Exhibit 1.1
Common Stock
UNDERWRITING AGREEMENT
DELTA FINANCIAL CORPORATION
[Date]
To the Representatives
named in Schedule I
hereto of the Underwriters
named in Schedule II hereto
[Address]
Ladies and Gentlemen:
Delta Financial Corporation, a Delaware corporation (the "Company"),
proposes, subject to the terms and conditions stated herein (including Schedule
I), to issue and sell to the several Underwriters named in Schedule II hereto
(the "Underwriters"), and certain stockholders of the Company named in Schedule
III hereto (the "Selling Stockholders") severally and not jointly propose,
subject to the terms and conditions stated herein, to sell to the Underwriters,
an aggregate of [____________] shares of the Company's Common Stock, par value
$[___] per share (the "Common Stock"), of which (a) [____________] shares are to
be issued and sold by the Company, and (b) [_________] shares are to be sold by
the Selling Stockholders, each Selling Stockholder selling the number of shares
set forth opposite such Selling Stockholder's name in Schedule II hereto. The
aggregate of [__________] shares to be purchased from the Company and the
Selling Stockholders are called the "Firm Shares." [In addition, the Company has
agreed to sell to the Underwriters, upon the terms and conditions stated herein,
up to an additional [________] shares of Common Stock (the "Additional Shares")
to cover over-allotments by the Underwriters, if any.] [In addition, the Selling
Stockholders have severally and not jointly agreed to sell to the Underwriters,
upon the terms and conditions stated herein, up to an additional [________]
shares of Common Stock (the "Additional Shares") to cover over-allotments by the
Underwriters, if any, each Selling Stockholder selling up to the amount set
forth opposite such Selling Stockholder's name in Schedule III hereto.] [In
addition, the Company has agreed to sell to the Underwriters, upon the terms and
conditions stated herein, up to an additional [________] shares of Common Stock
and the Selling Stockholders have severally and not jointly agreed to sell to
the Underwriters, upon the terms and conditions stated herein, up to an
additional [________] shares of Common Stock to cover over-allotments by the
Underwriters, if any, each Selling Stockholder selling up to the amount set
forth opposite such Selling Stockholder's name in Schedule II hereto. The
additional [_______] shares to be sold by the Company and the additional
[_______] shares to be sold by the Selling Stockholders are collectively
referred to in
this Agreement as the "Additional Shares."] The Firm Shares and the Additional
Shares are collectively referred to in this Agreement as the "Shares."
_______________________________ [and _______________ are] is acting as the
representative[s] of the several Underwriters and in such capacity is [are]
referred to in this Agreement as the "Representative[s]."
1. REPRESENTATIONS AND WARRANTIES.
1.1 REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company
represents and warrants to and agrees with each of the Underwriters that:
(a) The Company meets the requirements for use of Form S-2 under
the Securities Act of 1933, as amended (the "Act"), and has filed with the
Securities and Exchange Commission (the "Commission") a registration statement
on such Form (the file number of which is set forth in Schedule I hereto), which
has become effective, for the registration under the Act of the Shares. The
Company proposes to file with the Commission pursuant to Rule 424 or Rule 434
under the Act a supplement to the form of prospectus included in such
registration statement relating to the Shares and the plan of distribution
thereof and has previously advised you of all further information (financial and
other) with respect to the Company to be set forth therein. Such registration
statement, including the exhibits thereto, as amended at the date of this
Agreement, is hereinafter called the "Registration Statement;" such prospectus
in the form in which it appears in the Registration Statement is hereinafter
called the "Basic Prospectus;" and such supplemented form of prospectus, in the
form in which it shall be filed with the Commission pursuant to Rule 424 or Rule
434 (including the Basic Prospectus as so supplemented) is hereinafter called
the "Final Prospectus." Any preliminary form of the Final Prospectus which has
heretofore been filed pursuant to Rule 424 hereinafter is called the
"Preliminary Final Prospectus." Any reference herein to the Registration
Statement, the Basic Prospectus, any Preliminary Final Prospectus or the Final
Prospectus shall be deemed to refer to and include the documents incorporated by
reference therein pursuant to Item 12 of Form S-2 which were filed under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), on or before
the date of this Agreement, or the issue date of the Basic Prospectus, any
Preliminary Final Prospectus or the Final Prospectus, as the case may be; and
any reference herein to the terms "amend," "amendment" or "supplement" with
respect to the Registration Statement, the Basic Prospectus, any Preliminary
Final Prospectus or the Final Prospectus shall be deemed to refer to and include
the filing of any document under the Exchange Act after the date of this
Agreement, or the issue date of the Basic Prospectus, any Preliminary Final
Prospectus or the Final Prospectus, as the case may be, and deemed to be
incorporated therein by reference.
(b) As of the date hereof, when the Final Prospectus is first
filed pursuant to Rule 424 or Rule 434 under the Act, when, prior to the Closing
Date (as hereinafter defined), any amendment to the Registration Statement
becomes effective (including the filing of any document incorporated by
reference in the Registration Statement), when any supplement to the Final
Prospectus is filed with the Commission and at the Closing Date (as hereinafter
defined), (i) the Registration Statement as amended as of any such time, and the
Final Prospectus, as amended or supplemented as of any such time, will comply in
all material respects with the applicable requirements of the Act, and the
Exchange Act and the respective rules thereunder, (ii) the Registration
Statement, as amended as of any such time, will not contain any
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untrue statement of a material fact or omit to state any material fact required
to be stated therein or necessary in order to make the statements therein not
misleading and (iii) the Final Prospectus, as amended or supplemented as of any
such time, will not contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary in order to
make the statements therein, in light of the circumstances under which they were
made, not misleading; provided, however, that the Company makes no
representations or warranties as to the information contained in or omitted from
the Registration Statement or the Final Prospectus or any amendment thereof or
supplement thereto in reliance upon and in conformity with information furnished
in writing to the Company by or on behalf of any Underwriter through the
Representatives specifically for use in connection with the preparation of the
Registration Statement and the Final Prospectus.
(c) Each direct and indirect subsidiary of the Company is set
forth on Schedule IV attached hereto (each, a "Subsidiary"). All the outstanding
shares of capital stock or other equity interests of the Company and each
Subsidiary have been duly authorized and validly issued, are fully paid and
nonassessable and are free of any preemptive or similar rights.
(d) Each of the Company and the Subsidiaries is a corporation
duly organized, validly existing and in good standing under the laws of its
jurisdiction of incorporation with full corporate power and authority to own,
lease and operate its properties and engage in the business in which it is
engaged or in which it proposes to engage as described in the Registration
Statement and any Final Prospectus. The Company is duly registered and qualified
to do business as a foreign corporation (or other entity) in good standing in
each jurisdiction where the character, location, ownership or leasing of its
properties (owned, leased or licensed) or the nature or conduct of its business
requires such registration or qualification, except where the failure to be so
qualified would not, individually or in the aggregate, result in a material
adverse effect on or affecting the business, operations, assets, properties,
condition (financial or other), stockholders' equity, or results of operations
of the Company and its Subsidiaries taken as a whole (a "Material Adverse
Effect").
(e) There are no legal or governmental proceedings pending
against the Company or any Subsidiary or, to the knowledge of the Company,
threatened against any of them or to which the Company or any Subsidiary or to
which any of the respective properties of the Company or any Subsidiary is
subject which are not disclosed in the Registration Statement or any Final
Prospectus and which, if adversely decided, would have a Material Adverse Effect
or materially adversely affect the issuance of the Shares or the consummation of
any of the transactions contemplated by this Agreement. There are no agreements,
contracts, indentures, leases or other instruments of the Company or any
Subsidiary that are material to the Company and the Subsidiaries, taken as a
whole, which are not described in the Registration Statement or any Final
Prospectus, neither the Company nor any Subsidiary is involved in any strike,
job action or labor dispute with any group of its employees which would
reasonably be expected to have a Material Adverse Effect, and, to the knowledge
of the Company, no such action or dispute is threatened.
(f) KPMG LLP, the accountants who have expressed their opinion
with respect to the financial statements (including the related notes and
supporting schedules) of the Company filed with the Commission as a part of the
Registration Statement and any Final
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Prospectus, are, with respect to the Company and each of its Subsidiaries,
independent public accountants as required by the Act and the Exchange Act.
