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Exhibit 1
Draft-May 8, 1997
CMP MEDIA INC.
CLASS A COMMON STOCK
(PAR VALUE $.01 PER SHARE)
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UNDERWRITING AGREEMENT
(U.S. VERSION)
, 1997
Xxxxxxx, Xxxxx & Co.,
Lazard Freres & Co. LLC,
Bear, Xxxxxxx & Co. Inc.
Xxxxxx Xxxx LLC,
As representatives of the several Underwriters
named in Schedule I hereto,
c/o Goldman, Xxxxx & Co.,
00 Xxxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000.
Ladies and Gentlemen:
CMP Media Inc., a Delaware corporation (the "Company"), proposes,
subject to the terms and conditions stated herein, to issue and sell to the
Underwriters named in Schedule I hereto (the "Underwriters") an aggregate of
shares and, at the election of the Underwriters, up to
additional shares of Class A Common Stock (par value $ .01 per share)
("Stock") of the Company and the stockholders of the Company named in Schedule
II hereto (the "Selling Stockholders") propose, subject to the terms and
conditions stated herein, to sell to the Underwriters an aggregate of
shares of Stock. The aggregate of shares to be sold by the Company
and the Selling Stockholders is herein called the "Firm Shares" and the
aggregate of additional shares to be sold by the Company is herein called the
"Optional Shares". The Firm Shares and the Optional Shares that the
Underwriters elect to purchase pursuant to Section 2 hereof are herein
collectively called the "Shares".
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It is understood and agreed to by all parties that the Company and the
Selling Stockholders are concurrently entering into an agreement (the
"International Underwriting Agreement") providing for the sale by the Company
and the Selling Stockholders of up to a total of _______shares of Stock (the
"International Shares"), including the overallotment option thereunder, through
arrangements with certain underwriters outside the United States (the
"International Underwriters"), for whom Xxxxxxx Sachs International, Lazard
Capital Markets, Bear, Xxxxxxx International Limited and Xxxxxx Xxxx LLC are
acting as lead managers. Anything herein or therein to the contrary
notwithstanding, the respective closings under this Agreement and the
International Underwriting Agreement are hereby expressly made conditional on
one another. The Underwriters hereunder and the International Underwriters are
simultaneously entering into an Agreement between U.S. and International
Underwriting Syndicates (the "Agreement between Syndicates") which provides,
among other things, for the transfer of shares of Stock between the two
syndicates. Two forms of prospectus are to be used in connection with the
offering and sale of shares of Stock contemplated by the foregoing, one relating
to the Shares hereunder and the other relating to the International Shares. The
latter form of prospectus will be identical to the former except for the front,
inside front and back cover pages, the "Certain United States Tax Consequences
to Non-United States Holders" section (which is included in the international
prospectus only) and the "Underwriting" section. Except as used in Sections 2,
3, 4, 9 and 11 herein, and except as the context may otherwise require,
references hereinafter to the Shares shall include all the shares of Stock which
may be sold pursuant to either this Agreement or the International Underwriting
Agreement, and references herein to any prospectus whether in preliminary or
final form, and whether as amended or supplemented, shall include both the U.S.
and the international versions thereof.
1. (a) The Company represents and warrants to, and agrees with, each of
the Underwriters that:
(i) A registration statement on Form S-1 (File No. 333- ) (the
"Initial Registration Statement") in respect of the Shares has been
filed with the Securities and Exchange Commission (the "Commission");
the Initial Registration Statement and any post-effective amendment
thereto, each in the form heretofore delivered to you, and, excluding
exhibits thereto, to you for each of the other Underwriters, have been
declared effective by the Commission in such form; other than a
registration statement, if any, increasing the size of the offering (a
"Rule 462(b) Registration Statement"), pursuant to Rule 462(b) under
the Securities Act of 1933, as amended (the "Act"), which became or
will become effective upon filing with the Commission, no other
document with respect to the Initial Registration Statement (including
any pre-effective amendment) or the Rule 462(b)
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Registration Statement has heretofore been filed with the Commission;
no stop order suspending the effectiveness of the Initial Registration
Statement, any post-effective amendment thereto or the Rule 462(b)
Registration Statement, if any, has been issued and no proceeding for
that purpose has been initiated or threatened by the Commission (any
preliminary prospectus included in the Initial Registration Statement
or filed with the Commission pursuant to Rule 424(a) of the rules and
regulations of the Commission under the Act, is hereinafter called a
"Preliminary Prospectus"; the various parts of the Initial Registration
Statement and the Rule 462(b) Registration Statement, if any, including
all exhibits thereto and including the information contained in the
form of final prospectus filed with the Commission pursuant to Rule
424(b) under the Act in accordance with Section 5(a) hereof and deemed
by virtue of Rule 430A under the Act to be part of the Initial
Registration Statement at the time it was declared effective, each as
amended at the time such part of the Initial Registration Statement
became effective or such part of the Rule 462(b) Registration
Statement, if any, became or hereafter becomes effective, are
hereinafter collectively called the "Registration Statement"; and such
final prospectus, in the form first filed pursuant to Rule 424(b) under
the Act, is hereinafter called the "Prospectus"); and, if the Company
has filed a Rule 462(b) Registration Statement with the Commission
prior to the execution of this Agreement, the Company has either paid
to the Commission the filing fee for the Rule 462(b) Registration
Statement or given irrevocable instructions for the payment of such fee
pursuant to Rule 111(b) under the Act;
(ii) No order preventing or suspending the use of any
Preliminary Prospectus has been issued by the Commission, and each
Preliminary Prospectus, at the time of filing thereof, conformed in all
material respects to the requirements of the Act and the rules and
regulations of the Commission thereunder, and did not contain an untrue
statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein, in
the light of the circumstances under which they were made, not
misleading; provided, however, that this representation and warranty
shall not apply to any statements or omissions made in reliance upon
and in conformity with information furnished in writing to the Company
by an Underwriter through Xxxxxxx, Xxxxx & Co. expressly for use
therein;
(iii) The Registration Statement conforms, and the Prospectus
and any further amendments or supplements to the Registration Statement
or the Prospectus will conform, in all material respects to the
requirements of the Act and the rules and regulations of the Commission
thereunder; the Registration Statement and any further amendments
thereto do not and will not, as of the applicable effective date
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of the Registration Statement and any amendment thereto, contain an
untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading; the Prospectus and any further amendments or
supplements thereto do not and will not, as of the applicable filing
date of the Prospectus and any amendment or supplement thereto, contain
an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made,
not misleading; provided, however, that this representation and
warranty shall not apply to any statements or omissions made in
reliance upon and in conformity with information furnished in writing
to the Company by an Underwriter through Xxxxxxx, Sachs & Co. expressly
for use therein;
(iv) Neither the Company nor any of its subsidiaries has
sustained since the date of the latest audited financial statements
included in the Prospectus any loss or interference with its business
from fire, explosion, flood or other calamity, whether or not covered
by insurance, or from any labor dispute or court or governmental
action, order or decree, which loss or interference has had a material
adverse effect or would reasonably be expected to have a material
adverse effect on the general affairs, financial position,
stockholders' equity or consolidated results of operations of the
Company and its subsidiaries taken as a whole (a "Material Adverse
Effect"), otherwise than as set forth or contemplated in the
Prospectus; and, since the respective dates as of which information is
given in the Registration Statement and the Prospectus, there has not
been any change in the capital stock or long-term debt of the Company
or any of its subsidiaries or any material adverse change, or any
development involving a prospective material adverse change, in or
affecting the general affairs, management, financial position,
stockholders' equity or results of operations of the Company and its
subsidiaries taken as a whole, in each case, otherwise than as set
forth or contemplated in the Prospectus;
(v) The Company and its subsidiaries have good title in fee
simple to all real property and good title to all personal property
owned by them, in each case free and clear of all liens, encumbrances
and defects except such as are described in the Prospectus or as,
individually or in the aggregate, do not and would not reasonably be
expected to have a Material Adverse Effect; any real property and
buildings held under lease by the Company and its subsidiaries are held
by them under valid, subsisting and enforceable leases with such
exceptions as, individually or in the aggregate, do not and would not
reasonably be expected to have a Material Adverse Effect; and the
Company and its subsidiaries are in
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compliance with all applicable zoning laws and regulations with such
exceptions as, individually or in the aggregate, do not or would not
reasonably be expected to have a Material Adverse Effect;
(vi) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State
of Delaware, with corporate power and authority to own its properties
and conduct its business as described in the Prospectus, and has been
duly qualified as a foreign corporation for the transaction of business
and is in good standing under the laws of each other jurisdiction in
which it owns or leases properties or conducts any business so as to
require such qualification, except where the failure to be so qualified
in any such jurisdiction would not reasonably be expected to have a
Material Adverse Effect; and each subsidiary of the Company has been
duly incorporated or organized and is validly existing as a corporation
or partnership in good standing under the laws of its jurisdiction of
incorporation or organization, in each case, as the case may be;
(vii) The Company has an authorized capitalization as set
forth in the Prospectus, and all of the issued shares of capital stock
of the Company have been duly and validly authorized and issued, are
fully paid and non-assessable and conform in all material respects to
the description thereof contained in the Prospectus; and all of the
issued shares of capital stock of each subsidiary of the Company have
been duly and validly authorized and issued, are fully paid and
non-assessable and are owned directly or indirectly by the Company,
free and clear of all liens, encumbrances, equities or claims;
(viii) The unissued Shares to be issued and sold by the
Company to the Underwriters hereunder and under the International
Underwriting Agreement have been duly and validly authorized and, when
issued and delivered against payment therefor as provided herein, will
