xxxxxx.xxx, Inc.
_______Shares/1/
Common Stock
UNDERWRITING AGREEMENT
----------------------
________ ___, 1999
PRUDENTIAL SECURITIES INCORPORATED
XXXX XXXXXXXX XXXXXXX, a division of
Xxxx Xxxxxxxx Incorporated
XXXXX XXXXX XXXXXX & COMPANY
E*OFFERING CORP.
As Representatives of the several Underwriters
c/o Prudential Securities Incorporated
Xxx Xxx Xxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Each of xxxxxx.xxx, Inc., a Delaware corporation (the "Company"), the
shareholders of the Company named in Schedule 3 hereto (collectively, "Selling
Securityholders") and Xxxxx X. XxXxxxx and Xxxxxx Field (collectively, the "
Principal Selling Securityholders"), hereby confirms its agreement with the
several underwriters named in Schedule 1 hereto (the "Underwriters"), for whom
you have been duly authorized to act as representatives (in such capacities, the
"Representatives"), as set forth below. If you are the only Underwriters, all
references herein to the Representatives shall be deemed to be to the
Underwriters.
-------------------
/1/ Plus an option to purchase from xxxxxx.xxx, Inc. and the Selling
Securityholders up to _____________ additional shares to cover over-
allotments.
1. Securities. Subject to the terms and conditions herein contained, the
----------
Company and the Selling Securityholders propose to issue and sell to the several
Underwriters an aggregate of ___ shares (the "Firm Securities") of the Company's
Common Stock, par value $0.001 per share ("Common Stock"). The Company and the
Selling Securityholders also propose to issue and sell to the several
Underwriters not more than _______________ additional shares of Common Stock if
requested by the Representatives as provided in Section 4 of this Agreement.
Any and all shares of Common Stock to be purchased by the Underwriters pursuant
to such option are referred to herein as the "Option Securities," and the Firm
Securities and any Option Securities are collectively referred to herein as the
"Securities."
2.
3. Representations and Warranties of the Company and the Principal Selling
-----------------------------------------------------------------------
Securityholders. Each of the Company and the Principal Selling Securityholders
----------------
represents and warrants to, and agrees with, each of the several Underwriters
that:
4.
(a) A registration statement on Form S-1 (File No. 333-80639) with respect to
the Securities, including a prospectus subject to completion, has been
filed by the Company with the Securities and Exchange Commission (the
"Commission") under the Securities Act of 1933, as amended (the "Act"), and
one or more amendments to such registration statement has been so filed.
After the execution of this Agreement, the Company will file with the
Commission either (i) if such registration statement, as it has been
amended, has been declared by the Commission to be effective under the Act,
either (A) if the Company relies on Rule 434 under the Act, a Term Sheet
(as hereinafter defined) relating to the Securities, that shall identify
the Preliminary Prospectus (as hereinafter defined) that it supplements
containing such information as is required or permitted by Rules 434, 430A
and 424(b) under the Act or (B) if the Company does not rely on Rule 434
under the Act, a prospectus in the form most recently included in an
amendment to such registration statement (or, if no such amendment shall
have been filed, in such registration statement), with such changes or
insertions as are required by Rule 430A under the Act or permitted by Rule
424(b) under the Act, and in the case of either clause (i)(A) or (i)(B) of
this sentence as have been provided to and approved by the Representatives
prior to the execution of this Agreement, or (ii) if such registration
statement, as it has been amended, has not been declared by the Commission
to be effective under the Act, an amendment to such registration statement,
including a form of prospectus, a copy of which amendment has been
furnished to and approved by the Representatives prior to the execution of
this Agreement. The Company may also file a related registration statement
with the Commission pursuant to Rule 462(b) under the Act for the purpose
of registering certain additional Securities, which registration shall be
effective upon filing with the Commission. As used in this Agreement, the
term "Original Registration Statement" means the registration statement
initially filed relating to the Securities, as amended at the time when it
was or is declared effective, including all financial schedules and
exhibits thereto and including any information omitted therefrom pursuant
to Rule 430A under the Act and included in the Prospectus (as hereinafter
defined); the term "Rule 462(b) Registration Statement" means any
registration statement filed with the Commission pursuant to Rule 462(b)
under the Act (including the Registration Statement and any Preliminary
Prospectus or Prospectus incorporated therein at the time such Registration
Statement becomes effective); the term "Registration Statement" includes
both the Original Registration Statement and any Rule 462(b)
2
Registration Statement; the term "Preliminary Prospectus" means each
prospectus subject to completion filed with any such registration
statement or any amendment thereto (including the prospectus subject to
completion, if any, included in the Registration Statement or any
amendment thereto at the time it was or is declared effective); the term
"Prospectus" means: (b)
(A) if the Company relies on Rule 434 under the Act, the Term Sheet
relating to the Securities that is first filed pursuant to Rule
424(b)(7) under the Act, together with the Preliminary Prospectus
identified therein that such Term Sheet supplements;
(B) if the Company does not rely on Rule 434 under the Act, the
prospectus first filed with the Commission pursuant to Rule 424(b)
under the Act; or
(C) if the Company does not rely on Rule 434 under the Act and if no
prospectus is required to be filed pursuant to Rule 424(b) under the
Act, the prospectus included in the Registration Statement;
and the term "Term Sheet" means any term sheet that satisfies the requirements
of Rule 434 under the Act. Any reference herein to the "date" of a Prospectus
that includes a Term Sheet shall mean the date of such Term Sheet.
(a) The Commission has not issued any order preventing or suspending use of any
Preliminary Prospectus. When any Preliminary Prospectus was filed with the
Commission it (i) contained all statements required to be stated therein in
accordance with, and complied in all material respects with the
requirements of, the Act and the rules and regulations of the Commission
thereunder and (ii) did not include any untrue statement of a material fact
or omit to state any material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading. When the Registration Statement or any amendment
thereto was or is declared effective, it (i) contained or will contain all
statements required to be stated therein in accordance with, and complied
or will comply in all material respects with the requirements of, the Act
and the rules and regulations of the Commission thereunder and (ii) did not
or will not include any untrue statement of a material fact or omit to
state any material fact necessary to make the statements therein not
misleading. When the Prospectus or any Term Sheet that is a part thereof
or any amendment or supplement to the Prospectus is filed with the
Commission pursuant to Rule 424(b) (or, if the Prospectus or part thereof
or such amendment or supplement is not required to be so filed, when the
Registration Statement or the amendment thereto containing such amendment
or supplement to the Prospectus was or is declared effective) and on the
Firm Closing Date and any Option Closing Date (both as hereinafter
defined), the Prospectus, as amended or supplemented at any such time, (i)
contained or will contain all statements required to be stated therein in
accordance with, and complied or will comply in all material respects with
the requirements of, the Act and the rules and regulations of the
Commission thereunder and (ii) did not or will not include any untrue
statement of a material fact or omit to state any material fact necessary
in order to make the statements therein, in the light of the circumstances
under which they were made, not misleading. The foregoing provisions of
this
3
paragraph (b) do not apply to statements or omissions made in any
Preliminary Prospectus, the Registration Statement or any amendment
thereto or the Prospectus or any amendment or supplement thereto in
reliance upon and in conformity with written information furnished to the
Company by any Underwriter through the Representatives specifically for
use therein.
(b)
(c) If the Company has elected to rely on Rule 462(b) and the Rule 462(b)
Registration Statement has not been declared effective (i) the Company has
filed a Rule 462(b) Registration Statement in compliance with and that is
effective upon filing pursuant to Rule 462(b) and has received confirmation
of its receipt and (ii) the Company has given irrevocable instructions for
transmission of the applicable filing fee in connection with the filing of
the Rule 462(b) Registration Statement, in compliance with Rule 111
promulgated under the Act or the Commission has received payment of such
filing fee.
(d)
(e) The Company and each of its subsidiaries have been duly organized and are
validly existing as corporations in good standing under the laws of their
respective jurisdictions of incorporation and are duly qualified to
transact business as foreign corporations and are in good standing under
the laws of all other jurisdictions where the ownership or leasing of their
respective properties or the conduct of their respective businesses
requires such qualification, except where the failure to be so qualified
could result in a material adverse change in the condition (financial or
otherwise), business prospects, net worth or results of operations of the
Company and its subsidiaries, taken as a whole ("Material Adverse Change").
(f)
(g) The Merger Agreement, dated as of ____ between the Company, a Delaware
corporation, and bamboo Canada Inc. ("bamboo Canada"), a Canadian
corporation (the "Merger Agreement"), which effected the reincorporation of
the Company under the laws of the State of Delaware, is effective and has
caused the merger of Jutvision Corporation, the predecessor company to the
Company, with and into bamboo Canada. The Merger Agreement has been duly
authorized, executed and delivered by each of the Company and bamboo Canada
and is a valid and binding agreement of the Company and bamboo Canada,
enforceable against each in accordance with its terms and conforms to the
description thereof in the Prospectus.
(h)
(i) The Conversion and Pairing Agreement, entered into between the Company and
bamboo Canada (the "Conversion and Pairing Agreement"), has been duly
authorized, executed and delivered by each of the Company and bamboo Canada
and is a valid and binding agreement of the Company and bamboo Canada,
enforceable against each in accordance with its terms and conforms to the
description thereof in the Prospectus.
(j)
(k) The Company and each of its subsidiaries have all requisite corporate power
and corporate authority to execute and deliver the Merger Agreement and to
consummate the transactions contemplated thereby.
(l)
(m) All consents, approvals and authorizations of and filings with any
governmental entity with respect to any applicable laws required on the
part of the Company or any of its subsidiaries in connection with the valid
execution and delivery
4
of the Merger Agreement, or the consummation of the transaction
contemplated thereby, have been obtained or made.
(n)
(o) Neither the performance, execution and delivery of the Merger Agreement by
the Company or any of its subsidiaries, nor the consummation by the Company
and its subsidiaries of the transactions contemplated thereby, nor
compliance by the Company and its subsidiaries with any of the provisions
thereof, will result in any of the following: (a) a violation of the
restated certificate of incorporation or bylaws of the Company or its
subsidiaries, (b) a default or event that, with the notice or lapse of
time, or both would constitute a default, breach or violation of any
material contracts of the Company, (c) an event that would permit any
person or entity to terminate any material contract of the Company or to
accelerate the maturity of any obligation of the Company or its
subsidiaries, (d) a violation or breach of any applicable laws, or (e) a
violation of any judicial order to which the Company or any of its
subsidiaries are a party.
(p)
(q) The Class B common stock conforms to the description thereof in all
material respects under the heading "Description of Capital Stock - Class B
Common Stock."
(r)
(s) The Company and each of its subsidiaries have full power (corporate and
other) to own or lease their respective properties and conduct their
respective businesses as described in the Registration Statement and the
Prospectus or, if the Prospectus is not in existence, the most recent
Preliminary Prospectus; and the Company has full power (corporate and
other) to enter into this Agreement and to carry out all the terms and
provisions hereof to be carried out by it.
(t)
(u) The issued shares of capital stock of each of the Company's subsidiaries
have been duly authorized and are validly issued, fully paid and
nonassessable and, are owned beneficially and of record, by the Company
free and clear of any security interests, liens, encumbrances, equities or
claims, except for ___ shares of Series C preferred stock of bamboo Canada,
which convert at the option of the holder thereof into ___ shares of Common
Stock of the Company.
(v)
(w) The authorized, issued and outstanding capital stock of the Company is as
set forth in the Prospectus under the caption "Capitalization," and, after
giving effect to the offering will be set forth under the column "Pro Forma
As Adjusted" under the caption "Capitalization" (except for subsequent
issuances, if any pursuant to this Agreement, pursuant to reservations,
agreements or employee benefit plans referred to in the Prospectus or
pursuant to the exercise of options referred to in the Prospectus). All of
the issued shares of capital stock of the Company and its subsidiaries have
been duly authorized and validly issued and are fully paid and
nonassessable; none of the outstanding shares of capital stock of the
Company or its subsidiaries was issued in violation of the preemptive or
other similar rights of any security holder of the Company. The shares of
issued and outstanding capital stock of the Company and its subsidiaries
have been issued in compliance, with all federal and state securities laws,
and Canadian laws; and no preemptive rights of, or rights of refusal in
favor of, stockholders exist with respect to the Common Stock, or the issue
and sale thereof,
5
pursuant to the restated certificate of incorporation or bylaws of the
Company, and there are no contractual or statutory preemptive rights that
have not been waived, rights of first refusal or rights of co-sale which
exist with respect to the issue and sale of the Common Stock; except as
described in the Prospectus, there are no outstanding options, warrants
or other rights to purchase, agreements to issue or other rights to
convert any obligations into shares of capital stock of the Company or
any of its subsidiaries.
