EXHIBIT 1.1
3,800,000 SHARES
U.S. CONCRETE, INC.
COMMON STOCK
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UNDERWRITING AGREEMENT
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XXXXX & XXXXXXXXXXXX, INC.
As Representative of the Several
Underwriters Named in Schedule I hereto
000 Xxxx Xxxx Xxxxxx
Xxxxxxxx, Xxxxxxxx 00000
[May ____], 1999
Dear Sirs:
U.S. Concrete, Inc., a Delaware corporation (the "Company"), proposes,
subject to the terms and conditions stated herein, to issue and sell to Xxxxx &
Xxxxxxxxxxxx, Inc. ("S&S" or the "Representative") and the several other
underwriters named in Schedule I hereto (collectively, with the Representative,
the "Underwriters") an aggregate of 3,800,000 shares (the "Firm Securities") of
Common Stock, $.001 par value per share, of the Company ("Common Stock") and, at
the election of the Underwriters, up to 570,000 additional shares (the "Optional
Securities") of Common Stock. The Firm Securities and the Optional Securities
that the Underwriters elect to purchase pursuant to Section 2, if any, hereof
are collectively called the "Securities."
Additionally, as a portion of the Underwriters' compensation, the Company
will, pursuant to the Warrant Agreement among the Company and S&S and Xxxxxxx
Xxxxxx Xxxxx Inc. ("SMM"), dated May , 1999 (the "Warrant Agreement"), grant to
S&S and SMM warrants (the "Warrants") to purchase an aggregate of 200,000 shares
of Common Stock at the price described in the Warrant Agreement. As described in
the Warrant Agreement, such warrants will be exercisable on or after
the first anniversary of the initial public offering of the Common Stock (the
"IPO") and on or prior to the third anniversary of the IPO.
1. REPRESENTATIONS AND WARRANTIES.
The Company represents and warrants to, and agrees with the several
Underwriters that:
(a) In connection with the transactions contemplated by this Underwriting
Agreement (the "Agreement"), a registration statement on Form S-1 (File No.
333-74855), and as a part thereof a preliminary prospectus, in respect of the
Securities has been prepared by the Company in conformity with the requirements
of the Securities Act of 1933, as amended (the "Act"), and has been filed with
the Securities and Exchange Commission (the "Commission") in the form heretofore
delivered to you; such registration statement, as amended, has been declared
effective by the Commission; and no stop order suspending the effectiveness of
such registration statement has been issued and no proceeding for that purpose
has been instituted or threatened by the Commission (any preliminary prospectus
included in such registration statement, as amended, or filed by the Company
with the Commission pursuant to Rule 424(a) under the Act in connection with the
offering of the Securities, being hereinafter called a "Preliminary Prospectus";
the various parts of such registration statement, including all exhibits thereto
and including the information contained in the form of final prospectus filed
with the Commission pursuant to Rule 424(b) under the Act in accordance with
Section 5(a) of this Agreement and deemed by virtue of Rule 430A under the Act
to be a part of the registration statement at the time it was declared
effective, each as amended at the time such part became effective, and any
registration statement filed pursuant to Rule 462(b) under the Act registering
additional shares of Common Stock which the Company has filed or is required to
file pursuant to the terms hereof being hereinafter called collectively the
"Registration Statement" and the final prospectus, in the form first filed by
the Company pursuant to Rule 424(b) under the Act, being hereinafter called the
"Prospectus");
(b) No order preventing or suspending the use of any Preliminary
Prospectus has been issued by the Commission, and each Preliminary Prospectus,
at the time of filing thereof, complied in all material respects with the
applicable requirements of the Act and the rules and regulations of the
Commission thereunder;
(c) The Registration Statement complies in all material respects with the
applicable requirements of the Act and the rules and regulations of the
Commission thereunder and did not, as of its effective date 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;
provided, however, that this representation and warranty shall not apply to any
statements in or omissions from the Registration Statement made in reliance upon
and in conformity with information furnished in writing to the Company by or on
behalf of any Underwriter through you expressly for use therein;
(d) The Prospectus, as amended or supplemented, as of its date and at all
subsequent times, did 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, in light of
the circumstances under which they were made, not misleading; provided, however,
that this representation and warranty does not apply to statements in or
omissions from the Prospectus, or any amendments or supplements thereto, made in
reliance upon and in conformity with information furnished in writing to the
Company by or on behalf of any Underwriter through you expressly for use
therein.
(e) Schedule II hereto lists (i) all the Company's subsidiaries as of the
date hereof (the "Subsidiaries") and (ii) all the companies the Company will
acquire (the "Founding Companies") on the First Delivery Date (as herein
defined) pursuant to the acquisition transactions the Registration Statement
describes (the "Acquisitions"). None of the Company, the Subsidiaries and the
Founding Companies has sustained since the date of the latest audited financial
statements included in the Prospectus any material 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 expressly contemplated in the
Prospectus, except for any such loss or interference that would not, singly or
in the aggregate, have a material adverse effect on the business, properties,
financial condition or results of operations of the Company, the Subsidiaries
and the Founding Companies, taken as a whole (a "Material Adverse Effect");
(f) Since the respective dates as of which information is given in the
Registration Statement and the Prospectus, except as otherwise set forth or
expressly contemplated therein, (i) there has not been any change in the capital
stock or increase in the long term debt of the Company, the Subsidiaries or the
Founding Companies, respectively, or any material adverse change, or any
development involving a prospective material adverse change, in or affecting the
general affairs, management, financial position, stockholders' equity or results
of operations of the Company, the Subsidiaries and the Founding Companies taken
as a whole and (ii) there have been no transactions entered into by the Company
, the Subsidiaries or the Founding Companies, other than transactions entered
into in the ordinary course of business, that are material with respect to the
Company, the Subsidiaries and the Founding Companies taken as a whole;
(g) The Company, the Subsidiaries and the Founding Companies have good and
indefeasible title to all real property and good and marketable title to all
personal property reflected as owned by them, respectively, in the financial
statements referred to in Section 1(t) below (or elsewhere in the Prospectus),
in each case free and clear of all liens, encumbrances and defects except such
as are described in the Prospectus or such as do not materially and adversely
affect the value of such property and do not materially interfere with the use
made and proposed to be made of such property by the Company, the Subsidiaries
and the Founding Companies; and any real property and buildings reflected as
being held under lease by the Company, the Subsidiaries and the Founding
Companies, respectively, in the financial statements referred to in Section 1(t)
below (or elsewhere in the Prospectus) are held by them under valid, subsisting
and enforceable leases with such exceptions as are not material and do not
materially interfere with the use made and proposed to be made of such property
and buildings by the Company, the Subsidiaries and the Founding Companies;
(h) The Company, the Subsidiaries and the Founding Companies have been
duly incorporated and are validly existing as corporations in good standing
under the laws of their respective jurisdictions of incorporation, with the
requisite corporate power and authority to own or lease their respective
properties and conduct their respective businesses as described in the
Prospectus; and each has been duly qualified as a foreign corporation for the
transaction of business and is in good standing under the laws of each other
jurisdiction in which it owns or leases properties, or conducts any business, so
as to require such qualification, except where the failure to so qualify would
not result in a Material Adverse Effect; and each of the Company, the
Subsidiaries and the Founding Companies holds all material licenses,
