Exhibit 1
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MEMC ELECTRONIC MATERIALS, INC.
(a Delaware corporation)
22,000,000 Shares of Common Stock
UNDERWRITING AGREEMENT
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Dated: May 15, 2003
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Table of Contents
Page
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UNDERWRITING AGREEMENT ....................................................... 1
SECTION 1. Representations and Warranties .................................... 3
(a) Representations and Warranties by the Company ..................... 3
(i) Compliance with Registration Requirements ..................... 3
(ii) Incorporated Documents ....................................... 4
(iii) Independent Accountants ..................................... 4
(iv) Financial Statements ......................................... 4
(v) No Material Adverse Change in Business ........................ 5
(vi) Good Standing of the Company ................................. 5
(vii) Good Standing of Subsidiaries ............................... 5
(viii) Capitalization ............................................. 6
(ix) Authorization of Agreement ................................... 6
(x) Authorization and Description of Securities ................... 6
(xi) Absence of Defaults and Conflicts ............................ 6
(xii) Absence of Labor Dispute .................................... 7
(xiii) Absence of Proceedings ..................................... 7
(xiv) Accuracy of Exhibits ........................................ 7
(xv) Possession of Intellectual Property .......................... 7
(xvi) Absence of Further Requirements ............................. 8
(xvii) Possession of Licenses and Permits ......................... 8
(xviii) Title to Property ......................................... 8
(xix) Investment Company Act ...................................... 9
(xx) Environmental Laws ........................................... 9
(xxi) Statistical Data ............................................ 9
(xxii) No Brokers' Fees ........................................... 9
(xxiii) Registration Rights ....................................... 10
(xxiv) Related Party Transactions ................................. 10
(xxv) ERISA ....................................................... 10
(xxvi) Tax Returns ................................................ 10
(xxvii) Disclosure Controls and Procedures ........................ 10
(xxviii) Evaluation of Disclosure Controls and Procedures ......... 11
(xxix) Absence of Significant Changes in Internal Controls ........ 11
(b) Representations and Warranties by the Selling Stockholder ......... 11
(i) Accurate Disclosure ........................................... 11
(ii) Authorization of Agreements .................................. 11
(iii) Good and Valid Title ........................................ 12
(iv) Absence of Manipulation ...................................... 12
(v) Absence of Further Requirements ............................... 12
(vi) Restriction on Sale of Securities ............................ 12
(c) Officer's Certificates ............................................ 13
SECTION 2. Sale and Delivery to Underwriters; Closing. ....................... 13
i
(a) Initial Securities .............................................. 13
(b) Option Securities. .............................................. 13
(c) Payment ......................................................... 14
(d) Denominations; Registration ..................................... 14
SECTION 3. Covenants of the Company ........................................ 14
(a) Compliance with Securities Regulations and Commission Requests .. 14
(b) Filing of Amendments ............................................ 15
(c) Delivery of Registration Statements ............................. 15
(d) Delivery of Prospectuses ........................................ 15
(e) Continued Compliance with Securities Laws ....................... 16
(f) Blue Sky Qualifications ......................................... 16
(g) Rule 158 ........................................................ 16
(h) Use of Proceeds ................................................. 16
(i) Listing ......................................................... 16
(j) Restriction on Sale of Securities ............................... 17
(k) Reporting Requirements .......................................... 17
SECTION 4. Payment of Expenses ............................................. 17
(a) Expenses ........................................................ 17
(b) Expenses of the Selling Stockholder ............................. 18
(c) Termination of Agreement ........................................ 18
(d) Allocation of Expenses .......................................... 18
SECTION 5. Conditions of Underwriters' Obligations ......................... 18
(a) Effectiveness of Registration Statement ......................... 18
(b) No Material Misstatement or Omission ............................ 18
(c) Corporate Proceedings ........................................... 19
(d) Opinion of Counsel for Company .................................. 19
(e) Opinion of Senniger, Powers, Xxxxxxx & Xxxxxx ................... 19
(f) Opinion of Abe, Ikubo & Katayama ................................ 19
(g) Opinion of Hwang Mok Park P.C. .................................. 19
(h) Opinion of Studio Legale Tosato ................................. 19
(i) Opinion of Counsel for the Selling Stockholder .................. 19
(j) Opinion of Counsel for Underwriters ............................. 19
(k) Officers' Certificate ........................................... 20
(l) Certificate of Selling Stockholder .............................. 20
(m) Accountant's Comfort Letter ..................................... 20
(n) Bring-down Comfort Letter ....................................... 20
(o) Approval of Listing ............................................. 21
(p) No Objection .................................................... 21
(q) Lock-up Agreements .............................................. 21
(r) Conditions to Purchase of Option Securities ..................... 21
(s) No Material Adverse Change ...................................... 22
(t) Additional Documents ............................................ 22
(u) Termination of Agreement ........................................ 23
SECTION 6. Indemnification ................................................. 23
(a) Indemnification of Underwriters ................................. 23
(b) Indemnification of Underwriters by the Selling Stockholder ...... 24
ii
(c) Indemnification of Company, Directors and Officers and Selling
Stockholder ...................................................... 25
(d) Actions against Parties; Notification ............................ 25
(e) Information Furnished by Underwriters. ........................... 26
(f) Settlement without Consent if Failure to Reimburse ............... 26
(g) Other Agreements with Respect to Indemnification ................. 26
SECTION 7. Contribution ..................................................... 26
SECTION 8. Representations, Warranties and Agreements to Survive Delivery ... 28
SECTION 9. Termination of Agreement ......................................... 28
(a) Termination; General ............................................. 28
(b) Liabilities ...................................................... 29
SECTION 10. Default by One or More of the Underwriters ....................... 29
SECTION 11. Default by the Selling Stockholder or the Company ................ 29
SECTION 12. Notices .......................................................... 30
SECTION 13. Counterparts ..................................................... 30
SECTION 14. Parties .......................................................... 30
SECTION 15. GOVERNING LAW AND TIME ........................................... 31
SECTION 16. Effect of Headings ............................................... 31
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SCHEDULES
Schedule 1 - List of Underwriters ............................... Sch 1-1
Schedule 2 - Allocation of Securities to be Sold ................ Sch 2-1
Schedule 3 - Pricing Information ................................ Sch 3-1
Schedule 4 - List of Subsidiaries ............................... Sch 4-1
Schedule 5 - List of Persons subject to Lock-up ................. Sch 5-1
EXHIBITS
Exhibit A - Form of Opinion of Company's Counsel ..................... A-1
Exhibit B - Form of Opinion of Senniger, Powers, Xxxxxxx & Xxxxxx .... X-0
Xxxxxxx X - Xxxx Xxxxxxx of Abe, Ikubo & Katayama .................... C-1
Exhibit D - Form of Opinion of Hwang Mok Park P.C. ................... D-1
Exhibit E - Form of Opinion of Studio Legale Tosato .................. E-1
Exhibit F - Form of Opinion of Counsel for the Selling Stockholder.... F-1
Exhibit G - Form of Lock-up Letter ................................... G-1
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MEMC ELECTRONIC MATERIALS, INC.
(a Delaware corporation)
22,000,000 Shares of Common Stock
(Par Value $.01 Per Share)
UNDERWRITING AGREEMENT
----------------------
May 15, 2003
XXXXXX BROTHERS INC.
XXXXXXX XXXXX & CO.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
CITIGROUP GLOBAL MARKETS INC.
DEUTSCHE BANK SECURITIES INC.
UBS WARBURG LLC
as Representatives of the several Underwriters
c/x Xxxxxx Brothers Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
x/x Xxxxxxx Xxxxx & Xx.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
Xxxxx Xxxxx
Xxxxx Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Ladies and Gentlemen:
MEMC Electronic Materials, Inc., a Delaware corporation (the "Company"),
and TPG Wafer Holdings LLC, a Delaware limited liability company (the "Selling
Stockholder"), confirm their respective agreements with Xxxxxx Brothers Inc.
("Xxxxxx Brothers"), Xxxxxxx Xxxxx & Co., Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated ("Xxxxxxx Xxxxx"), Citigroup Global Markets Inc. ("Citigroup"),
Deutsche Bank Securities Inc. ("Deutsche Bank"), UBS Warburg LLC ("UBS") and
each of the other Underwriters named in Schedule 1 hereto (collectively, the
"Underwriters", which term shall also include any underwriter substituted as
hereinafter provided in Section 10 hereof), for whom Xxxxxx Brothers, Merrill
Lynch, Citigroup, Deutsche
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Bank and UBS are acting as representatives (in such capacity, the
"Representatives"), with respect to (i) the sale by the Company and the Selling
Stockholder, acting severally and not jointly, and the purchase by the
Underwriters, acting severally and not jointly, of the respective numbers of
shares of Common Stock, par value $.01 per share, of the Company ("Common
Stock") set forth in said Schedules 1 and 2 hereto and (ii) the grant by the
Selling Stockholder to the Underwriters of the option described in Section 2(b)
hereof to purchase all or any part of 3,300,000 additional shares of Common
Stock to cover over-allotments, if any. The aforesaid 22,000,000 shares of
Common Stock (the "Initial Securities") to be purchased by the Underwriters and
all or any part of the 3,300,000 shares of Common Stock subject to the option
described in Section 2(b) hereof (the "Option Securities") are hereinafter
called, collectively, the "Securities".
The Company and the Selling Stockholder understand that the Underwriters
propose to make a public offering of the Securities as soon as the
Representatives deem advisable after this Agreement has been executed and
delivered.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (No. 333-104529) covering the
registration of the Securities under the Securities Act of 1933, as amended (the
"1933 Act"). The registration statement includes a base prospectus prepared in
accordance with Rule 415 under the 1933 Act relating to the Securities and the
offering thereof from time to time in accordance with Rule 415 of the rules and
regulations of the Commission under the 1933 Act (the "1933 Act Regulations").
Such registration statement has been declared effective by the Commission. As
provided in Section 3(a), a prospectus supplement reflecting the terms of the
offered Securities, the terms of the offering thereof and the other matters set
forth herein will be prepared and filed pursuant to Rule 424 of the 1933 Act
Regulations. Such prospectus supplement, in the form first filed after the date
hereof pursuant to Rule 424, is herein referred to as the "Prospectus
Supplement". Such registration statement (as so amended, if applicable),
including the exhibits thereto, schedules thereto, if any, and the documents
incorporated by reference therein pursuant to Item 12 of Form S-3 under the 1933
Act, is herein called the "Registration Statement." Any registration statement
filed pursuant to Rule 462(b) of the 1933 Act Regulations is herein referred to
as the "Rule 462(b) Registration Statement," and after such filing the term
"Registration Statement" shall include the Rule 462(b) Registration Statement.
The base prospectus included in the Registration Statement relating to all
offerings of Securities under the Registration Statement, as supplemented by the
Prospectus Supplement relating to the offering of the Securities, in the form
first furnished to the Underwriters by the Company for use in connection with
the offering of the Securities, is herein called the "Prospectus", except that,
if such base prospectus is amended or supplemented on or prior to the date on
which the Prospectus Supplement is first filed pursuant to Rule 424, the term
"Prospectus" shall refer to the base prospectus, as so amended or supplemented
and as supplemented by the Prospectus Supplement, in either case including all
documents incorporated by reference therein. Promptly after execution and
delivery of this Agreement, the Company will prepare a Prospectus Supplement
that complies with the 1933 Act and that sets forth the number of offered
Securities, the names of the Underwriters, the price at which the offered
Securities are to be purchased by the Underwriters from the Company and the
Selling Stockholder, the public offering price, any selling concession and
reallowance, and such other information as the Underwriters, the Company and the
Selling Stockholder deem appropriate in connection with the offering of the
offered Securities. The Company will
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promptly transmit copies of the Prospectus Supplement to the Commission for
filing pursuant Rule 424 under the 1933 Act. For purposes of this Agreement, all
references to the Registration Statement, any preliminary prospectus (which, for
purposes of this Agreement, includes any preliminary prospectus supplement
specifically relating to the offering of the Securities together with the base
prospectus), the Prospectus or the Prospectus Supplement or any amendment or
supplement to any of the foregoing shall be deemed to include the copy filed
with the Commission pursuant to its Electronic Data Gathering, Analysis and
Retrieval system ("XXXXX").
