Company
promptly will prepare and file with the Commission, and any
applicable state securities commission, an amendment, supplement
or document that will correct such statement or omission or
effect such compliance and will furnish to the several
Underwriters such number of copies of such amendment(s),
supplement(s) or document(s) as the Representatives may
reasonably request. For purposes of this subsection, the Company
will provide such information to the Representatives, the
Underwriters' counsel and counsel to the Company as shall be
20
necessary to enable such persons to consult with the Company with
respect to the need to amend or supplement the Registration
Statement, any Preliminary Prospectus or the Prospectus or file
any document, and shall furnish to the Representatives and the
Underwriters' counsel such further information as each may from
time to time reasonably request.
(xiv) The Company will use its best efforts to maintain the
qualification or listing of the shares of Common Stock
(including, without limitation, the Shares) on the Nasdaq
National Market.
(xv) In connection with the Directed Share Program, the
Company will ensure that the Directed Shares will be restricted
to the extent required by the NASD or the NASD rules from sale,
transfer, assignment, pledge or hypothecation for a period of
three months following the date of the effectiveness of the
Registration Statement. Advest, Inc. will notify the Company as
to which Participants will need to be so restricted. At the
request of Advest, Inc., the Company will direct the transfer
agent to place stop transfer restrictions upon such securities
for such period of time.
(xvi) The Company will pay all fees and disbursements
incurred by the Underwriters in connection with the offer of any
Directed Shares outside of the United States under the Directed
Share Program and stamp duties, similar taxes or duties or other
taxes, if any, incurred by the Underwriters in connection with
the Directed Share Program.
(b) The Company and Parent covenant with Advest, Inc. that the
Company will 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.
6. Expenses. The Company will pay all costs and expenses incident to
the performance of the obligations of the Company under this Agreement,
whether or not the transactions contemplated hereby are consummated or this
Agreement is terminated pursuant to Section 10 hereof, including, without
limitation, all costs and expenses incident to (i) the printing of and
mailing expenses associated with the Registration Statement, the
Preliminary Prospectus and the Prospectus and any amendments or supplements
thereto, this Agreement, the Agreement among Underwriters, the
underwriters' questionnaire submitted to each of the Underwriters by the
Representatives in connection herewith, the power of attorney executed by
each of the Underwriters in favor of Advest, Inc. in connection herewith,
the Dealer Agreement and related documents (collectively, the "Underwriting
Documents") and the preliminary Blue Sky memorandum relating to the
offering prepared by LeBoeuf, Lamb, Xxxxxx &
21
XxxXxx, L.L.P., counsel to the Underwriters (collectively with any
supplement thereto, the "Preliminary Blue Sky Memorandum"); (ii) the fees,
disbursements and expenses of the Company's counsel and accountants in
connection with the registration of the Shares under the Act and all other
expenses in connection with the preparation and, if applicable, filing of
the Registration Statement (including all amendments thereto), any
Preliminary Prospectus, the Prospectus and any amendments and supplements
thereto, the Underwriting Documents and the Preliminary Blue Sky
Memorandum; (iii) the delivery of copies of the foregoing documents to the
Underwriters; (iv) the filing fees of the Commission and the NASD relating
to the Shares; (v) the preparation, issuance and delivery to the
Underwriters of any certificates evidencing the Shares, including transfer
agent's and registrar's fees; (vi) the qualification of the Shares for
offering and sale under state securities and blue sky laws, including
filing fees and fees and disbursements of counsel for the Underwriters (and
local counsel therefor) relating thereto; (vii) any listing of the Shares
on the Nasdaq National Market; (viii) any expenses for travel, lodging and
meals incurred by the Company and any of its officers, directors and
employees in connection with any meetings with prospective investors in the
Shares; (ix) the costs of advertising the offering, including, without
limitation, with respect to the placement of "tombstone" advertisements in
publications selected by the Representatives; and (x) all other costs and
expenses reasonably incident to the performance of the Company's
obligations hereunder that are not otherwise specifically provided for in
this Section 6. In addition, the Company has agreed to pay to Advest, Inc.,
on behalf of the Underwriters, at each Time of Delivery, a non-accountable
expense allowance in the amount of 1% of the gross proceeds from the sale
of the Shares to be applied to the reimbursement of underwriting syndicate
expenses.
7. Conditions of the Underwriters' Obligations. The obligations of the
Underwriters hereunder to purchase and pay for the Shares to be delivered
at each Time of Delivery shall be subject, in their discretion, to the
accuracy of the representations and warranties of each of the Company and
Parent contained herein as of the date hereof and as of such Time of
Delivery, to the accuracy of the statements of Company officers made
pursuant to the provisions hereof, to the performance by each of the
Company and Parent of its covenants and agreements hereunder, and to the
following additional conditions precedent:
(a) If the registration statement as amended to date has not
become effective prior to the execution of this Agreement, such
registration statement shall have been declared effective not later
than 11:00 a.m., Hartford, Connecticut time, on the date of this
Agreement or such later date and/or time as shall have been consented
to by you in writing. The Prospectus and any amendment or supplement
thereto shall have been filed
22
with the Commission pursuant to Rule 424(b) within the applicable time
period prescribed for such filing and in accordance with Section 5(a)
of this Agreement; no stop order suspending the effectiveness of the
Registration Statement or any part thereof shall have been issued and
no proceedings for that purpose shall have been instituted, threatened
or, to the knowledge of the Company, Parent or the Representatives,
contemplated by the Commission; and all requests for additional
information on the part of the Commission shall have been complied
with to your reasonable satisfaction.
(b) All corporate proceedings and other matters incident to the
authorization, form and validity of this Agreement, the Shares and the
form of the Registration Statement and the Prospectus, and all other
legal matters relating to this Agreement and the transactions
contemplated hereby, shall be satisfactory in all material respects to
counsel to the Underwriters.
(c) The Representatives shall have received copies of executed
lock-up agreements from each of Parent, the Company and the Company's
officers and directors who own shares of Common Stock or securities
convertible into or exchangeable or exercisable for Common Stock or
who may be issued shares of Common Stock under an option plan or other
arrangement to the effect that such individuals and entities will not
offer, sell, contract to sell, or otherwise dispose of, any such
shares of Common Stock or securities convertible into or exchangeable
or exercisable for Common Stock for a period of 180 days after the
date of the Prospectus without the written consent of Advest, Inc.
(d) The Representatives shall have received at or prior to the
First Time of Delivery from the Underwriters' counsel the Preliminary
Blue Sky Memorandum, such memorandum to be in form and substance
satisfactory to the Representatives.
(e) LeBoeuf, Lamb, Xxxxxx & XxxXxx, L.L.P., counsel for the
Underwriters, shall have furnished to you such opinion or opinions,
dated such Time of Delivery, with respect to the incorporation of the
Company, the validity of the Shares being delivered at such Time of
Delivery, the Registration Statement, the Prospectus, and other
related matters as you may reasonably request, and the Company shall
have furnished to such counsel such documents as they request for the
purpose of enabling them to pass upon such matters.
(f) The NASD shall have indicated that it has no objection to the
underwriting arrangements pertaining to the sale of any of the Shares.