certificates, authorizations and permits from governmental authorities necessary
for the conduct of its business as described in the Prospectus;
(i) The Company has an authorized capitalization as set forth in the
Prospectus; all of the issued and outstanding shares of capital stock of the
Company have been duly and validly authorized and issued, are fully paid and
nonassessable and conform in all material respects to the description of the
capital stock of the Company contained in the Prospectus; except as described in
the Prospectus there are no preemptive or other rights to subscribe for or to
purchase any securities of the Company under the Certificate of Incorporation of
the Company or under Delaware law; except as described in the Prospectus, there
are no warrants, options or other rights to purchase any securities of the
Company which have been granted by the Company; and neither the filing of the
Registration Statement nor the offering or sale of the Securities as
contemplated by this Agreement gives rise to any rights for or relating to the
registration of any securities of the Company;
(j) All outstanding shares of capital stock of the Subsidiaries are duly
authorized and validly issued and are fully paid and non-assessable and, except
as described in the Prospectus, are owned, directly or indirectly, by the
Company free and clear of any perfected security interest and any other security
interests, claims, liens or encumbrances; as of the First Delivery Date, the
Company will own, directly or indirectly, all the issued and outstanding shares
of capital stock of the Founding Companies, free and clear of any security
interests, claims, liens or encumbrances (except for those that are described in
the Prospectus), and all those shares will have been validly issued and will be
fully paid and nonassessable; and, other than the Subsidiaries and the Founding
Companies, the Company does not own or control, directly or indirectly, any
corporation, association or other entity;
(k) The Securities have been duly authorized for issuance and sale
pursuant to this Agreement and, when issued and delivered by the Company against
payment therefor as provided herein, will be validly issued, fully paid and
nonassessable and will conform in all material respects to the description of
the Securities contained in the Prospectus;
(l) The issuance and sale of the Securities being issued at each Delivery
Date (as hereinafter defined) by the Company and the performance of this
Agreement and the consummation by the Company of the other transactions herein
contemplated will not conflict with or result in a breach or violation of any of
the terms or provisions of, or constitute a default under, or result in the
creation or imposition of any lien, charge or encumbrance upon any property or
assets of the Company or the Subsidiaries pursuant to, any indenture, mortgage,
deed of trust, loan agreement or
other agreement or instrument to which the Company or any of the Subsidiaries or
the Founding Companies is a party or by which the Company or any of the
Subsidiaries or the Founding Companies is bound or to which any of the property
or assets of the Company or any of the Subsidiaries or the Founding Companies is
subject, nor will such action result in any violation of the provisions of the
Certificate or Articles of Incorporation or Bylaws of the Company or any of the
Subsidiaries or the Founding Companies or any statute or any order, rule or
regulation of any court or governmental agency or body having jurisdiction over
the Company or any of the Subsidiaries or the Founding Companies or any of their
respective properties, except for any such conflicts, breaches, violations,
defaults, liens, charges or encumbrances as would not, singly or in the
aggregate, result in a Material Adverse Effect; and no consent, approval,
authorization, order, registration or qualification of or with any such court or
governmental agency or body is required for the issuance and sale of the
Securities or the consummation by the Company of the transactions contemplated
by this Agreement, except for (i) such consents, approvals, authorizations,
orders, registrations or qualifications as may be required under the Act and the
rules and regulations thereunder, the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), and the rules and regulations thereunder under
state securities or Blue Sky laws, and under the rules of the National
Association of Securities Dealers, Inc. (the "NASD") in connection with the
purchase and distribution of the Securities by the Underwriters and (ii) such
consents, approvals, authorizations, orders, registrations or qualifications as
to which the failure to obtain would not, singly or in the aggregate, result in
a Material Adverse Effect;
(m) None of the Company, the Subsidiaries and the Founding Companies is in
violation of its respective charter or by-laws or in default in the performance
of any obligation, agreement, covenant or condition contained in any indenture,
loan agreement, mortgage, lease or other agreement or instrument that is
material to the Company and the Subsidiaries, taken as a whole, to which the
Company or any of the subsidiaries is a party or by which the Company or any of
the Subsidiaries or their respective property is bound, except for such defaults
as would not, singly or in the aggregate, result in a Material Adverse Effect;
(n) There are no legal or governmental proceedings pending to which the
Company or any of the Subsidiaries or the Founding Companies is a party or of
which any of their respective property or assets is subject, which, if
determined adversely to the Company or the Subsidiaries, would individually or
in the aggregate, have a Material Adverse Effect and to the best of the
Company's knowledge, no such proceedings are threatened or contemplated by
governmental authorities or by others;
(o) None of the Company, the Subsidiaries and the Founding Companies has
violated any foreign, federal, state or local law or regulation relating to the
protection of human health and safety, the environment or hazardous or toxic
substances or wastes, pollutants or contaminants ("Environmental Laws"), except
for such violations that would not, singly or in the aggregate, have a Material
Adverse Effect;
(p) Each of the Company, the Subsidiaries and the Founding Companies has
such permits, licenses, consents, exemptions, franchises, authorizations and
other approvals (each an
"Authorization") of, and has made all filings with and notices to, all
governmental or regulatory authorities and self-regulatory organizations and all
courts and other tribunals, including, without limitation, under any applicable
Environmental Laws, as are necessary to own, lease, license and operate its
respective properties and to conduct its business, except where the failure to
have any such Authorization or to make any such filing or notice would not,
singly or in the aggregate, have a Material Adverse Effect (each such
Authorization being a "Material Authorization"). Each Material Authorization is
valid and in full force and effect and each of the Company, the Subsidiaries and
the Founding Companies is in compliance, in all material respects, with all the
terms and conditions thereof and with the applicable rules and regulations of
the authorities and governing bodies having jurisdiction with respect thereto;
and no event has occurred (including, without limitation, the receipt of any
notice from any authority or governing body) which allows or, after notice or
lapse of time or both, would allow revocation, suspension or termination of any
such Material Authorization or results or, after notice or lapse of time or
both, would result in any other impairment of the rights of the holder of any
such Material Authorization; and none of the Authorizations contain restrictions
that are burdensome, in any material respect, to the Company, any of the
Subsidiaries or the Founding Companies;
(q) There are no costs or liabilities associated with Environmental Laws
(including, without limitation, any capital or operating expenditures required
for clean-up, closure of properties or compliance with Environmental Laws or any
Authorization, any related constraints on operating activities and any potential
liabilities to third parties) which would, singly or in the aggregate, have a
Material Adverse Effect;
(r) Xxxxxx Xxxxxxxx, LLP, which has certified certain financial statements
of the Company and the Founding Companies, are independent public accountants
within the meaning of the Act and the rules and regulations of the Commission
thereunder;
(s) All employee benefit plans established, maintained or contributed to
by the Company or any of the Subsidiaries or Founding Companies comply in all
material respects with all applicable requirements of the Employee Retirement
Income Security Act of 1974, as amended ("ERISA"), and no such plan has incurred
or assumed an "accumulated funding deficiency" within the meaning of Section 302
