EXHIBIT 1(b)
XXXX XXXXX, INC.
(a Maryland corporation)
Common Stock
FORM OF UNDERWRITING AGREEMENT
To the Underwriters
to be named in Schedule A hereto
Ladies and Gentlemen:
Xxxx Xxxxx, Inc., a Maryland corporation (the "Company"), confirms its
agreement with [ ] (the "Representative") and each of the other Underwriters
named in Schedule A hereto (collectively, the "Underwriters", which term shall
also include any underwriter substituted as hereinafter provided in Section 10
hereof), with respect to the issue and sale by the Company and the purchase by
the Underwriters, acting severally and not jointly, of the respective numbers of
shares of Common Stock, par value $.10 per share, of the Company ("Common
Stock") set forth in said Schedule A, and with respect to the grant by the
Company to the Underwriters, acting severally and not jointly, of the option
described in Section 2(b) hereof to purchase all or any part of [ ] additional
shares of Common Stock to cover overallotments, if any. The aforesaid [ ] shares
of Common Stock (the "Initial Securities") to be purchased by the Underwriters
and all or any part of the [ ] 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 understands that the Underwriters propose to make a public
offering of the Securities as soon as they 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. [ ]), including the
related preliminary prospectus or prospectuses, and Post Effective Amendment No.
1 to its Registration Statement on Form S-3 (No. 333-100156) covering the
registration of the Securities under the Securities Act of 1933, as amended (the
"1933 Act"). Promptly after execution and delivery of this Agreement, the
Company will prepare and file a prospectus in accordance with the provisions of
Rule 430A ("Rule 430A") of the rules and regulations of the Commission under the
1933 Act (the "1933 Act Regulations") and paragraph (b) of Rule 424 ("Rule
424(b)") of the 1933 Act Regulations. The information included in such
prospectus that was omitted from such registration statement at the time it
became effective but that is deemed to be part of such registration statement at
the time it became effective pursuant to paragraph (b) of Rule 430A is referred
to as "Rule 430A Information." Such registration statement, including the
exhibits and any schedules thereto, at the time it became effective, and
including documents incorporated by reference therein pursuant to Item 12 of
Form S-3 under the 1933 Act at such time and the Rule 430A Information, 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 final prospectus in the form first furnished to the Underwriters for use in
connection with the offering of the Securities, including the documents
incorporated by reference therein pursuant to Item 12 of Form S-3 under the 1933
Act at the time of the execution of this Agreement, is herein called the
"Prospectus." For purposes of this Agreement, all references to the Registration
Statement, the Prospectus 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 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, 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) The Company meets the requirements for use of Form S-3 under
the 1933 Act. Each of the Registration Statement, any Rule 462(b)
Registration Statement and any post-effective amendment thereto has
become effective under the 1933 Act and no stop order suspending the
effectiveness of the Registration Statement, any Rule 462(b)
Registration Statement or any post-effective amendment thereto 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 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
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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 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 written information furnished to
the Company by any Underwriter through the Representative expressly
for use in the Registration Statement (or any amendment thereto) or
the Prospectus (or any amendment or supplement thereto).
The prospectus filed as part of the Registration Statement
as originally filed or as part of any amendment thereto, complied when
so filed in all material respects with the 1933 Act Regulations 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) 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 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 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) [ ], which certified the financial statements and
supporting schedules included in the Registration Statement, is an
independent public accounting firm within the meaning of the 1933 Act
and the 1933 Act Regulations and the regulations of the Public Company
Accounting Oversight Board, for the periods so reported.
(iv) 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 ("GAAP") applied on a consistent basis
throughout the periods involved and comply as to form with the
applicable accounting requirements of the 1933 Act and the 1933 Act
Regulations. The supporting schedules, if any, included in the
Registration Statement present fairly in accordance with GAAP the
information required to be stated therein. The selected financial data
and the summary financial information included in the Prospectus
present
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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) 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.