23
(g) You shall have received an opinion, dated such Time of
Delivery, of Xxxxxx & Xxxxxxxxx, counsel for the Company, in form and
substance satisfactory to you and your counsel, to the effect that:
(i) The Company has been duly incorporated, is validly
existing as a corporation under the laws of the State of Indiana
and has the corporate power and authority to own or lease its
properties and conduct its business as described in the
Registration Statement and the Prospectus and to enter into this
Agreement and perform its obligations hereunder.
(ii) Each of the subsidiaries listed on Exhibit 21 to the
Registration Statement (the "Subsidiaries") of the Company is
validly existing as a corporation in good standing (where
applicable) under the laws of its jurisdiction of incorporation
and has the corporate power and authority to own or lease its
properties and conduct its business as described in the
Registration Statement and the Prospectus.
(iii) The Company's authorized, issued and outstanding
capital stock is as disclosed in the Prospectus. All of the
issued shares of Common Stock of the Company have been duly
authorized and validly issued, are fully paid and nonassessable
and conform to the description of the Common Stock contained in
the Prospectus. None of the outstanding shares of Common Stock
have been issued in violation of the preemptive or other similar
rights of any shareholder or warrantholder of the Company arising
by operation of law, under the Articles of Incorporation or
Bylaws of the Company or, to our knowledge, under any agreement
to which the Company or any of its Subsidiaries is a party. The
issuance of the shares of Common Stock is not subject to
preemptive or other similar rights under the Articles of
Incorporation or Bylaws of the Company or, to our knowledge,
under any agreement to which the Company or any of its
Subsidiaries is a party.
(iv) All of the issued shares of capital stock of each of
the Company's subsidiaries have been duly authorized and validly
issued, are fully paid and nonassessable, and, to such counsel's
knowledge, are owned beneficially by the Company or its
subsidiaries, free and clear of all liens, security interests,
pledges, charges, encumbrances, shareholders' agreements, voting
agreements, proxies, voting trusts, defects, equities or claims
of any nature whatsoever (collectively, "Encumbrances"),
including, without limitation, Encumbrances arising or resulting
from any indenture, mortgage, deed of trust, loan agreement,
lease or other agreement of or entered into by Parent, except for
the Pledges and the Stockholder Agreement (as such term is
defined in the Prospectus).
24
(v) When the Shares have been duly delivered against payment
therefor as contemplated by this Agreement, the Shares will be
duly authorized, validly issued and fully paid and nonassessable,
the holders thereof will not be subject to personal liability
solely by reason of being such holders and the Shares will
conform to the description of the Common Stock contained in the
Prospectus; the certificates evidencing the Shares will comply
with all applicable requirements of Indiana law; and the Shares
will have been listed on the Nasdaq National Market.
(vi) To such counsel's knowledge, neither the Company nor
any of its subsidiaries is, or with the giving of notice or
passage of time or both, would be, in violation of its Articles
of Incorporation or Bylaws, in each case as amended to date.
(vii) The sale of the Shares being sold at such Time of
Delivery and the performance of this Agreement and the
consummation of the transactions herein contemplated will not
violate any provision of the Articles of Incorporation or Bylaws
of the Company or any of its Subsidiaries, in each case as
amended to date, or to such counsel's knowledge, any existing
law, statute, rule or regulation, or conflict with, or (with or
without the giving of notice or the passage of time or both)
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, lease or other agreement or instrument
known to such counsel to which the Company or any such Subsidiary
is a party or to which any of their respective properties or
assets is subject (except for any conflicts with, breaches of or
violations of any such indentures, mortgages, deeds of trust,
loan agreements, leases or other agreements or instruments which
would not, individually or in the aggregate, have a material
adverse effect on the financial position, results of operations
or business of the Company and its subsidiaries taken as a
whole), or, conflict with or violate any order, judgment or
decree known to such counsel, of any court or governmental agency
or body having jurisdiction over the Company or any of its
Subsidiaries or any of their respective properties or assets,
except with respect to any statute, rule or regulation of any
regulatory authority imposing any obligation on the part of the
Underwriters by way of their purchase of the Shares, as to which
no opinion need be rendered.
(viii) To such counsel's knowledge, no consent, approval,
authorization, order or declaration of or from, or registration,
qualification or filing with, any court or governmental agency or
body is required for the sale of the Shares or the consummation
of the transactions contemplated by this Agreement, except such
as have been or will have been obtained and are or will be in
effect, and except the
25
registration of the Shares under the Act, the Exchange Act and
such as may be required under state securities or blue sky laws
in connection with the offer, sale and distribution of the Shares
by the Underwriters, as to which such counsel expresses no
opinion.
(ix) To such counsel's knowledge and other than as disclosed
in or contemplated by the Prospectus, there is no litigation,
arbitration, claim, proceeding (formal or informal) or
investigation pending or threatened, in which the Company or any
of its Subsidiaries is a party or of which any of their
respective properties or assets is the subject which, if
determined adversely to the Company or any such Subsidiary, would
individually or in the aggregate have a material adverse effect
on the financial position, results of operations or business of
the Company and its subsidiaries taken as a whole.
(x) The statements in the Prospectus under "Business --
Regulation," "Business -- Legal Proceedings," "Description of
Capital Stock" and "Shares Eligible for Future Sale" have been
reviewed by such counsel, and insofar as they refer to statements
of law, descriptions of statutes, licenses, rules or regulations,
or legal conclusions, are correct in all material respects.
(xi) This Agreement has been duly authorized, executed and
delivered by the Company.
(xii) Neither the Company nor any of its subsidiaries nor
Parent is an "investment company" or a company "controlled" by an
investment company as such terms are defined in Sections 3(a) and
2(a)(9), respectively, of the Investment Company Act of 1940, as
amended.
(xiii) The Registration Statement and the Prospectus and
each amendment or supplement thereto (other than the financial
statements, the notes and schedules thereto and other financial
data included therein, to which such counsel need express no
opinion), as of their respective effective or issue dates,
complied as to form in all material respects with the
requirements of the Act and the respective rules and regulations
thereunder. The descriptions in the Registration Statement and
the Prospectus of contracts and other documents are accurate in
all material respects and fairly present the information required
to be shown; and such counsel do not know of any contracts or
documents of a character required to be described in the
Registration Statement or Prospectus or to be filed as exhibits
to the Registration Statement which are not described and filed
as required.
(xiv) Such counsel has been advised by the Division of
Corporation Finance of the Commission that the
26
Registration Statement has become effective under the Act; any
required filing of the Prospectus pursuant to Rule 424(b) has
been made in the manner and within the time period required by
Rule 424(b); and, to such counsel's knowledge, (A) no stop order
suspending the effectiveness of the Registration Statement or any
part thereof has been issued and (B) no proceedings for that
purpose have been instituted or threatened or are contemplated by
the Commission.
