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EXHIBIT 1.1
STAFFMARK, INC.
3,500,000 SHARES OF COMMON STOCK
UNDERWRITING AGREEMENT
August ___, 1997
X.X. XXXXXXXX & CO.
XXXXXXXXXX SECURITIES
XXXXXXXX INC.
As Representatives of the several Underwriters
c/o X.X. Xxxxxxxx & Co.
X.X. Xxxxxxxx Financial Center
000 Xxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
Ladies and Gentlemen:
StaffMark, Inc., a Delaware corporation (the "Company"),
proposes to sell to the several underwriters named in Schedule I hereto (the
"Underwriters") for whom you are acting as the representatives (the
"Representatives") with respect to the sale by the Company of 3,215,000 shares
(the "Company Shares") of the Company's common stock, par value $0.01 per share
(the "Common Stock"), and the stockholders of the Company named in Schedule II
hereto (the "Selling Stockholders") propose to sell to the Underwriters 285,000
shares of the Common Stock (the "Selling Stockholder Shares"). The Company
Shares and the Selling Stockholder Shares are hereinafter referred to
collectively as the "Firm Shares." The Company has also agreed to grant to you
an option (the "Option") to purchase up to a total of 525,000 additional shares
of Common Stock (the "Option Shares") on the terms and for the purposes set
forth in Section 1(b) hereof. The Firm Shares and the Option Shares are
hereinafter collectively referred to as the "Shares."
The Company and the Selling Stockholders confirm as follows
their agreements with you.
1. AGREEMENT TO SELL AND PURCHASE; PUBLIC OFFERING.
(a) On the basis of the representations, warranties and
covenants herein contained, and subject to all the terms and conditions of this
Agreement, the Company agrees to sell to the Underwriters an aggregate of
3,215,000 Firm Shares, and each of the Selling Stockholders agrees, severally
and not jointly, to sell to the Underwriters the aggregate number of Firm
Shares set forth opposite such Selling Stockholder's name in Schedule II
hereto, and each of the Underwriters, severally and not jointly, agrees to
purchase at the purchase price of $_______ per share, the number of Firm Shares
set forth opposite such Underwriter's name in Schedule I hereto.
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(b) Subject to all the terms and conditions of this
Agreement, the Company also grants the Underwriters an Option to purchase,
severally and not jointly, up to 525,000 Option Shares from the Company, each
at the same price per share as you shall pay for the Firm Shares. The Option
may be exercised only to cover over-allotments in the sale of the Firm Shares
and may be exercised in whole or in part at any time (but not more than once)
on or before the 30th day after the date of the Prospectus (as defined below)
upon written or telegraphic notice (the "Option Shares Notice") by you to the
Company no later than 12:00 noon, Nashville, Tennessee time at least two and no
more than 10 business days before the date and time specified for closing in
the Option Shares Notice (the "Option Closing Date") setting forth the
aggregate number of Option Shares to be purchased. On the Option Closing Date,
the Company will issue and sell to the Underwriters the number of Option Shares
set forth in the Option Shares Notice, and unless otherwise adjusted by the
Representatives, each of the Underwriters will purchase such percentage of the
Option Shares as is equal to the percentage of Firm Shares that such
Underwriter is purchasing.
(c) After the Registration Statement becomes effective,
upon the authorization by you of the release of the Shares, the several
Underwriters propose to offer the Firm Shares and the Option Shares purchased
by the Underwriters for sale initially at the price per share set forth in the
Prospectus (the initial offering price) and upon the terms set forth therein.
2. DELIVERY AND PAYMENT.
Delivery of the Firm Shares shall be made to you by or on
behalf of the Company and the Selling Stockholders against payment of the
purchase price by federal funds wire transfer payable in same day funds to the
order of the Company at the offices of X.X. Xxxxxxxx & Co., X.X. Xxxxxxxx
Financial Center, 000 Xxxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxxx 00000, or at such
other place as may be agreed upon by the Representatives and the Company, at
10:00 a.m., Nashville time, on the third full business day following the date
of this Agreement (the "Closing Date"), or at such other time on such date, or
at such other place, as may be agreed upon by the Company and the
Representatives.
To the extent the Option is exercised, delivery of the Option
Shares against payment therefor (in the manner specified above) will take place
at the offices specified above at the Option Closing Date (which, subject to
the requirements set forth above for the Option Shares Notice, may be the
Closing Date).
Certificates evidencing the Shares shall be in definitive form
and shall be registered in such names and in such denominations as you shall
request not less than 48 hours prior to the Closing Date or the Option Closing
Date, as the case may be, by written notice to the Company. For the purpose of
expediting the checking and packaging of certificates for the Shares, the
Company agrees to make such certificates available for inspection at least 24
hours prior to the Closing Date or the Option Closing Date, as the case may be,
at a location to be designated by you, which may be in New York, New York, or
elsewhere.
The cost of original issue tax stamps, if any, in connection
with the issuance and delivery of the Firm Shares and Option Shares by the
Company to the Underwriters shall be
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borne by the Company. The Company will pay and save each of the Underwriters
and any subsequent holder of the Shares harmless from any and all liabilities
with respect to or resulting from any failure or delay in paying federal and
state stamp and other transfer taxes, if any, which may be payable or
determined to be payable in connection with the original issuance or sale to
such Underwriter of the Firm Shares and Option Shares.
3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
The Company represents, warrants and covenants to each of the
Underwriters that:
(a) The Company has prepared and has filed with the
Securities and Exchange Commission (the "Commission") a registration statement
(Registration No. 333-32371) on Form S-1 relating to the Shares, including a
preliminary prospectus and such amendments to such registration statement as
may have been required to the date of this Agreement, under the provisions of
the Securities Act of 1933, as amended (the "Act"), and the rules and
regulations (collectively referred to as the "Rules and Regulations") of the
Commission thereunder. The term "preliminary prospectus" as used herein means
a preliminary prospectus as contemplated by Rule 430 or Rule 430A of the Rules
and Regulations included at any time as part of the registration statement.
Copies of such registration statement and amendments and of each related
preliminary prospectus have been delivered to you. If such registration
statement has not become effective, a further amendment to such registration
statement, including a form of final prospectus, necessary to permit such
registration statement to become effective, will be filed promptly by the
Company with the Commission. If such registration statement has become
effective, a final prospectus containing information permitted to be omitted at
the time of effectiveness by Rule 430A of the Rules and Regulations will be
filed promptly by the Company with the Commission in accordance with Rule
424(b) of the Rules and Regulations. The term "Registration Statement" means
the registration statement as amended at the time it becomes or became
effective (the "Effective Date"), including financial statements and all
exhibits and any information deemed to be included by Rule 430A. The term
"Prospectus" means the prospectus as first filed with the Commission pursuant
to Rule 424(b) of the Rules and Regulations or, if no such filing is required,
the form of final prospectus included in the Registration Statement at the
Effective Date.
(b) On the Effective Date, the date the Prospectus is
first filed with the Commission pursuant to Rule 424(b) (if required), at all
times subsequent thereto up to and including the Closing Date and, if later,
the Option Closing Date and when any post-effective amendment to the
Registration Statement becomes effective or any amendment or supplement to the
Prospectus is filed with the Commission, the Registration Statement and the
Prospectus (as amended or as supplemented if the Company shall have filed with
the Commission any amendment or supplement thereto), including the financial
statements included in the Prospectus, did or will comply with all applicable
provisions of the Act and the Rules and Regulations and did or will contain all
statements required to be stated therein in accordance with the Act and the
Rules and Regulations. On the Effective Date and when any post-effective
amendment to the Registration Statement becomes effective, no part of the
Registration Statement, the Prospectus or any such amendment or supplement did
or will contain an untrue statement of a
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material fact or omit to state a material fact required to be stated therein or
necessary in order to make the statements therein not misleading. At the
Effective Date, the date the Prospectus or any amendment or supplement to the
Prospectus is filed with the Commission and at the Closing Date and, if later,
the Option Closing Date, the Prospectus did not or will not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements therein, in light of the circumstances under which they were
made, not misleading. The foregoing representations and warranties in this
Section 3(b) do not apply to any statements or omissions made in reliance on
and in conformity with information relating to the Underwriters furnished in
writing to the Company by the Representatives specifically for inclusion in the
Registration Statement or Prospectus or any amendment or supplement thereto.
The Company acknowledges that the statements set forth under the heading
"Underwriting" in the Prospectus constitute the only information relating to
the Underwriters furnished in writing to the Company by the Representatives
specifically for inclusion in the Registration Statement.
(c) The only active subsidiaries (as defined in the Rules
and Regulations) of the Company and all trade names or other fictitious names
used by the Company or such subsidiaries are as provided in Exhibit 21.1 of the
Registration Statement (individually, a "Subsidiary" and collectively, the
"Subsidiaries"). The Company and each of its Subsidiaries is, and at the
Closing Date will be, a corporation duly organized, validly existing and in
good standing under the laws of the jurisdiction of their incorporation. The
Company and each of its Subsidiaries has, and at the Closing Date will have,
full power and authority to conduct all the activities conducted by it, to own
or lease all the assets owned or leased by it and to conduct its business as
described in the Registration Statement and the Prospectus. The Company and
each Subsidiary is, and at the Closing Date will be, duly licensed or qualified
to do business and in good standing as a foreign corporation in all
jurisdictions in which the nature of the activities conducted by it or the
character of the assets owned or leased by it makes such licensing or
qualification necessary. Except for the stock of the Subsidiaries or as
disclosed in the Registration Statement, the Company does not own, and at the
Closing Date will not own, directly or indirectly, any shares of stock or any
other equity or long-term debt securities of any corporation or have any equity
interest in any firm, partnership, joint venture, association or other entity.
