EXHIBIT B
3,692,000 Shares of Common Stock
QUANTA SERVICES, INC.
UNDERWRITING AGREEMENT
December 9, 2004
X.X. XXXXXX SECURITIES INC.
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies/Gentlemen:
The selling stockholder, First Reserve Fund IX, L.P. (the "Selling
Stockholder"), proposes, subject to the terms and conditions stated herein, to
sell to X.X. Xxxxxx Securities Inc. (the "Underwriter") an aggregate of
3,692,000 shares (the "Shares") of common stock, par value $0.00001 per share
(the "Common Stock"), of Quanta Services, Inc., a corporation organized and
existing under the laws of Delaware (the "Company"). The Shares are more fully
described in the Registration Statement and Prospectus referred to below.
1. Representations and Warranties of the Company. The Company
represents and warrants to, and agrees with, the Underwriter that:
(a) The Company has filed with the Securities and Exchange
Commission (the "Commission") a registration statement on Form S-3 (No.
333-114938), and amendments thereto, and related preliminary prospectuses for
the registration under the Securities Act of 1933, as amended (the "Securities
Act"), of the Shares and the offering thereof from time to time in accordance
with Rule 415 of the rules and regulations of the Commission under the
Securities Act (the "Securities Act Regulations"). Such registration statement
has been declared effective by the Commission, and the Company has filed such
post-effective amendments thereto (or such preliminary prospectus or preliminary
supplemental prospectus) as may be required under the Securities Act and the
Securities Act Regulations, and each such post-effective amendment has been
declared effective by the Commission and copies of which have heretofore been
delivered to the Underwriter. The registration statement, as amended at the time
it became effective, including the prospectus, financial statements, schedules,
an exhibits and information (if any) deemed to be part of the registration
statement at the time of effectiveness pursuant to Rule 434(d) under the
Securities Act, is hereinafter referred to as the "Registration Statement." If
the Company has filed or is required pursuant to the terms hereof to file a
registration statement pursuant to Rule 462(b) under the Securities Act
registering additional shares of Common Stock (a "Rule 462(b) Registration
Statement"), then, unless otherwise specified, any reference herein to the term
"Registration Statement" shall be deemed to include such Rule 462(b)
Registration Statement. Other than a Rule 462(b) Registration Statement, which,
if filed, becomes effective upon filing, no other document with respect to the
Registration
Statement has heretofore been filed with the Commission other than any
applicable prospectus supplements filed pursuant to Rule 424(b)(3). All of the
Shares have been registered under the Securities Act pursuant to the
Registration Statement or, if any Rule 462(b) Registration Statement is filed,
will be duly registered under the Securities Act with the filing of such Rule
462(b) Registration Statement. No stop order suspending the effectiveness of
either the Registration Statement or the Rule 462(b) Registration Statement, if
any, has been issued and no proceeding for that purpose has been initiated or
overtly threatened by the Commission. The Company, if required by the Securities
Act and the rules and regulations of the Commission (the "Rules and
Regulations"), proposes to file the Prospectus (as defined below) with the
Commission pursuant to Rule 424(b) under the Securities Act ("Rule 424(b)"). The
prospectus, in the form in which it is to be filed with the Commission pursuant
to Rule 424(b), or, if the prospectus is not to be filed with the Commission
pursuant to Rule 424(b), the prospectus in the form included as part of the
Registration Statement at the time the Registration Statement became effective,
is hereinafter referred to as the "Prospectus," except that if any revised
prospectus or prospectus supplement shall be provided to the Underwriter by the
Company for use in connection with the offering and sale of the Shares
contemplated herein (the "Offering") which differs from the Prospectus (whether
or not such revised prospectus or prospectus supplement is required to be filed
by the Company pursuant to Rule 424(b)), the term "Prospectus" shall also refer
to such revised prospectus or prospectus supplement, as the case may be, from
and after the time it is first provided to the Underwriter for such use. Any
preliminary prospectus or prospectus subject to completion included in the
Registration Statement or filed with the Commission pursuant to Rule 424 under
the Securities Act is hereafter called a "Preliminary Prospectus." Any reference
herein 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 which were filed under the
Exchange Act (as defined below) on or before the effective date of the
Registration Statement, the date of such Preliminary Prospectus or the date of
the Prospectus, as the case may be, and any reference herein to the terms
"amend," "amendment" or "supplement" with respect to the Registration Statement,
any Preliminary Prospectus or the Prospectus shall be deemed to refer to and
include (i) the filing of any document under the Exchange Act after the
effective date of the Registration Statement, the date of such Preliminary
Prospectus or the date of the Prospectus, as the case may be, which is
incorporated therein by reference and (ii) any such document so filed. All
references in this Agreement to the Registration Statement, the Rule 462(b)
Registration Statement, a Preliminary Prospectus and the Prospectus, or any
amendments or supplements to any of the foregoing shall be deemed to include any
copy thereof filed with the Commission pursuant to its Electronic Data
Gathering, Analysis and Retrieval System ("XXXXX").
(b) At the time of the effectiveness of the Registration
Statement or any Rule 462(b) Registration Statement or the effectiveness of any
post-effective amendment to the Registration Statement, when the Prospectus is
first filed with the Commission pursuant to Rule 424(b) or Rule 434 under the
Securities Act ("Rule 434"), when any supplement to or amendment of the
Prospectus is filed with the Commission, when any document filed under the
Exchange Act was or is filed and at the Closing Date (as hereinafter defined),
the Registration Statement and the Prospectus and any amendments thereof and
supplements thereto complied or will comply in all material respects with the
applicable provisions of the Securities Act, the Exchange Act and the Rules and
Regulations and did not and will not contain an untrue
2
statement of a material fact and did not and will not omit to state any material
fact required to be stated therein or necessary in order to make the statements
therein (i) in the case of the Registration Statement, not misleading and (ii)
in the case of the Prospectus or any related Preliminary Prospectus in light of
the circumstances under which they were made, not misleading. When any
Preliminary Prospectus was first filed with the Commission (whether filed as
part of the registration statement for the registration of the Shares or any
amendment thereto or pursuant to Rule 424(a) under the Securities Act) and when
any amendment thereof or supplement thereto was first filed with the Commission,
such Preliminary Prospectus and any amendments thereof and supplements thereto
complied in all material respects with the applicable provisions of the
Securities Act, the Exchange Act and the Rules and Regulations and did not
contain an untrue statement of a material fact and did not omit to state any
material fact required to be stated therein or necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading. No representation and warranty is made in this subsection (b),
however, with respect to any information contained in or omitted from the
Registration Statement or the Prospectus or any related Preliminary Prospectus
or any amendment thereof or supplement thereto in reliance upon and in
conformity with information furnished in writing to the Company by Underwriter
specifically for use therein. The parties acknowledge and agree that such
information provided by the Underwriter consists solely of the material included
in paragraphs 4 and 8 under the caption "Underwriting" in the Prospectus.
(c) PricewaterhouseCoopers LLP, who have expressed their
opinion with respect to certain of the financial statements and supporting
schedules and information of the Company and its subsidiaries that are included
or incorporated by reference in the Registration Statement, are independent
public accountants as required by the Securities Act, Securities Exchange Act of
1934, as amended (the "Exchange Act") and the Rules and Regulations.
(d) Subsequent to the respective dates as of which information
is given in the Registration Statement and the Prospectus, except as disclosed
in the Registration Statement and the Prospectus and in any amendments thereof
and supplements thereto filed with the Commission, the Company has not declared,
paid or made any dividends or other distributions of any kind on or in respect
of its capital stock and there has been no material adverse change, or any
development that would reasonably be expected to result in a material adverse
change, whether or not arising from transactions in the ordinary course of
business, in (i) the business, condition (financial or otherwise), results of
operations, stockholders' equity, properties or prospects of the Company and
each subsidiary of the Company listed on Schedule I hereto (the "Subsidiaries"),
taken as a whole; or (ii) the long-term debt or capital stock of the Company or
any of its Subsidiaries (a "Material Adverse Change"). Since the date of the
latest balance sheet presented, or incorporated by reference, in the
Registration Statement and the Prospectus, neither the Company nor any
Subsidiary has incurred or undertaken any liabilities or obligations, whether
direct or indirect, liquidated or contingent, matured or unmatured, or entered
into any transactions not in the ordinary course of business, including any
acquisition or disposition of any business or asset, which are material to the
Company and the Subsidiaries taken as a whole, except for liabilities,
obligations and transactions which are disclosed in the Registration Statement
and the Prospectus and in any amendments thereof and supplements thereto filed
with the Commission.
3
(e) As of December 9, 2004, the authorized, issued and
outstanding capital stock of the Company was as set forth in the Prospectus
under the caption "Description of Capital Stock." All of the issued and
outstanding shares of capital stock of the Company are fully paid and
non-assessable and have been duly and validly authorized and issued, in
compliance with all applicable state, federal and foreign securities laws and
not in violation of or subject to any preemptive or similar right that does or
will entitle any person, upon the issuance or sale of any security, to acquire
from the Company or any Subsidiary any Common Stock or other security of the
Company or any Subsidiary or any security convertible into, or exercisable or
exchangeable for, Common Stock or any other such security (any "Relevant
Security"), except for such rights as may have been fully satisfied or waived
prior to the effectiveness of the Registration Statement. The Shares to be
delivered on the Closing Date (as hereinafter defined), have been duly and
validly authorized, are duly and validly issued, fully paid and non-assessable,
have been issued in compliance with all applicable state, federal and foreign
securities laws and have not been issued in violation of or subject to any
preemptive or similar right that does or will entitle any person to acquire any
Relevant Security from the Company or any Subsidiary upon issuance or sale of
Shares in the Offering. The Common Stock and the Shares conform to the
descriptions thereof contained or incorporated by reference in the Registration
Statement and the Prospectus. Except as disclosed in the Registration Statement
and the Prospectus, neither the Company nor any Subsidiary has outstanding
warrants, options to purchase, or any preemptive rights or other rights to
subscribe for or to purchase, or any contracts or commitments to issue or sell,
any Relevant Security.
(f) The Subsidiaries are the only subsidiaries of the Company
within the meaning of Rule 405 under the Securities Act. Except for the
Subsidiaries, as otherwise disclosed in the Registration Statement and the
Prospectus and for the Company's ownership interest in each of Lightwave LLC and
Pivotel, LLC, the Company holds no ownership or other interest, nominal or
beneficial, direct or indirect, in any corporation, partnership, joint venture
or other business entity. All of the issued shares of capital stock of or other
ownership interests in each Subsidiary have been duly and validly authorized and
issued and are fully paid and non-assessable and are owned directly or
indirectly by the Company free and clear of any lien, charge, mortgage, pledge,
security interest, claim, equity, trust or other encumbrance, or preferential
arrangement of any kind whatsoever (a "Lien"), except to the extent that the
capital stock of each of the Subsidiaries is pledged as security to the lenders
under the Credit Agreement dated as of December 19, 2003 (as amended through the
date of this Agreement) between the Company and the lenders and other parties as
set forth therein.
