1
RARE Hospitality International, Inc.
2,000,000 Shares(1)
Common Stock
(No par value per share)
Underwriting Agreement
February 1, 2001
First Union Securities, Inc.
0 Xx. Xxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxx 00000
Ladies and Gentlemen:
RARE Hospitality International, Inc., a Georgia corporation (the
"Company"), proposes to sell to the several underwriters named in Schedule I
hereto (the "Underwriters"), for whom you (the "Representatives") are acting as
representatives, 2,000,000 shares of Common Stock, no par value per share
("Common Stock") of the Company (said shares to be issued and sold by the
Company being hereinafter called the "Underwritten Securities"). The Company
also proposes to grant to the Underwriters an option to purchase up to 300,000
additional shares of Common Stock to cover over-allotments (the "Option
Securities"; the Option Securities, together with the Underwritten Securities,
being hereinafter called the "Securities"). To the extent there are no
additional Underwriters listed on Schedule I other than you, the term
Representatives as used herein shall mean you, as Underwriters, and the terms
Representatives and Underwriters shall mean either the singular or plural as the
context requires. Any reference herein to the Registration Statement, a
Preliminary Prospectus or the Prospectus shall be deemed to refer to and include
the documents incorporated by reference therein pursuant to Item 12 of Form S-3
which were filed under the Exchange Act on or before the Effective Date of the
Registration Statement or the issue date of such Preliminary Prospectus or the
Prospectus, as the case may be; and any reference herein to the terms "amend,"
"amendment," or "supplement" with respect to the Registration Statement, any
Preliminary Prospectus or the Prospectus shall be deemed to refer to and
---------------
(1) Plus an option to purchase from the Company, up to 300,000 additional
shares of Common Stock to cover over-allotments.
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First Union Securities, Inc.
February 1, 2001
Page 2
include the filing of any document under the Exchange Act after the Effective
Date of the Registration Statement, or the issue date of any Preliminary
Prospectus or the Prospectus, as the case may be, deemed to be incorporated
therein by reference. Certain terms used herein are defined in Section 17
hereof.
1. Representations and Warranties. The Company represents and
warrants to, and agrees with, each Underwriter as set forth below in this
Section 1.
(a) The Company meets the requirements for use of Form
S-3 and has filed with the Commission a registration statement (file
number 333-54150) on such Form, including a related preliminary
prospectus, for the registration under the Act of the Securities and
certain debt securities and related guarantees, preferred stock,
depositary shares and warrants, and the offering thereof from time to
time in accordance with Rule 415 of the rules and regulations under the
Act. The Company has also filed an amendment to such registration
statement (including the form of final prospectus), a copy of which has
been furnished to you. After the Effective Date of such registration
statement, the Company will next file a prospectus supplement and final
prospectus in accordance with Rule 430A and 424(b) and/or (c). The
Company has included in such registration statement, as amended at the
Effective Date, all information (other than Rule 430A Information)
required by the Act and the rules thereunder to be included in such
registration statement and the Prospectus. As filed, such amendment and
form of final prospectus, or such final prospectus and prospectus
supplement, shall contain all Rule 430A Information, together with all
other such required information, and, except to the extent the
Representatives shall agree in writing to a modification, shall be in
all substantive respects in the form furnished to you prior to the
Execution Time or, to the extent not completed at the Execution Time,
shall contain only such specific additional information and other
changes (beyond that contained in the Registration Statement at the
time it was declared effective) as the Company has advised you, prior
to the Execution Time, will be included or made therein.
(b) On the Effective Date, the Registration Statement did
or will, and when the Prospectus is first filed (if required) in
accordance with Rule 424(b) or (c) and on the Closing Date (as defined
herein) and on any date on which Option Securities are purchased, if
such date is not the Closing Date (a "settlement date"), the Prospectus
(and any supplements thereto) will, comply in all material respects
with the applicable requirements of the Act, the Exchange Act and the
rules thereunder; on the Effective Date and at the Execution Time, the
Registration Statement did not or will not contain any untrue statement
of a material fact or omit to state any material fact required to be
stated therein or necessary in order to make the statements therein not
misleading; and, on the Effective Date, the Prospectus did not, and on
the date of any filing pursuant to Rule 424(b) and on the Closing Date
and any settlement date, the Prospectus (together with any supplement
thereto) will not, contain any 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; provided, however, that the Company makes no
representations or warranties as to the information contained in or
omitted from the Registration Statement, or the Prospectus in reliance
upon and in conformity with
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First Union Securities, Inc.
February 1, 2001
Page 3
information furnished in writing to the Company by or on behalf of any
Underwriter through the Representatives specifically for inclusion in
the Registration Statement or the Prospectus.
(c) The Company is a corporation duly organized, validly
existing and in good standing under the laws of the State of Georgia
with full corporate power and authority to own, lease and operate its
properties and to conduct its business as described in the Prospectus,
and is duly registered and qualified to conduct its business and is in
good standing in each jurisdiction or place where the nature of its
properties or the conduct of its business requires such registration or
qualification, except where the failure so to register or qualify or be
in good standing does not have a material adverse effect on the
condition (financial or other), business, prospects, earnings,
properties, net worth or results of operations of the Company and its
Subsidiaries (as hereinafter defined) taken as a whole (a "Material
Adverse Effect").
(d) All the Company's subsidiaries (as defined in the
Act), exclusive of the subsidiaries listed on Schedule II hereto (the
"Inactive Subsidiaries"), are referred to herein individually as a
"Subsidiary" and collectively as the "Subsidiaries." Each Subsidiary
that is a corporation is a corporation duly organized, validly existing
and in good standing in the jurisdiction of its incorporation. Each
Subsidiary that is a partnership is duly organized, validly existing
and in good standing in the jurisdiction of its organization. Each
Subsidiary has full power and authority to own, lease and operate its
properties and to conduct its business as described in the Prospectus,
and is duly registered and qualified to conduct its business and is in
good standing in each jurisdiction or place where the nature of its
properties or the conduct of its business requires such registration or
qualification, except where the failure so to register or qualify or be
in good standing does not have a Material Adverse Effect. None of the
Inactive Subsidiaries is engaged in any business activities or
operations or has any material assets or liabilities. All the
outstanding shares of capital stock of each of the Subsidiaries that is
a corporation have been duly authorized and validly issued, are fully
paid and nonassessable. All of the partnership interests in each of the
Subsidiaries that is a partnership have been duly authorized and
validly issued. Except for directors' qualifying shares or similar
interests, and except as set forth on Schedule II hereto, the
Subsidiaries are wholly owned by the Company directly or indirectly
through one of the other Subsidiaries, free and clear of any lien,
adverse claim, security interest, equity or other encumbrance, except
as described in the Prospectus.
(e) Since the respective dates as of which information is
given in the Registration Statement and the Prospectus, there has not
been any material adverse change in the condition (financial or other),
business, prospects, earnings, properties, net worth or results of
operations of the Company and its Subsidiaries, taken as a whole,
whether or not arising from transactions in the ordinary course of
business, except as set forth in or contemplated in the Registration
Statement and Prospectus, and since such dates, except in the ordinary
course of business, neither the Company nor any of its subsidiaries has
entered into any material transaction not referred to in the
Registration Statement and the Prospectus.
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First Union Securities, Inc.
February 1, 2001
Page 4
(f) This Agreement has been duly authorized, executed and
delivered by the Company.
(g) The Company's authorized and outstanding equity
capitalization is as set forth in the Prospectus; the capital stock of
the Company conforms in all material respects to the description
thereof contained in the Prospectus; the outstanding shares of Common
Stock have been duly authorized and validly issued and are fully paid
and nonassessable; the Securities have been duly authorized for
issuance and sale pursuant to this Agreement, and, when issued and
delivered to and paid for by the Underwriters pursuant to this
Agreement, will be validly issued, fully paid and nonassessable and
will conform in all material respects to the description of Common
Stock contained in the Prospectus; no further approval or authority of
shareholders or the Board of Directors of the Company is required for
the issuance and sale of the Securities by the Company as contemplated
herein; all outstanding shares of Common Stock have been issued in
compliance with federal and, if applicable, Georgia Securities laws;
the Securities are duly listed, and admitted and authorized for
quotation, subject to official notice of issuance, on the Nasdaq
National Market; the certificates for the Securities are in valid and
sufficient form and comply in all material respects with the applicable
requirements of law, the Company's charter and bylaws and the Nasdaq
National Market; the holders of outstanding shares of capital stock of
the Company are not entitled to preemptive or other rights to subscribe
for the Securities; and, except as set forth in the Prospectus, no
options, warrants or other rights to purchase, agreements or other
obligations to issue, or rights to convert any obligations into or
exchange any securities for, shares of capital stock of or ownership
interests in the Company are outstanding.