Complete and correct copies of the Certificate of Incorporation and the Bylaws
of the Company and each Subsidiary and all amendments thereto have been
delivered to you, and no changes therein will be made subsequent to the date
hereof and prior to the Closing Date or, if later, the Option Closing Date.
(d) The outstanding shares of the Company's Common Stock
have been, and the Shares to be issued and sold by the Company upon such
issuance will be, duly authorized, validly issued, fully paid and nonassessable
and will not be subject to any preemptive or similar right. The description of
the Common Stock in the Registration Statement and the Prospectus is, and at
the Closing Date will be, complete and accurate in all respects. Except as set
forth in the Prospectus, the Company does not have outstanding, and at the
Closing Date will not have outstanding, any options to purchase, or any rights
or warrants to subscribe for, or any securities or obligations convertible
into, or any contracts or commitments to issue or sell any shares of Common
Stock or any such warrants, convertible securities or obligations.
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(e) The financial statements and schedules included in
the Registration Statement or the Prospectus present fairly the consolidated
financial condition of the Company as of the respective dates thereof and the
consolidated results of operations and cash flows of the Company for the
respective periods covered thereby, all in conformity with generally accepted
accounting principles applied on a consistent basis throughout the entire
period involved, except as otherwise disclosed in the Prospectus. The
financial and statistical data set forth in the Prospectus under the captions
"Prospectus Summary," "Summary Financial Data," "Use of Proceeds,"
"Capitalization," "Selected Financial Data," "Management's Discussion and
Analysis of Financial Condition and Results of Operations," "Business,"
"Management" and "Principal and Selling Stockholders" and the financial
statements contained in the Prospectus fairly present the information set forth
therein on the basis stated in the Prospectus. No other financial statements
or schedules of the Company are required by the Act, the Exchange Act (as
hereinafter defined) or the Rules and Regulations to be included in the
Registration Statement or the Prospectus. Xxxxxx Xxxxxxxx LLP (the
"Accountants"), who have reported on such financial statements and schedules,
are independent auditors with respect to the Company as required by the Act and
the Rules and Regulations.
(f) The Company's system of internal accounting controls
taken as a whole is sufficient to meet the broad objectives of internal
accounting control insofar as those objectives pertain to the prevention or
detection of errors or irregularities in amounts that would be material in
relation to the Company's financial statements; and, except as disclosed in the
Prospectus, neither the Company nor any employee or agent of the Company has
made any payment of funds of the Company or received or retained any funds in
violation of any law, rule or regulation, the receipt or payment of which could
have a material adverse effect on the Company.
(g) Subsequent to the respective dates as of which
information is given in the Registration Statement and the Prospectus and prior
to the Closing Date, except as set forth in the Registration Statement and the
Prospectus, (i) there has not been and will not have been any material adverse
change in the business, properties, business prospects, condition (financial or
otherwise) or results of operations of the Company, arising for any reason
whatsoever, (ii) the Company has not incurred nor will it incur any material
liabilities or obligations, direct or contingent, except in the ordinary course
of business, (iii) the Company has not and will not have paid or declared any
dividends or other distributions of any kind on any class of its capital stock,
and (iv) there has not been and will not have been any change in the
capitalization of the Company other than pursuant to the exercise of employee
stock options.
(h) The Company is not an "investment company" or an
"affiliated person" of, or "promoter" or "principal underwriter" for, an
"investment company," as such terms are defined in the Investment Company Act
of 1940, as amended.
(i) Except as set forth in the Registration Statement and
the Prospectus, there are no actions, suits or proceedings pending or
threatened against or affecting the Company or any Subsidiary or any of
respective officers in their capacity as such, before or by any federal or
state court, commission, regulatory body, administrative agency or other
governmental body, domestic or foreign, wherein an unfavorable ruling, decision
or finding would materially and
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adversely affect the Company or its Subsidiaries or its business, properties,
business prospects, condition (financial or otherwise) or results of operations
or prevent or materially hinder the consummation of this Agreement.
(j) The Company and each Subsidiary has, and at the
Closing Date will have, (i) all governmental licenses, permits, consents,
orders, approvals and other authorizations necessary to carry on its business
as contemplated in the Prospectus, (ii) complied in all material respects with
all laws, regulations and orders applicable to it or its business and (iii)
performed all obligations required to be performed by it, and is not, and at
the Closing Date will not be, in default, under any contract or other
instrument material to it to which it is a party or by which its property is
bound or affected; the lack of which would materially and adversely affect the
Company or its Subsidiaries or its business, properties, business prospects,
condition (financial or otherwise) or results of operations or prevent or
materially hinder the consummation of this Agreement. To the best knowledge of
the Company and each Subsidiary, no other party under any contract or other
instrument to which it is a party is in default in any respect thereunder.
Neither the Company nor any Subsidiary is, nor at the Closing Date will any of
them be, in violation of any provision of its Certificate of Incorporation.
(k) No consent, approval, authorization or order of, or
any filing or declaration with, any court or governmental agency or body is
required for the consummation by the Company of the transactions on its part
herein contemplated, except such as have been obtained under the Act or the
Rules and Regulations and such as may be required under state securities or
Blue Sky laws or the bylaws and rules of the National Association of Securities
Dealers, Inc. (the "NASD") in connection with the purchase and distribution by
the Underwriters of the Shares.
(l) The Company has full corporate power and authority to
enter into this Agreement. This Agreement has been duly authorized, executed
and delivered by the Company and constitutes a valid and binding agreement of
the Company and is enforceable against the Company in accordance with the terms
hereof. The performance of this Agreement and the consummation of the
transactions contemplated hereby will not result in the creation or imposition
of any material lien, charge or encumbrance upon any of the assets of the
Company or any Subsidiary pursuant to the terms or provisions of, or result in
a breach or violation of any of the terms or provisions of, or constitute a
default under, or give any other party a right to terminate any of its
obligations under, or result in the acceleration of any obligation under, the
Certificate of Incorporation or Bylaws of the Company or its Subsidiaries, any
indenture, mortgage, deed of trust, voting trust agreement, loan agreement,
bond, debenture, note agreement or other evidence of indebtedness, lease,
contract or other agreement or instrument to which the Company or any
Subsidiary is a party or by which the Company or any Subsidiary or any of its
or their properties are bound or affected, or violate or conflict with any
judgment, ruling, decree, order, statute, rule or regulation of any court or
other governmental agency or body applicable to the business or properties of
the Company or any Subsidiary; the occurrence of which would materially and
adversely affect the Company or its Subsidiaries or its business, properties,
business prospects, condition (financial or otherwise) or results of operations
or prevent or materially hinder the consummation of this Agreement.
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(m) The Company and each Subsidiary has good and
marketable title to all properties and assets described in the Prospectus as
owned by it, free and clear of all liens, charges, encumbrances or
restrictions, except such as are described in the Prospectus or are not
material to the business of the Company or its Subsidiaries. The Company and
each Subsidiary has valid, subsisting and enforceable leases for the properties
described in the Prospectus as leased by it, with such exceptions as are not
material and do not materially interfere with the use made and proposed to be
made of such properties by the Company and such Subsidiaries. The Company and
each Subsidiary owns or leases all such properties as are necessary to its
operations as now conducted.
(n) There is no document or contract of a character
required to be described in the Registration Statement or the Prospectus or to
be filed as an exhibit to the Registration Statement that is not described or
filed as required. All such contracts to which the Company or any Subsidiary
is a party have been duly authorized, executed and delivered by the Company or
such Subsidiary constitute valid and binding agreements of the Company or such
Subsidiary and are enforceable against the Company or such Subsidiary in
accordance with the terms thereof, except where the lack of authorization,
execution, delivery or enforceability of any such contract would not materially
and adversely affect the Company or its Subsidiaries or its business,
properties, business prospects, condition (financial or otherwise) or results
of operations or prevent or materially hinder the consummation of this
Agreement.
(o) No statement, representation, warranty or covenant
made by the Company in this Agreement or made in any certificate or document
required by this Agreement to be delivered to you was or will be, when made,
inaccurate, untrue or incorrect in any material respect.
(p) Neither the Company nor any of its directors,
officers or controlling persons has taken, directly or indirectly, any action
designed, or which might reasonably be expected, to cause or result, under the
Act or otherwise, in, or which has constituted, stabilization or manipulation
of the price of any security of the Company to facilitate the sale or resale of
the Shares or the Common Stock.
(q) No holder of securities of the Company has rights to
the registration of any securities of the Company because of the filing of the
Registration Statement, except as disclosed in the Prospectus.
(r) The Company has taken such action as necessary to
have the Shares authorized for trading and all of the Shares have been approved
for listing on the National Association of Securities Dealers Automated
Quotation National Market System (the "Nasdaq National Market").
(s) Other than as contemplated by this Agreement, there
is no broker, finder or other party that is entitled to receive from the
Company any brokerage or finder's fee or other fee or commission as a result of
any of the transactions contemplated by this Agreement.