(g) Each of the Company and the Subsidiaries has been duly
organized and validly exists as a corporation, partnership or limited liability
company in good standing under the laws of its jurisdiction of organization.
Each of the Company and the Subsidiaries is duly qualified to do business and is
in good standing as a foreign corporation, partnership or limited liability
company in each jurisdiction in which such qualification is required by law,
other than those jurisdictions as to which the failure to be so qualified or in
good standing could not, individually or in the aggregate, reasonably be
expected to have a material adverse effect on (i) the business, condition
(financial or otherwise), results of operations, stockholders' equity,
properties or prospects of the Company and the Subsidiaries, taken as a whole;
(ii) the long-term debt or capital stock of the Company or any of its
Subsidiaries; or (iii) the Offering or consummation of any of the other
transactions contemplated by this Agreement, the Registration
4
Statement or the Prospectus (a "Material Adverse Effect"). Each of the Company
and the Subsidiaries has (i) all requisite corporate, limited liability or
limited partnership power and authority, and (ii) all consents, approvals,
authorizations, orders, registrations, qualifications, licenses, filings and
permits of, with and from all judicial, regulatory and other legal or
governmental agencies and bodies and all third parties, foreign and domestic
(collectively, the "Consents"), that are necessary to own, lease and operate its
properties and conduct its business as it is now being conducted and as
disclosed in the Registration Statement and the Prospectus except, in the case
of clause (ii), for any Consents the absence of which would not reasonably be
expected to have a Material Adverse Effect. Each such Consent is valid and in
full force and effect, and neither the Company nor any Subsidiary has received
written notice of any investigation or proceedings which has resulted in or, if
decided adversely to the Company or any Subsidiary, could reasonably be expected
to result in, the revocation of, or imposition of a materially burdensome
restriction on, any such Consent. Each of the Company and the Subsidiaries is in
compliance with all applicable laws, rules, regulations, ordinances, directives,
judgments, decrees and orders, foreign and domestic, except where failure to be
in compliance could not reasonably be expected to have a Material Adverse
Effect.
(h) The Company has full right, power and authority to execute
and deliver this Agreement, to perform its obligations hereunder and to
consummate the transactions contemplated by this Agreement, the Registration
Statement and the Prospectus. This Agreement and the transactions contemplated
by this Agreement, the Registration Statement and the Prospectus have been duly
and validly authorized by the Company. This Agreement has been duly and validly
executed and delivered by the Company.
(i) The execution, delivery, and performance of this Agreement
and consummation of the transactions contemplated by this Agreement, the
Registration Statement and the Prospectus do not and will not (i) conflict with,
require consent under or result in a breach of any of the terms and provisions
of, or constitute a default (or an event which with notice or lapse of time, or
both, would constitute a default) under, or result in the creation or imposition
of any Lien upon any property or assets of the Company or any Subsidiary
pursuant to, any indenture, mortgage, deed of trust, loan agreement or other
agreement, instrument, franchise, license or permit to which the Company or any
Subsidiary is a party or by which the Company or any Subsidiary or their
respective properties, operations or assets may be bound; (ii) violate or
conflict with any provision of the certificate or articles of incorporation,
by-laws, certificate of formation, limited liability company agreement,
partnership agreement or other organizational documents of the Company or any
Subsidiary; or (iii) violate or conflict with any law, rule, regulation,
ordinance, directive, judgment, decree or order of any judicial, regulatory or
other legal or governmental agency or body, domestic or foreign, except (in the
case of clauses (i) and (iii) above) as could not reasonably be expected to have
a Material Adverse Effect.
(j) No Consent of, with or from any judicial, regulatory or
other legal or governmental agency or body or any third party, foreign or
domestic, is required for the execution, delivery and performance of this
Agreement or consummation of the transactions contemplated by this Agreement,
the Registration Statement and the Prospectus, including the sale and delivery
of the Shares to be sold and delivered hereunder, except the registration under
the Securities Act of the Shares, which has become effective, and such Consents
as may be
5
required under state or foreign securities or blue sky laws or the by-laws and
rules of the National Association of Securities Dealers, Inc. (the "NASD") or
NASD Regulation, Inc. ("NASDR") in connection with the purchase and distribution
of the Shares by the Underwriter, each of which has been obtained and is in full
force and effect.
(k) Except as disclosed in the Registration Statement and the
Prospectus and in any amendments thereof and supplements thereto filed with the
Commission, there is no judicial, regulatory, arbitral or other legal or
governmental proceeding or other litigation or arbitration, domestic or foreign,
pending to which the Company or any Subsidiary is a party or of which any
property, operations or assets of the Company or any Subsidiary is the subject
which, individually or in the aggregate, (A) has a reasonable probability of
being determined adversely to the Company or any Subsidiary and (B) if
determined adversely to the Company or any Subsidiary, could reasonably be
expected to have a Material Adverse Effect; to the Company's knowledge, no such
proceeding, litigation or arbitration is threatened.
(l) The financial statements, including the notes thereto, and
the supporting schedules included or incorporated by reference in the
Registration Statement and the Prospectus present fairly in all material
respects the financial position as of the dates indicated and the cash flows and
results of operations for the periods specified of the Company and its
consolidated subsidiaries included or incorporated by reference in the
Registration Statement and the Prospectus; except as otherwise stated in the
Registration Statement and the Prospectus, said financial statements have been
prepared in conformity with United States generally accepted accounting
principles applied on a consistent basis throughout the periods involved; and
the supporting schedules included in the Registration Statement and the
Prospectus present fairly in all material respects the information required to
be stated therein.
(m) There are no pro forma financial statements which are
required to be included or incorporated by reference in the Registration
Statement and Prospectus in accordance with Regulation S-X which have not been
included as so required.
(n) The Company is subject to the reporting requirements of
Section 13 or 15(d) of the Exchange Act and files reports with the Commission on
XXXXX. The Common Stock is registered pursuant to Section 12(b) of the Exchange
Act and the outstanding shares of Common Stock (including the Shares) are listed
on the NYSE (as defined in Section 13(b) below) and the Company has taken no
action designed to, or likely to have the effect of, terminating the
registration of the Common Stock under the Exchange Act or de-listing the Common
Stock from the NYSE, nor has the Company received any notification that the
Commission or the NYSE is contemplating terminating such registration or
listing.
(o) The Company and its Subsidiaries maintain a system of
internal accounting and other controls sufficient to provide reasonable
assurances that (i) transactions are executed in accordance with management's
general or specific authorizations, (ii) transactions are recorded as necessary
to permit preparation of financial statements in conformity with United States
generally accepted accounting principles and to maintain accountability for
assets, (iii) access to assets is permitted only in accordance with management's
general or specific authorization, and (iv) the recorded accounting for assets
is compared with existing assets at reasonable intervals and appropriate action
is taken with respect to any differences.
6
(p) Neither the Company nor any of its affiliates that is
directly or indirectly controlled by the Company (each, a "Controlled
Affiliate") has taken, directly or indirectly, any action which constitutes or
is designed to cause or result in, or which could reasonably be expected to
constitute, cause or result in, the stabilization or manipulation of the price
of any security to facilitate the sale or resale of the Shares.
(q) Neither the Company nor any of its Controlled Affiliates
has, prior to the date hereof, made any offer or sale of any securities which
could be "integrated" for purposes of the Securities Act or the Rules and
Regulations with the offer and sale of the Shares pursuant to the Registration
Statement.
(r) Except as disclosed in the Registration Statement and the
Prospectus, no holder of any Relevant Security has any rights to require
registration of any Relevant Security as part or on account of, or otherwise in
connection with, the offer and sale of the Shares contemplated hereby, and any
such rights so disclosed have either been fully complied with by the Company or
effectively waived by the holders thereof, and any such waivers remain in full
force and effect.
(s) The conditions for use of Form S-3 to register the
Offering under the Securities Act, as set forth in the General Instructions to
such Form, have been satisfied.
(t) The documents incorporated or deemed to be incorporated by
reference in the Prospectus, at the time they were or hereafter are filed with
the Commission, complied and will comply in all material respects with the
requirements of the Securities Act, the Exchange Act and the Rules and
Regulations, and, when read together with the other information in the
Prospectus, do 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.
(u) The Company is not and, at all times up to and including
consummation of the transactions contemplated by this Agreement, the
Registration Statement and the Prospectus, will not be, subject to registration
as an "investment company" under the Investment Company Act of 1940, as amended,
and is not and will not be an entity "controlled" by an "investment company"
within the meaning of such act.
(v) Neither the Company nor any Subsidiary is a "holding
company," or a "subsidiary company" of a "holding company," or an "affiliate" of
a "holding company" within the meaning of the Public Utility Holding Company Act
of 1935, as amended.
(w) There are no contracts or other documents (including,
without limitation, any voting agreement), which are required to be described in
the Registration Statement and the Prospectus or filed as exhibits to the
Registration Statement by the Securities Act, the Exchange Act or the Rules and
Regulations and which have not been so described or filed.
(x) No relationship, direct or indirect, exists between or
among any of the Company or any affiliate of the Company, on the one hand, and
any director, officer, stockholder, customer or supplier of the Company or any
affiliate of the Company, on the other hand, which is required by the Securities
Act, the Exchange Act or the Rules and Regulations to
7
be described in the Registration Statement or the Prospectus which is not so
described as required. There are no outstanding loans, advances (except normal
advances for business expenses in the ordinary course of business) or guarantees
of indebtedness by the Company to or for the benefit of any of the officers or
directors of the Company or any of their respective family members, except as
disclosed in the Registration Statement and the Prospectus. The Company has not,
in violation of the Xxxxxxxx-Xxxxx Act, directly or indirectly, including
through a Subsidiary, extended or maintained credit, arranged for the extension
of credit, or renewed an extension of credit, in the form of a personal loan to
or for any director or executive officer of the Company.
(y) Except as disclosed in the Registration Statement and the
Prospectus, there are no contracts, agreements or understandings between the
Company and any person that would give rise to a valid claim against the Company
or the Underwriter for a brokerage commission, finder's fee or other like
payment in connection with the transactions contemplated by this Agreement, the
Registration Statement and the Prospectus or, to the Company's knowledge, any
arrangements, agreements, understandings, payments or issuance with respect to
the Company or any of its officers, directors, stockholders, partners,
employees, Subsidiaries or affiliates that may affect the Underwriter's
compensation as determined by the NASD.
