Exhibit 1.1
PGT, INC.
[___] Shares
Common Stock
($0.01 par value per Share)
UNDERWRITING AGREEMENT
[ ], 2006
UNDERWRITING AGREEMENT
[ ], 2006
Deutsche Bank Securities Inc.
X.X. Xxxxxx Securities Inc.
JMP Securities LLC
Xxxxxxx Xxxxx & Associates, Inc.
SunTrust Xxxxxxxx Xxxxxxxx Capital Markets, Inc.
c/o Deutsche Bank Securities Inc.
00 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
PGT, Inc., a Delaware corporation (the "Company"), proposes to issue and
sell, to the underwriters named in Schedule A annexed hereto (the
"Underwriters"), for whom you are acting as representatives, an aggregate of [ ]
shares (the "Firm Shares") of common stock, $0.01 par value per share (the
"Common Stock"), of the Company. In addition, solely for the purpose of covering
over-allotments, the Company proposes to grant to the Underwriters the option to
purchase from the Company up to an additional [ ] shares of Common Stock (the
"Additional Shares"). The Firm Shares and the Additional Shares are hereinafter
collectively sometimes referred to as the "Shares." The Shares are described in
the Prospectus which is referred to below.
The Company hereby acknowledges that, in connection with the proposed
offering of the Shares, it has requested Deutsche Bank Alex. Xxxxx, a division
of Deutsche Bank Securities Inc. ("DB-DSP"), to administer a directed share
program (the "Directed Share Program") under which up to [ ] Firm Shares, or 7%
of the Firm Shares to be purchased by the Underwriters (the "Reserved Shares"),
shall be reserved for sale by DB-DSP at the initial public offering price to the
Company's officers, directors, employees and consultants and other persons
having a relationship with the Company or such persons, in each case, as
designated by the Company (the "Directed Share Participants") as part of the
distribution of the Shares by the Underwriters, subject to the terms of this
Agreement, the applicable rules, regulations and interpretations of the National
Association of Securities Dealers, Inc. (the "NASD") and all other applicable
laws, rules and regulations. The number of Shares available for sale to the
general public will be reduced to the extent that Directed Share Participants
purchase Reserved Shares. The Underwriters may offer any Reserved Shares not
purchased by Directed Share Participants to the general public on the same basis
as the other Shares being issued and sold hereunder. The Company has supplied
DB-DSP with the names, addresses and telephone numbers of the individuals or
other entities which the Company has designated to be participants in the
Directed Share Program. It is understood that any number of those so designated
to participate in the Directed Share Program may decline to do so.
The Company has prepared and filed, in accordance with the provisions of
the Securities Act of 1933, as amended, and the rules and regulations thereunder
(collectively, the "Act"), with the Securities and Exchange Commission (the
"Commission") a registration state-
ment on Form S-1 (File No. 333-132365) under the Act, including a prospectus,
relating to the Shares.
Except where the context otherwise requires, "Registration Statement," as
used herein, means the registration statement, as amended at the time of such
registration statement's effectiveness for purposes of Section 11 of the Act, as
such section applies to the respective Underwriters (the "Effective Time"),
including (i) all documents filed as a part thereof, (ii) any information
contained in a prospectus filed with the Commission pursuant to Rule 424(b)
under the Act and deemed, pursuant to Rule 430A or Rule 430C under the Act, to
be part of the registration statement at the Effective Time, and (iii) any
registration statement filed to register the offer and sale of Shares pursuant
to Rule 462(b) under the Act.
The Company has furnished to you, for use by the Underwriters and by
dealers in connection with the offering of the Shares, copies of one or more
preliminary prospectuses relating to the Shares. Except where the context
otherwise requires, "Preliminary Prospectus," as used herein, means each such
preliminary prospectus, in the form so furnished.
Except where the context otherwise requires, "Prospectus," as used herein,
means the prospectus filed by the Company with the Commission pursuant to Rule
424(b) under the Act on or before the second business day after the date hereof
(or such earlier time as may be required under the Act), or, if no such filing
is required, the final prospectus included in the Registration Statement at the
time it became effective under the Act, in each case in the form furnished by
the Company to you for use by the Underwriters and by dealers in connection with
the offering of the Shares.
"Permitted Free Writing Prospectuses," as used herein, means the documents
listed on Schedule B attached hereto, including each "road show" (as defined in
Rule 433 under the Act), if any, related to the offering of the Shares
contemplated hereby that is a "written communication" (as defined in Rule 405
under the Act) and listed on Schedule B attached hereto (each such road show, a
"Road Show").
"Disclosure Package," as used herein, means any Preliminary Prospectus
together with any combination of one or more of the Permitted Free Writing
Prospectuses, if any.
As used in this Agreement, "business day" shall mean a day on which the
New York Stock Exchange (the "NYSE") is open for trading. The terms "herein,"
"hereof," "hereto," "hereinafter" and similar terms, as used in this Agreement,
shall in each case refer to this Agreement as a whole and not to any particular
section, paragraph, sentence or other subdivision of this Agreement. The term
"or," as used herein, is not exclusive.
The Company has prepared and filed, in accordance with Section 12 of the
Securities Exchange Act of 1934, as amended, and the rules and regulations
thereunder (collectively, the "Exchange Act"), a registration statement (as
amended, the "Exchange Act Registration Statement") on Form 8-A (File No.
[____]) under the Exchange Act to register, under Section 12(g) of the Exchange
Act, the class of securities consisting of the Common Stock.
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The Company and the Underwriters agree as follows:
1. Sale and Purchase. Upon the basis of the representations and warranties
and subject to the terms and conditions herein set forth, the Company agrees to
issue and sell, to the respective Underwriters and each of the Underwriters,
severally and not jointly, agrees to purchase from the Company, the respective
number of Firm Shares (subject to such adjustment as Deutsche Bank Securities
Inc. ("DBSI") may determine to avoid fractional shares) set forth opposite the
name of such Underwriter in Schedule A annexed hereto, subject to adjustment in
accordance with Section 9 hereof, in each case at a purchase price of $[ ] per
share. The Company is advised by you that the Underwriters intend (i) to make a
public offering of their respective portions of the Firm Shares as soon after
the effective date of the Registration Statement as in your judgment is
advisable and (ii) initially to offer the Firm Shares upon the terms set forth
in the Prospectus. You may from time to time increase or decrease the public
offering price after the initial public offering to such extent as you may
determine.
In addition, the Company hereby grants to the several Underwriters the
option (the "Over-Allotment Option") to purchase, and upon the basis of the
representations and warranties and subject to the terms and conditions herein
set forth, the Underwriters shall have the right to purchase, severally and not
jointly, from the Company all or a portion of the Additional Shares as may be
necessary to cover over-allotments made in connection with the offering of the
Firm Shares, at the same purchase price per share to be paid by the Underwriters
to the Company for the Firm Shares. The Over-Allotment Option may be exercised
by DBSI on behalf of the several Underwriters at any time and from time to time
on or before the thirtieth day following the date of the Prospectus, by written
notice to the Company. Such notice shall set forth the aggregate number of
Additional Shares as to which the Over-Allotment Option is being exercised and
the date and time when the Additional Shares are to be delivered (any such date
and time being herein referred to as an "additional time of purchase");
provided, however, that no additional time of purchase shall be earlier than the
"time of purchase" (as defined below) nor earlier than the second business day
after the date on which the Over-Allotment Option shall have been exercised nor
later than the tenth business day after the date on which the Over-Allotment
Option shall have been exercised. The number of Additional Shares to be sold to
each Underwriter shall be the number which bears the same proportion to the
aggregate number of Additional Shares being purchased as the number of Firm
Shares set forth opposite the name of such Underwriter on Schedule A hereto
bears to the total number of Firm Shares (subject, in each case, to such
adjustment as DBSI may determine to eliminate fractional shares), subject to
adjustment in accordance with Section 9 hereof.
2. Payment and Delivery. Payment of the purchase price for the Firm Shares
shall be made to the Company by Federal Funds wire transfer against delivery of
the certificates for the Firm Shares to you through the facilities of The
Depository Trust Company ("DTC") for the respective accounts of the
Underwriters. Such payment and delivery shall be made at 10:00 A.M., New York
City time, on [ ], 2006 (unless another time shall be agreed to by you and the
Company or unless postponed in accordance with the provisions of Section 9
hereof). The time at which such payment and delivery are to be made is
hereinafter sometimes called "the time of purchase." Electronic transfer of the
Firm Shares shall be made to you at the time of purchase in such names and in
such denominations as you shall specify.
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Payment of the purchase price for the Additional Shares shall be made at
the additional time of purchase in the same manner and at the same office as the
payment for the Firm Shares. Electronic transfer of the Additional Shares shall
be made to you at the additional time of purchase in such names
and in such denominations as you shall specify.
Deliveries of the documents described in Section 7 hereof with respect to
the purchase of the Shares shall be made at the offices of Xxxxxx Xxxxxx &
Xxxxxxx LLP at 00 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, at 9:00 A.M., New York
City time, on the date of the closing of the purchase of the Firm Shares or the
Additional Shares, as the case may be.