(x)
(y) The Firm Securities and the Option Securities have been duly authorized and
at the Firm Closing Date or the related Option Closing Date (as the case
may be), after payment therefor in accordance herewith, will be validly
issued, fully paid and nonassessable. No holders of outstanding shares of
capital stock of the Company are entitled as such to any preemptive or
other rights to subscribe for any of the Securities, and no holder of
securities of the Company has any right which has not been fully exercised
or waived to require the Company to register the offer or sale of any
securities owned by such holder under the Act in the public offering
contemplated by this agreement.
(z)
(aa) The capital stock of the Company and its subsidiaries conforms to the
description thereof contained in the Prospectus or, if the Prospectus is
not in existence, the most recent Preliminary Prospectus.
(bb)
(cc) Except as disclosed in the Prospectus (or, if the Prospectus is not in
existence, the most recent Preliminary Prospectus), there are no
outstanding (A) securities or obligations of the Company or any of its
subsidiaries convertible into or exchangeable for any capital stock of the
Company or any such subsidiary, (B) warrants, rights or options to
subscribe for or purchase from the Company or any such subsidiary any such
capital stock or any such convertible or exchangeable securities or
obligations, or (C) obligations of the Company or any such subsidiary to
issue any shares of capital stock, any such convertible or exchangeable
securities or obligations, or any such warrants, rights or options.
(dd)
(ee) The consolidated financial statements and schedules of the Company and its
consolidated subsidiaries included in the Registration Statement and the
Prospectus (or, if the Prospectus is not in existence, the most recent
Preliminary Prospectus) fairly present the financial position of the
Company and its consolidated subsidiaries and the results of operations and
changes in financial condition as of the dates and periods therein
specified. Such financial statements and schedules have been prepared in
accordance with generally accepted accounting principles consistently
applied throughout the periods involved. The financial data set forth
under the caption "Summary Consolidated Financial Data," "Capitalization"
and "Selected Consolidated Financial Data" in the Prospectus (or, if the
Prospectus is not in existence, the most recent Preliminary Prospectus)
fairly present, on the basis
6
stated in the Prospectus (or such Preliminary Prospectus), the
information included therein.
(ff)
(gg) PricewaterhouseCoopers LLP, who have certified certain financial statements
of the Company and its consolidated subsidiaries and delivered their report
with respect to the audited consolidated financial statements and schedules
included in the Registration Statement and the Prospectus (or, if the
Prospectus is not in existence, the most recent Preliminary Prospectus),
are independent public accountants as required by the Act and the
applicable rules and regulations thereunder.
(hh)
(ii) The execution and delivery of this Agreement have been duly authorized by
the Company and this Agreement has been duly executed and delivered by the
Company, and is the valid and binding agreement of the Company, enforceable
against the Company in accordance with its terms.
(jj)
(kk) No legal or governmental proceedings are pending to which the Company or
any of its subsidiaries is a party or to which the property of the Company
or any of its subsidiaries is subject that are required to be described in
the Registration Statement or the Prospectus and are not described therein
(or, if the Prospectus is not in existence, the most recent Preliminary
Prospectus), and no such proceedings have been threatened against the
Company or any of its subsidiaries or with respect to any of their
respective assets, technologies or properties; and no contract or other
document is required to be described in the Registration Statement or the
Prospectus or to be filed as an exhibit to the Registration Statement that
is not described therein (or, if the Prospectus is not in existence, the
most recent Preliminary Prospectus) or filed as required.
(ll)
(mm) The issuance, offering and sale of the Securities to the Underwriters by
the Company pursuant to this Agreement, the compliance by the Company with
the other provisions of this Agreement and the consummation of the other
transactions herein contemplated do not (i) require the consent, approval,
authorization, registration or qualification of or with any governmental
authority, except such as have been obtained, such as may be required under
state securities or blue sky laws and, if the registration statement filed
with respect to the Securities (as amended) is not effective under the Act
as of the time of execution hereof, such as may be required (and shall be
obtained as provided in this Agreement) under the Act, or (ii) conflict
with or result in a breach or violation of any of the terms and provisions
of, or constitute a default under, any indenture, mortgage, deed of trust,
lease or other agreement or instrument to which the Company or any of its
subsidiaries is a party or by which the Company or any of its subsidiaries
or any of their respective properties are bound, or the charter documents
or by-laws of the Company or any of its subsidiaries, or any statute or any
judgment, decree, order,
7
rule or regulation of any court or other governmental authority or any
arbitrator applicable to the Company or any of its subsidiaries.
(nn)
(oo) Subsequent to the respective dates as of which information is given in the
Registration Statement and the Prospectus or, if the Prospectus is not in
existence, the most recent Preliminary Prospectus, neither the Company nor
any of its subsidiaries has sustained any material loss or interference
with their respective businesses or properties from fire, flood, hurricane,
accident or other calamity, whether or not covered by insurance, or from
any labor dispute or any legal or governmental proceeding and there has not
been any Material Adverse Change, or any development involving a
prospective Material Adverse Change.
(pp)
(qq) The Company has not, directly or indirectly, (i) taken any action designed
to cause or to result in, or that has constituted or which might reasonably
be expected to constitute, the stabilization or manipulation of the price
of any security of the Company to facilitate the sale or resale of the
Securities or (ii) since the filing of the Registration Statement (A) sold,
bid for, purchased, or paid anyone any compensation for soliciting
purchases of, the Securities or (B) paid or agreed to pay to any person any
compensation for soliciting another to purchase any other securities of the
Company.
(rr)
(ss) The Company has not distributed and, prior to the later of (i) the Closing
Date and (ii) the completion of the distribution of the Securities, will
not distribute any offering material in connection with the offering and
sale of the Securities other than the Registration Statement or any
amendment thereto, any Preliminary Prospectus or the Prospectus or any
amendment or supplement thereto, or other materials, if any permitted by
the Act.
(a) Subsequent to the respective dates as of which information is given in the
Registration Statement and the Prospectus (or, if the Prospectus is not in
existence, the most recent Preliminary Prospectus), (1) the Company and its
subsidiaries have not incurred any material liability or obligation, direct
or contingent, nor entered into any material transaction not in the
ordinary course of business; (2) the Company has not purchased any of its
outstanding capital stock, nor declared, paid or otherwise made any
dividend or distribution of any kind on its capital stock; (3) the Company
has not purchased any of the outstanding capital stock of its subsidiaries,
nor declared, paid or otherwise made any dividend or distribution of any
kind on such capital stock and (4) there has not been any material change
in the capital stock, short-term debt or long-term debt of the Company and
its consolidated subsidiaries, except in each case as described in the
Prospectus (or, if the Prospectus is not in existence, the most recent
Preliminary Prospectus).
(b)
8
(c) The Company and each of its subsidiaries have good and marketable title in
fee simple to all items of real property and marketable title to all
personal property owned by each of them, in each case free and clear of any
security interests, liens, encumbrances, equities, claims and other
defects, except such as do not materially and adversely affect the value of
such property and do not interfere with the use made or proposed to be made
of such property by the Company or such subsidiary, and any real property
and buildings held under lease by the Company or any such subsidiary are
held under valid, subsisting and enforceable leases, with such exceptions
as are not material and do not interfere with the use made or proposed to
be made of such property and buildings by the Company or such subsidiary,
in each case except as described in the Prospectus (or, if the Prospectus
is not in existence, the most recent Preliminary Prospectus).
(d)
(e) Except as described in the Prospectus, no labor dispute with the employees
of the Company or any of its subsidiaries exists or is threatened or
imminent that could result in a Material Adverse Change.
(f)
(g) The Company and its subsidiaries own or possess, all material patents,
patent applications, trademarks, service marks, trade names, licenses,
copyrights and proprietary or other confidential information currently
employed by them in connection with their respective businesses, and
neither the Company nor any such subsidiary has received any notice of
infringement of or conflict with asserted rights of any third party with
respect to any of the foregoing which, singly or in the aggregate, if the
subject of an unfavorable decision, ruling or finding, would result in a
Material Adverse Change.
(h)
(i) The Company and each of its subsidiaries are insured by insurers of
recognized financial responsibility against such losses and risks and in
such amounts as are prudent and customary in the businesses in which they
are engaged; neither the Company nor any such subsidiary has been refused
any insurance coverage sought or applied for; and neither the Company nor
any such subsidiary has any reason to believe that it will not be able to
renew its existing insurance coverage as and when such coverage expires or
to obtain similar coverage from similar insurers as may be necessary to
continue its business at a cost that would not cause a Material Adverse
Change. The officers and directors of the Company are insured by insurers
of recognized financial responsibility against such losses and risks and in
such amounts as are prudent and customary for officers and directors
liability insurance of a public company and as would cover claims which
could be made in connection with the issuance of the Securities; and the
Company has no reason to believe that it will not be able to renew its
existing directors and officers liability insurance coverage as and when
such coverage expires or to obtain similar coverage from similar insurers
as may be necessary to cover its officers and directors.
(j)
9
(k) No subsidiary of the Company is currently prohibited, directly or
indirectly, from paying any dividends to the Company, from making any other
distribution on such subsidiary's capital stock, from repaying to the
Company any loans or advances to such subsidiary from the Company or from
transferring any of such subsidiary's property or assets to the Company or
any other subsidiary of the Company, except as described in the Prospectus
(or, if the Prospectus is not in existence, the most recent Preliminary
Prospectus).
(l)
(m) The Company and its subsidiaries possess all certificates, authorizations
and permits issued by the appropriate federal, state or foreign regulatory
authorities necessary to conduct their respective businesses, and neither
the Company nor any such subsidiary has received any notice of proceedings
relating to the revocation or modification of any such certificate,
authorization or permit which, singly or in the aggregate, if the subject
of an unfavorable decision, ruling or finding, would result in a Material
Adverse Change.
(n)
(o) The Company will conduct its operations in a manner that will not subject
it to registration as an investment company under the Investment Company
Act of 1940, as amended, and this transaction will not cause the Company to
become an investment company subject to registration under such Act.
(p)
(q) The Company has filed all foreign, federal, state and local tax returns
that are required to be filed or has requested extensions thereof (except
in any case in which the failure so to file would not have a material
adverse effect on the Company and its subsidiaries) and has paid all taxes
required to be paid by it and any other assessment, fine or penalty levied
against it, to the extent that any of the foregoing is due and payable,
except for any such assessment, fine or penalty that is currently being
contested in good faith or as described in the Prospectus (or, if the
Prospectus is not in existence, the most recent Preliminary Prospectus).
(r)
(s) Neither the Company nor any of its subsidiaries is in violation of any
federal or state law or regulation relating to occupational safety and
health or to the storage, handling or transportation of hazardous or toxic
materials and the Company and its subsidiaries have received all permits,
licenses or other approvals required of them under applicable federal and
state occupational safety and health and environmental laws and regulations
to conduct their respective businesses, and the Company and each such
subsidiary is in compliance with all terms and conditions of any such
permit, license or approval, except any such violation of law or
regulation, failure to receive required permits, licenses or other
approvals or failure to comply with the terms and conditions of such
permits, licenses or approvals which would not, singly or in the aggregate,
result in a Material Adverse Change.
(t)
10
(u) The statistical and market-related data included in the Registration
Statement and the Prospectus are derived from sources which the Company
reasonably and in good faith believes to be accurate, reasonable and
reliable; such data agrees in all material respects with the sources from
which they were derived, and to the Company's knowledge, such data
reasonably describes the markets or industries in which the Company
conducts or proposes to conduct its business.
