__________ SHARES
CLASS A COMMON STOCK*
UNDERWRITING AGREEMENT
_______________, 1996
CS First Boston Corporation
Xxxx Xxxxxxxx Incorporated
As Representatives of the Several Underwriters,
c/o CS First Xxxxxx Xxxxxxxxxxx,
Xxxx Xxxxxx Xxxxx,
Xxx Xxxx, X.X. 00000
Dear Sirs:
1. INTRODUCTORY. RDO Equipment Co., a Delaware corporation ("COMPANY"),
proposes to issue and sell ______________ shares ("FIRM SECURITIES") of its
Class A Common Stock, par value $.01 per share ("SECURITIES") and also proposes
to issue and sell to the Underwriters, at the option of the Underwriters, an
aggregate of not more than ____________ additional shares ("OPTIONAL
SECURITIES") of its Securities as set forth below. The Firm Securities and the
Optional Securities are herein collectively called the "OFFERED SECURITIES."
Xxxxxx X. Xxxxxx (the "STOCKHOLDER") is the controlling stockholder of the
Company and it is contemplated that the Stockholder will receive a distribution
from the proceeds of the offering of the Offered Securities as described in the
Prospectus. For purposes of the representations and warranties of the Company
in this Agreement and the opinion to be delivered pursuant to Section 7(j)
hereof it is assumed that the reincorporation of the Company in Delaware has
occurred prior to the date hereof and that each of the East Texas Acquisition
and the Washington Acquisition (each of which is defined in the Registration
Statement (as hereinafter defined)) have been completed prior to the date
hereof. The Company and the Stockholder hereby agree with the several
Underwriters named in Schedule A hereto ("UNDERWRITERS") as follows:
2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY AND THE STOCKHOLDER. The
Company hereby represents and warrants to, and agrees with, the several
Underwriters that:
(a) A registration statement (No. 333-_______) relating to the
Offered Securities, including a form of prospectus, has been filed
with the Securities and Exchange Commission ("COMMISSION") and either
(i) has been declared
-----------
* Plus an option to acquire from the Company up to _______ additional shares
to cover over-allotments.
effective under the Securities Act of 1933 ("ACT") and is not proposed to
be amended or (ii) is proposed to be amended by amendment or post-effective
amendment. If such registration statement ("INITIAL REGISTRATION
STATEMENT") has been declared effective, either (i) an additional
registration statement ("ADDITIONAL REGISTRATION STATEMENT") relating to
the Offered Securities may have been filed with the Commission pursuant to
Rule 462(b) ("RULE 462(b)") under the Act and, if so filed, has become
effective upon filing pursuant to such Rule and the Offered Securities all
have been duly registered under the Act pursuant to the initial
registration statement and, if applicable, the additional registration
statement or (ii) such an additional registration statement is proposed to
be filed with the Commission pursuant to Rule 462(b) and will become
effective upon filing pursuant to such Rule and upon such filing the
Offered Securities will all have been duly registered under the Act
pursuant to the initial registration statement and such additional
registration statement. If the Company does not propose to amend the
initial registration statement or if an additional registration statement
has been filed and the Company does not propose to amend it, and if any
post-effective amendment to either such registration statement has been
filed with the Commission prior to the execution and delivery of this
Agreement, the most recent amendment (if any) to each such registration
statement has been declared effective by the Commission or has become
effective upon filing pursuant to Rule 462(c) ("RULE 462(c)") under the Act
or, in the case of the additional registration statement, Rule 462(b). For
purposes of this Agreement, "EFFECTIVE TIME" with respect to the initial
registration statement or, if filed prior to the execution and delivery of
this Agreement, the additional registration statement means (i) if the
Company has advised the Representatives that it does not propose to amend
such registration statement, the date and time as of which such
registration statement, or the most recent post-effective amendment thereto
(if any) filed prior to the execution and delivery of this Agreement, was
declared effective by the Commission or has become effective upon filing
pursuant to Rule 462(c), or (ii) if the Company has advised the
Representatives that it proposes to file an amendment or post-effective
amendment to such registration statement, the date and time as of which
such registration statement, as amended by such amendment or post-effective
amendment, as the case may be, is declared effective by the Commission. If
an additional registration statement has not been filed prior to the
execution and delivery of this Agreement but the Company has advised the
Representatives that it proposes to file one, "EFFECTIVE TIME" with respect
to such additional registration statement means the date and time as of
which such registration statement is filed and becomes effective pursuant
to Rule 462(b). "EFFECTIVE DATE" with respect to the initial registration
statement or the additional registration statement (if any) means the date
of the Effective Time thereof. The initial registration statement, as
amended at its Effective Time, including all information contained in the
additional registration statement (if any) and deemed to be a part of the
initial registration statement as of the Effective Time of the additional
registration statement pursuant to the General Instructions of the
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Form on which it is filed and including all information (if any) deemed to
be a part of the initial registration statement as of its Effective Time
pursuant to Rule 430A(b) ("RULE 430A(b)") under the Act, is hereinafter
referred to as the "INITIAL REGISTRATION STATEMENT". The additional
registration statement, as amended at its Effective Time, including the
contents of the initial registration statement incorporated by reference
therein and including all information (if any) deemed to be a part of the
additional registration statement as of its Effective Time pursuant to Rule
430A(b), is hereinafter referred to as the "ADDITIONAL REGISTRATION
STATEMENT". The Initial Registration Statement and the Additional
Registration Statement are herein referred to collectively as the
"REGISTRATION STATEMENTS" and individually as a "REGISTRATION STATEMENT".
The form of prospectus relating to the Offered Securities, as first filed
with the Commission pursuant to and in accordance with Rule 424(b) ("RULE
424(b)") under the Act or (if no such filing is required) as included in a
Registration Statement, is hereinafter referred to as the "PROSPECTUS". No
document has been or will be prepared or distributed in reliance on Rule
434 under the Act. The Commission has not issued any order preventing or
suspending the use of any preliminary prospectus, and each preliminary
prospectus has conformed in all material respects with the requirements of
the Act and the Rules and Regulations (as hereinafter defined) and, as of
its date, has not included any untrue statement of a material fact or
omitted to state a material fact required to be stated therein or necessary
to make the statements therein not misleading.
(b) If the Effective Time of the Initial Registration Statement
is prior to the execution and delivery of this Agreement: (i) on the
Effective Date of the Initial Registration Statement, the Initial
Registration Statement conformed in all respects to the requirements
of the Act and the rules and regulations of the Commission ("RULES AND
REGULATIONS") and did not include any untrue statement of a material
fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein not misleading, (ii) on
the Effective Date of the Additional Registration Statement (if any),
each Registration Statement conformed, or will conform, in all
respects to the requirements of the Act and the Rules and Regulations
and did not include, or will not include, any untrue statement of a
material fact and did not omit, or will not omit, to state any
material fact required to be stated therein or necessary to make the
statements therein not misleading and (iii) on the date of this
Agreement, the Initial Registration Statement and, if the Effective
Time of the Additional Registration Statement is prior to the
execution and delivery of this Agreement, the Additional Registration
Statement each conforms, and at the time of filing of the Prospectus
pursuant to Rule 424(b) or (if no such filing is required) at the
Effective Date of the Additional Registration Statement in which the
Prospectus is included, each Registration Statement and the Prospectus
will conform, in all respects to the requirements of the Act and the
Rules and Regulations, and neither of such documents includes, or will
include, any untrue statement of a material fact or omits, or will
omit, to state any material fact required to be stated therein
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or necessary to make the statements therein not misleading. If the
Effective Time of the Initial Registration Statement is subsequent to the
execution and delivery of this Agreement: on the Effective Date of the
Initial Registration Statement, the Initial Registration Statement and the
Prospectus will conform in all respects to the requirements of the Act and
the Rules and Regulations, neither of such documents will include any
untrue statement of a material fact or will omit to state any material fact
required to be stated therein or necessary to make the statements therein
not misleading, and no Additional Registration Statement has been or will
be filed. The two preceding sentences do not apply to statements in or
omissions from a Registration Statement or the Prospectus based upon
written information furnished to the Company by any Underwriter through the
Representatives specifically for use therein, it being understood and
agreed that the only such information is that described as such in Section
7(b) hereof.
(c) The Company has been duly incorporated and is an existing
corporation in good standing under the laws of the State of Delaware,
with power and authority (corporate and other) to own its properties
and conduct its business as described in the Prospectus; and the
Company is duly qualified to do business as a foreign corporation in
good standing in all other jurisdictions in which its ownership or
lease of property or the conduct of its business requires such
qualification, and no proceeding of which the Company has knowledge
has been instituted in any such jurisdiction, revoking, limiting or
curtailing, or seeking to revoke, limit or curtail, such power and
authority or qualification.
(d) Each subsidiary of the Company has been duly incorporated
and is an existing corporation in good standing under the laws of the
jurisdiction of its incorporation, with power and authority (corporate
and other) to own its properties and conduct its business as described
in the Prospectus; and each subsidiary of the Company is duly
qualified to do business as a foreign corporation in good standing in
all other jurisdictions in which its ownership or lease of property or
the conduct of its business requires such qualification, and no
proceeding of which the Company has knowledge has been instituted in
any such jurisdiction, revoking, limiting or curtailing, or seeking to
revoke, limit or curtail, such power and authority or qualification;
all of the issued and outstanding capital stock of each subsidiary of
the Company has been duly authorized and validly issued and is fully
paid and nonassessable; and the Company owns directly or indirectly
100% of the issued and outstanding capital stock of each subsidiary
free from liens, encumbrances and defects.