All references in this Agreement to financial statements and schedules and
other information which is "contained," "included" or "stated" in the
Registration Statement, any preliminary prospectus or the Prospectus (or other
references of like import) shall be deemed to mean and include all such
financial statements and schedules and other information which is incorporated
by reference in the Registration Statement, any preliminary prospectus or the
Prospectus, as the case may be; and all references in this Agreement to
amendments or supplements to the Registration Statement, any preliminary
prospectus or the Prospectus shall be deemed to mean and include the filing of
any document under the Securities Exchange Act of 1934 (the "1934 Act") which is
incorporated by reference in the Registration Statement, such preliminary
prospectus or the Prospectus, as the case may be.
SECTION 1. Representations and Warranties.
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(a) Representations and Warranties by the Company. The Company represents
and warrants to each Underwriter as of the date hereof, as of the Closing Time
referred to in Section 2(c) hereof, and as of each Date of Delivery (if any)
referred to in Section 2(b) hereof, and agrees with each Underwriter, as
follows:
(i) Compliance with Registration Requirements. The Company meets the
requirements for use of Form S-3 under the 1933 Act. Each of the Registration
Statement and any Rule 462(b) Registration Statement has become effective under
the 1933 Act and no stop order suspending the effectiveness of the Registration
Statement or any Rule 462(b) Registration Statement has been issued under the
1933 Act and no proceedings for that purpose have been instituted or are pending
or, to the knowledge of the Company, are contemplated by the Commission, and any
request on the part of the Commission for additional information has been
complied with.
At the respective times the Registration Statement, any Rule 462(b)
Registration Statement and any post-effective amendments thereto became
effective and at the Closing Time (and, if any Option Securities are purchased,
at the Date of Delivery), the Registration Statement, the Rule 462(b)
Registration Statement and any amendments and supplements thereto complied and
will comply in all material respects with the requirements of the 1933 Act and
the 1933 Act Regulations and did not and will not as of such times contain an
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not misleading.
Neither the Prospectus nor any amendments or supplements thereto, at the time
the Prospectus or any such amendment or supplement was issued and at the Closing
Time (and, if any Option Securities are purchased, at the Date of Delivery),
included or will
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include as of such times an untrue statement of a material fact or omitted or
will omit to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading. The representations and warranties in this subsection shall not
apply to statements in or omissions from the Registration Statement or
Prospectus made in reliance upon and in conformity with information furnished to
the Company in writing by any Underwriter through Xxxxxx Brothers or Xxxxxxx
Xxxxx expressly for use in the Registration Statement or Prospectus.
Each preliminary prospectus and the prospectus filed as part of the
Registration Statement as originally filed or as part of any amendment thereto,
or filed pursuant to Rule 424 under the 1933 Act, complied when so filed in all
material respects with the 1933 Act Regulations and each preliminary prospectus
and the Prospectus delivered to the Underwriters for use in connection with this
offering was identical to the electronically transmitted copies thereof filed
with the Commission pursuant to XXXXX, except to the extent permitted by
Regulation S-T.
(ii) Incorporated Documents. The documents incorporated or deemed to be
incorporated by reference in the Registration Statement and the Prospectus, when
they became effective or at the time they were or hereafter are filed with the
Commission, complied and will comply as of such times in all material respects
with the requirements of the 1933 Act and the 1933 Act Regulations or the 1934
Act and the rules and regulations of the Commission thereunder (the "1934 Act
Regulations"), as applicable, and, when read together with the other information
in the Prospectus, at the time the Registration Statement became effective, at
the time the Prospectus was issued and at the Closing Time (and if any Option
Securities are purchased, at the Date of Delivery), did not and will as of such
times not contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading.
(iii) Independent Accountants. The accountants who certified the financial
statements and supporting schedules included in the Registration Statement and
the Prospectus are independent public accountants as required by the 1933 Act
and the 1933 Act Regulations.
(iv) Financial Statements. The financial statements included in the
Registration Statement and the Prospectus, together with the related schedules
and notes, present fairly the financial position of the Company and its
consolidated Subsidiaries at the dates indicated and the statement of
operations, stockholders' equity and cash flows of the Company and its
consolidated Subsidiaries for the periods specified; said financial statements
have been prepared in conformity with generally accepted accounting principles
as applied in the United States ("GAAP") with respect to the Company's
consolidated financial statements and condensed financial information and
generally accepted accounting principles applied in the Republic of China with
respect to Taisil Electronic Materials Corporation's financial statements, in
each case applied on a consistent basis throughout the periods involved except
as otherwise disclosed in such financial statements. The supporting schedules,
if any, included in the Registration Statement and Prospectus present fairly in
accordance with GAAP the information
4
required to be stated therein. The selected financial data and the summary
financial information included in the Prospectus present fairly the information
shown therein and have been compiled on a basis consistent with that of the
audited financial statements included in the Registration Statement.
(v) No Material Adverse Change in Business. Since the respective dates as
of which information is given in the Registration Statement and the Prospectus,
except as otherwise stated therein, (A) there has been no material adverse
change in the condition, financial or otherwise, or in the earnings, business
affairs or business prospects of the Company and its Subsidiaries considered as
one enterprise, whether or not arising in the ordinary course of business (a
"Material Adverse Effect"), (B) there have been no transactions entered into by
the Company or any of its Subsidiaries, other than those in the ordinary course
of business, which are material with respect to the Company and its Subsidiaries
considered as one enterprise, and (C) there has been no dividend or distribution
of any kind declared, paid or made by the Company on any class of its capital
stock. Neither the Company nor any of its Subsidiaries has sustained, since the
date of the latest audited financial statements included or incorporated by
reference in the Prospectus, any loss or interference with its business from
fire, explosion, flood or other calamity, whether or not covered by insurance,
or from any labor dispute or court or governmental action, order or decree which
may reasonably be expected to result in a Material Adverse Effect, otherwise
than as set forth or contemplated in the Prospectus; and, since such date, there
has not been any change in the capital stock or long-term debt of the Company or
any of its Subsidiaries otherwise than as set forth or contemplated in the
Prospectus.
(vi) Good Standing of the Company. The Company has been duly organized and
is validly existing as a corporation in good standing under the laws of the
State of Delaware and has corporate power and authority to own, lease and
operate its properties and to conduct its business as described in the
Prospectus and to enter into and perform its obligations under this Agreement;
and the Company is duly qualified as a foreign corporation to transact business
and is in good standing in each other jurisdiction in which such qualification
is required, whether by reason of the ownership or leasing of property or the
conduct of business, except where the failure so to qualify or to be in good
standing would not result in a Material Adverse Effect.
(vii) Good Standing of Subsidiaries. Each "significant subsidiary" of the
Company (as such term is defined in Rule 1-02 of Regulation S-X) (each a
"Significant Subsidiary" and, collectively, the "Significant Subsidiaries") has
been duly organized and is validly existing as a corporation in good standing
under the laws of the jurisdiction of its incorporation or organization, has
corporate or organizational power and authority to own, lease and operate its
properties and to conduct its business as described in the Prospectus and is
duly qualified as a foreign corporation or limited liability company to transact
business and is in good standing in each jurisdiction in which such
qualification is required, whether by reason of the ownership or leasing of
property or the conduct of business, except where the failure so to qualify or
to be in good standing would not result in a Material Adverse Effect; except as
otherwise disclosed in the Registration Statement, all of the issued and
outstanding capital stock of each such Significant Subsidiary has
5
been duly authorized and validly issued, is fully paid and non-assessable and is
owned by the Company, directly or through subsidiaries, free and clear of any
security interest, mortgage, pledge, lien, encumbrance, claim or equity, except
for the security interests in such capital stock granted to certain lenders,
noteholders and guarantors as described in the Prospectus; none of the
outstanding shares of capital stock of any Significant Subsidiary was issued in
violation of the preemptive or similar rights of any securityholder of such
Significant Subsidiary. The only subsidiaries of the Company are the
subsidiaries listed on Schedule 4 hereto (each a "Subsidiary" and, collectively,
the "Subsidiaries").
(viii) Capitalization. The authorized, issued and outstanding capital stock
of the Company is as set forth in the Prospectus in the column entitled "Actual"
under the caption "Capitalization" (except for subsequent issuances, if any,
pursuant to this Agreement, pursuant to reservations, agreements or employee
benefit plans referred to in the Prospectus or pursuant to the exercise of
convertible securities, options or warrants referred to in the Prospectus). The
shares of issued and outstanding capital stock of the Company have been duly
authorized and validly issued and are fully paid and non-assessable; none of the
outstanding shares of capital stock of the Company was issued in violation of
the preemptive or other similar rights of any securityholder of the Company.
(ix) Authorization of Agreement. This Agreement has been duly authorized,
executed and delivered by the Company.
(x) Authorization and Description of Securities. The Securities have been
duly authorized for issuance and sale to the Underwriters pursuant to this
Agreement and, when issued and delivered by the Company pursuant to this
Agreement against payment of the consideration set forth herein, will be validly
issued, fully paid and non-assessable; the Common Stock conforms to all
statements relating thereto contained in the Prospectus and such description
conforms to the rights set forth in the instruments defining the same; no holder
of the Securities will be subject to personal liability solely by reason of
being such a holder; and the issuance of the Securities is not subject to the
preemptive or other similar rights of any securityholder of the Company.
(xi) Absence of Defaults and Conflicts. Neither the Company nor any of its
Subsidiaries is in violation of its charter or by-laws or in default in the
performance or observance of any obligation, agreement, covenant or condition
contained in any contract, indenture, mortgage, deed of trust, loan or credit
agreement, note, lease or other agreement or instrument to which the Company or
any of its Subsidiaries is a party or by which it or any of them may be bound,
or to which any of the property or assets of the Company or any Subsidiary is
subject (collectively, "Agreements and Instruments") except for such defaults
that would not result in a Material Adverse Effect; and the execution, delivery
and performance of this Agreement and the consummation of the transactions
contemplated herein and in the Registration Statement and the Prospectus
(including the issuance and sale of the Securities and the use of the proceeds
from the sale of the Securities as described in the Prospectus under the caption
"Use of Proceeds") and compliance by the Company with its obligations hereunder
have been duly
6
authorized by all necessary corporate action and do not and will not, whether
with or without the giving of notice or passage of time or both, conflict with
or constitute a breach of, or default or, except as set forth or contemplated in
the Prospectus, Repayment Event (as defined below) under, or result in the
creation or imposition of any lien, charge or encumbrance upon any property or
assets of the Company or any Subsidiary pursuant to, the Agreements and
Instruments (except for such conflicts, breaches or defaults or liens, charges
or encumbrances that would not result in a Material Adverse Effect), nor will
such action result in any violation of the provisions of the charter or by-laws
of the Company or any Subsidiary or any applicable law, statute, rule,
regulation, judgment, order, writ or decree of any government, government
instrumentality or court, domestic or foreign, having jurisdiction over the
Company or any Subsidiary or any of their assets, properties or operations. As
used herein, a "Repayment Event" means any event or condition which gives the
holder of any note, debenture or other evidence of indebtedness (or any person
acting on such holder's behalf) the right to require the repurchase, redemption
or repayment of all or a portion of such indebtedness by the Company or any
Subsidiary for which the holder has not agreed to waive or forego such right.
(xii) Absence of Labor Dispute. No labor dispute with the employees of the
Company or any Subsidiary exists or, to the knowledge of the Company, is
imminent, and the Company is not aware of any existing or imminent labor
disturbance by the employees of any of its or any Subsidiary's principal
suppliers, manufacturers, customers or contractors, which, in either case, may
reasonably be expected to result in a Material Adverse Effect.