(vi) The Company has been duly incorporated or organized and is
validly existing in good standing under the laws of the jurisdiction
in which it is chartered or organized with all requisite power and
authority to own or lease, as the case may be, and to operate its
properties and conduct its business as described in the Prospectus,
and is duly qualified to do business as a foreign corporation or
organization and is in good standing under the laws of each
jurisdiction which requires such qualification, 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) Except as would not result in a Material Adverse Effect,
each of the Company's subsidiaries: (A) has been duly incorporated or
organized, (B) is validly existing in good standing under the laws of
the jurisdiction in which it is chartered or organized with all
requisite power and authority to own or lease, as the case may be, and
to operate its properties and conduct its business as described in the
Prospectus, and (C) is duly qualified to do business as a foreign
corporation or organization and is in good standing under the laws of
each jurisdiction which requires such qualification, whether by reason
of the ownership or leasing of property or the conduct of business.
(viii) The Company's authorized, issued and outstanding capital
stock as of [ ] is as set forth in the Prospectus
Supplement in the column titled "Actual" under the caption
"Capitalization "; the outstanding shares of capital stock of the
Company have been duly and validly authorized and issued and are fully
paid and nonassessable; and none of the outstanding shares of capital
stock of the Company was issued in violation of the preemptive or
similar rights of any securityholder of the Company.
(ix) Except as would not result in a Material Adverse Effect: (A)
all the outstanding shares of capital stock of each of the Company's
subsidiaries have been duly and validly authorized and issued and are
fully paid and nonassessable, and (B) except as may be otherwise set
forth in the Prospectus, all outstanding shares of capital stock of
such subsidiaries are owned by the Company either directly or through
wholly owned subsidiaries free and clear of any security interest,
mortgage, pledge, lien, encumbrance or claim.
(x) All subsidiaries of the Company, other than subsidiaries that
considered in the aggregate as a single subsidiary, do not constitute
a "significant subsidiary" as defined in Rule 1-02 of Regulation S-X,
are listed on Schedule C hereto.
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(xi) 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 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.
(xii) This Agreement has been duly authorized, executed and
delivered by the Company.
(xiii) The issued and outstanding capital stock of the Company
conforms, and the Securities, upon their issuance and sale in
accordance with this Agreement will conform, in all material respects
to the description of thereof in the Prospectus under the caption
"Description of capital Stock".
(xiv) The Company is not and, after giving effect to the offering
and sale of the Securities and the application of the proceeds thereof
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.
(xv) No consent, approval, authorization, order, registration or
qualification with any court or governmental agency or body is
required for the performance by the Company of its obligations
hereunder in connection with the offering, issuance or sale of the
Securities or in connection with the consummation of the transactions
contemplated by this Agreement, except such as have been already
obtained or will have been obtained prior to the Closing Time.
(xvi) The execution, delivery and performance of this Agreement
and the consummation of the transactions contemplated herein and in
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 will have been duly
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, result in a breach or violation of, or imposition
of any lien, charge or encumbrance upon any property or assets of the
Company or any of its subsidiaries pursuant to (i) the charter or
by-laws of the Company (ii) the charter or by-laws (or other similar
documents) of any of the Company's subsidiaries; (iii) the terms of
any indenture, contract, lease, mortgage, deed of trust, note
agreement, loan agreement or other agreement, obligation, condition,
covenant or instrument to which the Company or any of its subsidiaries
is a party or bound or to which its or their property is subject; or
(iv) any statute, law, rule, regulation, judgment, order or decree
applicable to the Company or any of its subsidiaries of any court,
regulatory body, administrative agency, governmental body, arbitrator
or other authority having jurisdiction over the Company or any of its
subsidiaries or any of its or
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their assets, properties, or operations; except in the cases of
clauses (ii) through (iv) as would not result in a Material Adverse
Effect.
(xvii) 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 that (i) could reasonably be expected to result in a
material adverse effect on the performance of this Agreement or the
consummation of any of the transactions contemplated hereby or (ii)
could reasonably be expected to result in a Material Adverse Effect;
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 Prospectus, including ordinary routine litigation
incidental to the business, could not reasonably be expected to result
in a Material Adverse Effect; and no labor disturbance by or dispute
with the employees of the Company or any of its subsidiaries exists or
is, to the best knowledge of the Company, threatened or imminent that
could reasonably be expected to have a Material Adverse Effect.