(e) The Offered Securities and all other outstanding shares of
capital stock of the Company have been duly authorized; all
outstanding shares of capital stock of the Company are, and, when the
Offered Securities have been delivered and paid for in accordance with
this Agreement on each Closing Date (as defined below), such Offered
Securities will have been, validly issued, fully paid and
nonassessable and will conform to the description
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thereof contained in the Prospectus; and the stockholders of the Company
have no preemptive rights with respect to the Securities.
(f) Except as disclosed in 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
any Underwriter for a brokerage commission, finder's fee or other like
payment.
(g) There are no contracts, agreements or understandings between
the Company and any person granting such person the right to require
the Company to file a registration statement under the Act with
respect to any securities of the Company owned or to be owned by such
person or to require the Company to include such securities in the
securities registered pursuant to a Registration Statement or in any
securities being registered pursuant to any other registration
statement filed by the Company under the Act.
(h) The Company has filed a registration statement pursuant to
Section 12(g) of Securities Exchange Act of 1934, as amended (the
"EXCHANGE ACT") to register the Class A Common Stock of the Company
thereunder. The Offered Securities have been approved for listing on
The Nasdaq Stock Market's National Market subject to notice of
issuance.
(i) No consent, approval, authorization, or order of, or filing
with, any governmental agency or body or any court is required for the
consummation of the transactions contemplated by this Agreement in
connection with the issuance and sale of the Offered Securities by the
Company, except such as have been obtained and made under the Act and
such as may be required under state securities laws.
(j) The execution, delivery and performance of this Agreement,
and the issuance and sale of the Offered Securities will not result in
a breach or violation of any of the terms and provisions of, or
constitute a default under, any statute, any rule, regulation or order
of any governmental agency or body or any court, domestic or foreign,
having jurisdiction over the Company or any subsidiary of the Company
or any of their properties, or any agreement or instrument to which
the Company or any such subsidiary is a party or by which the Company
or any such subsidiary is bound or to which any of the properties of
the Company or any such subsidiary is subject, or the charter or
by-laws of the Company or any such subsidiary, and the Company has
full power and authority to authorize, issue and sell the Offered
Securities as contemplated by this Agreement.
(k) This Agreement has been duly authorized, executed and
delivered by the Company.
(l) Except as disclosed in the Prospectus, the Company and its
subsidiaries have good and marketable title to all real properties and
all
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other properties and assets owned by them, in each case free from liens,
encumbrances and defects that would materially affect the value thereof or
materially interfere with the use made or to be made thereof by them; and
except as disclosed in the Prospectus, the Company and its subsidiaries
hold any leased real or personal property under valid and enforceable
leases with no exceptions that would materially interfere with the use made
or to be made thereof by them.
(m) The Company and its subsidiaries possess adequate
certificates, authorities or permits issued by appropriate
governmental agencies or bodies necessary to conduct the business now
operated by them and have not received any notice of proceedings
relating to the revocation or modification of any such certificate,
authority or permit that, if determined adversely to the Company or
any of its subsidiaries, would individually or in the aggregate have a
material adverse effect on the Company and its subsidiaries taken as a
whole.
(n) No labor dispute with the employees of the Company or any
subsidiary exists or, to the knowledge of the Company, is imminent
that might have a material adverse effect on the Company and its
subsidiaries taken as a whole.
(o) The Company and its subsidiaries own and possess all right,
title and interest in and to, or have duly licensed or otherwise
lawfully acquired from third parties, all trademarks, trade names and
other rights to inventions, know-how, patents, copyrights,
confidential information and other intellectual property
(collectively, "INTELLECTUAL PROPERTY RIGHTS") necessary to conduct
the business now operated by them, or presently employed by them, and
have not received any notice of infringement of or conflict with
asserted rights of others with respect to any intellectual property
rights that, if determined adversely to the Company or any of its
subsidiaries, would individually or in the aggregate have a material
adverse effect on the Company and its subsidiaries taken as a whole.
(p) Except as disclosed in the Prospectus, neither the Company
nor any of its subsidiaries is in violation of any statute, any rule,
regulation, decision or order of any governmental agency or body or
any court, domestic or foreign, relating to the use, disposal or
release of hazardous or toxic substances or relating to the protection
or restoration of the environment or human exposure to hazardous or
toxic substances (collectively, "ENVIRONMENTAL LAWS"), owns or
operates any real property contaminated with any substance that is
subject to any environmental laws, is liable for any off-site disposal
or contamination pursuant to any environmental laws, or is subject to
any claim relating to any environmental laws, which violation,
contamination, liability or claim would individually or in the
aggregate have a material adverse effect on the Company and its
subsidiaries taken as a whole; and the Company is not aware of any
pending investigation which might lead to such a claim.
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(q) Except as disclosed in the Prospectus, there are no pending
actions, suits or proceedings against or affecting the Company, any of
its subsidiaries or any of their respective properties that, if
determined adversely to the Company or any of its subsidiaries, would
individually or in the aggregate have a material adverse effect on the
condition (financial or other), business, properties or results of
operations of the Company and its subsidiaries taken as a whole, or
would materially and adversely affect the ability of the Company to
perform its obligations under this Agreement, or which are otherwise
material in the context of the sale of the Offered Securities; and no
such actions, suits or proceedings are threatened or, to the Company's
knowledge, contemplated.
(r) The accountants who have expressed their opinions with
respect to certain of the financial statements and schedules included
in the Registration Statement are independent accountants as required
by the Act.
(s) The consolidated financial statements included in each
Registration Statement and the Prospectus present fairly the financial
position of the Company and its consolidated subsidiaries as of the
dates shown and their results of operations and cash flows for the
periods shown, and such financial statements have been prepared in
conformity with the generally accepted accounting principles in the
United States applied on a consistent basis; the schedules (if any)
included in each Registration Statement present fairly the information
required to be stated therein; the financial information set forth in
the Prospectus under "Summary Combined and Pro Forma Financial and
Operating Date" and "Selected Combined and Pro Forma Financial and
Operating Data" presents fairly, on the basis stated in each
Registration Statement and the Prospectus, the information set forth
therein; the pro forma financial information included in each
Registration Statement and the Prospectus presents fairly the
information shown therein and has been prepared in accordance with
generally accepted accounting principles in the United States and the
Commission's rules and guidelines with respect to pro forma
information; and the assumptions used in preparing the pro forma
financial statements included in each Registration Statement and the
Prospectus provide a reasonable basis for presenting the significant
effects directly attributable to the transactions or events described
therein, the related pro forma adjustments give appropriate effect to
those assumptions, and the pro forma columns therein reflect the
proper application of those adjustments to the corresponding
historical financial statement amounts.
(t) Except as disclosed in the Prospectus, since the date of the
latest audited financial statements included in the Prospectus there
has been no material adverse change, nor any development or event
involving a prospective material adverse change, in the condition
(financial or other), business, properties or results of operations of
the Company and its subsidiaries taken as a whole, and, except as
disclosed in or contemplated by
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the Prospectus, there has been no dividend or distribution of any kind
declared, paid or made by the Company on any class of its capital stock.
(u) The Company is not and, after giving effect to the offering
and sale of the Offered Securities and the application of the proceeds
thereof as described in the Prospectus, will not be an "investment
company" as defined in the Investment Company Act of 1940.
(v) Neither the Company nor any of its affiliates does business
with the government of Cuba or with any person or affiliate located in
Cuba within the meaning of Section 517.075, Florida Statutes and the
Company agrees to comply with such Section if prior to the completion
of the distribution of the Offered Securities it commences doing such
business.
(w) Neither the Company nor any subsidiary is in violation of
its charter or in default under any consent decree, or in default with
respect to any material provision of any lease, loan agreement,
franchise, license, permit or other contract obligation to which it is
a party; and, to the Company's knowledge, there does not exist any
state of facts which constitutes an event of default as defined in
such documents or which, with notice or lapse of time or both, would
constitute such an event of default, in each case, except for defaults
which neither singly nor in the aggregate are material to the Company
and its subsidiaries taken as a whole.
(x) The Company has not taken and will not take, directly or
indirectly, any action designed to or which has constituted or which
might reasonably be expected to cause or result, under the Exchange
Act or otherwise, in stabilization or manipulation of the price of any
security of the Company to facilitate the sale or resale of the
Offered Securities.
(y) The conduct of the business of the Company and each of its
subsidiaries is in compliance in all respects with applicable federal,
state, local and foreign laws and regulations, except where the failure
to be in compliance would not have a material adverse effect upon the
condition (financial or otherwise) or results of operations of the
Company and its subsidiaries taken as a whole.
(z) All offers and sales of the Company's capital stock prior to
the date hereof were at all relevant times exempt from the registration
requirements of the Act and were duty registered with or the subject of
an available exemption from the registration requirements of the
applicable state securities or blue sky laws.
(aa) The Company and each of its subsidiaries maintains reasonably
adequate insurance.