of ERISA or has incurred or assumed any material liability to the Pension
Benefit Guaranty Corporation;
(t) The historical financial statements of the Company and the Founding
Companies, together with related notes, as set forth in the Registration
Statement and Prospectus (and any supplement or amendment thereto) present
fairly in all material respects the financial position and the results of
operations of the Company and the Founding Companies at the indicated dates and
for the indicated periods, all in accordance with generally accepted accounting
principles, consistently applied throughout the periods presented except as
noted in such financial statements and the notes thereto; and the selected
financial information included in the Prospectus presents fairly the information
shown therein and has been compiled on a basis consistent with the financial
statements presented therein; and the other historical financial and statistical
information and data respecting the Company and the Founding Companies set forth
in the Registration Statement and the Prospectus
(and any amendment and supplement thereto) are, in all material respects,
accurately presented and prepared on a basis consistent with such financial
statements and the books and records of the Company and the Founding Companies,
as applicable. The PRO FORMA combined financial statements of the Company and
the Founding Companies and the related notes thereto set forth in the
Registration Statement and the Prospectus (and any supplement or amendment
thereto) have been prepared in accordance with the applicable requirements of
Rule 11-02 of Regulation S-X promulgated by the Commission and have been
properly compiled on the pro forma bases described therein and the assumptions
used in the preparation thereof are reasonable and the adjustments used therein
are appropriate to give effect to the transactions or circumstances referred to
therein. The other PRO FORMA financial and statistical information and data set
forth in the Registration Statement and the Prospectus (and any supplement or
amendment thereto) are, in all material respects, accurately presented and
prepared on a basis consistent with the PRO FORMA financial statements. No other
financial statements or supporting schedules, other than the Financial Data
Schedule required by Item 601(c) of Regulation S-K under the Securities Act, are
required to be included in the Registration Statement. As of the date of the
Prospectus, neither the Company nor any of the Subsidiaries or the Founding
Companies is engaged in substantive discussions with any third party with
respect to, or obligated to complete, any acquisitions (other than the
Acquisitions) for which disclosure of PRO FORMA financial information in the
Prospectus is required by the Act;
(u) 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" as such term is defined in
the Investment Company Act of 1940, as amended;
(v) Except as disclosed 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 Act with respect to any securities of the Company or to require the Company
to include such securities with the Securities registered pursuant to the
Registration Statement;
(w) The Company, the Subsidiaries and the Founding Companies have filed
all federal, state, local and foreign income and franchise tax returns that have
been required to be filed (or have properly requested extensions with respect
thereto) other than those filings being contested in good faith, and have paid,
or made adequate reserves for, all taxes indicated by said returns and all
assessments received by them to the extent that such taxes have become due and
are not being contested in good faith, except where the failure to do so would
not, singly or in the aggregate, result in a Material Adverse Effect.
(x) Each certificate signed by any officer of the Company and delivered to
the Underwriters or counsel for the Underwriters on any Delivery Date shall be
deemed to be a representation and warranty by the Company to the Underwriters as
to the matters covered thereby;
(y) The Company and the Founding Companies 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; and neither the Company nor any of the
Subsidiaries (i) has received notice from any insurer or agent of such insurer
that substantial capital improvements or other material expenditures will have
to be made in order to continue such insurance or (ii) has any reason to believe
that it will not be able to renew its existing insurance coverage as and when
such coverage expires or to obtain similar coverage from similar insurers at a
cost that would not have a Material Adverse Effect;
(z) There is no (i) significant unfair labor practice complaint, grievance
or arbitration proceeding pending or threatened against the Company or any of
the Subsidiaries or Founding Companies before the National Labor Relations Board
or any state or local labor relations board, (ii) strike, labor dispute,
slowdown or stoppage pending or threatened against the Company or any of the
Subsidiaries or (iii) union representation question existing with respect to the
employees of the Company or any of the Subsidiaries or Founding Companies,
except for such actions specified in clause (i), (ii) or (iii) above, which,
singly or in the aggregate, would not have a Material Adverse Effect.
(aa) The Company maintains a system of internal accounting controls
sufficient to provide reasonable assurance that (i) its transactions and those
of its subsidiaries are executed in accordance with management's general or
specific authorizations; (ii) its transactions and those of its subsidiaries are
recorded as necessary to permit preparation of financial statements in
conformity with generally accepted accounting principles and to maintain
accountability for assets; (iii) access to its assets and those of its
subsidiaries is permitted only in accordance with management's general or
specific authorization; and (iv) the recorded accountability for its assets and
those of its subsidiaries is compared with the existing assets at reasonable
intervals and appropriate action is taken with respect to any differences;
(bb) No relationship, direct or indirect, exists between or among the
Company or any of the Subsidiaries or Founding Companies, on the one hand, and
the directors, officers, shareholders, customers or suppliers of the Company or
any of the Subsidiaries or Founding Companies, on the other hand, that is
required by the Act or by the rules and regulations thereunder to be described
in the Registration Statement and the Prospectus which is not so described;
(cc) None of the Company, the Subsidiaries or the Founding Companies have
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;
(dd) This Agreement has been duly authorized, executed and delivered by
the Company and constitutes a valid and binding agreement of the Company,
enforceable against the Company in accordance with its terms, except as that
enforceability may be subject to the effect of (i) any applicable bankruptcy,
fraudulent conveyance, insolvency, reorganization, moratorium or other laws
affecting creditors' rights generally, (ii) general principles of equity
(regardless of whether that enforceability is considered in a proceeding in
equity or at law) and (iii) any implied covenant of good faith or fair dealing,
and except as rights to indemnity and contribution hereunder may be limited by
federal or state law;
(ee) The execution and delivery of, and the performance by the Company,
the Founding Companies and the shareholders of each Founding Company of their
respective obligations under, the agreements relating to the Acquisitions,
included as exhibits to the Registration Statement (the "Acquisition
Agreements") to which they are parties, respectively, have been duly and validly
authorized by the Company, the Founding Companies and the shareholders of each
Founding Company and each Acquisition Agreement has been duly executed and
delivered by the Company and each Founding Company and Founding Company
shareholder which is a party to such agreement, and constitutes the legal, valid
and binding agreement of the Company and each such Founding Company and Founding
Company shareholder, enforceable in accordance with its terms, except as that
enforceability may be subject to the effect of (i) any applicable bankruptcy,
fraudulent conveyance, insolvency, reorganization, moratorium or other laws
affecting creditors' rights generally, (ii) general principles or equity
(regardless of whether that enforceability is considered in a proceeding in
equity or at law) and (iii) any implied covenant of good faith or fair dealing,
and except as rights to indemnity and contribution thereunder may be limited by
applicable law; and
(ff) The Securities have been approved for inclusion on the Nasdaq
National Market, subject to notice of issuance and compliance with certain
requirements of The Nasdaq Stock Market, Inc.