(g) The financial statements of the Company, together with the
related notes thereto, which are incorporated by reference into the Registration
Statement and any Final Prospectus, present fairly the financial position and
the results of operations, changes in stockholders' equity and changes in cash
flows of the Company as of the respective dates and for the respective periods
specified therein. All of such financial statements and related notes have been
prepared in conformity with generally accepted accounting principles applied on
a consistent basis throughout the periods involved and comply as to form in all
material respects with the applicable accounting requirements included in
Regulation S-X under the Act. [The supporting schedules, the "Summary Financial
Data", the "Selected Financial Data" and the tables included in the Registration
Statement and any Final Prospectus fairly present the information purported to
be shown thereby at the respective dates thereof and for the respective periods
covered thereby. No other financial statements or supporting schedules are
required by the Act or Regulation S-X to be included therein.]
(h) Subsequent to the respective dates as of which information is
given in the Registration Statement or any Final Prospectus, there has not been
(i) any loss or adverse change, or any development which could reasonably be
expected to have a Material Adverse Effect on the Company and its Subsidiaries
taken as a whole, (ii) any transaction entered into by each of the Company and
the Subsidiaries, except transactions in the ordinary course of business; (iii)
any obligation, direct or contingent, incurred by each of the Company and the
Subsidiaries which is material to each of the Company and the Subsidiaries taken
as a whole, except for liabilities or obligations which are reflected in the
Registration Statement or any Final Prospectus, (iv) any change in the capital
stock or outstanding indebtedness of the Company, or (v) any dividend or
distribution of any kind declared, paid or made on the capital stock of the
Company, which in any case described in clauses (i), (ii), (iii), (iv) or (v)
above, could reasonably be expected to, individually or in the aggregate, have a
Material Adverse Effect on the Company and its Subsidiaries taken as a whole or
materially and adversely affect the ability of the Company to perform its
obligations under this Agreement.
(i) Each of the Company and the Subsidiaries has good and
marketable title to all property (real and personal) described in the
Registration Statement and any Final Prospectus as being owned by it, free and
clear of all liens, claims, security interests or other encumbrances, except
such as are described in the Registration Statement or any Final Prospectus or
could not, in the aggregate, reasonably be expected to have a Material Adverse
Effect, and all the property described in the Registration Statement and any
Final Prospectus as being held under lease by each of the Company and the
Subsidiaries is held by it under valid, subsisting and enforceable leases,
except as the enforcement thereof may be limited by bankruptcy, insolvency, or
similar laws affecting the enforcement of creditors' rights generally and
subject to the applicability of general principles of equity.
(j) The Company has all the requisite corporate power and
authority to execute, deliver and perform its obligations under this Agreement;
the execution and delivery of, and the performance by the Company of its
obligations under this Agreement have been duly
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and validly authorized by the Company and this Agreement, as of the Closing
Date, will have been duly executed and delivered by the Company and will
constitute the valid and legally binding agreement of the Company, enforceable
against the Company in accordance with its terms, except as the enforcement
hereof may be limited by bankruptcy, insolvency or other similar laws affected
the enforcement of creditors' rights generally and subject to the applicability
of general principles of equity, and except as rights to indemnity and
contribution hereunder may be limited by Federal or state securities laws of
principles of public policy.
(k) Each of the Company and the Subsidiaries has such permits,
licenses, franchises, certificates of need and other approvals or authorizations
of governmental or regulatory authorities ("Permits") as are necessary under
applicable law to own their respective properties and to conduct their
respective businesses in the manner described in the Registration Statement or
any Final Prospectus, except to the extent that the failure to have such Permits
could not reasonably be expected to have a Material Adverse Effect; each of the
Company and the Subsidiaries has fulfilled and performed in all material
respects all of its obligations with respect to the Permits, and, to the
knowledge of the Company, no event has occurred which allows, or after notice or
lapse of time would allow, revocation or termination thereof or results in any
other material impairment of the rights of the holder of such Permit, subject in
each case to such qualification as may be set forth in the Registration
Statement or any Final Prospectus and except to the extent that any such
revocation or termination, individually or in the aggregate, could not
reasonably be expected to have a Material Adverse Effect.
(l) None of the Company or any Subsidiary is (i) in violation of
its certificate of incorporation, as amended, or articles of organization, as
amended, or bylaws or other organizational documents or of any law, ordinance,
administrative or governmental rule or regulation applicable to it or of any
decree of any court or governmental agency or body having jurisdiction over it,
except where any such violation or violations in the aggregate could not
reasonably be expected to have a Material Adverse Effect, or (ii) in default in
the performance of any obligation, agreement or condition contained in any bond,
debenture, note or any other evidence of indebtedness or in any agreement,
indenture, lease or other instrument to which the Company or any Subsidiary is a
party or by which any of them or any of their respective properties may be
bound, except as disclosed in the Registration Statement or any Final Prospectus
or where any such default or defaults in the aggregate would not reasonably be
expected to have a Material Adverse Effect.
(m) Each of the Company and the Subsidiaries owns, possesses,
licenses or possesses adequate rights to use all patents, trademarks, trademark
registrations, service marks, service xxxx registrations, tradenames,
copyrights, licenses, inventions, trade secrets and rights described in the
Registration Statement and any Final Prospectus as being owned by it or
necessary for the conduct of its business, and that the Company has not received
a claim to the contrary (a "Claim") or any challenge (a "Challenge") by any
other person to the rights of each of the Company and the Subsidiaries with
respect to the foregoing, except for such Claims and Challenges which could not
reasonably be expected to have a Material Adverse Effect.
(n) Except as disclosed in the Registration Statement or any
Final Prospectus, the Company and the Subsidiaries have filed all tax returns
required to be filed (other
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than filings being contested in good faith), which returns are true and correct
in all material respects, and neither of the Company nor any Subsidiary is in
default in the payment of any taxes which were payable pursuant to said returns
or any assessments with respect thereto (other than taxes being contested in
good faith), except where the failure to file such returns and make such
payments (whether or not being contested in good faith) would not, individually
or in the aggregate, reasonably be expected to have a Material Adverse Effect.
(o) Except as disclosed in the Company's filings with the
Commission, none of the properties owned, operated or used by the Company has
suffered a release of any Hazardous Materials that, under any Environmental Law,
(i) would impose liability on the Company that is likely to have a Material
Adverse Effect or (ii) is likely to result in the imposition of a lien on any
assets owned, directly or indirectly, by the Company. To the Company's
knowledge, it is in compliance with, and is not subject to any existing, pending
threatened impending litigation, proceeding, claim or demand by any governmental
agency or authority or other person with respect or pursuant to any
Environmental Law, except any which, if adversely determined would not have a
Material Adverse Effect. As used herein, "Environmental Laws" means the common
law and all federal, state, local and foreign laws, codes and ordinances
relating to the environment, health and safety and all rules and regulations
promulgated thereunder, including, without limitation laws relating to
emissions, discharges, releases or threatened releases of pollutants,
contaminants, chemicals, or industrial, toxic or hazardous substances or wastes
into the environment (including, without limitation, air, surface water, ground
water, land surface or subsurface strata) or otherwise relating to the
manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of pollutants, contaminants, chemicals, or industrial,
solid, toxic or hazardous substances or wastes; and "Hazardous Material"
includes, without limitation, the following "Environmental Laws": (i) all
substances which are designated pursuant to Section 311(b)(2)(A) of the Federal
Water Pollution Control Act ("FWPCA"), 33 U.S.C. ss. 1251 ET. SEQ.; (ii) any
element, compound, mixture, solution, or substance which is designated pursuant
to Section 102 of the Comprehensive Environmental Response, Compensation and
Liability Act ("CERCLA"), 42 U.S.C. ss. 9601 et. seq.; (iii) any hazardous waste
having the characteristics which are identified under or listed pursuant to
Section 3001 of the Resource Conservation and Recovery Act ("RCRA"), 42 U.S.C.
ss. 6901 ET. SEQ.; (iv) any toxic pollutant listed under Section 307(a) of
FWPCA; (v) any hazardous air pollutant which is listed under Section 7 of the
Toxic Substances Control Act, 15 U.S.C. ss. 2601 ET. SEQ.; and (vii) petroleum,
petroleum products, petroleum by-products, petroleum decomposition by-products,
and waste oil, and any other substances or wastes subject to regulation under
Environmental Laws.
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(p) None of the Company or the Subsidiaries has any liability for
any prohibited transaction or funding deficiency or any complete or partial
withdrawal liability with respect to any pension, profit sharing or other plan
which is subject to the Employee Retirement Income Security Act of 1974, as
amended ("ERISA"), to which the Company or any of the Subsidiaries makes or ever
has made a contribution and in which any employee of the Company or any
Subsidiary is or has ever been a participant. With respect to such plans, the
Company and each Subsidiary is in compliance in all material respects with all
applicable provisions of ERISA.