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(t) The Company has timely filed all required forms,
reports and other documents with the Commission all of which complied, when
filed, in all material respects, with all applicable requirements of the Act
and the Securities Exchange Act of 1934, as amended (the "Exchange Act"). As
of their respective dates, such reports, forms and other documents (including
all exhibits and schedules thereto) and documents incorporated by reference
therein (the "Reports"), did not contain any untrue statement of a material
fact required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading. The
Company has delivered a complete copy of all such Reports to the
Representatives prior to the date of this Agreement. The financial statements
of the Company included or incorporated by reference in such Reports, forms and
other documents were prepared in accordance with generally accepted accounting
principles applied on a consistent basis during the periods involved (except as
may otherwise be indicated in the notes thereto), and fairly present the
financial position of the Company as of the date thereof and the consolidated
results of its operations and consolidated changes in financial position for
the periods then ended (subject, in the case of any unaudited interim financial
statements, to year-end adjustments).
(u) The representations and warranties made by the
Company and its Subsidiaries in that certain Credit Agreement dated as of
October 4, 1996 by and between the Company, Mercantile Bank of St. Louis
National Association and the lenders party thereto, as amended (the "Credit
Agreement") were true, correct and complete when and as made and continue to be
true, correct and complete as of the date of this Agreement as if set forth in
their entirety herein. The Company is in compliance with all covenants of the
Company and is not in default or breach of any of the terms and provisions set
forth in the Credit Agreement and, after giving effect to the Offering, the
Company will continue to be in compliance with the covenants, terms and
provisions of the Credit Agreement.
4. REPRESENTATIONS AND WARRANTIES OF THE SELLING
STOCKHOLDERS.
Each of the Selling Stockholders, severally and not jointly,
represents, warrants and covenants to each Underwriter that:
(a) Such Selling Stockholder at the Closing Date will
have good and valid title to the Shares set forth in Schedule II to be sold by
such Selling Stockholder, free and clear of any liens, encumbrances, equities
and claims (other than as imposed by the Act or this Agreement), and full
right, power and authority to effect the sale and delivery of such Shares; and
upon the delivery of and payment for the Shares to be sold by such Selling
Stockholder pursuant to this Agreement, good and valid title thereto, free and
clear of any liens, encumbrances, equities and claims, will be transferred to
the Underwriters.
(b) Such Selling Stockholder has duly executed and
delivered the Selling Stockholders' Custody Agreement (the "Custody Agreement")
and the Selling Stockholders' Power of Attorney (the "Power of Attorney") in
the forms previously delivered to the Representatives, appointing Xxxxx X.
Xxxxxx, Xxxxx X. Xxxxxxx and Xxxxxx X. Xxxxxxx, and each of them as such
Selling Stockholder's attorney-in-fact (the "Attorney-in-Fact") and First
Chicago Trust Company of New York, as custodian (the "Custodian"). The
Attorney-in-Fact is
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authorized to execute, deliver and perform this Agreement on behalf of such
Selling Stockholder, to deliver the Shares to be sold by such Selling
Stockholder hereunder, to accept payment therefor and otherwise to act on
behalf of such Selling Stockholder in connection with this Agreement.
Certificates, in suitable form for transfer by delivery or accompanied by duly
executed instruments of transfer or assignment in blank, representing the
Shares to be sold by such Selling Stockholder hereunder have been deposited
with the Custodian pursuant to the Custody Agreement for the purpose of
delivery pursuant to this Agreement. Such Selling Stockholder agrees that the
shares of Common Stock represented by the certificates on deposit with the
Custodian are subject to the interest of the Underwriters hereunder, that the
arrangements made for such custody and the appointment of the Attorney-in-Fact
are to that extent irrevocable, and that the obligations of such Selling
Stockholder hereunder shall not be terminated except as provided in this
Agreement and the Custody Agreement. If such Selling Stockholder should die,
become disabled or be declared incompetent, dissolve or become insolvent, or if
any other event should occur before the delivery of the Shares of such Selling
Stockholder hereunder, the certificates for such Shares deposited with the
Custodian shall be delivered by the Custodian in accordance with the terms and
conditions of this Agreement as if such death, disability, incompetency,
dissolution, insolvency or other event had not occurred, regardless of whether
or not the Custodian or the Attorney-in-Fact shall have received notice
thereof.
(c) Such Selling Stockholder, acting through its duly
authorized Attorney-in-Fact, has duly executed and delivered this Agreement,
the Custody Agreement and the Power of Attorney; this Agreement constitutes a
legal valid and binding obligation of such Selling Stockholder; all
authorizations and consents necessary for the execution and delivery of this
Agreement, the Custody Agreement and the Power of Attorney on behalf of such
Selling Stockholder and for the sale and delivery of the Shares to be sold by
such Selling Stockholder hereunder have been given, except as may be required
by the Act or state securities laws or the NASD; and such Selling Stockholder
has the legal capacity and full right, power and authority to execute this
Agreement, the Custody Agreement and the Power of Attorney.
(d) The performance of this Agreement, the Custody
Agreement and the Power of Attorney and the consummation of the transactions
contemplated hereby and thereby by each of the Selling Stockholders will not
result in a material breach or violation of, or material conflict with, any of
the terms or provisions of, or constitute a material default by such Selling
Stockholder under, any indenture, mortgage, deed of trust (constructive or
other), loan agreement, lease, franchise, license or other agreement or
instrument to which such Selling Stockholder or any of its properties is bound,
any statute, or any judgment, decree, order, rule or regulation or any court or
governmental agency or body applicable to such Selling Stockholder or any of
its properties.
(e) Such Selling Stockholder has not distributed and will
not distribute any prospectus or other offering material in connection with the
offer and sale of the Shares other than any preliminary prospectus prepared and
filed by the Company with the Commission or the Prospectus or other material
permitted by the Act.
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(f) For a period of 180 days from the Effective Date of
the Registration Statement, such Selling Stockholder will not, directly or
indirectly, sell, offer to sell, grant any option for the sale of, or otherwise
dispose of any shares of Common Stock, other than to the Underwriters pursuant
to this Agreement, without the prior written consent of X.X. Xxxxxxxx & Co.;
provided, however, that the undersigned may give or pledge any such securities
without the prior written consent of X.X. Xxxxxxxx & Co. if the donee or
pledgee, as the case may be, agrees in writing prior to such gift or pledge to
be bound by the terms of this agreement and such writing is delivered to X.X.
Xxxxxxxx & Co. within five days after said gift or pledge; and provided
further, that the "Other Founding Stockholders" and the "Stockholder
Affiliates" (as those terms are defined in the "Shares Eligible For Future
Sale" section of the Prospectus) may sell, subject to all applicable federal
and state securities laws, a limited portion of their shares of Common Stock
without the prior written consent of X.X. Xxxxxxxx & Co. during the "Open
Period" (as defined in "Shares Eligible for Future Sale").
(g) Except to the knowledge of such Selling Stockholder,
the representations and warranties of the Company contained in Section 3 of
this Agreement are true and correct; such Selling Stockholder has reviewed and
is familiar with the Registration Statement as originally filed with the
Commission and the preliminary prospectus contained therein. To the knowledge
of such Selling Stockholder, the preliminary prospectus does not include an
untrue statement of a material fact, or omit to state a material fact necessary
in order to make the statements therein, in the light of the circumstances
under which they were made, not misleading; other than as disclosed to the
Underwriters, such Selling Stockholder is not prompted to sell the Shares to be
sold by such Selling Stockholder by any information concerning the Company that
is not set forth in the preliminary prospectus or the Prospectus.
(h) To the extent that any statements or omissions made
in the Registration Statement, any preliminary prospectus, the Prospectus or
any amendment or supplement thereto are made in reliance upon and in conformity
with written information furnished to the Company by such Selling Stockholder
expressly for use therein, such Registration Statement, preliminary prospectus
and Prospectus and any amendments or supplements thereto did not and will not
contain any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements therein
not misleading.
(i) No approval, consent, order, authorization,
designation, declaration or filing by or with any regulatory body,
administrative or other governmental body is necessary in connection with the
execution and delivery of this Agreement by such Selling Stockholder, and the
consummation by it of the transaction herein contemplated (other than as
required by the Act, state securities laws and the NASD).
(j) Any certificates signed by or on behalf of such
Selling Stockholder as such and delivered to the Representatives or to counsel
for the Representatives shall be deemed a representation and warranty by such
Selling Stockholder to each Underwriter as to the matters covered thereby.
(k) In order to document the Underwriters' compliance
with the reporting and withholding provisions of the Tax Equity and Fiscal
Responsibility Act of 1982 with respect to
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the transactions herein contemplated such Selling Stockholder agrees to deliver
to you prior to or at the Closing Date a properly completed and executed United
States Treasury Department Form W-9 (or other applicable form or statement
specified by Treasury Department regulations in lieu thereof).
(l) Such Selling Stockholder will not take, directly or
indirectly, any action designed to cause or result in, or which might
constitute or reasonably be expected to constitute, stabilization or
manipulation of the price of the Common Stock.
5. COVENANTS OF THE COMPANY.
The Company covenants and agrees with each of the Underwriters
as follows:
(a) The Company will not, either prior to the Effective
Date or thereafter during such period as the Prospectus is required by law to
be delivered in connection with sales of the Shares by an underwriter or
dealer, file any amendment or supplement to the Registration Statement or the
Prospectus, unless a copy thereof shall first have been submitted to you within
a reasonable period of time prior to the filing thereof and you shall not have
objected thereto in good faith.