2. PURCHASE AND SALE OF THE SECURITIES.
Subject to the terms and conditions herein set forth, (a) the Company
agrees to sell to the Underwriters, and each of the Underwriters agrees,
severally and not jointly, to purchase from the Company, at a purchase price per
share of [$ ], the number of Firm Securities (to be adjusted by you so as to
eliminate fractional shares) determined by multiplying the aggregate number of
Firm Securities to be sold by the Company by a fraction, the numerator of which
is the aggregate number of Firm Securities to be purchased by such Underwriter
as set forth opposite the name of such Underwriter in Schedule I hereto, and the
denominator of which is the aggregate number of Firm Securities to be purchased
by all the Underwriters from the Company as set forth in Schedule I hereto and
(b) in the event and to the extent that the Underwriters shall exercise the
election to purchase Optional Securities as provided below, the Company agrees
to sell to the Underwriters, and each of the Underwriters agrees, severally and
not jointly, to purchase from the Company, at the same purchase price set forth
in clause (a) of this Section 2, that portion of the number of Optional
Securities as to which such election shall have been exercised (to be adjusted
by you so as to eliminate fractional shares) determined by multiplying such
number of Optional Securities by a fraction, the numerator of which is the
aggregate number of Firm Securities to be purchased by such Underwriter as set
forth opposite the name of such Underwriter in Schedule I hereto, and the
denominator of which is the aggregate number of Firm Securities to be purchased
by all the Underwriters from the Company as set forth in Schedule I hereto.
The Company grants the Underwriters the right to purchase at their
election up to 570,000 Optional Securities, at the purchase price per share set
forth in the preceding paragraph, for the sole purpose of covering
overallotments, in the sale of the Firm Securities. Any such election to
purchase the Optional Securities may be exercised no more than once by written
notice from you to the
Company, given within a period of 30 days after the date of this Agreement,
setting forth the aggregate amount of the Optional Securities to be purchased
and the date on which such Optional Securities are to be delivered, as
determined by you but in no event earlier than the First Delivery Date (as
defined in Section 4 hereof) or, unless you otherwise agree in writing, earlier
than two or later than seven business days after the date of such notice.
The Company hereby agrees not to offer, pledge, sell, contract to sell,
sell any option to purchase, grant any option, right or warrant to purchase, or
otherwise transfer or dispose of, directly or indirectly, any shares of Common
Stock or any securities convertible into or exercisable or exchangeable for
Common Stock except to the Underwriters pursuant to this Agreement and to
stockholders of the Founding Companies pursuant to the Acquisition Agreements,
for a period of 180 days after the date of the Prospectus without the prior
written consent of Xxxxx & Xxxxxxxxxxxx, Inc. During such period (i) the Company
may issue shares of Common Stock in connection with acquisitions after the
thirtieth day following the date of the Prospectus, (ii) the Company may grant
stock options and issue shares of Common Stock on the exercise of stock options
pursuant to the company's existing incentive plan and (iii) the Company may
issue shares of Common Stock upon the exercise of any option or warrant or the
conversion of any convertible security outstanding on the date hereof. The
Company also agrees not to amend the provisions of Section 10.14(a) of each of
the Acquisition Agreements, or to waive the provisions thereof or give its
consent thereunder, for a period of 180 days after the date of the Prospectus
without the prior written consent of Xxxxx & Xxxxxxxxxxxx, Inc. Notwithstanding
the foregoing, during such period the Company may register 3,000,000 shares of
Common Stock under the Act for use by the Company in future acquisitions. The
Company shall, prior to or concurrently with the execution of this Agreement,
deliver an agreement executed by (i) each of the directors and officers of the
Company and (ii) each stockholder listed on Annex II hereto to the effect that
such person will not, during the period commencing on the date such person signs
such agreement and ending 180 days after the date of the Prospectus, without the
prior written consent of Xxxxx & Xxxxxxxxxxxx, Inc., (A) engage in any of the
transactions described in the first sentence of this paragraph or (B) make any
demand for, or exercise any right with respect to, the registration of any
shares of Common Stock or any securities convertible into or exercisable for
Common Stock.
3. OFFERING BY THE UNDERWRITERS.
Upon authorization by you of the release of the Firm Securities, the
Underwriters propose to offer the Firm Securities for sale upon the terms and
conditions set forth in the Prospectus.
4. DELIVERY AND PAYMENT.
Certificates in definitive form for the Securities to be purchased by each
Underwriter hereunder, and in such denominations and registered in such names as
you may request upon at least two business days' prior notice to the Company,
shall be delivered by or on behalf of the Company to you for the account of each
Underwriter, against payment of the purchase price therefor by wire transfer in
immediately available funds, all at the offices of Xxxxx & Xxxxx L.L.P., 0000
Xxx Xxxxx Xxxxx, Xxxxxxx, Xxxxx (or such other place as may be agreed to by the
Company and the
Representatives). The time and date of such delivery and payment shall be, with
respect to the Firm Securities, 8:00 a.m., Houston time, on _________, 1999, or
at such other time and date as you and the Company may agree upon in writing
and, with respect to the Optional Securities, 8:00 a.m., Houston time, on the
date specified by you in the written notice of the Underwriters' election to
purchase such Optional Securities in accordance with the provisions of Section
2, or at such other time and date as you and the Company may agree upon in
writing. Such time and date for delivery of the Firm Securities is herein called
the "First Delivery Date," such time and date for delivery of the Optional
Securities, if not the First Delivery Date, is herein called the "Second
Delivery Date," and each such time and date for delivery is herein called a
"Delivery Date." Such certificates will be made available to the Underwriters
for checking and packaging at least twenty-four hours prior to each Delivery
Date at the offices of Xxxxx & Xxxxxxxxxxxx, Inc. in Richmond, Virginia or such
other location designated by the Underwriters to the Company.
5. AGREEMENTS OF THE COMPANY.
The Company agrees with the Underwriters:
(a) To prepare the Prospectus in a form reasonably approved by you and to
file such Prospectus pursuant to Rule 424(b) under the Act within the time
period prescribed or, if applicable, such earlier time as may be required by
Rule 430A under the Act; to make no amendment or supplement to the Registration
Statement or Prospectus which shall be reasonably disapproved by you promptly
after reasonable notice thereof; to advise you, promptly after it receives
notice thereof, of the time when any amendment to the Registration Statement has
been filed or becomes effective or any supplement to the Prospectus or any
amended Prospectus has been filed and to furnish you with copies thereof; to
advise you, promptly after it receives notice thereof, if the Company is
required to file a Rule 462(b) Registration Statement after the effectiveness of
this Agreement, when the Rule 462(b) Registration Statement has become
effective; to file promptly all reports and any definitive proxy or information
statements required to be filed by the Company with the Commission subsequent to
the date of the Prospectus and for so long as the delivery of a prospectus is
required in connection with the offering or sale of the Securities; to advise
you, promptly after it receives notice thereof, of the issuance by the
Commission of any stop order or of any order preventing or suspending the use of
any Preliminary Prospectus or the Prospectus, of the suspension of the
qualification of the Securities for offering or sale in any jurisdiction, of the
initiation or threatening of any proceeding for any such purpose, or of any
request by the Commission for the amending or supplementing of the Registration
Statement or Prospectus or for additional information; and, in the event of the
issuance of any stop order or of any order preventing or suspending the use of
any Preliminary Prospectus or the Prospectus or suspending any such
qualification, to use promptly its best efforts to obtain its withdrawal;
(b) Promptly from time to time to take such actions as you may reasonably
request to qualify the Securities for offering and sale under the securities
laws of such jurisdictions as you have requested and to comply with such laws so
as to permit the continuance of sales and dealings therein in such jurisdictions
for as long as may be necessary to complete the distribution of the Securities,
provided that in connection therewith the Company shall not be required to
qualify as a foreign
corporation or to take any action that would subject it to general service of
process in any such jurisdiction where it is not presently qualified or where it
would be subject to taxation as a foreign corporation.