be duly and validly issued and fully paid and non-assessable and will
conform in all material respects to the description of the Stock
contained in the Prospectus;
(ix) The issue and sale of the Shares to be sold by the
Company hereunder and under the International Underwriting Agreement
and the compliance by the Company with all of the provisions of this
Agreement and the International Underwriting Agreement and the
consummation of the transactions herein and therein contemplated and of
the stock split of the Company's outstanding shares of Stock and Class
B Common Stock, as described in the Prospectus (the "Stock Split"), the
exchange of the Company's outstanding shares of Class C Common
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Stock for shares of Stock and Class B Common Stock, as the case may be,
and related amendments to the Company's Certificate of Incorporation,
as described in the Prospectus (the "Class C Exchange"), the
termination of the Company's S Corporation (as defined herein) election
and the S Corporation Distribution (as defined in the Prospectus), will
not conflict with or result in a breach or violation of any of the
terms or provisions of, or constitute a default under, any indenture,
mortgage, deed of trust, loan agreement or other agreement or
instrument to which the Company or any of its subsidiaries is a party
or by which the Company or any of its subsidiaries is bound or to which
any of the property or assets of the Company or any of its subsidiaries
is subject, nor will such action result in any violation of the
provisions of the Certificate of Incorporation or By-laws of the
Company or any statute or any order, rule or regulation of any court or
governmental agency or body having jurisdiction over the Company or any
of its subsidiaries or any of their properties except, in each case
(other than with respect to the Certificate of Incorporation or By-laws
of the Company), for such conflicts, breaches, violations or defaults
that would not, individually or in the aggregate, (x) reasonably be
expected to have a Material Adverse Effect or (y) impair the Company's
ability to perform its obligations hereunder or under the International
Underwriting Agreement; and no consent, approval, authorization, order,
registration or qualification of or with any such court or governmental
agency or body is required for the issue and sale of the Shares or the
consummation by the Company of the transactions contemplated by this
Agreement and the International Underwriting Agreement (including, but
not limited to, the Stock Split, the Class C Exchange, the termination
of the Company's S Corporation election and the S Corporation
Distribution), except the registration under the Act of the Shares, the
registration under the Securities Exchange Act of 1934, as amended (the
"Exchange Act") of the Stock and such consents, approvals,
authorizations, registrations or qualifications as may be required
under foreign or state securities or Blue Sky laws in connection with
the purchase and distribution of the Shares by the Underwriters and the
International Underwriters;
(xi) Neither the Company nor any of its subsidiaries is in
violation of its Certificate of Incorporation or By-laws or in default
in the performance or observance of any obligation, agreement, covenant
or condition contained in any indenture, mortgage, deed of trust, loan
agreement, lease or other agreement or instrument to which it is a
party or by which it or any of its properties may be bound, except
(other than with respect to the Certificate of Incorporation or By-laws
of the Company) for such defaults that would not, individually or in
the aggregate, (x) reasonably be expected to have a Material Adverse
Effect or (y)
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impair the Company's ability to perform its obligations hereunder or
under the International Underwriting Agreement;
(xii) The consolidated financial statements included in the
Registration Statement and the Prospectus, together with the related
schedules and notes, present fairly the financial position of the
Company and its subsidiaries on a consolidated basis as of the dates
indicated and the statement of operations, stockholders' equity and
cash flows of the Company and its subsidiaries on a consolidated basis
for the periods specified. Such financial statements have been prepared
in conformity with generally accepted accounting principles applied on
a consistent basis throughout the periods involved. The financial
statement schedules included in the Registration Statement present
fairly the information required to be stated therein. The summary and
selected financial data included in the Prospectus present fairly the
information shown therein and have been compiled on a basis consistent
in all material respects with that of the audited financial statements
included in the Registration Statement. The pro forma financial
information and the related notes thereto included in the Registration
Statement and the Prospectus present fairly the information shown
therein, have been prepared in accordance with the Commission's rules
and regulations with respect to pro forma financial statements and have
been compiled on the pro forma bases described therein, and the
assumptions used in the preparation thereof were reasonable at the time
made and the adjustments used therein give appropriate effect to the
transactions and circumstances referred to therein;
(xiii) The Company and its subsidiaries own, or possess all
necessary licenses or other rights to use, all patents, trademarks,
service marks, trade names, copyrights, technology, know-how and trade
secrets necessary to conduct their businesses as presently conducted or
proposed to be conducted by them as described in the Prospectus in all
material respects, and neither the Company nor any of its subsidiaries
has received any notice of or is otherwise aware of any infringement
upon or conflict with any asserted rights of others with respect to any
patents, trademarks, service marks, trade names, copyrights,
technology, know-how or trade secrets, except for such infringements or
conflicts that, individually or in the aggregate, do not or would not
reasonably be expected to have a Material Adverse Effect; and, to the
best of the Company's knowledge, the discoveries, inventions, products
or processes of the Company and its subsidiaries do not infringe upon
or conflict with any right or patent of any third party, or any
discovery, invention, product or process which is the subject of a
patent application filed by any third party, except for such
infringements or conflicts that, individually or in the
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aggregate, do not or would not reasonably be expected to have a
Material Adverse Effect;
(xiv) The Company and its subsidiaries have obtained all
permits, consents and authorizations required to be obtained by them
under applicable federal, state, local and foreign laws or regulations
in order to conduct their businesses as described in the Prospectus,
including, but not limited to, those under laws or regulations relating
to the protection of the environment or concerning the handling,
storage, disposal or discharge of toxic materials (collectively,
"Environmental Laws"), and any such permits, consents and
authorizations remain in full force and effect, except where the
failure (a) to possess any such permit, consent or authorization or (b)
of any such permit, consent or authorization to remain in full force
and effect, as the case may be, would not reasonably be expected to
have a Material Adverse Effect. The Company and its subsidiaries are in
compliance with Environmental Laws, except where the failure to so
comply would not reasonably be expected to have a Material Adverse
Effect, and there is no pending or, to the Company's knowledge,
threatened, action or proceeding against the Company or any of its
subsidiaries alleging violations of Environmental Laws, except for any
such action or proceeding that, if determined adversely to the Company
or any of its subsidiaries, would not reasonably be expected to have a
Material Adverse Effect;
(xv) There are no holders of securities (debt or equity) of
the Company or any of its subsidiaries or holders of rights (including,
without limitation, preemptive rights), warrants or options to obtain
securities of the Company or any of its subsidiaries who have the right
to request the Company or any of its subsidiaries to register
securities held by them under the Act, except as disclosed in the
Prospectus;
(xvi) The statements set forth in the Prospectus under the
caption "Description of Capital Stock", insofar as they purport to
constitute a summary of the terms of the Stock and other classes of
capital stock, and under the captions "Certain United States Tax
Consequences to Non-United States Holders," and "Certain Relationships
and Related Transactions," insofar as they purport to describe the
provisions of the laws, documents and transactions referred to therein,
are accurate and complete in all material respects;
(xvii) Other than as set forth in the Prospectus, there are no
legal or governmental proceedings pending to which the Company or any
of its subsidiaries is a party or of which any property of the Company
or any of its subsidiaries is the subject which, if determined
adversely to the Company or any of its subsidiaries,
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would, individually or in the aggregate, reasonably be expected to have
a material adverse effect on the current or future consolidated
financial position, stockholders' equity or results of operations of
the Company and its subsidiaries taken as a whole, in each case; and,
to the best of the Company's knowledge, no such proceedings are
threatened or contemplated by governmental authorities or threatened by
others;
(xviii) The Company is not and, after giving effect to the
offering and sale of the Shares, will not be an "investment company" or
an entity "controlled" by a company required to register as an
"investment company", as such terms are defined in the Investment
Company Act of 1940, as amended (the "Investment Company Act");
(xix) Coopers & Xxxxxxx L.L.P., who have certified certain
financial statements of the Company and its subsidiaries, are
independent public accountants as required by the Act and the rules and
regulations of the Commission thereunder;
(xx) The Company and its subsidiaries carry or are entitled to
the benefits of insurance covering such risks and in such amounts as
are prudent and customary in the businesses in which they are engaged;
and neither the Company nor any of its subsidiaries has any reason to
believe that they will not be able to renew their existing insurance
coverage as and when such coverage expires or to obtain similar
coverage as may be necessary to continue their businesses at a cost
that would not reasonably be expected to have a Material Adverse
Effect;
(xxi) No labor dispute with the employees of the Company or
any of its subsidiaries exists or, to the knowledge of the Company, is
imminent, that would reasonably be expected to have a Material Adverse
Effect;
(xxii) The Company's predecessor, CMP Publications, Inc.,
elected to be treated as an S corporation ("S Corporation") under
Section 1362(a) of the Internal Revenue Code of 1986, as amended (the
"Internal Revenue Code"), effective January 1, 1987, and was an S
Corporation at all times since such effective date through the date of
its merger with the Company; the Company has been an S Corporation at
all times; and except as disclosed or contemplated in the Prospectus,
no taxes have been or will be imposed on the Company in connection with
the termination of the Company's S Corporation election or the S
Corporation Distribution; and
(xxiii) Each of the Stock Split, the Class C Exchange, the
termination of the Company's S Corporation election and the S
Corporation Distribution has been
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duly and validly authorized by the Company, and each of the Stock Split
and the Class C Exchange has occurred.