(b) The Company will use its best efforts to cause the
Registration Statement to become effective, and will notify you promptly, and
will confirm such advice in writing, (i) when the Registration Statement has
become effective and when any post-effective amendment thereto becomes
effective, (ii) of any request by the Commission for amendments or supplements
to the Registration Statement or the Prospectus or for additional information,
(iii) of the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or the initiation of any
proceedings for that purpose or the threat thereof, (iv) of the happening of
any event during the period mentioned in the second sentence of Section 5(e)
that in the judgment of the Company makes any statement made in the
Registration Statement or the Prospectus untrue or that requires the making of
any changes in the Registration Statement or the Prospectus in order to make
the statements therein, in light of the circumstances in which they are made,
not misleading, and (v) of receipt by the Company or any representatives or
attorney of the Company of any other communication from the Commission relating
to the Company, the Registration Statement, any preliminary prospectus or the
Prospectus. If at any time the Commission shall issue any order suspending the
effectiveness of the Registration Statement, the Company will make every
reasonable effort to obtain the withdrawal of such order at the earliest
possible moment. If the Company has omitted any information from the
Registration Statement pursuant to Rule 430A of the Rules and Regulations, the
Company will use its best efforts to comply with the provisions of and make all
requisite filings with the Commission pursuant to said Rule 430A and to notify
the Representatives promptly of all such filings.
(c) The Company will furnish to you, without charge,
three signed copies of the Registration Statement and of any post-effective
amendment thereto, including financial statements and schedules, and all
exhibits thereto.
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(d) The Company will comply with all the provisions of
any undertakings contained in the Registration Statement. The Company will,
from time to time, after the effective date of the Registration Statement file
with the Commission such reports as are required by the Act, the Exchange Act,
the rules and regulations thereunder (the "Exchange Act Rules and Regulations")
and the Rules and Regulations, and shall also file with state securities
commissions in states where the Shares have been sold by you (as you shall have
advised us in writing) such reports as are required to be filed by the
securities acts and the regulations of those states.
(e) On the Effective Date, and thereafter from time to
time until expiration of the period mentioned in the second sentence of this
Section 5(e), the Company will deliver to each of you, without charge, as many
copies of the Prospectus or any amendment or supplement thereto as you may
reasonably request. The Company consents to the use of the Prospectus or any
amendment or supplement thereto by you and by all dealers to whom the Shares
may be sold, both in connection with the offering or sale of the Shares and for
any period of time thereafter during which the Prospectus is required by law to
be delivered in connection therewith. If during such period of time any event
shall occur which in the judgment of the Company or your counsel should be set
forth in the Prospectus in order to make any statement therein, in light of the
circumstances under which it was made, not misleading, or if it is necessary to
supplement or amend the Prospectus to comply with law, the Company will
forthwith prepare and duly file with the Commission an appropriate supplement
or amendment thereto, and will deliver to each of you, without charge, such
number of copies thereof as you may reasonably request.
(f) Prior to any public offering of the Shares by you,
the Company will cooperate with you and your counsel in connection with the
registration or qualification of the Shares for offer and sale under the
securities or Blue Sky laws of such jurisdictions as you may request; provided,
that in no event shall the Company be obligated to qualify to do business in
any jurisdiction where it is not now so qualified or to take any action which
would subject it to general service of process in any jurisdiction where it is
not now so subject.
(g) During the period of three years commencing on the
Effective Date, the Company will furnish to the Representatives copies of such
financial statements and other periodic and special reports as the Company may
from time to time distribute generally to the holders of any class of its
capital stock, and will furnish to you a copy of each annual or other report it
shall be required to file with the Commission promptly after such filing.
During such period, the Company will promptly notify you in writing if it
appears to the Company that it is likely that the Company will not in a timely
manner furnish to its stockholders an annual report containing audited
financial statements or a quarterly report for one of the first three quarters
of the fiscal year containing unaudited financial information.
(h) The Company will make generally available to holders
of its securities as soon as may be practicable but in no event later than the
last day of the fifteenth full calendar month following the calendar quarter in
which the Effective Date falls, an earnings statement (which need not be
audited but shall be in reasonable detail) for a period of 12 months ended
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commencing after the Effective Date, and satisfying the provisions of Section
11(a) of the Act (including Rule 158 of the Rules and Regulations).
(i) Whether or not the transactions contemplated by this
Agreement are consummated or this Agreement is terminated, the Company will
pay, or reimburse if paid by the Underwriters, all costs and expenses incident
to the performance of the obligations of the Company under this Agreement,
including but not limited to costs and expenses of or relating to (i) the
preparation, printing, and filing of the Registration Statement and exhibits to
it, each preliminary prospectus, the Prospectus and any amendment or supplement
to the Registration Statement or the Prospectus, (ii) the preparation and
delivery of certificates representing the Shares, (iii) the printing of this
Agreement and other underwriting documents, including Underwriter's
Questionnaires, Underwriter's Powers of Attorney, Blue Sky Memorandum, Master
Agreement Among Underwriters and Master Selected Dealer Agreements, (iv)
furnishing (including costs of shipping and mailing) such copies of the
Registration Statement, the Prospectus and any preliminary prospectus, and all
amendments and supplements thereto, as may be requested for use in connection
with the offering and sale of the Shares by the Underwriters or by dealers to
whom Shares may be sold, (v) the quotation of the Shares on the Nasdaq National
Market, (vi) any filings required to be made by you with the NASD, and the
fees, disbursements and other charges of your counsel in connection therewith,
(vii) the registration or qualification of the Shares for offer and sale under
the securities or Blue Sky laws of such jurisdictions designated pursuant to
Section 5(f), including the fees, disbursements and other charges of your
counsel in connection therewith, and the preparation and printing of
preliminary, supplemental and final Blue Sky memoranda (subject to a maximum
fee of $10,000, assuming no unusual circumstances), and (ix) the transfer agent
for the Shares.
(j) If this Agreement shall be terminated by the Company
or if for any reason the Company shall be unable to perform its obligations
hereunder, the Company will reimburse you for all out-of-pocket expenses
(including the fees, disbursements and other charges of your counsel)
reasonably incurred by them in connection herewith. If this Agreement shall be
terminated by the Underwriters based upon an Act of God or other circumstances
not involving a matter within the control of the Company or any fault of the
Company, the Company shall have no obligation to reimburse you for any
out-of-pocket expenses.
(k) The Company will not at any time, directly or
indirectly, take any action designed, or which might reasonably be expected, to
cause or result in, or which will constitute, stabilization of the price of the
shares of Common Stock to facilitate the sale or resale of any of the Shares.
(l) The Company will apply the net proceeds from the
offering and sale of the Shares to be sold by the Company in the manner set
forth in the Prospectus under "Use of Proceeds."
(m) During the period of 180 days commencing at the
Closing Date, the Company will not, without your prior written consent, grant
options to purchase shares of Common Stock except under stock option plans
previously approved by the Company's
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stockholders, and except at prices equal to or greater than "fair market
value", as defined in the Company's 1996 Stock Option Plan.
(n) The Company will not, and will cause each of its
executive officers, directors and each beneficial owner of one percent (1%) or
more of the outstanding shares of Common Stock (or options to acquire or become
the holder of one percent (1%) or more of the outstanding shares of Common
Stock) to enter into agreements with you to the effect that they will not, for
a period of 180 days after the commencement of the public offering of the
Shares, without your prior written consent (which shall not be unreasonably
withheld), sell, contract to sell or otherwise dispose of any shares of Common
Stock or rights to acquire such shares (other than pursuant to stock option
plans for employees or directors or in connection with other employee incentive
compensation arrangements and other than as otherwise set forth in such
agreements).
(o) If at any time during the 25 day period after the
Registration Statement is declared effective, any rumor, publication or event
relating to or affecting the Company shall occur as a result of which, in your
opinion, the market price for the Shares has been or is likely to be materially
affected (regardless of whether such rumor, publication or event necessitates a
supplement to or amendment of the Prospectus), the Company will, after written
notice from you advising it as to the effect set forth above, prepare, consult
with you concerning the substance of and disseminate a press release or other
public statement, reasonably satisfactory to you, responding to or commenting
on such rumor, publication or event.
6. CONDITIONS OF THE OBLIGATIONS OF THE UNDERWRITERS.
The respective obligations of the Underwriters to purchase and
pay for the Shares shall be subject, in their discretion, to the accuracy of
the representations and warranties of the Company herein as of the date hereof
and as of the Closing Date as if made on and as of the Closing Date, to the
accuracy of the statements of the Company's officers made pursuant to the
provisions hereof, to the performance by the Company of all of their covenants
and agreements hereunder and to the following additional conditions:
(a) Notification that the Registration Statement has
become effective shall be received by you not later than 5:30 p.m., Nashville,
Tennessee time, on the date of this Agreement or at such later date and time as
shall be consented to in writing by you and all filings required by Rule 424
and Rule 430A of the Rules and Regulations shall have been made.
(b) (i) No stop order suspending the effectiveness of
the Registration Statement shall have been issued and no proceedings for that
purpose shall be pending or threatened by the Commission, (ii) no order
suspending the effectiveness of the Registration Statement or the qualification
or registration of the Shares under the securities or Blue Sky laws of any
jurisdiction shall be in effect and no proceeding for such purpose shall be
pending before or threatened or contemplated by the Commission or the
authorities of any such jurisdiction, (iii) any request for additional
information on the part of the staff of the Commission or any such authorities
shall have been complied with to the satisfaction of the staff of the
Commission or such authorities and to the satisfaction of the Representatives,
(iv) after the date hereof no
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amendment or supplement to the Registration Statement or the Prospectus shall
have been filed unless a copy thereof was first submitted to you and you did
not object thereto in good faith, (v) the NASD, upon review of the terms of the
public offering of the Shares, shall not have objected to such offering, such
terms or the Underwriters' participation in the same, and (vi) and you shall
have received certificates, dated the Closing Date and the Option Closing Date
and signed by the Chief Executive Officer or the Chairman of the Board of
Directors of the Company and the Chief Financial Officer of the Company (who
may, as to proceedings threatened, rely upon the best of their information and
belief), to the effect of clauses (i), (ii) and (iii).
