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VALLEY NATIONAL GASES INCORPORATED
2,700,000 SHARES
COMMON STOCK
($.001 PAR VALUE)
UNDERWRITING AGREEMENT
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----------------, 1997
X.X. Xxxxxxx & Sons, Inc.
Xxxxxxxxxxx & Co., Inc.
As Representatives of the Several Underwriters
c/o X.X. Xxxxxxx & Sons, Inc.
Xxx Xxxxx Xxxxxxxxx Xxxxxx
Xx. Xxxxx, Xxxxxxxx 00000
The undersigned, Valley National Gases Incorporated, a
Pennsylvania corporation (the "Company") and the persons listed on
Schedule I hereto (the "Selling Shareholders"), hereby address you
as the representatives (the "Representatives") of each of the
persons, firms and corporations listed on Schedule II hereto
(collectively, the "Underwriters") and hereby confirm their
agreement with the several Underwriters as follows:
1. DESCRIPTION OF SHARES. The Company proposes to issue and
sell to the Underwriters 2,618,000 shares of its Common Stock, par
value $0.001 per share, and the Selling Shareholders propose to
sell to the Underwriters a total of 82,000 shares of the Company's
Common Stock, par value $0.001 per share, as set forth on
Schedule I hereto (such 2,700,000 shares of Common Stock are herein
referred to as the "Firm Shares"). Solely for the purpose of
covering over-allotments in the sale of the Firm Shares, the
Company further proposes to grant to the Underwriters the right to
purchase up to an additional 405,000 shares of the Company Common
Stock (the "Option Shares"), as provided in Section 3 of this
Agreement. The Firm Shares and the Option Shares are herein
sometimes referred to as the "Shares" and are more fully described
in the Prospectus hereinafter defined.
2. PURCHASE, SALE AND DELIVERY OF FIRM SHARES. On the basis
of the representations, warranties and agreements herein contained,
but subject to the terms and conditions herein set forth, the
Company agrees and each Selling Shareholder agrees, severally and
not jointly, to sell to the Underwriters, and each such Underwriter
agrees, severally and not jointly, (a) to purchase from the Company
and from each of the Selling Shareholders, pro rata, at a purchase
price of $ per share, the number of Firm Shares set forth
opposite the name of such Underwriter in Schedule II hereto and (b)
to purchase from the Company any additional number of Option Shares
which such Underwriter may become obligated to purchase pursuant to
Section 3 hereof.
The Company and the Selling Shareholders will deliver
definitive certificates for the Firm Shares at the office of X.X.
Xxxxxxx & Sons, Inc., 00 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
("Xxxxxxx' Office"), or such other place as you and the Company may
mutually agree upon, for the accounts of the Underwriters against
payment to the Company and the Selling Shareholders of the purchase
price for the Firm Shares sold by them to the several Underwriters
by wire transfer in immediately available funds to bank accounts
designated by the Company and Selling Shareholders, respectively.
The closing shall take place at X.X. Xxxxxxx & Sons, Inc., Xxx
Xxxxx Xxxxxxxxx Xxxxxx, Xx. Xxxxx, Xxxxxxxx 00000, or at such other
place as may be agreed upon between you and the Company (the "Place
of Closing"), at 10:00 a.m., St. Louis time, on the third (fourth,
if pricing occurs after 3:30 p.m. St. Louis time) full business day
following the date of
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this Agreement, or at such other time and date as you and the Company may
agree, such time and date of payment and delivery being herein called the
"Closing Date."
The certificates for the Firm Shares so to be delivered
will be made available to you for inspection at Xxxxxxx' Office (or
such other place as you and the Company may mutually agree upon) at
least one full business day prior to the Closing Date and will be
in such names and denominations as you may request at least two
full business days prior to the Closing Date.
It is understood that an Underwriter, individually, may
(but shall not be obligated to) make payment on behalf of the other
Underwriters whose checks shall not have been received prior to the
Closing Date for Shares to be purchased by such Underwriter. Any
such payment by an Underwriter shall not relieve the other
Underwriters of any of their obligations hereunder.
It is understood that the Underwriters propose to offer
the Shares to the public upon the terms and conditions set forth in
the Registration Statement hereinafter defined.
3. PURCHASE, SALE AND DELIVERY OF THE OPTION SHARES. The
Company hereby grants options to the Underwriters to purchase from
the Company up to 405,000 Option Shares on the same terms and
conditions as the Firm Shares; provided, however, that such options
may be exercised only for the purpose of covering any
over-allotments which may be made by them in the sale of the Firm
Shares. No Option Shares shall be sold or delivered unless the
Firm Shares previously have been, or simultaneously are, sold and
delivered.
The options are exercisable on behalf of the several
Underwriters by you, as Representatives, at any time, and from time
to time, before the expiration of 30 days from the date of this
Agreement, for the purchase of all or part of the Option Shares
covered thereby, by notice given by you to the Company in the
manner provided in Section 13 hereof, setting forth the number of
Option Shares as to which the Underwriters are exercising the
options, and the date of delivery of said Option Shares, which date
shall not be more than five (5) business days after such notice
unless otherwise agreed to by the parties. You may terminate the
options at any time, as to any unexercised portion thereof, by
giving written notice to the Company to such effect.
You, as Representatives, shall make such allocation of
the Option Shares among the Underwriters as may be required to
eliminate purchases of fractional Shares.
Delivery of the Option Shares with respect to which the
options shall have been exercised shall be made to or upon your
order at Xxxxxxx' Office (or at such other place as you and the
Company may mutually agree upon), against payment by you of the per
share purchase price to the Company by wire transfer in immediately
available funds to a bank account designated by the Company. Such
payment and delivery shall be made at 10:00 a.m., St. Louis time,
on the date designated in the notice given by you as above provided
for, unless some other date and time are agreed upon, which date
and time of payment and delivery are called the "Option Closing
Date." The certificates for the Option Shares so to be delivered
will be made available to you for inspection at Xxxxxxx' Office at
least one full business day prior to the Option Closing Date and
will be in such names and denominations as you may request at least
two (2) full business days prior to the Option Closing Date. On
the Option Closing Date, the Company shall provide the Underwriters
such representations, warranties, opinions and covenants with
respect to the Option Shares as are required to be delivered on the
Closing Date with respect to the Firm Shares.
4. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE COMPANY
AND THE SELLING SHAREHOLDERS.
(a) The Company represents and warrants to and agrees
with each Underwriter that:
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(i) A registration statement (Registration No.
333-19973) on Form S-1 with respect to the
Shares, including a preliminary
prospectus, and such amendments to such
registration statement as may have been
required to the date of this Agreement,
has been carefully prepared by the Company
pursuant to and in conformity with the
requirements of the Securities Act of
1933, as amended (the "Act"), and the
Rules and Regulations (the "Rules and
Regulations") of the Securities and
Exchange Commission (the "Commission")
thereunder and has been filed with the
Commission under the Act. Copies of such
registration statement, including any
amendments thereto, each related
preliminary prospectus (meeting the
requirements of Rule 430 or 430A of the
Rules and Regulations) contained therein,
the exhibits, financial statements and
schedules have heretofore been delivered
by the Company to you. If such
registration statement has not become
effective under the Act, a further
amendment to such registration statement,
including a form of final prospectus,
necessary to permit such registration
statement to become effective will be
filed promptly by the Company with the
Commission. If such registration
statement has become effective under the
Act, a final prospectus containing
information permitted to be omitted at the
time of effectiveness by Rule 430A of the
Rules and Regulations will be filed
promptly by the Company with the
Commission in accordance with Rule 424(b)
of the Rules and Regulations. The term
"Registration Statement" as used herein
means the registration statement as
amended at the time it becomes or became
effective under the Act (the "Effective
Date"), including financial statements and
all exhibits and, if applicable, the
information deemed to be included by Rule
430A of the Rules and Regulations. The
term "Prospectus" as used herein means (i)
the prospectus as first filed with the
Commission pursuant to Rule 424(b) of the
Rules and Regulations, or (ii) if no such
filing is required, the form of final
prospectus included in the Registration
Statement at the Effective Date, or (iii)
if a Term Sheet or Abbreviated Term Sheet
(as such terms are defined in Rules 434(b)
and 434(c), respectively, of the Rules and
Regulations) is filed with the Commission
pursuant to Rule 424(b)(7) of the Rules
and Regulations, the Term Sheet or
Abbreviated Term Sheet and the last
Preliminary Prospectus filed with the
Commission prior to the time the
Registration Statement became effective,
taken together. The term "Preliminary
Prospectus" as used herein shall mean a
preliminary prospectus as contemplated by
Rule 430 or 430A of the Rules and
Regulations included at any time in the
Registration Statement.
(ii) The Commission has not issued, and is not
to the knowledge of the Company
threatening to issue, an order preventing
or suspending the use of any Preliminary
Prospectus or the Prospectus nor
instituted proceedings for that purpose.
Each Preliminary Prospectus at its date of
issue, the Registration Statement and the
Prospectus and any amendments or
supplements thereto contains or will
contain, as the case may be, all
statements which are required to be stated
therein by, and in all material respects
conform or will conform, as the case may
be, to the requirements of, the Act and
the Rules and Regulations. Neither the
Registration Statement nor any amendment
thereto, as of the applicable effective
date, and neither the Prospectus nor any
supplement thereto contains or will
contain, as the case may be, any untrue
statement of a material fact or omits or
will omit to state any material fact
required to be stated therein or
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necessary to make the statements therein, in the
light of the circumstances under which
they were made, not misleading; provided,
however, that the Company makes no
representation or warranty as to
information contained in or omitted from
the Registration Statement or the
Prospectus, or any such amendment or
supplement, in reliance upon, and in
conformity with, written information
furnished to the Company by or on behalf
of the Underwriters specifically for use
in the preparation thereof.
