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EXHIBIT 1.1
10,000,000 Shares
W-H ENERGY SERVICES, INC.
Common Stock
UNDERWRITING AGREEMENT
October 10, 2000
CREDIT SUISSE FIRST BOSTON CORPORATION
XXXXXX XXXXXXX & CO. INCORPORATED
XXXXXXXXX, LUFKIN & XXXXXXXX
SECURITIES CORPORATION
UBS WARBURG LLC
XXXXXXX & COMPANY INTERNATIONAL
DLJdirect Inc.
As representatives of the several
Underwriters named in Schedule I hereto
c/o Credit Suisse First Boston Corporation
Eleven Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000; and
Xxxxxx Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
W-H Energy Services, Inc., a Texas corporation (the "Company"),
proposes to issue and sell to the several underwriters named in Schedule I
hereto (the "Underwriters"), 10,000,000 shares of common stock, par value $.0001
per share, of the Company (the "Firm Shares"). Certain shareholders of the
Company named in Schedule II hereto (the "Selling Stockholders") severally
propose to sell to the Underwriters not more than an aggregate of 1,500,000
additional shares of common stock, par value $.0001 per share, of the Company
(the "Additional Shares"), each Selling Stockholder selling up to the amount set
forth opposite such Selling Stockholder's name in Schedule II hereto if
requested by the Underwriters as provided in Section 2 hereof. The Firm Shares
and the Additional Shares are hereinafter referred to collectively as the
"Shares." The shares of common stock of the Company to be outstanding after
giving effect to the sales contemplated hereby are hereinafter referred to as
the "Common Stock." The Company and the Selling Stockholders are hereinafter
sometimes referred to collectively as the "Sellers," and individually as a
"Seller."
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SECTION 1. Registration Statement and Prospectus. The Company has
prepared and filed with the Securities and Exchange Commission (the
"Commission") in accordance with the provisions of the Securities Act of 1933,
as amended, and the rules and regulations of the Commission thereunder
(collectively, the "ACT"), a registration statement on Form S-1, including a
prospectus, relating to the Shares. The registration statement, as amended at
the time it became effective, including the information (if any) deemed to be
part of the registration statement at the time of effectiveness pursuant to Rule
430A under the Act, is hereinafter referred to as the "Registration Statement;"
and the prospectus in the form first used to confirm sales of Shares is
hereinafter referred to as the "Prospectus." If the Company has filed or is
required pursuant to the terms hereof to file a registration statement pursuant
to Rule 462(b) under the Act registering additional shares of Common Stock (a
"Rule 462(b) Registration Statement"), then, unless otherwise specified, any
reference herein to the term "Registration Statement" shall be deemed to include
such Rule 462(b) Registration Statement.
SECTION 2. Agreements to Sell and Purchase and Lock-Up. On the basis of
the representations and warranties contained in this Agreement, and subject to
its terms and conditions, (i) the Company agrees to issue and sell 10,000,000
Firm Shares, and (ii) each Underwriter agrees, severally and not jointly, to
purchase from the Company at a price per Share of $15.345 (the "Purchase Price")
the number of Firm Shares set forth opposite the name of such Underwriter in
Schedule I hereto.
On the basis of the representations and warranties contained in this
Agreement, and subject to its terms and conditions, the Selling Stockholders
agree to sell the Additional Shares and the Underwriters shall have the right to
purchase, severally and not jointly, up to an aggregate of 1,500,000 Additional
Shares from the Selling Stockholders at the Purchase Price. Additional Shares
may be purchased solely for the purpose of covering over-allotments made in
connection with the offering of the Firm Shares. The Underwriters may exercise
their right to purchase Additional Shares in whole or in part from time to time
by giving written notice thereof to the Company and the Selling Stockholders
within 30 days after the date of this Agreement. You shall give any such notice
on behalf of the Underwriters and such notice shall specify the aggregate number
of Additional Shares to be purchased pursuant to such exercise and the date for
payment and delivery thereof, which date shall be a business day (i) no earlier
than two business days after such notice has been given (and, in any event, no
earlier than the Closing Date (as hereinafter defined)) and (ii) no later than
ten business days after such notice has been given. If any Additional Shares are
to be purchased, each Underwriter, severally and not jointly, agrees to purchase
from the Selling Stockholders the number of Additional Shares (subject to such
adjustments to eliminate fractional shares as you may determine) which bears the
same proportion to the total number of Additional Shares to be purchased from
the Selling Stockholders as the amount set forth opposite the name of such
Underwriter in Schedule I bears to the total number of Firm Shares. If less than
all of the Additional Shares are to be purchased by the Underwriters upon any
exercise of their over-allotment option, the Underwriters shall purchase from
each Selling Stockholder the number of Additional Shares (subject to such
adjustments to eliminate fractional shares as you may determine) which bears the
same proportion to the total number of Additional Shares to be purchased from
all of the Selling Stockholders upon such exercise as the number of Additional
Shares set forth opposite the name
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of such Selling Stockholder in Schedule II bears to the total number of
Additional Shares set forth on such schedule.
Each Seller hereby agrees not to (i) offer, pledge, sell, contract to
sell, sell any option or contract to purchase, purchase any option or contract
to sell, grant any option, right or warrant to purchase, or otherwise transfer
or dispose of, directly or indirectly, any shares of Common Stock or any
securities convertible into or exercisable or exchangeable for Common Stock or
(ii) enter into any swap or other arrangement that transfers all or a portion of
the economic consequences associated with the ownership of any Common Stock
(regardless of whether any of the transactions described in clause (i) or (ii)
is to be settled by the delivery of Common Stock, or such other securities, in
cash or otherwise), except (x) to the Underwriters pursuant to this Agreement
and (y) for distributions by W-H investment, L.P. and W-H Investment II, G.P.
(the "Jordan Funds"), to their respective partners, so long as such partners
agree in writing to be bound by the foregoing restrictions, for a period of 180
days after the date of the Prospectus without the prior written consent of
Credit Suisse First Boston Corporation ("CSFB") and Xxxxxx Xxxxxxx & Co.
Incorporated ("Xxxxxx"). Notwithstanding the foregoing, during such period (i)
the Company may grant stock options pursuant to the Company's existing stock
option plan and (ii) the Company may issue shares of Common Stock upon the
exercise of an option or warrant or the conversion of a security outstanding on
the date hereof. The Company also agrees not to file any registration statement
with respect to any shares of Common Stock or any securities convertible into or
exercisable or exchangeable for Common Stock for a period of 180 days after the
date of the Prospectus without the prior written consent of CSFB and Xxxxxx;
provided, however, the Company may file a Registration Statement on Form S-8 to
register shares of Common Stock to be issued upon the exercise of options
granted under its 1997 Stock Option Plan and under its Nonstatutory Stock Option
Agreement with Xxxxxxx X. Xxxxx, Xx. In addition, each Selling Stockholder
agrees that, for a period of 180 days after the date of the Prospectus without
the prior written consent of CSFB and Xxxxxx, it will not make any demand for,
or exercise any right with respect to, the registration of any shares of Common
Stock or any securities convertible into or exercisable or exchangeable for
Common Stock. The Company shall, prior to or concurrently with the execution of
this Agreement, deliver an agreement executed by (i) each of the directors and
executive officers of the Company and (ii) each person listed on Annex I hereto
to the effect that such person will not, during the period commencing on the
date such person signs such agreement and ending 180 days after the date of the
Prospectus, without the prior written consent of Xxxxxxxxx, Lufkin & Xxxxxxxx
Securities Corporation ("DLJSC") (which has separately agreed not to give such
consent without the consent of CSFB and Xxxxxx), (A) engage in any of the
transactions described in the first sentence of this paragraph or (B) make any
demand for, or exercise any right with respect to, the registration of any
shares of Common Stock or any securities convertible into or exercisable or
exchangeable for Common Stock.
However, in the case of (i) the Selling Stockholders, including any
permitted distributees of the Jordan Funds, (ii) each of the directors and
executive officers of the Company and (iii) each person listed on Annex I
hereto, 25% of the shares of Common Stock owned by each of such persons will be
released from the restrictions described in the above paragraph if the reported
last sale price of the Common Stock on the Nasdaq National Market is at least
twice the initial public offering price for 20 of the 30 consecutive trading
days ending on the last trading
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day of the 90-day period after the date of the Prospectus. These shares will be
released on the later to occur of the end of the 90-day period after the date of
the Prospectus and the second trading day after the first public release of
quarterly results by the Company. An additional 25% of the shares owned by each
of the persons named in the preceding sentence will be released from the
restrictions described in the above paragraph if at the end of the 135-day
period after the date of the Prospectus the reported last sale price of the
common stock on the Nasdaq National Market is at least twice the initial public
offering price for 20 of the 30 consecutive trading days ending on the last
trading day of the 135-day period after the date of the Prospectus.
As part of the offering contemplated by this Agreement, DLJSC has
agreed to reserve, of the Shares set forth opposite its name on the Schedule I
to this Agreement, up to 500,000 shares, for sale to the Company's employees,
officers, and directors and other parties associated with the Company
(collectively, "Participants"), as set forth in the Prospectus under the heading
"Underwriting" (the "Directed Share Program"). The Shares to be sold by DLJSC
pursuant to the Directed Share Program (the "Directed Shares") will be sold by
DLJSC pursuant to this Agreement at the public offering price. Any Directed
Shares not orally confirmed for purchase by any Participants by the end of the
business day on which this Agreement is executed will be offered to the public
by DLJSC as set forth in the Prospectus.
The Company hereby confirms its engagement of Xxxxxx as, and Xxxxxx
hereby confirms its agreement with the Company to render services as, a
"qualified independent underwriter," within the meaning of Section (b)(15) of
Rule 2720 of the National Association of Securities Dealers, Inc. with respect
to the offering and sale of the Shares. Xxxxxx, solely in its capacity as the
qualified independent underwriter and not otherwise, is referred to herein as
the "QIU." The price at which the Shares will be sold to the public shall not be
higher than the maximum price recommended by the QIU.
SECTION 3. Terms of Public Offering. The Sellers are advised by you
that the Underwriters propose (i) to make a public offering of their respective
portions of the Shares as soon after the execution and delivery of this
Agreement as in your judgment is advisable and (ii) initially to offer the
Shares upon the terms set forth in the Prospectus.
SECTION 4. Delivery and Payment. The Shares shall be represented by
definitive certificates and shall be issued in such authorized denominations and
registered in such names as CSFB and Xxxxxx shall request no later than two
business days prior to the Closing Date or the applicable Option Closing Date
(as defined below), as the case may be. The Shares shall be delivered by or on
behalf of the Sellers, with any transfer taxes thereon duly paid by the
respective Sellers, to CSFB and Xxxxxx through the facilities of The Depository
Trust Company ("DTC"), for the respective accounts of the several Underwriters,
against payment to the Sellers of the Purchase Price therefore by wire transfer
of Federal or other funds immediately available in New York City. The
certificates representing the Shares shall be made available for inspection not
later than 9:30 A.M., New York City time, on the business day prior to the
Closing Date or the applicable Option Closing Date, as the case may be, at the
office of DTC or its designated custodian (the "Designated Office"). The time
and date of delivery and payment for the Firm Shares shall be 9:00 A.M., New
York City time, on October 10, 2000, or such other time on the same or such
other date as CSFB, Xxxxxx and the Company shall agree in writing. The time and
date of delivery and payment for the Firm Shares are hereinafter referred to as
the "Closing Date." The time and date of delivery and payment for any Additional
Shares to be
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purchased by the Underwriters shall be 9:00 A.M., New York City time, on the
date specified in the applicable exercise notice given by you pursuant to
Section 2 or such other time on the same or such other date as CSFB, Xxxxxx and
the Company shall agree in writing. The time and date of delivery and payment
for any Additional Shares are hereinafter referred to as the "Option Closing
Date."