(c) To furnish the Underwriters with copies of the Registration Statement
and the Prospectus in such quantities as you may from time to time reasonably
request during such period following the date hereof as a prospectus is required
to be delivered in connection with offers or sales of Securities, and, if the
delivery of a prospectus is required and if at such time any event shall have
occurred as a result of which the Prospectus as then amended or supplemented
would include an untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made when such Prospectus is delivered,
not misleading, or, if for any other reason it shall be necessary during such
period to amend or supplement the Prospectus in order to comply with the Act, to
prepare and file with the Commission an appropriate amendment or supplement to
the Prospectus so that the statements in the Prospectus, as so amended or
supplemented, will not in the light of the circumstances when it is so
delivered, be misleading, or so that the Prospectus will comply with applicable
law, and to notify you and upon your request furnish without charge to each
Underwriter and to any dealer in securities as many copies as you may from time
to time reasonably request of such amended Prospectus or supplement to the
Prospectus;
(d) As soon as practicable, but not later than the Availability Date (as
defined below), to make generally available to its security holders and deliver
to you an earnings statement of the Company (which need not be audited) covering
a period of at least 12 months beginning after the effective date of the
Registration Statement which will satisfy the provisions of Section 11(a) of the
Act (for the purpose of this subsection 5(d) only, "Availability Date" means the
45th day after the end of the fourth fiscal quarter following the fiscal quarter
that includes the effective date of the Registration Statement, except that, if
such fourth fiscal quarter is the last quarter of the Company's fiscal year,
"Availability Date" means the 90th day after the end of such fourth fiscal
quarter);
(e) During a period of three years from the effective date of the
Registration Statement, to furnish to you copies of all reports or other
communications (financial or other) furnished to shareholders, and deliver to
you as soon as they are available, copies of any reports and financial
statements furnished to or filed with the Commission or any national securities
exchange on which any class of securities of the Company is listed or the Nasdaq
National Market; and (ii) such additional information concerning the business
and financial condition of the Company as you may from time to time reasonably
request;
(f) To apply the net proceeds from the sale of the Securities for the
purposes set forth in the Prospectus;
(g) To use its best efforts to list, subject to notice of issuance, the
Securities on the Nasdaq National Market and to maintain the listing of the
Securities on the Nasdaq National Market for a period of three years after the
date of this Agreement;
(h) To use its best efforts to do and perform all things required or
necessary to be done and performed under this Agreement by the Company prior to
each Delivery Date, and to satisfy all conditions precedent to the delivery of
the Securities; and
(i) If the Registration Statement at the time of the effectiveness of this
Agreement does not cover all the Securities, to file a Rule 462(b) Registration
Statement with the Commission registering the Securities not so covered in
compliance with Rule 462(b) by the date of this Agreement and to pay to the
Commission the filing fee for such Rule 462(b) Registration Statement at the
time of the filing thereof or to give irrevocable instructions for the payment
of such fee pursuant to Rule 111(b) under the Act.
6. PAYMENT OF EXPENSES.
The Company agrees with the several Underwriters that the Company will pay
or cause to be paid the following, whether or not the transactions contemplated
hereunder are consummated or this Agreement is terminated: (i) the fees,
disbursements and expenses of the Company's counsel and accountants in
connection with the registration of the Securities under the Act and all other
expenses in connection with the preparation, printing and filing of the
Registration Statement, any Preliminary Prospectus and the Prospectus and
amendments and supplements thereto and the mailing and delivering of copies
thereof to the Underwriters and dealers; (ii) the cost of printing or
reproducing this Agreement and any other documents in connection with the
offering, purchase, sale and delivery of the Securities; (iii) all expenses in
connection with the qualification, if required, of the Securities for offering
and sale under state securities laws as provided in Section 5(b) hereof,
including the reasonable fees and disbursements of counsel for the Underwriter
in connection with any such required qualification; (iv) the filing fees
incident to securing any required review by the NASD of the terms of the sale of
the Securities; (v) the cost of preparing stock certificates; (vi) the costs or
expenses of any transfer agent or registrar with respect to the Securities;
(vii) all fees relating to the inclusion of the Securities on the Nasdaq
National Market; and (viii) all other costs and expenses incident to the
performance of the Company's obligations hereunder which are not otherwise
specifically provided for in this Section. It is understood, however, that
except as provided in this Section, Section 8 and Section 11 hereof, the
Underwriters will pay all of their own costs and expenses, including the fees of
their counsel, stock transfer taxes on resale of any of the Securities by them,
and any advertising expenses connected with any offers they may make.
7. CONDITIONS TO OBLIGATIONS OF THE UNDERWRITERS.
The obligations of each Underwriter hereunder, as to the Securities to be
delivered at each Delivery Date, shall be subject, in its discretion, to the
condition that all representations and warranties and other statements of the
Company are, at and as of the date hereof and each Delivery Date, true and
correct in all material respects and the condition that the Company shall have
performed in all material respects all of its obligations hereunder theretofore
to be performed, and the following additional conditions:
(a) The Registration Statement is effective; if the filing of the
Prospectus, or any supplement thereto, is required pursuant to Rule 424(b), the
Prospectus, or any such supplement, will be filed in the manner and within the
time period required by Rule 424(b); no stop order suspending the effectiveness
of the Registration Statement shall be in effect and no proceeding for that
purpose shall be pending before or threatened by the Commission; and all
requests for additional information on the part of the Commission shall have
been complied with to your reasonable satisfaction;
(b) If the Company is required to file a Rule 462(b) Registration
Statement after the effectiveness of this Agreement, such Rule 462(b)
Registration Statement shall have become effective by the date of this
Agreement; and no stop order suspending the effectiveness of such Rule 462(b)
Registration Statement shall be in effect and no proceedings for that purpose
shall be pending before or threatened by the Commission;
(c) On each Delivery Date, Xxxxxxx & Xxxxx L.L.P., counsel for the
Underwriters, shall have furnished to you their written opinion, dated such
date, with respect to the incorporation of the Company, the validity of the
Securities being issued on such Delivery Date, the Registration Statement, the
Prospectus, and 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) On each Delivery Date, counsel for the Company shall have furnished to
you their written opinion, dated such date, substantially in the form attached
hereto as Annex I;
(e) On each Delivery Date, counsel for the Founding Companies shall have
furnished to you their written opinion, dated such date, substantially in the
form provided for by the Acquisition Agreements;
(f) On the date of this Agreement and also at each Delivery Date, Xxxxxx
Xxxxxxxx, LLP shall have furnished to you a letter in each case, dated the date
of delivery thereof, in form and substance reasonably satisfactory to you, to
the effect set forth in Annex II hereto;
(g) (i) Neither the Company nor the Subsidiaries shall have sustained
since the date of the latest audited financial statements included in the
Prospectus, any material 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 expressly contemplated in the Prospectus, except for any
such loss or interference that would not, singly or in the aggregate, result in
a Material Adverse Effect, and (ii) since the respective dates as of which
information is given in the Prospectus there shall not have been any change in
the capital stock or increase in the long-term debt of the Company, the
Subsidiaries or the Founding Companies or any material adverse change, or any
development involving a prospective material adverse change, in or affecting the
general affairs, management, financial position, stockholders' equity or results
of operations of the Company, the Subsidiaries and the Founding Companies taken
as a whole, 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 in your
reasonable judgment so material and adverse as to make it
impracticable or inadvisable to proceed with the public offering or the delivery
of the Securities being issued at such Delivery Date on the terms and in the
manner contemplated by the Prospectus;
(h) The Company shall have furnished or caused to be furnished to you the
agreements provided for in the last sentence of Section 2 herein.