(c) Since the respective dates as of which information is
given in the Registration Statement and the Prospectus, (i) there shall not
have been a material adverse change, or any development involving a prospective
material adverse change, in the general affairs, business, business prospects,
properties, management, key personnel, condition (financial or otherwise) or
results of operations of the Company, whether or not arising from transactions
in the ordinary course of business, in each case other than as set forth in the
Registration Statement and the Prospectus (or, in the case of a prospective
change, other than as contemplated by the Registration Statement and the
Prospectus), and (ii) the Company shall not have sustained any material loss or
interference with its business or properties from fire, explosion, flood,
hurricane or other casualty or calamity, whether or not covered by insurance,
or from any labor dispute or any court or legislative or other governmental
action, order or decree, which is not set forth in the Registration Statement
and the Prospectus, if in your reasonable judgment any such development makes
it impracticable or inadvisable to consummate the sale and delivery of the
Shares by you at the public offering price.
(d) Since the respective dates as of which information is
given in the Registration Statement and the Prospectus, there shall have been
no litigation or other proceeding instituted against the Company or any of its
officers or directors in their capacities as such, before or by any federal,
state, or local court, commission, regulatory body, administrative agency or
other governmental body, domestic or foreign, in which litigation or proceeding
an unfavorable ruling, decision or finding would materially and adversely
affect the business, properties, business prospects, condition (financial or
otherwise) or results of operations of the Company.
(e) Each of the representations and warranties of the
Company contained herein shall be true and correct in all material respects at
the Closing Date and, with respect to the Option Shares, at the Option Closing
Date, as if made at the Closing Date and, with respect to the Option Shares, at
the Option Closing Date, and all covenants and agreements herein contained to
be performed on the part of the Company and all conditions herein contained to
be fulfilled or complied with by the Company at or prior to the Closing Date
and, with respect to the Option Shares, at or prior to the Option Closing Date,
shall have been duly performed, fulfilled or complied with.
(f) The Underwriters shall have received an opinion,
dated the Closing Date and, with respect to the Option Shares, the Option
Closing Date, and satisfactory in form and substance to your counsel, from
Xxxxxx, Xxxxxxx & Xxxxxxxx, counsel to the Company, to the effect that:
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(i) The Company has been duly incorporated and is
an existing corporation in good standing under the laws of the
State of Delaware, with corporate power and authority to own
its properties and conduct its business as described in the
Prospectus. The Company is qualified to do business as a
foreign corporation in good standing in all other
jurisdictions, except when the failure to so qualify would
have a material adverse effect upon the Company.
(ii) Each Subsidiary is a corporation duly
organized, validly existing and in good standing under the
laws of its state of incorporation or organization, as the
case may be; each Subsidiary has the corporate power and
authority to own its properties and conduct its business as
described in the Prospectus; and each Subsidiary is qualified
to do business as a foreign corporation in good standing in
all other jurisdictions, except when the failure to so qualify
would have a material adverse effect upon the Company and its
Subsidiaries taken as a whole.
(iii) As of the dates specified therein, the Company
had authorized and issued capital stock as set forth under the
caption "Capitalization" in the Prospectus. All the
outstanding shares of capital stock of each Subsidiary have
been duly and validly authorized and issued and are fully paid
and nonassessable. and except as otherwise set forth in the
Prospectus, all outstanding shares of capital stock of each of
the Subsidiaries (except directors' qualifying shares) are
owned by the Company free and clear of any perfected security
interest and any other security interests, claims, liens or
encumbrances.
(iv) The Shares delivered on such Closing Date have
been duly authorized, validly issued and are fully paid and
nonassessable, and conform to the description thereof
contained in the Prospectus.
(v) The outstanding shares of Common Stock have
been duly authorized and validly issued, are fully paid and
nonassessable and conform to the description thereof contained
in the Prospectus; and the stockholders of the Company have no
preemptive or similar rights with respect to the Shares or the
Common Stock. All offers and sales of the Company's
securities during the past three years were at all relevant
times duly registered or exempt from the registration
requirements of the Act and were duly registered or the
subject of an exemption from the registration requirements of
applicable state securities or Blue Sky laws.
(vi) Except as set forth in the Prospectus, there
are no contracts, agreements or understandings known to such
counsel between the Company and any person granting such
person the right to require the Company to file a registration
statement under the Act with respect to any securities of the
Company owned or to be owned by such person or to require the
Company to include such securities in the securities
registered pursuant to the Registration Statement or in any
securities being registered pursuant to any other registration
statement filed by the Company under the Act.
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(vii) No consent, approval, authorization or order
of, or filing with, any governmental agency or body or any
court is required for the issuance or sale of the Shares or
the consummation of the other transactions contemplated by
this Agreement, except such as have been obtained and made
under the Act, the Exchange Act and such as may be required
under state securities or Blue Sky laws.
(viii) The execution, delivery and performance of
this Agreement and the consummation of the transactions herein
contemplated, including the issuance and sale of the Shares
and compliance with the provisions thereof, will not result in
a breach or violation of any of the terms or provisions of, or
constitute a default under, (A) any statute, rule, regulation
or, to the knowledge of such counsel, order of any
governmental agency or body or any court having jurisdiction
over the Company or the Subsidiaries or any of their
properties, or (B) any material obligation, agreement,
covenant or condition contained in any agreement or instrument
to the knowledge of such counsel to which the Company or the
Subsidiaries is a party or by which the Company or the
Subsidiaries is bound or to which any of the properties of the
Company or the Subsidiaries is subject, or (C) the Certificate
of Incorporation as amended, of the Company, or the Bylaws of
the Company or the Articles of Incorporation or Bylaws of the
Subsidiaries, and the Company has full power and authority to
authorize, issue and sell the Shares as contemplated by this
Agreement.
(ix) The Registration Statement was declared
effective under the Act as of the date and time specified in
such opinion, the Prospectus either was filed with the
Commission pursuant to the subparagraph of Rule 424(b)
specified in such opinion on the date specified therein or was
included in the Registration Statement (as the case may be),
and, to the best of the knowledge of such counsel, no stop
order suspending the effectiveness of the Registration
Statement or any part thereof has been issued and no
proceedings for that purpose have been instituted or are
pending or contemplated under the Act; the Registration
Statement and the Prospectus, and each amendment or supplement
thereto, as of their respective effective or issue dates,
complied as to form in all material respects with the
requirements of the Act and the Rules and Regulations (except
that such counsel need express no opinion as to financial
statements, schedules and other financial or statistical
information included therein); the descriptions in the
Registration Statement and Prospectus of statutes, legal and
governmental proceedings and contracts and other documents are
accurate in all material respects and fairly present the
information required to be shown; and such counsel does not
know of any statutes or regulations or any pending or
threatened legal or governmental proceedings, required to be
described in the Prospectus which are not described as
required nor of any contracts or documents of a character
required to be described in the Registration Statement or the
Prospectus or to be filed as exhibits to the Registration
Statement which are not described and filed as required; it
being understood that such counsel need express no opinion as
to the financial statements, schedules or other financial or
statistical data contained
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in the Registration Statement or the Prospectus or as to the
section of the Prospectus entitled "Underwriting."
(x) This Agreement has been duly authorized,
executed and delivered by the Company and constitutes a valid
and legally binding obligation of the Company enforceable in
accordance with its terms, except (A) as such enforceability
may be limited by bankruptcy, insolvency, reorganization,
fraudulent conveyance or similar laws now or hereafter in
effect relating to creditors' rights or debtors' obligations
generally; (B) that the remedies of specific performance and
injunctive and other forms of relief are subject to general
equitable principles, whether enforcement is sought at law or
in equity, and that such enforcement may be subject to the
discretion of the court before which any proceedings therefor
may be brought; and (C) as rights to indemnity and
contribution may be limited by state or Federal laws relating
to securities or the policies underlying such laws.
Such opinion shall also contain a statement by counsel to the
effect that such counsel have no reason to believe that the Registration
Statement, or any amendment thereto, as of its effective date, contained any
untrue statement of a material fact or omitted to state any material fact
required to be stated therein or necessary to make the statements therein not
misleading, or that the Prospectus, or any supplement thereto, as of its issue
date, included any untrue statement of a material fact or omitted to state any
material fact necessary in order to make the statement of a material fact or
omitted to state any material fact necessary in order to make the statements,
in light of the circumstances under which they were made, not misleading.
In rendering such opinion, such counsel may rely as to matters
of fact, to the extent proper, on certificates of responsible officers of the
Company.
(g) The Underwriters shall have received an opinion,
dated the Closing Date and satisfactory in form and substance to your counsel,
from Xxxxxx, Xxxxxxx & Xxxxxxxx, counsel to the Selling Stockholders, to the
effect that:
(i) This Agreement, the Custody Agreement and the
Power of Attorney have been duly executed and delivered by or
on behalf of each of the Selling Stockholders and constitute
valid and binding agreements of such Selling Stockholders in
accordance with their terms, except as enforceability may be
limited by applicable equitable principles or by bankruptcy,
insolvency, moratorium, reorganization or similar laws from
time to time in effect affecting the enforcement of creditors'
rights and except that the enforceability of the rights to
indemnity and contribution contained herein may be limited by
federal or state laws and public policy underlying such laws.