(xviii) Each of the Company and each of its subsidiaries has good
and marketable title to all real property owned by them respectively
and good title to all other properties owned by them respectively, 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 Prospectus or (b) do not in the
aggregate materially affect the value of such property and do not
interfere with the use made and proposed to be made of such property
by the Company or any of its subsidiaries; each of the Company and
each of its subsidiaries owns or leases all such properties as are
necessary to the conduct of its operations as presently conducted;
neither the Company nor any subsidiary is in non-compliance with any
term or condition of, or has failed to obtain and maintain in effect,
any license, certificate, permit or other governmental authorization
required for the ownership or lease of its property or the conduct of
its business, which violation, noncompliance or failure would
individually or in the aggregate have a Material Adverse Effect and
the Company has not received notice of any proceedings relating to the
revocation or modification of any such license, certificate, permit or
other authorization, which revocation or material modification could
reasonably be expected to have a Material Adverse Effect.
(xix) (A) The Company is not in violation or default of any
provision of its charter or by-laws, (B) none of the Company's
subsidiaries is in violation or default of any provision of its
charter or by-laws (or other similar documents) and (C) neither the
Company nor any subsidiary is in violation or default of (I) the terms
of any indenture, contract, lease, mortgage, deed of trust, note
agreement, loan agreement or other agreement, obligation, condition,
covenant or instrument to which it is a party or bound or to which its
property is subject, or (II) any statute, law, rule, regulation,
judgment, order or decree of any Federal, state, local or foreign
court, regulatory body, administrative agency, governmental body,
arbitrator or other authority having jurisdiction over the Company or
such subsidiary or any of its or their properties, as
6
applicable, which violation or default, in the case of clauses (B) and
(C), would have a Material Adverse Effect.
(xx) The Company has filed all foreign, federal, state and local
tax returns that are required to be filed or has requested extensions
thereof (except in any case in which the failure so to file would not
have a Material Adverse Effect) and has paid all taxes required to be
paid by it and any other assessment, fine or penalty levied against
it, to the extent that any of the foregoing is due and payable, except
for any such assessment, fine or penalty that is currently being
contested in good faith or as would not have a Material Adverse
Effect.
(xxi) The Company and its subsidiaries, as an entity, are insured
by insurers of recognized financial responsibility against such losses
and risks and in such amounts as are prudent and customary in the
businesses in which they are engaged; neither the Company nor any such
subsidiary has been refused any insurance coverage sought or applied
for; and neither the Company nor any such subsidiary has any reason to
believe that it will not be able to renew its existing insurance
coverage as and when such coverage expires, should it elect to do so,
or to obtain similar coverage from similar insurers as may be
necessary to continue its business at a cost that would not have a
Material Adverse Effect.
(xxii) No subsidiary of the Company is currently prohibited,
directly or indirectly, from paying any dividends to the Company, from
making any other distribution on such subsidiary's capital stock, from
repaying to the Company any loans or advances to such subsidiary from
the Company or from transferring any of such subsidiary's property or
assets to the Company or any other subsidiary of the Company, except
as may be described in or contemplated by the Prospectus (including in
the Company's Annual Report on Form 10-K for the year ended March 31,
[ ], incorporated therein by reference, under the heading, "Business
- Asset Management Segment") and except as would not result in a
Material Adverse Effect.
(xxiii) The Company and its subsidiaries possess all
certificates, authorizations and permits issued by the appropriate
Federal, state or foreign regulatory authorities necessary to conduct
their respective businesses, except for such certificates,
authorizations and permits as to which the failure to so own, hold or
possess would not have a Material Adverse Effect, and neither the
Company nor any such subsidiary has received any notice of proceedings
relating to the revocation or modification of any such certificate,
authorization or permit which, singly or in the aggregate, if the
subject of any unfavorable decision, ruling or finding, would result
in a Material Adverse Effect.