(q) The Company maintains a system of internal accounting
controls sufficient to provide reasonable assurances that (i) transactions of
the Subsidiaries are executed in accordance with management's general or
specific authorization, (ii) transactions are appropriately recorded to permit
preparation of financial statements in conformity with generally accepted
accounting principles and to maintain accountability for assets, (iii) access to
assets is permitted only in accordance with management's general or specific
authorization, and (iv) the recorded accountability for assets is compared with
existing assets at reasonable intervals and appropriate action is taken with
respect to any differences.
(r) None of (i) the issuance, offer, sale or delivery of the
Shares, (ii) the execution, delivery or performance of this Agreement by the
Company, or (iii) the consummation by the Company of the transactions
contemplated hereby (a) requires any consent, approval, registration,
authorization or other order of, or registration or filing with (each, a
"Consent"), any court, regulatory body, administrative agency or other
governmental body, agency or official (except for compliance with the securities
or Blue Sky laws of various jurisdictions or the failure to obtain which could
not reasonably be expected to have a Material Adverse Effect or materially
adversely affect the consummation of the transactions contemplated hereby) or
conflicts or will conflict with or constitutes or will constitute a breach of,
or a default under, the certificate or articles of incorporation or bylaws, or
other organizational documents, of the Company or any Subsidiary, except any
such conflicts and breaches that in the aggregate could not reasonably be
expected to have a Material Adverse Effect or (b) conflicts or will conflict
with or constitutes or will constitute a breach of or a default under, any
agreement, indenture, lease or other instrument to which the Company or any
Subsidiary is a party or by which any of them or any of their respective
properties may be bound, except as disclosed in the Registration Statement or
any Final Prospectus or any such conflicts, breaches or defaults that in the
aggregate could not reasonably be expected to have a Material Adverse Effect, or
(c) violates or will violate any statute, law, regulation or judgment,
injunction, order or decree applicable to the Company or any Subsidiary or any
of their respective properties, except any such violations that in the aggregate
could not reasonably be expected to have a Material Adverse Effect, or (d) will
result in the creation or imposition of any lien, charge or encumbrance upon any
property or assets of the Company or any Subsidiary pursuant to the terms of any
agreement or instrument to which any of them is a party or by which any of them
may be bound or to which any of their property or assets is subject, other than
as disclosed in the Registration Statement or any Final Prospectus or which
could not in the aggregate be expected to have a Material Adverse Effect.
(s) The Company has duly and validly authorized the issuance and
sale of the Shares and when delivered the Shares will constitute valid and
binding obligations of the Company. The description of the Shares in the
Registration Statement and any Final Prospectus is accurate in all material
respects.
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(t) The Company is not now, and as a result of the offer and sale
of the Shares in the manner contemplated in this Agreement, the Registration
Statement and any Final Prospectus and the application of the net proceeds of
such sale as described in the section entitled "Use of Proceeds" of the
Registration Statement and any Final Prospectus, will not be, an "investment
company" or an "affiliated person" of, or "promoter" or "principal underwriter"
for, an "investment company" within the meaning of the Investment Company Act of
1940, as amended (the "Investment Company Act"), without taking account of any
exemption arising out of the number or type of holders of the Company's
securities.
(u) None of the Company nor any of its affiliates (as defined in
Rule 501 (b) of Regulation D ("Regulation D") under the Act) has directly, or
through any agent taken any action designed to cause or to result in or that has
constituted, or might reasonably be expected to cause or result in or
constitute, under the Exchange Act, or otherwise, the stabilization or
manipulation of the price of any security of the Company to facilitate the sale
or resale of the Shares.
(v) The Company has not distributed and will not distribute prior
to the later of (A) the Additional Closing Date (as defined below) and (B) the
completion of the distribution of the Shares by the Underwriters and dealers,
any offering material (including, without limitation, content on its Website, if
any, that may be deemed to be offering material) in connection with the offering
and sale of the Shares other than the Basic Prospectus and each Final
Prospectus.
(w) No holder of any security of the Company, which by reason of
the filing of the Registration Statement or otherwise in connection with the
sale of the Shares contemplated hereby, has the right to request or demand
registration of any security of the Company because of the transactions
contemplated hereby, except for the holders of shares of Common Stock acquired
upon the exercise of warrants prior to the Company's redemption on October 30,
2003 of its 9.5% senior secured notes due 2004 (the "Redemption").
(x) Except as disclosed in the Registration Statement or any
Final Prospectus, subsequent to the date as of which such information is given
in the Registration Statement or any Final Prospectus, neither the Company nor
any Subsidiary has incurred any liability or obligation direct or contingent, or
entered into any transaction, not in the ordinary course of business, that is
material to the Company and the Subsidiaries, taken as a whole, and there has
not been any material change in the capital stock, or material increase in the
short-term or long-term debt of the Company or any Subsidiary.
(y) Neither the Company nor any Subsidiary nor, to the knowledge
of the Company, any employee or agent of the Company or any Subsidiary has made
any payment of funds or received or retained any funds in violation of any law,
rule or regulation, which violation could reasonably be expected to have a
Material Adverse Effect.
(z) The Common Stock is registered pursuant to Section 12(b) of
the Exchange Act and is quoted on the American Stock Exchange, and the Company
has taken no action designed to, or likely to have the effect of, terminating
the registration of the Common Stock under the Exchange Act or delisting the
Common Stock from the American Stock Exchange ("AMEX"), nor has the Company
received any notification that the Commission or the AMEX is contemplating
terminating such registration or listing.
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(aa) The Company has timely and properly filed with the
Commission all reports and other documents required to have been filed by it
with the Commission pursuant to the Act, the Regulations, the Exchange Act and
the rules and regulations.
(bb) Except as described in the Registration Statement and any
Final Prospectus, and except in connection with exercises of outstanding options
and warrants, the Company has not sold or issued any shares of capital stock
within the six month period preceding the date of any Final Prospectus, all of
which sales and issuances were made in compliance with the Act and the
Regulations.
(cc) The Company meets the requirements for use of Form S-2 under
the Regulations.
1.2 REPRESENTATIONS AND WARRANTIES OF THE SELLING STOCKHOLDERS. Each
Selling Stockholder hereby represents and warrants, severally as to itself and
not jointly, to each Underwriter on the date hereof, and shall be deemed to
represent and warrant to each Underwriter on the Closing Date and the Additional
Closing Date, that:
(a) Such Selling Stockholder is the lawful owner of the Shares to
be sold by such Selling Stockholder pursuant to this Agreement and has, and on
the Closing Date and the Additional Closing Date, as the case may be, will have,
good and valid title to such Shares, free of all restrictions on transfer,
liens, encumbrances, security interests, equities and claims whatsoever.
(b) Such Selling Stockholder has, and on the Closing Date and the
Additional Closing Date, as the case may be, will have, full legal right, power
and authority, and all authorization and approval required by law, to enter into
(i) this Agreement, (ii) the Custody Agreement signed by such Selling
Stockholder and [_______________], as custodian (the "Custodian"), relating to
the deposit of the Shares to be sold by such Selling Stockholder (the "Custody
Agreement") and (iii) the Power of Attorney appointing certain individuals named
therein as such Selling Stockholder's attorneys-in-fact (the "Attorneys") to the
extent set forth therein relating to the transactions contemplated hereby and by
the Final Prospectus (the "Power of Attorney") to sell, assign, transfer and
deliver the Shares to be sold by such Selling Stockholder in the manner provided
herein.
(c) Each of the Agreement, the Custody Agreement and Power of
Attorney of such Selling Stockholder has been duly authorized, executed and
delivered by such Selling Stockholder and is a valid and binding agreement of
such Selling Stockholder, enforceable as to such Selling Stockholder in
accordance with its terms, except to the extent enforceability may be limited by
(i) the application of bankruptcy, reorganization, insolvency and other laws
affecting creditors' rights generally and (ii) equitable principles being
applied at the discretion of a court before which a proceeding may be brought,
except as rights to indemnity and contribution hereunder may be limited by
federal or state securities laws and, pursuant to
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such Power of Attorney, such Selling Stockholder has, among other things,
authorized the Attorneys, or any one of them, to execute and deliver on such
Selling Stockholder's behalf this Agreement and any other document that they, or
any one of them, may deem necessary or desirable in connection with the
transactions contemplated hereby and thereby and to deliver the Shares to be
sold by such Selling Stockholder pursuant to this Agreement.