The documents to be delivered on the Closing Date or any
Option Closing Date on behalf of the parties hereto pursuant to Section 10 of
this Agreement shall be delivered at the offices of Xxxxxxx & Xxxxx L.L.P., 0000
Xxxxx Xxxxx, Xxxxxxx, Xxxxx, 00000, and the Shares shall be delivered at the
Designated Office, all on the Closing Date or such Option Closing Date, as the
case may be.
SECTION 5. Agreements of the Company. The Company agrees with you:
(a) To advise you promptly and, if requested by you, to confirm such
advice in writing, (i) of any request by the Commission for amendments to the
Registration Statement or amendments or supplements to the Prospectus or for
additional information, (ii) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or of the suspension
of qualification of the Shares for offering or sale in any jurisdiction, or the
initiation of any proceeding for such purposes, (iii) when any amendment to the
Registration Statement becomes effective, (iv) if the Company is required to
file a Rule 462(b) Registration Statement after the effectiveness of this
Agreement, when the Rule 462(b) Registration Statement has become effective and
(v) of the happening of any event during the period referred to in Section 5(d)
below which makes any statement of a material fact made in the Registration
Statement or the Prospectus untrue or which requires any additions to or changes
in the Registration Statement or the Prospectus in order to make the statements
therein not misleading. If at any time the Commission shall issue any stop order
suspending the effectiveness of the Registration Statement, the Company will use
its reasonable best efforts to obtain the withdrawal or lifting of such order at
the earliest possible time.
(b) To furnish to you two signed copies of the Registration Statement
as first filed with the Commission and of each amendment to it, including all
exhibits, and to furnish to you and each Underwriter designated by you such
number of conformed copies of the Registration Statement as so filed and of each
amendment to it, without exhibits, as you may reasonably request.
(c) To prepare the Prospectus, the form and substance of which shall be
reasonably satisfactory to you, and to file the Prospectus in such form with the
Commission within the applicable period specified in Rule 424(b) under the Act;
during the period specified in Section 5(d) below, not to file any further
amendment to the Registration Statement and not to make any amendment or
supplement to the Prospectus of which you shall not previously have been advised
or to which you shall reasonably object after being so advised; and, during such
period, to prepare and file with the Commission, promptly upon your reasonable
request, any amendment to the Registration Statement or amendment or supplement
to the Prospectus which may be necessary or advisable in connection with the
distribution of the Shares by you, and to use its
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reasonable best efforts to cause any such amendment to the Registration
Statement to become promptly effective.
(d) Prior to 10:00 A.M., New York City time, on the first business day
after the date of this Agreement and from time to time thereafter for such
period as in the opinion of counsel for the Underwriters a prospectus is
required by law to be delivered in connection with sales by an Underwriter or a
dealer, to furnish in New York City to each Underwriter and any dealer as many
copies of the Prospectus (and of any amendment or supplement to the Prospectus)
as such Underwriter or dealer may reasonably request.
(e) If during the period specified in Section 5(d), any event shall
occur or condition shall exist as a result of which, in the opinion of counsel
for the Underwriters, it becomes necessary to amend or supplement the Prospectus
in order to make the statements therein, in the light of the circumstances when
the Prospectus is delivered to a purchaser, not misleading, or if, in the
opinion of counsel for the Underwriters, it is necessary to amend or supplement
the Prospectus to comply with applicable law, forthwith to prepare and file with
the Commission an appropriate amendment or supplement to the Prospectus so that
the statements in the Prospectus, as so amended or supplemented, will not in the
light of the circumstances when it is so delivered, be misleading, or so that
the Prospectus will comply with applicable law, and to furnish to each
Underwriter and to any dealer as many copies thereof as such Underwriter or
dealer may reasonably request.
(f) Prior to any public offering of the Shares, to cooperate with you
and counsel for the Underwriters in connection with the registration or
qualification of the Shares for offer and sale by the several Underwriters and
by dealers under the state securities or Blue Sky laws of such jurisdictions as
you may request, to continue such registration or qualification in effect so
long as required for distribution of the Shares and to file such consents to
service of process or other documents as may be necessary in order to effect
such registration or qualification; provided, however, that the Company shall
not be required in connection therewith to qualify as a foreign corporation in
any jurisdiction in which it is not now so qualified or to take any action that
would subject it to general consent to service of process or taxation in any
jurisdiction in which it is not now so subject.
(g) To mail and make generally available to its shareholders as soon as
practicable an earnings statement covering the twelve-month period ending June
30, 2001 that shall satisfy the provisions of Section 11(a) of the Act, and to
advise you in writing when such statement has been so made available.
(h) During the period of three years after the date of this Agreement,
to furnish to you as soon as available copies of all reports or other
communications furnished to the record holders of Common Stock or furnished to
or filed with the Commission or any national securities exchange on which any
class of securities of the Company is listed and such other publicly available
information concerning the Company and its subsidiaries as you may reasonably
request.
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(i) Whether or not the transactions contemplated in this Agreement are
consummated or this Agreement is terminated, to pay or cause to be paid all
expenses incident to the performance of the Sellers' obligations under this
Agreement, including: (i) the fees, disbursements and expenses of the Selling
Stockholder's counsel, the Company's counsel and the Company's accountants in
connection with the registration and delivery of the Shares under the Act and
all other fees and expenses in connection with the preparation, printing, filing
and distribution of the Registration Statement (including financial statements
and exhibits), any preliminary prospectus, the Prospectus and all amendments and
supplements to any of the foregoing, including the mailing and delivering of
copies thereof to the Underwriters and dealers in the quantities specified
herein, (ii) all costs and expenses related to the transfer and delivery of the
Shares to the Underwriters, including any transfer or other taxes payable
thereon, (iii) all costs of printing or producing this Agreement and any other
agreements or documents in connection with the offering, purchase, sale or
delivery of the Shares, (iii) all fees and expenses in connection with the
preparation and filing of the registration statement on Form 8-A relating to the
Common Stock and all costs and expenses incident to the listing of the Shares on
the Nasdaq National Market, (iv) the cost of printing certificates representing
the Shares, (v) the filing fees in connection with the review and clearance of
the offering of the Shares by the National Association of Securities Dealers,
Inc., (vi) the costs and charges of any transfer agent, registrar and/or
depositary, (vii) the fees and expenses of the QIU (including the fees and
disbursements of counsel to the QIU) and (viii) all other costs and expenses
incident to the performance of the obligations of the Company hereunder for
which provision is not otherwise made in this Section. Other than legal fees and
expenses, which shall be paid by the Company, the Selling Stockholders shall pay
all costs and expenses incident to the performance of their obligations
hereunder; provided, the provisions of this Section shall not supersede or
otherwise affect any agreement that the Company and the Selling Stockholders may
otherwise have for allocation of such expenses among themselves. Except as
otherwise provided for in this Section 5(i), the Underwriters shall pay their
own costs and expenses, including the fees and expenses of their counsel,
transfer taxes on resales of any Shares by them and advertising expenses
connected with any offers they make.
(j) To use its reasonable best efforts to list for quotation the Shares
on the Nasdaq National Market.
(k) To use its reasonable best efforts to do and perform all things
required or necessary to be performed under this Agreement by the Company prior
to the Closing Date or any Option Closing Date, as the case may be, and to
satisfy all conditions precedent to the delivery of the Shares.
(l) If the Registration Statement at the time of the effectiveness of
this Agreement does not cover all of the Shares, to file a Rule 462(b)
Registration Statement with the Commission registering the Shares not so covered
in compliance with Rule 462(b) by 10:00 P.M., New York City time, on the date of
this Agreement and to pay to the Commission the filing fee for such Rule 462(b)
Registration Statement at the time of the filing thereof or to give irrevocable
instructions for the payment of such fee pursuant to Rule 111(b) under the Act.
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(m) That in connection with the Directed Share Program, the Company
will ensure that the Directed Shares will be restricted to the extent required
by the National Association of Securities Dealers, Inc. (the "NASD") or the NASD
rules from sale, transfer, assignment, pledge or hypothecation for a period of
three months following the date of the effectiveness of the Registration
Statement. DLJSC will notify the Company as to which Participants will need to
be so restricted. The Company will direct the removal of such transfer
restrictions upon the expiration of such period of time.
(n) To pay all fees and disbursements of counsel incurred by the
Underwriters in connection with the Directed Share Program and stamp duties,
similar taxes or duties or other taxes, if any, incurred by the Underwriters in
connection with the Directed Share Program.
Furthermore, the Company covenants with DLJSC that the Company will
take such reasonable steps as are reasonably requested by DLJSC to cause the
directed share program to comply with all applicable securities and other
applicable laws, rules and regulations in each foreign jurisdiction in which the
Directed Shares are offered in connection with the Directed Share Program.
SECTION 6. Representations and Warranties of the Company. The Company
represents and warrants to each Underwriter that:
(a) The Registration Statement has become effective (other than any
Rule 462(b) Registration Statement to be filed by the Company after the
effectiveness of this Agreement); any Rule 462(b) Registration Statement filed
after the effectiveness of this Agreement will become effective no later than
10:00 P.M., New York City time, on the date of this Agreement; and no stop order
suspending the effectiveness of the Registration Statement is in effect, and no
proceedings for such purpose are pending before or threatened by the Commission.
(b) (i) The Registration Statement (other than any Rule 462(b)
Registration Statement to be filed by the Company after the effectiveness of
this Agreement), when it became effective, did not contain and, as amended, if
applicable, will not contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading, (ii) the Registration Statement (other than
any Rule 462(b) Registration Statement to be filed by the Company after the
effectiveness of this Agreement) and the Prospectus comply and, as amended or
supplemented, if applicable, will comply in all material respects with the Act,
(iii) if the Company is required to file a Rule 462(b) Registration Statement
after the effectiveness of this Agreement, such Rule 462(b) Registration
Statement and any amendments thereto, when they become effective (A) will not
contain any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading and (B) will comply in all material respects with the Act and (iv)
the Prospectus does not contain and, as amended or supplemented, if applicable,
will not contain any untrue statement of a material fact or omit to state a
material fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, except that the
representations and warranties set forth in this paragraph do not apply to
statements or omissions in the Registration Statement or the Prospectus based
upon
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information relating to any Underwriter furnished to the Company in writing by
such Underwriter through you expressly for use therein.
(c) Each of the Company and its subsidiaries listed on Annex II hereto,
which constitute all of the subsidiaries of the Company (the "Subsidiaries"),
has been duly incorporated, is validly existing as a corporation in good
standing under the laws of its jurisdiction of incorporation and has the
corporate power and authority to carry on its business as described in the
Prospectus and to own, lease and operate its properties, and each is duly
qualified and is in good standing as a foreign corporation authorized to do
business in each jurisdiction set forth opposite its name on Annex II hereto,
and such jurisdictions constitute all of the jurisdictions, with respect to each
of the Company and its Subsidiaries, in which the nature of their business or
their ownership or leasing of property requires such qualification, except where
the failure to be so qualified would not have a material adverse effect on the
business, prospects, financial condition or results of operations of the Company
and its Subsidiaries, taken as a whole.