(xxiv) Neither the Company nor any of its subsidiaries is in
violation of any Federal or state law or regulation relating to
occupational safety and health or to the storage, handling or
transportation of hazardous or toxic materials; the Company and its
subsidiaries have received all permits, licenses or other approval
required of them under applicable Federal and state occupational
safety and health and environmental laws and regulations to conduct
their respective businesses; and the Company and each such subsidiary
is in compliance with all terms and conditions of any such permit,
license or
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approval, except any such violation of law or regulation, failure to
receive required permits, licenses or other approvals or failure to
comply with the terms and conditions of such permits, licenses or
approvals which would not, singly or in the aggregate, result in a
Material Adverse Effect.
(xxv) The Company and each of its subsidiaries owns, possesses,
licenses, or has other rights to use all material patents, patent
applications, trade and service marks, trade and service xxxx
registrations, trade names, copyrights, licenses, inventions, trade
secrets, technology, know-how and other intellectual property
(collectively, the "Intellectual Property") necessary for the conduct
of their business, taken as a whole, as now conducted 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 render any Intellectual Property
invalid or inadequate to protect the interest of the Company or any of
its subsidiaries therein, other than as disclosed in the Company's
Annual Report or Form 10-K for the fiscal year ended March 31, [ ]
or other than infringements or conflicts or conditions of invalidity
or inadequacy which (if the subject of any unfavorable decision,
ruling or finding), singly or in the aggregate, would not result in a
Material Adverse Effect, subject to such limitations on the use of,
or the rights to use such Intellectual Property that, individually
or in the aggregate, would not have a Material Adverse Effect.
(xxvi) Except as disclosed in the Prospectus, the Company and
each of its subsidiaries has fulfilled its obligations, if any, under
the minimum funding standards of Xxxxxxx 000 xx xxx Xxxxxx Xxxxxx
Employee Retirement Income Security Act of 1974 ("ERISA") and the
regulations and published interpretations thereunder with respect to
each "plan" (as defined in Section 3(3) of ERISA and such regulations
and published interpretations) in which employees of the Company or
its subsidiaries are eligible to participate and each such plan is in
compliance in all material respects with the presently applicable
provisions of ERISA and such regulations and published
interpretations, other than such non-compliance that would not have a
Material Adverse Effect. The Company and its subsidiaries have not
incurred any unpaid liability to the Pension Benefit Guaranty
Corporation (other than for the payment of premiums in the ordinary
course) or to any such plan under Title IV of ERISA.
(xxvii) Since the respective dates as of which information is
given in 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 not described
in the Prospectus.
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(xxviii) The Company is subject to the reporting requirements of
Section 13 or Section 15(d) of the 1934 Act.
(xxix) The Company has not taken, and will not take, directly or
indirectly, any action prohibited by Regulation M under the 1934 Act
in connection with the offering of the Securities.
(xxx) The Company is not required to be registered, licensed or
qualified as an investment adviser or a broker-dealer or as a
commodity trading advisor, a commodity pool operator or a future
commission merchant or any or all of the foregoing, as applicable;
each of the Company's subsidiaries that is required to be registered,
licensed or qualified as an investment adviser or a broker-dealer or
as a commodity trading advisor, a commodity pool operator or a futures
commission merchant or any or all of the foregoing, as applicable, is
so registered, licensed or qualified in each jurisdiction where the
conduct of its business requires such registration, license or
qualification (and such registration, license or qualification is in
full force and effect), and is in compliance with all applicable laws
requiring any such registration, licensing or qualification, except
for any failures to be so registered, licensed or qualified or to be
in such compliance that, individually or in the aggregate, would not
reasonably be expected to have a Material Adverse Effect.