Such counsel shall also state that they have participated in the
preparation of the Registration Statement and the Prospectus and in conferences
with officers and other representatives of the Company, representatives of the
independent public accountants for the Company, and representatives of and
counsel to the Underwriters at which the contents of the Registration Statement,
the Prospectus and related matters were discussed and, although such counsel has
not passed upon or assumed any responsibility for the accuracy, completeness or
fairness of the statements contained in the Registration Statement or the
Prospectus, and although such counsel has not undertaken to verify independently
the accuracy or completeness of the statements in the Registration Statement or
the Prospectus and, therefore, would not necessarily have become aware of any
material misstatement of fact or omission to state a material fact, on the basis
of and subject to the foregoing, nothing has come to such counsel's attention to
lead them to believe that the Registration Statement, or any further amendment
thereto made prior to such Time of Delivery, on its effective date and as of
such Time of Delivery, contained or contains any untrue statement of a material
fact or omitted or omits to state any material fact required to be stated
therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading, or that the
Prospectus, or any amendment or supplement thereto made prior to such Time of
Delivery, as of its issue date and as of such Time of Delivery, contained or
contains any untrue statement of a material fact or omitted or omits to state a
material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading (provided that such
counsel need express no belief regarding the financial statements, the notes and
schedules thereto and other financial and statistical data contained in the
Registration Statement, any amendment thereto, or the Prospectus, or any
amendment or supplement thereto).
In rendering any such opinion, such counsel may rely, as to matters of
fact, to the extent such counsel deem proper, on certificates of officers of the
Company and public officials and letters from officials of the NASD and on the
opinions of other counsel reasonably satisfactory to you and your counsel as to
matters which are governed by laws other than the laws of the State of Indiana
and the Federal laws of the United States;
27
provided that such counsel shall state in their opinion that they are so
relying, and they are justified in relying on such other opinions. Copies of
such certificates of officers of the Company and other opinions shall be
addressed and furnished to the Underwriters and furnished to counsel for the
Underwriters.
(h) You shall have received an opinion, dated such Time of Delivery, of
Xxxxx X. Xxxxx, Esquire, General Counsel of the Company and Parent, in form and
substance satisfactory to you and your counsel, to the effect that:
(i) The Company has been duly incorporated, is validly existing
as a corporation under the laws of the State of Indiana and has the
corporate power and authority to own or lease its properties and
conduct its business as described in the Registration Statement and
the Prospectus and to enter into this Agreement and perform its
obligations hereunder. The Company is duly qualified to transact
business as a foreign corporation and is in good standing under the
laws of each other jurisdiction in which it owns or leases property,
or conducts any business, so as to require such qualification, except
where the failure to so qualify would not have a material adverse
effect on the financial position, results of operations or business of
the Company and its subsidiaries taken as a whole. Parent has been
duly incorporated, is validly existing as a federally chartered
corporation in good standing under the laws of Canada and has the
corporate power and authority to enter into this Agreement and perform
its obligations hereunder.
(ii) Each of the subsidiaries of the Company is validly existing
as a corporation in good standing under the laws of its jurisdiction
of incorporation and has the corporate power and authority to own or
lease its properties and conduct its business as described in the
Registration Statement and the Prospectus. Each such subsidiary is
duly qualified to transact business as a foreign corporation and is in
good standing under the laws of each other jurisdiction in which it
owns or leases property, or conducts any business, so as to require
such qualification, except where the failure to so qualify would not
have a material adverse effect on the financial position, results of
operations or business of the Company and its subsidiaries taken as a
whole.
(iii) Except as disclosed in the Prospectus, there are, to such
counsel's knowledge, no outstanding (A) securities or obligations of
Parent, the Company or any of the Company's subsidiaries convertible
into or exchangeable for any capital stock of the Company or any such
subsidiary, (B) warrants, rights or options to subscribe for or
purchase from Parent, the Company or any such subsidiary any such
capital stock or any such convertible or exchangeable securities or
obligations or (C) obligations of Parent, the Company or any such
subsidiary
28
to issue any shares of capital stock, any such convertible or
exchangeable securities or obligations, or any such warrants, rights
or options.
(iv) Except for the Goran Registration Rights Agreement (as such
term is defined in the Prospectus), to such counsel's knowledge, there
are no contracts, agreements or understandings known to such counsel
between the Company and any person granting such person the right to
require the Company to file a registration statement under the 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
any such right has been effectively waived) or in any securities being
registered pursuant to any other registration statement filed by the
Company under the Act.
(v) To such counsel's knowledge, neither the Company nor any of
its subsidiaries nor Parent is, or with the giving of notice or
passage of time or both, would be, in violation of its Articles of
Incorporation or Bylaws, in each case as amended to date, or, in
default in any material respect under any indenture, mortgage, deed of
trust, loan agreement, lease or other agreement or instrument known to
such counsel to which the Company, any such subsidiary or Parent is a
party or to which any of their respective properties or assets is
subject.
(vi) To such counsel's knowledge and other than as disclosed in
or contemplated by the Prospectus, there is no litigation,
arbitration, claim, proceeding (formal or informal) or investigation
pending or threatened, in which the Company, any of its subsidiaries
or Parent is a party or of which any of their respective properties or
assets is the subject which, if determined adversely to the Company,
any such subsidiary or Parent, would individually or in the aggregate
have a material adverse effect on the financial position, results of
operations or business of the Company and its subsidiaries taken as a
whole; and, to the best of such counsel's knowledge, neither the
Company nor any of its subsidiaries nor Parent is in violation of, or
in default with respect to, any law, statute, rule, regulation, order,
judgment or decree, except as described in the Prospectus or such as
do not and will not individually or in the aggregate have a material
adverse effect on the financial position, results of operations or
business of the Company and its subsidiaries taken as a whole, nor is
the Company, any such subsidiary or Parent required to take any action
in order to avoid any such violation or default.
(vii) This Agreement has been duly authorized, executed and
delivered by each of the Company and Parent.
29
(viii) All offers and sales of the Company's capital stock prior
to the date hereof were at all relevant times duly registered or
exempt from the registration requirements of the Act, and were duly
registered or the subject of an available exemption from the
registration requirements of the applicable state securities or blue
sky laws, or any actions in respect thereof are barred by the
applicable statutes of limitations.
(ix) To such counsel's knowledge, the Company and each of its
subsidiaries have received all permits, licenses, franchises,
authorizations, registrations, qualifications and approvals
(collectively, "permits") of governmental or regulatory authorities
(including, without limitation, state and/or other insurance
regulatory authorities) as may be required of them to own their
properties and to conduct their businesses in the manner described in
the Prospectus, subject to such qualification as may be set forth in
the Prospectus; to the best of such counsel's knowledge, the Company
and each of its subsidiaries have fulfilled and performed all of their
material obligations with respect to such permits and no event has
occurred which allows, or after notice or lapse of time or both would
allow, revocation or termination thereof or result in any other
material impairment of the rights of the holder of any such permits,
subject in each case to such qualifications as may be set forth in the
Prospectus; and other than as described in the Prospectus, such
permits contain no restrictions that materially affect the ability of
the Company and its subsidiaries to conduct their businesses.