(d) There are no outstanding subscriptions, rights, warrants, options,
calls, convertible securities, commitments of sale or liens granted or issued by
the Company or any of its Subsidiaries relating to or entitling any person to
purchase or otherwise to acquire any shares of the capital stock of the Company
or any of its Subsidiaries, except as otherwise disclosed in the Prospectus.
(e) All the outstanding shares of capital stock of the Company
(including the Additional Shares to be sold by the Selling Stockholders) have
been duly authorized and validly issued and are fully paid, non-assessable and
not subject to any preemptive or similar rights; and the Firm Shares to be
issued and sold by the Company have been duly authorized and, when issued and
delivered to the Underwriters against payment therefor as provided by this
Agreement, will be validly issued, fully paid and non-assessable, and the
issuance of such Firm Shares will not be subject to any preemptive or similar
rights.
(f) All of the outstanding shares of capital stock of each of the
Company's Subsidiaries have been duly authorized and validly issued and are
fully paid and non-assessable, and are owned by the Company, directly or
indirectly through one or more Subsidiaries, free and clear of any security
interest, claim, lien, encumbrance or adverse interest of any nature, except as
disclosed in the Registration Statement.
(g) The authorized capital stock of the Company conforms as to legal
matters to the description thereof contained in the Prospectus.
(h) Neither the Company nor any of its Subsidiaries is in violation of
its respective charter or by-laws or in default in the performance of any
obligation, agreement, covenant or condition contained in any indenture, loan
agreement, mortgage, lease or other agreement or instrument that is material to
the Company and its Subsidiaries, taken as a whole, to which the Company or any
of its Subsidiaries is a party or by which the Company or any of its
Subsidiaries or their respective property is bound.
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(i) The execution, delivery and performance of this Agreement by the
Company, the compliance by the Company with all the provisions hereof and the
consummation of the transactions contemplated hereby will not (i) require any
consent, approval, authorization or other order of, or qualification with, any
court or governmental body or agency (except such as may be required under the
securities or Blue Sky laws of the various states), (ii) conflict with or
constitute a breach of any of the terms or provisions of, or a default under,
the charter or by-laws of the Company or any of its Subsidiaries or any
indenture, loan agreement, mortgage, lease or other agreement or instrument that
is material to the Company and its Subsidiaries, taken as a whole, to which the
Company or any of its Subsidiaries is a party or by which the Company or any of
its Subsidiaries or their respective property is bound, (iii) violate or
conflict with any applicable law or any rule, regulation, judgment, order or
decree of any court or any governmental body or agency having jurisdiction over
the Company, any of its Subsidiaries or their respective property or (iv) result
in the suspension, termination or revocation of any Authorization (as defined
below) of the Company or any of its Subsidiaries or any other impairment of the
rights of the holder of any such Authorization.
(j) There are no legal or governmental proceedings pending or
threatened to which the Company or any of its Subsidiaries is or, to the
Company's knowledge, could be a party or to which any of their respective
property is or, to the Company's knowledge, could be subject that are required
to be described in the Registration Statement or the Prospectus and are not so
described; nor are there any statutes, regulations, contracts or other documents
that are required to be described in the Registration Statement or the
Prospectus or to be filed as exhibits to the Registration Statement that are not
so described or filed as required.
(k) Neither the Company nor any of its Subsidiaries has violated any
foreign, federal, state or local law or regulation relating to the protection of
human health and safety, the environment or hazardous or toxic substances or
wastes, pollutants or contaminants ("Environmental Laws"), any provisions of the
Employee Retirement Income Security Act of 1974, as amended, or any provisions
of the Foreign Corrupt Practices Act or the rules and regulations promulgated
thereunder, except for such violations which, singly or in the aggregate, would
not have a material adverse effect on the business, prospects, financial
condition or results of operation of the Company and its Subsidiaries, taken as
a whole.
(l) Each of the Company and its Subsidiaries has such permits,
licenses, consents, exemptions, franchises, authorizations and other approvals
(each, an "Authorization") of, and has made all filings with and notices to, all
governmental or regulatory authorities and self-regulatory organizations and all
courts and other tribunals, including, without limitation, under any applicable
Environmental Laws, as are necessary to own, lease, license and operate its
respective properties and to conduct its business, except where the failure to
have any such Authorization or to make any such filing or notice would not,
singly or in the aggregate, have a material adverse effect on the business,
prospects, financial condition or results of operations of the Company and its
Subsidiaries, taken as a whole. Each such Authorization is valid and in full
force and effect and each of the Company and its Subsidiaries is in compliance
with all the terms and conditions thereof and with the rules and regulations of
the authorities and governing bodies having jurisdiction with respect thereto;
and no event has occurred (including, without limitation, the receipt of any
notice from any authority or governing body) which allows or, after notice or
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lapse of time or both, would allow, revocation, suspension or termination of any
such Authorization or results or, after notice or lapse of time or both, would
result in any other impairment of the rights of the holder of any such
Authorization; and such Authorizations contain no restrictions that are
materially burdensome to the Company or any of its Subsidiaries; except where
such failure to be valid and in full force and effect or to be in compliance,
the occurrence of any such event or the presence of any such restriction would
not, singly or in the aggregate, have a material adverse effect on the business,
prospects, financial condition or results of operations of the Company and its
Subsidiaries, taken as a whole.
(m) There are no costs or liabilities associated with Environmental
Laws (including, without limitation, any capital or operating expenditures
required for clean-up, closure of properties or compliance with Environmental
Laws or any Authorization, any related constraints on operating activities and
any potential liabilities to third parties) which would, singly or in the
aggregate, have a material adverse effect on the business, prospects, financial
condition or results of operations of the Company and its Subsidiaries, taken as
a whole.
(n) This Agreement has been duly authorized, executed and delivered by
the Company.
(o) Xxxxxx Xxxxxxxx LLP are independent public accountants with respect
to the Company and its Subsidiaries as required by the Act.
(p) The consolidated financial statements included in the Registration
Statement and the Prospectus (and any amendment or supplement thereto), together
with related schedules and notes, present fairly the consolidated financial
position, results of operations and changes in financial position of the Company
and its Subsidiaries on the basis stated therein at the respective dates or for
the respective periods to which they apply; such statements and related
schedules and notes have been prepared in accordance with generally accepted
accounting principles consistently applied throughout the periods involved,
except as disclosed therein; the supporting schedules, if any, included in the
Registration Statement present fairly in accordance with generally accepted
accounting principles the information required to be stated therein; and the
other financial and statistical information and data set forth in the
Registration Statement and the Prospectus (and any amendment or supplement
thereto) are, in all material respects, accurately presented and prepared on a
basis consistent with such financial statements and the books and records of the
Company.
(q) The Company is not and, after giving effect to the offering and
sale of the Shares and the application of the proceeds thereof as described in
the Prospectus, will not be, an "investment company" as such term is defined in
the Investment Company Act of 1940, as amended.
(r) 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 or to require the Company to include such securities with the Shares
registered pursuant to the Registration Statement, except
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for those contracts, agreements or understandings that are disclosed in the
Prospectus and the registration rights under which have been waived in
connection with the offering of the Shares.
(s) Since the respective dates as of which information is given in the
Prospectus other than as set forth in the Prospectus (exclusive of any
amendments or supplements thereto subsequent to the date of this Agreement), (i)
there has not occurred any material adverse change or any development involving
a prospective material adverse change in the business, prospects, financial
condition or results of operation of the Company and its Subsidiaries, taken as
a whole, (ii) there has not been any material adverse change or any development
involving a prospective material adverse change in the capital stock or in the
long-term debt of the Company or any of its Subsidiaries and (iii) neither the
Company nor any of its Subsidiaries has incurred any material liability or
obligation, direct or contingent.
(t) Each certificate signed by any officer of the Company and delivered
to the Underwriters or counsel for the Underwriters pursuant to this Agreement
shall be deemed to be a representation and warranty by the Company to the
Underwriters as to the matters covered thereby.
(u) The Company and its Subsidiaries have good and indefeasible title
to all real property and good and marketable title to all personal property
owned by them which is material to the business of the Company and its
Subsidiaries, in each case free and clear of all liens, encumbrances and defects
except such as are described in the Prospectus or such as do not materially
affect the value of such property and do not interfere with the use made and
proposed to be made of such property by the Company and its Subsidiaries; and
any real property and buildings held under lease by the Company and its
Subsidiaries are held by them under valid, subsisting and enforceable leases
with such exceptions as are not material and do not interfere with the use made
and proposed to be made of such property and buildings by the Company and its
Subsidiaries, in each case except as described in the Prospectus.
(v) The Company and its Subsidiaries own or possess, or can acquire on
reasonable terms, all patents, patent rights, licenses, inventions, copyrights,
know-how (including trade secrets and other unpatented and/or unpatentable
proprietary or confidential information, systems or procedures), trademarks,
service marks and trade names ("intellectual property") currently employed by
them in connection with the business now operated by them except where the
failure to own or possess or otherwise be able to acquire such intellectual
property would not, singly or in the aggregate, have a material adverse effect
on the business, prospects, financial condition or results of operation of the
Company and its Subsidiaries, taken as a whole; and except as disclosed in the
Prospectus, neither the Company nor any of its Subsidiaries has received any
notice of infringement of or conflict with asserted rights of others with
respect to any of such intellectual property which, singly or in the aggregate,
if the subject of an unfavorable decision, ruling or finding, would have a
material adverse effect on the business, prospects, financial condition or
results of operations of the Company and its Subsidiaries, taken as a whole.
(w) The Company and each of its Subsidiaries are insured by insurers of
recognized financial responsibility against such losses and risks and in such
amounts as are prudent and
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customary in the businesses in which they are engaged; and neither the Company
nor any of its Subsidiaries (i) has received notice from any insurer or agent of
such insurer that substantial capital improvements or other material
expenditures will have to be made in order to continue such insurance or (ii)
has any reason to believe that it will not be able to renew its existing
insurance coverage as and when such coverage expires or to obtain similar
coverage from similar insurers at a cost that would not have a material adverse
effect on the business, prospects, financial conditions or results of operations
of the Company and its Subsidiaries, taken as a whole.
(x) No relationship, direct or indirect, exists between or among the
Company or any of its Subsidiaries on the one hand, and the directors, officers,
shareholders, customers or suppliers of the Company or any of its Subsidiaries
on the other hand, which is required by the Act to be described in the
Registration Statement or the Prospectus which is not so described.
(y) The pro forma financial statements of the Company and its
Subsidiaries and the related notes thereto set forth in the Registration
Statement and the Prospectus (and any supplement or amendment thereto) have been
prepared on a basis consistent with the historical financial statements of the
Company and its Subsidiaries, give effect to the assumptions used in the
preparation thereof on a reasonable basis and in good faith and present fairly
the historical and proposed transactions contemplated by the Registration
Statement and the Prospectus. Such pro forma financial statements have been
prepared in accordance with the applicable requirements of Rule 11-02 of
Regulation S-X promulgated by the Commission. The other pro forma financial and
statistical information and data set forth in the Registration Statement and the
Prospectus (and any supplement or amendment thereto) are, in all material
respects, accurately presented and prepared on a basis consistent with the pro
forma financial statements.
