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EXHIBIT 1.1
Form of Underwriting Agreement
S&C Draft of March 18, 1999
TELEBANC FINANCIAL CORPORATION
COMMON STOCK (PAR VALUE $.01 PER SHARE)
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UNDERWRITING AGREEMENT
(U.S. VERSION)
....................., 1999
Xxxxxxx, Xxxxx & Co.,
BancBoston Xxxxxxxxx Xxxxxxxx Inc.,
Xxxx Xxxxx Xxxx Xxxxxx, Incorporated,
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated,
c/o Goldman, Sachs & Co.,
00 Xxxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000.
Ladies and Gentlemen:
TeleBanc Financial Corporation, a Delaware corporation (the
"Company"), proposes, subject to the terms and conditions stated herein, to
issue and sell to the Underwriters named in Schedule I hereto (the
"Underwriters") an aggregate of . . . . . . .shares and, at the election of
the Underwriters, up to . . . . . . additional shares of Common Stock, par
value $.01 per share ("Stock"), of the Company, and the stockholders of the
Company named in Schedule II hereto (the "Selling Stockholders") propose,
subject to the terms and conditions stated herein, to sell to the Underwriters
an aggregate of . . . . . . . shares of Stock. The aggregate of . . . . shares
to be sold by the Company and the Selling Stockholders is herein called the
"Firm Shares", and the aggregate of . . . . . additional shares to be sold by
the Company is herein called the "Optional Shares". The Firm Shares and the
Optional Shares that the Underwriters elect to purchase pursuant to Section 2
hereof are herein collectively called the "Shares".
It is understood and agreed to by all parties that the Company
and the Selling Stockholders are concurrently entering into an agreement (the
"International Underwriting Agreement") providing for the sale by the Company
and the Selling Stockholders of up to a total of ______ shares of Stock (the
"International Shares"), including the overallotment option thereunder, through
arrangements with certain underwriters outside the United States (the
"International Underwriters"), for whom Xxxxxxx Xxxxx International is acting as
the lead manager. Anything herein or therein to the contrary notwithstanding,
the respective closings under this Agreement and the International Underwriting
Agreement are hereby expressly made conditional on one another. The
Underwriters hereunder and the International Underwriters are simultaneously
entering into an Agreement between U.S. and International Underwriting
Syndicates (the "Agreement between Syndicates") which provides, among other
things, for the transfer of shares of Stock between the two syndicates. Two
forms of prospectus are to be used in connection with the offering and sale of
shares of Stock contemplated by the foregoing, one relating to the Shares
hereunder and the other relating to the International Shares. The latter form
of prospectus will be identical to the former except for certain substitute
pages as included in the registration statement and amendments thereto as
mentioned below.
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Except as used in Sections 2, 3, 4, 9 and 11 herein, and except as the context
may otherwise require, references hereinafter to the Shares shall include all
the shares of Stock which may be sold pursuant to either this Agreement or the
International Underwriting Agreement, and references herein to any prospectus
whether in preliminary or final form, and whether as amended or supplemented,
shall include both the U.S. and the international versions thereof.
1. (a) The Company represents and warrants to, and agrees with, each of
the Underwriters that:
(i) A registration statement on Form S-3 (File
No. 333-72145) (the "Initial Registration Statement") in respect
of the Shares has been filed with the Securities and Exchange
Commission (the "Commission"); the Initial Registration
Statement and any post-effective amendment thereto, each in the
form heretofore delivered to you, and, excluding exhibits
thereto but including all documents incorporated by reference in
the prospectus contained therein, to you for each of the other
Underwriters, have been declared effective by the Commission in
such form; other than a registration statement, if any,
increasing the size of the offering (a "Rule 462(b) Registration
Statement"), filed pursuant to Rule 462(b) under the Securities
Act of 1933, as amended (the "Act"), which became effective upon
filing, no other document with respect to the Initial
Registration Statement or document incorporated by reference
therein has heretofore been filed with the Commission; and no
stop order suspending the effectiveness of the Initial
Registration Statement, any post-effective amendment thereto or
the Rule 462(b) Registration Statement, if any, has been issued
and no proceeding for that purpose has been initiated or, to the
Company's knowledge, threatened by the Commission (any
preliminary prospectus included in the Initial Registration
Statement or filed with the Commission pursuant to Rule 424(a)
of the rules and regulations of the Commission under the Act is
hereinafter called a "Preliminary Prospectus"; the various
parts of the Initial Registration Statement and the Rule 462(b)
Registration Statement, if any, including all exhibits thereto
and including (i) the information contained in the form of final
prospectus filed with the Commission pursuant to Rule 424(b)
under the Act in accordance with Section 5(a) hereof and deemed
by virtue of Rule 430A under the Act to be part of the Initial
Registration Statement at the time it was declared effective and
(ii) the documents incorporated by reference in the prospectus
contained in the Initial Registration Statement at the time such
part of the Initial Registration Statement became effective,
each as amended at the time such part of the Initial
Registration Statement became effective or such part of the Rule
462(b) Registration Statement, if any, became or hereafter
becomes effective, are hereinafter collectively called the
"Registration Statement"; such final prospectus, in the form
first filed pursuant to Rule 424(b) under the Act, is
hereinafter called the "Prospectus"; any reference herein to
any Preliminary Prospectus or the Prospectus shall be deemed to
refer to and include the documents incorporated by reference
therein pursuant to Item 12 of Form S-3 under the Act, as of the
date of such Preliminary Prospectus or Prospectus, as the case
may be; any reference to any amendment or supplement to any
Preliminary Prospectus or the Prospectus shall be deemed to
refer to and include any documents filed after the date of such
Preliminary Prospectus or Prospectus, as the case may be, under
the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), and incorporated by reference in such Preliminary
Prospectus or Prospectus, as the case may be; and any reference
to any amendment to the Registration Statement shall be deemed
to refer to and include any annual report of the Company filed
pursuant to Section 13(a) or 15(d) of the Exchange Act after the
effective date of the Initial Registration Statement that is
incorporated by reference in the Registration Statement );
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(ii) No order preventing or suspending the use of
any Preliminary Prospectus has been issued by the Commission,
and each Preliminary Prospectus, at the time of filing thereof,
conformed in all material respects to the requirements of the
Act and the rules and regulations of the Commission thereunder
and did not contain an untrue statement of a material fact or
omit to state a material fact required to be stated therein or
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading;
provided, however, that this representation and warranty shall
not apply to any statements or omissions made in reliance upon
and in conformity with information furnished in writing to the
Company by an Underwriter through Xxxxxxx, Sachs & Co.
expressly for use therein or by a Selling Stockholder expressly
for use in the preparation of the answers therein to Item 7 of
Form S-3;
(iii) The documents incorporated by reference in
the Prospectus, when they became effective or were filed with
the Commission, as the case may be, conformed in all material
respects to the requirements of the Act or the Exchange Act, as
applicable, and the rules and regulations of the Commission
thereunder, and none of such documents contained an untrue
statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the
statements therein not misleading; and any further documents so
filed and incorporated by reference in the Prospectus or any
further amendment or supplement thereto, when such documents
become effective or are filed with the Commission, as the case
may be, will conform in all material respects to the
requirements of the Act or the Exchange Act, as applicable, and
the rules and regulations of the Commission thereunder and will
not contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary
to make the statements therein, in the light of the
circumstances under which they were made, not misleading;
provided, however, that this representation and warranty shall
not apply to any statements or omissions made in reliance upon
and in conformity with information furnished in writing to the
Company by an Underwriter through Xxxxxxx, Xxxxx & Co. expressly
for use therein;
(iv) The Registration Statement conforms, and the
Prospectus and any further amendments or supplements to the
Registration Statement or the Prospectus will conform, in all
material respects to the requirements of the Act and the rules
and regulations of the Commission thereunder and do not and will
not, as of the applicable effective date as to the Registration
Statement and any amendment thereto and as of the applicable
filing date as to the Prospectus and any amendment or supplement
thereto, contain an untrue statement of a material fact or omit
to state a material fact required to be stated therein or
necessary to make the statements therein not misleading;
provided, however, that this representation and warranty shall
not apply to any statements or omissions made in reliance upon
and in conformity with information furnished in writing to the
Company by an Underwriter through Xxxxxxx, Sachs & Co.