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(ab) There are no outstanding subscriptions, rights, warrants,
options, calls, convertible securities, commitments of sale or liens
related to or entitling any person to purchase or otherwise to acquire
any shares of the capital stock of, or other ownership interest in, the
Company or any subsidiary thereof except as otherwise disclosed in the
Registration Statement.
(ac) Except as disclosed in the Prospectus, there are no business
relationships or related party transactions required to be disclosed
therein by Item 404 of Regulation S-K of the Commission.
(ad) The Company has filed all necessary federal and state income
and franchise tax returns and has paid all taxes shown as due thereon,
and there is no tax deficiency that has been, or to the knowledge of the
Company might be, asserted against the Company or any of its properties
or assets that would or could be expected to have a material adverse
affect upon the condition (financial or otherwise) or results of
operations of the Company and its subsidiaries taken as a whole, other
than any such taxes as are being contested in good faith.
(ae) The Company and all of the currently existing stockholders of
the Company have made a valid election pursuant to Section 1362(a) of
the Code of to be an "S corporation" within the meaning of Section
1361(a)(1) of the Code for all taxable periods beginning after November
1, 1989; the Company is, and since November 1, 1989 has been an S
corporation, and no event has occurred since the date of the filing of
the election to be an S corporation that would result in a termination
of such election; the Company has no federal corporate income tax
liability for the period from November 1, 1989 to the termination of the
election to be an S corporation which will occur on the First Closing Date.
(af) The Company had or has all corporate power and authority to
carry out the following transactions described in the Prospectus (i) the
Central Texas Acquisition, East Texas Acquisition and Washington
Acquisition, and (ii) the reincorporation of the Company in Delaware,
and the Company, has taken all action required by law, the Company's
charter and bylaws or otherwise to approve each of the foregoing.
(ag) The consummation of the Central Texas Acquisition, East Texas
Acquisition and Washington Acquisition and the reincorporation of the
Company in Delaware did not or will not contravene any provision of
applicable law or the charter or bylaws of the Company, any provision of
any material agreement or other material instrument binding upon the
Company or any order, writ, injunction or decree of any jurisdiction,
court or governmental body, and no consent, approval, authorization or
order of any court or governmental agency or body is or was required in
connection with each of the foregoing, except such as have been obtained.
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3. REPRESENTATIONS AND WARRANTIES OF THE STOCKHOLDER.
(a) The Stockholder represents and warrants to, and agrees with, the
Underwriters to the same effect as the representations and warranties of the
Company set forth in Section 2 of this Agreement.
(b) The Stockholder has full right, power and authority to enter into
this Agreement.
4. PURCHASE, SALE AND DELIVERY OF OFFERED SECURITIES. On the basis
of the representations, warranties and agreements herein contained, but subject
to the terms and conditions herein set forth, the Company agrees to sell to the
Underwriters, and the Underwriters agree, severally and not jointly, to purchase
from the Company, at a purchase price of $__________ per share, the respective
numbers of shares of Firm Securities set forth opposite the names of the
Underwriters in Schedule A hereto.
The Company will deliver the Firm Securities to the Representatives
for the accounts of the Underwriters at the office of _______________, against
payment of the purchase price in funds available on the same day by wire
transfer to the account of the Company at a bank acceptable to CS First Boston
Corporation ("CS FIRST BOSTON") or by official Federal Reserve Bank check drawn
to the order of the Company at the office of __________ at 9:00 a.m. New York
time, on the fourth business day, if permitted under Rule 15c6-1 under the
Exchange Act (or the third business day if required under Rule 15c6-1 under the
Exchange Act or unless postponed in accordance with the provisions of Section 9
hereof) following the date the Registration Statement is declared effective by
the Commission (or, if the Company has elected to rely on Rule 430A, the fourth
business day, if permitted under Rule 15c6-1 under the Exchange Act (or the
third business day if required under Rule 15c6-1 under the Exchange Act) after
execution of this Agreement), or at such other time not later than seven full
business days thereafter as CS First Boston and the Company may determine, such
time being referred to as the "FIRST CLOSING DATE". The certificates for the
Firm Securities so to be delivered will be in definitive form, in such
denominations and registered in such names as CS First Boston requests and will
be made available for checking and packaging at office of _______________ at
least 24 hours prior to the First Closing Date.
In addition, upon written notice from CS First Boston given to the
Company from time to time not more than 30 days subsequent to the date of the
Prospectus, the Underwriters may purchase all or less than all of the Optional
Securities at the purchase price per Security to be paid for the Firm
Securities. The Company agrees to sell to the Underwriters the number of shares
of Optional Securities specified in such notice and the Underwriters agree,
severally and not jointly, to purchase such Optional Securities. Such Optional
Securities shall be purchased for the account of each Underwriter in the same
proportion as the number of shares of Firm Securities set forth opposite such
Underwriter's name bears to the total number of shares of Firm Securities
(subject to adjustment by CS First Boston to eliminate fractions) and may be
purchased by the Underwriters only for the purpose of covering over-allotments
made in connection with the sale of the Firm Securities. No Optional Securities
shall be sold or delivered unless the Firm Securities
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previously have been, or simultaneously are, sold and delivered. The right to
purchase the Optional Securities or any portion thereof may be exercised from
time to time and to the extent not previously exercised may be surrendered and
terminated at any time upon notice by CS First Boston to the Company.
Each time for the delivery of and payment for the Optional Securities,
being herein referred to as an "OPTIONAL CLOSING DATE", which may be the First
Closing Date (the First Closing Date and each Optional Closing Date, if any,
being sometimes referred to as a "CLOSING DATE"), shall be determined by CS
First Boston but shall be not later than five full business days after written
notice of election to purchase Optional Securities is given. The manner of
payment for and delivery of the Option Securities shall be the same as for the
Firm Securities as specified above. The certificates for the Optional
Securities being purchased on each Optional Closing Date will be in definitive
form, in such denominations and registered in such names as CS First Boston
requests upon reasonable notice prior to such Optional Closing Date and will be
made available for checking and packaging at the office of ______________ at a
reasonable time in advance of such Optional Closing Date.
5. OFFERING BY UNDERWRITERS. It is understood that the several
Underwriters propose to offer the Offered Securities for sale to the public as
set forth in the Prospectus.
6. CERTAIN AGREEMENTS OF THE COMPANY. The Company agrees with the
several Underwriters that:
(a) If the Effective Time of the Initial Registration
Statement is prior to the execution and delivery of this
Agreement, the Company will file the Prospectus with the
Commission pursuant to and in accordance with subparagraph
(1) (or, if applicable and if consented to by CS First
Boston, subparagraph (4)) of Rule 424(b) not later than the
earlier of (A) the second business day following the
execution and delivery of this Agreement or (B) the
fifteenth business day after the Effective Date of the
Initial Registration Statement.
The Company will advise CS First Boston promptly of any such
filing pursuant to Rule 424(b). If the Effective Time of
the Initial Registration Statement is prior to the execution
and delivery of this Agreement and an additional
registration statement is necessary to register a portion of
the Offered Securities under the Act but the Effective Time
thereof has not occurred as of such execution and delivery,
the Company will file the additional registration statement
or, if filed, will file a post-effective amendment thereto
with the Commission pursuant to and in accordance with Rule 462(b)
on or prior to 10:00 P.M., New York time, on the date
of this Agreement or, if earlier, on or prior to the time
the Prospectus is printed and distributed to any
Underwriter, or will make such filing at such later date as
shall have been consented to by CS First Boston.
(b) The Company will advise CS First Boston promptly
of any proposal to amend or supplement the initial or any
additional registration
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statement as filed or the related prospectus or the
Initial Registration Statement, the Additional
Registration Statement (if any) or the Prospectus and
will not effect such amendment or supplementation without
CS First Boston's consent; and the Company will also
advise CS First Boston promptly of the effectiveness of
each Registration Statement (if its Effective Time is
subsequent to the execution and delivery of this
Agreement) and of any amendment or supplementation of a
Registration Statement or the Prospectus and of the
institution by the Commission of any stop order
proceedings in respect of a Registration Statement and
will use its best efforts to prevent the issuance of any
such stop order and to obtain as soon as possible its
lifting, if issued.
(c) If, at any time when a prospectus relating to
the Offered Securities is required to be delivered under
the Act in connection with sales by any Underwriter or
dealer, any event occurs as a result of which the
Prospectus as then amended or supplemented would include
an untrue statement of a material fact or omit to state
any material fact necessary to make the statements
therein, in the light of the circumstances under which
they were made, not misleading, or if it is necessary at
any time to amend the Prospectus to comply with the Act,
the Company will promptly notify CS First Boston of such
event and will promptly prepare and file with the
Commission, at its own expense, an amendment or
supplement which will correct such statement or omission
or an amendment which will effect such compliance.
Neither CS First Boston's consent to, nor the
Underwriters' delivery of, any such amendment or
supplement shall constitute a waiver of any of the
conditions set forth in Section 7.
(d) As soon as practicable, but not later than the
Availability Date (as defined below), the Company will
make generally available to its securityholders an
earnings statement covering a period of at least 12
months beginning after the Effective Date of the Initial
Registration Statement (or, if later, the Effective Date
of the Additional Registration Statement) which will
satisfy the provisions of Section 11(a) of the Act. For
the purpose of the preceding sentence, "Availability
Date" means the 45th day after the end of the fourth
fiscal quarter following the fiscal quarter that includes
such Effective Date, except that, if such fourth fiscal
quarter is the last quarter of the Company's fiscal year,
"Availability Date" means the 90th day after the end of
such fourth fiscal quarter.