(z) The Company and each Subsidiary owns or leases all such
properties as are necessary to the conduct of its business as presently
operated. The Company and the Subsidiaries have good title in fee simple to all
real property and good title to all personal property owned by them, in each
case free and clear of all Liens (i) except such as are described in the
Registration Statement and the Prospectus, (ii) except that all such real and
personal property is subject to mortgages and liens granted as security to the
lenders under the Credit Agreement dated as of December 19, 2003 (as amended
through the date of this Agreement) between the Company and the lenders and
other parties as set forth therein and (iii) except such as do not (individually
or in the aggregate) materially affect the value of such property or interfere
with the use made or proposed to be made of such property by the Company and the
Subsidiaries; and any real property and buildings held under lease or sublease
by the Company and the Subsidiaries are held by them under valid, subsisting and
enforceable leases with such exceptions as are not material to, and do not
interfere with, the use made and proposed to be made of such property and
buildings by the Company and the Subsidiaries. Neither the Company nor any
Subsidiary has received any written notice of any claim adverse to its ownership
of any real or personal property or of any claim against the continued
possession of any real property, whether owned or held under lease or sublease
by the Company or any Subsidiary, except as could not reasonably be expected to
have a Material Adverse Effect.
(aa) The Company and each Subsidiary owns or possesses
adequate right to use all patents, patent applications, trademarks, service
marks, trade names, trademark registrations, service xxxx registrations,
copyrights, licenses, formulae, customer lists, and know-how and other
intellectual property (including trade secrets and other unpatented and/or
unpatentable proprietary or confidential information, systems or procedures,
"Intellectual Property") necessary for the conduct of their respective
businesses as being conducted, except as could not reasonably be expected to
have a Material Adverse Effect. Neither the Company nor any of its Subsidiaries
has received any notice of infringement or conflict with asserted Intellectual
Property rights of others, any notice that any of the technology employed by the
8
Company has been obtained or is being used by the Company in violation of any
contractual obligation binding on the Company or, to the Company's knowledge,
any contractual obligation binding on any of its officers, directors or
employees or otherwise in violation of the rights of any person, and which such
infringement, conflict or violation, if the subject of an unfavorable decision,
would reasonably be expected to have a Material Adverse Effect.
(bb) Except as disclosed in the Registration Statement and the
Prospectus, the Company and the Subsidiaries maintain insurance or are self
insured with sufficient reserves in such amounts and covering such risks as the
Company reasonably considers adequate for the conduct of its business and the
value of its properties and as is customary for companies engaged in similar
businesses in similar industries, all of which insurance is in full force and
effect, except where the failure to maintain such insurance could not reasonably
be expected to have a Material Adverse Effect. There are no material claims by
the Company or any Subsidiary under any such policy or instrument as to which
any insurance company is denying liability or defending under a reservation of
rights clause. The Company reasonably believes that it will be able to renew its
existing insurance as and when such coverage expires or will be able to obtain
replacement insurance adequate for the conduct of the business and the value of
its properties at a cost that would not have a Material Adverse Effect.
(cc) Subject to applicable deductibles and customary
limitations and exceptions, the Company has in effect insurance covering the
Company and its directors and officers for liabilities or losses arising in
connection with this Offering, including, without limitation, liabilities or
losses arising under the Securities Act, the Exchange Act and the Rules and
Regulations.
(dd) Each of the Company and the Subsidiaries has, in all
material respects, accurately prepared and timely filed all federal, state,
foreign and other tax returns that are required to be filed by it and has paid
or made provision for the payment of all taxes, assessments, governmental or
other similar charges, including without limitation, all sales and use taxes and
all taxes which the Company or any Subsidiary is obligated to withhold from
amounts owing to employees, creditors and third parties, with respect to the
periods covered by such tax returns (whether or not such amounts are shown as
due on any tax return). No deficiency assessment with respect to a proposed
adjustment of the Company's or any Subsidiary' federal, state, local or foreign
taxes is pending or, to the Company's knowledge, threatened, except as could not
reasonably be expected to result in a Material Adverse Effect. The accruals and
reserves on the books and records of the Company and the Subsidiaries in respect
of tax liabilities for any taxable period not finally determined are adequate to
meet any assessments and related liabilities for any such period and, since the
date of most recent audited financial statements, the Company and the
Subsidiaries have not incurred any liability for taxes other than in the
ordinary course of its business. There is no tax lien, whether imposed by any
federal, state, foreign or other taxing authority, outstanding against the
assets, properties or business of the Company or any Subsidiary, except as could
not reasonably be expected to result in a Material Adverse Effect.
(ee) No labor disturbance by the employees of the Company or
any Subsidiary exists or, to the Company's knowledge, is imminent which,
(individually or in the aggregate), could reasonably be expected to have a
Material Adverse Effect.
9
(ff) No "prohibited transaction" (as defined in either Section
406 of the Employee Retirement Income Security Act of 1974, as amended,
including the regulations and published interpretations thereunder ("ERISA") or
Section 4975 of the Internal Revenue Code of 1986, as amended from time to time
(the "Code")), "accumulated funding deficiency" (as defined in Section 302 of
ERISA) or other event of the kind described in Section 4043(b) of ERISA (other
than events with respect to which the 30-day notice requirement under Section
4043 of ERISA has been waived) has occurred with respect to any employee benefit
plan for which the Company or any Subsidiary would have any liability which
could (individually or in the aggregate) reasonably be expected to have a
Material Adverse Effect; each employee benefit plan for which the Company or any
Subsidiary would have any liability is in compliance in all material respects
with applicable law, including (without limitation) ERISA and the Code; the
Company has not incurred and does not expect to incur liability under Title IV
of ERISA with respect to the termination of, or withdrawal from any "pension
plan;" and each plan for which the Company would have any liability that is
intended to be qualified under Section 401(a) of the Code is so qualified and
nothing has occurred, whether by action or by failure to act, which could cause
the loss of such qualification.
(gg) There has been no storage, generation, transportation,
handling, treatment, disposal, discharge, emission or other release of any kind
of toxic or other wastes or other hazardous substances by, due to, or caused by
the Company or any Subsidiary (or, to the Company's knowledge, any other entity
for whose acts or omissions the Company is or may be liable) upon any property
now or previously owned or leased by the Company or any Subsidiary, or upon any
other property, which would be a violation of or give rise to any liability
under any applicable law, rule, regulation, order, judgment, decree or permit
relating to pollution or protection of human health and the environment
("Environmental Law"), except for violations and liabilities which, individually
or in the aggregate, could not reasonably be expected to have a Material Adverse
Effect. There has been no disposal, discharge, emission or other release of any
kind onto such property or into the environment surrounding such property of any
toxic or other wastes or other hazardous substances with respect to which the
Company or any Subsidiary has knowledge, except as could not, individually or in
the aggregate, reasonably be expected to have a Material Adverse Effect. Neither
the Company nor any Subsidiary has agreed to assume, undertake or provide
indemnification for any liability of any other person under any Environmental
Law, including any obligation for cleanup or remedial action, except as could
not, individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect. There is no pending or, to the best of the Company's knowledge,
threatened administrative, regulatory or judicial action, claim or notice of
noncompliance or violation, investigation or proceedings relating to any
Environmental Law against the Company or any Subsidiary.
(hh) Neither the Company, any Subsidiary nor, to the Company's
knowledge, any of its employees or any agent acting within the scope of such
agent's authority has at any time during the last five years (i) made any
unlawful contribution to any candidate for foreign office, or failed to disclose
fully any contribution in violation of law, or (ii) made any payment to any
federal or state governmental officer or official, or other person charged with
similar public or quasi-public duties, other than payments required or permitted
by the laws of the United States of any jurisdiction thereof.
10
(ii) Neither the Company nor any Subsidiary (i) is in
violation of its certificate or articles of incorporation, by-laws, certificate
of formation, limited liability company agreement, partnership agreement or
other organizational documents, (ii) is in default under, and no event has
occurred which, with notice or lapse of time or both, would constitute a default
under or result in the creation or imposition of any lien, charge or encumbrance
upon any property or assets of the Company or any of its subsidiaries pursuant
to, any indenture, mortgage, deed of trust, loan agreement or other agreement or
instrument to which it is a party or by which it is bound or to which any of its
property or assets is subject or (iii) is in violation in any respect of any
law, rule, regulation, ordinance, directive, judgment, decree or order of any
judicial, regulatory or other legal or governmental agency or body, foreign or
domestic, except (in the case clauses (ii) and (iii) above) violations or
defaults that could not (individually or in the aggregate) reasonably be
expected to have a Material Adverse Effect and except (in the case of clause
(ii) alone) for any lien, charge or encumbrance disclosed in the Registration
Statement and the Prospectus.
(jj) The Company is in compliance with applicable provisions
of the Sarbanes Oxley Act that are effective, except where failure to be in
compliance would not reasonably be expected to have a Material Adverse Effect.
Any certificate signed by or on behalf of the Company and
delivered to the Underwriter or to counsel for the Underwriter shall be deemed
to be a representation and warranty by the Company to the Underwriter as to the
matters covered thereby.
2. Representations and Warranties of the Selling Stockholder. The
Selling Stockholder represents and warrants to, and agrees with, the Underwriter
as of the date hereof and as of the Closing Date that:
(a) This Agreement has been duly authorized, executed and
delivered by the Selling Stockholder. The Selling Stockholder has full legal
capacity, right and authority to sell, transfer and deliver in the manner
provided in this Agreement the Shares being sold by such Selling Stockholder
hereunder.
(b) Such Selling Stockholder has good and valid title to the
Shares to be sold by such Selling Stockholder hereto, free and clear of all
security interests, liens, encumbrances, equities or other claims, and, upon
delivery of and payment for such Shares, the Selling Stockholder will deliver to
the Underwriter good and valid title to such Shares, free and clear of all
security interests, liens, encumbrances, equities or other claims.
(c) No consent, approval, authorization, and no order,
registration or qualification of, or filing with, any third party (whether
acting in an individual, fiduciary or other capacity) or any court or
governmental agency or body is required for the consummation by such Selling
Stockholder of the transactions contemplated herein, except such as may have
been obtained under the Securities Act and such as may be required under the
blue sky laws of any jurisdiction in connection with the purchase and
distribution of the Shares by the Underwriter and such other approvals as have
been obtained.