(d) None of the sale of the Shares by such Selling Stockholder,
the execution, delivery or performance by such Selling Stockholder of this
Agreement, the Custody Agreement and Power of Attorney of such Selling
Stockholder by or on behalf of such Selling Stockholder, the compliance by such
Selling Stockholder with all the provisions hereof and thereof nor the
consummation by such Selling Stockholder of the transactions contemplated hereby
and thereby (i) requires any consent, approval, authorization or other order of,
or registration or filing with, any court, regulatory body or administrative
agency or other governmental body, agency or official (except such as may be
required under the securities or Blue Sky laws of the various states), (ii)
conflicts with or will conflict with or constitutes or will constitute a breach
of or a default under, the organizational documents of such Selling Stockholder,
if such Selling Stockholder is not an individual, or any agreement, indenture,
lease or other instrument to which such Selling Stockholder is a party or by
which such Selling Stockholder or any property of such Selling Stockholder is
bound or (iii) violates any statute, law, regulation, ruling, filing, judgment,
injunction, order or decree applicable to such Selling Stockholder or any
property of such Selling Stockholder.
(e) The information in the Final Prospectus under the caption
"Selling Stockholders" that specifically relates to such Selling Stockholder
does not, and will not on the Closing Date or the Additional Closing Date, if as
the case may be, contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading.
(f) At any time prior to the Closing Date or the Additional
Closing Date, as the case may be, if there is any change in the information
referred to in Section 1.2(e) hereof, such Selling Stockholder will immediately
notify the Representative of such change.
(g) Other than excepted activity pursuant to Regulation M under
the Exchange Act, such Selling Stockholder has not taken and will not take,
directly or indirectly, any action that constituted, or any action designed to,
or that might reasonably be expected to cause or result in or constitute, under
the Act or otherwise, stabilization or manipulation of the price of the Common
Stock to facilitate the sale or resale of the Shares.
(h) Upon delivery of and payment for the Shares to be sold by
such Selling Stockholder pursuant to this Agreement, good and valid title to
such Shares will pass to the Underwriters, free of all restrictions on transfer,
liens, encumbrances, security interests, equities and claims whatsoever.
(i) Such Selling Stockholder does not have any registration or
other similar rights to have any equity or debt securities registered for sale
by the Company under the Registration Statement or included in the offering
contemplated by this Agreement[, except for
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such rights as are being exercised in the offering contemplated by this
Agreement or such rights as have been duly waived].
(j) Such Selling Stockholder has no reason to believe that the
representations and warranties of the Company contained in Section 1.1 hereof
are not true and correct, is familiar with the Registration Statement and the
Final Prospectus and has no knowledge of any material fact, condition or
information not disclosed in the Registration Statement or the Final Prospectus
that has had or may have a Material Adverse Effect, and is not prompted to sell
shares of Common Stock by any information concerning the Company that is not set
forth in the Registration Statement.
2. PURCHASE AND SALE.
The Company and each Selling Stockholder hereby agrees to issue and sell
the Firm Shares to the Underwriters and, upon the basis of the representations,
warranties and agreements of the Company and each Selling Stockholder herein
contained and subject to all the terms and conditions set forth herein, each
Underwriter agrees, severally and not jointly, to purchase at a purchase price
of $[______] per Share (the "purchase price per Share"), the number of Firm
Shares set forth opposite the name of such Underwriter in Schedule I hereto.
The Company [Selling Stockholders] [Company and the Selling Stockholders]
hereby also agrees to sell to the Underwriters, and, upon the basis of the
representations, warranties and agreements of the Company [Selling Stockholders]
[Company and the Selling Stockholders] herein contained and subject to all the
terms and conditions set forth herein, the Underwriters shall have the right for
30 days from the date of the Final Prospectus to purchase from the Company
[Selling Stockholders] [Company and the Selling Stockholders] up to [_______]
Additional Shares at the purchase price per Share for the Firm Shares. The
Additional Shares may be purchased solely for the purpose of covering
over-allotments, if any, made in connection with the offering of the Firm
Shares. If any Additional Shares are to be purchased, each Underwriter,
severally and not jointly, agrees to purchase the number of Additional Shares
(subject to such adjustments as you may determine to avoid fractional shares)
that bears the same proportion to the total number of Additional Shares to be
purchased by the Underwriters as the number of Shares set forth opposite the
name of such Underwriter in Schedule I hereto bears to the total number of
Shares. The option to purchase Additional Shares may be exercised at any time
within 30 days after the date of the Final Prospectus, but no more than once,
and shall close on the date indicated by the Representatives (the "Date of
Delivery").
3. DELIVERY AND PAYMENT. (a) Delivery of and payment for the Firm Shares
shall be made at the offices of Xxxxxxxx & Xxxxxxxx LLP, 0000 Xxxxxx xx xxx
Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, or through the facilities of the Depository
Trust Company ("DTC") or a custodian for DTC and registered in the name of Cede
& Co., as nominee for DTC, at 10:00 a.m., New York City time, on such date or
dates as the Representatives shall designate by notice to the company (the time
and date of such closing are called the "Closing Date"). The date and time may
be varied by agreement between the Representatives and the Company. Delivery of
the Firm Shares shall be made to the Representatives for the respective accounts
of the several Underwriters against payment by the several Underwriters through
the Representatives of the purchase price thereof in the manner set forth in
Schedule I hereto.
11
(b) In addition, in the event that any or all of the Additional
Shares are purchased by the Underwriters, delivery and payment for the
Additional Shares shall be made at the offices of Xxxxxxxx & Xxxxxxxx LLP or
through the facilities of DTC or a custodian for DTC and registered in the name
of Cede & Co., as nominee for DTC, at 10:00 a.m., New York City time, on such
date or dates as the Representatives shall designate by notice to the Company
(the time and date of such closing with respect to the Additional Shares are
called the "Additional Closing Date").
(c) Upon delivery, the Shares to be purchased hereunder shall be
registered in such names and in such denominations as the Representatives shall
request in writing not less than two full business days prior to the Closing
Date or the Additional Closing Date, as the case may be. If certificates
representing the Shares are issued, then for the purpose of expediting the
checking and packaging of the certificates for the Shares, the Company shall
make the certificates representing the Shares available for inspection by the
Representatives in New York, New York, not later than 9:30 A.M., New York City
time, on the business day prior to the Closing Date or the Additional Closing
Date, as the case may be.
4. AGREEMENTS.
4.1 OF THE COMPANY. The Company agrees with the several Underwriters
that:
(a) Prior to the termination of the offering of the Shares, the
Company will not file any amendment of the Registration Statement or supplement
(including any Final Prospectus) to the Basic Prospectus unless the Company has
furnished you a copy for your review prior to filing and will not file any such
proposed amendment or supplement to which you reasonably object. Subject to the
foregoing sentence, the Company will cause each Final Prospectus to be filed
with the Commission pursuant to Rule 424 or Rule 434 via XXXXX. The Company will
advise the Representatives promptly (i) when each Final Prospectus shall have
been filed with the Commission pursuant to Rule 424 or Rule 434, (ii) when any
amendment to the Registration Statement relating to the Shares shall have become
effective, (iii) of any request by the Commission for any amendment of the
Registration Statement or amendment of or supplement to the Final Prospectus or
for any additional information, (iv) of the issuance by the Commission of any
stop order suspending the effectiveness of the Registration Statement or the
institution or threatening of any proceeding for that purpose and (v) of the
receipt by the Company of any notification with respect to the suspension of the
qualification of the Shares for sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose. The Company will use its best
efforts to prevent the issuance of any such stop order and, if issued, to obtain
as soon as possible the withdrawal thereof.
(b) If, at any time when a prospectus relating to the Shares is
required to be delivered under the Act, except with respect to any such delivery
requirement imposed upon an affiliate of the Company in connection with any
secondary market sales, any event occurs as a result of which each Final
Prospectus as then amended or supplemented would include any untrue statement of
a material fact or omit to state any material fact necessary to make the
statements therein in light of the circumstances under which they were made not
misleading, or if it shall be necessary to amend or supplement the Final
Prospectus to comply
12
with the Act or the Exchange Act or the respective rules thereunder, the Company
promptly will prepare and file with the Commission, subject to the first
sentence of paragraph (a) of this Section 4.1, an amendment or supplement which
will correct such statement or omission or an amendment which will effect such
compliance.
(c) The Company will make generally available to its security
holders and to the Representatives as soon as practicable, but not later than 60
days after the close of the period covered thereby, an earnings statement (in
form complying with the provisions of Rule 158 of the regulations under the Act)
covering a twelve month period beginning not later than the first day of the
Company's fiscal quarter next following the "effective date" (as defined in said
Rule 158) of the Registration Statement.
(d) The Company will furnish to the Representatives and counsel
for the Underwriters, without charge, copies of the Registration Statement
(including exhibits thereto) and each amendment thereto which shall become
effective on or prior to the Closing Date and, so long as delivery of a
prospectus by an Underwriter or dealer may be required by the Act, as many
copies of any Final Prospectus and any amendments thereof and supplements
thereto as the Representatives may reasonably request. The Company will pay the
expenses of printing all documents relating to the offering.