(xiii) Absence of Proceedings. There is no action, suit, proceeding,
inquiry or investigation before or brought by any court or governmental agency
or body, domestic or foreign, now pending, or, to the knowledge of the Company,
threatened, against or affecting the Company or any Subsidiary, which is
required to be disclosed in the Registration Statement or the Prospectus (other
than as disclosed therein), or which might reasonably be expected to result in a
Material Adverse Effect, or which might reasonably be expected to materially and
adversely affect the properties or assets thereof or the consummation of the
transactions contemplated in this Agreement or the performance by the Company of
its obligations hereunder; the aggregate of all pending legal or governmental
proceedings to which the Company or any Subsidiary is a party or of which any of
their respective property or assets is the subject which are not described in
the Registration Statement and the Prospectus, including ordinary routine
litigation incidental to the business, could not reasonably be expected to
result in a Material Adverse Effect.
(xiv) Accuracy of Exhibits. There are no contracts or documents which are
required to be described in the Registration Statement, the Prospectus or the
documents incorporated by reference therein or to be filed as exhibits thereto
which have not been so described and filed as required.
(xv) Possession of Intellectual Property. The Company and its Subsidiaries
own or possess, or can acquire on reasonable terms, adequate patents, patent
rights, licenses, covenants not to xxx, inventions, copyrights, know-how
(including trade secrets and other unpatented and/or unpatentable proprietary or
confidential information, systems
7
or procedures), trademarks, service marks, trade names or other
intellectual property (collectively, "Intellectual Property") necessary to
carry on the business now operated by them, and neither the Company nor any
of its Subsidiaries has received any notice or is otherwise aware of any
infringement of or conflict with asserted rights of others with respect to
any Intellectual Property or of any facts or circumstances which would
reasonably be expected to render any Intellectual Property invalid or
inadequate to protect the interest of the Company or any of its
Subsidiaries therein, and which infringement or conflict or invalidity or
inadequacy, singly or in the aggregate, would reasonably be expected to
result in a Material Adverse Effect.
(xvi) Absence of Further Requirements. No filing with, or
authorization, approval, consent, license, order, registration,
qualification or decree of, any third party or any court or governmental
authority or agency is necessary or required for the performance by the
Company of its obligations hereunder, in connection with the offering,
issuance or sale of the Securities hereunder or the consummation of the
transactions contemplated by this Agreement, except such as have been
obtained by the Company, and except for applicable state securities or blue
sky laws and requirements of the National Association of Securities
Dealers, Inc.
(xvii) Possession of Licenses and Permits. The Company and its
Subsidiaries possess such permits, licenses, approvals, consents and other
authorizations (collectively, "Governmental Licenses") issued by the
appropriate federal, state, local or foreign regulatory agencies or bodies
necessary to conduct the business now operated by them, except where the
failure to possess such Governmental Licenses, could not reasonably be
expected to have a Material Adverse Effect; the Company and its
Subsidiaries are in compliance with the terms and conditions of all such
Governmental Licenses, except where the failure so to comply would not,
singly or in the aggregate, have a Material Adverse Effect; all of the
Governmental Licenses are valid and in full force and effect, except when
the invalidity of such Governmental Licenses or the failure of such
Governmental Licenses to be in full force and effect would not have a
Material Adverse Effect; and neither the Company nor any of its
Subsidiaries has received any notice of proceedings relating to the
revocation or modification of any such Governmental Licenses which, singly
or in the aggregate, if the subject of an unfavorable decision, ruling or
finding, would result in a Material Adverse Effect.
(xviii) Title to Property. The Company and its Subsidiaries have good
and marketable title to all real property owned by the Company and its
Subsidiaries and good title to all other properties owned by them, in each
case, free and clear of all mortgages, pledges, liens, security interests,
claims, restrictions or encumbrances of any kind except such as (a) are
described in the Registration Statement and the Prospectus, (b) secure debt
instruments and/or credit facilities reflected in the financial statements
included in the Registration Statement or Prospectus, (c) are restricted
deposits not exceeding $5,100,000 in the aggregate securing letters of
credit obtained by the Company and its Subsidiaries in the ordinary course
of business or (d) do not, singly or in the aggregate, have a Material
Adverse Effect and do not interfere with the use made and proposed to be
made of such property by the Company or any of its Subsidiaries; except as
otherwise disclosed in the Registration Statement, all of the leases and
subleases material to the business of the
8
Company and its Subsidiaries, considered as one enterprise, and under which
the Company or any of its Subsidiaries holds properties described in the
Prospectus, are in full force and effect, and neither the Company nor any
Subsidiary has any notice of any material claim of any sort that has been
asserted by anyone adverse to the rights of the Company or any Subsidiary
under any of the leases or subleases mentioned above, or affecting or
questioning the rights of the Company or such Subsidiary to the continued
possession of the leased or subleased premises under any such lease or
sublease.
(xix) Investment Company Act. The Company is not, and upon the
issuance and sale of the Securities as herein contemplated and the
application of the net proceeds therefrom as described in the Prospectus
will not be, an "investment company" or an entity "controlled" by an
"investment company" as such terms are defined in the Investment Company
Act of 1940, as amended (the "1940 Act").
(xx) Environmental Laws. Except as described in the Registration
Statement and except as would not, singly or in the aggregate, result in a
Material Adverse Effect, (A) neither the Company nor any of its
Subsidiaries is in violation of any federal, state, local or foreign
statute, law, rule, regulation, ordinance, code, policy or rule of common
law or any judicial or administrative interpretation thereof, including any
judicial or administrative order, consent, decree or judgment, relating to
pollution or protection of human health, the environment (including,
without limitation, ambient air, surface water, groundwater, land surface
or subsurface strata) or wildlife, including, without limitation, laws and
regulations relating to the release or threatened release of chemicals,
pollutants, contaminants, wastes, toxic substances, hazardous substances,
petroleum or petroleum products (collectively, "Hazardous Materials") or to
the manufacture, processing, distribution, use, treatment, storage,
disposal, transport or handling of Hazardous Materials (collectively,
"Environmental Laws"), (B) the Company and its Subsidiaries have all
permits, authorizations and approvals required under any applicable
Environmental Laws and are each in compliance with their requirements, (C)
there are no pending or, to the knowledge of the Company, threatened
administrative, regulatory or judicial actions, suits, demands, demand
letters, claims, liens, notices of noncompliance or violation,
investigation or proceedings relating to any Environmental Law against the
Company or any of its Subsidiaries and (D) to the knowledge of the Company,
there are no events or circumstances that might reasonably be expected to
form the basis of an order for clean-up or remediation, or an action, suit
or proceeding by any private party or governmental body or agency, against
or affecting the Company or any of its Subsidiaries relating to Hazardous
Materials or any Environmental Laws.
(xxi) Statistical Data. The statistical and market-related data
included in the Prospectus and the Registration Statement are based on or
derived from sources which the Company believes to be reliable and
accurate.
(xxii) No Brokers' Fees. Except as described in the Prospectus, there
are no contracts, agreements or understandings between the Company and any
person that would give rise to a valid claim against the Company or any
Underwriter for a brokerage commission, finder's fee or other like payment
in connection with this offering.
9
(xxiii) Registration Rights. Except as described in the Prospectus,
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 1933 Act with respect to any
securities of the Company owned or to be owned by such person or to require
the Company to include such securities in the securities registered
pursuant to a Registration Statement or in any securities being registered
pursuant to any other registration statement filed by the Company under the
1933 Act. Except as disclosed in the Prospectus and except with respect to
the registration rights exercised by the Selling Stockholder hereunder, all
persons (A) to whom the Company has granted such demand or piggyback
registration rights and (B) whose rights may be exercised in connection
with the registration and offering of the Securities have waived such
registration rights.
(xxiv) Related Party Transactions. No relationship, direct or
indirect, exists between or among the Company on the one hand, and the
directors, officers, stockholders, customers or suppliers of the Company on
the other hand, which is required to be described in the Prospectus which
is not so described.
(xxv) ERISA. Except as would not reasonably be expected to have a
Material Adverse Effect, the Company and its Subsidiaries are in compliance
in all material respects with all presently applicable provisions of the
Employee Retirement Income Security Act of 1974, as amended, including the
regulations and published interpretations thereunder ("ERISA"); no
"reportable event" (as defined in ERISA) has occurred with respect to any
"pension plan" (as defined in ERISA) for which the Company or any
Subsidiary of the Company would have any liability; neither the Company nor
any of its Subsidiaries has incurred nor does the Company or any of its
Subsidiaries expect to incur liability under (A) Title IV of ERISA with
respect to the termination of, or withdrawal from, any "pension plan" or
(B) Sections 412 or 4971 of the Internal Revenue Code of 1986, as amended,
including the regulations and published interpretations thereunder (the
"Code"); and each "pension plan" for which the Company or any Subsidiary of
the Company would have any liability that is intended to be qualified under
Section 401(a) of the Code is so qualified in all material respects and
nothing has occurred, whether by action or by failure to act, which would
cause the loss of such qualification.
(xxvi) Tax Returns. The Company has filed all federal, state and local
income and franchise tax returns required to be filed through the date
hereof and has paid all taxes due thereon, and no tax deficiency has been
determined adversely to the Company or any of its Subsidiaries which has
had (nor does the Company have any knowledge of any tax deficiency which,
if determined adversely to the Company or any of its Subsidiaries, could
reasonably be expected to have) a Material Adverse Effect.
(xxvii) Disclosure Controls and Procedures. The Company has
established and maintains disclosure controls and procedures (as such term
is defined in Rule 13a-14 under the Exchange Act), which (A) are designed
to ensure that material information relating to the Company, including its
consolidated Subsidiaries, is made known to the Company's principal
executive officer and its principal financial officer by others within
those entities, particularly during the periods in which the periodic
reports required under
10
the 1934 Act are being prepared; (B) have been evaluated for effectiveness
as of a date within 90 days prior to the filing of the Company's most
recent annual or quarterly report filed with the Commission; and (C) are
effective in all material respects to perform the functions for which they
were established.
(xxviii) Evaluation of Disclosure Controls and Procedures. Based on
the evaluation of its disclosure controls and procedures, the Company is
not aware of (A) any significant deficiency in the design or operation of
internal controls which could adversely affect the Company's ability to
record, process, summarize and report financial data or any material
weaknesses in internal controls; or (B) any fraud, whether or not material,
that involves management or other employees who have a significant role in
the Company's internal controls.
(xxix) Absence of Significant Changes in Internal Controls. Since the
date of the most recent evaluation of such disclosure controls and
procedures, there have been no significant changes in internal controls or
in other factors that could significantly affect internal controls,
including any corrective actions with regard to significant deficiencies
and material weaknesses.
(b) Representations and Warranties by the Selling Stockholder. The Selling
Stockholder represents and warrants to each Underwriter as of the date hereof,
as of the Closing Time, and, if the Selling Stockholder is selling Option
Securities on a Date of Delivery, as of each such Date of Delivery, and agrees
with each Underwriter, as follows:
(i) Accurate Disclosure. The Selling Stockholder has reviewed the
Prospectus, and to the knowledge of the Selling Stockholder, neither the
Prospectus nor any amendments or supplements thereto, at the time the
Prospectus or any such amendment or supplement was issued and at the
Closing Time (and, if any Option Securities are purchased, at the Date of
Delivery), included or will include as of such times an untrue statement of
a material fact or omitted or will omit to state a material fact necessary
in order to make the statements therein, in the light of the circumstances
under which they were made, not misleading. The representations and
warranties in this subsection shall not apply to statements in or omissions
from the Prospectus made in reliance upon and in conformity with
information furnished to the Company in writing by any Underwriter through
Xxxxxx Brothers or Xxxxxxx Xxxxx expressly for use in the Prospectus.