11
(d) Neither the sale of the Shares being sold by such Selling
Stockholder nor the consummation of any other of the transactions herein
contemplated by such Selling Stockholder or the fulfillment of the terms hereof
by such Selling Stockholder will conflict with, result in a breach or violation
of, or constitute a default under any law or the charter, by-laws or other
organizational documents of such Selling Stockholder or the terms of any
indenture or other agreement or instrument to which such Selling Stockholder or
any of its subsidiaries is a party or by which such Selling Stockholder or any
of its subsidiaries is bound, or any statute, rule, regulation, judgment, order
or decree applicable to such Selling Stockholder or any of its subsidiaries of
any court, regulatory body, administrative agency, governmental body or
arbitrator having jurisdiction over such Selling Stockholder or any of its
subsidiaries.
(e) Except as disclosed in the Prospectus, there are no
contracts, agreements or understandings between the Selling Stockholder and any
person that would give rise to a valid claim against the Selling Stockholder or
the Underwriter for a brokerage commission, finder's fee or other like payment
in connection with the transactions contemplated by this Agreement.
(f) Subject to the last sentence of this Section 2(f), at the
respective times that the Registration Statement and any post-effective
amendments thereto became effective and at the Closing Date the Registration
Statement and any amendments and supplements thereto did not and will not
contain an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading. Subject to the last sentence of this Section 2(f), neither the
Prospectus nor any amendment or supplement thereto, at the time the Prospectus
or any amendment or supplement thereto was issued and at the Closing Date
included or will include an untrue statement of a material fact or omitted or
will omit to state a material fact necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading. The representations and warranties in this subsection shall only
apply to statements in or omissions from the Registration Statement or the
Prospectus made in reliance upon and in conformity with information furnished to
the Company in writing by the Selling Stockholder expressly for use in the
Registration Statement or the Prospectus, which the parties acknowledge that the
information set forth under the caption "Principal and Selling Stockholder" in
the Prospectus that relates to the Selling Stockholder (the "Selling Stockholder
Statements") constitute the only information furnished in writing by or on
behalf of the Selling Stockholder expressly for use in the Registration
Statement relating to the Shares as originally filed or in any amendment
thereof, related preliminary prospectus or the Prospectus or in any amendment
thereof or supplement thereto, as the case may be.
(g) Such Selling Stockholder has not taken, directly or
indirectly, any action designed to or that would constitute or that could
reasonably be expected to cause or result in, under the Exchange Act or
otherwise, stabilization or manipulation of the price of any security of the
Company to facilitate the sale or resale of the Shares in violation of
Regulation M under the Exchange Act.
(h) The Selling Stockholder has not distributed and, prior to
the completion of the distribution of the Shares, will not distribute without
the Underwriter's prior written consent, any offering material in connection
with the offering and sale of the Shares other than as permitted by the
Securities Act.
12
Any certificate signed by or on behalf of the Selling
Stockholder and delivered to the Underwriter or to counsel for the Underwriter
shall be deemed to be a representation and warranty by the Selling Stockholder
to the Underwriter as to the matters covered thereby.
3. Purchase, Sale and Delivery of the Shares.
(a) On the basis of the representations, warranties, covenants
and agreements herein contained, but subject to the terms and conditions herein
set forth, the Selling Stockholder agrees to sell to the Underwriter, and the
Underwriter agrees to purchase from the Selling Stockholder, at a purchase price
per share of $7.00, the Shares.
(b) Payment of the purchase price for, and delivery of
certificates representing, the Shares shall be made at the office of Xxxxx &
Xxxxxxxxx LLP, or at such other place as shall be agreed upon by the Underwriter
and the Company, at 10:00 A.M., New York City time, on the third or fourth
business day after the determination of the public offering price of the Shares,
or such other time not later than ten business days after such date as shall be
agreed upon by the Underwriter and the Company (such time and date of payment
and delivery being herein called the "Closing Date").
(c) Payment of the purchase price for the Shares shall be made
by wire transfer in same day funds to the Selling Stockholder upon delivery of
certificates for the Shares to the offices of American Stock Transfer & Trust
Company, 00 Xxxxxx Xxxx, Xxx Xxxx, Xxx Xxxx 00000, for the account of the
Underwriter through the facilities of The Depository Trust Company. The Selling
Stockholder hereby agrees that it will pay all stock transfer taxes, stamp
duties and other similar taxes, if any, payable upon the sale or delivery of the
Shares to be sold by the Selling Stockholder to the Underwriter, or otherwise in
connection with the performance of the Selling Stockholder's obligations
hereunder.
4. Offering. Upon authorization of the release of the Shares by the
Underwriter, the Underwriter proposes to offer the Shares for sale to the public
upon the terms and conditions set forth in the Prospectus.
5. Covenants of the Company; Covenants of the Selling Stockholder.
(a) The Company covenants and agrees with the Underwriter
that:
(i) The Registration Statement and any amendments
thereto have been declared effective, and if the filing of the Prospectus is
required under Rule 424(b) or Rule 434, the Company will file the Prospectus
pursuant to Rule 424(b) within the prescribed time period and will provide
evidence satisfactory to the Underwriter of such timely filing.
The Company will notify you immediately (and, if
requested by the Underwriter, will confirm such notice in writing) (A) when the
Registration Statement and any amendments thereto become effective, (B) of any
request by the Commission for any amendment of or supplement to the Registration
Statement or the Prospectus or for any additional information, (C) of the
Company's intention to file or prepare any supplement or amendment to the
Registration Statement or the Prospectus, (D) of the mailing or the delivery to
the Commission for filing of any amendment of or supplement to the Registration
Statement or the
13
Prospectus, including but not limited to Rule 462(b) under the Securities Act,
(E) of the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or any post-effective amendment
thereto or of the initiation, or the threatening, of any proceedings therefor,
it being understood that the Company shall make every effort to avoid the
issuance of any such stop order, (F) of the receipt of any comments from the
Commission, and (G) of the receipt by the Company of any notification with
respect to the suspension of the qualification of the Shares for sale in any
jurisdiction or the initiation or threatening of any proceeding for that
purpose. If the Commission shall propose or enter a stop order at any time, the
Company will make every reasonable effort to prevent the issuance of any such
stop order and, if issued, to obtain the lifting of such order as soon as
possible. The Company will not (i) file any amendment to the Registration
Statement or any amendment of or supplement to the Prospectus (including the
prospectus required to be filed pursuant to Rule 424(b) or Rule 434) that
differs from the prospectus on file at the time of the effectiveness of the
Registration Statement, or (ii) for so long as the prospectus delivery
requirement is in effect, file any document under the Exchange Act if such
document would be deemed to be incorporated by reference in the Prospectus, in
either case, to which the Underwriter reasonably objects in writing after being
timely furnished in advance a copy thereof. The Company will provide the
Underwriter with copies of all such amendments, filings and other documents a
sufficient time prior to any filing or other publication thereof to permit the
Underwriter a reasonable opportunity to review and comment thereon.
(ii) The Company shall comply with the Securities Act
and the Exchange Act to permit completion of the distribution as contemplated in
this Agreement, the Registration Statement and the Prospectus. If at any time
when a prospectus relating to the Shares is required to be delivered under the
Securities Act or the Exchange Act in connection with the sales of Shares, any
event shall have occurred as a result of which the Prospectus as then amended or
supplemented would, in the judgment of the Underwriter or the Company, include
an 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 existing at the time of delivery to the
purchaser, not misleading, or if to comply with the Securities Act, the Exchange
Act or the Rules and Regulations it shall be necessary at any time to amend or
supplement the Prospectus or Registration Statement, or to file any document
incorporated by reference in the Registration Statement or the Prospectus or in
any amendment thereof or supplement thereto, the Company will notify you
promptly and prepare and file with the Commission, subject to Section 5(a)(i)
hereof, an appropriate amendment or supplement (in form and substance
satisfactory to the Underwriter) which will correct such statement or omission
or which will effect such compliance and will use its reasonable best efforts to
have any amendment to the Registration Statement declared effective as soon as
possible.
(iii) The Company will promptly deliver to each of
you and Xxxxxx & Xxxxxx L.L.P. ("Underwriter's Counsel") a signed copy of the
Registration Statement, as initially filed and all amendments thereto, including
all consents and exhibits filed therewith, and will maintain in the Company's
files manually signed copies of such documents for at least five years after the
date of filing. The Company will promptly deliver to the Underwriter such number
of copies of any Preliminary Prospectus, the Prospectus, the Registration
Statement, and all amendments of and supplements to such documents, if any, and
all documents incorporated by reference in the Registration Statement and
Prospectus or any amendment thereof or supplement
14
thereto, as you may reasonably request. Prior to 10:00 A.M., New York time or as
promptly as practicable thereafter, on the business day next succeeding the date
of this Agreement and from time to time thereafter, the Company will furnish the
Underwriter with copies of the Prospectus in New York City in such quantities as
you may reasonably request.
(iv) The Company consents to the use and delivery of
the Preliminary Prospectus by the Underwriter in accordance with Rule 430 and
Section 5(b) of the Securities Act.
(v) The Company will use its reasonable best efforts,
in cooperation with the Underwriter, at or prior to the time of effectiveness of
the Registration Statement, to qualify the Shares for offering and sale under
the securities laws relating to the offering or sale of the Shares of such
jurisdictions, domestic or foreign, as the Underwriter may designate and to
maintain such qualification in effect for so long as required for the
distribution thereof; except that in no event shall the Company be obligated in
connection therewith to qualify as a foreign corporation or to execute a general
consent to service of process.
(vi) The Company will make generally available to its
security holders and to the Underwriter as soon as practicable, but in any event
not later than twelve months after the effective date of the Registration
Statement (as defined in Rule 158(c) under the Securities Act), an earnings
statement of the Company and the Subsidiaries (which need not be audited)
complying with Section 11(a) of the Securities Act and the Rules and Regulations
(including, at the option of the Company, Rule 158).