(z) There is no (i) significant unfair labor practice complaint,
grievance or arbitration proceeding pending or threatened against the Company or
any of its Subsidiaries before the National Labor Relations Board or any state
or local labor relations board, (ii) strike, labor dispute, slowdown or stoppage
pending or threatened against the Company or any of its Subsidiaries or (iii)
union representation question existing with respect to the employees of the
Company and its Subsidiaries, except for such actions specified in clause (i),
(ii) or (iii) above, which, singly or in the aggregate, would not have a
material adverse effect on the business, prospects, financial condition or
results of operations of the Company and its Subsidiaries, taken as a whole. To
the Company's knowledge, no collective bargaining organizing activities are
taking place with respect to the Company or any of its Subsidiaries.
(aa) The Company and each of its Subsidiaries maintains a system of
internal accounting controls sufficient to provide reasonable assurance that (i)
transactions are executed in accordance with management's general or specific
authorizations, (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally accepted
accounting principles and to maintain asset accountability, (iii) access to
assets is permitted only in accordance with management's general or specific
authorization and (iv) the recorded accountability for assets is compared with
the existing assets at reasonable intervals and appropriate action is taken with
respect to any differences.
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(bb) All material tax returns required to be filed by the Company and
each of its Subsidiaries in any jurisdiction have been filed, other than those
filings being contested in good faith, and all material taxes, including
withholding taxes, penalties and interest, assessments, fees and other charges
due pursuant to such returns or pursuant to any assessment received by the
Company or any of its Subsidiaries have been paid, other than those being
contested in good faith and for which adequate reserves have been provided.
(cc) The Warrant Exchange Agreement, dated October 1, 2000 (the
"Exchange Agreement"), among the Company and DLJ Merchant Banking Partners II,
L.P. and the other investment funds affiliated therewith set forth on Schedule
II hereto (collectively, the "DLJMB Funds") has been duly authorized, executed
and delivered by the Company, and assuming the enforceability thereof against
the other parties thereto, the Exchange Agreement constitutes a valid and
binding agreement of the Company enforceable against the Company in accordance
with its terms, except as such enforceability may be limited by bankruptcy,
insolvency, reorganization, moratorium and other similar laws now or hereinafter
in effect relating to or affecting creditors' rights generally and to general
principles of equity (regardless of whether such enforceability is considered in
a proceeding in equity or at law).
(dd) The Amendment Agreement, dated October 1, 2000 (the "Amendment
Agreement"), among the Company, Perf-O-Log, Inc. and the DLJMB Funds has been
duly authorized, executed and delivered by the Company and, assuming the
enforceability thereof against the other parties thereto, constitutes a valid
and binding agreement of the Company enforceable against the Company in
accordance with its terms, except as such enforceability may be limited by
bankruptcy, insolvency, reorganization, moratorium and other similar laws now or
hereinafter in effect relating to or affecting creditors' rights generally and
to general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law).
(ee) The Credit Agreement (the "New Credit Agreement") to be entered
into, on the Closing Date, among the Company, DLJ Capital Funding, Inc. and the
lenders named therein has been duly authorized by the Company and upon the
execution and delivery thereof by the Company and assuming the enforceability
thereof against the other parties thereto, the New Credit Agreement will
constitute a valid and binding agreement of the Company enforceable against the
Company in accordance with its terms, except as such enforceability may be
limited by bankruptcy, insolvency, reorganization, moratorium and other similar
laws now or hereinafter in effect relating to or affecting creditors' rights
generally and to general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law).
SECTION 7. Representations and Warranties of the Selling Stockholders.
Each Selling Stockholder represents and warrants to each Underwriter that:
(a) Such Selling Stockholder is the lawful owner of the Additional
Shares to be sold by such Selling Stockholder pursuant to this Agreement and
has, and on any Option Closing Date will have, good and clear title to such
Additional Shares, free of all restrictions on transfer, liens, encumbrances,
security interests, equities and claims whatsoever.
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(b) Such Selling Stockholder has, and on any Option Closing Date will
have, full legal right, power and authority, and all authorization and approval
required by law, to enter into this Agreement and the Custody Agreement signed
by such Selling Stockholder and Computershare Trust Company, Inc., as Custodian,
relating to the deposit of the Additional Shares to be sold by such Selling
Stockholder (the "Custody Agreement") and to sell, assign, transfer and deliver
the Additional Shares to be sold by such Selling Stockholder in the manner
provided herein and therein.
(c) This Agreement has been duly authorized, executed and delivered by
or on behalf of such Selling Stockholder.
(d) The Custody Agreement of such Selling Stockholder has been duly
authorized, executed and delivered by such Selling Stockholder and is a valid
and binding agreement of such Selling Stockholder, enforceable in accordance
with its terms, except as such enforceability may be limited by bankruptcy,
insolvency, reorganization, moratorium and other similar laws now or hereinafter
in effect relating to or affecting creditors' rights generally and to general
principles of equity (regardless of whether such enforceability is considered in
a proceeding in equity or at law).
(e) [Reserved]
(f) Upon delivery of and payment for the Additional Shares to be sold
by such Selling Stockholder pursuant to this Agreement, good and clear title to
such Additional Shares will pass to the Underwriters, free of all restrictions
on transfer, liens, encumbrances, security interests, equities and claims
whatsoever.
(g) The execution, delivery and performance of this Agreement and the
Custody Agreement of such Selling Stockholder by or on behalf of such Selling
Stockholder, the compliance by such Selling Stockholder with all the provisions
hereof and thereof and the consummation of the transactions contemplated hereby
and thereby will not (i) require any consent, approval, authorization or other
order of, or qualification with, any court or governmental body or agency
(except such as may be required under the securities or Blue Sky laws of the
various states), (ii) conflict with or constitute a breach of any of the terms
or provisions of, or a default under, the organizational documents of such
Selling Stockholder, if such Selling Stockholder is not an individual, or any
indenture, loan agreement, mortgage, lease or other material agreement or
instrument to which such Selling Stockholder is a party or by which such Selling
Stockholder or any property of such Selling Stockholder is bound or (iii)
violate or conflict with any applicable law or any rule, regulation, judgment,
order or decree of any court or any governmental body or agency having
jurisdiction over such Selling Stockholder or any property of such Selling
Stockholder.
(h) The information in the Registration Statement under the caption
"Principal and Selling Stockholders" which specifically relates to such Selling
Stockholder does not, and will not on the Closing Date, contain any untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
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(i) At any time during the period described in Section 5(d), if there
is any change in the information referred to in Section 7(h), such Selling
Stockholder will immediately notify you of such change.
(j) Each certificate signed by or on behalf of such Selling Stockholder
and delivered to the Underwriters or counsel for the Underwriters pursuant to
this Agreement shall be deemed to be a representation and warranty by such
Selling Stockholder to the Underwriters as to the matters covered thereby.
Furthermore, each of the DLJMB Funds represents and warrants that the
Exchange Agreement has been duly authorized, executed and delivered on behalf of
each such fund and constitutes a valid and binding agreement of each of the
DLJMB Funds enforceable against each of such funds in accordance with its terms,
except as such enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium and other similar laws now or hereinafter in effect
relating to or affecting creditors' rights generally and to general principles
of equity (regardless of whether such enforceability is considered in a
proceeding in equity or at law).
SECTION 8. Indemnification of QIU. (a) The Company agrees to indemnify
and hold harmless the QIU, its directors, its officers and each person, if any,
who controls the QIU within the meaning of Section 15 of the Act or Section 20
of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), from
and against any and all losses, claims, damages, liabilities and judgments
(including, without limitation, any legal or other expenses incurred in
connection with investigating or defending any matter, including any action,
that could give rise to any such losses, claims, damages, liabilities or
judgments) related to, based upon or arising out of (i) any untrue statement or
alleged untrue statement of a material fact contained in the Registration
Statement (or any amendment thereto), the Prospectus (or any amendment or
supplement thereto) or any preliminary prospectus, or any omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading or (ii) the QIU's
activities as QIU under its engagement pursuant to Section 2 hereof, except in
the case of this clause (ii) insofar as any such losses, claims, damages,
liabilities or judgments are found in a final judgment by a court of competent
jurisdiction to have resulted from the willful misconduct or gross negligence of
the QIU.
(b) In case any action shall be commenced involving any person in
respect of which indemnity may be sought pursuant to Section 8(a) (the "QIU
Indemnified Party"), the QIU Indemnified Party shall promptly notify the Company
in writing and the Company shall assume the defense of such action, including
the employment of counsel reasonably satisfactory to the QIU Indemnified Party
and the payment of all fees and expenses of such counsel, as incurred. Any QIU
Indemnified Party shall have the right to employ separate counsel in any such
action and participate in the defense thereof, but the fees and expenses of such
counsel shall be at the expense of the QIU Indemnified Party unless (i) the
employment of such counsel shall have been specifically authorized in writing by
the Company, (ii) the Company shall have failed to assume the defense of such
action or employ counsel reasonably satisfactory to the QIU Indemnified Party or
(iii) the named parties to any such action (including any impleaded parties)
include both the QIU Indemnified Party and the Company, and shall have been
advised by such counsel that there may be one or more legal defenses available
to it which are different from or additional to
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those available to the Company (in which case the Company shall not have the
right to assume the defense of such action on behalf of the QIU Indemnified
Party). In any such case, the Company shall not, in connection with any one
action or separate but substantially similar or related actions in the same
jurisdiction arising out of the same general allegations or circumstances, be
liable for the fees and expenses of more than one separate firm of attorneys (in
addition to any local counsel) for all QIU Indemnified Parties, which firm shall
be designated by the QIU, and all such fees and expenses shall be reimbursed as
they are incurred. The Company shall indemnify and hold harmless the QIU
Indemnified Party from and against any and all losses, claims, damages,
liabilities and judgments by reason of any settlement of any action (i) effected
with its written consent or (ii) effected without its written consent if the
settlement is entered into more than twenty business days after the Company
shall have received a request from the QIU Indemnified Party for reimbursement
for the fees and expenses of counsel (in any case where such fees and expenses
are at the expense of the Company) and, prior to the date of such settlement,
the Company shall have failed to comply with such reimbursement request. The
Company shall not, without the prior written consent of the QIU Indemnified
Party, effect any settlement or compromise of, or consent to the entry of
judgment with respect to, any pending or threatened action in respect of which
the QIU Indemnified Party is or could have been a party and indemnity or
contribution may be or could have been sought hereunder by the QIU Indemnified
Party, unless such settlement, compromise or judgment (i) includes an
unconditional release of the QIU Indemnified Party from all liability on claims
that are or could have been the subject matter of such action and (ii) does not
include a statement as to or an admission of fault, culpability or a failure to
act, by or on behalf of the QIU Indemnified Party.