3. Representations and Warranties of the Company. The Company represents
and warrants to and agrees with each of the Underwriters that:
(a) the Registration Statement has heretofore become effective under
the Act or, with respect to any registration statement to be filed to
register the offer and sale of Shares pursuant to Rule 462(b) under the
Act, will be filed with the Commission and become effective under the Act
no later than 10:00 P.M., New York City time, on the date of determination
of the public offering price for the Shares; no stop order of the
Commission preventing or suspending the use of any Preliminary Prospectus
or Permitted Free Writing Prospectus or the effectiveness of the
Registration Statement has been issued, and no proceedings for such
purpose have been instituted or, to the actual knowledge of any of the
Company's employees mentioned by name under the caption "Management" in
the Preliminary Prospectus (the "Company's Knowledge"), are contemplated
by the Commission; the Exchange Act Registration Statement has become
effective as provided in Section 12 of the Exchange Act;
(b) the Registration Statement complied when it became effective,
complies as of the date hereof and, as amended or supplemented, at the
time of purchase and each additional time of purchase, if any, and at all
times during which a prospectus is required by the Act to be delivered
(whether physically or through compliance with Rule 172 under the Act or
any similar rule) in connection with any sale of Shares, will comply, in
all material respects, with the requirements of the Act; the Registration
Statement did not, as of the Effective Time, 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; each
Preliminary Prospectus complied, at the time it was filed with the
Commission, and complies as of the date hereof, in all material respects
with the requirements of the Act; at no time during the period that begins
on the earlier of the date of such Preliminary Prospectus and the date
such Preliminary Prospectus was filed with the Commission and ends at the
time of purchase did or will any Preliminary Prospectus, as then amended
or supplemented, include an untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements therein,
in the light of the circum-
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stances under which they were made, not misleading, and at no time during
such period did or will any Preliminary Prospectus, as then amended or
supplemented, together with any combination of one or more of the then
issued Permitted Free Writing Prospectuses, if any, include an untrue
statement of a material fact or omit to state a material fact necessary in
order to make the statements therein, in the light of the circumstances
under which they were made, not misleading; the Prospectus will comply, as
of its date, the date that it is filed with the Commission, the time of
purchase, each additional time of purchase, if any, and at all times
during which a prospectus is required by the Act to be delivered (whether
physically or through compliance with Rule 172 under the Act or any
similar rule) in connection with any sale of Shares, in all material
respects, with the requirements of the Act (including, without limitation,
Section 10(a) of the Act); at no time during the period that begins on the
earlier of the date of the Prospectus and the date the Prospectus is filed
with the Commission and ends at the later of the time of purchase, the
latest additional time of purchase, if any, and the end of the period
during which a prospectus is required by the Act to be delivered (whether
physically or through compliance with Rule 172 under the Act or any
similar rule) in connection with any sale of Shares did or will the
Prospectus, as then amended or supplemented, include an untrue statement
of a material fact or omit to state a material fact necessary in order to
make the statements therein, in the light of the circumstances under which
they were made, not misleading; at no time during the period that begins
on the date of such Permitted Free Writing Prospectus and ends at the time
of purchase did or will any Permitted Free Writing Prospectus include an
untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided,
however, that the Company makes no representation or warranty with respect
to any statement contained in the Registration Statement, any Preliminary
Prospectus, the Prospectus or any Permitted Free Writing Prospectus in
reliance upon and in conformity with information concerning an Underwriter
and furnished in writing by or on behalf of such Underwriter to the
Company expressly for use in the Registration Statement, such Preliminary
Prospectus, the Prospectus or such Permitted Free Writing Prospectus;
(c) prior to the execution of this Agreement, the Company has not,
directly or indirectly, offered or sold any Shares by means of any
"prospectus" (within the meaning of the Act) or used any "prospectus"
(within the meaning of the Act) in connection with the offer or sale of
the Shares, in each case other than the Preliminary Prospectuses and the
Permitted Free Writing Prospectuses, if any; the Company has not, directly
or indirectly, prepared, used or referred to any Permitted Free Writing
Prospectus except in compliance with Rules 164 and 433 under the Act;
assuming that such Permitted Free Writing Prospectus is accompanied or
preceded by the most recent Preliminary Prospectus that contains a price
range or the Prospectus, as the case may be, and that such Permitted Free
Writing Prospectus is so sent or given after the Registration Statement
was filed with the Commission (and after such Permitted Free Writing
Prospectus was, if required pursuant to Rule 433(d) under the Act, filed
with the Commission), the sending or giving, by any Underwriter, of any
Permitted Free Writing Prospectus will satisfy the provisions of Rule 164
or Rule 433 (without reliance on subsections (b), (c) and (d) of Rule
164); the Preliminary Prospectus dated [ ], 2006 is a prospectus that,
other than by reason of Rule 433 or Rule 431 under the Act, satisfies the
requirements of Section 10 of the Act, including a price range where
required by rule; neither the Company nor the Underwriters are
disqualified, by reason of subsection (f) or (g) of Rule 164 under the
Act, from using, in connection with the offer and sale of the Shares,
"free writing pro-
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spectuses" (as defined in Rule 405 under the Act) pursuant to Rules 164
and 433 under the Act; the Company is not an "ineligible issuer" (as
defined in Rule 405 under the Act) as of the eligibility determination
date for purposes of Rules 164 and 433 under the Act with respect to the
offering of the Shares contemplated by the Registration Statement; the
parties hereto agree and understand that the content of any and all "road
shows" (as defined in Rule 433 under the Act) related to the offering of
the Shares contemplated hereby is solely the property of the Company; the
Company has caused there to be made available at least one version of a
"bona fide electronic road show" (as defined in Rule 433 under the Act) in
a manner that, pursuant to Rule 433(d)(8)(ii) under the Act, causes the
Company not to be required, pursuant to Rule 433(d) under the Act, to
file, with the Commission, any Road Show;
(d) as of [ ], 2006, the Company had the authorized and outstanding
capitalization as set forth as of such date in the sections of the
Registration Statement, the Preliminary Prospectuses and the Prospectus
entitled "Capitalization" (under the "Actual" column) and "Description of
capital stock" (and any similar sections or information, if any, contained
in any Permitted Free Writing Prospectus) and as of the time of purchase
and any additional time of purchase, as the case may be, the Company shall
have an authorized and outstanding capitalization as set forth in the
sections of the Registration Statement and the Prospectus entitled
"Capitalization" (under the "As adjusted for recapitalization transactions
and this offering" column) and "Description of capital stock" after giving
effect to such time of purchase (and any similar sections or information,
if any, contained in any Permitted Free Writing Prospectus) (subject, in
each case, to the issuance of shares of Common Stock upon exercise of
stock options and warrants disclosed as outstanding in the Registration
Statement (excluding the exhibits thereto), each Preliminary Prospectus
and the Prospectus, and the grant of options and issuance of restricted
shares of Common Stock under existing stock option plans described in the
Registration Statement (excluding the exhibits thereto), each Preliminary
Prospectus and the Prospectus). All of the issued and outstanding shares
of capital stock, including shares of Common Stock, of the Company have
been duly authorized and validly issued, are fully paid and
non-assessable, have been issued in compliance with all applicable
securities laws and were not issued in violation of any preemptive right,
resale right, right of first refusal or similar right;
(e) prior to the date hereof, the Company has duly effected and
completed a 662.07889-for-1 stock split of the Common Stock in the manner
described in the Registration Statement (excluding the exhibits thereto),
each Preliminary Prospectus and the Prospectus; and the Amended and
Restated Certificate of Incorporation of the Company and the Amended and
Restated Bylaws of the Company, each in the form filed as an exhibit to
the Registration Statement, have been heretofore duly authorized and
approved in accordance with the General Corporation Law of the State of
Delaware and shall become effective and in full force and effect at or
before the time of purchase; the Shares are duly listed, and admitted and
authorized for trading, subject to official notice of issuance and
evidence of satisfactory distribution, on the Nasdaq National Market (the
"NASDAQ");
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(f) 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 full corporate power and authority to own, lease and operate its
properties and conduct its business as described in the Registration
Statement, the Preliminary Prospectuses, the Prospectus and the Permitted
Free Writing Prospectuses, if any, to execute and deliver this Agreement
and to issue, sell and deliver the Shares to be sold by it pursuant hereto
as contemplated herein;
(g) the Company is duly qualified to do business as a foreign
corporation and is in good standing in each jurisdiction where the
ownership or leasing of its properties or the conduct of its business
requires such qualification, except where the failure to be so qualified
and in good standing would not, individually or in the aggregate, either
(i) reasonably be expected to result in a material adverse effect on the
business, properties, financial condition or results of operations of the
Company and the Subsidiaries (as defined below) taken as a whole, (ii)
prevent or materially interfere with consummation of the transactions
contemplated hereby or (iii) prevent the shares of Common Stock from being
accepted for listing on, or result in the delisting of shares of Common
Stock from the NASDAQ (the occurrence of any such effect or any such
prevention or interference or any such result described in the foregoing
clauses (i), (ii) and (iii) being herein referred to as a "Material
Adverse Effect");
(h) attached as Schedule C is a true and complete list of each
entity which is a subsidiary of the Company (as defined under the Act)
(each, a "Subsidiary" and, together, the "Subsidiaries"), their
jurisdictions of organization, names of their equityholder(s) and
percentage held by each equityholder; other than the capital stock of the
Subsidiaries, the Company does not own, directly or indirectly, any shares
of stock or any other equity interests or long-term debt securities of any
corporation, firm, partnership, joint venture, association or other
entity; complete and correct copies of the charters and the bylaws of the
Company and each Subsidiary and all amendments thereto have been delivered
to you, and, except as set forth in the exhibits to the Registration
Statement, no changes therein will be made on or after the date hereof
through and including the time of purchase or, if later, any additional
time of purchase; each Subsidiary has been duly incorporated and is
validly existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, with full corporate power and authority
to own, lease and operate its properties and to conduct its business as
described in the Registration Statement, the Preliminary Prospectuses, the
Prospectus and the Permitted Free Writing Prospectuses, if any; each
Subsidiary is duly qualified to do business as a foreign corporation and
is in good standing in each jurisdiction where the ownership or leasing of
its properties or the conduct of its business requires such qualification,
except where the failure to be so qualified and in good standing would
not, individually or in the aggregate, reasonably be expected to result in
a Material Adverse Effect; all of the issued and outstanding shares of
capital stock of each of the Subsidiaries have been duly authorized and
validly issued, are fully paid and non-assessable, have been issued in
compliance with all applicable securities laws, were not issued in
violation of any preemptive right, resale right, right of first refusal or
similar right and are owned by the Company subject to no security
interest, other encumbrance or adverse claims other than transfer
restrictions imposed by the Act,
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the securities or Blue Sky laws of certain jurisdictions and security
interests granted pursuant to the Second Amended and Restated Credit
Agreement, dated February 14, 2006, among PGT Industries, Inc., as
Borrower, JLL Window Holdings, Inc., the lenders party thereto and UBS AG,
Stamford Branch, as Administrative Agent (the "Credit Agreement") and the
Second Lien Credit Agreement, dated February 14, 2006, among PGT
Industries, Inc., as Borrower, JLL Window Holdings, Inc., the lenders