expressly for use therein or by a Selling Stockholder expressly
for use in the preparation of the answers therein to Item 7 of
Form S-3;
(v) Neither the Company nor any of its
subsidiaries has sustained since the date of the latest audited
financial statements included or incorporated by reference in
the Prospectus any material loss or interference with its
business from fire, explosion, flood or other calamity, whether
or not covered by insurance, or from any labor dispute or court
or governmental action, order or decree, otherwise than as set
forth or contemplated in the Prospectus; and, since the
respective dates as of which information is given in the
Registration Statement and the Prospectus, there has not been
any change in the consolidated loans (other than changes in the
ordinary course
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of the Company's business), capital stock (other than grants or
exercises of options pursuant to the Company's employee stock
option plans), short-term debt (other than changes in the
ordinary course of the Company's business) or long-term debt of
the Company or any of its subsidiaries or any material adverse
change, or any development involving a prospective material
adverse change, in or affecting the general affairs, management,
financial position, stockholders' equity or results of
operations of the Company and its subsidiaries, taken as a
whole, otherwise than as set forth or contemplated in the
Prospectus;
(vi) The Company and its subsidiaries have good
and marketable title in fee simple to all real property and good
and marketable title to all personal property owned by them, in
each case free and clear of all liens, encumbrances and defects
except such as are described in the Prospectus or such as do not
materially affect the value of such property and do not
materially interfere with the use made and proposed to be made
of such property by the Company and its subsidiaries; provided,
however, that the foregoing representation and warranty shall
not apply to any real property that the Company or any of its
subsidiaries has acquired by foreclosure in the ordinary course
of the Company's or such subsidiary's business; and any real
property and buildings held under lease by the Company and its
subsidiaries are held by them under valid, subsisting and
enforceable leases with such exceptions as are not material and
do not interfere with the use made and proposed to be made of
such property and buildings by the Company and its subsidiaries;
(vii) The Company has been duly incorporated and is
validly existing as a corporation in good standing under the
laws of the State of Delaware, with power and authority
(corporate and other) to own its properties and conduct its
business as described in the Prospectus, and has been duly
qualified as a foreign corporation for the transaction of
business and is in good standing under the laws of each other
jurisdiction in which it owns or leases properties or conducts
any business so as to require such qualification, or is subject
to no material liability or disability by reason of the failure
to be so qualified in any such jurisdiction; TeleBank, a wholly
owned subsidiary of the Company ("TeleBank"), has been duly
formed and is validly existing as a federally chartered savings
bank; each other subsidiary of the Company has been duly
incorporated or formed, as applicable, and is validly existing
as a corporation, limited liability company or business trust,
as applicable, in good standing under the laws of its
jurisdiction of organization; each of TeleBank and the other
subsidiaries of the Company has the power and authority
(corporate and other) to own its properties and conduct its
business as described in the Prospectus, and has been duly
qualified as a foreign corporation for the transaction of
business and is in good standing under the laws of each other
jurisdiction in which it owns or leases properties or conducts
any business so as to require such qualification, or is subject
to no material liability or disability by reason of the failure
to be so qualified in any such jurisdiction;
(viii) The Company has an authorized capitalization
as set forth in the Prospectus, and all of the issued shares of
capital stock of the Company have been duly and validly
authorized and issued, are fully paid and non-assessable and
conform to the description of the Stock contained in the
Prospectus; and all of the issued shares of capital stock of
each subsidiary of the Company have been duly and validly
authorized and issued, are fully paid and non-assessable and
(except for directors' qualifying shares) are owned directly or
indirectly by the Company, free and clear of all liens,
encumbrances, equities or claims;
(ix) The unissued Shares to be issued and sold by
the Company to the Underwriters hereunder and under the
International Underwriting Agreement have been duly and validly
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authorized and, when issued and delivered against payment
therefor as provided herein, will be duly and validly issued and
fully paid and non-assessable and will conform to the
description of the Stock contained in the Prospectus;
(x) The issue and sale of the Shares to be sold
by the Company hereunder and under the International
Underwriting Agreement and the compliance by the Company with
all of the provisions of this Agreement and the International
Underwriting Agreement and the consummation of the transactions
herein and therein contemplated will not conflict with or result
in a breach or violation of any of the terms or provisions of,
or constitute a default under, any indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument to which
the Company or any of its subsidiaries is a party or by which
the Company or any of its subsidiaries is bound or to which any
of the property or assets of the Company or any of its
subsidiaries is subject, nor will such action result in any
violation of the provisions of the Certificate of Incorporation
or By-laws of the Company or any statute or any order, rule or
regulation of any court or governmental agency or body having
jurisdiction over the Company or any of its subsidiaries or any
of their properties; and no consent, approval, authorization,
order, registration or qualification of or with any such court
or governmental agency or body is required for the issue and
sale of the Shares or the consummation by the Company of the
transactions contemplated by this Agreement and the
International Underwriting Agreement, except the registration
under the Act of the Shares and such consents, approvals,
authorizations, registrations or qualifications as may be
required under state securities or Blue Sky laws in connection
with the purchase and distribution of the Shares by the
Underwriters and the International Underwriters;
(xi) Neither the Company nor any of its
subsidiaries is in violation of its Certificate of
Incorporation, By-laws, limited liability company agreement,
declaration of trust or other charter document, as applicable;
and neither the Company nor any of its subsidiaries is in
default in the performance or observance of any obligation,
agreement, covenant or condition contained in any indenture,
mortgage, deed of trust, loan agreement, lease or other
agreement or instrument to which it is a party or by which it or
any of its properties may be bound, which default would,
individually or in the aggregate, have a material adverse effect
on the current or future consolidated financial position,
stockholders' equity or results of operations of the Company and
its subsidiaries, taken as a whole;
(xii) The statements set forth in the Prospectus
under the caption "Description of Securities", insofar as they
purport to constitute a summary of the terms of the Stock, under
the caption "Federal Income Tax Considerations" and under the
caption "Underwriting", insofar as they purport to describe the
provisions of the laws and documents referred to therein, are
accurate, complete and fair; provided, however, that this
representation and warranty shall not apply to any statements
made in reliance upon and in conformity with information
furnished in writing to the Company by an Underwriter through
Xxxxxxx, Xxxxx & Co. expressly for use therein;
(xiii) Other than as set forth in the Prospectus,
there are no legal or governmental proceedings pending to which
the Company or any of its subsidiaries is a party or of which
any property of the Company or any of its subsidiaries is the
subject which, if determined adversely to the Company or any of
its subsidiaries, individually or in the aggregate, would
reasonably be likely to have a material adverse effect on the
current or future consolidated financial position, stockholders'
equity or results of operations of the Company and its
subsidiaries, taken as a
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whole; and, to the best of the Company's knowledge, no such
proceedings are threatened or contemplated by governmental
authorities or threatened by others;
(xiv) The Company is not and, after giving effect
to the offering and sale of the Shares, will not be an
"investment company", as such term is defined in the Investment
Company Act of 1940, as amended (the "Investment Company Act");
(xv) Xxxxxx Xxxxxxxx LLP, who have certified
certain financial statements of the Company and its
subsidiaries, are independent public accountants as required by
the Act and the rules and regulations of the Commission
thereunder;
(xvi) The Company has reviewed its operations and
that of its subsidiaries to evaluate the extent to which the
business or operations of the Company or any of its subsidiaries
will be affected by the Year 2000 Problem and has examined
whether there would be a material adverse effect on the
Company's business, results of operations or financial condition
if any third party with which the Company or any of its
subsidiaries has a material relationship has a Year 2000
Problem. As a result of such review, the Company has not
identified any significant Year 2000 Problems and does not
anticipate that costs associated with the Year 2000 Problem will
have a material financial impact on the general current or
future consolidated financial position, stockholders' equity or
results of operations of the Company and its subsidiaries, taken
as a whole. In addition, the Company has determined that the
impact of the Year 2000 Problem on the Company's and its
subsidiaries non-information technology systems does not present
a significant risk to the financial position, stockholders'
equity or results of operations of the Company and its
subsidiaries, taken as a whole. The "Year 2000 Problem" as used
herein means any significant risk that computer hardware or
software used in the receipt, transmission, processing,
manipulation, storage, retrieval, retransmission or other
utilization of data or in the operation of mechanical or
electrical systems of any kind will not, in the case of dates or
time periods occurring after December 31, 1999, function at
least as effectively as in the case of dates or time periods
occurring prior to January 1, 2000;
(xvii) The Company is a registered savings and loan
holding company under the Home Owners' Loan Act ("HOLA"); the
activities of the subsidiaries of TeleBank are permitted
activities for subsidiaries of a federally chartered savings
bank under applicable law, including the rules and regulations
of the Office of Thrift Supervision set forth in Chapter V of
Title 12 of the Code of Federal Regulations;
(xiii) Except as described in the Prospectus, each
of the Company and its subsidiaries owns or possesses adequate
licenses or other rights to use all trademarks, service marks,
trade names, copyrights, and know-how necessary to conduct the
business now or proposed to be conducted by the Company and its
subsidiaries as described in the Prospectus, and neither the
Company nor any subsidiary has received any notice of
infringement of or notice of conflict with (and knows of no such
infringement of or conflict with) asserted rights of others with
respect to trademarks, service marks, trade names, copyrights,
and know-how which, individually or in the aggregate, is
reasonably likely to result in any material adverse effect upon
the financial position, stockholders' equity or results of
operations of the Company and its subsidiaries, taken as a
whole; the Company and each subsidiary does not in the conduct
of its business as now or proposed to be conducted as described
in the Prospectus, infringe or conflict with any right of any
third party, known to the Company, where such infringement or
conflict is reasonably likely to result in any material adverse
effect upon the financial position, stockholders' equity or
results of operations of the Company and its subsidiaries, taken
as a whole;
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(xix) Each of the Company and its subsidiaries has
obtained any permits, consents and authorizations required to be
obtained by it under laws or regulations relating to its
business (collectively, "Laws"), and any such permits, consents
and authorizations remain in full force and effect, except as to
any of the foregoing the absence of which (individually or in
the aggregate) will not have a material adverse effect on the
financial position, stockholders' equity or results of
operations of the Company and its subsidiaries, taken as a
whole. Each of the Company and its subsidiaries is in
compliance with the Laws in all material respects, and there is
no pending or, to the Company's knowledge, threatened, action or
proceeding against the Company or any of its subsidiaries under
such Laws, other than any such actions or proceedings which,
individually or in the aggregate, if adversely determined, is
not reasonably likely to have a material adverse effect on the
financial position, stockholders' equity or results of
operations of the Company and its subsidiaries, taken as a
whole; and
(xx) Except as disclosed in the Prospectus, there
are no holders of any security (debt or equity) of the Company
or any of its subsidiaries who have or will have any right to
require the registration of such security by virtue of the
filing of the Registration Statement or the execution by the
Company of this Agreement or the International Underwriting
Agreement.