(b) Each of the Selling Stockholders severally and not jointly
represents and warrants to, and agrees with, each of the Underwriters and the
Company that:
(i) All consents, approvals, authorizations and orders
necessary for the execution and delivery by such Selling Stockholder of
this Agreement, the International Underwriting Agreement, the Power of
Attorney and the Custody Agreement hereinafter referred to, and for the
sale and delivery of the Shares to be sold by such Selling Stockholder
hereunder and under the International Underwriting Agreement, have been
obtained, except for the registration under the Act of the Shares, the
registration under the Exchange Act of the Stock and such consents,
approvals, authorizations, registrations or qualifications as may be
required under foreign or state securities or Blue Sky laws in
connection with the purchase and distribution of the Shares by the
Underwriters and the International Underwriters, in each case as to
which such Selling Stockholder makes no representation or warranty; and
such Selling Stockholder has full right, power and authority to enter
into this Agreement, the International Underwriting Agreement, the
Power of Attorney and the Custody Agreement and to sell, assign,
transfer and deliver the Shares to be sold by such Selling Stockholder
hereunder and under the International Underwriting Agreement;
(ii) The sale of the Shares to be sold by such Selling
Stockholder hereunder and under the International Underwriting
Agreement and the compliance by such Selling Stockholder with all of
the provisions of this Agreement, the International Underwriting
Agreement, the Power of Attorney and the Custody Agreement and the
consummation of the transactions herein and therein contemplated will
not conflict with or result in a breach or violation of any of the
terms or provisions of, or constitute a default under, any statute,
indenture, mortgage, deed of trust, loan agreement or other agreement
or instrument to which such Selling Stockholder is a party or by which
such Selling Stockholder is bound, or to which any of the property or
assets of such Selling Stockholder is subject, nor will such action
result in any violation of the provisions of the constituent documents
of such Selling Stockholder if such Selling Stockholder is other than
an individual or any statute or any order, rule or regulation of any
court or governmental agency or body having jurisdiction over such
Selling Stockholder or the property of such Selling Stockholder,
except, in each case (other than with respect to the constituent
documents of such Selling Stockholder, if applicable), for (x) such
conflicts, breaches, violations or defaults that, individually or in
the aggregate, would not
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impair such Selling Stockholder's ability to perform its obligations
hereunder or under the International Underwriting Agreement, or (y) the
registration under the Act of the Shares, the registration under the
Exchange Act of the Stock and foreign or state securities or Blue Sky
laws (as to which such Selling Stockholder makes no representation or
warranty);
(iii) Such Selling Stockholder has, and immediately prior to
the First Time of Delivery (as defined in Section 4 hereof) such
Selling Stockholder will have, good and valid title to the Shares to be
sold by such Selling Stockholder hereunder and under the International
Underwriting Agreement, free and clear of all liens, encumbrances,
equities or claims; and, upon delivery of such Shares and payment
therefor pursuant hereto and thereto, good and valid title to such
Shares, free and clear of all liens, encumbrances, equities or claims,
will pass to the several Underwriters or the International
Underwriters, as the case may be (assuming that the Underwriters and
the International Underwriters are without notice of any adverse claim,
as defined in Uniform Commercial Code as adopted in the State of New
York (the "Code"), and are otherwise bona fide purchasers for the
purposes of the Code and that such Underwriters' and International
Underwriters' rights are not limited by subsection (4) of Section 8-302
of the Code);
(iv) During the period beginning from the date hereof and
continuing to and including the date 180 days after the date of the
Prospectus, such Selling Stockholder shall not offer, sell, contract to
sell or otherwise dispose of, except as provided hereunder or under the
International Underwriting Agreement, any securities of the Company
that are substantially similar to the Shares, including but not limited
to any securities that are convertible into or exchangeable for, or
that represent the right to receive, Stock or any such substantially
similar securities (other than (x) pursuant to employee stock option
and stock purchase plans existing on, or upon the conversion or
exchange of convertible or exchangeable securities outstanding as of,
the date of this Agreement or as provided in the Prospectus or (y) bona
fide gifts or sales or other dispositions of shares of any class of the
Company's common stock, in each case that are made exclusively between
or among the Selling Stockholders, members of their families, trusts
established for their benefit or their respective affiliates, provided
that in the case of the foregoing clause (y) it shall be a condition to
any such transfer that the transferee execute an agreement to the
effect set forth in this Section 1(b)(iv) in form and substance
reasonably satisfactory to Xxxxxxx, Xxxxx & Co.), without your prior
written consent;
(v) Such Selling Stockholder has not taken and will not take,
directly or indirectly, any action which is designed to or which has
constituted or which might
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reasonably be expected to cause or result in stabilization or
manipulation of the price of any security of the Company to facilitate
the sale or resale of the Shares;
(vi) 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 Preliminary
Prospectus and the Registration Statement did, and the Prospectus and
any further amendments or supplements to the Registration Statement and
the Prospectus, when they become effective or are filed with the
Commission, as the case may be, will, conform in all material respects
to the requirements of the Act and the rules and regulations of the
Commission thereunder 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;
(vii) 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 the transactions herein
contemplated, such Selling Stockholder will deliver to you prior to or
at the First Time of Delivery (as hereinafter defined) 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);
(viii) Certificates in negotiable form representing all of the
Shares to be sold by such Selling Stockholder hereunder and under the
International Underwriting Agreement have been placed in custody under
a Custody Agreement, in the form heretofore furnished to you (the
"Custody Agreement"), duly executed and delivered by such Selling
Stockholder to American Stock Transfer and Trust Company, as custodian
(the "Custodian"), and such Selling Stockholder has duly executed and
delivered a Power of Attorney, in the form heretofore furnished to you
(the "Power of Attorney"), appointing the persons indicated in Schedule
II hereto, and each of them, as such Selling Stockholder's
attorneys-in-fact (the "Attorneys-in-Fact") with authority to execute
and deliver this Agreement and the International Underwriting Agreement
on behalf of such Selling Stockholder, to determine the purchase price
to be paid by the Underwriters and the International Underwriters to
the Selling Stockholders as provided in Section 2 hereof, to authorize
the delivery of the Shares to be sold by such Selling Stockholder
hereunder and otherwise to act on behalf of such Selling Stockholder in
connection with the transactions contemplated by this
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Agreement, the International Underwriting Agreement and the Custody
Agreement; and
(ix) The Shares represented by the certificates held in
custody for such Selling Stockholder under the Custody Agreement are
subject to the interests of the Underwriters hereunder and the
International Underwriters under the International Underwriting
Agreement; the arrangements made by such Selling Stockholder for such
custody, and the appointment by such Selling Stockholder of the
Attorneys-in-Fact by the Power of Attorney, are to that extent
irrevocable; the obligations of the Selling Stockholders hereunder
shall not be terminated by operation of law, whether by the death or
incapacity of any individual Selling Stockholder or, in the case of an
estate or trust, by the death or incapacity of any executor or trustee
or the termination of such estate or trust, or in the case of a
partnership or corporation, by the dissolution of such partnership or
corporation, or by the occurrence of any other event; if any individual
Selling Stockholder or any such executor or trustee should die or
become incapacitated, or if any such estate or trust should be
terminated, or if any such partnership or corporation should be
dissolved, or if any other such event should occur, before the delivery
of the Shares hereunder, certificates representing the Shares shall be
delivered by or on behalf of such Selling Stockholder in accordance
with the terms and conditions of this Agreement, of the International
Underwriting Agreement and of the Custody Agreement; and actions taken
by the Attorneys-in-Fact pursuant to the Power of Attorney shall be as
valid as if such death, incapacity, termination, dissolution or other
event had not occurred, regardless of whether or not the Custodian, the
Attorneys-in-Fact, or any of them, shall have received notice of such
death, incapacity, termination, dissolution or other event.
2. Subject to the terms and conditions herein set forth, (a) the
Company and each of the Selling Stockholders agree, severally and not jointly,
to sell to each of the Underwriters, and each of the Underwriters agrees,
severally and not jointly, to purchase from the Company and each of the Selling
Stockholders, at a purchase price per share of $ , the number of Firm
Shares (to be adjusted by you so as to eliminate fractional shares) determined
by multiplying the aggregate number of Firm Shares to be sold by the Company and
each of the Selling Stockholders as set forth opposite their respective names in
Schedule II hereto by a fraction, the numerator of which is the aggregate number
of Firm Shares to be purchased by such Underwriter as set forth opposite the
name of such Underwriter in Schedule I hereto and the denominator of which is
the aggregate number of Firm Shares to be purchased by all of the Underwriters
from the Company and all of the Selling Stockholders hereunder and (b) in the
event and to the extent that the Underwriters shall exercise the election to
purchase Optional Shares as provided below, the Company agrees to sell to each
of the Underwriters, and each of the Underwriters agrees, severally and
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not jointly, to purchase from the Company, at the purchase price per share set
forth in clause (a) of this Section 2, that portion of the number of Optional
Shares as to which such election shall have been exercised (to be adjusted by
you so as to eliminate fractional shares) determined by multiplying such number
of Optional Shares by a fraction the numerator of which is the maximum number of
Optional Shares which such Underwriter is entitled to purchase as set forth
opposite the name of such Underwriter in Schedule I hereto and the denominator
of which is the maximum number of Optional Shares that all of the Underwriters
are entitled to purchase hereunder.
The Company hereby grants to the Underwriters the right to purchase at
their election up to Optional Shares, at the purchase price per share
set forth in the paragraph above, for the sole purpose of covering
overallotments in the sale of the Firm Shares. Any such election to purchase
Optional Shares may be exercised only by written notice from you to the Company,
given within a period of 30 calendar days after the date of this Agreement and
setting forth the aggregate number of Optional Shares to be purchased and the
date on which such Optional Shares are to be delivered, as determined by you but
in no event earlier than the First Time of Delivery (as defined in Section 4
hereof) or, unless you and the Company otherwise agree in writing, earlier than
two or later than ten business days after the date of such notice.
3. Upon the authorization by you of the release of the Firm Shares, the
several Underwriters propose to offer the Firm Shares for sale upon the terms
and conditions set forth in the Prospectus.
4. (a) The Shares to be purchased by each Underwriter hereunder, in
definitive form, and in such authorized denominations and registered in such
names as Xxxxxxx, Sachs & Co. may request upon at least forty-eight hours' prior
notice to the Company and the Selling Stockholders shall be delivered by or on
behalf of the Company and the Selling Stockholders to Xxxxxxx, Xxxxx & Co. for
the account of such Underwriter, against payment by or on behalf of such
Underwriter of the purchase price therefor by wire transfer, payable to the
order of the Company and each of the Selling Stockholders, as their interests
may appear, in Federal (same day) funds. The Company will cause the certificates
representing the Shares to be made available for checking and packaging at least
twenty-four hours prior to the Time of Delivery (as defined below) with respect
thereto at the office of Xxxxxxx, Sachs & Co., 00 Xxxxx Xxxxxx, Xxx Xxxx, Xxx
Xxxx 00000 (the "Designated Office"). The time and date of such delivery and
payment shall be, with respect to the Firm Shares, 9:30 a.m., New York City
time, on , 1997 or such other time and date as Xxxxxxx, Xxxxx & Co.
and the Company may agree upon in writing, and, with respect to the Optional
Shares, 9:30 a.m., New York City time, on the date specified by Xxxxxxx, Sachs &
Co. in the written notice given by Xxxxxxx, Xxxxx & Co. (as provided herein) of
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the Underwriters' election to purchase such Optional Shares, or such other time
and date as Xxxxxxx, Sachs & Co. and the Company may agree upon in writing (as
provided herein). Such time and date for delivery of the Firm Shares is herein
called the "First Time of Delivery", such time and date for delivery of the
Optional Shares, if not the First Time of Delivery, is herein called the "Second
Time of Delivery", and each such time and date for delivery is herein called a
"Time of Delivery".
(b) The documents to be delivered at each Time of Delivery by
or on behalf of the parties hereto pursuant to Section 7 hereof, including the
cross-receipt for the Shares and any additional documents requested by the
Underwriters pursuant to Section 7(k) hereof, will be delivered at the offices
of Debevoise & Xxxxxxxx, 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (the
"Closing Location"), and the Shares will be delivered at the Designated Office,
all at each Time of Delivery. A meeting will be held at the Closing Location at
2:00 p.m., New York City time, on the New York Business Day next preceding each
Time of Delivery, at which meeting the final drafts of the documents to be
delivered pursuant to the preceding sentence will be available for review by the
parties hereto. For the purposes of this Section 4, "New York Business Day"
shall mean each Monday, Tuesday, Wednesday, Thursday and Friday which is not a
day on which banking institutions in New York are generally authorized or
obligated by law or executive order to close.