party thereto and UBS AG, Stamford Branch, as Administrative Agent (the
"Second Lien Credit Agreement"), and any documents relating to the Credit
Agreement and the Second Lien Credit Agreement (the "Credit Documents"),
and there are no options, warrants or other rights to purchase, agreements
or other obligations to issue or other rights to convert any obligation
into shares of capital stock or ownership interests in the Subsidiaries
outstanding;
(i) the Shares to be issued and sold by the Company pursuant hereto
have been duly authorized and, when issued and delivered against payment
therefor as provided herein, will be validly issued, fully paid and
non-assessable and free of statutory and contractual preemptive rights,
resale rights, rights of first refusal and similar rights; the Shares to
be sold by the Company pursuant hereto, when issued and delivered against
payment therefor as provided herein, will be free of any restriction upon
the voting or transfer thereof pursuant to the Company's charter or bylaws
or any agreement or other instrument to which the Company is a party;
(j) the capital stock of the Company, including the Shares, conforms
in all material respects to each description thereof, if any, contained in
the Registration Statement, any Preliminary Prospectuses, the Prospectus
or any Permitted Free Writing Prospectus; and the certificates for the
Shares are in due and proper form;
(k) this Agreement has been duly authorized, executed and delivered
by the Company;
(l) neither the Company nor any of the Subsidiaries is in breach or
violation of or in default under (nor has any event occurred which, with
notice, lapse of time or both, would result in any breach or violation of,
constitute a default under or give the holder of any indebtedness (or a
person acting on such holder's behalf) the right to require the
repurchase, redemption or repayment of all or a part of such indebtedness
under) (A) its charter or bylaws, or (B) any indenture, mortgage, deed of
trust, bank loan or credit agreement or other evidence of indebtedness, or
any license, lease, contract or other agreement or instrument to which it
is a party or by which it or any of its properties may be bound or
affected, or (C) any federal, state, local or foreign law, regulation or
rule, or (D) any rule or regulation of any self-regulatory organization or
other non-governmental regulatory authority (including, without
limitation, the rules and regulations of the NASDAQ), or (E) any decree,
judgment or order applicable to it or any of its properties, except, in
the case of clauses B through E, as would not, individually or in the
aggregate, reasonably be expected to result in a Material Adverse Effect;
(m) the execution, delivery and performance of this Agreement, the
issuance and sale of the Shares to be sold by the Company pursuant hereto
and the consummation
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of the transactions contemplated hereby will not conflict with, result in
any breach or violation of or constitute a default under (nor constitute
any event which, with notice, lapse of time or both, would result in any
breach or violation of, constitute a default under or give the holder of
any indebtedness (or a person acting on such holder's behalf) the right to
require the repurchase, redemption or repayment of all or a part of such
indebtedness under) (or result in the creation or imposition of a lien,
charge or encumbrance on any property or assets of the Company or any
Subsidiary pursuant to) (A) the charter or bylaws of the Company or any of
the Subsidiaries, or (B) any indenture, mortgage, deed of trust, bank loan
or credit agreement or other evidence of indebtedness, or any license,
lease, contract or other agreement or instrument to which the Company or
any of the Subsidiaries is a party or by which any of them or any of their
respective properties may be bound or affected, or (C) any federal, state,
local or foreign law, regulation or rule, or (D) any rule or regulation of
any self-regulatory organization or other non-governmental regulatory
authority (including, without limitation, the rules and regulations of the
NASDAQ), or (E) any decree, judgment or order applicable to the Company or
any of the Subsidiaries or any of their respective properties, except, in
the case of clauses B through E, as would not, individually or in the
aggregate, reasonably be expected to result in a Material Adverse Effect;
(n) no approval, authorization, consent or order of or filing with
any federal, state, local or foreign governmental or regulatory
commission, board, body, authority or agency, or of or with any
self-regulatory organization or other non-governmental regulatory
authority (including, without limitation, the NASDAQ), or approval of the
stockholders of the Company, is required in connection with the issuance
and sale of the Shares to be sold by the Company pursuant hereto, or the
consummation of the transactions contemplated hereby, other than (i)
registration of the Shares under the Act, which has been effected (or,
with respect to any registration statement to be filed hereunder pursuant
to Rule 462(b) under the Act, will be effected in accordance herewith),
(ii) any necessary qualification under the securities or blue sky laws of
the various jurisdictions in which the Shares are being offered by the
Underwriters or (iii) under the Conduct Rules of the NASD;
(o) except as described in the Registration Statement (excluding the
exhibits thereto), each Preliminary Prospectus and the Prospectus, (i) no
person has the right, contractual or otherwise, to cause the Company to
issue or sell to it any shares of Common Stock or shares of any other
capital stock or other equity interests of the Company, (ii) no person has
any preemptive rights, or, to the Company's Knowledge, resale rights,
rights of first refusal or other rights to purchase any shares of Common
Stock or shares of any other capital stock of or other equity interests in
the Company, (iii) no person has the right to act as an underwriter or as
a financial advisor to the Company in connection with the offer and sale
of the Shares, and (iv) no person has the right, contractual or otherwise,
to cause the Company to register under the Act any shares of Common Stock
or shares of any other capital stock of or other equity interests in the
Company, or to include any such shares or interests in the Registration
Statement or the offering contemplated thereby;
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(p) each of the Company and the Subsidiaries has all necessary
licenses, authorizations, consents and approvals and has made all
necessary filings required under any applicable law, regulation or rule,
and has obtained all necessary licenses, authorizations, consents and
approvals from other persons, in order to conduct its businesses in the
manner described in the Registration Statement, each Preliminary
Prospectus, the Prospectus or any Permitted Free Writing Prospectus,
except where such failure to hold such licenses, authorizations, consents
and approvals would not, individually or in the aggregate, reasonably be
expected to result in a Material Adverse Effect; neither the Company nor
any of the Subsidiaries is in violation of, or in default under, or has
received notice of any proceedings relating to revocation or modification
of, any such license, authorization, consent or approval or any federal,
state, local or foreign law, regulation or rule or any decree, order or
judgment applicable to the Company or any of the Subsidiaries, except
where such violation, default, revocation or modification would not,
individually or in the aggregate, reasonably be expected to result in
Material Adverse Effect;
(q) there are no actions, suits, claims, investigations or
proceedings pending or, to the Company's Knowledge, threatened to which
the Company or any of the Subsidiaries or any of their respective
directors or officers is or would be a party or of which any of their
respective properties is or would be subject at law or in equity, before
or by any federal, state, local or foreign governmental or regulatory
commission, board, body, authority or agency, or before or by any
self-regulatory organization or other non-governmental regulatory
authority (including, without limitation, the NASDAQ), except any such
action, suit, claim, investigation or proceeding which, if resolved
adversely to the Company or any Subsidiary, would not, individually or in
the aggregate, reasonably be expected to result in a Material Adverse
Effect;
(r) Ernst & Young LLP, whose report on the consolidated financial
statements of the Company and the Subsidiaries is included in the
Registration Statement, the Preliminary Prospectuses and the Prospectus,
is an independent registered public accounting firm as required by the Act
and by the rules of the Public Company Accounting Oversight Board;
(s) The financial statements included in the Registration Statement,
any Preliminary Prospectus, the Prospectus or any Permitted Free Writing
Prospectus, together with the related notes and schedules, present fairly
the consolidated financial position of the Company and the Subsidiaries as
of the dates indicated and the consolidated results of operations, cash
flows and changes in stockholders' equity of the Company for the periods
specified and have been prepared in compliance with the requirements of
the Act and Exchange Act and in conformity with U.S. generally accepted
accounting principles applied on a consistent basis (except as disclosed
therein) during the periods involved; all pro forma financial data
included in the Registration Statement, any Preliminary Prospectus, the
Prospectus or any Permitted Free Writing Prospectus comply with the
requirements of the Act and the Exchange Act, and the assumptions used in
the preparation of such pro forma financial data are reasonable, the pro
forma adjustments used therein are appropriate to give effect to the
transactions or circumstances described therein and the pro forma
adjustments have been properly applied to the historical amounts in the
compi-
-10-
lation of those statements and data; the other financial and statistical
data contained in the Registration Statement, any Preliminary Prospectus,
the Prospectus or any Permitted Free Writing Prospectus are accurately and
fairly presented and prepared on a basis consistent in all material
respects with the financial statements and books and records of the
Company; there are no financial statements (historical or pro forma) that
are required to be included in the Registration Statement, any Preliminary
Prospectus or the Prospectus that are not included as required; the
Company and the Subsidiaries do not have any material liabilities or
obligations, direct or contingent (including any off-balance sheet
obligations), that are required to be described in the Registration
Statement (excluding the exhibits thereto), any Preliminary Prospectus or
the Prospectus that are not so described; and all disclosures contained in
the Registration Statement, any Preliminary Prospectus, the Prospectus or
any Permitted Free Writing Prospectus regarding "non-GAAP financial
measures" (as such term is defined by the rules and regulations of the
Commission) comply in all material respects with Regulation G of the
Exchange Act and Item 10 of Regulation S-K under the Act, to the extent
applicable;
(t) subsequent to the respective dates as of which information is
given in the Registration Statement, the Preliminary Prospectuses, the
Prospectus and the Permitted Free Writing Prospectuses, if any, in each
case excluding any amendments or supplements to the foregoing made after
the execution of this Agreement, there has not been (i) any material
adverse change in the business, properties, financial condition or results
of operations of the Company and the Subsidiaries taken as a whole, (ii)
any obligation or liability, direct or contingent (including any
off-balance sheet obligations), incurred by the Company or any Subsidiary,
which is material to the Company and the Subsidiaries taken as a whole,
(iii) any change in the capital stock (other than the exercise of options
or the granting of restricted stock or options as disclosed in the
Registration Statement and each Preliminary Prospectus) or material
increase in outstanding indebtedness of the Company, or (iv) any dividend
or distribution of any kind declared, paid or made on the capital stock of
the Company or any Subsidiary;
(u) the Company has obtained for the benefit of the Underwriters the
agreement (a "Lock-Up Agreement"), in the form set forth as Exhibit A
hereto, of (i) each of its directors and "officers" (within the meaning of
Rule 16a-1(f) under the Exchange Act), (ii) JLL Partners Fund IV, L.P. and
(iii) each Directed Share Participant purchasing more than 500 Shares;
(v) neither the Company nor any Subsidiary is, and, upon the
issuance and sale of the Shares as herein contemplated and the application
of the net proceeds therefrom as described in the Registration Statement,
any Preliminary Prospectus or the Prospectus, none of them will be
required to be registered as, an "investment company" or an entity
"controlled" by an "investment company," as such terms are defined within
the meaning of the Investment Company Act of 1940, as amended (the
"Investment Company Act");
(w) the Company and each of the Subsidiaries have good title to all
property (real and personal) described the Registration Statement, any
Preliminary Prospectus, the
-11-
Prospectus or any Permitted Free Writing Prospectus as being owned by any
of them, free and clear of all liens, claims, security interests or other
encumbrances; except (i) such as do not materially interfere with the use
presently made of such property by the Company or such Subsidiary, (ii) as
created or permitted by any of the Credit Documents and (iii) liens
described in the Registration Statement, any Preliminary Prospectus, the
Prospectus or any Permitted Free Writing Prospectus. All property
described in the Registration Statement, any Preliminary Prospectus, the
Prospectus or any Permitted Free Writing Prospectus as being held under
