CADMUS COMMUNICATIONS CORPORATION
1,500,000 Shares
Common Stock
Underwriting Agreement
_____________, 1995
X.X. Xxxxxx Securities Inc.
Interstate/Xxxxxxx Lane Corporation
As Representatives
of the Several Underwriters
Listed in Schedule I hereto
c/o X.X. Xxxxxx Securities Inc.
00 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
Cadmus Communications Corporation, a Virginia corporation (the
"Company"), proposes to issue and sell to the several Underwriters listed
in Schedule I hereto (the "Underwriters"), for whom you are acting as
representatives (the "Representatives"), an aggregate of 1,500,000 shares
of common stock, par value $.50 per share, of the Company (the
"Underwritten Shares") and, for the sole purpose of covering
over-allotments in connection with the sale of the Underwritten Shares, at
the option of the Underwriters, up to an additional 225,000 shares of
common stock, par value $.50 per share, of the Company (the "Option
Shares"). The Underwritten Shares and the Option Shares are herein
referred to as the "Shares." The shares of common stock of the Company to
be outstanding after giving effect to the sale of the Shares are herein
referred to as the "Common Stock." Each Share will have attached thereto a
Preferred Stock Purchase Right (a "Right").
The Company has prepared and filed with the Securities and Exchange
Commission (the "Commission") in accordance with the provisions of the
Securities Act of 1933, as amended, and the rules and regulations of the
Commission thereunder (collectively, the "Securities Act"), a registration
statement on Form S-3 (file no. 33-62655), including a prospectus, relating
to the Shares and Rights. Such registration statement, as amended at the
time when it shall become effective, or, if a post-effective amendment is
filed with respect thereto, as amended by such post-effective amendment at
the time of its effectiveness, including in each case information (if any)
deemed to be part of the registration statement at the time of
effectiveness pursuant to Rule 430A under the Securities Act, together with
any related registration statement filed with the Commission for
registration of a portion of the Shares which registration statement
becomes effective pursuant to Rule 462(b) under the Securities Act, is
referred to in this Agreement as the "Registration Statement," and the
prospectus in the form first used to confirm sales of Shares is referred to
in this Agreement as the "Prospectus." Any reference in this Agreement to
the Registration Statement, any preliminary prospectus or the Prospectus
shall be deemed to refer to and include the documents incorporated by
reference therein pursuant to Item 12 of Form S-3 under the Securities Act,
as of the effective date of the Registration Statement or the date of such
preliminary prospectus or the Prospectus, as the case may be, and any
reference to "amend," "amendment" or "supplement" with respect to the
Registration Statement, any preliminary prospectus or the Prospectus shall
be deemed to refer to and include any documents filed after such date under
the Securities Exchange Act of 1934, as amended, and the rules and
regulations of the Commission thereunder (collectively, the "Exchange
Act"), that are deemed to be incorporated by reference therein.
The Company hereby agrees with the Underwriters as follows:
1. The Company agrees to issue and sell the Underwritten Shares
to the several Underwriters as hereinafter provided, and each Underwriter,
upon the basis of the representations and warranties herein contained, but
subject to the conditions hereinafter stated, agrees to purchase, severally
and not jointly, from the Company the respective number of Underwritten
Shares set forth opposite such Underwriter's name in Schedule I hereto at a
purchase price (the "Purchase Price") of $____ per share.
In addition, the Company agrees to issue and sell the Option Shares
to the several Underwriters as hereinafter provided, and the Underwriters
on the basis of the representations and warranties herein contained, but
subject to the conditions hereafter stated, shall have the option to
purchase, severally and not jointly, from the Company up to an aggregate of
225,000 Option Shares at the Purchase Price for the sole purpose of
covering over-allotments (if any) in the sale of Underwritten Shares by the
several Underwriters.
If any Option Shares are to be purchased, the number of Option
Shares to be purchased by each Underwriter shall be the number of Option
Shares which bears the same ratio to the aggregate number of Option Shares
being purchased as the number of Underwritten Shares set forth opposite the
name of such Underwriter in Schedule I hereto (or such amount increased as
set forth in Section 9 hereof) bears to the aggregate number of
Underwritten Shares being purchased from the Company by the several
Underwriters, subject, however, to such adjustments to eliminate any
fractional shares as the Representatives in their sole discretion shall
make.
2
The Underwriters may exercise the option to purchase the Option
Shares at any time (but not more than once) on or before the thirtieth day
following the date of this Agreement, by written notice from the
Representatives to the Company. Such notice shall set forth the aggregate
number of Option Shares as to which the option is being exercised and the
date and time when the Option Shares are to be delivered and paid for which
may be the same date and time as the Closing Date (as hereinafter defined)
but shall not be earlier than the Closing Date nor later than the tenth
full Business Day (as hereinafter defined) after the date of such notice
(unless such time and date are postponed in accordance with the provisions
of Section 9 hereof). Any such notice shall be given at least two Business
Days prior to the date and time of delivery specified therein.
2. The Company understands that the Underwriters intend (i) to
make a public offering of the Shares as soon after the Registration
Statement and this Agreement have become effective as in the judgment of
the Representatives is advisable and (ii) initially to offer the Shares
upon the terms set forth in the Prospectus.
3. Payment for the Shares shall be made to the Company or to its
order by certified or official bank check or checks payable in New York
Clearing House or other next day funds (unless the Company requires payment
in same day funds, in which event the Company shall pay the Underwriters
for the costs associated with payment in same day funds) at the office of
X.X. Xxxxxx Securities Inc., 00 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 at
10:00 A.M., New York City time, in the case of the Underwritten Shares, on
_________, 1995, or at such other time on the same or such other date, not
later than the fifth Business Day thereafter, as the Representatives and
the Company may agree upon in writing or, in the case of the Option Shares,
on the date and time specified by the Representatives in the written notice
of the Underwriters' election to purchase such Option Shares. The time and
date of such payment for the Underwritten Shares are referred to herein as
the Closing Date and the time and date for such payment for the Option
Shares, if other than the Closing Date, are herein referred to as the
Additional Closing Date. As used herein, the term "Business Day" means any
day other than a day on which banks are permitted or required to be closed
in New York City.