(c) To the extent the indemnification provided for in this Section 8 is
unavailable to a QIU Indemnified Party or insufficient in respect of any losses,
claims, damages, liabilities or judgments referred to therein, then the Company,
in lieu of indemnifying such QIU Indemnified Party, shall contribute to the
amount paid or payable by such QIU Indemnified Party as a result of such losses,
claims, damages, liabilities and judgments (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company on the one
hand and the QIU on the other hand from the offering of the Shares or (ii) if
the allocation provided by clause 8(c)(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 8(c)(i) above but also the relative fault of the
Company on the one hand and the QIU on the other hand in connection with the
statements or omissions which resulted in such losses, claims, damages,
liabilities or judgments, as well as any other relevant equitable
considerations. The relative benefits received by the Company on the one hand
and the QIU on the other hand shall be deemed to be in the same proportion as
the total net proceeds from the offering (before deducting expenses) received by
the Company as set forth in the table on the cover page of the Prospectus, and
the fee received by the QIU pursuant to Section 2 hereof, bear to the sum of
such total net proceeds and such fee. The relative fault of the Company on the
one hand and the QIU on the other hand shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a material
fact or the omission or alleged omission to state a material fact relates to
information supplied by the Company or the QIU and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission and whether the QIU's activities as QIU under its
engagement pursuant to Section 2 hereof involved any willful misconduct or gross
negligence on the part of the QIU.
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The Company and the QIU agree that it would not be just and equitable
if contribution pursuant to this Section 8(c) were determined by pro rata
allocation or by any other method of allocation which does not take account of
the equitable considerations referred to in the immediately preceding paragraph.
The amount paid or payable by a QIU Indemnified Party as a result of the losses,
claims, damages, liabilities or judgments referred to in the immediately
preceding paragraph shall be deemed to include, subject to the limitations set
forth above, legal or other expenses incurred by such QIU Indemnified Party in
connection with investigating or defending any matter, including any action,
that could have given rise to such losses, claims, damages, liabilities or
judgments. 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.
(d) The remedies provided for in this Section 8 are not exclusive and
shall not limit any rights or remedies which may otherwise be available to any
QIU Indemnified Party at law or in equity.
SECTION 9. Indemnification. (a) The Company agrees to indemnify and
hold harmless each Underwriter, its directors, its officers and each person, if
any, who controls any Underwriter within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act, from and against any and all losses, claims,
damages, liabilities and judgments (including, without limitation, any legal or
other expenses incurred in connection with investigating or defending any
matter, including any action, that could give rise to any such losses, claims,
damages, liabilities or judgments) caused by any untrue statement or alleged
untrue statement of a material fact contained in the Registration Statement (or
any amendment thereto), the Prospectus (or any amendment or supplement thereto)
or any preliminary prospectus, or caused by any omission or alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, except insofar as such losses, claims,
damages, liabilities or judgments are caused by any such untrue statement or
omission or alleged untrue statement or omission based upon information relating
to any Underwriter furnished in writing to the Company by such Underwriter
through you expressly for use therein provided, however, that the foregoing
indemnity agreement with respect to any preliminary prospectus shall not inure
to the benefit of any Underwriter who failed to deliver a Prospectus, as then
amended or supplemented, (so long as the Prospectus and any amendment or
supplement thereto was provided by the Company to the several Underwriters in
the requisite quantity and on a timely basis to permit proper delivery on or
prior to the Closing Date) to the person asserting any losses, claims, damages,
liabilities or judgments caused by any untrue statement or alleged untrue
statement of a material fact contained in such preliminary prospectus, or caused
by any omission or alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein not misleading, if
such material misstatement or omission or alleged material misstatement or
omission was cured in the Prospectus, as so amended or supplemented, and such
Prospectus was required by law to be delivered at or prior to the written
confirmation of sale to such person.
Each of the Selling Stockholders severally, and not jointly, agrees to
indemnify and hold harmless each Underwriter, its directors, its officers and
each person, if any, who controls any Underwriter within the meaning of Section
15 of the Act or Section 20 of the Exchange Act, to
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the same extent as the foregoing indemnity, but only with reference to
information relating to such other Selling Stockholder. Notwithstanding the
foregoing, the aggregate liability of each of the Selling Stockholders pursuant
to this Section 9(a) shall be limited to an amount equal to the total proceeds
(before deducting underwriting discounts and commissions and expenses) received
by such Selling Stockholder from the Underwriters for the sale of the Additional
Shares sold by such Selling Stockholder hereunder.
(b) Each Underwriter agrees, severally and not jointly, to indemnify
and hold harmless the Company, its directors, its officers who sign the
Registration Statement, each person, if any, who controls the Company within the
meaning of Section 15 of the Act or Section 20 of the Exchange Act, each Selling
Stockholder and each person, if any, who controls such Selling Stockholder
within the meaning of Section 15 of the Act or Section 20 of the Exchange Act to
the same extent as the foregoing indemnity from the Sellers to such Underwriter
but only with reference to information relating to such Underwriter furnished in
writing to the Company by such Underwriter through you expressly for use in the
Registration Statement (or any amendment thereto), the Prospectus (or any
amendment or supplement thereto) or any preliminary prospectus.
(c) In case any action shall be commenced involving any person in
respect of which indemnity may be sought pursuant to Section 9(a) or 9(b) (the
"indemnified party"), the indemnified party shall promptly notify the person
against whom such indemnity may be sought (the "indemnifying party") in writing
and the indemnifying party shall assume the defense of such action, including
the employment of counsel reasonably satisfactory to the indemnified party and
the payment of all fees and expenses of such counsel, as incurred (except that
in the case of any action in respect of which indemnity may be sought pursuant
to both Sections 9(a) and 9(b), the Underwriter shall not be required to assume
the defense of such action pursuant to this Section 9(c), but may employ
separate counsel and participate in the defense thereof, but the fees and
expenses of such counsel, except as provided below, shall be at the expense of
such Underwriter). Any indemnified party shall have the right to employ separate
counsel in any such action and participate in the defense thereof, but the fees
and expenses of such counsel shall be at the expense of the indemnified party
unless (i) the employment of such counsel shall have been specifically
authorized in writing by the indemnifying party, (ii) the indemnifying party
shall have failed to assume the defense of such action or employ counsel
reasonably satisfactory to the indemnified party or (iii) the named parties to
any such action (including any impleaded parties) include both the indemnified
party and the indemnifying party, and the indemnified party shall have been
advised by such counsel that there may be one or more legal defenses available
to it 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 the indemnified party).
In any such case, the indemnifying party shall not, in connection with any one
action or separate but substantially similar or related actions in the same
jurisdiction arising out of the same general allegations or circumstances, be
liable for (i) the fees and expenses of more than one separate firm of attorneys
(in addition to any local counsel) for all Underwriters, their officers and
directors and all persons, if
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any, who control any Underwriter within the meaning of either Section 15 of the
Act or Section 20 of the Exchange Act, (ii) the fees and expenses of more than
one separate firm of attorneys (in addition to any local counsel) for the
Company, its directors, its officers who sign the Registration Statement and all
persons, if any, who control the Company within the meaning of either such
Section and (iii) the fees and expenses of more than one separate firm of
attorneys (in addition to any local counsel) for all Selling Stockholders and
all persons, if any, who control any Selling Stockholder within the meaning of
either such Section, and all such fees and expenses shall be reimbursed as they
are incurred. In the case of any such separate firm for the Underwriters, their
officers and directors and such control persons of any Underwriters, such firm
shall be designated in writing by CSFB and Xxxxxx. In the case of any such
separate firm for the Company and such directors, officers and control persons
of the Company, such firm shall be designated in writing by the Company. In the
case of any such separate firm for the Selling Stockholders and such control
persons of any Selling Stockholders, such firm shall be designated in writing by
a majority of the Selling Stockholders. The indemnifying party shall indemnify
and hold harmless the indemnified party from and against any and all losses,
claims, damages, liabilities and judgments by reason of any settlement of any
action (i) effected with its written consent or (ii) effected without its
written consent if the settlement is entered into more than twenty business days
after the indemnifying party shall have received a request from the indemnified
party for reimbursement for the fees and expenses of counsel (in any case where
such fees and expenses are at the expense of the indemnifying party) and, prior
to the date of such settlement, the indemnifying party shall have failed to
comply with such reimbursement request. No indemnifying party shall, without the
prior written consent of the indemnified party, effect any settlement or
compromise of, or consent to the entry of judgment with respect to, any pending
or threatened action in respect of which the indemnified party is or could have
been a party and indemnity or contribution may be or could have been sought
hereunder by the indemnified party, unless such settlement, compromise or
judgment (i) includes an unconditional release of the indemnified party from all
liability on claims that are or could have been the subject matter of such
action and (ii) does not include a statement as to or an admission of fault,
culpability or a failure to act, by or on behalf of the indemnified party.
Notwithstanding anything contained herein to the contrary, if indemnity
may be sought pursuant to Section 9(g) hereof in respect of such action or
proceeding, then in addition to such separate firm for the indemnified parties,
the indemnifying party shall be liable for the fees and expenses of not more
than one separate firm (in addition to any local counsel) for DLJSC for the
defense of any losses, claims, damages and liabilities arising out of the
Directed Share Program, and all persons, if any, who control DLJSC within the
meaning of either Section 15 of the Act or Section 20 of the Exchange Act.
(d) To the extent the indemnification provided for in this Section 9 is
unavailable to an indemnified party or insufficient in respect of any losses,
claims, damages, liabilities or judgments referred to therein, then each
indemnifying party, in lieu of indemnifying such indemnified party, shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages, liabilities and judgments (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Sellers on the one hand and the Underwriters on the other hand from the offering
of the Shares or (ii) if the allocation provided by clause 9(d)(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 9(d)(i) above but also the
relative fault of the Sellers on the one hand and the Underwriters on the other
hand in connection with the statements or omissions which resulted in such
losses, claims, damages, liabilities or judgments,
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as well as any other relevant equitable considerations. The relative benefits
received by the Sellers on the one hand and the Underwriters on the other hand
shall be deemed to be in the same proportion as the total net proceeds from the
offering (after deducting underwriting discounts and commissions, but before
deducting expenses) received by the Sellers, and the total underwriting
discounts and commissions received by the Underwriters, bear to the total price
to the public of the Shares, in each case as set forth in the table on the cover
page of the Prospectus. The relative fault of the Sellers on the one hand and
the Underwriters on the other hand shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a material fact
or the omission or alleged omission to state a material fact relates to
information supplied by the Company or the Selling Stockholders on the one hand
or the Underwriters on the other hand and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.
The Sellers and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 9(d) were determined by pro
rata allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take account of the
equitable considerations referred to in the immediately preceding paragraph. The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages, liabilities or judgments referred to in the immediately
preceding paragraph shall be deemed to include, subject to the limitations set
forth above, any legal or other expenses incurred by such indemnified party in
connection with investigating or defending any matter, including any action,
that could have given rise to such losses, claims, damages, liabilities or
judgments. Notwithstanding the provisions of this Section 9, no Underwriter
shall be required to contribute any amount in excess of the amount by which the
total price at which the Shares underwritten by it and distributed to the public
were offered to the public exceeds the amount of any damages 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 to contribute
pursuant to this Section 9(d) are several in proportion to the respective number
of Shares purchased by each of the Underwriters hereunder and not joint.
(e) The remedies provided for in this Section 9 are not exclusive and
shall not limit any rights or remedies which may otherwise be available to any
indemnified party at law or in equity.