(h) The Company is not and, after giving effect to the
offering and sale of the Securities and the application of the proceeds
thereof as described in the Prospectus, will not be an "investment
company" as defined in the Investment Company Act of 1940, as amended.
(i) No consent, approval, authorization, filing with or
order of any court or governmental agency or body is required in
connection with the transactions contemplated herein, except such as
have been obtained under the Act and such as may be required under the
blue sky laws of any jurisdiction in connection with the purchase and
distribution of the Securities by the Underwriters in the manner
contemplated herein and in the Prospectus.
(j) Neither the issue and sale of the Securities nor the
consummation of any other of the transactions herein contemplated nor
the fulfillment of the terms hereof will conflict with, result in a
breach, default or violation or imposition of any lien, charge or
encumbrance upon any property or assets of the Company or any of its
Subsidiaries pursuant to, (i) the charter or by-laws of the Company or
any of its Subsidiaries, (ii) the terms of any indenture, contract,
lease, mortgage, deed of trust, note agreement, loan agreement or other
agreement, obligation, condition, covenant or instrument to which the
Company or any of its Subsidiaries is a party or bound or to which its
or their property is subject, or (iii) any statute, law, rule,
regulation, judgment, order or decree applicable to the Company or any
of its Subsidiaries of any court, regulatory body, administrative
agency, governmental body, arbitrator or other authority having
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First Union Securities, Inc.
February 1, 2001
Page 5
jurisdiction over the Company or any of its Subsidiaries or any of its
or their properties; except, with regard to clauses (ii) and (iii), for
those violations or defaults which would not have a Material Adverse
Effect.
(k) Except as disclosed in the Registration Statement and
Prospectus, there are no contracts, agreements or understandings
between the Company and any person granting such person the right to
require the Company to file a registration statement under the Act with
respect to any securities of the Company or to include any securities
of the Company in any registration statement of the Company. Neither
the filing of the Registration Statement nor the offering or sale of
the Securities as contemplated by this Agreement gives rise to any
rights for or relating to the registration of any securities of the
Company.
(l) The consolidated financial statements and the related
schedules and notes of the Company and its consolidated Subsidiaries
included or incorporated by reference in the Prospectus and the
Registration Statement present fairly the consolidated financial
condition, results of operations and cash flows of the Company as of
the dates and for the periods indicated, comply as to form with the
applicable accounting requirements of the Act and have been prepared in
conformity with generally accepted accounting principles applied on a
consistent basis throughout the periods involved (except as otherwise
noted therein). The selected financial data set forth under the caption
"Selected Financial Information" in the Prospectus and Registration
Statement fairly present, on the basis stated in the Prospectus and the
Registration Statement, the information included therein. The other
financial and statistical information and data set forth in the
Registration Statement and Prospectus are, in all material respects,
accurately presented and prepared on a basis consistent with such
financial statements and the books and records of the Company. No other
financial statements, supporting schedules or other financial
information (whether pro forma financial statements or otherwise) are
required to be included in the Registration Statement or Prospectus. As
of the date of the Prospectus, the Company is not engaged in
substantive discussions with any third party with respect to, or
obligated to complete, any acquisitions for which disclosure of pro
forma financial information in the Prospectus is required by the Act.
(m) No action, suit or proceeding by or before any court
or governmental agency, authority or body or any arbitrator involving
the Company or any of its Subsidiaries or its or their property is
pending or, to the best knowledge of the Company, threatened that (i)
could reasonably be expected to have a material adverse effect on the
performance of this Agreement or the consummation of any of the
transactions contemplated hereby, (ii) could reasonably be expected to
have a Material Adverse Effect, whether or not arising from
transactions in the ordinary course of business, except as set forth in
or contemplated in the Prospectus or (iii) is required to be described
in the Registration Statement or Prospectus and is not so described;
nor are there any statutes, rules, regulations, laws, orders, decrees,
judgments, contracts, instruments or other documents or agreements that
are required to be described in the Registration Statement or
Prospectus or to be filed as exhibits to the Registration Statement
that are not so described or filed as required. Without limiting the
generality of the foregoing sentence, the Company has no
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First Union Securities, Inc.
February 1, 2001
Page 6
reason to believe that any legal or governmental proceedings will be
instituted against it or any of its Subsidiaries and, to the best
knowledge of the Company, there exists no basis for any legal or
governmental proceedings to be instituted against it or any of its
Subsidiaries.
(n) Neither the Company nor any Subsidiary is in
violation or default of (i) any provision of its charter or bylaws,
(ii) the terms of any indenture, contract, lease, mortgage, deed of
trust, note agreement, loan agreement or other agreement, obligation,
condition, covenant or instrument to which it is a party or bound or to
which its property is subject, or (iii) any statute, law, rule,
regulation, judgment, order or decree of any court, regulatory body,
administrative agency, governmental body, arbitrator or other authority
having jurisdiction over the Company or such Subsidiary or any of its
properties, as applicable, excluding, for purposes of clauses (ii) and
(iii), any violation or default which would not have a Material Adverse
Effect.
(o) KPMG LLP, who have certified certain financial
statements of the Company and its consolidated Subsidiaries and
delivered their report with respect to the audited consolidated
financial statements and schedules included in the Prospectus, are
independent public accountants with respect to the Company within the
meaning of the Act and the applicable published rules and regulations
thereunder.
(p) The Company has filed all foreign, federal, state and
local tax returns that are required to be filed or has requested
extensions thereof (except in any case in which the failure so to file
would not have a Material Adverse Effect), except as set forth in or
contemplated in the Prospectus and has paid all taxes required to be
paid by it and any other assessment, fine or penalty levied against it,
to the extent that any of the foregoing is due and payable, except for
any such assessment, fine or penalty that is currently being contested
in good faith or as would not have a Material Adverse Effect, whether
or not arising from transactions in the ordinary course of business,
except as set forth in or contemplated in the Prospectus.
(q) No labor problem or dispute with the employees of the
Company or any of its Subsidiaries exists or is threatened or imminent,
and the Company is not aware of any existing or imminent labor
disturbance by the employees of any of its or its Subsidiaries'
principal suppliers, contractors or customers that could have a
Material Adverse Effect, whether or not arising from transactions in
the ordinary course of business, except as set forth in or contemplated
in the Prospectus.
(r) The Company and each of its Subsidiaries are insured
by insurers of recognized financial responsibility against such losses
and risks and in such amounts as are prudent and customary in the
businesses in which they are engaged; all policies of insurance
insuring the Company or any of its Subsidiaries or their respective
businesses, assets, employees, officers and directors are in full force
and effect; the Company and its Subsidiaries are in compliance with the
terms of such policies and instruments in all material respects; and
there are no claims by the Company or any of its Subsidiaries under any
such policy or instrument as to which any insurance company is denying
liability or defending under a reservation of rights clause; neither
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First Union Securities, Inc.
February 1, 2001
Page 7
the Company nor any such Subsidiary has been refused any insurance
coverage sought or applied for; and neither the Company nor any such
Subsidiary has any reason to believe that it will not be able to renew
its existing insurance coverage as and when such coverage expires or to
obtain similar coverage from similar insurers as may be necessary to
continue its business at a cost that would not have a Material Adverse
Effect, whether or not arising from transactions in the ordinary course
of business, except as set forth in or contemplated in the Prospectus.
(s) No Subsidiary of the Company is currently prohibited,
directly or indirectly, from paying any dividends to the Company, from
making any other distribution on such Subsidiary's capital stock, from
repaying to the Company any loans or advances to such Subsidiary from
the Company or from transferring any of such Subsidiary's property or
assets to the Company or any other Subsidiary of the Company, except as
described in or contemplated by the Prospectus.
(t) The Company and its Subsidiaries possess all
licenses, certificates, permits and other authorizations issued by the
appropriate federal, state, local or foreign regulatory authorities
necessary to conduct their respective businesses, except for those
which the failure to possess would not result in a Material Adverse
Effect, and neither the Company nor any such Subsidiary has received
any notice of proceedings relating to the revocation or modification of
any such certificate, authorization or permit which, singly or in the
aggregate, if the subject of an unfavorable decision, ruling or
finding, would have a Material Adverse Effect, whether or not arising
from transactions in the ordinary course of business, except as set
forth in or contemplated in the Prospectus.
(u) The Company and each of its Subsidiaries maintain a
system of internal accounting controls sufficient to provide reasonable
assurance that (i) transactions are executed in accordance with
management's general or specific authorizations; (ii) transactions are
recorded as necessary to permit preparation of financial statements in
conformity with generally accepted accounting principles and to
maintain asset accountability; (iii) access to assets is permitted only
in accordance with management's general or specific authorization; and
(iv) the recorded accountability for assets is compared with the
existing assets at reasonable intervals and appropriate action is taken
with respect to any differences.
