Ulta Salon, Cosmetics & Fragrance, Inc. 8,976,112 Shares of Common Stock1 Underwriting Agreement
Exhibit 1.1
Ulta Salon, Cosmetics & Fragrance, Inc.
8,976,112 Shares of Common Stock1
8,976,112 Shares of Common Stock1
Underwriting Agreement
June 10, 2010
Xxxxxxx Xxxxx & Company, L.L.C.
Xxxxx Fargo Securities, LLC
As Representatives of the Several
Underwriters Named in Schedule A
Xxxxx Fargo Securities, LLC
As Representatives of the Several
Underwriters Named in Schedule A
c/o Xxxxxxx Xxxxx & Company, L.L.C.
000 Xxxx Xxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
000 Xxxx Xxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
c/o Wells Fargo Securities, LLC
000 Xxxx Xxxxxx
0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
000 Xxxx Xxxxxx
0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Section 1. Introductory. Ulta Salon, Cosmetics & Fragrance, Inc. (the “Company”), a
Delaware corporation, has an authorized capital stock consisting of 70,000,000 shares, $0.01 par
value, of Preferred Stock, of which no shares will be outstanding as of the First Closing Date
hereinafter defined, and 400,000,000 shares, $0.01 par value, of Common Stock (“Common Stock”), of
which 58,597,261 shares were outstanding as of May 10, 2010, and no other shares of Common Stock
will have been issued as of the First Closing Date hereinafter defined, except for shares of Common
Stock issued upon the exercise of stock options outstanding as of May 10, 2010. Certain
stockholders of the Company (as named in Schedule B, the “Selling Stockholders”) propose to sell in
the aggregate 8,976,112 shares of the Company’s issued and outstanding Common Stock to the several
underwriters named in Schedule A as it may be amended by the Pricing Agreement hereinafter defined
(“Underwriters”), who are acting severally and not jointly. Collectively, such total of 8,976,112
shares of Common Stock proposed to be sold by the Selling Stockholders is hereinafter referred to
as the “Firm Shares.” In addition, certain of the Selling Stockholders propose to grant to the
Underwriters options to purchase up to an aggregate of 1,346,417 additional shares of Common Stock
(“Option Shares”) as provided in Section 5 hereof. The Firm Shares and, to the extent such options
are exercised, the Option Shares, are hereinafter collectively referred to as the “Shares.” The
Common Stock, including the Shares, will have attached thereto rights (the “Rights”) to purchase
shares of Series A Junior Participating Preferred Stock, par value $.01 per share (the “Preferred
Stock”), of the Company. The Rights are to be issued pursuant to a Stockholder Rights Agreement
(the “Rights Agreement”), dated as of October 25, 2007, between the Company and American Stock
Transfer & Trust Company, as Rights Agent.
| 1 | Plus options to acquire up to an aggregate of 1,346,417 additional shares to cover overallotments. |
You have advised the Company and the Selling Stockholders that the Underwriters propose to
make a public offering of their respective portions of the Shares as soon as you deem advisable
after the Pricing Agreement hereinafter defined has been executed and delivered.
Prior to the purchase and public offering of the Shares by the several Underwriters, the
Company, the Selling Stockholders and the Representatives, acting on behalf of the several
Underwriters, shall enter into an agreement substantially in the form of Exhibit A hereto (the
“Pricing Agreement”). The Pricing Agreement may take the form of an exchange of any standard form
of written telecommunication among the Company, the Selling Stockholders and the Representatives
and shall specify such applicable information as is indicated in Exhibit A hereto. The offering of
the Shares will be governed by this Agreement, as supplemented by the Pricing Agreement. From and
after the date of the execution and delivery of the Pricing Agreement, this Agreement shall be
deemed to incorporate the Pricing Agreement.
The Company and the Selling Stockholders hereby confirm their agreement with the Underwriters
as follows:
Section 2. Representations and Warranties of the Company. The Company represents and
warrants to the several Underwriters and the Selling Stockholders that:
(a) An “automatic shelf registration statement” as defined under Rule 405 of the
Securities Act of 1933, as amended, and the rules and regulations of the Commission
thereunder (collectively, the “1933 Act;” unless otherwise indicated all references herein
to specific rules are rules promulgated under the 1933 Act)on Form S-3 (File No.
333-167291), a related base prospectus (the “Base Prospectus”) and a preliminary prospectus
supplement to the Base Prospectus (any such preliminary prospectus supplement, together with
the Base Prospectus, a “preliminary prospectus”) with respect to the Shares and the Rights
have been prepared and filed with the Securities and Exchange Commission (“Commission”) by
the Company in conformity with the requirements of the 1933 Act; and the Company has so
prepared and has filed such amendments thereto, if any, and such amended preliminary
prospectuses as may have been required to the date hereof and will file such additional
amendments thereto and such amended prospectuses as may hereafter be required. The Company
will prepare and file a prospectus pursuant to Rule 424(b) that discloses the information
previously omitted from the preliminary prospectus in reliance upon Rule 430B. To the
extent that the Representatives request in writing, there have been or will promptly be
delivered to you one signed copy of such registration statement and amendments, one copy of
each exhibit filed therewith, and conformed copies of such registration statement and
amendments (but without exhibits) and of the related Base Prospectus and preliminary
prospectus or prospectuses, and final forms of prospectus for each of the Underwriters.
Such registration statement (as amended, if applicable) at the time it became effective
and the prospectus constituting a part thereof (including, in each case, the information, if
any, deemed to be part thereof pursuant to Rule 430B or the Securities Exchange Act of 1934,
as amended, and the rules and regulations of the Commission thereunder (collectively, the
“Exchange Act”)), as from time to time amended or supplemented, are hereinafter referred to
as the “Registration Statement” and the “Prospectus,” respectively, except that if any
revised prospectus shall be provided to the Underwriters by the Company for use in
connection with the offering of the Shares which differs from the Prospectus on file at the
Commission at the time the Registration Statement became effective (whether or not such
revised prospectus is required to be filed by the Company pursuant to Rule 424(b)), the term
“Prospectus” shall refer to such revised prospectus from and after the time it was provided
to the Underwriters for such use. Any registration
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statement (including any amendment or supplement thereto or information which is deemed
part thereof) filed by the Company under Rule 462(b) (“Rule 462(b) Registration Statement”)
shall be deemed to be part of the “Registration Statement” as defined herein, and any
prospectus (including any amendment or supplement thereto or information which is deemed
part thereof) included in such registration statement shall be deemed to be part of the
“Prospectus” as defined herein, as appropriate. Any reference herein to the Registration
Statement, the Base Prospectus, a preliminary prospectus or the Prospectus shall be deemed
to refer to and include the documents incorporated by reference therein pursuant to Item 12
of Form S-3 under the 1933 Act. Any document filed by the Company after the effective date
of the Registration Statement or the date of any prospectus and incorporated by reference
into the Registration Statement shall be deemed to be included in the Registration Statement
or such prospectus as of the date of such filing. Any document filed by the Company under
the Exchange Act prior to the date hereof or during the offering period, when such document
was or is filed with the Commission, conformed or will conform in all material respects to
the requirements of the Exchange Act, and none of such documents contained or will contain,
as of the date such document was or is filed with the Commission, any untrue statement of a
material fact or omitted or will omit to state a material fact required to be stated therein
or necessary to make the statements therein not misleading.
(b) (i) At the time of filing the Registration Statement, (ii) at the time of the most
recent amendment thereto for the purposes of complying with Section 10(a)(3) of the 1933 Act
(whether such amendment was by post-effective amendment, incorporated report filed pursuant
to Section 13 or 15(d) of the Exchange Act or form of prospectus), (iii) at the time the
Company or any person acting on its behalf (within the meaning, for this clause only, of
Rule 163(c) of the 0000 Xxx) made any offer relating to the Shares in reliance on the
exemption of Rule 163 of the 1933 Act, and (iv) as of the date hereof, the Company was and
is a “well known seasoned issuer” as defined in Rule 405 under the 1933 Act. The
Registration Statement is an “automatic shelf registration statement,” as defined in Rule
405 of the 1933 Act, that was filed not more than three years prior to the date hereof; such
Registration Statement automatically became effective on filing; the Company has not
received from the Commission any notice pursuant to Rule 401(g)(2) of the 1933 Act objecting
to use of the automatic shelf registration statement form and the Company has not otherwise
ceased to be eligible to use the automatic shelf registration form.
(c) The Commission has not issued any order preventing or suspending the use of any
preliminary prospectus, and each preliminary prospectus has conformed in all material
respects with the requirements of the 1933 Act and, as of its date, has not included any
untrue statement of a material fact or omitted to state a material fact necessary to make
the statements therein, in light of the circumstances in which they were made, not
misleading; and when the Registration Statement became effective, and at all times
subsequent thereto, up to the First Closing Date or the Second Closing Date hereinafter
defined, as the case may be, the Registration Statement, including the information deemed to
be part of the Registration Statement at the time specified in Rule 430B, if applicable, and
the Prospectus and any amendments or supplements thereto, in all material respects conformed
or will in all material respects conform to the requirements of the 1933 Act, and neither
the Registration Statement nor the Prospectus, nor any amendment or supplement thereto,
included or will include any untrue statement of a material fact or omitted or will omit to
state a material fact, in the case of the Registration Statement or any amendment or
supplement thereto, required to be stated therein or necessary to make the statements
therein not misleading and, in the case of the Prospectus, or any amendment or supplement
thereto, necessary to make the statements therein, in light of the circumstances under which
they were made, not misleading.
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As of the Applicable Time hereinafter defined, neither (x) the Issuer General Use Free
Writing Prospectus(es) hereinafter defined issued at or prior to the Applicable Time, the
Statutory Prospectus hereinafter defined as of the Applicable Time and the information in
Schedule A to the Pricing Agreement, all being considered together (collectively, the
“Disclosure Package”), nor (y) any individual Issuer Limited Use Free Writing Prospectus
(hereinafter defined) issued at or prior to the Applicable Time, when considered together
with the Disclosure Package, included any untrue statement of a material fact or omitted to
state a material fact necessary to make the statements therein not misleading.
As used in this Section 2(c) and elsewhere in this Agreement:
“Applicable Time” means 6:00 p.m., Chicago Time, on June 10, 2010 or such other time as
agreed by the Company, the Selling Stockholders and the Representatives.
“Issuer Free Writing Prospectus” means any “issuer free writing prospectus,” as defined
in Rule 433, relating to the Shares that (i) is required to be filed with the Commission by
the Company, (ii) is a “road show for an offering that is a written communication” within
the meaning of Rule 433(d)(8)(i) or (iii) is exempt from filing pursuant to Rule
433(d)(5)(i) because it contains a description of the Shares or of the offering thereof that
does not reflect the final terms, in each case in the form filed or required to be filed
with the Commission or, if not required to be filed, in the form required to be retained in
the Company’s records pursuant to Rule 433(g).
“Issuer General Use Free Writing Prospectus” means any Issuer Free Writing Prospectus
specified in Schedule C hereto.
“Issuer Limited Use Free Writing Prospectus” means any Issuer Free Writing Prospectus
that is not an Issuer General Use Free Writing Prospectus.
“Statutory Prospectus” as of any time means the Base Prospectus, as supplemented by the
preliminary prospectus supplement, relating to the Shares that is included in the
Registration Statement immediately prior to that time.
Each Issuer Free Writing Prospectus, as of its issue date and at all subsequent times
through the completion of the public offer and sale of the Shares or until any earlier date
that the Company notified or notifies the Representatives as described in Section 6(d), did
not, does not and will not include any information that conflicted, conflicts or will
conflict with the information contained in the Registration Statement or the Prospectus, and
any preliminary or other prospectus deemed to be a part thereof that has not been superseded
or modified.