(ii) To the knowledge of such counsel, the sale of
the Shares to be sold by each Selling Stockholder hereunder
and the compliance by such Selling Stockholder with all of the
provisions of this Agreement, the Custody Agreement and the
Power of Attorney and the consummation of the transactions
herein and
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therein contemplated will not conflict with or result in a
breach or violation of any terms or provisions of, or
constitute a default under any material indenture, mortgage,
deed of trust, loan agreement or other agreement or instrument
known to such counsel to which such Selling Stockholder is a
party or by which such Selling Stockholder is bound or to
which any of the property or assets of such Selling
Stockholder is subject, or any statute, order, rule or
regulation of any court or governmental agency or body known
to such counsel to be applicable to such Selling Stockholder
or the property of such Selling Stockholder.
(iii) To the knowledge of such counsel, no consent,
approval, authorization or order of any court or governmental
agency or body is required for the consummation of the
transactions contemplated by this Agreement in connection with
the Shares to be sold by each Selling Stockholder hereunder,
except which have been duly obtained and in full force and
effect, such as have been obtained under the Act and such as
may be required under state securities or Blue Sky laws in
connection with the purchase and distribution of such Shares
by the Underwriters, as to which such counsel need express no
opinion.
(iv) Assuming that the Underwriters will take
delivery of the Shares for value in good faith and without
notice of any adverse claim and that the Underwriters are not
parties themselves to any fraud or illegality affecting the
Shares, and by delivery of a certificate or certificates
therefor, the Selling Stockholders will transfer to the
Underwriters good and valid title to such shares, free and
clear of any pledge, lien, security interest, charge, claim,
equity, or encumbrance of any kind.
In rendering such opinion, such counsel may rely as to matters
of fact, to the extent proper, on certificates of the Selling Stockholders and
the representations and warranties contained in the Custody Agreement and Power
of Attorney executed by such Selling Stockholder. Such counsel also may rely
as to matters of fact, to the extent deemed proper, on certificates of
responsible officers of the Company and public officials.
(h) You shall have received an opinion, dated the Closing
Date and the Option Closing Date, from Xxxxxx Xxxxxxx Xxxxx & Scarborough,
L.L.P., as your counsel, with respect to the Registration Statement, the
Prospectus and this Agreement, which opinion shall be satisfactory in all
respects to you, and the Company shall have furnished to such counsel such
documents as they request for the purpose of enabling them to pass upon such
matters.
(i) The Representative shall have received from the
Accountants a letter dated the date hereof, and at the Closing Date a second
letter dated the Closing Date, in form and substance satisfactory to the
Representatives, stating that they are independent auditors with respect to the
Company within the meaning of the Act and the applicable Rules and Regulations,
and to the effect that:
(i) In their opinion, the financial statements
and schedules examined by them and included in the
Registration Statement comply as to form in all
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material respects with the applicable accounting requirements
of the Act and the Rules and Regulations and are presented in
accordance with generally accepted accounting principles; and
they have made a review in accordance with standards
established by the American Institute of Certified Public
Accountants of the interim financial statements, selected
financial and operating data, and/or condensed financial
statements derived from audited financial statements of the
Company.
(ii) The financial information included in the
Preliminary Prospectus and the Prospectus under the captions
"Prospectus Summary" and "Selected Financial Data" for each of
the fiscal years ended December 31, 1992, 1993, 1994, 1995 and
1996 agrees with the corresponding amounts in the audited
financial statements included in the Prospectus or previously
reported on by them.
(iii) On the basis of a reading of the latest
available interim financial statements (unaudited) of the
Company, a reading of the minute books of the Company,
inquiries of officials of the Company responsible for
financial and accounting matters and other specified
procedures, all of which have been agreed to by the
Representatives, nothing came to their attention that caused
them to believe that:
a. the unaudited financial statements
included in the Registration Statement do not comply
as to form in all material respects with the
accounting requirements of the federal securities
laws and the related published rules and regulations
thereunder or are not in conformity with generally
accepted accounting principles applied on a basis
consistent with the basis for the audited financial
statements contained in the Registration Statement;
b. any other unaudited financial
statement data included in the Prospectus do not
agree with the corresponding items in the unaudited
consolidated financial statements from which data was
derived and any such unaudited data were not
determined on a basis consistent with the basis for
the corresponding amounts in the audited financial
statements included in the Prospectus;
c. at a specified date not more than
five days prior to the date of delivery of such
respective letter, there was any change in the
consolidated capital stock, decline in stockholders'
equity or increase in long-term debt of the Company,
or other items specified by the Underwriters, in each
case as compared with amounts shown in the latest
balance sheets included in the Prospectus, except in
each case for changes, decreases or increases which
the Prospectus discloses have occurred or may occur
or which are described in such letters; and
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d. for the period from the closing date
of the latest statements of income included in the
Prospectus to a specified date not more than five
days prior to the date of delivery of such respective
letter, there were any decreases in net revenues or
net income of the Company, or other items appearing
on the face of the statement of operations specified
by the Representatives, or any increases in any items
appearing on the face of the statement of operations
specified by the Representatives, in each case as
compared with the corresponding period of the
preceding year, except in each case for decreases
which the Prospectus discloses have occurred or may
occur or which are described in such letter.
(iv) They have carried out certain specified
procedures, not constituting an audit, with respect to certain
amounts, percentages and financial information specified by
you which are derived from the general accounting records of
the Company, which appear in the Prospectus and have compared
and agreed such amounts, percentages and financial information
with the accounting records of the Company.
In the event that the letters to be delivered referred to
above set forth any such changes, decreases or increases, it shall be a further
condition to the obligations of the Underwriters that the Underwriters shall
have reasonably determined, after discussions with officers of the Company
responsible for financial and accounting matters and with the Accountants, that
such changes, decreases or increases as are set forth in such letters do not
reflect a material adverse change in the stockholders' equity or long-term debt
of the Company as compared with the amounts shown in the latest balance sheet
of the Company included in the Prospectus, or a material adverse change in
total net revenues or net income of the Company, in each case as compared with
the corresponding period of the prior year.
(j) At the Closing Date and, as to the Option Shares, the
Option Closing Date, there shall be furnished to you a certificate, dated the
date of its delivery, signed by each of the Chief Executive Officer and Chief
Financial Officer of the Company, in form and substance satisfactory to you, to
the effect that:
(i) Each of the representations and warranties of
the Company contained in Section 3 of this Agreement were,
when originally made, and are, at the time such certificate is
delivered, true and correct in all material respects;
(ii) Each of the covenants required herein to be
performed by the Company on or prior to the delivery of such
certificate has been duly, timely and fully performed and each
condition herein required to be complied with by the Company
on or prior to the date of such certificate has been duly,
timely and fully complied with.
(k) On or prior to the Closing Date, you shall have
received the executed agreements referred to in Section 5(n).
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(l) The Shares shall be qualified for sale in such states
as you may reasonably request, each such qualification shall be in effect and
not subject to any stop order or other proceeding on the Closing Date or the
Option Closing Date.
(m) The Shares shall have been duly authorized for
quotation and shall have been approved for listing on the Nasdaq National
Market upon official notice of issuance.
(n) No Underwriter shall have advised the Company that
the Registration Statement, any preliminary prospectus, the Prospectus, or any
amendment or any supplement thereto, contains an untrue statement of fact
which, in your reasonable judgment, is material, or omits to state a fact
which, in your reasonable judgment, is material and is required to be stated
therein or necessary to make the statements therein not misleading and the
Company shall not have cured such untrue statement of fact or stated a
statement of fact required to be stated therein.
(o) The Company shall have furnished to you such
certificates, in addition to those specifically mentioned herein, as you may
have reasonably requested as to the accuracy and completeness at the Closing
Date and the Option Closing Date of any statement in the Registration Statement
or the Prospectus, as to the accuracy at the Closing Date and the Option
Closing Date of the representations and warranties of the Company herein, as to
the performance by the Company of its obligations hereunder, or as to the
fulfillment of the conditions concurrent and precedent to your obligations
hereunder.
(p) The Selling Stockholders or the Attorney-in-Fact
shall deliver to the Underwriters a certificate dated the Closing Date and
executed by each Selling Stockholder or the Attorney-in-Fact to the effect that
the representations and warranties of the Selling Stockholders shall be true
and correct as of the Closing Date.