(vii) During the period of 45 days from the date of
the Prospectus, without the prior written consent of the Underwriter, the
Company (A) will not, directly or indirectly, issue, offer, sell, agree to
issue, offer or sell, solicit offers to purchase, grant any call option, warrant
or other right to purchase, purchase any put option or other right to sell,
pledge, borrow or otherwise dispose of any Relevant Security, or make any
announcement of any of the foregoing, (B) will not establish or increase any
"put equivalent position" or liquidate or decrease any "call equivalent
position" (in each case within the meaning of Section 16 of the Exchange Act and
the rules and regulations promulgated thereunder) with respect to any Relevant
Security, and (C) will not otherwise enter into any swap, derivative or other
transaction or arrangement that transfers to another, in whole or in part, any
economic consequence of ownership of a Relevant Security, whether or not such
transaction is to be settled by delivery of Relevant Securities, other
securities, cash or other consideration; and the Company will obtain an
undertaking in substantially the form of Annex IV hereto of each of its
executive officers listed on Schedule II hereto during the period of 45 days
from the date of the Prospectus and an undertaking in substantially the form of
Annex IV hereto of each of its executive officers and directors listed on
Schedule III hereto during the period of 30 days from the date of the
Prospectus, without the prior written consent of the Underwriter, not to engage
in any of the aforementioned transactions on their own behalf, other than the
sale by the Selling Stockholder of Shares as contemplated by this Agreement and
the Company's issuance of Common Stock (A) upon the conversion or exchange of
convertible or exchangeable securities outstanding on the date hereof; (B) upon
the exercise of currently outstanding options; (C) upon the exercise of
currently outstanding warrants; (D) upon the grant and exercise of options
under, or the issuance and sale of shares pursuant to, employee stock incentive,
option and purchase plans in effect on
15
the date hereof; (E) as required by the terms of any earn-out provision
contained in any agreement existing on the date hereof to which the Company is a
party; (F) upon the exercise by the Selling Stockholder of its preemptive right
to acquire Common Stock with respect to any issuances of Common Stock pursuant
to paragraphs (A) to (E) above or any issuance of stock prior to the date hereof
as to which the Selling Stockholder has not exercised its preemptive rights. The
Company will not file a registration statement under the Securities Act in
connection with any transaction by the Company or any person that is prohibited
pursuant to the foregoing, except for registration statements on Form S-8
relating to employee benefit plans or Form S-4 relating to corporate
reorganizations or other transactions under Rule 145.
(viii) During the period of two years from the
effective date of the Registration Statement, the Company will furnish to you
copies of all reports or other communications (financial or other) furnished to
security holders or from time to time published or publicly disseminated by the
Company to the extent not publicly available on XXXXX.
(ix) The Company, during the period when the
Prospectus is required to be delivered under the Securities Act or the Exchange
Act, will file all documents required to be filed with the Commission pursuant
to the Securities Act, the Exchange Act and the Rules and Regulations within the
time periods required thereby.
(x) The Company will use its reasonable best efforts
to do and perform all things required to be done or performed under this
Agreement by the Company prior to the Closing Date and to satisfy all conditions
precedent to the delivery of the Shares.
(xi) The Company will not take, and will cause its
Controlled Affiliates not to take, directly or indirectly, any action which
constitutes or is designed to cause or result in, or which could reasonably be
expected to constitute, cause or result in, the stabilization or manipulation of
the price of any security to facilitate the sale or resale of the Shares.
(b) The Selling Stockholder covenants and agrees with the
Underwriter:
(i) To deliver to the Underwriter prior to the
Closing Date, a properly completed and executed United States Treasury
Department Form W-8 (if the Selling Stockholder is a non-United States Person)
or Form W-9 (if the Selling Stockholder is a United States Person), which in
each case may be replaced by any other applicable form or statement specified by
Treasury Department regulations in lieu thereof;
(ii) To notify promptly the Company and the
Underwriter if, at any time prior to the date on which the distribution of the
Shares as contemplated herein and in the Prospectus has been completed, as
determined by the Underwriter, the Selling Stockholder has knowledge of the
occurrence of any event as a result of which the Selling Stockholder Statements,
as then amended or supplemented, would include an untrue statement of a material
fact or omit to state any material fact necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading;
(iii) To cooperate to the extent necessary to cause
the Registration Statement or any post-effective amendment thereto to become
effective at the earliest possible time and to do and perform all things to be
done and performed by it under this Agreement prior
16
to the Closing Date and to cooperate to the extent necessary to cause the
satisfaction of all conditions precedent to the delivery of the Shares pursuant
to this Agreement; and
(iv) To deliver to the Underwriter on or prior to the
Closing Date the lock-up agreement referenced in Section 7(i) hereof, which
lock-up agreement will be in effect for a period of 45 days.
6. Payment of Expenses.
(a) Whether or not the transactions contemplated by this
Agreement, the Registration Statement and the Prospectus are consummated or this
Agreement is terminated, the Company hereby agrees to pay all costs and expenses
incident to the performance of its obligations hereunder, including the
following: (i) all expenses in connection with the preparation, printing and
filing of the Registration Statement, any Preliminary Prospectus and the
Prospectus and any and all amendments and supplements thereto and the mailing
and delivering of copies thereof to the Underwriter and dealers; (ii) the fees,
disbursements and expenses of the Company's counsel and accountants in
connection with the registration of the Shares under the Securities Act and the
Offering; (iii) the cost of producing this Agreement, blue sky survey, closing
documents and other instruments, agreements or documents (including any
compilations thereof) in connection with the Offering; (iv) all expenses in
connection with the qualification of the Shares for offering and sale under
state or foreign securities or blue sky laws as provided in Section 5(a)(v)
hereof, including the fees and disbursements of counsel for the Underwriter in
connection with such qualification and in connection with any blue sky survey;
(v) the filing fees incident to, and the fees and disbursements of counsel for
the Underwriter in connection with, securing any required review by the NASD of
the terms of the Offering; (vi) all fees and expenses in connection with listing
the Shares on the NYSE; (vii) all travel expenses of the Company's officers and
employees and any other expense of the Company incurred in connection with
attending or hosting meetings with prospective purchasers of the Shares; (viii)
any stock transfer taxes incurred in connection with this Agreement or the
Offering; and (ix) reasonable out-of-pocket expenses incurred by the Selling
Stockholder related to the offering of the Shares, including, without
limitation, all reasonable expenses incurred directly by the Selling Stockholder
for one legal counsel (other than underwriting fees, discounts and selling
commissions). The Company also will pay or cause to be paid: (x) the cost of
preparing stock certificates representing the Shares; (y) the cost and charges
of any transfer agent or registrar for the Shares; and (z) all other costs and
expenses incident to the performance of its obligations hereunder which are not
otherwise specifically provided for in this Section 6.
(b) The net price per share paid to the Selling Stockholder in
Section 3(a) reflects all underwriting fees, discounts and selling commissions
payable by the Selling Stockholder. Whether or not the transactions contemplated
by this Agreement, the Registration Statement and the Prospectus are consummated
or this Agreement is terminated, any expenses incident to the performance of its
obligations hereunder and that the Company is not obligated to pay pursuant to
subsection (a) above. Notwithstanding the foregoing, nothing herein shall affect
any agreement that the Company and the Selling Stockholder may make for the
sharing or allocation of such costs and expenses.
17
(c) Except as provided in this Section 6, and Sections 8 and 9
hereof, the Underwriter will pay all of its own costs and expenses, including
the fees of its counsel and stock transfer taxes on resale of any of the Shares
by the Underwriter. Notwithstanding anything to the contrary in this Section 6,
the Selling Stockholder will pay all out-of-pocket expenses of the Underwriter
(including but not limited to fees and disbursements of counsel to the
Underwriter) reasonably incurred in connection herewith in the event that this
Agreement is terminated pursuant to Section 7 for the Selling Stockholder's
failure or inability to satisfy any of the conditions relating to the Selling
Stockholder contained in the introductory paragraph to Section 7 or any of the
conditions contained in Section 7(d), (i) (in the case of the Selling
Stockholder), (j) or (k) or pursuant to Section 11 or in the event the Selling
Stockholder defaults in its obligation to sell or deliver the Shares hereunder.
(d) If this Agreement is terminated pursuant to Section 11 or
if for any reason the purchase of the Shares by the Underwriter is not
consummated, the Company and the Selling Stockholder shall remain responsible
for the respective expenses to be paid or reimbursed by each of them pursuant to
this Section 6. If the purchase of the Shares by the Underwriter is not
consummated for any reason other than (A) a default by the Selling Stockholder
in its obligation to sell or deliver the Shares hereunder, (B) any reason
specified in subsection (c) above, or (C) the occurrence of any event specified
in clause (i), (ii), (iii) or (iv) of Section 13(b), the Company will reimburse
the Underwriter for all out-of-pocket expenses (including fees and disbursements
of counsel) reasonably incurred by the Underwriter in connection with the
offering of the Shares.
(e) Notwithstanding anything to the contrary in this Section
6, in the event that this Agreement is terminated, or the purchase of the Shares
is not consummated, as a result of the occurrence of any event specified in (A)
clause (iv) or (vi) of Section 7(f), (B) Section 7(h) or (C) clause (v) or (vi)
of Section 13(b), the Company and the Selling Stockholder agree that they will
each pay 50% of all out-of-pocket expenses of the Underwriter (including but not
limited to fees and disbursements of counsel to the Underwriter) reasonably
incurred in connection herewith.
7. Conditions of Underwriter's Obligations. The obligations of the
Underwriter to purchase and pay for the Shares, as provided herein, shall be
subject to the accuracy of the representations and warranties of the Company and
the Selling Stockholder herein contained, as of the date hereof and as of the
Closing Date (for purposes of this Section 7, "Closing Date" shall refer to the
Closing Date for the Shares), to the absence from any certificates, opinions,
written statements or letters furnished to you or to Underwriter's Counsel
pursuant to this Section 7 of any misstatement or omission, to the performance
by the Company and the Selling Stockholder of its respective obligations
hereunder, and to each of the following additional conditions:
(a) The Registration Statement shall have become effective and
all necessary regulatory or stock exchange approvals shall have been received
not later than 5:30 P.M., New York time, on the date of this Agreement, or at
such later time and date as shall have been consented to in writing by the
Underwriter; if the Company shall have elected to rely upon Rule 434 under the
Securities Act, the Prospectus shall have been filed with the Commission in a
timely fashion in accordance with Section 5(a)(i) hereof and a form of the
Prospectus containing information relating to the description of the Shares and
the method of distribution and similar matters shall have been filed with the
Commission pursuant to Rule 424(b) within the applicable
18
time period; and, at or prior to the Closing Date no stop order suspending the
effectiveness of the Registration Statement or any post-effective amendment
thereof shall have been issued and no proceedings therefor shall have been
initiated or threatened by the Commission.
(b) At the Closing Date you shall have received the favorable
written opinion of Xxxxx & Xxxxxxxxx LLP, counsel for the Company, dated the
Closing Date addressed to the Underwriter in the form attached hereto as Annex
I.
(c) At the Closing Date you shall have received the favorable
written opinion of Xxxx X. Xxxxxx, General Counsel to the Company, dated the
Closing Date addressed to the Underwriter in the form attached hereto as Annex
II.