Payment for the Shares to be purchased on the Closing Date or
Additional Closing Date, as the case may be, shall be made against delivery
to the Representatives for the respective accounts of the several
Underwriters of the Shares to be purchased on such date registered in such
names and in such denominations as the Representatives shall request in
writing not later than two full Business Days prior to the Closing Date or
the Additional Closing Date, as the case may be, with any transfer taxes
payable in connection with the transfer to the Underwriters of the Shares
duly paid by the Company. The certificates for the Shares will be made
available for inspection and packaging by the Representatives at the office
of X.X. Xxxxxx Securities Inc. set forth above not later than 1:00 P.M.,
New York City time, on the Business Day prior to the Closing Date or the
Additional Closing Date, as the case may be.
3
4. The Company represents and warrants to each Underwriter that:
(a) no order preventing or suspending the use of any preliminary
prospectus has been issued by the Commission, and each preliminary
prospectus filed as part of the Registration Statement as originally
filed or as part of any amendment thereto, or filed pursuant to Rule 424
under the Securities Act, complied when so filed in all material
respects with the Securities Act, and did not contain an untrue
statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein, in the
light of the circumstances under which they were made, not misleading;
provided that this representation and warranty shall not apply to any
statements or omissions made in reliance upon and in conformity with
information relating to any Underwriter furnished to the Company in
writing by such Underwriter through the Representatives expressly for
use therein;
(b) no stop order suspending the effectiveness of the Registration
Statement has been issued and no proceeding for that purpose has been
instituted or, to the knowledge of the Company, threatened by the
Commission; and the Registration Statement and Prospectus (as amended or
supplemented if the Company shall have furnished any amendments or
supplements thereto) comply, or will comply, as the case may be, in all
material respects with the Securities Act and do not and will not, as of
the applicable effective date as to the Registration Statement and any
amendment thereto and as of the date of the Prospectus and any amendment
or supplement thereto, contain any untrue statement of a material fact
or omit to state any material fact required to be stated therein or
necessary to make the statements therein not misleading, and the
Prospectus, as amended or supplemented at the Closing Date, if
applicable, will not as of the Closing Date contain any untrue statement
of a material fact or omit to state a material fact necessary to make
the statements therein, in the light of the circumstances under which
they were made, not misleading; except that the foregoing
representations and warranties shall not apply to statements or
omissions in the Registration Statement or the Prospectus made in
reliance upon and in conformity with information relating to any
Underwriter furnished to the Company in writing by such Underwriter
through the Representatives expressly for use therein;
(c) the documents incorporated by reference in the Prospectus, when
they were filed with the Commission, conformed in all material respects
to the requirements of the Exchange Act and none of such documents
contained an untrue statement of a material fact or omitted to state a
material fact necessary to make the statements therein, in the light of
the circumstances under which they are made, not misleading; and any
further documents so filed and incorporated by reference in the
Prospectus, when such documents are filed with the Commission, will
conform in all material respects to the requirements of the Exchange
Act, and will not contain an untrue statement of a material fact or omit
to state a material fact necessary to make the statements therein, in
4
the light of the circumstances under which they were made, not
misleading;
(d) the financial statements, and the related notes thereto,
included or incorporated by reference in the Registration Statement and
the Prospectus present fairly the consolidated financial position of the
Company and its consolidated subsidiaries as of the dates indicated and
the results of their operations and the changes in their consolidated
cash flows for the periods specified; said financial statements have
been prepared in conformity with generally accepted accounting
principles applied on a consistent basis throughout the periods
indicated, and the supporting schedules included or incorporated by
reference in the Registration Statement present fairly the information
required to be stated therein; the pro forma financial information,
including the related notes thereto, included or incorporated by
reference in the Registration Statement and the Prospectus has been
prepared in accordance with the applicable requirements of the
Securities Act and the Exchange Act, as applicable and is based upon
good faith estimates and assumptions believed by the Company to be
reasonable; and the accountants who have certified or shall certify the
financial statements filed or to be filed with the Commission as part of
the Registration Statement are independent accountants as required by
the Securities Act;
(e) since the respective dates as of which information is given in
the Registration Statement and the Prospectus, there has not been any
material adverse change, or any development involving a prospective
material adverse change, in or affecting the general affairs, business,
management, financial position, shareholders' equity or results of
operations of the Company and its subsidiaries, taken as a whole
("Material Adverse Change"), otherwise than as set forth or contemplated
in the Prospectus; and except as set forth or contemplated in the
Prospectus neither the Company nor any of its subsidiaries has entered
into any transaction or agreement (whether or not in the ordinary course
of business) material to the Company and its subsidiaries taken as a
whole;
(f) the Company has been duly incorporated and is validly existing
as a corporation in good standing under the laws of the state of its
incorporation, with corporate power and authority to own its properties
and conduct its business as described in the Prospectus, and has been
duly qualified as a foreign corporation for the transaction of business
and is in good standing under the laws of each other jurisdiction in
which it owns or leases properties, or conducts any business, so as to
require such qualification, other than where the failure to be so
qualified or in good standing could not reasonably be expected to have a
material adverse effect on the general affairs, business, management,
financial position, shareholders' equity or results of operations of the
Company and its subsidiaries taken as a whole ("Material Adverse
Effect");
5
(g) each of the Company's subsidiaries set forth in Annex A hereto
(the "Material Subsidiaries") has been duly incorporated and is validly
existing as a corporation under the laws of its jurisdiction of
incorporation, with corporate power and authority to own its properties
and conduct its business as described in the Prospectus, and has been
duly qualified as a foreign corporation for the transaction of business
and is in good standing under the laws of each jurisdiction in which it
owns or leases properties or conducts any business so as to require such
qualification, other than where the failure to be so qualified or in
good standing would not have a material adverse effect on the Company
and its subsidiaries taken as a whole; and all the outstanding shares of
capital stock of each subsidiary of the Company have been duly
authorized and validly issued, are fully-paid and non-assessable, and