lease by the Company or a Subsidiary is held thereby under valid,
subsisting and enforceable leases with such exceptions as do not
materially interfere with the use presently made of such property by the
Company or such Subsidiary;
(x) the Company and the Subsidiaries own, or have obtained valid and
enforceable licenses for, or other rights to use, the inventions, patent
applications, patents, trademarks (both registered and unregistered),
tradenames, service names, copyrights, trade secrets and other proprietary
information described in the Registration Statement, any Preliminary
Prospectus, the Prospectus or any Permitted Free Writing Prospectus as
being owned or licensed by them or which are necessary for the conduct of
their respective businesses as currently conducted or as proposed to be
conducted, except where the failure to own, license or have such rights
would not, individually or in the aggregate, reasonably be expected to
result in a Material Adverse Effect (collectively, "Intellectual
Property"); (i) there are no third parties who have or, to the Company's
Knowledge, will be able to establish rights to any Intellectual Property,
except for, and to the extent of, the ownership rights of the owners of
the Intellectual Property licensed to the Company; (ii) to the Company's
Knowledge, there is no infringement by third parties of any Intellectual
Property; (iii) there is no pending or, to the Company's Knowledge,
threatened action, suit, proceeding or claim by others challenging the
Company's rights in or to any Intellectual Property; (iv) there is no
pending or, to the Company's Knowledge, threatened action, suit,
proceeding or claim by others challenging the validity, enforceability or
scope of any Intellectual Property; (v) there is no pending or, to the
Company's Knowledge, threatened action, suit, proceeding or claim by
others that the Company or any Subsidiary infringes or otherwise violates
any patent, trademark, tradename, service name, copyright, trade secret or
other proprietary rights of others; (vi) the Company and the Subsidiaries
have complied in all material respects with the terms of each agreement
pursuant to which Intellectual Property has been licensed to the Company
or any Subsidiary, and all such agreements are in full force and effect;
and (vii) to the Company's Knowledge, there is no patent or patent
application that contains claims that interfere with the issued or pending
claims of any of the Intellectual Property or that challenges the
validity, enforceability or scope of any of the Intellectual Property;
(y) except for matters which would not, individually or in the
aggregate, be reasonably expected to result in a Material Adverse Effect,
(i) neither the Company nor any of the Subsidiaries is engaged in any
unfair labor practice, (ii) there is (A) no unfair labor practice
complaint pending or, to the Company's Knowledge, threatened against the
Company or any of the Subsidiaries before the National Labor Relations
Board, and no grievance or arbitration proceeding arising out of or under
collective bargaining agree-
-12-
ments is pending or, to the Company's Knowledge, threatened, (B) no
strike, labor dispute, slowdown or stoppage pending or, to the Company's
Knowledge, threatened against the Company or any of the Subsidiaries and
(C) no union representation dispute currently existing concerning the
employees of the Company or any of the Subsidiaries, (iii) to the
Company's Knowledge, no union organizing activities are currently taking
place concerning the employees of the Company or any of the Subsidiaries,
and (iv) there has been no violation of any federal, state, local or
foreign law relating to discrimination in the hiring, promotion or pay of
employees, any applicable wage or hour laws or any provision of the
Employee Retirement Income Security Act of 1974 ("ERISA") or the rules and
regulations promulgated thereunder concerning the employees of the Company
or any of the Subsidiaries;
(z) the Company and the Subsidiaries and their respective
properties, assets and operations are in compliance with, and the Company
and each of the Subsidiaries hold all permits, authorizations and
approvals required under, Environmental Laws (as defined below), except to
the extent that failure to so comply or to hold such permits,
authorizations or approvals would not, individually or in the aggregate,
be reasonably expected to result in a Material Adverse Effect; there are
no past or present events, conditions, circumstances, activities,
practices, actions, omissions or plans that could reasonably be expected
to give rise to any material costs or liabilities to the Company or any
Subsidiary under, or to interfere with or prevent compliance by the
Company or any Subsidiary with, Environmental Laws; except as would not,
individually or in the aggregate, be reasonably expected to result in a
Material Adverse Effect, neither the Company nor any of the Subsidiaries
(i) is the subject of any investigation, (ii) has received any notice or
claim, (iii) is a party to any pending or, to the Company's Knowledge,
threatened action, suit or proceeding, (iv) is bound by any judgment,
decree or order or (v) has entered into any agreement, in each case
relating to any alleged violation of any Environmental Law or any actual
or alleged release or threatened release or cleanup at any location of any
Hazardous Materials (as defined below) (as used herein, "Environmental
Law" means any federal, state, local or foreign law, statute, ordinance,
rule, regulation, order, decree, judgment, injunction, permit, license,
authorization or other binding requirement, or common law, relating to
health, safety or the protection, cleanup or restoration of the
environment or natural resources, including those relating to the
distribution, processing, generation, treatment, storage, disposal,
transportation, other handling or release or threatened release of
Hazardous Materials, and "Hazardous Materials" means any material
(including, without limitation, pollutants, contaminants, hazardous or
toxic substances or wastes) that is regulated by or may give rise to
liability under any Environmental Law);
(aa) (i) all tax returns required to be filed by the Company or any
of the Subsidiaries have been timely filed, and (ii) all taxes and other
assessments of a similar nature (whether imposed directly or through
withholding) including any interest, additions to tax or penalties
applicable thereto due or claimed to be due from such entities have been
timely paid, except (i) any such taxes, assessments, interest, additions
or penalties that would not, individually or in the aggregate, reasonably
be expected to result in a Ma-
-13-
terial Adverse Effect, or (ii) those being contested in good faith and
for which adequate reserves have been provided;
(bb) the Company and each of the Subsidiaries maintain insurance
covering their respective properties, operations, personnel and businesses
as the Company reasonably deems adequate; such insurance insures against
such losses and risks to an extent which is adequate in accordance with
customary industry practice to protect the Company and the Subsidiaries
and their respective businesses; all such insurance is fully in force on
the date hereof and will be fully in force at the time of purchase and any
additional time of purchase; neither the Company nor its Subsidiaries has
received a written notice of cancellation with respect to any existing
insurance;
(cc) neither the Company nor any of the Subsidiaries has sustained
since the date of the last audited consolidated financial statements of
the Company included in the Registration Statement, any Preliminary
Prospectuses and the Prospectus any material loss or interference with its
business from fire, explosion, flood or other calamity, whether or not
covered by insurance, or from any labor dispute or court or governmental
action, order or decree;
(dd) neither the Company nor any Subsidiary has sent or received any
communication regarding termination of, or intent not to renew, any of the
contracts or agreements referred to or described in any Preliminary
Prospectus, the Prospectus or any Permitted Free Writing Prospectus, or
referred to or described in, or filed as an exhibit to, the Registration
Statement, and no such termination or non-renewal has been threatened by
the Company or any Subsidiary or, to the Company's Knowledge, any other
party to any such contract or agreement;
(ee) the Company and each of the Subsidiaries maintain a system of
internal accounting controls sufficient to provide reasonable assurance
that (A) transactions are executed in accordance with management's general
or specific authorization; (B) transactions are recorded as necessary to
permit preparation of financial statements in conformity with generally
accepted accounting principles and to maintain accountability for assets;
(C) access to assets is permitted only in accordance with management's
general or specific authorization; and (D) the recorded accountability for
assets is compared with existing assets at reasonable intervals and
appropriate action is taken with respect to any differences;
(ff) to the extent applicable to it prior to the date hereof, there
is and has been no failure on the part of the Company and, to the
Company's Knowledge, any of the Company's directors or officers, in their
capacities as such, to comply with any provision of the Xxxxxxxx-Xxxxx Act
of 2002 and the rules and regulations promulgated thereunder;
(gg) each "forward-looking statement" (within the meaning of Section
27A of the Act or Section 21E of the Exchange Act) contained in the
Registration Statement, any Preliminary Prospectus, the Prospectus or any
Permitted Free Writing Prospectus has been made or reaffirmed with a
reasonable basis and in good faith;
-14-
(hh) all statistical or market-related data included in the
Registration Statement, any Preliminary Prospectus, the Prospectus or any
Permitted Free Writing Prospectus are based on or derived from sources
that the Company believes to be reliable and accurate, and the Company has
obtained the written consent to the use of such data from such sources to
the extent required;
(ii) neither the Company nor any of the Subsidiaries nor, to the
Company's Knowledge, any employee or agent of the Company or any
Subsidiary has made any payment of funds of the Company or any Subsidiary
or received or retained any funds in violation of any law, rule or
regulation (including, without limitation, the Foreign Corrupt Practices
Act of 1977), which payment, receipt or retention of funds is of a
character required to be disclosed in the Registration Statement, any
Preliminary Prospectus or the Prospectus;
(jj) no Subsidiary is currently prohibited, directly or indirectly,
from paying any dividends to the Company, from making any other
distribution on such Subsidiary's capital stock, from repaying to the
Company any loans or advances to such Subsidiary from the Company or from
transferring any of such Subsidiary's property or assets to the Company or
any other Subsidiary of the Company, except as described in the
Registration Statement (excluding the exhibits thereto), each Preliminary
Prospectus and the Prospectus;
(kk) the issuance and sale of the Shares to be sold by the Company
as contemplated hereby will not cause any holder of any shares of capital
stock, securities convertible into or exchangeable or exercisable for
capital stock or options, warrants or other rights to purchase capital
stock or any other securities of the Company to have any right to acquire
any shares of preferred stock of the Company;
(ll) except pursuant to this Agreement, neither the Company nor any
of the Subsidiaries has incurred any liability for any finder's or
broker's fee or agent's commission in connection with the execution and
delivery of this Agreement or the consummation of the transactions
contemplated hereby or by the Registration Statement;
(mm) neither the Company nor, to the Company's Knowledge, any of its
affiliates (within the meaning of Rule 144 under the Act) (each, an
"Affiliate") has taken any action designed to effect, or which has
constituted or might reasonably be expected to result in, the
stabilization or manipulation of the price of any security of the Company
to facilitate the sale or resale of the Shares;
(nn) to the Company's Knowledge, there are no affiliations or
associations between (i) any member of the NASD and (ii) the Company or
any of the Company's officers, directors or 5% or greater security holders
or any beneficial owner of the Company's unregistered equity securities
that were acquired at any time on or after the 180th day immediately
preceding the date the Registration Statement was initially filed with the
Commission, except as disclosed in the Registration Statement (excluding
the exhibits thereto), the Preliminary Prospectuses and the Prospectus;
-15-
(oo) the Registration Statement, each Preliminary Prospectus, the
Prospectus and each Permitted Free Writing Prospectus comply, and any
further amendments or supplements thereto will comply, with any applicable
laws or regulations of any foreign jurisdiction in which any Preliminary
Prospectus, the Prospectus or any Permitted Free Writing Prospectus is
distributed in connection with the Directed Share Program; and no
approval, authorization, consent or order of or filing with any
governmental or regulatory commission, board, body, authority or agency,
other than those heretofore obtained, is required in connection with the
offering of the Reserved Shares in any jurisdiction where the Reserved
Shares are being offered; and
(pp) the Company has not offered, or caused the Underwriters to
offer, Shares to any person pursuant to the Directed Share Program with
the intent to influence unlawfully (i) a customer or supplier of the
Company or any of the Subsidiaries to alter the customer's or supplier's
level or type of business with the Company or any of the Subsidiaries, or
(ii) a trade journalist or publication to write or publish favorable
information about the Company or any of the Subsidiaries or any of their
respective products or services.