(f) Each Selling Stockholder, other than the Jordan Funds, hereby
designates W-H Energy Services, Inc., 00000 Xxxxxxxx Xxxxxx, Xxxxx 000, Xxxxxxx,
Xxxxx, 00000, as its authorized agent, upon which process may be served in any
action which may be instituted in any state or federal court in the State of New
York by any Underwriter, any director or officer of any Underwriter or any
person controlling any Underwriter asserting a claim for indemnification or
contribution under or pursuant to this Section 9, and each Selling Stockholder
will accept the jurisdiction of such court in such action, and waives, to the
fullest extent permitted by applicable law, any defense based upon lack of
personal jurisdiction or venue. Any such process may be served on the Jordan
Funds at the address for notices specified in Section 12 hereof, and a copy
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of any such process referred to in the prior sentence shall be sent or given to
such other Selling Stockholder at the address for notices specified in Section
12 hereof.
(g) The Company agrees to indemnify and hold harmless DLJSC and each of
the other Underwriters, their officers and directors and each person, if any,
who controls DLJSC or any of the other Underwriters within the meaning of either
Section 15 of the Act or Section 20 of the Exchange Act, from and against any
and all losses, claims, damages and liabilities (including, without limitation,
any legal or other expenses reasonably incurred in connection with defending or
investigating any such action or claim) (i) caused by any untrue statement or
alleged untrue statement of a material fact contained in the prospectus wrapper
material prepared by or with the consent of the Company for distribution in
foreign jurisdictions in connection with the Directed Share Program attached to
the Prospectus or any preliminary prospectus, or caused by any omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein, when considered in conjunction with
the Prospectus or any applicable preliminary prospectus, not misleading; (ii)
caused by the failure of any Participant to pay for and accept delivery of the
shares which immediately following the effective date of the Registration
Statement, were subject to a properly confirmed agreement to purchase; or (iii)
related to, arising out of, or in connection with the Directed Share Program,
provided that, the Company shall not be responsible under this subparagraph
(iii) for any losses, claim, damages or liabilities (or expenses relating
thereto) that are finally judicially determined to have resulted from the bad
faith or gross negligence of DLJSC or any of the other Underwriters.
SECTION 10. Conditions of Underwriters' Obligations. The several
obligations of the Underwriters to purchase the Firm Shares under this Agreement
are subject to the satisfaction of each of the following conditions:
(a) All the representations and warranties of the Company contained in
this Agreement shall be true and correct on the Closing Date with the same force
and effect as if made on and as of the Closing Date.
(b) If the Company is required to file a Rule 462(b) Registration
Statement after the effectiveness of this Agreement, such Rule 462(b)
Registration Statement shall have become effective by 10:00 P.M., New York City
time, on the date of this Agreement; and no stop order suspending the
effectiveness of the Registration Statement shall have been issued and no
proceedings for that purpose shall have been commenced or shall be pending
before or contemplated by the Commission.
(c) You and the Selling Stockholders shall have received on the Closing
Date a certificate dated the Closing Date, signed by Xxxxxxx X. Xxxxx, Xx. and
Xxxxxxx X. Xxxxxx, in their capacities as the Chairman and Chief Executive
Officer and Vice President and Chief Financial Officer, respectively, of the
Company, confirming the matters set forth in Sections 6(s), 10(a) and 10(b) and
that the Company has complied with all of the agreements and satisfied all of
the conditions herein contained and required to be complied with or satisfied by
the Company on or prior to the Closing Date.
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(d) Since the respective dates as of which information is given in the
Prospectus other than as set forth in the Prospectus (exclusive of any
amendments or supplements thereto subsequent to the date of this Agreement), (i)
there shall not have occurred any change or any development involving a
prospective change in the business, prospects, financial condition or results of
operations of the Company and its Subsidiaries, taken as a whole, (ii) there
shall not have been any change or any development involving a prospective change
in the capital stock or in the long-term debt of the Company or any of its
Subsidiaries and (iii) neither the Company nor any of its Subsidiaries shall
have incurred any liability or obligation, direct or contingent, the effect of
which, in any such case described in clause 10(d)(i), 10(d)(ii) or 10(d)(iii),
in your judgment, is material and adverse and, in your judgment, makes it
impracticable to market the Shares on the terms and in the manner contemplated
in the Prospectus.
(e) All the representations and warranties of each Selling Stockholder
contained in this Agreement shall be true and correct on any Option Closing Date
with the same force and effect as if made on and as of such Option Closing Date
and you shall have received on such Option Closing Date a certificate dated such
Option Closing Date from each Selling Stockholder to such effect and to the
effect that such Selling Stockholder has complied with all of the agreements and
satisfied all of the conditions herein contained and required to be complied
with or satisfied by such Selling Stockholder on or prior to such Option Closing
Date.
(f) You shall have received on the Closing Date an opinion
(satisfactory to you and counsel for the Underwriters), dated the Closing Date,
of Xxxxxx & Xxxxxx L.L.P., counsel for the Company to the effect that:
(i) each of the Company and its Subsidiaries has been duly
incorporated, is validly existing as a corporation in
good standing under the laws of its jurisdiction of
incorporation and has the corporate power and authority
to carry on its business as described in the Prospectus
and to own, lease and operate its properties;
(ii) each of the Subsidiaries is duly qualified and is in
good standing as a foreign corporation authorized to do
business in each jurisdiction set forth opposite its
name on Annex II hereto;
(iii) all the outstanding shares of capital stock of the
Company have been duly authorized and validly issued
and are fully paid, non-assessable and not subject to
any preemptive or similar rights;
(iv) the Firm Shares to be issued and sold by the Company
hereunder have been duly authorized and, when issued
and delivered to the Underwriters against payment
therefor as provided by this Agreement, will be validly
issued, fully paid and non-assessable, and the issuance
of such Firm Shares will not be subject to any
preemptive or similar rights;
(v) all of the outstanding shares of capital stock of each
of the Company's Subsidiaries have been duly authorized
and validly issued and are fully paid and
non-assessable, and except as described in the
Prospectus, are owned by the
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Company, directly or indirectly through one or more
Subsidiaries, free and clear of any security interest,
claim, lien, encumbrance or adverse interest of any
nature;
(vi) this Agreement has been duly authorized, executed and
delivered by the Company;
(vii) the Registration Statement has become effective under
the Act, no stop order suspending its effectiveness has
been issued and no proceedings for that purpose are, to
the knowledge of such counsel, pending before or
contemplated by the Commission;
(viii) the statements under the captions "Business--Government
Regulation", "Management--Indemnification",
"Management--Employment Agreements", "Management--Stock
Option Plan" and "Description of Capital Stock" in the
Prospectus and Item 14 of Part II of the Registration
Statement, insofar as such statements constitute a
summary of the legal matters, documents or proceedings
referred to therein, are accurate in all material
respects;
(ix) the execution, delivery and performance of this
Agreement by the Company, the compliance by the Company
with all the provisions hereof and the consummation of
the transactions contemplated hereby will not (A)
require any consent, approval, authorization or other
order of, or qualification with, any court or
governmental body or agency (except such as may be
required under the securities or Blue Sky laws of the
various states), (B) constitute a breach of any of the
terms or provisions of, or a default under, the charter
or by-laws of the Company or any of its Subsidiaries or
any indenture, loan agreement, mortgage, lease or other
agreement or instrument filed as an Exhibit to the
Registration Statement, (C) violate any applicable law
or any rule, regulation, judgment, order or decree of
any court or any governmental body or agency having
jurisdiction over the Company, any of its Subsidiaries
or their respective property; provided, however, that
no opinion is given in this paragraph as to any
securities laws or (D) result in the suspension,
termination or revocation of any Authorization of the
Company or any of its Subsidiaries or any other
impairment of the rights of the holder of any such
Authorization;
(x) to such counsel's knowledge, there are no legal or
governmental proceedings pending or threatened to which
the Company or any of its Subsidiaries is or could be a
party or to which any of their respective property is
or could be subject that are required to be described
in the Registration Statement or the Prospectus and are
not so described, or of any contracts or other
documents that are required to be described in the
Registration Statement or the Prospectus or to be filed
as exhibits to the Registration Statement that are not
so described or filed as required;
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(xi) the Company is not and, after giving effect to the
offering and sale of the Shares and the application of
the proceeds thereof as described in the Prospectus,
will not be, an "investment company" as such term is
defined in the Investment Company Act of 1940, as
amended;
(xii) to such counsel's knowledge, there are no contracts or
agreements 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 or to require the Company
to include such securities with the Shares registered
pursuant to the Registration Statement, except those
disclosed in the Prospectus and as to which the Company
has received waivers;
(xiii) the offer, sale and issuance of the equity securities
of the Company described in Item 15 of Part II of the
Registration Statement occurring within one year of the
date of this Agreement constitute transactions exempt
from the registration requirements of the Act;
(xiv) the Exchange Agreement has been duly authorized,
executed and delivered by the Company and constitutes a
valid and binding agreement of the Company enforceable
against the Company in accordance with its terms,
except as such enforceability may be limited by
bankruptcy, insolvency, reorganization, moratorium and
other similar laws mow or hereinafter in effect
relating to or affecting creditors' rights generally
and to general principles of equity (regardless of
whether such enforceability is considered in a
proceeding in equity or at law); and
(xv) the Amendment Agreement has been duly authorized by the
Company, and upon execution thereof by the parties
thereto on the Closing Date, will be duly executed and
delivered and will constitute a valid and binding
agreement of the Company enforceable against the
Company in accordance with its terms, except as such
enforceability may be limited by bankruptcy,
insolvency, reorganization, moratorium and other
similar laws mow or hereinafter in effect relating to
or affecting creditors' rights generally and to general
principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity
or at law).
The Underwriters will also be entitled to rely on the opinion of such
counsel, dated the Closing Date, delivered to the lenders under the New Credit
Facility relating to the due authorization, execution, delivery and
enforceability of such New Credit Facility.
In addition, such counsel shall state that in the course of the
preparation by the Company of the Registration Statement and the Prospectus such
counsel participated in conferences with officers and other representatives of
the Company and the Underwriters, with representatives of counsel for the
Underwriters and with representatives of the auditors of the Company, at which
conferences the contents of the Registration Statement and the Prospectus and
related matters were discussed. Such counsel shall also state that, although
they have not undertaken to
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determine independently, and do not assume any responsibility for, or express
any opinion regarding, the accuracy, completeness or fairness of the statements
contained in the Registration Statement and the Prospectus (except to the extent
specified in the foregoing opinions), based on the participation described above
(relying as to factual matters in respect of the determination of materiality to
a significant extent upon statements of fact made to such counsel by
representatives of the Company), and subject to the next succeeding sentence, no
information has come to such counsel's attention that causes such counsel to
believe that (a) the Registration Statement, at the time it became effective,
and the Prospectus as of its date and the Closing Date, did not comply as to
form in all material respects with the Act, (b) the Registration Statement, at
the time it became effective and on the date of this Agreement, contained an
untrue statement of a material fact or omitted to state a material fact
necessary in order to make the statements therein not misleading and (c) the
Prospectus, as of its Date and the Closing Date, contained an untrue statement
of a material fact or omitted to state a material fact necessary in order to
make the statements therein, in the light of the circumstances under which they
were made, not misleading. In making the foregoing statement, such counsel may
state that they do not express any comment or belief with respect to the
financial statements, the notes thereto or the other financial and related
statistical data contained in the Registration Statement or the Prospectus.