Such counsel shall also state that he has participated in the preparation
of the Registration Statement and the Prospectus and in conferences with
officers and other representatives of the Company, representatives of the
independent public accountants for the Company, and representatives of and
counsel to the Underwriters at which the contents of the Registration Statement,
the Prospectus and related matters were discussed and, although such counsel has
not passed upon or assumed any responsibility for the accuracy, completeness or
fairness of the statements contained in the Registration Statement or the
Prospectus, and although such counsel has not undertaken to verify independently
the accuracy or completeness of the statements in the Registration Statement or
the Prospectus and, therefore, would not necessarily have become aware of any
material misstatement of fact or omission to state a material fact, on the basis
of and subject to the foregoing, nothing has come to such counsel's attention to
lead him to believe that the Registration Statement, or any further amendment
thereto made prior to such Time of Delivery, on its effective date and as of
such Time of Delivery, contained or contains any untrue statement of a material
fact or omitted or omits to state any material fact required to be stated
therein or necessary to make the statements therein, in light of the
30
circumstances under which they were made, not misleading, or that the
Prospectus, or any amendment or supplement thereto made prior to such Time of
Delivery, as of its issue date and as of such Time of Delivery, contained or
contains any untrue statement of a material fact or omitted or omits to state a
material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading (provided that such
counsel need express no belief regarding the financial statements, the notes and
schedules thereto and other financial and statistical data contained in the
Registration Statement, any amendment thereto, or the Prospectus, or any
amendment or supplement thereto).
In rendering any such opinion, such counsel may rely, as to matters of
fact, to the extent such counsel deem proper, on certificates of officers of the
Company and Parent, and public officials and letters from officials of the NASD
and on the opinions of other counsel reasonably satisfactory to you and your
counsel as to matters which are governed by laws other than the laws of the
State of Indiana and the Federal laws of the United States; provided that such
counsel shall state in his opinion that he is so relying, and he is justified in
relying on such other opinions. Copies of such certificates of officers of the
Company and Parent and other opinions shall be addressed and furnished to the
Underwriters and furnished to counsel for the Underwriters.
(i) You shall have received an opinion, dated such Time of Delivery,
of Xxxxx Xxxxx, counsel for the Parent, in form and substance satisfactory
to you and your counsel, to the effect that:
(i) Parent has been duly incorporated and is validly existing
under the laws of Canada and has the corporate power and authority to
enter into this Agreement and perform its obligations hereunder.
(ii) The execution, delivery and performance by Parent of this
Agreement does not result in, and with the giving of notice or passage
of time or both, would not result in, a violation of its Articles of
Amalgamation or Bylaws, in each case as amended to date.
(iii) To such counsel's knowledge and other than as disclosed in
or contemplated by the Prospectus, there is no litigation,
arbitration, claim, proceeding (formal or informal) or investigation
pending or threatened, in which Parent is a party or of which any of
its properties or assets is the subject which, if determined adversely
to Parent, would individually or in the aggregate have a material
adverse effect on the financial position, results of operations or
business of the Company and its subsidiaries taken as a whole; and, to
such
31
counsel's knowledge, Parent is not in violation of, or in default with
respect to, any law, statute, rule, regulation, order, judgment or
decree, except as described in the Prospectus or such as do not and
will not individually or in the aggregate have a material adverse
effect on the financial position, results of operations or business of
the Company and its subsidiaries taken as a whole, nor is Parent
required to take any action in order to avoid any such violation or
default.
(iv) This Agreement has been duly authorized, executed and
delivered by Parent.
In rendering any such opinion, such counsel may rely, as to
matters of fact, to the extent such counsel may deem proper, on
certificates of officers of Parent and public officials. Copies of
such certificates of officers of Parent and other opinions shall be
addressed and furnished to the Underwriters and furnished to counsel
for the Underwriters.
(j) You shall have received from Coopers & Xxxxxxx L.L.P., letters
dated, respectively, the date hereof (or, if the Registration Statement has
been declared effective prior to the execution and delivery of this
Agreement, dated such effective date and the date of this Agreement) and
each Time of Delivery, in form and substance satisfactory to you, which
letters shall cover such matters as you shall request as well as:
(i) confirming that they are independent certified public
accountants (within the meaning of the Act) with respect to the
Company and its subsidiaries;
(ii) stating that, in their opinion, the financial statements,
certain summary and selected consolidated financial and operating
data, and any supplementary financial information and schedules
audited by them and included in the Prospectus or the Registration
Statement comply as to form in all material respects with the
applicable accounting requirements of the Act; and they have made a
review in accordance with standards established by the American
Institute of Certified Public Accountants of the unaudited
consolidated interim financial statements, and any supplementary
financial information and schedules, selected financial data, and/or
condensed financial statements derived from audited financial
statements of the Company for the periods specified in such letter,
and, as indicated in their report thereon, copies of which have been
furnished to the Representatives;
(iii) stating that, on the basis of specified procedures, which
included the procedures specified by the American Institute of
Certified Public Accountants ("AICPA") for a review of interim
financial information, as described in SFAS No. 71, Interim Financial
Information (with respect to the latest
32
unaudited consolidated financial statements of the Company included in
the Registration Statement), a reading of the latest available
unaudited interim consolidated financial statements of the Company
(with an indication of the date of the latest available unaudited
interim financial statements), a reading of the latest available
minutes of the meetings of the shareholders and the Board of Directors
of the Company and its subsidiaries, and audit and compensation
committees of such Boards, if any, and inquiries to certain officers
and other employees of the Company and its subsidiaries responsible
for operational, financial and accounting matters and other specified
procedures and inquiries, nothing has come to their attention that
would cause them to believe that (A) the unaudited consolidated
financial statements included in the Registration Statement (1) do not
comply in form in all material respects with the applicable accounting
requirements of the Act or (2) any material modifications should be
made to such unaudited financial statements for them to be in
conformity with generally accepted accounting principles; (B) at the
date of the latest available unaudited interim consolidated financial
statements of the Company and a specified date not more than five
business days prior to the date of such letter, there was any change
in the capital stock and other items specified by the Representatives,
increase in long-term debt, decrease in net current assets, total
assets, investments or shareholders' equity of the Company and its
subsidiaries, as compared with the amounts shown in the June 30, 1996
unaudited consolidated balance sheet of the Company included in the
Registration Statement, or that for the periods from June 30, 1996 to
the date of the latest available unaudited financial statements of the
Company and to a specified date not more than five days prior to the
date of the letter, there were any decreases, as compared to the
corresponding periods in the prior year, in gross premiums written,
net investment income, net realized capital gains, or total or per
share amounts of net income, or other items specified by the
Representatives, except in all instances for changes, decreases or
increases which the Registration Statement discloses have occurred or
may occur and except for such other changes, decreases or increases
which the Representatives shall in their sole discretion accept; or
(C) any other unaudited income statement data and balance sheet items
included in the Registration Statement do not agree with the
corresponding items in the unaudited financial statements from which
such data and items were derived, and any such unaudited data and
items were not determined on a basis substantially consistent with the
basis for the corresponding amounts in the audited consolidated
financial statements included or incorporated by reference in the
Registration Statement;
(iv) stating that, on the basis of a reading of the unaudited pro
forma financial statements included in the Registration Statement and
the Prospectus (the "pro forma financial statements"), carrying out
certain specified
33
procedures, inquiries of certain officials of the Company and its
subsidiary, Superior Insurance Company who have responsibility for
financial and accounting matters, and proving the arithmetic accuracy
of the application of the pro forma adjustments to the historical
amounts in the pro forma financial statements, nothing has come to
their attention that would cause them to believe that the pro forma
financial statements do not comply in all material respects with the
applicable accounting requirements of Rule 11- 02 of Regulation S-X or
that the pro forma adjustments have not been properly applied to the
historical amounts in the compilation of such statements;
(v) stating that they have compared specific dollar amounts,
numbers of shares, percentage of revenues and earnings statements and
other numerical data and financial information pertaining to the
Company and its subsidiaries set forth in the Registration Statement
and all of the dollar amounts and percentages in the Registration
Statement, in each case to the extent that such information is derived
from the accounting records subject to the internal control structure,
policies and procedures of the Company's and its subsidiaries'
accounting system, or has been otherwise derived in a manner permitted
by AICPA Statement on Auditing Standards No. 72 with the results
obtained from the application of specific readings, inquiries and
other appropriate procedures (which procedures do not constitute an
audit in accordance with generally accepted auditing standards) set
forth in the letter and with the accounting records of the Company and
its subsidiaries, and found them to be in agreement.