(ii) Authorization of Agreements. The Selling Stockholder has the full
right, limited liability company power and authority to enter into this
Agreement and to sell, transfer and deliver the Securities to be sold by
the Selling Stockholder hereunder. The execution and delivery of this
Agreement and the sale and delivery of the Securities to be sold by the
Selling Stockholder and the consummation of the transactions contemplated
herein and compliance by the Selling Stockholder with its obligations
hereunder have been duly authorized by the Selling Stockholder and do not
and will not, conflict with or result in a breach or violation of any of
the terms or provisions of, or constitute a default under, any material
indenture, mortgage, deed of trust, loan agreement or other agreement
11
or instrument to which any of the property or assets of the Selling
Stockholder is subject, nor will such action result in any violation of the
provisions of the organizational documents of the Selling Stockholder, or
any applicable treaty, law, statute, rule, regulation, judgment, order,
writ or decree of any government, government instrumentality or court,
domestic or foreign, having jurisdiction over the Selling Stockholder or
any of its properties.
(iii) Good and Valid Title. The Selling Stockholder has and will at
the Closing Time and, if any Option Securities are purchased, on the Date
of Delivery have good and valid title to the Securities to be sold by the
Selling Stockholder hereunder, free and clear of any security interest,
mortgage, pledge, lien, charge, claim, equity or encumbrance of any kind,
other than pursuant to this Agreement; and upon delivery of such Securities
and payment of the purchase price therefor as herein contemplated, assuming
each such Underwriter has no notice of any adverse claim (within the
meaning of Section 8-105 of the Uniform Commercial Code as in effect in the
State of New York), each of the Underwriters will receive good and valid
title to the Securities purchased by it from the Selling Stockholder, free
and clear of any security interest, mortgage, pledge, lien, charge, claim,
equity or encumbrance of any kind.
(iv) Absence of Manipulation. The Selling Stockholder has not taken,
and will not take, directly or indirectly, any action which is designed to
or which has constituted or which might reasonably be expected to cause or
result in stabilization or manipulation of the price of any security of the
Company to facilitate the sale or resale of the Securities.
(v) Absence of Further Requirements. Except for the registration of
the Securities under the 1933 Act and such consents, approvals,
authorizations, registrations, filings or qualifications as may be required
under the 1934 Act and applicable state securities laws in connection with
the purchase and distribution of the Securities by the Underwriters, no
filing with, or consent, approval, authorization, order, registration,
qualification or decree of, any court or governmental authority or agency,
domestic or foreign, is necessary or required for the performance by the
Selling Stockholder of its obligations hereunder or in connection with the
sale and delivery of the Securities hereunder or the consummation of the
transactions contemplated by this Agreement.
(vi) Restriction on Sale of Securities. During a period of 90 days
from the date of the Prospectus, the Selling Stockholder will not, without
the prior written consent of Xxxxxx Brothers and Xxxxxxx Xxxxx, (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 share of Common Stock or any securities convertible into or exercisable
or exchangeable for Common Stock or file any registration statement under
the 1933 Act with respect to any of the foregoing or (ii) enter into any
swap or any other agreement or any transaction that transfers, in whole or
in part, directly or indirectly, the economic consequence of ownership of
the Common Stock, whether any such swap or transaction described in clause
(i) or (ii) above is to be settled by delivery of Common Stock or such
other
12
securities, in cash or otherwise. The foregoing sentence shall not apply to
the Securities to be sold hereunder.
(c) Officer's Certificates. Any certificate signed by any officer of the
Company or any of its Subsidiaries delivered to the Representatives or to
counsel for the Underwriters shall be deemed a representation and warranty by
the Company to each Underwriter as to the matters covered thereby; and any
certificate signed by or on behalf of the Selling Stockholder as such and
delivered to the Representatives or to counsel for the Underwriters pursuant to
the terms of this Agreement shall be deemed a representation and warranty by the
Selling Stockholder to the Underwriters as to the matters covered thereby.
SECTION 2. Sale and Delivery to Underwriters; Closing.
-------------------------------------------
(a) Initial Securities. On the basis of the representations and warranties
herein contained and subject to the terms and conditions herein set forth, the
Company and the Selling Stockholder, severally and not jointly, agree to sell to
each Underwriter, severally and not jointly, and each Underwriter, severally and
not jointly, agrees to purchase from the Company and the Selling Stockholder, at
the price per share set forth in Schedule 3, that proportion of the number of
Initial Securities set forth in Schedule 2 opposite the name of the Company or
the Selling Stockholder, as the case may be, which the number of Initial
Securities set forth in Schedule 1 opposite the name of such Underwriter, plus
any additional number of Initial Securities which such Underwriter may become
obligated to purchase pursuant to the provisions of Section 10 hereof, bears to
the total number of Initial Securities, subject, in each case, to such
adjustments among the Underwriters as the Representatives in their sole
discretion shall make to eliminate any sales or purchases of fractional
securities.
(b) Option Securities.
In addition, on the basis of the representations and warranties herein
contained and subject to the terms and conditions herein set forth, the Selling
Stockholder hereby grants an option to the Underwriters, severally and not
jointly, to purchase up to an additional 3,300,000 shares of Common Stock at the
price per share set forth in Schedule 3, less an amount per share equal to any
dividends or distributions declared by the Company and payable on the Initial
Securities but not payable on the Option Securities. The option hereby granted
will expire 30 days after the date hereof and may be exercised in whole or in
part from time to time only for the purpose of covering over-allotments which
may be made in connection with the offering and distribution of the Initial
Securities upon written notice by the Representatives to the Company and the
Selling Stockholder setting forth the number of Option Securities as to which
the several Underwriters are then exercising the option and the time and date of
payment and delivery for such Option Securities. Any such time and date of
delivery (a "Date of Delivery") shall be determined by the Representatives, but
shall not be later than seven full business days after the exercise of said
option, nor in any event prior to the Closing Time, as hereinafter defined. If
the option is exercised as to all or any portion of the Option Securities, each
of the Underwriters, acting severally and not jointly, will purchase that
proportion of the total number of Option Securities then being purchased which
the number of Initial Securities set forth in Schedule 1 opposite the name of
such Underwriter bears to the total number of Initial Securities, subject in
13
each case to such adjustments as the Representatives in their discretion shall
make to eliminate any sales or purchases of fractional shares.
(c) Payment. Payment of the purchase price for, and delivery of
certificates for, the Initial Securities shall be made at the offices of Xxxxxx
& Xxxxxxx Illinois LLC, 000 X. Xxxxxx Xxxxx, Xxxxx 0000, Xxxxxxx, XX 00000, or
at such other place as shall be agreed upon by the Representatives and the
Company and the Selling Stockholder, at 10:00 A.M. (Eastern time) on the third
(fourth, if the pricing occurs after 4:30 P.M. (Eastern time) on any given day)
business day after the date hereof (unless postponed in accordance with the
provisions of Section 10), or such other time not later than ten business days
after such date as shall be agreed upon by the Representatives and the Company
and the Selling Stockholder (such time and date of payment and delivery being
herein called "Closing Time").
In addition, in the event that any or all of the Option Securities are
purchased by the Underwriters, payment of the purchase price for, and delivery
of certificates for, such Option Securities shall be made at the above-mentioned
offices, or at such other place as shall be agreed upon by the Representatives
and the Company and the Selling Stockholder, on each Date of Delivery as
specified in the notice from the Representatives to the Company and the Selling
Stockholder.
Payment shall be made to the Company and the Selling Stockholder by wire
transfer of immediately available funds to bank accounts designated by the
Company and the Selling Stockholder against delivery through the facilities of
The Depository Trust Company to the Representatives for the respective accounts
of the Underwriters of certificates for the Securities to be purchased by them.
It is understood that each Underwriter has authorized the Representatives, for
its account, to accept delivery of, receipt for, and make payment of the
purchase price for, the Initial Securities and the Option Securities, if any,
which it has agreed to purchase. Xxxxxx Brothers or Xxxxxxx Xxxxx, individually
and not as representative of the Underwriters, may (but shall not be obligated
to) make payment of the purchase price for the Initial Securities or the Option
Securities, if any, to be purchased by any Underwriter whose funds have not been
received by the Closing Time or the relevant Date of Delivery, as the case may
be, but such payment shall not relieve such Underwriter from its obligations
hereunder.
(d) Denominations; Registration. Certificates for the Initial Securities
and the Option Securities, if any, shall be in such denominations and registered
in such names as the Representatives may request in writing at least two full
business days before the Closing Time or the relevant Date of Delivery, as the
case may be. The certificates for the Initial Securities and the Option
Securities, if any, will be made available for examination and packaging by the
Representatives in The City of New York not later than 10:00 A.M. (Eastern time)
on the business day prior to the Closing Time or the relevant Date of Delivery,
as the case may be.
SECTION 3. Covenants of the Company. The Company covenants with each Underwriter
as follows:
(a) Compliance with Securities Regulations and Commission Requests. The
Company, subject to Section 3(b), will comply with the requirements of Rules 415
and 424 of the 1933 Act Regulations and will notify the Representatives
immediately, and confirm the
14
notice in writing, (i) when any post-effective amendment to the Registration
Statement shall become effective, or any supplement to the Prospectus or any
amended Prospectus shall have been filed, (ii) of the receipt of any comments
from the Commission, (iii) of any request by the Commission for any amendment to
the Registration Statement or any amendment or supplement to the Prospectus or
for additional information, and (iv) of the issuance by the Commission of any
stop order suspending the effectiveness of the Registration Statement or of any
order preventing or suspending the use of any preliminary prospectus, or of the
suspension of the qualification of the Securities for offering or sale in any
jurisdiction, or of the initiation or threatening of any proceedings for any of
such purposes. The Company will promptly effect the filings necessary pursuant
to Rule 424(b) and will take such steps as it deems necessary to ascertain
promptly whether the form of prospectus transmitted for filing under Rule 424(b)
was received for filing by the Commission and, in the event that it was not, it
will promptly file such prospectus. The Company will make every reasonable
effort to prevent the issuance of any stop order and, if any stop order is
issued, to obtain the lifting thereof at the earliest possible moment.
(b) Filing of Amendments. During the period in which a Prospectus is
required by the 1933 Act to be delivered in connection with the sale of the
Securities (the "Prospectus Delivery Period"), the Company will give the
Representatives notice of its intention to file or prepare any amendment to the
Registration Statement, or any amendment, supplement or revision to either the
prospectus included in the Registration Statement at the time it became
effective or to the Prospectus, whether pursuant to the 1933 Act, the 1934 Act
or otherwise, will furnish the Representatives with copies of any such documents
a reasonable amount of time prior to such proposed filing or use, as the case
may be, and will not file or use any such document to which the Representatives
or counsel for the Underwriters shall reasonably object.
(c) Delivery of Registration Statements. The Company has furnished or will
deliver to the Representatives and counsel for the Underwriters, without charge,
signed copies of the Registration Statement as originally filed and of each
amendment thereto (including exhibits filed therewith or incorporated by
reference therein and documents incorporated or deemed to be incorporated by
reference therein) and signed copies of all consents and certificates of
experts, and will also deliver to the Representatives, without charge, a
conformed copy of the Registration Statement as originally filed and of each
amendment thereto (without exhibits) for each of the Underwriters. The copies of
the Registration Statement and each amendment thereto furnished to the
Underwriters will be identical to the electronically transmitted copies thereof
filed with the Commission pursuant to XXXXX, except to the extent permitted by
Regulation S-T.
(d) Delivery of Prospectuses. The Company has delivered to each
Underwriter, without charge, as many copies of each preliminary prospectus as
such Underwriter reasonably requested, and the Company hereby consents to the
use of such copies for purposes permitted by the 1933 Act. The Company will
furnish to each Underwriter, without charge, during the Prospectus Delivery
Period, such number of copies of the Prospectus (as amended or supplemented) as
such Underwriter may reasonably request. The Prospectus and any amendments or
supplements thereto furnished to the Underwriters will be identical to the
electronically transmitted copies thereof filed with the Commission pursuant to
XXXXX, except to the extent permitted by Regulation S-T.