7. INDEMNIFICATION AND CONTRIBUTION.
(a) The Company will indemnify and hold harmless each
Underwriter, the directors, officers, employees and agents of each Underwriter
and each person, if any, who controls each Underwriter within the meaning of
Section 15 of the Act or Section 20 of the Exchange Act, from and against any
and all losses, claims, liabilities, expenses and damages (including any and
all investigative, legal and other expenses reasonably incurred in connection
with,and any amount paid in settlement of, any action, suit or proceeding or
any claim asserted), to which they, or any of them, may become subject under
the Act, the Exchange Act or other Federal or state statutory law or
regulation, at common law or otherwise, insofar as such losses, claims,
liabilities, expenses or damages arise out of or are based in whole or in part
upon (i) any inaccuracy in the representations and warranties of the Company
contained herein, (ii) any failure of the Company to perform its obligations
hereunder or under law or (iii) any untrue statement or alleged untrue
statement of a material fact contained in any preliminary prospectus, the
Registration Statement or the Prospectus or any amendment or supplement to the
Registration Statement or the Prospectus or in any documents filed under the
Exchange Act or any blue sky application or filing, or the omission or alleged
omission to state in such document a material
22
23
fact required to be stated in it or necessary to make the statements in it not
misleading; provided, however, that the foregoing indemnity agreement with
respect to any preliminary prospectus or the Prospectus shall not inure to the
benefit of any Underwriter from whom the person asserting any such losses,
claims, damages or liabilities purchased Shares, or any person controlling such
Underwriter, if a copy of the Prospectus (as then amended or supplemented if
the Company shall have furnished any amendments or supplements thereto) was not
sent or given by or on behalf of such Underwriter to such person, if required
by law so to have been delivered, at or prior to the written confirmation of
the sale of the Shares to such person, and if the Prospectus (as so amended or
supplemented) would have cured the defect giving rise to such loss, claim,
damage or liability; and further provided, that the Company will not be liable
to the extent that such loss, claim, liability, expense or damage arises from
the sale of the Shares in the public offering to any person by an Underwriter
and is based on an untrue statement or omission or alleged untrue statement or
omission made in reliance on and in conformity with information relating to an
Underwriter furnished in writing to the Company by an Underwriter expressly for
inclusion in the Registration Statement, any preliminary prospectus or the
Prospectus. The Company acknowledges that the statements set forth under the
heading "Underwriting" in any preliminary prospectus and the Prospectus
constitute the only information relating to any Underwriter furnished in
writing to the Company by you expressly for inclusion in the Registration
Statement, any preliminary prospectus or the Prospectus. This indemnity
agreement will be in addition to any liability that the Company might otherwise
have.
(b) Each Selling Stockholder agrees, severally and not
jointly, to indemnify and hold harmless each Underwriter and each person, if
any, who controls any Underwriter within the meaning of either Section 15 of
the Act or Section 20 of the Exchange Act, and the Company, its directors, its
officers who sign the Registration Statement and each person, if any who
controls the Company within the meaning of either such Section, provided,
however, that the indemnification obligation of each Selling Stockholder shall
be limited to the aggregate public offering price of the Shares sold by such
Selling Stockholder, from and against any and all losses, claims, damages and
liabilities caused by any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement or the Prospectus (as
amended or supplemented if the Company shall have furnished any amendment or
supplement thereto) or any preliminary prospectus, or caused by any omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, but only with
reference to information relating to such Selling Stockholder furnished in
writing by or on behalf of such Selling Stockholder expressly for use in the
Registration Statement or the Prospectus or in any preliminary prospectus;
provided, however, that the foregoing indemnity agreement with respect to any
preliminary prospectus or the Prospectus shall not inure to the benefit of any
Underwriter from whom the person asserting any such losses, claims, damages or
liabilities purchased Shares, or any person controlling such Underwriter, if a
copy of the Prospectus (as then amended or supplemented if the Company shall
have furnished any amendments or supplements thereto) was not sent or given by
or on behalf of such Underwriter to such person, if required by law so to have
been delivered, at or prior to the written confirmation of the sale of the
Shares to such person, and if the Prospectus (as so amended or supplemented)
would have cured the defect giving rise to such loss, claim, damage or
liability.
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(c) Each Underwriter will indemnify and hold harmless the
Company, each Selling Stockholder, each person, if any, who controls the
Company within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act, each director of the Company and each officer of the Company who
signs the Registration Statement to the same extent as the foregoing indemnity
from the Company to the Underwriters, but only insofar as losses, claims,
liabilities, expenses or damages arise out of or are based on any untrue
statement or omission or alleged untrue statement or omission made in reliance
on and in conformity with information relating to you furnished in writing to
the Company by you expressly for use in the Registration Statement, any
preliminary prospectus or the Prospectus. The Company acknowledges that the
statements set forth under the heading "Underwriting" in any preliminary
prospectus and the Prospectus constitute the only information relating to the
Underwriters furnished in writing to the Company by the Underwriters expressly
for inclusion in the Registration Statement, any preliminary prospectus or the
Prospectus. This indemnity will be in addition to any liability that the
Underwriters might otherwise have.
(d) Any party that proposes to assert the right to be
indemnified under this Section 7 will, promptly after receipt of notice of
commencement of any action against such party in respect of which a claim is to
be made against an indemnifying party or parties under this Section 7, notify
each such indemnifying party of the commencement of such action, enclosing a
copy of all papers served, but the omission so to notify such indemnifying
party will not relieve it from any liability that it may have to any
indemnified party under the foregoing provisions of this Section 7 unless, and
only to the extent that, such omission results in the forfeiture of substantive
rights or defenses by the indemnifying party. If any such action is brought
against any indemnified party and it notifies the indemnifying party of its
commencement, the indemnifying party will be entitled to participate in and, to
the extent that it elects by delivering written notice to the indemnified party
promptly after receiving notice of the commencement of the action from the
indemnified party, jointly with any other indemnifying party similarly
notified, to assume the defense of the action, with counsel reasonably
satisfactory to the indemnified party, and after notice from the indemnifying
party to the indemnified party of its election to assume the defense, the
indemnifying party will not be liable to the indemnified party for any legal or
other expenses except as provided below and except for the reasonable costs of
investigation subsequently incurred by the indemnified party in connection with
the defense. The indemnified party will have the right to employ its own
counsel in any such action, but the fees, expenses and other charges of such
counsel will be at the expense of such indemnified party unless (i) the
employment of counsel by the indemnified party has been authorized in writing
by the indemnifying party, (ii) the indemnified party has reasonably concluded
(based on advice of counsel) that there may be legal defenses available to it
or other indemnified parties that are different from or in addition to those
available to the indemnifying party, (iii) a conflict of interests exists
(based on advice of counsel to the indemnified party) between the indemnified
party and the indemnifying party (in which case the indemnifying party will not
have the right to direct the defense of such action on behalf of the
indemnified party) or (iv) the indemnifying party has not in fact employed
counsel to assume the defense of such action within a reasonable time after
receiving notice of the commencement of the action, in each of which cases the
reasonable fees, disbursements and other charges of counsel will be at the
expense of the indemnifying party or parties. It is understood that the
indemnifying party or parties shall not, in connection with any proceeding or
related proceedings in the same
24
25
jurisdiction, be liable for the reasonable fees, disbursements and other
charges of more than one separate firm admitted to practice in such
jurisdiction at any one time for all such indemnified party or parties. All
such fees, disbursements and other charges will be reimbursed by the
indemnifying party promptly as they are incurred. An indemnifying party will
not be liable for any settlement of any action or claim effected without its
written consent (which consent will not be unreasonably withheld).
(e) In order to provide for just and equitable
contribution in circumstances in which the indemnification provided for in the
foregoing paragraphs of this Section 6 is applicable in accordance with its
terms but for any reason is held to be unavailable from the Company or the
Underwriters, then the Company and the Underwriters will contribute to the
total losses, claims, liabilities, expenses and damages (including any
investigative, legal and other expenses reasonably incurred in connection with,
and any amount paid in settlement of, any action, suit or proceeding or any
claim asserted, but after deducting any contribution received by the Company
from persons other than the Underwriters, such as persons who control the
Company within the meaning of the Act, officers of the Company who signed the
Registration Statement and directors of the Company, who may be liable for
contribution) to which the Company and the Underwriters may be subject in such
proportion as shall be appropriate to reflect the relative benefits received by
the Company and the Underwriters. The relative benefits received by the
Company and the Underwriters shall be deemed to be in the same respective
proportions as the total net proceeds from the offering (before deducting
expenses) received by the Company bears to the total underwriting discounts and
commissions received by the Underwriters, in each case as set forth in the
table on the cover page of the Prospectus. If, but only if, the allocation
provided by the foregoing sentence is not permitted by applicable law, the
allocation of contribution shall be made in such proportion as is appropriate
to reflect not only the relative benefits referred to in the foregoing sentence
but also the relative fault of the Company and the Underwriters with respect to
the statements or omissions which resulted in such loss, claim, liability,
expense or damage, or action in respect thereof, as well as any other relevant
equitable considerations with respect to such offering. Such relative fault
shall be determined by reference to whether the untrue or alleged untrue
statement of a material fact or omission or alleged omission to state a
material fact relates to information supplied by the Company or the
Underwriters, the intent of the parties and their relative knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The Company and the Underwriters agree that it would not be just and equitable
if contributions pursuant to this Section 7(d) were to be determined by pro
rata or per capita allocation (even if the Underwriters were treated as one
entity for such purpose) or by any other method of allocation which does not
take into account the equitable considerations referred to herein. The amount
paid or payable by an indemnified party as a result of the loss, claim,
liability, expense or damage, or action in respect thereof, referred to above
in this Section 7(d) shall be deemed to include, for purpose of this Section
7(d), any legal or other expenses reasonably incurred by such indemnified party
in connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 7(d), an Underwriter shall not
be required to contribute any amount in excess of the underwriting discounts
received by it (less the aggregate amount of any damages which such Underwriter
and its controlling persons have otherwise been required to pay in respect of
the same or any similar claim), and no person found guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) will be
entitled to
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26
contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations to contribute as provided in
this Section 7(d) are several in proportion to their respective underwriting
obligations and not joint. For purposes of this Section 7(d), any person who
controls a party to this Agreement within the meaning of the Act will have the
same rights to contribution as that party, and each officer and director of the
Company who signed the Registration Statement will have the same rights to
contribution as the Company, subject in each case to the provisions hereof.