(e) The Company will furnish to the Representatives
copies of each Registration Statement (three of which
will be signed and will include all exhibits), each
related preliminary prospectus, and, so long as delivery
of a prospectus relating to the Offered Securities is
required to be delivered under the Act in connection with
sales by any Underwriter or dealer, the Prospectus and
all amendments and supplements to such documents, in each
case in such quantities as CS First Boston requests. The
Prospectus shall be so furnished on or prior to 3:00
P.M., New York time, on the business day following the
- 12 -
later of the execution and delivery of this Agreement or
the Effective Time of the Initial Registration Statement.
All other documents shall be so furnished as soon as
available. The Company will pay the expenses of printing
and distributing to the Underwriters all such documents.
(f) The Company will arrange for the qualification
of the Offered Securities for sale under the laws of such
jurisdictions as CS First Boston designates and will
continue such qualifications in effect so long as
required for the distribution.
(g) During the period of five years hereafter, the
Company will furnish to the Representatives and, upon
request, to each of the other Underwriters, as soon as
practicable after the end of each fiscal year, a copy of
its annual report to stockholders for such year; and the
Company will furnish to the Representatives (i) as soon
as available, a copy of each report and any definitive
proxy statement of the Company filed with the Commission
under the Exchange Act or mailed to stockholders, and
(ii) from time to time, such other information concerning
the Company as CS First Boston may reasonably request.
(h) The Company will pay all expenses incident to
the performance of its obligations under this Agreement
and will reimburse the Underwriters (if and to the extent
incurred by them) for any filing fees and other expenses
(including fees and disbursements of counsel) incurred by
them in connection with qualification of the Offered
Securities for sale under the laws of such jurisdictions
as CS First Boston designates and the printing of
memoranda relating thereto, for the filing fee incident
to, and the reasonable fees and disbursements of counsel
to the Underwriters in connection with the review by the
National Association of Securities Dealers, Inc. of the
Offered Securities, for any travel expenses of the
Company's officers and employees and any other expenses
of the Company in connection with attending or hosting
meetings with prospective purchasers of the Offered
Securities and for expenses incurred in distributing
preliminary prospectuses and the Prospectus (including
any amendments and supplements thereto) to the Underwriters.
(i) For a period of 180 days after the date of the
initial public offering of the Offered Securities, the
Company will not offer, sell, contract to sell, pledge or
otherwise dispose of, directly or indirectly, or file
with the Commission a registration statement under the
Act relating to, any additional shares of its Securities
or securities convertible into or exchangeable or
exercisable for any shares of its Securities, or publicly
disclose the intention to make any such offer, sale,
pledge, disposal or filing, without the prior written
consent of CS First Boston, except grants of employee
stock options pursuant to the terms of a plan in effect
on the date hereof, issuances of Securities pursuant to
the exercise of such options or the exercise of any other
employee stock options outstanding on the date hereof.
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(j) Neither the Company nor any of its subsidiaries
will, prior to the earlier of the Second Closing Date or
termination or expiration of the related option, incur any
liability or obligation, direct or contingent or enter into
any material transaction, other than in the ordinary course
of business, except as contemplated by the Prospectus.
(k) Neither the Company nor any of its subsidiaries
will acquire any capital stock of the Company prior to the
earlier of the Second Closing Date or termination or
expiration of the related option nor will the Company
declare or pay any dividend or make any other distribution
upon the Class A Common Stock payable to stockholders of
record on a date prior to the earlier of the Second Closing
Date or termination or expiration of the related option,
except in either case as contemplated by the Prospectus.
(l) The Company will use the net proceeds received by
it from the sale of the Offered Securities being sold by it
in the manner specified in the Prospectus.
7. CONDITIONS OF THE OBLIGATIONS OF THE UNDERWRITERS. The
obligations of the several Underwriters to purchase and pay for the Firm
Securities on the First Closing Date and the Optional Securities to be purchased
on each Optional Closing Date will be subject to the accuracy of the
representations and warranties on the part of the Company herein, to the
accuracy of the statements of Company officers made pursuant to the provisions
hereof, to the performance by the Company of its obligations hereunder and to
the following additional conditions precedent:
(a) The Representatives shall have received a letter,
dated the date of delivery thereof (which, if the Effective
Time of the Initial Registration Statement is prior to the
execution and delivery of this Agreement, shall be on or
prior to the date of this Agreement or, if the Effective
Time of the Initial Registration Statement is subsequent to
the execution and delivery of this Agreement, shall be prior
to the filing of the amendment or post-effective amendment
to the registration statement to be filed shortly prior to
such Effective Time), of Xxxxxx Xxxxxxxx LLP confirming that
they are independent public accountants within the meaning
of the Act and the applicable published Rules and
Regulations thereunder and stating to the effect that:
(i) in their opinion the financial
statements and schedules (if any) examined by them
and included or incorporated by reference in the
Registration Statements comply as to form in all
material respects with the applicable accounting
requirements of the Act and the related published
Rules and Regulations;
(ii) they have performed the procedures
specified by the American Institute of Certified
Public Accountants for a review
- 14 -
of interim financial information as described in
Statement of Auditing Standards No. 71, Interim
Financial Information, on the unaudited financial
statements included in the Registration Statements;
(iii) on the basis of the review referred to
in clause (ii) above, a reading of the latest
available interim financial statements of the
Company, inquiries of officials of the Company who
have responsibility for financial and accounting
matters and other specified procedures, nothing
came to their attention that caused them to
believe that:
(A) the unaudited financial
statements included in the Registration
Statements do not comply as to form in
all material respects with the
applicable accounting requirements of
the Act and the related published Rules
and Regulations or any material
modifications should be made to such
unaudited financial statements for them
to be in conformity with generally
accepted accounting principles;
(B) at the date of the latest
available balance sheet read by such
accountants, or at a subsequent
specified date not more than three days
prior to the date of this Agreement,
there was any change in the capital
stock or any increase in short-term
indebtedness or long-term debt of the
Company and its consolidated
subsidiaries or, at the date of the
latest available balance sheet read by
such accountants, there was any decrease
in consolidated net current assets or
net assets, as compared with amounts
shown on the latest balance sheet
included in the Prospectus; or
(C) for the period from the
closing date of the latest income
statement included in the Prospectus to
the closing date of the latest available
income statement read by such
accountants there were any decreases, as
compared with the corresponding period
of the previous year and with the period
of corresponding length ended the date
of the latest income statement included
in the Prospectus, in consolidated total
revenues or operating income,
-15-
or in the total or per share amounts of
net income.
except in all cases set forth in clauses (B)
and (C) above for changes, increases or decreases
which the Prospectus discloses have occurred or
may occur or which are described in such letter;
(iv) they have compared specified dollar
amounts (or percentages derived from such dollar
amounts) and other financial information contained
in the Registration Statements (in each case to
the extent that such dollar amounts, percentages
and other financial information are derived from
the general accounting records of the Company and
its subsidiaries subject to the internal controls
of the Company's accounting system or are derived
directly from such records by analysis or
computation) with the results obtained from
inquiries, a reading of such general accounting
records and other procedures specified in such
letter and have found such dollar amounts,
percentages and other financial information to be
in agreement with such results, except as
otherwise specified in such letter;
(v) with respect to the pro forma financial
information included in the Registration
Statement, they have performed the procedures
specified by the American Institute of Certified
Public Accountants Statement on Standards for
Attestation Engagements No. 1, "Reporting on Pro
Forma Financial Statements"; and
(vi) on the basis of the procedures referred
to in clause (v) above, inquiries of officials of
the Company who have responsibility for financial
and accounting matters and other specified
procedures, nothing came to their attention that
caused them to believe that the pro forma
financial information and statements included in
the Registration Statements do not comply as to
form in all material respects with the applicable
accounting requirements of the Act and the related
published Rules and Regulations or any material
modifications should be made to such pro forma
financial information and statements for them to
be in accordance with such requirements and
generally accepted accounting principles.