Notwithstanding the foregoing, the representations and warranties of the Company set
forth in this Section 2(c) shall not apply to information contained in or omitted from any
preliminary prospectus, the Registration Statement, the Prospectus, any Issuer Free Writing
Prospectus or any amendment or supplement thereto in reliance upon and in conformity with
written information furnished to the Company by or on behalf of any Underwriter through the
Representatives specifically for use in the preparation thereof.
At the earliest time after the filing of the Registration Statement relating to the
Shares that the Company or another offering participant made a bona fide offer (within the
meaning of Rule 164(h)(2)) of the 1933 Act and at the date of this Agreement, the Company
was not and is not an “ineligible issuer” as defined in Rule 405.
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(d) The Company has been duly incorporated and is validly existing as a corporation in
good standing under the laws of the State of Delaware, with corporate power and authority to
own its property and conduct its business as described in the Prospectus, except in any such
case where the failure to have such power and authority would not reasonably be expected to
have a material adverse effect upon the Company; the Company is duly qualified to do
business as a foreign corporation under the corporation law of, and is in good standing as
such in, each jurisdiction in which it owns or leases substantial properties, has an office,
or in which substantial business is conducted and such qualification is required except in
any such case where the failure to so qualify or be in good standing would not reasonably be
expected to have a material adverse effect upon the Company.
(e) The Company does not own any subsidiaries.
(f) The issued and outstanding shares of capital stock of the Company as set forth in
the Prospectus, including the outstanding Shares to be sold by the Selling Stockholders,
have been duly authorized and validly issued, are fully paid and nonassessable, and conform
to the description thereof contained in the Prospectus. The Rights Agreement has been duly
authorized, executed and delivered by the Company and constitutes a valid and legally
binding agreement of the Company enforceable against the Company in accordance with its
terms, except as enforceability may be limited by applicable bankruptcy, insolvency or
similar laws affecting creditors’ rights generally or by equitable principles relating to
enforceability; the Rights have been duly authorized and validly issued, and conform to the
description thereof contained in the Prospectus; and the Preferred Stock has been duly
authorized by the Company and validly reserved for issuance and, upon the exercise of the
Rights in accordance with the terms of the Rights Agreement, will be validly issued, fully
paid and nonassessable, and conform to the description thereof contained in the Prospectus.
(g) This Agreement has been duly authorized, executed and delivered by the Company.
(h) The making and performance by the Company of this Agreement and the Pricing
Agreement have been duly authorized by all necessary corporate action and will not (i)
violate any provision of the Company’s charter or bylaws or (ii) result, except as would not
reasonably be expected to have a material adverse effect on the Company, in a breach or
violation of any of the terms and provisions of, or constitute a default or change of
control under (A) any agreement, franchise, license, indenture, mortgage, deed of trust, or
other instrument to which the Company is a party or by which the Company or its property may
be bound or affected, or (B) any statute, rule, regulation or order applicable to the
Company of any court, regulatory body, administrative agency or other governmental body
having jurisdiction over the Company or any of its properties. No consent, approval,
authorization or other order of any court, regulatory body, administrative agency or other
governmental body is required for the execution and delivery of this Agreement or the
Pricing Agreement or the consummation of the transactions contemplated herein or therein,
except for compliance with the 1933 Act and blue sky laws applicable to the public offering
of the Shares by the several Underwriters and clearance of such offering with the Financial
Industry Regulatory Authority (“FINRA”).
(i) The accountants who have expressed their opinions with respect to certain of the
consolidated financial statements incorporated by reference in the Registration Statement
are an independent registered public accounting firm as required by the 1933 Act and the
Exchange Act, and, to the knowledge of the Company, such accountants are not in violation of
the auditor
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independence requirements of the Xxxxxxxx-Xxxxx Act of 2002, as amended (the
“Xxxxxxxx-Xxxxx Act”).
(j) The consolidated financial statements of the Company incorporated by reference in
the Registration Statement, the Disclosure Package and the Prospectus present fairly in all
material respects the consolidated financial position of the Company as of the respective
dates of such financial statements, and the consolidated statements of income and cash flows
of the Company for the respective periods covered thereby, all in conformity with U.S.
generally accepted accounting principles consistently applied throughout the periods
involved, except as disclosed therein.
The financial information set forth in the Prospectus under “Summary Consolidated
Financial and Operating Data” presents fairly in all material respects on the basis stated
in the Prospectus, the information set forth therein.
None of the Registration Statement, the Disclosure Package or the Prospectus contains
any “non-GAAP financial measures” (as such term is defined by the Commission’s rules and
regulations).
(k) The Company is not in violation of its charter or bylaws or in default under any
consent decree, or in default with respect to any material provision of any lease, loan
agreement, franchise, license, permit or other contract obligation to which it is a party;
and, to the Company’s knowledge, and, except as may be disclosed in the Prospectus, there
does not exist any state of facts which constitutes an event of default as defined in such
documents or which, with notice or lapse of time or both, would constitute such an event of
default, in each case, except for violations or defaults that neither individually nor in
the aggregate are material to the Company.
(l) There are no material legal, governmental or regulatory agency proceedings pending,
or to the Company’s knowledge, threatened to which the Company is or may be a party or of
which material property owned or leased by the Company or may be the subject that are not
disclosed in the Prospectus, or that would reasonably be expected to materially and
adversely affect the ability of the Company to perform under the Agreement or the Pricing
Agreement or any action taken or to be taken pursuant hereto or thereto.
(m) There are no holders of securities of the Company having rights to registration
thereof or preemptive rights to purchase Common Stock except as disclosed in the Prospectus.
Except for the Selling Stockholders, all holders of registration rights have waived such
rights with respect to the offering being made by the Prospectus.
(n) The Company has good and marketable title to all the properties and assets
reflected as owned in the financial statements hereinabove described (or elsewhere in the
Prospectus), subject to no lien, mortgage, pledge, charge or encumbrance of any kind except
those, if any, reflected in such financial statements (or elsewhere in the Prospectus) or
that are not material to the Company. To the knowledge of the Company, the Company holds
its leased properties that are material to the Company under valid and binding lease
agreements, except as enforceability may be limited by applicable bankruptcy, insolvency or
similar laws affecting creditors’ rights generally or by equitable principles relating to
enforceability.
(o) The Company has not taken and will not take, directly or indirectly, any action
designed to or which has constituted or which would reasonably be expected to cause or
result,
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under the Exchange Act or otherwise, in stabilization or manipulation of the price of
the Shares to facilitate the sale or resale of the Shares.
(p) Subsequent to the respective dates as of which information is given in the
Registration Statement, the Disclosure Package and the Prospectus, and except as
contemplated by the Prospectus, the Company has not incurred any material liabilities or
obligations, direct or contingent, 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 disturbance or dispute or any action, order or decree of any court or
arbitrator or governmental or regulatory authority, or entered into any material
transactions not in the ordinary course of business and there has not been any material
adverse change in the Company’s condition (financial or otherwise) or results of operations
nor any material change in its capital stock, short-term debt or long-term debt.
(q) There is no material document of a character required to be described in the
Registration Statement, the Disclosure Package or the Prospectus or to be filed as an
exhibit to the Registration Statement which is not described or filed as required.
(r) Except as disclosed in the Prospectus, the Company owns and possesses all right,
title and interest in and to, or has duly licensed from third parties, all patents, patent
rights, trade secrets, inventions, know-how, trademarks, trade names, copyrights, service
marks and other proprietary rights (“Trade Rights”), except as would not reasonably be
expected to have a material adverse effect upon the condition (financial or otherwise) of
the Company or results of operations of the Company. The Company has not received any
notice of infringement, misappropriation or conflict from any third party as to such
material Trade Rights which has not been resolved or disposed of and, to the knowledge of
the Company, the Company has not infringed, misappropriated or otherwise conflicted with
material Trade Rights of any third parties, which infringement, misappropriation or conflict
would reasonably be expected to have a material adverse effect upon the condition (financial
or otherwise) or results of operations of the Company.
(s) The conduct of the business of the Company is in compliance in all material
respects with applicable federal, state, local and foreign laws and regulations, except
where the failure to be in compliance would not reasonably be expected to have a material
adverse effect upon the condition (financial or otherwise) or results of operations of the
Company.
(t) The Company possesses certificates, authorizations or permits issued by appropriate
governmental agencies or bodies necessary to conduct the business now operated by it, except
as would not, individually or in the aggregate, reasonably be expected to have a material
adverse effect on the Company, and has not received any notice of proceedings relating to
the revocation or modification of any such certificate, authorization or permit that, if
determined adversely to the Company, would, individually or in the aggregate, reasonably be
expected to have a material adverse effect on the Company.
(u) All offers and sales of the Company’s capital stock made by the Company prior to
the date hereof were either (i) made pursuant to a registration statement filed by the
Company with the Commission under the 1933 Act or (ii) at all relevant times exempt from the
registration requirements of the 1933 Act and, in each case, all such offers and sales
during the twelve months prior to the date hereof were duly registered with or the subject
of an available exemption from the registration requirements of the applicable state and
local securities or blue sky laws.
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(v) The Company has filed all necessary federal, state and local income and franchise
tax returns that were required to be filed prior to the date hereof, after taking into
account all applicable extensions obtained, and has paid all taxes shown as due thereon, and
there is no tax deficiency that has been, or to the knowledge of the Company might be,
asserted against the Company or any of its properties or assets that would reasonably be
expected to have a material adverse effect upon the condition (financial or otherwise) or
results of operations of the Company.
(w) A registration statement pursuant to Section 12(b) of the Exchange Act to register
the Common Stock thereunder has been declared effective by the Commission pursuant to the
Exchange Act, and the Common Stock is duly registered thereunder. The Shares are listed on
the NASDAQ Global Select Market (“NASDAQ”).
(x) The Company has established and maintains disclosure controls and procedures (as
defined in Rules 13a-15 and 15d-15 under the Exchange Act) and such controls and procedures
are effective in ensuring that material information relating to the Company is made known to
the principal executive officer and the principal financial officer. The Company has
utilized such controls and procedures to the extent applicable in preparing and evaluating
the disclosures relating to the Company included in the Registration Statement, the
Disclosure Package and the Prospectus.
(y) The Company maintains a system of internal accounting controls sufficient to
provide reasonable assurance that: (i) transactions are executed in accordance with
management’s general or specific authorizations; (ii) transactions are recorded as necessary
to permit preparation of financial statements in conformity with U.S. 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)
amounts reflected on the Company’s consolidated balance sheet for assets are compared with
existing assets at reasonable intervals and appropriate action is taken with respect to any
differences.
(z) The Company is not and, after giving effect to the offering and sale of the Shares,
will not be, an “investment company” as defined in Section 3(a) of the Investment Company
Act of 1940, as amended (“Investment Company Act”).
(aa) No material transaction has occurred between or among the Company and any of its
officers or directors, stockholders or any affiliate or affiliates of any such officer or
director or stockholder that is required to be described in and is not described in the
Registration Statement and the Prospectus.
(bb) The Company’s board of directors has validly appointed an audit committee whose
composition satisfies the requirements of Rule 5605(c)(2) of the NASDAQ Rules, and the board
of directors or the audit committee has adopted a charter that satisfies the requirements of
Rule 5605(c)(1) of the NASDAQ Rules.