(i) The Company shall have furnished or caused to be furnished to you on
the date of this Agreement and on the Delivery Date certificates of officers of
the Company satisfactory to you as to the accuracy of the representations and
warranties of the Company herein at and as of the date hereof and the Delivery
Date, as to the performance by the Company of all of its obligations hereunder
to be performed at or prior to the Delivery Date, as to the matters set forth in
subsections (a) and (f) of this Section and as to such other matters as you may
reasonably request;
(j) On the First Delivery Date, the Acquisitions shall have been
consummated on the terms set forth in the Registration Statement and the
Acquisition Agreements, without waiver or modification of any material terms or
provisions of any Acquisition Agreement, except as may be approved by you;
(k) The Securities shall have been duly approved for inclusion on the
Nasdaq National Market, subject to notice of issuance; and
(l) The Company shall have entered into employment agreements (in form and
substance satisfactory to you) with each of Xxxxxx X. Xxxxxxxxx and Xxxxxxx X.
Xxxxxx.
8. INDEMNIFICATION AND CONTRIBUTION.
(a) The Company will indemnify and hold harmless each Underwriter, its
directors, its officers and each person, if any, who controls any Underwriter
within the meaning of Section 15 of the Act or Section 20 of the Exchange Act
against any losses, claims, damages or liabilities, joint or several, to which
such Underwriter may become subject, under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon (i) any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement or any omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading or (ii) any untrue
statement or alleged untrue statement of a material fact contained in any
Preliminary Prospectus or the Prospectus (or any amendment or supplement
thereto), or any omission or alleged omission to state therein a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading, and will reimburse
each Underwriter for any legal or other expenses reasonably incurred by it in
connection with investigating, preparing to defend or defending, or appearing as
a third party witness in connection with, any such action or claim as such
expenses are incurred; provided, however, that the Company shall not be liable
in any such case to the extent that any such loss, claim, damage or liability
arises out of or is based upon an untrue statement or alleged untrue statement
or omission or alleged omission made in any Preliminary Prospectus, the
Registration Statement or the Prospectus or any amendment or
supplement thereto in reliance upon and in conformity with written information
furnished to the Company by you expressly for use therein; 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, claim, damage or liability purchased Securities, or any
person controlling such Underwriter, if copies of the Prospectus were timely
delivered to the Underwriter pursuant to Section 5 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, and if the Prospectus (as so amended or
supplemented) would have cured the defect giving rise to such loss, claim,
damage, liability or expense.
(b) Each Underwriter will indemnify and hold harmless the Company, each of
its directors and officers who signed the Registration Statement and each
person, if any, who controls the Company within the meaning of Section 15 of the
Act or Section 20 of the Exchange Act against any losses, claims, damages or
liabilities, joint or several, to which the Company or any such director,
officer or controlling person may become subject, under the Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon any untrue statement or alleged untrue
statement of a material fact contained in any Preliminary Prospectus, the
Registration Statement or the Prospectus, or any amendment or supplement, or
arise out of or are based upon the omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make the
statements therein not misleading, in each case to the extent, but only to the
extent, that such untrue statement or alleged untrue statement or omission or
alleged omission was made in any Preliminary Prospectus, Registration Statement
or Prospectus or any such amendment or supplement thereto in reliance upon and
in conformity with written information furnished to the Company by such
Underwriter through you expressly for use therein; and will reimburse the
Company for any legal or other expenses reasonably incurred by the Company in
connection with investigating, preparing to defend or defending, or appearing as
a third party witness in connection with, any such action or claim as such
expenses are incurred. The Company acknowledges that for purposes of this
Agreement the last sentence on the front cover page of the Prospectus and the
statements set forth in the first through fourth paragraphs, the tenth paragraph
(regarding sales to accounts over which the representatives of the Underwriters
exercise discretionary authority) and fourteenth through sixteenth paragraphs in
the Preliminary Prospectus and the Prospectus under the heading "Underwriting"
constitute the only information furnished in writing by or on behalf of the
several Underwriters for inclusion in the Preliminary Prospectus or the
Prospectus, and you confirm, as the Representative, that such statements are
correct.
(c) Promptly after receipt by an indemnified party under subsection (a) or
(b) above of notice of the commencement of any action, such indemnified party
shall, if a claim in respect thereof is to be made against an indemnifying party
under such subsection, notify the indemnifying party in writing of the
commencement thereof; but the omission so to notify the indemnifying party shall
not relieve it from any liability which it may have to any indemnified party
otherwise than under such subsection, unless and to the extent that such
indemnifying party did not otherwise learn of such action and such failure
results in the forfeiture by the indemnifying party of substantial rights or
defenses. In case any such action shall be brought against any indemnified party
and it shall notify the indemnifying party of the commencement thereof, the
indemnifying party shall be entitled to
participate therein and, to the extent that it shall elect, jointly with any
other indemnifying party similarly notified, by written notice delivered to the
indemnified party promptly after receiving the aforesaid notice from such
indemnified party, to assume the defense thereof, with counsel reasonably
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 been advised by counsel
that representation of such indemnified party and the indemnifying party would
present such counsel with a conflict of interest under applicable standards of
professional conduct due to actual or potential differing interests between them
or that there may be legal defenses available to it and/or other indemnified
parties which are different from or additional to those available to the
indemnifying party, the indemnified party or parties shall have the right to
select separate counsel to defend such action and to otherwise participate in
the defense of such action on behalf of such indemnified party or parties. It is
understood that the indemnifying party shall, in connection with any such action
or separate but substantially similar or related actions in the same
jurisdiction arising out of the same general allegations or circumstances, be
liable for the reasonable fees and expenses of only one separate firm or
attorneys together with appropriate local counsel at any time for all
indemnified parties not having actual or potential differing interests with any
indemnified party. Upon receipt of notice from the indemnifying party to such
indemnified party of the indemnifying party's election so to appoint counsel to
defend such action and approval by the indemnified party of such counsel, the
indemnifying party will not be liable for any settlement entered into without
its consent and will not be liable to such indemnified party under this Section
8 for any legal or other expenses subsequently incurred by such indemnified
party in connection with the defense thereof unless (i) the indemnified party
shall have employed separate counsel in accordance with the proviso to the next
preceding sentence, (ii) the indemnifying party shall not have employed counsel
reasonably satisfactory to the indemnified party to represent the indemnified
party within a reasonable time after notice of commencement of the action or
(iii) the indemnifying party has authorized in writing the employment of counsel
for the indemnified party at the expense of the indemnifying party; and except
that, if clause (i) or (iii) is applicable, such liability shall be only in
respect of the counsel referred to in such clause (i) or (iii). Notwithstanding
the immediately preceding sentence and the third preceding sentence, if at any
time an indemnified party shall have requested an indemnifying party to
reimburse the indemnified party for fees and expenses of counsel, the
indemnifying party agrees that it shall be liable for any settlement of any
proceeding effected without its consent if (i) such settlement is entered into
more than 30 days after receipt by such indemnifying party of the aforesaid
request and (ii) such indemnifying party shall not have reimbursed the
indemnified party in accordance with such request prior to the date of such
settlement.