5. The Company agrees with each of the Underwriters:
(a) To prepare the Prospectus in a form approved by you and to
file such Prospectus pursuant to Rule 424(b) under the Act not later than the
Commission's close of business on the second business day following the
execution and delivery of this Agreement, or, if applicable, such earlier time
as may be required by Rule 430A(a)(3) under the Act; to make no further
amendment or any supplement to the Registration Statement or Prospectus which
shall be disapproved by you promptly after reasonable notice thereof; to advise
you, promptly after it receives notice thereof, of the time when any amendment
to the Registration Statement has been filed or becomes effective or any
supplement to the Prospectus or any amended Prospectus has been filed and to
furnish you copies thereof; to advise you, promptly after it receives notice
thereof, of the issuance by the Commission of any stop order or of any order
preventing or suspending the use of any Preliminary Prospectus or Prospectus, of
the suspension of the qualification of the Shares for offering or sale in any
jurisdiction, of the initiation or threatening of any proceeding for any such
purpose, or of any request by the Commission for the amending or supplementing
of the Registration Statement or Prospectus or for additional information; and,
in the event of the issuance of any stop order or of any order preventing or
suspending the use of any Preliminary Prospectus or Prospectus or suspending any
such qualification, promptly to use its best efforts to obtain the withdrawal of
such order;
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(b) Promptly from time to time to take such action as you may
reasonably request to qualify the Shares for offering and sale under the
securities laws of such jurisdictions as you may request and to comply with such
laws so as to permit the continuance of sales and dealings therein in such
jurisdictions for as long as may be necessary to complete the distribution of
the Shares, provided that in connection therewith the Company shall not be
required to qualify as a foreign corporation or a dealer in securities or to
file a general consent to service of process in any jurisdiction or to subject
itself to taxation in respect of doing business in any jurisdiction in which the
Shares have been so qualified;
(c) Prior to 10:00 a.m., New York City time, on the New York
Business Day next succeeding the date of this Agreement and from time to time,
to furnish the Underwriters with copies of the Prospectus in New York City in
such quantities as you may reasonably request, and, if the delivery of a
prospectus is required at any time prior to the expiration of nine months after
the time of issue of the Prospectus in connection with the offering or sale of
the Shares and if at such time any events shall have occurred as a result of
which the Prospectus as then amended or supplemented would include an untrue
statement of a material fact or omit to state any material fact necessary in
order to make the statements therein, in the light of the circumstances under
which they were made when such Prospectus is delivered, not misleading, or, if
for any other reason it shall be necessary during such period to amend or
supplement the Prospectus in order to comply with the Act, to notify you and
upon your request to prepare and furnish without charge to each Underwriter and
to any dealer in securities as many copies as you may from time to time
reasonably request of an amended Prospectus or a supplement to the Prospectus
which will correct such statement or omission or effect such compliance, and in
case any Underwriter is required to deliver a prospectus in connection with
sales of any of the Shares at any time nine months or more after the time of
issue of the Prospectus, upon your request but at the expense of such
Underwriter, to prepare and deliver to such Underwriter as many copies as you
may request of an amended or supplemented Prospectus complying with Section
10(a)(3) of the Act and, in each case, to file such amended or supplemented
Prospectus with the Commission in accordance with Rule 424(b) under the Act;
(d) To make generally available to its security holders as
soon as practicable, but in any event not later than eighteen months after the
effective date of the Registration Statement (as defined in Rule 158(c) under
the Act), an earnings statement of the Company and its subsidiaries (which need
not be audited) complying with Section 11(a) of the Act and the rules and
regulations of the Commission thereunder (including, at the option of the
Company, Rule 158);
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(e) During the period beginning from the date hereof and
continuing to and including the date 180 days after the date of the Prospectus,
not to offer, sell, contract to sell or otherwise dispose of, except as provided
hereunder and under the International Underwriting Agreement, any securities of
the Company that are substantially similar to the Shares, including but not
limited to any securities that are convertible into or exchangeable for, or that
represent the right to receive, Stock or any such substantially similar
securities (other than (i) pursuant to employee stock option and stock purchase
plans or any non-employee director stock plan existing on, or upon the
conversion or exchange of convertible or exchangeable securities outstanding as
of, the date of this Agreement or (ii) as consideration for any acquisition by
the Company of another person provided that all recipients of securities of the
Company issued pursuant to such an acquisition execute an agreement to the
effect set forth in this Section 5(e) in form and substance reasonably
satisfactory to Xxxxxxx, Sachs & Co.), without your prior written consent;
(f) To furnish to its stockholders as soon as practicable
after the end of each fiscal year an annual report (including a balance sheet
and statements of income, stockholders' equity and cash flows of the Company and
its consolidated subsidiaries certified by independent public accountants);
(g) During a period of five years from the effective date of
the Registration Statement, to furnish to you copies of all reports or other
communications (financial or other) furnished to stockholders, and to deliver to
you (i) as soon as they are available, copies of any reports and financial
statements furnished to or filed with the Commission or any national securities
exchange on which any class of securities of the Company is listed; and (ii)
such additional information concerning the business and financial condition of
the Company as you may from time to time reasonably request (such financial
statements to be on a consolidated basis to the extent the accounts of the
Company and its subsidiaries are consolidated in reports furnished to its
stockholders generally or to the Commission);
(h) To use the net proceeds received by it from the sale of
the Shares pursuant to this Agreement and the International Underwriting
Agreement in the manner specified in the Prospectus under the caption "Use of
Proceeds";
(i) To use its best efforts to list for quotation the Shares
on NASDAQ;
(j) To file with the Commission such reports on Form SR as may
be required by Rule 463 under the Act; and
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(k) If the Company elects to rely upon Rule 462(b) and the
Rule 462(b) Registration Statement has not become effective upon filing with the
Commission prior to the execution of this Agreement, the Company shall file the
Rule 462(b) Registration Statement with the Commission in compliance with Rule
462(b) by 10:00 P.M., Washington, D.C. time, on the date of this Agreement, and
the Company shall at the time of filing either pay to the Commission the filing
fee for the Rule 462(b) Registration Statement or give irrevocable instructions
for the payment of such fee pursuant to Rule 111(b) under the Act.
6. The Company covenants and agrees with the several Underwriters that
the Company will pay or cause to be paid the following: (i) the fees,
disbursements and expenses of the Company's counsel and accountants in
connection with the registration of the Shares under the Act and all other
expenses in connection with the preparation, printing and filing of the Initial
Registration Statement, any Preliminary Prospectus, any Rule 462(b) Registration
Statement and the Prospectus and amendments and supplements thereto and the
mailing and delivering of copies thereof to the Underwriters and dealers; (ii)
the cost of printing or producing any Agreement among Underwriters, this
Agreement, the International Underwriting Agreement, the Agreement between
Syndicates, the Selling Agreements, the Blue Sky Memorandum, closing documents
(including any compilations thereof) and any other documents in connection with
the offering, purchase, sale and delivery of the Shares; (iii) all expenses in
connection with the qualification of the Shares for offering and sale under
state securities laws as provided in Section 5(b) hereof, including the
reasonable fees and disbursements of counsel for the Underwriters in connection
with such qualification and in connection with the Blue Sky survey; (iv) all
fees and expenses in connection with listing the Shares on NASDAQ; (v) the
filing fees incident to, and the reasonable fees and disbursements of counsel
for the Underwriters in connection with, securing any required review by the
National Association of Securities Dealers, Inc. of the terms of the sale of the
Shares; (vi) the cost of preparing stock certificates; (vii) the cost and
charges of any transfer agent or registrar; and (viii) all other costs and
expenses incident to the performance of its obligations hereunder which are not
otherwise specifically provided for in this Section. Each Selling Stockholder
covenants and agrees with the several Underwriters that such Selling Stockholder
will pay or cause to be paid all costs and expenses incident to the performance
of such Selling Stockholder's obligations hereunder which are not otherwise
specifically provided for in this Section, including (i) any fees and expenses
of counsel for such Selling Stockholder, (ii) such Selling Stockholder's pro
rata share of the fees and expenses of the Attorneys-in-Fact and the Custodian
and (iii) all expenses and taxes (subject to the following sentence) incident to
the sale and delivery of the Shares to be sold by such Selling Stockholder to
the Underwriters hereunder and under the International Underwriting Agreement.
In connection with Clause (iii) of the preceding sentence, Xxxxxxx, Xxxxx & Co.
agrees to pay New York State stock transfer taxes relating to the sale and
delivery of the
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Shares, and the Selling Stockholder agrees to reimburse Xxxxxxx, Sachs & Co. for
associated carrying costs if Xxxxxxx, Xxxxx & Co. has duly filed an application
for rebate of such tax payment and such tax payment is not rebated on the day of
payment and for any portion of such tax payment not rebated. It is understood,
however, that except as provided in this Section, and Sections 8 and 11 hereof,
the Underwriters will pay all of their own costs and expenses, including the
fees of their counsel, stock transfer taxes on resale of any of the Shares by
them, and any advertising expenses connected with any offers they may make.