In the event that the letters referred to in this Section 7(h) set
forth any changes, decreases or increases in the items identified by
you, it shall be a further condition to the obligations of the
Underwriters that (i) such letters shall be accompanied by a written
explanation by the Company as to the significance thereof, unless the
Representatives deem such explanation unnecessary and (ii) such
changes, decreases or increases do not, in your sole judgment, make it
impracticable or inadvisable to proceed with the purchase, sale and
delivery of the Shares being delivered at such Time of Delivery as
contemplated by the Registration Statement, as amended as of the date
of such letter.
(k) Since the date of the latest audited financial statements
included in the Prospectus and except pursuant to claims made by
insureds in the ordinary course of business under policies of
insurance issued by the Company's subsidiaries which claims are
reasonably consistent with the Company's historical claims experience,
neither the Company nor any of its subsidiaries shall have sustained
(i) any loss or interference with their respective businesses from
fire, explosion, flood, hurricane or other calamity, whether or not
34
covered by insurance, or from any labor dispute or court or
governmental action, order or decree, otherwise than as disclosed in
or contemplated by the Prospectus, or (ii) any change, or any
development involving a prospective change (including, without
limitation, a change in management or control of the Company), in or
affecting the position (financial or otherwise), results of
operations, net worth or business prospects of the Company and its
subsidiaries, otherwise than as disclosed in or contemplated by the
Prospectus, the effect of which, in either such case, is in your sole
judgment so material and adverse as to make it impracticable or
inadvisable to proceed with the purchase, sale and delivery of the
Shares being delivered at such Time of Delivery as contemplated by the
Registration Statement, as amended as of the date hereof.
(l) Subsequent to the date hereof, there shall not have occurred
any of the following: (i) any suspension or limitation in trading in
securities generally on the New York Stock Exchange, or any setting of
minimum prices for trading on such exchange, or in the Common Stock of
the Company by the Commission or the National Association of
Securities Dealers Automated Quotation National Market System (except
for suspensions or limitations that last only a portion of one
business day); (ii) a moratorium on commercial banking activities in
New York, Indiana or Connecticut declared by either federal or state
authorities; or (iii) any outbreak or escalation of hostilities
involving the United States, declaration by the United States of a
national emergency or war or any other national or international
calamity or emergency if the effect of any such event specified in
this clause (iii) in your sole judgment makes it impracticable or
inadvisable to proceed with the purchase, sale and delivery of the
Shares being delivered at such Time of Delivery as contemplated by the
Registration Statement, as amended as of the date hereof.
(m) The Company shall have furnished to you at such Time of Delivery
certificates of the chief executive and chief financial officers of the
Company satisfactory to you, as to the accuracy in all material respects of
the respective representations and warranties of the Company herein at and
as of such Time of Delivery with the same effect as if made at such Time of
Delivery, as to the performance by the Company of all of their respective
obligations hereunder to be performed at or prior to such Time of Delivery,
and as to such other matters as you may reasonably request, and the Company
shall have furnished or caused to be furnished certificates of such
officers as to such matters as you may reasonably request.
(n) The representations and warranties of each of the Company and
Parent in this Agreement and in the certificates delivered by each of the
Company and Parent pursuant to this Agreement shall be true and correct in
all material respects when
35
made and on and as of each Time of Delivery as if made at such time, and
each of the Company and Parent shall have performed all covenants and
agreements and satisfied all conditions contained in this Agreement
required to be performed or satisfied by each of the Company and Parent at
or before such Time of Delivery.
(o) The Shares shall continue to be listed on the National Association
of Securities Dealers Automated Quotation National Market System.
(p) The Representatives shall have received copies of executed lock-up
agreements from each of Parent, Parent's principal shareholders and
Parent's officers and directors who own shares of common stock of Parent or
securities convertible into or exchangeable or exercisable for common stock
of Parent to the effect that such individuals and entities will not offer,
sell, contract to sell, or otherwise dispose of, any such shares of common
stock of Parent or securities convertible into or exchangeable or
exercisable for common stock of Parent for a period of 180 days after the
date of the Prospectus without the prior written consent of Advest, Inc.
8. Indemnification and Contribution.
(a) Each of the Company and Parent agrees to jointly and severally
indemnify and hold harmless each Underwriter against any losses, claims,
damages or liabilities, joint or several, to which such Underwriter may
become subject, under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are
based upon: (i) any untrue statement or alleged untrue statement made by
the Company or Parent in Section 1(a) of this Agreement; (ii) any untrue
statement or alleged untrue statement of any material fact contained in (A)
the Registration Statement or any amendment thereto, any Preliminary
Prospectus or the Prospectus or any amendment or supplement thereto, or (B)
any application or other document, or amendment or supplement thereto,
executed by the Company or based upon written information furnished by or
on behalf of the Company filed in any jurisdiction in order to qualify the
Shares under the securities or blue sky laws thereof or filed with the
Commission or any securities association or securities exchange (each an
"Application"); or (iii) the omission of or alleged omission to state in
the Registration Statement or any amendment thereto, any Preliminary
Prospectus, the Prospectus or any amendment or supplement thereto, or any
Application, a material fact required to be stated therein or necessary to
make the statements therein not misleading, and will reimburse each
Underwriter for any legal or other expenses reasonably incurred by such
Underwriter in connection with investigating, defending against or
appearing as a third-party witness in connection with any such loss, claim,
damage, liability or action; provided, however, that neither the
36
Company nor Parent shall be liable in any such case to the extent that any
such loss, claim, damage, liability or action (i) arises out of or is based
upon an untrue statement or alleged untrue statement or omission or alleged
omission made in the Registration Statement or any amendment thereto, any
Preliminary Prospectus, the Prospectus or any amendment or supplement
thereto or any Application in reliance upon and in conformity with written
information furnished to the Company by any Underwriter through you
expressly for use therein (which information is solely as set forth in
Section 1(a)(iii) hereof) or (ii) is asserted by a person who purchased any
of the Shares which are the subject thereof from an Underwriter and if a
copy of the Prospectus (as amended or supplemented) which corrected the
untrue statement or alleged untrue statement or omission or alleged
omission which is the basis of the loss, claim, damage, liability or action
for which indemnification is sought was not delivered or given to such
person at or prior to the written confirmation of the sale to such person.