15
(e) Continued Compliance with Securities Laws. The Company will comply with
the 1933 Act and the 1933 Act Regulations and the 1934 Act and the 1934 Act
Regulations so as to permit the completion of the distribution of the Securities
as contemplated in this Agreement and in the Prospectus. If at any time during
the Prospectus Delivery Period, any event shall occur or condition shall exist
as a result of which it is necessary, in the reasonable opinion of counsel for
the Underwriters or for the Company, to amend the Registration Statement or
amend or supplement the Prospectus in order that the Prospectus will not include
any untrue statements of a material fact or omit to state a material fact
necessary in order to make the statements therein not misleading in the light of
the circumstances existing at the time it is delivered to a purchaser, or if it
shall be necessary, in the reasonable opinion of such counsel, at any such time
to amend the Registration Statement or amend or supplement the Prospectus in
order to comply with the requirements of the 1933 Act or the 1933 Act
Regulations, the Company will promptly prepare and file with the Commission,
subject to Section 3(b), such amendment or supplement as may be necessary to
correct such statement or omission or to make the Registration Statement or the
Prospectus comply with such requirements, and the Company will furnish to the
Underwriters such number of copies of such amendment or supplement as the
Underwriters may reasonably request.
(f) Blue Sky Qualifications. The Company will use commercially reasonable
efforts, in cooperation with the Underwriters, to qualify the Securities for
offering and sale under the applicable securities laws of such states and other
jurisdictions (domestic or foreign) as the Representatives may designate and to
maintain such qualifications in effect for a period of not less than one year
from the later of the effective date of the Registration Statement and any Rule
462(b) Registration Statement; provided, however, that the Company shall not be
obligated to file any general consent to service of process or to qualify as a
foreign corporation or as a dealer in securities in any jurisdiction in which it
is not so qualified or to subject itself to taxation in respect of doing
business in any jurisdiction in which it is not otherwise so subject. In each
jurisdiction in which the Securities have been so qualified, the Company will
file such statements and reports as may be required by the laws of such
jurisdiction to continue such qualification in effect for a period of not less
than one year from the effective date of the Registration Statement and any Rule
462(b) Registration Statement.
(g) Rule 158. The Company will timely file such reports pursuant to the
1934 Act as are necessary in order to make generally available to its
securityholders as soon as practicable an earnings statement for the purposes
of, and to provide the benefits contemplated by, the last paragraph of Section
11(a) of the 1933 Act.
(h) Use of Proceeds. The Company will use the net proceeds received by it
from the sale of the Securities in the manner specified in the Prospectus under
"Use of Proceeds".
(i) Listing. The Company will use its best efforts to effect the listing of
the Securities on the New York Stock Exchange and will file with the New York
Stock Exchange all documents and notices required by the New York Stock Exchange
of companies that have Securities that are traded in the over-the-counter market
and quotations for which are reported by the New York Stock Exchange.
16
(j) Restriction on Sale of Securities. During a period of 90 days from the
date of the Prospectus, the Company will not, without the prior written consent
of Xxxxxx Brothers and Xxxxxxx Xxxxx, (i) directly or indirectly, 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 any share of Common Stock or any securities
convertible into or exercisable or exchangeable for Common Stock or file any
registration statement under the 1933 Act with respect to any of the foregoing
or (ii) enter into any swap or any other agreement or any transaction that
transfers, in whole or in part, directly or indirectly, the economic consequence
of ownership of the Common Stock, whether any such swap or transaction described
in clause (i) or (ii) above is to be settled by delivery of Common Stock or such
other securities, in cash or otherwise. The foregoing sentence shall not apply
to (A) the Securities to be sold hereunder, (B) any shares of Common Stock
issued by the Company upon the exercise of an option or warrant or the
conversion of a security outstanding on the date hereof and referred to in the
Prospectus or (C) any shares of Common Stock issued or options to purchase
Common Stock granted pursuant to existing employee benefit plans of the Company
referred to in the Prospectus.
(k) Reporting Requirements. The Company, during the Prospectus Delivery
Period, will file all documents required to be filed with the Commission
pursuant to the 1934 Act within the time periods required by the 1934 Act and
the 1934 Act Regulations.
SECTION 4. Payment of Expenses.
--------------------
(a) Expenses. The Company will pay all expenses incident to the performance
of its obligations under this Agreement, including (i) the preparation, printing
and filing of the Registration Statement (including financial statements and
exhibits) as originally filed and of each amendment thereto, (ii) the costs of
distributing the Registration Statement as originally filed and each amendment
thereto and any post-effective amendments thereof (including, in each case,
exhibits), any preliminary prospectus, the Prospectus and any amendment or
supplement to the Prospectus or any document incorporated by reference therein,
all as provided in this Agreement, (iii) the preparation, printing and delivery
to the Underwriters of this Agreement, any Agreement among Underwriters and such
other documents as may be required in connection with the offering, purchase,
sale, issuance or delivery of the Securities, (iv) the preparation, issuance and
delivery of the certificates for the Securities to the Underwriters, including
any stock or other transfer taxes and any stamp or other duties payable upon the
sale, issuance or delivery of the Securities to the Underwriters, (v) the fees
and disbursements of the Company's counsel, the Selling Stockholder's counsel,
accountants and other advisors, (vi) the qualification of the Securities under
securities laws in accordance with the provisions of Section 3(f) hereof,
including filing fees and the reasonable fees and disbursements of counsel for
the Underwriters in connection therewith and in connection with the preparation
of the Blue Sky Survey and any supplement thereto, (vii) the printing and
delivery to the Underwriters of copies of each preliminary prospectus and of the
Prospectus and any amendments or supplements thereto, (viii) the preparation,
printing and delivery to the Underwriters of copies of the Blue Sky Survey and
any supplement thereto, (ix) the fees and expenses of any transfer agent or
registrar for the Securities and (x) the filing fees incident to, and the
reasonable fees and disbursements of counsel to the Underwriters in connection
with, the review by the National Association of Securities Dealers, Inc. (the
"NASD") of the terms of the sale of the Securities, if applicable, and
17
(xi) the fees and expenses incurred in connection with the listing of the
Securities on the New York Stock Exchange.
(b) Expenses of the Selling Stockholder. The Selling Stockholder will pay
all expenses relating to any stamp duties, capital duties and stock transfer
taxes, if any, payable upon the sale of the Securities to the Underwriters, and
their transfer between the Underwriters pursuant to an agreement between such
Underwriters.
(c) Termination of Agreement. If this Agreement is terminated by the
Representatives in accordance with the provisions of Section 5(u) or Section
9(a)(i) hereof, the Company shall reimburse the Underwriters for all of their
reasonable out-of-pocket expenses, including the reasonable fees and
disbursements of counsel for the Underwriters, incurred in connection with the
transactions contemplated by this Agreement.
(d) Allocation of Expenses. The provisions of this Section shall not affect
any agreement that the Company and the Selling Stockholder may have or make for
the sharing of such costs and expenses, including without limitation, Section
2.8 of the Registration Rights Agreement dated as of November 13, 2001 among the
Company, the Selling Stockholder and certain guarantors specified therein, as
subsequently amended.
SECTION 5. Conditions of Underwriters' Obligations. The obligations of the
several Underwriters hereunder are subject to the accuracy of the
representations and warranties of the Company and the Selling Stockholder
contained in Section 1 hereof or in certificates of any officer of the Company
or any Subsidiary of the Company or on behalf of the Selling Stockholder
delivered pursuant to the provisions hereof, to the performance by the Company
of its covenants and other obligations hereunder and the performance by the
Selling Stockholder of its covenants and other obligations hereunder, and to the
following further conditions:
(a) Effectiveness of Registration Statement. The Registration Statement,
including any Rule 462(b) Registration Statement, has become effective and at
Closing Time no stop order suspending the effectiveness of the Registration
Statement shall have been issued under the 1933 Act or proceedings therefor
initiated or threatened by the Commission, and any request on the part of the
Commission for additional information shall have been complied with to the
reasonable satisfaction of counsel to the Underwriters. A Prospectus Supplement
containing information relating to the description of the Securities, the
specific method of distribution and similar matters shall have been filed with
the Commission in accordance with Rule 424(b)(1), (2), (3), (4) or (5), as
applicable.
(b) No Material Misstatement or Omission. No Underwriter shall have
discovered and disclosed to the Company on or prior to the Closing Time or the
relevant Date of Delivery, as the case may be, that the Registration Statement
or the Prospectus or any amendment or supplement thereto contains an untrue
statement of a fact, which in the opinion of Xxxxxx & Xxxxxxx Illinois LLC,
counsel for the Underwriters, is material or omits to state a fact which, in the
opinion of such counsel, is material and is required to be stated therein or is
necessary to make the statements therein not misleading.
18
(c) Corporate Proceedings. All corporate proceedings and other legal
matters incident to the authorization, form and validity of this Agreement, the
Securities, the Registration Statement and the Prospectus, and all other legal
matters relating to this Agreement and the transactions contemplated hereby
shall be reasonably satisfactory in all material respects to counsel for the
Underwriters, and the Company and the Selling Stockholder shall have furnished
to such counsel all documents and information that they may reasonably request
to enable them to pass upon such matters.
(d) Opinion of Counsel for Company. At Closing Time, the Representatives
shall have received the favorable opinion, dated as of Closing Time, of Xxxxx
Xxxx LLP, counsel for the Company, together with signed or reproduced copies of
such letter for each of the other Underwriters to the effect set forth in
Exhibit A hereto.
(e) Opinion of Senniger, Powers, Xxxxxxx & Xxxxxx. At Closing Time, the
Representatives shall have received the favorable opinion, dated as of Closing
Time, of Senniger, Powers, Xxxxxxx & Xxxxxx, special counsel for the Company, in
form and substance satisfactory to counsel for the Underwriters, together with
signed or reproduced copies of such letter for each of the other Underwriters to
the effect set forth in Exhibit B hereto.
(f) Opinion of Abe, Ikubo & Katayama. At Closing Time, the Representatives
shall have received the favorable opinion, dated as of Closing Time, of Abe,
Ikubo & Katayama, special counsel for the Company, in form and substance
satisfactory to counsel for the Underwriters, together with signed or reproduced
copies of such letter for each of the other Underwriters to the effect set forth
in Exhibit C hereto.
(g) Opinion of Hwang Mok Park P.C At Closing Time, the Representatives
shall have received the favorable opinion, dated as of Closing Time, of Hwang
Mok Park P.C., special counsel for the Company, in form and substance
satisfactory to counsel for the Underwriters, together with signed or reproduced
copies of such letter for each of the other Underwriters to the effect set forth
in Exhibit D hereto.
(h) Opinion of Studio Legale Tosato. At Closing Time, the Representatives
shall have received the favorable opinion, dated as of Closing Time, of Studio
Legale Tosato, special counsel for the Company, in form and substance
satisfactory to counsel for the Underwriters, together with signed or reproduced
copies of such letter for each of the other Underwriters to the effect set forth
in Exhibit E hereto.
(i) Opinion of Counsel for the Selling Stockholder. At Closing Time, the
Representatives shall have received the favorable opinion, dated as of Closing
Time, of Cleary, Gottlieb, Xxxxx and Xxxxxxxx, counsel for the Selling
Stockholder, together with signed or reproduced copies of such letter for each
of the other Underwriters to the effect set forth in Exhibit F hereto.
(j) Opinion of Counsel for Underwriters. At Closing Time, the
Representatives shall have received the favorable opinion, dated as of Closing
Time, of Xxxxxx & Xxxxxxx Illinois LLC, counsel for the Underwriters, together
with signed or reproduced copies of such letter for each of the other
Underwriters with respect to the matters set forth in clauses (i), (v), (vi)
(solely
19
as to preemptive or other similar rights arising by operation of law or under
the charter or by-laws of the Company), (viii) through (x), inclusive, (xiv)
(solely as to the information in the Prospectus under "Description of Capital
Stock--Common Stock") and the penultimate paragraph of Exhibit A hereto. In
giving such opinion such counsel may rely, as to all matters governed by the
laws of jurisdictions other than the law of the State of New York, the federal
law of the United States and the General Corporation Law of the State of
Delaware, upon the opinions of counsel satisfactory to the Representatives. Such
counsel may also state that, insofar as such opinion involves factual matters,
they have relied, to the extent they deem proper, upon certificates of officers
of the Company and its Subsidiaries and certificates of public officials.