(b) Each of the Selling Stockholders severally represents and
warrants to, and agrees with, each of the Underwriters and the Company that:
(i) All consents, approvals, authorizations and
orders necessary for the execution and delivery by such Selling
Stockholder of this Agreement, the International Underwriting
Agreement and the Custody Agreement hereinafter referred to, and
for the sale and delivery of the Shares to be sold by such
Selling Stockholder hereunder and under the International
Underwriting Agreement, have been obtained; and such Selling
Stockholder has full right, power and authority to enter into
this Agreement, the International Underwriting Agreement and the
Custody Agreement and to sell, assign, transfer and deliver the
Shares to be sold by such Selling Stockholder hereunder and
under the International Underwriting Agreement;
(ii) The sale of the Shares to be sold by such
Selling Stockholder hereunder and under the International
Underwriting Agreement and the compliance by such Selling
Stockholder with all of the provisions of this Agreement, the
International Underwriting Agreement and the Custody Agreement
and the consummation of the transactions herein and therein
contemplated will not conflict with or result in a breach or
violation of any of the terms or provisions of, or constitute a
default under, any statute, indenture, mortgage, deed of trust,
loan agreement or other agreement or instrument to which such
Selling Stockholder is a party or by which such Selling
Stockholder is bound or to which any of the property or assets
of such Selling Stockholder is subject, nor will such action
result in any violation of any statute or any order, rule or
regulation of any court or governmental agency or body having
jurisdiction over such Selling Stockholder or the property of
such Selling Stockholder;
(iii) Such Selling Stockholder has, and immediately
prior to each Time of Delivery (as defined in Section 4 hereof)
such Selling Stockholder will have, good and valid title to the
Shares to be sold by such Selling Stockholder hereunder and
under the International Underwriting Agreement, free and clear
of all liens, encumbrances, equities or claims; and, upon
delivery of such Shares and payment therefor pursuant hereto and
thereto, good and valid title to such Shares, free and clear of
all liens, encumbrances, equities or claims, will pass to the
several Underwriters or the International Underwriters, as the
case may be;
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(iv) During the period beginning from the date
hereof and continuing to and including the date 180 days after
the date of the Prospectus, not to offer, sell, contract to sell
or otherwise dispose of, except as provided hereunder or under
the International Underwriting Agreement, any securities of the
Company that are substantially similar to the Shares, including
but not limited to any securities that are convertible into or
exchangeable for, or that represent the right to receive, Stock
or any such substantially similar securities (other than
pursuant to employee stock option plans existing on, or upon the
conversion or exchange of convertible or exchangeable securities
outstanding as of, the date of this Agreement), without your
prior written consent;
(v) Such Selling Stockholder has not taken and
will not take, directly or indirectly, any action that is
designed to or that has constituted or that might reasonably be
expected to cause or result in stabilization or manipulation of
the price of any security of the Company to facilitate the sale
or resale of the Shares;
(vi) To the extent that any statements or
omissions made in the Registration Statement, any Preliminary
Prospectus, the Prospectus or any amendment or supplement
thereto are made in reliance upon and in conformity with written
information furnished to the Company by such Selling Stockholder
for use therein, such Preliminary Prospectus and the
Registration Statement did, and the Prospectus and any further
amendments or supplements to the Registration Statement and the
Prospectus, when they become effective or are filed with the
Commission, as the case may be, will conform in all material
respects to the requirements of the Act and the rules and
regulations of the Commission thereunder and 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) In order to document the Underwriters'
compliance with the reporting and withholding provisions of the
Tax Equity and Fiscal Responsibility Act of 1982 with respect to
the transactions herein contemplated, such Selling Stockholder
will deliver to you in care of Xxxxxxx, Xxxxx & Co. prior to or
at the First Time of Delivery (as hereinafter defined) a
properly completed and executed United States Treasury
Department Form W-9 (or other applicable form or statement
specified by Treasury Department regulations in lieu thereof);
(viii) Certificates in negotiable form representing
all of the Shares to be sold by such Selling Stockholder
hereunder and under the International Underwriting Agreement
have been placed in custody under a Custody Agreement, in the
form heretofore furnished to you in care of Xxxxxxx, Sachs & Co.
(the "Custody Agreement"), duly executed and delivered by such
Selling Stockholder to [NAME OF CUSTODIAN], as custodian (the
"Custodian"); and
(ix) The Shares represented by the certificates
held in custody for such Selling Stockholder under the Custody
Agreement are subject to the interests of the Underwriters
hereunder and the International Underwriters under the
International Underwriting Agreement; the arrangements made by
such Selling Stockholder for such custody are to that extent
irrevocable; the obligations of the Selling Stockholders
hereunder shall not be terminated by operation of law, whether
by the death or incapacity of any individual Selling Stockholder
or, in the case of an estate or trust, by the death or
incapacity of any executor or trustee or the termination of such
estate or trust, or in the case of a partnership or corporation,
by the dissolution of such partnership or corporation, or by the
occurrence of any other event; if any individual Selling
Stockholder or any such executor or trustee should die or become
incapacitated, or if any such estate or trust should be
terminated, or if any such partnership or corporation should be
dissolved, or if any other such event should occur, before the
delivery of the Shares hereunder, certificates representing the
Shares shall be
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delivered by or on behalf of the Selling Stockholders in
accordance with the terms and conditions of this Agreement, of
the International Underwriting Agreement and of the Custody
Agreements.
2. Subject to the terms and conditions herein set forth, (a) the
Company and each of the Selling Stockholders agree, severally and not jointly,
to sell to each of the Underwriters, and each of the Underwriters agrees,
severally and not jointly, to purchase from the Company and each of the Selling
Stockholders, at a purchase price per share of $.............., the number of
Firm Shares (to be adjusted by you so as to eliminate fractional shares)
determined by multiplying the aggregate number of Firm Shares to be sold by the
Company and each of the Selling Stockholders as set forth opposite their
respective names in Schedule II hereto by a fraction, the numerator of which is
the aggregate number of Firm Shares to be purchased by such Underwriter as set
forth opposite the name of such Underwriter in Schedule I hereto and the
denominator of which is the aggregate number of Firm Shares to be purchased by
all of the Underwriters from the Company and all of the Selling Stockholders
hereunder and (b) in the event and to the extent that the Underwriters shall
exercise the election to purchase Optional Shares as provided below, the
Company agrees to sell to each of the Underwriters, and each of the
Underwriters agrees, severally and not jointly, to purchase from the Company,
at the purchase price per share set forth in clause (a) of this Section 2, that
portion of the number of Optional Shares as to which such election shall have
been exercised (to be adjusted by you so as to eliminate fractional shares)
determined by multiplying such number of Optional Shares by a fraction the
numerator of which is the maximum number of Optional Shares that such
Underwriter is entitled to purchase as set forth opposite the name of such
Underwriter in Schedule I hereto and the denominator of which is the maximum
number of Optional Shares that all of the Underwriters are entitled to purchase
hereunder.
The Company hereby grants to the Underwriters the right to
purchase at their election up to ................... Optional Shares, at the
purchase price per share set forth in the paragraph above, for the sole purpose
of covering overallotments in the sale of the Firm Shares. Any such election
to purchase Optional Shares may be exercised only by written notice from you to
the Company, given within a period of 30 calendar days after the date of this
Agreement and setting forth the aggregate number of Optional Shares to be
purchased and the date on which such Optional Shares are to be delivered, as
determined by you but in no event earlier than the First Time of Delivery (as
defined in Section 4 hereof) or, unless you and the Company otherwise agree in
writing, earlier than two or later than ten business days after the date of
such notice.
3. Upon the authorization by you of the release of the Firm Shares,
the several Underwriters propose to offer the Firm Shares for sale upon the
terms and conditions set forth in the Prospectus.
4. (a) The Shares to be purchased by each Underwriter hereunder, in
definitive form, and in such authorized denominations and registered in such
names as Xxxxxxx, Xxxxx & Co. may request upon at least forty-eight hours'
prior notice to the Company and the Selling Stockholders shall be delivered by
or on behalf of the Company and the Selling Stockholders to Xxxxxxx, Sachs &
Co., through the facilities of the Depository Trust Company ("DTC"), for the
account of such Underwriter, against payment by or on behalf of such
Underwriter of the purchase price therefor by wire transfer of Federal
(same-day) funds to the account specified by the Company and the Custodian to
Xxxxxxx, Xxxxx & Co. at least forty-eight hours in advance. The Company will
cause the certificates representing the Shares to be made available for
checking and packaging at least twenty-four hours prior to the Time of Delivery
(as defined below) with respect thereto at the office of DTC or its designated
custodian (the "Designated Office"). The time and date of such delivery and
payment shall be, with respect to the Firm Shares, 9:30 a.m., New York time, on
............., 1999 or such other time and date as Xxxxxxx, Sachs & Co. and the
Company may agree upon in writing, and, with respect to the Optional Shares,
9:30 a.m.,
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New York time, on the date specified by Xxxxxxx, Xxxxx & Co. in the written
notice given by Xxxxxxx, Sachs & Co. of the Underwriters' election to purchase
such Optional Shares, or such other time and date as Xxxxxxx, Xxxxx & Co. and
the Company may agree upon in writing. Such time and date for delivery of the
Firm Shares is herein called the "First Time of Delivery", such time and date
for delivery of the Optional Shares, if not the First Time of Delivery, is
herein called the "Second Time of Delivery", and each such time and date for
delivery is herein called a "Time of Delivery".
(b) The documents to be delivered at each Time of Delivery by
or on behalf of the parties hereto pursuant to Section 7 hereof, including the
cross receipt for the Shares and any additional documents requested by the
Underwriters pursuant to Section 7(m) hereof, will be delivered at the offices
of Xxxxxxxx & Xxxxxxxx, 0000 Xxxxxxxxxxxx Xxxxxx, X.X., Xxxxxxxxxx, X.X. 00000
(the "Closing Location"), and the Shares will be delivered at the Designated
Office, all at such Time of Delivery. A meeting will be held at the Closing
Location at 3:00 p.m., New York City time, on the New York Business Day next
preceding such Time of Delivery, at which meeting the final drafts of the
documents to be delivered pursuant to the preceding sentence will be available
for review by the parties hereto. For the purposes of this Section 4, "New
York Business Day" shall mean each Monday, Tuesday, Wednesday, Thursday and
Friday that is not a day on which banking institutions in New York are
generally authorized or obligated by law or executive order to close.