(v)
(w) Except for the shares of capital stock of each of the subsidiaries owned by
the Company and such subsidiaries, neither the Company nor any such
subsidiary owns any shares of stock or any other equity securities of any
corporation or has any equity interest in any firm, partnership,
association or other entity, except as described in the Prospectus (or, if
the Prospectus is not in existence, the most recent Preliminary
Prospectus).
(x)
(y) The Shares have been duly authorized for listing on the Nasdaq National
Market, subject to official notice of issuance.
(z)
(aa) There are no holders of securities of the Company, who, by reason of the
filing of the Registration Statement, have the right (and have not waived
such right) to request the Company to register under the Act, or to include
in the Registration Statement, securities held by them.
(bb)
(cc) The Company and each of its subsidiaries maintain a system of internal
accounting controls sufficient to provide reasonable assurance that (1)
transactions are executed in accordance with management's general or
specific authorizations; (2) transactions are recorded as necessary to
permit preparation of financial statements in conformity with generally
accepted accounting principles and to maintain asset accountability; (3)
access to assets is permitted only in accordance with management's general
or specific authorization; and (4) the recorded accountability for assets
is compared with the existing assets at reasonable intervals and
appropriate action is taken with respect to any differences.
(dd)
(ee) No default exists, and no event has occurred which, with notice or lapse of
time or both, would constitute a default in the due performance and
observance of any term, covenant or condition of any indenture, mortgage,
deed of trust, lease or other agreement or instrument to which the Company
or any of its subsidiaries is a party or by which the Company or any of its
subsidiaries or any of their respective properties is bound or may be
affected in any material adverse respect with regard to property, business
or operations of the Company and its subsidiaries.
(ff)
(gg) Except as disclosed in the Prospectus or except as not reasonably required
to be disclosed in the Prospectus, there are no outstanding loans,
advances,
11
or guarantees of indebtedness by the Company to or for the benefit of any
of the executive officers or directors of the Company or any of the
members of the families of any of them.
(hh)
(ii) The execution and delivery of the Amendment to Joint Services Agreement,
Warrant and Option Agreement, entered into between the Company, RealSelect,
Inc. and XxxxXxxxx.xxx, Inc. has been duly authorized by the Company, and
is a valid and binding agreement of each party, enforceable against each
party in accordance with its terms canceling and terminating the terms of
the Option Agreement previously entered into between the Company and
RealSelect, Inc.
(jj)
(kk) Each certificate signed by any officer of the Company and delivered to the
Representatives or counsel for the Underwriters shall be deemed to be a
representation and warranty by the Company to each Underwriter as to the
matters covered thereby.
(ll)
2. Representations and Warranties of the Selling Securityholders. Each
--------------------------------------------------------------
Selling Securityholder represents and warrants to, and agrees with, each of the
several Underwriters that:
3.
(a) Such Selling Securityholder has full power to enter into this Agreement and
to sell, assign, transfer and deliver to the Underwriters the Securities to
be sold by such Selling Securityholder hereunder in accordance with the
terms of this Agreement; and this Agreement has been duly executed and
delivered by such Selling Securityholder.
(b)
(c) Such Selling Securityholder has duly executed and delivered a power of
attorney and custody agreement (with respect to such Selling
Securityholder, the "Power-of-Attorney" and the "Custody Agreement",
respectively), each in the form heretofore delivered to the
Representatives, appointing Xxxxx X. XxXxxxx as such Selling
Securityholder's attorney-in-fact (the "Attorney-in-Fact") with authority
to execute, deliver and perform this Agreement on behalf of such Selling
Securityholder and appointing Xxxxx X. XxXxxxx, as custodian thereunder
(the "Custodian"). Certificates in negotiable form, endorsed in blank or
accompanied by blank stock powers duly executed, with signatures
appropriately guaranteed, representing the Securities to be sold by such
Selling Securityholder hereunder have been deposited with the Custodian
pursuant to the Custody Agreement for the purpose of delivery pursuant to
this Agreement. Such Selling Securityholder has full power to enter into
the Custody Agreement and the Power-of-Attorney and to perform its
obligations under the Custody Agreement. The Custody Agreement and the
Power-of-Attorney have been duly executed and delivered by such Selling
Securityholder and, assuming due authorization, execution and delivery by
the Custodian, are the legal, valid, binding and enforceable instruments of
such Selling
12
Securityholder. Such Selling Securityholder agrees that each
of the Securities represented by the certificates on deposit with the
Custodian is subject to the interests of the Underwriters hereunder, that
the arrangements made for such custody, the appointment of the Attorney-in-
Fact and the right, power and authority of the Attorney-in-Fact to execute
and deliver this Agreement, to agree on the price at which the Securities
(including such Selling Securityholder's Securities) are to be sold to the
Underwriters, and to carry out the terms of this Agreement, are to that
extent irrevocable and that the obligations of such Selling Securityholder
hereunder shall not be terminated, except as provided in this Agreement or
the Custody Agreement, by any act of such Selling Securityholder, by
operation of law or otherwise, whether in the case of any individual
Selling Securityholder by the death or incapacity of such Selling
Securityholder, in the case of a trust or estate by the death of the
trustee or trustees or the executor or executors or the termination of such
trust or estate, or in the case of a corporate or partnership Selling
Securityholder by its liquidation or dissolution or by the occurrence of
any other event. If any individual Selling Securityholder, trustee or
executor should die or become incapacitated or any such trust should be
terminated, or if any corporate or partnership Selling Securityholder shall
liquidate or dissolve, or if any other event should occur, before the
delivery of such Securities hereunder, the certificates for such Securities
deposited with the Custodian shall be delivered by the Custodian in
accordance with the respective terms and conditions of this Agreement as if
such death, incapacity, termination, liquidation or dissolution or other
event had not occurred, regardless of whether or not the Custodian or the
Attorney-in-Fact shall have received notice thereof.
(d)
(e) Such Selling Securityholder is the lawful owner of the Securities to be
sold by such Selling Securityholder hereunder and upon sale and delivery
of, and payment for, such Securities, as provided herein, such Selling
Securityholder will convey good and marketable title to such Securities,
free and clear of any security interests, liens, encumbrances, equities,
claims or other defects.
(f)
(g) Such Selling Securityholder has not, directly or indirectly, (i) taken any
action designed to cause or result in, or that has constituted or which
might reasonably be expected to constitute, the stabilization or
manipulation of the price of any security of the Company to facilitate the
sale or resale of the Securities or (ii) since the filing of the
Registration Statement (A) sold, bid for, purchased, or paid anyone any
compensation for soliciting purchases of, the Securities or (B) paid or
agreed to pay to any person any compensation for soliciting another to
purchase any other securities of the Company (except for the sale of
Securities by the Selling Securityholders under this Agreement).
(h)
(i) To the extent that any statements or omissions are made in the Registration
Statement, any Preliminary Prospectus, the Prospectus or any
13
amendment or supplement thereto in reliance upon and in conformity with
written information furnished to the Company by such Selling
Securityholder specifically for use therein, such Preliminary Prospectus
did, and the Registration Statement and the Prospectus and any amendments
or supplements thereto, when they become effective or are filed with the
Commission, as the case may be, will conform in all material respects to
the requirements of the Act and the respective rules and regulations of
the Commission thereunder and will not contain any untrue statement of a
material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein, in the light of the
circumstances under which they are made, not misleading. Such Selling
Securityholder has reviewed the Prospectus (or, if the Prospectus is not
in existence, the most recent Preliminary Prospectus) and the
Registration Statement, and the information regarding such Selling
Securityholder set forth therein under the caption "Principal and Selling
Securityholders" is complete and accurate.
(j)
(k) The sale by such Selling Securityholder of Securities pursuant hereto is
not prompted by any adverse information concerning the Company that is not
set forth in the Registration Statement or the Prospectus (or, if the
Prospectus is not in existence, the most recent Preliminary Prospectus).
(l)
(m) The sale of the Securities to the Underwriters by such Selling
Securityholder pursuant to this Agreement, the compliance by such Selling
Securityholder with the other provisions of this Agreement, the Custody
Agreement and the consummation of the other transactions herein
contemplated do not (i) require the consent, approval, authorization,
registration or qualification of or with any governmental authority, except
such as have been obtained, such as may be required under state securities
or blue sky laws and, if the registration statement filed with respect to
the Securities (as amended) is not effective under the Act as of the time
of execution hereof, such as may be required (and shall be obtained as
provided in this Agreement) under the Act, or (ii) conflict with or result
in a breach or violation of any of the terms and provisions of, or
constitute a default under any indenture, mortgage, deed of trust, lease or
other agreement or instrument to which such Selling Securityholder is a
party or by which such Selling Securityholder or any of such Selling
Securityholder's properties are bound, or any statute or any judgment,
decree, order, rule or regulation of any court or other governmental
authority or any arbitrator applicable to such Selling Securityholder.
(n)
(o) Such Selling Securityholder will deliver to the Representatives no later
than the third business day prior to the Option Closing Date a properly
completed and executed U.S. Treasury Department Form W-9 (or Form W-8 for
non-U.S. residents).
(p)
14
4. Purchase, Sale and Delivery of the Securities.
---------------------------------------------
5.
(a) On the basis of the representations, warranties, agreements and covenants
herein contained and subject to the terms and conditions herein set forth,
the Company agrees to issue and sell to each of the Underwriters, and each
of the Underwriters, severally and not jointly, agrees to purchase from the
Company, at a purchase price of $_____ per share, the number of Firm
Securities set forth opposite the name of such Underwriter in Schedule 1
hereto. One or more certificates in definitive form for the Firm Securities
that the several Underwriters have agreed to purchase hereunder, and in
such denomination or denominations and registered in such name or names as
the Representatives request upon notice to the Company at least 48 hours
prior to the Firm Closing Date, shall be delivered by or on behalf of the
Company to the Representatives for the respective accounts of the
Underwriters, against payment by or on behalf of the Underwriters of the
purchase price therefor by wire transfer in same-day funds (the "Wired
Funds") to the account of the Company. Such delivery of and payment for
the Firm Securities shall be made at the offices of Skadden, Arps, Slate,
Xxxxxxx & Xxxx XXX, Xxxx Xxxx, Xxxxxxxxxx 00000, at 9:30 A.M., New York
time, on __________, 1999, or at such other place, time or date as the
Representatives and the Company may agree upon or as the Representatives
may determine pursuant to Section 11 hereof, such time and date of delivery
against payment being herein referred to as the "Firm Closing Date". The
Company will make such certificate or certificates for the Firm Securities
available for checking and packaging by the Representatives at the offices
in New York, New York of the Company's transfer agent or registrar or of
Prudential Securities Incorporated at least 24 hours prior to the Firm
Closing Date.
(b)
(c) For the purpose of covering any over-allotments in connection with the
distribution and sale of the Firm Securities as contemplated by the
Prospectus, the Company and the Selling Securityholders hereby grant to the
several Underwriters an option to purchase, severally and not jointly, the
Option Securities. The purchase price to be paid for any Option Securities
shall be the same price per share as the price per share for the Firm
Securities set forth above in paragraph (a) of this Section 4. The option
granted hereby may be exercised as to all or any part of the Option
Securities from time to time within (thirty) days after the date of the
Prospectus (or, if such 30th day shall be a Saturday or Sunday or a
holiday, on the next business day thereafter when the New York Stock
Exchange is open for trading). The Underwriters shall not be under any
obligation to purchase any of the Option Securities prior to the exercise
of such option. The Representatives may from time to time exercise the
option granted hereby by giving notice in writing or by telephone
(confirmed in writing) to the Company and the Selling Securityholders
setting forth the aggregate number of Option Securities as to which the
several Underwriters are then exercising the option and the date and time
for delivery of and payment for such Option Securities. Any such date of
delivery shall be determined
15
by the Representatives but shall not be earlier than two business days or
later than five business days after such exercise of the option and, in
any event, shall not be earlier than the Firm Closing Date. The time and
date set forth in such notice, or such other time on such other date as
the Representatives and Company may agree upon or as the Representatives
may determine pursuant to Section 11 hereof, is herein called the "Option
Closing Date" with respect to such Option Securities. The obligation of
each Underwriter to the Company and each of the Selling Securityholders
shall be to purchase from the Company and the Selling Securityholders
that number of shares of the Option Securities which represents the same
proportion of the total number of shares of the Option Securities to be
sold by each of the Company and the Selling Securityholders pursuant to
this Agreement as the number of shares of the Option Securities set forth
opposite the name of such Underwriter in Schedule I hereto represents of
the total number of shares of Option Securities to be purchased by all
Underwriters pursuant to this Agreement, as adjusted by you in such
manner as you deem advisable to avoid fractional shares. In entering into
this Agreement, each Underwriter is contracting severally and not
jointly; except as provided in Section 11, the agreement of each
Underwriter is to purchase only the respective number of shares of the
Option Securities as specified in Schedule 1. If the option is exercised
as to all or any portion of the Option Securities, one or more
certificates in definitive form for such Option Securities, and payment
therefor, shall be delivered on the related Option Closing Date in the
manner, and upon the terms and conditions, set forth in paragraph (a) of
this Section 4, except that reference therein to the Firm Securities and
the Firm Closing Date shall be deemed, for purposes of this paragraph
(b), to refer to such Option Securities and Option Closing Date,
respectively.