(k) Officers' Certificate. At Closing Time, there shall not have been,
since the date hereof or since the respective dates as of which information is
given in the Prospectus, any material adverse change in the condition, financial
or otherwise, or in the earnings, business affairs or business prospects of the
Company and its Subsidiaries considered as one enterprise, whether or not
arising in the ordinary course of business, and the Representatives shall have
received a certificate of the President or a Vice President of the Company and
of the chief financial or chief accounting officer of the Company, dated as of
Closing Time, to the effect that (i) there has been no such material adverse
change, (ii) the representations and warranties in Section 1(a) hereof are true
and correct with the same force and effect as though expressly made at and as of
Closing Time, (iii) the Company has complied with all agreements and satisfied
all conditions on its part to be performed or satisfied at or prior to Closing
Time, and (iv) no stop order suspending the effectiveness of the Registration
Statement has been issued and no proceedings for that purpose have been
instituted or are pending or are contemplated by the Commission.
(l) Certificate of Selling Stockholder. At Closing Time, the
Representatives shall have received a certificate of an Attorney-in-Fact on
behalf of the Selling Stockholder, dated as of Closing Time, to the effect that
(i) the representations and warranties of the Selling Stockholder contained in
Section 1(b) hereof are true and correct in all material respects with the same
force and effect as though expressly made at and as of Closing Time and (ii) the
Selling Stockholder has complied in all material respects with all agreements to
be performed under this Agreement, including its obligations to fulfill its
conditions set forth in Section 5 hereof, at or prior to Closing Time.
(m) Accountant's Comfort Letter. The Representatives shall have received
from KPMG LLP a letter dated as of the date hereof, in form and substance
previously agreed to by the Representatives, together with signed or reproduced
copies of such letter for each of the other Underwriters containing statements
and information 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.
(n) Bring-down Comfort Letter. At Closing Time, the Representatives shall
have received from KPMG LLP a letter, dated as of Closing Time, to the effect
that they reaffirm the statements made in the letter furnished pursuant to
subsection (m) of this Section, except that the specified date referred to shall
be a date not more than three business days prior to Closing Time.
20
(o) Approval of Listing. At Closing Time, the Securities shall have been
approved for listing on the New York Stock Exchange, subject only to official
notice of issuance.
(p) No Objection. The NASD has confirmed that it has not raised any
objection with respect to the fairness and reasonableness of the underwriting
terms and arrangements.
(q) Lock-up Agreements. At the date of this Agreement, the Representatives
shall have received an agreement substantially in the form of Exhibit G hereto
signed by the persons listed on Schedule 5 hereto.
(r) Conditions to Purchase of Option Securities. In the event that the
Underwriters exercise their option provided in Section 2(b) hereof to purchase
all or any portion of the Option Securities, the representations and warranties
of the Company and the Selling Stockholder contained herein and the statements
in any certificates furnished by the Company or any Subsidiary of the Company
and the Selling Stockholder hereunder shall be true and correct as of each Date
of Delivery and, at the relevant Date of Delivery, the Representatives shall
have received:
(i) Officers' Certificate. A certificate, dated such Date of Delivery,
of the President or a Vice President of the Company and of the chief financial
or chief accounting officer of the Company confirming that the certificate
delivered at the Closing Time pursuant to Section 5(k) hereof remains true and
correct as of such Date of Delivery.
(ii) Certificate of Selling Stockholder. A certificate, dated such
Date of Delivery, of an Attorney-in-Fact on behalf of the Selling Stockholder
confirming that the certificate delivered at Closing Time pursuant to Section
5(l) remains true and correct as of such Date of Delivery.
(iii) Opinion of Counsel for Company. The favorable opinion of Xxxxx
Xxxx LLP, counsel for the Company, dated such Date of Delivery, relating to the
Option Securities to be purchased on such Date of Delivery and otherwise to the
same effect as the opinion required by Section 5(d) hereof.
(iv) Opinion of Senniger, Powers, Xxxxxxx & Xxxxxx. The favorable
opinion of Senniger, Powers, Xxxxxxx & Xxxxxx, counsel for the Company, in form
and substance satisfactory to counsel for the Underwriters, dated such Date of
Delivery, relating to the Option Securities to be purchased on such Date of
Delivery and otherwise to the same effect as the opinion required by Section
5(e) hereof.
(v) Opinion of Abe, Ikubo & Katayama. The favorable opinion of Abe,
Ikubo & Katayama, counsel for the Company, in form and substance satisfactory to
counsel for the Underwriters, dated such Date of Delivery, relating to the
Option Securities to be purchased on such Date of Delivery and otherwise to the
same effect as the opinion required by Section 5(f) hereof.
(vi) Opinion of Hwang Mok Park P.C. The favorable opinion of Hwang Mok
Park P.C., counsel for the Company, in form and substance satisfactory to
counsel
21
for the Underwriters, dated such Date of Delivery, relating to the Option
Securities to be purchased on such Date of Delivery and otherwise to the same
effect as the opinion required by Section 5(g) hereof.
(vii) Opinion of Studio Legale Tosato. The favorable opinion of Studio
Legale Tosato, counsel for the Company, in form and substance satisfactory to
counsel for the Underwriters, dated such Date of Delivery, relating to the
Option Securities to be purchased on such Date of Delivery and otherwise to the
same effect as the opinion required by Section 5(h) hereof.
(viii) Opinion of Counsel for the Selling Stockholder. The favorable
opinion of Cleary, Gottlieb, Xxxxx & Xxxxxxxx, counsel for the Selling
Stockholder, dated such Date of Delivery, relating to the Option Securities to
be purchased on such Date of Delivery and otherwise to the same effect as the
opinion required by Section 5(i) hereof.
(ix) Opinion of Counsel for Underwriters. The favorable opinion of
Xxxxxx & Xxxxxxx Illinois LLC, counsel for the Underwriters, dated such Date of
Delivery, relating to the Option Securities to be purchased on such Date of
Delivery and otherwise to the same effect as the opinion required by Section
5(j) hereof.
(x) Bring-down Comfort Letter. A letter from KPMG LLP, in form and
substance satisfactory to the Representatives and dated such Date of Delivery,
substantially in the same form and substance as the letter furnished to the
Representatives pursuant to Section 5(m) hereof, except that the "specified
date" in the letter furnished pursuant to this paragraph shall be a date not
more than five days prior to such Date of Delivery.
(s) No Material Adverse Change. Neither the Company nor any of its
Subsidiaries shall have sustained since the date of the latest financial
statements included or incorporated by reference in the Prospectus (i) any loss
or interference with its business from fire, explosion, flood or other calamity,
whether or not covered by insurance, or from any labor dispute or court or
governmental action, order or decree, otherwise than as set forth or
contemplated in the Prospectus or (ii) since such date there shall not have been
any change in the capital stock or long-term debt of the Company or any of its
Subsidiaries or any change, or any development that could reasonably be expected
to result in a prospective change, in or affecting the general affairs,
management, financial position, stockholders' equity or results of operations of
the Company and its Subsidiaries, otherwise than as set forth or contemplated in
the Prospectus, the effect of which, in any such case described in clause (i) or
(ii), is or would be, in the judgment of the Representatives, so material and
adverse as to make it impracticable or inadvisable to proceed with the public
offering or the delivery of the Securities being delivered at the relevant
Closing Time or the relevant Date of Delivery on the terms and in the manner
contemplated in the Prospectus.
(t) Additional Documents. At Closing Time and at each Date of Delivery,
counsel for the Underwriters shall have been furnished with such documents and
opinions as they may reasonably require for the purpose of enabling them to pass
upon the issuance and sale of the Securities as herein contemplated, or in order
to evidence the accuracy of any of the representations or warranties, or the
fulfillment of any of the conditions, herein contained; and all
22
proceedings taken by the Company and the Selling Stockholder in connection with
the issuance and sale of the Securities as herein contemplated shall be
reasonably satisfactory in form and substance to the Representatives and counsel
for the Underwriters.
(u) Termination of Agreement. If any condition specified in this Section
shall not have been fulfilled when and as required to be fulfilled, this
Agreement, or, in the case of any condition to the purchase of Option
Securities, on a Date of Delivery which is after the Closing Time, the
obligations of the several Underwriters to purchase the relevant Option
Securities, may be terminated by the Representatives by notice to the Company
and the Selling Stockholder at any time at or prior to Closing Time or such Date
of Delivery, as the case may be, and such termination shall be without liability
of any party to any other party except as provided in Section 4 and except that
Sections 1, 6, 7 and 8 shall survive any such termination and remain in full
force and effect.
SECTION 6. Indemnification.
----------------
(a) Indemnification of Underwriters. The Company agrees to indemnify and
hold harmless each Underwriter, its directors, officers and employees and each
person, if any, who controls any Underwriter within the meaning of Section 15 of
the 1933 Act or Section 20 of the 1934 Act as follows:
(i) against any and all loss, liability, claim, damage, expense or
liability, joint or several, or any action in respect thereof (including,
but not limited to, any loss, claim, damage, liability or action relating
to purchases and sales of Securities), as incurred, arising out of (A) any
untrue statement or alleged untrue statement of a material fact contained
(x) in the preliminary prospectus, Registration Statement, Prospectus
Supplement or the Prospectus (or any amendment or supplement thereto), or
(y) in any materials or information provided to investors by, or with the
approval of, the Company in connection with the marketing of the offering
of the Securities ("Marketing Materials"), including any roadshow or
investor presentations made to investors by the Company (whether in person
or electronically), (B) the omission or alleged omission in any preliminary
prospectus, the Registration Statement, Prospectus Supplement or the
Prospectus (or any amendment or supplement thereto), or in any Marketing
Materials of a material fact required to be stated therein or necessary to
make the statements therein not misleading, in the light of the
circumstances under which they were made, not misleading, or (C) any act or
failure to act or any alleged act or failure to act by any Underwriter in
connection with, or relating in any manner to, the Securities or the
offering contemplated hereby, and which is included as part of or referred
to in any loss, claim, damage, liability or action arising out of or based
upon matters covered by clause (A) or (B) above (provided that the Company
shall not be liable under this clause (C) to the extent that it is
determined in a final judgment by a court of competent jurisdiction that
such loss, claim, damage, liability or action resulted directly from any
such acts or failures to act undertaken or omitted to be taken by such
Underwriter through its gross negligence or willful misconduct);
(ii) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, to the extent of the aggregate amount paid in
settlement of any litigation, or any
23
investigation or proceeding by any governmental agency or body, commenced
or threatened, or of any claim whatsoever based upon any such untrue
statement or omission, or any such alleged untrue statement or omission;
provided that (subject to Section 6(d) below) any such settlement is
effected with the written consent of the Company and the Selling
Stockholder; and
(iii) against any and all expense whatsoever, as incurred (including
the reasonable fees and disbursements of counsel chosen by Xxxxxx Brothers
and Xxxxxxx Xxxxx), reasonably incurred in investigating, preparing or
defending against any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim
whatsoever based upon any such untrue statement or omission, or any such
alleged untrue statement or omission, to the extent that any such expense
is not paid under (i) or (ii) above;
provided, however, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Company by any
Underwriter through Xxxxxx Brothers or Xxxxxxx Xxxxx expressly for use in the
Registration Statement (or any amendment thereto), or any preliminary
prospectus, Prospectus Supplement or the Prospectus (or any amendment or
supplement thereto), which information consists solely of the information
specified in Section 6(e) hereof. The foregoing indemnity agreement is in
addition to any liability which the Company may otherwise have to any
Underwriter or any officer, employee or controlling person of that Underwriter.