(v) The Company has not taken, directly or indirectly,
any action designed to or which has constituted or which might
reasonably be expected to cause or result, under the Exchange Act or
otherwise, in stabilization or manipulation of the price of any
security of the Company to facilitate the sale or resale of the
Securities.
(w) (i) Each of the Company and its Subsidiaries is in
compliance with any and all applicable foreign, federal, state and
local rules, laws and regulations relating to the use, treatment,
storage and disposal of toxic substances and protection of human health
or the environment ("Environmental Laws") which are applicable to its
business; (ii) neither the Company nor its Subsidiaries has received
notice of any actual or potential liability for the
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First Union Securities, Inc.
February 1, 2001
Page 8
investigation or remediation of any disposal or release of hazardous or
toxic substances or wastes, pollutants or contaminants, except where
such noncompliance with Environmental Laws, failure to receive required
permits, licenses or other approvals, or liability would not,
individually or in the aggregate, have a Material Adverse Effect; (iii)
each of the Company and its Subsidiaries has received all permits,
licenses or other approvals required of it under applicable
Environmental Laws to conduct its business and is in compliance with
all terms and conditions of any such permit, license or approval; (iv)
no facts currently exist that will require the Company or its
Subsidiaries to make future material capital expenditures to comply
with Environmental Laws; and (v) no property which is or has been
owned, leased or occupied by the Company or its Subsidiaries has been
designated as a Superfund site pursuant to the Comprehensive
Environmental Response, Compensation of Liability Act of 1980, as
amended (42 U.S.C. Section 9601, et seq.) ("CERCLA") or otherwise
designated as a contaminated site under applicable state or local law.
Except as set forth in the Prospectus, neither the Company nor any of
its Subsidiaries has been named as a "potentially responsible party"
under CERCLA.
(x) The Company has considered the effect of
Environmental Laws on the business, operations and properties of the
Company and its Subsidiaries and has reasonably concluded that any
costs and liabilities associated with Environmental Laws would not,
singly or in the aggregate, have a Material Adverse Effect, whether or
not arising from transactions in the ordinary course of business,
except as set forth in or contemplated in the Prospectus.
(y) Each of the Company and its Subsidiaries has
fulfilled its obligations, if any, under the minimum funding standards
of Xxxxxxx 000 xx xxx Xxxxxx Xxxxxx Employee Retirement Income Security
Act of 1974 ("ERISA") and the regulations and published interpretations
thereunder with respect to each "plan" (as defined in Section 3(3) of
ERISA and such regulations and published interpretations) in which
employees of the Company and its Subsidiaries are eligible to
participate and each such plan is in compliance in all material
respects with the presently applicable provisions of ERISA and such
regulations and published interpretations. The Company and its
Subsidiaries have not incurred any unpaid liability to the Pension
Benefit Guaranty Corporation (other than for the payment of premiums in
the ordinary course) or to any such plan under Title IV of ERISA.
(z) The Company and the Subsidiaries own or possess all
patents, trademarks, trademark registrations, service marks, service
xxxx registrations, trade names, copyrights, licenses, inventions,
domain names, computer programs, know-how (including, without
limitation, trade secrets and other unpatented or unpatentable
proprietary or confidential information, systems or procedures)
(collectively "Intellectual Property") described in the Prospectus as
being owned by any of them or currently used by them in the conduct of
their respective businesses, and the Company is not aware of any claim
to the contrary or any challenge by any other person to the rights of
the Company and the Subsidiaries with respect to the foregoing. Neither
the Company nor any of its Subsidiaries is infringing or otherwise
violating any Intellectual Property of others or has received any
notice of infringement of or conflict with asserted rights of others
with respect to any Intellectual Property.
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First Union Securities, Inc.
February 1, 2001
Page 9
(aa) All sales of the Company's securities prior to the
date hereof were at all relevant times duly registered under the Act
and applicable foreign securities laws and state securities or Blue Sky
laws or were exempt from the registration requirements of the Act and
applicable foreign and state securities laws, or if such securities
were not registered or exempt in compliance with the Act and applicable
foreign and state securities laws, any private right of action for
rescission or damages arising from the failure to register any such
securities are time barred by applicable statutes of limitations or
equitable principles, including laches.
(bb) The Company and each of its Subsidiaries has good and
marketable title in fee simple to all items of real property and good
and marketable title to all personal property described in the
Prospectus as being owned by it. Any real property and buildings
described in the Prospectus as being held under lease by the Company
and each of its Subsidiaries is held by it under valid, existing and
enforceable leases, free and clear of all liens, encumbrances, claims,
security interests and defects, except such as are described, or
incorporated by reference, in the Registration Statement and the
Prospectus or would not have a Material Adverse Effect.
(cc) No transaction has occurred between or among the
Company and any of its officers or directors or five percent
shareholders or any affiliate or affiliates of any such officer or
director or five percent shareholders that is required to be described
in and is not described in the Registration Statement and the
Prospectus.
Any certificate signed by any officer of the Company and delivered to
the Representatives or counsel for the Underwriters in connection with the
offering of the Securities shall be deemed a representation and warranty by the
Company, as to matters covered thereby, to each Underwriter.
2. Purchase and Sale.
(a) Subject to the terms and conditions and in reliance
upon the representations and warranties herein set forth, the Company
agrees to sell to each Underwriter, and each Underwriter agrees,
severally and not jointly, to purchase from the Company, at a purchase
price of $25.30 per share, the amount of the Underwritten Securities
set forth opposite such Underwriter's name in Schedule I hereto.
(b) Subject to the terms and conditions and in reliance
upon the representations and warranties herein set forth, the Company
hereby grants an option to the several Underwriters to purchase,
severally and not jointly, up to 300,000 Option Securities at the same
purchase price per share as the Underwriters shall pay for the
Underwritten Securities. Said option may be exercised only to cover
over-allotments in the sale of the Underwritten Securities by the
Underwriters. Said option 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 upon written or facsimile notice by the
Representatives to the Company setting forth the number of shares of
the Option Securities as to which the several Underwriters are
exercising the option and the settlement date. Delivery of certificates
for the shares of Option Securities by the Company, and payment
therefor to the
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First Union Securities, Inc.
February 1, 2001
Page 10
Company, shall be made as provided in Section 3 hereof. The number of
Option Securities to be purchased by each Underwriter shall be the same
percentage of the total number of shares of the Option Securities to be
purchased by the several Underwriters as such Underwriter is purchasing
of the Underwritten Securities, subject to such adjustments as you in
your absolute discretion shall make to eliminate any fractional shares.
3. Delivery and Payment. Delivery of and payment for the
Underwritten Securities and the Option Securities (if the option provided for in
Section 2(b) hereof shall have been exercised on or before the third Business
Day prior to the Closing Date) shall be made at 10:00 AM, New York City time, on
February 7, 2001, or at such time on such later date not more than three
Business Days after the foregoing date as the Representatives shall designate,
which date and time may be postponed by agreement between the Representatives
and the Company or as provided in Section 9 hereof (such date and time of
delivery and payment for the Securities being herein called the "Closing Date").
Delivery of the Securities shall be made to the Representatives for the
respective accounts of the several Underwriters against payment by the several
Underwriters through the Representatives of the purchase price thereof to or
upon the order of the Company by wire transfer payable in same-day funds to an
account specified by the Company. Delivery of the Underwritten Securities and
the Option Securities shall be made through the facilities of The Depository
Trust Company unless the Representatives shall otherwise specify.
If the option provided for in Section 2(b) hereof is exercised after
the third Business Day prior to the Closing Date, the Company will deliver the
Option Securities (at the expense of the Company) to the Representatives on the
date specified by the Representatives (which shall be within three Business Days
after exercise of said option) for the respective accounts of the several
Underwriters, against payment by the several Underwriters through the
Representatives of the purchase price thereof to or upon the order of the
Company by wire transfer payable in same-day funds to an account specified by
the Company. If settlement for the Option Securities occurs after the Closing
Date, the Company will deliver to the Representatives on the settlement date for
the Option Securities, and the obligation of the Underwriters to purchase the
Option Securities shall be conditioned upon receipt of, supplemental opinions,
certificates and letters confirming as of such date the opinions, certificates
and letters delivered on the Closing Date pursuant to Section 6 hereof.
4. Offering by Underwriters. It is understood that the several
Underwriters propose to offer the Securities for sale to the public as set forth
in the Prospectus.