(xxxi) The Company is not a party as an investment advisor or
distributor to any investment advisory agreement or distribution
agreement; each of the investment advisory agreements and distribution
agreements to which any of the Company's subsidiaries is a party is a
valid and legally binding obligation of such subsidiary which is a
party thereto and complies with the applicable provisions of the
Investment Advisers Act of 1940, as amended (the "Advisers Act"),
except for any failures to be so valid and legally binding and in
compliance that, individually or in the aggregate, would not
reasonably be expected to have a Material Adverse Effect; and none of
the Company's subsidiaries is in breach or violation of or in default
under any such agreement which breach, violation, default or
invalidity, individually or in the aggregate, would reasonably be
expected to have a Material Adverse Effect.
(xxxii) The Company does not sponsor any funds; each fund
sponsored by any of the Company's subsidiaries (a "Fund" or the
"Funds") and which is required to be registered with the Commission as
an investment company under the Investment Company Act of 1940, as
amended (the "Investment Company Act") is duly registered with the
Commission as an investment company under the Investment Company Act,
except for any failures to be so registered that, individually or in
the aggregate, would not reasonably be expected to have a Material
Adverse Effect.
(b) Officer's Certificates. Any certificate signed by any officer of the
Company or any of its subsidiaries delivered to the Underwriters 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.
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SECTION 2. Sale and Delivery to Underwriters; Closing.
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(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 agrees to sell to each Underwriter, severally and not jointly, and each
Underwriter, severally and not jointly, agrees to purchase from the Company, at
the price per share set forth in Schedule B, the number of Initial Securities
set forth in Schedule A 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.
(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 Company hereby grants an option to the Underwriters, severally and
not jointly, to purchase up to an additional [ ] shares of Common Stock at the
price per share set forth in Schedule B. 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 overallotments which may be made in
connection with the offering and distribution of the Initial Securities upon
notice by the Representative to the Company 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
Representative, 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 A
opposite the name of such Underwriter bears to the total number of Initial
Securities, subject in each case to such adjustments as the Representative in
its 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 [ ],
[address], or at such other place as shall be agreed upon by the Underwriters
and the Company, at 9:00 A.M. (Eastern time) on [ ] (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 Underwriters
and the Company (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 Underwriters and
the Company, on each Date of Delivery as specified in the notice from the
Underwriters to the Company.
Payment shall be made to the Company by wire transfer of immediately
available funds to a bank account designated by the Company, against delivery to
the Underwriters for their respective accounts of certificates for the
Securities to be purchased by them. The Representative, 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
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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 Underwriters may request in writing at least one full
business day 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
Underwriters 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 Rule 430A
and will notify the Underwriters promptly as practicable, and confirm the 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 any
document incorporated by reference therein 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 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. The Company will give the Underwriters notice of
its intention to file or prepare any amendment to the Registration Statement
(including any filing under Rule 462(b)) 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 Underwriters 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
Underwriters or counsel for the Underwriters shall reasonably object unless
required to do so pursuant to applicable provisions of the securities laws.
(c) Delivery of Registration Statements. The Company has furnished or will
deliver to the Underwriters 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
11
incorporated by reference therein) and signed copies of all consents and
certificates of experts, and will also deliver to the each of the Underwriters,
without charge, a conformed copy of the Registration Statement as originally
filed and of each amendment thereto (without exhibits). 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 will furnish to each Underwriter,
without charge, during the period when the Prospectus is required to be
delivered under the 1933 Act, 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.
(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 when a
prospectus is required by the 1933 Act to be delivered in connection with sales
of the Securities, any event shall occur or condition shall exist as a result of
which it is necessary, in the 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
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 its reasonable best
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 Underwriters may designate and to
maintain such qualifications in effect as long as may be required for the
distribution of the Securities; 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.
(g) Rule 158. The Company will file such reports pursuant to the 1934 Act
as are necessary in order to make generally available to its securityholders 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.
12
(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 Common Stock on the New York Stock Exchange.