(except in the case of foreign subsidiaries, for directors' qualifying
shares) are owned by the Company, directly or indirectly, free and clear
of all liens, encumbrances, security interests and claims;
(h) this Agreement has been duly authorized, executed and
delivered by the Company;
(i) the authorized capital stock of the Company conforms to the
description thereof set forth in the Registration Statement and the
Prospectus, and all of the outstanding shares of capital stock of the
Company have been duly authorized and validly issued, are fully paid and
non-assessable; and, except as described in or expressly contemplated by
the Prospectus, there are no outstanding rights (including, without
limitation, any preemptive or other rights to subscribe for shares of
capital stock), warrants or options to acquire, or instruments
convertible into or exchangeable for, any shares of capital stock or
other equity interest in the Company or any of its subsidiaries, or any
contract, commitment, agreement, understanding or arrangement of any
kind relating to the issuance of any capital stock of the Company or any
such subsidiary, any such convertible or exchangeable securities or any
such rights, warrants or options;
(j) the Shares to be issued and sold by the Company hereunder have
been duly authorized, and, when delivered to and paid for by the
Underwriters in accordance with the terms of this Agreement, will have
been duly issued and will be fully paid and non-assessable and will
conform to the descriptions thereof in the Prospectus; and the issuance
of the Shares is not subject to any preemptive or similar right;
(k) the Rights to be attached to the Shares have been duly
authorized and, when the Shares have been duly and validly issued in
accordance with the terms of this Agreement, will have been validly
issued;
(l) neither the Company nor any of its subsidiaries is, or with
the giving of notice or lapse of time or both would be, in violation of
or in default under, its Articles of Incorporation or By-Laws or any
indenture, mortgage, deed of trust, loan agreement or other agreement or
6
instrument to which the Company or any of its subsidiaries is a party or
by which it or any of them or any of their respective properties is
bound, except for violations and defaults which individually and in the
aggregate could not be expected to have a Material Adverse Effect; the
issue and sale of the Shares and the performance by the Company of its
obligations under this Agreement and the consummation of the
transactions contemplated herein will not conflict with or result in a
breach of any of the terms or provisions of, or constitute a default
under, any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which the Company or any of its subsidiaries
is a party or by which the Company or any of its subsidiaries is bound
or to which any of the property or assets of the Company or any of its
subsidiaries is subject, except for defaults that individually or in the
aggregate could not reasonably be expected to have a Material Adverse
Effect, nor will any such action result in any violation of the
provisions of the Articles of Incorporation or the By-Laws of the
Company or any applicable law or statute or any order, rule or
regulation of any court or governmental agency or body having
jurisdiction over the Company, its subsidiaries or any of their
respective properties, except for defaults that individually or in the
aggregate could not reasonably be expected to have a Material Adverse
Effect; and no consent, approval, authorization, order, registration or
qualification of or with any such court or governmental agency or body
is required for the issue and sale of the Shares or the consummation by
the Company of the transactions contemplated by this Agreement, except
such consents, approvals, authorizations, registrations or
qualifications as have been obtained under the Securities Act and as may
be required under state securities or Blue Sky laws in connection with
the purchase and distribution of the Shares by the Underwriters;
(m) other than as set forth or contemplated in the Prospectus,
there are no legal or governmental proceedings pending or, to the
knowledge of the Company, threatened to which the Company or any of its
subsidiaries is or may be a party or to which any property of the
Company or any of its subsidiaries is or may be the subject which, if
determined adversely to the Company, could individually or in the
aggregate reasonably be expected to have a Material Adverse Effect, and,
to the Company's knowledge, no such proceedings are threatened or
contemplated by governmental authorities or threatened by others; and
there are no contracts or other documents of a character required to be
filed as an exhibit to the Registration Statement or required to be
described in the Registration Statement or the Prospectus which are not
filed or described as required;
(n) the Company and its subsidiaries have good and marketable
title in fee simple to all items of real property and good and
marketable title to all personal property owned by them, in each case
free and clear of all liens, encumbrances and defects except such as are
described or referred to in the Prospectus or such as could not be
expected to materially affect the value of such property and do not
interfere with the use made or proposed to be made of such property by
7
the Company and its subsidiaries; and any real property and buildings
held under lease by the Company and its subsidiaries are held by them
under valid, existing and enforceable leases with such exceptions as
could not reasonably be expected to have a Material Adverse Effect and
do not interfere with the use made or proposed to be made of such
property and buildings by the Company or its subsidiaries;
(o) [except for such rights that have been waived,] no person has
the right to require the Company to register any securities for offering
and sale under the Securities Act by reason of the filing of the
Registration Statement with the Commission or the issue and sale of the
Shares;
(p) the Company and its subsidiaries (i) are in compliance with
any and all applicable foreign, federal, state and local laws and
regulations relating to the protection of human health and safety, the
environment or hazardous or toxic substances or wastes, pollutants or
contaminants ("Environmental Laws"), (ii) have received all permits,
licenses or other approvals required of them under applicable
Environmental Laws to conduct their respective businesses and (iii) are
in compliance with all terms and conditions of any such permit, license
or approval, except where such noncompliance with Environmental Laws,
failure to receive required permits, licenses or other approvals or
failure to comply with the terms and conditions of such permits,
licenses or approvals would not, singly or in the aggregate, reasonably
be expected to have a Material Adverse Effect;
(q) in the ordinary course of its business, the Company conducts a
periodic review of the effect of Environmental Laws on the business,
operations and properties of the Company and its subsidiaries, in the
course of which it identifies and evaluates material associated costs
and liabilities (including, without limitation, any material capital or
operating expenditures required for clean-up, closure of properties or
compliance with Environmental Laws or any permit, license or approval,
any material related constraints on operating activities and any
material potential liabilities to third parties). On the basis of such
review, the Company has reasonably concluded that such associated costs
and liabilities could not, singly or in the aggregate, reasonably be
expected to have a material adverse effect on the Company and its
subsidiaries, taken as a whole;
(r) the Company has complied with all provisions of Section
517.075, Florida Statutes (Chapter 92-198, Laws of Florida).