(d)
(e) Each of the Company and the Selling Securityholders hereby acknowledges
that the wire transfer by or on behalf of the Underwriters of the purchase
price for any Shares does not constitute closing of a purchase and sale of
the Shares. Only execution and delivery of a receipt for Shares by the
Underwriters indicates completion of the closing of a purchase of the
Shares from the Company and the Selling Securityholders . Furthermore, in
the event that the Underwriters wire funds to the Company or the Selling
Securityholders prior to the completion of the closing of a purchase of
Shares, each of the Company and the Selling Securityholders hereby
acknowledges that until the Underwriters execute and deliver a receipt for
the Shares, by facsimile or otherwise, the Company or the Selling
Securityholder, as the case may be, will not be entitled to the Wired Funds
and shall return the Wired Funds to the Underwriters as soon as practicable
(by wire transfer of same-day funds) upon demand. In the event that the
closing of a purchase of Shares is not completed and the Wired Funds are
not returned by the Company or the Selling Securityholders to the
Underwriters on the same day the Wired Funds were received by such party,
such party agrees to pay to the Underwriters in respect of each day the
Wired Funds are not returned by it, in same-day funds, interest on the
16
amount of such Wired Funds in an amount representing the Underwriters' cost
of financing as reasonably determined by Prudential Securities
Incorporated.
(f)
(g) It is understood that any of you, individually and not as one of the
Representatives, may (but shall not be obligated to) make payment on behalf
of any Underwriter or Underwriters for any of the Securities to be
purchased by such Underwriter or Underwriters. No such payment shall
relieve such Underwriter or Underwriters from any of its or their
obligations hereunder.
(h)
6. Offering by the Underwriters. Upon your authorization of the
-----------------------------
release of the Firm Securities, the several Underwriters propose to offer the
Firm Securities for sale to the public upon the terms set forth in the
Prospectus.
7.
8. Covenants of the Company. The Company covenants and agrees with each
-------------------------
of the Underwriters that:
9.
(a) The Company will use its best efforts to cause the Registration Statement,
if not effective at the time of execution of this Agreement, and any
amendments thereto to become effective as promptly as possible. If
required, the Company will file the Prospectus or any Term Sheet that
constitutes a part thereof and any amendment or supplement thereto with the
Commission in the manner and within the time period required by Rules 434
and 424(b) under the Act. During any time when a prospectus relating to
the Securities is required to be delivered under the Act, the Company (i)
will comply with all requirements imposed upon it by the Act and the rules
and regulations of the Commission thereunder to the extent necessary to
permit the continuance of sales of or dealings in the Securities in
accordance with the provisions hereof and of the Prospectus, as then
amended or supplemented, and (ii) will not file with the Commission the
prospectus, Term Sheet or the amendment referred to in the second sentence
of Section 2(a) hereof, any amendment or supplement to such Prospectus,
Term Sheet or any amendment to the Registration Statement or any Rule
462(b) Registration Statement of which the Representatives previously have
been advised and furnished with a copy for a reasonable period of time
prior to the proposed filing and as to which filing the Representatives
shall not have given their consent. The Company will prepare and file with
the Commission, in accordance with the rules and regulations of the
Commission, promptly upon request by the Representatives or counsel for the
Underwriters, any amendments to the Registration Statement or amendments or
supplements to the Prospectus that may be necessary or advisable in
connection with the distribution of the Securities by the several
Underwriters, and will use its best efforts to cause any such amendment to
the Registration Statement to be declared effective by the Commission as
promptly as possible. The Company will advise the Representatives,
promptly after receiving notice thereof, of the time when the Registration
Statement or any amendment thereto has been filed or declared effective or
the Prospectus or any amendment or
17
supplement thereto has been filed and will provide evidence satisfactory
to the Representatives of each such filing or effectiveness.
(b)
(c) The Company will advise the Representatives, promptly after receiving
notice or obtaining knowledge thereof, of (i) the issuance by the
Commission of any stop order suspending the effectiveness of the Original
Registration Statement or any Rule 462(b) Registration Statement or any
amendment thereto or any order preventing or suspending the use of any
Preliminary Prospectus or the Prospectus or any amendment or supplement
thereto, (ii) the suspension of the qualification of the Securities for
offering or sale in any jurisdiction, (iii) the institution, threatening or
contemplation of any proceeding for any such purpose or (iv) any request
made by the Commission for amending the Original Registration Statement or
any Rule 462(b) Registration Statement, for amending or supplementing the
Prospectus or for additional information. The Company will use its best
efforts to prevent the issuance of any such stop order and, if any such
stop order is issued, to obtain the withdrawal thereof as promptly as
possible.
(d)
(e) The Company will arrange for the qualification of the Securities for
offering and sale under the securities or blue sky laws of such
jurisdictions as the Representatives may designate and will continue such
qualifications in effect for as long as may be necessary to complete the
distribution of the Securities, provided, however, that in connection
-----------------
therewith the Company shall not be required to qualify as a foreign
corporation or to execute a general consent to service of process in any
jurisdiction.
(f)
(g) If, at any time prior to the later of (i) the final date when a prospectus
relating to the Securities is required to be delivered under the Act or
(ii) the Option Closing Date, any event occurs as a result of which the
Prospectus, as then amended or supplemented, would include any untrue
statement of a material fact or omit to state a material fact necessary in
order to make the statements therein, in the light of the circumstances
under which they were made, not misleading, or if for any other reason it
is necessary at any time to amend or supplement the Prospectus to comply
with the Act or the rules or regulations of the Commission thereunder, the
Company will promptly notify the Representatives thereof and, subject to
Section 6(a) hereof, will prepare and file with the Commission, at the
Company's expense, an amendment to the Registration Statement or an
amendment or supplement to the Prospectus that corrects such statement or
omission or effects such compliance.
(h)
(i) The Company will, without charge, provide (i) to the Representatives and to
counsel for the Underwriters a conformed copy of the registration statement
originally filed with respect to the Securities and each amendment thereto
(in each case including exhibits thereto) or any Rule 462(b) Registration
Statement, certified by the Secretary or an Assistant Secretary of the
Company to be true and complete
18
copies thereof as filed with the Commission by electronic transmission,
(ii) to each other Underwriter, a conformed copy of such registration
statement or any Rule 462(b) Registration Statement and each amendment
thereto (in each case without exhibits thereto) and (iii) so long as a
prospectus relating to the Securities is required to be delivered under
the Act, as many copies of each Preliminary Prospectus or the Prospectus
or any amendment or supplement thereto as the Representatives may
reasonably request; without limiting the application of clause (iii) of
this sentence, the Company, not later than (A) 6:00 P.M., New York City
time, on the date of determination of the public offering price, if such
determination occurred at or prior to 10:00 A.M., New York City time, on
such date or (B) 2:00 P.M., New York City time, on the business day
following the date of determination of the public offering price, if such
determination occurred after 10:00 A.M., New York City time, on such
date, will deliver to the Underwriters, without charge, as many copies of
the Prospectus and any amendment or supplement thereto as the
Representatives may reasonably request for purposes of confirming orders
that are expected to settle on the Firm Closing Date.
(j)
(k) The Company, as soon as practicable, will make generally available to its
securityholders and to the Representatives a consolidated earnings
statement of the Company and its subsidiaries that satisfies the provisions
of Section 11(a) of the Act and Rule 158 thereunder.
(l)
(m) The Company will apply the net proceeds from the sale of the Securities as
set forth under "Use of Proceeds" in the Prospectus.
(n)
(o) The Company will not, directly or indirectly, without the prior written
consent of Prudential Securities Incorporated, on behalf of the
Underwriters, offer, sell, offer to sell, contract to sell, pledge, grant
any option to purchase or otherwise sell or dispose (or announce any offer,
sale, offer of sale, contract of sale, pledge, grant of any option to
purchase or other sale or disposition) of any shares of Common Stock or any
securities convertible into, or exchangeable or exercisable for shares of
Common Stock for a period of 180 days from the date of the Prospectus,
except pursuant to this Agreement and except for issuances pursuant to the
existing employee benefit plans or stock option plans of the Company
outstanding on the date hereof or pursuant to the terms of convertible
securities of the Company or its subsidiaries outstanding on the date
hereof, in each case pursuant to the plans described in the Prospectus.
(p)
(q) The Company will not, directly or indirectly, (i) take any action designed
to cause or to result in, or that has constituted or which might reasonably
be expected to constitute, the stabilization or manipulation of the price
of any security of the Company to facilitate the sale or resale of the
Securities or (ii) (A) sell, bid for, purchase, or pay anyone any
compensation for soliciting purchases of, the Securities
19
or (B) pay or agree to pay to any person any compensation for soliciting
another to purchase any other securities of the Company.
(r)
(s) The Company will obtain the agreements described in 9(g) hereof prior to
the Firm Closing Date.
(t)
(u) If at any time during the 25-day period after the Registration Statement
becomes effective or the period prior to the Option Closing Date, any
rumor, publication or event relating to or affecting the Company shall
occur as a result of which in your opinion the market price of the Common
Stock has been or is likely to be materially affected (regardless of
whether such rumor, publication or event necessitates a supplement to or
amendment of the Prospectus), the Company will, after notice from you
advising the Company to the effect set forth above, forthwith prepare,
consult with you concerning the substance of, and disseminate a press
release or other public statement, reasonably satisfactory to you,
responding to or commenting on such rumor, publication or event.
(v)
(w) If the Company elects to rely on Rule 462(b), the Company shall both file a
Rule 462(b) Registration Statement with the Commission in compliance with
Rule 462(b) and pay the applicable fees in accordance with Rule 111
promulgated under the Act by the earlier of (i) 10:00 P.M. Eastern time on
the date of this Agreement and (ii) the time confirmations are sent or
given, as specified by Rule 462(b)(2).
(x)
(y) The Company will cause the Securities to be duly included for quotation on
The Nasdaq Stock Market's National Market (the "Nasdaq National Market")
prior to the Firm Closing Date. The Company will ensure that the
Securities remain included for quotation on the Nasdaq National Market
following the Firm Closing Date.
(z)
(aa) The Company will promptly redeem each share of Class B common stock prior
to and upon the effectiveness of the conversion of each share of Series C
preferred stock of bamboo Canada into shares of Common Stock of the Company
in accordance with the terms of the Conversion and Pairing Agreement and
their respective charters.
(bb)
10. Covenants of the Selling Securityholders. Each of the Selling
----------------------------------------
Securityholders covenants and agrees with each of the Underwriters that:
11.
(a) Each Selling Securityholder will not, directly or indirectly, without the
prior written consent of Prudential Securities Incorporated, offer, sell,
offer to sell, contract to sell, pledge, grant any option to purchase or
otherwise sell or dispose (or announce any offer, sale, offer of sale,
contract of sale, pledge, grant of any
20
option to purchase or other sale or disposition) of any Securities
legally or beneficially owned by such Selling Securityholder or any
securities convertible into, or exchangeable or exercisable for,
Securities for a period of 180 days after the date hereof.