(b) Indemnification of Underwriters by the Selling Stockholder. The Selling
Stockholder, solely with respect to itself, agrees to indemnify and hold
harmless each Underwriter, its directors, officers and employees and each
person, if any, who controls any Underwriter within the meaning of Section 15 of
the 1933 Act or Section 20 of the 1934 Act against any and all loss, liability,
claim, damage, expense or liability, joint or several, or any action in respect
thereof (including, but not limited to, any loss, claim, damage, liability or
action relating to purchases and sales of Securities), as incurred, arising out
of (1) any untrue statement or alleged untrue statement of a material fact
contained in any preliminary prospectus, the Registration Statement, Prospectus
Supplement or the Prospectus (or in any amendment or supplement thereto), or (2)
the omission or alleged omission in any preliminary prospectus, the Registration
Statement, Prospectus Supplement or the Prospectus (or in any amendment or
supplement thereto), of a material fact required to be stated therein or
necessary to make the statements therein not misleading, in the light of the
circumstances under which they were made, in the case of subparagraphs (1) and
(2) of this Section 6(b) to the extent, but only to the extent, that such untrue
statement or alleged untrue statement or omission or alleged omission was made
in reliance upon or in conformity with written information furnished to the
Company or such Underwriter by the Selling Stockholder directly or through the
Selling Stockholder's representatives, specifically for use in the preparation
thereof; and shall reimburse each Underwriter, its directors, officers and
employees or controlling person in connection with investigating or defending or
preparing to defend against any such loss, claim, damage, liability or action as
such expenses are incurred; provided, however, that the Selling Stockholder
shall not be liable in any such case to the extent that any such loss,
liability, claim, damage or expense arises out of, or is based upon, any untrue
statement or omission or alleged untrue statement or
24
omission made in reliance upon and in conformity with written information
furnished to the Company by any Underwriter through Xxxxxx Brothers or Xxxxxxx
Xxxxx expressly for use in any preliminary prospectus, the Registration
Statement, Prospectus Supplement or the Prospectus (or in any amendment or
supplement thereto), which information consists solely of the information
specified in Section 6(e) hereof; and provided, further, that with respect to
any preliminary prospectus, the foregoing indemnity agreement shall not inure to
the benefit of any Underwriter from whom the person asserting any loss,
liability, claim, damage or expense purchased Securities, or any person
controlling such Underwriter, if copies of the Prospectus were timely delivered
to the Underwriter pursuant to this Agreement and a copy of the Prospectus (as
then amended or supplemented if the Company shall have furnished any amendments
or supplements thereto) was not sent or given by or on behalf of such
Underwriter to such person, if required by law so to have been delivered and if
the Prospectus (as so amended or supplemented) would have cured the defect
giving rise to such loss, liability, claim, damage or expense. However, in no
event shall the Selling Stockholder be liable under the provisions of this
Section 6 for any amount in excess of the total proceeds received by the Selling
Stockholder from the sale of the Securities by the Selling Stockholder (after
deducting commissions, but before taxes and any other expenses) pursuant to this
Agreement. The foregoing indemnity agreement is in addition to any liability
which the Selling Stockholder may otherwise have to any Underwriter or any
officer, employee or controlling person of that Underwriter.
(c) Indemnification of Company, Directors and Officers and Selling
Stockholder. Each Underwriter severally agrees to indemnify and hold harmless
the Company, its directors, each of its officers who signed the Registration
Statement, and each person, if any, who controls the Company within the meaning
of Section 15 of the 1933 Act or Section 20 of the 1934 Act, and the Selling
Stockholder and each person, if any, who controls the Selling Stockholder within
the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act against
any and all loss, liability, claim, damage and expense described in the
indemnity contained in subsections (a) and (b) of this Section, as incurred, but
only with respect to untrue statements or omissions, or alleged untrue
statements or omissions, made in the Registration Statement (or any amendment
thereto), or any preliminary prospectus, Prospectus Supplement or the Prospectus
(or any amendment or supplement thereto) in reliance upon and in conformity with
written information furnished to the Company by such Underwriter through Xxxxxx
Brothers or Xxxxxxx Xxxxx expressly for use in the Registration Statement (or
any amendment thereto) or such preliminary prospectus, Prospectus Supplement or
the Prospectus (or any amendment or supplement thereto), which information
consists solely of the information specified in Section 6(e) hereof. The
foregoing indemnity agreement is in addition to any liability which any
Underwriter may otherwise have to the Company or the Selling Stockholder or any
officer, employee or controlling person of the Company or the Selling
Stockholder.
(d) Actions against Parties; Notification. Each indemnified party shall
give notice as promptly as reasonably practicable to each indemnifying party of
any action commenced against it in respect of which indemnity may be sought
hereunder, but failure to so notify an indemnifying party shall not relieve such
indemnifying party from any liability hereunder to the extent it is not
materially prejudiced as a result thereof and in any event shall not relieve it
from any liability which it may have otherwise than on account of this indemnity
agreement. In the case of parties indemnified pursuant to Sections 6(a) and (b)
above, counsel to the indemnified parties shall be selected by Xxxxxx Brothers
and Xxxxxxx Xxxxx, and, in the case of parties
25
indemnified pursuant to Section 6(c) above, counsel to the indemnified parties
shall be selected by the Company or the Selling Stockholder, as the case may be.
An indemnifying party may participate at its own expense in the defense of any
such action; provided, however, that counsel to the indemnifying party shall not
(except with the consent of the indemnified party) also be counsel to the
indemnified party. In no event shall the indemnifying parties be liable for fees
and expenses of more than one counsel (in addition to any local counsel)
separate from their own counsel for all indemnified parties in connection with
any one action or separate but similar or related actions in the same
jurisdiction arising out of the same general allegations or circumstances. No
indemnifying party shall, without the prior written consent of the indemnified
parties (which consent will not be unreasonably withheld), settle or compromise
or consent to the entry of any judgment with respect to any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever in respect of which indemnification or
contribution could be sought under this Section 6 or Section 7 hereof (whether
or not the indemnified parties are actual or potential parties thereto), unless
such settlement, compromise or consent (i) includes an unconditional release of
each indemnified party from all liability arising out of such litigation,
investigation, proceeding or claim 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 any
indemnified party.
(e) Information Furnished by Underwriters. The Underwriters confirm and the
Company and the Selling Stockholder acknowledge that the statements with respect
to the public offering of the Securities by the Underwriters set forth on the
cover page of, the name of the Underwriters and its participation in the sale of
Securities under the caption "Underwriting" in, the paragraphs addressing the
underwriting discount, concessions and reallowances, stabilization, short
positions, syndicate transactions and penalty bids appearing under the caption
"Underwriting" in, the paragraph "Relationships" appearing under the caption
"Underwriting" in, and the information under the caption "Notice to Canadian
Residents" in, the Prospectus constitute the only information concerning the
Underwriters furnished in writing to the Company by or on behalf of the
Underwriters specifically for inclusion in the Registration Statement and the
Prospectus.
(f) Settlement without Consent if Failure to Reimburse. If at any time an
indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel, such indemnifying party
agrees that it shall be liable for any settlement of the nature contemplated by
Section 6(a)(ii) effected without its written consent if (i) such settlement is
entered into more than 45 days after receipt by such indemnifying party of the
aforesaid request, (ii) such indemnifying party shall have received notice of
the terms of such settlement at least 30 days prior to such settlement being
entered into and (iii) such indemnifying party shall not have reimbursed such
indemnified party in accordance with such request prior to the date of such
settlement.
(g) Other Agreements with Respect to Indemnification. The provisions of
this Section shall not affect any agreement between the Company and the Selling
Stockholder with respect to indemnification.
SECTION 7. Contribution. If the indemnification provided for in Section 6 hereof
is for any reason unavailable to or insufficient to hold harmless an indemnified
party in respect of any
26
losses, liabilities, claims, damages or expenses referred to therein, then each
indemnifying party shall contribute to the aggregate amount of such losses,
liabilities, claims, damages and expenses incurred by such indemnified party, as
incurred, (i) in such proportion as is appropriate to reflect the relative
benefits received by the Company and the Selling Stockholder on the one hand and
the Underwriters on the other hand from the offering of the Securities pursuant
to this Agreement or (ii) if the allocation provided by clause (i) is not
permitted by applicable law, in such proportion as is appropriate to reflect not
only the relative benefits referred to in clause (i) above but also the relative
fault of the Company and the Selling Stockholder on the one hand and of the
Underwriters on the other hand in connection with the statements or omissions
which resulted in such losses, liabilities, claims, damages or expenses, as well
as any other relevant equitable considerations.
The relative benefits received by the Company and the Selling Stockholder
on the one hand and the Underwriters on the other hand in connection with the
offering of the Securities pursuant to this Agreement shall be deemed to be in
the same respective proportions as the total net proceeds from the offering of
the Securities pursuant to this Agreement (before deducting expenses) received
by the Company and the Selling Stockholder and the total underwriting discount
received by the Underwriters, in each case as set forth on the cover of the
Prospectus, bear to the aggregate initial public offering price of the
Securities as set forth on such cover.
The relative fault of the Company and the Selling Stockholder on the one
hand and the Underwriters on the other hand shall be determined by reference to,
among other things, whether any such untrue or alleged untrue statement of a
material fact or omission or alleged omission to state a material fact relates
to information supplied by the Company or the Selling Stockholder or by the
Underwriters and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission.
The Company, the Selling Stockholder and the Underwriters agree that it
would not be just and equitable if contribution pursuant to this Section 7 were
determined by pro rata allocation (even if the Underwriters were treated as one
entity for such purpose) or by any other method of allocation which does not
take account of the equitable considerations referred to above in this Section
7. The aggregate amount of losses, liabilities, claims, damages and expenses
incurred by an indemnified party and referred to above in this Section 7 shall
be deemed to include any legal or other expenses reasonably incurred by such
indemnified party in investigating, preparing or defending against any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever based upon any such
untrue or alleged untrue statement or omission or alleged omission.
Notwithstanding the provisions of this Section 7, no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the Securities underwritten by it and distributed to the public
were offered to the public exceeds the amount of any damages which such
Underwriter has otherwise been required to pay by reason of any such untrue or
alleged untrue statement or omission or alleged omission.
No Selling Stockholder shall be required to contribute any amount in excess
of the total proceeds received by such Selling Stockholder from the offering of
the Securities by such Selling Stockholder (after deducting commissions, but
before taxes and other expenses).
27
No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the 0000 Xxx) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 7, each person, if any, who controls an
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act shall have the same rights to contribution as such Underwriter, and
each director of the Company, each officer of the Company who signed the
Registration Statement, and each person, if any, who controls the Company or the
Selling Stockholder within the meaning of Section 15 of the 1933 Act or Section
20 of the 1934 Act shall have the same rights to contribution as the Company or
the Selling Stockholder, as the case may be. The Underwriters' respective
obligations to contribute pursuant to this Section 7 are several in proportion
to the number of Initial Securities set forth opposite their respective names in
Schedule 1 hereto and not joint.
The provisions of this Section shall not affect any agreement between the
Company and the Selling Stockholder with respect to contribution.
SECTION 8. Representations, Warranties and Agreements to Survive Delivery. All
representations, warranties and agreements contained in this Agreement or in
certificates of officers of the Company or any of its Subsidiaries or the
Selling Stockholder submitted pursuant hereto, shall remain operative and in
full force and effect, regardless of any investigation made by or on behalf of
any Underwriter or controlling person, or by or on behalf of the Company or the
Selling Stockholder, and shall survive delivery of the Securities to the
Underwriters.
SECTION 9. Termination of Agreement.