(e) The Company will arrange for the qualification of the Shares
for sale under the laws of such jurisdictions as the Representatives may
reasonably designate, will maintain such qualifications in effect so long as
required for the distribution of the Shares and will arrange for the
determination of the legality of the Shares for purchase by institutional
investors; provided, however, that the Company shall not be required to qualify
to do business in any jurisdiction where it is not now so qualified or to take
any action which would subject it to general or unlimited service of process of
any jurisdiction where it is not now so subject.
(f) Until the _____ day following the Closing Date, the Company
will not, without the consent of the Representatives, offer or sell, or announce
the offering of, any securities covered by the Registration Statement or by any
other registration statement filed under the Act; provided, however, the Company
may, at any time (i) offer or sell or announce the offering of any securities
(A) covered by a registration statement on Form S-8 or (B) covered by a
registration statement on Form S-2 or S-4 in an acquisition transaction or (ii)
register for resale shares of Common Stock acquired by holders in connection
with the Redemption.
4.2 OF EACH SELLING STOCKHOLDER. Each Selling Stockholder agrees with
the several Underwriters as follows:
(a) On the Closing Date, all stock transfer and other taxes
(other than income taxes) that are required to be paid in connection with the
sale and transfer of the Firm Shares to be sold by such Selling Stockholder to
the Underwriters hereunder will have been fully paid for by such Selling
Stockholder and all laws imposing such taxes will have been fully complied with.
13
(b) In order to document the Underwriters' compliance with the
reporting and withholding provisions of the Internal Revenue Code of 1986, as
amended (the "Code"), and the regulations promulgated thereunder, with respect
to the transactions herein contemplated, such Selling Stockholder shall deliver
to you at least two days prior to the Closing Date a properly completed and
executed United States Treasury Department Substitute Form W-9.]
5. CONDITIONS TO THE OBLIGATIONS OF THE UNDERWRITERS. The obligations of
the Underwriters to purchase the Shares shall be subject to the accuracy of the
representations and warranties on the part of the Company contained herein as of
the date hereof, as of the date of the effectiveness of any amendment to the
Registration Statement filed prior to the Closing Date and as of the Closing
Date, to the accuracy of the statements of the Company and the Selling
Stockholders made in any certificates pursuant to the provisions hereof, to the
performance by the Company and the Selling Stockholders of its obligations
hereunder and to the following additional conditions:
(a) No stop order suspending the effectiveness of the
Registration Statement, as amended from time to time, shall have been issued and
no proceedings for that purpose shall have been instituted or threatened; and
any Final Prospectus shall have been filed or mailed for filing with the
Commission within the time period prescribed by the Commission.
(b) The Company shall have furnished to the Representatives the
opinion of Xxxxxxxx & Xxxxxxxx LLP, counsel for the Company, dated the Closing
Date, to the effect of paragraphs (i) through (x) below:
(i) the Company is a duly organized and validly existing
corporation in good standing under the laws of the State of Delaware and has the
corporate power and authority to own its properties and conduct its business as
described in the Final Prospectus;
(ii) the Company is qualified or licensed to do business as
a foreign corporation in any jurisdiction in which such counsel has knowledge
that the Company is required to be so qualified or licensed;
(iii) the Shares have been duly and validly authorized and
issued and are fully paid and nonassessable;
(iv) the Shares conform in all material respects to the
description thereof contained in the Final Prospectus;
(v) such counsel is without knowledge that (1) there is any
pending or threatened action, suit or proceeding before or by any court or
governmental agency, authority or body or any arbitrator involving the Company
or any of its subsidiaries, of a character required to be disclosed in the
Registration Statement which is not disclosed in the Final Prospectus, or (2)
any franchise, contract or other document of a character required to be
described in the Registration Statement or Final Prospectus, or to be filed as
an exhibit to the Registration Statement, is not so described or filed as
required;
14
(vi) the Registration Statement has become effective under
the Act; such counsel is without knowledge that any stop order suspending the
effectiveness of the Registration Statement has been issued or any proceedings
for that purpose have been instituted or threatened; and the Registration
Statement, the Final Prospectus and each amendment thereof or supplement thereto
(other than the financial statements and other financial and statistical
information contained therein or incorporated by reference therein, as to which
such counsel need express no opinion) comply as to form in all material respects
with the applicable requirements of the Act and the Exchange Act and the
respective rules thereunder;
(vii) this Agreement has been duly authorized, executed and
delivered by the Company and constitutes a legal, valid and binding agreement of
the Company enforceable against the Company in accordance with its terms
(subject, as to enforcement of remedies, to applicable bankruptcy,
reorganization, insolvency, moratorium, fraudulent conveyance or other similar
laws affecting the rights of creditors now or hereafter in effect, and to
equitable principles that may limit the right to specific enforcement of
remedies, and except insofar as the enforceability of the indemnity and
contribution provisions contained in this Agreement may be limited by federal
and state securities laws);
(viii) no consent, approval, authorization or order of any
court or governmental agency or body is required on behalf of the Company for
the consummation of the transactions contemplated herein, except such as have
been obtained under the Act and such as may be required under the blue sky or
insurance laws of any jurisdiction in connection with the purchase and
distribution of the Shares by the Underwriters and such other approvals
(specified in such opinion) as have been obtained;
(ix) neither the issue and sale of the Shares, nor the
consummation of any other of the transactions herein contemplated nor the
fulfillment of the terms hereof will conflict with, result in a breach of, or
constitute a default under the certificate of incorporation or by-laws of the
Company (1) the terms of any material indenture or other agreement or instrument
known to such counsel and to which the Company or the Subsidiaries is a party or
bound, or (2) any order or regulation known to such counsel to be applicable to
the Company and the Subsidiaries of any court, regulatory body, administrative
agency, governmental body or arbitrator having jurisdiction over the Company or
the Subsidiaries; and
(x) such counsel is without knowledge of rights to the
registration of securities of the Company under the Registration Statement which
have not been waived by the holders of such rights or which have not expired by
reason of lapse of time following notification of the Company's intention to
file the Registration Statement, except for the registration rights of holders
of Common Stock acquired in connection with the Redemption.
15
In rendering such opinion, but without opining in connection therewith,
such counsel shall also state that, although it has not independently verified,
is not passing upon and assumes no responsibility for the accuracy, completeness
or fairness of the statements contained in the Registration Statement, it has no
reason to believe that the Registration Statement or any amendment thereof at
the time it became effective contained any untrue statement of a material fact
or omitted 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 Final Prospectus, as amended or
supplemented, contains any untrue statement of a material fact or omits to state
a material fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.
In rendering such opinion, such counsel may rely (A) as to matters
involving the application of laws of any jurisdiction other than the State of
New York or the United States, or the General Corporate Law of Delaware to the
extent deemed proper and specified in such opinion, upon the opinion of other
counsel of good standing believed to be reliable and who are satisfactory to
counsel for the Underwriters; and (B) as to matters of fact, to the extent
deemed proper, on certificates of responsible officers of the Company and its
subsidiaries and public officials.
(c) The Representatives shall have received from
____________________, counsel for the Underwriters, such opinion or opinions,
dated the Closing Date, with respect to the issuance and sale of the Firm
Shares, the Registration Statement, the Final Prospectus and other related
matters as the Representatives may reasonably require, 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.
(d) The Company shall have furnished to the Representatives a
certificate of the Company, signed by the President and Chief Executive Officer
and the principal financial or accounting officer of the Company, dated the
Closing Date, to the effect that the signers of such certificate have carefully
examined the Registration Statement, the Final Prospectus and this Agreement and
that to the best of their knowledge:
(i) the representations and warranties of the Company in
this Agreement are true and correct in all material respects on and as of the
Closing Date with the same effect as if made on the Closing Date and the Company
has complied with all the agreements and satisfied all the conditions on its
part to be performed or satisfied at or prior to the Closing Date;
(ii) no stop order suspending the effectiveness of the
Registration Statement, as amended, has been issued and no proceedings for that
purpose have been instituted or threatened; and
(iii) since the date of the most recent financial statements
included in the Final Prospectus, there has been no material adverse change in
the condition (financial or other), earnings, business or properties of the
Company and its Subsidiaries, whether or not arising from transactions in the
ordinary course of business, except as set forth in or contemplated in the Final
Prospectus.
16
(e) At the Closing Date, KPMG LLP shall have furnished to the
Representatives a letter or letters (which may refer to letters previously
delivered to one or more of the Representatives), dated as of the Closing Date,
in form and substance satisfactory to the Representatives, stating in effect
that:
(i) They are independent accountants within the meaning of
the Act and the Exchange Act and the respective applicable published rules and
regulations thereunder.