5. The Company agrees with each of the Underwriters:
(a) To prepare the Prospectus in a form approved by you
and to file such Prospectus pursuant to Rule 424(b) under the
Act not later than the Commission's close of business on the
second business day following the execution and delivery of this
Agreement, or, if applicable, such earlier time as may be
required by Rule 430A(a)(3) under the Act; to make no further
amendment or any supplement to the Registration Statement or
Prospectus prior to the last Time of Delivery that shall be
reasonably disapproved by you promptly after reasonable notice
thereof; to advise you, promptly after it receives notice
thereof, of the time when any amendment to the Registration
Statement has been filed or becomes effective or any supplement
to the Prospectus or any amended Prospectus has been filed and
to furnish you with copies thereof; to file promptly all reports
and any definitive proxy or information statements required to
be filed by the Company with the Commission pursuant to Section
13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to the
date of the Prospectus and for so long as the delivery of a
prospectus is required in connection with the offering or sale
of the Shares; to advise you, promptly after it receives notice
thereof, of the issuance by the Commission of any stop order or
of any order preventing or suspending the use of any Preliminary
Prospectus or prospectus, of the suspension of the qualification
of the Shares for offering or sale in any jurisdiction, of the
initiation or threatening of any proceeding for any such
purpose, or of any request by the Commission for the amending or
supplementing of the Registration Statement or Prospectus or for
additional information; and, in the event of the issuance of any
stop order or of any order preventing or suspending the use of
any Preliminary Prospectus or prospectus or suspending any such
qualification, promptly to use its best efforts to obtain the
withdrawal of such order;
(b) Promptly from time to time to take such action as you
may reasonably request to qualify the Shares for offering and
sale under the securities laws of such jurisdictions as you may
request and to comply with such laws so as to permit the
continuance of sales and dealings therein in such jurisdictions
for as long as may be necessary to complete the distribution of
the Shares, provided that in connection therewith 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;
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(c) Prior to 10:00 A.M., New York City time, on the New
York Business Day next succeeding the date of this Agreement and
from time to time, to furnish the Underwriters with copies of
the Prospectus in New York City in such quantities as you may
reasonably request, and, if the delivery of a prospectus is
required at any time prior to the expiration of nine months
after the time of issue of the Prospectus in connection with the
offering or sale of the Shares and if at such time any events
shall have occurred as a result of which the Prospectus as then
amended or supplemented would include an untrue statement of a
material fact or omit to state any material fact necessary in
order to make the statements therein, in the light of the
circumstances under which they were made when such Prospectus is
delivered, not misleading, or, if for any other reason it shall
be necessary during such period to amend or supplement the
Prospectus or to file under the Exchange Act any document
incorporated by reference in the Prospectus in order to comply
with the Act or the Exchange Act, to notify you and upon your
request to file such document and to prepare and furnish without
charge to each Underwriter and to any dealer in securities as
many copies as you may from time to time reasonably request of
an amended Prospectus or a supplement to the Prospectus that
will correct such statement or omission or effect such
compliance, and in case any Underwriter is required to deliver a
prospectus in connection with sales of any of the Shares at any
time nine months or more after the time of issue of the
Prospectus, upon your request but at the expense of such
Underwriter, to prepare and deliver to such Underwriter as many
copies as you may request of an amended or supplemented
Prospectus complying with Section 10(a)(3) of the Act;
(d) To make generally available to its securityholders as
soon as practicable, but in any event not later than eighteen
months after the effective date of the Registration Statement
(as defined in Rule 158(c) under the Act), an earnings statement
of the Company and its subsidiaries (which need not be audited)
complying with Section 11(a) of the Act and the rules and
regulations of the Commission thereunder (including, at the
option of the Company, Rule 158);
(e) During the period beginning from the date hereof and
continuing to and including the date 180 days after the date of
the Prospectus, not to offer, sell, contract to sell or
otherwise dispose of, except as provided hereunder and under the
International Underwriting Agreement, any securities of the
Company that are substantially similar to the Shares, including
but not limited to any securities that are convertible into or
exchangeable for, or that represent the right to receive, Stock
or any such substantially similar securities (other than (i)
pursuant to employee stock option plans existing on the date of
this Agreement, (ii) pursuant to employee stock option plans
that are approved by the Company's stockholders at the next
annual meeting of the Company's stockholders and in the form
previously provided to Xxxxxxx, Sachs & Co., (iii) upon the
conversion or exchange of convertible or exchangeable securities
outstanding as of the date of this Agreement and (iv) other than
in connection with any acquisitions, business combinations or
strategic investments by the Company), without your prior
written consent;
(f) To furnish to its stockholders as soon as practicable
after the end of each fiscal year an annual report (including a
balance sheet and statements of income, stockholders' equity and
cash flows of the Company and its consolidated subsidiaries
certified by independent public accountants) and, as soon as
practicable after the end of each of the first three quarters of
each fiscal year (beginning with the fiscal quarter ending after
the effective date of the Registration Statement), to make
available to its stockholders consolidated summary financial
information of the Company and its subsidiaries for such quarter
in reasonable detail;
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(g) During a period of five years from the effective date
of the Registration Statement, to furnish to you copies of all
reports or other communications (financial or other) furnished
to stockholders, and to deliver to you (i) as soon as they are
available, copies of any reports and financial statements
furnished to or filed with the Commission or any national
securities exchange on which any class of securities of the
Company is listed; and (ii) such additional non-confidential
information concerning the business and financial condition of
the Company as you may from time to time reasonably request
(such financial statements to be on a consolidated basis to the
extent the accounts of the Company and its subsidiaries are
consolidated in reports furnished to its stockholders generally
or to the Commission);
(h) To use the net proceeds received by it from the sale
of the Shares pursuant to this Agreement and the International
Underwriting Agreement in the manner specified in the Prospectus
under the caption "Use of Proceeds";
(i) To use its best efforts to list for quotation the
Shares on The Nasdaq Stock Market's Nasdaq National Market
("NASDAQ"); and
(j) To file a Rule 462(b) Registration Statement with the
Commission in compliance with Rule 462(b) by 10:00 P.M.,
Washington, D.C. time, on the date of this Agreement, and at the
time of filing either to pay to the Commission the filing fee
for the Rule 462(b) Registration Statement or give irrevocable
instructions for the payment of such fee pursuant to Rule 111(b)
under the Act, if the Company elects to rely upon Rule 462(b).
6. The Company agrees with the several Underwriters that (a)
the Company will pay the following: (i) the fees, disbursements and expenses of
the Company's counsel and accountants in connection with the registration of
the Shares under the Act and all other expenses in connection with the
preparation, printing and filing of the Registration Statement, any Preliminary
Prospectus and the Prospectus and amendments and supplements thereto and the
mailing and delivering of copies thereof to the Underwriters and dealers; (ii)
the cost of printing or producing any Agreement among Underwriters, this
Agreement, the International Underwriting Agreement, the Agreement between
Syndicates, the Selling Agreements, the Blue Sky Memorandum, closing documents
(including any compilations thereof) and any other documents in connection with
the offering, purchase, sale and delivery of the Shares; (iii) all expenses in
connection with the qualification of the Shares for offering and sale under
state securities laws as provided in Section 5(b) hereof, including the fees
and disbursements of counsel for the Underwriters in connection with such
qualification and in connection with the Blue Sky survey; (iv) all fees and
expenses in connection with listing the Shares on the NASDAQ; and (v) the
filing fees incident to, and the reasonable fees and disbursements of counsel
for the Underwriters in connection with, securing any required review by the
National Association of Securities Dealers, Inc. of the terms of the sale of
the Shares; (b) the Company will pay or cause to be paid: (i) the cost of
preparing stock certificates; (ii) the cost and charges of any transfer agent
or registrar; and (iii) all other costs and expenses incident to the performance
of its obligations hereunder that are not otherwise specifically provided for
in this Section; and (c) such Selling Stockholder will pay or cause to be paid
all costs and expenses incident to the performance of such Selling
Stockholder's obligations hereunder that are not otherwise specifically
provided for in this Section, including (i) any fees and expenses of counsel
for such Selling Stockholder, (ii) such Selling Stockholder's pro rata share of
the fees and expenses of the Attorneys-in-Fact and the Custodian, and (iii) all
expenses and taxes incident to the sale and delivery of the Shares to be sold
by such Selling Stockholder to the Underwriters hereunder. It is understood,
however, that, except as provided in this Section, and Sections 8 and 11
hereof, the Underwriters will pay all of their own costs
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and expenses, including the fees of their counsel, stock transfer taxes on
resale of any of the Shares by them, and any advertising expenses connected
with any offers they may make.