7. The obligations of the Underwriters hereunder, as to the Shares to
be delivered at each Time of Delivery, shall be subject, in their discretion, to
the condition that all representations and warranties and other statements of
the Company and of the Selling Stockholders herein are, at and as of such Time
of Delivery, true and correct, the condition that the Company and the Selling
Stockholders shall have performed all of its and their obligations hereunder
theretofore to be performed, and the following additional conditions:
(a) The Prospectus shall have been filed with the Commission
pursuant to Rule 424(b) within the applicable time period prescribed
for such filing by the rules and regulations under the Act and in
accordance with Section 5(a) hereof; if the Company has elected to rely
upon Rule 462(b) and the Rule 462(b) Registration Statement has not
become effective upon filing with the Commission prior to the execution
of this Agreement, the Rule 462(b) Registration Statement shall have
become effective by 10:00 P.M., Washington, D.C. time, on the date of
this Agreement; no stop order suspending the effectiveness of the
Registration Statement or any part thereof shall have been issued and
no proceeding for that purpose shall have been initiated or threatened
by the Commission; and all requests for additional information on the
part of the Commission shall have been complied with to your reasonable
satisfaction;
(b) Debevoise & Xxxxxxxx, counsel for the Underwriters, shall
have furnished to you such opinion or opinions (a draft of such opinion
is attached as Annex II(a) hereto), dated such Time of Delivery, with
respect to the matters covered in paragraphs (i), (ii), (iii), (v) and
(vii) of subsection (c) below as well as such other related matters as
you may reasonably request, and such counsel shall have received such
papers and information as they may reasonably request to enable them to
pass upon such matters;
(c) Dow, Xxxxxx & Xxxxxxxxx, PLLC, counsel for the Company,
shall have furnished to you their written opinion (a draft of such
opinion is attached as Annex II(b) hereto), dated such Time of
Delivery, in form and substance reasonably satisfactory to you, to the
effect that:
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(i) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State
of Delaware, with corporate power and authority to own its properties
and conduct its business as described in the Prospectus;
(ii) The Company has an authorized capitalization as set forth
in the Prospectus, and all of the issued shares of capital stock of the
Company (including the Shares being delivered at such Time of Delivery)
have been duly and validly authorized and issued and are fully paid and
non-assessable and conform in all material respects to the description
thereof contained in the Prospectus;
(iii) This Agreement and the International Underwriting
Agreement have been duly authorized, executed and delivered by the
Company;
(iv) No consent, approval, authorization, order, registration
or qualification of or with any State of New York, Delaware or United
States Federal court or governmental agency or body is required for the
issuance and sale of the Shares or the consummation by the Company of
the transactions contemplated by this Agreement and the International
Underwriting Agreement and of the Stock Split, the Class C Exchange,
the termination of the Company's S Corporation election and the S
Corporation Distribution, except the registration under the Act of the
Shares, the registration under the Exchange Act of the Stock and such
consents, approvals, authorizations, registrations or qualifications as
may be required under foreign or state securities or Blue Sky laws in
connection with the purchase and distribution of the Shares by the
Underwriters and the International Underwriters (as to which counsel
need express no opinion);
(v) The statements set forth in the Prospectus under the
caption "Description of Capital Stock", insofar as they purport to
constitute a summary of the terms of the Stock, and under the caption
"Certain United States Tax Consequences to Non-United States Holders,"
insofar as they purport to summarize certain Federal tax laws of the
United States, are accurate and complete in all material respects;
(vi) The Company is not an "investment company" or an entity
"controlled" by a company required to register as an "investment
company", as such terms are defined in the Investment Company Act; and
(vii) Although they do not assume any responsibility for the
accuracy, completeness or fairness of the statements contained in the
Registration Statement
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or the Prospectus, except for those referred to in the opinion in
subsection (v) of this Section 7(c), in the course of the preparation
of the Registration Statement and the Prospectus by the Company, such
counsel participated in conferences with representatives of the
Company, the independent public accountants of the Company and the
representatives of the Underwriters (the "Representatives") and their
counsel, at which conferences the contents of the Registration
Statement and the Prospectus and related matters were discussed, and
without any independent investigation, check or verification of facts
for the purpose of rendering such opinion, on the basis of such
counsel's examination of the Registration Statement and the Prospectus
and such counsel's participation in the above mentioned conferences, no
facts have come to the attention of such counsel that would lead such
counsel to believe that, as of its effective date, the Registration
Statement or any further amendment thereto made by the Company prior to
such Time of Delivery (other than the financial statements, related
schedules and other financial data therein, as to which such counsel
need express no opinion) contained an untrue statement of a material
fact or omitted to state a material fact required to be stated therein
or necessary to make the statements therein not misleading; or that, as
of its date, the Prospectus or any further amendment or supplement
thereto made by the Company prior to such Time of Delivery (other than
the financial statements, related schedules and other financial data
therein, as to which such counsel need express no opinion) contained an
untrue statement of a material fact or omitted to state a material fact
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; or that, as
of such Time of Delivery, either the Registration Statement or the
Prospectus or any further amendment or supplement thereto made by the
Company prior to such Time of Delivery (other than the financial
statements, related schedules and other financial data therein, as to
which such counsel need express no opinion) contains an untrue
statement of a material fact 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; or that, as
of the effective date of the Registration Statement, the date of the
Prospectus or such Time of Delivery, either the Registration Statement
or the Prospectus or any further amendment or supplement thereto made
by the Company prior to such Time of Delivery (other than the financial
statements, related schedules and other financial data therein, as to
which such counsel need express no opinion) did not or does not, as the
case may be, comply as to form in all material respects with the
requirements of the Act and the rules and regulations thereunder; or
that any amendment to the Registration Statement is required to be
filed or any contract or other document of a character required to be
filed as an exhibit to the Registration Statement or required to be
described in the Registration Statement or the Prospectus is not filed
or described as required.
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In rendering such opinions, such counsel may state that they express no
opinion as to the laws of jurisdictions other than the law of the State of New
York, the Federal law of the United States and the General Corporation Law of
the State of Delaware, and may state that, insofar as such opinions involve
factual matters, they have relied, to the extent they deem proper, upon
certificates of officers of the Company and its subsidiaries and certificates of
public officials, provided that such counsel shall provide copies of such
certificates to you and shall state that they believe that both you and they are
justified in relying upon such certificates;
(d) Xxxxxx X. Xxxxxxxxx, General Counsel for the Company,
shall have furnished to you his written opinion (a draft of such opinion is
attached as Annex II(c) hereto), dated such Time of Delivery, in form and
substance reasonably satisfactory to you, to the effect that:
(i) The Company has been duly qualified as a foreign
corporation for the transaction of business and is in good standing
under the laws of each other jurisdiction in which it owns or leases
properties or conducts any business so as to require such
qualification, except where the failure to be so qualified in any such
jurisdiction would not reasonably be expected to have a Material
Adverse Effect (such counsel being entitled to rely in respect of the
opinion in this clause upon opinions of local counsel and in respect of
matters of fact upon certificates of officers of the Company, provided
that such counsel shall state that he believes that both you and he are
justified in relying upon such opinions and certificates);
(ii) Each subsidiary of the Company has been duly incorporated
or organized and is validly existing as a corporation or partnership in
good standing under the laws of its jurisdiction of incorporation or
organization, in each case, as the case may be; and all of the issued
shares of capital stock of each such subsidiary have been duly and
validly authorized and issued, are fully paid and non-assessable, and
are owned directly or indirectly by the Company, free and clear of all
liens, encumbrances, equities or claims (such counsel being entitled to
rely in respect of the opinion in this clause upon opinions of local
counsel and in respect of matters of fact upon certificates of public
officials and officers of the Company or its subsidiaries, provided
that such counsel shall state that they believe that both you and they
are justified in relying upon such opinions and certificates);
(iii) To the best of such counsel's knowledge and other than
as set forth in the Prospectus, there are no legal or governmental
proceedings pending to which the Company or any of its subsidiaries is
a party or of which any property of the
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Company or any of its subsidiaries is the subject which, if determined
adversely to the Company or any of its subsidiaries, would,
individually or in the aggregate, reasonably be expected to have a
material adverse effect on the current or future consolidated financial
position, stockholders' equity or results of operations of the Company
and its subsidiaries taken as a whole, in each case; and, to the best
of such counsel's knowledge, no such proceedings are threatened or
contemplated by governmental authorities or threatened by others;
(iv) The issuance and sale of the Shares being delivered at
such Time of Delivery to be sold by the Company and the compliance by
the Company with all of the provisions of this Agreement and the
International Underwriting Agreement and the consummation of the
transactions herein and therein contemplated and of the Stock Split,
the Class C Exchange, the termination of the Company's S Corporation
election and the S Corporation Distribution, will not conflict with or
result in a breach or violation of any of the terms or provisions of,
or constitute a default under, any indenture, mortgage, deed of trust,
loan agreement or other agreement or instrument known to such counsel
to which the Company or any of its subsidiaries is a party or by which
the Company or any of its subsidiaries is bound or to which any of the
property or assets of the Company or any of its subsidiaries is
subject, nor will such action result in any violation of the provisions
of the Certificate of Incorporation or By-laws of the Company or any
statute or any order, rule or regulation known to such counsel of any
court or governmental agency or body having jurisdiction over the
Company or any of its subsidiaries or any of their properties, except,
in each case (other than with respect to the Certificate of
Incorporation or By-laws of the Company), for such conflicts, breaches,
violations or defaults that would not, individually or in the
aggregate, (x) reasonably be expected to have a Material Adverse Effect
or (y) impair the Company's ability to perform its obligations
hereunder or under the International Underwriting Agreement;
(v) Neither the Company nor any of its subsidiaries is in
violation of its Certificate of Incorporation or By-laws or in default
in the performance or observance of any obligation, agreement, covenant
or condition contained in any indenture, mortgage, deed of trust, loan
agreement, lease or other agreement or instrument to which it is a
party or by which it or any of its properties may be bound, except
(other than with respect to the Certificate of Incorporation or By-laws
of the Company) for such defaults that would not, individually or in
the aggregate, (x) reasonably be expected to have a Material Adverse
Effect or (y) impair the Company's ability to perform its obligations
hereunder or under the International Underwriting Agreement;
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(vi) Each of the Stock Split, the Class C Exchange, the
termination of the Company's S Corporation election and the S
Corporation Distribution has been duly and validly authorized by the
Company, and each of the Stock Split and the Class C Exchange has
occurred; and
(vii) Although such counsel does not assume any responsibility
for the accuracy, completeness or fairness of the statements contained
in the Registration Statement or the Prospectus, in the course of the
preparation of the Registration Statement and the Prospectus by the
Company, such counsel participated in conferences with representatives
of the Company, the independent public accountants of the Company and
the Representatives and their counsel, at which conferences the
contents of the Registration Statement and the Prospectus and related
matters were discussed, and without any independent investigation,
check or verification of facts for the purpose of rendering such
opinion, on the basis of such counsel's examination of the Registration
Statement and the Prospectus and such counsel's participation in the
above mentioned conferences, no facts have come to the attention of
such counsel that would lead him to believe that, as of its effective
date, the Registration Statement or any further amendment thereto made
by the Company prior to such Time of Delivery (other than the financial
statements, related schedules and other financial data therein, as to
which such counsel need express no opinion) contained an untrue
statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading or that, as of its date, the Prospectus or any
further amendment or supplement thereto made by the Company prior to
such Time of Delivery (other than the financial statements, related
schedules and other financial data therein, as to which such counsel
need express no opinion) contained an untrue statement of a material
fact or omitted to state a material fact necessary to make the
statements therein, in the light of the circumstances under which they
were made, not misleading or that, as of such Time of Delivery, either
the Registration Statement or the Prospectus or any further amendment
or supplement thereto made by the Company prior to such Time of
Delivery (other than the financial statements, related schedules and
other financial data therein, as to which such counsel need express no
opinion) contains an untrue statement of a material fact 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 rendering such opinions, such counsel may rely, as to all matters
governed by the laws of jurisdictions other than the law of the State of New
York, the Federal law of the United States and the General Corporation Law of
the State of Delaware, upon the opinions of counsel reasonably satisfactory to
the Representatives, and may state that, insofar as such
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opinions involve factual matters, he has relied, to the extent he deems proper,
upon certificates of officers of the Company and its subsidiaries and
certificates of public officials, provided that such counsel shall provide
copies of such opinions and certificates to you and shall state that he believes
that both you and he are justified in relying upon such opinions and
certificates;
(e) Counsel for the Selling Stockholders, as indicated in
Schedule II hereto, shall have furnished to you their written opinion (a draft
of such opinion is attached as Annex II(d) hereto) with respect to each of the
Selling Stockholders, dated such Time of Delivery, in form and substance
reasonably satisfactory to you, to the effect that:
(i) A Power of Attorney and a Custody Agreement have been duly
executed and delivered by such Selling Stockholder and constitute valid
and binding agreements of such Selling Stockholder in accordance with
their terms;
(ii) This Agreement and the International Underwriting
Agreement have been duly executed and delivered by or on behalf of such
Selling Stockholder; and the sale of the Shares to be sold by such
Selling Stockholder hereunder and thereunder and the compliance by such
Selling Stockholder with all of the provisions of this Agreement and
the International Underwriting Agreement, the Power of Attorney and the
Custody Agreement and the consummation by such Selling Stockholder of
the transactions herein and therein contemplated in connection with the
Shares to be sold by such Selling Stockholder hereunder and thereunder
will not conflict with or result in a breach or violation of any terms
or provisions of, or constitute a default under, any statute,
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,
nor will such action result in any violation of the provisions of the
constituent documents of such Selling Stockholder if such Selling
Stockholder is other than an individual or any order, rule or
regulation known to such counsel of any court or governmental agency or
body having jurisdiction over such Selling Stockholder or the property
of such Selling Stockholder, except, in each case (other than with
respect to the constituent documents of such Selling Stockholder, if
applicable), for (x) such conflicts, breaches, violations or defaults
that, individually or in the aggregate, would not impair such Selling
Stockholder's ability to perform its obligations hereunder or under the
International Underwriting Agreement, or (y) the registration under the
Act of the Shares, the registration under the Exchange Act of the Stock
and foreign or state securities or Blue Sky laws (as to which such
counsel need express no opinion);
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(iii) No consent, approval, authorization or order of any
State of New York, Delaware or United States Federal court or
governmental agency or body is required for the consummation by such
Selling Stockholder of the transactions contemplated by this Agreement
and the International Underwriting Agreement in connection with the
Shares to be sold by such Selling Stockholder hereunder or thereunder,
except such as have been obtained under the Act and such as may be
required under foreign or state securities or Blue Sky laws in
connection with the purchase and distribution of such Shares by the
Underwriters or the International Underwriters (as to which such
counsel need express no opinion);
(iv) Immediately prior to such Time of Delivery such Selling
Stockholder was the sole registered owner of the Shares to be sold by
such Selling Stockholder; and such Selling Stockholder has full right,
power and authority to sell, assign, transfer and deliver the Shares to
be sold by such Selling Stockholder under this Agreement and the
International Underwriting Agreement; and
(v) Upon delivery of and payment for the Shares to be sold by
such Selling Stockholder as contemplated by this Agreement and the
International Underwriting Agreement, at the First Time of Delivery,
the Underwriters and the International Underwriters will have acquired
good and valid title to such Shares, free and clear of all liens,
encumbrances, equities or claims (assuming that the Underwriters and
the International Underwriters are without notice of any adverse claim,
as defined in the Code, and are otherwise bona fide purchasers for the
purposes of the Code and that such Underwriters' and International
Underwriters' rights are not limited by subsection (4) of Section 8-302
of the Code).