(ii) In their opinion, the consolidated financial statements
of the Company and its subsidiaries audited by them and included or incorporated
by reference in the Registration Statement and Final Prospectus comply as to
form in all material respects with the applicable accounting requirements of the
Act and the regulations thereunder with respect to registration statements on
Form S-2 and the Exchange Act and the regulations thereunder.
(iii) On the basis of procedures (but not an audit in
accordance with generally accepted auditing standards) consisting of:
(a) Reading the minutes of the meetings of the stockholders,
the board of directors, executive committee, compensation committee and audit
committee of the Company and the boards of directors and executive committees of
its subsidiaries as set forth in the minute books through a specified date not
more than five business days prior to the date of delivery of such letter;
(b) Performing the procedures specified by the American
Institute of Certified Public Accountants for a review of interim financial
information as described in Statement of Accounting Standards No. 100 and No.
71, Interim Financial Information, on the unaudited condensed consolidated
interim financial statements of the Company and its consolidated subsidiaries
included or incorporated by reference in the Registration Statement and Final
Prospectus and reading the unaudited interim financial data, if any, for the
period from the date of the latest balance sheet included or incorporated by
reference in the Registration Statement and Final Prospectus to the date of the
latest available interim financial data; and
(c) Making inquiries of certain officials of the Company who
have responsibility for financial and accounting matters regarding the specific
items for which representations are requested below, nothing has come to their
attention as a result of the foregoing procedures that caused them to believe
that:
(1) the unaudited interim financial statements,
included or incorporated by reference in the Registration Statement and Final
Prospectus, do not comply as to form in all material respects with the
applicable accounting requirements of the Exchange Act and the published rules
and regulations thereunder;
(2) any material modifications should be made to the
unaudited interim financial statements, included or incorporated by reference in
the Registration Statement and Final Prospectus, for them to be in conformity
with generally accepted accounting principles;
17
(3) (i) at the date of the latest available interim
financial data and at the specified date not more than five business days prior
to the date of the delivery of such letter, there was any change in the capital
stock or the long-term debt (other than scheduled repayments of such debt) or
any decreases in shareholders' equity of the Company and the Subsidiaries on a
consolidated basis as compared with the amounts shown in the latest balance
sheet included or incorporated by reference in the Registration Statement and
the Final Prospectus or (ii) for the period from the date of the latest
available financial data to a specified date not more than five business days
prior to the delivery of such letter, there was any change in the capital stock
or the long-term debt (other than scheduled repayments of such debt) or any
decreases in shareholders' equity of the Company and the Subsidiaries on a
consolidated basis, except in all instances for changes or decreases which the
Registration Statement and Final Prospectus discloses have occurred or may
occur, or KPMG LLP shall state any specific changes or decreases.
(iv) The letter shall also state that KPMG LLP has carried
out certain other specified procedures, not constituting an audit, with respect
to certain amounts, percentages and financial information which are included or
incorporated by reference in the Registration Statement and Final Prospectus and
which are specified by the Representatives and agreed to by KPMG LLP, and has
found such amounts, percentages and financial information to be in agreement
with the relevant accounting, financial and other records of the Company and its
Subsidiaries identified in such letter.
In addition, at the time this Agreement is executed, KPMG LLP shall have
furnished to the Representatives a letter or letters, dated the date of this
Agreement, in form and substance satisfactory to the Representatives, to the
effect set forth in this paragraph (e) and in Schedule I hereto.
(f) Subsequent to the respective dates as of which information is
given in the Registration Statement and the Final Prospectus, there shall not
have been (i) any change or decrease specified in the letter or letters referred
to in paragraph (e) of this Section 5 or (ii) any change, or any development
involving a prospective change, in or affecting the earnings, business or
properties of the Company and its subsidiaries the effect of which, in any case
referred to in clause (i) or (ii) above, is, in the judgment of the
Representatives, so material and adverse as to make it impractical or
inadvisable to proceed with the offering or the delivery of the Shares as
contemplated by the Registration Statement and the Final Prospectus.
(g) You shall be satisfied that, and you shall have received a
certificate dated the Closing Date, from each Selling Stockholder to the effect
that, as of the Closing Date, as the case may be: (i) the representations and
warranties made by such Selling Stockholders herein are true and correct in all
material respects on the Closing Date and (ii) such Selling Stockholder has
complied with all obligations and satisfied all conditions that are required to
be performed or satisfied on his or its part at or prior to the Closing Date.
(h) At or prior to the Closing Date, you shall have received the
written commitment, in the form agreed to with the Representatives, from each of
the Company's senior executive officers and directors not to directly or
indirectly sell, offer or contract to sell or otherwise dispose of or transfer
any shares of Common Stock, whether now owned or acquired
18
after the date of this Agreement, or file any registration statement under the
Act with respect to the foregoing, other than as provided in such written
commitment before the expiration of ___ days from the Closing Date, without the
prior written consent of _______________.
(i) The Underwriters shall have received on the Closing Date an
opinion of counsel that shall relate to each of the Selling Stockholders, dated
the Closing Date, to the effect that:
(i) this Agreement has been duly executed and delivered by
or on behalf of such Selling Stockholder, and is a valid and binding agreement
of such Selling Stockholder; and
(ii) delivery of stock certificates representing the Shares
to be sold by such Selling Stockholder, endorsed to the Underwriters and payment
therefor pursuant to this Agreement will pass valid title to such Shares, free
and clear of any adverse claim within the meaning of Section 8-102 of the New
York Uniform Commercial Code, to each Underwriter who has purchased such Shares
without notice of an adverse claim.
(j) Prior to the Closing Date, the Company and the Selling
Stockholders shall have furnished to the Representatives such further
information, certificates and documents as the Representatives may reasonably
request.
If any of the conditions specified in this Section 5 shall not have been
fulfilled in all material respects when and as provided in this Agreement, or if
any of the opinions and certificates mentioned above or elsewhere in this
Agreement shall not be in all material respects reasonably satisfactory in form
and substance to the Representatives and their counsel, this Agreement and all
obligations of the Underwriters hereunder may be canceled at, or at any time
prior to, the Closing Date by the Representatives. Notice of such cancellation
shall be given to the Company in writing or by telephone or telegraph confirmed
in writing.
6. PAYMENT OF EXPENSES. The Company will pay all expenses incident to the
performance of its obligations under this Agreement, including (i) the printing
and filing of the Registration Statement as originally filed and of each
amendment thereto, (ii) the copying of this Agreement, (iii) the preparation,
issuance and delivery of the certificates for the Shares to the Underwriters,
including capital duties, stamp duties and stock transfer taxes, if any, payable
upon issuance of any of the Shares, the sale of the Shares to the Underwriters
and the fees and
19
expenses of the transfer agent for the Shares, (iv) the fees and disbursements
of the Company's counsel and accountants, (v) the qualification of the Shares
under state securities laws in accordance with the provisions of Section 4.1(e),
including filing fees and the reasonable fees and disbursements of counsel for
the Underwriters in connection therewith and in connection with the preparation
of the Blue Sky Survey, (vi) the printing and delivery to the Underwriters of
copies of the Registration Statement as originally filed and of each amendment
thereto and of any Final Prospectus and any amendments or supplements thereto,
(vii) the printing and delivery to the Underwriters of copies of the Blue Sky
Survey, and (viii) the fee of the National Association of Securities Dealers,
Inc. and, if applicable, the AMEX. Each Selling Stockholder shall be liable for
its own expenses in connection with the offering contemplated hereby.
If the sale of the Shares provided for herein is not consummated because
any condition to the obligations of the Underwriters set forth in Section 5
hereof is not satisfied or because of any refusal, inability or failure on the
part of the Company to perform any agreement herein or comply with any provision
hereof other than by reason of a default by any of the Underwriters, the Company
will reimburse the Underwriters severally upon demand for all out-of-pocket
expenses (including reasonable fees and disbursements of counsel) that shall
have been incurred by them in connection with the proposed purchase and sale of
the Shares.
7. CONDITIONS TO PURCHASE OF ADDITIONAL SHARES. In the event the
Underwriters exercise the option granted in Section 2 hereof to purchase all or
any portion of the Additional Shares and the Date of Delivery determined by the
Representatives pursuant to Section 2 is later than the Closing Date, the
obligations of the several Underwriters to purchase and pay for the Additional
Shares that they shall have respectively agreed to purchase hereunder are
subject to the accuracy of the representations and warranties of the Company and
the Selling Stockholders contained herein, to the performance by the Company and
the Selling Stockholders of their respective obligations hereunder and to the
following additional conditions:
(a) No stop order suspending the effectiveness of the
Registration Statement, as amended from time to time, shall have been issued and
no proceedings for that purpose shall have been instituted or threatened; and
any required filing of the Final Prospectus pursuant to Rule 424(b) or Rule 434
under the Act shall have been made within the proper time period.