5. The Company covenants and agrees with the several Underwriters
as follows:
(a) to use its best efforts to cause the Registration Statement to
become effective (if the Registration Statement shall not have been
declared effective prior to the effective time hereof) at the earliest
possible time and, if required, to file the final Prospectus with the
8
Commission within the time periods specified by Rule 424(b) and Rule
430A under the Securities Act;
(b) to deliver, at the expense of the Company, (i) to the
Representatives, three conformed copies of the Registration Statement
(as originally filed) and three signed copies of each amendment thereto,
in each case including exhibits and documents incorporated by reference
therein, (ii) to each other Underwriter a conformed copy of the
Registration Statement (as originally filed) and each amendment thereto,
in each case without exhibits but including the documents incorporated
by reference therein and (iii) upon request as many copies of the
Prospectus (including all amendments and supplements thereto and
documents incorporated by reference therein) as the Representatives may
reasonably request;
(c) before filing any amendment or supplement to the Registration
Statement or the Prospectus, whether before or after the time the
Registration Statement becomes effective under the Securities Act, to
furnish to the Representatives a copy of the proposed amendment or
supplement for review and not to file any such proposed amendment or
supplement to which the Representatives reasonably object by prompt
notice to the Company;
(d) to advise the Representatives promptly, and to deliver any
written communications from the Commission or any state securities
commission, (i) when the Registration Statement shall become effective
under the Securities Act, (ii) when any amendment to the Registration
Statement shall have become effective under the Securities Act, (iii) of
any request by the Commission for any amendment to the Registration
Statement or any amendment or supplement to the Prospectus or for any
additional information, (iv) of the issuance by the Commission of any
stop order suspending the effectiveness of the Registration Statement or
the initiation or threatening of any proceeding for that purpose, and
(v) of the receipt by the Company of any notification with respect to
any suspension of the qualification of the Shares for offer and sale in
any jurisdiction or the initiation or threatening of any proceeding for
such purpose; and to use its best efforts to prevent the issuance of any
such stop order or notification and, if issued, to obtain as soon as
possible the withdrawal thereof;
(e) if, during such period of time after the first date of the
public offering of the Shares as in the opinion of counsel for the
Underwriters a prospectus relating to the Shares is required by law to
be delivered in connection with sales by the Underwriters or any dealer,
any event shall occur that is known to the Company or information shall
become known to the Company as a result of which it is necessary to
amend or supplement the Prospectus in order to make the statements
therein, in the light of the circumstances at the time the Prospectus is
delivered to a purchaser, not misleading, or if it is necessary to amend
or supplement the Prospectus to comply with law, forthwith to prepare,
file with the Commission and furnish, at the expense of the Company, to
9
the Underwriters such amendments or supplements to the Prospectus as may
be necessary so that the statements in the Prospectus as so amended or
supplemented will not, in the light of the circumstances when the
Prospectus is delivered to a purchaser, be misleading or so that the
Prospectus will comply with law, provided that all expenses with respect
to any amendment of or supplement to the Prospectus required to correct
a misleading statement made therein in reliance upon or in conformity
with information relating to an Underwriter furnished to the Company in
writing by a Representative expressly for use therein shall be borne by
the Representatives;
(f) to endeavor to qualify the Shares for offer and sale under the
securities or Blue Sky laws of such jurisdictions as the Representatives
shall reasonably request and to continue such qualification in effect so
long as reasonably required for distribution of the Shares and to pay
all fees and expenses (including fees and disbursements of counsel to
the Underwriters) reasonably incurred in connection with such
qualification; provided that the Company shall not be required to file a
general consent to service of process in any jurisdiction;
(g) to make generally available to its security holders and to the
Representatives as soon as practicable an earnings statement covering a
period of at least twelve months beginning with the first fiscal quarter
of the Company occurring after the effective date of the Registration
Statement, that shall satisfy the provisions of Section 11(a) of the
Securities Act and Rule 158 of the Commission promulgated thereunder;
(h) for a period of five years from the date hereof, to furnish to
the Representatives copies of all reports or other communications
(financial or other) furnished to holders of Shares, and copies of any
reports and financial statements furnished to or filed with the
Commission, the Nasdaq National Market or any national securities
exchange;
(i) for a period of 90 days after the date of the initial public
offering of the Shares not to offer, sell, contract to sell or otherwise
dispose of any shares of common stock of the Company or any securities
convertible into or exercisable or exchangeable for shares of common
stock of the Company without the prior written consent of X.X. Xxxxxx
Securities Inc., other than the Shares to be sold hereunder and any
shares of common stock of the Company issued upon the exercise of
options granted under existing employee stock option, savings or
purchase plans; and
(j) to pay all costs and expenses incident to the performance of
its obligations hereunder, including without limiting the generality of
the foregoing, all costs and expenses (i) incident to the preparation,
issuance, execution and delivery of the Shares, (ii) incident to the
preparation, printing and filing under the Securities Act of the
Registration Statement, the Prospectus and any preliminary prospectus
(including in each case all exhibits, amendments and supplements thereto
10
unless otherwise provided herein), (iii) incurred in connection with the
registration or qualification of the Shares under the laws of such
jurisdictions as the Representatives may designate (including fees of
counsel for the Underwriters and its disbursements), (iv) in connection
with the quotation of the Shares by the Nasdaq National Market, (v)
related to the filing with, and clearance of the offering by, the
National Association of Securities Dealers, Inc. and (vi) in connection
with the printing (including word processing and duplication costs) and
delivery of this Agreement, the Preliminary and Supplemental Blue Sky
Memoranda and the furnishing to the Underwriters and dealers of copies
of the Registration Statement and the Prospectus, including mailing and
shipping, as herein provided. It is understood that, except as provided
in Sections 7 and 10 hereof, the Underwriters shall pay their own costs
and expenses, including the fees of their counsel, stock transfer taxes
on resale of the Shares by them and any advertising expenses connected
with any offers they make.