In rendering such opinions, such counsel may state that they
express no opinion as to the laws of jurisdictions other than the law of the
State of New York, the Federal law of the United States and the General
Corporation Law of the State of Delaware, and may state that, insofar as such
opinions involve factual matters, they have relied, to the extent they deem
proper, upon certificates of such Selling Stockholders and certificates of
public officials, provided that such counsel shall provide copies of such
certificates to you and shall state that they believe that both you and they are
justified in relying upon such certificates;
(f) On the date of the Prospectus at a time prior to the
execution of this Agreement, at 9:30 a.m., New York City time, on the effective
date of any post-effective amendment to the Registration Statement filed
subsequent to the date of this Agreement and also at each Time of Delivery,
Coopers & Xxxxxxx L.L.P. shall have furnished to you a letter or letters, dated
the respective dates of delivery thereof, in form and substance
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satisfactory to you, to the effect set forth in Annex I hereto (the executed
copy of the letter delivered prior to the execution of this Agreement is
attached as Annex I(a) hereto and a draft of the form of letter to be delivered
on the effective date of any post-effective amendment to the Registration
Statement and as of each Time of Delivery is attached as Annex I(b) hereto);
(g) (i) Neither the Company nor any of its subsidiaries shall
have sustained since the date of the latest audited financial statements
included in the Prospectus any loss or interference with its business from fire,
explosion, flood or other calamity, whether or not covered by insurance, or from
any labor dispute or court or governmental action, order or decree, otherwise
than as set forth or contemplated in the Prospectus, and (ii) since the
respective dates as of which information is given in the Prospectus there shall
not have been any change in the capital stock or long term debt of the Company
or any of its subsidiaries or any change, or any development involving a
prospective change, in or affecting the general affairs, management, financial
position, stockholders' equity or results of operations of the Company and its
subsidiaries taken as a whole, in each case, otherwise than as set forth or
contemplated in the Prospectus, the effect of which, in any such case described
in Clause (i) or (ii), is in the judgment of the Representatives so material and
adverse as to make it impracticable or inadvisable to proceed with the public
offering or the delivery of the Shares being delivered at such Time of Delivery
on the terms and in the manner contemplated in the Prospectus;
(h) On or after the date hereof (i) no downgrading shall have
occurred in the rating accorded the Company's debt securities or preferred stock
by any "nationally recognized statistical rating organization", as that term is
defined by the Commission for purposes of Rule 436(g)(2) under the Act, and (ii)
no such organization shall have publicly announced that it has under
surveillance or review, with possible negative implications, its rating of any
of the Company's debt securities or preferred stock;
(i) On or after the date hereof there shall not have occurred
any of the following: (i) a suspension or material limitation in trading in
securities generally on the New York Stock Exchange or on NASDAQ; (ii) a
suspension or material limitation in trading in the Company's securities on
NASDAQ; (iii) a general moratorium on commercial banking activities declared by
either Federal or New York State authorities; or (iv) the outbreak or escalation
of hostilities involving the United States or the declaration by the United
States of a national emergency or war, if the effect of any such event specified
in this Clause (iv) in the judgment of the Representatives makes it
impracticable or inadvisable to proceed with the public offering or the delivery
of the Shares being delivered at such Time of Delivery on the terms and in the
manner contemplated in the Prospectus;
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(j) The Shares to be sold by the Company and the Selling
Stockholders at such Time of Delivery shall have been duly listed for quotation
on NASDAQ;
(k) The Company shall have obtained and delivered to the
Underwriters executed copies of an agreement from each of the persons listed on
Schedule III hereto to the effect set forth in Subsection 1(b)(iv) hereof in
form and substance reasonably satisfactory to you;
(l) The Company and the Selling Stockholders shall have
furnished or caused to be furnished to you at such Time of Delivery certificates
of officers of the Company and of the Selling Stockholders, respectively,
satisfactory to you as to the accuracy of the representations and warranties of
the Company and the Selling Stockholders, respectively, herein at and as of such
Time of Delivery, as to the performance by the Company and the Selling
Stockholders of all of their respective obligations hereunder to be performed at
or prior to such Time of Delivery, and as to such other matters as you may
reasonably request, and the Company shall have furnished or caused to be
furnished certificates as to the matters set forth in subsections (a) and (g) of
this Section, and as to such other matters as you may reasonably request; and
(m) The Company shall have complied with the provisions of
Section 5(c) hereof with respect to the furnishing of prospectuses on the New
York Business Day next succeeding the date of this Agreement.
8. (a) The Company and each of Xxxxxx X. Xxxxx and Xxxxxxxxx Xxxxx (the
"Founding Selling Stockholders"), jointly and severally, will indemnify and hold
harmless each Underwriter against any losses, claims, damages or liabilities,
joint or several, to which such Underwriter may become subject, under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon an 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
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 will reimburse each Underwriter for
any legal or other expenses reasonably incurred by such Underwriter in
connection with investigating or defending any such action or claim as such
expenses are incurred; provided, however, that the Company and the Founding
Selling Stockholders shall not be liable in any such case to the extent that any
such loss, claim, damage or liability arises out of or is based upon an untrue
statement or alleged untrue statement or omission or alleged omission made in
any Preliminary Prospectus, the Registration Statement or the Prospectus or any
such amendment or supplement in reliance upon and in conformity with written
information furnished to the
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Company by any Underwriter through Xxxxxxx, Sachs & Co. expressly for use
therein; provided further that the liability of a Founding Selling Stockholder
pursuant to this subsection (a) shall not exceed the product of the number of
Shares sold by such Selling Stockholder and the initial public offering price of
the Shares (after deducting underwriting discounts and commissions) as set forth
in the Prospectus.
(b) Each of the Xxxxxxxx and Xxxxxxx Xxxxxxxxx Foundation and the
Xxxxxxxx and Xxxxxxx Xxxxxx Foundation (the "Foundation Selling Stockholders")
will indemnify and hold harmless each Underwriter against any losses, claims,
damages or liabilities, joint or several, to which such Underwriter may become
subject, under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon an
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 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, in each case
to the extent, but only to the extent, that such untrue statement or alleged
untrue statement or omission or alleged omission was made in any Preliminary
Prospectus, the Registration Statement or the Prospectus or any such amendment
or supplement in reliance upon and in conformity with written information
furnished to the Company by such Foundation Selling Stockholder expressly for
use therein; and will reimburse each Underwriter for any legal or other expenses
reasonably incurred by such Underwriter in connection with investigating or
defending any such action or claim as such expenses are incurred; provided,
however, that such Foundation Selling Stockholder shall not be liable in any
such case to the extent that any such loss, claim, damage or liability arises
out of or is based upon an untrue statement or alleged untrue statement or
omission or alleged omission made in any Preliminary Prospectus, the
Registration Statement or the Prospectus or any such amendment or supplement in
reliance upon and in conformity with written information furnished to the
Company by any Underwriter through Xxxxxxx, Sachs & Co. expressly for use
therein; provided further that the liability of a Foundation Selling Stockholder
pursuant to this subsection (b) shall not exceed the product of the number of
Shares sold by such Foundation Selling Stockholder and the initial public
offering price of the Shares (after deducting underwriting discounts and
commissions) as set forth in the Prospectus.
(c) Each Underwriter will indemnify and hold harmless the
Company and each Selling Stockholder against any losses, claims, damages or
liabilities to which the Company or such Selling Stockholder may become subject,
under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon an
untrue statement or alleged untrue statement of a material fact contained in any
Preliminary Prospectus, the Registration Statement or the Prospectus, or
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any amendment 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, in
each case to the extent, but only to the extent, that such untrue statement or
alleged untrue statement or omission or alleged omission was made in any
Preliminary Prospectus, the Registration Statement or the Prospectus or any such
amendment or supplement in reliance upon and in conformity with written
information furnished to the Company by such Underwriter through Xxxxxxx, Xxxxx
& Co. expressly for use therein; and will reimburse the Company and each Selling
Stockholder for any legal or other expenses reasonably incurred by the Company
or such Selling Stockholder in connection with investigating or defending any
such action or claim as such expenses are incurred.