(b) At the Date of Delivery, the Representatives shall have
received, each dated the Date of Delivery and relating to the Additional Shares:
(i) the favorable opinion of Xxxxxxxx & Xxxxxxxx LLP,
counsel for the Company, in form and substance satisfactory to counsel for the
Underwriters, to the same effect as the opinion required by Section 5(b);
(ii) the favorable opinion of ____________________, counsel
for the Underwriters, to the same effect as the opinion required by Section
5(c);
(iii) a certificate, of President and Chief Executive
Officer of the Company and of the principal financial or accounting officer of
the Company with respect to the matters set forth in Section 5(d);
20
(iv) a letter from KPMG LLP, in form and substance
satisfactory to the Underwriters, substantially the same in scope and substance
as the letter furnished to the Underwriters pursuant to Section 5(e) except that
the "specified date" in the letter furnished pursuant to this Section 7(b)(iv)
shall be a date not more than five days prior to the Date of Delivery;
(v) Subsequent to the respective dates as of which
information is given in the Registration Statement and the Final Prospectus,
there shall not have been (i) any change or decrease specified in the letter or
letters referred to in paragraph (b)(i)(v) of this Section 7 or (ii) any change,
or any development involving a prospective change, in or affecting the earnings,
business or properties of the Company and its subsidiaries the effect of which,
in any case referred to in clause (i) or (ii) above, is, in the judgment of the
Representatives, so material and adverse as to make it impractical or
inadvisable to proceed with the offering or the delivery of the Shares as
contemplated by the Registration Statement and the Final Prospectus; and
(vi) such other information, certificates and documents as
the Representatives may reasonably request.
If any of the conditions specified in this Section 7 shall not have been
fulfilled in all material respects when and as provided in this Agreement, or if
any of the opinions and certificates mentioned above or elsewhere in this
Agreement shall not be in all material respects reasonably satisfactory in form
and substance to the Representatives and their counsel, this Agreement and all
obligations of the Underwriters hereunder may be canceled at, or at any time
prior to, the Date of Delivery by the Representatives. Notice of such
cancellation shall be given to the Company in writing or by telephone or
facsimile confirmed in writing.
8. INDEMNIFICATION AND CONTRIBUTION. (a) The Company agrees to indemnify
and hold harmless each Underwriter and each person who controls any Underwriter
within the meaning of either the Act or the Exchange Act against any and all
losses, claims, damages or liabilities, joint or several, to which they or any
of them may become subject under the Act, the Exchange Act or other Federal or
state statutory law or regulation, at common law or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement as originally filed or in
any amendment thereof, or arise out of or are based upon any omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, or arise out of or are
based upon any untrue statement or alleged untrue statement of a material fact
contained in the Final Prospectus, or any amendment or supplement thereof, or
arise out of or are based upon any omission or alleged omission to state therein
a 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, and agrees to reimburse each such indemnified party for any
legal or other expenses reasonably incurred by them in connection with
investigating or defending any such loss, claim, damage, liability or action;
provided, however, that (i) the Company will not be liable in any such case to
the extent that any such loss, claim, damage or liability arises out of or is
based upon any such untrue statement or alleged untrue statement or omission or
alleged omission made therein in reliance upon and in conformity with written
information furnished to
21
the Company by or on behalf of any Underwriter through the Representatives
specifically for use in connection with the preparation thereof and (ii) such
indemnity with respect to the Basic Prospectus or any Final Prospectus shall not
inure to the benefit of any Underwriter (or any person controlling such
Underwriter) from whom the person asserting any such loss, claim, damage or
liability purchased the Shares which are the subject thereof if such person did
not receive a copy of the Final Prospectus (or the Final Prospectus as amended
or supplemented) excluding documents incorporated therein by reference at or
prior to the confirmation of the sale of such Shares to such person in any case
where such delivery is required by the Act and the untrue statement or omission
of a material fact contained in the Basic Prospectus was corrected in any Final
Prospectus (or any Final Prospectus as amended or supplemented). This indemnity
agreement will be in addition to any liability which the Company may otherwise
have.
(b) Each Selling Stockholder agrees to indemnify and hold
harmless each Underwriter and each person who controls any Underwriter within
the meaning of either the Act or the Exchange Act against any and all losses,
claims, damages or liabilities, joint or several, to which they or any of them
may become subject under the Act, the Exchange Act or other Federal or state
statutory law or regulation, at common law or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise out of or
are based upon any untrue statement or alleged untrue statement of a material
fact contained in the Registration Statement as originally filed or in any
amendment thereof, or arise out of or are based upon any omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, or arise out of or are
based upon any untrue statement or alleged untrue statement of a material fact
contained in the Final Prospectus, or any amendment or supplement thereof, or
arise out of or are based upon any omission or alleged omission to state therein
a 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, in each case, solely to the extent that such statements or
omissions were made or omitted in reliance upon and in conformity with the
information provided in writing by such Selling Stockholder for use in the
Prospectus, and agrees to reimburse each such indemnified party for any legal or
other expenses reasonably incurred by them in connection with investigating or
defending any such loss, claim, damage, liability or action; subject to the
limitations of Section 8(i) and 8(ii) above. This indemnity agreement will be in
addition to any liability which such Selling Stockholder may otherwise have.
(c) Each Underwriter severally agrees to indemnify and hold
harmless the Company, each of its directors, each of its officers who signs the
Registration Statement, each person who controls the Company within the meaning
of either the Act or the Exchange Act and each Selling Stockholder, to the same
extent as the foregoing indemnity from the Company to each Underwriter, but only
with reference to written information relating to such Underwriter furnished to
the Company by or on behalf of such Underwriter through the Representatives
specifically for use in the preparation of the documents referred to in the
foregoing indemnity. This indemnity agreement will be in addition to any
liability which any Underwriter may otherwise have. The Company and each Selling
Stockholder acknowledges that the statements set forth in the language on the
cover page required by Item 509 of Regulation S-K and under the heading
"Underwriting" or "Plan of Distribution" in any Final Prospectus constitute the
only information furnished in writing by or on behalf of the several
Underwriters for inclusion in the
22
documents referred to in the foregoing indemnity, and you, as the
Representatives, confirm that such statements are correct.
(d) Promptly after receipt by an indemnified party under this
Section 8 of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against the indemnifying party
under this Section 8, notify the indemnifying party in writing of the
commencement thereof, but the omission so to notify the indemnifying party will
not relieve it from any liability which it may have to any indemnified party
otherwise than under this Section 8. In case any such action is brought against
any indemnified party, and it notifies the indemnifying party of the
commencement thereof, the indemnifying party will be entitled to participate
therein, and, to the extent that it may elect by written notice delivered to the
indemnified party promptly after receiving the aforesaid notice from such
indemnified party, to assume the defense thereof, with counsel satisfactory to
such indemnified 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 legal
defenses available to it and/or other indemnified parties which are different
from or additional to those available to the indemnifying party, the indemnified
party or parties shall have the right to select separate counsel to assert such
legal defenses and to otherwise participate in the defense of such action on
behalf of such indemnified party or parties. Upon receipt of notice from the
indemnifying party to such indemnified party of its election so to assume the
defense of such action and approval by the indemnified party of counsel, the
indemnifying party will not be liable to such indemnified party under this
Section 8 for any legal or other expenses subsequently incurred by such
indemnified party in connection with the defense thereof unless (i) the
indemnified party shall have employed separate counsel in connection with the
assertion of legal defenses in accordance with the proviso to the next preceding
sentence (it being understood, however, that the indemnifying party shall not be
liable for the expenses of more than one separate counsel, approved by the
Representatives in the case of subparagraph (a), representing the indemnified
parties under subparagraph (a) who are parties to such action), (ii) the
indemnifying party shall not have employed counsel satisfactory to the
indemnified party to represent the indemnified party within a reasonable time
after notice of commencement of the action or (iii) the indemnifying party has
authorized the employment of counsel for the indemnified party at the expense of
the indemnifying party; and except that if clause (i) or (iii) is applicable,
such liability shall be only in respect of the counsel referred to in such
clause (i) or (iii).