(d) If the indemnification provided for in this Section 8 is unavailable
to or insufficient to hold harmless an indemnified party under subsection (a) or
(b) above in respect of any losses, claims, damages or liabilities (or actions
in respect thereof) referred to therein, then each indemnifying party shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages or liabilities (or actions in respect thereof)
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 from the
offering of the Securities. If, however, the allocation provided by the
immediately preceding sentence is not permitted by applicable law, then each
indemnifying
party shall contribute to such amount paid or payable by such indemnified party
in such proportion as is appropriate to reflect not only such relative benefits
but also the relative fault of the Company on the one hand and the Underwriters
on the other in connection with the statements or omissions which resulted in
such losses, claims, damages or liabilities (or actions or proceedings in
respect thereof), 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, 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 (after deducting the underwriting discount, but
before deducting expenses) received by the Company bear to the total
underwriting discounts received by the Underwriters, in each case as set forth
on the cover page of the Prospectus. The relative fault of the Company on the
one hand and the Underwriters on the other 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 on the one hand or the Underwriters on
the other 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 contributions pursuant to this subsection (d) were determined by
pro rata allocation or by any other method of allocation which does not take
into account the equitable considerations referred to above in this subsection
(d). The amount paid or payable by an indemnified party as a result of the
losses, claims, damages or liabilities (or actions or proceedings in respect
thereof) referred to above in this subsection (d) shall be deemed to include any
legal or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this subsection (d), (i) the provisions of the
Agreement Among Underwriters shall govern contribution among the Underwriters,
(ii) no Underwriter (except as provided in the Agreement Among Underwriters)
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 that such
Underwriter has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. Notwithstanding the
provisions of this subsection (d), no person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations under this subsection (d) are
several in proportion to their respective underwriting obligations and not
joint.
(e) The obligations of the Company under this Section 8 shall be in
addition to any liability which the Company may otherwise have and shall extend,
upon the same terms and conditions, to each officer, director, employee and
agent of the Underwriter and each person, if any, who controls any Underwriter
within the meaning of Section 15 of the Act or Section 20 of the Exchange Act;
and the obligations of the Underwriters under this Section 8 shall be in
addition to any liability which the respective Underwriters may otherwise have
and shall extend, upon the same terms and conditions, to each officer and
director of the Company and to each person, if any, who controls the Company
within the meaning of Section 15 of the Act or Section 20 of the Exchange Act.
9. SUBSTITUTION OF UNDERWRITERS.
(a) If any of the Underwriters fail to purchase on a Delivery Date the
Securities agreed to be purchased on such Delivery Date by such Underwriter or
Underwriters, and the aggregate number of Securities which such defaulting
Underwriter or Underwriters agreed but failed or refused to purchase does not
exceed 10% of the aggregate number of the Securities to be purchased on such
date, the other Underwriters shall be obligated, severally, in the proportions
that the number of Firm Securities set forth opposite their respective names on
Schedule I hereto bears to the aggregate number of Firm Securities set forth
opposite the names of all such non-defaulting Underwriters, or in such other
proportions as may be specified by the Representative with the consent of the
non-defaulting Underwriters, to purchase the Securities which such defaulting
Underwriter or Underwriters agreed but failed or refused to purchase on such
date. If on the First Delivery Date or the Second Delivery Date, as the case may
be, any one or more of the Underwriters shall fail or refuse to purchase
Securities and the aggregate number of Securities with respect to which such
default occurs exceeds 10% of the aggregate number of Securities to be purchased
on such date, and arrangements satisfactory to the Representative and the
Company for the purchase of such Securities are not made within 48 hours after
such default, this Agreement shall terminate without liability of any party
(other than a defaulting underwriter or underwriters) to any other party. In any
such case, the provisions of Sections 5, 6, 8, 11, 12, 13 and 15 through 18
shall survive such termination. In any such case either the Representative or
the Company shall have the right to postpone the First Delivery Date or the
Second Delivery Date, as the case may be, but in no event for longer than seven
days in order that the required changes, if any, to the Registration Statement
and the Prospectus or any other documents or arrangements may be effected. This
Section 9 will not affect the liability of the defaulting Underwriters to the
Company or the nondefaulting Underwriters arising out of such default. A
substitute underwriter under this Section 9 will be deemed an Underwriter for
all purposes of this Agreement.
10. REPRESENTATIONS AND WARRANTIES TO SURVIVE DELIVERY.
The respective indemnities, agreements, representations, warranties and
other statements of the Company and the several Underwriters, as set forth in
this Agreement or made by them, respectively, pursuant to this Agreement, shall
remain in full force and effect, regardless of any termination or cancellation
of this Agreement or any investigation (or any statement as to the results
thereof) made by or on behalf of the Underwriters or any controlling person of
any Underwriter, or the Company, or any officer or director or controlling
person of the Company, and shall survive delivery of and payment for the
Securities.
11. TERMINATION AND PAYMENT OF EXPENSES.
(a) This Agreement shall be subject to termination in your absolute
discretion, by notice given to the Company prior to the delivery of any payment
for the Securities, if prior to such time there shall have occurred any of the
following: (i) a suspension or material limitation in trading in securities
generally on the New York Stock Exchange or the Nasdaq National Market; (ii) a
general moratorium on commercial banking activities in New York or Virginia
declared by federal, New
York State or Virginia authorities; (iii) the outbreak or escalation of
hostilities involving the United States or the declaration by the United States
of a national emergency or war, if any such event specified in this clause (iii)
would have such a materially adverse effect, in your judgment, as to make it
impracticable to market the Securities on the terms and in the manner
contemplated in the Prospectus; or (iv) such a material adverse change in
general economic, political, financial or international conditions affecting
financial markets in the United States having a material adverse impact on
trading prices of securities in general, as, in your judgment, makes it
impracticable to market the Securities on the terms and in the manner
contemplated in the Prospectus.
(b) If this Agreement shall be terminated pursuant to this Section 11, the
Company shall not then be under any liability to any Underwriter except as
provided in Section 6 and Section 8 hereof; but if for any other reason the sale
of the Securities provided for herein is not consummated because any condition
to the obligations of the Underwriters set forth in Section 7 hereof is not
satisfied, because of any termination pursuant to this Section 11 or because of
any refusal, inability or failure on the part of the Company to perform any
agreements herein or comply with the provisions hereof other than by reason of a
default by any of the Underwriters, the Company will be responsible for and will
reimburse the Underwriters upon demand for all out-of-pocket expenses, including
reasonable fees and disbursements of counsel, reasonably incurred by the
Underwriters in connection with the proposed purchase, sale and delivery of the
Securities. Nothing in this Section 11 shall be deemed to relieve the
Underwriters of their liability, if any, to the Company for damages occasioned
by their default hereunder.