(b)
(c) Such Selling Securityholder will not, directly or indirectly, (i) take any
action designed to cause or result in, or that has constituted or which
might reasonably be expected to constitute, the stabilization or
manipulation of the price of any security of the Company to facilitate the
sale or resale of the Securities or (ii) (A) sell, bid for, purchase, or
pay anyone any compensation for soliciting purchases of, the Securities or
(B) pay or agree to pay to any person any compensation for soliciting
another to purchase any other securities of the Company (except for the
sale of Securities by the Selling Securityholders under this Agreement).
(d)
12. Expenses. The Company will pay all costs and expenses incident to
--------
the performance of its obligations under this Agreement, whether or not the
transactions contemplated herein are consummated or this Agreement is terminated
pursuant to Section 13 hereof, including all costs and expenses incident to (i)
the printing or other production of documents with respect to the transactions,
including any costs of printing the registration statement originally filed with
respect to the Securities and any amendment thereto, any Rule 462(b)
Registration Statement, any Preliminary Prospectus and the Prospectus and any
amendment or supplement thereto, this Agreement and any blue sky memoranda, (ii)
all arrangements relating to the delivery to the Underwriters of copies of the
foregoing documents, (iii) the fees and disbursements of the counsel, the
accountants and any other experts or advisors retained by the Company, (iv)
preparation, issuance and delivery to the Underwriters of any certificates
evidencing the Securities, including transfer agent's and registrar's fees, (v)
the qualification of the Securities under state securities and blue sky laws,
including filing fees and fees and disbursements of counsel for the Underwriters
relating thereto, (vi) the filing fees of the Commission and the National
Association of Securities Dealers, Inc. relating to the Securities and the fees
of underwriter's counsel incurred in connection with the review of the Offering
by the NASD, (vii) any quotation of the Securities on the Nasdaq National
Market, (viii) any meetings with prospective investors in the Securities (other
than as shall have been specifically approved by the Representatives to be paid
for by the Underwriters) and (ix) advertising relating to the offering of the
Securities (other than as shall have been specifically approved by the
Representatives to be paid for by the Underwriters).
13.
14. If the sale of the Securities provided for herein is not
consummated because any condition to the obligations of the Underwriters set
forth in Section 9 hereof is not satisfied, because this Agreement is terminated
pursuant to Section 13 hereof or because of any failure, refusal or inability on
the part of the Company to
21
perform all obligations and satisfy all conditions on its part to be performed
or satisfied hereunder other than by reason of a default by any of the
Underwriters, the Company will reimburse the Underwriters severally upon
demand for all out-of-pocket expenses (including counsel fees and
disbursements) that shall have been incurred by them in connection with the
proposed purchase and sale of the Securities. The Company shall not in any
event be liable to any of the Underwriters for the loss of anticipated profits
from the transactions covered by this Agreement.
15.
16. Conditions of the Underwriters' Obligations. The obligations of the
-------------------------------------------
several Underwriters to purchase and pay for the Firm Securities shall be
subject, in the Representatives' sole discretion, to the accuracy of the
representations and warranties of the Company contained herein as of the date
hereof and as of the Firm Closing Date, as if made on and as of the Firm Closing
Date, to the accuracy of the statements of the Company's officers made pursuant
to the provisions hereof, to the performance by the Company of its covenants and
agreements hereunder and to the following additional conditions:
17.
(a) If the Original Registration Statement or any amendment thereto filed prior
to the Firm Closing Date has not been declared effective as of the time of
execution hereof, the Original Registration Statement or such amendment
and, if the Company has elected to rely upon Rule 462(b), the Rule 462(b)
Registration Statement shall have been declared effective not later than
the earlier of (i) 11:00 A.M., New York time, on the date on which the
amendment to the registration statement originally filed with respect to
the Securities or to the Registration Statement, as the case may be,
containing information regarding the initial public offering price of the
Securities has been filed with the Commission and (ii) the time
confirmations are sent or given as specified by Rule 462(b)(2), or with
respect to the Original Registration Statement, or such later time and date
as shall have been consented to in writing by the Representatives; if
required, the Prospectus or any Term Sheet that constitutes a part thereof
and any amendment or supplement thereto shall have been filed with the
Commission in the manner and within the time period required by Rules 434
and 424(b) under the Act; no stop order suspending the effectiveness of the
Registration Statement or any amendment thereto shall have been issued, and
no proceedings for that purpose shall have been instituted or threatened
or, to the knowledge of the Company or the Representatives, shall be
contemplated by the Commission; and the Company shall have complied with
any request of the Commission for additional information (to be included in
the Registration Statement or the Prospectus or otherwise).
(b)
(c) The Representatives shall have received an opinion, dated the Firm Closing
Date, of Wilson, Sonsini, Xxxxxxxx & Xxxxxx, a professional corporation,
counsel for the Company, to the effect that:
(d)
22
(i) the Company and each of its subsidiaries listed in Exhibit 22 to the
Registration Statement (the "Subsidiaries") have been duly organized and
are validly existing as corporations in good standing under the laws of
their respective jurisdictions of incorporation and are duly qualified to
transact business as foreign corporations and are in good standing under
the laws of all other jurisdictions where the ownership or leasing of their
respective properties or the conduct of their respective businesses
requires such qualification, except where the failure to be so qualified
would not have a Material Adverse Change.
(i) the Merger Agreement, dated as of ____ between the Company, a Delaware
corporation, and bamboo Canada Inc. ("bamboo Canada"), a Canadian
corporation (the "Merger Agreement"), which effected the reincorporation of
the Company under the laws of the State of Delaware, is effective and has
caused the merger of Jutvision Corporation, the predecessor company to the
Company, with and into bamboo Canada. The Merger Agreement has been duly
authorized, executed and delivered by each of the Company and bamboo Canada
and is a valid and binding agreement of the Company and bamboo Canada,
enforceable against each in accordance with its terms and conforms to the
description thereof in the Prospectus;
(i) the Conversion and Pairing Agreement, entered into between the Company and
bamboo Canada (the "Conversion and Pairing Agreement"), has been duly
authorized, executed and delivered by each of the Company and bamboo Canada
and is a valid and binding agreement of the Company and bamboo Canada,
enforceable against each in accordance with its terms and conforms to the
description thereof in the Prospectus;
(i) the Company has all requisite corporate power and corporate authority to
execute and deliver the Merger Agreement and to consummate the transactions
contemplated thereby;
(i) all consents, approvals and authorizations of and filings with any
governmental entity with respect to any applicable laws required on the
part of the Company or any of its subsidiaries in connection with the valid
execution and delivery of the Merger Agreement, or the consummation of the
transaction contemplated thereby, have been obtained or made;
23
(i) neither the performance, execution and delivery of the Merger Agreement by
the Company or any of its subsidiaries, nor the consummation by the Company
and its subsidiaries of the transactions contemplated thereby, nor
compliance by the Company and its subsidiaries with any of the provisions
thereof, will result in any of the following: (a) a violation of the
restated certificate of incorporation or bylaws of the Company or its
subsidiaries, (b) a default or event that, with the notice or lapse of
time, or both would constitute a default, breach or violation of any
material contracts, (c) an event that would permit any person or entity to
terminate any material contract or to accelerate the maturity of any
obligation of the Company or its subsidiaries, (d) a violation or breach of
any applicable laws, or (e) a violation of any judicial order to which the
Company or any of its subsidiaries are a party;
(i) the Class B common stock conforms to the description thereof in all
material respects under the heading "Description of Capital Stock - Class B
Common Stock;"
(i) the Company and each of its subsidiaries have full power (corporate and
other) to own or lease their respective properties and conduct their
respective businesses as described in the Registration Statement and the
Prospectus or, if the Prospectus is not in existence, the most recent
Preliminary Prospectus; and the Company has full power (corporate and
other) to enter into this Agreement and to consummate the transactions
contemplated thereby;
(i) the issued shares of capital stock of each of the Company's subsidiaries
have been duly authorized and validly issued, are fully paid and
nonassessable and, are owned beneficially and of record, by the Company
free and clear of any security interests, liens, encumbrances, equities or
claims, except for ___ shares of Series C preferred stock of bamboo Canada,
which convert at the option of the holder thereof into ___ shares of Common
Stock of the Company;
(i) the authorized, issued and outstanding capital stock of the Company is as
set forth in the Prospectus under the caption "Capitalization," and, after
giving effect to the offering will be set forth under the column "Pro Forma
As Adjusted" under the caption "Capitalization" (except for subsequent
issuances, if any pursuant to this Agreement, pursuant to reservations,
agreements or employee benefit plans referred to in the Prospectus or
pursuant to the exercise of options referred to in the Prospectus). All of
the issued
24
shares of capital stock of the Company and its subsidiaries have been
duly authorized and validly issued and are fully paid and nonassessable;
none of the outstanding shares of capital stock of the Company or its
subsidiaries was issued in violation of the preemptive or other similar
rights of any security holder of the Company. The shares of issued and
outstanding capital stock of the Company and its subsidiaries have been
issued in compliance, with all federal and state securities laws, and
Canadian laws; and no preemptive rights of, or rights of refusal in favor
of, stockholders exist with respect to the Common Stock, or the issue and
sale thereof, pursuant to the restated certificate of incorporation or
bylaws of the Company, and there are no contractual or statutory
preemptive rights that have not been waived, rights of first refusal or
rights of co-sale which exist with respect to the issue and sale of the
Common Stock; except as described in the Prospectus, there are no
outstanding options, warrants or other rights to purchase, agreements to
issue or other rights to convert any obligations into shares of capital
stock of the Company or any of its subsidiaries;
(i) the Firm Securities and the Option Securities have been duly authorized and
at the Firm Closing Date or the related Option Closing Date (as the case
may be), after payment therefor in accordance herewith, will be validly
issued, fully paid and nonassessable. No holders of outstanding shares of
capital stock of the Company are entitled as such to any preemptive or
other rights to subscribe for any of the Securities, and no holder of
securities of the Company has any right which has not been fully exercised
or waived to require the Company to register the offer or sale of any
securities owned by such holder under the Act in the public offering
contemplated by this agreement;
(i) the statements set forth (A) under the heading "Description of Capital
Stock," "Certain Transactions," and "Management" in the Prospectus and (B)
in the Registration Statement under Item 14, insofar as such statements
constitute matters of law, summaries of legal matters, the Company's
charters and by-laws or legal proceedings, or legal conclusions, have been
reviewed by us and is correct in all material respects;
(i) the execution and delivery of this Agreement have been duly authorized by
all necessary corporate action of the Company and this Agreement has been
duly executed and delivered by the Company;
25
(i) (A) no legal or governmental proceedings are pending to which the Company
or any of the Subsidiaries is a party or to which the property of the
Company or any of the Subsidiaries is subject that are required to be
described in the Registration Statement or the Prospectus and are not
described therein, and, to the best knowledge of such counsel, no such
proceedings have been threatened against the Company or any of the
subsidiaries or with respect to any of their respective properties and (B)
no contract or other document is required to be described in the
Registration Statement or the Prospectus or to be filed as an exhibit to
the Registration Statement that is not described therein or filed as
required;
(i) the issuance, offering and sale of the Securities to the Underwriters by
the Company pursuant to this Agreement, the compliance by the Company with
the other provisions of this Agreement and the consummation of the other
transactions herein contemplated do not (A) require the consent, approval,
authorization, registration or qualification of or with any governmental
authority, except such as have been obtained and such as may be required
under state securities or blue sky laws, or (B) conflict with or result in
a breach or violation of any of the terms and provisions of, or constitute
a default under, any indenture, mortgage, deed of trust, lease or other
agreement or instrument, known to such counsel, to which the Company or any
of the subsidiaries is a party or by which the Company or any of the
subsidiaries or any of their respective properties are bound, or the
charter documents or by-laws of the Company or any of the subsidiaries, or
any statute or any judgment, decree, order, rule or regulation of any court
or other governmental authority or any arbitrator known to such counsel and
applicable to the Company or subsidiaries;
(i) the Registration Statement is effective under the Act; any required filing
of the Prospectus, or any Term Sheet that constitutes a part thereof,
pursuant to Rules 434 and 424(b) has been made in the manner and within the
time period required by Rules 434 and 424(b); and no stop order suspending
the effectiveness of the Registration Statement or any amendment thereto
has been issued, and no proceedings for that purpose have been instituted
or threatened or, to the best knowledge of such counsel, are contemplated
by the Commission;
26
(i) the Registration Statement originally filed with respect to the Securities
and each amendment thereto, any Rule 462(b) Registration Statement and the
Prospectus (in each case, other than the financial statements and other
financial information contained therein, as to which such counsel need
express no opinion) comply as to form in all material respects with the
applicable requirements of the Act and the rules and regulations of the
Commission thereunder; and
(i) if the Company elects to rely on Rule 434, the Prospectus is not
"materially different", as such term is used in Rule 434, from the
prospectus included in the Registration Statement at the time of its
effectiveness or an effective post-effective amendment thereto (including
such information that is permitted to be omitted pursuant to Rule 430A).