(j) Restriction on Sale of Securities. During a period from the date hereof
until the Closing Time, the Company will not, without the prior written consent
of the Representative, (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. This clause (j) 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 or mandatory
exchange of a security (including a share of "phantom stock") outstanding on the
date hereof and referred to in the Prospectus, (C) any shares of Common Stock
issued, "phantom 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, (D) any shares of Common Stock issued pursuant to
any non-employee director stock plan or dividend reinvestment plan or (E)
securities issued as consideration pursuant to acquisitions and registration
statements registering resales of such securities.
(k) Reporting Requirements. The Company, during the period when the
Prospectus is required to be delivered under the 1933 Act, 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
preparation, printing and delivery to the Underwriters of this Agreement and
such other documents as may be required in connection with the offering,
purchase, sale, issuance or delivery of the Securities, (iii) 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, (iv) the fees and disbursements of the Company's counsel,
accountants and other advisors, (v) 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, (vi) the printing and
delivery to the Underwriters of copies of the Prospectus and any amendments or
supplements thereto, (vii) the
13
fees and expenses of any transfer agent or registrar for the Securities and
(viii) the fees and expenses incurred in connection with the listing of the
Securities on the New York Stock Exchange.
(b) Termination of Agreement. If this Agreement is terminated by the
Underwriters in accordance with the provisions of Section 5 or Section 9(a)(i)
hereof, the Company shall reimburse the Underwriters for all of their
out-of-pocket expenses, including the reasonable fees and disbursements of
counsel for the Underwriters.
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 contained in
Section 1 hereof or in certificates of any officer of the Company or any
subsidiary of the Company delivered pursuant to the provisions hereof, to the
performance by the Company 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 containing
the Rule 430A Information shall have been filed with the Commission in
accordance with Rule 424(b) (or a post-effective amendment providing such
information shall have been filed and declared effective in accordance with the
requirements of Rule 430A).
(b) Opinion of Counsel for Company. At Closing Time, the Underwriters shall
have received the favorable opinion, dated as of Closing Time, of Shearman &
Sterling 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 and to such further effect as counsel to the Underwriters may
reasonably request.
(c) Opinion of Counsel for Underwriters. [ ], counsel for the Underwriters,
shall have furnished to you such written opinion or opinions, dated as of
Closing Time, with respect to the validity of the Securities, the Registration
Statement, the Prospectus and such other related matters as you may reasonably
request, and such counsel shall have received such papers and information as
they may reasonably request to enable them to pass upon such matters.
(d) 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 Underwriters shall have
received a certificate of the President or a Vice President of the Company and
of the principal financial or chief accounting officer of the Company, dated as
of Closing Time, to the effect that
14
(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, to their
knowledge, contemplated by the Commission.
(e) Accountant's Comfort Letter. Substantially concurrently with the
execution and delivery hereof, the Underwriters shall have received from [ ] a
letter dated the date of this Purchase Agreement, in form and substance
satisfactory to the Underwriters and [ ], 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.
(f) Bring-down Comfort Letter. At Closing Time, the Underwriters shall have
received from [ ] a letter, dated as of Closing Time, to the effect that they
reaffirm the statements made in the letter furnished pursuant to subsection (e)
of this Section, except that the specified date referred to shall be a date not
more than five business days prior to Closing Time.
(g) 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.
(h) Maintenance of Rating. Since the execution of this Agreement, there
shall not have been any decrease in the rating of any of the Company's
securities by any "nationally recognized statistical rating organization" (as
defined for purposes of Rule 436(g) under the 0000 Xxx) or any notice given of
any intended or potential decrease in any such rating or of a possible change in
any such rating that does not indicate the direction of the possible change.
(i) 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 contained herein and the statements in any certificates furnished
by the Company or any subsidiary of the Company hereunder shall be true and
correct as of each Date of Delivery and, at the relevant Date of Delivery, the
Underwriters 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(d) hereof
remains true and correct as of such Date of Delivery.
(ii) Opinion of Counsel for Company. The favorable opinion of Shearman
& Sterling 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(b)
hereof.
15
(iii) Opinion of Counsel for Underwriters. The favorable opinion of
[name of underwriters counsel], 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(c) hereof.