5. Agreements. The Company agrees with the several Underwriters
that:
(a) Prior to the termination of the offering of the
Securities, the Company will not file any amendment of the Registration
Statement or supplement to the Prospectus or any Rule 462(b)
Registration Statement unless the Company has furnished you a copy for
your review prior to filing and will not file any such proposed
amendment or supplement to which you reasonably object. Subject to the
foregoing sentence, if filing of the Prospectus is required under Rule
424(b) or (c), or otherwise, the Company will cause the Prospectus,
properly completed, and any supplement thereto to be filed with the
Commission pursuant to the applicable paragraph of
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First Union Securities, Inc.
February 1, 2001
Page 11
Rule 424(b) or (c), if applicable, within the time period prescribed
and will provide evidence satisfactory to the Representatives of such
timely filing. The Company will promptly advise the Representatives (1)
when the Prospectus, and any supplement thereto, shall have been filed
(if required) with the Commission pursuant to Rule 424(b) or (c) or
when any Rule 462(b) Registration Statement shall have been filed with
the Commission, (2) when, prior to termination of the offering of the
Securities, any amendment to the Registration Statement shall have been
filed or become effective, (3) of any request by the Commission or its
staff for any amendment of the Registration Statement, or any Rule
462(b) Registration Statement, or for any supplement to the Prospectus
or for any additional information, (4) of the issuance by the
Commission of any stop order suspending the effectiveness of the
Registration Statement or the institution or threatening of any
proceeding for that purpose and (5) of the receipt by the Company of
any notification with respect to the suspension of the qualification of
the Securities for sale in any jurisdiction or the institution or
threatening of any proceeding for such purpose. The Company will use
its best efforts to prevent the issuance of any such stop order or the
suspension of any such qualification and, if issued, to obtain as soon
as possible the withdrawal thereof.
(b) If, at any time when a prospectus relating to the
Securities is required to be delivered under the Act, any event occurs
as a result of which, in the reasonable opinion of counsel for the
Company or of counsel for the Underwriters, the Prospectus as then
supplemented would include any untrue statement of a material fact or
omit to state any material fact necessary to make the statements
therein in the light of the circumstances under which they were made
not misleading, or if it shall be necessary to amend the Registration
Statement or supplement the Prospectus to comply with the Act or the
rules thereunder, the Company promptly will (1) notify the
Representatives of any such event; (2) prepare and file with the
Commission, subject to the second sentence of paragraph (a) of this
Section 5, an amendment or supplement which will correct such statement
or omission or effect such compliance; and (3) supply any supplemented
Prospectus to you in such quantities as you may reasonably request.
(c) As soon as practicable, the Company will make
generally available to its security holders and to the Representatives
an earnings statement or statements of the Company and its subsidiaries
which will satisfy the provisions of Section 11(a) of the Act and Rule
158 under the Act.
(d) The Company will furnish to the Representatives and
counsel for the Underwriters signed copies of the Registration
Statement (including exhibits thereto) and to each other Underwriter a
copy of the Registration Statement (without exhibits thereto) and, so
long as delivery of a prospectus by an Underwriter or dealer may be
required by the Act, as many copies of the Prospectus and any
supplement thereto as the Representatives may reasonably request.
(e) The Company will arrange, if necessary, for the
qualification of the Securities for sale under the laws of such
jurisdictions as the Representatives may designate and will maintain
such qualifications in effect so long as required for the distribution
of the Securities; provided that in no event shall the Company be
obligated to qualify to do business in any jurisdiction where it
12
First Union Securities, Inc.
February 1, 2001
Page 12
is not now so qualified or to take any action that would subject it to
service of process in suits, other than those arising out of the
offering or sale of the Securities, in any jurisdiction where it is not
now so subject.
(f) The Company will not take, directly or indirectly,
any action designed to or which has constituted or which might
reasonably be expected to cause or result, under the Exchange Act or
otherwise, in stabilization or manipulation of the price of any
security of the Company to facilitate the sale or resale of the
Securities.
(g) The Company agrees to pay the costs and expenses
relating to the following matters: (i) the preparation, printing or
reproduction and filing with the Commission of the Registration
Statement (including financial statements and exhibits thereto), each
Preliminary Prospectus, the Prospectus, and each amendment or
supplement to any of them; (ii) the printing (or reproduction) and
delivery (including postage, air freight charges and charges for
counting and packaging) of such copies of the Registration Statement,
each Preliminary Prospectus, the Prospectus, and all amendments or
supplements to any of them, as may, in each case, be reasonably
requested for use in connection with the offering and sale of the
Securities; (iii) the preparation, printing, authentication, issuance
and delivery of certificates for the Securities, including any stamp or
transfer taxes in connection with the original issuance and sale of the
Securities; (iv) the printing (or reproduction) and delivery of this
Agreement, any blue sky memorandum and all other agreements or
documents printed (or reproduced) and delivered in connection with the
offering of the Securities; (v) the registration of the Securities
under the Exchange Act and the listing of the Securities on the Nasdaq
National Market; (vi) any registration or qualification of the
Securities for offer and sale under the securities or blue sky laws of
the several states (including filing fees and the reasonable fees and
expenses of counsel for the Underwriters relating to such registration
and qualification); (vii) any filings required to be made with the
National Association of Securities Dealers, Inc. (including filing fees
and the reasonable fees and expenses of counsel for the Underwriters
relating to such filings); (viii) the transportation and other expenses
incurred by or on behalf of Company representatives in connection with
presentations to prospective purchasers of the Securities; (ix) the
fees and expenses of the Company's accountants and the fees and
expenses of counsel (including local and special counsel) for the
Company; and (x) all other costs and expenses incident to the
performance by the Company of its obligations hereunder.
(h) The Company, during the period when the prospectus is
required to be delivered under the Act or the Exchange Act, will file
all documents required to be filed with the Commission pursuant to the
Exchange Act within the time periods required by the Exchange Act and
the regulations thereunder.
(i) The Company will apply the net proceeds from the sale
of Securities to be sold by it hereunder substantially in accordance
with the description set forth in the Prospectus.
13
First Union Securities, Inc.
February 1, 2001
Page 13
6. Conditions to the Obligations of the Underwriters. The
obligations of the Underwriters to purchase the Underwritten Securities and the
Option Securities, as the case may be, shall be subject to the accuracy of the
representations and warranties on the part of the Company contained herein as of
the Execution Time, the Closing Date and any settlement date pursuant to Section
3 hereof, to the accuracy of the statements of the Company made in any
certificates pursuant to the provisions hereof, to the performance by the
Company of its obligations hereunder and to the following additional conditions:
(a) If filing of the Prospectus, or any supplement
thereto, is required pursuant to Rule 424(b) or (c), the Prospectus,
and any such supplement, will be filed in the manner and within the
time period required by such Rule; and no stop order suspending the
effectiveness of the Registration Statement shall have been issued and
no proceedings for that purpose shall have been instituted or
threatened.
(b) The Company shall have furnished to the
Representatives the opinion of Xxxxxx & Bird LLP, counsel for the
Company, dated the Closing Date and addressed to the Representatives,
to the effect that:
(i) the Company has been duly incorporated and
is validly existing as a corporation in good standing under
the laws of the State of Georgia, with full corporate power
and authority to own or lease, as the case may be, and to
operate its properties and conduct its business as described
in the Registration Statement and the Prospectus, and is duly
qualified to do business as a foreign corporation and is in
good standing under the laws of each jurisdiction which
requires such qualification, except where the failure so to
register or qualify or be in good standing does not have a
Material Adverse Effect;
(ii) Each Subsidiary that is a corporation is a
corporation duly organized, validly existing and in good
standing in the jurisdiction of its incorporation. Each
Subsidiary that is a partnership is duly organized, validly
existing and in good standing in the jurisdiction of its
organization. Each Subsidiary has full power and authority to
own, lease and operate its properties and to conduct its
business as described in the Prospectus, and is duly
registered and qualified to conduct its business and is in
good standing in each jurisdiction or place where the nature
of its properties or the conduct of its business requires such
registration or qualification, except where the failure so to
register or qualify or be in good standing does not have a
Material Adverse Effect;
(iii) all the issued and outstanding shares of
capital stock of each Subsidiary that is a corporation have
been duly authorized and validly issued and are fully paid and
nonassessable. All of the partnership interests in each of the
Subsidiaries that are partnerships have been duly authorized
and validly issued. Except as otherwise set forth in the
Prospectus or on Schedule II to this Agreement, the
Subsidiaries are wholly owned by the Company either directly
or through wholly owned subsidiaries free and clear of any
perfected security interest or, to the knowledge of such
counsel, after due inquiry, any other security interest,
claim, lien or encumbrance;
14
First Union Securities, Inc.
February 1, 2001
Page 14
(iv) the Company's authorized and outstanding
equity capitalization is as set forth in the Prospectus; the
capital stock of the Company conforms in all material respects
to the description thereof contained in the Prospectus; the
outstanding shares of Common Stock have been duly authorized
and validly issued and are fully paid and nonassessable; the
Securities have been duly authorized, and, when issued and
delivered to and paid for by the Underwriters pursuant to this
Agreement, will be validly issued, fully paid and
nonassessable and will conform in all material respects to the
description of Common Stock contained in the Prospectus; all
shares of Common Stock that have been issued during the
three-year period prior to the Closing Date, and with respect
to which issuances such counsel assisted the Company, have
been issued in compliance with federal and, if applicable,
Georgia securities laws; the Securities are duly listed, and
admitted and authorized for quotation, subject to official
notice of issuance, on the Nasdaq National Market; the
certificates for the Securities are in valid and sufficient
form; the holders of outstanding shares of capital stock of
the Company are not entitled to preemptive or other rights to
subscribe for the Securities; and, to the knowledge of such
counsel, except as set forth in the Prospectus, no options,
warrants or other rights to purchase, agreements or other
obligations to issue, or rights to convert any obligations
into or exchange any securities for, shares of capital stock
of or ownership interests in the Company are outstanding;
(v) to the knowledge of such counsel, there is
no pending or threatened action, suit or proceeding by or
before any court or governmental agency, authority or body or
any arbitrator involving the Company or the Subsidiaries or
its or their property of a character required to be disclosed
in the Registration Statement which is not adequately
disclosed in the Prospectus, and there is no franchise,
contract, indenture, agreement or other document of a
character required to be described in the Registration
Statement or Prospectus, or to be filed as an exhibit thereto
or as an exhibit to any document filed under the Exchange Act,
which is not described or filed as required;
(vi) the Registration Statement has become
effective under the Act; any required filing of the
Prospectus, and any supplements thereto, pursuant to Rule
424(b) or (c) has been made in the manner and within the time
period required by such Rule; to the knowledge of such
counsel, no stop order suspending the effectiveness of the
Registration Statement has been issued and, no proceedings for
that purpose have been instituted or threatened; the
Registration Statement and the Prospectus, including the
documents incorporated by reference therein (other than the
financial statements and other financial information contained
therein, as to which such counsel need express no opinion)
comply as to form in all material respects with the applicable
requirements of the Act and the Exchange Act and the rules
thereunder;
(vii) The Company has the corporate power and
authority to enter into this Agreement and to issue, sell and
deliver the Securities to be sold as provided herein, and
15
First Union Securities, Inc.
February 1, 2001
Page 15
this Agreement has been duly authorized, executed and
delivered by the Company and is a valid, legal and binding
agreement of the Company;
(viii) the Company is not and, after giving effect
to the offering and sale of the Securities and the application
of the proceeds thereof as described in the Prospectus, will
not be, an "investment company" as defined in the Investment
Company Act of 1940, as amended;
(ix) no consent, approval, authorization, or
other action by, or filing with or order of any court or
governmental agency or body is required in connection with the
transactions contemplated herein, except such as have been
obtained under the Act or the Exchange Act and such as may be
required under the blue sky laws of any jurisdiction in
connection with the purchase and distribution of the
Securities by the Underwriters and such other approvals
(specified in such opinion) as have been obtained;
(x) neither the Company nor any Subsidiary is,
or with the giving of notice or lapse of time or both, would
be, (A) in violation of its respective certificate or articles
of incorporation or bylaws, or other governing documents or,
(B) to the knowledge of such counsel, in default in the
performance of any obligation, agreement or condition
contained in any bond, debenture, note or other evidence of
indebtedness or in any material agreement, indenture, lease or
other instrument to which the Company or any such Subsidiaries
is a party or by which any of them or any of their respective
properties may be bound, or (C) to the knowledge of such
counsel, in violation of any law, ordinance, administrative or
governmental rule or regulation applicable to the Company or
any of the Subsidiaries or of any decree of any court or
governmental agency or body having jurisdiction over the
Company or any Subsidiary, except as may be disclosed in the
Prospectus;
(xi) neither the issue and sale of the
Securities, nor the consummation of any other of the
transactions herein contemplated nor the fulfillment of the
terms hereof does or will conflict with, result in a breach,
default or violation of or the creation or imposition of any
lien, charge or encumbrance upon any property or assets of the
Company or the Subsidiaries pursuant to, (A) the certificate
or articles of incorporation, by-laws or other organizational
documents of the Company or the Subsidiaries, (B) the terms of
any material indenture, contract, lease, mortgage, deed of
trust, note agreement, loan agreement or other agreement,
obligation, condition, covenant or instrument to which the
Company or the Subsidiary is a party or bound or to which its
or their property is subject, or (C) any statute, law, rule,
regulation, judgment, order or decree known to such counsel to
be applicable to the Company or the Subsidiaries of any court,
regulatory body, administrative agency, governmental body,
arbitrator or other authority having jurisdiction over the
Company or the Subsidiaries or any of its or their properties;
and
16
First Union Securities, Inc.
February 1, 2001
Page 16
(xii) except as set forth in the Registration
Statement or Prospectus, no holders of securities of the
Company have rights to the registration of such securities
under the Registration Statement.
In rendering such opinion, such counsel may rely (A) as to matters
involving the application of laws of any jurisdiction other than the
State of Georgia or the United States, to the extent they deem proper
and specified in such opinion, upon the opinion of other counsel of
good standing whom they believe to be reliable and who are satisfactory
to counsel for the Underwriters and (B) as to matters of fact, to the
extent they deem proper, on certificates of responsible officers of the
Company and public officials. References to the Prospectus in this
paragraph (b) include any supplements thereto at the Closing Date. The
opinion of such counsel shall be rendered to the Underwriters at the
request of the Company and shall so state therein.
In addition, such counsel shall provide a statement to the
effect that such counsel has no reason to believe that on the Effective
Date or at the Execution Time, the Registration Statement contains or
contained any untrue statement of a material fact or omitted or omits
to state any material fact required to be stated therein or necessary
to make the statements therein not misleading or that the Prospectus as
of its date and on the Closing Date contains or contained any untrue
statement of a material fact or omitted or omits to state a material
fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading (in each case,
other than the financial statements and other financial information
contained therein, as to which such counsel need express no opinion).
(c) The Representatives shall have received from Xxxxx,
Xxxxxxxx & Xxxxxxx, LLP, counsel for the Underwriters, such opinion or
opinions, dated the Closing Date and addressed to the Representatives,
with respect to the issuance and sale of the Securities, the
Registration Statement, the Prospectus (together with any supplement
thereto) and other related matters as the Representatives may
reasonably require, and the Company shall have furnished to such
counsel such documents as they request for the purpose of enabling them
to pass upon such matters.
(d) The Company shall have furnished to the
Representatives a certificate of the Company, signed by the Chairman of
the Board or the President and the principal financial or accounting
officer of the Company, dated the Closing Date, to the effect that the
signers of such certificate have carefully examined the Registration
Statement, the Prospectus, any supplements to the Prospectus and this
Agreement and that: (i) as of the Effective Date, the statements made
in the Registration Statement and the Prospectus were true and correct
and neither the Registration Statement nor the Prospectus omitted to
state any material fact required to be stated therein or necessary in
order to make the statements therein, respectively, not misleading,
(ii) since the Effective Date, no event has occurred which should have
been set forth in a supplement or amendment to the Prospectus which has
not been set forth in such a supplement or amendment, (iii) since the
respective dates as of which information is given in the Registration
Statement in the form in which it originally became effective and in
any Prospectus, there has not been any
17
First Union Securities, Inc.
February 1, 2001
Page 17
material adverse change or any development involving a prospective
material adverse change in or affecting the business, properties,
financial condition or results of operations of the Company and its
subsidiaries, taken as a whole, whether or not arising from
transactions in the ordinary course of business, and, since such dates,
except in the ordinary course of business, neither the Company nor any
of its subsidiaries has entered into any material transaction not
referred to in the Registration Statement in the form in which it
originally became effective or in any Prospectus, (iv) neither the
Company nor any of its subsidiaries has any material contingent
obligations which are not disclosed in the Registration Statement and
the Prospectus, (v) there are not any pending or known threatened legal
proceedings to which the Company or any of its subsidiaries is a party
or of which property of the Company or any of its subsidiaries is the
subject which are material and which are not disclosed in the
Registration Statement and the Prospectus, (vi) there are not any
franchises, contracts, leases or other documents which are required to
be described in the Registration Statement or filed as exhibits to the
Registration Statement which have not been described or filed as
required, and (vii) the representations and warranties of the Company
herein are true and correct in all material respects as of the Closing
Date or any later date on which Option Stock is to be purchased, as the
case may be.
(e) At the Execution Time and at the Closing Date, KPMG
LLP shall have furnished to the Representatives letters, dated
respectively as of the Execution Time and as of the Closing Date, in
form and substance satisfactory to the Representatives, confirming that
they are independent public accountants with respect to the Company
within the meaning of the Act and the applicable published rules and
regulations thereunder and stating in effect that:
(i) in their opinion the audited financial
statements and financial statement schedules included or
incorporated by reference in the Registration Statement and
the Prospectus and reported on by them comply as to form in
all material respects with the applicable accounting
requirements of the Act and the Exchange Act and the related
published rules and regulations;
(ii) on the basis of a reading of the amounts
included or incorporated in the Registration Statement and the
Prospectus in response to Item 301 of Regulation S-K and a
reading of the latest unaudited financial statements made
available by the Company and its Subsidiaries; their limited
review, in accordance with standards established under
Statement on Auditing Standards No. 71, of the unaudited
interim financial information for the nine-month period ended
October 1, 2000, and as of October 1, 2000; carrying out
certain specified procedures (but not an examination in
accordance with generally accepted auditing standards) which
would not necessarily reveal matters of significance with
respect to the comments set forth in such letter; a reading of
the minutes of the meetings of the stockholders, directors and
committees of the Board of Directors of the Company and the
Subsidiaries; and inquiries of certain officials of the
Company who have responsibility for financial and accounting
matters of the Company and its Subsidiaries as to transactions
and events subsequent to December 31, 2000, nothing came to
their attention which caused them to believe that:
18
First Union Securities, Inc.
February 1, 2001
Page 18
(1) the amounts in the "Selected
Financial Data," if any, included or incorporated in
the Registration Statement and the Prospectus do not
agree with the corresponding amounts in the audited
financial statements from which such amounts were
derived;
(2) any unaudited financial statements
included or incorporated by reference in the
Registration Statement and the Prospectus do not
comply as to form in all material respects with
applicable accounting requirements of the Act and
with the published rules and regulations of the
Commission with respect to registration statements on
Form S-3 or financial statements included or
incorporated in quarterly reports on Form 10-Q under
the Exchange Act; and said unaudited financial
statements are not in conformity with generally
accepted accounting principles applied on a basis
substantially consistent with that of the audited
financial statements included or incorporated in the
Registration Statement and the Prospectus;
(3) with respect to the period
subsequent to the date of the most recent financial
statements (other than capsule information), audited
or unaudited, in or incorporated in the Registration
Statement and the Prospectus, there were any changes,
at a specified date not more than five days prior to
the date of the letter, in the long-term debt due
within one year and long-term debt (exclusive of
current portion) of the Company and its Subsidiaries
or capital stock of the Company or decreases in the
shareholders' equity of the Company and its
consolidated Subsidiaries, as compared with the
amounts shown on the most recent consolidated balance
sheet included or incorporated in the Registration
Statement and the Prospectus, or for the period from
the date of the most recent financial statements
included or incorporated in the Registration
Statement and the Prospectus to the date of the most
recently available monthly unaudited financial
information there were any decreases relating to
continuing operations, as compared with the
corresponding period in the preceding year in total
revenues or income before income taxes or in total or
per share amounts of net income of the Company and
its Subsidiaries, except in all instances for changes
or decreases set forth in such letter, in which case
the letter shall be accompanied by an explanation by
the Company as to the significance thereof unless
said explanation is not deemed necessary by the
Representatives; or
(4) the amounts included in any
unaudited "capsule" information included or
incorporated in the Registration Statement or
Prospectus do not agree with the amounts set forth in
the unaudited financial statements for the same
periods or were not determined on a basis
substantially consistent with that of the
corresponding amounts in the audited financial
statements included or incorporated in the
Registration Statement and the Prospectus;
19
First Union Securities, Inc.
February 1, 2001
Page 19
(iii) they have performed certain other specified
procedures as a result of which they determined that certain
information of an accounting, financial or statistical nature
(which is limited to accounting, financial or statistical
information derived from the general accounting records of the
Company and its Subsidiaries) set forth in the Registration
Statement and the Prospectus, including the information
included or incorporated in items 1, 2, 5, 6, 7, 7A, 11 and 12
of the Company's Annual Report on Form 10-K, incorporated in
the Registration Statement and the Prospectus and the
information included in the "Management's Discussion and
Analysis of Financial Condition and Results of Operation"
included or incorporated in the Company's Quarterly Reports on
Form 10-Q incorporated in the Registration Statement and the
Prospectus, agrees with the accounting records of the Company
and its Subsidiaries, excluding any questions of legal
interpretation.
References to the Prospectus in this paragraph (e) include any
supplement thereto at the date of the letter.
(f) Subsequent to the Execution Time or, if earlier, the
dates as of which information is given in the Registration Statement
and the Prospectus, there shall not have been (i) any change or
decrease specified in the letter or letters referred to in paragraph
(e) of this Section 6 or (ii) any change, or any development involving
a prospective change, in or affecting the condition (financial or
otherwise), earnings, business or properties of the Company and its
subsidiaries taken as a whole, whether or not arising from transactions
in the ordinary course of business, except as set forth in or
contemplated in the Prospectus the effect of which, in any case
referred to in clause (i) or (ii) above, is, in the sole judgment of
the Representatives, so material and adverse as to make it impractical
or inadvisable to proceed with the offering or delivery of the
Securities as contemplated by the Registration Statement and the
Prospectus.
(g) Prior to the Closing Date, the Company shall have
furnished to the Representatives such further information, certificates
and documents as the Representatives may reasonably request.
If any of the conditions specified in this Section 6 shall not have
been fulfilled in all material respects when and as provided in this Agreement,
or if any of the opinions and certificates mentioned above or elsewhere in this
Agreement shall not be in all material respects reasonably satisfactory in form
and substance to the Representatives and counsel for the Underwriters, this
Agreement and all obligations of the Underwriters hereunder may be canceled at,
or at any time prior to, the Closing Date by the Representatives. Notice of such
cancellation shall be given to the Company in writing or by telephone or
facsimile confirmed in writing.
The documents required to be delivered by this Section 6 shall be
delivered at the office of Xxxxx, Xxxxxxxx & Xxxxxxx, LLP, counsel for the
Underwriters, at 0000 Xxxxxxxxx Xxxxxx, Xxxxx 0000, Xxxxxxx, Xxxxxxx 00000-0000,
on the Closing Date.
20
First Union Securities, Inc.
February 1, 2001
Page 20
7. Reimbursement of Underwriters' Expenses. If the sale of the
Securities provided for herein is not consummated because any condition to the
obligations of the Underwriters set forth in Section 6 hereof is not satisfied,
because of any termination pursuant to subsection (i) of Section 10 hereof or
because of any refusal, inability or failure on the part of the Company to
perform any agreement herein or comply with any provision hereof other than by
reason of a default by any of the Underwriters, the Company will reimburse the
Underwriters severally through the Representative on demand for all
out-of-pocket expenses (including reasonable fees and disbursements of counsel)
that shall have been incurred by them in connection with the proposed purchase
and sale of the Securities.
8. Indemnification and Contribution.
(a) The Company agrees to indemnify and hold harmless
each Underwriter, the directors, officers, employees and agents of each
Underwriter and each person who controls any Underwriter within the
meaning of either the Act or the Exchange Act against any and all
losses, claims, damages or liabilities, joint or several, to which such
indemnified parties or any of them may become subject under the Act,
the Exchange Act or other federal or state statutory law or regulation,
at common law or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based
upon any untrue statement or alleged untrue statement of a material
fact contained in the Registration Statement as originally filed or in
any amendment thereof, or in any Preliminary Prospectus or the
Prospectus, or in any amendment thereof or supplement thereto, or arise
out of or are based upon the omission or alleged omission to state
therein a material fact required to be stated therein or necessary to
make the statements therein not misleading, and agrees to reimburse
each such indemnified party, as incurred, for any legal or other
expenses reasonably incurred by them in connection with investigating
or defending any such loss, claim, damage, liability or action;
provided, however, that the Company will not be liable in any such case
to the extent that any such loss, claim, damage or liability arises out
of or is based upon any such untrue statement or alleged untrue
statement or omission or alleged omission made therein in reliance upon
and in conformity with written information furnished to the Company by
or on behalf of any Underwriter through the Representatives
specifically for inclusion therein; provided, however, that the
indemnification contained in this paragraph (a) with respect to the
Registration Statement or the Preliminary Prospectus or the Prospectus
shall not inure to the benefit of any Underwriter on account of any
such loss, claim, damage, liability or expense arising from the sale of
Securities by such Underwriter to any person if a copy of the
Prospectus shall not have been delivered or sent to such person within
the time required by the Act and the regulations thereunder, and the
untrue statement or alleged untrue statement or omission or alleged
omission of a material fact contained in the Registration Statement or
the Preliminary Prospectus or the Prospectus was corrected in the
Prospectus, provided that the Company has delivered the Prospectus to
the several Underwriters in requisite quantity on a timely basis to
permit such delivery or sending. This indemnity agreement will be in
addition to any liability which the Company may otherwise have.