Because not all of the United States legal concepts to be addressed in
the opinions set forth in paragraphs 10(f)(i), 10(f)(ii), 10(f)(v), 10(f)(ix)
and 10(f)(x) above are not identical to those of the United Kingdom and the
Kingdom of Norway, certain parts of such opinion may be qualified with respect
the Pathfinder Energy Services Limited and Pathfinder Energy Services AS.
The opinion of Xxxxxx & Xxxxxx L.L.P. described in Section 10(f) above
shall be rendered to you at the request of the Company and shall so state
therein.
(g) You shall have received on any Option Closing Date an opinion
(satisfactory to you and counsel for the Underwriters), dated such Option
Closing Date, of Xxxxx Xxxxx & Xxxxx on behalf of the Jordan Funds and of
internal counsel on behalf of the DLJMB Funds, in each case to the effect that:
(i) this Agreement has been duly authorized, executed and
delivered or on behalf of each Selling Stockholder;
(ii) each Selling Stockholder is the record owner of the
Additional Shares to be sold by such Selling
Stockholder pursuant to this Agreement and has good and
indefeasible title to such Additional Shares, free of
all restrictions on transfer, liens, encumbrances,
security interests, equities and claims whatsoever;
(iii) each Selling Stockholder has full legal right, power
and authority, and all authorization and approval
required by law, to enter into this Agreement and the
Custody Agreement and to sell, assign, transfer and
deliver the Additional Shares to be sold by such
Selling Stockholder in the manner provided herein and
therein;
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(iv) the Custody Agreement of each Selling Stockholder has
been duly authorized, executed and delivered by such
Selling Stockholder and is a valid and binding
agreement of such Selling Stockholder, enforceable in
accordance with its terms, except as such
enforceability may be limited by bankruptcy,
insolvency, reorganization, moratorium and other
similar laws mow or hereinafter in effect relating to
or affecting creditors' rights generally and to general
principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity
or at law), and except as to the enforceability of the
indemnification provisions contained therein to the
extent they conflict with applicable law;
(v) upon delivery of and payment for the Additional Shares
to be sold by each Selling Stockholder pursuant to this
Agreement, each of the Underwriters shall acquire a
security entitlement (as that term is defined in the
Uniform Commercial Code in effect in the State of New
York (the "NYUCC")), with respect to the Additional
Shares free of any adverse claim (as that term is
defined under the NYUCC), provided that each of the
Underwriters does not have notice of any adverse claim
(within the meaning of Section 8-105 of the NYUCC); and
(vi) the execution, delivery and performance of this
Agreement and the Custody Agreement of each Selling
Stockholder by such Selling Stockholder, the compliance
by such Selling Stockholder with all the provisions
hereof and thereof and the consummation of the
transactions contemplated hereby and thereby will not
(A) require any consent, approval, authorization or
other order of, or qualification with, any court or
governmental body or agency (except such as may be
required under the securities or Blue Sky laws of the
various states), (B) conflict with or constitute a
breach of any of the terms or provisions of, or a
default under, the organizational documents of such
Selling Stockholder, (C) conflict with or constitute a
breach of any of the terms or provisions of, or a
default under, any indenture, loan agreement, mortgage,
lease or other agreement or instrument to which such
Selling Stockholder is a party or by which any property
of such Selling Stockholder is bound or (D) violate or
conflict with any applicable law or any rule,
regulation, judgment, order or decree of any court or
any governmental body or agency having jurisdiction
over such Selling Stockholder or any property of such
Selling Stockholder, except with respect to clauses
(A), (C) and (D) above as would not have a material
adverse effect on such Selling Stockholder's
performance of its obligations hereunder.
Furthermore, you will receive an opinion (satisfactory to you and
counsel for the Underwriters), dated any Option Closing Date, of internal
counsel on behalf of the DLJMB Funds to the effect that the Exchange Agreement
has been duly authorized, executed and delivered on behalf of each of the DLJMB
Funds and constitutes a valid and binding agreement of each of the DLJMB Funds
enforceable against each such fund in accordance with its terms, except as such
enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium and other similar laws mow or hereinafter in effect relating to or
affecting creditors' rights generally and to general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law).
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The opinions of counsel for the Selling Stockholders described in
Section 10(g) above shall be rendered to you at the request of the Company and
the Selling Stockholders and shall so state therein.
(h) You shall have received on the Closing Date an opinion, dated the
Closing Date, of Xxxxxxx & Xxxxx L.L.P., counsel for the Underwriters, as to the
matters referred to in Sections 10(f)(iv), 10(f)(vi), 10(f)(viii) (but only with
respect to the statements under the caption "Description of Capital Stock") and
the paragraph following Section 10(f)(xv).
In giving such opinions with respect to the matters covered by the
paragraph following Section 10(f)(xv), Xxxxxxx & Xxxxx L.L.P. and Xxxxxx &
Xxxxxx L.L.P. may state that their opinion and belief are based upon their
participation in the preparation of the Registration Statement and Prospectus
and any amendments or supplements thereto and review and discussion of the
contents thereof, but are without independent check or verification except as
specified.
(i) You shall have received, on each of the date hereof and the Closing
Date, a letter dated the date hereof or the Closing Date, as the case may be, in
form and substance satisfactory to you, from Xxxxxx Xxxxxxxx LLP, independent
public accountants, containing the information and statements of the type
ordinarily included in accountants' "comfort letters" to Underwriters with
respect to the financial statements and certain financial information contained
in the Registration Statement and the Prospectus.
(j) The Company shall have delivered to you the agreements specified in
Section 2 hereof which agreements shall be in full force and effect on the
Closing Date.
(k) The Shares shall have been duly listed for quotation on the Nasdaq
National Market.
(l) The Company and the Selling Stockholders shall not have failed on
or prior to the Closing Date to perform or comply with any of the agreements
herein contained and required to be performed or complied with by the Company or
the Selling Stockholders, as the case may be, on or prior to the Closing Date.
(m) You shall have received on the Closing Date, a certificate of each
Selling Stockholder who is not a U.S. Person (as defined under applicable U.S.
federal tax legislation) to the effect that such Selling Stockholder is not a
U.S. Person, which certificate may be in the form of a properly completed and
executed United States Treasury Department Form W-8 (or other applicable form or
statement specified by Treasury Department regulations in lieu thereof).
The several obligations of the Underwriters to purchase any Additional
Shares hereunder are subject to the delivery to you on the applicable Option
Closing Date of such documents as you may reasonably request with respect to the
good standing of the Company, the due authorization and issuance of such
Additional Shares and other matters related to the issuance of such Additional
Shares, including without limitation, documents dated as of such Option Closing
Date which are identical to the documents described in Sections 10(c), 10(f),
10(h) and 10(i).
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SECTION 11. Effectiveness of Agreement and Termination. This Agreement
shall become effective upon the execution and delivery of this Agreement by the
parties hereto.
This Agreement may be terminated at any time on or prior to the Closing
Date by you by written notice to the Sellers if any of the following has
occurred: (i) any outbreak or escalation of hostilities or other national or
international calamity or crisis or change in economic conditions or in the
financial markets of the United States or elsewhere that, in your judgment, is
material and adverse and, in your judgment, makes it impracticable to market the
Shares on the terms and in the manner contemplated in the Prospectus, (ii) the
suspension or material limitation of trading in securities or other instruments
on the New York Stock Exchange, the American Stock Exchange, the Chicago Board
of Options Exchange, the Chicago Mercantile Exchange, the Chicago Board of Trade
or the Nasdaq National Market or limitation on prices for securities or other
instruments on any such exchange or the Nasdaq National Market, (iii) the
suspension of trading of any securities of the Company on any exchange or in the
over-the-counter market, (iv) the enactment, publication, decree or other
promulgation of any federal or state statute, regulation, rule or order of any
court or other governmental authority which in your opinion materially and
adversely affects, or will materially and adversely affect, the business,
prospects, financial condition or results of operations of the Company and its
Subsidiaries, taken as a whole, (v) the declaration of a banking moratorium by
either federal or New York State authorities or (vi) the taking of any action by
any federal, state or local government or agency in respect of its monetary or
fiscal affairs which in your opinion has a material adverse effect on the
financial markets in the United States.
If on the Closing Date or on an Option Closing Date, as the case may
be, any one or more of the Underwriters shall fail or refuse to purchase the
Firm Shares or Additional Shares, as the case may be, which it has or they have
agreed to purchase hereunder on such date and the aggregate number of Firm
Shares or Additional Shares, as the case may be, which such defaulting
Underwriter or Underwriters agreed but failed or refused to purchase is not more
than one-tenth of the total number of Firm Shares or Additional Shares, as the
case may be, to be purchased on such date by all Underwriters, each
non-defaulting Underwriter shall be obligated severally, in the proportion which
the number of Firm Shares set forth opposite its name in Schedule I bears to the
total number of Firm Shares which all the non-defaulting Underwriters have
agreed to purchase, or in such other proportion as you may specify, to purchase
the Firm Shares or Additional Shares, as the case may be, which such defaulting
Underwriter or Underwriters agreed but failed or refused to purchase on such
date; provided that in no event shall the number of Firm Shares or Additional
Shares, as the case may be, which any Underwriter has agreed to purchase
pursuant to Section 2 hereof be increased pursuant to this Section 11 by an
amount in excess of one-ninth of such number of Firm Shares or Additional
Shares, as the case may be, without the written consent of such Underwriter. If
on the Closing Date any Underwriter or Underwriters shall fail or refuse to
purchase Firm Shares and the aggregate number of Firm Shares with respect to
which such default occurs is more than one-tenth of the aggregate number of Firm
Shares to be purchased by all Underwriters and arrangements satisfactory to you
and the Company for purchase of such Firm Shares are not made within 48 hours
after such default, this Agreement will terminate without liability on the part
of any non-defaulting Underwriter, the Company or the Selling Stockholders. In
any such case which does not result in termination of this Agreement, either you
or the Company shall
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have the right to postpone the Closing Date, but in no event for longer than
seven days, in order that the required changes, if any, in the Registration
Statement and the Prospectus or any other documents or arrangements may be
effected. If, on an Option Closing Date, any Underwriter or Underwriters shall
fail or refuse to purchase Additional Shares and the aggregate number of
Additional Shares with respect to which such default occurs is more than
one-tenth of the aggregate number of Additional Shares to be purchased on such
date, the non-defaulting Underwriters shall have the option to (i) terminate
their obligation hereunder to purchase such Additional Shares or (ii) purchase
not less than the number of Additional Shares that such non-defaulting
Underwriters would have been obligated to purchase on such date in the absence
of such default. Any action taken under this paragraph shall not relieve any
defaulting Underwriter from liability in respect of any default of any such
Underwriter under this Agreement.
SECTION 12. Agreements of the Selling Stockholders. Each Selling
Stockholder agrees with you and the Company:
(a) To pay or to cause to be paid all transfer taxes payable in
connection with the transfer of the Shares to be sold by such Selling
Stockholder to the Underwriters.
(b) To do and perform all things to be done and performed by such
Selling Stockholder under this Agreement prior to the Closing Date and to
satisfy all conditions precedent to the delivery of the Shares to be sold by
such Selling Stockholder pursuant to this Agreement.
SECTION 13. Miscellaneous. Notices given pursuant to any provision of
this Agreement shall be addressed as follows: (i) if to the Company, to W-H
Energy Services, Inc. 00000 Xxxxxxxx, Xxxxx 000, Xxxxxxx, Xxxxx, 00000, (ii) if
to the Jordan Funds, to The Jordan Company, 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000, Attention: Xxxxxxxx Xxxxxxx, (iii) if to the DLJMB Funds c/o Xxxxxxx X.