(cc) The Company has insurance (including self insurance) covering its properties,
operations, personnel and business, including business interruption insurance, which
insurance is in amounts and insures against such losses and risks as, to the Company’s
knowledge, are customary within its industry and, to the Company’s knowledge, are adequate
to protect the Company and its business; and the Company has not (i) received notice from
any insurer or agent of such insurer that capital improvements or other expenditures are
required or necessary to be made in order to continue such insurance or (ii) any reason to
believe that it will not be able to
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renew its existing insurance coverage as and when such coverage expires or to obtain
similar coverage at reasonable cost from similar insurers as may be reasonably necessary to
continue its business.
(dd) The Company is in compliance in all material respects with all applicable
provisions of the Xxxxxxxx-Xxxxx Act and all rules and regulations promulgated thereunder,
and is actively taking steps to ensure that it will be in compliance in all material
respects with other provisions of the Xxxxxxxx-Xxxxx Act that will become applicable to the
Company.
(ee) Except as disclosed in the Prospectus, the Company is not involved in any labor
dispute nor, to the knowledge of the Company, is any such dispute threatened. The Company
is not aware of any litigation, pending or threatened in writing, between the Company and
any of its executive officers and, except as disclosed in the Prospectus, the Company has
not received notice from any of its executive officers that such officer does not intend to
remain in the employment of the Company.
(ff) Except as disclosed in the Prospectus or as would not, individually or in the
aggregate, reasonably be expected to have a material adverse effect upon the condition
(financial or otherwise) or results of operations of the Company, (i) the Company (x) is in
compliance with any and all applicable federal, state, local and foreign laws, rules,
regulations, requirements, decisions and orders relating to the protection of human health
and safety, the environment or hazardous or toxic substances or wastes, pollutants or
contaminants (collectively, “Environmental Laws”); (y) has received and is in compliance
with all permits, licenses, certificates or other authorizations or approvals required under
applicable Environmental Laws to conduct its business; and (z) has not received notice of
any actual or potential liability for the investigation or remediation of any disposal or
release of hazardous or toxic substances or wastes, pollutants or contaminants, and
(ii) there are no costs or liabilities associated with Environmental Laws of or relating to
the Company.
(gg) Except in each case as would not, individually or in the aggregate, reasonably
be expected to have a material adverse effect upon the condition (financial or otherwise) or
results of operations of the Company, each employee benefit plan, within the meaning of
Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”),
that is sponsored or maintained by the Company or any of its Controlled Group Members (which
includes each member of the group of entities under common control with the Company as
determined under Section 414(b), (c) or (m) of the Internal Revenue Code of 1986, as amended
(the “Code”)) for their employees or former employees (a “Plan”) has been maintained in
compliance with its terms and the requirements of any applicable statutes, orders, rules and
regulations, including but not limited to ERISA and the Internal Revenue Code of 1986, as
amended (the “Code”); no prohibited transaction, within the meaning of Section 406 of ERISA
or Section 4975 of the Code, has occurred with respect to any Plan excluding transactions
effected pursuant to a statutory or administrative exemption; and each Plan that is subject
to the funding rules of Section 412 of the Code or Section 302 of ERISA, has complied with
the funding obligations of Section 412 and 430 of the Code and Sections 302 and 303 of
ERISA, and the fair market value of the assets of each Plan (excluding for these purposes
accrued but unpaid contributions) exceeds the present value of all benefits accrued under
the Plan determined using the actuarial assumptions used for funding purposes.
(hh) Neither the Company nor, to the knowledge of the Company, any director, officer,
agent, employee or other person associated with or acting on behalf of the Company, has
(i) used any corporate funds for any unlawful contribution, gift, entertainment or other
unlawful
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expense relating to political activity; (ii) made any direct or indirect unlawful
payment to any foreign or domestic government official or employee from corporate funds;
(iii) violated or is in violation of any provision of the Foreign Corrupt Practices Act of
1977; or (iv) made any bribe, unlawful rebate, payoff, influence payment, kickback or other
unlawful payment.
(ii) The operations of the Company are and have been conducted at all times in
compliance with applicable financial recordkeeping and reporting requirements of the
Currency and Foreign Transactions Reporting Act of 1970, as amended, the money laundering
statutes of all jurisdictions, the rules and regulations thereunder and any related or
similar rules, regulations or guidelines, issued, administered or enforced by any
governmental agency (collectively, the “Money Laundering Laws”), and no action, suit or
proceeding by or before any court or governmental agency, authority or body or any
arbitrator involving the Company with respect to the Money Laundering Laws is pending or, to
the knowledge of the Company, threatened.
(jj) None of the Company or, to the knowledge of the Company, any director, officer,
agent, employee or Affiliate of the Company is currently subject to any U.S. sanctions
administered by the Office of Foreign Assets Control of the U.S. Department of the Treasury
(“OFAC”).
(kk) The Company is not a party to any contract, agreement or understanding with any
person (other than this Agreement) that would give rise to a valid claim against the Company
or any Underwriter for a brokerage commission, finder’s fee or like payment in connection
with the offering and sale of the Shares.
(ll) No forward-looking statement (within the meaning of Section 27A of the 1933 Act
and Section 21E of the Exchange Act) contained in the Registration Statement and the
Prospectus has been made or reaffirmed without a reasonable basis or has been disclosed
other than in good faith.
(mm) Nothing has come to the attention of the Company that has caused the Company to
believe that the statistical and market-related data included in the Registration Statement
and the Prospectus is not based on or derived from sources that are reliable and accurate in
all material respects.
Section 3. Representations, Warranties and Covenants of the Selling Stockholders.
(a) Each of the Selling Stockholders, severally and not jointly, represents and
warrants to, and agrees with, the Company and the Underwriters that:
(i) Such Selling Stockholder has, and on the First Closing Date or the Second
Closing Date (hereinafter defined), as the case may be, will have, valid title to,
or a valid “security entitlement” within the meaning of Section 8-501 of the New
York Uniform Commercial Code (the “UCC”) in respect of, the Shares to be sold by
such Selling Stockholder free and clear of all security interests, claims, liens,
equities or other encumbrances, and the legal right and power and all authorization
required by law to enter into this Agreement, the Pricing Agreement, the Custody
Agreement and Power of Attorney (hereinafter defined) and to sell, assign and
deliver the Shares to be sold by such Selling Stockholder or a security entitlement
in respect of such Shares.
(ii) Upon payment for the Shares to be sold by such Selling Stockholder
pursuant to this Agreement, delivery of such Shares, as directed by the
Underwriters, to
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Cede & Co. (“Cede”) or such other nominee as may be designated by The Depository
Trust Company (“DTC”), registration of such Shares in the name of Cede or such other
nominee and the crediting of such Shares on the books of DTC to securities accounts
of the Underwriters (assuming that neither DTC nor any such Underwriter has notice
of any adverse claim (within the meaning of Section 8-105 of the UCC) to such
Shares, (A) DTC shall be a “protected purchaser” of such Shares within the meaning
of Section 8-303 of the UCC, (B) under Section 8-501 of the UCC, the Underwriters
will acquire a valid security entitlement in respect of such Shares, and (C) no
action based on any “adverse claim,” within the meaning of Section 8-102 of the UCC,
to such Shares may be asserted against the Underwriters with respect to such
security entitlement; for purposes of this representation, such Selling Stockholder
may assume that when such payment, delivery and crediting occur, (x) such Shares
will have been registered in the name of Cede or another nominee designated by DTC,
in each case on the Company’s share registry in accordance with its certificate of
incorporation, bylaws and applicable law, (y) DTC will be registered as a “clearing
corporation” within the meaning of Section 8-102 of the UCC and (z) appropriate
entries to the accounts of the several Underwriters on the records of DTC will have
been made pursuant to the UCC.
(iii) The execution, delivery and performance by or on behalf of such
Selling Stockholder of this Agreement, the Pricing Agreement, the Custody Agreement
and Power of Attorney, the sale of the Shares to be sold by such Selling Stockholder
and the consummation by such Selling Stockholder of the transactions herein and
therein contemplated will not (i) conflict with or result in a breach or violation
of any of the terms or provisions of, or constitute a default under, or result in
the creation or imposition of any lien, charge or encumbrance upon such Selling
Stockholder’s Shares pursuant to, any indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument to which such Selling Stockholder is a
party or by which such Selling Stockholder is bound or to which such Selling
Stockholder’s Shares are subject, (ii) result in any violation of the provisions of
the charter or by-laws or similar organizational documents of such Selling
Stockholder, if any, or (iii) result in the violation of any law or statute or any
judgment, order, rule or regulation of any court or arbitrator or governmental or
regulatory agency, in each case, applicable to the Selling Stockholder, except, in
the case of clauses (i) and (iii) above, for any such conflict, breach or violation
that would not, individually or in the aggregate, reasonably be expected to have a
material adverse effect on the ability of such Selling Stockholder to consummate the
transactions hereunder.
(iv) Such Selling Stockholder has not taken and will not take, directly or
indirectly, any action designed to or which might be reasonably expected to cause or
result, under the Exchange Act or otherwise, in stabilization or manipulation of the
price of any security of the Company to facilitate the sale or resale of the Shares.
(v) Such Selling Stockholder has duly executed and delivered a Custody
Agreement and Power of Attorney (“Custody Agreement and Power of Attorney”) among
the Selling Stockholder, American Stock Transfer & Trust Company, as custodian (the
“Custodian”) and, in the case of the GRP Selling Stockholders (as identified in
Schedule B hereto), Xxxxxx Xxxxx, Xxxxx XxXxxxxxxx and Xxxx Xxxxxx, and, in the case
of Xxx Xxxxx, Xxx Xxxxx (each, an “Agent”), naming each such Agent as such Selling
Stockholder’s attorney-in-fact (and, by the execution by such Agent of this
Agreement, such Agent hereby represents and warrants that she or he has been duly
appointed as attorney-in-fact by the applicable Selling Stockholder pursuant to the
Custody Agreement and Power of Attorney) for the purpose of entering into and
carrying out this Agreement
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and the Pricing Agreement, and a copy of the Custody Agreement and Power of
Attorney has been delivered to you.
(vi) Each such Selling Stockholder holding Shares in certificated form further
represents, warrants and agrees that such Selling Stockholder has deposited in
custody, under a Custody Agreement and Power of Attorney with the Custodian,
certificates in negotiable form or share transfer deeds, as applicable, for the
Shares to be sold hereunder by such Selling Stockholder, for the purpose of further
delivery pursuant to this Agreement. Such Selling Stockholder agrees that the
Shares to be sold by such Selling Stockholder on deposit with the Custodian are
subject to the interests of the Company, the Underwriters and the other Selling
Stockholders, that the arrangements made for such custody, and the appointment of
the applicable Agent pursuant to the Custody Agreement and Power of Attorney, are to
that extent irrevocable, and that the obligations of such Selling Stockholder
hereunder and under the Custody Agreement and Power of Attorney shall not be
terminated except as provided in this Agreement, or the Custody Agreement and Power
of Attorney by any act of such Selling Stockholder, by operation of law, whether, in
the case of an individual Selling Stockholder, by the death or incapacity of such
Selling Stockholder or, in the case of a trust or estate, by the death of the
trustee or trustees or the executor or executors or the termination of such trust or
estate, or, in the case of a partnership or corporation, by the dissolution,
winding-up or other event affecting the legal life of such entity, or by the
occurrence of any other event. If any individual Selling Stockholder, trustee or
executor should die or become incapacitated, or any such trust, estate, partnership
or corporation should be terminated, or if any other event should occur before the
delivery of the Shares hereunder, the documents evidencing Shares then on deposit
with the Custodian shall be delivered by the Custodian in accordance with the terms
and conditions of this Agreement as if such death, incapacity, termination or other
event had not occurred, regardless of whether or not the Custodian shall have
received notice thereof. The applicable Agent has been authorized by such Selling
Stockholder to execute and deliver this Agreement and the Pricing Agreement and the
Custodian has been authorized to receive and acknowledge receipt of the proceeds of
sale of the Shares to be sold by such Selling Stockholder against delivery thereof
and otherwise act on behalf of such Selling Stockholder. The Custody Agreement and
Power of Attorney has been duly executed by or on behalf of such Selling
Stockholder, and a copy thereof has been delivered to you.