(iv) Bring-down Comfort Letter. A letter from [name of accounting
firm], in form and substance satisfactory to the Underwriters and [name of
accounting firm] and dated such Date of Delivery, substantially in the same
form and substance as the letter furnished to the Underwriters pursuant to
Section 5(f) 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.
(j) 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 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 proceedings
taken by the Company in connection with the issuance and sale of the Securities
as herein contemplated shall be satisfactory in form and substance to the
Underwriters and counsel for the Underwriters.
(k) 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 Underwriters by notice to the Company 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. (1) The Company agrees to indemnify
and hold harmless each Underwriter, its affiliates, as such term is defined in
Rule 501(b) under the 1933 Act (each, an "Affiliate"), its selling agents 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 and expense
whatsoever, as incurred, arising out of any untrue statement or alleged
untrue statement of a material fact contained in the Registration Statement
(or any amendment thereto), including the Rule 430A Information, or the
omission or alleged omission therefrom of a material fact required to be
stated therein or necessary to make the statements therein not misleading
or arising out of any untrue statement or alleged untrue statement of a
material fact included in the Prospectus (or any amendment or supplement
thereto), or the omission or alleged omission therefrom of a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading;
16
(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 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;
(iii) against any and all expense whatsoever, as incurred (including
the fees and disbursements of counsel chosen by the Representative),
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 the Representative expressly for use
in the Registration Statement (or any amendment thereto), including the
Rule 430A Information or the Prospectus (or any amendment or supplement
thereto).
(2) Insofar as this indemnity agreement may permit indemnification for
liabilities under the 1933 Act of any person who is a partner of an Underwriter
or who controls an underwriter within the meaning of Section 15 of the 1933 Act
or Section 20 of the 1934 Act and who, at the date of this Agreement, is a
director or officer of the Company or controls the Company within the meaning of
Section 15 of the 1933 Act or Section 20 of the 1934 Act, such indemnity
agreement is subject to the undertaking of the Company in the Registration
Statement under Item 17 thereof.
(b) Indemnification of Company, Directors and Officers. 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 against any and all loss, liability, claim, damage
and expense described in the indemnity contained in subsection (a)(1) 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), including the Rule 430A Information, or any
preliminary prospectus 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 the Representative expressly for use
in the Registration Statement (or any amendment thereto) or the Prospectus (or
any amendment or supplement thereto).
(c) Actions against Parties; Notification. Each indemnified party shall
give notice as promptly as reasonably practicable to each indemnifying party of
any action commenced against
17
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 case any such
action is brought against any indemnified party, and it notifies the
indemnifying party of the commencement thereof, the indemnifying party will be
entitled to participate therein and, to the extent it may wish, jointly with any
other indemnifying party similarly notified, to assume the defense thereof, with
counsel satisfactory to such indemnified party; provided, however, that if the
defendants in any such action include both the indemnified party and the
indemnifying party and the indemnified party shall have reasonably concluded
that there may be one or more legal defenses available to it and/or other
indemnified parties which are different from or additional to those available to
the indemnifying party, the indemnifying party shall not have the right to
direct the defense of such action on behalf of such indemnified party or parties
and such indemnified party or parties shall have the right to select separate
counsel to defend such action on behalf of such indemnified party or parties.
After notice from the indemnifying party to such indemnified party of its
election so to assume the defense thereof and approval by such indemnified party
of counsel appointed to defend such action, the indemnifying party will not be
liable to such indemnified party under this Section 6(c) for any legal or other
expenses, other than reasonable costs of investigation, subsequently incurred by
such indemnified party in connection with the defense thereof, unless (i) the
indemnified party shall have employed separate counsel in accordance with the
proviso to the next preceding sentence (it being understood, however, that in
connection with such action the indemnifying party shall not be liable for the
expenses of more than one separate counsel (in addition to local counsel) in any
one action or separate but substantially similar actions in the same
jurisdiction arising out of the same general allegations or circumstances,
designated by the Representative in the case of paragraph (a) of this Section 6,
representing the indemnified parties under such paragraph (a) who are parties to
such action or actions) or (ii) the indemnifying party does not promptly retain
counsel satisfactory to the indemnified party or (iii) the indemnifying party
has authorized the employment of counsel for the indemnified party at the
expense of the indemnifying party. The indemnifying party will not be liable for
the costs and expenses of any settlement of such action effected by such
indemnified party without the consent of the indemnifying party. No indemnifying
party shall, without the prior written consent of the indemnified parties,
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.