7. The obligations of the Underwriters hereunder, as to the
Shares to be delivered at each Time of Delivery, shall be subject, in their
discretion, to the condition that all representations and warranties and other
statements of the Company and of the Selling Stockholders herein are, at and as
of such Time of Delivery, true and correct, the condition that the Company and
the Selling Stockholders shall have performed all of its and their obligations
hereunder theretofore to be performed, and the following additional conditions:
(a) The Prospectus shall have been filed with the Commission
pursuant to Rule 424(b) within the applicable time period prescribed for such
filing by the rules and regulations under the Act and in accordance with
Section 5(a) hereof; if the Company has elected to rely upon Rule 462(b), the
Rule 462(b) Registration Statement shall have become effective by 10:00 P.M.,
Washington, D.C. time, on the date of this Agreement; no stop order suspending
the effectiveness of the Registration Statement or any part thereof shall have
been issued and no proceeding for that purpose shall have been initiated or
threatened by the Commission; and all requests for additional information on
the part of the Commission shall have been complied with to your reasonable
satisfaction;
(b) Xxxxxxxx & Xxxxxxxx, counsel for the Underwriters, shall have
furnished to you such written opinion or opinions (a draft of each such opinion
is attached as Annex II(a) hereto), dated such Time of Delivery, with respect
to the incorporation of the Company, the validity of the Shares being delivered
at such Time of Delivery, this Agreement, the Registration Statement, the
Prospectus and other related matters as you may reasonably request, and such
counsel shall have received such papers and information as they may reasonably
request to enable them to pass upon such matters;
(c) Xxxxx & Xxxxxxx L.L.P., special counsel for the Company, shall
have furnished to you their written opinion (a draft of such opinion is
attached as Annex II(b) hereto), dated such Time of Delivery, in form and
substance satisfactory to you, to the effect that:
(i) The Company has been duly incorporated and is validly existing as a
corporation in good standing as of the date of the certificate specified
in such opinion, under the laws of the State of Delaware; the Company has
the corporate power and corporate authority under its Certificate of
Incorporation and the Delaware General Corporation Law to own its current
properties and to conduct its business as described in the Prospectus;
the Company is a registered savings and loan holding company under the
HOLA;
(ii) The authorized, issued and outstanding capital stock of
the Company as of December 31, 1998 is set forth in the Prospectus under
the caption "Capitalization"; all of the issued shares of Stock of the
Company shown as issued and outstanding under said caption and that have
been issued from January 1, 1999 to such Time of Delivery are duly and
validly authorized and, assuming the receipt of consideration therefor as
provided in resolutions of the Company's Board of Directors authorizing
issuance thereof, are validly issued, fully paid and non-assessable;
(iii) This Agreement and the International Underwriting Agreement have
been duly authorized, executed and delivered by the Company;
(iv) The Shares are duly and validly authorized and, when issued in
accordance with the provisions of this Agreement and the International
Underwriting Agreement, will be validly issued, fully paid and
non-assessable; the form of certificate evidencing the Shares complies
with the requirements of Section 158 of the Delaware General Corporation
Law;
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(v) The issue and sale of the Shares being delivered at such Time of
Delivery by the Company hereunder and under the International
Underwriting Agreement, the compliance by the Company with all of the
provisions of this Agreement and the International Underwriting Agreement
and the consummation by the Company of the transactions herein and
therein contemplated will not (A) violate the Delaware General
Corporation Law or the Certificate of Incorporation or Bylaws of the
Company, (B) to such counsel's knowledge, violate any statute or any
order, rule or regulation of any court or governmental agency or body
having jurisdiction over the Company or any of its subsidiaries or any of
their properties, or (C) conflict with, breach or constitute a default
under any agreement or contract filed as an exhibit to the Registration
Statement or filed as an exhibit to the Company's Annual Report on Form
10-K for the year ended December 31, 1998;
(vi) No consent, approval, authorization, order, registration or
qualification of or with any federal or Delaware or Virginia state court
or governmental agency or body is required for the issue and sale of the
Shares or the consummation by the Company of the transactions
contemplated by this Agreement and the International Underwriting
Agreement, except the registration under the Act of the Shares, and such
consents, approvals, authorizations, registrations or qualifications as
may be required under state securities or Blue Sky laws in connection
with the purchase and distribution of the Shares by the Underwriters and
the International Underwriters;
(vii) The information in the Prospectus under the captions "Description
of Securities," "Federal Income Tax Considerations" and "Underwriting,"
to the extent that such information constitutes or describes matters of
law or legal conclusions or constitutes summaries of documents described
therein, has been reviewed by us, and is correct in all material
respects; the Shares conform to the description of the Stock set forth in
the Prospectus under the caption "Description of Securities";
(viii) The Company is not an "investment company", as such term is
defined in the Investment Company Act;
(ix) The documents incorporated by reference in the Prospectus or any
further amendment or supplement thereto made by the Company prior to such
Time of Delivery (except for the financial statements and supporting
schedules included therein, as to which such counsel need express no
opinion), when they became effective or were filed with the Commission,
as the case may be, complied as to form in all material respects with the
requirements of the Act or the Exchange Act, as applicable, and the
applicable rules and regulations thereunder;
(x) The Registration Statement and the Prospectus and any further
amendments and supplements thereto made by the Company prior to such Time
of Delivery (except for the financial statements and supporting schedules
included therein, as to which such counsel need express no opinion)
comply as to form in all material respects with the requirements of the
Act and the applicable rules and regulations thereunder; and
(xi) Except as set forth in the Registration Statement and the
Prospectus, to such counsel's knowledge, no holders of Stock or other
securities of the Company have registration rights with respect to
securities of the Company, and all holders of securities of the Company
having rights to registration of such shares of Stock or other
securities, because of the filing of the Registration Statement by the
Company have, with respect to the offering contemplated thereby, waived
such rights.
In addition, such counsel shall state that during the course of the
preparation of the Registration Statement and the Prospectus, such
counsel participated in conferences with officers and other
representatives of the Company, with representatives of the independent
public accountants of the
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Company and with you and your representatives. While such counsel has
not undertaken to determine independently, and such counsel does not
assume any responsibility for, the accuracy, completeness, or fairness of
the statements in the Registration Statement or Prospectus (other than
those referred to in the opinion referred to in subsection (vii) of this
Section 7(c)), such counsel shall state on the basis of these conferences
and their activities as special counsel to the Company in connection with
the Registration Statement that no facts have come to their attention
which cause them to believe that (i) the Registration Statement or any
further amendment thereto made by the Company prior to such Time of
Delivery, at the time it became effective, contained an untrue statement
of a material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein not
misleading, or that the Prospectus or any further amendment or supplement
thereto made by the Company prior to such Time of Delivery, as of its
date and as of such Time of Delivery, contained or contains an untrue
statement of a material fact or omitted or omits to state a material fact
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, (ii) any of the
documents incorporated by reference in the Prospectus or any further
amendment or supplement thereto made by the Company prior to such Time of
Delivery, when such documents were filed or became effective, as the case
may be, contained, in the case of a registration statement that became
effective under the Act, an untrue statement of a material fact or
omitted to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, or, in the case
of other documents that were filed under the Exchange Act with the
Commission, an untrue statement of a material fact or omitted to state a
material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made when such documents
were filed, not misleading, (iii) there are any legal or governmental
proceedings pending to which the Company or any of its subsidiaries is a
party or of which any property of the Company or any of its subsidiaries
is the subject that, if determined adversely to the Company or any of its
subsidiaries, would individually or in the aggregate reasonably be
expected to have a material adverse effect on the current or future
consolidated financial position, stockholders' equity or results of
operations of the Company and its subsidiaries; and, to the best of such
counsel's knowledge, no such proceedings are threatened or contemplated
by governmental authorities or threatened by others, or (iv) there are
any contracts or other documents of a character required to be described
in the Registration Statement or the Prospectus or required to be filed
as an exhibit to the Registration Statement that are not described or
referred to therein or so filed; provided that in making the foregoing
statements (which shall not constitute an opinion), such counsel need not
express any views as to the financial statements and supporting schedules
and other financial data included in or omitted from the Registration
Statement or the Prospectus.
In rendering such opinion, such counsel may state that they express
no opinion as to the laws of any jurisdiction outside the United States.
(d) Xxxxx X. Xxxxxxx, Executive Vice President and
General Counsel of the Company, shall have furnished to you his written
opinion (a draft of such opinion is attached as Annex II(c) hereto),
dated such Time of Delivery, in form and substance satisfactory to you,
to the effect that:
(i) The Company has been duly incorporated and is validly
existing as a corporation in good standing as of the date of the
certificate specified in such opinion, under the laws of the State of
Delaware; the Company has the power and authority (corporate and other)
to own its properties and conduct its business as described in the
Prospectus; the Company is a registered savings and loan holding company
under the HOLA;
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(ii) The authorized, issued and outstanding capital stock
of the Company as of December 31, 1998 is set forth in the Prospectus
under the caption "Capitalization", and all of the issued shares of Stock
of the Company are duly and validly authorized and are validly issued,
fully paid and non-assessable; the Shares are duly and validly authorized
and, when issued in accordance with the provisions of this Agreement and
the International Underwriting Agreement, will be validly issued, fully
paid and non-assessable; and the Shares conform to the description of the
Stock set forth in the Prospectus under the caption "Description of
Securities";
(iii) The Company has been duly qualified as a foreign
corporation for the transaction of business and is in good standing under
the laws of each other jurisdiction in which it owns or leases properties
or conducts any business so as to require such qualification, or is
subject to no material liability or disability by reason of failure to be
so qualified in any such jurisdiction (such counsel being entitled to
rely in respect of the opinion in this clause upon opinions of local
counsel and in respect of matters of fact upon certificates of officers
of the Company, provided that such counsel shall state that they believe
that both you and they are justified in relying upon such opinions and
certificates);
(iv) TeleBank has been duly formed and is validly existing
as a federally chartered savings bank and holds a valid certificate to do
business as such; each other subsidiary of the Company has been duly
incorporated or formed, as applicable, and is validly existing as a
corporation, limited liability company or business trust, as applicable,
in good standing under the laws of its jurisdiction of organization; and
all of the issued shares of capital stock of TeleBank and each such
subsidiary have been duly and validly authorized and issued, are fully
paid and non-assessable, and (except for directors' qualifying shares)
are owned directly or indirectly by the Company, free and clear of all
liens, encumbrances, equities or claims (such counsel being entitled to
rely in respect of the opinion in this clause upon opinions of local
counsel and in respect of matters of fact upon certificates of officers
of the Company or its subsidiaries, provided that such counsel shall
state that they believe that both you and they are justified in relying
upon such opinions and certificates);
(v) The Company and its subsidiaries have title in fee
simple to all real property owned by them, in each case free and clear of
all liens, encumbrances and defects except such as are described in the
Prospectus or such as do not materially affect the value of such property
and do not interfere with the use made and proposed to be made of such
property by the Company and its subsidiaries; provided, however, that
counsel shall not be required to give any opinion with respect to any
real property that the Company or any of its subsidiaries has acquired by
foreclosure in the ordinary course of the Company's or such subsidiary's
business; and any real property and buildings held under lease by the
Company and its subsidiaries are held by them under valid, subsisting and
enforceable leases with such exceptions as are not material and do not
interfere with the use made and proposed to be made of such property and
buildings by the Company and its subsidiaries (in giving the opinion in
this clause, such counsel may state that no examination of record titles
for the purpose of such opinion has been made, and that they are relying
upon a general review of the titles of the Company and its subsidiaries,
upon opinions of local counsel and abstracts, reports and policies of
title companies rendered or issued at or subsequent to the time of
acquisition of such property by the Company or its subsidiaries, upon
opinions of counsel to the lessors of such property and, in respect of