(d) Promptly after receipt by an indemnified party under
subsection (a), (b) or (c) above of notice of the commencement of any action,
such indemnified party shall, if a claim in respect thereof is to be made
against an indemnifying party under such subsection, notify the indemnifying
party in writing of the commencement thereof; but the omission so to notify the
indemnifying party shall not relieve it from any liability which it may have to
any indemnified party otherwise than under such subsection. In case any such
action shall be brought against any indemnified party and it shall notify the
indemnifying party of the commencement thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it shall wish, jointly
with any other indemnifying party similarly notified, to assume the defense
thereof, with counsel reasonably satisfactory to such indemnified party (which
shall not, except with the consent of the indemnified party, be counsel to the
indemnifying party), and, after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof, the
indemnifying party shall not be liable to such indemnified party under such
subsection for any legal expenses of other counsel or any other expenses, in
each case subsequently incurred by such indemnified party, in connection with
the defense thereof other than reasonable costs of investigation. No
indemnifying party shall, without the written consent of the indemnified party,
effect the settlement or compromise of, or consent to the entry of any judgment
with respect to, any pending or threatened action or claim in respect of which
indemnification or contribution may be sought hereunder (whether or not the
indemnified party is an actual or potential party to such action or claim)
unless such settlement, compromise or judgment (i) includes an unconditional
release of the indemnified party from all liability arising out of such action
or claim and (ii) does not include a statement as to or an admission of fault,
culpability or a failure to act, by or on behalf of any indemnified party.
(e) If the indemnification provided for in this Section 8 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a), (b) or (c) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred
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to therein, then each indemnifying party shall contribute to the amount paid or
payable by such indemnified party as a result of such losses, claims, damages or
liabilities (or actions in respect thereof) in such proportion as is appropriate
to reflect the relative benefits received by the Company and the Selling
Stockholders on the one hand and the Underwriters on the other from the offering
of the Shares. If, however, the allocation provided by the immediately preceding
sentence is not permitted by applicable law or if the indemnified party failed
to give the notice required under subsection (d) above, then each indemnifying
party shall contribute to such amount paid or payable by such indemnified party
in such proportion as is appropriate to reflect not only such relative benefits
but also the relative fault of the Company and the Selling Stockholders on the
one hand and the Underwriters on the other in connection with the statements or
omissions which resulted in such losses, claims, damages or liabilities (or
actions in respect thereof), as well as any other relevant equitable
considerations. The relative benefits received by the Company and the Selling
Stockholders on the one hand and the Underwriters on the other shall be deemed
to be in the same proportion as the total net proceeds from the offering of the
Shares purchased under this Agreement (before deducting expenses but after
deducting underwriting discounts and commissions) received by the Company and
the Selling Stockholders bear to the total underwriting discounts and
commissions received by the Underwriters with respect to the Shares purchased
under this Agreement, in each case as set forth in the table on the cover page
of the Prospectus. The relative fault shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a material fact
or the omission or alleged omission to state a material fact relates to
information supplied by the Company or the Selling Stockholders on the one hand
or the Underwriters on the other and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission. The Company, each of the Selling Stockholders and the Underwriters
agree that it would not be just and equitable if contributions pursuant to this
subsection (e) were determined by pro rata allocation (even if the Underwriters
were treated as one entity for such purpose) or by any other method of
allocation which does not take account of the equitable considerations referred
to above in this subsection (e). The amount paid or payable by an indemnified
party as a result of the losses, claims, damages or liabilities (or actions in
respect thereof) referred to above in this subsection (e) shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified
party in connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this subsection (e), no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the Shares underwritten by it and distributed to the public were
offered to the public exceeds the amount of any damages which such Underwriter
has otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission, and no Selling Stockholder shall be
required to contribute any amount in excess of the product of the number of
Shares sold by such Selling Stockholder and the initial public offering price
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of the Shares (after deducting underwriting discounts and commissions) as set
forth in the Prospectus. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations in this subsection (e) to
contribute are several in proportion to their respective underwriting
obligations and not joint. Each Selling Stockholder's obligations in this
subsection (e) to contribute are several and not joint.
(f) The obligations of the Company and the Selling
Stockholders under this Section 8 shall be in addition to any liability which
the Company and the respective Selling Stockholders may otherwise have and shall
extend, upon the same terms and conditions, to each person, if any, who controls
any Underwriter within the meaning of the Act; and the obligations of the
Underwriters under this Section 8 shall be in addition to any liability which
the respective Underwriters may otherwise have and shall extend, upon the same
terms and conditions, to each officer and director of the Company (including any
person who, with his or her consent, is named in the Registration Statement as
about to become a director of the Company) and to each person, if any, who
controls the Company or any Selling Stockholder within the meaning of the Act.
9. (a) If any Underwriter shall default in its obligation to purchase
the Shares which it has agreed to purchase hereunder at a Time of Delivery, you
may in your discretion arrange for you or another party or other parties to
purchase such Shares on the terms contained herein. If within thirty-six hours
after such default by any Underwriter you do not arrange for the purchase of
such Shares, then the Company and the Selling Stockholders shall be entitled to
a further period of thirty-six hours within which to procure another party or
other parties reasonably satisfactory to you to purchase such Shares on such
terms. In the event that, within the respective prescribed periods, you notify
the Company and the Selling Stockholders that you have so arranged for the
purchase of such Shares, or the Company and the Selling Stockholders notify you
that they have so arranged for the purchase of such Shares, you or the Company
and the Selling Stockholders shall have the right to postpone such Time of
Delivery for a period of not more than seven days, in order to effect whatever
changes may thereby be made necessary in the Registration Statement or the
Prospectus, or in any other documents or arrangements, and the Company agrees to
file promptly any amendments to the Registration Statement or the Prospectus
which in your opinion may thereby be made necessary. The term "Underwriter" as
used in this Agreement shall include any person substituted under this Section
with like effect as if such person had originally been a party to this Agreement
with respect to such Shares.
(b) If, after giving effect to any arrangements for the
purchase of the Shares of a defaulting Underwriter or Underwriters by you and
the Company and the Selling
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Stockholders as provided in subsection (a) above, the aggregate number of such
Shares which remains unpurchased does not exceed one-eleventh of the aggregate
number of all of the Shares to be purchased at such Time of Delivery, then the
Company and the Selling Stockholders shall have the right to require each
non-defaulting Underwriter to purchase the number of Shares which such
Underwriter agreed to purchase hereunder at such Time of Delivery and, in
addition, to require each non-defaulting Underwriter to purchase its pro rata
share (based on the number of Shares which such Underwriter agreed to purchase
hereunder) of the Shares of such defaulting Underwriter or Underwriters for
which such arrangements have not been made; but nothing herein shall relieve a
defaulting Underwriter from liability for its default.
(c) If, after giving effect to any arrangements for the
purchase of the Shares of a defaulting Underwriter or Underwriters by you and
the Company and the Selling Stockholders as provided in subsection (a) above,
the aggregate number of such Shares which remains unpurchased exceeds
one-eleventh of the aggregate number of all of the Shares to be purchased at
such Time of Delivery, or if the Company and the Selling Stockholders shall not
exercise the right described in subsection (b) above to require non-defaulting
Underwriters to purchase Shares of a defaulting Underwriter or Underwriters,
then this Agreement (or, with respect to the Second Time of Delivery, the
obligations of the Underwriters to purchase and of the Company and the Selling
Stockholders to sell the Optional Shares) shall thereupon terminate, without
liability on the part of any non-defaulting Underwriter or the Company or the
Selling Stockholders, except for the expenses to be borne by the Company and the
Selling Stockholders and the Underwriters as provided in Section 6 hereof and
the indemnity and contribution agreements in Section 8 hereof; but nothing
herein shall relieve a defaulting Underwriter from liability for its default.
10. The respective indemnities, agreements, representations, warranties
and other statements of the Company, the Selling Stockholders and the several
Underwriters, as set forth in this Agreement or made by or on behalf of them,
respectively, pursuant to this Agreement, shall remain in full force and effect,
regardless of any investigation (or any statement as to the results thereof)
made by or on behalf of any Underwriter or any controlling person of any
Underwriter, or the Company, or any of the Selling Stockholders, or any officer
or director or controlling person of the Company, or any controlling person of
any Selling Stockholder, and shall survive delivery of and payment for the
Shares.
11. If this Agreement shall be terminated pursuant to Section 9 hereof,
neither the Company nor the Selling Stockholders shall then be under any
liability to any Underwriter except as provided in Sections 6 and 8 hereof; but,
if for any other reason any Shares are not delivered by or on behalf of the
Company and the Selling Stockholders as provided herein, the Company will
reimburse the Underwriters through you for all
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reasonable out-of-pocket expenses approved in writing by you, including fees and
disbursements of counsel, reasonably incurred by the Underwriters in making
preparations for the purchase, sale and delivery of the Shares not so delivered,
but the Company and the Selling Stockholders shall then be under no further
liability to any Underwriter in respect of the Shares not so delivered except as
provided in Sections 6 and 8 hereof.
12. In all dealings hereunder, you shall act on behalf of each of the
Underwriters, and the parties hereto shall be entitled to act and rely upon any
statement, request, notice or agreement on behalf of any Underwriter made or
given by you jointly or by Xxxxxxx, Xxxxx & Co. on behalf of you as the
Representatives; and in all dealings with any Selling Stockholder hereunder, you
and the Company shall be entitled to act and rely upon any statement, request,
notice or agreement on behalf of such Selling Stockholder made or given by any
or all of the Attorneys-in-Fact for such Selling Stockholder.
All statements, requests, notices and agreements hereunder shall be in
writing, and if to the Underwriters shall be delivered or sent by mail or
facsimile transmission to you as the Representatives in care of Xxxxxxx, Sachs &
Co., 00 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Registration
Department; if to any Selling Stockholder shall be delivered or sent by mail or
facsimile transmission to such Selling Stockholder at its address set forth in
Schedule II hereto; and if to the Company shall be delivered or sent by mail or
facsimile transmission to the address of the Company set forth in the
Registration Statement, Attention: Secretary; provided, however, that any notice
to an Underwriter pursuant to Section 8 (d) hereof shall be delivered or sent by
mail or facsimile transmission to such Underwriter at its address set forth in
its Underwriters' Questionnaire or telex constituting such Questionnaire, which
address will be supplied to the Company or the Selling Stockholders by you upon
request. Any such statements, requests, notices or agreements shall take effect
upon receipt thereof.
