Exhibit 1.1
Draft
UNDERWRITING AGREEMENT
THIS UNDERWRITING AGREEMENT (this "Agreement") is entered into as of
________, 1998, among Marine Shuttle Operations Inc., a Nevada corporation
(the "Company"), and Berliner Effektenbank AG, a German corporation ("BEB").
Background
The Company proposes to issue and sell through BEB 20,000,000 shares
(the "Securities") of its common stock par value $ 0.001 per share ("Common
Stock") on a "best efforts, all-or-none" basis (the "Offering").
In furtherance of the foregoing, the Company and BEB hereby agree as
follows:
Section 1
Sale of Securities
The Company proposes to issue and sell the Securities to the public
through BEB, as underwriter, at an offering price of US$_______ per share in
consideration for which the Company shall pay BEB, at the Closing (as defined
below), a commission equal to ten percent ( 10 %) of the aggregate purchase
price of the Securities.
Section 2
Payment and Delivery
2.1. The Company hereby appoints BEB as its exclusive agent (subject
to BEB's right to designate selected dealers who may participate in the
Offering) for a period (the "Offering Period") of thirty (30) days from the
date on which the Registration Statement (as hereinafter defined) becomes
effective (the "Effective Date"), to sell the Securities on a "best-efforts,
all-or-none" basis; provided however, the Company and BEB, by their mutual
written consent, may extend the Offering Period for an additional period of
up to thirty (30) days. An additional five (5) days may be added solely for
the
purpose of allowing checks to clear. The Company and BEB, at any time, may
agree to terminate the Offering prior to the end of the Offering Period. BEB,
on the basis of the representations and warranties contained herein, and
subject to the terms and conditions set forth herein, accepts such
appointment and agrees to use its best efforts to find purchasers for the
Securities. BEB, as agent for the Company, shall offer the shares of Common
Stock to the public at a price of US$ _______ per share. If, at or prior to
the end of the Offering Period, subscriptions are received aggregating more
than the Securities, then BEB in its sole and absolute discretion, may
allocate the Securities among the subscribers in such manner as it shall see
fit.
2.2 Until all of the Securities have been subscribed and paid for,
all subscription amounts shall be deposited no later than noon on the
business day next following their receipt by BEB or any participating
Selected Dealer (as hereinafter defined), directly into a separate account
(the "Escrow Account") to be held by BEB in escrow as agent for the
subscribers. All such subscription amounts shall be held in the Escrow
Account until disbursed as hereinafter provided.
2.3 Promptly after the Effective Date, (i) the Company shall deliver
to its transfer agent (the "Transfer Agent") certificates which will be used
to represent the Securities to be sold hereunder through BEB; and (ii) the
Company shall instruct the Transfer Agent to deliver a certificate evidencing
the Securities (or shall electronically transfer evidence of the Securities)
to Depositary Trust Company for deposit into the account of BEB's clearing
firm for the benefit of BEB on the Closing Date.
2.4 If all of the Securities are not sold within the Offering
Period, this Agreement automatically shall terminate, the Securities held by
BEB shall be returned to the Transfer Agent, and all amounts in the Escrow
Account promptly shall be returned to the subscribers without interest
thereon or deduction therefrom.
2.5 If all of the Securities have been subscribed for and payment
therefor has been tendered prior to the expiration of the Offering Period,
BEB promptly shall give written notice (the "Notice") to the Company and the
Transfer Agent so indicating and setting forth (i) the amount of BEB's
commission, (ii) the time and date (which date shall be no later than
sixty-five (65) days after the Effective Date) on which the closing (the
"Closing") shall take place (the "Closing Date"), and (iii) a
2
written statement reflecting each subscription which identifies, among other
things, the name and address of each subscriber, the number of Securities
allocated to each subscriber, the amount tendered as payment therefor, and,
if the provisions of Section 2.7 below are applicable, the amount equal to
the aggregate price of that number of Securities for which such subscription
its not being accepted. The Closing shall take place at the offices of BEB,
▇▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, or at such other place as BEB and
the Company shall agree.
2.6 At the Closing, (i) BEB shall deliver and remit to the Company
from the Escrow Account the purchase price of such Securities, less BEB's
commission, and (ii) the Company shall instruct Depositary Trust Company to
deposit the Securities into the account of BEB's clearing firm for the
benefit of BEB. Upon receipt of the Securities, BEB shall deliver to each
purchaser certificates representing the Securities sold to each purchaser (or
shall electronically transfer evidence of ownership to each such purchaser).
2.7 If, prior to the end of the Offering Period, subscriptions are
received aggregating more than the Securities, then (i) BEB, in its sole and
absolute discretion, may allocate the Securities among the subscribers in
such manner as it shall see fit, and (ii) BEB shall remit to those
subscribers whose subscriptions are not being accepted, in whole or in part,
an amount of money equal to the price of that number of Securities for which
such subscription is not being accepted.
Section 3
Offering of the Securities on Behalf of the Company
3.1. In offering the Securities for sale, BEB shall offer the
Securities solely as agent for the Company, and such offering shall be made
upon the terms and subject to the conditions set forth in the Registration
Statement and Prospectus (each as hereinafter defined). BEB shall commence
offering the Securities for sale as agent for the Company as soon after the
Effective Date as BEB may deem advisable; provided, however, if BEB does not
commence such offering within three (3) business days after the Effective
Date, it promptly shall so advise the Company and the Securities and Exchange
Commission (the "Commission").
3
3.2. In accordance with the applicable provisions of the
Registration Statement (as hereinafter defined) and this Agreement, BEB may
offer and sell the Securities for the account of the Company through
registered dealers selected by BEB (the "Selected Dealers"), and may allow
such concessions (out of the underwriting commission) to the Selected Dealers
as BEB may determine. All sales by Selected Dealers shall be on behalf of the
Company. BEB shall have the authority to appoint Selected Dealers as agents
for the Company; provided, however, no Selected Dealer shall be appointed by
BEB unless such Selected Dealer has duly executed and delivered to BEB a
Selected Dealers Agreement in the form filed as an exhibit to the
Registration Statement. In no event shall Selected Dealers be agents or
sub-agents of BEB. Except as herein provided, the Company shall not appoint
any other agents in offering the Securities for sale.