matters of fact, upon certificates of officers of the Company or its
subsidiaries, provided that such counsel shall state that they believe
that both you and they are justified in relying upon such opinions,
abstracts, reports, policies and certificates);
(vi) To the best of such counsel's knowledge and other
than as set forth in the Prospectus, there are no legal or governmental
proceedings pending to which the Company or any of its
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subsidiaries is a party or of which any property of the Company or any of
its subsidiaries is the subject that, if determined adversely to the
Company or any of its subsidiaries, would individually or in the
aggregate have a material adverse effect on the current or future
consolidated financial position stockholders' equity or results of
operations of the Company and its subsidiaries; and, to the best of such
counsel's knowledge, no such proceedings are threatened or contemplated
by governmental authorities or threatened by others;
(vii) The issue and sale of the Shares being delivered at
such Time of Delivery by the Company hereunder and under the
International Underwriting Agreement, the compliance by the Company with
all of the provisions of this Agreement and the International
Underwriting Agreement and the consummation of the transactions herein
and therein contemplated will not (A) violate the Delaware General
Corporation Law or the Certificate of Incorporation or Bylaws of the
Company, (B) violate any statute or any order, rule or regulation,
judgment or decree of any court or governmental agency or body having
jurisdiction over the Company or any of its subsidiaries or any of their
properties, or (C) conflict with or result in a breach or violation of
any of the terms or provisions of, or constitute a default under, any
indenture, mortgage, deed of trust, loan agreement or other agreement or
instrument known to such counsel to which the Company or any of its
subsidiaries is a party or by which the Company or any of its
subsidiaries is bound or to which any of the property or assets of the
Company or any of its subsidiaries is subject;
(viii) Neither the Company nor any of its subsidiaries is in
violation of its Certificate of Incorporation, By-laws, limited liability
company agreement, declaration of trust or other charter document, as
applicable; and neither the Company nor any of its subsidiaries is in
default in the performance or observance of any obligation, agreement,
covenant or condition contained in any indenture, mortgage, deed of
trust, loan agreement, or lease or agreement or other instrument to which
it is a party or by which it or any of its properties may be bound, which
default would, individually or in the aggregate, have a material adverse
effect on the current or future consolidated financial position,
stockholders' equity or results of operations of the Company and its
subsidiaries, taken as a whole;
(ix) The documents incorporated by reference in the
Prospectus or any further amendment or supplement thereto made by the
Company prior to such Time of Delivery (other than the financial
statements and related schedules therein, as to which such counsel need
express no opinion), when they became effective or were filed with the
Commission, as the case may be, complied as to form in all material
respects with the requirements of the Act or the Exchange Act, as
applicable and the applicable rules and regulations of the Commission
thereunder; such counsel shall also include a statement in his letter to
the following effect: no facts have come to his attention which cause him
to believe that any of such documents, when such documents became
effective or were so filed, as the case may be, contained, in the case of
a registration statement that became effective under the Act, an untrue
statement of a material fact, or omitted to state a material fact
required to be stated therein or necessary to make the statements therein
not misleading, or, in the case of other documents that were filed under
the Exchange Act with the Commission, an untrue statement of a material
fact or omitted to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they
were made when such documents were so filed, not misleading;
(x) The Registration Statement and the Prospectus and any
further amendments and supplements thereto made by the Company prior to
such Time of Delivery (other than the financial statements and related
schedules therein, as to which such counsel need express no opinion)
comply as to form in all material respects with the requirements of the
Act and the applicable rules and
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regulations thereunder; such counsel shall also include a statement in
his letter to the following effect: although he does not assume any
responsibility for the accuracy, completeness or fairness of the
statements contained in the Registration Statement or the Prospectus, no
facts have come to his attention which cause him to believe that, as of
its effective date, the Registration Statement or any further amendment
thereto made by the Company prior to such Time of Delivery (other than
the financial statements and related schedules therein, as to which such
counsel need express no opinion) contained an untrue statement of a
material fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein not misleading or
that, as of its date and as of such Time of Delivery, the Prospectus or
any further amendment or supplement thereto made by the Company prior to
such Time of Delivery (other than the financial statements and related
schedules therein, as to which such counsel need express no opinion)
contained or contains an untrue statement of a material fact or omitted
or omits to state a material fact necessary to make the statements
therein, in the light of the circumstances under which they were made,
not misleading; and he does not know of any amendment to the Registration
Statement required to be filed or of any contracts or other documents of
a character required to be filed as an exhibit to the Registration
Statement or required to be described in the Registration Statement or
the Prospectus which are not so filed or described therein; and
(xi) Except as set forth in the Registration Statement and
the Prospectus, no holders of Stock or other securities of the Company
have registration rights with respect to securities of the Company, and
all holders of securities of the Company having rights to registration of
such shares of Stock or other securities, because of the filing of the
Registration Statement by the Company have, with respect to the offering
contemplated thereby, waived such rights.
In rendering such opinion, such counsel may state that they express
no opinion as to the laws of any jurisdiction outside the United States.
(e) Xxxxx X. Xxxxxxx, counsel for each of the Selling
Stockholders, shall have furnished to you his written opinion with
respect to each of the Selling Stockholders (a draft of each such opinion
is attached as Annex II(d) hereto), dated such Time of Delivery, in form
and substance satisfactory to you, to the effect that:
(i) A Custody Agreement has been duly executed and
delivered by such Selling Stockholder and constitutes the valid and
binding agreement of such Selling Stockholder in accordance with
its terms, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights and to
general equity principles;
(ii) This Agreement and the International Underwriting
Agreement have been duly executed and delivered by or on behalf of
such Selling Stockholder; and the sale of the Shares to be sold by
such Selling Stockholder hereunder and thereunder and the
compliance by such Selling Stockholder with all of the provisions
of this Agreement, the International Underwriting Agreement and the
Custody Agreement and the consummation of the transactions herein
and therein contemplated will not conflict with or result in a
breach or violation of any terms or provisions of, or constitute a
default under, any statute, indenture, mortgage, deed of trust,
loan agreement or other agreement or instrument known to such
counsel to which such Selling Stockholder is a party or by which
such Selling Stockholder is bound or to which any of the property
or assets of such Selling Stockholder is subject, nor will such
action result in any violation of any order, rule or regulation
known to such counsel
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of any court or governmental agency or body having jurisdiction
over such Selling Stockholder or the property of such Selling
Stockholder;
(iii) No consent, approval, authorization or order of any
court or governmental agency or body is required for the
consummation of the transactions contemplated by this Agreement or
the International Underwriting Agreement in connection with the
Shares to be sold by such Selling Stockholder hereunder or
thereunder, except such as have been obtained under the Act and
such as may be required under state securities or Blue Sky laws in
connection with the purchase and distribution of such Shares by the
Underwriters or the International Underwriters;
(iv) Immediately prior to such Time of Delivery, such
Selling Stockholder had good and valid title to the Shares to be
sold at such Time of Delivery by such Selling Stockholder under
this Agreement and the International Underwriting Agreement, free
and clear of all liens, encumbrances, equities or claims, and full
right, power and authority to sell, assign, transfer and deliver
the Shares to be sold by such Selling Stockholder hereunder and
thereunder; and
(v) Good and valid title to such Shares, free and clear
of all liens, encumbrances, equities or claims, has been
transferred to each of the several Underwriters or International
Underwriters, as the case may be, who have purchased such Shares in
good faith and without notice of any such lien, encumbrance, equity
or claim or any other adverse claim within the meaning of the
Uniform Commercial Code.
In rendering such opinion, such counsel may state
that he expresses no opinion as to the laws of any jurisdiction
outside the United States and in rendering the opinion in paragraph
(iv), such counsel may rely upon a certificate of such Selling
Stockholder in respect of matters of fact as to ownership of, and
liens, encumbrances, equities or claims on, the Shares sold by such
Selling Stockholder, provided that such counsel shall state that
he believes that both you and he are justified in relying upon such
certificate;
(f) On the date of the Prospectus at a time prior to the
execution of this Agreement, at 9:30 a.m., New York City time, on the
effective date of any post-effective amendment to the Registration
Statement filed subsequent to the date of this Agreement and also at each
Time of Delivery, Xxxxxx Xxxxxxxx LLP shall have furnished to you a
letter or letters, dated the respective dates of delivery thereof, in
form and substance satisfactory to you, to the effect set forth in Annex
I hereto (the executed copy of the letter delivered prior to the
execution of this Agreement is attached as Annex I(a) hereto and a draft
of the form of letter to be delivered on the effective date of any
post-effective amendment to the Registration Statement and as of each
Time of Delivery is attached as Annex I(b) hereto);
(g) (i) Neither the Company nor any of its subsidiaries
shall have sustained since the date of the latest audited financial
statements included or incorporated by reference in the Prospectus any
loss or interference with its business from fire, explosion, flood or
other calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree, otherwise than
as set forth or contemplated in the Prospectus, and (ii) since the
respective dates as of which information is given in the Prospectus there
shall not have been any change in the consolidated loans, capital stock,
short-term debt or long-term debt of the Company or any of its
subsidiaries or any change, or any development involving a prospective
change, in or affecting the general affairs, management, financial
position, stockholders' equity or results of operations of the
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Company and its subsidiaries, otherwise than as set forth or contemplated
in the Prospectus, the effect of which, in any such case described in
Clause (i) or (ii), is in the judgment of the Underwriters so material
and adverse as to make it impracticable or inadvisable to proceed with
the public offering or the delivery of the Shares being delivered at such
Time of Delivery on the terms and in the manner contemplated in the
Prospectus;
(h) On or after the date hereof until each such Time of
Delivery, (i) no downgrading shall have occurred in the rating accorded
the Company's debt securities by any "nationally recognized statistical
rating organization", as that term is defined by the Commission for
purposes of Rule 436(g)(2) under the Act, and (ii) no such organization
shall have publicly announced that it has under surveillance or review,
with possible negative implications, its rating of any of the Company's
debt securities;
(i) On or after the date hereof until each such Time of
Delivery 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 on NASDAQ; (ii) a suspension or material
limitation in trading in the Company's securities on NASDAQ; (iii) a
general moratorium on commercial banking activities declared by Federal
or any State authorities; (iv) the outbreak or escalation of hostilities
involving 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 (iv) in the judgment of the Underwriters makes it
impracticable or inadvisable to proceed with the public offering or the
delivery of the Shares being delivered at such Time of Delivery on the
terms and in the manner contemplated in the Prospectus; or (v) the
occurrence of any material adverse change in the existing, financial,
political or economic conditions in the United States or elsewhere which,
in the judgment of the Underwriters, would materially and adversely
affect the financial markets, the markets for the Shares or the market
for any other equity securities;
(j) The Shares at such Time of Delivery shall have been
duly listed for quotation on NASDAQ;
(k) The Company has obtained and delivered to the
Underwriters executed copies of an agreement from each executive officer,
director and key employee (as disclosed in the Prospectus under the
caption "Management") of the Company and each stockholder of the Company
that beneficially owns five percent or more of the outstanding Stock,
substantially to the effect set forth in Subsection 1(b)(iv) hereof in
form and substance satisfactory to you;
(l) The Company shall have complied with the provisions
of Section 5(c) hereof with respect to the furnishing of prospectuses on
the New York Business Day next succeeding the date of this Agreement; and
(m) The Company and the Selling Stockholders shall have
furnished or caused to be furnished to you at such Time of Delivery
certificates of officers of the Company and of the Selling Stockholders,
respectively, satisfactory to you, as to the accuracy of the
representations and warranties of the Company and the Selling
Stockholders, respectively, herein at and as of such Time of Delivery, as
to the performance by the Company and the Selling Stockholders of all of
their respective obligations hereunder to be performed at or prior to
such Time of Delivery, and as to such other matters as you may reasonably
request, and the Company shall have furnished or caused to be furnished
certificates as to the matters set forth in subsections (a) and (g) of
this Section.
8. (a) The Company and each of the Selling Stockholders, jointly and
severally, will indemnify and hold harmless each Underwriter against any
losses, claims, damages or liabilities, joint or several, to which such
Underwriter may become subject, under the Act or otherwise, insofar as such
losses, claims,
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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 any Preliminary Prospectus, the Registration Statement or 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 not
misleading, and will reimburse each Underwriter for any legal or other expenses
reasonably incurred by such Underwriter in connection with investigating or
defending any such action or claim as such expenses are incurred; provided,
however, that the Company and the Selling Stockholders shall not be liable in
any such case to the extent that any such loss, claim, damage or liability
arises out of or is based upon an untrue statement or alleged untrue statement
or omission or alleged omission made in any Preliminary Prospectus, the
Registration Statement or the Prospectus or any such amendment or supplement in
reliance upon and in conformity with written information furnished to the
Company by any Underwriter through Xxxxxxx, Sachs & Co. expressly for use
therein; provided, further, that the liability of a Selling Stockholder
pursuant to this subsection 8(a) shall not exceed the product of the number of
Shares sold by such Selling Stockholder and the initial public offering price
of the Shares as set forth in the Prospectus.
(b) Each Underwriter will indemnify and hold harmless the Company and
each Selling Stockholder against any losses, claims, damages or liabilities to
which the Company or such Selling Stockholder 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 any Preliminary
Prospectus, the Registration Statement or 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 not misleading, in each case to the
extent, but only to the extent, that such untrue statement or alleged untrue
statement or omission or alleged omission was made in any Preliminary
Prospectus, 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 such Underwriter through Xxxxxxx, Xxxxx & Co.
expressly for use therein; and will reimburse the Company and each Selling
Stockholder for any legal or other expenses reasonably incurred by the Company
or such Selling Stockholder in connection with investigating or defending any
such action or claim as such expenses are incurred.
(c) Promptly after receipt by an indemnified party under subsection (a)
or (b) above of notice of the commencement of any action, such indemnified
party shall, if a claim in respect thereof is to be made against the
indemnifying party under such subsection, notify the indemnifying party in
writing of the commencement thereof; but the omission so to notify the
indemnifying party shall not relieve it from any liability that it may have to
any indemnified party otherwise than under such subsection. In case any such
action shall be brought against any indemnified party and it shall notify the
indemnifying party of the commencement thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it shall wish, jointly
with any other indemnifying party similarly notified, to assume the defense
thereof, with counsel satisfactory to such indemnified party (who shall not,
except with the consent of the indemnified party, be counsel to the
indemnifying 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 under such
subsection for any legal expenses of other counsel or any other expenses, in
each case subsequently incurred by such indemnified party, in connection with
the defense thereof other than reasonable costs of investigation. No
indemnifying party shall, without the written consent of the indemnified party,
effect the settlement or compromise of, or consent to the entry of any judgment
with respect to, any pending or threatened action or claim in respect of which
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indemnification or contribution may be sought hereunder (whether or not the
indemnified party is an actual or potential party to such action or claim)
unless such settlement, compromise or judgment (i) includes an unconditional
release of the indemnified party from all liability arising out of such action
or claim and (ii) does not include a statement as to or an admission of fault,
culpability or a failure to act, by or on behalf of any indemnified party.
(d) If the indemnification provided for in this Section 8 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities
(or actions in respect thereof) in such proportion as is appropriate to reflect
the relative benefits received by the Company and the Selling Stockholders on
the one hand and the Underwriters on the other from the offering of the Shares.
If, however, the allocation provided by the immediately preceding sentence is
not permitted by applicable law or if the indemnified party failed to give the
notice required under subsection (c) above, then each indemnifying party shall
contribute to such amount paid or payable by such indemnified party in such
proportion as is appropriate to reflect not only such relative benefits but
also the relative fault of the Company and the Selling Stockholders on the one
hand and the Underwriters on the other in connection with the statements or
omissions that resulted in such losses, claims, damages or liabilities (or
actions in respect thereof), as well as any other relevant equitable
considerations. The relative benefits received by the Company and the Selling
Stockholders on the one hand and the Underwriters on the other shall be deemed
to be in the same proportion as the total net proceeds from the offering of the
Shares purchased under this Agreement (before deducting expenses) received by
the Company and the Selling Stockholders bears to the total underwriting
discounts and commissions received by the Underwriters with respect to the
Shares purchased under this Agreement, 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 or alleged untrue
statement of a material fact or the omission or alleged omission to state a
material fact relates to information supplied by the Company or the Selling
Stockholders on the one hand or the Underwriters on the other and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission. The Company, each of the Selling
Stockholders and the Underwriters agree that it would not be just and equitable
if contributions pursuant to this subsection (d) were determined by pro rata
allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation that does not take account of the
equitable considerations referred to above in this subsection (d). The amount
paid or payable by an indemnified party as a result of the losses, claims,
damages or liabilities (or actions in respect thereof) referred to above in
this subsection (d) shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any such action or claim. Notwithstanding the provisions of this
subsection (d), no Underwriter shall be required to contribute any amount in
excess of the amount by which the total price at which the Shares underwritten
by it and distributed to the public were offered to the public exceeds the
amount of any damages that such Underwriter has otherwise been required to pay
by reason of such untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation. The Underwriters'
obligations in this subsection (d) to contribute are several in proportion to
their respective underwriting obligations and not joint.
(e) The obligations of the Company and the Selling Stockholders under
this Section 8 shall be in addition to any liability that the Company and the
respective Selling Stockholders may otherwise have
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and shall extend, upon the same terms and conditions, to each person, if any,
who controls any Underwriter within the meaning of the Act; and the obligations
of the Underwriters under this Section 8 shall be in addition to any liability
that the respective Underwriters may otherwise have and shall extend, upon the
same terms and conditions, to each officer and director of the Company and to
each person, if any, who controls the Company or any Selling Stockholder within
the meaning of the Act.
9. (a) If any Underwriter shall default in its obligation to
purchase the Shares that it has agreed to purchase hereunder at a Time of
Delivery, 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 hours after such default by any Underwriter you do not arrange for
the purchase of such Shares, then the Company and the Selling Stockholders
shall be entitled to a further period of thirty-six hours within which to
procure another party or other parties 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 Stockholders that you have so
arranged for the purchase of such Shares, or the Company and the Selling
Stockholders notify you that they have so arranged for the purchase of such
Shares, you or the Company and the Selling Stockholders shall have the right to
postpone a Time of Delivery for a period of not more than seven days, in order
to effect whatever changes may thereby be made necessary in the Registration
Statement or the Prospectus, or in any 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 person
substituted under this Section 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 by you, the
Company and the Selling Stockholders as provided in subsection (a) above, the
aggregate number of such Shares which remains unpurchased does not exceed
one-eleventh of the aggregate number of all the Shares to be purchased at such
Time of Delivery, then the Company and the Selling Stockholders shall have the
right to require each non-defaulting Underwriter to purchase the number of
Shares which such Underwriter agreed to purchase hereunder at such Time of
Delivery and, in addition, to require each non-defaulting Underwriter to
purchase its pro rata share (based on the number of Shares that 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 by you, the
Company and the Selling Stockholders as provided in subsection (a) above, the
aggregate number of such Shares that remains unpurchased exceeds one-eleventh
of the aggregate number of all of the Shares to be purchased at such Time of
Delivery, or if the Company and the Selling Stockholders shall not exercise the
right described in subsection (b) above to require non-defaulting Underwriters
to purchase Shares of a defaulting Underwriter or Underwriters, then this
Agreement (or, with respect to the Second Time of Delivery, the obligations of
the Underwriters to purchase and of the Company to sell the Optional Shares)
shall thereupon terminate, without liability on the part of any non-defaulting
Underwriter or the Company or the Selling Stockholders, except for the expenses
to be borne by the Company and the Selling Stockholders and the Underwriters as
provided in Section 6 hereof and the indemnity and contribution agreements in
Section 8 hereof; but nothing herein shall relieve a defaulting Underwriter
from liability for its default.
10. The respective indemnities, agreements, representations, warranties
and other statements of the Company, the Selling Stockholders and the several
Underwriters, as set forth in this Agreement or made
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by or on behalf of them, respectively, pursuant to this Agreement, shall remain
in full force and effect, regardless of any investigation (or any statement as
to the results thereof) made by or on behalf of any Underwriter or any
controlling person of any Underwriter, or the Company, or any of the Selling
Stockholders, or any officer or director or controlling person of the Company,
or any controlling person of any Selling Stockholder, and shall survive
delivery of and payment for the Shares.
11. If this Agreement shall be terminated pursuant to Section 9 hereof,
neither the Company nor the Selling Stockholders shall then be under any
liability to any Underwriter except as provided in Sections 6 and 8 hereof;
but, if for any other reason any Shares are not delivered by or on behalf of
the Company and the Selling Stockholders as provided herein, the Company and
each of the Selling Stockholders pro rata (based on the number of Shares to be
sold by the Company and such Selling Stockholder hereunder) will reimburse the
Underwriters through you for all out-of-pocket expenses approved in writing by
you, including fees and disbursements of counsel, reasonably incurred by the
Underwriters in making preparations for the purchase, sale and delivery of the
Shares not so delivered, but the Company and the Selling Stockholders shall
then be under no further liability to any Underwriter in respect of the Shares
not so delivered except as provided in Sections 6 and 8 hereof.
12. In all dealings hereunder, you shall act on behalf of each of the
Underwriters, and the parties hereto shall be entitled to act and rely upon any
statement, request, notice or agreement on behalf of any Underwriter made or
given by you jointly or by Xxxxxxx, Sachs & Co. on behalf of you; and in all
dealings with any Selling Stockholder hereunder, you and the Company shall be
entitled to act and rely upon any statement, request, notice or agreement on
behalf of such Selling Stockholder made or given by such Selling Stockholder.
All statements, requests, notices and agreements hereunder shall be in
writing, and if to the Underwriters shall be delivered or sent by mail, telex
or facsimile transmission to the Underwriters in care of Xxxxxxx, Xxxxx & Co.,
00 Xxx Xxxx, 0xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Registration
Department; if to any Selling Stockholder shall be delivered or sent by mail,
telex or facsimile transmission to counsel for such Selling Stockholder at 0000
Xxxxx Xxxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxx 00000, Attention: Xxxxx X. Xxxxxxx,
Telephone: (000) 000-0000; and if to the Company shall be delivered or sent by
mail, telex or facsimile transmission to the address of the Company set forth
in the Registration Statement, Attention: Secretary; provided, however, that
any notice to an Underwriter pursuant to Section 8(c) hereof shall be delivered
or sent by mail, telex or facsimile transmission to such Underwriter at its
address set forth in its Underwriters' Questionnaire or telex constituting such
Questionnaire, which
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address will be supplied to the Company or the Selling Stockholders by you on
request. Any such statements, requests, notices or agreements shall take
effect upon receipt thereof.
13. This Agreement shall be binding upon, and inure solely to the
benefit of, the Underwriters, the Company and the Selling Stockholders and, to
the extent provided in Sections 8 and 10 hereof, the officers and directors of
the Company and each person who controls the Company, any Selling Stockholder
or any Underwriter, and their respective heirs, executors, administrators,
successors and assigns, and no other person shall acquire or have any right
under or by virtue of this Agreement. No purchaser of any of the Shares from
any Underwriter shall be deemed a successor or assign by reason merely of such
purchase.
14. Time shall be of the essence of this Agreement. As used herein,
the term "business day" shall mean any day when the Commission's office in
Washington, D.C. is open for business.
15. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK.
16. 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.
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If the foregoing is in accordance with your understanding, please sign and
return to us ten counterparts hereof, and upon the acceptance hereof by you, on
behalf of each of the Underwriters, this letter and such acceptance hereof
shall constitute a binding agreement among each of the Underwriters, the
Company and each of the Selling Stockholders. It is understood that your
acceptance of this letter on behalf of each of the Underwriters is pursuant to
the authority set forth in a form of Agreement among Underwriters (U.S.
Version), the form of which shall be submitted to the Company and the Selling
Stockholders for examination, upon request, but without warranty on your part
as to the authority of the signers thereof.
Very truly yours,
TeleBanc Financial Corporation
By:
------------------------------
Name:
Title:
Xxxxx X. Xxxxxx
----------------------------------
Name: Xxxxx X. Xxxxxx
Xxxxxxxx X. Xxxxxx
----------------------------------
Name: Xxxxxxxx X. Xxxxxx
Accepted as of the date hereof:
Xxxxxxx, Xxxxx & Co.
BancBoston Xxxxxxxxx Xxxxxxxx Inc.
Xxxx Xxxxx Xxxx Xxxxxx, Incorporated
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated
By:
----------------------------------------------
(Xxxxxxx, Sachs & Co.)
On behalf of each of the Underwriters
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SCHEDULE I
NUMBER OF OPTIONAL
SHARES TO BE
TOTAL NUMBER OF PURCHASED IF
FIRM SHARES MAXIMUM OPTION
UNDERWRITER TO BE PURCHASED EXERCISED
----------- -------------------- ----------------------
Xxxxxxx, Xxxxx & Co. . . . . . . . . . . . . . . . . .
BancBoston Xxxxxxxxx Xxxxxxxx Inc. . . . . . . . . . .
Xxxx Xxxxx Xxxx Xxxxxx, Incorporated . . . . . . . . .
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated . .
-------------------- ----------------------
Total . . . . . . . . . . . . . . . . . . . . .
==================== ======================
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SCHEDULE II
NUMBER OF OPTIONAL
SHARES TO BE
TOTAL NUMBER OF SOLD IF
FIRM SHARES MAXIMUM OPTION
TO BE SOLD EXERCISED
-------------------- ----------------------
The Company. . . . . . . . . . . . . . . . . . . . . . . .
The Selling Stockholders: . . . . . . . . . . . . . . . . .
Xxxxx X. Xxxxxx . . . . . . . . . . . . . . . . . . .
Xxxxxxxx X. Xxxxxx . . . . . . . . . . . . . . . . .
-------------------- ----------------------
Total . . . . . . . . . . . . . . . . . . . . . . .
==================== ======================
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ANNEX I
Pursuant to Section 7(f) of the Underwriting Agreement, the accountants
shall furnish letters to the Underwriters to the effect that:
(i) They are independent public accountants with respect to the
Company and its subsidiaries within the meaning of the Act and the
applicable published rules and regulations thereunder;
(ii) In their opinion, the financial statements and notes
thereto examined by them and included or incorporated by reference in
the Registration Statement or the Prospectus comply as to form in all
material respects with the applicable accounting requirements of the
Act or the Exchange Act, as applicable, and the related published
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 consolidated interim
financial statements, selected financial data, pro forma financial
information, financial forecasts and/or condensed financial statements
derived from audited financial statements of the Company for the
periods specified in such letter, as indicated in their reports
thereon, copies of which have been separately furnished to the
Underwriters;
(iii) They have made a review in accordance with standards
established by the American Institute of Certified Public Accountants
of the unaudited condensed consolidated statements of income,
consolidated balance sheets and consolidated statements of cash flows
included in the Prospectus and/or included in the Company's quarterly
report on Form 10-Q incorporated by reference into the Prospectus as
indicated in their reports thereon, copies of which have been
separately furnished to the Underwriters; and on the basis of
specified procedures, including inquiries of officials of the Company
who have responsibility for financial and accounting matters regarding
whether the unaudited condensed consolidated financial statements
referred to in paragraph (vi)(A)(i) below comply as to form in all
material respects with the applicable accounting requirements of the
Act and the Exchange Act and the related published rules and
regulations, nothing came to their attention that caused them to
believe that the unaudited condensed consolidated financial statements
do not comply as to form in all material respects with the applicable
accounting requirements of the Act and the Exchange Act and the
related published rules and regulations;
(iv) The unaudited selected financial information with respect
to the consolidated results of operations and financial position of
the Company for the five most recent fiscal years included in the
Prospectus and included or incorporated by reference in Item 6 of the
Company's Annual Report on Form 10-K for the most recent fiscal year
agrees with the corresponding amounts (after restatement where
applicable) in the audited consolidated financial statements for such
five fiscal years that were included or incorporated by reference in
the Company's Annual Reports on Form 10-K for such fiscal years;
(v) They have compared the information in the Prospectus under
selected captions with the disclosure requirements of Regulation S-K
and on the basis of limited procedures specified
30
in such letter nothing came to their attention as a result of the
foregoing procedures that caused them to believe that this information
does not conform in all material respects with the disclosure
requirements of Items 301 and 302, respectively, of Regulation S-K;
(vi) On the basis of limited procedures, not constituting an
examination in accordance with generally accepted auditing standards,
consisting of a reading of the unaudited financial statements and
other information referred to below, a reading of the latest
available interim financial statements of the Company and its
subsidiaries, inspection of the minute books of the Company and its
subsidiaries since the date of the latest audited financial statements
included or incorporated by reference in the Prospectus, inquiries of
officials of the Company and its subsidiaries 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) (i) the unaudited condensed consolidated statements
of income, consolidated balance sheets and consolidated statements
of cash flows included in the Prospectus and/or included or
incorporated by reference in the Company's Quarterly Reports on
Form 10-Q incorporated by reference in the Prospectus do not
comply as to form in all material respects with the applicable
accounting requirements of the Exchange Act as it applies to Form
10-Q and the related published rules and regulations, or (ii) any
material modifications should be made to the unaudited condensed
consolidated statements of income, consolidated balance sheets and
consolidated statements of cash flows included in the Prospectus
or included in the Company's Quarterly Reports on Form 10-Q
incorporated by reference in the Prospectus, for them to be in
conformity with generally accepted accounting principles;
(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
or incorporated by reference in the Company's Annual Report on
Form 10-K for the most recent fiscal year;
(C) the unaudited financial statements that were not
included in the Prospectus but from which were derived the
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 financial statements included or incorporated by
reference in the Company's Annual Report on Form 10-K for the most
recent fiscal year;
(D) any unaudited pro forma consolidated condensed
financial statements included or incorporated by reference 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 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 days prior
to the date of such letter,
2
31
there have been any changes in the consolidated capital stock
(other than issuances of capital stock upon exercise of options
and stock appreciation rights, upon earn-outs of performance
shares and upon conversions of convertible securities, in each
case that were outstanding on the date of the latest balance sheet
included or incorporated by reference in the Prospectus) or any
increase in the consolidated short-term debt or long-term debt of
the Company and its subsidiaries, or any decreases in consolidated
loans, consolidated net current assets or stockholders' equity or
other items specified by the Underwriters, or any increases in any
items specified by the Underwriters, in each case as compared with
amounts shown in the latest balance sheet included or
incorporated by reference in the Prospectus, except in each case
for changes, increases or decreases that the Prospectus discloses
have occurred or may occur or that are described in such letter;
and
(F) for the period from the date of the latest financial
statements included or incorporated by reference in the Prospectus
to the specified date referred to in Clause (E) there were any
decreases in consolidated net revenues or operating profit or the
total or per share amounts of consolidated net income or other
items specified by the Underwriters, or any increases in any items
specified by the Underwriters, in each case as compared with the
comparable period of the preceding year and with any other period
of corresponding length specified by the Underwriters, except in
each case for increases or decreases that the Prospectus discloses
have occurred or may occur or that are described in such letter;
and
(vii) In addition to the examination referred to in their
report(s) included or incorporated by reference in the Prospectus and
the limited procedures, inspection of minute books, inquiries and
other procedures referred to in paragraphs (iii) and (vi) above, they
have carried out certain specified procedures, not constituting an
examination in accordance with generally accepted auditing standards,
with respect to certain amounts, percentages and financial information
specified by the Underwriters that are derived from the general
accounting records of the Company and its subsidiaries, that appear in
the Prospectus (excluding documents incorporated by reference) or in
Part II of, or in exhibits and schedules to, the Registration
Statement specified by the Underwriters or in documents incorporated
by reference in the Prospectus specified by the Underwriters, 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.
3