13. This Agreement shall be binding upon, and inure solely to the
benefit of, the Underwriters, the Company and the Selling Stockholders and, to
the extent provided in Sections 8 and 10 hereof, the officers and directors of
the Company and each person who controls the Company, any Selling Stockholder or
any Underwriter, and their respective heirs, executors, administrators,
successors and assigns, and no other person shall acquire or have any right
under or by virtue of this Agreement. No purchaser of any of the Shares from any
Underwriter shall be deemed a successor or assign by reason merely of such
purchase.
14. Time shall be of the essence of this Agreement. As used herein, the
term "business day" shall mean any day when the Commission's office in
Washington, D.C. is open for business.
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15. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK.
16. This Agreement may be executed by any one or more of the parties
hereto in any number of counterparts, each of which shall be deemed to be an
original, but all such counterparts shall together constitute one and the same
instrument.
If the foregoing is in accordance with your understanding, please sign
and return to us eight counterparts hereof, and upon the acceptance hereof by
you, on behalf of each of the Underwriters, this letter and such acceptance
hereof shall constitute a binding agreement among each of the Underwriters, the
Company and each of the Selling Stockholders. It is understood that your
acceptance of this letter on behalf of each of the Underwriters is pursuant to
the authority set forth in a form of Agreement among Underwriters (U.S.
Version), the form of which shall be submitted to the Company and the Selling
Stockholders for examination upon request, but without warranty on your part as
to the authority of the signers thereof.
Any person executing and delivering this Agreement as Attorney-in-Fact
for a Selling Stockholder represents by so doing that he has been duly appointed
as Attorney-in-Fact by such Selling Stockholder pursuant to a validly existing
and binding Power of Attorney which authorizes such Attorney-in-
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Fact to take such action.
Very truly yours,
CMP Media Inc.
By:_____________________________________
Name:
Title:
Xxxxxx X. Xxxxx
Xxxxxxxxx X. Xxxxx
Xxxxxxxx and Xxxxxxx Xxxxxxxxx Foundation
Xxxxxxxx and Xxxxxxx Xxxxxx Foundation
By:_____________________________________
Name:
Title:
As Attorney-in-Fact acting
on behalf of each of the
Selling Stockholders named
in Schedule II to this
Agreement.
Accepted as of the date hereof
Xxxxxxx, Sachs & Co.
Lazard Freres & Co. LLC
Bear, Xxxxxxx & Co. Inc.
Xxxxxx Xxxx LLC
By:__________________________________
(Xxxxxxx, Xxxxx & Co.)
On behalf of each of the Underwriters
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SCHEDULE I
TOTAL NUMBER NUMBER OF OPTIONAL
OF SHARES TO BE
FIRM SHARES PURCHASED IF
TO BE MAXIMUM OPTION
UNDERWRITER PURCHASED EXERCISED
Xxxxxxx, Sachs & Co....................................................
Lazard Freres & Co. LLC
Bear, Xxxxxxx & Co. Inc.
Xxxxxx Xxxx LLC........................................................
[Names of other Underwriters].......................................... ______________ ______________
Total ============== ==============
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SCHEDULE II
NUMBER OF OPTIONAL
TOTAL NUMBER SHARES TO BE
OF SOLD IF
FIRM SHARES MAXIMUM OPTION
TO BE SOLD EXERCISED
The Company............................................................
The Selling Stockholders (a):
Xxxxxx X. Xxxxx ................................................ 0
Xxxxxxxxx X. Xxxxx.............................................. 0
Xxxxxxxx and Xxxxxxx Xxxxxxxxx Foundation....................... 0
Xxxxxxxx and Xxxxxxx Xxxxxx Foundation.......................... 0
_____________ ________________
Total ============= ================
(a) Each Selling Stockholder is represented by [Name and Address of
Counsel] and has appointed [Names of Attorneys-in-Fact (not less than two)], and
each of them, as the Attorneys-in-Fact for such Selling Stockholder. The address
of each person set forth in the above table is c/o CMP Media Inc., 000 Xxxxxxxxx
Xxxxx, Xxxxxxxxx, Xxx Xxxx 00000, attention: Secretary.
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SCHEDULE III
[persons subject to lock-up]
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ANNEX I
Pursuant to Section 7(f) of the Underwriting Agreement, the accountants
shall furnish letters to the Underwriters to the effect that:
(i) They are independent certified public accountants with
respect to the Company and its subsidiaries within the meaning of the
Act and the applicable published rules and regulations thereunder;
(ii) In their opinion, the financial statements and any
supplementary financial information and schedules (and, if applicable,
financial forecasts and/or pro forma financial information) examined by
them and included in the Prospectus or the Registration Statement
comply as to form in all material respects with the applicable
accounting requirements of the Act and the related published rules and
regulations thereunder; and, if applicable, they have made a review in
accordance with standards established by the American Institute of
Certified Public Accountants of the unaudited consolidated interim
financial statements, selected financial data, pro forma financial
information, financial forecasts and/or condensed financial statements
derived from audited financial statements of the Company for the
periods specified in such letter, as indicated in their reports
thereon, copies of which have been separately furnished to the
representatives of the Underwriters (the "Representatives");
(iii) They have made a review in accordance with standards
established by the American Institute of Certified Public Accountants
of the unaudited condensed consolidated statements of income,
consolidated balance sheets and consolidated statements of cash flows
included in the Prospectus as indicated in their reports thereon copies
of which have been separately furnished to the Representatives; and on
the basis of specified procedures including inquiries of officials of
the Company who have responsibility for financial and accounting
matters regarding whether the unaudited condensed consolidated
financial statements referred to in paragraph (vi)(A)(i) below comply
as to form in all material respects with the applicable accounting
requirements of the Act and the related published rules and
regulations, nothing came to their attention that caused them to
believe that the unaudited condensed consolidated financial statements
do not comply as to form in all material respects with the applicable
accounting requirements of the Act and the related published rules and
regulations;
41
(iv) The unaudited selected financial information with respect
to the consolidated results of operations and financial position of the
Company for the five most recent fiscal years included in the
Prospectus agrees with the corresponding amounts (after restatements
where applicable) in the audited consolidated financial statements for
such five fiscal years;
(v) They have compared the information in the Prospectus under
selected captions with the disclosure requirements of Regulation S-K
and on the basis of limited procedures specified in such letter nothing
came to their attention as a result of the foregoing procedures that
caused them to believe that this information does not conform in all
material respects with the disclosure requirements of Items 301, 302,
402 and 503(d), respectively, of Regulation S-K;
(vi) On the basis of limited procedures, not constituting an
examination in accordance with generally accepted auditing standards,
consisting of a reading of the unaudited financial statements and other
information referred to below, a reading of the latest available
interim financial statements of the Company and its subsidiaries,
inspection of the minute books of the Company and its subsidiaries
since the date of the latest audited financial statements included in
the Prospectus, inquiries of officials of the Company and its
subsidiaries responsible for financial and accounting matters and such
other inquiries and procedures as may be specified in such letter,
nothing came to their attention that caused them to believe that:
(A) (i) the unaudited consolidated statements of
income, consolidated balance sheets and consolidated
statements of cash flows included in the Prospectus do not
comply as to form in all material respects with the applicable
accounting requirements of the Act and the related published
rules and regulations, or (ii) any material modifications
should be made to the unaudited condensed consolidated
statements of income, consolidated balance sheets and
consolidated statements of cash flows included in the
Prospectus for them to be in conformity with generally
accepted accounting principles;
(B) any other unaudited income statement data and
balance sheet items included in the Prospectus do not agree
with the corresponding items in the unaudited consolidated
financial statements from which such data and items were
derived, and any such unaudited data and items were not
determined on a basis substantially consistent with the basis
for the corresponding amounts in the audited consolidated
financial statements included in the Prospectus;
2
42
(C) the unaudited financial statements which were not
included in the Prospectus but from which were derived any
unaudited condensed financial statements referred to in Clause
(A) and any unaudited income statement data and balance sheet
items included in the Prospectus and referred to in Clause (B)
were not determined on a basis substantially consistent with
the basis for the audited consolidated financial statements
included in the Prospectus;
(D) any unaudited pro forma consolidated condensed
financial statements included in the Prospectus do not comply
as to form in all material respects with the applicable
accounting requirements of the Act and the published rules and
regulations thereunder or the pro forma adjustments have not
been properly applied to the historical amounts in the
compilation of those statements;
(E) as of a specified date not more than five days
prior to the date of such letter, there have been any changes
in the consolidated capital stock (other than issuances of
capital stock upon exercise of options and stock appreciation
rights, upon earn-outs of performance shares and upon
conversions of convertible securities, in each case which were
outstanding on the date of the latest financial statements
included in the Prospectus) or any increase in the
consolidated long-term debt of the Company and its
subsidiaries, or any decreases in consolidated net current
assets or stockholders' equity or other items specified by the
Representatives, or any increases in any items specified by
the Representatives, in each case as compared with amounts
shown in the latest balance sheet included in the Prospectus,
except in each case for changes, increases or decreases which
the Prospectus discloses have occurred or may occur or which
are described in such letter; and
(F) for the period from the date of the latest
financial statements included in the Prospectus to the
specified date referred to in Clause (E) there were any
decreases in consolidated net revenues or operating profit or
the total or per share amounts of consolidated net income or
other items specified by the Representatives, or any increases
in any items specified by the Representatives, in each case as
compared with the comparable period of the preceding year and
with any other period of corresponding length specified by the
Representatives, except in each case for decreases or
increases which the Prospectus discloses have occurred or may
occur or which are described in such letter; and
3
43
(vii) In addition to the examination referred to in their
report(s) included in the Prospectus and the limited procedures,
inspection of minute books, inquiries and other procedures referred to
in paragraphs (iii) and (vi) above, they have carried out certain
specified procedures, not constituting an examination in accordance
with generally accepted auditing standards, with respect to certain
amounts, percentages and financial information specified by the
Representatives, which are derived from the general accounting records
of the Company and its subsidiaries, which appear in the Prospectus, or
in Part II of, or in exhibits and schedules to, the Registration
Statement specified by the Representatives, and have compared certain
of such amounts, percentages and financial information with the
accounting records of the Company and its subsidiaries and have found
them to be in agreement.
4
44
ANNEX I(a)
[executed comfort letter of Coopers & Xxxxxxx L.L.P.]
45
ANNEX I(b)
[form of bring-down comfort letter of Coopers & Xxxxxxx L.L.P.]
46
ANNEX II (a)
[form of opinion of Debevoise & Xxxxxxxx]
47
ANNEX II (b)
[form of opinion of Dow, Xxxxxx & Xxxxxxxxx, PLLC]
48
ANNEX II (c)
[form of opinion of General Counsel of the Company]
49
ANNEX II (d)
[form of opinion of counsel for the Selling Stockholders]