12. NOTICES.
In all dealings hereunder, you shall act on behalf of each of the
Underwriters, and the parties hereto shall be entitled to act and rely upon any
statement, request, notice or agreement on behalf of any Underwriter made or
given by you. All statements, requests, notices and agreements hereunder shall
be in writing or by telegram or facsimile if promptly confirmed in writing, and
if to the Underwriters shall be sufficient in all respects if delivered or sent
by mail, telegram or facsimile transmission to: Xxxxx & Xxxxxxxxxxxx, Inc., 000
Xxxx Xxxx Xxxxxx, Xxxxxxxx, Xxxxxxxx 00000, Attention: Corporate Finance
Department, Telecopy: (000) 000-0000; and if to the Company shall be sufficient
in all respects if delivered or sent by mail, telegram or facsimile transmission
to: U. S. Concrete, Inc., 0000 Xxxx Xxx Xxxxxxxxx, Xxxxx 000, Xxxxxxx, Xxxxx
00000, Attention: Xxxxxxx X. Xxxxxx, Telecopy: (000) 000-0000, with a copy to
Xxxxx & Xxxxx, Attention: Xxx Xxxxx, Xxxxx 0000, Xxx Xxxxx Xxxxx, Xxxxxxx, Xxxxx
00000, Telecopy: (000) 000-0000. Any such statements, requests, notices or
agreements shall take effect upon receipt thereof.
13. SUCCESSORS.
This Agreement shall be binding upon, and inure solely to the benefit of,
the Underwriters and the Company and, to the extent provided in Sections 8 and
10 hereof, the officers and directors of the Company, the officers and
directors, employees and agents of any Underwriter and each person who controls
the Company or any Underwriter, and their respective heirs, executors,
administrators, successors and assigns, and no other person shall acquire or
have any right under or
by virtue of this Agreement. No purchaser of any of the Securities from any
Underwriter shall be deemed a successor or assign by reason merely of such
purchase.
14. TIME OF THE ESSENCE.
Time shall be of the essence in the performance under this Agreement.
15. BUSINESS DAY.
As used herein, the term "business day" shall mean any day when the
Commission's office in Washington, D.C. is open for business.
16. APPLICABLE LAW.
This Agreement shall be governed by and construed in accordance with the
laws of the State of New York without regard to its conflicts of laws
provisions.
17. CAPTIONS.
The captions included in this Agreement are included solely for
convenience of reference and shall not be deemed to be a part of this Agreement.
18. COUNTERPARTS.
This Agreement may be executed by any one or more of the parties 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 instrument.
If the foregoing is in accordance with your understanding, please sign and
return to us two counterparts hereof, and upon the acceptance hereof by you,
this letter and such acceptance hereof shall constitute a binding agreement
among each of the Underwriters and the Company. It is understood that your
acceptance of this Agreement on behalf of each of the Underwriters is pursuant
to the authority set forth in a form of Agreement Among Underwriters, the form
of which will be submitted to the Company for examination, upon request, but
without warranty on your part as to the authority of the signers thereof.
Very truly yours,
U.S. CONCRETE, INC.
By: _______________________________
Xxxxxx X. Xxxxxxxxx
President and Chief Executive Officer
Accepted as of the date hereof at Richmond, Virginia:
XXXXX & XXXXXXXXXXXX, INC.
As Representative of the Underwriters
By: _______________________________
Title: ____________________________
SCHEDULE I
UNDERWRITERS
UNDERWRITER FIRM SECURITIES TO BE PURCHASED
--------------------- -----------------------------------
Xxxxx & Xxxxxxxxxxxx, Inc.
Xxxxxxx Xxxxxx Xxxxx Inc.
TOTAL 3,800,000
SCHEDULE II
SUBSIDIARIES AND FOUNDING COMPANIES
SUBSIDIARIES
------------
Xxxx Acquisition Inc.
Bay Cities Acquisition Inc.
Central Concrete Acquisition Inc.
OCC Acquisition Inc.
Santa Xxxx Acquisition Inc.
Xxxxxx'x Acquisition Inc.
FOUNDING COMPANIES
------------------
Central Concrete Supply Co., Inc.
Xxxxxx'x Concrete, Inc.
Bay Cities Building Materials Co., Inc.
Opportunity Concrete Corporation
Xxxx Concrete, Incorporated
Santa Xxxx Cast Products Co.
ANNEX I
(TO COME)
ANNEX II
Pursuant to Section 7(e) of the Underwriting Agreement, Xxxxxx Xxxxxxxx,
LLP shall furnish letters to the Representative to the effect that:
1. They are independent public accountants with respect to the Company and
its subsidiaries within the meaning of the Act and the applicable published
rules and regulations thereunder;
2. In their opinion, the consolidated audited financial statements audited
by them and included in the Registration Statement and the Prospectus comply as
to form in all material respects with the applicable accounting requirements of
the Act and the related published rules and regulations thereunder;
3. On the basis of limited procedures, not constituting an examination in
accordance with generally accepted auditing standards, consisting of a reading
of the latest unaudited financial statements made available by the Company,
inspection of the minute books of the Company and the Subsidiaries since the
date of the latest audited financial statements included in the Prospectus,
inquiries of officials of the Company and the Founding Companies responsible for
financial and accounting matters and such other inquiries and procedures as may
be specified in such letter, nothing came to their attention that caused them to
believe that:
(A) the unaudited consolidated financial statements included in the
Registration Statement or the Prospectus do not comply as to form in all
material respects with the applicable accounting requirements of the Act
and published rules and regulations thereunder or are not presented in
conformity with generally accepted accounting principles applied on a
basis substantially consistent with that of the audited consolidated
financial statements included in the Registration Statement or Prospectus;
(B) (i) as of a specified date not more than five calendar days
prior to the date of delivery of such letter, there have been any change
in the capital stock, any increase in long-term debt of the Company, or
any decreases in total assets or stockholders' equity as compared with
amounts shown on the most recent consolidated balance sheet included in
the Registration Statement or Prospectus, and (ii) for the period from the
date of the most recent financial statements included in the Registration
Statement or Prospectus to such specified date there were any decreases in
the total or per share amounts of net income as compared with the
corresponding period in the preceding year, except in each case for
increases or decreases which the Prospectus discloses have occurred or may
occur or which are described in such letter; and
4. In addition to the audit referenced in their report included in the
Registration Statement and the Prospectus and the limited procedures, inspection
of minute books, inquiries and
other procedures referred to above, they have carried out certain specified
procedures, not constituting an audit in accordance with generally accepted
auditing standards, with respect to certain amounts, percentages and financial
information which are derived from the general accounting records of the
Company, the Subsidiaries and the Founding Companies, which appear in any
Preliminary Prospectus, the Prospectus, or in Part II of, or in exhibits and
schedules to, the Registration Statement specified by the Representative, and
have compared certain of such amounts, percentages and financial information
with the accounting records of the Company and the Founding Companies and have
found them to be in agreement.