(vii) To the extent that any statements or omissions made in a preliminary
prospectus are made in reliance upon and in conformity with written information
relating to such Selling Stockholder furnished to the Company by such Selling
Stockholder in writing expressly for use therein, each preliminary prospectus, as of
its date, has not included any untrue statement of a material fact or omitted to
state a material fact necessary to make the statements therein not misleading; and,
to the extent that any statements or omissions made in the Registration Statement or
the Prospectus or any amendment or supplement thereto are made in reliance upon and
in conformity with information relating to such Selling Stockholder furnished to the
Company by such Selling Stockholder in writing expressly for use therein, neither
the Registration Statement nor the Prospectus, nor any amendment or supplement
thereto, as it relates to such Selling Stockholder included or will include any
untrue statement of a material fact or omitted or will omit to state any material
fact required to be stated therein or necessary to make the statements therein not
misleading. The parties hereto agree that the information relating to such Selling
Stockholder set forth under the caption “Selling Stockholders” and the footnotes
thereunder (excluding any percentages or total
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outstanding share numbers of the Company set forth therein) in both the Base
Prospectus and the preliminary prospectus supplement relating to the Shares is the
only information made in reliance upon and in conformity with written information
relating to such Selling Stockholder furnished to the Company by such Selling
Stockholder expressly for use in any preliminary prospectus, the Registration
Statement and Prospectus and any amendment or supplement thereto.
(viii) Such Selling Stockholder is not a party to any contract, agreement or
understanding with any person (other than this Agreement) that would give rise to a
valid claim against the Company or any Underwriter for a brokerage commission,
finder’s fee or like payment in connection with the offering and sale of the Shares.
(ix) Such Selling Stockholder has not distributed and will not distribute any
prospectus or other offering material in connection with the offering and sale of
the Shares by the Underwriters as contemplated herein.
(x) The sale of the Shares by such Selling Stockholder is not prompted by any
material information concerning the Company known to such Selling Stockholder that
is not set forth in any preliminary prospectus, the Registration Statement or the
Prospectus and any amendment or supplement thereto or otherwise known to the
Company.
(xi) On or prior to the date hereof, such Selling Stockholder has executed and
delivered to the Underwriters a “lock-up” agreement letter in a form satisfactory to
the Underwriters.
In order to document the Underwriters’ compliance with the reporting and withholding
provisions of the Internal Revenue Code of 1986, as amended, with respect to the transactions
herein contemplated, each of the Selling Stockholders agrees to deliver to you prior to or on the
First Closing Date, as hereinafter defined, a properly completed and executed United States
Treasury Department Form W-8 or W-9 (or other applicable form of statement specified by Treasury
Department regulations in lieu thereof).
Section 4. Representations and Warranties of the Underwriters. Each of the
Representatives, severally and not jointly, on behalf of the several Underwriters, represent and
warrant to the Company and the Selling Stockholders that the information set forth in paragraphs 3,
11 and 12 under the caption “Underwriting” in the Prospectus was furnished to the Company by and on
behalf of the Underwriters for use in connection with the preparation of the Registration Statement
and is correct and complete in all material respects.
Section 5. Purchase, Sale and Delivery of Shares. On the basis of the
representations, warranties and agreements herein contained, but subject to the terms and
conditions herein set forth, each of the Selling Stockholders, severally and not jointly, agrees to
sell to the Underwriters named in Schedule A hereto, and the Underwriters agree, severally and not
jointly, to purchase from the Selling Stockholders the number of Firm Shares set forth opposite the
name of each Selling Stockholder in Schedule B hereto at the price per share set forth in the
Pricing Agreement. The obligation of each Underwriter to each of the Selling Stockholders shall
be to purchase from such Selling Stockholder that number of full shares which (as nearly as
practicable, as determined by you) bears to the number of Firm Shares set forth opposite the name
of such Selling Stockholder in Schedule B hereto, the same proportion as the number of Firm Shares
set forth opposite the name of such Underwriter in Schedule A hereto bears to the total number of
Firm Shares to be purchased by all Underwriters under this Agreement. The public offering price
and the purchase price shall be set forth in the Pricing Agreement.
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At 9:00 a.m., Chicago Time, on the fourth business day, if permitted under Rule 15c6-1 under
the Exchange Act (or the third business day if required under Rule 15c6-1 under the Exchange Act or
unless postponed in accordance with the provisions of Section 13 of this Agreement) following the
date the Registration Statement became effective (or, if the Company has elected to rely upon Rule
430B, the fourth business day, if permitted under Rule 15c6-1 under the Exchange Act (or the third
business day if required under Rule 15c6-1 under the Exchange Act), after execution of the Pricing
Agreement), or such other time not later than ten business days after such date as shall be agreed
upon by the Representatives and the Company, the Selling Stockholders will deliver to you at the
offices of counsel for the Underwriters or through the book-entry facilities of The Depository
Trust Company for the accounts of the several Underwriters, the Firm Shares to be sold by them,
against payment of the purchase price therefor by delivery of federal or other immediately
available funds, by wire transfer or otherwise, to the accounts designated by such Selling
Stockholders. Such time of delivery and payment is herein referred to as the “First Closing Date.”
Electronic transfer of the Firm Shares to be so delivered will be in such denominations and
registered in such names as you request by notice to the Selling Stockholders prior to 10:00 a.m.,
Chicago Time, on the second business day preceding the First Closing Date, and will be made
available at the Selling Stockholders’ expense for checking and packaging by the Representatives at
10:00 a.m., Chicago Time, on the business day preceding the First Closing Date. Payment for the
Firm Shares so to be delivered shall be made at the time and in the manner described above at the
offices of counsel for the Underwriters.
In addition, on the basis of the representations, warranties and agreements herein contained,
but subject to the terms and conditions herein set forth, certain of the Selling Stockholders
designated on Schedule B hereby grant, severally and not jointly, options to the several
Underwriters to purchase, severally and not jointly, up to an aggregate of 1,346,417 Option Shares,
at the same purchase price per share to be paid for the Firm Shares, for use solely in covering any
overallotments made by the Underwriters in the sale and distribution of the Firm Shares. The
options granted hereunder may be exercised at any time (but not more than once) within 30 days
after the date of the Prospectus first filed by the Company pursuant to Rule 424(b) under the 1933
Act (the “Rule 424 Prospectus”) upon notice by you to the Company and the Selling Stockholders
setting forth the aggregate number of Option Shares as to which the Underwriters are exercising the
option, the names and denominations in which the certificates for such shares are to be registered
and the time and place at which such certificates will be delivered. Such time of delivery (which
may not be earlier than the First Closing Date), being herein referred to as the “Second Closing
Date,” shall be determined by you, but if at any time other than the First Closing Date, shall not
be earlier than three nor later than 10 full business days after delivery of such notice of
exercise. If all of the Option Shares are purchased, the number of Option Shares to be purchased
from each Selling Stockholder is set forth in Schedule B hereto. If less than all of the Option
Shares are purchased, the number of Option Shares to be purchased from each of the Selling
Stockholders shall be reduced from such maximum number on a pro rata basis (as nearly as
practicable, as determined by you). The number of Option Shares to be purchased by each
Underwriter shall be determined by multiplying the number of Option Shares to be sold by the
Selling Stockholders by a fraction, the numerator of which is the number of Firm Shares to be
purchased by such Underwriter as set forth opposite its name in Schedule A and the denominator of
which is the total number of Firm Shares (subject to such adjustments to eliminate any fractional
share purchases as you in your absolute discretion may make). Certificates for the Option Shares
will be made available at the Selling Stockholders’ expense for checking and packaging at 10:00
a.m., Chicago Time, on the first full business day preceding the Second Closing Date. The manner
of payment for and delivery of the Option Shares shall be the same as for the Firm Shares as
specified in the preceding paragraph.
You have advised the Selling Stockholders that each Underwriter has authorized you to accept
delivery of its Shares, to make payment and to acknowledge receipt therefor. You, individually and
not as the Representatives of the Underwriters, may make payment for any Shares to be purchased by
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any Underwriter whose funds shall not have been received by you by the First Closing Date or
the Second Closing Date, as the case may be, for the account of such Underwriter, but any such
payment shall not relieve such Underwriter from any obligation hereunder.
Section 6. Covenants of the Company. The Company, and in the case of Section 6(i),
each of the Selling Stockholders, covenants and agrees that:
(a) The Company will advise you and each of the Selling Stockholders promptly of the
issuance by the Commission of any stop order suspending the effectiveness of the
Registration Statement or of the institution of any proceedings for that purpose, or of any
notification of the suspension of qualification of the Shares for sale in any jurisdiction
or the initiation or threatening of any proceedings for that purpose or of any examination
pursuant to Section 8(e) of the 1933 Act concerning the Registration Statement and if the
Company becomes the subject of a proceeding under Section 8A of the 1933 Act in connection
with the offering of the Shares, and will also advise you and each of the Selling
Stockholders promptly of any request of the Commission for amendment or supplement of the
Registration Statement, of any preliminary prospectus or of the Prospectus, or for
additional information.
(b) The Company will give you and each of the Selling Stockholders notice of its
intention to file or prepare any amendment to the Registration Statement (including any
post-effective amendment) or any Rule 462(b) Registration Statement or any amendment or
supplement to the Prospectus (including any revised prospectus which the Company proposes
for use by the Underwriters in connection with the offering of the Shares which differs from
the prospectus on file at the Commission at the time the Registration Statement became
effective, whether or not such revised prospectus is required to be filed pursuant to Rule
424(b)) and will furnish you and each of the Selling Stockholders with copies of any such
amendment or supplement a reasonable amount of time under the circumstances prior to such
proposed filing or use, as the case may be, and will not file any such amendment or
supplement or use any such prospectus to which you shall reasonably object in writing.
(c) If at any time when a prospectus relating to the Shares is required to be delivered
under the 1933 Act any event occurs as a result of which the Prospectus, including any
amendments or supplements, would include an 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 light of the circumstances under which they were made, not misleading, or if it
is necessary at any time to amend the Prospectus, including any amendments or supplements
thereto and including any revised prospectus which the Company proposes for use by the
Underwriters in connection with the offering of the Shares which differs from the prospectus
on file with the Commission at the time of effectiveness of the Registration Statement,
whether or not such revised prospectus is required to be filed pursuant to Rule 424(b) to
comply with the 1933 Act, the Company promptly will advise you thereof and will promptly
prepare and file with the Commission an amendment or supplement which will correct such
statement or omission or an amendment which will effect such compliance; and, in case any
Underwriter is required to deliver a prospectus nine months or more after the effective date
of the Registration Statement, the Company, upon request, but at the expense of such
Underwriter, will prepare promptly such prospectus or prospectuses as may be necessary to
permit compliance with the requirements of Section 10(a)(3) of the 1933 Act.