(b) Each Underwriter severally and not jointly agrees to
indemnify and hold harmless the Company, each of its directors, each of
its officers who signs the Registration
21
First Union Securities, Inc.
February 1, 2001
Page 21
Statement, and each person who controls the Company within the meaning
of either the Act or the Exchange Act, to the same extent as the
foregoing indemnity from the Company to each Underwriter, but only with
reference to written information relating to such Underwriter furnished
to the Company by or on behalf of such Underwriter through the
Representatives specifically for inclusion in the documents referred to
in the foregoing indemnity. This indemnity agreement will be in
addition to any liability which any Underwriter may otherwise have. The
Company acknowledges that the statements set forth in the last
paragraph of the cover page regarding delivery of the Securities, and,
under the heading "Underwriting" or "Plan of Distribution", (i) the
sentences related to concessions and reallowances and (ii) the
paragraph related to stabilization, syndicate covering transactions and
penalty bids in any Preliminary Prospectus and the Prospectus
constitute the only information furnished in writing by or on behalf of
the several Underwriters for inclusion in any Preliminary Prospectus or
the Prospectus.
(c) Promptly after receipt by an indemnified party under
this Section 8 of notice of the commencement of any action, such
indemnified party will, if a claim in respect thereof is to be made
against the indemnifying party under this Section 8, notify the
indemnifying party in writing of the commencement thereof; but the
failure so to notify the indemnifying party (i) will not relieve it
from liability under paragraph (a) or (b) above unless and to the
extent it did not otherwise learn of such action and such failure
results in the forfeiture by the indemnifying party of substantial
rights and defenses and (ii) will not, in any event, relieve the
indemnifying party from any obligations to any indemnified party other
than the indemnification obligation provided in paragraph (a) or (b)
above. The indemnifying party shall be entitled to appoint counsel of
the indemnifying party's choice at the indemnifying party's expense to
represent the indemnified party in any action for which indemnification
is sought (in which case the indemnifying party shall not thereafter be
responsible for the fees and expenses of any separate counsel retained
by the indemnified party or parties except as set forth below);
provided, however, that such counsel shall be satisfactory to the
indemnified party. Notwithstanding the indemnifying party's election to
appoint counsel to represent the indemnified party in an action, the
indemnified party shall have the right to employ separate counsel
(including local counsel), and the indemnifying party shall bear the
reasonable fees, costs and expenses of such separate counsel if (i) the
use of counsel chosen by the indemnifying party to represent the
indemnified party would present such counsel with a conflict of
interest, (ii) the actual or potential defendants in, or targets of,
any such action include both the indemnified party and the indemnifying
party and the indemnified party shall have reasonably concluded that
there may be legal defenses available to it and/or other indemnified
parties which are different from or additional to those available to
the indemnifying party, (iii) the indemnifying party shall not have
employed counsel satisfactory to the indemnified party to represent the
indemnified party within a reasonable time after notice of the
institution of such action or (iv) the indemnifying party shall
authorize the indemnified party to employ separate counsel at the
expense of the indemnifying party. An indemnifying party will not,
without the prior written consent of the indemnified parties, settle or
compromise or consent to the entry of any judgment with respect to any
pending or threatened claim, action, suit or proceeding in respect of
which indemnification or contribution may be sought hereunder (whether
or not the indemnified parties are actual or potential parties to such
claim or action) unless such
22
First Union Securities, Inc.
February 1, 2001
Page 22
settlement, compromise or consent includes an unconditional release of
each indemnified party from all liability arising out of such claim,
action, suit or proceeding.
(d) In the event that the indemnity provided in paragraph
(a) or (b) of this Section 8 is unavailable to or insufficient to hold
harmless an indemnified party for any reason, the Company and the
Underwriters severally agree to contribute to the aggregate losses,
claims, damages and liabilities (including legal or other expenses
reasonably incurred in connection with investigating or defending same)
(collectively "Losses") to which the Company and one or more of the
Underwriters may be subject in such proportion as is appropriate to
reflect the relative benefits received by the Company on the one hand
and by the Underwriters on the other from the offering of the
Securities; provided, however, that in no case shall any Underwriter
(except as may be provided in any agreement among underwriters relating
to the offering of the Securities) be responsible for any amount in
excess of the underwriting discount or commission applicable to the
Securities purchased by such Underwriter hereunder. If the allocation
provided by the immediately preceding sentence is unavailable for any
reason, the Company and the Underwriters severally shall contribute in
such proportion as is appropriate to reflect not only such relative
benefits but also the relative fault of the Company on the one hand and
of the Underwriters on the other in connection with the statements or
omissions which resulted in such Losses as well as any other relevant
equitable considerations. Benefits received by the Company shall be
deemed to be equal to the total net proceeds from the offering (before
deducting expenses) received by it, and benefits received by the
Underwriters shall be deemed to be equal to the total underwriting
discounts and commissions, in each case as set forth on the cover page
of the Prospectus. Relative fault shall be determined by reference to,
among other things, whether any untrue or any alleged untrue statement
of a material fact or the omission or alleged omission to state a
material fact relates to information provided by the Company on the one
hand or the Underwriters on the other, the intent of the parties and
their relative knowledge, access to information and opportunity to
correct or prevent such untrue statement or omission. The Company and
the Underwriters agree that it would not be just and equitable if
contribution were determined by pro rata allocation or any other method
of allocation which does not take account of the equitable
considerations referred to above. Notwithstanding the provisions of
this paragraph (d), no person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. For purposes of this Section 8, each person who
controls an Underwriter within the meaning of either the Act or the
Exchange Act and each director, officer, employee and agent of an
Underwriter shall have the same rights to contribution as such
Underwriter, and each person who controls the Company within the
meaning of either the Act or the Exchange Act, each officer of the
Company who shall have signed the Registration Statement and each
director of the Company shall have the same rights to contribution as
the Company, subject in each case to the applicable terms and
conditions of this paragraph (d).
9. Default by an Underwriter. If any one or more Underwriters
shall fail or refuse (otherwise than for a reason sufficient to justify the
termination of this Agreement under the provisions of Section 6 or 10 hereof) to
purchase and pay for any of the Securities agreed to be purchased by such
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First Union Securities, Inc.
February 1, 2001
Page 23
Underwriter or Underwriters hereunder and such failure to purchase shall
constitute a default in the performance of its or their obligations under this
Agreement, the Company shall immediately give notice thereof to you, and the
remaining Underwriters shall have the right, within 24 hours after the receipt
by you of such notice, to purchase or procure one or more other Underwriters to
purchase, in such proportions as may be agreed upon between you and such
purchasing Underwriter or Underwriters and upon the terms herein set forth, all
or any part of the Securities which such defaulting Underwriter or Underwriters
agreed to purchase. If the non-defaulting Underwriters fail so to make such
arrangements with respect to all such securities, the non-defaulting
Underwriters shall be obligated severally to take up and pay for (in the
respective proportions which the amount of Securities set forth opposite their
names in Schedule I hereto bears to the aggregate amount of Securities set forth
opposite the names of all the remaining Underwriters) the Securities which the
defaulting Underwriter or Underwriters agreed but failed to purchase; provided,
however, that in the event that the aggregate amount of Securities which the
defaulting Underwriter or Underwriters agreed but failed to purchase shall
exceed 10% of the aggregate amount of Securities set forth in Schedule I hereto,
the remaining Underwriters shall have the right to purchase all, but shall not
be under any obligation to purchase any, of the Securities, and if such
nondefaulting Underwriters do not purchase all the Securities, this Agreement
will terminate without liability to any nondefaulting Underwriter or the
Company. In the event of a default by any Underwriter as set forth in this
Section 9, the Closing Date shall be postponed for such period, not exceeding
five Business Days, as the Representatives shall determine in order that the
required changes in the Registration Statement and the Prospectus or in any
other documents or arrangements may be effected. Nothing contained in this
Agreement shall relieve any defaulting Underwriter of its liability, if any, to
the Company and any nondefaulting Underwriter for damages occasioned by its
default hereunder.