Such counsel shall also state that they have no reason to believe that the
Registration Statement, as of its effective date and the date of such opinion,
contained any untrue statement of a material fact or omitted to state any
material fact required to be stated therein or necessary to make the statements
therein not misleading or that the Prospectus, as of its date or the date of
such opinion, included or includes any untrue statement of a material fact or
omitted or omits 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.
In rendering any such opinion, such counsel may rely, as to matters of
fact, to the extent such counsel deems proper, on certificates of responsible
officers of the Company and public officials and as to matters involving the
application of laws of any jurisdiction other than the State of Delaware or the
United States, to the extent satisfactory in form and scope to counsel for the
Underwriters upon the opinion of _____________, Canadian counsel. The foregoing
opinion shall also state that the Underwriters are justified in relying upon
such opinion of Canadian counsel, and copies of such opinion shall be delivered
to the Representatives and counsel for the Underwriters.
References to the Registration Statement and the Prospectus in this
paragraph (b) shall include any amendment or supplement thereto at the date of
such opinion.
(a) The Representatives shall have received an opinion, dated the Firm Closing
Date, of _________________, Canadian counsel for the Company, to the effect
that:
(b)
(i) [TO COME]
27
Such counsel shall also state that they have no reason to believe that the
Registration Statement, as of its effective date, contained any untrue statement
of a material fact or omitted to state any material fact required to be stated
therein or necessary to make the statements therein not misleading or that the
Prospectus, as of its date or the date of such opinion, included or includes any
untrue statement of a material fact or omitted or omits 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.
References to the Registration Statement and the Prospectus in this
paragraph (b) shall include any amendment or supplement thereto at the date of
such opinion.
(a) The Representatives shall have received an opinion, dated the Firm Closing
Date, of Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP, 000 Xxxxxxxxxx Xxxxxx,
Xxxxx 000, Xxxx Xxxx, XX 00000, counsel for the Underwriters, with respect
to the issuance and sale of the Firm Securities, the Registration Statement
and the Prospectus, and such other related matters as the Representatives
may reasonably require, and the Company shall have furnished to such
counsel such documents as they may reasonably request for the purpose of
enabling them to pass upon such matters. In rendering such opinion, such
counsel may rely as to all matters of law upon the opinion of Canadian
counsel referred to in paragraph (b) above.
(b)
(c) The Selling Securityholders shall have furnished to the Representatives the
opinion of Wilson, Sonsini, Xxxxxxxx and Xxxxxx, a professional
corporation, counsel for the Selling Securityholders, dated the Closing
Date, to the effect that:
(d)
(i) such Selling Securityholder has full power to enter into this Agreement,
the Custody Agreement and the Power-of-Attorney and to sell, transfer and
deliver the Securities being sold by such Selling Securityholder hereunder
in the manner provided in this Agreement and to perform its obligations
under the Custody Agreement; this Agreement, the Custody Agreement and the
Power-of-Attorney have been duly executed and delivered by each Selling
Securityholder; assuming due authorization, execution and delivery by the
Custodian, the Custody Agreement and the Power-of-Attorney are the legal,
valid, binding and enforceable instruments of such Selling Securityholder,
subject to applicable bankruptcy, insolvency and similar laws affecting
creditors' rights generally and subject, as to enforceability, to general
principles of equity (regardless of whether enforcement is sought in a
proceeding in equity or at law);
28
(i) the delivery by each Selling Securityholder to the several Underwriters of
certificates for the Securities being sold hereunder by such Selling
Securityholder against payment therefor as provided herein, will convey
good and marketable title to such Securities to the several Underwriters,
free and clear of all security interests, liens, encumbrances, equities,
claims or other defects;
(i) the sale of the Securities to the Underwriters by such Selling
Securityholder pursuant to this Agreement, the compliance by such Selling
Securityholder with the other provisions of this Agreement, the Custody
Agreement and the consummation of the other transactions herein
contemplated do not (i) require the consent, approval, authorization,
registration or qualification of or with any governmental authority, except
such as have been obtained and such as may be required under state
securities or blue sky laws, or (ii) conflict with or result in a breach or
violation of any of the terms and provisions of, or constitute a default
under any indenture, mortgage, deed of trust, lease or other agreement or
instrument to which such Selling Securityholder is a party or by which such
Selling Securityholder or any of such Selling Securityholder's properties
are bound, or any statute or any judgment, decree, order, rule or
regulation of any court or other governmental authority or any arbitrator
applicable to such Selling Securityholder.
In rendering such opinion, such counsel may rely, as to matters of fact, to
the extent such counsel deems proper, on certificates of responsible officers of
the Company and public officials and, as to matters involving the application of
laws of any jurisdiction other than the State of Delaware or the United States,
to the extent satisfactory in form and scope to counsel for the Underwriters,
upon the opinion of ________, Canadian counsel. The foregoing opinion shall also
state that the Underwriters are justified in relying upon such opinion of
Canadian counsel, and copies of such opinion shall be delivered to the
Representatives and counsel for the Underwriters.
References to the Registration Statement and the Prospectus in this
paragraph (e) shall include any amendment or supplement thereto at the date of
such opinion.
(a) The Representatives shall have received from PricewaterhouseCoopers LLP a
letter or letters dated, respectively, the date hereof and the Firm Closing
Date, in form and substance satisfactory to the Representatives, to the
effect that:
(b)
29
(i) they are independent accountants with respect to the Company and its
consolidated subsidiaries within the meaning of the Act and the applicable
rules and regulations thereunder;
(i) in their opinion, the audited consolidated financial statements and
schedules examined by them and included in the Registration Statement and
the Prospectus comply in form in all material respects with the applicable
accounting requirements of the Act and the related published rules and
regulations;
(i) on the basis of a reading of the latest available interim unaudited
consolidated financial statements of the Company and its consolidated
subsidiaries, carrying out certain specified procedures (which do not
constitute an examination made in accordance with generally accepted
auditing standards) that would not necessarily reveal matters of
significance with respect to the comments set forth in this paragraph
(iii), a reading of the minute books of the shareholders, the board of
directors and any committees thereof of the Company and each of its
consolidated subsidiaries, and inquiries of certain officials of the
Company and its consolidated subsidiaries who have responsibility for
financial and accounting matters, nothing came to their attention that
caused them to believe that:
(i) the unaudited consolidated financial statements of the Company and its
consolidated subsidiaries included in the Registration Statement and the
Prospectus do not comply in form in all material respects with the
applicable accounting requirements of the Act and the related published
rules and regulations thereunder or are not in conformity with generally
accepted accounting principles applied on a basis substantially consistent
with that of the audited consolidated financial statements included in the
Registration Statement and the Prospectus;
(i) at a specific date not more than five business days prior to the date of
such letter, there were any changes in the capital stock or long-term debt
of the Company and its consolidated subsidiaries or any decreases in net
current assets or stockholders' equity of the Company and its consolidated
subsidiaries, in each case compared with amounts shown on the March 31,
1999 unaudited consolidated balance sheet included in the Registration
Statement and the Prospectus, or for the period from April 1, 1999 to
________________________;
30
(i) they have carried out certain specified procedures, not constituting an
audit, with respect to certain amounts, percentages and financial
information that are derived from the general accounting records of the
Company and its consolidated subsidiaries and are included in the
Registration Statement and the Prospectus under the captions "Summary
Consolidated Financial Date," "Capitalization," "Selected Financial Data,"
and "Management's Discussion and Analysis of Financial Condition and
Results of Operations," and in Exhibit 11 to the Registration Statement,
and have compared such amounts, percentages and financial information with
such records of the Company and its consolidated subsidiaries and with
information derived from such records and have found them to be in
agreement, excluding any questions of legal interpretation; and
(i) they have performed the procedures specified by the American Institute of
Certified Public Accountants for a review of interim financial information
as described in Statement of Auditing Standards No. 71, Interim Financial
Information, on the unaudited financial statements included in the
Registration Statement.
In the event that the letters referred to above set forth any such changes,
decreases or increases, it shall be a further condition to the obligations of
the Underwriters that (A) such letters shall be accompanied by a written
explanation of the Company as to the significance thereof, unless the
Representatives deem such explanation unnecessary, and (B) such changes,
decreases or increases do not, in the sole judgment of the Representatives, make
it impractical or inadvisable to proceed with the purchase and delivery of the
Securities as contemplated by the Registration Statement, as amended as of the
date hereof.
References to the Registration Statement and the Prospectus in this
paragraph (d) with respect to either letter referred to above shall include any
amendment or supplement thereto at the date of such letter.
(a) The Representatives shall have received a certificate, dated the Firm
Closing Date, Xxxxxxx X. XxXxxxx and Xxxxxxx X. Xxxxxx of the Company to
the effect that:
(b)
(i) the representations and warranties of the Company in this Agreement are
true and correct as if made on and as of the Firm Closing Date; the
Registration Statement as of its date, as of the time of its effectiveness
and as of the Firm Closing Date, as
31
amended as of the Firm Closing Date, does not include any untrue
statement of a material fact or omit to state any material fact necessary
to make the statements therein not misleading, and the Prospectus as of
its date and as of the Firm Closing Date, as amended or supplemented as
of the Firm Closing Date, does not include any untrue statement of a
material fact or omit to state any material fact necessary in order to
make the statements therein, in the light of the circumstances under
which they were made, not misleading; and the Company has performed all
covenants and agreements and satisfied all conditions on its part to be
performed or satisfied at or prior to the Firm Closing Date;
(i) no stop order suspending the effectiveness of the Registration Statement or
any amendment thereto has been issued, and no proceedings for that purpose
have been instituted or threatened or, to the best of the Company's
knowledge, are contemplated by the Commission; and
(i) subsequent to the respective dates as of which information is given in the
Registration Statement and the Prospectus, neither the Company nor any of
its subsidiaries has sustained any material loss or interference with their
respective businesses or properties from fire, flood, hurricane, accident
or other calamity, whether or not covered by insurance, or from any labor
dispute or any legal or governmental proceeding, and there has not been any
material adverse change, or any development involving a prospective
Material Adverse Change.
(a) The Representatives shall have received a certificate from each Selling
Securityholder, signed by such Selling Securityholder, dated the Option
Closing Date, to the effect that:
(b)
(i) the representations and warranties of such Selling Securityholder in this
Agreement are true and correct as if made on and as of the Closing Date;
(i) to the extent that any statements or omissions are made in the Registration
Statement, any Preliminary Prospectus, the Prospectus or any amendment or
supplement thereto in reliance upon and in conformity with written
information furnished to the Company by such Selling Securityholder
specifically for use therein, the Registration Statement, as amended as of
the Closing Date, does not include any untrue statement of a material fact
or omit to state any
32
material fact necessary to make the statements therein not misleading,
and the Prospectus, as amended or supplemented as of the Closing Date,
does not include any untrue statement of a material fact or omit to state
any material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not
misleading; and
(i) such Selling Securityholder has performed all covenants and agreements on
its part to be performed or satisfied at or prior to the Closing Date.