(b) The Representatives shall have received a letter,
dated the date of delivery thereof (which, if the Effective
Time of the Initial Registration Statement is prior to the
execution and delivery of this Agreement, shall be on or
prior to the date of this Agreement or, if the Effective
Time of the
- 16 -
Initial Registration Statement is subsequent to the execution
and delivery of this Agreement, shall be prior to the filing
of the amendment or post-effective amendment to the
registration statement to be filed shortly prior to such
Effective Time), of Xxxx Helmeke PLLP. confirming that they
are independent public accountants within the meaning of the
Act and the applicable published Rules and Regulations
thereunder and stating to the effect that:
(i) in their opinion the financial
statements and schedules (if any) examined by them
and included or incorporated by reference in the
Registration Statements comply as to form in all
material respects with the applicable accounting
requirements of the Act and the related published
Rules and Regulations;
(ii) they have performed the procedures
specified by the American Institute of Certified
Public Accountants for a review of interim
financial information as described in Statement of
Auditing Standards No. 71, Interim Financial
Information, on the unaudited financial statements
included in the Registration Statements;
(iii) on the basis of the review referred to
in clause (ii) above, a reading of the latest
available interim financial statements of the
Company, inquiries of officials of the Company who
have responsibility for financial and accounting
matters and other specified procedures, nothing
came to their attention that caused them to
believe that:
(A) the unaudited financial
statements included in the Registration
Statements do not comply as to form in
all material respects with the
applicable accounting requirements of
the Act and the related published Rules
and Regulations or any material
modifications should be made to such
unaudited financial statements for them
to be in conformity with generally
accepted accounting principles;
(B) at the date of the latest
available balance sheet read by such
accountants, or at a subsequent
specified date not more than three days
prior to the date of this Agreement,
there was any change in the capital
stock or any increase in short-term
indebtedness or long-term debt of the
Company and its consolidated
subsidiaries or, at the date of the
latest available
- 17 -
balance sheet read by such accountants,
there was any decrease in consolidated
net current assets or net assets, as
compared with amounts shown on the latest
balance sheet included in the Prospectus;
or
(C) for the period from the
closing date of the latest income
statement included in the Prospectus to
the closing date of the latest available
income statement read by such
accountants there were any decreases, as
compared with the corresponding period
of the previous year and with the period
of corresponding length ended the date
of the latest income statement included
in the Prospectus, in consolidated total
revenues or operating income, or in the
total or per share amounts of net
income.
except in all cases set forth in clauses (B)
and (C) above for changes, increases or decreases
which the Prospectus discloses have occurred or
may occur or which are described in such letter;
and
(iv) they have compared specified dollar
amounts (or percentages derived from such dollar
amounts) and other financial information contained
in the Registration Statements (in each case to
the extent that such dollar amounts, percentages
and other financial information are derived from
the general accounting records of the Company and
its subsidiaries subject to the internal controls
of the Company's accounting system or are derived
directly from such records by analysis or
computation) with the results obtained from
inquiries, a reading of such general accounting
records and other procedures specified in such
letter and have found such dollar amounts,
percentages and other financial information to be
in agreement with such results, except as
otherwise specified in such letter.
(c) The Representatives shall have received a letter,
dated the date of delivery thereof (which, if the Effective
Time of the Initial Registration Statement is prior to the
execution and delivery of this Agreement, shall be on or
prior to the date of this Agreement or, if the Effective
Time of the Initial Registration Statement is subsequent to
the execution and delivery of this Agreement, shall be prior
to the filing of the amendment or post-effective amendment
to the registration statement to be filed shortly prior to
such Effective Time), of Xxxxxx Xxxxx & Co. confirming that
they are
- 18 -
independent public accountants within the meaning of the
Act and the applicable published Rules and Regulations
thereunder and stating to the effect that:
(i) in their opinion the financial
statements and schedules (if any) examined by them
and included or incorporated by reference in the
Registration Statements comply as to form in all
material respects with the applicable accounting
requirements of the Act and the related published
Rules and Regulations;
(ii) they have performed the procedures
specified by the American Institute of Certified
Public Accountants for a review of interim
financial information as described in Statement of
Auditing Standards No. 71, Interim Financial
Information, on the unaudited financial statements
included in the Registration Statements;
(iii) on the basis of the review referred to
in clause (ii) above, a reading of the latest
available interim financial statements of Mega
Equipment Co. ("MEGA"), inquiries of officials of
the Mega who have responsibility for financial and
accounting matters and other specified procedures,
nothing came to their attention that caused them
to believe that:
(A) the unaudited financial
statements included in the Registration
Statements do not comply as to form in
all material respects with the
applicable accounting requirements of
the Act and the related published Rules
and Regulations or any material
modifications should be made to such
unaudited financial statements for them
to be in conformity with generally
accepted accounting principles;
(B) at the date of the latest
available balance sheet read by such
accountants, or at a subsequent
specified date not more than three days
prior to the date of this Agreement,
there was any change in the capital
stock or any increase in short-term
indebtedness or long-term debt of Mega
and its consolidated subsidiaries or, at
the date of the latest available balance
sheet read by such accountants, there
was any decrease in consolidated net
current assets or net assets, as
compared with amounts shown on the
latest balance sheet included in the
Prospectus; or
- 19 -
(C) for the period from the
closing date of the latest income
statement included in the Prospectus to
the closing date of the latest available
income statement read by such
accountants there were any decreases, as
compared with the corresponding period
of the previous year and with the period
of corresponding length ended the date
of the latest income statement included
in the Prospectus, in consolidated total
revenues or operating income, or in the
total or per share amounts of net
income.
except in all cases set forth in clauses (B)
and (C) above for changes, increases or decreases
which the Prospectus discloses have occurred or
may occur or which are described in such letter;
and
(iv) they have compared specified dollar
amounts (or percentages derived from such dollar
amounts) and other financial information contained
in the Registration Statements (in each case to
the extent that such dollar amounts, percentages
and other financial information are derived from
the general accounting records of Mega and its
subsidiaries subject to the internal controls of
Mega's accounting system or are derived directly
from such records by analysis or computation) with
the results obtained from inquiries, a reading of
such general accounting records and other
procedures specified in such letter and have found
such dollar amounts, percentages and other
financial information to be in agreement with such
results, except as otherwise specified in such
letter.
For purposes of this subsection, (i) if the Effective Time of the
Initial Registration Statement is subsequent to the execution and delivery of
this Agreement, "Registration Statements" shall mean the initial registration
statement as proposed to be amended by the amendment or post-effective amendment
to be filed shortly prior to its Effective Time, (ii) if the Effective Time of
the Initial Registration Statement is prior to the execution and delivery of
this Agreement but the Effective Time of the Additional Registration is
subsequent to such execution and delivery, "Registration Statements" shall mean
the Initial Registration Statement and the additional registration statement as
proposed to be filed or as proposed to be amended by the post-effective
amendment to be filed shortly prior to its Effective Time, and (iii)
"Prospectus" shall mean the prospectus included in the Registration Statements.
(d) If the Effective Time of the Initial Registration
Statement is not prior to the execution and delivery of this
Agreement, such Effective Time
- 20 -
shall have occurred not later than 10:00 P.M., New York time, on the
date of this Agreement or such later date as shall have been consented
to by CS First Boston. If the Effective Time of the Additional
Registration Statement (if any) is not prior to the execution and
delivery of this Agreement, such Effective Time shall have occurred
not later than 10:00 P.M., New York time, on the date of this
Agreement or, if earlier, the time the Prospectus is printed and
distributed to any Underwriter, or shall have occurred at such later
date as shall have been consented to by CS First Boston. If the
Effective Time of the Initial Registration Statement is prior to the
execution and delivery of this Agreement, the Prospectus shall have
been filed with the Commission in accordance with the Rules and
Regulations and Section 5(a) of this Agreement. Prior to such Closing
Date, no stop order suspending the effectiveness of a Registration
Statement shall have been issued and no proceedings for that purpose
shall have been instituted or, to the knowledge of the Company or the
Representatives, shall be contemplated by the Commission.
(e) Subsequent to the execution and delivery of this
Agreement, there shall not have occurred (i) 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 or its subsidiaries
which, in the judgment of a majority in interest of the
Underwriters including the Representatives, 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 Offered Securities; (ii) any downgrading in
the rating of any debt securities of the Company by any
"nationally recognized statistical rating organization" (as
defined for purposes of Rule 436(g) under the Act), or any
public announcement that any such organization has under
surveillance or review its rating of any debt securities of
the Company (other than an announcement with positive
implications of a possible upgrading, and no implication of
a possible downgrading, of such rating); (iii) any
suspension or limitation of trading in securities generally
on the New York Stock Exchange, or any setting of minimum
prices for trading on such exchange, or any suspension of
trading of any securities of the Company on any exchange or
in the over-the-counter market; (iv) any banking moratorium
declared by U.S. Federal or, New York or authorities; or (v)
any outbreak or escalation of major hostilities in which the
United States is involved, any declaration of war by
Congress or any other substantial national or international
calamity or emergency if, in the judgment of a majority in
interest of the Underwriters including the Representatives,
the effect of any such outbreak, escalation, declaration,
calamity or emergency makes it impractical or inadvisable to
proceed with completion of the public offering or the sale
of and payment for the Offered Securities.
(f) The Shares shall have been qualified for sale
under the blue sky laws of such states as shall have been
specified by the Representatives.
- 21 -
(g) The legality and sufficiency of the authorization,
issuance and sale or transfer and sale of the Offered
Securities hereunder, the validity and form of the
certificates representing the Offered Securities, the
execution and delivery of this Agreement, and all corporate
proceedings and other legal matters incident thereto, and
the form of the Registration Statement and the Prospectus
(except financial statements) shall have been approved by
counsel for the Underwriters exercising reasonable judgment.
(h) You shall not have advised the Company that the
Registration Statement or the Prospectus or any amendment or
supplement thereto, contains an untrue statement of fact,
which, in the opinion of counsel for the Underwriters, is
material or omits to state a fact which, in the opinion of
such counsel, is material and is required to be stated
therein or necessary to make the statements therein not
misleading.
(i) The East Texas Acquisition and Washington
Acquisition shall have been completed on or prior to the
First Closing Date.