In addition, any certificate signed by any officer of the Company or
any of the Subsidiaries and delivered to the Underwriters or counsel for the
Underwriters in connection with the offering of the Shares shall be deemed to be
a representation and warranty by the Company, as to matters covered thereby, to
each Underwriter.
4. Certain Covenants of the Company. The Company hereby agrees:
(a) to furnish such information as may be required and otherwise to
cooperate in qualifying the Shares for offering and sale under the
securities or blue sky laws of such states or other jurisdictions as you
may designate and to maintain such qualifications in effect so long as you
may request for the distribution of the Shares; provided, however, that
the Company shall not be required to qualify as a foreign corporation or
to consent to the service of process under the laws of any such
jurisdiction (except service of process with respect to the offering and
sale of the Shares) or execute a general consent or take any action,
except as expressly required hereby, that could subject it to service of
process in any such jurisdiction or subject itself to taxation in excess
of a nominal dollar amount in any such jurisdiction where it is not then
so subject; and to promptly advise you of the receipt by the Company of
any notification with respect to the suspension of the qualification of
the Shares for offer or sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose;
(b) to make available to the Underwriters in New York City, as soon
as practicable after this Agreement becomes effective, and thereafter from
time to time to furnish to the Underwriters, as many copies of the
Prospectus (or of the Prospectus as amended or supplemented if the Company
shall have made any amendments or supplements thereto after the effective
date of the Registration Statement) as the Underwriters may request for
the purposes contemplated by the Act; in case any Underwriter is required
to deliver (whether physically or through compliance with Rule 172 under
the Act or any similar rule) a prospectus after the nine-month period
referred to in Section
-16-
10(a)(3) of the Act in connection with the sale of the Shares, the Company
will prepare, at its expense, promptly upon request such amendment or
amendments to the Registration Statement and the Prospectus as may be
necessary to permit compliance with the requirements of Section 10(a)(3)
of the Act;
(c) if, at the time this Agreement is executed and delivered, it is
necessary for a post-effective amendment to the Registration Statement, or
a Registration Statement under Rule 462(b) under the Act, to be filed with
the Commission and become effective before the Shares may be sold, the
Company will use its best efforts to cause such post-effective amendment
or such Registration Statement to be filed and become effective as soon as
possible, and the Company will advise you promptly and, if requested by
you, will confirm such advice in writing, (i) when such post-effective
amendment or such Registration Statement has become effective, and (ii) if
Rule 430A under the Act is used, when the Prospectus is filed with the
Commission pursuant to Rule 424(b) under the Act (which the Company agrees
to file in a timely manner in accordance with such Rules);
(d) to advise you promptly, confirming such advice in writing, of
any request by the Commission for amendments or supplements to the
Registration Statement or the Exchange Act Registration Statement, any
Preliminary Prospectus, the Prospectus or any Permitted Free Writing
Prospectus or for additional information with respect thereto, or of
notice of institution of proceedings for, or the entry of a stop order,
suspending the effectiveness of the Registration Statement and, if the
Commission should enter a stop order suspending the effectiveness of the
Registration Statement, to use its best efforts to obtain the lifting or
removal of such order as soon as possible; to advise you promptly of any
proposal to amend or supplement the Registration Statement or the Exchange
Act Registration Statement, any Preliminary Prospectus or the Prospectus,
and to provide you and Underwriters' counsel copies of any such documents
for review and comment a reasonable amount of time prior to any proposed
filing and to file no such amendment or supplement to which you shall
object in writing;
(e) subject to Section 4(d) hereof, to timely file all reports and
documents and any preliminary or definitive proxy or information statement
required to be filed by the Company with the Commission in order to comply
with the Exchange Act for so long as a prospectus is required by the Act
to be delivered (whether physically or through compliance with Rule 172
under the Act or any similar rule) in connection with any sale of Shares;
and to provide you with a copy of such reports and statements and other
documents to be filed by the Company pursuant to Section 13, 14 or 15(d)
of the Exchange Act during such period a reasonable amount of time prior
to any proposed filing, and to promptly notify you of such filing;
(f) if necessary or appropriate, to file a registration statement
pursuant to, and in accordance with, Rule 462(b) under the Act and pay the
applicable fees in accordance with the Act;
(g) to advise the Underwriters promptly of the happening of any
event within the period during which a prospectus is required by the Act
to be delivered (whether
-17-
physically or through compliance with Rule 172 under the Act or any
similar rule) in connection with any sale of Shares, which event could
require the making of any change in the Prospectus then being used so that
the Prospectus would not include an untrue statement of material fact or
omit to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they are made, not
misleading, and, during such time, subject to Section 4(d) hereof, to
prepare and furnish, at the Company's expense, to the Underwriters
promptly such amendments or supplements to such Prospectus as may be
necessary to reflect any such change;
(h) to make generally available to its security holders, and to
deliver to you, an earnings statement of the Company (which will satisfy
the provisions of Section 11(a) of the Act) covering a period of twelve
months beginning after the effective date of the Registration Statement
(as defined in Rule 158(c) under the Act) as soon as is reasonably
practicable after the termination of such twelve-month period but in any
case not later than [ ], 2007;
(i) to furnish to you five copies of the Registration Statement, as
initially filed with the Commission, and of all amendments thereto
(including all exhibits thereto and sufficient copies of the foregoing
(other than exhibits) for distribution of a copy to each of the other
Underwriters and their counsel;
(j) to furnish to you as early as practicable prior to the time of
purchase and any additional time of purchase, as the case may be, but not
later than two business days prior thereto, a copy of the latest available
unaudited interim and monthly consolidated financial statements, if any,
of the Company and the Subsidiaries which have been read by the Company's
independent registered public accounting firm, as stated in their letter
to be furnished pursuant to Section 7(b) hereof;
(k) to apply the net proceeds to the Company from the sale of the
Shares in the manner set forth under the caption "Use of proceeds" in the
Prospectus and to file such reports with the Commission with respect to
the sale of the Shares and the application of the proceeds therefrom as
may be required by Rule 463 under the Act;
(l) to comply with Rule 433(g) under the Act;
(m) beginning on the date hereof and ending on, and including, the
date that is 180 days after the date hereof (the "Lock-Up Period"),
without the prior written consent of DBSI and X.X. Xxxxxx Securities Inc.
("JPM"), not to (i) sell, offer to sell, contract or agree to sell,
hypothecate, pledge, grant any option to purchase or otherwise dispose of
or agree to dispose of, directly or indirectly, or establish or increase a
put equivalent position or liquidate or decrease a call equivalent
position within the meaning of Section 16 of the Exchange Act and the
rules and regulations of the Commission promulgated thereunder, with
respect to, any Common Stock or securities convertible into or
exchangeable or exercisable for Common Stock or warrants or other rights
to purchase Common Stock or any other securities of the Company that are
substantially similar to Common Stock, (ii) file or cause to become
effective a registration statement under the Act (other than a
-18-
Registration Statement on Form S-8) relating to the offer and sale of any
shares of Common Stock or securities convertible into or exercisable or
exchangeable for Common Stock or warrants or other rights to purchase
Common Stock or any other securities of the Company that are substantially
similar to Common Stock, (iii) enter into any swap or other arrangement
that transfers to another, in whole or in part, any of the economic
consequences of ownership of Common Stock or any securities convertible
into or exercisable or exchangeable for Common Stock, or warrants or other
rights to purchase Common Stock or any such securities, whether any such
transaction is to be settled by delivery of Common Stock or such other
securities, in cash or otherwise or (iv) publicly announce an intention to
effect any transaction specified in clause (i), (ii) or (iii), except, in
each case, for (A) the registration of the offer and sale of the Shares as
contemplated by this Agreement, (B) issuances of Common Stock upon the
exercise of options or warrants disclosed as outstanding in the
Registration Statement (excluding the exhibits thereto), each Preliminary
Prospectus and the Prospectus, (C) issuances of restricted Common Stock
issued in connection with one or more acquisitions, mergers or other
business combination transactions with any entity other than a publicly
traded corporation whose common equity is listed on a national securities
exchange or quoted on The Nasdaq National Market; provided, however, that
(x) such restricted Common Stock cannot be registered at any time during
the Lock-Up Period and (y) each Person to whom such restricted Common
Stock is issued shall have executed for the benefit of the Underwriters a
Lock-Up Agreement, in the form set forth as Exhibit A hereto; provided,
however, that such Lock-Up Agreement shall remain in effect only from the
date it is executed until the expiration of the Lock-Up Period, and (D)
the issuance of restricted shares of Common Stock and stock options to
directors, officers and employees not exercisable during the Lock-Up
Period pursuant to stock option plans described in the Registration
Statement (excluding the exhibits thereto), each Preliminary Prospectus
and the Prospectus; provided, however, that if (a) during the period that
begins on the date that is fifteen (15) calendar days plus three (3)
business days before the last day of the Lock-Up Period and ends on the
last day of the Lock-Up Period, the Company issues an earnings release or
material news or a material event relating to the Company occurs; or (b)
prior to the expiration of the Lock-Up Period, the Company announces that
it will release earnings results during the sixteen (16) day period
beginning on the last day of the Lock-Up Period, then the restrictions
imposed by this Section 4(m) shall continue to apply until the expiration
of the date that is fifteen (15) calendar days plus three (3) business
days after the date on which the issuance of the earnings release or the
material news or material event occurs;
(n) prior to the time of purchase or any additional time of
purchase, as the case may be, to issue no press release or other
communication directly or indirectly and hold no press conferences with
respect to the Company or any Subsidiary, the financial condition, results
of operations, business, properties, assets, or liabilities of the Company
or any Subsidiary, or the offering of the Shares, without your prior
consultation;
(o) not, at any time at or after the execution of this Agreement, to
offer or sell any Shares by means of any "prospectus" (within the meaning
of the Act), or use any "prospectus" (within the meaning of the Act) in
connection with the offer or sale of the Shares, in each case other than
the Prospectus;
-19-
(p) the Company will not, and will cause its Subsidiaries not to,
take, directly or indirectly, any action designed, or which will
constitute, or has constituted, or might reasonably be expected to cause
or result in the stabilization or manipulation of the price of any
security of the Company to facilitate the sale or resale of the Shares;
(q) to use its best efforts to cause the Common Stock to be listed
for quotation on the NASDAQ and to maintain such listing;
(r) to maintain a transfer agent and, if necessary under the
jurisdiction of incorporation of the Company, a registrar for the Common
Stock; and
(s) to cause each Directed Share Participant acquiring more than 500
Shares to execute a Lock-Up Agreement and otherwise to cause the Reserved
Shares to be restricted from sale, transfer, assignment, pledge or
hypothecation to such extent as may be required by the NASD and its rules,
and to direct the transfer agent to place stop transfer restrictions upon
such Reserved Shares during the Lock-Up Period or any such longer period
of time as may be required by the NASD and its rules; and to comply with
all applicable securities and other laws, rules and regulations in each
jurisdiction in which the Reserved Shares are offered in connection with
the Directed Share Program.