(a) The Representatives shall have received from each person who is a director
or officer of the Company or who owns any securities of the Company or its
subsidiaries an agreement to the effect that such person will not, directly
or indirectly, without the prior written consent of Prudential Securities
Incorporated, on behalf of the Underwriters, offer, sell, offer to sell,
contract to sell, pledge, grant any option to purchase or otherwise sell or
dispose (or announce any offer, sale, offer of sale, contract of sale,
pledge, grant of any option to purchase or other sale or disposition) of
any shares of Common Stock or any securities convertible into, or
exchangeable or exercisable for, shares of Common Stock of itself or any
subsidiary or file any registration statement under the 1933 Act with
respect to any of the foregoing, except for filing a Registration Statement
on Form S-8 to register shares of Common Stock for issuance under the
Company stock option plan, for a period of 180 days from the date of the
Prospectus, except pursuant to this Agreement and except for issuances
pursuant to the existing employee benefit plans or stock option plans of
the Company outstanding on the date hereof or pursuant to the terms of
convertible securities of the Company outstanding on the date hereof, in
each case pursuant to the plans described in the Prospectus.
(b)
(c) On or before the Firm Closing Date, the Representatives and counsel for the
Underwriters shall have received such further certificates, documents or
other information as they may have reasonably requested from the Company.
(d)
(e) Prior to the commencement of the offering of the Securities, the Securities
shall have been included for trading on the Nasdaq National Market.
(f)
(g) All opinions, certificates, letters and documents delivered pursuant to
this Agreement will comply with the provisions hereof only if they are
reasonably satisfactory in all material respects to the Representatives and
counsel for the Underwriters. The Company shall furnish to the
Representatives such conformed copies of such opinions, certificates,
letters and documents in such quantities as the Representatives and counsel
for the Underwriters shall reasonably request.
(h)
33
(i) The respective obligations of the several Underwriters to purchase and pay
for any Option Securities shall be subject, in their discretion, to each of
the foregoing conditions to purchase the Firm Securities, except that all
references to the Firm Securities and the Firm Closing Date shall be deemed
to refer to such Option Securities and the related Option Closing Date,
respectively.
(j)
2. Indemnification and Contribution.
---------------------------------
3.
(a) The Company and each Selling Securityholder, jointly and severally, agree
to indemnify and hold harmless each Underwriter and each person, if any,
who controls any Underwriter within the meaning of Section 15 of the Act or
Section 20 of the Securities Exchange Act of 1934 (the "Exchange Act")
against any losses, claims, damages or liabilities, joint or several, to
which such Underwriter or such controlling person may become subject under
state law, common law, the Exchange Act, the Act, Canadian law or
otherwise, insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of or are based upon:
(b)
(i) any untrue statement or alleged untrue statement made by the Company or a
Principal Selling Securityholder in Section 2 or the Selling Security
holders in Section 3 of this Agreement; provided, however, that no
indemnification agreement is made by the Selling Securityholders other than
the Principal Selling Securityholders with respect to statements made in
Section 2;
(i) any untrue statement or alleged untrue statement of any material fact
contained in (A) the Registration Statement or any amendment or supplement
thereto, any Preliminary Prospectus or the Prospectus or any amendment or
supplement thereto or (B) any application or other document, or any
amendment or supplement thereto, executed by the Company or a Selling
Securityholder or based upon written information furnished by or on behalf
of the Company or a Selling Securityholder filed in any jurisdiction
(foreign or domestic) in order to qualify the Securities under the
securities or blue sky laws thereof or filed with the Commission or any
securities association or securities exchange (each a "Application");
(i) the omission or alleged omission to state in the Registration Statement or
any amendment or supplement thereto, any Preliminary Prospectus or the
Prospectus or any amendment or supplement thereto, or any Application a
material fact required to be stated therein or necessary to make the
statements therein not misleading; or
34
(i) any untrue statement or alleged untrue statement of any material fact
contained in any audio or visual materials provided by the Company or based
upon written information furnished by or on behalf of the Company,
including, without limitation, slides, videos, films, tape recordings, used
in connection with the marketing of the Securities, including, without
limitation, statements communicated to securities analysts employed by the
Underwriters;
and will reimburse, as incurred, each Underwriter and each such controlling
person for any legal or other expenses reasonably incurred by such Underwriter
or such controlling person in connection with investigating, defending against
or appearing as a third-party witness in connection with any such loss, claim,
damage, liability or action; provided, however, that the Company and each
-----------------
Selling Securityholder will not be liable in any such case to the extent that
any such loss, claim, damage or liability arises out of or is based upon any
untrue statement or alleged untrue statement or omission or alleged omission
made in such registration statement or any amendment thereto, any Preliminary
Prospectus, the Prospectus or any amendment or supplement thereto or any
Application in reliance upon and in conformity with written information
furnished to the Company by such Underwriter through the Representatives
specifically for use therein; and provided, further, that the Company and each
-------- --------
Selling Securityholder will not be liable to any Underwriter or any person
controlling such Underwriter with respect to any such untrue statement or
omission made in any Preliminary Prospectus that is corrected in the Prospectus
(or any amendment or supplement thereto) if the person asserting any such loss,
claim, damage or liability purchased Securities from such Underwriter but was
not sent or given a copy of the Prospectus (as amended or supplemented) at or
prior to the written confirmation of the sale of such Securities to such person
in any case where such delivery of the Prospectus (as amended or supplemented)
is required by the Act and it shall have been determined by a final judgment of
a court of competent jurisdiction that any Underwriter or any person controlling
such Underwriter would not have incurred such loss, claim, damage or liability
had the Prospectus (as amended or supplemented) been delivered or sent, unless
such failure to deliver the Prospectus (as amended or supplemented) was a result
of noncompliance by the Company with Section 6(d) and (e) of this Agreement.
This indemnity agreement will be in addition to any liability which the Company
and the Selling Securityholder may otherwise have. Neither the Company nor any
Selling Securityholder will, without the prior written consent of the
Representatives settle or compromise or consent to the entry of any judgment in
any pending or threatened claim, action, suit or proceeding in respect of which
indemnification may be sought hereunder (whether or not any such Underwriter or
any person who controls any such Underwriter within the meaning of Section 15 of
the Act or Section 20 of the Exchange Act is a party to
35
such claim, action, suit or proceeding), unless such settlement, compromise or
consent includes an unconditional release of all of the Underwriters and such
controlling persons from all liability arising out of such claim, action, suit
or proceeding.
(a) Each Underwriter, severally and not jointly, will indemnify and hold
harmless the Company, each of its directors, each of its officers who
signed the Registration Statement, each Selling Securityholder and each
person, if any, who controls the Company or such Selling Securityholder
within the meaning of Section 15 of the Act or Section 20 of the Exchange
Act against any losses, claims, damages or liabilities to which the Company
or any such director, officer or controlling person of the Company or such
Selling Securityholder may become subject under the Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon (i) any untrue statement or
alleged untrue statement of any material fact contained in the Registration
Statement or any amendment thereto, any Preliminary Prospectus or the
Prospectus or any amendment or supplement thereto, or any Application or
(ii) the omission or the alleged omission to state therein a material fact
required to be stated in the Registration Statement or any amendment
thereto, any Preliminary Prospectus or the Prospectus or any amendment or
supplement thereto, or any Application or necessary to make the statements
therein not misleading, in each case to the extent, but only to the extent,
that such untrue statement or alleged untrue statement or omission or
alleged omission was made in reliance upon and in conformity with written
information furnished to the Company by such Underwriter through the
Representatives specifically for use therein; and, subject to the
limitation set forth immediately preceding this clause, will reimburse, as
incurred, any legal or other expenses reasonably incurred by the Company or
any such director, officer or controlling person or such Selling
Securityholder in connection with investigating or defending any such loss,
claim, damage, liability or any action in respect thereof. This indemnity
agreement will be in addition to any liability which such Underwriter may
otherwise have.
(b)
(c) Promptly after receipt by an indemnified party under this Section 10 of
notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against the indemnifying party under
this Section 10, notify the indemnifying party of the commencement thereof;
but the omission so to notify the indemnifying party will not relieve it
from any liability which it may have to any indemnified party otherwise
than under this Section 10. In case any such action is brought against any
indemnified party, and it notifies the indemnifying party of the
commencement thereof, the indemnifying party will be entitled to
participate therein and, to the extent that it may wish, jointly with any
other indemnifying party similarly notified, to assume the defense thereof,
with counsel satisfactory to such indemnified party; provided, however,
-----------------
that if the defendants in
36
any such action include both the indemnified party and the indemnifying
party and the indemnified party shall have reasonably concluded that
there may be one or more legal defenses available to it and/or other
indemnified parties which are different from or additional to those
available to the indemnifying party, the indemnifying party shall not
have the right to direct the defense of such action on behalf of such
indemnified party or parties and such indemnified party or parties shall
have the right to select separate counsel to defend such action on behalf
of such indemnified party or parties. After notice from the indemnifying
party to such indemnified party of its election so to assume the defense
thereof and approval by such indemnified party of counsel appointed to
defend such action, the indemnifying party will not be liable to such
indemnified party under this Section 10 for any legal or other expenses,
other than reasonable costs of investigation, subsequently incurred by
such indemnified party in connection with the defense thereof, unless (i)
the indemnified party shall have employed separate counsel in accordance
with the proviso to the next preceding sentence (it being understood,
however, that in connection with such action the indemnifying party shall
not be liable for the expenses of more than one separate counsel (in
addition to local counsel) in any one action or separate but
substantially similar actions in the same jurisdiction arising out of the
same general allegations or circumstances, designated by the
Representatives in the case of paragraph (a) of this Section 10,
representing the indemnified parties under such paragraph (a) who are
parties to such action or actions) or (ii) the indemnifying party does
not promptly retain counsel satisfactory to the indemnified party or
(iii) the indemnifying party has authorized the employment of counsel for
the indemnified party at the expense of the indemnifying party. After
such notice from the indemnifying party to such indemnified party, the
indemnifying party will not be liable for the costs and expenses of any
settlement of such action effected by such indemnified party without the
consent of the indemnifying party.
(d)
(e) In circumstances in which the indemnity agreement provided for in the
preceding paragraphs of this Section 10 is unavailable or insufficient, for
any reason, to hold harmless an indemnified party in respect of any losses,
claims, damages or liabilities (or actions in respect thereof), each
indemnifying party, in order to provide for just and equitable
contribution, shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or
liabilities (or actions in respect thereof) in such proportion as is
appropriate to reflect (i) the relative benefits received by the
indemnifying party or parties on the one hand and the indemnified party on
the other from the offering of the Securities or (ii) if the allocation
provided by the foregoing clause (i) is not permitted by applicable law,
not only such relative benefits but also the relative fault of the
indemnifying party or parties on the one hand and the indemnified party on
the other in connection with the statements or omissions or alleged
statements or omissions that resulted in such losses, claims, damages or
liabilities (or actions in respect thereof), as well as any other relevant
equitable considerations. The relative benefits
37
received by the Company on the one hand and the Underwriters on the other
shall be deemed to be in the same proportion as the total proceeds from
the offering (before deducting expenses) received by the Company bear to
the total underwriting discounts and commissions received by the
Underwriters. The relative fault of the parties shall be determined by
reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the Company or the
Underwriters, the parties' relative intents, knowledge, access to
information and opportunity to correct or prevent such statement or
omission, and any other equitable considerations appropriate in the
circumstances. The Company and the Underwriters agree that it would not
be equitable if the amount of such contribution were determined by pro
rata or per capita allocation (even if the Underwriters were treated as
one entity for such purpose) or by any other method of allocation that
does not take into account the equitable considerations referred to above
in this paragraph (d). Notwithstanding any other provision of this
paragraph (d), no Underwriter shall be obligated to make contributions
hereunder that in the aggregate exceed the total public offering price of
the Securities purchased by such Underwriter under this Agreement, less
the aggregate amount of any damages that such Underwriter has otherwise
been required to pay in respect of the same or any substantially similar
claim, and no person guilty of fraudulent misrepresentation (within the
meaning of Section II (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 hereunder are several in
proportion to their respective underwriting obligations and not joint,
and contributions among Underwriters shall be governed by the provisions
of the Prudential Securities Incorporated Master Agreement Among
Underwriters. For purposes of this paragraph (d), each person, if any,
who controls an Underwriter within the meaning of Section 15 of the Act
or Section 20 of the Exchange Act shall have the same rights to
contribution as such Underwriter, and each director of the Company, each
officer of the Company who signed the Registration Statement and each
person, if any, who controls the Company within the meaning of Section 15
of the Act or Section 20 of the Exchange Act, shall have the same rights
to contribution as the Company.