(d) At the Closing Date, you shall have received the favorable
written opinion of Xxxxxx, Xxxx & Xxxxxxxx LLP, counsel for the Selling
Stockholder, dated the Closing Date, addressed to the Underwriter in the form
attached hereto as Annex III.
(e) All proceedings taken in connection with the sale of the
Shares as herein contemplated shall be satisfactory in form and substance to the
Underwriter and to Underwriter's Counsel, and the Underwriter shall have
received from Underwriter's Counsel a favorable written opinion, dated as of the
Closing Date, with respect to the issuance and sale of the Shares, the
Registration Statement and the Prospectus and such other related matters as the
Underwriter may require, and the Company shall have furnished to Underwriter's
Counsel such documents as they may reasonably request for the purpose of
enabling them to pass upon such matters.
(f) At the Closing Date you shall have received a certificate
of the Chief Executive Officer and Chief Financial Officer of the Company, dated
the Closing Date to the effect that (i) the condition set forth in subsection
(a) of this Section 7 has been satisfied; (ii) as of the date hereof and as of
the Closing Date, the representations and warranties of the Company set forth in
Section 1 hereof are accurate in all material respects (and in all respects, in
the case of representations and warranties qualified with materiality); (iii) as
of the Closing Date all agreements, conditions and obligations of the Company to
be performed or complied with hereunder on or prior thereto have been duly
performed or complied with; (iv) since September 30, 2004, the Company and the
Subsidiaries, taken as a whole, have not 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; (v) no stop
order suspending the effectiveness of the Registration Statement or any
post-effective amendment thereof has been issued and no proceedings therefor
have been initiated or threatened by the Commission; and (vi) subsequent to the
respective dates as of which information is given in the Registration Statement
and the Prospectus there has not been any Material Adverse Change.
(g) At the Closing Date, you shall have received a comfort
letter, from PricewaterhouseCoopers LLP, independent public accountants for the
Company, dated as of the Closing Date addressed to the Underwriter and in form
and substance satisfactory to the Underwriter and Underwriter's Counsel.
19
(h) Subsequent to the execution and delivery of this Agreement
or, if earlier, the dates as of which information is given in the Registration
Statement (exclusive of any amendment thereof) and the Prospectus (exclusive of
any supplement thereto), there shall not have been any change in the capital
stock or long-term debt of the Company or any Subsidiary or any change or
development involving a change, whether or not arising from transactions in the
ordinary course of business, in the business, condition (financial or
otherwise), results of operations, stockholders' equity, properties or prospects
of the Company and the Subsidiaries, taken as a whole, including but not limited
to the occurrence of any fire, flood, storm, explosion, accident or other
calamity at any of the properties owned or leased by the Company or any of its
Subsidiaries, the effect of which, in any such case described above, is, in the
judgment of the Underwriter, so material and adverse as to make it impracticable
or inadvisable to proceed with the Offering on the terms and in the manner
contemplated in the Prospectus (exclusive of any supplement).
(i) You shall have received a duly executed lock-up agreement
from the Selling Stockholder and each person listed on Schedule II and Schedule
III hereto, in each case substantially in the form attached hereto as Annex IV
on or prior to the Closing Date.
(j) At the Closing Date, you shall have received a certificate
of an authorized representative of the Selling Stockholder, dated the Closing
Date, to the effect that the representations and warranties of the Selling
Stockholder set forth in Section 2 hereof are accurate and that the Selling
Stockholder has complied with all agreements and satisfied all conditions on its
part to be performed or satisfied hereunder at or prior to the Closing Date.
(k) On or prior to the Closing Date, you shall have received a
properly completed and executed United States Treasury Department Form W-9 (or
other applicable form or statement specified by Treasury Department regulations
in lieu thereof) from the Selling Stockholder.
(l) The Company shall have furnished the Underwriter and
Underwriter's Counsel with such other certificates or other documents as they
may have reasonably requested.
If any of the conditions specified in this Section 7 shall not
have been fulfilled when and as required by this Agreement, or if any of the
certificates, opinions, written statements or letters furnished to you or to
Underwriter's Counsel pursuant to this Section 7 shall not be satisfactory in
form and substance to the Underwriter and to Underwriter's Counsel, all
obligations of the Underwriter hereunder may be cancelled by the Underwriter at,
or at any time prior to, the Closing Date. Notice of such cancellation shall be
given to the Company in writing, or by telephone. Any such telephone notice
shall be confirmed promptly thereafter in writing.
8. Indemnification.
(a) The Company shall indemnify and hold harmless the
Underwriter and each person, if any, who controls the Underwriter within the
meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act,
against any and all losses, liabilities, claims, damages and expenses whatsoever
as incurred (including but not limited to attorneys' fees and any and all
expenses whatsoever incurred in investigating, preparing or defending against
any
20
litigation, commenced or threatened, or any claim whatsoever, and any and all
amounts paid in settlement of any claim or litigation), joint or several, to
which they or any of them may become subject under the Securities Act, the
Exchange Act or otherwise, insofar as such losses, liabilities, claims, damages
or expenses (or actions in respect thereof) arise out of or are based upon any
untrue statement or alleged untrue statement of a material fact contained in the
Registration Statement, as originally filed or any amendment thereof, or any
related Preliminary Prospectus or the Prospectus, or in any supplement thereto
or amendment thereof, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading; provided, however, that
the Company will not be liable in any such case to the extent but only to the
extent that any such loss, liability, claim, damage or expense arises out of or
is based upon any such untrue statement or alleged untrue statement or omission
or alleged omission made therein in reliance upon and in conformity with the
Selling Stockholder Statements or written information furnished to the Company
by the Underwriter expressly for use therein. The parties agree that such
information provided by the Underwriter consists solely of the material referred
to in the last sentence of Section 1(b) hereof. Notwithstanding the foregoing,
with respect to any untrue statement or alleged untrue statement in or omission
or alleged omission from any Preliminary Prospectus the indemnity agreement
contained in this subsection (a) shall not inure to the benefit of any
Underwriter (or any person who controls such Underwriter within the meaning of
Section 15 of the Securities Act or Section 20 of the Exchange Act) from whom
the person asserting any such losses, claims, damages or liabilities purchased
the Shares concerned, to the extent that a Prospectus relating to such Shares
was required to be delivered by such Underwriter under the Securities Act in
connection with such purchase and any such loss, claim, damage or liability of
such Underwriter results from the fact that there was not sent or given to such
person, at or prior to the written confirmation of the sale of such Shares to
such person, a copy of the Prospectus (exclusive of material incorporated by
reference) if the Company had previously furnished copies thereof to such
Underwriter. This indemnity agreement will be in addition to any liability which
the Company may otherwise have, including but not limited to other liability
under this Agreement.
(b) The Selling Stockholder shall indemnify and hold harmless
the Underwriter and each person, if any, who controls the Underwriter within the
meaning of Section 15 of the Securities Act or Section 20(a) of the Exchange Act
against any and all losses, liabilities, claims, damages and expenses whatsoever
as incurred (including but not limited to reasonable attorneys' fees and any and
all expenses whatsoever incurred in investigating, preparing or defending
against any litigation, commenced or threatened, or any claim whatsoever and any
and all amounts paid in settlement of any claim or litigation), joint or
several, to which they or any of them may become subject under the Securities
Act, the Exchange Act or otherwise, insofar as such losses, liabilities, claims,
damages or expenses (or actions in respect thereof) arise out of or are based
upon any untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement for the registration of the Shares, as
originally filed or any amendment thereof, or any related Preliminary Prospectus
or the Prospectus, or in any supplement thereto or amendment thereof, or arise
out of or are based upon the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading but only with respect to untrue statements or omissions,
or alleged untrue statements or omissions, made in the Registration Statement
(or any amendment thereto), or any Preliminary Prospectus or the Prospectus (or
any
21
amendment or supplement thereto) in reliance upon and in conformity with written
information furnished to the Company by the Selling Stockholder expressly for
use in the Registration Statement (or any amendment thereto) or such Preliminary
Prospectus or the Prospectus (or any amendment or supplement thereto). The
Underwriter acknowledges that the Selling Stockholder Statements constitute the
only information furnished in writing by or on behalf of the Selling Stockholder
expressly for use in the Registration Statement relating to the Shares as
originally filed or in any amendment thereof, related Preliminary Prospectus or
the Prospectus or in any amendment thereof or supplement thereto, as the case
may be. Notwithstanding the foregoing, with respect to any untrue statement or
alleged untrue statement in or omission or alleged omission from any Preliminary
Prospectus the indemnity agreement contained in this subsection (b) shall not
inure to the benefit of the Underwriter (or any person who controls the
Underwriter within the meaning of Section 15 of the Securities Act or Section 20
of the Exchange Act) from whom the person asserting any such losses, claims,
damages or liabilities purchased the Shares concerned, to the extent that a
Prospectus relating to such Shares was required to be delivered by such
Underwriter under the Securities Act in connection with such purchase and any
such loss, claim, damage or liability of the Underwriter results from the fact
that there was not sent or given to such person, at or prior to the written
confirmation of the sale of such Shares to such person, a copy of the Prospectus
(exclusive of material incorporated by reference) if the Company had previously
furnished copies thereof to the Underwriter.
(c) The Underwriter shall indemnify and hold harmless the
Company, the Selling Stockholder, each of the directors of the Company, each of
the officers of the Company who shall have signed the Registration Statement,
and each other person, if any, who controls the Company within the meaning of
Section 15 of the Securities Act or Section 20 of the Exchange Act, against any
losses, liabilities, claims, damages and expenses whatsoever as incurred
(including but not limited to attorneys' fees and any and all expenses
whatsoever incurred in investigating, preparing or defending against any
litigation, commenced or threatened, or any claim whatsoever, and any and all
amounts paid in settlement of any claim or litigation), joint or several, to
which they or any of them may become subject under the Securities Act, the
Exchange Act or otherwise, insofar as such losses, liabilities, claims, damages
or expenses (or actions in respect thereof) arise out of or are based upon any
untrue statement or alleged untrue statement of a material fact contained in the
Registration Statement, as originally filed or any amendment thereof, or any
related Preliminary Prospectus or the Prospectus, or in any amendment thereof or
supplement thereto, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, in each case to the
extent, but only to the extent, that any such loss, liability, claim, damage or
expense arises out of or is based upon any such untrue statement or alleged
untrue statement or omission or alleged omission made therein in reliance upon
and in conformity with information furnished in writing to the Company by the
Underwriter specifically for use therein. The parties agree that such
information provided by the Underwriter consists solely of the material referred
to in the last sentence of Section 1(b) hereof. This indemnity will be in
addition to any liability which the Underwriter may otherwise have, including
but not limited to other liability under this Agreement.