(d) If at any time following the issuance of an Issuer Free Writing Prospectus there
occurred or occurs an event or development as a result of which such Issuer Free Writing
Prospectus conflicted or would conflict with the information contained in the Registration
Statement or included or would include an untrue statement of a material fact or omitted or
would
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omit to state a material fact necessary to make the statements therein, in light of the
circumstances prevailing at that subsequent time, not misleading, the Company will promptly
notify the Representatives and the Agents and will promptly amend or supplement, at its own
expense, such Issuer Free Writing Prospectus to eliminate or correct such conflict, untrue
statement or omission.
(e) The Company will not acquire any capital stock of the Company prior to the earlier
of the Second Closing Date or termination or expiration of the related options nor will the
Company declare or pay any dividend or make any other distribution upon the Common Stock
payable to stockholders of record on a date prior to the earlier of the Second Closing Date
or termination or expiration of the related option, except in either case as contemplated by
the Prospectus.
(f) Not later than September 15, 2011, the Company will make generally available to its
security holders an earnings statement (which need not be audited) covering a period of at
least 12 months beginning after the effective date of the Registration Statement, which will
satisfy the provisions of the last paragraph of Section 11(a) of the 1933 Act.
(g) During such period as a prospectus is required by law to be delivered in connection
with offers and sales of the Shares by an Underwriter or dealer, upon your request, the
Company will furnish to you at its expense, subject to the provisions of subsection (c)
hereof, copies of the Registration Statement, the Prospectus, any Permitted Free Writing
Prospectus hereinafter defined, each preliminary prospectus and all amendments and
supplements to any such documents in each case as soon as available and in such quantities
as you may reasonably request, for the purposes contemplated by the 1933 Act.
(h) The Company and the Selling Stockholders will reasonably cooperate with the
Underwriters in qualifying or registering the Shares for sale under the blue sky laws of
such jurisdictions as you designate, and will continue such qualifications in effect so long
as reasonably required for the distribution of the Shares. The Company shall not be
required to qualify as a foreign corporation or to file a general consent to service of
process in any such jurisdiction where it is not currently qualified or where it would be
subject to taxation as a foreign corporation.
(i) Upon the request of either Representative and to the extent not publicly available
on the Commission’s XXXXX database, during the period of five years hereafter, the Company
will furnish you and each of the other Underwriters with a copy (i) as soon as practicable
after the filing thereof, of each report filed by the Company with the Commission; (ii) as
soon as practicable after the release thereof, of each material press release in respect of
the Company that is not disseminated via the Company’s website or a national news service;
(iii) as soon as available, of each report of the Company mailed to stockholders; and (iv)
information filed with NASDAQ or FINRA as the Representatives may reasonably request.
(j) If, at the time of effectiveness of the Registration Statement, any information
shall have been omitted therefrom in reliance upon Rule 430B, then promptly following the
execution of the Pricing Agreement, the Company will prepare, and file or transmit for
filing with the Commission in accordance with such Rule 430B and Rule 424(b), copies of an
amended Prospectus, or, if required by such Rule 430B, a post-effective amendment to the
Registration Statement (including an amended Prospectus), containing all information so
omitted. If required, the Company will prepare and file, or transmit for filing, a Rule
462(b) Registration Statement not later than the date of the execution of the Pricing
Agreement. If a Rule 462(b) Registration
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Statement is filed, the Company shall make payment of, or arrange for payment of, the
additional registration fee owing to the Commission required by Rule 111, which registration
fee shall be reimbursed by the Selling Stockholders as provided elsewhere herein.
(k) During such period beginning on the date of this Agreement and ending on the later
of the First Closing Date or the Second Closing Date, as the case may be, or such date as,
in the opinion of counsel for the Underwriters, the Prospectus is no longer required by law
to be delivered in connection with sales of the Shares by an Underwriter or dealer,
including in circumstances where such requirement may be satisfied pursuant to Rule 172
promulgated under the 1933 Act (the “Prospectus Delivery Period”), the Company will comply
with all registration, filing and reporting requirements of the Exchange Act and The NASDAQ
Global Select Market; and the Company will comply in all material respects with all
applicable provisions of the Xxxxxxxx-Xxxxx Act.
(l) During the Prospectus Delivery Period, the Company will maintain such controls and
other procedures, including without limitation those required by the Xxxxxxxx-Xxxxx Act and
the applicable regulations thereunder, that are designed to ensure that information required
to be disclosed by the Company in the reports that it files or submits under the Exchange
Act is recorded, processed, summarized and reported within the time periods specified in the
Commission’s rules and forms, including without limitation, controls and procedures designed
to ensure that information required to be disclosed by the Company in the reports that it
files or submits under the Exchange Act is accumulated and communicated to the Company’s
management, including its principal executive officer and its principal financial officer,
or persons performing similar functions, as appropriate to allow timely decisions regarding
required disclosure.
(m) During the Prospectus Delivery Period, the Company will maintain a system of
internal accounting controls designed to provide reasonable assurance that: (i) transactions
are executed in accordance with management’s general or specific authorizations; (ii)
transactions are recorded as necessary to permit preparation of financial statements in
conformity with U.S. 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) amounts reflected on the Company’s consolidated balance
sheet for assets is compared with existing assets at reasonable intervals and appropriate
action is taken with respect to any differences.
(n) The Company agrees not to, directly or indirectly, (i) offer, sell (including
“short” selling), assign, transfer, encumber, pledge, contract to sell, grant an option to
purchase, establish an open “put equivalent position” within the meaning of Rule 16a-1(h)
under the Exchange Act, or otherwise dispose of any shares of Common Stock or securities
convertible or exchangeable into, or exercisable for, Common Stock held of record or
beneficially owned (within the meaning of Rule 13d-3 under the Exchange Act) (except, in
each case, for Common Stock sold pursuant to this Agreement or issued pursuant to the
exercise of currently outstanding stock options or the grant of stock options to employees
of the Company in the ordinary course of business consistent with past practice, including
in connection with the hiring of employees, in each case under the Company’s Amended and
Restated Restricted Stock Option Plan, 2002 Equity Incentive Plan or 2007 Incentive Award
Plan); or (ii) enter into any swap or other arrangement that transfers all or a portion of
the economic consequences associated with the ownership of any Common Stock without the
prior written consent of the Representatives for a period of 90 days (the “Lock-Up Period”)
after the date of this Agreement; provided, however, that, for so long as NASD Rule 2711 or
any similar or successor rule is in effect, if (1) during the
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last 17 days of the initial Lock-Up Period, the Company releases earnings results or
material news or a material event relating to the Company occurs or (2) prior to the
expiration of the initial Lock-Up Period, the Company announces that it will release
earnings results during the 16-day period beginning on the last day of the initial Lock-Up
Period, then, in either case, the Lock-Up Period will be extended until the expiration of
the 18-day period beginning on the date of release of the earnings results or the occurrence
of the material news or material event, as applicable, unless the Representatives waive, in
writing, such extension.
Section 7. Covenants of the Company and the Underwriters. The Company represents and
agrees that, unless it obtains the prior consent of the Representatives, and each Underwriter,
severally and not jointly, represents and agrees that, unless it obtains the prior consent of the
Company and the Representatives, it has not made and will not make any offer relating to the Shares
that would constitute an “issuer free writing prospectus,” as defined in Rule 433, or that would
otherwise constitute a “free writing prospectus,” as defined in Rule 405, required to be filed with
the Commission. Any such free writing prospectus consented to by the Representatives or by the
Company and the Representatives, as the case may be, is hereinafter referred to as a “Permitted
Free Writing Prospectus.” The Company represents that it has treated and agrees that it will treat
each Permitted Free Writing Prospectus as an “issuer free writing prospectus,” as defined in Rule
433, and has complied and will comply with the requirements of Rule 433 applicable to any Permitted
Free Writing Prospectus, including timely filing with the Commission where required, legending and
record-keeping.
Section 8. Payment of Expenses. Whether or not the transactions contemplated
hereunder are consummated or this Agreement becomes effective as to all of its provisions or is
terminated, the Company agrees to pay (i) all costs, fees and expenses (other than legal fees and
disbursements of counsel for the Underwriters and the expenses incurred by the Underwriters, which
are the subject of clause (ii) below) incurred in connection with the performance of the
obligations of the Company and the Selling Stockholders hereunder, including without limiting the
generality of the foregoing, all fees and expenses of legal counsel for the Company and the Selling
Stockholders and of the Company’s independent accountants, all costs and expenses incurred in
connection with the preparation, printing, filing and distribution (including electronic delivery)
of the Registration Statement, each preliminary prospectus, any Permitted Free Writing Prospectus
and the Prospectus (including all exhibits and financial statements) and all amendments and
supplements provided for herein, this Agreement, the Pricing Agreement and a blue sky memorandum,
(ii) all reasonable third-party costs, fees and expenses (including reasonable legal fees and
disbursements of outside counsel for the Underwriters) incurred by the Underwriters in connection
with qualifying or registering all or any part of the Shares for offer and sale under blue sky
laws, including clearance of such offering with FINRA; (iii) all fees and expenses of the Company’s
transfer agent, printing of the certificates for the Shares and all transfer taxes, if any, with
respect to the sale and delivery of the Shares to the several Underwriters; and (iv) all
third-party costs, fees and expenses (including, without limitation, any damages or other amounts
payable in connection with legal or contractual liability) associated with the reforming of any
contracts for sale of the Shares made by the Underwriters caused by a breach of the representation
contained in the second paragraph of Section 2(c).
Section 9. Conditions of the Obligations of the Underwriters. The obligations of the
several Underwriters to purchase and pay for the Firm Shares on the First Closing Date and the
Option Shares on the Second Closing Date shall be subject to the accuracy of the representations
and warranties on the part of the Company and each of the Selling Stockholders herein set forth as
of the date hereof and as of the First Closing Date or the Second Closing Date, as the case may be,
to the accuracy of the statements of officers of the Company made pursuant to the provisions
hereof, to the performance by the Company and each of the Selling Stockholders of their respective
obligations hereunder, and to the following additional conditions:
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(a) No stop order suspending the effectiveness of the Registration Statement shall have
been issued and no proceedings for that purpose shall have been instituted or shall be
pending or, to the knowledge of the Company, the Selling Stockholders or you, shall be
contemplated by the Commission. If the Company has elected to rely upon Rule 430B, the
information concerning the public offering price of the Shares and price-related
information, and such other information omitted from the Base Prospectus in reliance on Rule
430B, shall have been transmitted to the Commission for filing pursuant to Rule 424(b) in
the manner and within the prescribed time period (without reliance on Rule 424(b)(8)) and
the Company will provide evidence satisfactory to the Representatives of such timely filing
(or a post-effective amendment providing such information shall have been filed and declared
effective in accordance with the requirements of Rules 430B and 424(b)). If a Rule 462(b)
Registration Statement is required, such Registration Statement shall have been transmitted
to the Commission for filing and become effective within the prescribed time period and,
prior to the First Closing Date, the Company shall have provided evidence of such filing and
effectiveness in accordance with Rule 462(b).
(b) The legality and sufficiency of the authorization, issuance and sale or transfer
and sale of the Shares hereunder, the validity and form of the certificates representing the
Shares, the execution and delivery of this Agreement and the Pricing Agreement, and all
corporate proceedings and other legal matters incident thereto, and the form of the
Registration Statement, the Disclosure Package, any Issuer Limited Use Free Writing
Prospectus and the Prospectus (except financial statements) shall have been approved by
counsel for the Underwriters exercising reasonable judgment.