(j) The Representatives shall have received an
opinion, dated such Closing Date, of Xxxxxxxxxxx, Xxxxx &
Donnelley, counsel for the Company, to the effect that:
(i) The Company has been duly incorporated
and is an existing corporation in good standing
under the laws of the State of Delaware, with
corporate power and authority to own its
properties and conduct its business as described
in the Prospectus; and the Company is duly
qualified to do business as a foreign corporation
in good standing in all other jurisdictions in
which its ownership or lease of property or the
conduct of its business requires such
qualification;
(ii) An opinion to the same general effect
as clause (i) in respect of each subsidiary of the
Company;
(iii) All of the issued and outstanding
capital stock of each subsidiary of the Company
has been duly authorized, validly issued and is
fully paid and nonassessable, and, except as
disclosed in the Registration Statement, the
Company owns directly or indirectly 100% of the
outstanding capital stock of each subsidiary, and
to the knowledge of such counsel, such stock is
owned free and clear of any claims, liens,
encumbrances or security interests;
(iv) The authorized capital stock of the
Company, of which there is outstanding the amount
set forth in the Registration Statement and
Prospectus (except for subsequent issuances, if
any, pursuant to stock options or other rights
- 22 -
referred to in the Prospectus), conforms as to legal matters in
all material respects to the description thereof in the
Registration Statement and Prospectus;
(v) The certificates for the Offered
Securities to be delivered hereunder are in due
and proper form, and when duly countersigned by
the Company's transfer agent and delivered to you
or upon your order against payment of the agreed
consideration therefor in accordance with the
provisions of this Agreement, the Offered
Securities represented thereby will be duly
authorized and validly issued, fully paid and
nonassessable;
(vi) The Offered Securities delivered on
such Closing Date and all other outstanding shares
of the capital stock of the Company have been duly
authorized and validly issued, are fully paid and
nonassessable and conform to the description
thereof contained in the Prospectus; and the
stockholders of the Company have no preemptive
rights with respect to the Securities;
(vii) There are no contracts, agreements or
understandings known to such counsel between the
Company and any person granting such person the
right to require the Company to file a
registration statement under the Act with respect
to any securities of the Company owned or to be
owned by such person or to require the Company to
include such securities in the securities
registered pursuant to the Registration Statement
or in any securities being registered pursuant to
any other registration statement filed by the
Company under the Act;
(viii) The Company is not and, after giving
effect to the offering and sale of the Offered
Securities and the application of the proceeds
thereof as described in the Prospectus, will not
be an "investment company" as defined in the
Investment Company Act of 1940;
(ix) No consent, approval, authorization or
order of, or filing with, any governmental agency
or body or any court is required for the
consummation of the transactions contemplated by
this Agreement in connection with the issuance or
sale of the Offered Securities by the Company,
except such as have been obtained and made under
the Act and such as may be required under state
securities laws;
- 23 -
(x) This Agreement has been duly authorized,
executed and delivered by the Company;
(xi) This Agreement constitutes the legal,
valid and binding agreements of the Company,
except as enforceability of the same may be
limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting
creditors' rights and by the exercise of judicial
discretion in accordance with general principles
applicable to equitable and similar remedies and
except as to those provisions relating to
indemnities and contribution for liabilities
arising under the Act as to which no opinion need
be expressed;
(xii) The execution, delivery and
performance of this Agreement and the issuance and
sale of the Offered Securities will not result in
a breach or violation of any of the terms and
provisions of, or constitute a default under, any
statute, any rule, regulation or order of any
governmental agency or body or any court having
jurisdiction over the Company or any subsidiary of
the Company or any of their properties, or any
agreement or instrument to which the Company or
any such subsidiary is a party or by which the
Company or any such subsidiary is bound or to
which any of the properties of the Company or any
such subsidiary is subject, or the charter or
by-laws of the Company or any such subsidiary, and
the Company has full power and authority to
authorize, issue and sell the Offered Securities
as contemplated by this Agreement;
(xiii) Neither the Company nor any of its
subsidiaries is in violation of its respective
charter or by-laws to the best of such counsel's
knowledge after due inquiry, neither the Company
nor any of its subsidiaries is in default in the
performance of any obligation, agreement or
condition contained in any bond, debenture, note
or any other evidence of indebtedness or in any
other agreement, indenture or instrument material
to the conduct of the business of the Company and
its subsidiaries, taken as a whole, to which the
Company or any of its subsidiaries is a party or
by which it or any of its subsidiaries or their
respective property is bound;
(xiv) The descriptions in the Registration
Statement of laws, regulations and rules, of legal
and governmental proceedings and of contracts,
agreements, leases and other documents including,
without limitation, under the headings "Risk
Factors-Dependence upon Xxxx Deere," "-Deere
Termination Rights," "-Risks Associated with
Expansion," "-Anti-takeover Measures; Possible
Issuances of Preferred
- 24 -
Stock," "-S Corporation Distributions," "Business-Recent
Acquisitions," "-Dealership Agreements," "-Floor Plan Financing,"
"-Customer Financing Options," "Management - 1996 Stock Incentive
Plan," "-Cash Bonus Incentive Plan," "-401(k) Employee Benefit
Plan," "-Limitation of Liability and Indemnification of Officers
and Directors," "Certain Relationships and Related Transactions,"
"Description of Capital Stock" and "Shares Eligible for Future
Sale" have been reviewed by such counsel and are accurate in all
material respects, and comply as to form in all material respects
with the applicable requirements of the Act and the rules and
regulations thereunder;
(xv) To the best of such counsel's
knowledge, all offers and sales of the Company's
capital stock prior to the date hereof were at all
relevant times exempt from the registration
requirements of the Act and were duly registered
or the subject of an available exemption from the
registration requirements of the applicable state
securities or blue sky laws;
(xvi) After due inquiry, such counsel does
not know of any legal or governmental proceeding
pending or threatened to which the Company or any
of its subsidiaries is a party or to which any of
their respective property is subject which is
required to be described in the Registration
Statement or the Prospectus and is not so
described, or of any contract or other document
which is required to be described in the
Registration Statement or the Prospectus or is
required to be filed as an exhibit to the
Registration Statement which is not described or
filed as required;
(xvii) To the best of such counsel's
knowledge, after due inquiry, except as otherwise
set forth in the Prospectus all leases to which
the Company or any of its subsidiaries is a party
are valid and binding and no default has occurred
or is continuing thereunder, which might result in
any material adverse change in the business,
prospects, financial condition or results of
operations of the Company and its subsidiaries
taken as a whole, and the Company and its
subsidiaries enjoy peaceful and undisturbed
possession under all such leases to which any of
them is a party as lessee with such exceptions as
do not materially interfere with the use made by
the Company or such subsidiary;
(xviii) The distribution that the
Stockholder will receive from the proceeds of the
offering of the Offered Securities as described in
the Prospectus has been duly authorized by all
- 25 -
necessary corporation action and such distribution will not
contravene any of the provisions of, or result in a default
under, any agreement, franchise, license, indenture, mortgage,
deed of trust, or other agreement or instrument known to such
counsel, of the Company or by which the property of the Company
is bound and which contravention or default would be material to
the Company; or violate any of the provisions of the charter or
bylaws of the Company, or violate any statute, order, rule or
regulation of any regulatory or governmental body having
jurisdiction over the Company;
(xix) With respect to the Stockholder this
Agreement has been duly authorized, executed and
delivered by or on behalf of the Stockholder and
the performance of this Agreement and the
consummation of the transactions herein
contemplated by the Stockholder will not result in
a breach or violation of any of the terms and
provisions of, or constitute a default under, any
statute, any indenture, mortgage, deed of trust,
note agreement or other agreement or instrument
known to such counsel to which the Stockholder is
a party or by which he is bound or to which any of
the property of the Stockholder is subject, or any
order, rule or regulation known to such counsel of
any court or governmental agency or body having
jurisdiction over the Stockholder or any of his
properties;
(xx) The distribution that the Stockholder
will receive from the proceeds of the offering of
the Offered Securities as described in the
Prospectus has been duly authorized by all
necessary corporate action and such distribution
will not contravene any of the provisions of, or
result in a default under, any agreement,
franchise, license, indenture, mortgage, deed of
trust, or other agreement or instrument known to
such counsel, of the Company or by which the
property of the Company is bound and which
contravention or default would be material to the
Company, or violate any of the provisions of the
charter or bylaws of the Company, or so far as it
is known to such counsel, violate any statute,
order, rule or regulation of any regulatory or
governmental body having jurisdiction over the
Company;
(xxi) The Stockholder has full right, power
and authority to enter into this Agreement;
(xxii) This Agreement is the legal, valid
and binding agreement of the Stockholder except as
enforceability of the same may be limited by
bankruptcy, insolvency, reorganization, moratorium
or other similar laws affecting creditors' rights
and
- 26 -
by the exercise of judicial discretion in accordance
with general principles applicable to equitable and
similar remedies and except with respect to those
provisions relating to indemnities for liabilities
arising under the Act, as to which no opinion need
be expressed;
(xxiii) The Company has all corporate power
and authority to carry out the Central Texas
Acquisition, East Texas Acquisition and Washington
Acquisition and the reincorporation of the Company
in Delaware, and the Company has taken all action
required by law, the Company's charter and bylaws
or otherwise to approve each of the foregoing;
(xxiv) The consummation of the Central Texas
Acquisition, East Texas Acquisition, Washington
Acquisition and the reincorporation of the Company
in Delaware did not or will not contravene any
provision of applicable law or the charter or
bylaws of the Company, except to the extent the
Company has obtained the requisite consent, any
provision of any material agreement or other
material instrument binding upon the Company, or
any order, writ, injunction or decree of any
jurisdiction, court or governmental body, and no
consent, approval, authorization or order of any
court or governmental agency or body is or was
required in connection with the Central Texas
Acquisition, East Texas Acquisition or Washington
Acquisition, except such as have been obtained;
and
(xxv) The Initial Registration Statement was
declared effective under the Act as of the date
and time specified in such opinion, the Additional
Registration Statement (if any) was filed and
became effective under the Act as of the date and
time (if determinable) specified in such opinion,
the Prospectus either was filed with the
Commission pursuant to the subparagraph of Rule
424(b) specified in such opinion on the date
specified therein or was included in the Initial
Registration Statement or the Additional
Registration Statement (as the case may be), and,
to the best of the knowledge of such counsel, no
stop order suspending the effectiveness of a
Registration Statement or any part thereof has
been issued and no proceedings for that purpose
have been instituted or are pending or
contemplated under the Act, and each Registration
Statement and the Prospectus, and each amendment
or supplement thereto, as of their respective
effective or issue dates, complied as to form in
all material respects with the requirements of the
Act and the Rules and
- 27 -
Regulations; such counsel have no reason to believe
that any part of a Registration Statement or any
amendment thereto, as of its effective date or as of
such Closing Date, contained any untrue statement of
a material fact or omitted to state any material
fact required to be stated therein or necessary to
make the statements therein not misleading or that
the Prospectus or any amendment or supplement
thereto, as of its issue date or as of such Closing
Date, contained any untrue statement of a material
fact or omitted to state any material fact necessary
in order to make the statements therein, in the
light of the circumstances under which they were
made, not misleading; the descriptions in the
Registration Statements and Prospectus of statutes,
legal and governmental proceedings and contracts and
other documents are accurate and fairly present the
information required to be shown; and such counsel
do not know of any legal or governmental proceedings
required to be described in a Registration Statement
or the Prospectus which are not described as required
or of any contracts or documents of a character
required to be described in a Registration Statement
or the Prospectus or to be filed as exhibits to a
Registration Statement which are not described and
filed as required; it being understood that such
counsel need express no opinion as to the financial
statements or other financial data contained in the
Registration Statements or the Prospectus.