(d) Promptly after receipt by an indemnified party under
subsection (a), (b) or (c) above of notice of any claims or the commencement of
any action, such indemnified party shall, if a claim in respect thereof is to be
made against the indemnifying party under such
22
subsection, notify each party against whom indemnification is to be sought in
writing of the claim or the commencement thereof (but the failure so to notify
an indemnifying party shall not relieve the indemnifying party from any
liability which it may have under this Section 8 to the extent that it is not
materially prejudiced as a result thereof and in any event shall not relieve it
from any liability that such indemnifying party may have otherwise than on
account of the indemnity agreement hereunder). In case any such claim or action
is brought against any indemnified party, and it notifies an indemnifying party
of the commencement thereof, the indemnifying party will be entitled to
participate, at its own expense in the defense of such action, and to the extent
it may elect by written notice delivered to the indemnified party promptly after
receiving the aforesaid notice from such indemnified party, to assume the
defense thereof with counsel satisfactory to such indemnified party; provided
however, that counsel to the indemnifying party shall not (except with the
written consent of the indemnified party) also be counsel to the indemnified
party. Notwithstanding the foregoing, the indemnified party or parties shall
have the right to employ its or their own counsel in any such case, but the fees
and expenses of such counsel shall be at the expense of such indemnified party
or parties unless (i) the employment of such counsel shall have been authorized
in writing by one of the indemnifying parties in connection with the defense of
such action, (ii) the indemnifying parties shall not have employed counsel to
have charge of the defense of such action within a reasonable time after notice
of commencement of the action, (iii) the indemnifying party does not diligently
defend the action after assumption of the defense, or (iv) such indemnified
party or parties shall have reasonably concluded that there may be defenses
available to it or them which are different from or additional to those
available to one or all of the indemnifying parties (in which case the
indemnifying parties shall not have the right to direct the defense of such
action on behalf of the indemnified party or parties), in any of which events
such fees and expenses shall be borne by the indemnifying parties. No
indemnifying party shall, without the prior written consent of the indemnified
parties, effect any settlement or compromise of, or consent to the entry of
judgment with respect to, any pending or threatened claim, investigation, action
or proceeding in respect of which indemnity or contribution may be or could have
been sought by an indemnified party under this Section 8 or Section 9 hereof
(whether or not the indemnified party is an actual or potential party thereto),
unless (x) such settlement, compromise or judgment (i) includes an unconditional
release of the indemnified party from all liability arising out of such claim,
investigation, action or proceeding and (ii) does not include a statement as to
or an admission of fault, culpability or any failure to act, by or on behalf of
the indemnified party, and (y) the indemnifying party confirms in writing its
indemnification obligations hereunder with respect to such settlement,
compromise or judgment.
9. Contribution. In order to provide for contribution in circumstances
in which the indemnification provided for in Section 8 hereof is for any reason
held to be unavailable from any indemnifying party or is insufficient to hold
harmless a party indemnified thereunder, the Company and the Selling Stockholder
on the one hand and the Underwriter on the other hand shall contribute to the
aggregate losses, claims, damages, liabilities and expenses of the nature
contemplated by such indemnification provision (including any investigation,
legal and other expenses incurred in connection with, and any amount paid in
settlement of, any action, suit or proceeding or any claims asserted, but after
deducting in the case of losses, claims, damages, liabilities and expenses
suffered by the Company and the Selling Stockholder, any contribution received
by the Company and the Selling Stockholder from persons, other than the
Underwriter, who may also be liable for contribution, including persons who
control the Company or the
23
Selling Stockholder within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act, officers of the Company who signed the
Registration Statement and directors of the Company) as incurred to which the
Company, the Selling Stockholder and the Underwriter may be subject, in such
proportions as is appropriate to reflect the relative benefits received by the
Company and the Selling Stockholder on the one hand and the Underwriter on the
other hand from the Offering or, if such allocation is not permitted by
applicable law, in such proportions as are appropriate to reflect not only the
relative benefits referred to above but also the relative fault of the Company
and the Selling Stockholder on the one hand and the Underwriter on the other
hand in connection with the statements or omissions which resulted in such
losses, claims, damages, liabilities or expenses, as well as any other relevant
equitable considerations; provided, the Selling Stockholder and the Underwriter
shall be obligated to contribute under this Section 9 only with respect to
losses, liabilities, claims, damages or expenses arising out of an untrue
statement or omission or alleged untrue statement or omission of a material fact
made in reliance upon and in conformity with the information described in
Section 8(b) or Section 8(c), respectively, hereunder. The relative benefits
received by the Company and the Selling Stockholder on the one hand and the
Underwriter on the other hand shall be deemed to be in the same proportion as
(x) the total proceeds from the Offering (net of underwriting discounts and
commissions but before deducting expenses) received by the Company and the
Selling Stockholder bears to (y) the underwriting discount or commissions
received by the Underwriter, in each case as set forth in the table on the cover
page of the Prospectus. The relative fault of each of the Company and the
Selling Stockholder on the one hand and of the Underwriter on the other hand
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 a
Selling Stockholder on the one hand or the Underwriter on the other hand and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission. The Company, the Selling
Stockholder and the Underwriter further agree that it would not be just and
equitable if contribution pursuant to this Section 9 were determined by pro rata
allocation or by any other method of allocation which does not take account of
the equitable considerations referred to above in this Section 9. The aggregate
amount of losses, liabilities, claims, damages and expenses incurred by an
indemnified party and referred to above in this Section 9 shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified
party in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any judicial, regulatory or other legal or
governmental agency or body, commenced or threatened, or any claim whatsoever
based upon any such untrue or alleged untrue statement or omission or alleged
omission. Notwithstanding the provisions of this Section 9, (i) the Underwriter
shall not be required to contribute any amount in excess of the amount by which
the discounts and commissions applicable to the Shares underwritten by it and
distributed to the public exceeds the amount of any damages which the
Underwriter has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission, (ii) the Selling
Stockholder shall not be required to contribute any amount in excess of the
total proceeds received by the Selling Stockholder from the offering of the
Shares by the Selling Stockholder by reason of any such untrue statement or
alleged untrue statement or omission or alleged omission, and (iii) 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. For purposes of this Section 9,
each person, if any,
24
who controls the Underwriter within the meaning of Section 15 of the Securities
Act or Section 20 of the Exchange Act shall have the same rights to contribution
as the Underwriter, and each person, if any, who controls the Company within the
meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act,
each officer of the Company who shall have signed the Registration Statement and
each director of the Company shall have the same rights to contribution as the
Company and the Selling Stockholder, as applicable, subject in each case to
clauses (i), (ii) and (iii) of the immediately preceding sentence. Any party
entitled to contribution will, promptly after receipt of notice of commencement
of any action, suit or proceeding against such party in respect of which a claim
for contribution may be made against another party or parties, notify each party
or parties from whom contribution may be sought, but the omission to so notify
such party or parties shall not relieve the party or parties from whom
contribution may be sought from any obligation it or they may have under this
Section 9 or otherwise.
10. [This section left intentionally blank.]
11. Selling Stockholder Default. If the Selling Stockholder shall
default in its obligation to sell and deliver any Shares hereunder, then the
Underwriter may, by notice to the Company, terminate this Agreement without any
liability on the part of any non-defaulting party except that the provisions of
Sections 1, 2, 6, 8, 9, 12, 13 and 14 through 19 inclusive hereof shall remain
in full force and effect. No action taken pursuant to this Section 11 shall
relieve the Selling Stockholder so defaulting from liability, if any, in respect
of such default.
12. Survival of Representations and Agreements. All representations and
warranties, covenants and agreements of the Underwriter, the Company and the
Selling Stockholder contained in this Agreement or in certificates of officers
of the Company or any Subsidiary or of the Selling Stockholder submitted
pursuant hereto, including the agreements contained in Section 6, the indemnity
agreements contained in Section 8 and the contribution agreements contained in
Section 9, shall remain operative and in full force and effect regardless of any
investigation made by or on behalf of the Underwriter or any controlling person
thereof or by or on behalf of the Company or the Selling Stockholder, any of
their officers and directors or any controlling person thereof, and shall
survive delivery of and payment for the Shares to and by the Underwriter. The
representations contained in Sections 1 and 2 and the agreements contained in
Sections 6, 8, 9, 12, 13 and 14 through 19 inclusive shall survive any
termination of this Agreement, including termination pursuant to Section 11 or
13 hereof.
13. Effective Date of Agreement; Termination.
(a) This Agreement shall become effective upon the execution
of this Agreement.
(b) The Underwriter shall have the right to terminate this
Agreement at any time prior to the Closing Date if (i) any domestic or
international event or act or occurrence has materially disrupted, or in the
opinion of the Underwriter will in the immediate future materially disrupt, the
market for the Company's securities or securities in general; or (ii) if trading
on The New York Stock Exchange ("the NYSE"), or The NASDAQ National Market (the
"NASDAQ") shall have been suspended or been made subject to material
limitations, or minimum or
25
maximum prices for trading shall have been fixed, or maximum ranges for prices
for securities shall have been required, on the NYSE, the NASDAQ or by order of
the Commission or any other governmental authority having jurisdiction; or (iii)
if a banking moratorium has been declared by any state or federal authority or
if any material disruption in commercial banking or securities settlement or
clearance services shall have occurred; (iv) (A) if there shall have occurred
any outbreak or escalation of hostilities or acts of terrorism involving the
United States or there is a declaration of a national emergency or war by the
United States or (B) if there shall have been any other calamity or crisis or
any change in political, financial or economic conditions if the effect of any
such event in (A) or (B), in the judgment of the Underwriter, makes it
impracticable or inadvisable to proceed with the offering, sale and delivery of
the Shares on the terms and in the manner contemplated by the Prospectus; (v)
any change, or any development or event involving a prospective change, in the
condition (financial or other), business, properties or results of operations of
the Company and its Subsidiaries taken as a whole which, in the judgment of the
Underwriter, is material and adverse and makes it impractical or inadvisable to
proceed with completion of the public offering or the sale of and payment for
the Shares; or (vi) any suspension of trading of any securities of the Company
on the New York Stock Exchange.
(c) Any notice of termination pursuant to this Section 13
shall be in writing.