-------------------------
(a) Termination; General. The Representatives may terminate this Agreement,
by notice to the Company and the Selling Stockholder, at any time at or prior to
Closing Time (i) if there has been, since the time of execution of this
Agreement or since the respective dates as of which information is given in the
Prospectus (exclusive of any amendment or supplement thereto), any material
adverse change in the condition, financial or otherwise, or in the earnings,
business affairs or business prospects of the Company and its Subsidiaries
considered as one enterprise, whether or not arising in the ordinary course of
business, or (ii) if there has occurred any material adverse change in the
financial markets in the United States or in the international financial
markets, any outbreak of hostilities or escalation thereof or other calamity or
crisis or any change or development involving a prospective change in national
or international political, financial or economic conditions, including, without
limitation, as a result of terrorist activities, in each case the effect of
which is such as to make it, in the judgment of the Representatives,
impracticable or inadvisable to market the Securities or to enforce contracts
for the sale of the Securities, or (iii) if trading in any securities of the
Company has been suspended or materially limited by the Commission or the New
York Stock Exchange, or if trading generally on the American Stock Exchange or
the New York Stock Exchange or in the Nasdaq National Market has been suspended
or materially limited, or minimum or maximum prices for trading have been fixed,
or maximum ranges for prices have been required, by any of said exchanges or by
such system or by order of the Commission, the National Association of
Securities Dealers, Inc. or any other governmental authority, or a material
disruption has occurred in commercial banking
28
or securities settlement or clearance services in the United States, or (iv) if
a banking moratorium has been declared by either Federal or New York
authorities.
(b) Liabilities. If this Agreement is terminated pursuant to this Section,
such termination shall be without liability of any party to any other party
except as provided in Section 4 hereof, and provided further that Sections 1, 6,
7 and 8 shall survive such termination and remain in full force and effect.
SECTION 10. Default by One or More of the Underwriters. If one or more of the
Underwriters shall fail at Closing Time or a Date of Delivery to purchase the
Securities which it or they are obligated to purchase under this Agreement (the
"Defaulted Securities"), the Representatives shall have the right, within 24
hours thereafter, to make arrangements for one or more of the non-defaulting
Underwriters, or any other underwriters, to purchase all, but not less than all,
of the Defaulted Securities in such amounts as may be agreed upon and upon the
terms herein set forth; if, however, the Representatives shall not have
completed such arrangements within such 24-hour period, then:
(a) if the number of Defaulted Securities does not exceed 10% of the
number of Securities to be purchased on such date, each of the
non-defaulting Underwriters shall be obligated, severally and not jointly,
to purchase the full amount thereof in the proportions that their
respective underwriting obligations hereunder bear to the underwriting
obligations of all non-defaulting Underwriters, or
(b) if the number of Defaulted Securities exceeds 10% of the number of
Securities to be purchased on such date, this Agreement or, with respect to
any Date of Delivery which occurs after the Closing Time, the obligation of
the Underwriters to purchase and of the Company to sell the Option
Securities to be purchased and sold on such Date of Delivery, shall
terminate without liability on the part of any non-defaulting Underwriter.
No action taken pursuant to this Section shall relieve any defaulting
Underwriter from liability in respect of its default.
In the event of any such default which does not result in a termination of
this Agreement or, in the case of a Date of Delivery which is after the Closing
Time, which does not result in a termination of the obligation of the
Underwriters to purchase and the Company to sell the relevant Option Securities,
as the case may be, either the Representatives or the Company and the Selling
Stockholder shall have the right to postpone Closing Time or the relevant Date
of Delivery, as the case may be, for a period not exceeding seven days in order
to effect any required changes in the Registration Statement or Prospectus or in
any other documents or arrangements. As used herein, the term "Underwriter"
includes any person substituted for an Underwriter under this Section 10.
SECTION 11. Default by the Selling Stockholder or the Company.
--------------------------------------------------
(a) If the Selling Stockholder shall fail at Closing Time or at a Date of
Delivery to sell and deliver the number of Securities which the Selling
Stockholder is obligated to sell hereunder, then the Underwriters may, at the
option of the Representatives, by notice from the
29
Representatives to the Company and the Selling Stockholder, either (i) terminate
this Agreement without any liability on the fault of any non-defaulting party
except that the provisions of Sections 1, 4, 6, 7 and 8 shall remain in full
force and effect or (ii) elect to purchase the Securities which the Company has
agreed to sell hereunder. No action taken pursuant to this Section 11 shall
relieve the Selling Stockholder so defaulting from liability, if any, in respect
of such default.
In the event of a default by the Selling Stockholder as referred to in this
Section 11, each of the Representatives and the Company shall have the right to
postpone Closing Time or Date of Delivery for a period not exceeding seven days
in order to effect any required change in the Registration Statement or
Prospectus or in any other documents or arrangements.
(b) If the Company shall fail at Closing Time or at the Date of Delivery to
sell the number of Securities that it is obligated to sell hereunder, then this
Agreement shall terminate without any liability on the part of any nondefaulting
party; provided, however, that the provisions of Sections 1, 4, 6, 7 and 8 shall
remain in full force and effect. No action taken pursuant to this Section shall
relieve the Company from liability, if any, respect of such default.
SECTION 12. Notices. All notices and other communications hereunder shall be in
writing and shall be deemed to have been duly given if mailed or transmitted by
any standard form of telecommunication. Notices to the Underwriters shall be
directed to the Representatives at Xxxxxx Brothers Inc., 000 Xxxxxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000, attention of Syndicate Registration Department (Fax: (212)
000-0000), with a copy, in the case of any notice pursuant to Section 6(c), to
the Director of Litigation, Office of the General Counsel, Xxxxxx Brothers Inc.,
000 Xxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, XX 00000, and at Xxxxxxx Lynch, Pierce,
Xxxxxx & Xxxxx Incorporated, 0000 X Xxxxxx Xxx, Xxxx Xxxx, XX 00000-0000,
attention of Xxxx Xxxxxx; notices to the Company shall be directed to it at 000
Xxxxx Xxxxx (City of X'Xxxxxx), Xx. Xxxxxx, Xxxxxxxx 00000, attention of Xxxxx
X. Xxxxxxxx (Fax: (000) 000-0000); and notices to the Selling Stockholder shall
be directed to TPG Wafer Holdings LLC, c/o Texas Pacific Group, 000 Xxxxxxxx
Xxxxxx, Xxxxx 0000, Xxxx Xxxxx, XX 00000 (Fax: (000) 000-0000), attention of
Xxxxxxx X. Xxxxxxxxx.
SECTION 13. Counterparts. This Agreement may be executed in one or more
counterparts and, if executed in more than one counterpart, the executed
counterparts shall each be deemed to be an original but all such counterparts
shall together constitute one and the same instrument.
SECTION 14. Parties. This Agreement shall each inure to the benefit of and be
binding upon the Underwriters, the Company and the Selling Stockholder and their
respective successors. Nothing expressed or mentioned in this Agreement is
intended or shall be construed to give any person, firm or corporation, other
than the Underwriters, the Company and the Selling Stockholder and their
respective successors and the controlling persons and officers and directors
referred to in Sections 6 and 7 and their heirs and legal representatives, any
legal or equitable right, remedy or claim under or in respect of this Agreement
or any provision herein contained. This Agreement and all conditions and
provisions hereof are intended to be for the sole and exclusive benefit of the
Underwriters, the Company and the Selling Stockholder and their respective
successors, and said controlling persons and officers and directors and their
heirs and legal representatives, and for the benefit of no other person, firm or
corporation. No purchaser of
30
Securities from any Underwriter shall be deemed to be a successor by reason
merely of such purchase.
SECTION 15. GOVERNING LAW AND TIME. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. SPECIFIED TIMES
OF DAY REFER TO NEW YORK CITY TIME.
SECTION 16. Effect of Headings. The Article and Section headings herein and the
Table of Contents are for convenience only and shall not affect the construction
hereof.
31
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Company a counterpart hereof, whereupon
this instrument, along with all counterparts, will become a binding agreement
between the Underwriters and the Company in accordance with its terms.
Very truly yours,
MEMC ELECTRONIC MATERIALS, INC.
By Xxxxxxx X. Xxxxx
---------------------------------
Title: Treasurer
TPG WAFER HOLDINGS LLC
By: TPG WAFER PARTNERS LLC,
its managing member
By /s/ Xxxxxxx X. Xxxxxxxxx
---------------------------------
Name: Xxxxxxx X. Xxxxxxxxx
Title: Vice President
CONFIRMED AND ACCEPTED,
as of the date first above written:
XXXXXX BROTHERS INC.
XXXXXXX XXXXX & CO.
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX
INCORPORATED
CITIGROUP GLOBAL MARKETS INC.
DEUTSCHE BANK SECURITIES INC.
UBS WARBURG LLC
By: XXXXXX BROTHERS INC.
By /s/ Xxxxx Xxxxxxxx
------------------------------------
Authorized Signatory
By: XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX
INCORPORATED
By /s/ Xxxx Xxxxxx
------------------------------------
Authorized Signatory
For themselves and as Representatives of the other Underwriters named in
Schedule 1 hereto.
32
SCHEDULE 1
Number of
Initial
Name of Underwriter Securities
------------------- ----------
Xxxxxx Brothers Inc. ...................................... 6,898,125
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx 6,898,125
Incorporated ..................................
Citigroup Global Markets Inc. ............................. 3,183,750
Deutsche Bank Securities Inc. ............................. 2,122,500
UBS Warburg LLC ........................................... 2,122,500
Wachovia Securities, Inc. ................................. 175,000
Xxxxx, Xxxxxxxx & Xxxx, Inc. .............................. 150,000
Chatsworth Securities LLC ................................. 150,000
JMP Securities LLC ........................................ 150,000
ThinkEquity Partners LLC .................................. 150,000
----------
Total 22,000,000
Sch 1-1
SCHEDULE 2
Number of Initial Maximum Number of Option
Securities to be Sold Securities to Be Sold
--------------------- ---------------------
MEMC Electronic Materials, Inc. 10,000,000 --
TPG Wafer Holdings LLC 12,000,000 3,300,000
Total 22,000,000 3,300,000
========== =========
Sch 2-1
SCHEDULE 3
MEMC ELECTRONIC MATERIALS, INC.
22,000,000 Shares of Common Stock
(Par Value $.01 Per Share)
1. The initial public offering price per share for the Securities,
determined as provided in said Section 2, shall be $10.00
2. The purchase price per share for the Securities to be paid by the
several Underwriters shall be $9.525, being an amount equal to the initial
public offering price set forth above less $0.475 per share; provided that the
purchase price per share for any Option Securities purchased upon the exercise
of the over-allotment option described in Section 2(b) shall be reduced by an
amount per share equal to any dividends or distributions declared by the Company
and payable on the Initial Securities but not payable on the Option Securities.
Sch 2-1
SCHEDULE 4
List of Subsidiaries
MEMC Electronic Materials (UK) Ltd.
MEMC Electronic Materials France Sarl
MEMC Electronic Materials Sales, Sdn. Bhd.
MEMC Electronic Materials, GmbH
MEMC Electronic Materials, S.p.A.
MEMC Electronic Materials, Sdn. Bhd.
MEMC Holding B.V.
MEMC Holdings Corporation
MEMC International, Inc.
MEMC Japan Ltd.
MEMC Korea Company
MEMC Kulim Electronic Materials, Sdn. Bhd.
MEMC Pasadena, Inc.
MEMC Southwest Inc.
PlasmaSil, LLC
SiBond, LLC
Sch 3-1
SCHEDULE 5
List of persons and entities
subject to lock-up
Xxxxxx Xxxxxx
Xxxxxxxx X. Xxxxxx
Xxxxxxxxxxxxx Xxxxxxxxx
Xxxxxx X. Xxxxxxxx
Xxxxx X. Xxxxxx
Xxxxx X. Xxxxxxxx
Xxxxxx X. Xxxxxxx
Xxxx-Xxxx Xxxxxx
Xxxxx X. Xxxxxxx
Xxxx X. Xxxxxxx
Xxxx X. Xxxxxx
C. Xxxxxxx Xxxxx
Xxxx Xxxxxx
Xxxxxxx X. Xxxxxxx
Xxxxxxx X. Xxxxxxx
TPG Wafer Holdings LLC
Sch 4-1