5. Covenant to Pay Costs. The Company agrees to pay all costs,
expenses, fees and taxes (other than fees and disbursements of counsel for the
Underwriters except to the extent set forth under Section 6 hereof or (iv) or
(vi) or (xi) below), in connection with (i) the preparation and filing of the
Registration Statement, each Preliminary Prospectus, the Prospectus, each
Permitted Free Writing Prospectus and any amendments or supplements thereto, and
the printing and furnishing of copies of each thereof to the Underwriters and to
dealers (including costs of mailing and shipment), (ii) the registration, issue,
sale and delivery of the Shares including any stock or transfer taxes and stamp
or similar duties payable upon the sale, issuance or delivery of the Shares to
the Underwriters, (iii) the producing, word processing and/or printing of this
Agreement, any Agreement Among Underwriters, any dealer agreements, and any
closing documents (including compilations thereof) and the reproduction and/or
printing and furnishing of copies of each thereof to the Underwriters and
(except closing documents) to dealers (including costs of mailing and shipment),
(iv) the qualification of the Shares for offering and sale under state or
foreign laws and the determination of their eligibility for investment under
state or foreign law to the extent required hereunder (including the reasonable
legal fees and filing fees and other disbursements of counsel for the
Underwriters) and the printing and furnishing of copies of any blue sky surveys
or legal investment surveys to the Underwriters and to dealers, (v) any listing
of the Shares on any securities exchange or qualification of the Shares for
quotation on the NASDAQ and any registration thereof under the Exchange Act,
(vi) any filing for review of the public offering of the Shares by the NASD,
including the reasonable legal fees and filing fees and other disbursements of
counsel to the Underwriters relating to NASD matters, (vii) the fees and
disbursements of any transfer agent or registrar for the Shares, (viii) the
costs and expenses of the Company relating to presentations or meetings
undertaken in connection with the marketing of the offering and sale of the
Shares to prospective investors and the Underwriters' sales forces, including,
without limitation, expenses associated with the production of road show slides
and graphics, fees and expenses of any consultants engaged in connection with
the road show
-20-
presentations, travel, lodging and other expenses incurred by the officers of
the Company and any such consultants, and the cost of any aircraft chartered in
connection with the road show, (ix) the costs and expenses of qualifying the
Shares for inclusion in the book-entry settlement system of the DTC, (x) the
preparation and filing of the Exchange Act Registration Statement, including any
amendments thereto, (xi) the offer and sale of the Reserved Shares, including
all costs and expenses of DB-DSP and the Underwriters, including the reasonable
fees and disbursement of counsel for the Underwriters and (xii) the performance
of the Company's other obligations hereunder, provided, however, that except as
provided in Sections 5, 6 and 10 hereof, the Underwriters will pay all of their
own costs and expenses, including the fees and expenses of their counsel.
6. Reimbursement of Underwriters' Expenses. If the Shares are not
delivered for any reason other than the termination of this Agreement pursuant
to the fifth paragraph of Section 9 hereof or the default by one or more of the
Underwriters in its or their respective obligations hereunder, the Company
shall, in addition to paying the amounts described in Section 5 hereof,
reimburse the Underwriters for all of their out-of-pocket expenses, including
the fees and disbursements of their counsel.
7. Conditions of Underwriters' Obligations. The several obligations
of the Underwriters hereunder are subject to the accuracy of the respective
representations and warranties on the part of the Company on the date hereof, at
the time of purchase and, if applicable, at the additional time of purchase, the
performance by the Company of its obligations hereunder and to the following
exclusive list of additional conditions precedent:
(a) The Company shall furnish to you at the time of purchase and, if
applicable, at the additional time of purchase, an opinion and negative
assurance letter of Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP, counsel for
the Company, addressed to the Underwriters, and dated the time of purchase
or the additional time of purchase, as the case may be, with executed
copies for each of the other Underwriters, and in form and substance
reasonably satisfactory to DBSI and JPM, in the form set forth in Exhibits
B-1 and B-2 hereto.
(b) You shall have received from Ernst & Young LLP letters dated,
respectively, the date of this Agreement (covering, in separate letters,
the Disclosure Package and the Prospectus), the time of purchase (covering
the Prospectus) and, if applicable, the additional time of purchase
(covering the Prospectus), and addressed to the Underwriters (with
executed copies for each of the Underwriters) in forms reasonably
satisfactory to DBSI and JPM.
(c) You shall have received at the time of purchase and, if
applicable, at the additional time of purchase, an opinion and negative
assurance letter of Xxxxxx Xxxxxx & Xxxxxxx LLP, counsel for the
Underwriters, dated the time of purchase or the additional time of
purchase, as the case may be, in form and substance reasonably
satisfactory to DBSI and JPM.
-21-
(d) No Prospectus or amendment or supplement to the Registration
Statement or the Prospectus shall have been filed to which you shall have
reasonably objected in writing.
(e) The Registration Statement, the Exchange Act Registration
Statement and any registration statement required to be filed, prior to
the sale of the Shares, under the Act pursuant to Rule 462(b) shall have
been filed and shall have become effective under the Act or the Exchange
Act, as the case may be. If Rule 430A under the Act is used, the
Prospectus shall have been filed with the Commission pursuant to Rule
424(b) under the Act at or before 5:30 P.M., New York City time, on the
second full business day after the date of this Agreement (or such earlier
time as may be required under the Act).
(f) Prior to the time of purchase, and, if applicable, the
additional time of purchase, (i) no stop order with respect to the
effectiveness of the Registration Statement shall have been issued under
the Act or proceedings initiated under Section 8(d) or 8(e) of the Act;
(ii) the Registration Statement and all amendments thereto shall 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 not misleading; (iii) none of the Preliminary Prospectuses or the
Prospectus, and no amendment or supplement thereto, shall include an
untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they are made, not misleading; (iv) no
Disclosure Package, and no amendment or supplement thereto, shall include
an untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they are made, not misleading; and (v) none of
the Permitted Free Writing Prospectuses, if any, shall include an untrue
statement of a material fact or omit to state a material fact necessary in
order to make the statements therein, in the light of the circumstances
under which they are made, not misleading.
(g) The Company will, at the time of purchase and, if applicable, at
the additional time of purchase, deliver to you a certificate of its Chief
Executive Officer and its Chief Financial Officer, dated the time of
purchase or the additional time of purchase, as the case may be, in the
form attached as Exhibit C hereto.
(h) You shall have received each of the signed Lock-Up Agreements
referred to in Section 3(u) hereof, and each such Lock-Up Agreement shall
be in full force and effect at the time of purchase and the additional
time of purchase, as the case may be.
(i) The Company shall have furnished to you such other documents and
certificates as to the accuracy and completeness of any statement in the
Registration Statement, any Preliminary Prospectus, the Prospectus or any
Permitted Free Writing Prospectus as of the time of purchase and, if
applicable, the additional time of purchase, as you may reasonably request
and as may be customary.
-22-
(j) The Shares shall have been approved for quotation on the NASDAQ,
subject only to notice of issuance and evidence of satisfactory
distribution at or prior to the time of purchase or the additional time of
purchase, as the case may be.
(k) The NASD shall not have raised any objection with respect to the
fairness or reasonableness of the underwriting, or other arrangements of
the transactions, contemplated hereby.
8. Effective Date of Agreement; Termination. This Agreement shall
become effective when the parties hereto have executed and delivered this
Agreement.
The obligations of the several Underwriters hereunder shall be subject to
termination in the absolute discretion of DBSI and JPM, if (1) since the time of
execution of this Agreement or the earlier respective dates as of which
information is given in the Registration Statement, the Preliminary
Prospectuses, the Prospectus and the Permitted Free Writing Prospectuses, if
any, there has been any material adverse change or any development involving a
prospective material adverse change in the business, properties, financial
condition or results of operations of the Company and the Subsidiaries taken as
a whole, which would, in the sole judgment of DBSI and JPM, make it
impracticable or inadvisable to proceed with the public offering or the delivery
of the Shares on the terms and in the manner contemplated in the Registration
Statement, the Preliminary Prospectuses, the Prospectus and the Permitted Free
Writing Prospectuses, if any, or (2) since the time of execution of this
Agreement, there shall have occurred: (A) a suspension or material limitation in
trading in securities generally on the NYSE, the American Stock Exchange or the
NASDAQ; (B) a suspension or material limitation in trading in the Company's
securities on the NASDAQ; (C) a general moratorium on commercial banking
activities declared by either federal or New York State authorities or a
material disruption in commercial banking or securities settlement or clearance
services in the United States; (D) an outbreak or escalation of hostilities or
acts of terrorism involving the United States or a declaration by the United
States of a national emergency or war; or (E) any other calamity or crisis or
any change in financial, political or economic conditions in the United States
or elsewhere, if the effect of any such event specified in clause (D) or (E), in
the sole judgment of DBSI and JPM, makes it impracticable or inadvisable to
proceed with the public offering or the delivery of the Shares on the terms and
in the manner contemplated in the Registration Statement, the Preliminary
Prospectuses, the Prospectus and the Permitted Free Writing Prospectuses, if
any, or (3) since the time of execution of this Agreement, there shall have
occurred any downgrading, or any notice or announcement shall have been given or
made of: (A) any intended or potential downgrading or (B) any watch, review or
possible change that does not indicate an affirmation or improvement in the
rating accorded any securities of or guaranteed by the Company or any Subsidiary
by any "nationally recognized statistical rating organization," as that term is
defined in Rule 436(g)(2) under the Act.