6. The several obligations of the Underwriters hereunder to
purchase the Underwritten Shares are subject to the performance by the
Company of its obligations hereunder and to the following additional conditions:
(a) the Registration Statement shall have become effective (or if
a post-effective amendment is required to be filed under the Securities
Act, such post-effective amendment shall have become effective) not
later than 5:00 P.M., New York City time, on the date hereof; and no
stop order suspending the effectiveness of the Registration Statement
shall be in effect, and no proceedings for such purpose shall be pending
before or threatened by the Commission; the Company shall have filed, if
required, the final Prospectus with the Commission within the time
periods and in the manner specified by Rule 424(b) and Rule 430A under
the Securities Act; and all requests for additional information shall
have been complied with to the satisfaction of the Representatives;
(b) the representations and warranties of the Company contained
herein are true and correct on and as of the Closing Date as if made on
and as of the Closing Date and the Company shall have complied with all
agreements and all conditions on its part to be performed or satisfied
hereunder at or prior to the Closing Date;
(c) subsequent to the execution and delivery of this Agreement and
prior to the Closing Date, there shall not have occurred any
downgrading, nor shall any notice have been given of (i) any intended or
potential downgrading or (ii) any possible change that does not indicate
an improvement, in the rating accorded any securities of or guaranteed
by the Company by any "nationally recognized statistical rating
organization", as such term is defined for purposes of Rule 436(g)(2)
under the Securities Act the effect of which is in the Representatives'
judgement so material and adverse as to make it impracticable or
inadvisable to proceed with the public offering or delivery of the
Shares on the terms and in the manner contemplated in the Prospectus;
11
(d) since the respective dates as of which information is given in
the Prospectus there shall not have been any Material Adverse Change or
any development involving a prospective Material Adverse Change,
otherwise than as set forth or contemplated in the Prospectus, the
effect of which in the judgment of the Representatives makes it
impracticable or inadvisable to proceed with the public offering or the
delivery of the Shares on the terms and in the manner contemplated in
the Prospectus;
(e) the Representatives shall have received on and as of the
Closing Date a certificate of an executive officer of the Company
satisfactory to the Representatives to the effect set forth in
subsections (a) through (c) of this Section and as to whether there has
occurred any Material Adverse Change, or any development involving a
prospective Material Adverse Change from that set forth or contemplated
in the Registration Statement;
(f) Hunton & Xxxxxxxx, counsel for the Company, shall have
furnished to the Representatives their written opinion, dated the
Closing Date, in form and substance satisfactory to the Representatives,
to the effect that:
(i) the Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of its
jurisdiction of incorporation, with corporate power and authority
to own its properties and conduct its business as described in the
Prospectus;
(ii) the Company has been duly qualified as a foreign
corporation for the transaction of business and is in good standing
under the laws of each other jurisdiction in which it owns or
leases properties, or conducts any business, so as to require such
qualification, other than where the failure to be so qualified or
in good standing would not have a Material Adverse Effect;
(iii) each of the Company's subsidiaries has been duly
incorporated and is validly existing as a corporation under the
laws of its jurisdiction of incorporation with corporate power and
authority to own its properties and conduct its business as
described in the Prospectus and has been duly qualified as a
foreign corporation for the transaction of business and is in good
standing under the laws of each other jurisdiction in which it owns
or leases properties, or conducts any business, so as to require
such qualification, other than where the failure to be so qualified
and in good standing would not have a Material Adverse Effect; and
all of the outstanding shares of capital stock of each subsidiary
have been duly and validly authorized and issued, are fully paid
and non-assessable, and (except in the case of foreign
subsidiaries, for directors' qualifying shares) are owned directly
or indirectly by the Company, free and clear of all liens,
encumbrances, equities or claims;
12
(iv) other than as set forth or contemplated in the
Prospectus, there are no legal or governmental proceedings pending
or, to such counsel's knowledge, threatened to which the Company or
any of its subsidiaries is or may be a party or to which any
property of the Company or its subsidiaries is or may be the
subject which, if determined adversely to the Company or such
subsidiaries, could individually or in the aggregate reasonably be
expected to have a Material Adverse Effect; to such counsel's
knowledge, no such proceedings are threatened or contemplated by
governmental authorities or threatened by others; and such counsel
does not know of any contracts or other documents of a character
required to be filed as an exhibit to the Registration Statement or
required to be described in the Registration Statement or the
Prospectus that are not filed, referred to or described as
required;
(v) this Agreement has been duly authorized, executed and
delivered by the Company;
(vi) the issue and sale of the Shares and the performance by
the Company of its obligations under this Agreement and the
consummation of the transactions contemplated herein will not
conflict with or result in a breach of any of the terms or
provisions of, or constitute a default under, any indenture,
mortgage, deed of trust, loan agreement or other agreement or
instrument known to such counsel to which the Company or any of its
subsidiaries is a party or by which the Company or any of its
subsidiaries is bound or to which any of the property or assets of
the Company or any of its subsidiaries is subject, except for
conflicts or breaches that individually or in the aggregate could
not reaonable be expected to have a Material Adverse Effect, nor
will any such action result in any violation of the provisions of
the Articles of Incorporation, or the By-Laws of the Company or any
applicable law or statute or any order, rule or regulation of any
court or governmental agency or body having jurisdiction over the
Company, its subsidiaries or any of their respective properties,
except for violations that individually or in the aggregate could
not reasonably be expected to have a Material Adverse Effect;
(vii) no consent, approval, authorization, order, registration
or qualification of or with any court or governmental agency or
body is required for the issue and sale of the Shares or the
consummation of the other transactions contemplated by this
Agreement, except such consents, approvals, authorizations,
registrations or qualifications as have been obtained under the
Securities Act and as may be required under state securities or
Blue Sky laws in connection with the purchase and distribution of
the Shares by the Underwriter;
(viii) the statements in the Prospectus under "Description of
Capital Stock" and "Underwriting" in the Prospectus and in the
13
Registration Statement in Item 15, insofar as such statements
constitute a summary of the legal matters, documents or proceedings
referred to therein, fairly present in all material respects the
information called for with respect to such legal matters,
documents or proceedings; and
(ix) such counsel (A) is of the opinion that each document
incorporated by reference in the Registration Statement and the
Prospectus (except for the financial statements and statistical
data included therein as to which such counsel need express no
opinion) complied as to form in all material respects, when filed
with the Commission, with the Exchange Act; (B) is of the opinion
that the Registration Statement and the Prospectus and any
amendments and supplements thereto (except for the financial
statements and statistical data included therein as to which such
counsel need express no opinion) comply as to form in all material
respects with the requirements of the Securities Act and (C)
believes that (except for the financial statements and statistical
data included therein as to which such counsel need express no
belief) the Registration Statement and the prospectus included
therein at the time the Registration Statement became effective did
not contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to
make the statements therein not misleading, and the Prospectus as
amended or supplemented, if applicable, does not contain any untrue
statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading.
In rendering such opinions, such counsel may rely (A) as to
matters involving the application of laws other than the laws of the
United States and the States of Virginia and New York, to the extent
such counsel deems proper and to the extent specified in such opinion,
if at all, upon an opinion or opinions (reasonably satisfactory to
Underwriters' counsel) of other counsel reasonably acceptable to the
Underwriters' counsel, familiar with the applicable laws; and (B) as to
matters of fact, to the extent such counsel deems proper, on
certificates of responsible officers of the Company and its subsidiaries
and certificates or other written statements of officials of
jurisdictions having custody of documents respecting the corporate
existence or good standing of the Company. The opinion of such counsel
for the Company shall state that the opinion of any such other counsel
is in form satisfactory to such counsel and, in such counsel's opinion,
the Underwriters and they are justified in relying thereon. With
respect to the matters to be covered in subparagraph (ix) above, counsel
may state their opinion and belief is based upon their participation in
the preparation of the Registration Statement and the Prospectus and any
amendment or supplement thereto (other than the documents incorporated
by reference therein) and review and discussion of the contents thereof
(including the documents incorporated by reference therein) but is
without independent check or verification except as specified.
14
(g) Xxxx & Valentine, counsel for the Company, shall have furnished
to the Representatives their written opinion, dated the Closing Date, in
form and substance satisfactory to the Representatives, to the effect
that:
(i) the authorized capital stock of the Company conforms as to
legal matters to the description thereof contained in the
Prospectus;
(ii) the shares of capital stock of the Company outstanding
prior to the issuance of the Shares to be sold by the Company have
been duly authorized and are validly issued, fully paid and
non-assessable;
(iii) the Shares to be issued and sold by the Company hereunder
have been duly authorized, and when delivered to and paid for the
Underwriters in accordance with the terms of this Agreement, will
be validly issued, fully paid and non-assessable and the issuance
of the Shares is not subject to any preemptive or other rights to
subscribe to shares;
(iv) The Rights to be attached to the Shares have been duly
authorized and, when the Shares have been duly and validly issued
in accordance with the terms of this Agreement, will have been
validly issued.
In rendering such opinions, such counsel may rely (A) as to matters
involving the application of laws other than the laws of the United States
and the States of Virginia and New York, to the extent such counsel deems
proper and to the extent specified in such opinion, if at all, upon an
opinion or opinions (reasonably satisfactory to Underwriters' counsel) of
other counsel reasonably acceptable to the Underwriters' counsel, familiar
with the applicable laws; and (B) as to matters of fact, to the extent such
counsel deems proper, on certificates of responsible officers of the
Company and its subsidiaries and certificates or other written statements
of officials of jurisdictions having custody of documents respecting the
corporate existence or good standing of the Company. The opinion of such
counsel for the Company shall state that the opinion of any such other
counsel is in form satisfactory to such counsel and, in such counsel's
opinion, the Underwriters and they are justified in relying thereon.
(h) on the effective date of the Registration Statement and the
effective date of the most recently filed post-effective amendment, if
any, to the Registration Statement and also on the Closing Date and the
Option Closing Date, if any, each of Xxxxxx Xxxxxxxx LLP and Coopers &
Xxxxxxx L.L.P. shall have furnished to the Representatives letters,
dated the respective dates of delivery thereof, in form and substance
satisfactory to the Representatives, containing statements and
information of the type customarily included in accountants "comfort
letters" to underwriters with respect to the financial statements and
15
certain financial information contained in the Registration Statement
and the Prospectus;
(i) the Representatives shall have received on and as of the
Closing Date an opinion of Xxxxx Xxxx & Xxxxxxxx, counsel to the
Underwriters, with respect to the due authority and valid issuance of
the Shares, the Registration Statement, the Prospectus and other related
matters as the Representatives may reasonably request, and such counsel
shall have received such papers and information as they may reasonably
request to enable them to pass upon such matters;
(j) the Shares shall have been approved for quotation by the
Nasdaq National Market, subject to official notice of issuance; and
(k) on or prior to the Closing Date the Company shall have
furnished to the Representatives such further certificates and documents
as the Representatives shall reasonably request.
The several obligations of the Underwriters to purchase Option Shares
hereunder are subject to satisfaction of the conditions set forth in
paragraphs (a) through (k) above on and as of the Additional Closing Date,
except that the certificate called for by paragraph (e) above, the opinions
called for by paragraphs (f), (g) and (i) above and the third letter called
for by paragraph (h) above shall be dated the Additional Closing Date.
7. The Company agrees to indemnify and hold harmless each
Underwriter and each person, if any, who controls any Underwriter within
the meaning of either Section 15 of the Securities Act or Section 20 of the
Exchange Act, from and against any and all losses, claims, damages and
liabilities (including, without limitation the legal fees and other
expenses incurred in connection with any suit, action or proceeding or any
claim asserted) caused by any untrue statement or alleged untrue statement
of a material fact contained in the Registration Statement or the
Prospectus (as amended or supplemented if the Company shall have furnished
any amendments or supplements thereto) or any preliminary prospectus, or
caused by any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein
not misleading, except insofar as such losses, claims, damages or
liabilities are caused by any untrue statement or omission or alleged
untrue statement or omission made in reliance upon and in conformity with
information relating to any Underwriter furnished to the Company in writing
by such Underwriter through the Representatives expressly for use therein;
provided that the foregoing indemnity with respect to any preliminary
prospectus shall not inure to the benefit of any Underwriter (or to the
benefit of any person controlling such Underwriter) from whom the person
asserting any such losses, claims, damages or liabilities purchased Shares
if such untrue statement or omission or alleged untrue statement or
omission made in such preliminary prospectus is eliminated or remedied in
the Prospectus (as amended or supplemented if the Company shall have
furnished any amendments or supplements thereto) and, if required by law, a
copy of the Prospectus (as so amended or supplemented) shall not have been
16
furnished to such person at or prior to the written confirmation of the
sale of such Shares to such person.
Each Underwriter agrees, severally and not jointly, to indemnify
and hold harmless the Company, its directors, its officers who sign the
Registration Statement and each person who controls the Company within the
meaning of Section 15 of the Securities Act and Section 20 of the Exchange
Act, to the same extent as the foregoing indemnity from the Company to each
Underwriter, but only with reference to information relating to such
Underwriter furnished to the Company in writing by such Underwriter through
the Representatives expressly for use in the Registration Statement, the
Prospectus, any amendment or supplement thereto, or any preliminary
prospectus.
If any suit, action, proceeding (including any governmental or
regulatory investigation), claim or demand shall be brought or asserted
against any person in respect of which indemnity may be sought pursuant to
either of the two preceding paragraphs, such person (the "Indemnified
Person") shall promptly notify the person against whom such indemnity may
be sought (the "Indemnifying Person") in writing, and the Indemnifying
Person, upon request of the Indemnified Person, shall retain counsel
reasonably satisfactory to the Indemnified Person to represent the
Indemnified Person and any others the Indemnifying Person may designate in
such proceeding and shall pay the fees and expenses of such counsel related
to such proceeding. In any such proceeding, any Indemnified Person shall
have the right to retain its own counsel, but the fees and expenses of such
counsel shall be at the expense of such Indemnified Person unless (i) the
Indemnifying Person and the Indemnified Person shall have mutually agreed
to the contrary, (ii) the Indemnifying Person has failed within a
reasonable time to retain counsel reasonably satisfactory to the
Indemnified Person or (iii) the named parties in any such proceeding
(including any impleaded parties) include both the Indemnifying Person and
the Indemnified Person and representation of both parties by the same
counsel would be inappropriate due to actual or potential differing
interests between them. It is understood that the Indemnifying Person
shall not, in connection with any proceeding or related proceeding in the
same jurisdiction, be liable for the fees and expenses of more than one
separate firm (in addition to any local counsel) for all Indemnified
Persons, and that all such fees and expenses shall be reimbursed as they
are incurred. Any such separate firm for the Underwriters and such control
persons of Underwriters shall be designated in writing by X.X. Xxxxxx
Securities Inc. and any such separate firm for the Company, its directors,
its officers who sign the Registration Statement and such control persons
of the Company shall be designated in writing by the Company. The
Indemnifying Person shall not be liable for any settlement of any
proceeding effected without its written consent, but if settled with such
consent or if there be a final judgment for the plaintiff, the Indemnifying
Person agrees to indemnify any Indemnified Person from and against any loss
or liability by reason of such settlement or judgment. Notwithstanding the
foregoing sentence, if at any time an Indemnified Person shall have
requested an Indemnifying Person to reimburse the Indemnified Person for
17
fees and expenses of counsel as contemplated by the third sentence of this
paragraph, the Indemnifying Person agrees that it shall be liable for any
settlement of any proceeding effected without its written consent if (i)
such settlement is entered into more than 30 days after receipt by such
Indemnifying Person of the aforesaid request and (ii) such Indemnifying
Person shall not have reimbursed the Indemnified Person in accordance with
such request prior to the date of such settlement. No Indemnifying Person
shall, without the prior written consent of the Indemnified Person, effect
any settlement of any pending or threatened proceeding in respect of which
any Indemnified Person is or could have been a party and indemnity could
have been sought hereunder by such Indemnified Person, unless such
settlement includes an unconditional release of such Indemnified Person
from all liability on claims that are the subject matter of such
proceeding.
If the indemnification provided for in the first and second
paragraphs of this Section 7 is unavailable to an Indemnified Person in
respect of any losses, claims, damages or liabilities referred to therein,
then each Indemnifying Person under such paragraph, in lieu of indemnifying
such Indemnified Person thereunder, shall contribute to the amount paid or
payable by such Indemnified Person as a result of such losses, claims,
damages or liabilities (i) in such proportion as is appropriate to reflect
the relative benefits received by the Company on the one hand and the
Underwriters on the other hand from the offering of the Shares or (ii) if
the allocation provided by clause (i) above is not permitted by applicable
law, in such proportion as is appropriate to reflect not only the relative
benefits referred to in clause (i) above but also the relative fault of the
Company on the one hand and the Underwriters on the other in connection
with the statements or omissions that resulted in such losses, claims,
damages or liabilities, as well as any other relevant equitable
considerations. The relative benefits received by the Company on the one
hand and the Underwriters on the other shall be deemed to be in the same
respective proportions as the net proceeds from the offering of the Shares
(before deducting expenses) received by the Company and the total
underwriting discounts and the commissions received by the Underwriters, in
each case as set forth in the table on the cover of the Prospectus, bear to
the aggregate public offering price of the Shares. The relative fault of
the Company on the one hand and the Underwriters on the other 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 by the Underwriters and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement
or omission.
The Company and the Underwriters agree that it would not be just
and equitable if contribution pursuant to this Section 7 were determined by
pro rata allocation (even if the Underwriters were treated as one entity
for such purpose) or by any other method of allocation that does not take
account of the equitable considerations referred to in the immediately
preceding paragraph. The amount paid or payable by an Indemnified Person
18
as a result of the losses, claims, damages and liabilities referred to in
the immediately preceding paragraph shall be deemed to include, subject to
the limitations set forth above, any legal or other expenses incurred by
such Indemnified Person in connection with investigating or defending any
such action or claim. Notwithstanding the provisions of this Section 7,
in no event shall an Underwriter be required to contribute any amount in
excess of the amount by which the total price at which the Shares
underwritten by it and distributed to the public were offered to the public
exceeds the amount of any damages that such Underwriter has otherwise been
required to pay by reason of such untrue or alleged untrue statement or
omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities
Act) shall be entitled to contribution from any person who was not guilty
of such fraudulent misrepresentation. The Underwriters' obligations to
contribute pursuant to this Section 7 are several in proportion to the
respective number of Shares set forth opposite their names in Schedule I
hereto, and not joint.
The indemnity and contribution agreements contained in this Section
7 are in addition to any liability which the Indemnifying Persons may
otherwise have to the Indemnified Persons referred to above.
The indemnity and contribution agreements contained in this Section
7 and the representations and warranties of the Company set forth in this
Agreement shall remain operative and in full force and effect regardless of
(i) any termination of this Agreement, (ii) any investigation made by or on
behalf of any Underwriter or any person controlling any Underwriter or by
or on behalf of the Company, its officers or directors or any other person
controlling the Company and (iii) acceptance of and payment for any of the
Shares.