10. Termination. This Agreement shall be subject to termination in
the absolute discretion of the Representatives, by notice given to the Company
prior to delivery of and payment for the Securities, if at any time prior to
such time (i) trading in the Company's Common Stock shall have been suspended by
the Commission or the Nasdaq National Market, (ii) trading in securities
generally on the New York Stock Exchange or the Nasdaq National Market shall
have been suspended or limited or minimum prices shall have been established on
either of such Exchange or National Market, (iii) a banking moratorium shall
have been declared either by federal or New York State authorities, (iv) there
shall have occurred any outbreak or escalation of hostilities, declaration by
the United States of a national emergency or war or other calamity or crisis the
effect of which on financial markets is such as to make it, in the sole judgment
of the Representatives, impractical or inadvisable to proceed with the offering
or delivery of the Securities as contemplated by the Prospectus or (v) any
action shall have been taken by any federal, state or local government or agency
in respect of its monetary or fiscal affairs which in the Underwriters'
reasonable opinion has a material adverse effect on the securities markets in
the United States. If this Agreement is terminated pursuant to this Section 10,
there shall be no liability of the Company to the Underwriters and no liability
of the Underwriters to the Company; provided, however, that in the event of any
such termination, the Company agrees to indemnify and hold harmless the
Underwriters from all costs and expenses incident to the performance of the
obligations of the Company under this Agreement, including all costs and
expenses referred to in paragraph (g) of Section 5 hereof.
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First Union Securities, Inc.
February 1, 2001
Page 24
11. Representations and Indemnities to Survive. The respective
agreements, representations, warranties, indemnities and other statements of the
Company or its officers and of the Underwriters set forth in or made pursuant to
this Agreement will remain in full force and effect, regardless of any
investigation made by or on behalf of any Underwriter or the Company or any of
the officers, directors or controlling persons referred to in Section 8 hereof,
and will survive delivery of and payment for the Securities. The provisions of
Section 7 and 8 hereof shall survive the termination or cancellation of this
Agreement.
12. Notices. All communications hereunder will be in writing and
effective only on receipt, and, if sent to the Representatives, will be mailed,
delivered or telefaxed to First Union Securities, Inc. (fax no.: (000) 000-0000)
and confirmed to the General Counsel, First Union Corporation, 000 Xxxxx Xxxxxxx
Xxxxxx, Xxxxxxxxx, Xxxxx Xxxxxxxx 00000, Attention: General Counsel; and Xxxxx,
Xxxxxxxx & Xxxxxxx, LLP, 0000 Xxxxxxxxx Xxxxxx, XX, Xxxxx 0000, Xxxxxxx, Xxxxxxx
00000-0000, Attention: Xxxxxx Xxx Xxxxxxxx, Esq.; or, if sent to the Company,
will be mailed, delivered or telefaxed to (000) 000-0000 and confirmed to it at
0000 Xxxxxxx Xxxx, Xxxxxxxx 000, Xxxxxxx, Xxxxxxx 00000, Attention: General
Counsel.
13. Successors. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective successors and the officers
and directors and controlling persons referred to in Section 8 hereof, and no
other person will have any right or obligation hereunder.
14. Applicable Law. This Agreement will be governed by and
construed in accordance with the laws of the State of Georgia applicable to
contracts made and to be performed within the State of Georgia.
15. Counterparts. This Agreement may be signed in one or more
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same agreement.
16. Headings. The section headings used herein are for convenience
only and shall not affect the construction hereof.
17. Definitions. The terms which follow, when used in this
Agreement, shall have the meanings indicated.
"Act" shall mean the Securities Act of 1933, as amended, and
the rules and regulations of the Commission promulgated thereunder.
"Business Day" shall mean any day other than a Saturday, a
Sunday or a legal holiday or a day on which banking institutions or
trust companies are authorized or obligated by law to close in New York
City.
"Commission" shall mean the Securities and Exchange
Commission.
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First Union Securities, Inc.
February 1, 2001
Page 25
"Effective Date" shall mean each date and time that the
Registration Statement, any post-effective amendment or amendments
thereto and any Rule 462(b) Registration Statement became or become
effective.
"Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended, and the rules and regulations of the Commission promulgated
thereunder.
"Execution Time" shall mean the date and time that this
Agreement is executed and delivered by the parties hereto.
"Material Adverse Effect" shall have the meaning set forth in
paragraph 1(c) hereof.
"Preliminary Prospectus" shall mean any preliminary prospectus
referred to in paragraph 1(a) above and any preliminary prospectus
included in the Registration Statement at the Effective Date that omits
Rule 430A Information.
"Prospectus" shall mean the final prospectus and any
prospectus supplement relating to the Securities that is filed pursuant
to Rule 424(b) or (c) after the Execution Time or, if no filing
pursuant to Rule 424(b) or (c) is required, shall mean the form of
final prospectus relating to the Securities included in the
Registration Statement at the Effective Date.
"Registration Statement" shall mean the registration statement
referred to in paragraph 1(a) above, including exhibits, financial
statements and documents incorporated therein by reference pursuant to
Form S-3 under the Act, as amended at the Execution Time and, in the
event any post-effective amendment thereto or any Rule 462(b)
Registration Statement becomes effective prior to the Closing Date,
shall also mean such registration statement as so amended or such Rule
462(b) Registration Statement, as the case may be. Such term shall
include any Rule 430A Information deemed to be included therein at the
Effective Date as provided by Rule 430A.
"Rule 424," "Rule 430A," and "Rule 462" refer to such rules
under the Act.
"Rule 430 Information" shall mean information with respect to
the Securities and the offering thereof permitted to be omitted from
the Registration Statement when it becomes effective pursuant to Rule
430A.
"Rule 462 Registration Statement" shall mean a registration
statement and any amendments thereto filed pursuant to Rule 462
relating to the offering covered by the initial registration statement.
26
First Union Securities, Inc.
February 1, 2001
Page 26
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicate hereof, whereupon
this letter and your acceptance shall represent a binding agreement among the
Company and the several Underwriters.
Very truly yours,
RARE HOSPITALITY INTERNATIONAL, INC.
By: /s/ Xxxx X. Xxxxxxx
----------------------------------
Name: Xxxx X. Xxxxxxx
Title: Executive Vice President
The foregoing Agreement is hereby
confirmed and accepted as of the
date first above written.
FIRST UNION SECURITIES, INC.
By: /s/ Xxxxxxx X. Xxxxxxxx
-----------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: Managing Director
27
SCHEDULE I
NUMBER OF
UNDERWRITTEN
SECURITIES TO BE
UNDERWRITERS PURCHASED
------------ ----------------
First Union Securities, Inc.......................... $ 2,000,000
------------
Total................... $ 2,000,000
============
28
SCHEDULE II
TO THE UNDERWRITING AGREEMENT
"INACTIVE SUBSIDIARIES"
The Capital Grille of Xxxxxxx Hills, Inc. California
The Capital Grille of Las Vegas, Inc. Nevada
The Capital Grille of New York, Inc. New York
The Capital Grille of San Francisco, Inc. California
The Capital Grille of Scottsdale, Inc. Arizona
Bugaboo Creek of Abington, Inc. Pennsylvania
Bugaboo Creek of East Longmeadow, Inc. Massachusetts
Bugaboo Creek of Hicksville, Inc. New York
Bugaboo Creek of Norwood, Inc. Massachusetts
Bugaboo Creek of Virginia, Inc. Virginia
Bugaboo Creek of West Orange, Inc. New Jersey
Bugaboo Creek of Seekonk, Inc. Massachusetts
Bugaboo Creek of Manchester, Inc. New Hampshire
LSI-Xxxxx Partners Florida
LSI-Xxxxx Partners II Florida
LSI-Xxxxx Partners III Georgia
0000 Xxxxxxx Xxxx. Limited Partnership Georgia
0000 Xxxxxxxxxx Xxxx Xxxxxxx Xxxxxxxxxxx Xxxxxxx
00000 Causeway Blvd. Limited Partnership Georgia
0000 Xxxxx Xxxxxxx Xxxxxx Xxxxxxx Xxxxxxxxxxx Xxxxxxx
00000 Emerald Coast Parkway Limited Partnership Georgia
17211 South Park Center Limited Partnership Georgia
00000 Xxxxxxxxxxx Xxxx Limited Partnership Georgia
000 Xxxxxxxx Xxxx. Limited Partnership Georgia
000 Xxxxxxx Xxxx Xxxx Limited Partnership Georgia
6035 Blazer Limited Partnership Georgia
000 Xxxxxxxxx Xxxxxxx Xxxxxxxxxxx Xxxxxxx