If DBSI and JPM elect to terminate this Agreement as provided in this
Section 8, the Company and each other Underwriter shall be notified promptly in
writing.
If the sale to the Underwriters of the Shares, as contemplated by this
Agreement, is not carried out by the Underwriters for any reason permitted under
this Agreement, or if such sale is not carried out because the Company shall be
unable to comply with any of the terms of
-23-
this Agreement, the Company shall not be under any obligation or liability under
this Agreement (except to the extent provided in Sections 5, 6 and 10 hereof),
and the Underwriters shall be under no obligation or liability to the Company
under this Agreement (except to the extent provided in Section 10 hereof) or to
one another hereunder.
9. Increase in Underwriters' Commitments. Subject to Sections 7 and 8
hereof, if any Underwriter shall default in its obligation to take up and pay
for the Firm Shares to be purchased by it hereunder (otherwise than for a
failure of a condition set forth in Section 7 hereof or a reason sufficient to
justify the termination of this Agreement under the provisions of Section 8
hereof) and if the number of Firm Shares which all Underwriters so defaulting
shall have agreed but failed to take up and pay for does not exceed 10% of the
total number of Firm Shares, the non-defaulting Underwriters (including the
Underwriters, if any, substituted in the manner set forth below) shall take up
and pay for (in addition to the aggregate number of Firm Shares they are
obligated to purchase pursuant to Section 1 hereof) the number of Firm Shares
agreed to be purchased by all such defaulting Underwriters, as hereinafter
provided. Such Shares shall be taken up and paid for by such non-defaulting
Underwriters in such amount or amounts as you may designate with the consent of
each Underwriter so designated or, in the event no such designation is made,
such Shares shall be taken up and paid for by all non-defaulting Underwriters
pro rata in proportion to the aggregate number of Firm Shares set forth opposite
the names of such non-defaulting Underwriters in Schedule A.
Without relieving any defaulting Underwriter from its obligations
hereunder, the Company agrees with the non-defaulting Underwriters that they
will not sell any Firm Shares hereunder unless all of the Firm Shares are
purchased by the Underwriters (or by substituted Underwriters selected by you
with the approval of the Company or selected by the Company with your approval).
If a new Underwriter or Underwriters are substituted by the Underwriters
or by the Company for a defaulting Underwriter or Underwriters in accordance
with the foregoing provision, the Company or you shall have the right to
postpone the time of purchase for a period not exceeding five business days in
order that any necessary changes in the Registration Statement and the
Prospectus and other documents may be effected.
The term "Underwriter" as used in this Agreement shall refer to and
include any Underwriter substituted under this Section 9 with like effect as if
such substituted Underwriter had originally been named in Schedule A hereto.
If the aggregate number of Firm Shares which the defaulting Underwriter or
Underwriters agreed to purchase exceeds 10% of the total number of Firm Shares
which all Underwriters agreed to purchase hereunder, and if neither the
non-defaulting Underwriters nor the Company shall make arrangements within the
five business day period stated above for the purchase of all the Firm Shares
which the defaulting Underwriter or Underwriters agreed to purchase hereunder,
this Agreement shall terminate without further act or deed and without any
liability on the part of the Company to any Underwriter and without any
liability on the part of any non-defaulting Underwriter to the Company. Nothing
in this paragraph, and no action taken
-24-
hereunder, shall relieve any defaulting Underwriter from liability in respect of
any default of such Underwriter under this Agreement.
10. Indemnity and Contribution.
(a) The Company agrees to indemnify, defend and hold harmless each
Underwriter, its partners, directors and officers, and any person who controls
any Underwriter within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act, and the successors and assigns of all of the foregoing persons,
from and against any loss, damage, expense, liability or claim (including the
reasonable cost of investigation) which, jointly or severally, any such
Underwriter or any such person may incur under the Act, the Exchange Act, the
common law or otherwise, insofar as such loss, damage, expense, liability or
claim arises out of or is based upon (i) any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement (or in the
Registration Statement as amended by any post-effective amendment thereof by the
Company) or arises out of or is based upon any omission or alleged omission to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading, except insofar as any such loss, damage,
expense, liability or claim arises out of or is based upon any untrue statement
or alleged untrue statement of a material fact contained in, and in conformity
with information concerning such Underwriter furnished in writing by or on
behalf of such Underwriter through you, to the Company expressly for use in, the
Registration Statement or arises out of or is based upon any omission or alleged
omission to state a material fact in the Registration Statement in connection
with such information, which material fact was not contained in such information
and which material fact was required to be stated in such Registration Statement
or was necessary to make such information not misleading or (ii) any untrue
statement or alleged untrue statement of a material fact included in any
Prospectus (the term Prospectus for the purpose of this Section 10 being deemed
to include any Preliminary Prospectus, the Prospectus and any amendments or
supplements to the foregoing), in any Permitted Free Writing Prospectus, in any
"issuer information" (as defined in Rule 433 under the Act) of the Company or in
any Prospectus together with any combination of one or more of the Permitted
Free Writing Prospectuses, if any, or arises out of or is based upon any
omission or alleged omission to state a material fact necessary in order to make
the statements therein, in the light of the circumstances under which they were
made, not misleading, except, with respect to such Prospectus or Permitted Free
Writing Prospectus, insofar as any such loss, damage, expense, liability or
claim arises out of or is based upon any untrue statement or alleged untrue
statement of a material fact contained in, and in conformity with information
concerning such Underwriter furnished in writing by or on behalf of such
Underwriter through you, to the Company expressly for use in, such Prospectus or
Permitted Free Writing Prospectus or arises out of or is based upon any omission
or alleged omission to state a material fact in such Prospectus or Permitted
Free Writing Prospectus in connection with such information, which material fact
was not contained in such information and which material fact was necessary in
order to make the statements in such information, in the light of the
circumstances under which they were made, not misleading or (iii) the Directed
Share Program, except, with respect to this clause (iii), insofar as such loss,
damage, expense, liability or claim is finally judicially determined to have
resulted from the gross negligence or willful misconduct of the Underwriters in
conducting the Directed Share Program.
-25-
Without limitation of and in addition to its obligations under the other
paragraphs of this Section 10, the Company agrees to indemnify, defend and hold
harmless DB-DSP and its partners, directors and officers, and any person who
controls DB-DSP within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act, and the successors and assigns of all of the foregoing persons,
from and against any loss, damage, expense, liability or claim (including the
reasonable cost of investigation) which, jointly or severally, DB-DSP or any
such person may incur under the Act, the Exchange Act, the common law or
otherwise, insofar as such loss, damage, expense, liability or claim (1) arises
out of or is based upon (a) any of the matters referred to in clauses (i)
through (iii) of the first paragraph of this Section 10(a), or (b) any untrue
statement or alleged untrue statement of a material fact contained in any
material prepared by or on behalf or with the consent of the Company for
distribution to Directed Share Participants in connection with the Directed
Share Program or caused by any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, (2) is or was caused by the failure of any Directed
Share Participant to pay for and accept delivery of Reserved Shares that the
Directed Share Participant has agreed to purchase, or (3) otherwise arises out
of or is based upon the Directed Share Program; provided, however, that the
Company shall not be responsible under this clause (3) for any loss, damage,
expense, liability or claim that is finally judicially determined to have
resulted from the gross negligence or willful misconduct of DB-DSP in conducting
the Directed Share Program. Section 10(c) shall apply equally to any Proceeding
(as defined below) brought against DB-DSP or any such person in respect of which
indemnity may be sought against the Company pursuant to the immediately
preceding sentence.
(b) Each Underwriter severally agrees to indemnify, defend and hold
harmless the Company, its directors and officers and any person who controls the
Company within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act, and the successors and assigns of all of the foregoing persons,
from and against any loss, damage, expense, liability or claim (including the
reasonable cost of investigation) which, jointly or severally, the Company or
any such person may incur under the Act, the Exchange Act, the common law or
otherwise, insofar as such loss, damage, expense, liability or claim arises out
of or is based upon (i) any untrue statement or alleged untrue statement of a
material fact contained in, and in conformity with information concerning such
Underwriter furnished in writing by or on behalf of such Underwriter through you
to the Company expressly for use in, the Registration Statement (or in the
Registration Statement as amended by any post-effective amendment thereof by the
Company), or arises out of or is based upon any omission or alleged omission to
state a material fact in such Registration Statement in connection with such
information, which material fact was not contained in such information and which
material fact was required to be stated in such Registration Statement or was
necessary to make such information not misleading or (ii) any untrue statement
or alleged untrue statement of a material fact contained in, and in conformity
with information concerning such Underwriter furnished in writing by or on
behalf of such Underwriter through you to the Company expressly for use in, a
Prospectus or a Permitted Free Writing Prospectus, or arises out of or is based
upon any omission or alleged omission to state a material fact in such
Prospectus or Permitted Free Writing Prospectus in connection with such
information, which material fact was not contained in such information and which
material fact was necessary in or-
-26-
der to make the statements in such information, in the light of the
circumstances under which they were made, not misleading.