3.3. BEB represents, warrants, and covenants that, as part of the
distribution of the Securities, it has not offered or sold, and will not,
offer, sell, or deliver, directly or indirectly, any of the Securities or
distribute any prospectus relating to the offering of the Securities within
the United States or to any U.S. Person (as defined below). In addition, BEB
has agreed that it will offer to sell Securities only in compliance with all
relevant requirements of any applicable laws. As used herein, the term "U.S.
Person" means any resident or national of the United States, any corporation,
partnership, or other entity created or organized in or under the laws of the
United States, or any estate or trust the income of which is subject to
United States income taxation regardless of the source of its income (other
than the foreign branch of any U.S. Person), and includes any United States
branch of a person other than a U.S. Person.
3.4. BEB agrees that (i) it will not offer or sell any Securities to
persons in the United Kingdom except to persons whose ordinary activities
involve them in acquiring, holding, managing or disposing of investments (as
principal or agent) for the purpose of their businesses or otherwise in
circumstances which will not involve an offer to the public in the United
Kingdom within the meaning of the Public Offers of the Securities Regulations
1995 ("the Regulations"); (ii) it will comply with all applicable provisions
of the Financial Services ▇▇▇ ▇▇▇▇ and the Regulations with respect to
anything done by it in relation to the Securities in, from, or otherwise
involving the United Kingdom; and (iii) it will only issue or pass on to any
person in the United Kingdom any document received by it in connection with
the offer of the Securities if that person is of a kind described in Article
11(3) of
4
the Financial Services ▇▇▇ ▇▇▇▇ (Investment Advertisements) (Exemption) Order
1996 or is a person to whom such document may otherwise lawfully be issued or
passed on.
Section 4
Representations and Warranties of the Company.
The Company represents and warrants to, and agrees with that:
4.1. A registration statement (File No. 333-58465) on Form S-1
relating to the Offering, including a form of prospectus subject to
completion, copies of which have heretofore been delivered to BEB has been
prepared by the Company in conformity with the requirements of the Securities
Act of 1933, as amended (the "Act"), and the rules and regulations
promulgated thereunder by the Commission (the "Rules and Regulations"), and
has been filed with the Commission under the Act. In addition, one or more
amendments to such registration statement may have been so filed. After the
execution of this Agreement, (i) if the Commission has declared such
registration statement (as it may have been amended) to be effective under
the Act, then the Company, if required, will file with the Commission a
prospectus in the form most recently included in an amendment to such
registration statement (or, if no such amendment shall have been filed, in
such registration statement), with such changes or insertions as are required
by Rule 430A under the Act or permitted by Rule 424(b) under the Act, and as
has been furnished to and approved by BEB prior to the execution of this
Agreement; or (ii) if the Commission has not declared such registration
statement (as it may have been amended) to be effective under the Act, then
the Company will file with the Commission an amendment to such registration
statement, including a form of prospectus, a copy of which amendment has been
furnished to and approved by BEB prior to the execution of this Agreement. As
used in this Agreement, the term "Registration Statement" means such
registration statement, as amended at the time when it was or is declared
effective, including all financial schedules and exhibits thereto, and
including any information omitted therefrom pursuant to Rule 430A under the
Act and included in the Prospectus (as defined below); the term "Preliminary
Prospectus" means each prospectus subject to completion, filed with such
registration statement or any amendment thereto (including the prospectus
subject to completion, if any, included in the Registration Statement or any
amendment thereto at the time it was or is declared effective); and the term
"Prospectus" means the prospectus first filed with the Commission pursuant to
Rule 424(b) under the Act, or, if no prospectus is required to be filed pursu-
5
ant to said Rule 424(b), such term means the Prospectus included in the
Registration Statement; except that if such registration statement or
prospectus is amended or such prospectus is supplemented after the effective
date of such registration statement and prior to the Closing Date, then the
term "Registration Statement" shall include such registration statement as so
amended, and the term "Prospectus" shall include such prospectus as so
amended or supplemented, or both, as the case may be.
4.2. The Commission has not issued any order preventing or
suspending the use of any Preliminary Prospectus.
4.3. The Company and its subsidiaries, Marine Shuttle Operation AS
and Offshore Shuttle AS (collectively, "Subsidiaries"), each has been duly
incorporated and is validly existing as a corporation in good standing under
the laws of the jurisdiction of its incorporation, with full power and
authority (corporate and other) to own or lease its properties and to conduct
its business as described in the Prospectus, and is duly qualified to do
business as a foreign corporation and is in good standing as a foreign
corporation in all other jurisdictions in which the nature of its businesses
or the character or location of its properties requires such qualification,
except where failure to so qualify will not materially affect the Company's
business, properties, or financial condition.
4.4. The authorized, issued, and outstanding capital stock of the
Company as of March 31, 1998 is as set forth in the Prospectus under the
heading "Capitalization", and the shares of issued and outstanding capital
stock of the Company set forth thereunder have been duly authorized, validly
issued, and are fully paid and non-assessable. Except as set forth in the
Prospectus, no options, warrants, or other rights to purchase, agreements or
other obligations to issue, or agreements or other rights to convert any
obligation into, any shares of capital stock of the Company have been granted
or entered into by the Company. The capital stock of the Company conforms to
all statements relating thereto contained in the Registration Statement and
Prospectus.
4.5. The Securities are duly authorized, and when issued, delivered,
and paid for pursuant to this Agreement, shall be validly issued, fully paid
and non-assessable, and free of pre-emptive rights of any security holder of
the Company. Except as described in the Registration Statement, neither the
filing of the Registration Statement nor the offering or sale of the
Securities as contemplated
6
by this Agreement gives rise to any rights, other than those which have been
waived or satisfied, for or relating to the registration of the sale or
transfer of any shares of Common Stock.
4.6. This Agreement has been duly and validly authorized, executed,
and delivered by the Company. The Company has full power and lawful authority
to authorize, issue, and sell the Securities to be sold by it hereunder on
the terms and conditions set forth herein. No consent, approval,
authorization, or other order of any governmental authority is required in
connection with the authorization, execution, and delivery of this Agreement
or with the authorization, issuance, and sale of the Securities, except as
may be required under the Act or state securities laws.
4.7. Except as described in the Prospectus, (i) neither the Company
nor its Subsidiaries are in violation, breach, or default of or under, and
the consummation of the transactions herein contemplated and the fulfilment
of the terms of this Agreement shall not conflict with or result in a breach
or violation of any of the terms or provisions of, or constitute a default
under, or result in the creation or imposition of any lien, charge, or
encumbrance upon any of the property or assets of the Company or its
Subsidiaries pursuant to the terms of, any indenture, mortgage, deed of
trust, loan agreement, or other agreement or instrument to which the Company
or its Subsidiaries are a party or by which the Company or its Subsidiaries
may be bound or to which any of the property or assets of the Company or its
Subsidiaries is subject; and (ii) the consummation of the transactions
contemplated herein and the fulfilment of the terms of this Agreement shall
not result in any violation of the provisions of the articles of
incorporation or the by-laws of the Company or its Subsidiaries, or any
statute, or any applicable order, rule, or regulation of any court,
regulatory authority, or other governmental body having jurisdiction over the
Company or its Subsidiaries.
4.8. Subject to the qualifications stated in the Prospectus, the
Company and its Subsidiaries have good and marketable title to all properties
and assets described in the Prospectus as owned by them, free and clear of
all liens, charges, encumbrances, or restrictions, except such as are not
materially significant or important in relation to their business. All of the
material leases and subleases under which the Company or its Subsidiaries are
the lessor or sublessor of properties or assets, or under which the Company
or its Subsidiaries hold properties or assets as lessee or sublessee as
described in the Prospectus, are in full force and effect; except as
described in the Prospectus, neither the Company nor its Subsidiaries are in
default in any material respect with respect to any of the terms or pro-
7
visions of any of such leases or subleases, and no claim has been asserted by
anyone adverse to the rights of the Company or its Subsidiaries as lessor,
sublessor, lessee, or sublease under any of such leases or subleases; and the
Company or its Subsidiaries owns or leases all such properties described in
the Prospectus as are necessary to its operations as now conducted and,
except as otherwise stated in the Prospectus, as proposed to be conducted as
set forth in the Prospectus.
4.9. Deloitte & Touche, LLP has given its reports on certain
financial statements filed and to be filed with the Commission as a part of
the Registration Statement which are incorporated in the Prospectus; with
respect to the Company and its Subsidiaries, Deloitte & Touche, LLP is an
independent public accounting firm as required by the Act and the Rules and
Regulations.
4.10. The financial statements, together with related notes and
schedules, if any, set forth in the Prospectus and the Registration Statement
fairly present the financial position and results of operations and changes
in cash flow position of the Company and its Subsidiaries on the basis stated
in the Registration Statement at the respective dates and for the respective
periods to which they apply. Said statements and related notes and schedules
have been prepared in accordance with generally accepted accounting
principles applied on a basis which is consistent during the periods involved.
4.11. Subsequent to the respective dates as of which information is
given in the Registration Statement and Prospectus, and except as set forth
in or contemplated by the Prospectus (i) neither the Company nor its
Subsidiaries have incurred any liabilities or obligations, direct or
contingent, not in the ordinary course of business, or entered into any
transaction not in the ordinary course of business, which is material to the
business of the Company or its Subsidiaries; (ii) there has not been any
change in the capital stock of the Company or its Subsidiaries, any
incurrence of short-term or long-term debt by the Company or its
Subsidiaries, any issuance of options, warrants, or other rights to purchase
the capital stock of the Company or its Subsidiaries, or any adverse change
or any development involving, so far as the Company can now reasonably
foresee, a prospective adverse change in the condition (financial or other),
net worth, results of operations, business, key personnel or properties of
the Company or its Subsidiaries which would be material to the business or
financial condition of the Company; and (iii) neither the Company nor its
Subsidiaries have become a party to, and neither the business nor the
property of the Company or its Subsidiaries have become the subject of, any
material litigation, whether or not in the ordinary of business.
8
4.12. Except as set forth in the Prospectus, there is not now
pending or threatened any action, suit, or proceeding in which the Company or
its Subsidiaries is a party, before or by any court or governmental agency or
body, which might result in any material adverse change in the condition
(financial or other), business, net worth, or properties of the Company or
its Subsidiaries, nor are there any pending or threatened actions, suits, or
proceedings related to environmental matters or discrimination on the basis
of age, sex, religion, or race; and no labour disputes involving the
employees of the Company or its Subsidiaries exist or are imminent which
might be expected to adversely affect the conduct of the business, property,
or operations of the Company or its Subsidiaries or the financial condition
or results of operations of the Company or its Subsidiaries.
4.13. Except as disclosed in the Prospectus, the Company and its
Subsidiaries have sufficient licenses, permits, and other governmental
authorizations currently required for the conduct of their business or the
ownership of their properties as described in the Prospectus and are in all
material respects complying therewith. In addition, except as otherwise
described in the Prospectus, the Company and its Subsidiaries own or possess
adequate rights to use all material patents, patent applications, trademarks,
service marks, trade-names, trademark registrations, service ▇▇▇▇
registrations, copyrights, and licenses necessary for the conduct of such
business, and have not received any notice of conflict with the asserted
rights of others in respect thereof. None of the activities or businesses of
the Company or its Subsidiaries are in violation of, or cause the Company or
its Subsidiaries to violate, any law, rule, regulation, or order of the
United States or any state, county, or locality, or any agency or body of the
United States or any state, county, or locality, the violation of which would
have a material adverse impact upon the condition (financial or otherwise),
business, property, results of operations, or net worth of the Company or its
Subsidiaries.
4.14. Neither the Company nor its Subsidiaries, directly or
indirectly, (i) in violation of law, have made any contributions to any
candidate for political office or failed to disclose fully any such
contributions, or (ii) have made any payment to any state, federal, or
foreign governmental officer or official, or other person charged with
similar public or quasi-public duties, other than payments or contributions
required or allowed by applicable law. The Company's internal accounting
controls and procedures are sufficient to cause the Company to comply in all
material respects with the Foreign Corrupt Practices Act of 1977, as amended.
10
4.15. All contracts and other documents of the Company and its
Subsidiaries which are, under the Rules and Regulations, required to be filed
as exhibits to the Registration Statement have been so filed.
4.16. The Company and its Subsidiaries, directly or indirectly, have
not taken and shall not take any action designed to cause or result in, or
which has constituted or which might reasonably be expected to constitute,
the stabilization or manipulation of the price of the Common Stock to
facilitate the sale or resale of the Securities hereby.
4.17. Except for Marine Shuttle Operations AS and Offshore Shuttle
AS, the Company has no subsidiaries or investments in, and has not made any
loans or advances to, any other corporation, partnership, or other entity.
4.18. The Company has not entered into any agreement or
understanding pursuant to which any person, either directly or indirectly, is
entitled to compensation from the Company or any principal stockholders,
officers, or directors of the Company for services as a finder in connection
with the offering of Securities contemplated by this Agreement.
Section 5
Covenants of the Company
The Company covenants and agrees with BEB that:
5.1. The Company shall use its best efforts to cause the
Registration Statement to become effective. If required, the Company shall
file the Prospectus and any amendment or supplement thereto with the
Commission in the manner and within the time period required by Rule 424(b)
under the Act. Upon notification from the Commission that the Registration
Statement has become effective, the Company shall so advise BEB. The Company,
at no time, whether before or after the Effective Date, shall file any
amendment to the Registration Statement or amendment or supplement to the
Prospectus without first advising BEB of such filing and without furnishing
BEB with a copy thereof. No such amendment or supplement shall be filed if
BEB or BEB's counsel has objected in writing to
10
such filing or if such filing is not in compliance with the Act and the Rules
and Regulations. At the request of BEB, made any time prior to the expiration
of the Offering Period, the Company shall prepare and file with the
Commission, promptly upon BEB's request, any amendments or supplements to the
Registration Statement or Prospectus in compliance with the Act which, in
BEB's opinion, may be necessary or advisable in connection with the sale of
the Securities.
5.2. As soon as the Company is advised thereof, the Company shall
advise BEB and confirm such advice in writing (i) of the receipt of any
comments of the Commission with respect to any filing in connection with the
Registration Statement or supplement to the Prospectus, (ii) of the
effectiveness of any post-effective amendment to the Registration Statement,
(iii) of the filing of any supplement to the Prospectus or any amended
Prospectus, (iv) of any request made by the Commission for amendment of the
Registration Statement, for supplementing of the Prospectus, or for
additional information with respect thereto, or (v) of the issuance (or
threat thereof) by the Commission or any state or regulatory body of any stop
order or other order suspending the effectiveness of the Registration
Statement or any order preventing or suspending the use of any Preliminary
Prospectus or suspending the qualification of the Securities for offering in
any jurisdiction, or of the institution of any proceedings for any of such
purposes. The Company shall use its best efforts to prevent the issuance of
any such order and, if issued, to obtain the lifting thereof as soon as
possible.
5.3. The Company has caused to be delivered to BEB copies of each
Preliminary Prospectus, and the Company has consented and hereby consents to
the use of such copies for the purposes permitted by the Act. The Company
authorizes BEB and the Selected Dealers (collectively, the "Dealers") to use
the Prospectus in connection with the sale of the Securities for such period
as, in the opinion of counsel to BEB, the use thereof is required to comply
with the applicable provisions of the Act and the Rules and Regulations. If,
at any time within such period as a Prospectus is required under the Act to
be delivered in connection with sales by any of the Dealers, (i) it shall be
necessary to amend or supplement the Prospectus to comply with law or with
the Rules and Regulations, or (ii) any event happens of which the Company has
knowledge and which materially affects the Company or the securities of the
Company, or which, in the opinion of counsel for the Company or counsel for
BEB, should be set forth in an amendment to the Registration Statement or an
amendment or supplement to the Prospectus in order to make the statements
therein, in light of the circumstances existing at the time the Prospectus is
required to be delivered to a purchaser of the Securities, not then mis-
11
leading in any material respect, then the Company promptly will notify BEB
and forthwith prepare and furnish to BEB copies of such amended Registration
Statement or Prospectus or of such supplement to be attached to the
Prospectus, in such quantities as BEB may reasonably request, in order that
the Registration Statement and Prospectus, as so amended or supplemented,
will not contain any untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements in the Registration
Statement and Prospectus, in the light of the circumstances under which they
are made, not misleading in any material respect. The preparation and
furnishing of any such amendment or supplement to the Registration Statement
or Prospectus shall be without expense to BEB.
5.4. The Company shall comply with the Act, the Rules and
Regulations, the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), and the rules and regulations promulgated thereunder, in connection
with the offering and issuance of the Securities.
5.5. On the Effective Date and at all times subsequent thereto up to
the Closing Date, (i) the Registration Statement and Prospectus shall conform
in all material respects to the requirements of the Act and the Rules and
Regulations; and (ii) neither the Registration Statement nor the Prospectus
shall include any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make statements
therein not misleading; provided, however, the Company makes no
representations, warranties, or agreements as to information contained in or
omitted from the Registration Statement of Prospectus in reliance upon, and
in conformity with, information furnished to the Company by or on behalf of
BEB.
5.6. The Company shall use its best efforts to assist BEB and its
counsel in order to qualify or register the Securities for sale under (or
obtain an exemption from the application of) the securities or "blue sky"
laws of such jurisdictions as BEB may designate, and shall make such
applications and furnish such information as may be required for that purpose
and to comply with such laws; provided, however, the Company shall not be
required to qualify as a foreign corporation or a dealer in securities or to
execute a general consent of service of process in any jurisdiction in any
action other than one arising out of the offering or sale of the Securities.
The Company, from time to time, shall prepare and file such statements and
reports as are or may be required to continue such qualification in effect
for so long a period as BEB may reasonably request.
12
5.7. The Company shall use its best efforts (i) to cause a
registration statement under the Exchange Act to be declared effective
concurrently with the completion of the Offering and shall notify BEB, in
writing, immediately upon the effectiveness of such registration statement,
and (ii) if requested by BEB, to obtain and keep current a listing in the
Standard & Poor's Corporation Records, Standard and Poor's Monthly Stock
Guide, and ▇▇▇▇▇'▇ Industrial OTC Manual, and to have the Company listed in
such reports for a period of not less than ten (10) years from the Closing
Date.
5.8. For so long as the Company is a reporting company under either
Section 12(g) or 15(d) of the Exchange Act, the Company, at its expense,
shall furnish to its stockholders an annual report (including financial
statements audited by independent public accountants) in reasonable detail
and, at its expense, shall furnish to BEB during the period ending five (5)
years from the date hereof, (i) as soon as practicable after the end of each
fiscal year, a balance sheet of the Company and any of its subsidiaries, as
of the end of such fiscal year, together with statements of income, surplus,
and cash flow of the Company and any subsidiaries for such fiscal year, all
in reasonable detail and accompanied by a copy of the certificate or report
thereon of independent accountants; (ii) as soon as practicable after the end
of each of the first three (3) fiscal quarters of each fiscal year,
consolidated summary financial information of the Company for each such
quarter in reasonable detail; (iii) as soon as they are available, a copy of
all reports (financial or other) mailed to security holders; (iv) as soon as
they are available, a copy of all reports and financial statements furnished
to or filed with the Commission or any securities exchange or automated
quotation system on which any class of securities of the Company is listed,
except such reports and financial statements which may have been granted
"confidential treatment" under the Exchange Act or under any other applicable
law, rule, or regulation; and (v) such other information as BEB, from time to
time, may request, but only to the extent such information is not material,
non-public information. In the event the Company has an active subsidiary or
subsidiaries, such financial statements referred to above will be on a
consolidated basis to the extent the accounts of the Company and its
subsidiary or subsidiaries are consolidated in reports furnished to its
stockholders generally.
5.9. The Company shall comply with all periodic reporting and proxy
solicitation requirements under the Exchange Act.
13
5.10. The Company shall deliver to BEB on or before the Closing Date
two (2) signed copies of the Registration Statement, including all financial
statements and exhibits filed therewith and all amendments thereto, and shall
deliver to BEB such number of conformed copies of the Registration Statement,
including such financial statements (but without exhibits) and all amendments
thereto, as BEB may request. The Company shall deliver to or upon the order
of BEB from time to time until the Effective Date, as many copies of any
Preliminary Prospectus filed with the Commission prior to the Effective Date
as BEB may request. The Company shall deliver to BEB on the Effective Date
and thereafter for so long as a Prospectus is required to be delivered under
the Act, as many copies of the Prospectus, in final form or as thereafter
amended or supplemented, as BEB from time to time may request.
5.11. The Company shall apply the net proceeds from the sale of the
Securities for the purposes set forth in the Prospectus under the heading
"Use of Proceeds", and shall file such reports with the Commission with
respect to the sales of the Securities and the application of the proceeds
therefrom as may be required under the Act.
5.12. Upon the Effective Date, the Company shall make all filings
required, including registration under the Exchange Act, to obtain the
listing of the Common Stock in the NASDAQ System and on the Frankfurt Stock
Exchange and the Berlin Stock Exchange, and shall use its best efforts to
maintain such listings for at least ten (10) years from the date of this
Agreement.
5.13. The Company shall not take, directly or indirectly, any action
designed to, or which constitutes, or which might reasonably be expected to
cause or result in the stabilization or manipulation of the price of the
Securities.
5.14. The Company shall not effect a change in its accounting firm,
except to a nationally recognized accounting firm, for a period of five (5)
years from the Effective Date without the prior written consent of BEB.
5.15. During the Offering Period and for a twenty-five (25) day
period thereafter, the Company shall not issue press releases or engage in
other publicity without the prior written consent of
14
BEB which consent shall not be unreasonably withheld. Notwithstanding the
foregoing, the Company may issue such press releases to comply with its
obligations under applicable securities laws.
5.16. On the Closing Date, all transfer or other taxes (including
franchise, capital stock, or other tax, other than income taxes, imposed by
any jurisdiction), if any, which are required to be paid in connection with
the sale and transfer of the Securities through BEB hereunder shall have been
fully paid or provided for by the Company and all laws imposing such taxes
will have been fully complied with.
Section 6
Conditions to the Obligations of BEB
The obligations of BEB to act as agent of the Company hereunder, to
find purchasers for the Securities, and to consummate the transactions
contemplated on the Closing Date, are subject to the accuracy of (as of the
date hereof and as of the Closing Date) and compliance with the covenants,
representations and warranties of the Company contained herein, the
performance by the Company of its obligations hereunder, and the following
conditions:
6.1. BEB shall have received notice of the effectiveness of the
Registration Statement not later than 9:30 a.m., New York time, on the day
following the date of this Agreement, or at such later time or on such later
date as to which BEB may agree in writing; on or prior to the Closing Date,
no stop order denying or suspending the effectiveness of the Registration
Statement shall have been issued and no proceedings for that or a similar
purpose shall have been instituted or shall be pending or, to BEB's knowledge
or to the knowledge of the Company, shall be contemplated by the Commission;
and any request on the part of the Commission for additional information
shall have been complied with to the reasonable satisfaction of BEB. If
required, the Prospectus shall have been filed with the Commission in the
manner and within the time period required by Rule 424(b) under the Act.
6.2. Prior to the Effective Date and again on and as of the Closing
Date, BEB shall have received a letter from Deloitte & Touche, LLP,
independent public accountants for the Company, substantially in the form
approved by BEB, which sets forth for the period from the last unaudited
balance sheet included in the Registration Statement to a date not more than
five (5) business days
15
prior to the date of such letter (i) changes in the Company's capital stock,
(ii) changes in the Company's net assets, and (iii) changes in the Company's
long term debt.
6.3. At the Closing Date, (i) the representations and warranties of
the Company contained in this Agreement shall be true and correct with the
same effect as if made on and as of the Closing Date, and the Company shall
have performed all of its obligations hereunder and satisfied all the
conditions on its part to be satisfied at or prior to the Closing Date; (ii)
the Registration Statement, the Prospectus, and any amendments or supplements
thereto shall contain all statements which are required to be stated therein
in accordance with the Act and the Rule and Regulations and shall conform to
the requirements thereof in all material respects, and neither the
Registration Statement, the Prospectus, nor any amendment or supplement
thereto shall contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary to make
the statements therein not misleading; (iii) since the respective dates as of
which information is given, there shall have been no material adverse change,
or any development involving a prospective material adverse change, in the
business, properties, condition (financial or otherwise), results of
operations, capital stock, long-term or short-term debt, or general affairs
of the Company from that set forth in the Registration Statement and the
Prospectus, except changes which the Registration Statement and Prospectus
indicate might occur after the Effective Date, and the Company shall not have
incurred any material liabilities or entered into any agreement not in the
ordinary course of business, other than as referred to in the Registration
Statement and Prospectus; (iv) except as set forth in the Prospectus, no
action, suit, or proceedings, at law or in equity, shall be pending or
threatened against the Company which would be required to be set forth in the
Registration Statement, and no proceedings shall be pending or threatened
against the Company before or by any commission, board, or administrative
agency, in the United States or elsewhere, wherein an unfavourable decision,
ruling, or finding would materially and adversely affect the business,
property, condition (financial or otherwise), results of operations, or
general affairs of the Company, and (v) on the Closing Date, BEB shall have
received a certificate, signed by the principal financial officer of the
Company and by either the Chairman of the Board or the President of the
Company, dated as of the Closing Date, evidencing compliance with the
provisions of this Section 6.3.
6.4. All proceedings taken at or prior to the Closing Date in
connection with the issuance and sale of the Securities shall be satisfactory
in form and substance to BEB and BEB shall have been
16
furnished with all such documents, certificates, and opinions as BEB may
reasonably request in connection with this transaction in order to evidence
the accuracy and completeness of any of the representations, warranties, or
statements of the Company, or its compliance with any of the covenants or
conditions contained herein.
Section 7
Conditions to the Obligations of the Company
The obligation of the Company to sell and deliver the Securities is
subject to the following conditions:
7.1. The Registration Statement shall have become effective no later
than 9:30 a.m., New York time, on the day following the date of this
Agreement, or on such later date as the Company and BEB may agree in writing.
7.2. At the Closing Date, no stop orders suspending the
effectiveness of the Registration Statement shall have been issued under the
Act, and no proceedings therefor shall have been initiated or threatened by
the Commission.
Section 8
Indemnification
8.1. The Company agrees to indemnify and hold harmless BEB against
any losses, claims, damages, or liabilities (which, for all purposes of this
Agreement, shall include, but shall not be limited to, all reasonable costs
of defense and investigations and all reasonable attorneys' fees and
disbursements) (collectively, "Liabilities"), to which BEB may become subject
under the Act or otherwise, and shall reimburse, as incurred, BEB for any
legal or other expenses reasonably incurred in connection with investigating,
defending against, or appearing as a third party witness in connection with
any Liabilities, insofar as such Liabilities (or actions in respect thereof)
(i) arise out of or are based upon any untrue statement or alleged untrue
statement of any material fact contained in (1) the Registration Statement,
any Preliminary Prospectus, the Prospectus, or any amendment or supplement
thereto, or (2) any blue sky application or other document executed by the
Company in connection
17
with such application, or written information furnished by the Company, filed
in any state or other jurisdiction in order to qualify any or all of the
Securities under the securities laws thereof (any such application, document,
or information being hereinafter called a "Blue Sky Application"), or (ii)
arise out of or are based upon the omission or alleged omission to state in
the Registration Statement, any Preliminary Prospectus, the Prospectus, any
amendment or supplement thereto, or in any Blue Sky Application, a material
fact required to be stated therein or necessary to make the statements
therein not misleading; provided, however, the Company shall not be liable in
any such case to the extent, but only to the extent, that any such Liability
arises out of or is based upon an untrue statement, an alleged untrue
statement, an omission, or an alleged omission, made in reliance upon and in
conformity with information furnished to the Company by or on behalf of BEB
for use in the preparation of the Registration Statement, any Preliminary
Prospectus, the Prospectus, any amendments or supplement thereto, or any Blue
Sky Application. This indemnity will be in addition to any liability which
the Company may otherwise have.
8.2. BEB will indemnify and hold harmless the Company, each of its
directors, each nominee for director named in the Prospectus (if any), each
of its officers who have signed the Registration Statement, and each person,
if any, who controls the Company within the meaning of the Act, against any
Liabilities to which the Company or any such director, nominee, officer, or
controlling person may become subject under the Act or otherwise, insofar as
such Liabilities (or actions in respect thereof) arise out of or are based
upon (i) a breach of the provisions of Sections 3.3 and 3.4 hereof, or (ii)
any untrue statement, or alleged untrue statement of any material fact
contained in the Registration Statement, any Preliminary Prospectus, the
Prospectus, or any amendment or supplement thereto, or arise out 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; provided, however, BEB shall be liable only to the extent that
such untrue statement, alleged untrue statement, omission, or alleged
omission contained in the Registration Statement, any Preliminary Prospectus,
the Prospectus, or any amendment or supplement thereto, was made in reliance
upon and in conformity with information furnished to the Company by BEB for
use in the preparation thereof. This indemnity will be in addition to any
liability which BEB may otherwise have.
8.3. If, after receipt by an indemnified party under this Section 8
of notice of the commencement of any action, a claim in respect thereof is to
be made against the indemnifying party
18
under this Section 8, then such indemnified party promptly shall notify the
indemnifying party in writing of the commencement thereof; however, the
omission to notify the indemnifying party shall not relieve the indemnifying
party from any liability which it may have to any indemnified party otherwise
than under this Section 8. In case any such action is brought against any
indemnified party and it notifies the indemnifying party of the commencement
thereof, the indemnifying party, subject to the provisions stated herein,
shall be entitled to participate in, and to the extent that it may wish,
jointly with any other indemnifying party similarly notified, assume the
defense thereof, with counsel reasonably satisfactory to such indemnified
party. After notice from the indemnifying party to such indemnified party of
its election to assume the defense thereof, the indemnifying party will not
be liable to such indemnified party under this Section 8 for any legal or
other expenses subsequently incurred by such indemnified party in connection
with the defense thereof, other than for reasonable costs of investigation.
The indemnified party shall have the right to employ separate counsel in any
such action and to participate in the defense thereof, but the fees and
expenses of such separate counsel shall not be at the expense of the
indemnifying party if the indemnifying party has assumed the defense of the
action with counsel reasonably satisfactory to the indemnified party;
provided, however, the fees and expenses of such separate counsel shall be at
the expense of the indemnifying party if (i) the employment of such separate
counsel has been specifically authorized in writing by the indemnifying
party, or (ii) the defendants in any such action include both the indemnified
and the indemnifying party, and the indemnified party reasonably has
concluded that (1) there may be a conflict between the positions of the
indemnifying party and the indemnified party in conducting the defense of any
such action, or (2) there may be legal defences available to the indemnified
party and/or other indemnified parties which are different from or additional
to those available to the indemnifying party (in which case the indemnifying
party shall not have the right to assume the defense of such action on behalf
of such indemnified party or parties). It is understood, however, that the
indemnifying party, in connection with any one such action, or in connection
with any separate but substantially similar or related action in the same
jurisdiction arising out of the same general allegations or circumstances,
shall not be liable for the fees and expenses of more than one such separate
counsel for the indemnified party in all such actions, which counsel shall be
designated in writing by the indemnified party. No settlement of any action
against an indemnified party shall be made without the consent of the
indemnified party, which consent shall not be unreasonably withheld.
19
Section 9
Cost and Expenses.
9.1. Whether or not the sale of the Securities through BEB is
consummated, the Company shall pay all costs and expenses incident to the
performance of this Agreement by the Company including, but not limited to:
the fees and expenses of counsel to the Company and of the Company's
accountants; the costs and expenses incident to the preparation, printing,
filing, and distribution under the Act of the Registration Statement
(including the financial statements therein and all amendments and exhibits
thereto), each Preliminary Prospectus, and the Prospectus, as amended or
supplemented; all expenses, fees, and disbursements of counsel to BEB in
connection with the qualification or registration of the Securities (or the
exception from such requirements) under the securities or "blue sky" laws of
the states which BEB shall designate; the cost of printing and furnishing to
BEB copies of the Registration Statement, each Preliminary Prospectus, the
Prospectus, this Agreement, the Agreement Among Underwriters, the Selling
Agreement, the Selected Dealers Agreement, the Underwriter's Questionnaire
and Power of Attorney, and the Blue Sky Memorandum; any fees relating to the
listing of the Securities on NASDAQ, on the Frankfurt Stock Exchange and the
Berlin Stock Exchange or any other securities exchange; the cost of printing
the certificates representing the Securities; the fees of the transfer agent;
and the cost of publication of a "tombstone" of the Offering. The Company
shall pay any and all taxes (including any transfer, franchise, capital
stock, or other tax imposed by any jurisdiction) on sales through BEB
hereunder. The Company also shall pay all costs and expenses incident to the
furnishing of any amended Prospectus or any supplement to be attached to the
Prospectus as called for in Section 5.1 of this Agreement.
9.2. If the transactions contemplated hereby are not consummated by
reason of any action of BEB (except an action based upon the Company's breach
of any covenant, representation, or warranty contained herein, or because any
other condition to BEB's obligations hereunder which is required to be
fulfilled by the Company is not fulfilled), the Company shall be liable for
the out-of-pocket expenses of BEB up to $25,000, including the legal fees of,
and disbursements incurred by, BEB's counsel.
9.3. If the transactions contemplated hereby are not consummated by
reason of a breach by the Company of any covenant, representation, or
warranty herein, or (ii) if the Registration State-
20
ment is not declared effective by the Commission within six (6) months after
the date of the filing of the Registration Statement with the Commission, and
the Company elects to discontinue the Offering through BEB, then the Company
shall be liable for all out-of-pocket expenses of BEB actually incurred
(including the legal fees of and disbursements incurred by BEB's counsel) in
connection with the Offering.
9.4. Except as set forth in the Prospectus, (i) no person, directly
or indirectly, is entitled to compensation from the Company, BEB or any other
person for services as a finder in connection with the Offering, and (ii) the
Company agrees to indemnify and hold harmless BEB against any Liabilities to
which BEB may become subject, insofar as such Liabilities (or actions in
respect thereof) arise out of or are based upon the claim of any person
(other than an employee of the party claiming indemnity) or entity that he or
it is entitled to a finder's fee in connection with the Offering by reason of
such person's or entity's influence or prior contact with the indemnifying
party.
Section 10
Termination
10.1. BEB may terminate this Agreement, except for Sections 8, 9 and
11.1, at any time prior to the Closing Date, if, in its sole judgement, it is
impracticable to offer for sale or to enforce contracts made by BEB for the
sale of the Securities hereunder by reason of (i) the Company having
sustained a material loss, whether or not insured, by reason of fire,
earthquake, flood, accident, or other calamity, or from any labour dispute or
court or government action, order, or decree, (ii) trading in securities on
the New York Stock Exchange or the American Stock Exchange having been
suspended or limited, (iii) material governmental restrictions having been
imposed on trading in securities generally (not in force and effect on the
date hereof), (iv) a banking moratorium having been declared by German state
authorities, (v) an outbreak of major international hostilities, or other
national or international calamity having occurred, (vi) a pending or
threatened legal or governmental proceeding or action relating generally to
the Company's business, or a notification having been received by the Company
of the threat of any such proceeding or action, which could materially
adversely affect the Company; (vii) except as contemplated by the Prospectus,
the Company being merged or consolidated into, or acquired by another company
or group, or the existence of a binding legal commitment for the foregoing,
or any other material change of ownership or control occurs; (viii) the
21
passage of any act or measure by the Congress of the United States or by any
state legislative body of similar impact, or the adoption of any orders,
rules, or regulations by any governmental body, authoritative accounting
institute or board, or any governmental executive, which is reasonably
believed by BEB to have a material impact on the business, financial
condition, or financial statements of the Company or any subsidiary of or
successor to the Company; (ix) any material adverse change in the financial
or securities markets, beyond normal market fluctuations, having occurred
since the date of this Agreement, or (x) any material adverse change having
occurred, since the respective dates as of which information is given in the
Registration Statement and Prospectus, in the earnings, business prospectus,
or general condition of the Company, financial or otherwise, whether or not
arising in the ordinary course of business.
10.2. If, at the Closing Date, any of the conditions provided for in
Section 6 shall not have been fulfilled, BEB may terminate this Agreement and
all of its obligations hereunder, by notifying the Company of such
termination, in writing or by telefax, at or prior to the Closing Date.
10.3. If BEB elects to terminate this Agreement as provided in this
Section 10, the Company promptly shall be notified by BEB by telephone or
telefax, followed by confirmation by letter.
Section 11
Miscellaneous
11.1. The respective indemnities, agreements, representations,
warranties, and other statements of and by the Company and BEB, and the
undertakings set forth in or made pursuant to this Agreement, shall remain in
full force and effect, regardless of any investigation made by or on behalf
of BEB, the Company or any of its officers or directors or any controlling
person, and shall survive delivery of and payment of the Securities and the
termination of this Agreement.
11.2. Each of the parties hereto will cooperate with the other and
execute and deliver to the other party hereto such other instruments and
documents and take such other actions as may be reasonably requested from
time to time by the other party hereto as necessary to carry out, evidence,
and confirm the intended purposes of this Agreement.
22
11.3. This Agreement may not be amended except by an instrument in
writing signed on behalf of each of the parties.
11.4. This Agreement contains the entire agreement between the
parties with respect to the subject matter hereof and supersede all prior
arrangements and understandings, both written and oral, expressed or implied,
with respect thereto.
11.5. It is the desire and intent of the parties that the provisions
of this Agreement be enforced to the fullest extent permissible under the law
and public policies applied in each jurisdiction in which enforcement is
sought. Accordingly, in the event that any provision of this Agreement would
be held in any jurisdiction to be invalid, prohibited or unenforceable for
any reason, such provision, as to such jurisdiction, will be ineffective,
without invalidating the remaining provisions of this Agreement or affecting
the validity or enforceability of such provision in any other jurisdiction.
Notwithstanding the foregoing, if such provision could be more narrowly drawn
so as not to be invalid, prohibited or unenforceable in such jurisdiction, it
will, as to such jurisdiction, be so narrowly drawn, without invalidating the
remaining provisions of this Agreement or affecting the validity or
enforceability of such provision in any other jurisdiction.
11.6. All notices and other communications required or permitted
under to this Agreement must be in writing and will be deemed given if sent
by personal delivery, fax with electronic confirmation of delivery,
internationally-recognized overnight courier company that is able to provide
proof or receipt of delivery, or registered or certified mail (return receipt
requested), postage prepaid, to the parties at the following addresses (or at
such other address for a party as may be specified by like notice):
If to BEB: Berliner Effektenbank AG
Attention: ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇
Tel: 49-30-89 02 13 00
Fax: 49-30-89 02 13 99
If to the Company: Marine Shuttle Operations, Inc.
Attention: ▇▇. ▇▇▇▇▇ ▇▇▇▇, President
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
23
Tel: ▇▇▇-▇▇▇-▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
With a copy to: ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇, LLP
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇
Tel: ▇▇▇-▇▇▇-▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
All such notices and other communications will be deemed to have
been received (i) in the case of personal delivery, on the date of such
delivery, (ii) in the case of a fax, when the party sending such fax has
received electronic confirmation of its delivery, (iii) in the case of
delivery by internationally-recognized overnight courier, on the business day
following dispatch and (iv) in the case of mailing, on the third business day
following mailing.
11.7. The headings contained in this Agreement are for reference
purposes only and will not affect in any way the meaning or interpretation of
this Agreement.
11.8. None of the provisions of this Agreement is or will be
construed as for the benefit of or enforceable by any person not a party to
this Agreement.
11.9. This Agreement may not be assigned by any party, by operation
of law or otherwise.
11.10. This Agreement will be governed by and construed in
accordance with the laws of the State of Nevada applicable to contracts made
and to be performed therein, without regard to conflicts of laws principles.
11.11. The language used in this Agreement will be deemed to be the
language chosen by the parties to express their mutual intent, and no rule of
strict construction will be applied against any party. Any reference to any
federal, state, local, or foreign statute or law will be deemed also to refer
to all rules and regulations promulgated thereunder, unless the context
requires otherwise. The parties intend that each representation, warranty,
and covenant contained herein will have independent significance. If any
party has breached any representation, warranty, or covenant contained herein
in any respect, the fact that there exists another representation, warranty,
or covenant relating to the same
24
subject matter (regardless of the relative levels of specificity) which the
party has not breached will not detract from or mitigate the fact that the
party is in breach of the first representation, warranty, or covenant. Unless
otherwise expressly provided, the word "including" does not limit the
preceding words or terms.
11.12. This Agreement may be executed in one or more counterparts,
all of which will be considered one and the same agreement and will become
effective when one or more counterparts have been signed by each of the
parties and delivered to the other parties, it being understood that all
parties need not sign the same counterpart.
11.13. This Agreement may be executed by delivery of executed
signature pages by fax and such fax execution will be effective for all
purposes.
Marine Shuttle Operations, Inc.
By:
--------------------
Name: ▇▇. ▇▇▇▇▇ ▇▇▇▇
Title: President
Berliner Effektenbank AG
By: By:
------------------------- -----------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇ Name: ▇▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Title: Vorstandsvorsitzender Title: Vorstandsmitglied
25