14. Notices. All communications hereunder, except as may be otherwise
specifically provided herein, shall be in writing, and:
(a) if sent to the Underwriter, shall be mailed, delivered, or
faxed and confirmed in writing, to X.X. Xxxxxx Securities Inc., 000 Xxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000, Attn: Equity Syndicate, with a copy to Xxxxxx & Xxxxxx
L.L.P. at 1001 Xxxxxx, 0000 Xxxxx Xxxx Xxxxx, Xxxxxxx, Xxxxx 00000-0000,
Attention: T. Xxxx Xxxxx;
(b) if sent to the Company, shall be mailed, delivered, or
faxed and confirmed in writing to Quanta Services, Inc., 0000 Xxxx Xxx Xxxx.,
Xxxxx 0000, Xxxxxxx, Xxxxx 00000-0000, Attention: Xxxx X. Xxxxxx, Esq., with a
copy to Xxxxx & Xxxxxxxxx LLP at 0000 Xxxxxxxxx, Xxxxx 0000, Xxxxxxx, Xxxxx
00000, Attention: W. Xxxxxx Xxxxxxx; and
(c) if sent to the Selling Stockholder, shall be mailed,
delivered, or faxed and confirmed in writing to 000 Xxxxxx, Xxxxx 0000, Xxxxxxx,
Xxxxx, Attention: Xxx X. Xxxxx, with a copy to Xxx Xxxxxxxxx Xxxxx, Xxxxxxxxx,
Xxxxxxxxxxx 00000, Attention: Xxxxxx X. Xxxxxxx.
15. Parties. This Agreement shall insure solely to the benefit of, and
shall be binding upon, the Underwriter, the Company and the Selling Stockholder
and the controlling persons, directors, officers, employees and agents referred
to in Sections 8 and 9 hereof, and their respective successors and assigns, and
no other person shall have or be construed to have any legal or equitable right,
remedy or claim under or in respect of or by virtue of this Agreement or any
provision herein contained. This Agreement and all conditions and provisions
hereof are intended to be for the sole and exclusive benefit of the parties
hereto and said controlling persons and their respective successors, officers,
directors, heirs and legal representatives, and it is not for the benefit of any
other person, firm or corporation. The term "successors and assigns" shall not
include a purchaser, in its capacity as such, of Shares from the Underwriter.
26
16. Governing Law and Jurisdiction; Waiver of Jury Trial. THIS
AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK. Each of the Company and the Selling Stockholder irrevocably
(a) submits to the jurisdiction of any court of the State of New York or the
United State District Court for the Southern District of the State of New York
for the purpose of any suit, action, or other proceeding arising out of this
Agreement, or any of the agreements or transactions contemplated by this
Agreement, the Registration Statement and the Prospectus (each, a "Proceeding"),
(b) agrees that all claims in respect of any Proceeding may be heard and
determined in any such court, (c) waives, to the fullest extent permitted by
law, any immunity from jurisdiction of any such court or from any legal process
therein, (d) agrees not to commence any Proceeding other than in such courts,
and (e) waives, to the fullest extent permitted by law, any claim that such
Proceeding is brought in an inconvenient forum. EACH OF THE COMPANY AND THE
SELLING STOCKHOLDER (ON BEHALF OF ITSELF AND, TO THE FULLEST EXTENT PERMITTED BY
LAW, ON BEHALF OF ITS RESPECTIVE EQUITY HOLDERS AND CREDITORS) HEREBY WAIVES ANY
RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY CLAIM BASED UPON, ARISING
OUT OF OR IN CONNECTION WITH THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED BY
THIS AGREEMENT, THE REGISTRATION STATEMENT AND THE PROSPECTUS.
17. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such
counterparts shall together constitute one and the same instrument. Delivery of
a signed counterpart of this Agreement by facsimile transmission shall
constitute valid and sufficient delivery thereof.
18. Headings. The headings herein are inserted for convenience of
reference only and are not intended to be part of, or to affect the meaning or
interpretation of, this Agreement.
19. Time is of the Essence. Time shall be of the essence of this
Agreement. As used herein, the term "business day" shall mean any day when the
Commission's office in Washington, D.C. is open for business.
[SIGNATURE PAGE FOLLOWS]
27
If the foregoing correctly sets forth your understanding, please so
indicate in the space provided below for that purpose, whereupon this letter
shall constitute a binding agreement among us.
Very truly yours,
QUANTA SERVICES, INC.
By:
-------------------------------------
Name:
Title:
FIRST RESERVE FUND IX, L.P.
By: First Reserve GP IX, L.P., its general partner
By: First Reserve GP IX, Inc., its general partner
By:
-------------------------------------
Name:
Title:
Accepted as of the date first above written
X.X. XXXXXX SECURITIES INC.
By:
---------------------
Name:
Title:
28
SCHEDULE I
SUBSIDIARY STATE OF INCORPORATION
------------- ----------------------
Advanced Technologies and Installation Corporation Washington
Airlan Telecom Services, L.P. Texas
Allteck Line Contractors (USA), Inc. Washington
Allteck Line Contractors, Inc. British Columbia
Arby Construction, Inc. Delaware
Austin Trencher, Inc. Delaware
Bradford Brothers, Inc. North Carolina
CCLC, Inc. Delaware
Coast to Coast, LLC California
CMI Services, Inc. Florida
Xxxxx Communications, Inc. Delaware
Xxxxx Electric Company, Inc. Delaware
Crown Fiber Communications, Inc. Virginia
Digco Utility Construction, L.P. Texas
Xxxxxxx Xxxxx Construction Company Delaware
Driftwood Electrical Contractors, Inc. Delaware
Environmental Professional Associates, Limited California
Five Points Construction Co. Texas
Global Enercom Management, Inc. Delaware
Golden State Utility Co. Delaware
X.X. Xxxxxxx Pipeline Construction, Inc. Delaware
Intermountain Electric, Inc. Colorado
Xxxx Construction Company Mississippi
Xxxxxxx Electric, L.P. Texas
Xxxxxx Bros., Inc. Delaware
Xxxxx Canada Corp. Nova Scotia
Xxxxx Engineering, LLC Michigan
Xxxxx Group, Inc. Delaware
Xxxxx Services, LLC Michigan
Xxxxx/CPG, LLC Michigan
Xxxxx/HDD, LLC Michigan
Mearsmex, S. de X.X. de C.V. Mexico
Xxxxx Personnel Services, Inc. Texas
Metro Underground Services of Illinois, Inc. Illinois
Network Electric Company Delaware
North Houston Pole Line, L.P. Delaware
North Pacific Construction Co., Inc. Texas
North Sky Communications, Inc. Delaware
Northern Line Layers, LLC Delaware
Okay Construction Company, LLC Delaware
SCHEDULE I-1
SUBSIDIARY STATE OF INCORPORATION
------------- ----------------------
PAR Electrical Contractors, Inc. Missouri
Par Internacional, S. de X.X. de C.V. Mexico
Parkside Site and Utility Company Corporation Delaware
Parkside Utility Construction Corp. Delaware
Potelco, Inc. Washington
Professional Teleconcepts, Inc. Illinois
Professional Teleconcepts, Inc. New York
PWR Financial Company Delaware
PWR Network, LLC Delaware
Q Resources, LLC Delaware
QDE LLC Delaware
QPC, Inc. Delaware
QSI, Inc. Delaware
Quanta Asset Management LLC Delaware
Quanta Associates, L.P. Texas
Quanta Delaware, Inc. Delaware
Quanta Government Services, Inc. Delaware
Quanta Government Solutions, Inc. Delaware
Quanta International Limited British Virgin Islands
Quanta LIV Acquisition, Inc. Delaware
Quanta LIX Acquisition, Inc. Delaware
Quanta LVII Acquisition, Inc. Delaware
Quanta LVIII Acquisition, Inc. Delaware
Quanta LX Acquisition, Inc. Delaware
Quanta LXI Acquisition, Inc. Delaware
Quanta LXII Acquisition, Inc. Delaware
Quanta LXIII Acquisition, Inc. Delaware
Quanta LXIV Acquisition, Inc. Delaware
Quanta LXIX Acquisition, Inc. Delaware
Quanta LXV Acquisition, Inc. Delaware
Quanta LXVI Acquisition, Inc. Delaware
Quanta LXVII Acquisition, Inc. Delaware
Quanta LXVIII Acquisition, Inc. Delaware
Quanta LXX Acquisition, Inc. Delaware
Quanta LXXI Acquisition, Inc. Delaware
Quanta LXXII Acquisition, Inc. Delaware
Quanta LXXIII Acquisition, Inc Delaware
Quanta Receivables, L.P. Delaware
Quanta Services Management Partnership, L.P. Texas
Quanta Services of Canada Ltd. British Columbia
Quanta Utility Installation Co., Inc. Delaware
X.X. Xxxxxxxxxxx & Co., Inc. Delaware
S.K.S. Pipeliners, LLC Delaware
Servicios Par Electric, S. de X.X. de C.V. Mexico
Southeast Pipeline Construction, Inc. Delaware
SCHEDULE I-2
SUBSIDIARY STATE OF INCORPORATION
------------- ----------------------
Southwest Trenching Company, Inc. Texas
Southwestern Communications, Inc. Delaware
Spalj Construction Company Delaware
Sumter Utilities, Inc. Delaware
The Xxxx Company, Inc. Massachusetts
Xxxxxx, L.L.C. Delaware
TNS-VA, LLC Delaware
Xxx Xxxxx Construction Company Delaware
Total Quality Management Services, LLC Delaware
Trans Tech Acquisition, Inc. Texas
Trans Tech Electric, L.P. Texas
Xxxxxxx Construction Co. Florida
TTGP, Inc. Delaware
TTLP, Inc. Delaware
TTM, Inc. North Carolina
TXLP, Inc. Delaware
Underground Construction Co., Inc. Delaware
VCI Telcom, Inc. Delaware
W.C. Communications, Inc. Delaware
W.H.O.M. Corporation California
SCHEDULE I-3
SCHEDULE II
Xxxx X. Xxxxxx
Xxxxx X. Xxxxxx
Xxxx X. Xxxxx
Xxxx X. Xxxxxx
SCHEDULE II
SCHEDULE III
Xxxxx X. Xxxx
Bernadetto X. Xxxxx
Xxxxxxx X. Xxxxxx
Xxxxxxx Xxxxx
X. Xxxxxxx Xxxxx
Xxxxx X. Xxxx
Xxxx X. Xxxxxx
Xxxxxxxx X. Xxxxxxxxxx
Xxx X. Xxxxx
Xxxxxxx X. Xxxxxx
Xxxxxx X. Xxxxxx
Xxxxx X. X'Xxxx III
Xxxxxx X. Xxxxxxxx
Xxxxxxx X. Xxxxxxx
SCHEDULE III