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 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
18
incurred by such indemnified party, as incurred, (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company 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 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 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 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 Initial Securities as set forth on the cover of the
Prospectus.
The relative fault of the Company 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 by the Underwriters and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission.
The Company 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 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 and each Underwriter's
19
Affiliates and selling agents 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 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. 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 A hereto and not joint.
SECTION 8. Representations, Warranties and Agreements to Survive.
-----------------------------------------------------
All representations, warranties and agreements contained in
this Agreement or in certificates of officers of the Company or any of its
subsidiaries submitted pursuant hereto, shall remain operative and in full force
and effect regardless of (i) any investigation made by or on behalf of any
Underwriter or its Affiliates or selling agents, any person controlling any
Underwriter, its officers or directors or any person controlling the Company and
(ii) delivery of and payment for the Securities.
SECTION 9. Termination of Agreement.
------------------------
(a) Termination; General. The Underwriters may terminate this Agreement, by
notice to the Company, 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, 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 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, in each case the effect of which is
such as to make it, in the judgment of the Underwriters, 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 (iv) if a material disruption has
occurred in commercial banking or securities settlement or clearance services in
the United States or (v) 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.
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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 Underwriters
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
Underwriters shall not have completed such arrangements within such 24-hour
period, then:
(i) 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
(ii) 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 Underwriters or the Company 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. Notices.
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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 Representative at [ ], attention [ ]; and notices to the Company
shall be directed to it at Xxxx Xxxxx, Inc., 000 Xxxxx Xxxxxx, Xxxxxxxxx, XX
00000, attention General Counsel.
SECTION 12. Parties.
-------
This Agreement shall each inure to the benefit of and be
binding upon the Underwriters and the Company 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
21
than the Underwriters and the Company 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 and the Company 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 Securities from any
Underwriter shall be deemed to be a successor by reason merely of such purchase.
SECTION 13. GOVERNING LAW.
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THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
SECTION 14. TIME.
----
TIME SHALL BE OF THE ESSENCE OF THIS AGREEMENT. EXCEPT
AS OTHERWISE SET FORTH HEREIN, SPECIFIED TIMES OF DAY REFER TO NEW YORK
CITY TIME.
SECTION 15. Counterparts.
------------
This Agreement may be executed in any number of counterparts,
each of which shall be deemed to be an original, but all such counterparts shall
together constitute one and the same Agreement.
SECTION 16. Effect of Headings.
------------------
The Section headings herein are for convenience only and
shall not affect the construction hereof.
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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,
XXXX XXXXX, INC.
By
---------------------------------
Title:
CONFIRMED AND ACCEPTED,
as of the date first above written:
[underwriters]
By: [ ]
By
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Authorized Signatory
23
SCHEDULE A
Number of
Initial
Name of Underwriter Securities
------------------- ----------
[ ] [ ]
[ ] [ ]
[ ] [ ]
Total............................................................. [ ]
Sch A-1
SCHEDULE B
XXXX XXXXX, INC.
[ ] Shares of Common Stock
(Par Value $.10 Per Share)
1. The initial public offering price per share for the
Securities, determined as provided in said Section 2, shall be $[ ].
2. The purchase price per share for the Securities to be paid by
the several Underwriters shall be $[ ], being an amount equal to the initial
public offering price set forth above less $[ ] per share; provided that the
purchase price per share for any Option Securities purchased upon the exercise
of the overallotment 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 B-1
[SCHEDULE C]
Certain Subsidiaries
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State (Jurisdiction) of
Name of Subsidiary Incorporation or Organization
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C-1