(iii) The filing of the Registration Statement
and the execution and delivery of this
Agreement have been duly authorized by the
Board of Directors of the Company; this
Agreement constitutes a valid and legally
binding obligation of the Company
enforceable in accordance with its terms
(except to the extent the enforceability
of the indemnification and contribution
provisions of Section 7 hereof may be
limited by public policy considerations as
expressed in the Act as construed by
courts of competent jurisdiction, and
except as enforceability may be limited by
bankruptcy, insolvency, reorganization,
moratorium and other laws affecting
creditors' rights generally and by general
principles of equity); the issue and sale
of the Shares by the Company and the
performance of this Agreement and the
consummation of the transactions herein
contemplated will not result in a
violation of the Company's Articles of
Incorporation or Bylaws or result in a
breach or violation of any of the terms
and provisions of, or constitute a default
under, or result in the creation or
imposition of any lien, charge or
encumbrance upon any properties or assets
of the Company or its subsidiaries under
any statute, or under any indenture,
mortgage, deed of trust, note, loan
agreement, sale and leaseback arrangement
or other agreement or instrument to which
the Company or any of its subsidiaries is
a party or by which they are bound or to
which any of the properties or assets of
the Company is subject, or any order, rule
or regulation of any court or governmental
agency or body having jurisdiction over
the Company or its subsidiaries or their
properties, except to such extent in each
such case as does not materially adversely
affect the business of the Company and its
subsidiaries taken as a whole; no consent,
approval, authorization, order,
registration or qualification of or with
any court or governmental agency or body
is required for the consummation of the
transactions herein contemplated, except
such as may be required by the National
Association of Securities Dealers, Inc.
(the "NASD") or under the Act or Rules and
Regulations or any state securities laws.
(iv) Except as described in the Prospectus,
neither the Company nor any of its
subsidiaries 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. Except as contemplated in the
Prospectus, subsequent to the respective
dates as of which information is given in
the Registration Statement and the
Prospectus, the Company and its
subsidiaries taken as a whole have not
incurred any material liabilities or
material obligations, direct or
contingent, other than in the ordinary
course of business, or entered into any
material transactions not in the ordinary
course of business, and there has not been
any material change in the capital stock
or long-term debt of the Company and its
subsidiaries taken as a whole or
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any material adverse change in the condition
(financial or other), net worth, business,
affairs, management, prospects or results
of operations of the Company and its
subsidiaries taken as a whole. The
Company and its subsidiaries have filed
all necessary federal, state and foreign
income and franchise tax returns, other
than returns the filing of which are being
contested in good faith, and paid all
taxes shown as due thereon, other than
those being contested in good faith and
for which adequate reserves have been
provided or those currently payable
without penalty or interest; all tax
liabilities are adequately provided for on
the books of the Company and its
subsidiaries except to such extent as
would not materially adversely affect the
business of the Company and its
subsidiaries taken as a whole; the Company
and its subsidiaries have made all
necessary payroll tax payments as of the
date of this Agreement; and the Company
and its subsidiaries have no knowledge of
any tax proceeding or action pending or
threatened against the Company or its
subsidiaries which might materially
adversely affect their business or
property taken as a whole.
(v) Except as described in the Prospectus,
there is not now pending or, to the
knowledge of the Company or its
subsidiaries, threatened or contemplated,
any action, suit or proceeding to which
the Company or its subsidiaries is a party
before or by any court or public,
regulatory or governmental agency or body
which might be expected to result
(individually or in the aggregate) in any
material adverse change in the condition
(financial or other), business or
prospects of the Company and its
subsidiaries taken as a whole, or might be
expected to materially and adversely
affect (individually or in the aggregate)
the properties or assets thereof.
(vi) The Company has duly and validly
authorized capital stock as described in
the Prospectus; all outstanding shares of
Common Stock of the Company and the Shares
conform, or when issued will conform, to
the description thereof in the
Registration Statement and the Prospectus
and have been, or, when issued and paid
for will be, duly authorized, validly
issued, fully paid and nonassessable; and
the issuance of the Shares to be purchased
from the Company hereunder is not subject
to preemptive rights. All offers and
sales by the Company and its subsidiaries
of their securities during the past three
(3) years were at all relevant times duly
registered or exempt from the registration
requirements of the Act and were duly
registered or the subject of an exemption
from the registration requirements of
applicable state securities laws. Except
as set forth in the Prospectus, the
Company does not have outstanding, and at
the Closing Date, will not have
outstanding, any options to purchase, or
any rights or warrants to subscribe for,
or any securities or obligations
convertible into, or any contracts, or
commitments to issue or sell any shares of
Common Stock or any such warrants,
convertible securities or obligations.
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 owned or to
be owned by such person or to require the
Company to include such securities in the
securities registered pursuant to the
Registration Statement or in any
securities being registered pursuant to
any other registration statement filed by
the Company under the Act.
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(vii) The Company and its subsidiaries have been
duly incorporated and are validly existing
as corporations in good standing under the
laws of the states or jurisdictions in
which they are incorporated, with full
power and authority (corporate and other)
to own, lease and operate their properties
and conduct their business as described in
the Registration Statement; the Company
and its subsidiaries are duly qualified to
do business as foreign corporations and
are in good standing in each state or
other jurisdiction in which their
ownership or leasing of property or
conduct of business legally requires such
qualification, except where the failure to
be so qualified would not have a material
adverse effect on the ability of the
Company and its subsidiaries taken as a
whole to conduct its or their business as
described in the Registration Statement;
the outstanding shares of capital stock of
the Company's subsidiaries have been duly
authorized and validly issued, are fully
paid and nonassessable and are owned by
the Company or a subsidiary of the Company
free and clear of any mortgage, pledge,
lien, encumbrance, charge or adverse claim
and are not the subject of any agreement
or understanding with any person; and no
options, warrants or other rights to
purchase, agreement or other obligations
to issue or other rights to convert any
obligations into shares of capital stock
or ownership interests in the subsidiaries
are outstanding.
(viii) Xxxxxx Xxxxxxxx LLP, the accounting firm
which has certified the financial
statements filed with the Commission as a
part of the Registration Statement, is an
independent public accounting firm within
the meaning of the Act and the Rules and
Regulations.
(ix) 1) The consolidated financial
statements (including the condensed
financial statements) and schedules,
including the notes thereto,
included in the Registration
Statement and the Prospectus with
respect to the Company and its
subsidiaries comply in all material
respects with the Act and the
Regulations thereunder and present
fairly the consolidated financial
position of the Company and its
subsidiaries as of the dates
indicated and the related statements
of operations, cash flows and
stockholders' equity of the Company
and its subsidiaries for the periods
specified and have been prepared in
conformity with generally accepted
accounting principles applied on a
consistent basis. The selected and
summary consolidated financial
information with respect to the
Company and its subsidiaries
included in the Registration
Statement and the Prospectus present
fairly the information set forth
therein in compliance with the
applicable regulations of the
Commission and have been compiled on
a basis consistent with that of the
audited consolidated financial
statements of the Company and its
subsidiaries in the Registration
Statement and the Prospectus.
2) The financial statements and
schedules of Weldco, Inc., including
the notes thereto, included in the
Registration Statement and the
Prospectus comply in all material
respects with the Act and the
Regulations thereunder and present
fairly the financial position of
Weldco, Inc. as of the dates
indicated and the related statements
of operations, cash flows and
stockholders' equity for the periods
specified and have been prepared in
conformity with generally
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accepted accounting principles applied on a
consistent basis. The selected and
summary financial information with
respect to Weldco, Inc. included in
the Registration Statement and the
Prospectus present fairly the
information set forth therein and in
compliance with the applicable
regulations of the Commission and
have been compiled on a basis
consistent with that of the audited
financial statements of Weldco, Inc.
in the Registration Statement and
the Prospectus.
3) The pro forma condensed financial
statements combining financial
statements for the Company, its
subsidiaries and Weldco, Inc.
included in the Registration
Statement and the Prospectus comply
in form in all material respects
with the applicable accounting
requirements of Article 11 of
Regulation S-X of the commission and
the pro forma adjustments have been
properly applied to the historical
amounts in the compilation of those
statements. The selected and
summary information included in the
Registration Statement and the
Prospectus present fairly the
information set forth therein and
have been compiled on a basis
consistent with that of the pro
forma combined condensed financial
statements in the Registration
Statement and Prospectus.
(x) Neither the Company nor any of its
subsidiaries is in default with respect to
any contract or agreement to which it is a
party; provided that this representation
shall not apply to defaults which in the
aggregate are not materially adverse to
the condition, financial or other, or the
business or prospects of the Company and
its subsidiaries taken as a whole.
(xi) Neither the Company nor any of its
subsidiaries is in violation of any laws,
ordinances or governmental rules or
regulations to which it is subject, and
neither the Company nor any of its
subsidiaries has failed to obtain any
other license, permit, franchise,
easement, consent, or other governmental
authorization necessary to the ownership,
leasing and operation of its properties or
to the conduct of its business, which
violation or failure would materially
adversely affect the business, operations,
affairs, properties, prospects, profits or
condition (financial or other) of the
Company and its subsidiaries taken as a
whole. Neither the Company nor any of its
subsidiaries has, at any time during the
past five (5) years, (a) made any unlawful
contributions to any candidate for any
political office, or failed fully to
disclose any contribution in violation of
law, or (b) made any payment to any state,
federal or foreign government official, or
other person charged with similar public
or quasi-public duty (other than payment
required or permitted by applicable law).
(xii) Except as described in the Prospectus, the
Company or its subsidiaries own or
possess, or can acquire on reasonable
terms, adequate patents, patent licenses,
trademarks, service marks and trade names
necessary to conduct the business now
operated by it, and neither the Company
nor its subsidiaries has received any
notice of infringement of or conflict with
asserted rights of others with respect to
any patents, patent licenses, trademarks,
service marks or trade names which, singly
or in the aggregate, if the subject of an
unfavorable decision, ruling or finding,
would have a
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material adverse effect on the conduct of the
business, operations, financial condition or income of
the Company and its subsidiaries taken as a whole.
(xiii) Neither the Company nor any of its
subsidiaries own any real estate. The
Company and its subsidiaries have good and
marketable title to all other property
owned by them, free and clear of all
liens, encumbrances, restrictions and
defects except such as are described in
the Registration Statement or do not
interfere with the use made and proposed
to be made of such property; and any
property held under lease or sublease by
the Company or its subsidiaries is held
under valid, subsisting and enforceable
leases or subleases with such exceptions
as are not material and do not interfere
with the use made and proposed to be made
of such property by the Company or its
subsidiaries and neither the Company nor
any of its subsidiaries has notice or
knowledge of any material claim of any
sort which has been, or may be, asserted
by anyone adverse to the Company's or any
subsidiary's rights as lessee or sublessee
under any lease or sublease described
above, or affecting or questioning the
Company's or any of its subsidiaries'
rights to the continued possession of the
leased or subleased premises under any
such lease or sublease in conflict with
the terms thereof.
(xiv) Except as described in the Prospectus,
there is no factual basis for any action,
suit or other proceeding involving the
Company or any of its subsidiaries or any
of their material assets for any failure
of the Company or any of its subsidiaries,
or any predecessor thereof, to comply with
any requirements of federal, state or
local regulation relating to air, water,
solid waste management, hazardous or toxic
substances, or the protection of health or
the environment. Except as described in
the Prospectus, none of the property
leased by the Company or any of its
subsidiaries is, to the best knowledge of
the Company, contaminated with any waste
or hazardous substances, and neither the
Company nor any of its subsidiaries may be
deemed an "owner or operator" of a
"facility" or "vessel" which owns,
possesses, transports, generates or
disposes of a "hazardous substance" as
those terms are defined in Section 9601 of
the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, 42
U.S.C. Section 9601 et seq.
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(xv) No labor disturbance with the employees of
the Company or its subsidiaries exists or,
to the knowledge of the Company or its
subsidiaries, is imminent which would have
a material adverse effect on the Company
and its subsidiaries taken as a whole.
(xvi) The Company has not taken and will not
take, directly or indirectly, any action
designed to or which might reasonably be
expected to cause or result in
stabilization or manipulation of the price
of the Company's Common Stock, and the
Company is not aware of any such action
taken or to be taken by affiliates of the
Company.
(xvii) Neither the Company nor any of its
subsidiaries is an "investment company" or
a company "controlled" by an "investment
company" within the meaning of the
Investment Company Act of 1940, as
amended.
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(xviii) The Company's and its subsidiaries'
systems of internal accounting controls
are sufficient to meet the broad
objectives of internal accounting control
insofar as those objectives pertain to the
prevention or detection of errors or
irregularities in amounts that would be
material in relation to the Company's or
its subsidiaries' financial statements;
and, except as disclosed in the
Prospectus, the Company, its subsidiaries,
or any employee or agent of the Company or
its subsidiaries has not made any payment
of funds of the Company or any of its
subsidiaries or received or retained any
funds in violation of any law, rule or
regulation, the receipt or payment of
which could have a material adverse effect
on the Company and its subsidiaries as a
whole.
(xix) There is no document or contract of a
character required to be described in the
Registration Statement or the Prospectus
or to be filed as an exhibit to the
Registration Statement that is not
described or filed as required. All such
contracts to which the Company or any of
its subsidiaries is a party has been duly
authorized, executed and delivered by the
Company or its subsidiaries, constitute
valid and binding agreements of the
Company or its subsidiaries and are
enforceable by the Company or its
subsidiaries in accordance with the terms
thereof.
(xx) Other than as contemplated by this
Agreement, there is no broker, finder or
other party that is entitled to receive
from the Company or any of its
subsidiaries any brokerage or finder's fee
or other fee or commission as a result of
any of the transactions contemplated by
this Agreement.
(xxi) The Company conducts its business in the
State of Pennsylvania through VNG Holding
Company, a Pennsylvania business trust
(the "Trust"); the Trust has been duly
organized, is validly existing and is in
good standing under the laws of
Pennsylvania and is not required to
qualify to do business under the laws of
any other jurisdiction; the Company holds
a 99% beneficial interest in the Trust
free and clear of any mortgage, pledge,
lien, encumbrance, charge or adverse
claim; no options or other rights to
purchase, agreement or other obligations
to issue or other rights to convert any
obligations into beneficial interests in
the Trust are outstanding; and the
representations and warranties contained
in (v) and (x) through (xv) above are true
and correct with respect to the Trust.
(xxii) The Company conducts no operations and
holds no assets other than 1,000 shares of
common stock of Valley National Gases
Delaware, Inc., a Delaware corporation
("VNG(DE)"). VNG(DE) conducts no
operations and holds no assets other than
30.6 shares of Valley National Gases,
Inc., a West Virginia corporation
("VNG(WV)"). Other than VNG(DE) and
VNG(WV), the Company has no subsidiaries
(as used herein, the term "subsidiary" or
"subsidiaries" means wholly-owned direct
or indirect subsidiaries of the Company,
and therefore excludes the Trust). Other
than its subsidiaries and the Trust, the
Company has no direct or indirect interest
in over 5% of the outstanding securities
or interests of any other entity.
(b) Each Selling Shareholder severally represents and
warrants to and agrees with each Underwriter and
the Company that:
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(i) All authorizations and consents necessary
for the execution and delivery by such
Selling Shareholder of this Agreement and
the sale and delivery of the Shares to be
sold by such Selling Shareholder hereunder
have been given and are in full force and
effect on the date hereof and will be in
full force and effect on the Closing Date.
(ii) Such Selling Shareholder has, and on the
Closing Date will have good and valid
title to the Shares to be sold by such
Selling Shareholder, free and clear of all
liens, mortgages, pledges, encumbrances,
claims, equities and security interests
whatsoever, and will have, full right,
power and authority to enter into this
Agreement and to sell, assign, transfer
and deliver the Shares to be sold by such
Selling Shareholder hereunder.
(iii) Upon delivery of and payment for such
Shares hereunder, the several Underwriters
(assuming they are bona fide purchasers
under the Uniform Commercial Code) will
acquire valid and unencumbered title to
such Shares to be sold by such Selling
Shareholder hereunder, free and clear of
all liens, mortgages, pledges,
encumbrances, claims, equities and
security interests whatsoever.
(iv) The consummation by such Selling
Shareholder of the transactions
contemplated herein and the fulfillment by
such Selling Shareholder of the terms
hereof will not result in a violation or
breach of any terms or provisions of, or
constitute a default under, any indenture,
mortgage, deed of trust, note, loan
agreement, sale and leaseback arrangement
or other agreement or instrument to which
such Selling Shareholder is a party, or of
any order, rule or regulation applicable
to such Selling Shareholder of any court
or of any regulatory body of an
administrative agency or other
governmental body having jurisdiction over
such Selling Shareholder, except as to
such extent as does not prohibit or in any
way limit the ability of the Selling
Shareholder to comply with the terms of
this Agreement.
(v) Such Selling Shareholder has not taken and
will not take, directly or indirectly, any
action designed to or which might be
reasonably expected to cause or result in
stabilization or manipulation of the price
of the Company's Common Stock, and such
Selling Shareholder is not aware of any
such action taken or to be taken by
affiliates of such Selling Shareholder.
(vi) When the Registration Statement becomes
effective and at all times subsequent
thereto, such information in the
Registration Statement and Prospectus and
any amendments or supplements thereto as
specifically refers to such Selling
Shareholder will not contain any untrue
statement of a material fact or omit to
state any material fact required to be
stated therein or necessary to make the
statements therein not misleading.
(vii) Certificates in negotiable form
representing all of the Shares to be sold
by such Selling Shareholder hereunder have
been placed in the custody of Xxxx X. Xxxx
and Xxxxxxxx X. Xxxxx (the "Custodians")
under a Custody Agreement (the "Custody
Agreement"), duly executed and delivered
by such Selling Shareholder, with the
Custodians having the authority to deliver
the Shares to be sold by such Selling
Shareholder hereunder, and that such
Selling Shareholder has duly executed and
delivered a Power of Attorney
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(the "Power of Attorney") appointing Xxxx X. Xxxx and
Xxxxxxxx X. Xxxxx as such Selling
Shareholder's attorneys-in-fact (the
"Attorneys-in-Fact") with the Attorneys-
in-Fact having authority to execute and
deliver this Agreement on behalf of such
Selling Shareholder, to determine the
purchase price to be paid by the
Underwriters to the Selling Shareholders
as provided in Section 2, to authorize the
delivery of the Shares to be sold by such
Selling Shareholder hereunder and
otherwise to act on behalf of such Selling
Shareholder in connection with the
transactions contemplated by this
Agreement and such Custody Agreement.
(viii) The Shares represented by the certificates
held in custody for such Selling
Shareholder under the Custody Agreement
are subject to the interests of the
Underwriters hereunder, and the
arrangements made by such Selling
Shareholder for such custody, and the
appointment by such Selling Shareholder of
the Custodians under the Custody Agreement
and of the Attorneys-in-Fact by the Power
of Attorney, are to that extent
irrevocable.
(ix) The obligations of such Selling
Shareholder hereunder shall not be
terminated by operation of law, whether by
the death or incapacity of any individual
Selling Shareholder or by the occurrence
of any other event, and if any Selling
Shareholder should die or become
incapacitated, or if any other such event
should occur before the delivery of the
Shares hereunder, certificates
representing the Shares shall be delivered
by or on behalf of each Selling
Shareholder in accordance with the terms
and conditions of this Agreement and of
the Custody Agreement, and actions taken
by the Custodians pursuant to the Custody
Agreement or by the Attorneys-in-Fact
pursuant to the Power of Attorney shall be
as valid as if such death, incapacity or
other event had not occurred, regardless
of whether or not the Custodians or
Attorneys-in-Fact, or any of them, shall
have received notice of such death,
incapacity or other event.
(x) Such Selling Shareholder is not prompted
to sell shares of Common Stock by any
information concerning the Company or any
of its subsidiaries which is not included
in the Registration Statement.
(c) Any certificate signed by any officer of the
Company and delivered to you or to counsel for the
Underwriters shall be deemed a representation and
warranty by the Company to each Underwriter as to
the matters covered thereby; and any certificate
signed by or on behalf of any Selling Shareholder
as such and delivered to you or to counsel for the
Underwriters shall be deemed a representation and
warranty by such Selling Shareholder to each
Underwriter as to the matters covered thereby.
5. ADDITIONAL COVENANTS. The Company and, where expressly
indicated, the Selling Shareholders, covenant and agree with the
several Underwriters that:
(a) If the Registration Statement is not effective
under the Act, the Company will use its best
efforts to cause the Registration Statement to
become effective as promptly as possible, and it
will notify you, promptly after it shall receive
notice thereof, of the time when the Registration
Statement has become effective. The Company (i)
will prepare and timely file with the Commission
under Rule 424(b) of the Rules and Regulations, if
required, a Prospectus containing information
previously omitted at the time of effectiveness of
the Registration Statement in reliance on Rule 430A of
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the Rules and Regulations or otherwise or a Term
Sheet or Abbreviated Term Sheet, as applicable;
(ii) will not file any amendment to the
Registration Statement or supplement to the
Prospectus of which the Underwriters shall not
previously have been advised and furnished with a
copy or to which the Underwriters shall have
reasonably objected in writing or which is not in
compliance with the Rules and Regulations; and
(iii) will promptly notify you after it shall have
received notice thereof of the time when any
amendment to the Registration Statement becomes
effective or when any supplement to the Prospectus
has been filed.
(b) The Company will advise the Underwriters promptly,
after it shall receive notice or obtain knowledge
thereof, of any request of the Commission for
amendment of the Registration Statement or for
supplement to the Prospectus or for any additional
information, or of the issuance by the Commission
of any stop order suspending the effectiveness of
the Registration Statement or the use of the
Prospectus or of the institution or threatening of
any proceedings for that purpose, and the Company
will use its best efforts to prevent the issuance
of any such stop order preventing or suspending the
use of the Prospectus and to obtain as soon as
possible the lifting thereof, if issued.
(c) The Company will cooperate with the Underwriters
and their counsel in endeavoring to qualify the
Shares for sale under the securities laws of such
jurisdictions as they may have designated and will
make such applications, file such documents, and
furnish such information as reasonably may be
necessary for that purpose, provided the Company
shall not be required to qualify as a foreign
corporation or to file a general consent to service
of process in any jurisdiction where it is not now
so qualified or required to file such a consent or
to subject itself to taxation as doing business in
any jurisdiction where it is not now so taxed. The
Company will, from time to time, file such
statements, reports, and other documents, as are or
may reasonably be required to continue such
qualifications in effect for so long a period as
the Underwriters may reasonably request.
(d) The Company will deliver to, or upon the order of,
the Underwriters, without charge from time to time,
as many copies of any Preliminary Prospectus as
they may reasonably request. The Company will
deliver to, or upon the order of, the Underwriters
without charge as many copies of the Prospectus, or
as it thereafter may be amended or supplemented, as
they may from time to time reasonably request. The
Company consents to the use of such Prospectus by
the Underwriters and by all dealers to whom the
Shares may be sold, both in connection with the
offering or sale of the Shares and for such other
purposes and for such period of time thereafter as
the Prospectus is required by law to be delivered
in connection with the offering or sale of the
Shares. The Company will deliver to the
Underwriters at or before the Closing Date two (2)
signed copies of the Registration Statement and all
amendments thereto including all exhibits filed
therewith, and will deliver to the Underwriters
such number of copies of the Registration
Statement, without exhibits, and of all amendments
thereto, as they may reasonably request.
(e) If, during the period in which a prospectus is
required by law to be delivered by an Underwriter
or dealer, any event shall occur as a result of
which, in the reasonable judgment of the Company or
in your reasonable judgment or in the opinion of
counsel for the Underwriters, it becomes necessary
to amend or supplement the prospectus in order to
make the statements therein, in light of the
circumstances existing at the time the prospectus
is delivered to a purchaser, not misleading, or,
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13
if it is necessary at any time to amend or supplement
the prospectus to comply with any law, the Company
promptly will prepare and file with the Commission
an appropriate amendment to the Registration
Statement or supplement to the prospectus so that
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 law.
(f) The Company will make generally available to its
shareholders and will file as an exhibit in a
report pursuant to the Securities and Exchange Act
of 1934, as amended (the "1934 Act"), as soon as it
is practicable to do so, but in any event not later
than fifteen (15) months after the effective date
of the Registration Statement, an earnings
statement in reasonable detail, covering a period
of at least twelve (12) consecutive months
beginning after the effective date of the
Registration Statement, which earnings statement
shall satisfy the requirements of Section 11(a) of
the Act and Rule 158 of the Rules and Regulations
and will advise the Underwriters in writing when
such statement has been so made available.
(g) The Company will, for a period of five (5) years
from the Closing Date, deliver to the Underwriters
at their principal executive offices a reasonable
number of copies of annual reports, quarterly
reports, current reports and copies of all other
documents, reports and information furnished by the
Company to its stockholders or filed with any
securities exchange pursuant to the requirements of
such exchange or with the Commission pursuant to
the Act or the 1934 Act. The Company will deliver
to the Underwriters similar reports with respect to
any significant subsidiaries, as that term is
defined in the Rules and Regulations, which are not
consolidated in the Company's financial statements.
Any report, document or other information required
to be furnished under this paragraph (g) shall be
furnished as soon as practicable after such report,
document or information becomes available.
(h) The Company will apply the proceeds from the sale
of the Shares as set forth in the description under
"Use of Proceeds" in the Prospectus, which
description complies in all respects with the
requirements of Item 504 of Regulation S-K.
(i) The Company will supply you with copies of all
correspondence to and from, and all documents
issued to and by, the Commission in connection with
the registration of the Shares under the Act.
(j) Prior to the Closing Date (and, if applicable, the
Option Closing Date), the Company will furnish to
you, as soon as they have been prepared, copies of
any unaudited interim financial statements of the
Company and its subsidiaries for any periods
subsequent to the periods covered by the financial
statements appearing in the Registration Statement
and the Prospectus.
(k) Prior to the Closing Date (and, if applicable, the
Option Closing Date), the Company, its
subsidiaries, or any Selling Shareholder will not
issue any press releases or other communications
directly or indirectly and will hold no press
conferences with respect to the Company or any of
its subsidiaries the financial condition, results
of operations, business, properties, assets or
liabilities of the Company or any of its
subsidiaries, or the offering of the Shares,
without your prior written consent.
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(l) The Company will use its best efforts to obtain
approval for, and maintain the quotation of the
Shares on, the National Association of Securities
Dealers, Inc. Automated Quotation/National Market
(the "NNM").
(m) Except pursuant to this Agreement or with the prior
written consent of X.X. Xxxxxxx & Sons, Inc., the
Company will not, and the Company has provided
agreements executed by Xxxx X. Xxxx, as trustee of
The Xxxx X Xxxx Grantor Retained Annuity Trust #1,
Xxxx X. Xxxx, as trustee of The Xxxx X Xxxx Grantor
Retained Annuity Trust #2, Xxxx X. Xxxx, as trustee
of The Xxxx X Xxxx Grantor Retained Annuity Trust
#3, Xxxx X. Xxxx, as trustee of The Xxxx X Xxxx
Grantor Retained Annuity Trust #4, Xxxx X. Xxxx, as
trustee of The Xxxx X Xxxx Grantor Retained Annuity
Trust #5, Xxxx X. Xxxx, as trustee of The Xxxx X
Xxxx Grantor Retained Annuity Trust #6, R. Xxxxx
Xxxxxxx and the personal representative of the
estate of Xxxxx Xxxx providing that none of them
will, and the Company will use its best efforts to
cause its other directors and officers to not, for
a period of 180 days from the Effective Date,
directly or indirectly sell, contract to sell or
otherwise dispose of any shares of the Company's
Common Stock, any securities exchangeable for
Common Stock or any other rights to acquire such
shares without your prior written consent, except
for the Shares sold hereunder and except for sales
of shares of Common Stock to the Company's
employees pursuant to the exercise of options under
the Company's 1997 Stock Option Plan.
(n) For a period of 180 days from the Effective Date,
the Selling Shareholders will not directly or
indirectly sell, contract to sell or otherwise
dispose of any shares of the Company's Common Stock
or rights to acquire such shares without your prior
written consent, except for the Shares sold
hereunder.
(o) The Company and its subsidiaries will maintain and
keep accurate books and records reflecting their
assets and maintain internal accounting controls
which provide reasonable assurance that (i)
transactions are executed in accordance with
management's authorization, (ii) transactions are
recorded as necessary to permit the preparation of
the Company's consolidated financial statements and
to maintain accountability for the assets of the
Company and its subsidiaries, (iii) access to the
assets of the Company and its subsidiaries is
permitted only in accordance with management's
authorization, and (iv) the recorded accounts of
the assets of the Company and its subsidiaries are
compared with existing assets at reasonable
intervals.
6. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The several
obligations of the Underwriters to purchase and pay for the Shares,
as provided herein, shall be subject to the accuracy in all
material respects, as of the date hereof and as of the Closing Date
(and, if applicable, the Option Closing Date), of the
representations and warranties of the Company and the Selling
Shareholders contained herein, to the performance in all material
respects by the Company and the Selling Shareholders of their
covenants and obligations hereunder, and to the following
additional conditions:
(a) All filings required by Rule 424 and Rule 430A of
the Rules and Regulations shall have been made. No
stop order suspending the effectiveness of the
Registration Statement, as amended from time to
time, shall have been issued and no proceeding for
that purpose shall have been initiated or, to the
knowledge of the Company or any Underwriter,
threatened or contemplated by the Commission, and
any request of the Commission for additional
information (to be included in the Registration
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Statement or the Prospectus or otherwise) shall
have been complied with to the reasonable
satisfaction of the Underwriters.
(b) No Underwriter shall have disclosed in writing to
the Company on or prior to the Closing Date (and,
if applicable, the Option Closing Date), that the
Registration Statement or Prospectus or any
amendment or supplement thereto contains an untrue
statement of fact which, in the opinion of counsel
to the Underwriters, is material, or omits to state
a fact which, in the opinion of such counsel, is
material and is required to be stated therein or is
necessary to make the statements therein, in light
of the circumstances under which they were made,
not misleading.
(c) On the Closing Date (and, if applicable, the Option
Closing Date), you shall have received the opinion
of counsel for the Company, addressed to you and
dated the Closing Date (and, if applicable, the
Option Closing Date), to the effect that:
(i) The Company and its subsidiaries have been
duly incorporated and are validly existing
as corporations in good standing under the
laws of the states or jurisdictions in
which they are incorporated with the
corporate power and authority to own,
lease and operate their properties and
conduct their business as described in the
Registration Statement; the Company and
each of its subsidiaries are duly
qualified to do business as foreign
corporations in good standing in the
states listed on Schedule IV attached
hereto and to such counsel's knowledge
such states are the only states or other
jurisdictions in which their ownership or
leasing of property or conduct of business
legally requires such qualification,
except where the failure to be so
qualified would not have a material
adverse effect on the ability of the
Company and its subsidiaries to conduct
their business as described in the
Registration Statement; and the
outstanding shares of capital stock of the
Company's subsidiaries have been duly
authorized and validly issued, are fully
paid and nonassessable and, so far as is
known to such counsel, are owned by the
Company or a subsidiary of the Company
free and clear of any mortgage, pledge,
lien, encumbrance, charge or adverse claim
and are not the subject of any agreement
or understanding with any person; no
options, warrants or other rights to
purchase, agreement or other obligations
to issue or other rights to convert any
obligations into shares of capital stock
or ownership interests in the subsidiaries
are outstanding.
(ii) The Company has duly and validly
authorized capital stock as set forth
under the heading "Capitalization" in the
Prospectus; all outstanding shares of
Common Stock of the Company and the Shares
conform to the description thereof in the
Prospectus under the heading "Description
of Capital Stock", and the outstanding
shares of Common Stock have been duly
authorized and are validly issued, fully
paid and non-assessable; the Shares to be
sold by the Company have been duly
authorized and, when delivered and paid
for in accordance with this Agreement,
will be validly issued, fully paid and
non-assessable, and the shareholders of
the Company have no preemptive rights with
respect to the Shares.
(iii) Such counsel has been advised by the staff
of the Commission that the Registration
Statement has become effective under the
Act and, to the knowledge of such counsel
no stop order suspending the effectiveness
of the
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Registration Statement has been issued and no
proceedings for that purpose have been instituted or
are pending or contemplated under the Act.
(iv) The Registration Statement and the
Prospectus, and each amendment or
supplement thereto, as of their respective
effective or issue dates, comply as to
form and appear on their face to be
appropriately responsive in all material
respects to the requirements of the Act
and the applicable rules and regulations
(except that such counsel need express no
opinion as to the financial statements or
other financial data).
(v) The descriptions in the Registration
Statement and Prospectus of contracts and
other documents filed as exhibits to the
Registration Statement are accurate in all
material respects.
(vi) No authorization, approval, consent,
order, registration or qualification of or
with of any court or governmental body,
authority or agency is required with
respect to the Company in connection with
the transactions contemplated by this
Agreement, except such as may be required
under the Act or the Rules and Regulations
or as may be required by the NASD or under
state securities laws in connection with
the purchase and distribution of the
Shares by the Underwriters.
(vii) The filing of the Registration Statement
has been duly authorized by the Board of
Directors of the Company. This Agreement
has been duly authorized, executed and
delivered by the Company. The performance
of this Agreement and the consummation of
the transactions herein contemplated will
not result in a violation of the Company's
Articles of Incorporation or Bylaws or
result in a breach or violation of any of
the terms and provisions of, or constitute
a default under, or result in the creation
or imposition of any lien, charge or
encumbrance upon any properties or assets
of the Company or any of its subsidiaries
under any statute or under any indenture,
mortgage, deed of trust, note, loan
agreement, sale and leaseback arrangement,
or any other agreement or instrument known
to such counsel to which the Company or
any of its subsidiaries is a party or by
which they are bound or to which any of
the properties or assets of the Company or
any of its subsidiaries is subject, or any
order, rule or regulation known to such
counsel of any court or governmental
agency or body having jurisdiction over
the Company or any of its subsidiaries or
their properties, except, in the case of
any such violation, breach, default,
creation or imposition, to such extent as
does not materially adversely affect the
business of the Company and its
subsidiaries taken as a whole.
(viii) To the knowledge of such counsel, (a)
there are no material (individually, or in
the aggregate) legal, governmental or
regulatory proceedings pending or
threatened to which the Company or any of
its subsidiaries is a party or of which
the business or properties of the Company
or any of its subsidiaries is the subject
which are not disclosed in the
Registration Statement and Prospectus; (b)
there are no contracts or documents of a
character required to be described in the
Registration Statement or the Prospectus
or to be filed as an exhibit to the
Registration Statement which are not
described or filed as required; and
(c) there are no statutes or regulations
required to be
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described in the Registration Statement or Prospectus
which are not described as required.
(ix) To the knowledge of such counsel, the
Company and each of its subsidiaries hold
all licenses, certificates, permits and
approvals from all state, federal and
other regulatory authorities, and have
satisfied in all material respects the
requirements imposed by regulatory bodies,
administrative agencies or other
governmental bodies, agencies or
officials, that are required for the
Company and its subsidiaries lawfully to
own, lease and operate its properties and
conduct its business as described in the
Prospectus, and, to the knowledge of such
counsel, the Company and each of its
subsidiaries are conducting their business
in compliance in all material respects
with all of the laws, rules and
regulations of each jurisdiction in which
they conduct their business.
(x) The statements made in the Registration
Statement under the captions "Dividend
Policy", "Capitalization", and
"Description of Capital Stock", to the
extent that they constitute summaries of
documents referred to therein or matters
of law or legal conclusions, have been
reviewed by such counsel and are accurate
summaries and fairly present the
information disclosed therein.
(xi) The Company and each of its subsidiaries
are not, and will not become as a result
of the consummation of the transactions
contemplated by this Agreement and
application of the net proceeds therefrom
as described in the Prospectus, required
to register as an investment company under
the Investment Company Act of 1940.
(xii) Except as described in the Registration
Statement, there are no contracts,
agreements or understanding known to such
counsel between the Company or any of its
subsidiaries and any person granting such
person the right to require the Company or
any of its subsidiaries to file a
registration statement under the Act with
respect to any securities of the Company
or any of its subsidiaries owned or to be
owned by such person or to require the
Company or any of its subsidiaries to
include such securities in the securities
registered pursuant to the Registration
Statement or in any securities being
registered pursuant to any other
registration statement filed by the
Company under the Act.
(xiii) The Trust is duly organized, validly
existing and in good standing under the
laws of Pennsylvania, and, to the
knowledge of counsel, is not required to
register to do business under the laws of
any other jurisdiction. The Company holds
a 99% beneficial interest in the Trust
free and clear of any mortgage, lien,
encumbrance, charge or adverse claim. No
options or other rights to purchase,
agreement or other obligations to issue or
other rights to convert any obligations
into beneficial interests in the Trust are
outstanding.
(xiv) VNG(DE) is a wholly-owned subsidiary of
the Company. VNG(WV) is a wholly-owned
subsidiary of VNG(DE). Other than VNG(WV)
and VNG(DE), the Company has no
subsidiaries.
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Such counsel also shall confirm that in the course of its
duties in connection with the preparation of the Registration
Statement and Prospectus, nothing came to such counsel's attention
that would lead them to believe that either the Registration
Statement or Prospectus or any amendment or supplement thereto
(other than the financial statements or other financial data as to
which such counsel need express no opinion) contains any untrue
statement of a material fact or omits to state a material fact
required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were
made, not misleading.
In rendering the foregoing opinion, such counsel may
rely, provided that the opinion shall state that you and they are
entitled to so rely, (a) as to matters involving laws of any
jurisdiction other than Missouri, the United States or the Business
Corporation Law of the Commonwealth of Pennsylvania, upon opinions
addressed to the Underwriters of other counsel satisfactory to them
and Peper, Martin, Xxxxxx, Xxxxxxx and Hetlage, and (b) as to all
matters of fact, upon certificates and written statements of the
executive officers of, and accountants for, the Company.
(d) On the Closing Date (and, if applicable, the Option
Closing Date), you shall have received the opinion
of counsel to the Selling Shareholders, addressed
to you and dated the Closing Date (and, if
applicable, the Option Closing Date), to the effect
that:
(i) Each Selling Shareholder has duly
authorized, executed and delivered the
Custody Agreement and Power of Attorney,
appointing Xxxx X. Xxxx and Xxxxxxxx X.
Xxxxx as such Selling Shareholder's
Custodians with authority to take custody
of and deliver the Shares as represented
by certificates on behalf of such Selling
Shareholder in connection with the
transactions contemplated by this
Agreement and the Custody Agreement and
appointing Xxxx X. Xxxx and Xxxxxxxx X.
Xxxxx as such Selling Shareholder's
attorneys-in-fact with authority to
execute and deliver this Agreement on
behalf of such Selling Shareholder and
otherwise to act on behalf of such Selling
Shareholder in connection with the
transactions contemplated by this
Agreement and the Power of Attorney.
(ii) This Agreement has been duly authorized,
executed and delivered on behalf of the
Selling Shareholders.
(iii) Each Selling Shareholder has full legal
right, power and authority to sell,
assign, transfer and deliver the Shares to
be sold by such Selling Shareholder.
(iv) Each Selling Shareholder (assuming the
underwriters are bona fide purchasers
within the meaning of the Uniform
Commercial Code) has transferred to the
Underwriters good and valid title to the
Shares being sold by such Selling
Shareholder on the Closing Date (and, if
applicable, the Option Closing Date), free
and clear of all liens, mortgages,
pledges, encumbrances, claims, equities
and security interests whatsoever.
In rendering the foregoing opinion, such counsel may
rely, provided that the opinion shall state that you and they are
entitled to so rely, (a) as to matters involving laws of any
jurisdiction other than Missouri or the United States, upon
opinions addressed to the Underwriters of other counsel
satisfactory to them and Peper, Martin, Xxxxxx, Xxxxxxx and
Hetlage, and (b) as to all matters of fact, upon certificates and
written statements of the Selling Shareholders.
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(e) You shall have received on the Closing Date (and,
if applicable, the Option Closing Date), from
Peper, Martin, Xxxxxx, Xxxxxxx and Xxxxxxx, counsel
to the Underwriters, such opinion or opinions,
dated the Closing Date (and, if applicable, the
Option Closing Date) with respect to the
incorporation of the Company, the validity of the
Shares, the Registration Statement, the Prospectus
and other related matters as you may reasonably
require; the Company and Selling Shareholders shall
have furnished to such counsel such documents as
they reasonably request for the purpose of enabling
them to pass on such matters.
(f) You shall have received at or prior to the Closing
Date from Peper, Martin, Xxxxxx, Xxxxxxx and
Hetlage a memorandum or memoranda, in form and
substance satisfactory to you, with respect to the
qualification for offering and sale by the
Underwriters of the Shares under state securities
laws of such jurisdictions as the Underwriters may
have designated to the Company.
(g) On the date of this Agreement and on the Closing
Date (and, if applicable, the Option Closing Date),
you shall have received from Xxxxxx Xxxxxxxx LLP, a
letter or letters, dated the date of this Agreement
and the Closing Date (and, if applicable, the
Option Closing Date), respectively, in form and
substance satisfactory to you, confirming that they
are independent public accountants with respect to
the Company within the meaning of the Act and the
published Rules and Regulations, and the answer to
Item 509 of Regulation S-K set forth in the
Registration Statement is correct insofar as it
relates to them, and addressing the matters set
forth in Schedule III hereto.
(h) Except as contemplated in the Prospectus,
(i) neither the Company nor any of its subsidiaries
shall have sustained since the date of the latest
audited financial statements included in the
Prospectus any loss or interference with its
business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or
from any labor dispute or court or governmental
action, order or decree; and (ii) subsequent to the
respective dates as of which information is given
in the Registration Statement and the Prospectus,
neither the Company nor any of its subsidiaries
shall have incurred any liability or obligation,
direct or contingent, or entered into transactions,
and there shall not have been any change in the
capital stock or long-term debt of the Company or
any of its subsidiaries or any change in the
condition (financial or other), net worth,
business, affairs, management, prospects or results
of operations of the Company or any of its
subsidiaries, the effect of which, in any such case
described in clause (i) or (ii), is in your
judgment so material or adverse as to make it
impracticable or inadvisable to proceed with the
public offering or the delivery of the Shares being
delivered on such Closing Date (and, if applicable,
the Option Closing Date) on the terms and in the
manner contemplated in the Prospectus.
(i) On or after the date hereof, there shall not 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
American Stock Exchange; (ii) a general moratorium
on commercial banking activities in New York
declared by either federal or state authorities;
(iii) the outbreak or escalation of hostilities
involving or affecting the United States or the
declaration by the United States of a national
emergency or war, if the effect of any such event
specified in this clause (iii) in your judgment
makes it impracticable or inadvisable to proceed
with the public offering or the delivery of the
Shares in the manner contemplated in the
Prospectus; (iv) any substantial
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calamity or crisis, change in national, international or world
affairs, act of God, material change in the
international or domestic markets, or adverse
change in the existing financial, political or
economic conditions in the United States or
elsewhere, if the effect of any such event
specified in this clause (iv) makes it
impracticable or inadvisable to proceed with the
public offering or the delivery of the Shares in
the manner contemplated in the Prospectus; or
(v) the enactment, publication, decree, or other
promulgation of any federal or state statute,
regulation, rule, or order of any court or other
governmental authority, or the taking of any action
by any federal, state or local government or agency
in respect of fiscal or monetary affairs, if the
effect of any such event specified in this
clause (v) in your judgment makes it impracticable
or inadvisable to proceed with the public offering
or the delivery of the Shares in the manner
contemplated in the Prospectus.
(j) You shall have received certificates, dated the
Closing Date (and, if applicable, the Option
Closing Date) and signed by the President and the
Chief Financial Officer of the Company stating that
(i) they have carefully examined the Registration
Statement and the Prospectus as amended or
supplemented and nothing has come to their
attention that would lead them to believe that
either the Registration Statement or the
Prospectus, or any amendment or supplement thereto
as of their respective effective or issue dates,
contained, and the Prospectus as amended or
supplemented at such Closing Date, contains any
untrue statement of a material fact, or omits to
state a material fact required to be stated therein
or necessary in order to make the statements
therein, in light of the circumstances under which
they were made, not misleading, and, that (ii) all
representations and warranties made herein by the
Company are true and correct in all material
respects at such Closing Date, with the same effect
as if made on and as of such Closing Date, and all
agreements herein to be performed by the Company on
or prior to such Closing Date have been duly
performed in all material respects.
(k) The Company and the Selling Shareholders shall have
furnished to you at the Closing Date (and, if
applicable, the Option Closing Date) such other
certificates as you may have reasonably requested
as to the accuracy, on and as of such Closing Date,
of the representations and warranties of the
Company and the Selling Shareholders herein and as
to the performance by the Company and the Selling
Shareholders of their obligations hereunder.
(l) The Shares shall have been approved for trading
upon official notice of issuance on the NNM.
(m) The NASD shall not have raised any objection with
respect to the fairness and reasonableness of the
underwriting terms and arrangements.
(n) The agreements mentioned in Section 5(m) shall be
in full force and effect.
All such opinions, certificates, letters and documents
will be in compliance with the provisions hereof only if they are
reasonably satisfactory to you and to Peper, Martin, Xxxxxx,
Xxxxxxx and Xxxxxxx, counsel for the several Underwriters. The
Company and Selling Shareholders will furnish you with such
conformed copies of such opinions, certificates, letters and
documents as you may request.
If any of the conditions specified above in this Section
6 shall not have been satisfied at or prior to the Closing Date
(and, if applicable, the Option Closing Date) or waived by you in
writing, this Agreement may be terminated by you on notice to the
Company and the Selling Shareholders.
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7. INDEMNIFICATION.
(a) The Company will indemnify and hold harmless each
Underwriter and each person, if any, who controls
any Underwriter within the meaning of the Act,
against any losses, claims, damages or liabilities,
joint or several, to which such Underwriter or such
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 an untrue
statement or alleged untrue statement of a material
fact contained in the Registration Statement, any
Preliminary Prospectus, the Prospectus, or any
amendment or supplement thereto, 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, in light of the circumstances under which
they were made, not misleading; and will reimburse
each Underwriter and each such controlling person
for any reasonable legal or other expenses incurred
by such Underwriter or such controlling person in
connection with investigating or defending any such
loss, claim, damage, liability or action; 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
the Registration Statement, such Preliminary
Prospectus or the Prospectus, or such amendment or
supplement, in reliance upon and in conformity with
written information furnished to the Company by you
or by any Underwriter through you, specifically for
use in the preparation thereof; and provided,
further, that if any Preliminary Prospectus or the
Prospectus contained any alleged untrue statement
or allegedly omitted to state therein a material
fact required to be stated therein or necessary to
make the statements therein not misleading and such
statement or omission shall have been corrected in
a revised Preliminary Prospectus or in the
Prospectus or in an amended or supplemented
Prospectus, the Company shall not be liable to any
Underwriter or controlling person under this
subsection (a) with respect to such alleged untrue
statement or alleged omission to the extent that
any such loss, claim, damage or liability of such
Underwriter or controlling person results from the
fact that such Underwriter sold Shares to a person
to whom there was not sent or given, at or prior to
the written confirmation of such sale, such revised
Preliminary Prospectus or Prospectus or amended or
supplemented Prospectus. This indemnity agreement
shall be in addition to any liabilities which the
Company may otherwise have.
(b) Each Selling Shareholder will indemnify and hold
harmless each Underwriter and each person, if any,
who controls any Underwriter within the meaning of
the Act, against any losses, claims, damages or
liabilities, joint or several, to which such
Underwriter 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 any material fact contained in the
Registration Statement, any Preliminary Prospectus,
the Prospectus, or any amendment or supplement
thereto, or arise out of or are based upon the
omission or the alleged omission to state therein a
material fact required to be stated therein or
necessary to make the statements therein not
misleading, 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 the Registration Statement, such
Preliminary Prospectus or the Prospectus, or such
amendment or supplement, in reliance upon and in
conformity with written information furnished to
the Company or any Underwriter by such Selling
Shareholder specifically for use in the preparation
thereof; and will reimburse any
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reasonable legal or other expenses incurred by each Underwriter
and each person, if any, who controls any Underwriter
within the meaning of the Act, in connection with
investigating or defending any such loss, claim,
damage, liability or action; provided, however,
that the indemnity contained in this subsection (b)
with respect to any Preliminary Prospectus shall
not inure to the benefit of any Underwriter (or to
the benefit of any person controlling such
Underwriter) in respect of any action or claim
asserted by a person who purchased any Shares from
such Underwriter, if, within the time required by
the Act such person was not sent or given a copy of
the Prospectus, as then amended or supplemented.
In no event, however, shall the liability of any
Selling Shareholder for indemnification under this
Section 7(b) exceed the proceeds received by such
Selling Shareholder from the Underwriters in the
offering. This indemnity agreement shall be in
addition to any liabilities which the Selling
Shareholders may otherwise have.
(c) Each Underwriter will indemnify and hold harmless
the Company, each of its directors, each of its
officers who have signed the Registration Statement
and, each person, if any, who controls the Company
within the meaning of the Act, and each Selling
Shareholder, against any losses, claims, damages or
liabilities, joint or several, to which the Company
or any such director, officer or controlling person
or any such Selling Shareholder 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 any
material fact contained in the Registration
Statement, any Preliminary Prospectus, the
Prospectus, any amendment or supplement thereto, or
arise out of or are based upon the omission or the
alleged omission to state therein a material fact
required to be stated therein or necessary to make
the statements therein, in light of the
circumstances under which they were made, 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 the Registration Statement, such
Preliminary Prospectus or the Prospectus, such
amendment or supplement, in reliance upon and in
conformity with written information furnished to
the Company by any such Underwriter specifically
for use in the preparation thereof; and will
reimburse any reasonable legal or other expenses
incurred by the Company or any such director,
officer or controlling person or any such Selling
Shareholder in connection with investigating or
defending any such loss, claim, damage, liability
or action. The Company and each Selling
Shareholder acknowledge that the statements set
forth under the heading "Underwriting" in any
Preliminary Prospectus and the Prospectus
constitute the only information relating to the
Underwriters furnished in writing to the Company by
the Underwriters expressly for inclusion in the
Registration Statement, any Preliminary Prospectus
or the Prospectus. This indemnity agreement shall
be in addition to any liabilities which the
Underwriters may otherwise have.
(d) Any party which proposes to assert the right to be
indemnified under this Section 7 shall, within ten
(10) days after receipt of notice of commencement
of any action, suit or proceeding against such
party in respect of which a claim is to be made
against an indemnifying party under this Section 7,
notify each such indemnifying party of the
commencement of such action, suit or proceeding,
enclosing a copy of all papers served, but the
omission so to notify such indemnifying party of
any such action, suit or proceeding shall not
relieve such indemnifying party from any liability
which it may have to any indemnified party
otherwise than under this Section 7. In case any
such action, suit or proceeding shall be brought
against any indemnified
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party and it shall notify the indemnifying party of the
commencement thereof, the indemnifying party shall be entitled
to participate in, and, to the extent that it shall
wish, jointly with any other indemnifying party,
similarly notified, to assume the defense thereof,
with counsel reasonably satisfactory to such
indemnified party, and after notice from the
indemnifying party to such indemnified party of its
election so to assume the defense thereof, the
indemnifying party shall not be liable to such
indemnified party for any legal or other expenses,
other than reasonable costs of investigation,
subsequently incurred by such indemnified party in
connection with the defense thereof. The
indemnified party shall have the right to employ
its own counsel in any such action, but the fees
and expenses of such counsel shall be at the
expense of such indemnified party unless (i) the
employment of counsel by such indemnified party at
the expense of the indemnifying party has been
authorized by the indemnifying party, (ii) the
indemnified party shall have been advised by such
counsel in a written opinion that there may be a
conflict of interest between the indemnifying party
and the indemnified party in the conduct of the
defense, or certain aspects of the defense, of such
action (in which case the indemnifying party shall
not have the right to direct the defense of such
action with respect to those matters or aspects of
the defense on which a conflict exists or may exist
on behalf of the indemnified party) or (iii) the
indemnifying party shall not in fact have employed
counsel to assume the defense of such action, in
any of which events such fees and expenses to the
extent applicable shall be borne by the
indemnifying party. An indemnifying party shall
not be liable for any settlement of any action or
claim effected without its consent, provided that
such consent in not unreasonably withheld or
delayed. Each indemnified party, as a condition of
such indemnity, shall cooperate in good faith with
the indemnifying party in the defense of any such
action or claim. In no event shall an indemnifying
party be liable for the fees and expenses of more
than one counsel (in addition to any local counsel,
not more than one per state), apart from counsel to
such indemnifying party, for all indemnified
parties in connection with any one action or
separate by similar or related actions arising out
of the same general allegations or circumstances.
(e) If the indemnification provided for in this Section
7 is for any reason, other than pursuant to the
terms thereof, judicially determined (by the entry
of a final judgment or decree by a court of
competent jurisdiction and the expiration of time
to appeal or the denial of the last right to
appeal) to be unavailable to an indemnified party
under subsections (a), (b) or (c) above in respect
of any losses, claims, damages or liabilities (or
actions in respect thereof) referred to therein,
then each indemnifying party shall, in lieu of
indemnifying such indemnified party, 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, the
Selling Shareholders and the Underwriters from the
offering of the Shares. If, however, the
allocation provided by the immediately preceding
sentence is not permitted by applicable law or the
indemnified party failed to give notice under
Section 7(d), 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, as
applicable, of the Company, the Selling
Shareholders and the Underwriters in connection
with the statements or omissions which resulted in
such losses, claims, damages or liabilities (or
actions in respect thereof), as well as other
relevant equitable considerations. The relative
benefits received by, as applicable, the Company,
the Selling Shareholders and the Underwriters shall
be deemed to be in the same proportion as the total
net proceeds
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from the offering (before deducting expenses) received by the
Company and the Selling Shareholders bear to the total
underwriting discounts and commissions received by the
Underwriters, in each case as set forth in the
table on the cover page of the Prospectus. The
relative fault shall be determined by reference to,
among other things, whether the untrue statement of
a material fact or the omission or alleged omission
to state a material fact relates to information
supplied by the Company, the Selling Shareholders
or the Underwriters and the parties' relative
intent, knowledge, access to information and
opportunity to correct or prevent such statement or
omission. The Company, the Selling Shareholders
and the Underwriters agree that it would not be
just and equitable if contributions pursuant to
this subsection (e) 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 subsection (e). The amount paid or payable by
an indemnified party as a result of the losses,
claims, damages or liabilities (or actions in
respect thereof) referred to above in this
subsection (e) 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
(e): no Underwriter shall be required to contribute
any amount in excess of the underwriting discounts
and commissions applicable to the Shares purchased
by such Underwriter; no Selling Shareholder shall
be required to contribute any amount in excess of
the proceeds received by such Selling Shareholder
from the Underwriters in the offering; and, 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
in this subsection (e) to contribute are several in
proportion to their respective underwriting
obligations and not joint.
8. REPRESENTATIONS AND AGREEMENTS TO SURVIVE DELIVERY. All
representations, warranties, and agreements of the Company and the
Selling Shareholders contained in Sections 7 and 11 herein or in
certificates delivered pursuant hereto, and the agreements of the
Underwriters contained in Section 7 hereof, shall remain operative
and in full force and effect regardless of any termination or
cancellation of this Agreement or any investigation made by or on
behalf of any Underwriter or any controlling person, the Company or
any of its officers, directors or any controlling persons, or the
Selling Shareholders, and shall survive delivery of the Shares to
the Underwriters hereunder.
9. SUBSTITUTION OF UNDERWRITERS.
(a) If any Underwriter shall default in its obligation
to purchase the Shares which it has agreed to
purchase hereunder, you may in your discretion
arrange for you or another party or other parties
to purchase such Shares on the terms contained
herein. If within thirty-six (36) hours after such
default by any Underwriter you do not arrange for
the purchase of such Shares, then the Company and
the Selling Shareholders shall be entitled to a
further period of thirty-six (36) hours within
which to procure another party or parties
reasonably satisfactory to you to purchase such
Shares on such terms. In the event that, within
the respective prescribed periods, you notify the
Company and the Selling Shareholders that you have
so arranged for the purchase of such Shares, or the
Company and the Selling Shareholders notify you
that they have so arranged for the purchase of such
Shares, you or the Company and the Selling
Shareholders shall have the right to postpone the
Closing Date for a period of not more than seven
(7) days, in order to effect whatever changes may
thereby be made necessary in the Registration
Statement or the Prospectus, or in any
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other documents or arrangements, and the Company agrees
to file promptly any amendments to the Registration
Statement or the Prospectus which in your opinion
may thereby be made necessary. The term
"Underwriter" as used in this Agreement shall
include any persons substituted under this Section
9 with like effect as if such person had originally
been a party to this Agreement with respect to such
Shares.
(b) If, after giving effect to any arrangements for the
purchase of the Shares of a defaulting Underwriter
or Underwriters made by you or the Company and the
Selling Shareholders as provided in subsection (a)
above, the aggregate number of Shares which remains
unpurchased does not exceed one tenth (1/10) of the
total Shares to be sold on the Closing Date, then
the Company and the Selling Shareholders shall have
the right to require each non-defaulting
Underwriter to purchase the Shares which such
Underwriter agreed to purchase hereunder and, in
addition, to require each non-defaulting
Underwriter to purchase its pro rata share (based
on the number of Shares which such Underwriter
agreed to purchase hereunder) of the Shares of such
defaulting Underwriter or Underwriters for which
such arrangements have not been made; but nothing
herein shall relieve a defaulting Underwriter from
liability for its default.
(c) If, after giving effect to any arrangements for the
purchase of the Shares of a defaulting Underwriter
or Underwriters made by you or the Company and the
Selling Shareholders as provided in subsection (a)
above, the number of Shares which remains
unpurchased exceeds one tenth (1/10) of the total
Shares to be sold on the Closing Date, or if the
Company and the Selling Shareholders shall not
exercise the right described in subsection (b)
above to require the non-defaulting Underwriters to
purchase Shares of the defaulting Underwriter or
Underwriters, then this Agreement shall thereupon
terminate, without liability on the part of any
non-defaulting Underwriter or the Company and the
Selling Shareholders except for the expenses to be
borne by the Company and the Underwriters as
provided in Section 11 hereof and the indemnity and
contribution agreements in Section 7 hereof; but
nothing herein shall relieve a defaulting
Underwriter from liability for its default.
10. EFFECTIVE DATE AND TERMINATION.
(a) This Agreement shall become effective at 1:00 p.m.,
St. Louis time, on the first business day following
the effective date of the Registration Statement,
or at such earlier time after the effective date of
the Registration Statement as you in your
discretion shall first release the Shares for
offering to the public; provided, however, that the
provisions of Section 7 and 11 shall at all times
be effective. For the purposes of this Section
10(a), the Shares shall be deemed to have been
released to the public upon release by you of the
publication of a newspaper advertisement relating
to the Shares or upon release of telegrams,
facsimile transmissions or letters offering the
Shares for sale to securities dealers, whichever
shall first occur.
(b) This Agreement may be terminated by you at any time
before it becomes effective in accordance with
Section 10(a) by notice to the Company and the
Selling Shareholders; provided, however, that the
provisions of this Section 10 and of Section 7 and
Section 11 hereof shall at all times be effective.
In the event of any termination of this Agreement
pursuant to Section 9 or this Section 10(b) hereof,
the Company and the Selling Shareholders shall not
then be under any liability to any Underwriter
except as provided in Section 7 or Section 11
hereof.
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(c) This Agreement may be terminated by you at any time
at or prior to the Closing Date by notice to the
Company and the Selling Shareholders if any
condition specified in Section 6 hereof shall not
have been satisfied on or prior to the Closing
Date. Any such termination shall be without
liability of any party to any other party except as
provided in Sections 7 and 11 hereof.
(d) This Agreement also may be terminated by you, by
notice to the Company and the Selling
Shareholders, as to any obligation of the
Underwriters to purchase the Option Shares, if any
condition specified in Section 6 hereof shall not
have been satisfied at or prior to the Option
Closing Date or as provided in Section 9 of this
Agreement.
If you terminate this Agreement as provided in Sections
10(b), 10(c) or 10(d), you shall notify the Company and the Selling
Shareholders by telephone or telegram, confirmed by letter.
11. COSTS AND EXPENSES. The Company will bear and pay the
costs and expenses incident to the registration of the Shares and
public offering thereof, including, without limitation, (a) the
fees and expenses of the Company's accountants and the fees and
expenses of counsel for the Company and the Selling Shareholders,
(b) the preparation, printing, filing, delivery and shipping of
the Registration Statement, each Preliminary Prospectus, the
Prospectus and any amendments or supplements thereto (except as
otherwise expressly provided in Section 5(d) hereof) and the
printing, delivery and shipping of this Agreement, the Agreement
Among Underwriters, the Selected Dealer Agreement, Underwriters'
Questionnaires and Powers of Attorney and Blue Sky Memoranda,
(c) the furnishing of copies of such documents (except as otherwise
expressly provided in Section 5(d) hereof) to the Underwriters,
(d) the qualification of the Shares for offering and sale under the
securities laws of the various states and in connection with
qualification under NASD regulations, (e) the fees payable to the
NASD and the Commission in connection with their review of the
proposed offering of the Shares, (f) all printing and engraving
costs related to preparation of the certificates for the Shares,
including transfer agent and registrar fees, (g) all initial
transfer taxes, if any, imposed on the sale of the Shares to the
Underwriters, (h) all fees and expenses relating to the
authorization of the Shares for trading on NNM, (i) all travel
expenses, including air fare and accommodation expenses, of
representatives of the Company in connection with the offering of
the Shares and (j) all of the other costs and expenses incident to
the performance by the Company and Selling Shareholders of the
registration and offering of the Shares; provided, however, that
the Underwriters will bear and pay the fees and expenses of the
Underwriters' counsel (other than fees and disbursements relating
to the qualification of the Shares for offering and sale under the
securities laws of the various states and qualifications under NASD
regulations), the Underwriters' out-of-pocket expenses, and any
advertising costs and expenses incurred by the Underwriters
incident to the public offering of the Shares.
If this Agreement is terminated by you in accordance with
the provisions of Section 10(c), the Company shall reimburse the
Underwriters for all of their out-of-pocket expenses, including the
reasonable fees and disbursements of counsel to the Underwriters.