Neither the Company nor Parent will, without the prior written consent of
the Representatives of the Underwriters, settle or compromise or consent to
the entry of any judgment in any pending or threatened claim, action, suit
or proceeding (or related cause of action or portion thereof) in respect of
which indemnification may be sought hereunder (whether or not any
Underwriter is a party to such claim, action, suit or proceeding), unless
such settlement, compromise or consent includes an unconditional release of
each Underwriter from all liability arising out of such claim, action, suit
or proceeding (or related cause of action or portion thereof).
(b) Each of the Company and Parent agrees to jointly and severally
indemnify and hold harmless each QIU, in its capacity as QIU, against any
losses, claims, damages or liabilities, joint or several, to which such QIU
may become subject, under the Act or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise out of
or are based upon: (i) any untrue statement or alleged untrue statement
made by the Company or Parent in Section 1(a) of this Agreement; (ii) any
untrue statement or alleged untrue statement of any material fact contained
in (A) the Registration Statement or any amendment thereto, any Preliminary
Prospectus or the Prospectus or any amendment or supplement thereto, or (B)
any Application; (iii) the omission of or alleged omission to state in the
Registration Statement or any amendment thereto, any Preliminary
Prospectus, the Prospectus or any amendment or supplement thereto, or any
Application, a material fact required to be stated therein or necessary to
make the statements therein not misleading; or (iv) other than as referred
to in the preceding clauses (i) through (iii), such QIU's actions as a QIU,
except insofar as such losses, claims, damages or liabilities (or actions
in respect thereof) arising under this clause (iv) result from such QIU's
willful misconduct or gross
37
negligence, and will reimburse each QIU for any legal or other expenses
reasonably incurred by such QIU in connection with investigating, defending
against or appearing as a third-party witness in connection with any such
loss, claim, damage, liability or action; provided, however, that neither
the Company nor Parent shall be liable in any such case to the extent that
any such loss, claim, damage, liability or action (i) arises out of or is
based upon an untrue statement or alleged untrue statement or omission or
alleged omission made in the Registration Statement or any amendment
thereto, any Preliminary Prospectus, the Prospectus or any amendment or
supplement thereto or any Application in reliance upon and in conformity
with written information relating to such QIU furnished to the Company by
or on behalf of such QIU in such capacity through you expressly for use
therein (it being understood and acknowledged by the Company that such
written information shall consist solely of the three sentences that are
set forth in the second to last paragraph of the section entitled
"Underwriting" in the Prospectus) or (ii) is asserted by a person who
purchased any of the Shares which are the subject thereof from an
Underwriter and if a copy of the Prospectus (as amended or supplemented)
which corrected the untrue statement or alleged untrue statement or
omission or alleged omission which is the basis of the loss, claim, damage,
liability or action for which indemnification is sought was not delivered
or given to such person at or prior to the written confirmation of the sale
to such person.
(c) Each Underwriter, severally but not jointly, agrees to
indemnify and hold harmless the Company and Parent against any losses,
claims, damages or liabilities to which the Company and Parent may
become subject under the Act or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise
out of or are based upon any untrue statement or alleged untrue
statement of any material fact contained in the Registration Statement
or any amendment thereto, any Preliminary Prospectus, the Prospectus
or any amendment or supplement thereto, or any Application or arise
out of or are based upon the omission or alleged omission to state
therein a material fact required to be stated therein or necessary to
make the statements therein not misleading, in each case to the
extent, but only to the extent, that such untrue statement or alleged
untrue statement or omission or alleged omission was made in reliance
upon and in conformity with written information furnished to the
Company by such Underwriter through you expressly for use therein; and
will reimburse the Company and Parent for any legal or other expenses
reasonably incurred by the Company and Parent in connection with
investigating or defending any such loss, claim, damage, liability or
action.
(d) Promptly after receipt by an indemnified party under
subsection (a), (b) or (c) above of notice of the commencement of any
action, such indemnified party shall, if a
38
claim in respect thereof is to be made against the indemnifying party
under such subsection, notify the indemnifying party in writing of the
commencement thereof; but the omission so to notify the indemnifying
party shall not relieve the indemnifying party from any liability
which it may have to any indemnified party otherwise than under such
subsection. In case any such action shall be brought against any
indemnified party and it shall notify the indemnifying party of the
commencement thereof, the indemnifying party shall be entitled to
participate therein and, to the extent that it shall wish, jointly
with any other indemnifying party similarly notified, to assume the
defense thereof, with counsel satisfactory to such indemnified party
(who shall not, except with the consent of the indemnified party, be
counsel to the indemnifying party); provided, however, that if the
defendants in any such action include both the indemnified party and
the indemnifying party and the indemnified party shall have reasonably
concluded that there may be one or more legal defenses available to it
or other indemnified parties which are different from or additional to
those available to the indemnifying party, the indemnifying party
shall not have the right to assume the defense of such action on
behalf of such indemnified party and such indemnified party shall have
the right to select separate counsel to defend such action on behalf
of such indemnified party. After such notice from the indemnifying
party to such indemnified party of its election so to assume the
defense thereof and approval by such indemnified party of counsel
appointed to defend such action, the indemnifying party will not be
liable to such indemnified party under this Section 8 for any legal or
other expenses, other than reasonable costs of investigation,
subsequently incurred by such indemnified party in connection with the
defense thereof, unless (i) the indemnified party shall have employed
separate counsel in accordance with the proviso to the next preceding
sentence or (ii) the indemnifying party has authorized the employment
of counsel for the indemnified party at the expense of the
indemnifying party. Nothing in this Section 8(d) shall preclude an
indemnified party from participating at its own expense in the defense
of any such action so assumed by the indemnifying party.
(e) If the indemnification provided for in this Section 8 is
unavailable to or insufficient to hold harmless an indemnified party
under subsection (a) or (c) above in respect of any losses, claims,
damages or liabilities (or actions in respect thereof) referred to
therein, then each indemnifying party shall contribute to the amount
paid or payable by such indemnified party as a result of such losses,
claims, damages or liabilities (or actions in respect thereof) in such
proportion as is appropriate to reflect the relative benefits received
by the Company and Parent on the one hand and the Underwriters on the
other from the offering of the Shares. If, however, the allocation
provided by the immediately preceding sentence is not permitted by
applicable law or if the indemnified party failed to
39
give the notice required under subsection (d) above, then each
indemnifying party shall contribute to such amount paid or payable by
such indemnified party in such proportion as is appropriate to reflect
not only such relative benefits but also the relative fault of the
Company and Parent on the one hand and the Underwriters on the other
in connection with the statements or omissions that resulted in such
losses, claims, damages or liabilities (or actions in respect
thereof), as well as any other relevant equitable considerations. The
relative benefits received by the Company and Parent on the one hand
and the Underwriters on the other shall be deemed to be in the same
proportion as the total net proceeds from the offering (before
deducting expenses) received by the Company and Parent bear to the
total underwriting discounts and commissions received by the
Underwriters. The relative fault shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of
a material fact or the omission or alleged omission to state a
material fact relates to information supplied by the Company and
Parent on the one hand or the Underwriters on the other and the
parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The
Company, Parent and the Underwriters agree that it would not be just
and equitable if contributions pursuant to this subsection (e) were
determined by pro rata allocation (even if the Underwriters were
treated as one entity for such purpose) or by any other method of
allocation which does not take account of the equitable considerations
referred to above in this subsection (e). The amount paid or payable
by an indemnified party as a result of the losses, claims, damages or
liabilities (or actions in respect thereof) referred to above in this
subsection (e) shall be deemed to include 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 subsection (e), no Underwriter shall be
required to contribute any amount in excess of the amount by which the
total price at which the Shares underwritten by it and distributed to
the public were offered to the public exceeds the amount of any
damages which such Underwriter has otherwise been required to pay by
reason of such 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 Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations in this subsection
(e) to contribute are several in proportion to their respective
underwriting obligations and not joint.