(f)
2. Default of Underwriters. If one or more Underwriters default in
-----------------------
their obligations to purchase Firm Securities or Option Securities hereunder and
the aggregate number of such Securities that such defaulting Underwriter or
Underwriters agreed but failed to purchase is ten percent or less of the
aggregate number of Firm Securities or Option Securities to be purchased by all
of the Underwriters at such time hereunder, the other Underwriters may make
arrangements satisfactory to the Representatives for the purchase of such
Securities by other persons (who may include one or more of the non-defaulting
Underwriters, including the Representatives), but if no such arrangements are
made by the Firm Closing Date or the related Option Closing Date, as the case
may be, the other Underwriters shall
38
be obligated severally in proportion to their respective commitments hereunder
to purchase the Firm Securities or Option Securities that such defaulting
Underwriter or Underwriters agreed but failed to purchase. If one or more
Underwriters so default with respect to an aggregate number of Securities that
is more than ten percent of the aggregate number of Firm Securities or Option
Securities, as the case may be, to be purchased by all of the Underwriters at
such time hereunder, and if arrangements satisfactory to the Representatives
are not made within 36 hours after such default for the purchase by other
persons (who may include one or more of the non-defaulting Underwriters,
including the Representatives) of the Securities with respect to which such
default occurs, this Agreement will terminate without liability on the part of
any non-defaulting Underwriter or the Company other than as provided in
Section 12 hereof. In the event of any default by one or more Underwriters as
described in this Section 11, the Representatives shall have the right to
postpone the Firm Closing Date or the Option Closing Date, as the case may be,
established as provided in Section 4 hereof for not more than seven business
days in order that any necessary changes may be made in the arrangements or
documents for the purchase and delivery of the Firm Securities or Option
Securities, as the case may be. As used in this Agreement, the term
"Underwriter" includes any person substituted for an Underwriter under this
Section 11. Nothing herein shall relieve any defaulting Underwriter from
liability for its default.
3.
4. Survival. The respective representations, warranties, agreements,
--------
covenants, indemnities and other statements of the Company, its officers and the
several Underwriters set forth in this Agreement or made by or on behalf of
them, respectively, pursuant to this Agreement shall remain in full force and
effect, regardless of (i) any investigation made by or on behalf of the Company,
any of its officers or directors, any Underwriter or any controlling person
referred to in Section 10 hereof and (ii) delivery of and payment for the
Securities. The respective agreements, covenants, indemnities and other
statements set forth in Sections 2, 6,7 and 10 hereof shall remain in full force
and effect, regardless of any termination or cancellation of this Agreement.
5.
6. Termination.
-----------
7.
(a) This Agreement may be terminated with respect to the Firm Securities or any
Option Securities in the sole discretion of the Representatives by notice
to the Company given prior to the Firm Closing Date or the related Option
Closing Date, respectively, in the event that the Company shall have
failed, refused or been unable to perform all obligations and satisfy all
conditions on its part to be performed or satisfied hereunder at or prior
thereto or, if at or prior to the Firm Closing Date or such Option Closing
Date, respectively,
(b)
39
(i) the Company or any of its subsidiaries shall have, in the sole judgment of
the Representatives, sustained any material loss or interference with their
respective businesses or properties from fire, flood, hurricane, accident
or other calamity, whether or not covered by insurance, or from any labor
dispute or any legal or governmental proceeding or there shall have been
any material adverse change, or any development involving a prospective
material adverse change (including without limitation a change in
management or control of the Company), in the condition (financial or
otherwise), business prospects, net worth or results of operations of the
Company and its subsidiaries;
(i) trading in the Common Stock shall have been suspended by the Commission or
the Nasdaq National Market or trading in securities generally on the New
York Stock Exchange or Nasdaq National Market shall have been suspended or
minimum or maximum prices shall have been established on any such exchange
or market system;
(i) a banking moratorium shall have been declared by New York or United States
authorities; or
(i) there shall have been (A) an outbreak or escalation of hostilities between
the United States and any foreign power, (B) an outbreak or escalation of
any other insurrection or armed conflict involving the United States or (C)
any other calamity or crisis or material adverse change in general
economic, political or financial conditions having an effect on the U.S.
financial markets that, in the sole judgment of the Representatives, makes
it impractical or inadvisable to proceed with the public offering or the
delivery of the Securities as contemplated by the Registration Statement,
as amended as of the date hereof.
(a) Termination of this Agreement pursuant to this Section 13 shall be without
liability of any party to any other party except as provided in Section 12
hereof.
(b)
2. Limitation of Liability.
------------------------
3.
4. The liability of each Selling Securityholder, including the
Principal Selling Security holders, under Sections 2 and 10 shall not exceed an
amount equal to the initial public offering price of the Option Securities sold
by such Selling Securityholder to the Underwriters. The Underwriters shall seek
indemnification or
40
other remedies, to which they are entitled under Sections 2 and 10 first from
the Company. If the Company does not respond to the Underwriters after 30
days, then the Underwriters may seek such indemnification or other remedies
from the Selling Security holders. In the event that the Underwriters are
unable (or believe that they will be unable to) obtain such indemnification or
other remedies from the Company, the Underwriters may then seek
indemnification or other remedies from the Selling Security holders.
5.
6. Information Supplied by Underwriters. The statements set forth in the
-------------------------------------
last paragraph on the front cover page and under, the tables below paragraphs 1
and 4, and paragraphs 2, 3, 8, 9, 11- 13, of the heading "Underwriting" in any
Preliminary Prospectus or the Prospectus (to the extent such statements relate
to the Underwriters) constitute the only information furnished by any
Underwriter through the Representatives to the Company for the purposes of
Sections 2(b) and 10 hereof. The Underwriters confirm that such statements (to
such extent) are correct.
7.
8. Notices. All communications hereunder shall be in writing and, if
-------
sent to any of the Underwriters, shall be delivered or sent by mail, telex or
facsimile transmission and confirmed in writing to Prudential Securities
Incorporated, Xxx Xxx Xxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Equity
Transactions Group; with a copy to Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP, 000
Xxxxxxxxxx Xxxxxx, Xxxxx 000, Xxxx Xxxx, XX 00000, Attention: Xxxxxxx X.
Xxxxx, and if sent to the Company, shall be delivered or sent by mail, telex or
facsimile transmission and confirmed in writing to the Company at 000 Xxxxxxxxxx
Xxxxxx, Xxxx Xxxx, XX 00000, Attention: Xxxxxxx X. Xxxxxx; with a copy to
Wilson, Sonsini, Xxxxxxxx & Xxxxxx, a professional corporation, 000 Xxxx Xxxx
Xxxx, Xxxx Xxxx, XX 00000, Attention: Xxxxx X. Xxxxxx.
9.
10. Successors. This Agreement shall inure to the benefit of and shall be
----------
binding upon the several Underwriters, the Company and their respective
successors and legal representatives, and nothing expressed or mentioned in this
Agreement is intended or shall be construed to give any other person any legal
or equitable right, remedy or claim under or in respect of this Agreement, or
any provisions herein contained, this Agreement and all conditions and
provisions hereof being intended to be and being for the sole and exclusive
benefit of such persons and for the benefit of no other person except that (i)
the indemnities of the Company contained in Section 10 of this Agreement shall
also be for the benefit of any person or persons who control any Underwriter
within the meaning of Section 15 of the
41
Act or Section 20 of the Exchange Act and (ii) the indemnities of the
Underwriters contained in Section 10 of this Agreement shall also be for the
benefit of the directors of the Company, the officers of the Company who have
signed the Registration Statement and any person or persons who control the
Company within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act. No purchaser of Securities from any Underwriter shall be deemed
a successor because of such purchase.
11.
12. Applicable Law. The validity and interpretation of this Agreement,
--------------
and the terms and conditions set forth herein, shall be governed by and
construed in accordance with the laws of the State of New York, without giving
effect to any provisions relating to conflicts of laws.
13.
14. Consent to Jurisdiction and Service of Process. All judicial
----------------------------------------------
proceedings arising out of or relating to this Agreement may be brought in any
state or federal court of competent jurisdiction in the State of New York, and
by execution and delivery of this Agreement, each Selling Securityholder accepts
for itself and in connection with its properties, generally and unconditionally,
the nonexclusive jurisdiction of the aforesaid courts and waives any defense of
forum non conveniens and irrevocably agrees to be bound by any judgment rendered
thereby in connection with this Agreement. Each Selling Securityholder
designates and appoints Xxxxx X. XxXxxxx, and such other persons as may
hereafter be selected by such Selling Securityholder irrevocably agreeing in
writing to so serve, as its agent to receive on its behalf service of all
process in any such proceedings in any such court, such service being hereby
acknowledged by such Selling Securityholder to be effective and binding service
in every respect. A copy of any such process so served shall be mailed by
registered mail to each Selling Securityholder at its address provided in
Section 15 hereof; provided, however, that, unless otherwise provided by
-------- -------
applicable law, any failure to mail such copy shall not affect the validity of
service of such process. If any agent appointed by any Selling Securityholder
refuses to accept service, such Selling Securityholder hereby agrees that
service of process sufficient for personal jurisdiction in any action against
such Selling Securityholder in the State of New York may be made by registered
or certified mail, return receipt requested, to such Selling Securityholder at
its address provided in Section 15 hereof, and such Selling Securityholder
hereby acknowledges that such service shall be effective and binding in every
respect. Nothing herein shall affect the right to serve process in any other
manner permitted by law or shall limit the right of any Underwriter to bring
proceedings against any Selling Securityholder in the courts of any other
jurisdiction.
15.
16. Counterparts. This Agreement may be executed in two or more
------------
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
17.
42
If the foregoing correctly sets forth our understanding, please indicate
your acceptance thereof in the space provided below for that purpose, whereupon
this letter shall constitute an agreement binding the Company and each of the
several Underwriters.
Very truly yours,
xxxxxx.xxx, Inc.
By ________________________
[Title]
PRINCIPAL SELLING SECURITYHOLDERS
By ________________________
Name: Xxxxx X. XxXxxxx
By ________________________
Name: Xxxxxx Field
SELLING SECURITYHOLDERS
By ________________________
Attorney-in-Fact
The foregoing Agreement is hereby
confirmed and accepted as of the
date first above written.
PRUDENTIAL SECURITIES INCORPORATED
XXXX XXXXXXXX XXXXXXX, A Division of
Xxxx Xxxxxxxx Incorporated
43
XXXXX XXXXX XXXXXX & COMPANY
E*OFFERING CORP.
By PRUDENTIAL SECURITIES INCORPORATED
By _____________________
Xxxx-Xxxxxx Canfin
Managing Director
For itself and on behalf of the Representatives.
44
SCHEDULE 1
UNDERWRITERS
Securities to Number of Firm
Underwriter be Purchased
----------- ------------
PRUDENTIAL SECURITIES INCORPORATED.......
XXXX XXXXXXXX XXXXXXX, a division of
Xxxx Xxxxxxxx Incorporated
XXXXX XXXXX XXXXXX & COMPANY
E*OFFERING CORP.
_______________
Total ..............
45
SCHEDULE 2
SUBSIDIARIES
Name Jurisdiction of Incorporation
---- -----------------------------
46
SCHEDULE 3
Name Number of Shares to be Sold
---- ---------------------------
xxxxxx.xxx, Inc.
Xxxxx X. XxXxxxx
Xxxxxx Field
Xxxxxx X. Xxxxxx
Vestmark Limited
47