(k) The Representatives shall have received from
XxXxxxxxx, Will & Xxxxx, counsel for the Underwriters, such
opinion or opinions, dated such Closing Date, with respect
to the incorporation of the Company, the validity of the
Offered Securities delivered on such Closing Date, the
Registration Statements, the Prospectus and other related
matters as the Representatives may require, and the Company
shall have furnished to such counsel such documents as they
request for the purpose of enabling them to pass upon such
matters.
(l) The Representatives shall have received a
certificate, dated such Closing Date, of the President or
any Vice-President and a principal financial or accounting
officer of the Company in which such officers, to the best
of their knowledge after reasonable investigation, shall
state that: the representations and warranties of the
Company in this Agreement are true and correct; the Company
has complied with all agreements and satisfied all
conditions on its part to be performed or satisfied
hereunder at or prior to such Closing Date; no stop order
suspending the effectiveness of any Registration Statement
has been issued and no proceedings for that purpose have
been instituted or are contemplated by the Commission; the
Additional Registration Statement (if any) satisfying the
requirements of subparagraphs (1) and (3) of Rule 462(b) was
filed pursuant to Rule 462(b), including payment of the
applicable filing fee in accordance with Rule 111(a) or (b)
- 28 -
under the Act, prior to the time the Prospectus was printed
and distributed to any Underwriter; and, subsequent to the
dates of the most recent financial statements in the
Prospectus, there has been no material adverse change,
nor any development or event involving a prospective
material adverse change, in the condition (financial or
other), business, properties or results of operations of
the Company and its subsidiaries taken as a whole except
as set forth in or contemplated by the Prospectus or as
described in such certificate.
(m) The Representatives shall have received letters,
dated such Closing Date, from each of Xxxxxx Xxxxxxxx, LLP,
Xxxx Helmeke PLLP and Xxxxxx, Xxxxx & Co. which meets the
requirements of subsection (a), (b) or (c) of this Section,
as the case may be, except that the specified date referred
to in such subsection will be a date not more than three
days prior to such Closing Date for the purposes of this
subsection.
(n) On the First Closing Date a letter from each
stockholder and executive officer of the Company, in which
each such person agrees not to sell, contract to sell or
otherwise dispose of any Class A Common Stock or securities
convertible into Common Stock (except Class A Common Stock
issued pursuant to currently outstanding options) for a
period of 180 days after the date of such letter without the
prior written consent of CS First Boston.
(o) Such further information, certificates and
documents as you may reasonably request.
(p) A certificate of the Stockholder dated such
Closing Date, as the case may be, to the effect that the
representations and warranties of the Stockholder set forth
in Section 3 of this Agreement are true and correct as of
such Closing Date.
The Company will furnish the Representatives with such conformed copies of such
opinions, certificates, letters and documents as the Representatives reasonably
requests. CS First Boston may in its sole discretion waive on behalf of the
Underwriters compliance with any conditions to the obligations of the
Underwriters hereunder, whether in respect of an Optional Closing Date or
otherwise.
8. INDEMNIFICATION AND CONTRIBUTION.
(a) The Company will indemnify and hold harmless each
Underwriter against any losses, claims, damages or
liabilities, joint or several, to which such Underwriter may
become subject, under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon any untrue
statement or alleged untrue statement of any material fact
contained in any Registration Statement, the Prospectus, or
any amendment or supplement thereto, or any related
preliminary prospectus, or arise out of or are based upon
the omission or
- 29 -
alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements
therein not misleading, and will reimburse each Underwriter
for any legal or other expenses reasonably incurred by such
Underwriter in connection with investigating or defending any such
loss, claim, damage, liability or action as such expenses are
incurred; provided, however, that the Company will not be liable in
any such case to the extent that any such loss, claim, damage or
liability arises out of or is based upon an untrue statement or
alleged untrue statement in or omission or alleged omission from any
of such documents in reliance upon and in conformity with written
information furnished to the Company by any Underwriter through the
Representatives specifically for use therein, it being understood and
agreed that the only such information furnished by any Underwriter
consists of the information described as such in subsection (c) below.
(b) The Stockholder will indemnify and hold harmless
each Underwriter against any losses, claims, damages or
liabilities, joint or several, to which such Underwriter may
become subject, under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon any untrue
statement or alleged untrue statement of any material fact
contained in any Registration Statement, the Prospectus, or
any amendment or supplement thereto, or any related
preliminary prospectus, or arise out of or are based upon
the omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the
statements therein not misleading, and will reimburse each
Underwriter for any legal or other expenses reasonably
incurred by such Underwriter in connection with
investigating or defending any such loss, claim, damage,
liability or action as such expenses are incurred; provided,
however, that the Stockholder will not be liable in any such
case to the extent that any such loss, claim, damage or
liability arises out of or is based upon an untrue statement
or alleged untrue statement in or omission or alleged
omission from any of such documents in reliance upon and in
conformity with written information furnished to the Company
by any Underwriter through the Representatives specifically
for use therein, it being understood and agreed that the
only such information furnished by any Underwriter consists
of the information described as such in subsection (c)
below.
Without limiting the full extent of the Company's
agreement to indemnify each Underwriter, as herein provided,
the Stockholder shall be liable under the indemnity
agreements contained in paragraph (b) of this Section only
for an amount not exceeding $[15.0] million, the amount of
the S Corporation distribution to be received by the
Stockholder from the net proceeds of the Offered Securities,
plus the amount of the retained earnings paid to the
Stockholder from February 1, 1996 through the First Closing
Date, in the form of a dividend or distribution all of which
is set forth in the Prospectus.
- 30 -
(c) Each Underwriter will severally and not jointly
indemnify and hold harmless the Company and the Stockholder
against any losses, claims, damages or liabilities to which
the Company or the Stockholder may become subject, under the
Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or
are based upon any untrue statement or alleged untrue
statement of any material fact contained in any Registration
Statement, the Prospectus, or any amendment or supplement
thereto, or any related preliminary prospectus, or arise out
of or are based upon the omission or the alleged omission to
state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading,
in each case to the extent, but only to the extent, that
such untrue statement or alleged untrue statement or
omission or alleged omission was made in reliance upon and
in conformity with written information furnished to the
Company by such Underwriter through the Representatives
specifically for use therein, and will reimburse any legal
or other expenses reasonably incurred by the Company and the
Stockholder in connection with investigating or defending
any such loss, claim, damage, liability or action as such
expenses are incurred, it being understood and agreed that
the only such information furnished by any Underwriter
consists of the following information in the Prospectus
furnished on behalf of each Underwriter: the last paragraph
at the bottom of the cover page concerning the terms of the
offering by the Underwriters, the legend concerning
over-allotments and, stabilizing on the inside front cover
page and, the concession and reallowance figures appearing
in the paragraph under the caption "Underwriting" and the
information contained in the _____ and _____ paragraphs
under the caption "Underwriting"
(d) Promptly after receipt by an indemnified party
under this Section of notice of the commencement of any
action, such indemnified party will, if a claim in respect
thereof is to be made against the indemnifying party under
subsection (a), (b) or (c) above, notify the indemnifying
party of the commencement thereof; but the omission so to
notify the indemnifying party will not relieve it from any
liability which it may have to any indemnified party
otherwise than under subsection (a), (b) or (c) above. In
case any such action is brought against any indemnified
party and it notifies the indemnifying party of the
commencement thereof, the indemnifying party will be
entitled to participate therein and, to the extent that it
may wish, jointly with any other indemnifying party
similarly notified, to assume the defense thereof, with
counsel satisfactory to such indemnified party (who shall
not, except with the consent of the indemnified party, be
counsel to the indemnifying party), and after notice from
the indemnifying party to such indemnified party of its
election so to assume the defense thereof, the indemnifying
party will not be liable to such indemnified party under
this Section for any legal or other expenses subsequently
incurred by such indemnified party in connection with the
defense thereof other than reasonable costs of
investigation. No indemnifying party shall, without the
prior written consent of the indemnified party, effect any
settlement of any
- 31 -
pending or threatened action in respect of which any indemnified party
is or could have been a party and indemnity could have been sought
hereunder by such indemnified party unless such settlement includes an
unconditional release of such indemnified party from all liability on
any claims that are the subject matter of such action.