(f) If the indemnification provided for in this Section 8 is
unavailable to or insufficient to hold harmless a QIU under subsection
(b) above in respect of any losses, claims, damages or liabilities (or
actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the
40
amount paid or payable by such QIU as a result of such losses, claims,
damages or liabilities (or actions in respect thereof) in such
proportion as is appropriate to reflect the relative benefits received
by the Company and Parent on the one hand and the QIUs on the other
from the offering of the Shares. If, however, the allocation provided
by the immediately preceding sentence is not permitted by applicable
law or if the indemnified party failed to give the notice required
under subsection (d) above, then each indemnifying party shall
contribute to such amount paid or payable by such QIU in such
proportion as is appropriate to reflect not only such relative
benefits but also the relative fault of the Company and Parent on the
one hand and the QIUs on the other in connection with the statements
or omissions that resulted in such losses, claims, damages or
liabilities (or actions in respect thereof), as well as any other
relevant equitable considerations. The relative benefits received by
the Company and Parent on the one hand and the QIUs on the other shall
be deemed to be in the same proportion as the total net proceeds from
the offering (before deducting expenses) received by the Company and
Parent bear to the underwriting discounts and commissions received by
the QIUs. The relative fault shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of
a material fact or the omission or alleged omission to state a
material fact relates to information supplied by the Company and
Parent on the one hand or the QIUs on the other and the parties'
relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission. The Company, Parent and
the QIUs agree that it would not be just and equitable if
contributions pursuant to this subsection (f) were determined by pro
rata allocation (even if the QIUs were treated as one entity for such
purpose) or by any other method of allocation which does not take
account of the equitable considerations referred to above in this
subsection (f). The amount paid or payable by an indemnified party as
a result of the losses, claims, damages or liabilities (or actions in
respect thereof) referred to above in this subsection (f) shall be
deemed to include 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
subsection (f), no QIUs shall be required to contribute any amount in
excess of the amount by which the total price at which the Shares
underwritten by it as shown on Schedule I and distributed to the
public were offered to the public exceeds the amount of any damages
which such Underwriter has otherwise been required to pay by reason of
such 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 Act) shall be entitled to contribution
from any person who was not guilty of such fraudulent
misrepresentation. The QIUs' obligations in this subsection (f) to
contribute are several in
41
proportion to their respective underwriting obligations and not joint.
(g) The obligations of the Company and Parent under this Section
8 shall be in addition to any liability which the Company and Parent
may otherwise have and shall extend, upon the same terms and
conditions, and to each officer, director and employee of the
Underwriters (including the QIUs) and to each person, if any, who
controls any Underwriter (including the QIUs) within the meaning of
the Act or the Exchange Act; and the obligations of the Underwriters
(including the QIUs) under this Section 8 shall be in addition to any
liability which the respective Underwriters (including the QIUs) may
otherwise have and shall extend, upon the same terms and conditions,
to each officer and director of the Company and Parent and to each
person, if any, who controls the Company or Parent within the meaning
of the Act or the Exchange Act.
9. Default of Underwriters.
(a) If any Underwriter defaults in its obligation to purchase Shares
at a Time of Delivery, you may in your discretion arrange for you or
another party or other parties to purchase such Shares on the terms
contained herein. If within thirty-six (36) hours after such default by any
Underwriter you do not arrange for the purchase of such Shares, the Company
shall be entitled to a further period of thirty-six (36) hours within which
to procure another party or other parties satisfactory to you to purchase
such Shares on such terms. In the event that, within the respective
prescribed periods, you notify the Company that you have so arranged for
the purchase of such Shares, or the Company notifies you that it has so
arranged for the purchase of such Shares, you or the Company shall have the
right to postpone a Time of Delivery for a period of not more than seven
(7) days in order to effect whatever changes may thereby be made necessary
in the Registration Statement or the Prospectus, or in any other documents
or arrangements, and the Company agrees to file promptly any amendments to
the Registration Statement or the Prospectus that in your opinion may
thereby be made necessary. The cost of preparing, printing and filing any
such amendments shall be paid for by the Underwriters. The term
"Underwriter" as used in this Agreement shall include any person
substituted under this Section with like effect as if such person had
originally been a party to this Agreement with respect to such Shares.
(b) If, after giving effect to any arrangements for the purchase of
the Shares of a defaulting Underwriter or Underwriters by you or the
Company as provided in subsection (a) above, if any, the aggregate number
of such Shares which remains unpurchased does not exceed one-eleventh
(1/11) of the aggregate number of Shares to be purchased at such Time of
Delivery, then the Company shall have the right to require each
non-defaulting
42
Underwriter to purchase the number of Shares which such Underwriter agreed
to purchase hereunder at such Time of Delivery and, in addition, to require
each non-defaulting Underwriter to purchase its pro rata share (based on
the number of Shares which such Underwriter agreed to purchase hereunder)
of the Shares of such defaulting Underwriter or Underwriters for which such
arrangements have not been made.
10. Termination.
(a) This Agreement may be terminated with respect to the Company
Shares or any Optional Shares in the sole discretion of the Representatives
by notice to the Company given prior to the First Time of Delivery or any
Subsequent Time of Delivery, respectively, in the event that (i) any
condition to the obligations of the Underwriters set forth in Section 7
hereof has not been satisfied, or (ii) the Company shall have failed,
refused or been unable to deliver such party's respective Shares or the
Company or Parent shall have failed, refused or been unable to perform all
obligations and satisfy all conditions on their respective parts to be
performed or satisfied hereunder at or prior to such Time of Delivery, in
either case other than by reason of a default by any of the Underwriters.
If this Agreement is terminated pursuant to this Section 10(a), the Company
and/or Parent will reimburse the Underwriters severally upon demand for all
out-of-pocket expenses (including counsel fees and disbursements) that
shall have been incurred by them in connection with the proposed purchase
and sale of the Shares.