12. DEFAULT OF SELLING SHAREHOLDERS. Failure or refusal by
any of the Selling Shareholders to sell and deliver on the Closing
Date the Shares agreed to be sold and delivered by such Selling
Shareholder shall in no manner relieve the other Selling
Shareholders or the Company of their respective obligations under
this Agreement. If any Selling Shareholder should fail or refuse
to sell and deliver his Shares, the remaining Selling Shareholders
shall have the right hereby granted to increase, pro rata or
otherwise, the number of Shares to be sold by them hereunder to the
total number of Shares to be sold by all Selling Shareholders as
set forth in Schedule I. If the remaining Selling Shareholders do
not fully exercise the right to increase the number of Shares to be
sold by them, the Underwriters, at your option, will have the right
to elect to purchase or not to purchase the Shares to be sold by
the Company and the remaining Selling Shareholders. In the event
the Underwriters purchase the Shares of the Company and such other
Selling Shareholders pursuant to this Section 12, the Closing Date
shall be postponed for a period of not more than seven days in
order that the
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Registration Statement and Prospectus or other documents may be amended or
supplemented to the extent necessary under the provisions of the Act and the
Rules and Regulations or under the securities laws of any jurisdiction. If
the Underwriters determine not to purchase the Shares of the Company and the
other Selling Shareholders, if any, this Agreement shall terminate and
neither the Company nor the Underwriters nor any other Selling
Shareholder shall be under any obligation under this Agreement
except as provided in Section 7 hereof and except for the
obligation of the Company to pay for such expenses as are set forth
in Section 11 hereof. Nothing herein shall relieve a defaulting
Selling Shareholder from liability for his default or from
liability under Section 7 hereof or for expenses imposed by this
Agreement upon such Selling Shareholder.
13. NOTICES. All notices or communications hereunder, except
as herein otherwise specifically provided, shall be in writing and
if sent to the Underwriters shall be mailed, delivered, sent by
facsimile transmission, or telegraphed and confirmed c/o X.X.
Xxxxxxx & Sons, Inc. at Xxx Xxxxx Xxxxxxxxx Xxxxxx, Xx. Xxxxx,
Xxxxxxxx 00000, Attention: Syndicate, facsimile number (314) 955-
7387, or if sent to the Company shall be mailed, delivered, sent by
facsimile transmission, or telegraphed and confirmed to the Company
at 00 00xx Xxxxxx, Xxxxxxxx, Xxxx Xxxxxxxx 00000, Attention:
Xxxxxxxx X. Xxxxx, facsimile number (000) 000-0000, or if sent to
any Selling Shareholder shall be mailed, delivered, sent by
facsimile transmission or telegraphed and confirmed to such Selling
Shareholder, c/o the Attorney-in-Fact at the Company's address set
forth above. Notice to any Underwriter pursuant to Section 7 shall
be mailed, delivered, sent by facsimile transmission, or
telegraphed and confirmed to such Underwriter's address as it
appears in the Underwriters' Questionnaire furnished in connection
with the offering of the Shares or as otherwise furnished to the
Company and the Selling Shareholder.
14. PARTIES. This Agreement shall inure to the benefit of
and be binding upon the Underwriters and the Selling Shareholders,
and the Company and their respective successors and assigns.
Nothing expressed or mentioned in this Agreement is intended or
shall be construed to give any person, corporation or other entity,
other than the parties hereto and their respective successors and
assigns and the controlling persons, officers and directors
referred to in Section 7, 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
being intended to be and being for the sole and exclusive benefit
of the parties hereto and their respective successors and assigns
and said controlling persons and said officers and directors, and
for the benefit of no other person, corporation or other entity.
No purchaser of any of the Shares from any Underwriter shall be
construed a successor or assign by reason merely of such purchase.
In all dealings with the Company and the Selling
Shareholders under this Agreement you shall act on behalf of each
of the several Underwriters. The Company and the Selling
Shareholders shall be entitled to act and rely upon any statement,
request, notice or agreement on behalf of the Underwriters, made or
given by you on behalf of the Underwriters, as if the same shall
have been made or given in writing by the Underwriters.
15. COUNTERPARTS. This Agreement may be executed by any one
or more of the parties hereto 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.
16. PRONOUNS. Whenever a pronoun of any gender or number is
used herein, it shall, where appropriate, be deemed to include any
other gender and number.
17. APPLICABLE LAW. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of Missouri.
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If the foregoing is in accordance with your
understanding, please so indicate in the space provided below for
that purpose, whereupon this letter shall constitute a binding
agreement among the Company, each of the Selling Shareholders and
the Underwriters.
VALLEY NATIONAL GASES INCORPORATED
By:------------------------------------
Title: President
Selling Shareholders Named in
Schedule I Hereto
By:------------------------------------
Attorney-in-Fact
Accepted in St. Louis, Missouri as
of the date first above written, on behalf
of ourselves and each of the several
Underwriters named in Schedule II hereto.
X.X. XXXXXXX & SONS, INC.
XXXXXXXXXXX & CO., INC.
By: X.X. Xxxxxxx & Sons, Inc.
By:--------------------------------
Title: Senior Vice President
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SCHEDULE I
Number of
Selling Shareholders Firm Shares
-------------------- -----------
Xxxxxxxx X. Xxxxx 37,000
Xxxx X. Xxxxxxxx 15,000
Xxxxxxx X. Xxxxxxxxxx 30,000
Total 82,000
======
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SCHEDULE II
Name Number of Shares
---- ----------------
X.X. Xxxxxxx & Sons, Inc. ----------
Xxxxxxxxxxx & Co., Inc. ----------
--------------------------- ----------
--------------------------- ----------
--------------------------- ----------
--------------------------- ----------
--------------------------- ----------
--------------------------- ----------
--------------------------- ----------
--------------------------- ----------
--------------------------- ----------
--------------------------- ----------
--------------------------- ----------
--------------------------- ----------
--------------------------- ----------
--------------------------- ----------
Total ----------
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SCHEDULE III
Pursuant to Section 6(g) of the Underwriting Agreement, Xxxxxx
Xxxxxxxx LLP shall furnish letters to the Underwriters to the
effect that:
1. In their opinion, the financial statements and any
supplementary financial information and schedules audited
(including pro forma financial information examined) by them and
included in the Prospectus or the Registration Statement comply as
to form in all material respects with the applicable accounting
requirements of the Act and the applicable Rules and Regulations
thereunder; and, if applicable, they have made a review in
accordance with standards established by the American Institute of
Certified Public Accountants of the unaudited interim financial
statements, selected financial data, pro forma financial
information, or condensed financial statements derived from audited
financial statements of the Company and its subsidiaries for the
periods specified in such letter, as indicated in their reports
thereon, copies of which have been furnished to the Representatives
of the Underwriters (the "Representatives").
2. On the basis of limited procedures, not constituting an
audit in accordance with generally accepted auditing standards,
consisting of a reading of the unaudited financial statements and
other information referred to below, performing the procedures
specified by the AICPA for a review of interim financial
information as discussed in SAS No. 71, Interim Financial
Information, on the latest available interim financial statements
of the Company, its subsidiaries and Weldco, Inc., inspection of
the minute books of the Company, its subsidiaries and Weldco, Inc.
since the date of the latest audited financial statements included
in the Prospectus, inquiries of officials of the Company, its
subsidiaries and Weldco, Inc. 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) any material modifications should be made to the
unaudited balance sheet statements of operations,
statements of cash flows, and statements of changes
in Shareholder's equity included in the Prospectus
for them to be in conformity with generally
accepted accounting principles, or such unaudited
statements, included in the Prospectus do not
comply as to form in all material respects with the
applicable accounting requirements of the Act and
the related published Rules and Regulations
thereunder.
(b) any other unaudited income statement data and
balance sheet items included in the Prospectus do
not agree with the corresponding items in the
unaudited consolidated financial statements from
which such data and items were derived, and any
such unaudited data and items were not determined
on a basis substantially consistent with the basis
for the corresponding amounts in the audited
consolidated financial statements included in the
Prospectus.
(c) the unaudited financial statements which were not
included in the Prospectus but from which were
derived any unaudited condensed financial
statements referred to in Clause (a) and any
unaudited income statement data and balance sheet
items included in the Prospectus and referred to in
Clause (b) were not determined on a basis
substantially consistent with the basis for the
audited consolidated financial statements included
in the Prospectus.
(d) any unaudited pro forma condensed financial
statements included in the Prospectus do not comply
as to form in all material respects with the
applicable accounting requirements of the Act and
the published rules and regulations thereunder or
the pro
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forma adjustments have not been properly applied to the
historical amounts in the compilation of those statements.
(e) as of a specified date not more than five (5) days
prior to the date of such letter, there have been
any changes in the capital stock or any increase in
the long-term debt of the Company or any of its
subsidiaries, or any decreases in working capital,
net current assets or net assets or other items
specified by the Representatives, or any changes in
any items specified by the Representatives, in each
case as compared with amounts shown in the latest
balance sheet included in the Prospectus, except in
each case for changes, increases or decreases which
the Prospectus discloses have occurred or may occur
or which are described in such letter.
(f) for the period from the date of the latest
financial statements included in the Prospectus to
the specified date referred to in Clause (e) there
were any decreases in net sales or income from
operations or the total or pro forma per share
amounts of net income or any other changes in any
other items specified by the Representatives, in
each case as compared with the comparable period of
the preceding year and with any other period of
corresponding length specified by the
Representatives, except in each case for changes,
decreases or increases which the Prospectus
discloses have occurred or may occur or which are
described in such letter.
3. In addition to the audit referred to in their report(s)
included in the Prospectus and the limited procedures, inspection
of minute books, inquiries and other procedures referred to in
paragraph (3) 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 specified by the
Representatives, which are derived from the general accounting
records of the Company and its subsidiaries for the periods covered
by their reports and any interim or other periods since the latest
period covered by their reports, which appear in the Prospectus, or
in Part II of, or in exhibits and schedules to, the Registration
Statement specified by the Representatives, and have compared
certain of such amounts, percentages and financial information with
the accounting records of the Company and its subsidiaries and have
found them to be in agreement.
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SCHEDULE IV
States in which Valley National Gases Incorporated is duly
qualified to do business as a foreign corporation:
NONE
States in which Valley National Gases Delaware, Inc. is duly qualified
to do business as a foreign corporation:
NONE
State in which Valley National Gases, Inc. is duly qualified to do
business as a foreign corporation:
Delaware
Kentucky
Maryland
North Carolina
Ohio
Pennsylvania
Tennessee
Virginia
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