(e) If the indemnification provided for in this Section is
unavailable or insufficient to hold harmless an indemnified party
under subsection (a), (b) or (c) above, then each indemnifying party
shall contribute to the amount paid or payable by such indemnified
party as a result of the losses, claims, damages or liabilities
referred to in subsection (a), (b) or (c) above (i) in such proportion
as is appropriate to reflect the relative benefits received by the
Company and the Stockholder on the one hand and the Underwriters on
the other from the offering of the Securities or (ii) if the
allocation provided by clause (i) above is not permitted by applicable
law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) above but also the
relative fault of the Company and the Stockholder on the one hand and
the Underwriters on the other in connection with the statements or
omissions which resulted in such losses, claims, damages or
liabilities as well as any other relevant equitable considerations.
The relative benefits received by the Company and the Stockholder on
the one hand and the Underwriters on the other shall be deemed to be
in the same proportion as the total net proceeds from the offering
(before deducting expenses) received by the Company and the
Stockholder bear to the total underwriting discounts and commissions
received by the Underwriters. The relative fault shall be determined
by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by
the Company, the Stockholder or the Underwriters and the parties'
relative intent, knowledge, access to information and opportunity to
correct or prevent such untrue statement or omission. The amount paid
by an indemnified party as a result of the losses, claims, damages or
liabilities referred to in the first sentence of this subsection (e)
shall be deemed to include any legal or other expenses reasonably
incurred by such indemnified party in connection with investigating or
defending any action or claim which is the subject of this
subsection (e). Notwithstanding the provisions of this
subsection (e), no Underwriter shall be required to contribute any
amount in excess of the amount by which the total price at which the
Securities underwritten by it and distributed to the public were
offered to the public exceeds the amount of any damages which such
Underwriter has otherwise been required to pay by reason of such
untrue or alleged untrue statement or omission or alleged omission.
No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation.
The Underwriters' obligations in this subsection (e) to contribute are
several in proportion to their respective underwriting obligations and
not joint.
- 32 -
(f) The obligations of the Company and the Stockholder
under this Section shall be in addition to any liability
which the Company and the Stockholder may otherwise have and
shall extend, upon the same terms and conditions, to each
person, if any, who controls any Underwriter within the
meaning of the Act; and the obligations of the Underwriters
under this Section shall be in addition to any liability
which the respective Underwriters may otherwise have and
shall extend, upon the same terms and conditions, to each
director of the Company, to each officer of the Company who
has signed a Registration Statement and to each person, if
any, who controls the Company within the meaning of the Act.
9. DEFAULT OF UNDERWRITERS. If any Underwriter or Underwriters
default in their obligations to purchase Offered Securities hereunder on either
the First or any Optional Closing Date and the aggregate number of shares of
Offered Securities that such defaulting Underwriter or Underwriters agreed but
failed to purchase does not exceed 10% of the total number of shares of Offered
Securities that the Underwriters are obligated to purchase on such Closing Date,
CS First Boston may make arrangements satisfactory to the Company for the
purchase of such Offered Securities by other persons, including any of the
Underwriters, but if no such arrangements are made by such Closing Date, the
non-defaulting Underwriters shall be obligated severally, in proportion to their
respective commitments hereunder, to purchase the Offered Securities that such
defaulting Underwriters agreed but failed to purchase on such Closing Date. If
any Underwriter or Underwriters so default and the aggregate number of shares of
Offered Securities with respect to which such default or defaults occur exceeds
10% of the total number of shares of Offered Securities that the Underwriters
are obligated to purchase on such Closing Date and arrangements satisfactory to
CS First Boston and the Company for the purchase of such Offered Securities by
other persons are not made within 36 hours after such default, this Agreement
will terminate without liability on the part of any non-defaulting Underwriter
or the Company, except as provided in Section 10 (provided that if such default
occurs with respect to Optional Securities after the First Closing Date, this
Agreement will not terminate as to the Firm Securities or any Optional
Securities purchased prior to such termination). As used in this Agreement, the
term "Underwriter" includes any person substituted for an Underwriter under this
Section. Nothing herein will relieve a defaulting Underwriter from liability
for its default.
10. SURVIVAL OF CERTAIN REPRESENTATIONS AND OBLIGATIONS. The
respective indemnities, agreements, representations, warranties and other
statements of the Stockholder, of the Company or its officers and of the several
Underwriters set forth in or made pursuant to this Agreement will remain in full
force and effect, regardless of any investigation, or statement as to the
results thereof, made by or on behalf of any Underwriter, the Stockholder, the
Company or any of their respective representatives, officers or directors or any
controlling person, and will survive delivery of and payment for the Offered
Securities. If this Agreement is terminated pursuant to Section 9 or if for any
reason the purchase of the Offered Securities by the Underwriters is not
consummated, the Company shall remain responsible for the expenses to be paid or
reimbursed by it pursuant to Section 6 and the respective obligations of the
Company, the Stockholder and the Underwriters pursuant to Section 8 shall remain
in effect, and if any Offered Securities have been
- 33 -
purchased hereunder the representations and warranties in Section 2 and all
obligations under Section 6 shall also remain in effect. If the purchase of the
Offered Securities by the Underwriters is not consummated for any reason other
than solely because of the termination of this Agreement pursuant to Section 9
or the occurrence of any event specified in clause (iii), (iv) or (v) of Section
7(e), the Company and the Stockholder will, jointly and severally, reimburse the
Underwriters for all out-of-pocket expenses (including fees and disbursements of
counsel) reasonably incurred by them in connection with the offering of the
Offered Securities.
11. NOTICES. All communications hereunder will be in writing and, if
sent to the Underwriters, will be mailed, delivered or telegraphed and confirmed
to the Representatives, c/o CS First Boston Corporation, Park Avenue Plaza, New
York, N.Y. 10055, Attention: Investment Banking Department--Transactions
Advisory Group, or, if sent to the Company or the Stockholder, will be mailed,
delivered or telegraphed and confirmed to it at 00000 Xxxxx Xxxxxxxxxx Xxxxx,
Xxxxx, Xxxxx Xxxxxx 00000, Attention: President; provided, however, that any
notice to an Underwriter pursuant to Section 8 will be mailed, delivered or
telegraphed and confirmed to such Underwriter.
12. SUCCESSORS. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective successors and the officers
and directors and controlling persons referred to in Section 8, and no other
person will have any right or obligation hereunder.
13. REPRESENTATION OF UNDERWRITERS. The Representatives will act for
the several Underwriters in connection with this financing, and any action under
this Agreement taken by the Representatives jointly or by CS First Boston will
be binding upon all the Underwriters.
14. 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 Agreement.
15. APPLICABLE LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD
TO PRINCIPLES OF CONFLICTS OF LAWS.
The Company hereby submits to the non-exclusive jurisdiction of the
Federal and state courts in the Borough of Manhattan in The City of New York in
any suit or proceeding arising out of or relating to this Agreement or the
transactions contemplated hereby.
* * *
- 34 -
If the foregoing is in accordance with the Representative's
understanding of our agreement, kindly sign and return to the Company one of the
counterparts hereof, whereupon it will become a binding agreement among the
Company, the Stockholder and the several Underwriters in accordance with its
terms.
Very truly yours,
RDO EQUIPMENT CO.
By:
----------------------------------------
Its:
---------------------------------------
---------------------------------------------
Xxxxxx X. Xxxxxx
The foregoing Underwriting Agreement
is hereby confirmed and accepted as
of the date first above written.
CS First Boston Corporation
Xxxx Xxxxxxxx Incorporation
Acting on behalf of themselves and as the
Representatives of the several Underwriters.
By CS First Boston Corporation
By:
--------------------
Its:
-----------------------
- 35 -
SCHEDULE A
Number of
Underwriter Firm Securities
----------- ---------------
CS First Boston Corporation. . . . . . . . . . . .
Xxxx Xxxxxxxx Incorporated . . . . . . . . . . . .
---------------
Total . . . . . . . . . . . . . . . .
---------------
---------------