(e) To provide for just and equitable contribution in
circumstances in which the indemnification provided for in paragraph (a) of this
Section 8 is due in accordance with its terms but is for any reason held by a
court to be unavailable on the grounds of policy or otherwise, the Company and
the Selling Stockholders, on the one hand, and the Underwriters shall contribute
to the aggregate losses, claims, damages and liabilities (including legal or
other expenses reasonably incurred in connection with investigating or defending
same) to which the parties may be subject in such proportion so that the
Underwriters are responsible for that portion represented by the percentage that
the underwriting discount bears to the sum of such discount and the purchase
price of the Shares specified in Schedule I hereto and the Company and the
Selling Stockholders are responsible for the balance; provided, however, that
(x) in no case shall any Underwriter (except as may be provided in any agreement
among underwriters relating to the offering of the Shares) be responsible for
any amount in excess of the underwriting discount
23
applicable to the Shares purchased by such Underwriter hereunder, (y) no Selling
Stockholder shall be liable for an amount greater than its net proceeds from the
sale of Shares contemplated hereby, and (z) 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. For purposes of this Section 8, each person who controls an
Underwriter within the meaning of the Act shall have the same rights to
contribution as such Underwriter, and each person who controls the Company
within the meaning of either the Act or the Exchange Act, each officer of the
Company who shall have signed the Registration Statement and each director of
the Company or a Selling Stockholder shall have the same rights to contribution
as the Company or a Selling Stockholder, as applicable, subject in each case to
clause (y) of this paragraph (d). Any party entitled to contribution will,
promptly after receipt of notice of commencement of any action, suit or
proceeding against such party in respect of which a claim for contribution may
be made against another party or parties under this paragraph (d), notify such
party or parties from whom contribution may be sought, but the omission to so
notify such party or parties shall not relieve the party or parties from whom
contribution may be sought from any other obligation it or they may have
hereunder or otherwise than under this paragraph (d).
9. DEFAULT BY AN UNDERWRITER. If any one or more Underwriters shall fail to
purchase and pay for any of the Shares agreed to be purchased by such
Underwriter or Underwriters hereunder and such failure to purchase shall
constitute a default in the performance of its or their obligations under this
Agreement, the remaining Underwriters shall be obligated severally to take up
and pay for (in the respective proportions which the amount of Shares set forth
opposite their names in Schedule II hereto bear to the aggregate amount of
Shares set forth opposite the names of all the remaining Underwriters) the
Shares which the defaulting Underwriter or Underwriters agreed but failed to
purchase; provided, however, that in the event that the aggregate amount of
Shares which the defaulting Underwriter or Underwriters agreed but failed to
purchase shall exceed 10% of the aggregate amount of Shares set forth in
Schedule II hereto, the remaining Underwriters shall have the right to purchase
all, but shall not be under any obligation to purchase any, of the Shares, and
if such non-defaulting Underwriters do not purchase all of the Shares, this
Agreement will terminate without liability to any non-defaulting Underwriter or
the Company or any Selling Stockholder. In the event of a default by any
Underwriter as set forth in this Section 9, the Closing Date shall be postponed
for such period, not exceeding seven days, as the Representatives shall
determine in order that the required changes in the Registration Statement and
any Final Prospectus or in any other documents or arrangements may be effected.
Nothing contained in this Agreement shall relieve any defaulting Underwriter of
its liability, if any, to the Company, any Selling Stockholder and any
non-defaulting Underwriter for damages occasioned by its default hereunder.
10. FAILURE OF ONE OR MORE OF THE SELLING STOCKHOLDERS TO SELL AND DELIVER
THE SHARES. If one or more of the Selling Stockholders selling at least _____
Shares in the aggregate shall fail to sell and deliver to the Underwriters the
Shares to be sold and delivered by such Selling Stockholders at the Closing Date
pursuant to this Agreement, then the Underwriters may at their option, by
written notice from the Representatives to the Company and the Selling
Stockholders, either (i) terminate this Agreement without any liability on the
part of any Underwriter or, the Company or the Selling Stockholders or (ii)
purchase the Shares that the Company and other Selling Stockholders have agreed
to sell and deliver in accordance with the terms hereof. If one or more of the
Selling
24
Stockholders selling at least _____ Shares in the aggregate shall fail to sell
and deliver to the Underwriters the Shares to be sold and delivered by such
Selling Stockholders pursuant to this Agreement at the Closing Date or
Additional Closing Date, then the Underwriters shall have the right, by written
notice from the Representatives to the Company and the Selling Stockholders, to
postpone the Closing Date or the Additional Closing Date, as the case may be,
but in no event for longer than seven days in order that the required changes,
if any, to the Registration Statement and the Prospectus or any other documents
or arrangements may be effected.
11. TERMINATION. This Agreement shall be subject to termination in the
absolute discretion of the Representatives, by notice given to the Company prior
to delivery of and payment for the Shares, if prior to such time (i) trading in
securities generally on AMEX shall have been suspended or limited or minimum
prices shall have been established on such exchange or (ii) there shall have
occurred any outbreak or material escalation of hostilities or other calamity or
crisis the effect of which on the financial markets of the United States is such
as to make it, in the judgment of the Representatives, impracticable to market
the Shares.
12. REPRESENTATIONS AND INDEMNITIES TO SURVIVE. The respective agreements,
representations, warranties, indemnities and other statements of the Company or
its officers, the Selling Stockholders and of the Underwriters set forth in or
made pursuant to this Agreement will remain in full force and effect, regardless
of any investigation made by or on behalf of any Underwriter, the Selling
Stockholders or the Company or any of the officers, directors or controlling
persons referred to in Section 8 hereof, and will survive delivery of and
payment for the Shares. The provisions of Section 6 and 8 hereof and this
Section 12 shall survive the termination or cancellation of this Agreement.
13. NOTICES. All communications hereunder will be in writing and effective
only on receipt, and, if sent to the Representatives, will be mailed, delivered
or telegraphed and confirmed to them, at the address specified in Schedule I
hereto, with a copy to: [ ]; or, if sent to the Company, will be mailed,
delivered or telegraphed and confirmed to it at Delta Financial Corporation,
0000 Xxxxxxxx Xxxx, Xxxxx 000, Xxxxxxxx, Xxx Xxxx 00000-0000, Attn: Xxxx X.
Xxxxxx, General Counsel, with a copy to: Xxxxxxxx & Xxxxxxxx LLP, 0000 Xxxxxx xx
xxx Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attn: Xxxxx X. Xxxxxxxxx. If to a
Selling Stockholder, to the address set forth on Schedule III hereto.
14. SUCCESSORS. This Agreement will inure to the benefit of and be binding
upon the parties hereto and their respective successors and the officers and
directors and controlling persons referred to in Section 8 hereof, and no other
person will have any right or obligation hereunder.
15. APPLICABLE LAW. This Agreement will be governed by and construed in
accordance with the internal laws of the State of New York, without giving
effect to principles of conflict of laws.
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If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicate hereof, whereupon
this letter and your acceptance shall represent a binding agreement among the
Company, the several Underwriters and the Selling Stockholders.
Very truly yours,
DELTA FINANCIAL CORPORATION
By:
-----------------------------------
Name:
Title:
The foregoing Agreement is hereby
confirmed and accepted as of the
date specified in Schedule I hereto.
By: [Name of Representatives]
By:
---------------------------------------
Name:
Title:
For themselves and the other several
Underwriters, if any, named
in Schedule II to the foregoing
Agreement.
THE SELLING STOCKHOLDERS NAMED IN SCHEDULE II
By:
----------------------------------------
Name:
As Attorney-in-Fact
26
SCHEDULE I
Underwriting Agreement dated __________, _____
Registration Statement No. 333-
Representatives:
Address of Representatives:
Purchase price (include type of funds, if applicable): __________________
in federal (same day) funds or wire transfer to accounts previously designated
to the Representatives by the Company, or if agreed to by the Representatives
and the Company, by certified or official bank check or checks.
Other provisions:
Closing Date, Time and Location: ____________________
Additional items to be covered by the letter from KPMG LLP delivered pursuant to
Section 5(e) at the time this Agreement is executed: ________________________
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SCHEDULE II
Underwriters: Principal Amount of Firm Shares to be Purchased:
28
SCHEDULE III
SELLING STOCKHOLDERS
29
SCHEDULE IV
Subsidiaries
Delta Funding Corporation
Fidelity Mortgage Inc.
DFC Financial Corporation
DF Special Holdings Corporation
Continental Property Management Corp.
DFC 1999-A Corp.
DFC Receivables Company, L.L.C.
XXX 0000-X Xxxx.
XXX Xxxxxxxxx xx Xxxxxx Limited
DFC Funding of Canada Limited
DFC Servicing Receivables Corp.
DFC Servicing Receivables Company, L.L.C.
DFC Holding-A Corp.
DFC Funding Corporation
DFC Acceptance Corporation
Renaissance Mortgage Acceptance Corp.
Renaissance NIM Trust 2002-A
Renaissance NIM Trust 2002-B
Renaissance NIM Trust 2002-C
Renaissance NIM Trust 2002-D
30