(c) You shall not have advised the Company that the Registration Statement, the
Disclosure Package, any Issuer Limited Use Free Writing Prospectus, when considered together
with the Disclosure Package, or the Prospectus or any amendment or supplement thereto,
contains an untrue statement of fact, which, in the opinion of counsel for the Underwriters,
is material or omits to state a fact which, in the opinion of such counsel, is material and
is required to be stated therein or necessary to make the statements therein not misleading.
(d) Subsequent to the execution and delivery of this Agreement, there shall not have
occurred any material adverse change, or any development involving a prospective material
adverse change, in or affecting particularly the business or properties of the Company,
whether or not arising in the ordinary course of business, which, in the judgment of the
Representatives, makes it impractical or inadvisable to proceed with the public offering,
sale or delivery of the Shares as contemplated hereby.
(e) There shall have been furnished to you, as Representatives of the Underwriters, on
the First Closing Date or the Second Closing Date, as the case may be, except as otherwise
expressly provided below:
(i) An opinion and negative assurance letter of Xxxxxx & Xxxxxxx LLP, counsel
for the Company, each addressed to the Underwriters and dated the First Closing Date
or the Second Closing Date, as the case may be, each in form and substance
reasonably satisfactory to the Underwriters.
(ii) Opinions of counsel for each of the Selling Stockholders, in each case
addressed to the Underwriters and dated the First Closing Date or the Second Closing
Date, as the case may be, in form and substance reasonably satisfactory to the
Underwriters.
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(iii) Such opinion or opinions of Sidley Austin LLP, counsel for the
Underwriters, dated the First Closing Date or the Second Closing Date, as the case
may be, with respect to the existence of the Company, the validity of the Shares,
the Registration Statement, the Disclosure Package and the Prospectus and other
related matters as you may reasonably require, and the Company shall have furnished
to such counsel such documents and shall have exhibited to them such papers and
records as they may reasonably request for the purpose of enabling them to pass upon
such matters.
(iv) A certificate of the chief executive officer and the principal financial
officer of the Company, dated the First Closing Date or the Second Closing Date, as
the case may be, to the effect that:
(1) the representations and warranties of the Company set forth in
Section 2 of this Agreement are true and correct as of the date of this
Agreement and as of the First Closing Date or the Second Closing Date, as
the case may be, 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 such Closing Date;
(2) the Commission has not issued an order preventing or suspending the
use of the Prospectus or any preliminary prospectus filed as a part of the
Registration Statement or any amendment thereto; no stop order suspending
the effectiveness of the Registration Statement has been issued; and to the
best knowledge of the respective signers, no proceedings for that purpose
have been instituted or are pending or contemplated under the 1933 Act; and
(3) subsequent to the date of the most recent financial statements
included in the Registration Statement and Prospectuses, and except as set
forth or contemplated in the Prospectuses, there has not been any change
that has had or would reasonably be expected to have a material adverse
effect upon the Company or any material change in its short-term debt or
long-term debt.
The delivery of the certificate provided for in this subparagraph shall be and
constitute a representation and warranty of the Company as to the facts required in
the immediately foregoing clauses (1), (2) and (3) to be set forth in said
certificate.
(v) A certificate of each of Xxx Xxxxx, on behalf of herself, and Xxxxxx Xxxxx,
Xxxxx XxXxxxxxxx and/or Xxxx Xxxxxx, on behalf of the GRP Selling Stockholders (as
identified in Schedule B hereto), dated the First Closing Date or the Second Closing
Date, as the case may be, to the effect that the representations and warranties of
such Selling Stockholder set forth in Section 3 are true and correct as of such date
and such Selling Stockholder has complied with all the agreements and satisfied all
the conditions on the part of such Selling Stockholder to be performed or satisfied
at or prior to such date.
(vi) At the time the Pricing Agreement is executed and also on the First
Closing Date or the Second Closing Date, as the case may be, there shall be
delivered to you a letter addressed to you, as Representatives of the Underwriters,
from Ernst & Young LLP, an independent registered public accountant firm, the first
one to be dated the date of the Pricing Agreement, the second one to be dated the
First Closing Date and the third one (in the event of a second closing) to be dated
the Second Closing Date, in
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form and substance reasonably satisfactory to the Underwriters, containing
statements and information of the type customarily included in accountants’ “comfort
letters” to underwriters with respect to the financial statements and certain
financial information contained or incorporated by reference in the Prospectus.
There shall not have been any change or decrease specified in the letters referred
to in this subparagraph which makes it impractical or inadvisable in the judgment of
the Representatives to proceed with the public offering or purchase of the Shares as
contemplated hereby.
(vii) A certificate of the chief executive officer and the principal financial
officer of the Company, dated the First Closing Date or the Second Closing Date, as
the case may be, verifying the truth and accuracy of such statistical or financial
figures included in the Prospectus which you may reasonably request and which have
not been otherwise verified by the letters referred to in clause (vi) above, such
verification to include the provision of documentary evidence supporting any such
statistical or financial figure.
(viii) The “lock-up” letter agreements between you and each of the Selling
Stockholders, officers and directors of the Company relating to sales and certain
other dispositions of shares of Common Stock or certain other securities, delivered
to you on or before the date hereof, shall be in full force and effect on the First
Closing Date or the Second Closing Date, as the case may be.
(ix) Such further certificates and documents as you may reasonably request.
All such opinions, certificates, letters and documents shall be in compliance with the
provisions hereof only if they are satisfactory to you and to Sidley Austin LLP, counsel for the
Underwriters, which approval shall not be unreasonably withheld. The Company shall furnish you
with such manually signed or conformed copies of such opinions, certificates, letters and documents
as you request.
If any condition to the Underwriters’ obligations hereunder to be satisfied prior to or at the
First Closing Date is not so satisfied, this Agreement at your election will terminate upon
notification to the Company and the Selling Stockholders without liability on the part of any
Underwriter or the Company or the Selling Stockholders, except for the expenses to be paid or
reimbursed by the Company pursuant to Sections 8 and 10 hereof and except to the extent provided in
Section 12 hereof.
Section 10. Reimbursement of Underwriters’ Expenses. If the sale to the Underwriters
of the Firm Shares on the First Closing Date is not consummated because any condition of the
Underwriters’ obligations hereunder is not satisfied or because of any refusal, inability or
failure on the part of the Company or any of the Selling Stockholders to perform any agreement
herein or to comply with any provision hereof, unless such failure to satisfy such condition or to
comply with any provision hereof is due to the default or omission of any Underwriter, the Company
agrees to reimburse you and the other Underwriters upon demand for all out-of-pocket expenses
(including reasonable fees and disbursements of counsel) that shall have been reasonably incurred
by you and them in connection with the proposed purchase and the sale of the Shares. Any such
termination shall be without liability of any party to any other party except that the provisions
of this Section 10, Section 8 and Section 12 shall at all times be effective and shall apply.
Section 11. Effectiveness of Registration Statement. You and the Company will use
your and its best efforts to prevent the issuance of any stop order suspending the effectiveness of
the
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Registration Statement and, if such stop order be issued, to obtain as soon as practicable the
lifting thereof.
Section 12. Indemnification. (a) The Company agrees to indemnify and hold harmless
each Underwriter, its affiliates, and each person, if any, who controls any Underwriter within the
meaning of the 1933 Act or the Exchange Act against any losses, claims, damages or liabilities,
joint or several, to which such Underwriter or such controlling person may become subject under the
1933 Act, the Exchange Act or other federal or state statutory law or regulation, at common law or
otherwise (including in settlement of any litigation if such settlement is effected with the
written consent of the Company), 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, including the information deemed to
be part of the Registration Statement at the time specified in Rule 430B, any preliminary
prospectus, any Issuer Free Writing Prospectus, the Prospectus, or any amendment or supplement
thereto, or arise out of or are based upon the omission or alleged omission to state therein a
material fact, in the case of the Registration Statement or any amendment or supplement thereto,
required to be stated therein or necessary to make the statements therein not misleading and, in
the case of any preliminary prospectus, any Issuer Free Writing Prospectus, the Prospectus, or any
amendment or supplement thereto, necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading; and will reimburse each Underwriter and
each such controlling person for any legal or other expenses reasonably incurred by such
Underwriter or such controlling person in connection with investigating or defending any such loss,
claim, damage, liability or action; provided, however, that 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 an untrue statement or alleged untrue statement or omission or alleged omission made in the
Registration Statement, any preliminary prospectus, any Issuer Free Writing Prospectus, the
Prospectus or any amendment or supplement thereto in reliance upon and in conformity with written
information furnished to the Company by or on behalf of any Underwriter through the Representatives
or the Selling Stockholders, specifically for use therein. In addition to its other obligations
under this Section 12(a), the Company agrees that, as an interim measure during the pendency of any
claim, action, investigation, inquiry or other proceeding arising out of or based upon any
statement or omission, or any alleged statement or omission, described in this Section 12(a), it
will reimburse the Underwriters on a monthly basis for all reasonable legal and other expenses
incurred in connection with investigating or defending any such claim, action, investigation,
inquiry or other proceeding, notwithstanding the absence of a judicial determination as to the
propriety and enforceability of the Company’s obligation to reimburse the Underwriters for such
expenses and the possibility that such payments might later be held to have been improper by a
court of competent jurisdiction. This indemnity agreement will be in addition to any liability
which the Company may otherwise have.
(b) Each of the Selling Stockholders agrees severally and not jointly in proportion to the
number of Shares to be sold by such Selling Stockholder hereunder to indemnify and hold harmless
each Underwriter, its affiliates, and each person, if any, who controls any Underwriter within the
meaning of the 1933 Act or the Exchange Act against any losses, claims, damages or liabilities,
joint or several, to which such Underwriter or such controlling person may become subject under the
1933 Act, the Exchange Act or other federal or state statutory law or regulation, at common law or
otherwise (including in settlement of any litigation if such settlement is effected with the
written consent of such Selling Stockholder), 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, including
the information deemed to be part of the Registration Statement at the time specified in Rule 430B,
any preliminary prospectus, any Issuer Free Writing Prospectus, the Prospectus, or any amendment or
supplement thereto, or arise out of or are based upon the omission or alleged omission to state
therein a material fact about the Selling Stockholder required to be stated therein
-22-
or necessary to make the statements therein about the Selling Stockholder not misleading; and
will reimburse each Underwriter and each such controlling person for any legal or other expenses
reasonably incurred by such Underwriter or such controlling person in connection with investigating
or defending any such loss, claim, damage, liability or action; provided, however, that the
obligations under this Section 12(b) shall only apply to untrue statements or omissions, or alleged
untrue statements or omissions, made in the Registration Statement, any preliminary prospectus, any
Issuer Free Writing Prospectus, the Prospectus, or any amendment or supplement thereto in reliance
upon and in conformity with written information relating to such Selling Stockholder furnished to
the Company by such Selling Stockholder expressly for use therein (and the parties hereto agree
that the only information included in the foregoing documents in reliance upon and in conformity
with written information relating to such Selling Stockholder furnished to the Company by such
Selling Stockholder expressly for use therein is the information relating to such Selling
Stockholder set forth under the caption “Selling Stockholders” and the footnotes thereunder
(excluding any percentages or outstanding share totals of the Company set forth therein)) in both
the Base Prospectus and the preliminary prospectus supplement relating to the Shares; provided,
further, that such Selling Stockholder 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 an untrue statement or alleged
untrue statement or omission or alleged omission made in the Registration Statement, any
preliminary prospectus, any Issuer Free Writing Prospectus, the Prospectus or any amendment or
supplement thereto in reliance upon and in conformity with written information furnished to the
Company by or on behalf of any Underwriter through the Representatives, specifically for use
therein. In addition to its other obligations under this Section 12(b), each of the Selling
Stockholders agrees that, as an interim measure during the pendency of any claim, action,
investigation, inquiry or other proceeding arising out of or based upon any statement or omission,
or any alleged statement or omission, described in this Section 12(b), it will reimburse the
Underwriters on a monthly basis for all reasonable legal and other expenses incurred in connection
with investigating or defending any such claim, action, investigation, inquiry or other proceeding,
notwithstanding the absence of a judicial determination as to the propriety and enforceability of
such Selling Stockholder’s obligation to reimburse the Underwriters for such expenses and the
possibility that such payments might later be held to have been improper by a court of competent
jurisdiction. Notwithstanding anything to the contrary in this Section 12(b), in no event shall
the liability of a Selling Stockholder exceed the net proceeds actually received by such Selling
Stockholder from the sale of its respective Shares pursuant to this Agreement. This indemnity
agreement will be in addition to any liability which such Selling Stockholder may otherwise have.