Xxxxx, Xx. or Xxxxxxx X. Xxxxxx at the address of the Company set forth above
and (iv) if to any Underwriter or to you, to you c/o Credit Suisse First Boston
Corporation, Eleven Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000-0000, Attention:
Transaction Advisory Group and Xxxxxx Xxxxxxx & Co. Incorporated, 0000 Xxxxxxxx,
Xxx Xxxx, Xxx Xxxx, 00000, Attention: Client Services Group, or in any case to
such other address as the person to be notified may have requested in writing.
The respective indemnities, contribution agreements, representations,
warranties and other statements of the Company, the Selling Stockholders and the
several Underwriters set forth in or made pursuant to this Agreement shall
remain operative and in full force and effect regardless of (i) any
investigation, or statement as to the results thereof, made by or on behalf of
any Underwriter, the officers or directors of any Underwriter, any person
controlling any Underwriter, any QIU Indemnified Party, the Company, the
officers or directors of the Company, any person controlling the Company, any
Selling Stockholder or any person controlling such Selling Stockholder, (ii)
acceptance of the Shares and payment for them hereunder and (iii) termination of
this Agreement.
If for any reason the Shares are not delivered by or on behalf of any
Seller as provided herein (other than as a result of any termination of this
Agreement pursuant to Section 11), the
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Sellers agree, severally, to reimburse the several Underwriters for all
out-of-pocket expenses (including the fees and disbursements of counsel)
incurred by them. Notwithstanding any termination of this Agreement, the Company
shall be liable for all expenses which it has agreed to pay pursuant to Section
5(i) hereof. The Sellers also agree, severally, to reimburse the several
Underwriters, their directors and officers, any persons controlling any of the
Underwriters, and the QIU Indemnified Parties for any and all fees and expenses
(including, without limitation, the fees disbursements of counsel) incurred by
them in connection with enforcing their rights hereunder (including, without
limitation, pursuant to Section 8 hereof).
Except as otherwise provided, this Agreement has been and is made
solely for the benefit of and shall be binding upon the Company, the Selling
Stockholders, the Underwriters, the Underwriters' directors and officers, any
controlling persons referred to herein, the Company's directors and the
Company's officers who sign the Registration Statement and their respective
successors and assigns, all as and to the extent provided in this Agreement, and
no other person shall acquire or have any right under or by virtue of this
Agreement. The term "successors and assigns" shall not include a purchaser of
any of the Shares from any of the several Underwriters merely because of such
purchase.
This Agreement shall be governed and construed in accordance with the
laws of the State of New York.
This Agreement may be signed in various counterparts which together
shall constitute one and the same instrument.
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Please confirm that the foregoing correctly sets forth the agreement
among the Company, the Selling Stockholders and the several Underwriters.
Very truly yours,
W-H ENERGY SERVICES, INC.
By: /s/ Xxxxxxx X. Tempera
--------------------------------------------------
Name: Xxxxxxx X. Tempera
Title: Vice President and
Chief Financial Officer
W-H INVESTMENT, L.P.
W-H INVESTMENT II, G.P.
By: W-H Investment, Inc.
as General Partner
By: /s/ Xxxxxxxx X. Xxxxxxx
--------------------------------------------------
Name: Xxxxxxxx X. Xxxxxxx
Title: President
DLJ MERCHANT BANKING PARTNERS II, L.P.
By: DLJ MERCHANT BANKING II, INC.,
Managing General Partner
By: /s/ Xxx X. Xxxxx
--------------------------------------------------
Name: Xxx X. Xxxxx
Title: Principal
DLJ MERCHANT BANKING PARTNERS II-A, L.P.
By: DLJ MERCHANT BANKING II, INC.,
Managing General Partner
By: /s/ Xxx X. Xxxxx
--------------------------------------------------
Name: Xxx X. Xxxxx
Title: Principal
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DLJ OFFSHORE PARTNERS II, C.V.
By: DLJ MERCHANT BANKING II, INC.,
Managing General Partner
By: /s/ Xxx X. Xxxxx
--------------------------------------------------
Name: Xxx X. Xxxxx
Title: Principal
DLJ DIVERSIFIED PARTNERS, L.P.
By: DLJ DIVERSIFIED PARTNERS, INC.,
Managing General Partner
By: /s/ Xxx X. Xxxxx
--------------------------------------------------
Name: Xxx X. Xxxxx
Title: Principal
DLJ DIVERSIFIED PARTNERS-A, L.P.
By: DLJ DIVERSIFIED PARTNERS, INC.,
Managing General Partner
By: /s/ Xxx X. Xxxxx
--------------------------------------------------
Name: Xxx X. Xxxxx
Title: Principal
DLJMB FUNDING II, INC.
By: DLJMB FUNDING, INC.
By: /s/ Xxx X. Xxxxx
--------------------------------------------------
Name: Xxx X. Xxxxx
Title: Principal
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DLJ MILLENNIUM PARTNERS, L.P.
By: DLJ MERCHANT BANKING II, INC.,
Managing General Partner
By: /s/ Xxx X. Xxxxx
--------------------------------------------------
Name: Xxx X. Xxxxx
Title: Principal
DLJ MILLENNIUM PARTNERS-A, L.P.
By: DLJ MERCHANT BANKING II, INC.,
Managing General Partner
By: /s/ Xxx X. Xxxxx
--------------------------------------------------
Name: Xxx X. Xxxxx
Title: Principal
DLJ EAB PARTNERS, L.P.
By: DLJ LBO PLANS MANAGEMENT CORPORATION,
General Partner
By: /s/ Xxx X. Xxxxx
--------------------------------------------------
Name: Xxx X. Xxxxx
Title: Principal
UK INVESTMENT PLAN 1997 PARTNERS
By: UK INVESTMENT PLAN 1997 PARTNERS, INC.,
General Partner
By: /s/ Xxx X. Xxxxx
--------------------------------------------------
Name: Xxx X. Xxxxx
Title: Principal
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DLJ ESC II L.P.
By: DLJ LBO PLANS MANAGEMENT CORPORATION,
as General Partner
By: /s/ Xxx X. Xxxxx
--------------------------------------------------
Name: Xxx X. Xxxxx
Title: Principal
DLJ FIRST ESC L.P.
By: DLJ LBO PLANS MANAGEMENT CORPORATION,
General Partner
By: /s/ Xxx X. Xxxxx
--------------------------------------------------
Name: Xxx X. Xxxxx
Title: Principal
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CREDIT SUISSE FIRST BOSTON CORPORATION
XXXXXX XXXXXXX & CO. INCORPORATED
XXXXXXXXX, LUFKIN & XXXXXXXX
SECURITIES CORPORATION
UBS WARBURG LLC
XXXXXXX & COMPANY INTERNATIONAL
DLJ DIRECT INC.
Acting severally on behalf of
themselves and the several
Underwriters named in
Schedule I hereto
By: CREDIT SUISSE FIRST
BOSTON CORPORATION
-----------------------------------------
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SCHEDULE I
Number of Firm Shares
Underwriters to be Purchased
------------ ----------------------
Credit Suisse First Boston Corporation 2,892,500
Xxxxxx Xxxxxxx & Co. Incorporated 2,892,500
Xxxxxxxxx, Lufkin & Xxxxxxxx
Securities Corporation 1,112,500
UBS Warburg LLC 1,001,250
Xxxxxxx & Company International 1,001,250
DLJdirect Inc. 100,000
Xxxxxx X. Xxxxx & Co. Incorporated 100,000
Chatsworth Securities LLC 100,000
First Union Securities, Inc. 100,000
Invemed Associates, Inc. 100,000
Xxxxxxxx & Company, Inc. 100,000
Xxxxxx X. Xxxxx & Co., L.P. 100,000
PaineWebber Incorporated 100,000
Xxxxxxx Xxxxx & Associates, Inc. 100,000
Xxxxxxx Xxxxxx Xxxxx Inc. 100,000
---------
Total 10,000,000
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SCHEDULE II
Selling Stockholders
Number of Additional Shares
Name Being Sold
---- ----------
DLJMB Funds
DLJ Merchant Banking Partners II, L.P. 367,984
DLJ Merchant Banking Partners II-A, L.P. 14,654
DLJ Offshore Partners II, C.V. 18,095
DLJ Diversified Partners, L.P. 21,517
DLJ Diversified Partners-A, L.P. 7,991
DLJMB Funding II, Inc. 54,149
DLJ Millennium Partners, L.P. 5,949
DLJ Millennium Partners-A, L.P. 1,160
DLJ EAB Partners, L.P. 1,653
UK Investment Plan 1997 Partners 9,734
DLJ ESC II L.P. 80,578
DLJ First ESC L.P. 706
----------
Total for DLJMB Funds 584,170
Jordan Funds
W-H Investment, L.P. 457,915
W-H Investment II, G.P. 457,915
-------
Total for Jordan Funds 915,830
-------
Total 1,500,000
=========
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ANNEX I
Xxxxxxxx, Xxxx
DLJ Merchant Banking Partners II, L.P.
DLJ Merchant Banking Partners II-A, L.P.
DLJ Offshore Partners II, C.V.
DLJ Diversified Partners, L.P.
DLJ Diversified Partners-A, L.P.
DLJMB Funding II, Inc.
DLJ Millennium Partners, L.P.
DLJ Millennium Partners-A, L.P.
DLJ EAB Partners, L.P.
UK Investment Plan 1997 Partners
DLJ ESC II L.P.
DLJ First ESC X.X.
Xxxxxx, Xx.,Xxxxxxx Xxx
Xxxxxx, Xxxxx X.
Xxxxx, Xxxxxxx X.
Xxxxxxx, Xxxxx
Invesco English and International Trust
North Atlantic Smaller Companies Trust
PSD Operating X.X.
Xxxx, Xxxxxx X.
RBSI Custody Bank Limited
Xxxxxxx, Xxxxxx X.
Xxxxxxxx, Xxxx X.
Xxxxxx, III, Xxxxxxx X.
Xxxxxx, Xx., X. X.
Xxxxxx Management Corporation
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ANNEX II
W-H Energy Services, Inc.
and its Subsidiaries
Jurisdiction of Foreign Jurisdictions in
Name Incorporation Which Qualified
---- ------------- ---------------
W-H Energy Services, Inc. Texas none
Agri-Empresa, Inc. Texas New Mexico
Agri-Empresa Transportation, Inc. Texas none
Xxxxxxx Xxxxxxx, Inc. Louisiana none
Diamond Wireline Services, Inc. Texas none
Drill Motor Services, Inc. Louisiana Oklahoma
Dyna Drill Technologies, Inc. Texas none
Grinding and Sizing Company, Inc. Texas none
Integrity Industries, Inc. Texas Louisiana
Pathfinder Energy Services, Inc. Louisiana Texas
Pathfinder Energy Services Limited England none
Pathfinder Energy Services AS Norway none
Perf-O-Log, Inc. Texas Louisiana
STG Transportation, Inc. Texas none
Xxxxxx Energy Services, Inc. Louisiana Texas
Well Safe, Inc. Texas Alabama; Louisiana
W-H Drilling Solutions, Inc. Texas none
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