(b) If, after giving effect to any arrangements for the purchase of
the Shares of a defaulting Underwriter or Underwriters by you and the
Company as provided in Section 9(a), the aggregate number of such Shares
which remains unpurchased exceeds one-eleventh (1/11) of the aggregate
number of Shares to be purchased at such Time of Delivery, or if the
Company shall not exercise the right described in Section 9(b) to require
non-defaulting Underwriters to purchase Shares of a defaulting Underwriter
or Underwriters, then this Agreement (or, with respect to a Subsequent Time
of Delivery, the obligations of the Underwriters to purchase and of the
Company to sell the Optional Shares) shall thereupon terminate, without
liability on the part of any non-defaulting Underwriter or the Company,
except for the expenses to be borne by the Company and the Underwriters as
provided in Section 6 hereof and the indemnity and contribution agreements
in Section 8 hereof; but nothing herein shall relieve a defaulting
Underwriter from liability for its default.
11. Survival. The respective indemnities, agreements, representations,
warranties and other statements of the Company, Parent and their officers
and the several Underwriters, as set forth in this Agreement or made by or
on behalf of them, respectively, pursuant to this Agreement, shall remain
in full
43
force and effect, regardless of any investigation (or any statement as to
the results thereof) made by or on behalf of any Underwriter or any
controlling person referred to in Section 8(e) or the Company, Parent or
any officer or director or controlling person of the Company or Parent
referred to in Section 8(e), and shall survive delivery of and payment for
the Shares. The respective agreements, covenants, indemnities and other
statements set forth in Sections 6 and 8 hereof shall remain in full force
and effect, regardless of any termination or cancellation of this
Agreement.
12. Notices. All communications hereunder shall be in writing and, if
sent to any of the Underwriters, shall be mailed, delivered or telegraphed
and confirmed in writing to you in care of Advest, Inc., 00 Xxxxx Xxxxx
Xxxxxx, Xxxxxxxx, XX 00000, Attention: Xxxxx Xxxxx (with a copy to LeBoeuf,
Lamb, Xxxxxx & XxxXxx, L.L.P., 000 Xxxx 00xx Xxxxxx, Xxx Xxxx, XX 00000,
Attention: Lars Bang-Xxxxxx, Esquire); and if sent to the Company, shall be
mailed, delivered or telegraphed and confirmed in writing to Xxxxxx
International Group, Inc., 0000 Xxxxxxxx Xxxxx, Xxxxxxxxxxxx, XX 00000,
Attention: Xxxx X. Xxxxxx (with a copy to Xxxxxx & Xxxxxxxxx, 00 Xxxxx
Xxxxxxxx Xxxxxx, Xxxxxxxxxxxx, XX 00000, Attention: Xxxxxxxxx Bridge,
Esquire).
13. Representatives. You will act for the several Underwriters in
connection with the transactions contemplated by this Agreement, and any
action under this Agreement taken by you jointly or by Advest, Inc. will be
binding upon all the Underwriters.
14. Binding Effect. This Agreement shall be binding upon, and inure
solely to the benefit of, the Underwriters, the Company, Parent and to the
extent provided in Sections 8 and 10 hereof, the officers, directors and
employees and controlling persons referred to therein and their respective
heirs, executors, administrators, successors and assigns, and no other
person shall acquire or have any right under or by virtue of this
Agreement. No purchaser of any of the Shares from any Underwriter shall be
deemed a successor or assign by reason merely of such purchase.
15. Governing Law. This Agreement shall be governed by and construed
in accordance with the laws of the State of New York without giving effect
to any provisions regarding conflicts of laws.
16. Counterparts. This Agreement may be executed by any one or more of
the parties hereto in any number of counterparts, each of which shall be
deemed to be an original, but all such counterparts shall together
constitute one and the same instrument.
44
If the foregoing is in accordance with your understanding of our agreement,
please sign and return to us one of the counterparts hereof, and upon the
acceptance hereof by Advest, Inc., on behalf of each of the Underwriters, this
letter will constitute a binding agreement among the Underwriters, Parent and
the Company. It is understood that your acceptance of this letter on behalf of
each of the Underwriters is pursuant to the authority set forth in the Agreement
among Underwriters, a copy of which shall be submitted to the Company for
examination, upon request, but without warranty on your part as to the authority
of the signers thereof.
Very truly yours,
XXXXXX INTERNATIONAL GROUP, INC.
By:/s/ Xxxx X. Xxxxxx
--------------------------------
Name: Xxxx X. Xxxxxx
Title: Chief Executive Officer
GORAN CAPITAL INC.
By:/s/ Xxxx X. Xxxxxx
--------------------------------
Name:
Title:
The foregoing Agreement is hereby confirmed and accepted as of the date first
written above at Hartford, Connecticut.
ADVEST, INC.
MESIROW FINANCIAL, INC.
By: ADVEST, INC.
By:/s/ Xxxxxx X. Xxxxxxxx
Name: Xxxx X. Xxxxxxxx
Title: Group Vice President
Director Investment Banking
On behalf of each of the Underwriters
45
JOINDER
The following subsidiary of the Company, intending to be legally bound,
hereby joins this Agreement for purposes of Sections 1 and 8 hereof.
IGF HOLDINGS, INC.
By:/s/ Xxxxx X. Xxxxx
--------------------------------
Title: VP & Sec.
46
SCHEDULE I
Number of
Optional
Total Number Shares to be
of Company Purchased if
Shares Maximum
to be Option
Underwriter Purchased Exercised
Advest, Inc. 920,000 138,000
Mesirow Financial, Inc. 920,000 138,000
Xxxx Xxxxxx Xxxxxxxx Inc. 60,000 9,000
Deutsche Xxxxxx Xxxxxxxx Inc. 60,000 9,000
Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities
Corporation 60,000 9,000
Dresdner Kleinwort Xxxxxx North America LLC 60,000 9,000
X.X. Xxxxxxx & Sons, Inc. 60,000 9,000
Xxxxxxx, Sachs & Co. 60,000 9,000
Xxxxxx Brothers Inc. 60,000 9,000
Xxxxxx Xxxxxxx & Co. Incorporated 60,000 9,000
Xxxxxxxxxxx & Co., Inc. 60,000 9,000
NatCity Investments, Inc. 60,000 9,000
X.X. Xxxxxxxx & Co. 35,000 5,250
Xxxxx Xxxxxx & Co., Inc. 35,000 5,250
City Securities Corporation 35,000 5,250
Xxxxxxxx & Xxxxxxxx, Inc. 35,000 5,250
EVEREN Securities, Inc. 35,000 5,250
First of Michigan Corporation 35,000 5,250
Friedman, Billings, Xxxxxx & Co., Inc. 35,000 5,250
Xxxxxx Xxxxxxxxxx Xxxxx Inc. 35,000 5,250
Ladenburg, Xxxxxxxx & Co. Inc. 35,000 5,250
Xxxx Xxxxx Xxxx Xxxxxx, Incorporated 35,000 5,250
XxXxxxxx & Company Securities, Inc. 35,000 5,250
Xxxxxx Xxxxxx & Company, Inc. 35,000 5,250
The Xxxxxxxx-Xxxxxxxx Company, Inc. 35,000 5,250
Sands Brothers & Co., Ltd. 35,000 5,250
Xxxxxxxx Inc. 35,000 5,250
Wheat, First Securities, Inc. 35,000 5,250
--------- -------
Total 3,000,000 450,000
========= =======