(c) Each Underwriter will severally indemnify and hold harmless the Company, each of its
directors, each of its officers who signed the Registration Statement, the Selling Stockholders and
each person, if any, who controls the Company or the Selling Stockholders within the meaning of the
1933 Act or the Exchange Act, against any losses, claims, damages or liabilities to which the
Company, or any such director, officer, Selling Stockholder or controlling person may become
subject under the 1933 Act, the Exchange Act or other federal or state statutory law or regulation,
at common law or otherwise (including in settlement of any litigation, if such settlement is
effected with the written consent of such Underwriter), insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon any untrue or alleged
untrue statement of any material fact contained in the Registration Statement, any preliminary
prospectus, any Issuer Free Writing Prospectus, the Prospectus, or any amendment or supplement
thereto, or arise out of or are based upon the omission or alleged omission to state therein a
material fact, in the case of the Registration Statement or any amendment or supplement thereto,
required to be stated therein or necessary to make the statements therein not misleading and, in
the case of any preliminary prospectus, any Issuer Free Writing Prospectus, the Prospectus, or any
amendment or supplement thereto, necessary to make the statements therein, in light of the
circumstances under which they were made, 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 the Registration Statement, any preliminary prospectus, any Issuer Free Writing
Prospectus, the
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Prospectus, or any amendment or supplement thereto in reliance upon and in conformity with
Section 4 of this Agreement or any other written information furnished to the Company by such
Underwriter through the Representatives specifically for use in the preparation thereof; and will
reimburse any legal or other expenses reasonably incurred by the Company, or any such director,
officer, Selling Stockholder or controlling person in connection with investigating or defending
any such loss, claim, damage, liability or action. In addition to their other obligations under
this Section 12(c), the Underwriters agree that, as an interim measure during the pendency of any
claim, action, investigation, inquiry or other proceeding arising out of or based upon any
statement or omission, or any alleged statement or omission, described in this Section 12(c), they
will reimburse the Company and the Selling Stockholders on a monthly basis for all reasonable legal
and other expenses incurred in connection with investigating or defending any such claim, action,
investigation, inquiry or other proceeding, notwithstanding the absence of a judicial determination
as to the propriety and enforceability of the Underwriters’ obligation to reimburse the Company and
the Selling Stockholders for such expenses and the possibility that such payments might later be
held to have been improper by a court of competent jurisdiction. This indemnity agreement will be
in addition to any liability which such Underwriter may otherwise have.
(d) Promptly after receipt by an indemnified party under this Section 12 of notice of the
commencement of any action, such indemnified party will, if a claim in respect thereof is to be
made against an indemnifying party under this Section 12, notify the indemnifying party 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 except to the extent that the indemnifying
party was prejudiced by such failure to notify. In case any such action is brought against any
indemnified party, and it notifies an indemnifying party of the commencement thereof, the
indemnifying party will be entitled to participate in, and, to the extent that it may wish, jointly
with all other indemnifying parties similarly notified, to assume the defense thereof, with counsel
reasonably satisfactory to such indemnified party; provided, however, if the defendants in any such
action include both the indemnified party and the indemnifying party and the indemnified party
shall have reasonably concluded based on the advice of outside counsel 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, or the indemnified and indemnifying parties may have
conflicting interests which would make it inappropriate for the same counsel to represent both of
them, the indemnified party or parties shall have the right to select separate counsel to assume
such legal defense and otherwise to 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 12 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
such counsel in connection with the assumption of legal defense 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 paragraph (a) representing all indemnified parties not having different or additional
defenses or potential conflicting interest among themselves who are parties to such action), (ii)
the indemnifying party shall not have employed counsel reasonably 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. No indemnifying party shall, without
the prior written consent of the indemnified party, effect any settlement of any pending or
threatened proceeding in respect of which any indemnified party is or could have been a party and
indemnity could have been sought hereunder by such indemnified party, unless such settlement
includes an unconditional release of such indemnified party from all liability arising out of such
proceeding.
-24-
(e) If the indemnification provided for in this Section 12 is unavailable to an indemnified
party under paragraphs (a), (b) or (c) hereof in respect of any losses, claims, damages or
liabilities referred to therein, then each applicable indemnifying party, in lieu of indemnifying
such indemnified party, shall contribute to the amount paid or payable by such indemnified party as
a result of such losses, claims, damages or liabilities (i) in such proportion as is appropriate to
reflect the relative benefits received by the Company, the Selling Stockholders and the
Underwriters from the offering of the Shares or (ii) if the allocation provided by clause (i) above
is not permitted by applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) above but also the relative fault of the Company, the
Selling Stockholders and the Underwriters in connection with the statements or omissions which
resulted in such losses, claims, damages or liabilities, as well as any other relevant equitable
considerations. The respective relative benefits received by the Company, the Selling Stockholders
and the Underwriters shall be deemed to be in the same proportion, in the case of the Company and
the Selling Stockholders, as the total price paid to the Company and the Selling Stockholders for
the Shares by the Underwriters (net of underwriting discount but before deducting expenses) bears
to, and in the case of the Underwriters, as the underwriting discount received by them bears to,
the total of such amounts paid to the Company and the Selling Stockholders and received by the
Underwriters as underwriting discount, in each case as contemplated by the Prospectus. The
relative fault of the Company, the Selling Stockholders and the Underwriters shall be determined by
reference to, among other things, whether the untrue or alleged untrue statement of a material fact
or the omission to state a material fact relates to information supplied by the Company, the
Selling Stockholders or the Underwriters and the parties’ relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission. The amount paid or
payable by a party as a result of the losses, claims, damages and liabilities referred to above
shall be deemed to include any legal or other fees or expenses reasonably incurred by such party in
connection with investigating or defending any action or claim.
The Company, each of the Selling Stockholders and the Underwriters agree that it would not be
just and equitable if contribution pursuant to this Section 12(e) were determined by pro rata
allocation or by any other method of allocation which does not take account of the equitable
considerations referred to in the immediately preceding paragraph. Notwithstanding the provisions
of this Section 12(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 0000 Xxx) shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Underwriters’ obligations to contribute pursuant to this Section
12(e) are several in proportion to their respective underwriting commitments and not joint.
(f) The provisions of this Section 12 shall survive any termination of this Agreement.
Section 13. Default of Underwriters. It shall be a condition to the agreement and obligation
of each of the Selling Stockholders to sell and deliver the Shares hereunder, and of each
Underwriter to purchase the Shares hereunder, that, except as hereinafter in this paragraph
provided, each of the Underwriters shall purchase and pay for all Shares agreed to be purchased by
such Underwriter hereunder upon tender to the Representatives of all such Shares in accordance with
the terms hereof. If any Underwriter or Underwriters default in their obligations to purchase
Shares hereunder on the First Closing Date and the aggregate number of Shares which such defaulting
Underwriter or Underwriters agreed but failed to purchase does not exceed 10 percent of the total
number of Shares which the Underwriters are obligated to purchase on the First Closing Date, the
Representatives may make
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arrangements satisfactory to the Company and the Selling Stockholders for the purchase of such
Shares by other persons, including any of the Underwriters, but if no such arrangements are made by
such date the nondefaulting Underwriters shall be obligated severally, in proportion to their
respective commitments hereunder, to purchase the Shares which such defaulting Underwriters agreed
but failed to purchase on such date. If any Underwriter or Underwriters so default and the
aggregate number of Shares with respect to which such default or defaults occur is more than the
above percentage and arrangements satisfactory to the Representatives, the Company and the Selling
Stockholders for the purchase of such Shares by other persons are not made within 36 hours after
such default, this Agreement will terminate without liability on the part of any nondefaulting
Underwriter or the Company or the Selling Stockholders, except for the expenses to be paid by the
Company pursuant to Section 8 hereof and except to the extent provided in Section 12 hereof.
In the event that Shares to which a default relates are to be purchased by the nondefaulting
Underwriters or by another party or parties, the Representatives or the Company shall have the
right to postpone the First Closing Date for not more than seven business days in order that the
necessary changes in the Registration Statement, Prospectus and any other documents, as well as any
other arrangements, may be effected. As used in this Agreement, the term “Underwriter” includes
any person substituted for an Underwriter under this Section 13. Nothing herein will relieve a
defaulting Underwriter from liability for its default.
Section 14. Effective Date. This Agreement shall become effective immediately as to
Sections 8, 10, 12 and 15 and as to all other provisions at 10:00 a.m., Chicago Time, on the day
following the date upon which the Pricing Agreement is executed and delivered, unless such a day is
a Saturday, Sunday or holiday (and in that event this Agreement shall become effective at such hour
on the business day next succeeding such Saturday, Sunday or holiday); but this Agreement shall
nevertheless become effective at such earlier time after the Pricing Agreement is executed and
delivered as you may determine on and by notice to the Company or by release of any Shares for sale
to the public. For the purposes of this Section 14, the Shares shall be deemed to have been so
released upon the release for publication of any newspaper advertisement relating to the Shares or
upon the release by you of written communications (i) advising Underwriters that the Shares are
released for public offering, or (ii) offering the Shares for sale to securities dealers, whichever
may occur first.
Section 15. Termination. Without limiting the right to terminate this Agreement
pursuant to any other provision hereof:
(a) This Agreement may be terminated by the Company by notice to you and the Selling
Stockholders or by you by notice to the Company and the Selling Stockholders at any time
prior to the time this Agreement shall become effective as to all its provisions, and any
such termination shall be without liability on the part of the Company or the Selling
Stockholders to any Underwriter (except for the expenses to be paid or reimbursed pursuant
to Section 8 hereof and except to the extent provided in Section 12 hereof) or of any
Underwriter to the Company or the Selling Stockholders.
(b) This Agreement may also be terminated by you prior to the First Closing Date, and
the options referred to in Section 5, if exercised, may be cancelled at any time prior to
the Second Closing Date, if (i) trading in securities on the New York Stock Exchange or The
Nasdaq Stock Market shall have been suspended or minimum prices shall have been established
on such exchange or market, or (ii) a banking moratorium shall have been declared by
Illinois, New York, or United States authorities, or (iii) there shall have been any
material adverse change in financial markets or any material adverse change in political,
economic or financial conditions which, in the opinion of the Representatives, either
renders it impracticable or inadvisable to proceed with
-26-
the offering and sale of the Shares on the terms set forth in the Prospectus or
materially and adversely affects the market for the Shares, or (iv) there shall have been an
outbreak of major armed hostilities between the United States and any foreign power or
terrorist organization which, in the opinion of the Representatives, makes it impractical or
inadvisable to offer or sell the Shares, or (v) there shall have been, since the time of
execution of this Agreement or since the respective dates as of which information is given
in the Prospectus, any material change in the condition, financial or otherwise, or in the
earnings, business affairs or business prospects of the Company, whether or not arising in
the ordinary course of business. Any termination pursuant to this paragraph (b) shall be
without liability on the part of any Underwriter to the Company or the Selling Stockholders
or on the part of the Company or the Selling Stockholders to any Underwriter (except for
expenses to be paid or reimbursed pursuant to Section 8 hereof and except to the extent
provided in Section 12 hereof).