8. Notwithstanding anything herein contained, this Agreement (or
the obligations of the several Underwriters with respect to the Option
Shares) may be terminated in the absolute discretion of the
Representatives, by notice given to the Company, if after the execution and
delivery of this Agreement and prior to the Closing Date or, in the case of
the Option Shares, prior to the Additional Closing Date) (i) trading
generally shall have been suspended or materially limited on or by, as the
case may be, any of the New York Stock Exchange or the Nasdaq National
Market, (ii) trading of any securities of or guaranteed by the Company
shall have been suspended on any exchange or in any over-the-counter
market, (iii) a general moratorium on commercial banking activities in New
York shall have been declared by either Federal or New York State
authorities, or (iv) there shall have occurred any outbreak or escalation
of hostilities or any change in financial markets or any calamity or crisis
that, in the judgment of the Representatives, is material and adverse and
which, in the judgment of the Representatives, makes it impracticable to
market the Shares on the terms and in the manner contemplated in the
Prospectus.
19
9. This Agreement shall become effective upon the later of (x)
execution and delivery hereof by the parties hereto and (y) release of
notification of the effectiveness of the Registration Statement (or, if
applicable, any post-effective amendment) by the Commission.
If, on the Closing Date or the Additional Closing Date, as the case
may be, any one or more of the Underwriters shall fail or refuse to
purchase Shares which it or they have agreed to purchase hereunder on such
date, and the aggregate number of Shares which such defaulting Underwriter
or Underwriters agreed but failed or refused to purchase is not more than
one-tenth of the aggregate number of Shares to be purchased on such date,
the other Underwriters shall be obligated severally in the proportions that
the number of Shares set forth opposite their respective names in Schedule
I hereto bears to the aggregate number of Underwritten Shares set forth
opposite the names of all such non-defaulting Underwriters, or in such
other proportions as the Representatives may specify, to purchase the
Shares which such defaulting Underwriter or Underwriters agreed but failed
or refused to purchase on such date; provided that in no event shall the
number of Shares that any Underwriter has agreed to purchase pursuant to
Section 1 be increased pursuant to this Section 9 by an amount in excess of
one-ninth of such number of Shares without the written consent of such
Underwriter. If, on the Closing Date or the Additional Closing Date, as
the case may be, any Underwriter or Underwriters shall fail or refuse to
purchase Shares which it or they have agreed to purchase hereunder on such
date, and the number of Shares with respect to which such default occurs is
more than one-tenth of the aggregate number of Shares to be purchased on
such date, and arrangements satisfactory to the Representatives and the
Company for the purchase of such Shares are not made within 36 hours after
such default, this Agreement (or the obligations of the several
Underwriters to purchase the Option Shares, as the case may be) shall
terminate without liability on the part of any non-defaulting Underwriter
or the Company. In any such case either the Representatives or the Company
shall have the right to postpone the Closing Date (or, in the case of the
Option Shares, the Additional Closing Date), but in no event for longer
than seven days, in order that the required changes, if any, in the
Registration Statement and in the Prospectus or in any other documents or
arrangements may be effected. Any action taken under this paragraph shall
not relieve any defaulting Underwriter from liability in respect of any
default of such Underwriter under this Agreement.
10. If this Agreement shall be terminated by the Underwriters, or
any of them, because of any failure or refusal on the part of the Company
to comply with the terms or to fulfill any of the conditions of this
Agreement, or if for any reason the Company shall be unable to perform its
obligations under this Agreement, the Company agrees to reimburse the
Underwriters or such Underwriters as have so terminated this Agreement with
respect to themselves, severally, for all out-of-pocket expenses (including
the fees and expenses of their counsel) reasonably incurred by the
Underwriters in connection with this Agreement or the offering contemplated
hereunder.
20
11. This Agreement shall inure to the benefit of and be binding
upon the Company, the Underwriters, any controlling persons referred to
herein and their respective successors, assigns, heirs and legal
representatives. Nothing expressed or mentioned in this Agreement is
intended or shall be construed to give any other person, firm or
corporation any legal or equitable right, remedy or claim under or in
respect of this Agreement or any provision herein contained. No purchaser
of Shares from any Underwriter shall be deemed to be a successor by reason
merely of such purchase.
12. Any action by the Underwriters hereunder may be taken by the
Representatives jointly or by X.X. Xxxxxx Securities Inc. alone on behalf
of the Underwriters, and any such action taken by the Representatives
jointly or by X.X. Xxxxxx Securities alone shall be binding upon the
Underwriters. All notices and other communications hereunder shall be in
writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the
Underwriters shall be given to the Representatives c/o X.X. Xxxxxx
Securities Inc., 00 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention:
Syndicate Department. Notices to the Company shall be given to it at
Cadmus Communications Corporation, 0000 Xxxx Xxxxx Xxxxxx, Xxxxx 000,
Xxxxxxxx, Xxxxxxxx 00000, Attention: Xxxxx X. Xxxxxx.
13. This Agreement may be signed in counterparts, each of which
shall be an original and all of which together shall constitute one and the
same instrument. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York, without giving effect to
the conflicts of laws provisions thereof.
If the foregoing is in accordance with your understanding, please
sign and return four counterparts hereof.
Very truly yours,
CADMUS COMMUNICATIONS
CORPORATION
By:_________________________
Title:
21
Accepted: _______________, 1995
X.X. Xxxxxx Securities Inc.
Interstate/Xxxxxxx Lane Corporation
Acting severally on behalf of them-
selves and the several Underwriters
listed in Schedule I hereto.
By: X.X. Xxxxxx Securities Inc.
Acting on behalf of itself and the
several Underwriters listed in
Schedule I hereto.
By:________________________
Title:
22
SCHEDULE I
Number of Shares
Underwriter To Be Purchased
X.X. Xxxxxx Securities Inc. . . . . . .
Interstate/Xxxxxxx Xxxx Corporation . .
________________
Total: . . . . . . . . . 1,500,000
23
ANNEX A
[List of Material Subsidiaries]
24