Any party entitled to contribution, promptly after receipt of notice of
commencement of any action against such party in respect of which a claim for
contribution maybe made under this Section 7(d), will notify any such party or
parties from whom contribution may be sought, but the omission to notify will
not relieve the party or parties from whom contribution may be sought from any
other obligation it or they may have under this Section 7(d). No party will be
liable for contribution with respect to any action or claim settled without its
written consent (which consent will not be unreasonably withheld).
(f) The indemnity and contribution agreements contained
in this Section 7 and the representations and warranties of the Company
contained in this Agreement shall remain operative and in full force and effect
regardless of (i) any investigation made by the Underwriters or on their
behalf, (ii) acceptance of any of the Shares and payment therefor or (iii) any
termination of this Agreement.
8. TERMINATION.
The Underwriters' obligations under this Agreement may be
terminated at any time on or prior to the Closing Date (or, with respect to the
Option Shares, on or prior to the Option Closing Date), by notice to the
Company from the Representatives, without liability on the part of any of the
Underwriters to the Company, if, prior to delivery and payment for the Shares
(or the Option Shares, as the case may be), in your reasonable judgment, (i)
trading in any of the equity securities of the Company shall have been
suspended by the Commission, by an exchange that lists the Shares or by the
Nasdaq National Market, (ii) trading in securities generally on the New York
Stock Exchange, the American Stock Exchange or the Nasdaq National Market shall
have been suspended or limited or minimum or maximum prices shall have been
generally established on such exchange, or additional material governmental
restrictions, not in force on the date of this Agreement, shall have been
imposed upon trading in securities generally by such exchange or by order of
the Commission or any court of other governmental authority, (iii) a general
banking moratorium shall have been declared by either Federal or State
authorities or (iv) any material adverse change in the financial or securities
markets in the United States or in political, financial or economic conditions
in the United States or any outbreak or material escalation of hostilities or
declaration by the United States of a national emergency or war or other
calamity or crisis shall have occurred the effect of any of which is such as to
make it, in your reasonable judgment, impracticable or inadvisable to market
the Shares on the terms and in the manner contemplated by the Prospectus.
9. SUBSTITUTION OF UNDERWRITERS.
If any Underwriter shall fail or refuse to purchase any of the
Firm Shares which it has agreed to purchase hereunder, and the aggregate number
of Firm Shares which such
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defaulting Underwriter agreed but failed or refused to purchase is not more
than one-tenth of the aggregate number of Firm Shares, the other Underwriters
shall be obligated, severally, to purchase the Firm Shares that such defaulting
Underwriter agreed but failed or refused to purchase, in the proportions which
the number of Firm Shares which they have respectively agreed to purchase
pursuant to Section 1 bears to the aggregate number of Firm Shares which all
such non-defaulting Underwriters have so agreed to purchase, or in such other
proportions as you may specify; provided, that in no event shall the maximum
number of Firm shares which an Underwriter has been obligated to purchase
pursuant to Section 1 be increased pursuant to this Section 9 by more than
one-ninth of such number of Firm Shares without the prior written consent of
such Underwriter. If an Underwriter shall fail or refuse to purchase any Firm
Shares and the aggregate number of Firm Shares which such defaulting
Underwriter agreed but failed or refused to purchase exceeds one-tenth of the
aggregate number of the Firm Shares and arrangements satisfactory to the
non-defaulting Underwriters or the Company for the purchase of such Firm Shares
are not made within 48 hours after such default, this Agreement will terminate
without liability on the part of any non-defaulting Underwriter or the Company
for the purchase or sale of any Shares under this Agreement. In any such case
the Underwriters or the Company shall have the right to postpone the Closing
Date, but in no event for longer than seven days, in order that the required
changes, if any, in the Registration Statement and in the Prospectus or in any
other documents or arrangements may be effected. Any action taken pursuant to
this Section 9 shall not relieve any defaulting Underwriter from liability in
respect to any default of such Underwriter under this Agreement.
10. DEFAULT BY A SELLING STOCKHOLDER.
If any of the Selling Stockholders shall fail to sell and
deliver the number of Shares that such Selling Stockholder is obligated to
sell, the Underwriters may, at their option, by notice to the Company, either
(a) require the Company to sell and deliver such number of shares of Common
Stock as to which the Selling Stockholders have defaulted, (b) elect to
purchase the Firm Shares and the Option Shares that the Company and the
non-defaulting Selling Stockholders have agreed to sell pursuant to this
Agreement, or (c) terminate this Agreement if the Company shall have refused to
sell and deliver to the Underwriters the shares of Common Stock referred to in
clause (a) of this Section 10.
In the event of a default under this Section 10 that does not
result in the termination of this Agreement, either the Underwriters or the
Company shall have the right to postpone the Closing Date or Option Closing
Date for a period not exceeding seven days in order to effect any required
changes in the Registration Statement or Prospectus or in any other documents
or arrangements. No action taken pursuant to this Section 10 shall relieve the
Company or the Selling Stockholder so defaulting from liability, if any, in
respect of such default.
11. MISCELLANEOUS.
All communications hereunder shall be in writing and, if sent
to any of the Underwriters, shall be mailed, first class postage prepaid, sent
via reliable overnight delivery service, sent by telefacsimile (and by one of
the two preceding methods), delivered by hand or
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telegraphed and confirmed in writing to the Representatives in care of X.X.
Xxxxxxxx & Co., X.X. Xxxxxxxx Financial Center, 000 Xxxxxxxx Xxxxxx, Xxxxxxxxx,
Xxxxxxxxx 00000, Attention: Xxxxxx X. Xxxxx, XX, or if sent to the Company
shall be sent by one of the foregoing methods to the Company at 000 Xxxx
Xxxxxxx Xxxx, Xxxxxxxxxxxx, Xxxxxxxx 00000, Attention: Xxxxx X. Xxxxxx.
This Agreement has been and is made solely for the several
Underwriters' and the Company's and the Selling Stockholders' benefits and of
the controlling persons, directors and officers referred to in Section 7, and
their respective heirs, executors, administrators, successors and assigns, and
no other person shall acquire or have any right under or by virtue of this
Agreement. The term "successors and assigns" as used in this Agreement shall
not include a purchaser, as such purchaser, of Shares from an Underwriter.
This Agreement shall be governed by and construed in
accordance with the laws of the State of Tennessee.
This Agreement may be signed in two or more counterparts with
the same effect as if the signatures thereto and hereto were upon the same
instrument.
In case any provision in this Agreement shall be invalid,
illegal or unenforceable, the validity, legality and enforceability of the
remaining provisions shall not in any way be affected or impaired thereby.
THE COMPANY, EACH SELLING STOCKHOLDER AND YOU EACH HEREBY
IRREVOCABLY WAIVE ANY RIGHT THEY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY
CLAIM BASED UPON OR ARISING OUT OF THIS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY.
You hereby represent and warrant to the Company and each
Selling Stockholder that you have authority to act hereunder on behalf of the
several Underwriters, and any action hereunder taken by you will be binding
upon all the Underwriters.
Please confirm that the foregoing correctly sets forth the
agreement among the Company, the Selling Stockholders and you.
Very truly yours,
STAFFMARK, INC.
By:
----------------------------------------
Xxxxx X. Xxxxxx
President and Chief Executive Officer
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SELLING STOCKHOLDERS:
By: ____________________________________
___________________, Attorney-in-
Fact for each of the Selling
Stockholders identified on
Schedule II
Confirmed and accepted as of the
date first above written.
X.X. XXXXXXXX & CO.
XXXXXXXXXX SECURITIES
XXXXXXXX INC.
For themselves and as Representatives
of the several Underwriters
By: X.X. Xxxxxxxx & Co.
By:
-----------------------------
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SCHEDULE I
UNDERWRITERS
Number of
Name of Underwriter Firm Shares
------------------- -----------
X.X. Xxxxxxxx & Co. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Xxxxxxxxxx Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Xxxxxxxx Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,500,000
=========
31
SCHEDULE II
SELLING STOCKHOLDERS
Number of
Name of Selling Stockholder Firm Shares
--------------------------- -----------
Xxxxx X. Xxxxxx . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,327
Xxxxx X. Xxxxxx . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70,000
Xxxxxx X. Xxxxx III . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18,495
Bartfund I Limited Partnership . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,000
Xxxxxx X. Xxxx, Xx. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11,700
Xxxxxx X. Xxxxxxx . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,000
Xxxxx Xxxxx Xxxxxxx Trust . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,000
Xxxx X. Xxxxxxx, Xx. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,500
Xxxx Xxx Xxxxxxx . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,500
Xxxxxx Xxxxxxx . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,000
Xxxx X. Xxxxxx . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60,000
Xxxx X. & Xxxxx X. Xxxxxx Charitable Remainder Trust . . . . . . . . . . . . . . . . . . . 47,000
Xxxx X. Xxxxxx . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20,000
Xxxxxxx X. Xxxxxxx . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 860
Xxxxxxx X. Xxxxxxx . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,000
Xxx X. Xxxxxx . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,746
J. Xxxxxxxxxxx Xxxxxx . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,746
Xxxxxx Xxxxxx . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,326
Xxxxx Xxxxxx . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,800
---------
TOTAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 285,000
=========