Section 16. Representations and Indemnities to Survive Delivery. The respective
indemnities, agreements, representations, warranties and other statements of the Company, of its
officers, of the Selling Stockholders and of the several 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, any Selling Stockholder or the Company or any of its or their
partners, principals, members, officers or directors or any controlling person, and will survive
delivery of and payment for the Shares sold hereunder.
Section 17. Notices. All communications hereunder will be in writing and, if sent to
the Underwriters will be mailed, delivered or telegraphed and confirmed to you c/o Xxxxxxx Xxxxx &
Company, L.L.C., 000 Xxxx Xxxxx Xxxxxx, Xxxxxxx, Xxxxxxxx 00000, with copies to c/o Wells Fargo
Securities, LLC, 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Equity Syndicate Department
(facsimile: (000) 000-0000), and to Xxxxxx X. Xxxxxxx, c/o Sidley Austin LLP, Xxx Xxxxx Xxxxxxxx
Xxxxxx, Xxxxxxx, Xxxxxxxx 00000; if sent to the Company will be mailed, delivered or telegraphed
and confirmed to the Company at its corporate headquarters with a copy to Xxxxxxx X. Xxxxxx, c/x
Xxxxxx & Xxxxxxx LLP, 000 Xxxxx Xxxxxx Xxxxx, Xxxxx 0000, Xxxxxxx, Xxxxxxxx 00000; if sent to one
of the Selling Stockholders, will be mailed, delivered or telegraphed and confirmed to such Selling
Stockholders at such address as they have previously furnished to the Company and the
Representatives.
Section 18. No Advisory or Fiduciary Relationship. The Company and each of the
Selling Stockholders acknowledges and agrees that (a) the purchase and sale of the Shares pursuant
to this Agreement, including the determination of the public offering price of the Shares and any
related discounts and commissions, is an arm’s-length commercial transaction between the Company
and the Selling Stockholders, on the one hand, and the several Underwriters, on the other hand, (b)
in connection with the offering of the Shares contemplated by this Agreement and the process
leading to such transaction each Underwriter is and has been acting solely as a principal and is
not the agent or fiduciary of the Company, the Selling Stockholders, or its or their stockholders,
creditors, employees or any other party, (c) no Underwriter has assumed or will assume an advisory
or fiduciary responsibility in favor of the Company or the Selling Stockholders with respect to the
offering of the Shares contemplated by this Agreement or the process leading thereto (irrespective
of whether such Underwriter has advised or is currently advising the Company on other matters) and
no Underwriter has any obligation to the Company or the Selling Stockholders with respect to the
offering of the Shares contemplated by this Agreement except the obligations expressly set forth in
this Agreement, (d) the Underwriters and their respective affiliates may be engaged in a broad
range of transactions that involve interests that differ from those of the Company and the Selling
Stockholders and (e) the Underwriters have not provided any legal, accounting, regulatory or tax
advice with respect to the offering of the Shares contemplated by this Agreement and the Company
and the Selling Stockholders have consulted its and their own legal, accounting, regulatory and tax
advisors to the extent it and they deemed appropriate.
-27-
Section 19. Successors. This Agreement and the Pricing Agreement will inure to the
benefit of and be binding upon the parties hereto and their respective successors, personal
representatives and assigns, and to the benefit of the officers and directors and controlling
persons referred to in Section 12, and no other person will have any right or obligation hereunder.
The term “successors” shall not include any purchaser of the Shares as such from any of the
Underwriters merely by reason of such purchase.
Section 20. Representation of Underwriters. You will act as Representatives for the
several Underwriters in connection with this financing, and any action under or in respect of this
Agreement taken by you will be binding upon all the Underwriters.
Section 21. Partial Unenforceability. If any section, paragraph or provision of this
Agreement is for any reason determined to be invalid or unenforceable, such determination shall not
affect the validity or enforceability of any other section, paragraph or provision hereof.
Section 22. Applicable Law. This Agreement and the Pricing Agreement shall be
governed by and construed in accordance with the laws of the State of Illinois.
[Remainder of page intentionally left blank]
-28-
If the foregoing is in accordance with your understanding of our agreement, kindly sign and
return to us the enclosed duplicates hereof, whereupon it will become a binding agreement among the
Company, the Selling Stockholders and the several Underwriters including you, all in accordance
with its terms.
| Very truly yours, | ||||||
| Ulta Salon, Cosmetics & Fragrance, Inc. | ||||||
| By: Name: |
/s/ Xxxxx X. Xxxxxx
|
|||||
| Title: | Chief Financial Officer and Assistant Secretary | |||||
| Acting as Agent and attorney-in-fact of the several GRP Selling Stockholders named in Schedule B. |
||||||
| By: Name: |
/s/ Xxxxxx Xxxxx
|
|||||
| Acting as Agent and attorney-in-fact of Xxx Xxxxx |
||||||
| By: Name: |
/s/ Xxx Xxxxx
|
|||||
-29-
The foregoing Agreement is hereby
confirmed and accepted as of
the date first above written.
confirmed and accepted as of
the date first above written.
Xxxxxxx Xxxxx & Company, L.L.C.
Xxxxx Fargo Securities, LLC
Xxxxx Fargo Securities, LLC
Acting as Representatives of the
several Underwriters named in
Schedule A.
several Underwriters named in
Schedule A.
By: Xxxxxxx Xxxxx & Company, L.L.C.
By: |
/s/ Xxxxx X. Xxxxxxx | |||
Name:
|
||||
Name:
|
Xxxxx X. Xxxxxxx | |||
Title:
|
Principal |
By: Xxxxx Fargo Securities, LLC
By: Name: |
/s/ Xxxxx Xxxxxx
|
|||
Title:
|
Director |
-30-
Schedule A
| Number of | ||||
| Firm Shares | ||||
| Underwriter | to be Purchased | |||
Xxxxxxx Xxxxx & Company, L.L.C. |
3,231,401 | |||
Xxxxx Fargo Securities, LLC |
2,872,356 | |||
Xxxxx Xxxxxxx & Co. |
1,077,133 | |||
Xxxxxx Xxxxxx Partners LLC |
1,077,133 | |||
Xxxxxxx Xxxxx & Associates, Inc. |
718,089 | |||
Total |
8,976,112 | |||
A-1
Schedule B
| Number of Firm | Number of Option | |||||||
| GRP Selling Stockholders | Shares to be Sold | Shares to be Sold | ||||||
AOS Partners, L.P |
4,786,492 | 689,808 | ||||||
GRPVC, L.P. |
1,124,619 | 326,575 | ||||||
GRP AQ, L.P. |
1,157,989 | — | ||||||
GRP Management Services Corp. |
554,808 | 94,960 | ||||||
GRP II Investors, L.P. |
456,850 | 78,194 | ||||||
GRP II Partners, L.P. |
171,960 | 24,782 | ||||||
The Xxxxxxxx & Xxxxxx Xxxxx Revocable Trust dated
June 21, 2007 |
50,709 | 8,679 | ||||||
Xxxxx XxXxxxxxxx |
58,556 | 10,022 | ||||||
Xxxx Xxxxxx |
14,526 | 2,486 | ||||||
The Xxxx and Xxxx Xxxxxx Trust UAD 7/3/07 |
6,552 | 1,121 | ||||||
Xxxxx Xxxxx |
2,183 | 374 | ||||||
GRP Operations, Inc. |
243 | 41 | ||||||
Other Selling Stockholder |
||||||||
Xxx Xxxxx |
590,625 | 109,375 | ||||||
Total |
8,976,112 | 1,346,417 | ||||||
B-1
Schedule C
Issuer General Use Free Writing Prospectuses
Issuer General Use Free Writing Prospectuses
[None]
C-1
Exhibit A
Ulta Salon, Cosmetics & Fragrance, Inc.
8,976,112 Shares of Common Stock2
Pricing Agreement
June 10, 2010
Xxxxxxx Xxxxx & Company, L.L.C.
Xxxxx Fargo Securities, LLC
As Representatives of the Several
Underwriters
c/o Xxxxxxx Xxxxx & Company, L.L.C.
000 Xxxx Xxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Xxxxx Fargo Securities, LLC
As Representatives of the Several
Underwriters
c/o Xxxxxxx Xxxxx & Company, L.L.C.
000 Xxxx Xxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Ladies and Gentlemen:
Reference is made to the Underwriting Agreement dated June 10, 2010 (the “Underwriting
Agreement”) relating to the sale by the Selling Stockholders, and the purchase by the several
Underwriters for whom Xxxxxxx Xxxxx & Company, L.L.C. and Xxxxx Fargo Securities, LLC are acting as
representatives (the “Representatives”), of the above Shares. All terms herein shall have the
definitions contained in the Underwriting Agreement except as otherwise defined herein.
Pursuant to Section 5 of the Underwriting Agreement, the Company and each of the Selling
Stockholders agrees with the Representatives as follows:
1. The public offering price per share for the Shares shall be $22.25.
2. The purchase price per share for the Shares to be paid by the several Underwriters shall be
$21.36, being an amount equal to the public offering price set forth above less $0.89 per share.
| 2 | Plus options to acquire up to an aggregate of 1,346,417 additional shares to cover overallotments. |
If the foregoing is in accordance with your understanding of our agreement, kindly sign and
return to us the enclosed duplicates hereof, whereupon it will become a binding agreement among the
Company, the Selling Stockholders and the several Underwriters, including you, all in accordance
with its terms.
| Very truly yours, | ||||||
| Ulta Salon, Cosmetics & Fragrance, Inc. | ||||||
| By: | ||||||
| Name: | ||||||
| Title: | ||||||
| Acting as Agent and attorney-in-fact of the several GRP Selling Stockholders named in Schedule B to the Underwriting Agreement. |
||||||
| By: | ||||||
| Name: | ||||||
| Acting as Agent and attorney-in-fact of Xxx Xxxxx |
||||||
| By: | ||||||
| Name: | ||||||
Signature page to Pricing Agreement
The foregoing Agreement is hereby
confirmed and accepted as of
the date first above written.
confirmed and accepted as of
the date first above written.
The foregoing Agreement is hereby
confirmed and accepted as of
the date first above written.
confirmed and accepted as of
the date first above written.
Xxxxxxx Xxxxx & Company, L.L.C.
Xxxxx Fargo Securities, LLC
Xxxxx Fargo Securities, LLC
Acting as Representatives of the
several Underwriters named in
Schedule A to the Underwriting Agreement.
several Underwriters named in
Schedule A to the Underwriting Agreement.
By: Xxxxxxx Xxxxx & Company, L.L.C.
By: |
||||
Name:
|
||||
Title: |
By: Xxxxx Fargo Securities, LLC
By: |
||||
Name:
|
||||
Title: |
Signature page to Pricing Agreement
Schedule A to Pricing Agreement
Pricing Information
Pricing Information
| • | Total Shares Offered: 8,976,112 (with overallotment option: 1,346,417) | |
| • | Price to Public: $22.25 | |
| • | Underwriting Discount: $0.89 | |
| • | Expected Settlement Date: June 16, 2010 |