(c) If any action, suit or proceeding (each, a "Proceeding") is brought
against a person (an "indemnified party") in respect of which indemnity may be
sought against the Company or an Underwriter (as applicable, the "indemnifying
party") pursuant to subsection (a) or (b), respectively, of this Section 10,
such indemnified party shall promptly notify such indemnifying party in writing
of the institution of such Proceeding and such indemnifying party shall assume
the defense of such Proceeding, including the employment of counsel reasonably
satisfactory to such indemnified party and payment of all fees and expenses;
provided, however, that the omission to so notify such indemnifying party shall
not relieve such indemnifying party from any liability which such indemnifying
party may have, except to the extent such omissions results in liability due to
(i) the forfeiture by such indemnifying party of substantial rights and
defenses, or (ii) material adverse prejudice to such indemnifying party. The
indemnified party or parties shall have the right to employ its or their own
counsel in any such case, but the fees and expenses of such counsel shall be at
the expense of such indemnified party or parties unless the employment of such
counsel shall have been authorized in writing by the indemnifying party in
connection with the defense of such Proceeding or the indemnifying party shall
not have, within a reasonable period of time in light of the circumstances,
employed counsel to defend such Proceeding or such indemnified party or parties
shall have reasonably concluded that there may be defenses available to it or
them which are different from, additional to or in conflict with those available
to such indemnifying party (in which case such indemnifying party shall not have
the right to direct the defense of such Proceeding on behalf of the indemnified
party or parties, but such indemnifying party may employ counsel and participate
in the defense thereof, but the fees and expenses of such counsel shall be at
the expense of such indemnifying party), in any of which events such reasonable
fees and expenses shall be borne by such indemnifying party and paid as incurred
(it being understood, however, that, except as provided in the second paragraph
of Section 10(a), such indemnifying party shall not be liable for the expenses
of more than one separate counsel (in addition to any local counsel) in any one
Proceeding or series of related Proceedings in the same jurisdiction
representing the indemnified parties who are parties to such Proceeding). The
indemnifying party shall not be liable for any settlement of any Proceeding
effected without its written consent but, if settled with its written consent,
such indemnifying party agrees to indemnify and hold harmless the indemnified
party or parties from and against any loss or liability by reason of such
settlement. No indemnifying party shall, without the prior written consent of
the indemnified party, effect any settlement of any pending or threatened
Proceeding in respect of which any indemnified party is or could have been a
party and indemnity could have been sought hereunder by such indemnified party,
unless such settlement includes an unconditional release of such indemnified
party from all liability on claims that are the subject matter of such
Proceeding and does not include an admission of fault or culpability or a
failure to act by or on behalf of such indemnified party.
(d) If the indemnification provided for in this Section 10 is unavailable
to an indemnified party under subsections (a) and (b) of this Section 10 or
insufficient to hold an indemnified party harmless in respect of any losses,
damages, expenses, liabilities or claims referred to therein, then each
applicable indemnifying party shall contribute to the amount paid or payable by
such indemnified party as a result of such losses, damages, expenses,
liabilities or
-27-
claims (i) in such proportion as is appropriate to reflect the relative benefits
received by the Company on the one hand and the Underwriters on the other hand
from the offering of the Shares or (ii) if the allocation provided by clause (i)
above is not permitted by applicable law, in such proportion as is appropriate
to reflect not only the relative benefits referred to in clause (i) above but
also the relative fault of the Company on the one hand and of the Underwriters
on the other in connection with the statements or omissions which resulted in
such losses, damages, expenses, liabilities or claims, as well as any other
relevant equitable considerations. The relative benefits received by the Company
on the one hand and the Underwriters on the other shall be deemed to be in the
same respective proportions as the total proceeds from the offering (net of
underwriting discounts and commissions but before deducting expenses) received
by the Company and the total underwriting discounts and commissions received by
the Underwriters bear to the aggregate public offering price of the Shares. The
relative fault of the Company on the one hand and of the Underwriters on the
other shall be determined by reference to, among other things, whether the
untrue statement or alleged untrue statement of a material fact or omission or
alleged omission relates to information supplied by the Company or by the
Underwriters and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission. The amount
paid or payable by a party as a result of the losses, damages, expenses,
liabilities and claims referred to in this subsection shall be deemed to include
any legal or other fees or expenses reasonably incurred by such party in
connection with investigating, preparing to defend or defending any Proceeding.
(e) The Company and the Underwriters agree that it could not be just and
equitable if contribution pursuant to this Section 10 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 that does not take account of the
equitable considerations referred to in subsection (d) above. Notwithstanding
the provisions of this Section 10, 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 such Underwriter and distributed to the public were
offered to the public exceeds the amount of any damage which such Underwriter
has otherwise been required to pay by reason of such untrue statement or alleged
untrue statement or omission or alleged omission. 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 to contribute pursuant to this
Section 10 are several in proportion to their respective underwriting
commitments and not joint.
(f) The indemnity and contribution agreements contained in this Section 10
and the covenants, warranties and representations of the Company contained in
this Agreement shall remain in full force and effect regardless of any
investigation made by or on behalf of any Underwriter, its partners, directors
or officers or any person (including each partner, officer or director of such
person) who controls any Underwriter within the meaning of Section 15 of the Act
or Section 20 of the Exchange Act, or by or on behalf of the Company, their
respective directors or officers or any person who controls the Company within
the meaning of Section 15 of the Act or Section 20 of the Exchange Act, and
shall survive any termination of this Agreement or the issuance and delivery of
the Shares to be sold by the Company pursuant hereto. The Company and each
Underwriter agree promptly to notify each other of the commencement of any
Proceeding against it and, in the case of the Company, against any of its
officers or directors in
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connection with the issuance and sale of the Shares, or in connection with
the Registration Statement, any Preliminary Prospectus, the Prospectus or any
Permitted Free Writing Prospectus.
11. Information Furnished by the Underwriters. The statements set forth in
the last paragraph on the cover page of the Prospectus and the statements set
forth in the first paragraph under the "Commissions and Discounts" heading and
the paragraphs under the "Price Stabilization, Short Positions" heading under
the caption "Underwriting" in the Prospectus, only insofar as such statements
relate to the amount of selling concession and reallowance or to over-allotment
and stabilization activities that may be undertaken by the Underwriters,
constitute the only information furnished by or on behalf of the Underwriters,
as such information is referred to in Sections 3 and 10 hereof.
12. Notices. Except as otherwise herein provided, all statements,
requests, notices and agreements shall be in writing or by telegram or facsimile
and, if to the Underwriters, shall be sufficient in all respects if delivered or
sent to Deutsche Bank Securities Inc., 00 Xxxx Xxxxxx, Xxx Xxxx, XX 00000,
Attention: [ ], Facsimile: [____], and, if to the Company, shall be sufficient
in all respects if delivered or sent to the Company at the offices of the
Company at 0000 Xxxxxxxxxx Xxxxx, Xxxxxxx, XX 00000, Attention: Xxxxx Xxxxxxxx
III, Vice President and Corporate Counsel, Facsimile: (000) 000-0000.
13. Governing Law; Construction. This Agreement and any claim,
counterclaim or dispute of any kind or nature whatsoever arising out of or in
any way relating to this Agreement ("Claim"), directly or indirectly, shall be
governed by, and construed in accordance with, the laws of the State of New
York. The section headings in this Agreement have been inserted as a matter of
convenience of reference and are not a part of this Agreement.
14. Submission to Jurisdiction. Except as set forth below, no Claim may be
commenced, prosecuted or continued in any court other than the courts of the
State of New York located in the City and County of New York or in the United
States District Court for the Southern District of New York, which courts shall
have jurisdiction over the adjudication of such matters, and the Company
consents to the jurisdiction of such courts and personal service with respect
thereto. The Company hereby consents to personal jurisdiction, service and venue
in any court in which any Claim arising out of or in any way relating to this
Agreement is brought by any third party against any Underwriter or any
indemnified party. Each Underwriter and the Company (on its behalf and, to the
extent permitted by applicable law, on behalf of its stockholders and
affiliates) waives all right to trial by jury in any action, proceeding or
counterclaim (whether based upon contract, tort or otherwise) in any way arising
out of or relating to this Agreement. The Company agrees that a final judgment
in any such action, proceeding or counterclaim brought in any such court shall
be conclusive and binding upon the Company and may be enforced in any other
courts to the jurisdiction of which the Company is or may be subject, by suit
upon such judgment.
15. Parties at Interest. The Agreement herein set forth has been and is
made solely for the benefit of the Underwriters and the Company and to the
extent provided in Section 10 hereof the controlling persons, partners,
directors and officers referred to in such Section, and their respective
successors, assigns, heirs, personal representatives and executors and
admin-
-29-
istrators. No other person, partnership, association or corporation (including a
purchaser, as such purchaser, from any of the Underwriters) shall acquire or
have any right under or by virtue of this Agreement.
16. No Fiduciary Relationship. The Company hereby acknowledges that the
Underwriters are acting solely as underwriters in connection with the purchase
and sale of the Company's securities. The Company further acknowledges that the
Underwriters are acting pursuant to a contractual relationship created solely by
this Agreement entered into on an arm's length basis, and in no event do the
parties intend that the Underwriters act or be responsible as a fiduciary to the
Company, its management, stockholders or creditors or any other person in
connection with any activity that the Underwriters may undertake or have
undertaken in furtherance of the purchase and sale of the Company's securities,
either before or after the date hereof. The Underwriters hereby expressly
disclaim any fiduciary or similar obligations to the Company, either in
connection with the transactions contemplated by this Agreement or any matters
leading up to such transactions, and the Company hereby confirms its
understanding and agreement to that effect. The Company and the Underwriters
agree that they are each responsible for making their own independent judgments
with respect to any such transactions and that any opinions or views expressed
by the Underwriters to the Company regarding such transactions, including, but
not limited to, any opinions or views with respect to the price or market for
the Company's securities, do not constitute advice or recommendations to the
Company. The Company hereby waives and releases, to the fullest extent permitted
by law, any claims that the Company may have against the Underwriters with
respect to any breach or alleged breach of any fiduciary or similar duty to the
Company in connection with the transactions contemplated by this Agreement or
any matters leading up to such transactions.
17. Counterparts. This Agreement may be signed by the parties in one or
more counterparts which together shall constitute one and the same agreement
among the parties.
18. Successors and Assigns. This Agreement shall be binding upon the
Underwriters and the Company and their successors and assigns and any successor
or assign of any substantial portion of the Company's or any of the
Underwriters' respective businesses and/or assets.
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If the foregoing correctly sets forth the understanding among the Company
and the several Underwriters, please so indicate in the space provided below for
that purpose, whereupon this Agreement and your acceptance shall constitute a
binding agreement among the Company and the Underwriters.
Very truly yours,
PGT, INC.
By:
-----------------------------------------
Name:
Title:
Accepted and agreed to as of the date
first above written, on behalf of
themselves and the other several
Underwriters named in
Schedule A
DEUTSCHE BANK SECURITIES INC.
X.X. XXXXXX SECURITIES INC.
JMP SECURITIES LLC
XXXXXXX XXXXX & ASSOCIATES, INC.
SUNTRUST XXXXXXXX XXXXXXXX CAPITAL MARKETS, INC.
By: DEUTSCHE BANK SECURITIES INC.
By:
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Name:
Title:
